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EXHIBIT 4.2    
    

 
 

AMENDMENT NO. 3
  
  TO
  
  RIGHTS AGREEMENT    
    

        This Amendment No. 3 to Rights Agreement (this "Amendment") is dated as of December 8, 2003 by and between
FIBERSTARS, INC., a California corporation (the "Company"), and MELLON INVESTOR SERVICES LLC, a New Jersey limited liability company, as Rights Agent (the
"Rights Agent"), with reference to the following: 

        A.    The
Company and the Rights Agent entered into that certain Rights Agreement dated as of September 20, 2001 (as amended from time to time, the
"Agreement") in order to implement a shareholder rights plan as more fully described therein. The Company and the Rights Agent entered into that certain Amendment
No. 1 to the Agreement dated as of March 26, 2002 (the "First Amendment") in order to clarify the shareholder rights as more fully described in the
Agreement. 

        B.    The
Company and the Rights Agent entered into that certain Amendment No. 2 to the Agreement as of June 17, 2003 (the "Second
Amendment") to amend the Agreement in certain respects in order to permit Trigran Investments LP and Advanced Lighting Technologies, Inc. the opportunity to purchase certain
additional shares of Common Stock of the Company without triggering the occurrence of a Distribution Date (as defined in the Agreement). 

        C.    Shareholder
Advanced Lighting Technologies, Inc. ("ADLT") is a debtor-in-possession under chapter 11 of the
Bankruptcy Code in the matter fashioned In re VENTURE LIGHTING INTERNATIONAL, et. al., Debtors, Case No. 03-0525, pending in the
United States Bankruptcy Court, Northern District of Illinois, Eastern Division (the "Bankruptcy Proceeding"). ADLT, together with others, is scheduled to appear in the
Bankruptcy Proceeding on or about December 8, 2003 and move the court for judicial confirmation of a proposed Chapter 11 Plan of Reorganization (as amended through its Fourth Amendment, the
"Plan"). In substance the Plan provides in relevant part that, if it is approved by, among others, the requisite number of ADLT common stock holders as of the bankruptcy
petition date (the "Class 7 Interests"), Beneficial Ownership (as defined by the Agreement) of the Fiberstars Common Stock held by ADLT would transfer as of, and
subject to, the Plan's Effective Date (as defined by the Plan) to a trust (the "Trust") for the benefit of the Class 7 Interests. 

        D.    The
Company hereby desires to amend the Agreement to allow such a transfer of Beneficial Ownership by ADLT to the Trust, and/or its trustee, as applicable, without
triggering the occurrence of a Distribution Date (as defined by the Agreement). 

        E.    Under
the Agreement, the Company and the Rights Agent may amend the Agreement, at any time prior to a Distribution Date, which has yet to occur. 

        NOW,
THEREFORE, pursuant to Section 27 of the Agreement, the Company and the Rights Agent hereby amend, effective upon the date hereof, the following: 

        The
definition of the term "Acquiring Person" set forth in Section 1(a) of the Agreement such that Section 1(a)(ii) of the Agreement shall be, and hereby is,
restated to read in its entirety as follows: 

	
"(ii)
	the
term Acquiring Person shall not mean: 

        (A)  the
Company; 

        (B)  any
Subsidiary (as such term is hereinafter defined) of the Company; 

        (C)  any
employee benefit plan of the Company or any of its Subsidiaries; 

        (D)  any
entity holding securities of the Company organized, appointed or established by the Company or any of its Subsidiaries for or pursuant to the terms of any such plan; 

 

        (E)  any
underwriter acting in good faith in a firm commitment underwriting of an offering of the Company's securities pursuant to arrangements with the Company that have
been approved by the Board (however, the exception provided by this clause (E) shall no longer be
available in the event that any such underwriter is otherwise an Acquiring Person on or after the date which is forty (40) days after the date of initial acquisition of the Company's securities
by such underwriter in connection with such offering); 

        (F)  Advanced
Lighting Technologies, Inc. (referred to collectively hereinafter with its (i) Affiliates, (ii) Associates and (iii) any trust
(including any trustee of such trust) established to hold shares of Common Stock pursuant to a confirmed and effective plan of reorganization of ADLT under chapter 11 of the Bankruptcy Code in the
matter fashioned In re VENTURE LIGHTING INTERNATIONAL, et. al., Debtors, Case No. 03-0525, United States Bankruptcy Court, Northern
District of Illinois, Eastern Division, as "ADLT"), so long as ADLT is not the Beneficial Owner of a percentage of the outstanding shares of Common Stock that is greater
(by more than one percent (1%) of the outstanding shares of Common Stock) than the percentage of the outstanding shares of Common Stock as to which ADLT has Beneficial Ownership immediately prior to
December 4, 2003 (except that this clause (F) shall pertain only until such time as ADLT has Beneficial Ownership of less than fifteen
percent (15%) of the outstanding shares of Common Stock); or 

