Document:

Exhibit
10.3

 

WARRANT

 

THIS WARRANT (THE “WARRANT”) IS ISSUED PURSUANT TO THE TERMS OF THE
PROVISIONS OF A WARRANT PURCHASE AGREEMENT (THE “AGREEMENT”) BETWEEN BIOJECT
MEDICAL TECHNOLOGIES INC. (THE “COMPANY”) AND THE INITIAL WARRANT HOLDER.  A COPY OF SUCH AGREEMENT IS ON FILE AT THE
OFFICE OF THE CORPORATE SECRETARY OF THE COMPANY.  THIS SECURITY WAS SOLD IN A PRIVATE
PLACEMENT, WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), AND MAY BE OFFERED OR SOLD ONLY IF REGISTERED UNDER THE
SECURITIES ACT OR IF AN EXEMPTION FROM REGISTRATION IS AVAILABLE.

 

 

	
  Company:

  	
  Bioject Medical Technologies, Inc., an
  Oregon corporation (BJCT: NASDAQ)

  
	
  Number of Shares:

  	
  725,000

  
	
  Class of Shares:

  	
  Common, no par value

  
	
  Exercise Price:

  	
  $1.42

  
	
  Issue Date:

  	
  December 15, 2004

  
	
  Expiration Date:

  	
  December 14, 2011

  

 

The term “Holder” shall initially refer to
Partners for Growth, L.P., a Delaware limited partnership, which is the initial
holder of this Warrant and shall further refer to any subsequent permitted
holder of this Warrant from time to time.

 

The Holder is subject to certain restrictions
as set forth in the Agreement.

 

The Company does hereby certify and agree
that, for the agreed sum of $7,250 and for other good and valuable
consideration, the Holder, or its permitted successors and assigns, hereby is
entitled to purchase from Bioject Medical Technologies, Inc. (the “Company”)
Seven Hundred Twenty-Five Thousand (725,000) duly authorized, validly issued,
fully paid and non-assessable shares of its Common Stock, no par value, upon
the terms and subject to the provisions of this Warrant. The shares of Common
Stock issuable upon exercise of this Warrant are referred to herein as the “Warrant
Stock,” and the Warrant and the Warrant Stock are sometimes together referred
to as the “Securities.”

 

Section 1.      Term, Price and Exercise of Warrant.

 

1.1    
Term of Warrant. This Warrant shall be exercisable for a period
of seven (7) years after the date hereof (hereinafter referred to as the “Expiration
Date”).

 

1.2    
Exercise Price.  The price
per share at which the Warrant Stock is issuable upon exercise of this Warrant
shall be One Dollar and Forty-Two Cents ($1.42), subject to adjustment from
time to time as set forth herein (the “Exercise Price”).

 

 

1.3    
Exercise of Warrant.

 

(a) 
This Warrant may be exercised or converted, in whole or in part, upon
surrender to the Company at its then principal offices in the United States of
this Warrant to be exercised, together with the form of election to exercise
attached hereto as Exhibit A duly completed and executed, and upon payment to
the Company of the Exercise Price for the number of shares of Warrant Stock in
respect of which this Warrant is then being exercised.

 

(b) 
Payment of the aggregate Exercise Price may be made (i) in cash or by
cashier’s or bank check or (ii) by converting this Warrant through a Cashless
Exercise (as defined herein).  Upon a “Cashless
Exercise” the Holder shall receive Warrant Stock on a net basis such that,
without the payment of any funds, the Holder shall surrender this Warrant in
exchange for the number of shares of Warrant Stock equal to “X” (as defined
below), computed using the following formula:

 

	
  X  
  =   

  	
    Y * (A-B)

  	
   

  
	
   

  	
    A

  

 
Where
 
X    =                    the number of shares of Warrant Stock to be issued to Holder.
Y    =                     the number of shares of Warrant Stock to be exercised under this Warrant
A    =                   the Fair Market Value of one share of Common Stock.
B    =                     the Exercise Price (as adjusted to the date of such calculations).
 
(c)  For purposes of this Warrant, the “Fair Market Value” of one share of Warrant Stock shall be (i) if the Company’s common stock (the “Common Stock”) is or becomes listed on a national stock exchange or the Nasdaq SmallCap Market, the product of (A) the highest closing sale price reported on such exchange or market for the 90-day period prior to the earlier of the day Holder delivers its Election of Exercise to the Company or the date of determination of Fair Market Value and (B) the number of shares of Common Stock into which a share of Warrant Stock is convertible at the time of such exercise, or (ii) if the Common Stock is traded over-the-counter, the product of (A) the highest closing bid price for the Common Stock over the 90-day period immediately prior to the earlier of the day Holder delivers its Election of Exercise to the Company or the date of determination of Fair Market Value and (B) the number of shares of Common Stock into which one share of Warrant Stock is convertible at the time of such exercise.  If the Common Stock is not traded as contemplated in clauses (i) or (ii), above, the Fair Market Value of the Company’s Warrant Stock shall be the price per share which the Company could obtain from a willing buyer for shares of Warrant Stock sold by the Company from its authorized but unissued shares, as the Board of Directors of the Company shall determine in its reasonable good faith judgment.  In the event that Holder elects to convert the Warrant Stock through Cashless Exercise in connection with a

