STOCK PURCHASE WARRANT
To Purchase Shares of Common Stock of
VIDAMED, INC.
THIS CERTIFIES that, for value received, [Name] (the "Investor"), is
entitled, upon the terms and subject to the conditions hereinafter set forth, at
any time on or prior to the close of business on the date three (3) years after
the date hereof, but not thereafter, to subscribe for and purchase, from
VIDAMED, INC. a Delaware corporation (the "Company"), [Shares] shares of Common
Stock. The purchase price of one share of Common Stock under this Warrant shall
be $[Price] per share. The purchase price and the number of shares for which the
Warrant is exercisable shall be subject to adjustment as provided herein.
1. Title of Warrant. Prior to the expiration hereof and subject to
compliance with applicable laws, this Warrant and all rights hereunder are
transferable, in whole or in part, at the office or agency of the Company,
referred to in Section 2 hereof, by the holder hereof in person or by duly
authorized attorney, upon surrender of this Warrant together with the Assignment
Form annexed hereto properly endorsed.
2. Exercise of Warrant.
(a) The purchase rights represented by this Warrant are
exercisable by the registered holder hereof, in whole or in part, at any time
before the close of business on the date three (3) years after the date hereof,
by delivery of the Notice of Exercise form annexed hereto duly executed at the
office of the Company, in Fremont, California (or such other office or agency of
the Company as it may designate by notice in writing to the registered holder
hereof at the address of such holder appearing on the books of the Company), and
upon payment of the purchase price of the shares thereby purchased (by cash or
by check or bank draft payable to the order of the Company); whereupon the
holder of this Warrant shall be entitled to receive a certificate for the number
of shares of Common Stock so purchased. The Company agrees that if at the time
of the surrender of this Warrant and purchase the holder hereof shall be
entitled to exercise this Warrant, the shares so purchased shall be and be
deemed to be issued to such holder as the record owner of such shares as of the
close of business on the date on which this Warrant shall have been exercised as
aforesaid. If this Warrant should be exercised in part only, the Issuer shall,
upon surrender of this Warrant, execute and deliver a new Warrant evidencing the
rights of the holder hereof to purchase the balance of the Warrant Shares
purchasable hereunder.
(b) In lieu of the cash payment set forth in paragraph 2(a)
above, the Holder shall have the right ("Conversion Right") to convert this
Warrant in its entirety (without payment of any kind) into that number of shares
of Common Stock equal to the quotient obtained by dividing the Net Value (as
defined below) of the Shares issuable upon exercise of this Warrant by the Fair
Market Value (as defined below) of one share of Common Stock. As used herein,
(A) the Net Value of the Shares means the aggregate Fair Market Value of the
shares of Common Stock subject to this Warrant minus the aggregate exercise
price; and (B) the Fair Market Value of one share of Common Stock means:
(i) if the exercise occurs at a time during which the
Company's Common Stock is traded on a national securities exchange or on the
Nasdaq National Market or the Nasdaq Small Cap Market, the Fair Market Value of
one share of Common Stock means the average last reported or closing sale price
for the Company's Common Stock on such exchange or market for the ten (10)
trading days ending one business day before the exercise of this Warrant;
(ii) if the exercise is in connection with a merger,
sale of assets or other reorganization transaction as described in Section 9(a)
below, the Fair Market Value of one share of Common Stock means the value
received by the holders of the Company's Common Stock pursuant to such
transaction; and
(iii) in all other cases, the Fair Market Value of
one share of Common Stock shall be determined in good faith by the Company's
Board of Directors.
(c) Certificates for shares purchased hereunder shall be
delivered to the holder hereof promptly after this Warrant shall have been
exercised as aforesaid. The Company covenants that all shares of Common Stock
which may be issued upon the exercise of rights represented by this Warrant
will, upon exercise of the rights represented by this Warrant, be fully paid and
nonassessable and free from all taxes, liens and charges in respect of the issue
thereof (other than taxes in respect of any transfer occurring contemporaneously
with such issue).
