EXHIBIT 10.2
VOID AFTER 5:00 P.M., PACIFIC
TIME, ON NOVEMBER __, 2009
THIS WARRANT AND THE SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES OR ANY OTHER JURISDICTION. THE SECURITIES REPRESENTED HEREBY MAY
NOT BE OFFERED OR SOLD IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SECURITIES UNDER APPLICABLE SECURITIES LAWS UNLESS
OFFERED, SOLD OR TRANSFERRED PURSUANT TO AN AVAILABLE EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THOSE LAWS.
Right to Purchase [_______] Shares of
Common Stock, $.001 par value per share
Date: November __, 2004
LIFEPOINT, INC.
STOCK PURCHASE WARRANT NO. ___
THIS CERTIFIES THAT, for value received, __________________, or its
registered assigns, is entitled to purchase from LIFEPOINT, INC., a corporation
organized under the laws of the State of Delaware (the "COMPANY"), at any time
or from time to time during the Exercise Period (as defined in Section 2
hereof), ________________(________) fully paid and nonassessable shares of the
Company's common stock, $.001 par value per share (the "COMMON STOCK"), at an
exercise price per share (the "EXERCISE PRICE") equal to (i) $0.28 from the date
hereof through the one year anniversary of the date hereof (the "First Year
Exercise Price") if the exercise price is paid to the Company in cash, and (ii)
$0.40 from the one year anniversary of the date hereof through the expiration of
the Exercise Period. Notwithstanding the foregoing, the number of shares of the
Common Stock purchasable hereunder (the "WARRANT SHARES") and the Exercise Price
are subject to adjustment as provided in Section 4 hereof. The term "WARRANTS"
means this Warrant and the other warrants of the Company issued pursuant to that
certain Securities Purchase Agreement, dated as of the date hereof, by and among
the Company and the other signatories thereto (the "SECURITIES PURCHASE
AGREEMENT").
This Warrant is subject to the following terms, provisions and
conditions:
1. MANNER OF EXERCISE; ISSUANCE OF CERTIFICATES; PAYMENT FOR SHARES.
Subject to the provisions hereof, including, without limitation, the limitations
contained in Section 7 hereof, this Warrant may be exercised by the holder
hereof, in whole or in part, by the surrender of this Warrant, together with a
completed exercise agreement in the form attached hereto (the "EXERCISE
AGREEMENT"), to the Company by 4:30 p.m., Pacific time, on any business day at
the Company's principal executive offices (or such other office or agency of the
Company as it may designate by notice to the holder hereof) and upon (i) payment
to the Company in cash, by certified or official bank check or by wire transfer
for the account of the Company, of the Exercise Price for the Warrant Shares
specified in the Exercise Agreement or (ii) if the holder is effectuating a
Cashless Exercise (as defined below) delivery to the Company of a written notice
of an election to effect a Cashless Exercise for the Warrant Shares specified in
the Exercise Agreement; provided, however, that the holder shall not be
permitted to effectuate a Cashless Exercise with respect to the First Year
Exercise Price. This Warrant may be exercised at any time after the date hereof
until the end of the Exercise Period, by presentation and surrender of this
Warrant to the Company at its principal executive offices with a written notice
of the holder's intention to effect a cashless exercise, including a calculation
of the number of shares of the Common Stock to be issued upon such exercise in
accordance with the terms hereof (a "CASHLESS EXERCISE"). In the event of a
Cashless Exercise, in lieu of paying the Exercise Price in cash, the holder
shall surrender this Warrant for that number of shares of the Common Stock
determined by multiplying the number of Warrant Shares to which it would
otherwise be entitled by a fraction, the numerator of which shall be the
difference between the then current Market Price (as defined in Section 4(j)
below) of a share of the Common Stock on the date of exercise and the Exercise
Price, and the denominator of which shall be the then current Market Price per
share of the Common Stock. The Warrant Shares so purchased shall be deemed to be
issued to the holder hereof or such holder's designee, as the record owner of
such shares, as of the close of business on the date on which this Warrant shall
have been surrendered, the payment received by the Company and the completed
Exercise Agreement shall have been delivered or, if such date is not a business
date, on the next succeeding business date. The Warrant Shares so purchased,
representing the aggregate number of shares specified in the Exercise Agreement,
shall (by the Company or through its transfer agent) be delivered (i.e.,
deposited with a nationally recognized overnight courier service postage
prepaid) to the holder hereof within a reasonable time, not exceeding two (2)
business days, after this Warrant shall have been so exercised (the "DELIVERY
PERIOD"). If the Company's transfer agent is participating in the Depository
Trust Company ("DTC") Fast Automated Securities Transfer program, and so long as
the certificates therefor do not bear a legend pursuant to the terms of the
Securities Purchase Agreement and the holder is not obligated to return such
certificate for the placement of a legend thereon, (pursuant to the terms of the
Securities Purchase Agreement), the Company shall cause its transfer agent to
electronically transmit the Warrant Shares so purchased to the holder by
crediting the account of the holder or its nominee with DTC through its Deposit
Withdrawal Agent Commission system ("DTC TRANSFER"). If the aforementioned
conditions to a DTC Transfer are not satisfied, the Company shall deliver to the
holder physical certificates representing the Warrant Shares so purchased.
