Document:

Exhibit 10.6

 

January 22, 2009

 

Rubio’s Restaurants, Inc.

c/o Mr. Owen Hart

Cowen and Company, LLC

555 California Street, Fifth
Floor

San Francisco, CA 94104

owen.hart@cowen.com

 

Dear Owen:

 

We are pleased to submit
this preliminary indication of interest to acquire 100% of the outstanding
capital stock of Rubio’s Restaurants, Inc. (“Rubio’s” or the “Company”)
for cash consideration of $8.50 per share (the “Purchase Price”).  The transaction described in this preliminary
indication of interest would be consummated by a group consisting of Alex
Meruelo and certain of his affiliates (the “Meruelo Parties”) and Levine
Leichtman Capital Partners, Inc., or an affiliate thereof (“LLCP” and,
together with the Meruelo Parties, the “Investors”).  This preliminary indication of interest is
based on the assumption that immediately prior to the closing of the
transaction (i) there will be 10,035,077 shares of common stock of the
Company outstanding and the Company will not have issued any additional stock
options, restricted stock units or similar awards since the date of this letter,
(ii) the Company will be debt free, (iii) there will be approximately
$7.4 million of cash on the Company’s balance sheet, and (iv) the Company
will have adequate working capital to operate the business going forward in the
ordinary course.

 

The Investors (together with
cash available at Rubio’s at closing) will provide all of the capital required
to fund and close this transaction.  There
will be no third party financing required to consummate this investment and no “financing
contingency.”  Furthermore, there are no
consents required internally for either LLCP or the Meruelo Parties to fund the
transaction.  We are highly confident
that we can quickly close on the terms set forth herein.

 

Immediately following the
execution of a letter of exclusivity with Rubio’s, we will commence our
confirmatory business and legal due diligence investigation of the Company and
all of its subsidiaries and affiliates.  We
believe that within 45 to 60 days from the signing of a letter of exclusivity,
we will be able to complete our confirmatory due diligence and negotiate the
definitive documentation required to close the transaction.

 

The Meruelo Parties currently
own approximately 11.6% of Rubio’s common stock and represent the Company’s
largest non-institutional shareholder.  Alex
Meruelo is the principal shareholder, Chairman and CEO of the Meruelo Group, a
minority owned and operated holding company with vested interests in food
services, construction and engineering, real estate and private equity.  In 1986, Alex established La Pizza Loca, a
quick service restaurant catering to the Hispanic community, expanding it to
more than 50 franchised and company owned stores. 

 

 

Real estate development soon
followed and the Meruelo Group now has a diversified portfolio of
commercial/retail residential and industrial properties. In 1999, Alex
purchased the first of four construction companies and the Meruelo Group now
has a presence throughout Southern California. 
Alex is a founding shareholder and director of Commercial Bank of
California, and sits on the board of William Lyon Homes and ExaDigm, Inc.

 

Levine Leichtman Capital
Partners is a Los Angeles, California-based investment firm that manages
approximately $5.0 billion of institutional investment capital through private
equity partnerships and leveraged loan funds. LLCP is currently making new
investments through Levine Leichtman Capital Partners IV, L.P.  Successful investments in the restaurant
industry include Quizno’s Corporation, Cici’s Pizza and Wetzel’s Pretzels.

 

While
a high level of interest exists in consummating the transaction described above,
this letter is not a commitment, a contract, or an offer to enter into a
contract and should not be deemed to obligate LLCP or the Meruelo Parties in
any manner whatsoever.  This preliminary
indication of interest should not be relied upon for any reason whatsoever.

 

This
preliminary indication of interest supersedes the proposal letter delivered to
the Company’s Board of Directors by the Investors on October 13, 2009, in
its entirety.

 

We
look forward to having the opportunity to work with you and the Rubio’s team on
this transaction.