        (G)  Trigran
Investments LP, an Illinois limited partnership (referred to collectively with their Affiliates and Associates as "Trigran"), so
long as Trigran is not the Beneficial Owner of a percentage of the outstanding shares of Common Stock that is greater (by more than one percent (1%) of the outstanding shares of Common Stock) than the
percentage of the outstanding shares of Common as to which Trigran has Beneficial Ownership immediately prior to December 4, 2003 (except that this  clause (G) shall pertain only until such
time as Trigran has Beneficial Ownership of less than fifteen percent (15%) of the outstanding shares of
Common Stock); and" 

The
definition of the term "Beneficial Owner" set forth in Section 1(a) of the Agreement such that Section 1(c)(ii) of the Agreement shall read in its entirety as follows: 

"(ii)
which such Person or any of such Person's Affiliates or Associates has (A) the right or obligation to acquire (whether such right or obligation is exercisable or effective immediately or
only after the passage of time) pursuant to any agreement, arrangement or understanding (whether or not in writing) or upon the exercise of conversion rights, exchange rights, rights (other than the
Rights), warrants or options, or otherwise; provided, however, that a Person shall not be deemed (under
this clause (A)) the "Beneficial Owner," and shall not be deemed (under this  clause (A)) to "Beneficially Own" or have
"Beneficial Ownership," of securities
tendered pursuant to a tender or exchange offer made by or on behalf of such Person or any of such Person's Affiliates or Associates until such tendered securities are accepted for payment or
exchange; or (B) the right to vote or dispose of pursuant to any agreement, arrangement or understanding (whether or not in writing); provided,  however, that a Person shall not be deemed the "Beneficial Owner," and shall not be deemed to "Beneficially
Own" or have "Beneficial Ownership," of any security under this clause (B) if the agreement,
arrangement or understanding to vote such security (1) arises solely from a revocable proxy given in response to a public proxy or consent solicitation made pursuant to, and in accordance with,
the applicable rules and regulations of the Exchange Act and (2) is not also then reportable by such Person on Schedule 13D under the Exchange Act (or any comparable or successor
report); and provided, further, that ADLT shall be deemed at any time, for purposes of this Agreement,
to have Beneficial Ownership of all shares of Common Stock which may be issued upon exercise of the warrants to purchase Common Stock issued to ADLT by the Company and outstanding at such time (the
"ADLT Warrants," regardless of 

2

 

whether
the ADLT Warrants are exercisable at such time), so long as ADLT continues to own the ADLT Warrants; and, provided,  further, that Trigran shall be deemed
at any time, for purposes of this Agreement, to have Beneficial Ownership of all shares of Common Stock which may
be issued upon exercise of the warrants to purchase Common Stock issued to Trigran by the Company and outstanding at such time (the "Trigran Warrants") (regardless of
whether the Trigran Warrants are exercisable at such time), so long as Trigran continues to own the Trigran Warrants; or" 

Section 28
of the Agreement such that it shall read in its entirety as follows: 

"Determination and Actions by the Board. For all purposes of this Agreement, any calculation of the number of shares of Common Stock outstanding at any
particular time, including for purposes of determining the particular percentage of such outstanding shares of Common Stock or any other securities of which any Person is the Beneficial Owner, shall
be made in accordance with the last sentence of Rule 13d-3(d)(1)(i) of the General Rules and Regulations under the Exchange Act as in effect on the date of this Agreement;  provided,
however, that ADLT shall be deemed, for purposes of any such calculation at any time, to have
Beneficial Ownership of all shares of Common Stock which may be issued upon exercise of any then outstanding ADLT Warrants (regardless of whether the ADLT Warrants are exercisable at such time), so
long as ADLT continues to own the ADLT Warrants; and, provided, further, that Trigran shall be deemed, for purposes of any such calculation at any time,
to have Beneficial Ownership of all shares of Common Stock which may be issued upon exercise of any then outstanding Trigran Warrants (regardless of whether the Trigran Warrants are exercisable at
such time), so long as Trigran continues to own the Trigran Warrants. Except as otherwise provided herein, the Board shall have the exclusive power and authority to administer this Agreement and to
exercise all rights and powers specifically granted to the Board or to the Company, or as may be necessary or advisable in the administration of this Agreement, including, without limitation, the
right and power to (i) interpret the provisions of this Agreement and (ii) make all determinations deemed necessary or advisable for the administration of this Agreement (including a
determination to redeem or not redeem the Rights or to amend this Agreement). All such actions, calculations, interpretations and determinations (including, for purposes of clause (y) below,
all omissions with respect to the foregoing) which are done or made by the Board in good faith, shall (x) be final, conclusive and binding on the Company, the Rights Agent, the holders of the
Rights Certificates and all other parties and (y) not subject the Board to any liability to the holders of the Rights Certificates. The Rights Agent may hereby assume without any need to
investigate that the Board has acted in good faith and shall be fully protected and incur no liability in reliance thereon." 