 

 

transaction in which the Warrant Stock is converted into or exchanged for another security, Holder may effect a Cashless Exercise directly into such other security.  Notwithstanding the right of the Holder to effect a Cashless Exercise, the Company may require Holder to exercise this Warrant for cash if the Warrant Stock is registered under the Securities Act of 1933, may be traded by Holder without restriction under SEC rules and regulations and applicable law and such freely-tradable Common Stock issuable upon exercise of this Warrant is delivered within three (3) Business Days of Holder’s exercise.
 

(d) 
Subject to Section 2 hereof, upon surrender of this Warrant, and
the duly completed and executed form of election to exercise, and payment of the
Exercise Price or conversion of this Warrant through Cashless Exercise, the
Company shall issue and deliver within three (3) business days to the Holder or
such other person as the Holder may designate in writing a certificate or
certificates for the number of shares of Warrant Stock so purchased upon the
exercise or conversion of this Warrant. Such certificate or certificates shall
be deemed to have been issued and any person so designated to be named therein
shall be deemed to have become a holder of record of such Warrant Stock as of
the date of the surrender of this Warrant, and the duly completed and executed
form of election to exercise, and payment of the Exercise Price or conversion
of this Warrant through Cashless Exercise; provided, that if the date of
surrender of this Warrant and payment of the Exercise Price is not a business
day, the certificates for the Warrant Stock shall be issued as of the next
business day (whether before or after the Expiration Date), and, until such
date, the Company shall be under no duty to cause to be delivered any
certificate for such Warrant Stock or for shares of such other class of capital
stock.  If this Warrant is exercised or
converted in part, a new warrant of the same tenor and for the number of shares
of Warrant Stock not exercised or converted shall be executed by the Company.

 

1.4                                 Fractional
Interests. The Company shall not be required to issue fractions of shares
of Warrant Stock upon the exercise of this Warrant.  If any fraction of a share of Common Stock
would be issuable upon the exercise of this Warrant (or any portion thereof),
the Company shall purchase such fraction for an amount in cash equal to the
same fraction of the last reported sale price of the Common Stock on the NASDAQ
National Market System or any other national securities exchange or market on
which the Common Stock is then listed or traded.

 

1.5                                 Automatic
Conversion upon Expiration.  In the
event that, upon the Expiration Date, the fair market value of one share of
Common Stock (or other security issuable upon the exercise hereof) as
determined in accordance with Section 1.3 above is greater than the
Exercise Price in effect on such date, then this Warrant shall automatically be
deemed on and as of such date to be converted pursuant to Section 1.2
above as to all Warrant Stock (or such other securities) for which it shall not
previously have been exercised or converted, and the Company shall promptly
deliver a certificate representing the Warrant Stock (or such other securities)
issued upon such conversion to the Holder.

 

 

Section 2.                                          Exchange
and Transfer of Warrant.

 

(a) 
This Warrant may be transferred, in whole or in part, without
restriction, subject to (i) the Holder’s delivery of an opinion of counsel in
customary form that such transfer is in compliance with applicable securities
laws and (ii) the transferee holder of the new Warrant assumes in writing the
obligations of the Holder set forth in the Agreement.  A transfer may be registered with the Company
by submission to it of this Warrant, together with the annexed Assignment Form
attached hereto as Exhibit B duly completed and executed. After the Company’s
receipt of this Warrant and the Assignment Form so completed and executed, the
Company will issue and deliver to the transferee a new warrant (representing
the portion of this Warrant so transferred) at the same Exercise Price per
share and otherwise having the same terms and provisions as this Warrant, which
the Company will register in the new holder’s name.  In the event of a partial transfer of this
Warrant, the Company shall concurrently issue and deliver to the transferring
holder a new warrant that entitles the transferring holder to purchase the
balance of this Warrant not so transferred and that otherwise is upon the same
terms and conditions as this Warrant. 
Upon the due delivery of this Warrant for transfer, the transferee
holder shall be deemed for all purposes to have become the holder of the new
warrant issued for the portion of this Warrant so transferred, effective
immediately prior to the close of business on the date of such delivery,
irrespective of the date of actual delivery of the new warrant representing the
portion of this Warrant so transferred.

 

(b)  In
the event of the loss, theft or destruction of this Warrant, the Company shall
execute and deliver an identical new warrant to the Holder in substitution
therefor upon the Company’s receipt of (i) evidence reasonably satisfactory to
the Company of such event and (ii) if requested by the Company, an indemnity
agreement reasonably satisfactory in form and substance to the Company.  In the event of the mutilation of or other
damage to the Warrant, the Company shall execute and deliver an identical new
warrant to the Holder in substitution therefor upon the Company’s receipt of
the mutilated or damaged warrant.