Further, the holder may instruct the Company to deliver to the holder physical
certificates representing the Warrant Shares so purchased in lieu of delivering
such shares by way of DTC Transfer. Any certificates so delivered shall be in
such denominations as may be reasonably requested by the holder hereof, shall be
registered in the name of such holder or such other name as shall be designated
by such holder and, following the date on which the Warrant Shares have been
registered under the Securities Act pursuant to that certain Registration Rights
Agreement, dated as of the date hereof, by and among the Company and the other
signatories thereto (the "REGISTRATION RIGHTS AGREEMENT") or otherwise may be
sold by the holder pursuant to Rule 144(k) promulgated under the Securities Act
(or a successor rule), shall not bear any restrictive legend. If this Warrant
shall have been exercised only in part, then, unless this Warrant has expired,
the Company shall, at its expense, at the time of delivery of such certificates,
deliver to the holder a new Warrant representing the number of shares with
respect to which this Warrant shall not then have been exercised.
If, at any time following the Company's receipt of the Stockholder
Approvals (as defined in the Securities Purchase Agreement), a holder of this
Warrant submits this Warrant and an Exercise Agreement and payment to the
Company of the Exercise Price for each of the Warrant Shares specified in the
Exercise Agreement (including pursuant to a Cashless Exercise), and the Company
fails for any reason to deliver, on or prior to the fourth (4th) business day
following the expiration of the Delivery Period for such exercise, the number of
shares of the Common Stock to which the holder is entitled upon such exercise
(an "EXERCISE DEFAULT"), then the Company shall pay to the holder payments
("EXERCISE DEFAULT PAYMENTS") for an Exercise Default in the amount of (a)
(N/365), multiplied by (b) the Market Price on the date the Exercise Agreement
giving rise to the Exercise Default is transmitted in accordance with this
Section 1 (the "EXERCISE DEFAULT DATE"), multiplied by (c) the number of shares
of the Common Stock the Company failed to so deliver in such Exercise Default,
multiplied by (d) .15, where N = the number of days from the Exercise Default
Date to the date that the Company effects the full exercise of this Warrant
which gave rise to the Exercise Default. The accrued Exercise Default Payment
for each calendar month shall be paid in cash or shall be convertible into
shares of the Common Stock, at the holder's option, as follows:
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a. In the event the holder elects to take such payment in
cash, cash payment shall be made to holder by the fifth (5th) day of the month
following such election; and
b. In the event the holder elects to take such payment in
shares of the Common Stock, the holder may convert such payment amount into
shares of the Common Stock at the lower of the Exercise Price or the Market
Price (as defined in Section 4(j)) (as in effect at the time of conversion) at
any time after the fifth (5th) day of the month following the month in which it
has accrued.
Nothing herein shall limit the holder's right, following the
Company's receipt of the Stockholder Approvals, to pursue actual damages for the
Company's failure to maintain a sufficient number of authorized shares of the
Common Stock as required pursuant to the terms of Section 3(b) hereof or to
otherwise issue shares of the Common Stock upon exercise of this Warrant in
accordance with the terms hereof, and the holder shall have the right to pursue
all remedies available at law or in equity (including a decree of specific
performance and/or injunctive relief).
2. PERIOD OF EXERCISE. This Warrant is immediately exercisable, at any
time or from time to time on or after the date of initial issuance of this
Warrant (the "ISSUE DATE") and before 4:30 p.m., Pacific time, on that date
which is five (5) years after the Issue Date (the "EXERCISE PERIOD"). Commencing
on _________ __, 2004, the Exercise Period shall automatically be extended by
one (1) day for each day during the Exercise Period (or any extension thereof)
on which the Company does not have a number of shares of Common Stock reserved
for issuance upon exercise hereof at least equal to the number of shares of
Common Stock issuable upon exercise hereof.
