SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) June 30, 1998
_______________
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
_____________________________________________________
(Exact name of registrant as specified in its charter)
Delaware 1-11596 58-1954497
________________ _________________ ___________________
(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification No.)
incorporation)
1940 N.W. 67th Place, Suite A, Gainesville, Florida 32653
________________________________________________ _________
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (352) 373-4200
________________
Not applicable
_________________________________________________________________
(Former name or former address, if changed since last report)
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Item 5. Other Events.
____________
Pursuant to the terms of a Private Securities Subscription
Agreement ("Subscription Agreement"), effective as of June 30, 1998,
between Perma-Fix Environmental Services, Inc. (the "Company") and
RBB Bank Aktiengesellschaft, located in Graz, Austria ("RBB Bank"),
the Company issued to RBB Bank 3,000 shares of newly created Series
10 Class J Convertible Preferred Stock, par value $.001 per share
("Series 10 Preferred"), at a price of $1,000 per share, for an
aggregate sales price of $3,000,000. The sale to RBB Bank was made
in a private placement under Section 4(2) of the Securities Act of
1933, as amended (the "Act"), and/or Rule 506 of Regulation D under
the Act. The Series 10 Preferred has a liquidation value equal to
$1,000 per outstanding share of Series 10 Preferred (the "Liquidation
Value"), and has a liquidation preference over the Company's Common
Stock, par value $.001 per share ("Common Stock"), equal to the
aggregate Liquidation Value for all of the then outstanding shares
of Series 10 Preferred plus an amount equal to all unpaid dividends
accrued thereon. The Series 10 Preferred accrues dividends on a
cumulative basis at a rate of four percent (4%) per annum of the
Liquidation Value ("Dividend Rate"), and is payable semi-annually
when and as declared by the Board of Directors. No dividends or other
distributions may be paid or declared or set aside for payment on
the Company's Common Stock until all accrued and unpaid dividends
on all outstanding shares of Series 10 Preferred have been paid or
set aside for payment. Dividends may be paid, at the option of the
Company, in the form of cash or Common Stock. If the Company pays
dividends in Common Stock, such is payable in the number of shares
of Common Stock equal to the product of (a) the quotient of (i) the
Dividend Rate divided by (ii) the average of the closing bid
quotation of the Common Stock as reported on the National
Association of Securities Dealers Automated Quotation system
("NASDAQ"), or if the Common Stock is not listed for trading on the
NASDAQ but is listed for trading on a national securities exchange,
the average closing bid price of the Common Stock as quoted on such
national securities exchange, for the five (5) trading days
immediately prior to the date the dividend is declared, times (b)
a fraction, the numerator of which is the number of days elapsed
during the period for which the dividend is to be paid, and the
denominator of which is 365.
The holder of the Series 10 Preferred may convert into Common
Stock any or all of the Series 10 Preferred on and after 180 days
after June 30, 1998. The conversion price per outstanding share of
Preferred Stock ("Conversion Price") is $1.875; except that if the
average of the closing bid price per share of Common Stock quoted on
the NASDAQ (or the closing bid price of the Common Stock as quoted
on the national securities exchange if the Common Stock is not listed
for trading on the NASDAQ but is listed for trading on a national
securities exchange) for the five (5) trading days immediately prior
to the particular date on which the holder notified the Company of a
conversion ("Conversion Date") is less than $2.34, then the Conversion
Price for that particular conversion shall be eighty percent (80%) of the
average of the closing bid price of the Common Stock on the NASDAQ
(or if the Common Stock is not listed for trading on the NASDAQ but
is listed for trading on a national securities exchange then eighty
percent (80%) of the average of the closing bid price of the Common
Stock on the national securities exchange) for the five (5) trading
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days immediately prior to the particular Conversion Date. As of
June 30, 1998, the closing price of Common Stock on the NASDAQ was
$1.875 per share.
As part of the sale of the Series 10 Preferred, the Company
also issued to RBB Bank (a) a warrant entitling the holder to
purchase up to an aggregate of 150,000 shares of Common Stock at an
exercise price of $2.50 per share of Common Stock expiring three (3)
years after June 30, 1998 and (b) a warrant entitling the holder to
purchase up to an aggregate of 200,000 shares of Common Stock at an
exercise price of $1.875 per share of Common Stock and expiring three
(3) years after June 30, 1998. Collectively, these warrants are
referred to herein as the "RBB Warrants." The Common Stock
issuable upon the conversion of the Series 10 Preferred and upon
the exercise of the RBB Warrants is subject to certain registration
rights pursuant to the Subscription Agreement.
The Company intends to utilize the proceeds received on the
sale of Series 10 Preferred for working capital and/or to reduce
the outstanding balance of its credit facilities, subject to the
Company reborrowing under such credit facilities.
In addition to the 2,200,000 shares of Common Stock which have
been reserved for issuance upon conversion of the Series 10 Preferred,
and in payment of dividends accrued thereon and upon exercise of the RBB
Warrants, RBB Bank may also be considered to be the beneficial owner
of approximately 7,958,687 shares of the Company's Common Stock consisting
of (a) 931,786 shares of Common Stock held directly by RBB Bank;
(b) 4,051,335 shares of Common Stock issuable upon conversion of 6,500
shares of other series of convertible preferred stock previously issued by
the Company to RBB Bank, subject to variation depending upon, among other
things, the market price per share of Common Stock at the time of conversion
and various terms and conditions of the preferred; (c) 319,316 shares of
Common Stock which may be issued in payment of dividends accrued on such
6,500 shares of convertible preferred stock; and, (d) 2,656,250 shares of
Common Stock that RBB Bank has the right to acquire upon exercise of
various warrants previously issued by the Company to RBB Bank, consisting
of (i) warrants entitling the holder to purchase up to an aggregate of
1,000,000 shares of Common Stock at an exercise price of $2.00 per share of
Common Stock; (ii) warrants entitling the holder to purchase up to
an aggregate of 1,000,000 shares of Common Stock at an exercise
price of $3.50 per share of Common Stock; (iii) warrants entitling the
holder to purchase up to an aggregate of 375,000 shares of Common Stock
at an exercise price of $1.875 per share of Common Stock; and,
(iv) warrants entitling the holder to purchase up to an aggregate
of 281,250 shares of Common Stock at an exercise price of $2.125
per share of Common Stock. If RBB Bank were to obtain 10,158,687
shares of Common Stock through exercise of all of its warrants and
conversion of all of its preferred stock into Common Stock it would
hold approximately 47.9% of the outstanding Common Stock of the
Company based upon 12,001,746 shares of Common Stock issued and
outstanding as of July 17, 1998 (excluding 920,000 shares held as
treasury stock). The foregoing estimate assumes that no other shares
of Common Stock are issued by the Company, no other warrants or options
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granted by the Company and currently outstanding are exercised, the
Company does not acquire additional shares of Common Stock as treasury
stock, and RBB Bank does not dispose of any shares of Common Stock.
In connection with the placement of Series 10 Preferred to RBB
Bank, the Company paid fees (excluding legal and accounting) of
$210,000 and issued to (a) Liviakis Financial Communications, Inc.
("Liviakis") for assistance with the placement of the Series 10
Preferred, warrants entitling the holder to purchase up to an
aggregate of 1,875,000 shares of Common Stock, subject to certain
anti-dilution provisions, at an exercise price of $1.875 per share
of Common Stock, which warrants may be exercised after January 15,
1999, and which expire after four (4) years; (b) Robert B. Prag,
an executive officer of Liviakis for assistance with the placement of
the Series 10 Preferred, warrants entitling the holder to purchase
up to an aggregate of 625,000 shares of Common Stock, subject to
certain anti-dilution provisions, at an exercise price of $1.875
per share of Common Stock, which warrants may be exercised after
January 15, 1999, and which expire after four (4) years; (c) JW
Genesis Financial Corporation for assistance with the placement
of the Series 10 Preferred, warrants entitling the holder
to purchase up to an aggregate of 150,000 shares of Common Stock,
subject to certain anti-dilution provisions, at an exercise price of
$1.875 per share of Common Stock, which warrants expire after three
(3) years; and (d) Fontenoy Investments for assistance with the placement
of the Series 10 Preferred, warrants entitling the holder to purchase up to
an aggregate of 350,000 shares of Common Stock, subject to certain
anti-dilution provisions, at an exercise price of $1.875 per share of
Common Stock, which warrants expire after three (3) years. Under the
terms of each warrant, the holder is entitled to certain registration
rights with respect to the shares of Common Stock issuable on the
exercise of each warrant.
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Item 7. Financial Statements and Exhibits.
_________________________________
(c) Exhibits.
4.1 Private Securities Subscription Agreement, dated
June 30, 1998, between the Company and RBB Bank
Aktiengesellschaft.
4.2 Certificate of Designations of Series 10 Class J
Convertible Preferred Stock, dated July 16, 1998.
4.3 Specimen copy of Certificate relating to the Series
10 Class J Convertible Preferred Stock.
4.4 Common Stock Purchase Warrant ($2.50) dated
June 30, 1998, between the Company and RBB Bank
Aktiengesellschaft.
4.5 Common Stock Purchase Warrant ($1.875) dated
June 30, 1998, between the Company and RBB Bank
Aktiengesellschaft.
4.6 Consulting Agreement dated effective June 30, 1998,
between the Company and Liviakis Financial
Communications, Inc.
4.7 Common Stock Purchase Warrant ($1.875) effective
June 30, 1998, between the Company and Liviakis
Financial Communications, Inc.
4.8 Common Stock Purchase Warrant ($1.875) effective
June 30, 1998, between the Company and Robert B.
Prag.
* * * * * * *
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
PERMA-FIX ENVIRONMENTAL
SERVICES, INC.
By: /s/ Richard T. Kelecy
____________________________
Richard T. Kelecy
Chief Financial Officer
Date: July 17, 1998
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Exhibit Index
Exhibit Sequential
No. Description Page No.
_______ ___________ __________
4.1 Private Securities Subscription
Agreement, dated June 30, 1998,
between the Company and RBB Bank
Aktiengesellschaft. 8
4.2 Certificate of Designations of
Series 10 Class J Convertible
Preferred Stock, dated July 16,
1998. 27
4.3 Specimen copy of Certificate
relating to the Series 10 Class
J Convertible Preferred Stock. 37
4.4 Common Stock Purchase Warrant
($2.50) dated June 30, 1998,
between the Company and RBB Bank
Aktiengesellschaft. 38
4.5 Common Stock Purchase Warrant
($1.875) dated June 30, 1998,
between the Company and RBB
Bank Aktiengesellschaft. 45
4.6 Consulting Agreement dated
effective June 30, 1998,
between the Company and Liviakis
Financial Communications, Inc. 52
4.7 Common Stock Purchase Warrant
($1.875) effective June 30, 1998,
between the Company and Liviakis
Financial Communications, Inc. 63
4.8 Common Stock Purchase Warrant
($1.875) effective June 30, 1998,
between the Company and Robert B.
Prag. 76
PRIVATE SECURITIES SUBSCRIPTION AGREEMENT
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
(Regulation "D")
THIS PRIVATE SECURITIES SUBSCRIPTION AGREEMENT (hereinafter
"Agreement") has been executed by the undersigned in connection
with the purchase in a private placement pursuant to Section 4(2)
of the Securities Act of 1933, as amended (the "Act"), and
Regulation D as promulgated under the Act of certain Series 10
Class J Convertible Preferred Stock (hereinafter the "Preferred"),
containing such terms, conditions, qualifications and restrictions
as set forth in the Certificate of Designations attached hereto as
Exhibit A ("Certificate of Designations), convertible into shares
of the Company's (as defined below) common stock, par value $.001
per share (hereinafter "Shares"), and certain Warrants (hereinafter
"Warrants") exercisable into Shares ("Warrant Shares"), from PERMA-
FIX ENVIRONMENTAL SERVICES, INC., 1940 N.W. 67th Place,
Gainseville, Florida, 32653, USA, a corporation organized under the
laws of Delaware (hereinafter the "Company" or "Seller") by RBB
Bank Aktiengesellschaft, a bank, located in Austria, organized
under the laws of Austria, (hereinafter "Buyer"). Seller and Buyer
(hereinafter collectively the "parties") each hereby represent,
warrant and agree as follows:
1. AGREEMENT TO SUBSCRIBE; PURCHASE PRICE:
(i) Seller and Buyer are executing and delivering this Agreement
in reliance upon the exemption from securities registration
afforded by Section 4(2) of the Act and/or Rule 506 under
Regulation D ("Regulation D") as promulgated by the United States
Securities and Exchange Commission (the "Commission") under the
Act; and
(ii) Buyer hereby subscribes for up to 3,000 shares of Preferred at
a value of $1,000.00 per each share of Preferred for an aggregate
amount of $3,000,000.00USD which Preferred shall contain such
terms, provisions, and conditions pursuant to the Certificate of
Designation attached as Exhibit A to and forming an integral part
of this Agreement. The Buyer shall pay to the Company
$3,000,000.00 for 3,000 shares of Preferred on the date the
Preferred is duly executed by the Company and received in escrow by
the Buyer's counsel (the "Closing Date").