        This
Amendment may be executed by facsimile signature and in any number of counterparts, each which shall be deemed an original, and all of this together shall constitute one instrument.
This Amendment shall be deemed to be a contract made under the laws of the State of the Company's jurisdiction of incorporation and for all purposes shall be governed by and construed in accordance
with the laws of such state applicable to contracts to be made and to be performed entirely within such state; provided, however, that all provisions regarding the rights, duties and obligations of
the Rights Agent under the Agreement, as amended by this Amendment, shall continue to be governed by and construed in accordance with the laws of the State of New York applicable to contracts made and
to be performed entirely within such State. Except as specifically amended by this Amendment, all other terms and conditions of the Agreement shall remain in full force and effect and are hereby
ratified and confirmed. 

3

 

        IN
WITNESS WHEREOF, this Amendment No. 3 to the Rights Agreement is executed as of the date first written above. 

	 	 	FIBERSTARS, INC.
	

 	
 	

By:	

/s/  ROBERT CONNERS      

	 	 	Name:	Robert Connors
	 	 	Title:	Chief Financial Officer
	

 	
 	

MELLON INVESTOR SERVICES LLC
	

 	
 	

By:	

/s/  LISA BRENTON      

	 	 	Name:	Lisa Brenton
	 	 	Title:	Client Service Manager

4

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EXHIBIT 4.2

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EXHIBIT 4.3    
    

 
 

MEDWAVE INC. COMMON STOCK PURCHASE AGREEMENT    
    

        This Common Stock Purchase Agreement (the "Agreement") is made and entered into as of the 8th day of
January, 2004 by and between Medwave, Inc., a Delaware corporation (the "Company"), and the investors listed on Exhibit A hereto (each, an
"Investor" and together, the "Investors"). 

        For
good and valuable consideration, the receipt and adequacy of which are hereby acknowledged by the Company and the Investors, the Company and the Investors agree as follows: 

I. PURCHASE AND SALE OF STOCK  

        1.1    Sale and Issuance.    Subject to the terms and conditions of this Agreement, the Investors agree to purchase at
the Closing (as defined in Section 1.2), and the Company agrees to sell and issue to the Investors at the Closing the aggregate number of shares of the Company's common stock (the
"Common Stock") as is set forth on Exhibit A, at a per-share price of $5.00,
resulting in an aggregate purchase price as is set forth on Exhibit A (the "Offering Price"). At
the Closing, each Investor, severally and not jointly, agrees to purchase that number of shares of Common Stock as is set forth on Exhibit A. 

        1.2    Closing.    The closing of the purchase and sale contemplated hereby with respect to each Investor (the
"Closing") shall take place at the offices of Goodwin Procter LLP, in Boston, Massachusetts on January 8, 2004, or at such other time, date or
place as the Company and such Investors shall mutually agree (which time and date are referred to in this Agreement as the "Closing Date"). 

        1.3    Transactions to be Effected at the Closing.    At the Closing, the Company shall deliver to each Investor a
certificate representing the shares (the "Shares") of Common Stock purchased by such
Investor, registered in the name of the Investor or in the name of a nominee for the Investor, as directed by the Investor prior to the Closing. Thereupon, the Investor shall deliver to the Company,
by wire transfer to a bank account designated in writing by the Company, immediately available funds in an amount equal to such Investor's share of the Offering Price. 

II. REPRESENTATIONS AND WARRANTIES OF THE COMPANY  

        The Company hereby makes to the Investors the representations and warranties set forth below. 