 

(c) 
The Company shall pay all costs and expenses incurred in connection with
the exercise, exchange, transfer or replacement of this Warrant, including,
without limitation, the costs of preparation, execution and delivery of a new
warrant and of share certificates representing all Warrant Stock; provided,
that the Holder shall pay all stamp and other transfer taxes payable in
connection with the transfer or replacement of this Warrant.

 

Section 3.                                          Certain
Covenants.

 

(a) 
The Company shall at all times reserve for issuance and keep available
out of its authorized and unissued Common Stock, solely for the purpose of
providing for the exercise of this Warrant, such number of shares of Common
Stock as shall from time to time be sufficient therefor.

 

(b) 
The Company will not, by amendment of its Articles of Incorporation or
Bylaws or through reorganization, consolidation, merger, amalgamation, sale of
assets or

 

 

otherwise, avoid or seek to avoid the observance or performance of any
of the terms of this Warrant.  Without
limiting the foregoing, the Company (i) will not increase the par value of any
shares receivable upon the exercise of this Warrant above the amount payable
therefor upon such exercise and (ii) will take all such action as may be
necessary or appropriate in order that the Company may validly and legally
issue fully paid and nonassessable shares upon the exercise of this Warrant.

 

Section 4.                                          Adjustments
to Exercise Price and Number of Shares of Warrant Stock.

 

4.1  Adjustments. In order to prevent dilution of the rights granted hereunder, the Exercise Price shall be subject to adjustment from time to time in accordance with this Section 4. Upon each adjustment of the Exercise Price pursuant to this Section 4, the Holder shall thereafter be entitled to acquire upon exercise, at the Exercise Price resulting from such adjustment, the number of shares of Common Stock of the Company obtainable by multiplying the Exercise Price in effect immediately prior to such adjustment by the number of shares of Common Stock acquirable immediately prior to such adjustment and dividing the product thereof by the new Exercise Price resulting from such adjustment.
 
4.2  Subdivisions, Combinations and Share Dividends. If the Company shall at any time subdivide by split-up or otherwise, its outstanding Common Stock into a greater number of shares, or issue additional Common Stock as a dividend, bonus issue or otherwise with respect to any Common Stock, the Exercise Price in effect immediately prior to such subdivision or share dividend or bonus issue shall be proportionately reduced. Conversely, in case the outstanding Common Stock of the Company shall be combined into a smaller number of shares, the Exercise Price in effect immediately prior to such combination shall be proportionately increased.
 
4.3.  Reorganization, Reclassification, Consolidation, Merger or Sale of Assets. If any capital reorganization or reclassification of the Common Stock, or consolidation, amalgamation or merger of the Company with another corporation, or the sale of all or substantially all of its assets to another corporation shall be effected in such a way that holders of Common Stock shall be entitled to receive shares, securities, cash or other property with respect to or in exchange for Common Stock, then, as a condition of such reorganization, reclassification, consolidation, amalgamation, merger or sale, lawful and adequate provision shall be made whereby the Holder shall have the right to acquire and receive upon exercise of this Warrant (or at the option of the Holder, shall have the right to receive a new and equivalent Warrant for) such shares, securities, cash or other property issuable or payable (as part of the reorganization, reclassification, consolidation, amalgamation, merger or sale) with respect to or in exchange for such number of outstanding shares of Common Stock as would have been received upon exercise of this Warrant at the Exercise Price then in effect. The Company will not effect any such consolidation, amalgamation, merger or sale unless, prior to the consummation thereof, the successor corporation (if other than the Company) resulting from such consolidation or merger or the corporation purchasing such assets shall assume by written instrument

 

 

the obligation to deliver such shares, securities or assets that the Holder may be entitled to purchase in accordance with the foregoing provisions.  If a purchase, tender or exchange offer is made to and accepted by the holders of more than 50% of the outstanding Common Stock of the Company, the Company shall not effect any consolidation, amalgamation, merger or sale with the person having made such offer or with any Affiliate of such person, unless prior to the consummation of such consolidation, merger or sale the Holder shall have been given a reasonable opportunity to then elect to receive upon the exercise of this Warrant either the shares, securities or assets then issuable with respect to the Common Stock of the Company or the shares, securities or assets, or the equivalent, issued to previous holders of the Common Stock in accordance with such offer. For purposes hereof the term “Affiliate” with respect to any given person shall mean any person controlling, controlled by or under common control with the given person.
 
