THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933. AS
AMENDED OR UNDER THE SECURITIES LAWS OF ANY STATE AND NOT BE OFFERED OR SOLD IN
CONTRAVENTION OF THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE
LAWS OR THE RESTRICTIONS CONTAINED IN THIS WARRANT
WARRANT TO SUBSCRIBE FOR AND PURCHASE
500,000 SHARES OF COMMON STOCK
DATAMETRICS CORPORATION
THIS WARRANT CERTIFIES THAT, for value received, XXXXXX X. XXXXXX, XX.
or registered assigns is entitled to subscribe for the purchase from Datametrics
Corporation, a Delaware corporation (the "Company"), at any time after the date
hereof to and including November 13, 2001 (the "Expiration Date"), five hundred
thousand (500,000) fully paid and non-assessable shares of the Common Stock, par
value $.01 per share (the "Common Stock"), of the Company.
METHOD OF EXERCISE PAYMENT; PRICE: ISSUANCE OF NEW WARRANT;
TRANSFER AND EXCHANGE. This Warrant (the "Warrant") may be exercised by the
holder hereof, during any period set forth above, in whole or in part (but not
as to a fractional share of Common Stock), by the surrender of this Warrant,
together with the exercise form attached hereto as Exhibit "A" (the "Exercise
Form") duly completed and signed, at the principal office of the Company, and by
payment to the Company by certified or cashier's check of the Warrant Price. For
the purposes of this Warrant, the term "Warrant Price" shall mean $2.00 per
share of Common Stock or such other price as shall result from the adjustments
specified in Section 2 hereof. The Company agrees that the shares so purchased
shall be deemed to be issued to the holder hereof as the record owner of such
shares as of the close of business on the date on which this Warrant shall have
been surrendered and payment made for such shares as aforesaid shall have been
made. In the event of any exercise of this Warrant, certificates for the shares
of Common Stock so purchased shall be delivered to the holder hereof within a
reasonable time after this Warrant shall have been so exercised. Unless this
Warrant has expired, a new warrant representing the right to purchase the number
of shares of Common Stock, if any, with respect to which this Warrant shall not
then have been exercised, shall also be issued to the holder hereof at such
time.
The Warrant shall be transferable only on the books of the Company
maintained at its principal office upon delivery thereof by the holder or by its
duly authorized attorney or representative, or accompanied by proper evidence of
succession, assignment or authority to transfer, together with the form of the
assignment, attached hereto as Exhibit "B" (the "Assignment Form") duly
completed and signed.
1. STOCK FULLY PAID; RESERVATION OF SHARES. The Company covenants and
agrees that all shares of Common Stock shall, upon issuance pursuant to the
exercise of this Warrant and payment of the Warrant Price, be fully paid and
nonassessable and free from all liens and encumbrances with respect to the
issuance thereof. The Company further covenants and agrees that during the
period within which this Warrant may be exercised, the Company shall at all
times have authorized and reserved, for the purpose of the issuance upon
exercise of this Warrant, at least the maximum number of shares of Common Stock
as are issuable upon the exercise of this Warrant.
2. ADJUSTMENT OF WARRANT PRICE AND NUMBER OF SHARES OF COMMON STOCK.
The number and kind of securities purchasable upon the exercise of this Warrant
and the Warrant Price shall be subject to adjustment from time to time as
follows:
(a) if the Company shall (i) subdivide its outstanding shares
of Common Stock, (ii) combine its outstanding shares of Common Stock into a
smaller number of shares, or (iii) issue by reclassification of its shares of
Common Stock any shares or other securities of the Company, then, in each such
event, the number of shares of Common Stock purchasable upon exercise of this
Warrant immediately prior thereto, shall be adjusted so that the holder of this
Warrant shall be entitled to receive after the occurrence of any of the events
described above, had such Warrant been exercised immediately prior to the
occurrence of such event (or any record date with respect thereto). Such
adjustment shall be made whenever any of the events listed above shall occur. An
adjustment made pursuant to this paragraph (a) shall become effective
immediately after the effective date of the event retroactive to the record
date, if any, for such event.
(b) Upon a Change in Control (as defined below) of the Company
at any time during the period commencing on the date hereof and continuing for
12 months thereafter the Warrant Price shall be reduced to $1.25 per share of
Common Stock.