        2.1    Organization and Good Standing.    The Company is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware and has all requisite corporate power and authority to own and lease its properties, to carry on its business as presently conducted and to carry out
the transactions contemplated hereby. The Company is duly qualified or licensed to do business as a foreign corporation under the laws of each other jurisdiction in which the character of its
properties or in which the transaction of its business makes such qualification necessary, except where the failure to be so licensed or qualified would not, individually or in the aggregate, have a
material adverse effect on the Company. 

        2.2    Authorization.    The Company has the corporate power and authority to execute and deliver this Agreement and
the Registration Rights Agreement, the form of which is attached hereto as Exhibit B (the "Registration Rights
Agreement"), and to perform its obligations hereunder and thereunder. The execution and delivery of this Agreement and the Registration Rights Agreement, the performance by the
Company of its obligations hereunder and thereunder and the consummation of the transactions contemplated hereby and thereby have been duly authorized by all requisite corporate action on the part of
the Company. This Agreement and the Registration Rights Agreement constitute legal, valid and binding obligations of the Company enforceable in accordance with their terms, except (i) as
limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of 

general
application affecting enforcement of creditors' rights generally, and (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable
remedies. 

        2.3    Capitalization.    The authorized capital stock of the Company consists of 50,000,000 shares of Common Stock,
par value $0.01 per share, of which 8,766,416 shares are duly and validly issued, outstanding, fully paid and non-assessable. Except as set forth in its SEC Documents (as hereinafter
defined) or in Schedule 2.3, there are no outstanding options, warrants, rights, commitments, preemptive rights or agreements of any kind for the
issuance or sale of, or outstanding securities convertible into, any additional shares of capital stock of any class of the Company. 

        2.4    Valid Issuance of Shares.    The Common Stock which is being purchased by the Investors hereunder, when issued,
sold and delivered in accordance with the terms hereof for the consideration expressed herein, will be duly and validly issued, fully paid and nonassessable and, based upon the representations of the
Investors in this Agreement, will be issued pursuant to exemptions from the registration requirements of applicable federal and state securities laws. 

        2.5    Compliance with Other Instruments.    The execution, delivery and performance of this Agreement by the Company
and the consummation by the Company of the transactions contemplated hereby do not (i) result in a violation of the Company's Certificate of Incorporation or the Company's Bylaws, as in effect
on the date hereof, (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of
termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Company is a party, or (iii) result in a violation of any law, rule, regulation,
order, judgment or decree applicable to the Company, or by which any property or asset of the Company is bound or affected (except for such conflicts, defaults, terminations, amendments,
accelerations, cancellations and violations as would not, individually or in the aggregate, have a material adverse effect on the Company or materially impair the Company's ability to perform under
the Agreement). 

        2.6    Securities Laws.    Assuming the accuracy of the representations of each of the Investors, no consent,
authorization, approval, permit or order of or filing with any governmental or regulatory authority is required under current laws and regulations in connection with the execution and delivery of this
Agreement or the offer, issuance, sale or delivery of the Shares, other than the qualification thereof, if required, under applicable state securities law, which qualification has been or will be
effected as a condition of these sales and the filing of a Form D with the Securities and Exchange Commission (the "SEC") in connection with the
transactions contemplated by this Agreement. The Company has not, directly or through an agent, offered the Shares or any similar securities for sale to, or solicited any offers to acquire such
securities from, persons other than the Investors. Under the circumstances contemplated by this Agreement, the offer, issuance, sale and delivery of the Shares will not, under current laws and
regulations, require compliance with the prospectus delivery or registration requirements of the Securities Act of 1933, as amended (the "Securities
Act"). 

        2.7    SEC Documents and Financial Statements.    The Company has timely filed all reports, schedules, exhibits,
forms, statements and other documents required to be filed by it with the SEC pursuant to the reporting requirements of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") (all of the foregoing filed prior to the date hereof being hereinafter referred to as the "SEC
Documents"). As of their respective dates, the SEC Documents complied in all material respects with the requirements of the Exchange Act and the rules and regulations of the
SEC promulgated thereunder applicable to such SEC Documents, and none of the SEC Documents (when read together with all exhibits included therein and financial statement schedules thereto and
documents incorporated by reference) contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances in which they were made, not misleading. The financial statements of the Company and other financial information included in the SEC Documents comply as to form
and substance in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto. Such financial statements have been prepared in
accordance with U.S. generally accepted accounting principles, consistently applied, during the periods involved (except (i) as 