4.4.  Notices of Record Date, Etc.  In the event that:
 
(1) declare or propose to declare any dividend upon its capital stock, whether payable in cash, property, stock or other securities and whether or not a regular cash dividend, or
 
(2)  offer for sale any additional shares of any class or series of the Company’s capital stock or securities exchangeable for or convertible into such capital stock, or
 
(3)                                  effect or approve any reclassification, exchange, substitution or recapitalization of the capital stock of the Company, including any subdivision or combination of its outstanding capital stock, or consolidation or merger of the Company with, or sale of all or substantially all of its assets to, another corporation,  or to liquidate, dissolve or wind up (including an assignment for the benefit of creditors), or
 
(4)  offer holders of registration rights the opportunity to participate in any public offering of the Company’s securities,
 
then, in connection with such event, the Company shall give to Holder:
 
(i) at least ten (10) days prior written notice of the date on which the books of the Company shall close or a record shall be taken for such a dividend or offer in respect of the matters referred to in (1) or (2) above, or for determining rights to vote in respect of the matters referred to in (3) above; and
 
(ii) in the case of the matters referred to in (3) above, at least ten (10) days prior written notice of the date when the same shall take place. Such notice in accordance with the foregoing clause (i) shall also specify, in the case of any such dividend, the date on which the holders of capital stock shall be entitled thereto and the terms of such dividend, and such notice in accordance with this clause (ii) shall also specify the date on which the holders of capital stock shall be entitled to exchange their capital stock for securities or other property deliverable upon such reorganization, reclassification, exchange,

 

 

substitution, consolidation, merger or sale, as the case may be, and the terms of such exchange. Each such written notice shall be given by first class mail, postage prepaid, addressed to the holder of this Warrant at the address of Holder; and
 
(iii)  in the case of the matter referred to in (4) above, the same notice as is given or required to be given to the holders of such registration rights.
 
4.5. Adjustment by Board of Directors. If any event occurs as to which, in the opinion of the Board of Directors of the Company, the provisions of this Section 4 are not strictly applicable or if strictly applicable would not fairly protect the rights of the Holder in accordance with the essential intent and principles of such provisions, then the Board of Directors shall make an adjustment in the application of such provisions, in accordance with such essential intent and principles, so as to protect such rights, but in no event shall any adjustment have the effect of increasing the Exercise Price as otherwise determined pursuant to any of the provisions of this Section 4, except in the case of a combination of shares of a type contemplated in Section 4.2 and then in no event to an amount larger than the Exercise Price as adjusted pursuant to Section 4.2.
 
4.6. Officers’ Statement as to Adjustments. Whenever the Exercise Price and/or number of shares of Warrant Stock subject to the Warrant is required to be adjusted as provided in Section 4, the Company shall forthwith file at each office designated for the exercise of this Warrant a statement, signed by the Chief Executive Officer, Chief Financial Officer or any Managing Director of the Company, showing in reasonable detail the facts requiring such adjustment, the Exercise Price and number of issuable shares that will be effective after such adjustment; provided, however, such statement shall not be required to the extent the information requested in this Section 4.6 is available through the Company’s reports filed with the Securities and Exchange Commission. If the information described in this Section 4.6 is readily available through the Company’s reports filed with the Securities and Exchange Commission, the Company shall not be required to provide a separate notice of adjustment to the Holder; provided, however, if such information is not readily available through the Company’s reports filed with the Securities Exchange Commission and made public, the Company shall cause a notice setting forth any such adjustments to be sent by mail, first class, postage prepaid, to the record Holder of this Warrant at its address appearing herein.  If such notice relates to an adjustment resulting from an event referred to in Section 4.3, such notice shall be included as part of the notice required to be mailed or published under the provisions of Section 4.3.
 

4.7  Issue
of Securities other than Common Stock. 
In the event that at any time, as a result of any adjustment made
pursuant to Section 4, the Holder thereafter shall become entitled to
receive any shares of the Company, other than Common Stock, thereafter the
number of such other shares so receivable upon exercise of this Warrant 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 Common Stock
contained in Section 4.

 

 

Section 5.                                          Rights
and Obligations of the Warrant Holder.

 

This Warrant shall not entitle the Holder to
any rights of a holder of Common Stock in the Company.  The Holder shall have the specific “piggyback”
registration rights set forth in Exhibit C attached hereto and made a part
hereof.  Capitalized terms not otherwise
defined in Exhibit C shall have the meanings set forth herein.

 

Section 6.                                          Restrictive
Stock Legend.

 

This Warrant and the Warrant Stock have not
been registered under any securities laws. 
Accordingly, any share certificates issued pursuant to the exercise of
this Warrant shall (until receipt of an opinion of counsel in customary form
that such legend is no longer necessary) bear the following legend:

 

THIS WARRANT AND THE WARRANT STOCK ISSUABLE
UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
(THE “ACT”), AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR
IN CONNECTION WITH, THE SALE OF DISTRIBUTION THEREOF. NO SUCH SALE OR
DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT
RELATED THERETO OR AN OPINION OF COUNSEL IN CUSTOMARY FORM THAT SUCH
REGISTRATION IS NOT REQUIRED UNDER THE ACT.

 

Section 7.                                          Notices.