 

 

	
  Sincerely,

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Alex Meruelo

  	
   

  	
  /s/ Lauren Leichtman

  
	
  Alex Meruelo

  	
   

  	
  Lauren Leichtman

  
	
  Chairman and Chief
  Executive Officer

  	
   

  	
  Chief Executive Officer

  
	
  Meruelo Group

  	
   

  	
  Levine Leichtman Capital
  PartnersEXHIBIT 4.5

 

NEITHER THESE SECURITIES
NOR THE SECURITIES ISSUABLE UPON EXERCISE OF THESE SECURITIES HAVE BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR
SALE, SOLD, TRANSFERRED OR ASSIGNED EXCEPT PURSUANT TO (A) AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT, (B) RULE
144 UNDER THE SECURITIES ACT OR (C) IN ANOTHER TRANSACTION NOT SUBJECT TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH
APPLICABLE STATE SECURITIES LAWS OR BLUE SKY LAWS AS EVIDENCED BY A LEGAL
OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY.

 

WORLD HEART CORPORATION

WARRANT TO PURCHASE COMMON STOCK

 

	
  Warrant No.

  	
  Original Issue Date:
  January    , 2010

  

 

WORLD HEART CORPORATION, a Delaware corporation (the “Company”), hereby
certifies that, for value received,                     
or its permitted registered assigns (the “Holder”), is entitled to purchase from the Company
up to a total of                        shares of common stock (the “Common Stock”),
of the Company (each such share, a “Warrant
Share” and all
such shares, the “Warrant
Shares”) at an
exercise price per share equal to $4.90 (as adjusted from time to time as
provided in Section 10 herein, the “Exercise
Price”), at any
time and from time to time on or after the date hereof (the “Trigger Date”) and through and including 5:30 P.M.,
New York City time, on January    , 2015, (the “Expiration Date”), and subject to the following terms and
conditions:

 

1.                                      Series of Warrants. This Warrant (this “Warrant”) is one
of a series of similar warrants issued pursuant to that certain Securities
Purchase Agreement, dated January 21, 2010, by and among the Company and the
Purchasers identified therein (the “Purchase
Agreement”). All such warrants are referred to herein,
collectively, as the “Warrants.”

 

2.                                      Definitions. In addition to the terms defined
elsewhere in this Warrant, capitalized terms that are not otherwise defined
herein have the meanings given to such terms in the Purchase Agreement.

 

3.                                      Registration of Warrants. The Company shall register this
Warrant, upon records to be maintained by the Company for that purpose (the “Warrant Register”),
in the name of the record Holder (which shall include the initial Holder or, as
the case may be, any registered assignee to which this Warrant is permissibly
assigned hereunder) from time to time. The Company may deem and treat the
registered Holder of this Warrant as the absolute owner hereof for the purpose
of any exercise hereof or any distribution to the Holder, and for all other
purposes, absent actual notice to the contrary.

 

1

 

4.                                      Registration of Transfers. Subject to the restrictions on transfer
set forth in Section 4.1 of the Purchase Agreement and compliance with all
applicable securities laws, the Company shall register the transfer of all or
any portion of this Warrant in the Warrant Register, upon surrender of this
Warrant, with the Form of Assignment attached as Schedule 2  hereto duly completed and signed, to the
Company’s transfer agent or to the Company at its address specified in the
Purchase Agreement. Upon any such registration or transfer, a new warrant to
purchase Common Stock in substantially the form of this Warrant (any such new
warrant, a “New Warrant”) evidencing the portion of this Warrant
so transferred shall be issued to the transferee, and a New Warrant evidencing
the remaining portion of this Warrant not so transferred, if any, shall be
issued to the transferring Holder. The acceptance of the New Warrant by the
transferee thereof shall be deemed the acceptance by such transferee of all of
the rights and obligations of a Holder of a Warrant.

 

5.                                      Exercise and Duration of Warrants.

 

(a)                                 All or any part of this Warrant shall be
exercisable by the registered Holder at any time and from time to time on or
after the Trigger Date and through and including 5:30 P.M., New York City
time, on the Expiration Date. At 5:30 P.M., New York City time, on the
Expiration Date, the portion of this Warrant not exercised prior thereto shall
be and become void and of no value and this Warrant shall be terminated and no
longer outstanding; provided, however,
that if on the Expiration Date there is no effective Registration Statement
covering the resale of the Warrant Shares, then this Warrant shall be deemed to
have been exercised in full (to the extent not previously exercised) on a “cashless
exercise” basis at 5:30 p.m. New York City time on the Expiration Date.