(iii) The Company shall grant to the Buyer the following
Warrants ("Warrants") to purchase up to an aggregate of 150,000
Shares of the Company, with each Warrant entitling the Buyer to
purchase one Share at a warrant exercise price of Two Dollars and
50/100 ($2.50) per Share expiring three (3) years after the Closing
Date and Warrants to purchase up to an aggregate of 200,000 shares
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of the Company with each Warrant entitling the Buyer to purchase
one Share at a warrant exercise price of One Dollar and 875/1000
($1.875) per Share expiring three (3) years after the Closing Date;
(a) On the Closing Date and upon receipt by the Company of the
Three Million and No/100 Dollars ($3,000,000) for the 3,000 Shares
of Preferred, the Company shall issue to the Buyer a Warrant to
purchase up to One Hundred and Fifty Thousand (150,000) Shares at
an exercise price of Two Dollars and 50/100 ($2.50) per Share, and,
the Company shall issue to the Buyer a Warrant to purchase up to
Two Hundred Thousand (200,000) Shares at an exercise price of One
Dollar and 875/1000 ($1.875) per Share with the term of each
Warrant being for a period of three (3) years from the Closing
date; and
Each Warrant shall be substantially in the form attached hereto as
Exhibit B.
2. BUYER'S REPRESENTATIONS, COVENANTS:
Buyer represents, warrants and covenants as follows:
(i) Authorization: Such Buyer has full power and authority to
enter into this Agreement, the Preferred and the Warrant
(collectively, the "Transaction Documents") and that the
Transaction Documents, when executed and delivered will constitute
a valid and legally binding obligation of Buyer in accordance with
their terms, subject to (A) bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and similar laws now or
hereafter in effect relation to creditors' rights and (B) that the
remedy of specific performance and injunctive and other forms of
equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceedings therefor may
be brought.
(ii) Purchase Entirely for Own Account: This Agreement is made by
the Buyer in reliance upon Buyer's representation to the Company,
which by such Buyer's execution of this Agreement Buyer hereby
confirms, that the Preferred and Warrants to be purchased by the
Buyer and the Shares issuable upon conversion and exercise thereof,
(collectively, the "Securities") will be acquired for investment
for Buyer's own account, and not with a view to resale or
distribution of any part thereof. By execution of this Agreement,
Buyer further represents that Buyer does not have any contract,
undertaking, agreement or arrangement with any person, to sell,
transfer or grant participation to such person or to any third
person, with respect to any of the Securities
(iii) Buyer is not a corporation, syndicate, partnership or
other form unincorporated entity or corporation created solely to
permit the purchase of the Securities, and Buyer is not purchasing
the Securities as a result of an advertisement or general
solicitation of the Securities, including an advertisement in
printed media of general and regular paid circulation, radio or
television.
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(iv) The Buyer represents that it is an Accredited Investor as
defined in Regulation D.
(v) Buyer understands that the Securities may not be sold,
transferred or otherwise disposed of without registration under the
Act or an exemption therefrom.
(vi) Buyer acknowledges that no person has made to Buyer any
written or oral representations:
(1) that any person will resell or repurchase the
Securities;
(2) that any person will refund the purchase price of
the Securities; and
(3) as to the future price or value of the Securities.
(vii) Buyer, either alone or together with its representatives,
has such knowledge, sophistication and experience in business and
financial matters so as to be capable of evaluating the merits and
risks of the prospective investment in the Securities, and has so
evaluated the merits and risks of such investment. The Buyer has
been advised that the Company has not retained any independent
professionals to review or comment or otherwise protect the
interests of the Buyer. Although the Company has retained its own
counsel, neither the Company's counsel nor William S. Hechter,
Esq., has acted on behalf of the Buyer and the Buyer should not
rely on the Company's legal counsel or William S. Hechter, Esq.,
with respect to the transactions herein described;
(viii) Buyer is able to bear the economic risk of an investment
in the Securities and, at the present time, is able to afford a
complete loss of such investment; and
(ix) Buyer acknowledges that it has (i) received copies of the
Company's Form 10-K for the year ended December 31, 1997, Form 10-Q
for the quarter ended March 31, 1998, and proxy soliciting material
for the Company's 1998 annual meeting of shareholders (collectively
the "Commission Filings") and (ii) been afforded (1) the
opportunity to ask such questions as it has deemed necessary of,
and to receive answers from, representatives of the Company
concerning the terms and conditions of the offering of the
Securities and the merits and risks of investing in the Securities;
(2) access to information about the Company and the Company's
financial condition, results of operations, business, properties,
management and prospects sufficient to enable it to evaluate its
investment in the Securities; and (3) the opportunity to obtain
such additional information which the Company possesses or can
acquire without unreasonable effort or expense that is necessary to
make an informed investment decision with respect to the Securities
and to verify the accuracy and completeness of the information as
requested.
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(x) Neither the Buyer nor its affiliates will sell the Company's
Shares short.
(xi) Certain Risk. In addition to the risks described in the
Commission Filings, the Buyer recognizes that the purchase of the
Preferred and Warrants involves a high degree of risk, in that (a)
the Company has sustained losses every year since its inception,
including the first quarter of 1998, from its operations, and may
require substantial funds in addition to the proceeds of this
private placement; (b) that the Company has a substantial
accumulated deficit; (c) an investment in the Company is highly
speculative and only investors who can afford the loss of their
entire investment should consider investing in the Company and the
Preferred and Warrants; (d) an investor may not be able to
liquidate his investment; (e) transferability of the Preferred and
Warrants is extremely limited; (f) in the event of a disposition an
investor could sustain the loss of his entire investment; (g) the
Preferred and Warrants represent non-voting equity securities in a
corporate entity that has an accumulated deficit; (h) no return on
investment, whether through distributions, appreciation,
transferability or otherwise, and no performance by, through or of
the Company, has been promised, assured, represented or warranted
by the Company, or by any director, officer, employee, agent or
representative thereof; and (i) while the Shares are presently
quoted and traded on the Boston Stock Exchange ("BSE") and the
Nasdaq SmallCap Market ("NASDAQ") and while the Buyer is the
beneficial owner of other series of convertible preferred stock and
is beneficiary of certain registration rights provided herein, the
Securities subscribed for and that are purchased under this
Agreement, the Shares to be received upon conversion of the
Preferred, and the Shares to be acquired upon exercise of the
Warrants (i) are not registered under applicable federal (U.S.) or
state securities laws, and thus may not be sold, conveyed, assigned
or transferred unless registered under such laws or unless an
exemption from registration is available under such laws, as more
fully described herein, and (ii) the Preferred and Warrants
subscribed for and that are to be purchased under this Agreement
are not quoted, traded or listed for trading or quotation on the
NASDAQ, or any other organized market or quotation system, and
there is therefore no present public or other market for the
Preferred and the Warrants nor can there by any assurance that the
Common Stock of the Company will continue to be quoted, traded or
listed for trading or quotation on the Boston Stock Exchange of the
NASDAQ or on any other organized market or quotation system.
(xii) No Review by the SEC. The Buyer hereby acknowledges that
this offering has not been reviewed by the SEC because this private
placement is intended to be a nonpublic offering pursuant to
Section 4(2) of the Act and/or Regulation D promulgated under the
Act.
(xiii) No Public Market. The Buyer understands that there is no
public market for the Preferred or the Warrants. The Buyer
understands that although there is presently a public market for
the Shares, including the Shares issuable upon conversion of the
Preferred or exercise of the Warrants, Rule 144 (the "Rule")
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promulgated under the Act requires, among other conditions, a one
year holding period following full payment of the consideration
therefor prior to the resale (in limited amounts) of securities
acquired in a nonpublic offering without having to satisfy the
registration requirements under the Act. The Buyer understands and
hereby acknowledges that the Company shall register the Shares
under the Act, pursuant to the terms in Section 10 hereof.
(xiv) Survival. The Buyer expressly acknowledges and agrees that
all representations, warranties, agreements and covenants set forth
in this Agreement shall be of the essence hereof and shall survive
the execution, delivery and closing of this Agreement, the sale and
purchase of the Preferred and Warrants, the conversion of the
Preferred, exercise of the Warrants and the sale of the "Shares".
3. SELLER'S REPRESENTATIONS:
Seller represents and warrants as follows, except as otherwise
disclosed in the Company's Commission Filings:
(i) 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 carry on its
material business as now conducted and as currently proposed to be
conducted. The Company is duly qualified to transact business and
is in good standing in each jurisdiction in which the failure to so
qualify would have a material adverse effect on the business or the
properties of the Company and its subsidiaries taken as a whole.
The Company is not the subject of any pending or, to its knowledge,
threatened or contemplated investigation or administrative or legal
proceedings by the Internal Revenue Service, the taxing authorities
of any State of local jurisdiction, or the Commission, or any State
Securities Commission, or any other governmental entity which could
have a material adverse effect in the Company and its subsidiaries
taken as a whole.
(ii) Seller has not conducted any general solicitation or general
advertising (as defined in Regulation D) with respect to any of the
Securities offered hereby;
(iii) The Preferred, when issued and delivered pursuant to the
terms of this Agreement, will have been duly authorized, executed,
issued and delivered and will constitute valid and legally binding
obligations of the Company in accordance with their terms, subject
to (A) bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and similar laws now or hereafter in
effect relating to creditors' rights and (B) that the remedy of
specific performance and injunctive and other forms of equitable
relief may be subject to equitable defenses and to the discretion
of the court before which any proceedings therefore may be brought.
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(iv) The Shares, when issued and delivered upon conversion of the
Preferred, and exercise of the Warrants, in accordance with their
terms and the terms of this Agreement, will be duly and validly
authorized and issued fully paid and non- assessable and will not
subject the holders thereof to personal liability by reason of
being such holders. There are no preemptive rights of any
shareholder or Seller with respect to the Shares contained in
Seller's Certificate of Incorporation or any agreement to which
Seller is a party.
(v) This Agreement has been duly authorized, validly executed and
delivered on behalf of Seller and is a valid and binding agreement
of Seller in accordance with its terms and subject to (A)
bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and similar laws new or hereafter in effect relating to
creditors' rights and (B) that the remedy of specific performance
and injunctive and other forms of equitable relief may be subject
to equitable deficiencies and to the discretion of the court before
which any proceedings thereafter may be brought.
(vi) The execution and delivery of this Agreement and the
consummation of the transactions contemplated by this Agreement do
not and will not conflict with or result in a breach by Seller of
any of the terms or provisions of, or constitute default under, the
certificate of incorporation (or charter) or by-laws of Seller, any
indenture, mortgage, deed of trust or other material agreement or
instrument to which Seller is a party or by which it or any of its
proprietors or agents are bound, or any existing applicable decree,
judgment or order of any court, federal or state regulatory body,
administrative agency or governmental body having jurisdiction over
Seller or any of it properties or assets the effect of which would
have a material adverse effect on the Company and its subsidiaries
taken as a whole;
(vii) No authorization, approval or consent of or filing with
any federal, state or local governmental body of the United States
is legally required for the issuance and sale of the Preferred and
(provided no commission or other remuneration is paid or given
directly or indirectly by Seller for soliciting such conversion)
the issuance of the Shares upon conversion of the Preferred in
accordance with their terms, as contemplated by this Agreement;
except the filing of a Form D with the Commission, the listing of
the Shares with the BSE and the NASDAQ, and the filing of the
Certificate of Designation with the Delaware Secretary of State;
(viii) To the best of the Company's knowledge, the information
contained in the Company's quarterly reports on Form 10-Q for the
quarter ended March 31, 1998 and annual report on Form 10-K for
the year ended December 31, 1997 ("Reports"), as filed with the
Commission do not contain any untrue statement of material fact or
omit any material fact necessary in order to make the statements
therein, and in the light of the circumstances under which they are
made are not misleading. Since March 31, 1998, there has been no
material adverse development in the business, properties,
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operations, financial condition or results of operations of Seller
except as disclosed in the Reports.
(ix) Seller will issue one or more certificates representing the
Preferred in the name of Buyer that are purchased by the Buyer
pursuant to the terms hereof, in such denominations to be specified
by Buyer prior to closing and will issue one or more certificates
representing the Shares in such denominations to be specified by
the Buyer upon conversion of the Preferred. Seller further
warrants that the Preferred and the Shares shall be transferable
by the Buyer on the books and records of Seller as and to the
extent provided in the Transaction Documents, subject to compliance
with Federal and State securities laws.
(x) Within twenty (20) days of the Closing Date the Company shall
secure the listing of the Shares issuable on conversion of the
3,000 shares of Preferred purchased by the Buyer under Section
1(ii) and exercise of the Warrants issued to the Buyer hereunder
("Warrant Shares") upon the Nasdaq SmallCap Market or such national
securities exchange or automated quotation system, if any, upon
which Shares are then listed (subject to official notice of
issuance) and shall maintain such listing of all Shares and Warrant
Shares from time to time issuable upon conversion or exercise of
the Preferred purchased by the Buyer hereunder and the Warrants
issued to the Buyer hereunder. The Company will obtain and
maintain the listing and trading of its Shares on the Nasdaq
SmallCap Market or other national securities exchange or automated
quotation system and will comply in all respects with the Company's
reporting, filing and other obligations under the bylaws or rules
of the Nasdaq SmallCap Market or such exchanges, as applicable.
The Company shall promptly provide to the Buyer copies of any
notices it receives regarding the continued eligibility of the
Shares for listing on the Nasdaq SmallCap Market or other principal
exchange or quotation system on which the Shares are then listed or
traded.