3. CERTAIN AGREEMENTS OF THE COMPANY. The Company hereby covenants and
agrees as follows:
a. SHARES TO BE FULLY PAID. All Warrant Shares will, upon
issuance in accordance with the terms of this Warrant, be validly issued, fully
paid, and nonassessable and free from all taxes, liens, claims and encumbrances.
b. RESERVATION OF SHARES. During the Exercise Period, subject
to the Company's receipt of the Stockholder Approvals, the Company shall at all
times have authorized, and reserved for the purpose of issuance upon exercise of
this Warrant, a sufficient number of shares of the Common Stock to provide for
the exercise in full of this Warrant (without giving effect to the limitations
on exercise set forth in Section 7(g) hereof).
c. LISTING. Following the Company's receipt of the Stockholder
Approvals, the Company shall promptly secure the listing of the shares of the
Common Stock issuable upon exercise of this Warrant upon each national
securities exchange or automated quotation system, if any, upon which shares of
the Common Stock are then listed or become listed (subject to official notice of
issuance upon exercise of this Warrant) and shall maintain, so long as any other
shares of the Common Stock shall be so listed, such listing of all shares of the
Common Stock from time to time issuable upon the exercise of this Warrant; and
the Company shall so list on each national securities exchange or automated
quotation system, as the case may be, and shall maintain such listing of, any
other shares of capital stock of the Company issuable upon the exercise of this
Warrant if and so long as any shares of the same class shall be listed on such
national securities exchange or automated quotation system.
d. CERTAIN ACTIONS PROHIBITED. The Company will not, by
amendment of its Certificate of Incorporation or through any reorganization,
transfer of assets, consolidation, merger, dissolution, issue or sale of
securities, or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms to be observed or performed by it hereunder,
but will at all times in good faith assist in the carrying out of all the
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provisions of this Warrant and in the taking of all such action as may
reasonably be requested by the holder of this Warrant in order to protect the
economic benefit inuring to the holder hereof and the exercise privilege of the
holder of this Warrant against dilution or other impairment, consistent with the
tenor and purpose of this Warrant. Without limiting the generality of the
foregoing, the Company (i) will not increase the par value of any shares of the
Common Stock receivable upon the exercise of this Warrant above the Exercise
Price then in effect, and (ii) will take all such actions as may be necessary or
appropriate in order that the Company may validly and legally issue fully paid
and nonassessable shares of the Common Stock upon the exercise of this Warrant.
e. SUCCESSORS AND ASSIGNS. This Warrant will be binding upon
any entity succeeding to the Company by merger, consolidation, or acquisition of
all or substantially all of the Company's assets.
f. BLUE SKY LAWS. In the event the issuance of the Warrant
Shares is not within an applicable exemption thereto, the Company shall, on or
before the date of issuance of any Warrant Shares, take such actions as the
Company shall reasonably determine are necessary to qualify the Warrant Shares
for, or obtain exemption for the Warrant Shares for, sale to the holder of this
Warrant upon the exercise hereof under applicable securities or "blue sky" laws
of the states of the United States, and shall provide evidence of any such
action so taken to the holder of this Warrant prior to such date; provided,
however, that the Company shall not be required to qualify as a foreign
corporation or file a general consent to service of process in any such
jurisdiction.
4. ANTIDILUTION PROVISIONS. During the Exercise Period, the Exercise
Price and the number of Warrant Shares issuable hereunder and for which this
Warrant is then exercisable pursuant to Section 2 hereof shall be subject to
adjustment from time to time as provided in this Section 4. In the event that
any adjustment of the Exercise Price as required herein results in a fraction of
a cent, such Exercise Price shall be rounded up or down to the nearest cent.
a. SUBDIVISION OR COMBINATION OF THE COMMON STOCK. If the
Company, at any time during the Exercise Period, subdivides (by any stock split,
stock dividend, recapitalization, reorganization, reclassification or otherwise)
its shares of the Common Stock into a greater number of shares, then, after the
date of record for effecting such subdivision, the Exercise Price in effect
immediately prior to such subdivision will be proportionately reduced. If the
Company, at any time during the Exercise Period, combines (by reverse stock
split, recapitalization, reorganization, reclassification or otherwise) its
shares of the Common Stock into a smaller number of shares, then, after the date
of record for effecting such combination, the Exercise Price in effect
immediately prior to such combination will be proportionately increased.
b. ADJUSTMENT IN NUMBER OF SHARES. Upon each adjustment of the
Exercise Price pursuant to the provisions of this Section 4, the number of
shares of the Common Stock issuable upon exercise of this Warrant and for which
this Warrant is or may become exercisable shall be adjusted by multiplying a
number equal to the Exercise Price in effect immediately prior to such
adjustment by the number of shares of the Common Stock issuable or for which
this Warrant is or may become exercisable (as applicable) upon exercise of this
Warrant immediately prior to such adjustment and dividing the product so
obtained by the adjusted Exercise Price.