 

(b)                                 The Holder may exercise this Warrant by
delivering to the Company (i) this Warrant and an exercise notice, in the
form attached as Schedule 1  hereto (the “Exercise Notice”), appropriately completed and duly signed and (ii) payment
of the Exercise Price for the number of Warrant Shares as to which this Warrant
is being exercised (which may take the form of a “cashless exercise” if so
indicated in the Exercise Notice and if a “cashless exercise” may occur at such
time pursuant to Section 11 below), and the date such items are delivered
to the Company (as determined in accordance with the notice provisions hereof)
is an “Exercise Date.”
The delivery by (or on behalf of) the Holder of the Exercise Notice and the applicable
Exercise Price as provided above shall constitute the Holder’s certification to
the Company that its representations contained in Section 3.2(b), (c) and
(d) of the Purchase Agreement are true and correct as of the Exercise Date
as if remade in their entirety (or, in the case of any transferee Holder that
is not a party to the Purchase Agreement, such transferee Holder’s
certification to the Company that such representations are true and correct as
to such assignee Holder as of the Exercise Date). If the Warrant Shares are to
be issued free of all restrictive legends, the Company shall, upon the written
request of the Holder, use its best efforts to deliver, or cause to be
delivered, Warrant Shares hereunder electronically through The Depository Trust
Company or another established clearing corporation performing similar
functions, if available; provided, that, the Company may, but will not be
required to, change its transfer agent if its current transfer agent cannot
deliver Warrant Shares electronically through such a clearing corporation.  If (1) a certificate representing the
Warrant Shares is not delivered to the Holder within three (3) Trading
Days of the due exercise of this Warrant by the Holder and (2) prior to
the time such certificate is received by the Holder, the Holder, or any third
party on behalf of the Holder or for the Holder’s 

 

2

 

account, purchases (in an open market transaction or
otherwise) shares of Common Stock to deliver in satisfaction of a sale by the
Holder of shares represented by such certificate (a “Buy-In”), then the
Company shall pay in cash to the Holder (for costs incurred either directly by
such Holder or on behalf of a third party) the amount by which the total
purchase price paid for Common Stock as a result of the Buy-In (including
brokerage commissions, if any) exceeds the proceeds received by such Holder as
a result of the sale to which such Buy-In relates.  The Holder shall provide the Company written
notice indicating the amounts payable to the Holder in respect of the Buy-In.

 

6.                                      Delivery of Warrant Shares.

 

(a)                                 Upon exercise of this Warrant, the
Company shall promptly (but in no event later than three (3) Trading Days
after the Exercise Date) issue or cause to be issued and cause to be delivered
to or upon the written order of the Holder and in such name or names as the
Holder may designate (provided that, if the Holder directs the Company to
deliver a certificate for the Warrant Shares in a name other than that of the
Holder or an Affiliate of the Holder, it shall deliver to the Company on the
Exercise Date (i) if the Registration Statement is not effective, an
opinion of counsel reasonably satisfactory to the Company to the effect that
the issuance of such Warrant Shares in such other name may be made pursuant to
an available exemption from the registration requirements of the Securities Act
and all applicable state securities or blue sky laws or (ii) if the
Registration Statement is effective, either an opinion of counsel reasonably
satisfactory to the Company to the effect that the issuance of such Warrant
Shares in such other name may be made pursuant to an available exemption from
the registration requirements of the Securities Act and all applicable state securities
or blue sky laws or a Certificate of Subsequent Sale in substantially the form
attached as Exhibit I to the Purchase Agreement), a certificate for the
Warrant Shares issuable upon such exercise. The Holder, or any Person
permissibly so designated by the Holder to receive Warrant Shares, shall be
deemed to have become the holder of record of such Warrant Shares as of the
Exercise Date. If the Warrant Shares are to be issued free of all restrictive
legends, the Company shall, upon the written request of the Holder, use its
best efforts to deliver, or cause to be delivered, Warrant Shares hereunder
electronically through The Depository Trust Company or another established
clearing corporation performing similar functions, if available; provided,
that, the Company may, but will not be required to, change its transfer agent
if its current transfer agent cannot deliver Warrant Shares electronically
through such a clearing corporation.