(xi) So long as a Buyer beneficially owns any Preferred or
Warrants, the Company shall maintain its corporate existence in
good standing under the laws of the jurisdiction in which it is
incorporated and, prior to the registration statement referred to
in Section 10(a) hereof being declared effective by the Commission,
the Company shall not sell all or substantially all of the
Company's assets, except in the event of a sale of all or
substantially all of the Company's assets where the holders of such
outstanding Preferred shall have the right to convert such
Preferred, then outstanding, into the kind and amount of shares of
stock or other securities and properly receivable upon such sale by
a holder of the number of Shares into which such shares of
Preferred, then outstanding, could have been converted into
immediately prior to such sale.
(xii) The Company has conducted, and shall conduct its business in
compliance with all applicable laws, rules and regulations of the
jurisdictions in which it is conducting business (including without
limitation, all applicable local, state and federal environmental
laws and regulations), except where the failure to comply with such
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<PAGE>
laws, rules or regulations would not have a material adverse effect
on the Company and its subsidiaries taken as a whole.
(xii) The Company and each of its subsidiaries maintain a
system of internal accounting controls sufficient to provide
reasonable assurance that (i) transactions are executed in
accordance with management's general and specific authorizations;
(ii) transactions are recorded as necessary to permit preparation
of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability; (iii)
access to assets is permitted only in accordance with management's
general or specific authorization and; (iv) the recorded
accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect
to any differences.
(xiv) The Company has maintained, and shall maintain liability,
casualty and other insurance with responsible insurance companies
against such risk of the types and in the amounts customarily
maintained by companies of comparable size, and business to the
Company.
(xv) The Company understands and acknowledges that the number of
Conversion Shares issuable upon conversion of the Preferred will
increase in certain circumstances. The Company further
acknowledges that its obligation to issue Conversion Shares upon
conversion of the Preferred in accordance with this Agreement and
the Certificate of Designations, Exhibit A, is absolute and
unconditional regardless of the dilutive effect that such issuance
may have on the ownership interests of other stockholders of the
Company.
(xvi) As of May 11, 1998, the Company has presently authorized
50,000,000 Shares of which 12,001,746 Shares are outstanding.
(xvii) Except as disclosed in the Commission Filings, the
Company is not involved in any litigation which if determined
adversely to the Company, would have a material adverse effect upon
the Company's and its subsidiaries taken as a whole.
4. USE OF PROCEEDS:
As of the date hereof, the Company expects to use the proceeds from
the issuance of the Preferred for working capital and/or to reduce
the outstanding balance of its credit facilities, subject to the
Company reborrowing under such credit facilities.
8
<PAGE>
5. RESERVATION OF SHARES:
The Company shall, at all times, reserve and have available all
Shares (Conversion Shares) necessary to convert the entire amount
of Preferred then outstanding, and to effect the exercise of the
Warrants.
The Company shall take all action necessary to at all times have
authorized, and reserved for the purpose of issuance, all Shares
needed to provide for the issuance of the Conversion Shares and
Shares issuable upon exercise of the Warrants. If 2,200,000 Shares
is insufficient to effect conversion of the entire amount of
Preferred then outstanding and the Shares issuable upon exercise of
the Warrants, the Company shall forthwith have authorized for the
purpose of issuance sufficient additional Shares to effect
conversion and exercise of the Warrants.
6. INSTRUCTIONS TO TRANSFER AGENT
Upon the registration statement described in Section 10(a) being
declared effective by the Commission, the Company shall, forthwith,
issue instructions to its transfer agent to the effect that on the
date the registration statement registering the Shares underlying
the Preferred and Warrants is declared effective by the Commission,
to issue, upon receipt by the Company of a Conversion Notice from
the Buyer, the required number of Shares, subject to the Conversion
Notice, provided that the number of Shares that the Transfer Agent
shall be authorized to issue to the Buyer shall not exceed the
number of Shares underlying the Preferred and Warrants that are
covered by such registration statement and provided further that
the registration statement covering such Shares is effective on the
date of receipt of the Conversion Notice from the Buyer.
7. CLOSING:
Preferred shall be delivered to Buyer and the funds therefor shall
be delivered to Seller on this 30th day of June, 1998 (the
"Closing"), or at such time to be mutually agreed.
Seller shall execute the appropriate copies of the Transaction
Documents (the "Seller's Closing Documents") and deliver the
executed documents to Hechter and Associates, counsel for Buyer,
with instructions to hold the documents in trust and not to release
the documents to Buyer until advised to do so by Seller or Seller's
counsel. Buyer shall execute the appropriate copies of the
Transactions Documents (the "Buyer's Closing Documents") and
deliver the executed documents to Conner & Winters, counsel for
Seller, with instructions to hold the documents in trust and not to
release the documents to Seller until advised to do so by Buyer or
Buyer's counsel.
Immediately after Buyer's counsel has received the Seller's Closing
Documents executed by Seller, then Buyer shall pay to Seller the
principal amount of the Preferred for which Buyer subscribed and
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<PAGE>
purchased (the "Purchase Price") as set forth in Section 1(ii)
hereof. Buyer shall pay to Seller the Purchase Price, less all
legal fees and expenses (not to exceed an aggregate of $22,000) and
commissions (not to exceed 71/2% of that portion of the Purchase
Price to be paid to Seller) by wire transfer of immediately
available funds in accordance with the following instructions:
Bank
Name: Suntrust/North Central Florida
ABA #: 063100727
Credit: Perma-Fix Environmental Services, Inc.
Account #: 0050000117164
On the banking day that Seller has confirmed that its counsel has
received the Buyer's Closing Documents and is credited with having
received the Purchase Price (the "Closing Date"), the Seller shall
advise Buyer. Immediately thereafter, and Seller shall advise
Hechter & Associates to release the Seller's Closing Documents to
Buyer and Buyer shall advise Conner & Winters, to release the
Buyer's Closing Documents to Seller. The transaction Documents
shall not be deemed to have been delivered except in accordance
with the procedures described in this Section 7.
If the Closing Date as to the 3,000 shares of Preferred to be
acquired by the Buyer pursuant to Section 1(ii) hereof, does not
occur before July 15, 1998 then either party may terminate this
Agreement immediately upon written notice to the other party and
all Transaction Documents shall be deemed to be null and void.
7a. CONDITIONS TO CLOSING:
The obligation of the Buyer hereunder to purchase the Preferred at
the Closing is subject to the satisfaction, at or before the
Closing Date, of each of the following conditions, provided that
these conditions are for the Buyer's sole benefit and may be waived
by the Buyer at any time in its sole discretion:
a. The Company shall have executed this Agreement and the
Certificate of Designation, and the Preferred, and delivered the
same to the Buyer.
b. The Shares shall be authorized for quotation on the electronic
bulletin board, over-the-counter market, AMEX, the NASDAQ SmallCap
Market or The New York Stock Exchange, Inc., trading in the Shares
shall not have been suspended for any reason.
c. The Company shall request the approval for the issuance of the
Securities from its lender, Congress Financial Corporation. If
said approval is not received in writing within thirty (30) days of
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<PAGE>
the Closing Date, the Company shall forthwith repay the total
amount invested of $3,000,000.00 plus interest calculated at 6%
annually, from the date that the $3,000,000.00 is paid to the
Company until repaid in full.
d. The representations and warranties of the Company shall be
true and correct in all material respects as of the date when made
and as of the Closing Date as though made at that time and the
Company shall have performed, satisfied and complied in all
material respects with the covenants, agreements and conditions
required by this Agreement to be performed, satisfied or complied
with by the Company at or prior to the Closing Date. The Buyer
shall have received a certificate, executed by the Chief Executive
Officer of the Company, dated as of the Closing Date, to the
foregoing effect.
e. The Buyer shall have received the opinion of the Company's
counsel dated as of the Closing Date, in form, scope and substance
reasonably satisfactory to the Buyer.
f. As of the Closing Date, the Company shall have reserved out of
its authorized and unissued Shares, 2,200,000 Shares for which are
issuable upon conversion of the 3,000 shares of Preferred sold to
the Buyer under Section 1(ii) hereof.
8. INDEMNIFICATION:
In consideration of the Buyer's execution and delivery of this
Agreement and acquiring the Preferred and Conversion Shares
hereunder and in addition to all of the Company's other obligations
under this Agreement, the Company shall defend, indemnify and hold
harmless the Buyer and all of its officers, directors, employees
and agents (including, without limitation, those retained in
connection with the transactions contemplated by this Agreement)
(collectively, the "Indemnitees") from and against any and all
actions, causes of action, suits, claims, losses, costs, penalties,
fees, liabilities and damages, and expenses in connection
therewith, and including reasonable attorneys' fees and
disbursements (the "Indemnified Liabilities"), incurred by the
Indemnitees or any of them as a result of, or arising out of, or
relating to (a) any misrepresentation or breach of any
representation or warranty made by the Company in this Agreement
and, (b) any breach of any covenant, agreement or obligation of the
Company contained in this Agreement. To the extent that the
foregoing undertaking by the Company may be unenforceable for any
reason, the Company shall make the maximum contribution to the
payment and satisfaction of each of the Indemnified Liabilities
which is permissible under applicable law.
9. RIGHT OF FIRST REFUSAL:
The Company for a period expiring ninety (90) days after the
Closing Date, hereby grants to the Buyer the right of first offer
to purchase all (or any part) of New Securities (as defined herein)
11
<PAGE>
which the Company may, from time to time, propose to sell and
issue. This right of first offer shall be subject to the following
provisions:
In the event the Company proposes to issue New Securities, it shall
give Buyer written notice of its intention, describing the type of
New Securities, the price and the general terms upon which the
Company proposes to issue the same. Buyer shall have three (3)
days from the date of receipt of any such notice to agree to
purchase such New Securities for the price and upon the general
terms specified in the notice by giving written notice to the
Company and stating therein the quantity of New Securities to be
purchased. The sale of New Securities to Buyer shall be closed
within ten (10) days of Buyer's notice to the Company agreeing to
purchase such New Securities.
In the event the Buyer fails to exercise the right of first offer
with respect to all of the available New Securities proposed to be
sold by the Company within said three (3) day period or in the
event Buyer fails to close within ten (10) days of Buyer's notice
to the Company agreeing to purchase such New Securities, the
Company shall have 30 days thereafter to enter into an agreement
(pursuant to which the sale of New Securities covered thereby shall
be closed, if at all, within 45 days from the date of said
agreement), to sell the New Securities respecting which the Buyer's
option was not exercised, at a price and upon general terms no more
favourable to the purchasers thereof than specified in the
Company's notice to the Buyer.
In the event the Company has not entered into an agreement to sell
the New Securities within said 30 day period (or sold and issued
New Securities in accordance with the foregoing within 45 days from
the date of said agreement), the Company shall not thereafter,
during the period of Right of First Refusal, issue or sell any New
Securities, without first offering such securities to the Buyer in
the manner provided above.
"New Securities" means any securities to be issued pursuant to
Regulation D or S under the Act, except (i) securities issued
pursuant to the acquisition of another business entity or segment
of any such entity by the Company by merger, asset purchase, stock
purchase or otherwise, (ii) any borrowing, direct or indirect, from
financial institutions or other persons by the Company, whether or
not presently authorized, including any type of loan or payment
evidenced by any type of debt instrument, provided such borrowings
do not have any equity features including warrants, options or
other rights to purchase capital stock and are not convertible into
capital stock of the Company (iii) securities issued to employees,
consultants, officers or directors of the Company pursuant to any
stock option, stock purchase or stock bonus plan, agreement or
arrangement, (iv) securities issued to vendors or customers or to
other persons in similar commercial situations with the Company,
(v) securities issued in connection with obtaining lease financing,
whether issued to a lessor, guarantor or other person, (vi)
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<PAGE>
securities issued in connection with any stock split, stock
dividend or recapitalization of the Company, or (vi) securities
issued in connection with corporate partnering transactions.
10. Registration Rights. In order to induce the Buyer to enter
into this Agreement and purchase the Preferred and Warrants, the
Company hereby convenants and agrees to grant to the Buyer the
rights set forth in this Section 10 with respect to the
registration of the Shares.
10a. Registration of Conversion Shares. Subject to the terms of
Section 10 hereof, the Company agrees that within forty-five (45)
days after the Closing Date hereof, it shall prepare and file with
the Commission, a registration statement on Form S-3 and such other
documents, including a prospectus, as may be necessary in the
opinion of counsel for the Company in order to comply with the
provisions of the Act, so as to permit a public offering and sale
by the Buyer of up to 2,200,000 Shares issuable upon conversion of
the 3,000 shares of Preferred to be initially sold to the Buyer
hereunder and issuable as payment of dividends on the Preferred
pursuant to the terms of the Preferred and the 350,000 Shares
issuable upon exercise of the Warrants issued to the Buyer under
Section 1(iii)(a). The Company shall use its reasonable efforts to
cause such registration statement to become effective at the
earliest possible date after filing. In connection with the
offering of such Shares registered pursuant to this Section 10, the
Company shall take such actions as shall be reasonably necessary to
qualify the Shares covered by such registration statement under
such "blue sky" or other state securities laws for offer and sale
as shall be reasonably necessary to permit the public offering and
the sale of Shares covered by such registration statement;
provided, however, that the Company shall not be required (i) to
qualify generally to do business in any jurisdiction where it would
not otherwise be required to qualify but for this subparagraph,
(ii) to subject itself to taxation in any such jurisdiction, or
(iii) to consent to general service of process in any such
jurisdiction. It is expressly agreed that in no event are any
registration rights being granted to the Preferred itself, but only
with respect to the underlying Shares issuable upon conversion of
the Preferred, and exercise of the Warrants.