(A) For purposes of this Warrant, a "Change in
Control" shall mean:
(i) The acquisition (other than by or from the
Company), at any time after the date hereof, by any person, entity or "group",
within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange
Act of 1934 (the "Exchange Act"), of beneficial ownership (within the meaning of
Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either the then
outstanding shares of common stock or the combined voting power of the Company's
then outstanding voting securities entitled to vote generally in the election of
directors (together with such common stock. "Voting Securities"); or
(ii) The four (4) individuals who, as of the
date hereof, constitute the Board (as of the date hereof the "Incumbent Board")
cease for any reason to
constitute at least a majority of the Board, provided that any person becoming a
director subsequent to the date hereof whose election, or nomination for
election by the Company's shareholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board (other than an
election or nomination of an individual whose initial assumption of office is in
connection with an actual or threatened election contents relating to the
election of the directors of the Company, as such terms are used in Rule 14a-11
of Regulation 14A promulgated under the Exchange Act) shall be, for purposes of
this Agreement, considered as though such person were a member of the Incumbent
Board; or
(iii) Approval by the shareholders of the
Company of (x) a reorganization, merger or consolidation with respect to which
persons who were the shareholders of the Company immediately prior to such
reorganization, merger or consolidation do not, immediately thereafter, own more
than 50% of the combined voting power entitled to vote generally in the election
of directors of the reorganized, merged or consolidated company's then
outstanding voting securities, (y) a liquidation or dissolution of the Company
or (z) the sale o fall or substantially all of the assets of the Company, unless
the approved reorganization, merger, consolidation, liquidation, dissolution or
sale is subsequently abandoned.
(c) No adjustment in the number of shares of Common Stock
purchasable under this Warrant shall be required unless the adjustment would
require an increase or decrease of at least one percent in the number of shares
of Common Stock purchasable upon the exercise of this Warrant. Any adjustments
which by reason of this paragraph (c) are not required to be made shall be
carried forward and taken into account in any subsequent adjustment. All
calculations under this Section 2 shall be made to the nearest one hundredth of
a share or to the nearest cent, as the case may be.
(d) Whenever the number of shares of Common Stock purchasable
upon the exercise of this Warrant is adjusted, the Warrant Price per share of
Common Stock payable upon exercise of each Warrant shall be adjusted by
multiplying such Warrant Price immediately prior to such adjustment by a
fraction, the numerator of which shall be the number of shares of Common Stock
purchasable upon the exercise of each Warrant immediately prior to such
adjustment, and the denominator of which shall be the number of shares of Common
Stock purchasable immediately after such adjustment.
(e) Whenever the number of shares of Common Stock purchasable
upon the exercise of this Warrant or the Warrant Price of such shares of Common
Stock is adjusted, the Company shall promptly mail by first class mail, postage
prepaid, to the holder of this Warrant notice of such adjustment or adjustments,
together with a certificate setting forth the number of shares of Common Stock
purchasable upon the exercise of this Warrant and the Warrant price of the
shares of Common Stock after the adjustment, a brief statement of the facts
requiring such an adjustment, and the computation by which such adjustment was
made.
(f) For the purpose of this Section 2, the term "shares of
Common Stock" means the Common Stock of the Company of the class authorized at
the date of this Warrant and stock of any other class into which such presently
authorized shares of Common Stock may be changed and any other shares of stock
of the Company which do not have priority in the payment of dividends or upon
liquidation over any other class of stock. In the event that at any time, as a
result of an adjustment made pursuant to this Section 2, the holders of this
Warrant become entitled to purchase any shares of Common Stock or other
securities of the Company other than shares of Common Stock, thereafter the
number of such other shares or other securities so purchasable upon exercise of
this Warrant and the Warrant Price of such shares or other securities shall be
subject to adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to the shares contained
in this Section 2 and the provisions of this Section 2 and all other applicable
sections of this Warrant shall apply on like terms to any such other shares of
securities.
(g) Except as provided in paragraphs (a) through (f), no
adjustment for any dividends, or any distribution or sale of securities, shall
be made during the term of this Warrant or upon the exercise of this Warrant.