 

(b)                                 The Company’s obligations to issue and
deliver Warrant Shares in accordance with the terms hereof are absolute and
unconditional, irrespective of any action or inaction by the Holder to enforce
the same, any waiver or consent with respect to any provision hereof, the
recovery of any judgment against any Person or any action to enforce the same,
or any setoff, counterclaim, recoupment, limitation or termination, or any
breach or alleged breach by the Holder or any other Person of any obligation to
the Company or any violation or alleged violation of law by the Holder or any other
Person, and irrespective of any other circumstance which might otherwise limit
such obligation of the Company to the Holder in connection with the issuance of
Warrant Shares. Nothing herein shall limit the Holder’s right to pursue any
other remedies available to it hereunder, at law or in equity including,
without limitation, a decree of specific performance and/or injunctive relief
with respect to the Company’s failure to timely deliver Common Stock upon
exercise of this Warrant as required pursuant to the terms hereof.

 

3

 

7.                                      Charges, Taxes and Expenses. Issuance and delivery of certificates
for shares of Common Stock upon exercise of this Warrant shall be made without
charge to the Holder for any issue or transfer tax, withholding tax, transfer
agent fee or other incidental tax or expense in respect of the issuance of such
certificates, all of which taxes and expenses shall be paid by the Company;  provided,
however , that the Company shall not be required to pay any tax
which may be payable in respect of any transfer involved in the registration of
any certificates for Warrant Shares or Warrants in a name other than that of
the Holder or an Affiliate thereof. The Holder shall be responsible for all other
tax liability that may arise as a result of holding or transferring this
Warrant or receiving Warrant Shares upon exercise hereof.

 

8.                                      Replacement of Warrant. If this Warrant is mutilated, lost,
stolen or destroyed, the Company shall issue or cause to be issued in exchange
and substitution for and upon cancellation hereof, or in lieu of and
substitution for this Warrant, a New Warrant, but only upon receipt of evidence
reasonably satisfactory to the Company of such loss, theft or destruction (in
such case) and, in each case, a customary and reasonable indemnity agreement.
If a New Warrant is requested as a result of a mutilation of this Warrant, then
the Holder shall deliver such mutilated Warrant to the Company as a condition
precedent to the Company’s obligation to issue the New Warrant.

 

9.                                      Reservation of Warrant Shares. The Company covenants that it will
reserve and keep available out of the aggregate of its authorized but unissued
and otherwise unreserved Common Stock, solely for the purpose of enabling it to
issue Warrant Shares upon exercise of this Warrant as herein provided, the
number of Warrant Shares which are initially issuable and deliverable upon the
exercise of this entire Warrant, free from preemptive rights or any other
contingent purchase rights of persons other than the Holder (taking into
account the adjustments and restrictions of Section 10). The Company
covenants that all Warrant Shares so issuable and deliverable shall, upon
issuance and the payment of the applicable Exercise Price in accordance with
the terms hereof, be duly and validly authorized, issued and fully paid and
nonassessable. The Company will take all such action as may be reasonably
necessary to assure that such shares of Common Stock may be issued as provided
herein without violation of any applicable law or regulation, or of any
requirements of any securities exchange or automated quotation system upon
which the Common Stock may be listed.

 

10.                               Certain Adjustments. The Exercise Price and number of
Warrant Shares issuable upon exercise of this Warrant are subject to adjustment
from time to time as set forth in this Section 10.