 

Any notice or other communication required or
permitted to be given here shall be in writing and shall be effective (a) upon
hand delivery or delivery by e-mail or facsimile at the address or number
designated below (if delivered on a business day during normal business hours
where such notice is to be received) or the first business day following such
delivery (if delivered other than on a business day during normal business
hours where such notice is to be received), or (b) on the third business day
following the date of mailing by express courier service, fully prepaid,
addressed to such address, or upon actual receipt of such mailing, whichever
shall first occur. The addresses for such communication shall be:

 

if to Holder, at
 
Partners for Growth, L.P.
560 Mission Street, Third Floor
San Francisco, California 94105
Attention:  Lorraine Nield
Fax:  (415) 315-7959
lorraine@pfgrowth.com

 

 

with a copy to
 
Benjamin Greenspan, Esq.
620 Laguna Road
Mill Valley, CA 94941
Fax: (415) 358-4780
Email: bg2@greenspan.org
 
or
 
if to the Company, at
 

Bioject Medical Technologies Inc.

Attn:  John Gandolfo

Bedminster Professional Center

211 Somerville Road (Route 202 North)

Bedminster, New Jersey 07921

Phone: 908.470.2800

Fax: 908.470.1728

Email:
jgandolfo@bioject.com

 

with a copy to:
 

Stoel Rives, LLP

Attn: 
Todd A. Bauman

900 SW 5th Avenue

Suite 2600

Portland, OR 97204

(503) 294-9812 Direct

(503) 220-2480 Fax

tabauman@stoel.com

 

Each party hereto may from time to time change its address for notices
under this Section 7 by giving at least 10 calendar days’ notice of such
changes address to the other party hereto.

 

Section 8.                                          Amendments
and Waivers.

 

                                                This
Warrant and any term hereof may be changed, waived, discharged or terminated
only by an instrument in writing signed by the party against which enforcement
of such change, waiver, discharge or termination is sought.

 

 

Section 9.                                          Applicable
Law; Severability.

 

This Warrant shall be governed by and
construed and enforced in accordance with the laws of the State of Oregon.  If any one or more of the provisions
contained in this Warrant, or any application of any provision thereof, shall
be invalid, illegal, or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein and all other
applications of any provision thereof shall not in any way be affected or
impaired thereby.

 

Section 10.                                   Construction.

 

The terms of the Warrant Purchase Agreement
to which this Warrant is attached as Exhibit 1 are incorporated by reference
herein. Terms used but not defined herein have the meaning set forth in the
Warrant Purchase Agreement.

 

IN WITNESS WHEREOF, the Company has caused
this Warrant to be duly executed on the day and year first above written.

 

	
  COMPANY:

  
	
   

  
	
  Bioject Medical Technologies Inc.

  
	
   

  
	
   

  
	
  By:

  	
  /s/ John P. Gandolfo

  	
   

  
	
   

  	
   

  
	
  Name:

  	
  John P. Gandolfo

  	
   

  
	
   

  	
   

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  
	
   

  
	
  ACKNOWLEDGED AND AGREED:

  
	
   

  
	
  HOLDER:

  
	
   

  
	
  Partners for Growth, L.P.

  
	
   

  
	
   

  
	
  By:

  	
  /s/ Lorraine Nield

  	
  , Manager of

  
	
   

  	
  Partners for Growth, LLC,

  Its General Partner

  
									

 

 

Signature
Page Bioject – PFG Warrant

 

 

Exhibit A

 

To:                              Bioject Medical Technologies Inc.
 

ELECTION TO EXERCISE

 

1.                                       The undersigned hereby exercises its right to subscribe for and purchase                                    fully paid, validly issued and nonassessable Shares covered by the attached Warrant and tenders payment herewith in the amount of $                             in accordance with the terms thereof.
 

1.                                       The
undersigned hereby elects to convert the attached Warrant into fully paid,
validly issued and nonassessable Shares by Cashless Exercise in the manner
specified in Section 1.3 of the attached Warrant. This conversion is
exercised with respect to                       
of shares.

 

[Strike the paragraph above that does not apply.]

 

, and requests that certificates for such shares be issued in the name of, and delivered to:
 

	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
         [Holder]

  
	
   

  
	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
									

 

 

Exhibit B

 

ASSIGNMENT FORM

 

To:                              Bioject
Medical Technologies Inc.

 

The undersigned hereby assigns and transfers
this Warrant to

 

	
   

  
	
  (Insert assignee’s social security or tax
  identification number)

  
	
   

  
	
   

  
	
  (Print or type assignee’s name, address and
  postal code)

  
	
   

  
	
   

  
	
   

  
	
   

  

 

and irrevocably appoints                                                                               
to transfer this Warrant on the books of the Company.