3. No Fractional Shares or Scrip. No fractional shares or scrip
representing fractional shares shall be issued upon the exercise of this
Warrant. With respect to any fraction of a share called for upon the exercise of
this Warrant, an amount equal to such fraction multiplied by the then Fair
Market Value shall be paid in cash to the holder of this Warrant.
4. Charges, Taxes and Expenses. Issuance of certificates for shares of
Common Stock upon the exercise of this Warrant shall be made without charge to
the holder hereof for any issue or transfer tax or other incidental expense in
respect of the issuance of such certificate, all of which taxes and expenses
shall be paid by the Company, and such certificates shall be issued in the name
of the holder of this Warrant or in such name or names as may be directed by the
holder of this Warrant; provided, however, that in the event certificates for
shares of Common Stock are to be issued in a name other than the name of the
holder of this Warrant, this Warrant when surrendered for exercise shall be
accompanied by the Assignment Form attached hereto duly executed by the holder
hereof.
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5. No Rights as Shareholders. This Warrant does not entitle the holder
hereof to any voting rights or other rights as a stockholder of the Company
prior to the exercise thereof.
6. Exchange and Registry of Warrant. This Warrant is exchangeable,
without charge, upon the surrender hereof by the registered holder at the
above-mentioned office or agency of the Company, for a new Warrant of like tenor
and dated as of such exchange.
The Company shall maintain at the above-mentioned office or agency a
registry showing the name and address of the registered holder of this Warrant.
This Warrant may be surrendered for exchange, transfer or exercise, in
accordance with its terms, at such office or agency of the Company, and the
Company shall be entitled to rely in all respects, prior to written notice to
the contrary, upon such registry.
7. Loss, Theft, Destruction or Mutilation of Warrant. Upon receipt by
the Company of evidence reasonably satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant, and in case of loss, theft or
destruction, of indemnity or security reasonably satisfactory to it, and
cancellation of this Warrant, if mutilated, the Company will make and deliver a
new Warrant of like tenor and dated as of such cancellation, in lieu of this
Warrant.
8. Saturdays, Sundays, Holidays, etc. If the last or appointed day for
the taking of any action or the expiration of any right required or granted
herein shall be a Saturday or a Sunday or shall be a legal holiday, then such
action may be taken or such right may be exercised on the next succeeding day
not a legal holiday.
9. Early Termination and Registration Statement Adjustments.
(a) Merger, Sale of Assets, etc. In case of any consolidation
of the Company with, or merger of the Company into, any other corporation (other
than a consolidation or merger in which the Company is the continuing
corporation and in which no change occurs in its outstanding Common Stock), or
in case of any sale or transfer of all or substantially all of the assets of the
Company, or in the case of any statutory exchange of securities with another
corporation (including any exchange effected in connection with a merger of a
third corporation into the Company, except where the Company is the surviving
entity and no change occurs in its outstanding Common Stock), the corporation
formed by such consolidation or the corporation resulting from or surviving such
merger or the corporation which shall have acquired such assets or securities of
the Company, as the case may be, shall execute and deliver to the Holder
simultaneously therewith a new Warrant, satisfactory in form and substance to
the Holder, together with such other documents as the Holder may reasonably
request, entitling the Holder thereof to receive upon exercise of such Warrant
the kind and amount of shares of stock and other securities and property
receivable upon such consolidation, merger, sale, transfer, or exchange of
securities, or upon the dissolution following such sale or other transfer, by a
holder of the number of shares of Common Stock purchasable upon exercise of this
Warrant immediately prior to such consolidation, merger, sale, transfer, or
exchange. Such new Warrant shall contain the same basic other terms and
conditions as this Warrant and shall provide for adjustments which, for events
subsequent to the effective date of such written instrument, shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Section
9. The above provisions of this paragraph (a) shall similarly apply to
successive
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consolidations, mergers, exchanges, sales or other transfers covered hereby.