 

(a)                                 Stock Dividends and Splits. If the Company, at any time while this
Warrant is outstanding, (i) pays a stock dividend on its Common Stock or
otherwise makes a distribution on any class of capital stock that is payable in
shares of Common Stock, (ii) subdivides its outstanding shares of Common
Stock into a larger number of shares, or (iii) combines its outstanding
shares of Common Stock into a smaller number of shares, then in each such case
the Exercise Price shall be multiplied by a fraction, the numerator of which
shall be the number of shares of Common Stock outstanding immediately before
such event and the denominator of which shall be the number of shares of Common
Stock outstanding immediately after such event. Any adjustment made pursuant to
clause (i) of this paragraph shall become effective immediately after the
record date for the determination of stockholders entitled to 

 

4

 

receive such dividend or distribution, and
any adjustment pursuant to clause (ii) or (iii) of this paragraph
shall become effective immediately after the effective date of such subdivision
or combination.

 

(b)                                 Pro Rata Distributions. If the Company, at any time while this
Warrant is outstanding, distributes to all holders of Common Stock (i) evidences
of its indebtedness, (ii) any security (other than a distribution of
Common Stock covered by the preceding paragraph), or (iii) any other asset
(in each case, “Distributed
Property”), then, upon any exercise of this Warrant that occurs
after the record date fixed for determination of stockholders entitled to
receive such distribution, the Holder shall be entitled to receive, in addition
to the Warrant Shares otherwise issuable upon such exercise (if applicable),
the Distributed Property that such Holder would have been entitled to receive
in respect of such number of Warrant Shares had the Holder been the record
holder of such Warrant Shares immediately prior to such record date.

 

(c)                                  Fundamental Transactions. If any capital reorganization,
reclassification of the capital stock of the Company, consolidation or merger
of the Company with another corporation in which the Company is not the
survivor, or sale, transfer or other disposition of all or substantially all of
the Company’s assets to another corporation shall be effected (Each a “Fundamental Transaction”),
then, as a condition of such Fundamental Transaction, lawful and adequate
provision shall be made whereby each Holder shall thereafter have the right to
purchase and receive upon the basis and upon the terms and conditions herein
specified and in lieu of the Warrant Shares immediately theretofore issuable
upon exercise of the Warrant, such shares of stock, securities or assets as
would have been issuable or payable with respect to or in exchange for a number
of Warrant Shares equal to the number of Warrant Shares immediately theretofore
issuable upon exercise of the Warrant, had such Fundamental Transaction not
taken place, and in any such case appropriate provision shall be made with
respect to the rights and interests of each Holder to the end that the
provisions hereof (including, without limitation, provision for adjustment of
the Exercise Price) shall thereafter be applicable, as nearly equivalent as may
be practicable in relation to any shares of stock, securities or assets
thereafter deliverable upon the exercise hereof.  The Company shall not effect any such
Fundamental Transaction unless prior to or simultaneously with the consummation
thereof the successor corporation (if other than the Company) resulting from
such consolidation or merger, or the corporation purchasing or otherwise
acquiring such assets or other appropriate corporation or entity shall assume
the obligation to deliver to the Holder, at the last address of the Holder
appearing on the books of the Company, such shares of stock, securities or
assets as, in accordance with the foregoing provisions, the Holder may be
entitled to purchase, and the other obligations under this Warrant.  The provisions of this paragraph (c) shall
similarly apply to successive Fundamental Transactions.

 

(d)                                 Number of Warrant Shares. Simultaneously with any adjustment to
the Exercise Price pursuant to paragraph (a) of this Section, the number
of Warrant Shares that may be purchased upon exercise of this Warrant shall be
increased or decreased proportionately, so that after such adjustment the
aggregate Exercise Price payable hereunder for the increased or decreased
number of Warrant Shares shall be the same as the aggregate Exercise Price in
effect immediately prior to such adjustment.

 

5

 

(e)                                  Calculations. All calculations under this Section 10
shall be made to the nearest cent or the nearest share, as applicable.

 

(f)                                   Notice of Adjustments. Upon the occurrence of each adjustment
pursuant to this Section 10, the Company at its expense will promptly
compute such adjustment, in good faith, in accordance with the terms of this
Warrant and prepare a certificate setting forth such adjustment, including a
statement of the adjusted Exercise Price and adjusted number or type of Warrant
Shares or other securities issuable upon exercise of this Warrant (as
applicable), describing the transactions giving rise to such adjustments and
showing in detail the facts upon which such adjustment is based. Upon written
request, the Company will promptly deliver a copy of each such certificate to
the Holder and to the Company’s transfer agent.