may
be otherwise indicated in such financial statements or the notes thereto, or (ii) in the case of unaudited interim statements, to the extent they may not include footnotes or may be
condensed or summary statements) and fairly present in all material respects the financial position of the Company as of the dates thereof and the results of its operations and cash flows for the
periods then ended (subject, in the case of unaudited statements, to normal year-end adjustments). The Company is in compliance in all material respects with the provisions of the
Sarbanes-Oxley act of 2002 (the "Sarbanes-Oxley Act"), and the rules and regulations promulgated thereunder, that are effective, and intends to comply in all material respects with other applicable
regulations provisions of the Sarbanes-Oxley Act, and the rules and regulations promulgated thereunder, upon the effectiveness of such provisions and has no reason to believe that it will not be so
compliant in all material respects upon such effectiveness. Without limiting the generality of the foregoing, the Chief Executive Officer and the Chief Financial Officer of the Company have signed,
and the Company has furnished to the SEC, all certifications required by Section 302 and 906 of the Sarbanes-Oxley Act; such certificates contain no qualifications or exceptions to the matters
certified therein and have not been modified or withdrawn; and neither the Company nor any of its officers has received notice from any governmental entity questioning or challenging the accuracy,
completeness, form or manner of filing or submissions of such certifications. The Company is currently eligible to register the resale of the Common Stock in a secondary offering on a registration
statement on Form S-3 under the Securities Act. 

        2.8    No Brokers or Finders.    No agent, broker, investment banker or other firm or person is or will be entitled to
any broker's or finder's fee or any other commission or similar fee in connection with any of the transactions contemplated by this Agreement. 

        2.9    Absence of Certain Changes.    Except as disclosed in the SEC Documents or as disclosed on  Schedule 2.9 attached
hereto, since September 30, 2003, there has been no material adverse change in the assets, liabilities, business,
properties, operations, financial condition or results of operations of the Company. 

        2.10    Intellectual Property.    The Company owns or possesses the licenses or rights to use all patents, patent
applications, patent rights, inventions, know-how, trade secrets, trademarks, trademark applications, service marks, service names, trade names and copyrights necessary to enable it to
conducts its business as now operated (the "Intellectual Property"), except where the failure to possess such licenses or rights to use would not,
individually or in the aggregate, have a material adverse effect on the Company. The business, activities and products of the Company do not infringe any Intellectual Property of any other person,
where such infringement would, individually or in the aggregate, have a material adverse effect on the Company. No proceedings are pending, or to the knowledge of the Company threatened, that
challenge the right of the Company with respect to any Intellectual Property. 

        2.11    Nasdaq Compliance.    The Company's Common Stock is registered pursuant to Section 12(g) of the
Securities Exchange Act of 1934, as amended, and is listed on the Nasdaq SmallCap Market. The Company currently complies with the continued listing requirements of the Nasdaq Marketplace Rules and has
taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the registration of the Common Stock under the Exchange Act or delisting the Common Stock from the
Nasdaq SmallCap Market. The issuance of the Shares does not require shareholder approval, including without limitation, pursuant to the Nasdaq Marketplace Rules. 

        2.12    FDA Compliance.    The Company and the manufacture, marketing and sales of its products comply with any and
all applicable requirements of the Federal Food, Drug and Cosmetic Act, 21 U.S.C. § 301, et seq., any rules and regulations of the Food and Drug Administration promulgated thereunder, and
any similar laws outside of the United States to which the Company is subject, except where such noncompliance would not, individually or in the aggregate, have a material adverse effect on the
Company. 

        2.13    No Integrated Offering.    Neither the Company, nor any of its affiliates, nor any person acting on its
behalf, has directly or indirectly made any offers or sales in any security or solicited any offers to buy any security under circumstances that would require registration under the Securities Act of
the issuance of the Shares to the Investors. The issuance of the Shares to the Investors will not be 

integrated
with any other issuance of the company's securities (past, current or future) for purposes of the Securities Act or any applicable rules of Nasdaq. 

        2.14    Internal Accounting Controls.    The Company maintains a system of internal accounting controls sufficient to
provide reasonable assurance that (a) transactions are executed in accordance with management's general or specific authorizations, (b) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted accounting principles and to maintain asset accountability, (c) access to assets is permitted only in accordance with
management's general or specific authorization, (d) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences, and (e) financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles are
reliable. 

        2.15    Investment Company Status.    The Company is not and upon consummation of the sale of the Securities will not
be an "investment company," a company controlled by an "investment company" or an "affiliated person" or, or "promoter" or "principal underwriter" for, and "investment company" as such terms are
defined in the Investment Company Act of 1940, as amended. 