In the event that the 2,200,000 Shares registered pursuant to this
Section 10(a), are not sufficient to effect conversion of the
outstanding Preferred sold to the Buyer, to pay all dividends, and
to effect the exercise of the Warrants, than the Company shall
within thirty (30) days file with the Commission all necessary
documents to increase the number of Shares in the Company's
registration statement in order to effect conversion of the
outstanding Preferred sold to the Buyer, and to pay all dividends,
and to effect the exercise of all Warrants.
10b. Current Registration Statement. Once effective, the Company
shall use its reasonable efforts to cause any registration
statement filed hereunder to remain current and effective for a
period of two (2) years or until the Shares covered by such
registration statement are sold by the Buyer, whichever is less.
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<PAGE>
The Buyer shall promptly provide all such information and materials
and take all such action as may be required in order to permit the
Company to comply with all applicable requirements of the
Commission and to obtain any desired acceleration of the effective
date of such registration statement.
10c. Penalty. The Company expressly agrees that in the event that
it does not file with the Commission, the registration statement
relative to the Shares referred to in Section 10(a) above within
seventy-five (75) days after the Closing Date, or if the Commission
has not declared the registration statement covering the 2,200,000
Shares referred in Section 10(a) hereof effective within one
hundred and twenty (120) days after the Closing Date (Default), the
Company shall pay to the Buyer in cash for such Default the
penalties of 1.5% per month of the amount paid by the Buyer for the
Preferred under this Agreement prorated, until the registration
statement covering the 2,200,000 Shares is declared effective by
the Commission. The cash penalty shall commence on the 121st day
after the Closing Date.
10d. Other Provisions. In connection with the offering of any
Shares registered pursuant to this Section 10, the Company shall
furnish to the Buyer such number of copies of any final prospectus
as it may reasonably request in order to effect the offering and
sale of the Shares registered pursuant to this Section 10, and the
Company shall (x) furnish to the underwriters (if any), at the
Company's expense, unlegended certificates representing ownership
of the Shares being sold in such denominations as requested and (y)
instruct any transfer agent and registrar of the Shares to release
immediately any stop transfer order, and to remove any restrictive
legend with respect to Shares included in any registration becoming
effective pursuant to this Agreement.
10e. Costs. Subject to the immediately following sentence, the
Company shall in all events pay and be responsible for all fees,
expenses, costs and disbursements associated with the registration
statement relating to the Shares under this Section 10, including
filing fees, fees, costs and disbursements of any counsel,
accountants and other consultants representing the Company in
connection therewith. Notwithstanding anything set forth herein to
the contrary, Buyer shall be responsible for any and all
underwriting discounts and commissions in connection with the sale
of the Shares pursuant hereto and all fees of its legal counsel and
other advisors retained in connection with reviewing any
registration statement.
10f. Successors. The Company will require any successor (whether
direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business, properties,
stock or assets of the Company, to expressly assume and agree to
perform this Section 10 in the same manner and to the same extent
that the Company would be required to perform it if no such
succession had taken place.
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<PAGE>
10g. Indemnification.
i. The Company will indemnify and hold harmless the Buyer,
its directors and officers, and any underwriter (as defined in the
Act) for the Buyer and each person, if any, who controls the Buyer
or such underwriter within the meaning of the Act, from and
against, and will reimburse the Buyer and each such underwriter and
controlling person with respect to, any and all loss, damage,
liability, cost and expense to which such holder or any such
underwriter or controlling person may become subject under the Act
or otherwise, insofar as such losses, damages, liabilities, costs
or expenses are caused by any untrue statement or alleged untrue
statement of any material fact contained in such registration
statement, referred to in Section 10(a) of this Agreement, any
prospectus contained therein or any amendment or supplement
thereto, or arise out of, or are based upon, the omission or
alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in
light of the circumstances in which they were made not misleading;
provided, however, that the Company will not be liable in any such
case to the extent that any such loss, damage, liability, cost or
expense arises out of, or is based upon, any untrue statement or
alleged untrue statement or alleged untrue statement or omission or
alleged omission so made in conformity with information furnished
by the Buyer, such underwriter or such controlling person in
writing specifically for use in the reparation thereof.
ii. The Buyer will indemnify and hold harmless the Company,
its directors and officers, any controlling person and any
underwriter from and against, and will reimburse the Company, its
directors and officers, any controlling person and any underwriter
with respect to, any and all loss, damage, liability, cost or
expenses to which the Company or any controlling person and/or any
underwriter may become subject under the Act or otherwise, insofar
as such losses, damages, liabilities, costs or expenses are caused
by any untrue statement, or alleged untrue statement, any
prospectus, as referred to in Section 10(a) of this Agreement,
contained therein or any amendment or supplement thereto, or arise
out of, or are based upon, the omission or alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading, in each case
to the extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission was so
made in reliance upon, and in strict conformity with, written
information furnished by, or on behalf of, the Buyer specifically
for use in the preparation thereof.
11. Securities Legends and Notices. Buyer represents and warrants
that it has read, considered and understood that the following
legends, substantially in the form and substance set forth below,
shall be placed on all of the certificates representing the
Preferred and Warrants:
(i) NEITHER THIS PREFERRED STOCK NOR ANY SHARES OF COMMON STOCK ISSUABLE
UPON THE CONVERSION OF THIS PREFERRED STOCK HAVE BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR
15
<PAGE>
QUALIFIED UNDER APPLICABLE STATE SECURITIES LAWS. THIS PREFERRED STOCK
AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS PREFERRED STOCK MAY
NOT BE OFFERED, SOLD, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED IN
THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AND QUALIFICATION IN
EFFECT WITH RESPECT THERETO UNDER THE SECURITIES ACT AND UNDER ANY
APPLICABLE STATE SECURITIES LAW OR WITHOUT THE PRIOR WRITTEN CONSENT OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC. AND AN OPINION OF PERMA-FIX
ENVIRONMENTAL SERVICES, INC.'S COUNSEL, OR AN OPINION FROM COUNSEL FOR
THE HOLDER HEREOF, WHICH OPINION IS SATISFACTORY TO THE COMPANY, THAT
SUCH REGISTRATION AND QUALIFICATION IS NOT REQUIRED UNDER APPLICABLE
FEDERAL AND STATE SECURITIES LAWS OR AN EXEMPTION THEREFROM.
NOTWITHSTANDING THE FOREGOING, THE SHARES OF COMMON STOCK ISSUABLE UPON
CONVERSION ARE ALSO SUBJECT TO THE REGISTRATION RIGHTS SET FORTH IN THAT
CERTAIN SUBSCRIPTION AND PURCHASE AGREEMENT BY AND BETWEEN THE HOLDER
HEREOF AND THE COMPANY, A COPY OF WHICH IS ON FILE AT THE COMPANY'S
PRINCIPAL EXECUTIVE OFFICE.
(ii) NEITHER THIS WARRANT NOR ANY SHARES OF COMMON STOCK ISSUABLE UPON
THE EXERCISE OF THIS WARRANT. HAVE BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR QUALIFIED UNDER
APPLICABLE STATE SECURITIES LAWS. THIS WARRANT AND THE COMMON STOCK
ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT BE OFFERED, SOLD, PLEDGED,
HYPOTHECATED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT AND QUALIFICATION IN EFFECT WITH RESPECT THERETO
UNDER THE SECURITIES ACT AND UNDER ANY APPLICABLE STATE SECURITIES LAW
OR WITHOUT THE PRIOR WRITTEN CONSENT OF PERMA-FIX ENVIRONMENTAL SERVICES,
INC. AND AN OPINION OF PERMA-FIX ENVIRONMENTAL SERVICES, INC. 'S
COUNSEL, OR AN OPINION FROM COUNSEL FOR THE HOLDER HEREOF, WHICH OPINION
IS SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION AND QUALIFICATION
IS NOT REQUIRED UNDER APPLICABLE FEDERAL AND STATE SECURITIES LAWS OR AN
EXEMPTION THEREFROM.
NOTWITHSTANDING THE FOREGOING, THE SHARES ISSUABLE UPON EXERCISE ARE
SUBJECT TO THE REGISTRATION RIGHTS SET FORTH IN THAT CERTAIN SUBSCRIPTION
AND PURCHASE AGREEMENT BETWEEN THE HOLDER HEREOF AND THE COMPANY, A COPY
OF WHICH IS ON FILE AT THE COMPANY'S PRINCIPAL EXECUTIVE OFFICE.
12. GOVERNING LAW: INTERPRETATION AN DISPUTES:
This Agreement, and all exhibits attached, shall be governed by and
construed under the laws of the State of Delaware and the laws
applicable therein without regard to its choice of law principles.
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<PAGE>
All disputes shall be determined and litigated in the courts of
Delaware.
Any litigation based thereon, or arising out of, under, or in
connection with, this Agreement shall be brought and maintained
exclusively in the courts of the state of Delaware. The Company
and the Buyer hereby expressly and irrevocably submit to the
jurisdiction of the state and federal Courts of the state of
Delaware for the purpose of any such litigation as set forth above
and irrevocably agrees to be bound by any final judgment rendered
thereby in connection with such litigation. The Company and the
Buyer further irrevocably consents to the service of process by
registered mail, postage prepaid, or by personal service within or
without the State of Delaware. The Company and the Buyer hereby
expressly and irrevocably waive, to the fullest extent permitted by
law, any objection which it may have or hereafter may have to the
laying of venue of any such litigation brought in any such court
referred to above and any claim that any such litigation has been
brought in any inconvenient forum. To the extent that the Company
and the Buyer have or hereafter may acquire any immunity from
jurisdiction of any court or from any legal process (whether
through service or notice, attachment prior to judgment, attachment
in aid of execution or otherwise) with respect to itself or its
property. The Company and the Buyer hereby irrevocably waives such
immunity in respect of its obligations under this agreement and the
other loan documents.
Buyer and the Company hereby knowingly, voluntarily and
intentionally waive any rights they may have to a trial by jury in
respect of any litigation based hereon, or arising out of, under,
or in connection with, this Agreement. The Company and the Buyer
acknowledge and agree that they have received full and sufficient
consideration for this provision and that this provision is a
material inducement for the Company and the Buyer entering into
this agreement.
Any legal action or proceeding in connection with this Agreement or
the performance hereof may be brought in the state and federal
courts located in Delaware, and the parties hereby irrevocably
submit to the non-exclusive jurisdiction of such courts for the
purpose of any such action or proceeding.
13. ENTIRE AGREEMENT:
This Agreement constitutes the entire agreement among the parties
hereof with respect to the subject matter hereof and supersedes any
and all prior contemporaneous representations, warranties,
agreements and understandings in connection therewith. This
Agreement may be amended only by a writing executed by all parties
hereto. This Agreement may be executed in counterparts and the
facsimile transmission of an executed counterpart to this Agreement
shall be effective as an original.
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<PAGE>
15. FULL NAME AND ADDRESS OF BUYER
FOR REGISTRATION PURPOSES:
NAME: RBB Bank Aktiengesellschaft
ADDRESS: Burgring 16
8010 Graz, Austria
TEL. No. 0043-316-8072-354 Fax. No. 0043-316-8072-392
CONTACT
NAME: Herbert Straub, Headtrader
16. DELIVERY INSTRUCTIONS: (if different from
Registration Name):
NAME: _________________________________________
ADDRESS: _________________________________________
_________________________________________
TEL. No.: _________________________________________
FAX No.: _________________________________________
CONTACT
NAME: _________________________________________
SPECIAL
INSTRUCTIONS: _______________________________________
_______________________________________
18
<PAGE>
IN WITNESS WHEREOF, this Agreement was duly executed on the date
first written below
Dated this 30th day of the month of June, 1998.
COMPANY Perma-Fix Environmental Services, Inc.
NAME: 1940 N.W. 67th Place
Gainseville, Florida
BY: Dr. Louis F. Centofanti
TITLE: President
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
BY: /s/ Louis Centofanti
_________________________________________
BUYER: RBB Bank Aktiengesellschaft
ADDRESS: Burgring 16
8010 Graz, Austria
BY: Herbert Straub
TITLE: Headtrader
RBB BANK AKTIENGESELLSCHAFT
BY: /s/ Herbert Straub
___________________________________
17
A:\sub4.1.wpd
State of Delaware
Office of the Secretary of State
________________________________
I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STATE OF DELAWARE,
DO HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE
CERTIFICATE OF DESIGNATION OF "PERMA-FIX ENVIRONMENTAL SERVICES, INC.,"
FILED IN THIS OFFICE OF THE TENTH DAY OF JULY, A.D. 1998, AT 12 O'CLOCK
P.M.
A FILED COPY OF THIS CERTIFICATE HAS BEEN FORWARDED TO THE
NEW CASTLE COUNTY RECORDER OF DEEDS.