 

(g)                                 Notice of Corporate Events. If, while this Warrant is outstanding,
the Company (i) declares a dividend or any other distribution of cash,
securities or other property in respect of its Common Stock, including, without
limitation, any granting of rights or warrants to subscribe for or purchase any
capital stock of the Company or any subsidiary, (ii) authorizes or
approves, enters into any agreement contemplating or solicits stockholder
approval for any Fundamental Transaction or (iii) authorizes the voluntary
dissolution, liquidation or winding up of the affairs of the Company, then,
except if such notice and the contents thereof shall be deemed to constitute
material non-public information, the Company shall deliver to the Holder a
notice of such transaction at least ten (10) Trading Days prior to the
applicable record or effective date on which a Person would need to hold Common
Stock in order to participate in or vote with respect to such transaction;  provided, however,
that the failure to deliver such notice or any defect therein shall not affect
the validity of the corporate action required to be described in such notice.

 

11.                               Payment of Exercise Price. The Holder shall pay the Exercise Price
in immediately available funds; provided,
however, that the Holder may, in its sole discretion, satisfy its
obligation to pay the Exercise Price through a “cashless exercise”, in which
event the Company shall issue to the Holder the number of Warrant Shares
determined as follows:

 

 

where:

 

X                                       =                                         the number of Warrant Shares to be issued to the
Holder.

 

Y                                       =                                         the total
number of Warrant Shares with respect to which this Warrant is being exercised.

 

A                                       =                                         the Closing Sale Price of the shares of Common Stock
(as reported by Bloomberg Financial Markets) on the date immediately preceding
the Exercise Date.

 

B                                       =                                         the Exercise Price then in effect for the applicable
Warrant Shares at the time of such exercise.

 

6

 

For purposes of this Warrant, “Closing Sale Price” means, for any security
as of any date, the last trade price for such security on the principal
securities exchange or trading market for such security, as reported by
Bloomberg Financial Markets, or, if such exchange or trading market begins to
operate on an extended hours basis and does not designate the last trade price,
then the last trade price of such security prior to 4:00 P.M., New York
City time, as reported by Bloomberg Financial Markets, or if the foregoing do
not apply, the last trade price of such security in the over-the-counter market
on the electronic bulletin board for such security as reported by Bloomberg
Financial Markets, or, if no last trade price is reported for such security by
Bloomberg Financial Markets, the average of the bid prices, or the ask prices,
respectively, of any market makers for such security as reported in the “pink
sheets” by Pink Sheets LLC. If the Closing Sale Price cannot be calculated for
a security on a particular date on any of the foregoing bases, the Closing Sale
Price of such security on such date shall be the fair market value as mutually
determined by the Company and the Holder. If the Company and the Holder are
unable to agree upon the fair market value of such security, then the Board of
Directors of the Company shall use its good faith judgment to determine the
fair market value. The Board of Directors’ determination shall be binding upon
all parties absent demonstrable error. All such determinations shall be
appropriately adjusted for any stock dividend, stock split, stock combination
or other similar transaction during the applicable calculation period.

 

For purposes of Rule 144 promulgated under the
Securities Act, it is intended, understood and acknowledged that the Warrant
Shares issued in a cashless exercise transaction shall be deemed to have been
acquired by the Holder, and the holding period for the Warrant Shares shall be
deemed to have commenced, on the date this Warrant was originally issued
pursuant to the Purchase Agreement (provided that the Commission continues to
take the position that such treatment is proper at the time of such exercise).

 

12.                               No Fractional Shares. No fractional Warrant Shares will be
issued in connection with any exercise of this Warrant. In lieu of any
fractional shares which would otherwise be issuable, the number of Warrant
Shares to be issued shall be rounded down to the next whole number and the
Company shall pay the Holder in cash the fair market value (based on the
Closing Sale Price) for any such fractional shares.