c. CONSOLIDATION, MERGER OR SALE. In case of any consolidation
of the Company with, or merger of the Company into, any other corporation, or in
case of any sale or conveyance of all or substantially all of the assets of the
Company other than in connection with a plan of complete liquidation of the
Company at any time during the Exercise Period, then as a condition of such
consolidation, merger or sale or conveyance, adequate provision will be made
whereby the holder of this Warrant will have the right to acquire and receive
upon exercise of this Warrant in lieu of the shares of the Common Stock
immediately theretofore acquirable upon the exercise of this Warrant, such
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shares of stock, securities, cash or assets as may be issued or payable with
respect to or in exchange for the number of shares of the Common Stock
immediately theretofore acquirable and receivable upon exercise of this Warrant
had such consolidation, merger or sale or conveyance not taken place. In any
such case, the Company will make appropriate provision to insure that the
provisions of this Section 4 hereof will thereafter be applicable as nearly as
may be in relation to any shares of stock or securities thereafter deliverable
upon the exercise of this Warrant. The Company will not effect any
consolidation, merger or sale or conveyance unless prior to the consummation
thereof, the successor corporation (if other than the Company) assumes by
written instrument the obligations under this Warrant and the obligations to
deliver to the holder of this Warrant such shares of stock, securities or assets
as, in accordance with the foregoing provisions, the holder may be entitled to
acquire. Notwithstanding the foregoing, in the event of any such sale or
conveyance, the holder of this Warrant shall, at its option, have the right to
receive cash consideration equal to the fair market value of this Warrant as
determined in accordance with customary valuation methodology used in the
investment banking industry if any such merger, consolidation, sale or
conveyance either involves (x) the receipt of cash consideration by the equity
holders of the Company's capital stock or (y) (i) the sale of the securities
issuable upon exercise of all Warrants immediately following such event is not
either registered with the Securities and Exchange Commission or exempt from all
applicable federal and state registration requirements and such securities are
not listed for trading on the New York Stock Exchange, the American Stock
Exchange (the "AMEX"), the Nasdaq National Market or the Nasdaq SmallCap Market,
and (ii) the average weekly reported volume of trading of such securities on the
principal exchange or market on which such securities are traded for the twelve
(12) calendar weeks immediately preceding the public announcement of such
transaction, is less than the product of the aggregate number of shares issuable
upon exercise of all Warrants following such event and ten (10).
d. DISTRIBUTION OF ASSETS. In case the Company shall declare
or make any distribution of its assets (or rights to acquire its assets) to
holders of the Common Stock as a partial liquidating dividend, stock repurchase
by way of return of capital or otherwise (including any dividend or distribution
to the Company's stockholders of cash or shares (or rights to acquire shares) of
capital stock of a subsidiary) (a "DISTRIBUTION"), at any time during the
Exercise Period, then the holder of this Warrant shall be entitled upon exercise
of this Warrant for the purchase of any or all of the shares of the Common Stock
subject hereto, to receive the amount of such assets (or rights) which would
have been payable to the holder had such holder been the holder of such shares
of the Common Stock on the record date for the determination of stockholders
entitled to such Distribution. If the Company distributes rights, warrants,
options or any other form of convertible securities and the right to exercise or
convert such securities would expire in accordance with their terms prior to the
expiration of the Exercise Period, then the terms of such securities shall
provide that such exercise or convertibility right shall remain in effect until
30 days after the date the holder hereof receives such securities pursuant to
the exercise hereof.
e. NOTICE OF ADJUSTMENT. Upon the occurrence of any event
which requires any adjustment of the Exercise Price, then, and in each such
case, the Company shall give notice thereof to the holder of this Warrant, which
notice shall state the Exercise Price resulting from such adjustment and the
increase or decrease in the number of Warrant Shares purchasable at such price
upon exercise, setting forth in reasonable detail the method of calculation and
the facts upon which such calculation is based. Such calculation shall be
certified by the chief financial or accounting officer of the Company.
f. MINIMUM ADJUSTMENT OF EXERCISE PRICE. No adjustment of the
Exercise Price shall be made in an amount of less than 1% of the Exercise Price
in effect at the time such adjustment is otherwise required to be made, but any
such lesser adjustment shall be carried forward and shall be made at the time
and together with the next subsequent adjustment which, together with any
adjustments so carried forward, shall amount to not less than 1% of such
Exercise Price.
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g. NO FRACTIONAL SHARES. No fractional shares of the Common
Stock are to be issued upon the exercise of this Warrant, but the Company shall
pay a cash adjustment in respect of any fractional share which would otherwise
be issuable in an amount equal to the same fraction of the Market Price of a
share of the Common Stock on the date of such exercise.