III. REPRESENTATIONS AND WARRANTIES OF THE INVESTORS  

        Each Investor hereby makes to the Company, severally and not jointly, the representations and warranties set forth below. 

        3.1    Due Authorization, Execution and Delivery.    This Agreement and the Registration Rights Agreement have each
been duly authorized by all necessary action on the part of such Investor, have been duly executed and delivered by such Investor, and are valid and binding agreements of such Investor. Such Investor
has full right, power, authority and capacity to enter into this Agreement and to carry out the transactions contemplated hereby. This Agreement and the Registration Rights Agreement are valid and
binding obligations of such Investor, enforceable in accordance with their respective terms; except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other
laws of general application affecting enforcement of creditors' rights generally, and (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other
equitable remedies. 

        3.2    Purchase Entirely for Own Account.    Each Investor acknowledges that the Shares to be acquired by such
Investor pursuant to the transactions contemplated hereby have not been registered under the Securities Act or the securities laws of any state or other jurisdiction. The Company is issuing the Shares
pursuant to an exemption to the Securities Act, and the Company's reliance on such exemption is predicated in part on the Investor's representations set forth above. The Shares are being acquired by
the Investor for investment for his own account, not as a nominee or agent, and not with a view to the sale or distribution of all or any part thereof. Such Investor represents that he does not have
any contract, undertaking, agreement or arrangement with any person to sell, transfer or grant participation to any third person with respect to any of the Shares. 

        3.3    Investment Experience.    Such Investor (i) has been afforded, prior to the execution of the Agreement,
the opportunity to ask questions of, and to receive answers from, the Company's executive officers, and to obtain any additional information, to the extent the Company has such information or could
have acquired it without unreasonable effort or expense, necessary to make an informed investment decision with respect to the purchase of the Shares, (ii) has not relied upon any
representation, warranty or statement, other than those expressly set forth in this Agreement, (iii) understands that the investment hereunder is an illiquid, high-risk investment
in which the Investor may incur a total loss, and (iv) has such knowledge and experience in financial and business matters as to be capable of evaluating the merits, risks and suitability of
its investment and can bear the entire economic risk of this investment. 

        3.4    Accredited Investor.    Such Investor is an "accredited investor" as defined in Rule 501(a) of
Regulation D promulgated under the Securities Act. 

        3.5    Restricted Securities.    The Investor understands that the Shares may be considered "restricted securities"
under the federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that under such laws and applicable regulations such
securities may not be sold, transferred or otherwise disposed of without registration under the Securities Act and any applicable state securities laws, or the availability of exemptions from
registration thereunder, and that, in the absence of an effective registration statement covering the Shares or available exemptions from registration, the Investor may be required to hold the Shares
indefinitely. 

        3.6    Further Limitations on Disposition.    Without in any way limiting the representations set forth above, such
Investor further represents that, in the absence of an effective registration statement covering the Shares, he will not sell, transfer or otherwise dispose of the Shares unless such Investor shall
have notified the Company of the proposed disposition and shall have furnished the Company with an opinion of counsel, reasonably satisfactory to the Company, that such disposition will not require
registration of such shares under the Securities Act. 

        3.7    Legend.    All certificates evidencing the Shares shall bear the following legend until such time as the Shares
are sold pursuant to an effective registration statement or in compliance with Rule 144: 

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAWS (THE "ACTS") AND MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER THE ACTS OR PURSUANT TO AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED. ADDITIONALLY, THE TRANSFER OF THESE SECURITIES IS SUBJECT TO THE CONDITIONS SPECIFIED IN THE REGISTRATION RIGHTS AGREEMENT DATED JANUARY 8, 2004 AMONG THE COMPANY AND
CERTAIN OTHER SIGNATORIES THERETO, AND NO TRANSFER OF THESE SECURITIES SHALL BE VALID OR EFFECTIVE UNTIL SUCH CONDITIONS HAVE BEEN FULFILLED

        3.8    No Brokers or Finders.    No agent, broker, investment banker or other firm or person is or will be entitled to
any broker's or finder's fee or any other commission or similar fee in connection with any of the transactions contemplated by this Agreement. 