 

13.                               Notices. Any and all notices or other
communications or deliveries hereunder (including, without limitation, any
Exercise Notice) shall be in writing and shall be deemed given and effective on
the earliest of (i) the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number specified in
the Purchase Agreement prior to 5:30 P.M., New York City time, on a
Trading Day, (ii) the next Trading Day after the date of transmission, if
such notice or communication is delivered via facsimile at the facsimile number
specified in the Purchase Agreement on a day that is not a Trading Day or later
than 5:30 P.M., New York City time, on any Trading Day, (iii) the
Trading Day following the date of mailing, if sent by nationally recognized
overnight courier service specifying next business day delivery, or (iv) upon
actual receipt by the party to whom such notice is required to be given, if by
hand delivery. The address and facsimile number of a party for such notices or
communications shall be as set forth in the Purchase Agreement unless changed
by such party by two (2) Trading Days’ prior notice to the other party in
accordance with this Section 13.

 

7

 

14.                               Warrant Agent. The Company shall serve as warrant
agent under this Warrant. Upon thirty (30) days’ notice to the Holder, the
Company may appoint a new warrant agent. Any corporation into which the Company
or any new warrant agent may be merged or any corporation resulting from any
consolidation to which the Company or any new warrant agent shall be a party or
any corporation to which the Company or any new warrant agent transfers
substantially all of its corporate trust or shareholders services business shall
be a successor warrant agent under this Warrant without any further act. Any
such successor warrant agent shall promptly cause notice of its succession as
warrant agent to be mailed (by first class mail, postage prepaid) to the Holder
at the Holder’s last address as shown on the Warrant Register.

 

15.                               Miscellaneous.

 

(a)                                 No Rights as a Stockholder. The Holder, solely in such Person’s
capacity as a holder of this Warrant, shall not be entitled to vote or receive
dividends (subject to the effect of such dividends as set forth in Section 10(a) hereof)
or be deemed the holder of share capital of the Company for any purpose, nor
shall anything contained in this Warrant be construed to confer upon the
Holder, solely in such Person’s capacity as the Holder of this Warrant, any of
the rights of a stockholder of the Company or any right to vote, give or
withhold consent to any corporate action (whether any reorganization, issue of
stock, reclassification of stock, consolidation, merger, amalgamation,
conveyance or otherwise), receive notice of meetings, receive dividends or
subscription rights, or otherwise, prior to the issuance to the Holder of the
Warrant Shares which such Person is then entitled to receive upon the due
exercise of this Warrant. In addition, nothing contained in this Warrant shall
be construed as imposing any liabilities on the Holder to purchase any
securities (upon exercise of this Warrant or otherwise) or as a stockholder of
the Company, whether such liabilities are asserted by the Company or by
creditors of the Company.

 

(b)                                 Successors and Assigns. Subject to the restrictions on transfer
set forth in this Warrant and in Section 4.1 of the Purchase Agreement,
and compliance with applicable securities laws, this Warrant may be assigned by
the Holder. This Warrant may not be assigned by the Company without the written
consent of the Holder except to a successor in the event of a Fundamental
Transaction. This Warrant shall be binding on and inure to the benefit of the
parties hereto and their respective successors and assigns. Subject to the
preceding sentence, nothing in this Warrant shall be construed to give to any
Person other than the Company and the Holder any legal or equitable right,
remedy or cause of action under this Warrant. This Warrant may be amended only
in writing signed by the Company and the Holder, or their successors and
assigns.