 

	
  Date:

  	
   

  	
    Partners For Growth, L.P.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
  , Manager of

  
	
   

  	
  Partners for Growth, LLC, Its General
  Partner

  
								

 

 

EXHIBIT C

 

PIGGYBACK REGISTRATION RIGHTS

 

1. PIGGYBACK REGISTRATION RIGHTS.

 

1.1    
Piggyback Rights. If (but without any obligation to do so) the
Company proposes to register any of its equity securities under the United
States Securities Act of 1933 (the “Act”) in connection with the public
offering of such shares (other than (i) a registration relating solely to the
sale of securities to participants in a Company equity option or stock
incentive or share rights or share purchase plan, (ii) a registration relating
to a corporate reorganization or other transaction under Rule 145 of the Act,
or (iii) a registration relating to the offer and sale of debt securities, (iv)
a registration on any registration form that does not permit secondary sales,
or (v) a registration on any form that does not include substantially the same
information as would be required to be included in a registration statement
covering the sale of the Warrant Stock, the Company shall, at such time,
promptly give the Holder written notice of such registration. Upon the written
request of the Holder given within ten (10) business days after mailing of such
notice by the Company, the Company shall, subject to the provisions of Section 1.4
of this Exhibit C, use all commercially reasonable efforts to cause a
registration statement to become effective, which includes all of the Warrant
Stock that the Holder requests to be registered by such notice and for which
the Holder (or its individual members) is then the shareholder of record (or
would be the shareholder of record upon the exercise of its Warrant).  Notwithstanding anything in this Section 1.1
to the contrary, Holder agrees to register all the Warrant Stock under the Act
on the registration statement the Company intends to file to register the
shares of Common Stock underlying the shares of Series D Preferred Stock
and warrants to purchase common stock issued by the Company on November 15,
2004.

 

1.2    Right
to Terminate Registration. The Company shall have the right to terminate or
withdraw any registration initiated by it under this Section 1 prior to
the effectiveness of such registration whether or not the Holder has elected to
include securities in such registration.

 

1.3    
Expenses of Registration. All expenses other than underwriting
discounts and commissions incurred in connection with registrations, filings or
qualifications pursuant to this Section, including without limitation all
registration, filing and qualification fees (including Blue Sky fees), printers’
and accounting fees, and fees and disbursements of counsel for the Company and
the reasonable fees and disbursements for one counsel for the Holder shall be
borne by the Company (which shall not exceed $2,000). Any fees or disbursements
of counsel for the Holder (other than the single counsel referenced above)
shall be borne by the Holder.

 

1.4    
Underwriting Requirements. In connection with any offering
involving an underwriting of Common Stock of the Company, the Company shall not
be required under this Section to include any of the Warrant Stock in such
underwriting unless the Holder accepts the terms of the underwriting as agreed
upon between the Company and the underwriters selected by it (or by other
persons entitled to select the underwriters) and enters into an underwriting
agreement in customary form with an underwriter or underwriters selected by the
Company. If the total amount of securities, including Warrant Stock, requested
by shareholders or other securities holders to be included in such offering
exceeds the amount of securities sold other than by the Company that the
underwriters determine in their sole discretion is compatible with the

 

 

success of the offering, then the Company shall be required to include
in the offering only that number of such securities, including Warrant Stock,
that the underwriters determine in their sole discretion will not jeopardize
the success of the offering (the securities so included to be apportioned pro
rata among the selling shareholders, including Holder, according to the total
amount of securities entitled to be included therein owned by each selling
shareholder or in such other proportions as may be mutually agreed to by such
selling shareholders).

 

1.5    Information
from the Holder. It shall be a condition precedent to the obligations of
the Company to take any action pursuant to this Section 1 with respect to
the Warrant Stock that the Holder shall furnish to the Company such information
regarding itself and its individual members, the Warrant Stock held by Holder
or its members, and the intended method of disposition of such securities as
shall be reasonably required to effect the registration of the Warrant Stock.

 

1.6      
No Delay of Registration. The Holder shall not have any right to
obtain or seek an injunction restraining or otherwise delaying any such
registration as the result of any controversy that might arise with respect to
the interpretation or implementation of this Section 1.

 

2.  
INDEMNIFICATION

 

In the event any shares of Warrant Stock are
included in a registration statement under Section 1 of this Exhibit C:

 

2.1      
The Company Indemnity. To the extent permitted by law, the
Company will indemnify, defend and hold harmless the Holder, its partners or
officers, directors, shareholders, legal counsel and accountants for the
Holder, any underwriter (as defined in the Act) for the Holder and each person,
if any, who controls the Holder or underwriter, within the meaning of the
Securities Act or the Securities Exchange Act of 1934, as amended (the “Exchange
Act”) (each an “Indemnified Person”), against any losses, claims, damages or
liabilities (joint or several) to which they may become subject under the
Securities Act, the Exchange Act or any state securities laws, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon any of the following statements, omissions or
violations (collectively a “Violation”): (i) any untrue statement or alleged
untrue statement of a material fact contained in such registration statement,
including any preliminary prospectus or final prospectus contained therein or any
amendments or supplements thereto, (ii) the omission or alleged omission to
state therein a material fact required to be stated therein, or necessary to
make the statements therein not misleading, or (iii) any violation or alleged
violation by the Company of the Securities Act, the Exchange Act, any state
securities laws or any rule or regulation promulgated under the Securities Act,
the Exchange Act or any state securities laws in connection with such
registration; and the Company will reimburse each Indemnified Person for any
legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred; provided however that the indemnity agreement contained
in this Section 2.1 shall not apply to amounts paid in settlement of any
such loss, claim, damage, liability or action if such settlement is effected
without the consent of the Company (which consent shall not be unreasonably
withheld), nor shall the Company be liable in any such case for any such loss,
claim, damage, liability or action to the extent that it arises out of or is
based upon a Violation that occurs in reliance upon and in conformity with
written information furnished expressly for use in