IV. COVENANTS OF THE COMPANY  

        4.1    Eligibility to Use Form S-3.    Prior to registration and until the Company's obligations
under the Registration Rights Agreement are terminated, the Company will use commercially reasonable efforts to continue to meet the "registrant eligibility" requirements for a secondary offering set
forth in the general instructions to Form S-3 to enable the registration of the Registrable Stock (as defined in the Registration Rights Agreement). 

        4.2    Listing.    The Company will use commercially reasonable efforts to obtain and, so long as any Investor owns
any of the Shares, maintain the listing and trading of its Common Stock (including the Shares) on the Nasdaq SmallCap market and will comply in all respects with the Company's reporting, filing and
other obligations under the Nasdaq Marketplace Rules and the National Association of Securities Dealers, Inc., as applicable. The Company will promptly provide to each Investor copies of any
notices it receives regarding the de-listing of the Common Stock from Nasdaq, or any other registered stock exchange or automated quotation system on which the Common Stock is then listed. 

V. INDEMNIFICATION  

        5.1   To the fullest extent permitted by law, the Company will indemnify and hold harmless each Investor, the trustees,
partners, officers, directors, advisers and agents of each Investor, and each person, if any, who controls such Investor, against any losses, claims, damages, or liabilities (joint or several) to
which they may become subject that arise out of, or are based upon any inaccuracy in the 

representations
and warranties of the Company contained in this Agreement or the failure of the Company to perform its obligations hereunder; and the Company will reimburse each such Investor,
trustee, partner, officer, director, agent or controlling 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; provided, however, that the indemnity agreement contained in this Section V 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). 

        5.2   To the extent permitted by law, each Investor, severally and not jointly, will indemnify and hold harmless the Company,
each of its directors, each of its officers, and each person, if any, who controls the Company within the meaning of the Securities Act, against any losses, claims, damages or liabilities (joint or
several) to which the Company or any such director, officer or controlling person may become subject to that arise out of, or are based upon any inaccuracy in the representations and warranties of
such Investor or the failure of an Investor to perform its obligations hereunder; and each such Investor will reimburse any legal or other expenses reasonably incurred by the Company or any such
director, officer or controlling person, in connection with investigating or defending any such loss, claim, damage, liability or action if it is judicially determined that there was such inaccuracy
or failure to perform; provided, however, that the indemnity agreement contained in this Section V 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 Investor, which consent shall not be unreasonably withheld; provided further, that in no event shall any indemnity paid by an Investor
under this Section V exceed the net proceeds from the offering received by such Investor. 

        5.3   Promptly after receipt by an indemnified party under this Section of notice of the commencement of any action (including
any governmental action), such indemnified party shall, if a claim in respect thereof is to be made against any indemnifying party under this Section, 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 shall have the right to retain its own counsel, with
the fees and expenses to be paid by the indemnifying party; and provided further, that if there is more than one indemnified party, the indemnifying party shall pay for the fees and expenses of one
counsel for any and all indemnified parties to be mutually agreed upon by such indemnified parties, unless representation of an indemnified party by the counsel retained by the other indemnified
parties would be inappropriate due to actual or potential differing interests between such indemnified parties. The failure to deliver written notice to the indemnifying party within a reasonable time
of the commencement of any such action, if materially prejudicial to its ability to defend such action, shall relieve such indemnifying party of any liability to the indemnified party under this
Section, but the omission so to 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. The
indemnification provisions set forth in this Article V are the sole and exclusive remedies of the parties hereto. 

VI.   MISCELLANEOUS  

        6.1    Governing Law; Consent to Jurisdiction.    The Agreement shall be governed by and construed under the laws of
the State of Delaware without regard to any jurisdiction's conflicts of laws provisions. 

        6.2    Entire Agreement.    This Agreement and Exhibits and Schedules hereto, along with the Registration Rights
Agreement, constitute the entire agreement between the parties and no party shall be liable or bound to any other party in any manner by any warranties, representations or covenants except as
specifically set forth herein. The terms of this Agreement shall inure to the benefit of and be binding upon the respective heirs, personal representatives, successors and assigns of the parties
except to the extent assignability is limited herein. 

        6.3    Counterparts.    The Agreement may be executed in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same instrument. 

        6.4    Titles and Subtitles.    The titles and subtitles used in the Agreement are used for convenience only and are
not to be considered in construing or interpreting the Agreement. 

        6.5    Amendments and Waivers.    Any term of the Agreement may be amended by written agreement between the Company
and the Investors holding two-thirds of the Shares. By an instrument in writing the Investor, on the one hand, or the Company, on the other hand, may waive compliance by the other with any
term or provision of this Agreement that such other party was or is obligated to comply with or perform. 