/s/ Edward J. Freel
___________________________________
Edward J. Freel, Secretary of State
2249849 8100 AUTHENTICATION: 9189453
981268436 DATE: 07-10-98
<PAGE>
CERTIFICATE OF DESIGNATIONS
OF RIGHTS AND PREFERENCES OF THE
SERIES 10 CLASS J CONVERTIBLE PREFERRED STOCK OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
We, being respectively the President and Secretary of Perma-Fix
Environmental Services, Inc. a corporation organized and existing
under the laws of the State of Delaware (hereinafter the
"Corporation"), DO HEREBY CERTIFY:
FIRST:
That pursuant to authority expressly granted and vested in the
Board of Directors of said Corporation under Section 151 of the
Delaware General Corporation Law (the "GCL"), and the provisions of
the Corporation's Restated Certificate of Incorporation, said Board
of Directors, on June 30th, 1998 (the "Closing Date"), adopted the
following resolution setting forth the designations, powers,
preferences and rights of its Series 10 Class J Convertible
Preferred Stock (the "Certificate of Designations").
RESOLVED: That the designations, powers, preferences and rights of
the Series 10 Class J Convertible Preferred Stock be, and they
hereby are, as set forth below:
1. Number of Shares of Common Stock of Series 10 Class J
Convertible Preferred Stock
The Corporation hereby authorizes the issuance of 3,000 (three
thousand,) shares of Series 10 Class J Convertible Preferred Stock
par value $.001 per share (the "Preferred Stock"). This Preferred
Stock shall pay an annual dividend based on a 365 day calendar year
of 4% of the Liquidation Value (as defined in Section 3 hereof)
("Dividend Rate"), payable semiannually within ten (10) business
days after each subsequent June 30th and December 31st (each a
"Dividend Declaration Date"), and shall be payable in cash or
shares of the Corporation's par value $.001 per share common stock
(Common Stock) at the Corporation's option. The first Dividend
Declaration Date shall be December 31st, 1998.
In the event that the Corporation elects to pay the accrued
dividends due as of a Dividend Declaration Date on the outstanding
shares of Preferred Stock in Common Stock of the Corporation, the
Holder of each share of Preferred Stock shall receive that number
of shares of Common Stock equal to the product of (a) the quotient
of (i) the Dividend Rate divided by (ii) the average of' the
closing bid quotation of the Corporation's Common Stock as reported
on the National Association of Securities Dealers Automated
Quotation system ("NASDAQ"), or if the Common Stock is not listed
for trading on the NASDAQ but is listed for trading on a national
;1
<PAGE>
securities exchange, the average closing bid price of the Common
Stock as quoted on such national exchange, for the five (5) trading
days immediately prior to the Dividend Declaration Date (the "Stock
Dividend Price"), times (b) a fraction, the numerator of which is
the number of days elapsed during the period for which the dividend
is to be paid, and the denominator of which is 365. Dividends on
the Preferred Stock shall be cumulative, and no dividends or other
distributions shall be paid or declared or set aside for payment on
the Corporation's Common Stock until all accrued and unpaid
dividends on all outstanding shares of Preferred Stock shall have
been paid or declared and set aside for payment.
2. Voting.
(a) Except as provided under Section 242 of the GCL, holders of
Preferred Stock (the "Holders") shall not have the right to vote
on any matter. Notwithstanding the provisions of Section 242 of
the GCL or Section 4 hereof, the number of authorized shares of any
class or classes of stock of the Corporation may be increased or
decreased (but not below the number of shares thereof outstanding)
by the affirmative vote of the holders of a majority of the stock
of the Corporation entitled to vote thereon, voting together as a
single class, irrespective of the provisions of Section 242 of the
GCL.
3. Liquidation.
In the event of a voluntary or involuntary dissolution,
liquidation, or winding up of the Corporation, the Holders of
Preferred Stock shall be entitled to receive out of the assets of
the Corporation legally available for distribution to holders of
its capital stock, before any payment or distribution shall be made
to holders of shares of Common Stock or any other class of stock
ranking junior to the Preferred Stock, an amount per share of
Preferred Stock equal to $1,000 (the "Liquidation Value") plus any
accrued and unpaid dividends on the Preferred Stock. If upon such
liquidation, dissolution, or winding up of the Corporation, whether
voluntary or involuntary, the assets to be distributed among the
Holders of Preferred Stock shall be insufficient to permit payment
to the Holders of Preferred Stock of the amount distributable as
aforesaid, then the entire assets of the Corporation to be so
distributed shall be distributed ratably among the Holders of
Preferred Stock and shares of such other classes or series ranking
on a parity with the shares of this Preferred Stock in proportion
to the full distributable amounts for which holders of all such
parity shares are entitled upon such distribution, liquidation, or
winding up. Upon any such liquidation, dissolution or winding up
of the Corporation, after the Holders of Preferred Stock shall
have been paid in full the amounts to which they shall be entitled,
the remaining net assets of the Corporation may be distributed to
the holders of stock ranking on liquidation junior to the Preferred
Stock and the Holders of the Preferred Stock shall have no right or
claim to any of the remaining assets of the Corporation. Written
notice of such liquidation, dissolution or winding up, stating a
payment date, the amount of the liquidation payments and the place
;2
<PAGE>
where said liquidation payments shall be payable, shall be given by
mail, postage prepaid or by telex or facsimile to non-U.S.
residents, not less than 10 days prior to the payment date stated
therein, to the Holders of record of Preferred Stock, such notice
to be addressed to each such Holder at its address as shown by the
records of the Corporation. For purposes hereof the shares of
Common Stock, shall rank on liquidation junior to the Preferred
Stock.
4. Restrictions.
The Corporation will not amend or modify the terms of its Restated
Certificate of Incorporation so as to adversely alter or change the
Preferred Stock at any time when shares of Preferred Stock are
outstanding, without the approval of the Holders of at least a
majority of the then outstanding shares of Preferred Stock given in
writing or by vote at a meeting, consenting or voting (as the case
may be) separately as a series, except where the vote or written
consent of the Holders of a greater number of shares of Common
Stock of the Corporation is required by law or by the Corporation's
Certificate of Incorporation, as amended.
5. Optional Conversion.
The Holders of shares of Preferred Stock shall have the following
conversion rights to convert the shares of Preferred Stock into
shares of Common Stock of the Corporation:
(a) Conversion Dates, The Holder of any share or shares of
Preferred Stock may convert cumulatively any of such Preferred
Stock at any time subsequent to 180 days after the Closing Date.
(b) Right to Convert; Conversion Price. Subject to the terms
hereof, as used herein, the term Conversion Price per outstanding
share of Preferred Stock shall be One Dollar and 875/1000 ($1.875);
except that after the expiration of one hundred and eighty (180)
days after the Closing Date if the average of the closing bid price
per share of Common Stock quoted on the NASDAQ (or the closing bid
price of the Common Stock as quoted on the national securities
exchange if the Common Stock is not listed for trading on the
NASDAQ but is listed for trading on a national securities exchange)
for the five (5) trading days immediately prior to the particular
date of each Conversion Notice (as defined below) is less than Two
Dollars and 34/100 ($2.34), then the Conversion Price for that
particular conversion shall be eighty percent (80%) of the average
of the closing bid price of the Common Stock on the NASDAQ (or if
the Common Stock is not listed for trading on the NASDAQ but is
listed for trading on a national securities exchange then eighty
percent (80%) of the average of the closing bid price of the Common
Stock on the national securities exchange) for the five (5) trading
days immediately prior to the particular date of the Conversion
Notice. If any of the outstanding shares of Preferred Stock are
converted, in whole or in part, into Common Stock pursuant to the
terms of this Section 5(b), the number of shares of whole Common
Stock to be issued to the Holder as a result of such conversion
;3
<PAGE>
shall be determined by dividing (a) the aggregate Stated Value of
the Preferred Stock so surrendered for conversion by (b) the
Conversion Price in effect on the date of that particular
Conversion Notice relating to such conversion. At the time of
conversion of shares of the Preferred Stock, the Corporation shall
pay in cash to the holder thereof an amount equal to all unpaid and
accrued dividends, if any, accrued thereon on the shares of
Preferred so converted to the date of the Conversion Notice
relating to such conversion, or, at the Corporation's option, in
lieu of paying cash for the accrued and unpaid dividends, issue
that number of shares of whole Common Stock which is equal to the
quotient of the amount of such unpaid and accrued dividends to the
date of the Conversion Notice relating to such conversion of the
shares of Preferred Stock so converted divided by the Stock
Dividend Price, in effect at the date of the Conversion Notice
relating to such conversion.
(c) Conversion Notice. The right of conversion shall be exercised
by the Holder thereof by telecopying or faxing an executed and
completed written notice signed by an authorized representative of
the Holder, ("Conversion Notice") to the Corporation that the
Holder elects to convert a specified number of shares of Preferred
Stock representing a specified Stated Value thereof into shares of
Common Stock and by delivering by express courier the certificate
or certificates of Preferred Stock being converted to the
Corporation at its principal office (or such other office or agency
of the Corporation as the Corporation may designate by notice in
writing to the Holders of the Preferred Stock). The business date
indicated on a Conversion Notice which is telecopied to and
received by the Corporation in accordance with the provisions
hereof shall be deemed a Conversion Date. The Conversion Notice
shall include therein the Stated Value of shares of Preferred Stock
to be converted, and a calculation (a) of the Stock Dividend Price,
(b) the Conversion Price, and (c) the number of Shares of Common
Stock to be issued in connection with such conversion. The
Corporation shall have the right to review the calculations
included in the Conversion Notice, and shall provide notice of any
discrepancy or dispute therewith within three (3) business days of
the receipt thereof. The Holder shall deliver to the Corporation
an original Conversion Notice and the original Preferred to be
converted within three (3) business days from the date of the
Conversion Notice.
(d) Issuance of Certificates - Time Conversion Effected.
Promptly, but in no event more than six (6) business days, after
the receipt by facsimile of the Conversion Notice referred to in
Subparagraph (5)(c); and provided within the six (6) business days
the Corporation receives the certificate or certificates for the
shares of Preferred Stock to be converted, the Corporation shall
issue and deliver, or cause to be issued and delivered, to the
Holder, registered in the name of the Holder, a certificate or
certificates for the number of whole shares of Common Stock into
which such shares of Preferred Stock are converted. Such
conversion shall be deemed to have been effected as of the close of
business on the date on which the telecopy or facsimile Conversion
Notice shall have been received by the Corporation, and the rights
of the Holder of such share or shares of Preferred Stock shall
cease, at such time, and the Holder or Holders shall be deemed to
have become the Holder or Holders of record of the shares of Common
Stock represented thereby.
;4
<PAGE>
In the event that the shares of Common Stock issuable upon
conversion of the Preferred, is not delivered within six (6)
business days of the date the Company receives the Conversion
Notice, the Company shall pay to the Buyer, by wire transfer, as
liquidated damages for such failure and not as a penalty, for each
$100,000 of Preferred sought to be converted, $500 for each of the
first five (5) calendar days and $1,000 per calendar day thereafter
that the shares of Common Stock are not delivered, which liquidated
damages shall begin to run from the seventh (7th) business day
after the Conversion Date. Any and all payments required pursuant
to this paragraph shall be payable only in cash. Notwithstanding
the above, liquidated damages shall not exceed $2,000.00 per day.
In addition to the liquidated damages set forth herein, in the
event the Company fails to deliver the shares of Common Stock
within six (6) business days after the Conversion date, the Company
agrees to issue the larger number of shares of Common Stock derived
from (i) the original Conversion Notice, or (ii) utilizing the five
lowest closing bid prices of the Company's shares of Common Stock
beginning on the Conversion Date and ending on the day the shares
of Common Stock are delivered. The Company understands that a
delay in the issuance of the shares of Common Stock could result in
economic loss to the Holder. Nothing contained herein, or in the
Preferred shall limit the Holder's rights to pursue actual damages
for the Company's failure to issue and deliver shares of Common
Stock to the Holder in accordance with the terms of the Certificate
of Designations, and this Agreement.
(e) Fractional Shares of Common Stock. No fractional shares of
Common Stock shall be issued upon conversion of any Preferred Stock
into shares of Common Stock. All fractional shares of Common Stock
shall be aggregated and then rounded down to the nearest whole
share of Common Stock. In case the number of shares of Preferred
Stock represented by the certificate or certificates surrendered
pursuant to Subparagraph 5(b) exceeds the number of shares of
Common Stock converted, the Corporation shall, upon such
conversion, execute and deliver to the Holder, at the expense of
the Corporation, a new certificate or certificates for the number
of shares of Preferred Stock represented by the certificate or
certificates surrendered which are not to be converted.
(f) Merger or Consolidation. In case of either (a) any merger or
consolidation to which the Corporation is a party (collectively,
the "Merger"), other than a Merger in which the Corporation is the
surviving or continuing corporation, or (b) any sale or conveyance
to another corporation of all, or substantially all, of the assets
of the Corporation (collectively, the "Sale"), and such Merger or
Sale becomes effective (x) while any shares of Preferred Stock are
outstanding and prior to the date that the Corporation's
Registration Statement covering all the shares of Common Stock
issuable upon the conversion of the Preferred Stock is declared
effective by the U.S. Securities and Exchange Commission
("Commission"), the Corporation or such successor corporation as
the case may be, shall make appropriate provision so that the
Holder of each share of Preferred Stock then outstanding shall have
the right to convert such share of Preferred Stock into the kind
and amount of shares of stock or other securities and property
receivable upon such Merger or Sale by a holder of the number of
shares of Common Stock into which such shares of Preferred Stock
could have been converted into immediately prior to such Merger or
;5
<PAGE>
Sale, subject to adjustments which shall be as nearly equivalent as
may be practicable to the adjustments provided for in this Section
5.