(h) In case of any capital reorganization, or any
reclassification of the shares of Common Stock (other than a reclassification
outlined by paragraph (a)(iii) above) of the Company, or in case of the
consolidation or merger of the Company with or into any other corporation or the
sale, lease, conveyance or other disposition of all or substantially all of the
properties and assets of the Company to any other corporation, the Company or
such successor or purchasing corporation, as the case may be, shall execute with
the holder of this Warrant an agreement to the effect that this Warrant shall,
after such capital reorganization reclassification, consolidation, merger or
sale, lease, conveyance or other disposition, be exercisable into the kind and
amount of shares of stock or other securities or property (including cash) to
which the holder of the number of shares of Common Stock deliverable
(immediately prior to the happening of such capital reorganization,
reclassification, consolidation, merger, sale, lease, conveyance or other
disposition) upon exercise of a Warrant would have been entitled upon the
happening of such event. The Company shall mail by first class mail, postage
prepaid, to the holder of this Warrant a notice of any event requiring such
agreement at least 30 days prior to the effective date of such event. Such
agreement shall provide for all appropriate adjustments, which shall be as
nearly equivalent as may be practicable to the adjustments provided for in this
Section 2. The provisions of this paragraph (h) shall also apply to successive
reorganizations, reclassifications, consolidations, mergers, sales, leases,
conveyances and other dispositions.
(i) Irrespective of any adjustments in the Warrant Price or
the number or kind of shares or other securities purchasable upon the exercise
of this Warrant, the Warrant theretofore or thereafter issued may continue to
express the same price and number and kind of shares of Common Stock as are
stated in this Warrant.
(j) The Company shall not be required to issue fractional
shares of Common Stock on the exercise of Warrants. If any fraction of a share
would, except for the provisions of this Section 2, be issuable on the exercise
of this Warrant (or specified portion thereof), the Company shall pay an amount
in cash equal to the current market price per share of Common Stock, multiplied
by such fraction. For the purpose of this Section 2, the current or closing
market price per share of Common Stock at any date shall be deemed to be in the
average of the daily closing prices for the 45 consecutive trading days,
commencing 60 days before the date of computation. The closing price for each
day shall be (I) if the shares of Common Stock are listed or admitted to trading
on a principal national securities exchange (presently the American Stock
Exchange) or the National Market System of NASDAQ, the last reported sales price
on the principal national securities exchange on which the shares of Common
Stock are listed or admitted to trading or on the National Market System of
NASDAQ, (ii) if the shares of Common Stock are not listed or admitted to trading
on any such exchange, the average of the highest bid and lowest asked prices, as
reported on the Automated Quotation System of the National Quotations Bureau,
Incorporated or an equivalent generally accepted reporting system, or (iii) if
the shares of Common Stock are not publicly traded, a price determined in good
faith by the Board of Directors of the Company.
3. REGISTRATION RIGHTS. The shares of Common Stock underlying this
Warrant shall be entitled to certain registration rights upon the terms, and
subject to the conditions, of the Registration Rights Agreement of even date
herewith between the Holder of this Warrant and the Company.
4. NO SHAREHOLDER RIGHTS. This Warrant shall not entitle the holder
hereof to any voting rights or other rights as a shareholder of the Company.
5. GENDER AND NUMBER. As used herein, the use of any of the masculine,
feminine, or neuter gender and the use of singular or plural numbers shall
include any or all of the other, wherever and whenever appropriate in the
context.
6. NOTICES. Except as otherwise provided herein, any notice pursuant to
this Warrant by the Company or any Holder of the Warrant shall be in writing and
shall be deemed to have been duly given when personally delivered or five days
after such notice is mailed or certified mail, return receipt requested, postage
prepaid (a) if to the Company, to 00000 Xxxxx Xxxxxx, Xxxxxxxx Xxxxx, Xxxxxxxxxx
00000, attention: Chairman of the Board, and (b) if to the Holder of this
Warrant, to such person at his address listed on the Company's books and
records, or to such other address as it may be changed from time to time on the
books of the Company by written notice. Each party hereto may from time to time
change the address to which notices to it are to be delivered or mailed
hereunder by notice in writing to the other party.
7. BENEFITS. Nothing in the Warrant shall be construed to give to any
person or corporation other than the Company and the holder of this Warrant any
legal or equitable right, remedy, or claim hereunder, but this Warrant shall be
for the sole and exclusive benefit of the Company and the holder of this
Warrant.