Notwithstanding the foregoing, in the event the consideration to be paid to
holders of Company capital stock in any transaction of the nature referred to
above in this Section 9(a) (a "Transaction") consists of cash or cash
equivalents, then, provided that the Company shall have given the holder hereof
the notice required by Section 10, this Warrant shall, to the extent it has not
been exercised by the effective date of such Transaction, terminate upon the
completion of such Transaction.
(b) Reclassification, etc. If the Company at any time shall,
by subdivision, combination or reclassification of securities or otherwise,
change any of the securities to which purchase rights under this Warrant exist
into the same or a different number of securities of any class or classes, this
Warrant shall thereafter represent the right to acquire such number and kind of
securities as would have been issuable as the result of such change with respect
to the securities which were subject to the purchase rights under this Warrant
immediately prior to such subdivision, combination, reclassification or other
change. If shares of the Company's Common Stock are subdivided or combined into
a greater or smaller number of shares of Common Stock, the purchase price under
this Warrant shall be proportionately reduced in case of subdivision of shares
or proportionately increased in the case of combination of shares, in both cases
by the ratio which the total number of shares of Common Stock to be outstanding
immediately after such event bears to the total number of shares of Common Stock
outstanding immediately prior to such event.
(c) Cash Distributions. Except as set forth herein, no
adjustment on account of cash dividends on the Company's Common Stock or other
securities purchasable hereunder will be made to the purchase price under this
Warrant.
(d) Authorized Shares. The Company covenants that during the
period the Warrant is outstanding, it will reserve from its authorized and
unissued Common Stock a sufficient number of shares to provide for the issuance
of Common Stock upon the exercise of any purchase rights under this Warrant. The
Company further covenants that its issuance of this Warrant shall constitute
full authority to its officers who are charged with the duty of executing stock
certificates to execute and issue the necessary certificates for shares of the
Company's Common Stock upon the exercise of the purchase rights under this
Warrant. The Company further covenants and agrees (i) that it will not, by
amendment of its Certificate of Incorporation or through reorganization,
consolidation, merger, dissolution or sale of assets, or by any other voluntary
act, avoid or seek to avoid the observation or performance of any of the
covenants, stipulations or conditions to be observed or performed hereunder by
the Company, (ii) promptly to take such action as may be required of the Company
to permit the Holder to exercise this Warrant and the Company duly and
effectively to issue shares of its Common Stock or other securities as provided
herein upon the exercise hereof and (iii) promptly to take all action required
or provided herein to protect the rights of the Holder granted hereunder against
dilution.
(e) If the Company declares a dividend on Common Stock, or
makes a distribution to holders of Common Stock, and such dividend or
distribution is payable or made in Common Stock or securities convertible into
or exchangeable for Common Stock, or rights to purchase Common Stock or
securities convertible into or exchangeable for Common Stock, the number of
shares of Common Stock for which this Warrant may be exercised shall be
increased, as of the record date for determining which holders of Common Stock
shall be entitled to receive such dividend or
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distribution, in proportion to the increase in the number of outstanding shares
(and shares of Common Stock issuable upon conversion of all such securities
convertible into Common Stock) of Common Stock as a result of such dividend or
distribution, and the Exercise Price shall be adjusted so that the aggregate
amount payable for the purchase of all the Warrant Shares issuable hereunder
immediately after the record date for such dividend or distribution shall equal
the aggregate amount so payable immediately before such record date.
(f) If the Company declares a dividend on Common Stock (other
than a dividend covered by subsection (g) above) or distributes to holders of
its Common Stock, other than as part of its dissolution or liquidation or the
winding up of its affairs, any shares of its capital stock, any evidence of
indebtedness or any cash or other of its assets (other than Common Stock or
securities convertible into or exchangeable for Common Stock), the Holder shall
receive notice of such event as set forth in Section 11 below.