 

 

connection with such registration by any Indemnified Person; provided
further, however, that the foregoing indemnity agreement with respect to any
preliminary prospectus shall not inure to the benefit of any Indemnified Person
from whom the person asserting any such losses, claims, damages or liabilities
purchased Warrant Stock in the offering, if a copy of the prospectus (as then
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto) was not sent or given by or on behalf of such Indemnified
Person to such person, if required by law so to have been delivered, at or
prior to the written confirmation of the sale of the shares to such person, and
if the prospectus (as so amended or supplemented) would have cured the defect
giving rise to such loss, claim, damage or liability.

 

2.2      
Holder Indemnity. To the extent permitted by law, the Holder will
defend and hold harmless the Company, each of its directors, each of its
officers, each of its partners, each person, if any, who controls the Company
within the meaning of the Securities Act, legal counsel and accountants for the
Company, any underwriter, any other shareholder selling securities in such
registration statement and any controlling person of any such underwriter or
other shareholder, against any losses, claims, damages or liabilities (joint or
several) to which any of the foregoing persons may become subject, under the
Securities Act, the Exchange Act or any state securities laws, insofar as such
losses, claims, damages or liabilities (or actions in respect thereto) arise
out of or are based upon any Violation (but excluding clause (iii) of the
definition thereof), in each case to the extent (and only to the extent) that
such Violation occurs in reliance upon and in conformity with written
information furnished by the Holder expressly for use in connection with such
registration; and the Holder will reimburse any person intended to be
indemnified pursuant to this Section 2.2 for any legal or other expenses
reasonably incurred by such person in connection with investigating or
defending any such loss, claim, damage, liability or action; provided however
that the indemnity agreement contained in this Section 2.2 shall not apply
to amounts paid in settlement of any such loss, claim, damage, liability or
action if such settlement is effected without the consent of the Holder (which
consent shall not be unreasonably withheld).

 

2.3      
Prompt Notice Required. Promptly after receipt by an indemnified
party under this Section 2 of actual knowledge of the commencement of any
action (including any governmental action), such indemnified party will, if a
claim in respect thereof is to be made against any indemnifying party under
this Section 2, deliver to the indemnifying party a written notice of the
commencement thereof and the indemnifying party shall have the right to
participate in, and, to the extent the indemnifying party so desires,  jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided however that an indemnified party
(together with all other indemnified parties that may be represented without
conflict by one counsel) shall have the right to retain one separate counsel,
with the fees and expenses to be paid by the indemnifying party, if
representation of such indemnified party by the counsel retained by the
indemnifying party would be inappropriate due to actual or potential differing
interests between such indemnified party and any other party represented by
such counsel in such proceeding.  The
failure to deliver written notice to the indemnifying party within a reasonable
time of the commencement of any such action, if prejudicial to its ability to
defend such action, shall relieve such indemnifying party of any liability to
the indemnified party under this Section 2 to the extent of such
prejudice, but the omission to so deliver written notice to the indemnifying
party will not relieve it of any liability that it may have to any indemnified
party otherwise than under this Section 2.3.

 

 

2.4      
Alternative Relief. If the indemnification provided for in this Section 2
is held by a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any loss, liability, claim, damage or expense
referred to herein, then the indemnifying party, in lieu of indemnifying such
indemnified party hereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such loss, liability, claim, damage or
expense in such proportion as is appropriate to reflect the relative fault of
and the relative benefits received by the indemnifying party on the one hand
and of the indemnified party on the other in connection with the statements or
omissions that resulted in such loss, liability, claim, damage or expense, as
well as any other relevant equitable considerations, provided that no person
guilty of fraud shall be entitled to contribution. The relative fault of the
indemnifying party and of the indemnified party shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission to state a material fact relates
to information supplied by the indemnifying party or by the indemnified party
and the parties’ relative intent, knowledge, access to information, and
opportunity to correct or prevent such statement or omission.  The relative benefits received by the
indemnifying party and the indemnified party shall be determined by reference
to the net proceeds and underwriting discounts and commissions from the
offering received by each such party.

 

2.5      
Underwriting Agreement. Notwithstanding the foregoing, to the
extent that the provisions on indemnification and contribution contained in the
underwriting agreement entered into in connection with the underwritten public
offering are in conflict with the foregoing provisions of this Section 2,
the provisions in the underwriting agreement shall control.