h. OTHER NOTICES. In case at any time:
i. the Company shall declare any dividend upon the Common
Stock payable in shares of stock of any class or make any other distribution
(other than dividends or distributions payable in cash out of retained earnings
consistent with the Company's past practices with respect to declaring dividends
and making distributions) to the holders of the Common Stock;
ii. the Company shall offer for subscription pro rata
to the holders of the Common Stock any additional shares of stock of any class
or other rights;
iii. there shall be any capital reorganization of the
Company, or reclassification of the Common Stock, or consolidation or merger of
the Company with or into, or sale of all or substantially all of its assets to,
another corporation or entity; or
iv. there shall be a voluntary or involuntary
dissolution, liquidation or winding-up of the Company;
then, in each such case, the Company shall give to the holder of this Warrant
(a) notice of the date on which the books of the Company shall close or a record
shall be taken for determining the holders of the Common Stock entitled to
receive any such dividend, distribution, or subscription rights or for
determining the holders of the Common Stock entitled to vote in respect of any
such reorganization, reclassification, consolidation, merger, sale, dissolution,
liquidation or winding-up and (b) in the case of any such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation or
winding-up, notice of the date (or, if not then known, a reasonable estimate
thereof by the Company) when the same shall take place. Such notice shall also
specify the date on which the holders of the Common Stock shall be entitled to
receive such dividend, distribution, or subscription rights or to exchange their
shares of the Common Stock for stock or other securities or property deliverable
upon such reorganization, reclassification, consolidation, merger, sale,
dissolution, liquidation, or winding-up, as the case may be. Such notice shall
be given at least ten (10) days prior to the record date or the date on which
the Company's books are closed in respect thereto, but in no circumstance prior
to the information being publicly disclosed. Failure to give any such notice or
any defect therein shall not affect the validity of the proceedings referred to
in clauses (i), (ii), (iii) and (iv) above. Notwithstanding the foregoing, the
Company shall publicly disclose the substance of any notice delivered hereunder
prior to delivery of such notice to the holder of this Warrant.
i. CERTAIN EVENTS. If, at any time during the Exercise Period,
any event occurs of the type contemplated by the adjustment provisions of this
Section 4 but not expressly provided for by such provisions, the Company will
give notice of such event as provided in Section 4(e) hereof, and the Company's
Board of Directors will make an appropriate adjustment in the Exercise Price and
the number of shares of the Common Stock acquirable upon exercise of this
Warrant so that the rights of the holder shall be neither enhanced nor
diminished by such event.
j. CERTAIN DEFINITIONS.
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i. "MARKET PRICE" means, for any security as of any
date, the volume weighted average price of such security for the twenty (20)
consecutive days immediately preceding such date on the AMEX or other principal
trading market where such security is listed or traded as reported by Bloomberg
Financial Markets (or a comparable reporting service of national reputation
selected by the Company and reasonably acceptable to holders of a at least 50.1%
of the then outstanding shares of Series E Preferred Stock ("MAJORITY HOLDERS")
if Bloomberg Financial Markets is not then reporting closing sales prices of
such security) (collectively, "BLOOMBERG"), or if the foregoing does not apply,
the last reported sales price of such security on a national exchange or in the
over-the-counter market on the electronic bulletin board for such security as
reported by Bloomberg, or, if no such price is reported for such security by
Bloomberg, the average of the bid prices of all market makers for such security
as reported in the "pink sheets" by the National Quotation Bureau, Inc., in each
case for such date or, if such date was not a trading day for such security, on
the next preceding date which was a trading day. If the Market Price cannot be
calculated for such security as of either of such dates on any of the foregoing
bases, the Market Price of such security on such date shall be the fair market
value as reasonably determined by an investment banking firm selected by the
Company and reasonably acceptable to the Majority Holders, with the costs of
such appraisal to be borne by the Company.
ii. "COMMON STOCK," for purposes of this Section 4,
includes the Common Stock and any additional class of stock of the Company
having no preference as to dividends or distributions on liquidation, provided
that the shares purchasable pursuant to this Warrant shall include only shares
of the Common Stock in respect of which this Warrant is exercisable, or shares
resulting from any subdivision or combination of the Common Stock, or in the
case of any reorganization, reclassification, consolidation, merger, or sale of
the character referred to in Section 4(c) hereof, the stock or other securities
or property provided for in such Section.
5. ISSUE TAX. The issuance of certificates for Warrant Shares upon the
exercise of this Warrant shall be made without charge to the holder of this
Warrant or such shares for any issuance tax or other costs in respect thereof,
provided that the Company shall not be required to pay any tax which may be
payable in respect of any transfer involved in the issuance and delivery of any
certificate in a name other than the holder of this Warrant.
6. NO RIGHTS OR LIABILITIES AS A STOCKHOLDER. This Warrant shall not
entitle the holder hereof to any voting rights or other rights as a stockholder
of the Company. No provision of this Warrant, in the absence of affirmative
action by the holder hereof to purchase Warrant Shares, and no mere enumeration
herein of the rights or privileges of the holder hereof, shall give rise to any
liability of such holder for the Exercise Price or as a stockholder of the
Company, whether such liability is asserted by the Company or by creditors of
the Company.