 

(c)                                  Governing Law; Jurisdiction. ALL QUESTIONS CONCERNING THE
CONSTRUCTION, VALIDITY, ENFORCEMENT AND INTERPRETATION OF THIS WARRANT SHALL BE
GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAW THEREOF. EACH
PARTY HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE STATE AND
FEDERAL COURTS SITTING IN THE CITY OF NEW YORK, BOROUGH OF MANHATTAN, FOR THE
ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR WITH ANY
TRANSACTION CONTEMPLATED HEREBY OR DISCUSSED HEREIN (INCLUDING WITH RESPECT TO
THE ENFORCEMENT OF 

 

8

 

ANY OF THE TRANSACTION DOCUMENTS), AND HEREBY
IRREVOCABLY WAIVES, AND AGREES NOT TO ASSERT IN ANY SUIT, ACTION OR PROCEEDING,
ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE JURISDICTION OF ANY SUCH
COURT. EACH PARTY HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND
CONSENTS TO PROCESS BEING SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING BY
MAILING A COPY THEREOF VIA REGISTERED OR CERTIFIED MAIL OR OVERNIGHT DELIVERY
(WITH EVIDENCE OF DELIVERY) TO SUCH PARTY AT THE ADDRESS IN EFFECT FOR NOTICES
TO IT UNDER THE PURCHASE AGREEMENT AND AGREES THAT SUCH SERVICE SHALL
CONSTITUTE GOOD AND SUFFICIENT SERVICE OF PROCESS AND NOTICE THEREOF. NOTHING
CONTAINED HEREIN SHALL BE DEEMED TO LIMIT IN ANY WAY ANY RIGHT TO SERVE PROCESS
IN ANY MANNER PERMITTED BY LAW. EACH PARTY HEREBY WAIVES ALL RIGHTS TO A TRIAL
BY JURY.

 

(d)                                 Headings. The headings herein are for convenience
only, do not constitute a part of this Warrant and shall not be deemed to limit
or affect any of the provisions hereof.

 

(e)                                  Severability. In case any one or more of the
provisions of this Warrant shall be invalid or unenforceable in any respect,
the validity and enforceability of the remaining terms and provisions of this
Warrant shall not in any way be affected or impaired thereby, and the parties
will attempt in good faith to agree upon a valid and enforceable provision
which shall be a commercially reasonable substitute therefor, and upon so
agreeing, shall incorporate such substitute provision in this Warrant.

 

[SIGNATURE PAGE FOLLOWS]

 

9

 

IN WITNESS WHEREOF, the Company has caused this Warrant to be duly
executed by its authorized officer as of the date first indicated above.

 

 

	
   

  	
  WORLD
  HEART CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  

 

 

SCHEDULE 1

FORM OF EXERCISE NOTICE

 

(To be executed by the Holder to purchase shares of Common Stock under
the foregoing Warrant)

 

Ladies and Gentlemen:

 

(1)           The undersigned is the Holder of Warrant No.                  
(the “Warrant”) issued by World Heart
Corporation, a Delaware corporation (the “Company”).
Capitalized terms used herein and not otherwise defined herein have the
respective meanings set forth in the Warrant.

 

(2)           The undersigned hereby exercises its
right to purchase                  
Warrant Shares pursuant to the Warrant.

 

(3)           The Holder intends that payment of the
Exercise Price shall be made as (check one):

 

o            Cash Exercise

 

o            “Cashless Exercise” under Section 11

 

(4)           If the Holder has elected a Cash
Exercise, the Holder shall pay the sum of $                  
in immediately available funds to the Company in accordance with the terms of
the Warrant.

 

(5)           Pursuant to this Exercise Notice, the
Company shall deliver to the Holder                  
Warrant Shares in accordance with the terms of the Warrant.

 

	
  Dated:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Name of Holder:

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  

 

(Signature must conform
in all respects to name of Holder as specified on the face of the Warrant)

 

 

SCHEDULE 2

WORLD HEART CORPORATION

FORM OF ASSIGNMENT

 

[To be completed and
signed only upon transfer of Warrant]

 

FOR VALUE RECEIVED, the undersigned hereby sells,
assigns and transfers unto             
(the “Transferee”) the right
represented by the within Warrant to purchase             
shares of Common Stock of World Heart Corporation (the “Company”)
to which the within Warrant relates and appoints             
attorney to transfer said right on the books of the Company with full power of
substitution in the premises.

 

 

	
  Dated:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (Signature
  must conform in all respects to name of

  holder as specified on the face of the Warrant)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address
  of Transferee

  
	
   

  	
   

  	
   

  
	
  In the presence of:

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