(g) If the Company shall, at any time before the expiration of
this Warrant, sell all or substantially all of its assets and distribute the
proceeds thereof to the Company's stockholders, the Holder shall, upon exercise
of this Warrant have the right to receive, in lieu of the shares of Common Stock
of the Company that the Holder otherwise would have been entitled to receive,
the same kind and amount of assets as would have been issued, distributed or
paid to the Holder upon any such distribution with respect to such shares of
Common Stock of the Company had the Holder been the holder of record of such
shares of Common Stock receivable upon exercise of this Warrant on the date for
determining those entitled to receive any such distribution. If any such
distribution results in any cash distribution in excess of the Exercise Price
provided by this Warrant for the shares of Common Stock receivable upon exercise
of this Warrant, the Holder may, at the Holder's option, exercise this Warrant
without making payment of the Exercise Price and, in such case, the Company
shall, upon distribution to the Holder, consider the Exercise Price to have been
paid in full and, in making settlement to the Holder, shall obtain receipt of
the Exercise Price by deducting an amount equal to the Exercise Price for the
shares of Common Stock receivable upon exercise of this Warrant from the amount
payable to the Holder. Notwithstanding the foregoing, in the event the
consideration to be paid to holders of Company capital stock in any transaction
of the nature referred to above in this Section 9(i) (an "Asset Sale
Transaction") consists of cash or cash equivalents and the consideration payable
per share of Common Stock of the Company is less than the Exercise Price
hereunder, then, provided that the Company shall have given the holder hereof
the notice required by Section 10, this Warrant shall, to the extent it has not
been exercised by the effective date of such Transaction, terminate upon the
completion of such Transaction.
(h) The term "Common Stock" shall mean the Common Stock of the
Company as the same exists as of the date hereof, or as such stock may be
constituted from time to time, except that for the purpose of this Section 9,
the term "Common Stock" shall include any stock of any class of the Company
which has no preference in respect of dividends or of amounts payable in the
event of any voluntary or involuntary liquidation, dissolution or winding up of
the Company and which is not subject to redemption by the Company.
(i) Whenever the number of Warrant Shares or the Exercise
Price shall be adjusted as required by the provisions of this Section 9, the
Company forthwith shall file in the custody of its secretary or an assistant
secretary, at its principal office, and furnish to each Holder hereof, a
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certificate prepared by its Chief Financial Officer, showing the adjusted number
of Warrant Shares and the adjusted Exercise Price and setting forth in
reasonable detail the circumstances requiring the adjustments.
(j) No adjustment in the Exercise Price in accordance with the
provisions of this Section 9 need be made if such adjustment would amount to a
change in such Exercise Price of less than $.01; provided however, that the
amount by which any adjustment is not made by reason of the provisions of this
paragraph (l) shall be carried forward and taken into account at the time of any
subsequent adjustment in the Exercise Price.
(k) If an adjustment is made under this Section 9 and the
event to which the adjustment relates does not occur, then any adjustments in
accordance with this Section 9 shall be readjusted to the Exercise Price and the
number of Warrant Shares which would be in effect had the earlier adjustment not
been made.
10. Notice of Adjustment. So long as this Warrant shall be outstanding,
(a) if the Company shall propose to pay any dividends or make any distribution
upon the Common Stock, or (b) if the Company shall offer generally to the
holders of Common Stock the right to subscribe to or purchase any shares of any
class of Common Stock or securities convertible into Common Stock or any other
similar rights, or (c) if there shall be any proposed capital reorganization of
the Company in which the Company is not the surviving entity, recapitalization
of the capital stock of the Company, consolidation or merger of the Company with
or into another corporation, sale, lease or other transfer of all or
substantially all of the property and assets of the Company, or voluntary or
involuntary dissolution, liquidation or winding up of the Company, or (d) if the
Company shall give to its stockholders any notice, report or other communication
respecting any significant or special action or event, then in such event, the
Company shall give to the Holder, at least ten (10) days prior to the relevant
date described below, a notice containing a description of the proposed action
or event and stating the date or expected date on which a record of the
Company's stockholders is to be taken for any of the foregoing purposes, and the
date or expected date on which any such dividend, distribution, subscription,
reclassification, reorganization, consolidation, combination, merger,
conveyance, sale, lease or transfer, dissolution, liquidation or winding up is
to take place and the date or expected date, if any is to be fixed, as of which
the holders of Common Stock of record shall be entitled to exchange their shares
of Common Stock for securities or other property deliverable upon such event.