In the event of a Merger or Sale, where the Corporation is not the
surviving Corporation, the Holder shall have the right to redeem
all of the outstanding shares of Preferred Stock at 120% of the
Liquidation Value of each share of Preferred Stock then outstanding
plus all accrued and unpaid dividends (the "Redemption Amount").
The Corporation shall pay this Redemption Amount in cash within ten
(10) business days of receipt by the Corporation of notice from the
Holder, and receipt by the Corporation of all outstanding shares of
Preferred Stock duly endorsed by the Holder to the Corporation.
(g) Adjustments to Conversion Price for Stock Dividends and for
Combinations or Subdivisions of Common Stock. If the Corporation
at any time or from time to time while shares of Preferred Stock
are issued and outstanding shall declare or pay, any dividend on
the Common Stock payable in Common Stock, or shall effect a
subdivision of the outstanding shares of Common Stock into a
greater number of shares of Common Stock (by stock split,
reclassification or otherwise than by payment of a dividend in
Common Stock), or if the outstanding shares of Common Stock shall
be combined or consolidated, by reclassification or otherwise, into
a lesser number of shares of Common Stock, then the Conversion
Price in effect immediately before such event shall, concurrently
with the effectiveness of such event, be proportionately decreased
or increased, as appropriate.
(h) Adjustments for Reclassification and Reorganization. If
the Common Stock issuable upon conversion of the Preferred Stock
shall be changed into the same or a different number of shares of
Common Stock of any other class or classes of stock, whether by
capital reorganization, reclassification or otherwise (other than
a subdivision or combination or shares of Common Stock provided for
in Section 5(g) hereof), the Conversion Price then in effect shall,
concurrently with the effectiveness of such reorganization or
reclassification, be proportionately adjusted so that the Preferred
Stock shall be convertible into, in lieu of the number of shares of
Common Stock which the holders of Preferred Stock would otherwise
have been entitled to receive, a number of shares of Common Stock
of such other class or classes of stock equivalent to the number of
shares of Common Stock that would have been subject to receipt by
the holders upon conversion of the Preferred Stock immediately
before that change.
6. Assignment.
Subject to all applicable restrictions on transfer, the rights
and obligations of the Corporation and the Holder of the
Preferred Stock shall be binding upon and benefit the successors,
assigns, heirs, administrators, and transferees of the parties.
;6
<PAGE>
7. Shares of Common Stock to be Reserved.
The Corporation, upon the effective date of this Certificate of
Designations, has a sufficient number of shares of Common Stock
available to reserve for issuance upon the conversion of all
outstanding shares of Preferred Stock, pursuant to the terms and
conditions set forth in Section 5, and exercise of the Warrants as
defined in Section 11. The Corporation will at all times reserve
and keep available out of its authorized shares of Common Stock,
solely for the purpose of issuance upon the conversion of Preferred
Stock, and exercise of the Warrants, as herein provided, such
number of shares of Common Stock as shall then be issuable upon the
conversion of all outstanding shares of Preferred Stock, and
exercise of the Warrants. The Corporation covenants that all
shares of Common Stock which shall be so issued shall be duly and
validly issued, fully paid and non assessable. The Corporation
will take such action as may be required, if the total number of
shares of Common Stock issued and issuable after such action upon
conversion of the Preferred Stock, and exercise of the Warrants
would exceed the total number of shares of Common Stock then
authorized by the Corporation's Certificate of Incorporation, as
amended, or would exceed 19.99% of the shares of Common Stock then
outstanding if required by law or the Rules and Regulations of
NASDAQ or the National Securities Exchange applicable to the
Corporation to take such action as a result of exceeding such
19.99%, in order to increase the number of shares of Common Stock
to permit the Corporation to issue the number of shares of Common
Stock required to effect conversion of the Preferred, and exercise
of the Warrants, to a number sufficient to permit conversion of the
Preferred Stock, and exercise of the Warrants, including, without
limitation, engaging in reasonable efforts to obtain the requisite
stockholder approval of any necessary amendment to the
Corporation's Restated Certificate of Incorporation, and to obtain
shareholders approval in order to effect conversion of the
Preferred Stock, and exercise of the Warrants, if required by law
or the rules or regulations of the NASDAQ or National Securities
Exchange applicable to the Corporation.
7(a) Shareholder Approval. In connection with the issuance to the
Holder of the shares of Preferred Stock, pursuant to this
Certificate of Designations, the Corporation is also issuing (i)
certain warrants ("RBB Warrants") to the Holder pursuant to the
terms of that certain Private Securities Subscription Agreement
dated June 30th, 1998 (the "Agreement"), providing for the purchase
of up to 150,000 shares of Common Stock at an exercise price of
$2.50 per share and (ii) certain warrants (collectively, the
"Liviakis Warrants") to Liviakis Financial Communication, Inc.
("Liviakis") and Robert B. Prag providing for the purchase of up to
an aggregate of 2,500,000 shares of Common Stock at an exercise
price of $1.875 per share pursuant to the terms of that Placement
and Consulting Agreement dated June 30th, 1998, between Liviakis
and the Corporation.
If (i) the aggregate number of shares of Common Stock issued by the
Corporation as a result of any or all of the following: (a)
conversion of the Preferred Stock, (b) payment of dividends accrued
on the Preferred Stock (c) exercise of the RBB Warrants, and (d)
exercise of the Liviakis Warrants exceeds 2,388,347 shares of
Common Stock (which equals 19.9% of the outstanding shares of
;7
<PAGE>
Common Stock of the Corporation as of the date of this Certificate
of Designations) and (ii) the Holder has converted or elects to
convert any of the then outstanding shares of Preferred Stock
pursuant to the terms of this Section 5 at a Conversion Price less
than $1.875 ($1.875 the market value per share of Common Stock as
quoted on the NASDAQ as of the close of business on June 30th,
1998) pursuant to the terms of Section 5(b) hereof, other than if
the Conversion Price is less than $1.875 solely as a result of the
anti-dilution provisions of Section 5(g) and (h) hereof, then,
notwithstanding anything in Section 5 to the contrary, the
Corporation shall not issue any shares of Common Stock as a result
of receipt of a Conversion Notice unless and until the Corporation
shall have obtained approval of its shareholders entitled to vote
on the transactions in accordance with subparagraphs (25)(H)(i)d,
(iv) and (v) of Rule 4310 of the NASDAQ Marketplace Rules
("Shareholder Approval").
If Shareholder Approval is required as set forth in the above
paragraph, the Corporation shall take all necessary steps to obtain
such Shareholder Approval upon receipt of the Conversion Notice
triggering the need for Shareholder Approval ("Current Conversion
Notice"). If the Corporation has not received from the Holder a
Current Conversion Notice, the Holder, subsequent to January 1st,
1999 may, if the Corporation's shares of Common Stock trade,
subsequent to January 1st, 1999, at a five (5) day average closing
bid price below Two Dollars and 34/00 ($2.34), upon written notice
to the Corporation, require the Corporation to obtain Shareholder
Approval ("Holder's Notice"). The Holder and the Corporation's
officers and directors covenant to vote all shares of Common Stock
over which they have voting control in favour of Shareholder
Approval. If the Corporation does not obtain Shareholder Approval
within ninety (90) days of the earlier of the Corporation's receipt
of (i) the Current Conversion Notice or (ii) the Holder's Notice,
and the Holder has not breached its covenant to vote all shares of
Common Stock over which they have voting control in favour of
Shareholder Approval, the Corporation shall pay in cash to the
Holder liquidated damages, in an amount of 4% per month of the
Liquidation Value of each share of Preferred Stock then
outstanding, commencing on the 91st day of the Corporation's
receipt of the Holder's Current Conversion Notice, and continuing
every thirty (30) days pro-rata until such time the Corporation
receives Shareholder Approval.
8. No Reissuance of Series 10 Class J Convertible Preferred
Stock.
Shares of Preferred Stock which are converted into shares of Common
Stock as provided herein shall be retired and shall become
authorized but unissued shares of Preferred Stock, which may be
reissued as part of a new series of Preferred stock hereafter
created.
9. Closing of Books.
The Corporation will at no time close its transfer books against
the transfer of any Preferred Stock or of any shares of Common
Stock issued or issuable upon the conversion of any shares of
;8
<PAGE>
Common Stock of Preferred Stock in any manner which interferes with
the timely conversion of such Preferred Stock, except as may
otherwise be required to comply with applicable securities laws.
10. No Preemptive Rights.
The Preferred Stock shall not give its holders any preemptive
rights to acquire any other securities issued by the Corporation
at any time in the future.
11. Definition of Shares.
As used in this Certificate of Designations, the term "shares of
Common Stock" shall mean and include the Corporation's authorized
common stock, par value $.001, as constituted on the date of filing
of these terms of the Preferred Stock, or in case of any
reorganization, reclassification, or stock split of the outstanding
shares of Common Stock thereof, the stock, securities or assets
provided for hereof. The term "Warrants" as used herein shall have
the same meaning as defined in Section 1 of the Private Securities
Subscription Agreement, dated June 30th 1998, between the Company
and RBB Bank Aktiengesellschaft.
The said determination of the designations, preferences and
relative, participating, optional or other rights, and the
qualifications, limitations or restrictions thereof, relating to
the Preferred Stock was duly made by the Board of Directors
pursuant to the provisions of the Corporation's Restated
Certificate of Incorporation and in accordance with the provisions
of the Delaware General Corporation Law.
IN WITNESS HEREOF, this Certificate of Designations has been
signed by:
Dr. Louis F. Centofanti, President on this 30th day of June,
1998.
/s/ Louis Centofanti
__________________________________________________
President, Perma-Fix Environmental Services, Inc.
Richard Kelecy, Secretary on this 30th day of June, 1998
/s/ Richard T. Kelecy
_________________________________________________
Secretary, Perma-Fix Environmental Services, Inc.
SEE RESTRICTIVE LEGEND ON REVERSE SIDE
INCORPORATED UNDER THE LAWS OF
DELAWARE
No. **** Shares ****
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
SERIES 10 CLASS J CONVERTIBLE PREFERRED STOCK
Par Value $.001 Per Share
THIS CERTIFICATE CERTIFIES THAT -- S P E C I M E N -- is the owner of ****
*************** (******) shares of Series 10 Class J Convertible
Preferred Stock***************** of
Perma-Fix Environmental Services, Inc.
transferable only on the books of the Corporation by the holder hereof
in person or by Attorney upon surrender of this Certificate
properly endorsed.
In Witness Whereof, the said Corporation has caused this Certificate
to be signed by its duly authorized officers and to be sealed with
the Seal of the Corporation this ____ day of July, 1998.
_________________________________ ______________________________
Secretary President
SHARES $.001 EACH
<PAGE>
NEITHER THIS PREFERRED STOCK NOR ANY SHARES OF COMMON STOCK
ISSUABLE UPON THE CONVERSION OF THIS PREFERRED STOCK HAVE BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT") OR QUALIFIED UNDER APPLICABLE STATE SECURITIES
LAWS. THIS PREFERRED STOCK AND THE COMMON STOCK ISSUABLE UPON
CONVERSION OF THIS PREFERRED STOCK MAY NOT BE OFFERED, SOLD,
PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED IN THE ABSENCE
OF AN EFFECTIVE REGISTRATION STATEMENT AND QUALIFICATION IN EFFECT
WITH RESPECT THERETO UNDER THE SECURITIES ACT AND UNDER ANY
APPLICABLE STATE SECURITIES LAW OR WITHOUT THE PRIOR WRITTEN CONSENT
OF PERMA-FIX ENVIRONMENTAL SERVICES, INC.'S COUNSEL, OR AN OPINION
FROM COUNSEL FOR THE HOLDER HEREOF, WHICH OPINION IS SATISFACTORY
TO THE COMPANY, THAT SUCH REGISTRATION AND QUALIFICATION IS NOT REQUIRED
UNDER APPLICABLE FEDERAL AND STATE SECURITIES LAWS OR AN EXEMPTION
THEREFROM.
NOTWITHSTANDING THE FOREGOING, THE SHARES OF COMMON STOCK
ISSUABLE UPON CONVERSION ARE ALSO SUBJECT TO THE REGISTRATION
RIGHTS SET FORTH IN THAT CERTAIN PRIVATE SECURITIES SUBSCRIPTION
AGREEMENT BY AND BETWEEN THE HOLDER HEREOF AND THE COMPANY, A COPY
OF WHICH IS ON FILE AT THE COMPANY'S PRINCIPAL EXECUTIVE OFFICE.
CERTIFICATE
FOR
****
SHARES
of the
CAPITAL STOCK
of
Perma-Fix Environmental
Services, Inc.
Series 10 Class J
Convertible Preferred Stock
Par Value $.001 Per Share
ISSUED TO
-- S P E C I M E N --
DATED
July ___, 1998
For Value Received, _____________________ hereby sell, assign, and
transfer unto __________________________________________________________
______________________ Shares of the Capital Stock represented by the
within Certificate, and do hereby irrevocably constitute and appoint
_________________________________ to transfer the said Stock on the
books of the within named Corporation with full power of substitution
in the premises.
Dated ______________________, 19_____.