 

2.6      
Survival. The obligations of the Company and the Holder under
this Section 2 shall survive the completion of any offering of the Warrant
Stock in a registration statement under Section 1 of this Exhibit C.

 

3.  
ASSIGNMENT

 

The rights to cause the Company to register
Warrant Stock pursuant to Section 1 of this Exhibit C may be assigned (but
only with all related obligations) by Holder to a transferee or assignee of
such securities provided; (a) the Company is, within a reasonable time after
such transfer, furnished with written notice of the name and address of such
transferee or assignee and the securities with respect to which such
registration rights are being assigned and (b) such transferee or assignee
agrees in writing to be bound by and subject to the terms and conditions of the
Agreement.

 

4.  
TERMINATION OF REGISTRATION RIGHTS

 

The Holder shall not be entitled to exercise
any right provided for in Section 1 of this Exhibit C after such time at
which all Warrant Stock of the relevant holder can be sold in any three (3)
month period without registration in compliance with Rule 144 of the Act.EXHIBIT 10.11

 

Form of

John Deere Nonqualified Stock Option Grant

[Date]

 

 

 

[Name]

[Title]

Unit [        ]
- Department [        ]

 

Number of shares:

Grant Date:

Strike Price: $

 

The number of shares was
based on your annualized salary on [Date] multiplied by the market percent for
your grade and divided by a governor price of [$        ]. 
As communicated in Total Rewards Strategy rollout, the intent of the
governor price is to insure the shares granted will not exceed the shares
authorized by the shareholders.  The
future value of your grant will depend on the stock price on the date of
exercise exceeding the strike price established on the grant date.

 

This grant will vest over
the next three years, with 34% of the shares becoming exercisable in [Date]],
33% in [Date], and 33% in [Date].

 

You will be notified via
email in [Date] when the details regarding your stock option can be viewed on
the UBS Financial Services website.

 

 

Form
of

John
Deere Stock Option Grant

Terms
and Conditions

Granted
[Date]

(Nonqualified)

 

Vesting

This stock option will
become exercisable over a three-year period with 34% becoming exercisable one
year after the grant date, and 33% becoming exercisable on each of the second
and third years after the grant date. Vesting is accelerated upon retirement or
disability (each as defined under the John Deere Omnibus Equity and Incentive
Plan (Plan)) allowing you to exercise this option six months after the grant
date. If you die while actively employed, the entire option amount will be exercisable
immediately by your beneficiaries or heirs.

 

Expiration

This option will expire
ten years after the grant date. If you retire or
become disabled (as defined under the Plan), you or your heirs can exercise
this stock option within five years of separation or ten years from date of
grant, whichever comes first. If you die after retirement, the exercise period
may be extended to one year from date of death. If you die while
actively employed, your beneficiaries or heirs can exercise this stock option
within one year after the date of death or ten years from the date of grant,
whichever comes first. Options will be cancelled upon date of termination of
employment for reasons other than death, disability or retirement. Regardless
of the circumstance, all unexercised options will expire ten years from the
date of grant.

 

Calculation

The
option price of your grant is the average of high and low market prices at
which Deere & Company stock traded on the date of grant.

 

Expenses

Commissions,
fees, and other expenses connected with the exercise and sale of this option
grant are payable by you as part of the option price. No commissions or fees
are charged if you purchase and hold the shares.

 

Procedures

Stock options are
currently exercised through UBS Financial Services (Formerly UBS PaineWebber). Information regarding the exercise process is
available via the Internet at [web address] or by calling [phone
nember]. When calling from outside the U.S. and Canada, use the AT&T Direct
service access number before dialing the above number so the call will be toll
free. The toll number is [phone number].

 

NOTE: If this is your first stock option grant, information
about accessing your options via telephone or Internet will be mailed to your
home address, as shown in the Company’s personnel records.

 

Plan Information

This
option was granted under and is subject to the terms of the Plan, for which a
prospectus is available at [web address].
Any inconsistencies between this letter and the Plan shall be resolved in accordance
with the terms of the Plan. A paper copy of the prospectus is
also available upon request from the Deere & Company Compensation
Department, One John Deere Place, Moline, Illinois, 61265-8098 or by calling
(309) 765-4770. The latest Deere & Company
Annual Report and Proxy Statement are available electronically at
http://www.deere.com/stock or in hard copy upon request from the Deere &
Company Stockholder Relations Department.

 

Beneficiary
Form

If you have not already done so, please complete a Beneficiary
Designation Form and return it to Deere Direct. Your designation will remain in effect until changed
by you and will apply to this and all future grants under the Plan. Forms are
available at the UBS Financial Services Internet site referenced above.

 

Agreement

You
will be considered to have agreed to the terms and conditions of this grant,
including the non-compete and consulting obligations described in Section 8.2
of the Plan, if you have not notified Deere & Company of any issues or
problems within thirty days of the date of this notification.

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