7. TRANSFER, EXCHANGE, REDEMPTION AND REPLACEMENT OF WARRANT.
a. RESTRICTION ON TRANSFER. This Warrant and the rights
granted to the holder hereof are transferable, in whole or in part, upon
surrender of this Warrant, together with a properly executed assignment in the
form attached hereto, at the office or agency of the Company referred to in
Section 7(e) below, provided, however, that any transfer or assignment shall be
subject to the conditions set forth in Sections 7(f) and (g) hereof and to the
provisions of Sections 2(f) and 2(g) of the Securities Purchase Agreement,
provided further, that this Warrant and the rights granted to the holder hereof
are not transferable to direct competitors of the Company or persons or entities
that have announced plans to compete directly with the Company. Until due
presentment for registration of transfer on the books of the Company, the
Company may treat the registered holder hereof as the owner and holder hereof
for all purposes, and the Company shall not be affected by any notice to the
contrary. Notwithstanding anything to the contrary contained herein, the
registration rights described in Section 8 hereof are assignable only in
accordance with the provisions of the Registration Rights Agreement.
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b. WARRANT EXCHANGEABLE FOR DIFFERENT DENOMINATIONS. This
Warrant is exchangeable, upon the surrender hereof by the holder hereof at the
office or agency of the Company referred to in Section 7(e) below, for new
Warrants of like tenor of different denominations representing in the aggregate
the right to purchase the number of shares of the Common Stock which may be
purchased hereunder, each of such new Warrants to represent the right to
purchase such number of shares as shall be designated by the holder hereof at
the time of such surrender and all such warrants thereafter constituting the
Warrant referenced herein..
c. REPLACEMENT OF WARRANT. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction, or mutilation of
this Warrant and, in the case of any such loss, theft, or destruction, upon
delivery of an indemnity agreement reasonably satisfactory in form and amount to
the Company, or, in the case of any such mutilation, upon surrender and
cancellation of this Warrant, the Company, at its expense, will execute and
deliver, in lieu thereof, a new Warrant of like tenor.
d. CANCELLATION; PAYMENT OF EXPENSES. Upon the surrender of
this Warrant in connection with any transfer, exchange, or replacement as
provided in this Section 7, this Warrant shall be promptly canceled by the
Company. The Company shall pay all taxes (other than securities transfer taxes)
and all other expenses (other than legal expenses, if any, incurred by the
holder or transferees) and charges payable in connection with the preparation,
execution, and delivery of Warrants pursuant to this Section 7. The Company
shall hold harmless and indemnify the holder of this Warrant from and against,
and shall compensate and reimburse such holder for, any damages which are
directly or indirectly suffered or incurred by such holder or to which such
holder may otherwise become subject (regardless of whether or not such damages
relate to any third party claim) (including legal fees) and which arise from or
as a result of, or are directly or indirectly connected with any breach of any
of the Company's covenants set forth herein, including, but not limited to, all
costs in connection with the enforcement of its rights hereunder.
e. WARRANT REGISTER. The Company shall maintain, at its
principal executive offices (or such other office or agency of the Company as it
may designate by notice to the holder hereof), a register for this Warrant, in
which the Company shall record the name and address of the person in whose name
this Warrant has been issued, as well as the name and address of each transferee
and each prior owner of this Warrant.
f. EXERCISE OR TRANSFER WITHOUT REGISTRATION. If, at the time
of the surrender of this Warrant in connection with any exercise, transfer, or
exchange of this Warrant, this Warrant (or, in the case of any exercise, the
Warrant Shares issuable hereunder), shall not be registered under the Securities
Act and under applicable state securities or blue sky laws, the Company may
require, as a condition of allowing such exercise, transfer, or exchange, (i)
delivery to the Company of a written opinion of legal counsel (which opinion
shall be in form, substance and scope customary for opinions of counsel in
comparable transactions and reasonably acceptable to the Company) to the effect
that such exercise, transfer, or exchange may be made without registration under
the Securities Act and under applicable state securities or blue sky laws, (ii)
that the holder or transferee execute and deliver to the Company an investment
letter in form and substance reasonably acceptable to the Company, confirming
such matters as shall be required by applicable securities laws, and (iii) that
the transferee be an "accredited investor" as defined in Rule 501(a) promulgated
under the Securities Act; provided that no such opinion, letter, or status as an
"accredited investor" shall be required in connection with a transfer pursuant
to Rule 144 under the Securities Act.
g. ADDITIONAL RESTRICTIONS ON EXERCISE OR TRANSFER.
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i. In no event shall the holder hereof have the right
to exercise any portion of this Warrant for shares of Common Stock or to dispose
of any portion of this Warrant to the extent that such right to effect such
exercise or disposition would result in the holder or any of its affiliates
together beneficially owning more than the greater of (a) 4.99% of the
outstanding shares of Common Stock or (b) that percentage of the outstanding
shares of Common Stock held by such holder and its affiliates immediately prior
to the Issue Date (including in such calculation any shares of Common Stock
underlying warrants to purchase Common Stock (other than this Warrant) held by
such holder immediately prior to the Issue Date); provided, however, that a
holder who, prior to the date of this Warrant, has expressed its desire not to
be bound by the foregoing limitation, may not be bound by such limitations to
the extent that they have heretofore entered into an agreement with the Company
not to be so bound by such limitation. For purposes of this Section 7(g),
beneficial ownership shall be determined in accordance with Section 13(d) of the
Securities Exchange Act of 1934, as amended, and Regulation 13D-G thereunder.