11. Notice. Any notice to be given or to be served upon any party in
connection with the Warrant must be in writing and will be deemed to have been
given and received upon confirmed receipt, if sent by facsimile, or two (2) days
after it has been submitted for delivery by Federal Express or an equivalent
carrier, charges prepaid and addressed to the following addresses with a
confirmation of delivery:
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If to the Company, to:
VidaMed, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Holder, to:
Address set forth in Exhibit A to Purchase Agreement
Any party may, at any time by giving written notice to the other party,
designate any other address in substitution of an address established pursuant
to the foregoing to which such notice will be given.
12. Miscellaneous.
(a) Issue Date. The provisions of this Warrant shall be
construed and shall be given effect in all respect as if it had been issued and
delivered by the Company on the date hereof. This Warrant shall be binding upon
any successors or assigns of the Company.
(b) Restrictions. The holder hereof acknowledges that the
Common Stock acquired upon the exercise of this Warrant may have restrictions
upon its resale imposed by state and federal securities laws.
(c) Governing Law. This Agreement shall be governed in all
respects by and construed in accordance with the laws of the State of Delaware
without any regard to conflicts of laws principles.
(d) Successors and Assigns. Except as otherwise contemplated
hereby, this Warrant shall be binding upon and inure to the benefit of any
successors and assigns of the Company.
[remainder of page intentionally left blank]
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IN WITNESS WHEREOF, VIDAMED, INC. has caused this Warrant to be
executed by its officers thereunto duly authorized.
Dated: [Date]
VIDAMED, INC.
By: ___________________________________
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇,
Vice President and Chief
Financial Officer
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NOTICE OF EXERCISE
To: VIDAMED, INC.
(1) The undersigned hereby elects to purchase ____________ shares of
Common Stock of VIDAMED, INC. pursuant to the terms of the attached Warrant, and
____ tenders herewith payment of the purchase price in full.
____ is electing to convert the Warrant on a "net exercise"
basis in accordance with Section 2(b) hereof.
[please check one of the foregoing lines]
(2) Please issue a certificate of certificates representing said shares
of Common Stock in the name of the undersigned or in such other name as is
specified below:
_______________________________________________
(Name)
________________________________________________
________________________________________________
(Address)
(3) The undersigned represents that the aforesaid shares of Common
Stock are being acquired for the account of the undersigned for investment and
not with a view to, or for resale in connection with, the distribution thereof
and that the undersigned has no present intention of distributing or reselling
such shares; provided, that such representation shall not be required at such
time as the shares of Common Stock underlying this Warrant are registered under
the Securities Act of 1933.
_______________________________ ______________________________
(Date) (Signature)
ASSIGNMENT FORM
(To assign the foregoing warrant, execute
this form and supply required information.
Do not use this form to purchase shares.)
FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced
thereby are hereby assigned to
_______________________________________________________________________
(Please Print)
whose address is ______________________________________________________
(Please Print)
_______________________________________________________________________
Dated:_______________________, 19____.
Holder's Signature:_______________________________
Holder's Address:_________________________________
__________________________________________________
Signature Guaranteed: _________________________________________________
NOTE: The signature to this Assignment Form must correspond with the name as it
appears on the face of the Warrant, without alteration or enlargement or any
change whatever, and must be guaranteed by a bank or trust company. Officers of
corporations and those acting in a fiduciary or other representative capacity
should file proper evidence of authority to assign the foregoing Warrant.