        6.6    Severability.    If one or more provisions of this Agreement are held to be unenforceable under applicable law,
such provision shall be excluded from this Agreement and the balance of the Agreement shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms. 

        6.7    Notices.    Any notice required or permitted under this Agreement shall be given in writing and shall be deemed
effectively given upon personal delivery or upon deposit with the United States Postal Service, by registered or certified mail, postage prepaid addressed to the party at its principal home or
business address as reflected on the attached signature page. The Company's business address is: Medwave, Inc., 435 Newbury Street, Suite 206, Danvers, Massachusetts 01923. 

        6.8    Assignment.    This Agreement may not be assigned by any Investor without the prior written consent of the
Company. This Agreement may not be assigned by the Company. This Agreement shall be binding upon and enforceable by, and shall inure to the benefit of, the parties hereto and their respective
successors and permitted assigns. 

        6.9    Heartland Value Fund.    The Company understands and agrees that Heartland Group, Inc. is entering into
this Agreement solely on behalf of Heartland Value Fund and that any claims that the Company may have against Heartland Group, Inc. under this Agreement or otherwise in connection with the
transactions contemplated hereby shall only be made against the assets of Heartland Value Fund. 

        [The Remainder of this Page is Intentionally Blank.]

        IN
WITNESS WHEREOF, the parties have executed the Agreement as of the date first above written. 

	COMPANY:	 	MEDWAVE, INC.
	

 	
 	
By:	

/s/  TIMOTHY J. O'MALLEY      
 Timothy J. O'Malley
 President and Chief Executive Officer
	
INVESTORS:	
 	
TTES KATHRYN A. VAN DYKE TRUST
	

 	
 	
By:	

/s/  WILLIAM VAN DYKE      
 William Van Dyke
 Trustee

	 	 	TTES ELLEN H. VAN DYKE TRUST
	

 	
 	
By:	

/s/  WILLIAM VAN DYKE      
 William Van Dyke
 Trustee
	

 	
 	
TTES HELEN VAN DYKE TRUST
	

 	
 	
By:	

/s/  WILLIAM VAN DYKE      
 William Van Dyke
 Trustee
	

 	
 	

 	

/s/  WILLIAM D. CORNELIUSON      
 William D. Corneliuson
	

 	
 	

 	

/s/  RAYMOND LIPKIN      
 Raymond Lipkin
	

 	
 	
VAN WAGONER PRIVATE OPPORTUNITIES FUND
	

 	
 	
By:	

/s/  GARRETT VAN WAGONER      
 Garrett Van Wagoner
	

 	
 	

 	

/s/  NEIL J. GAGNON      
 Neil J. Gagnon
	

 	
 	

 	

/s/  LOIS E. GAGNON      
 Lois E. Gagnon
	

 	
 	
THE LOIS E. & NEIL J. GAGNON FOUNDATION, INC.
	

 	
 	
By:	

/s/  NEIL J. GAGNON      
 Neil J. Gagnon
	

 	
 	
GAGNON FAMILY PARTNERSHIP
	

 	
 	
By:	

/s/  NEIL J. GAGNON      
 Neil J. Gagnon

	

 	
 	
GAGNON 1999 GRANDCHILDREN'S TRUST
	

 	
 	
By:	

/s/  MAUREEN DREW      
 Maureen Drew
 Trustee
	

 	
 	
HEARTLAND GROUP INC.
	

 	
 	
By:	

/s/  NICOLE BEST      
 Nicole Best
 Treasurer and Principal Accounting Officer
	

 	
 	
CONSTABLE CAPITAL, LLC
	

 	
 	
 By: Constable Advisors, LLC

Its: Managing Member
	

 	
 	

By:	

/s/  DONALD M. CONSTABLE      
 Donald M. Constable
 Managing Member
	

 	
 	
CONSTABLE CAPITAL QP, LLC
	

 	
 	
 By: Constable Advisors, LLC

Its: Managing Member
	

 	
 	

By:	

/s/  DONALD M. CONSTABLE      
 Donald M. Constable
 Managing Member
	

 	
 	
APOGEE FUND, L.P.
	

 	
 	
 By: Paradigm Capital Corporation

Its: General Partner
	

 	
 	

By:	

/s/  EMMETT M. MURPHY      
 Emmett M. Murphy
 President

QuickLinks

EXHIBIT 4.3

MEDWAVE INC. COMMON STOCK PURCHASE AGREEMENT

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