The restriction contained in this Section 7(g) may not be altered, amended,
deleted or changed in any manner whatsoever unless the holders of a majority of
the outstanding shares of Common Stock and the holder hereof shall approve, in
writing, such alteration, amendment, deletion or change. Notwithstanding the
forgoing, this Section 7(g) shall not apply to any party to the Securities
Purchase Agreement who notifies the Corporation in writing that this Section
7(g) shall not be applicable to such holder.
ii. Until the Company has obtained the Stockholder
Approvals, the aggregate number of shares of Common Stock that may be issued by
the Company (in exercise of this Warrant, conversion of the Series E Preferred
Stock, or otherwise in connection with the Securities Purchase Agreement) shall
be limited to ensure that the total aggregate number of shares of Common Stock
issued to the Holders does not exceed 19.999% of the total number of issued and
outstanding shares of Common Stock at the time of the Issuance Date.
iii. If at anytime following receipt of the
Stockholder Approvals the Company is prohibited by Rule 713 of the AMEX Company
Guide or any successor or similar rule, or the rules of any other securities
exchange or automated quotation system on which the Common Stock is then listed
or traded (a "TRIGGERING EVENT"), from issuing all of the shares of Common Stock
issuable upon complete exercise of the Warrants, the Company shall immediately
notify the holders of the Warrants of such Triggering Event and, within a period
of five (5) days after the occurrence of such Triggering Event, purchase from
each such holder, at a per share purchase price of an amount equal to the
greater of (a) the then applicable Conversion Price plus the difference between
the then applicable Conversion Price and the Market Price and (b) the then
applicable Conversion Price multiplied by 1.25 (the "PER SHARE PRICE"), such
whole number of Warrants such that the Common Stock issuable upon complete
exercise of the Warrants is no longer prohibited by Rule 713 of the AMEX Company
Guide (or any successor or similar rule) or the rules of any other securities
exchange or automated quotation system on which the Common Stock is then listed
or traded.
8. REGISTRATION RIGHTS. The initial holder of this Warrant (and certain
assignees thereof) is entitled to the benefit of such registration rights in
respect of the Warrant Shares as are set forth in the Registration Rights
Agreement, including the right to assign such rights to certain assignees, as
set forth therein.
9
9. NOTICES. Any notices required or permitted to be given under the
terms of this Warrant shall be sent by certified or registered mail (return
receipt requested) or delivered personally or by courier or by confirmed
telecopy, and shall be effective upon receipt or refusal of receipt, if
delivered personally or by courier, or by confirmed telecopy, in each case
addressed to a party. The addresses for such communications shall be:
10. If to the Company:
LifePoint, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Chief Executive Officer
with a copy to:
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇, Esq.
If to the holder, at such address as such holder shall have provided in writing
to the Company, or at such other address as such holder furnishes by notice
given in accordance with this Section 9.
11. GOVERNING LAW; JURISDICTION. This Warrant shall be governed by and
construed in accordance with the laws of the State of Delaware without regard to
principles of choice of law or conflicts of law. The Company irrevocably
consents to the jurisdiction of the United States federal courts and state
courts located in the County and State of Delaware in any suit or proceeding
based on or arising under this Warrant and irrevocably agrees that all claims in
respect of such suit or proceeding shall be determined exclusively in such
courts. The Company irrevocably waives any objection to the laying of venue and
the defense of an inconvenient forum to the maintenance of such suit or
proceeding. The Company further agrees that service of process upon the Company
mailed by certified or registered mail shall be deemed in every respect
effective service of process upon the Company in any such suit or proceeding;
provided that nothing herein shall prevent the Company from seeking to remove
from the state court to the federal court or vice versa. Nothing herein shall
affect the holder's right to serve process in any other manner permitted by law.
The Company agrees that a final non-appealable judgment in any such suit or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on such judgment or in any other lawful manner.
12. MISCELLANEOUS.
a. AMENDMENTS. This Warrant and any provision hereof may only
be amended by an instrument in writing signed by the Company and the holder
hereof.
b. DESCRIPTIVE HEADINGS. The descriptive headings of the
several Sections of this Warrant are inserted for purposes of reference only,
and shall not affect the meaning or construction of any of the provisions
hereof.