In the presence of _____________________________________.
THIS WARRANT AND THE SECURITIES TO BE ISSUED UPON ITS EXERCISE HAVE
NOT BEEN REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE
COMMISSION (THE "COMMISSION") OR THE SECURITIES COMMISSION OF ANY
STATE PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SECTION 4(2)
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT")
AND/OR REGULATION D PROMULGATED UNDER THE 1933 ACT. THIS WARRANT
AND THE SECURITIES TO BE ISSUED UPON ITS EXERCISE MAY NOT BE SOLD,
PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED UNLESS REGISTERED
UNDER THE 1933 ACT, OR AN EXEMPTION FROM SUCH REGISTRATION IS
AVAILABLE AND IN THE CASE OF AN EXEMPTION, ONLY IF THE COMPANY HAS
RECEIVED AN OPINION FROM COUNSEL SATISFACTORY TO THE COMPANY THAT
SUCH TRANSACTION DOES NOT REQUIRE REGISTRATION OF THE SECURITIES.
THIS WARRANT SHALL NOT CONSTITUTE AN OFFER TO SELL NOR A
SOLICITATION TO BUY THE WARRANT OR THE SECURITIES TO BE ISSUED UPON
ITS EXERCISE IN ANY JURISDICTION IN WHICH SUCH OFFER OR
SOLICITATION WOULD BE UNLAWFUL.
COMMON STOCK PURCHASE WARRANT
No. 1
TO PURCHASE 150,000 SHARES OF COMMON STOCK OF
PERMA FIX ENVIRONMENTAL SERVICES, INC.
THIS CERTIFIES that, for value received, RBB Bank
Aktiengesellschaft, organized under the laws of Austria and located
in Austria (the "Investor"), is entitled, upon the terms and
subject to the conditions hereinafter set forth, at any time on or
after June 30th, 1998 and on or prior to June 30th, 2001 (the
"Termination Date") but not thereafter, to subscribe for and
purchase from PERMA FIX ENVIRONMENTAL SERVICES, INC., a corporation
incorporated in the State of Delaware (the "Company"), one hundred
and fifty thousand (150,000) shares (the "Warrant Shares") of
Common Stock, $.001 par value per share, of the Company (the
"Common Stock"). The exercise price of one share of Common Stock
(the "Exercise Price") under this Warrant shall be equal to $2.50.
The Exercise Price and the number of shares for which the Warrant
is exercisable shall be subject to adjustment as provided herein.
This Warrant is being issued in connection with the Private
Securities Subscription Agreement dated June 30th, 1998 (the
"Agreement") between the Company and the Investor, and is subject
to its terms and conditions.
1. Title of Warrant. Prior to the expiration hereof and subject
to compliance with applicable laws, this Warrant and all rights
hereunder are transferable, in whole or in part, at the office or
1
<PAGE>
agency of the Company by the holder hereof in person or by duly
authorized attorney, upon surrender of this Warrant together with
the Assignment Form annexed hereto properly endorsed, subject to
the 1933 Act and applicable state securities laws.
2. Authorization of Shares. The Company covenants that all
shares of Common Stock which may be issued upon the exercise of
rights represented by this Warrant will, upon exercise of the
rights represented by this Warrant and full payment of the Exercise
Price multiplied by the number of Warrant Shares to be purchased,
be duly authorized, validly issued, fully paid and nonassessable
and free from all taxes, liens and charges in respect of the issue
thereof (other than taxes in respect of any transfer occurring
contemporaneously with such issue).
3. Exercise of Warrant. (a) Upon presentation and surrender of
this Warrant and the Notice of Exercise Form annexed hereto duly
executed by the Investor, at the office of the Company (or such
other office or agency of the Company as it may designate by notice
in writing to the registered holder hereof at the address of such
holder appearing on the books of the Company) and upon payment of
the Exercise Price multiplied by the number of Warrant Shares
thereby purchased; whereupon the holder of this Warrant shall be
entitled to receive a certificate for the number of shares of
Common Stock so purchased. Certificates for shares purchased
hereunder shall be delivered to the holder hereof within six (6)
business days after the date on which this Warrant shall have been
exercised as aforesaid. Payment of the Exercise Price may be by
certified check or cashier's check or by wire transfer to an
account designated by the Company in an amount equal to the
Exercise Price multiplied by the number of Warrant Shares
("Aggregate Exercise Price").
(b) Shareholder Approval. In connection with the transactions
pursuant to which the Company is issuing this Warrant, the Company
is also issuing (i) to the Investor certain shares of a new series
of Preferred Stock designated as Series 10 Class J Convertible
Preferred Stock ("Preferred Stock"), which is convertible into
Common Stock pursuant to the terms thereof pursuant to the
Agreement, and (ii) certain warrants to Liviakis Financial
Communications, Inc. ("Liviakis") and Robert B. Prag (collectively
the "Liviakis Warrants") providing for the purchase of up to an
aggregate of 2,500,000 shares of Common Stock pursuant to the terms
of that certain Placement and Consulting Agreement dated June 30th,
1998 between the Corporation and Liviakis ("Liviakis Consulting
Agreement").
If (i) the aggregate number of shares of Common Stock issued by the
Company as a result of (a) conversion of the Preferred Stock, (b)
payment of dividends accrued on the Preferred Stock, (c) exercise
of this Warrant and (d) exercise of the Liviakis Warrants, exceeds
2,388,347 shares of Common Stock (which equals 19.9% of the
outstanding shares of Common Stock of the Company as of the date of
this Warrant) and (ii) the Investor has converted or elects to
convert any of the then outstanding shares of Preferred Stock
pursuant to the terms of the Preferred Stock at a Conversion Price
(as defined in the Certificate of Designations) less than $1.875
($1.875 being the market value per share of Common Stock as quoted
on the NASDAQ as of the close of business on June 30th, 1998)
pursuant to the terms of the Preferred Stock, other than if the
Conversion Price is less than $1.875 solely as a result of the
anti-dilution provisions of the Preferred Stock, then,
notwithstanding anything in this Warrant to the contrary,
thereafter the Company shall not issue any shares of Common Stock
as a result of the exercise of this Warrant unless and until the
Company shall have obtained approval of its shareholders of the
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transactions referenced to in the Agreement and the Liviakis
Consulting Agreement pursuant to requirements of subparagraph
(25)(H)(i)d, (iv) and (v) of Rule 4310 of the NASDAQ Marketplace
Rules ("Shareholder Approval").
If Shareholder Approval is required as set forth in the above
paragraph, the Company shall take all practicable steps to obtain
such Shareholder Approval within ninety days of the event
triggering the need for Shareholder Approval. The Company and the
Holder covenant to vote all shares of Common Stock over which they
have voting control in favor of such Shareholder Approval.
4. No Fractional Shares or Script. No fractional shares or scrip
representing fractional shares shall be issued upon the exercise of
this Warrant. Fractional Shares shall be rounded down to the
nearest whole shares of Common Stock.
5. Charges, Taxes and Expenses. Issuance of certificates for
shares of Common Stock upon the exercise of this Warrant shall be
made without charge to the holder hereof for any issue or transfer
tax or other incidental expense in respect of the issuance of such
certificate, all of which taxes and expenses shall be paid by the
Company, and such certificates shall be issued in the name of the
holder of this Warrant or in such name or names as may be directed
by the holder of this Warrant; provided, however, that in the event
certificates for shares of Common Stock are to be issued in a name
other than the name of the holder of this Warrant, this Warrant
when surrendered for exercise shall be accompanied by the
Assignment Form attached hereto duly executed by the holder hereof,
and provided further, that upon any transfer involved in the
issuance or delivery of any certificates for shares of Common
Stock, the Company may require, as a condition thereto, the payment
of a sum sufficient to reimburse it for any transfer tax incidental
thereto.
6. Closing of Books. Unless otherwise required by law or the
principal trading market for the Company's Common Stock, the
Company will not close its shareholder books or records in any
manner which prevents the timely exercise of this Warrant for a
period of time in excess of five (5) trading days per year.
7. No Rights as Shareholder until Exercise. This Warrant does
not entitle the holder hereof to any voting rights or other rights
as a shareholder of the Company prior to the exercise thereof.
Upon the surrender of this Warrant and the payment of the Aggregate
Exercise Price determined by multiplying the Exercise Price by the
number of Warrant Shares so purchased, the Warrant Shares so
purchased shall be, and be deemed to be, issued to such holder as
the record owner of such shares as of the close of business on the
later of the date of such surrender or payment.
8. Assignment and Transfer of Warrant. This Warrant may be
assigned by the surrender of this Warrant and the Assignment Form
annexed hereto duly executed at the office of the Company (or such
other office or agency of the Company as it may designate by notice
in writing to the registered holder hereof at the address of such
holder appearing on the books of the Company); provided, however,
that the Company may require, as a condition thereto, the payment
of a sum sufficient to reimburse it for any expenses of transfer
incidental thereto and that this Warrant may not be resold or
otherwise transferred except (i) in a transaction registered under
the Securities Act of 1933 (the "Securities Act"), or (ii) in a
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transaction pursuant to an exemption, if available, from such
registration and an opinion of counsel reasonably satisfactory to
counsel for the Company is obtained by the holder of this Warrant
to the effect that the transaction is so exempt.
9. Loss, Theft, Destruction or Mutilation of Warrant. The
Company represents and warrants that upon receipt by the Company of
evidence reasonably satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant certificate or any stock
certificate relating to the Warrant Shares, and in case of loss,
theft or destruction, of indemnity or security reasonably
satisfactory to it, and upon reimbursement to the Company of all
reasonable expenses incidental thereto, and upon surrender and
cancellation of such Warrant or stock certificate, if mutilated,
the Company will make and deliver a new Warrant or stock
certificate of like tenor and dated as of such cancellation, in
lieu of such Warrant or stock certificate.
10. Saturdays, Sundays, Holidays, etc. If the last or appointed
day for the taking of any action or the expiration of any right
required or granted herein shall be a Saturday, Sunday or a legal
holiday in the State of New York, then such action may be taken or
such right may be exercised on the next succeeding day not a legal
holiday.
11. Effect of Certain Events.
(a) If at any time the Company proposes (i) to sell or otherwise
convey all or substantially all of its assets or (ii) to effect a
merger or consolidation of the Company in which the Company shall
not be the survivor (collectively, a "Sale or Merger Transaction"),
in which the consideration to be received by the Company or its
shareholders consists solely of cash, then the Warrant shall
terminate if the Warrant has not been exercised by the effective
date of such sale or merger transaction, and the Company shall give
the holder of this Warrant thirty (30) days notice of such
termination and of the proposed effective date of the Sale or
Merger transaction.
(b) In case the Company shall at any time effect a Sale or Merger
Transaction in which the consideration to be received by the
Company or its shareholders consists in whole or in part of
consideration other than cash, the holder of this Warrant shall
have the right thereafter to purchase, by exercise of this Warrant
and payment of the Aggregate Exercise Price in effect immediately
prior to such action, the kind and amount of shares and other
securities and property which it would have owned or have been
entitled to receive after the happening of such sale or merger
transaction had this Warrant been exercised immediately prior
thereto.
12. Adjustments of Exercise Price and Number of Warrant Shares.
The number and kind of securities purchasable upon the exercise of
this Warrant and the Exercise Price shall be subject to adjustment
from time to time upon the happening of any of the following.
In case the Company shall (i) declare or pay a dividend in shares
of Common Stock or make a distribution, without receipt of
consideration, in shares of Common Stock to holders of its
outstanding Common Stock, (ii) subdivide its outstanding shares of
Common Stock, (iii) combine its outstanding shares of Common Stock
into a smaller number of shares of Common Stock or (iv) issue any
shares of its capital stock in a reclassification of the Common
Stock, then the number of Warrant Shares purchasable upon exercise
of this Warrant immediately prior thereto shall be adjusted so that
the holder of this Warrant shall be entitled to receive the kind
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and number of Warrant Shares or other securities of the Company
which he would have owned or have been entitled to receive had such
Warrant been exercised in advance thereof. Upon each such
adjustment of the kind and number of Warrant Shares or other
securities of the Company which are purchasable hereunder, the
holder of this Warrant shall thereafter be entitled to purchase the
number of Warrant Shares or other securities resulting from such
adjustment at an Exercise Price per such Warrant Share or other
security obtained by multiplying the Exercise Price in effect
immediately prior to such adjustment by the number of Warrant
Shares purchasable pursuant hereto immediately prior to such
adjustment and dividing by the number of Warrant Shares or other
securities of the Company resulting from such adjustment. An
adjustment made pursuant to this paragraph shall become effective
immediately after the effective date of such event retroactive to
the record date, if any, for such event.
13. Voluntary Adjustment by the Company . The Company may at any
time during the term of this Warrant, reduce the then current
Exercise Price to any amount and for any period of time deemed
appropriate by the Board of Directors of the Company.
14. Notice of Adjustment. Whenever the number of Warrant Shares
or number or kind of securities or other property purchasable upon
the exercise of this Warrant or the Exercise Price is adjusted, as
herein provided, the Company shall promptly mail by registered or
certified mail, return receipt requested, to the holder of this
Warrant notice of such adjustment or adjustments setting forth the
number of Warrant Shares (and other securities or property)
purchasable upon the exercise of this Warrant and the Exercise
Price of such Warrant Shares (and other securities or property)
after such adjustment, setting forth a brief statement of the facts
requiring such adjustment and setting forth the computation by
which such adjustment was made. Such notice, in absence of
manifest error, shall be conclusive evidence of the correctness of
such adjustment.