8. INVESTMENT. The Holder hereof covenants and agrees that this Warrant
has been taken for investment and for its own account and not with a view
towards resale or distribution within the meaning of the Securities Act of 1933,
as amended (the "Securities Act"). Furthermore, such Holder acknowledges that
the certificate(s) representing the shares of Common Stock issuable upon
exercise of this Warrant will bear an appropriate legend to this effect and that
such shares will be "restricted securities", as defined under Rule 144
promulgated under the Securities Act. The Holder of this Warrant, by acceptance
hereof, agrees to give written notice to the Company before exercising or
transferring this Warrant or any part hereof or transferring any Common Stock
issuable or issued upon the exercise hereof, of such Holder's intention to do
so, describing briefly the manner of any proposed transfer of this Warrant of
such Holder's Intention as to the disposition to be made of shares of Common
Stock issued upon the exercise hereof. Promptly upon receiving such written
notice, the Company shall present copies thereof to its counsel. If in the
opinion of such counsel the proposed transfer, or exercise and disposition of
this Warrant or any part hereof, or disposition of shares of Common Stock may be
effected without registration or qualification (under any Federal or State law)
of this Warrant or the shares of Common Stock issuable or issued on the exercise
hereof, the Company, as promptly as practicable, shall notify such Holder of
such opinion, whereupon such Holder shall be entitled to transfer this Warrant
or any part hereof, or to exercise this Warrant or any part hereof in accordance
with its terms and/or dispose of the shares received upon such exercise or to
dispose of shares of Common Stock received upon the previous exercise of this
Warrant, all in accordance with the terms of the notice delivered by such Holder
to the Company, provided that an appropriate legend may be endorsed on this
Warrant or the certificates for such shares respecting restrictions upon
transfer thereof necessary or advisable in the opinion of counsel to the Company
to prevent further transfers which would be in violation of Section 5 of the
Securities Act.
9. EXCHANGES. This Warrant is exchangeable, upon the surrender hereof
by the Holder hereof at the principal office of the Company, for new Warrants of
like tenor representing in the aggregate the right to subscribe for and purchase
the number of shares which may be subscribed for and purchased hereunder, each
of such new Warrants to represent the right to subscribe for and purchase such
number of shares as shall be designated by said Holder hereof at the time of
such surrender.
10. APPLICABLE LAW. This Warrant shall for all purposes be construed
and interpreted in accordance with the laws of the State of Delaware, without
regard to any conflict of law, rule or principle that would give effect to the
laws of another jurisdiction.
DATED as of November 13, 1996
DATAMETRICS CORPORATION
By: /s/ Xxxxxx X. Xxxxxx, Xx.
-------------------------------
Name: Xxxxxx X. Xxxxxx, Xx.
Title: President & Chief Operating
Officer
EXHIBIT A
EXERCISE FORM
(To be Executed by the Registered Holder
to Exercise the Rights to Purchase
Common Shares Evidenced by the Warrant)
DATAMETRICS CORPORATION
00000 Xxxxx Xxxxxx
Xxxxxxxx Xxxxx, Xxxxxxxxxx 00000
The undersigned hereby irrevocably subscribes for ___________ shares of
Common Stock pursuant to and in accordance with the terms and conditions of that
certain Warrant dated February _____, 1997, and herewith makes payment of
$____________ therefor, and requests that a certificate for such shares be
issued in the name of the undersigned and be delivered to the undersigned at the
address stated below. The undersigned further requests that if the number of
shares subscribed for herein shall not be all of the shares purchasable
hereunder, that a new Warrant of like tenor for the balance of the shares
purchasable hereunder be delivered to the undersigned.
Name:______________________________
Signed:_____________________________
Address:_____________________________
_____________________________________
Dated:________________
EXHIBIT B
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned _____________________________
hereof sells, assigns and transfers unto _________________________________ of
the _________________ Warrants represented by the within Warrant, together with
all rights, title and interest therein, and does hereby irrevocably constitute
and appoint the Company attorney to transfer such Warrant on the books of such
Company with full power of substitution in the premises.
Dated:_______________________
Name of Existing Warrant Holder:______________________________________________
Social Security or Federal ID Number:_____________________
Address:___________________________________________________________________
Signature:__________________________________________________________________
Name of New Warrant Holder:_________________________________________________
Social Security or Federal ID Number:_____________________
Address:___________________________________________________________________
Signature:__________________________________________________________________