10
c. BUSINESS DAY. For purposes of this Warrant, the term
"business day" means any day, other than a Saturday or Sunday or a day on which
banking institutions in the State of New York are authorized or obligated by
law, regulation or executive order to close.
d. INDEMNIFICATION BY COMPANY.
i. The Company shall hold harmless and indemnify the
holder of this Warrant from and against, and shall compensate and reimburse such
holder for, any damages which are directly or indirectly suffered or incurred by
such holder or to which such holder may otherwise become subject (regardless of
whether or not such damages relate to any third-party claim) and which arise
from or as a result of, or are directly or indirectly connected with any breach
of any of the Company's covenants set forth herein.
ii. In the event of the assertion or commencement by
any person of any claim or legal proceeding with respect to which the holder may
have indemnification rights pursuant to this Section 12(d)(i), the holder shall
promptly notify the Company thereof in writing, but the failure to so notify the
Company will not limit the holder's rights to indemnification hereunder, except
to the extent the Company demonstrates that the defense of such action is
prejudiced by the failure to so give such notice. Within a reasonable time of
receipt of such notice, the Company may at its election participate at its own
expense in the defense of such claim or assume the defense of any such claim
with counsel chosen by the Company; provided, however, that if the defendants in
any such action include such holder and the Company and the holder shall have
been advised by its counsel that there may be legal defenses available to the
holder which are different from or additional to and in conflict with or present
a potential conflict with those available to the Company, such holder shall have
the right to employ its own counsel in such action, and in such event the
reasonable fees and expenses of such counsel shall be borne by the Company. If
the Company assumes the defense of such claim and no conflict exists permitting
the holder to retain separate counsel pursuant to the immediately preceding
sentence, the Company shall have no obligation to pay any fees or expenses of
any counsel retained the holder or any other person entitled to indemnification
hereunder in connection with such a claim. The holder shall not settle any claim
in respect of which indemnification shall be sought hereunder without the prior
written consent of the Company. The Company shall not be liable for any
settlement of any action, claim, suit or proceeding (or for any related losses,
damages, liabilities, costs or expenses) if such settlement is effectuated
without its written consent, which shall not be unreasonably withheld.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
11
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by
its duly authorized officer.
LIFEPOINT, INC.
By:
-----------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: President and CEO
12
FORM OF EXERCISE AGREEMENT
(TO BE EXECUTED BY THE HOLDER IN ORDER TO EXERCISE THE WARRANT)
To: LifePoint, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Chief Executive Officer
The undersigned hereby irrevocably exercises the right to purchase
_____________ shares of the Common Stock of LifePoint, Inc., a corporation
organized under the laws of the State of Delaware (the "COMPANY"), evidenced by
the attached Warrant, in accordance with the conditions and provisions of said
Warrant. The undersigned shall submit as payment for such purchase, at the
option of the holder, either (i) an amount equal to the product of the Exercise
Price multiplied by the number of shares being purchased hereby, or (ii)
forfeiture of a number of shares of the Common Stock which would have been
issuable under the Warrant equal to the aggregate Exercise Price payable for
such exercise divided by the Market Price. All capitalized terms used herein and
not otherwise defined shall have the meanings ascribed to such terms in the
Warrant.
The undersigned agrees not to offer, sell, transfer or otherwise
dispose of any Common Stock obtained on exercise of the Warrant, except under
circumstances that will not result in a violation of the Securities Act of 1933,
as amended, or any state securities laws.
|_| The undersigned requests that the Company cause its transfer agent to
electronically transmit the shares of the Common Stock issuable
pursuant to this Exercise Agreement to the account of the undersigned
or its nominee (which is _________________) with DTC through its
Deposit Withdrawal Agent Commission System ("DTC TRANSFER").
|_| In lieu of receiving the shares of the Common Stock issuable pursuant
to this Exercise Agreement by way of DTC Transfer, the undersigned
hereby requests that the Company cause its transfer agent to issue and
deliver to the undersigned physical certificates representing such
shares of the Common Stock.
The undersigned requests that a Warrant representing any unexercised
portion hereof be issued, pursuant to the Warrant, in the name of the Holder and
delivered to the undersigned at the address set forth below:
Dated:________________________ ________________________________________
Signature of Holder
________________________________________
Name of Holder
Address:
________________________________________
________________________________________
PHONE:
________________________________________
FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and
transfers all the rights of the undersigned under the within Warrant, with
respect to the number of shares of the Common Stock covered thereby set forth
hereinbelow, to:
NAME OF ▇▇▇▇▇▇▇▇ ADDRESS NO. OF SHARES
---------------- ------- -------------
, and hereby irrevocably constitutes and appoints
_____________________________________ as agent and attorney-in-fact to transfer
said Warrant on the books of the within-named corporation, with full power of
substitution in the premises.
Dated:______________________
In the presence of
____________________________ Name:_________________________________________
Signature:____________________________________
Title of Signing Officer or Agent (if any):
Address:
______________________________________________
______________________________________________
Note: The above signature should
correspond exactly with the name on
the face of the within Warrant.