15. Authorized Shares. The Company covenants that during the
period the Warrant is outstanding, it will reserve from its
authorized and unissued Common Stock a sufficient number of shares
to provide for the issuance of the Warrant Shares upon the exercise
of any purchase rights under this Warrant. The Company further
covenants that its issuance of this Warrant shall constitute full
authority to its officers who are charged with the duty of
executing stock certificates to execute and issue the necessary
certificates for the Warrant Shares upon the exercise of the
purchase rights under this Warrant. The Company will take all such
reasonable action as may be necessary to assure that such Warrant
Shares may be issued as 'provided herein without violation of any
applicable law or regulation, or of any requirements of prove the
NASDAQ Stock Market or any domestic securities exchange upon which
the Common Stock may be listed.
16. Registration Rights. The Company agrees that the Warrant
Shares shall have those registration rights as set forth in Section
10(a) of the Agreement. It is expressly acknowledged and agreed
that all references to Warrant Shares are to shares of Common Stock
issuable upon exercise of this Warrant, in whole or in part, from
time to time and at any time.
17. Miscellaneous.
(a) Issue Date, Jurisdiction. The provisions of this Warrant
shall be construed and shall be given effect in all respects as if
it had been issued and delivered by the Company on the date hereof.
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This Warrant shall be binding upon any successors or assigns of the
Company. This Warrant shall constitute a contract under the laws
of the State of Delaware, without regard to its conflict of law,
principles or rules. This Agreement and any dispute, disagreement,
or issue of construction or interpretation arising hereunder
whether relating to its execution, its validity, the obligations
provided herein or performance shall be governed or interpreted
according to the internal laws of the State of Delaware without
regard to choice of law considerations. The federal courts located
in the State of Delaware shall have exclusive jurisdiction over any
cause or controversy arising under the terms of this Agreement or
between the parties as the result of any act taken or failure to
act not taken by either party pursuant to this Agreement.
(b) Restrictions. The holder hereof acknowledges that the Warrant
Shares acquired upon the exercise of this Warrant, if not
registered, will have restrictions upon resale imposed by state and
federal securities laws.
(c) Modification and Waiver. This Warrant and any provisions
hereof may be changed, waived, discharged or terminated only by an
instrument in writing signed by the party against which enforcement
of the same is sought.
(d) Notices. Any notice, request or other document required or
permitted to be given or delivered to the holders hereof by the
Company shall be delivered or shall be sent by certified or
registered mail, postage prepaid, to each such holder at its
address as shown on the Books of the Company or to the Company at
the address set forth in the Agreement.
(e) Capitalized Terms. All capitalized terms not otherwise
defined herein shall have the meaning assigned to them in the
Agreement.
(d) Entire Agreement. This Warrant, together with all documents
referenced herein, embody the entire agreement and understanding
between the parties hereto with respect to the subject matter
hereof and supersedes all prior oral or written agreements and
understandings relating to the subject matter hereof. No
statement, representation, warranty, covenant or agreement of any
kind not expressly set forth in this Agreement shall affect, or be
used to interpret, change or restrict, the express terms and
provisions of this Agreement.
18. Disposition of Warrants or Shares.
The Holder of this Warrant Certificate, by its acceptance thereof,
agrees that (a) no public distribution of Warrants or the Warrant
Shares will be made in violation of the provisions of the 1933 Act
(the "Act"), and (b) during such period as delivery of a prospectus
with respect to Warrants or Warrant Shares may be required by the
Act, no public distribution of Warrants or Warrant Shares will be
made in a manner or on terms different from those set forth in, or
without delivery of, a prospectus then meeting the requirements of
Section 10 of the Act and in compliance with all applicable state
securities laws, The Holder of this Warrant Certificate and each
transferee hereof further agrees that if any distribution of any of
the Warrants or Warrant Shares is proposed to be made by them
otherwise than by delivery of a prospectus meeting the requirements
of Section 10 of the Act, such action shall be taken only after
receipt by the Company of an opinion of its counsel, to the effect
that the proposed distribution will not be in violation of the Act
or of applicable state law. Furthermore, it shall be a condition
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to the transfer of the Warrants that any transferee thereof deliver
to the Company his or its written agreement to accept and be bound
by all of the terms and conditions contained in this Warrant
Certificate,
By acceptance hereof, the Holder represents and warrants that this
Warrant is being acquired, and all Warrant Shares to be purchased
upon the exercise of this Warrant will be acquired, by the Holder
solely for the account of the Holder and not with a view to the
fractionalization and distribution thereof, and will not be sold or
transferred except in accordance with the applicable provisions of
the Act and the rules and regulations promulgated hereunder, and
the Holder agrees that neither this Warrant Certificate nor any of
the Warrant Shares may be sold or transferred except under cover of
a registration statement under the Act which is effective and
current with respect to such Warrant Shares or pursuant to an
opinion of counsel reasonably satisfactory to the Company that
registration under the Act is not required in connection with such
sale or transfer. Any Warrant Shares issued upon exercise of this
Warrant shall bear a legend to the following effect:
The securities represented by this certificate have not
been registered under the Securities Act of 1933, as
amended ("the Act"), or qualified under applicable state
securities laws, and are restricted securities within the
meaning of the Act. Such securities may not be sold or
transferred, except pursuant to a registration statement
under such Act and qualification under applicable state
securities laws which are effective and current with
respect to such securities or pursuant to an opinion of
counsel reasonably satisfactory to the issuer of such
securities that registration and qualification are not
required under applicable federal or state securities
laws or an exemption is available therefrom.
IN WITNESS WHEREOF, the Company has caused this Warrant to be
executed by its officer thereunto duly authorized.
Dated: June 30th, 1998
PERMA FIX ENVIRONMENTAL SERVICES, INC.
Signature: /s/ Louis Centofanti
____________________________________
Dr. Louis F. Centofanti, President
THIS WARRANT AND THE SECURITIES TO BE ISSUED UPON ITS EXERCISE HAVE
NOT BEEN REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE
COMMISSION (THE "COMMISSION") OR THE SECURITIES COMMISSION OF ANY
STATE PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SECTION 4(2)
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT")
AND/OR REGULATION D PROMULGATED UNDER THE 1933 ACT. THIS WARRANT
AND THE SECURITIES TO BE ISSUED UPON ITS EXERCISE MAY NOT BE SOLD,
PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED UNLESS REGISTERED
UNDER THE 1933 ACT, OR AN EXEMPTION FROM SUCH REGISTRATION IS
AVAILABLE AND IN THE CASE OF AN EXEMPTION, ONLY IF THE COMPANY HAS
RECEIVED AN OPINION FROM COUNSEL SATISFACTORY TO THE COMPANY THAT
SUCH TRANSACTION DOES NOT REQUIRE REGISTRATION OF THE SECURITIES.
THIS WARRANT SHALL NOT CONSTITUTE AN OFFER TO SELL NOR A
SOLICITATION TO BUY THE WARRANT OR THE SECURITIES TO BE ISSUED UPON
ITS EXERCISE IN ANY JURISDICTION IN WHICH SUCH OFFER OR
SOLICITATION WOULD BE UNLAWFUL.
COMMON STOCK PURCHASE WARRANT
No. 2
TO PURCHASE 200,000 SHARES OF COMMON STOCK OF
PERMA FIX ENVIRONMENTAL SERVICES, INC.
THIS CERTIFIES that, for value received, RBB Bank
Aktiengesellschaft, organized under the laws of Austria and located
in Austria (the "Investor"), is entitled, upon the terms and
subject to the conditions hereinafter set forth, at any time on or
after June 30th, 1998 and on or prior to June 30th, 2001 (the
"Termination Date") but not thereafter, to subscribe for and
purchase from PERMA FIX ENVIRONMENTAL SERVICES, INC., a corporation
incorporated in the State of Delaware (the "Company"), two hundred
thousand (200,000) shares (the "Warrant Shares") of Common Stock,
$.001 par value per share, of the Company (the "Common Stock").
The exercise price of one share of Common Stock (the "Exercise
Price") under this Warrant shall be equal to $1.875. The Exercise
Price and the number of shares for which the Warrant is exercisable
shall be subject to adjustment as provided herein. This Warrant is
being issued in connection with the Private Securities Subscription
Agreement dated June 30th, 1998 (the "Agreement") between the
Company and the Investor.
1. Title of Warrant. Prior to the expiration hereof and subject
to compliance with applicable laws, this Warrant and all rights
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hereunder are transferable, in whole or in part, at the office or
agency of the Company by the holder hereof in person or by duly
authorized attorney, upon surrender of this Warrant together with
the Assignment Form annexed hereto properly endorsed, subject to
the 1933 Act and applicable state securities laws.
2. Authorization of Shares. The Company covenants that all
shares of Common Stock which may be issued upon the exercise of
rights represented by this Warrant will, upon exercise of the
rights represented by this Warrant and full payment of the Exercise
Price multiplied by the number of Warrant Shares to be purchased,
be duly authorized, validly issued, fully paid and nonassessable
and free from all taxes, liens and charges in respect of the issue
thereof (other than taxes in respect of any transfer occurring
contemporaneously with such issue).
3. Exercise of Warrant. (a) Upon presentation and surrender of
this Warrant and the Notice of Exercise Form annexed hereto duly
executed by the Investor, at the office of the Company (or such
other office or agency of the Company as it may designate by notice
in writing to the registered holder hereof at the address of such
holder appearing on the books of the Company) and upon payment of
the Exercise Price multiplied by the number of Warrant Shares
thereby purchased; whereupon the holder of this Warrant shall be
entitled to receive a certificate for the number of shares of
Common Stock so purchased. Certificates for shares purchased
hereunder shall be delivered to the holder hereof within six (6)
business days after the date on which this Warrant shall have been
exercised as aforesaid. Payment of the Exercise Price may be by
certified check or cashier's check or by wire transfer to an
account designated by the Company in an amount equal to the
Exercise Price multiplied by the number of Warrant Shares
("Aggregate Exercise Price").
(b) Shareholder Approval. In connection with the transactions
pursuant to which the Company is issuing this Warrant, the Company
is also issuing (i) to the Investor certain shares of a new series
of Preferred Stock designated as Series 10 Class J Convertible
Preferred Stock ("Preferred Stock"), which is convertible into
Common Stock pursuant to the terms thereof pursuant to the terms of
the Agreement, dated June 30th, 1998, (the "Agreement"), and (ii)
certain warrants to Liviakis Financial Communications, Inc.
("Liviakis") and Robert B. Prag (collectively the "Liviakis
Warrants") providing for the purchase of up to an aggregate of
2,500,000 shares of Common Stock pursuant to the terms of that
certain Placement and Consulting Agreement dated June 30th, 1998
between the Corporation and Liviakis ("Liviakis Consulting
Agreement").
If (i) the aggregate number of shares of Common Stock issued by the
Company as a result of (a) conversion of the Preferred Stock, (b)
payment of dividends accrued on the Preferred Stock, (c) exercise
of this Warrant and (d) exercise of the Liviakis Warrants, exceeds
2,388,347 shares of Common Stock (which equals 19.9% of the
outstanding shares of Common Stock of the Company as of the date of
this Warrant) and (ii) the Investor has converted or elects to
convert any of the then outstanding shares of Preferred Stock
pursuant to the terms of the Preferred Stock at a Conversion Price
(as defined in the Certificate of Designations) less than $1.875
($1.875 being the market value per share of Common Stock as quoted
on the NASDAQ as of the close of business on June 30th, 1998)
pursuant to the terms of the Preferred Stock, other than if the
Conversion Price is less than $1.875 solely as a result of the
anti-dilution provisions of the Preferred Stock, then,
notwithstanding anything in this Warrant to the contrary,
thereafter the Company shall not issue any shares of Common Stock
as a result of the exercise of this Warrant unless and until the
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Company shall have obtained approval of its shareholders of the
transactions referenced to in the Agreement and the Liviakis
Consulting Agreement pursuant to requirements of subparagraph
(25)(H)(i)d, (iv) and (v) of Rule 4310 of the NASDAQ Marketplace
Rules ("Shareholder Approval").
If Shareholder Approval is required as set forth in the above
paragraph, the Company shall take all practicable steps to obtain
such Shareholder Approval within ninety days of the event
triggering the need for Shareholder Approval. The Company and the
Holder covenant to vote all shares of Common Stock over which they
have voting control in favor of such Shareholder Approval.
4. No Fractional Shares or Script. No fractional shares or scrip
representing fractional shares shall be issued upon the exercise of
this Warrant. Fractional Shares shall be rounded down to the
nearest whole shares of Common Stock.
5. Charges, Taxes and Expenses. Issuance of certificates for
shares of Common Stock upon the exercise of this Warrant shall be
made without charge to the holder hereof for any issue or transfer
tax or other incidental expense in respect of the issuance of such
certificate, all of which taxes and expenses shall be paid by the
Company, and such certificates shall be issued in the name of the
holder of this Warrant or in such name or names as may be directed
by the holder of this Warrant; provided, however, that in the event
certificates for shares of Common Stock are to be issued in a name
other than the name of the holder of this Warrant, this Warrant
when surrendered for exercise shall be accompanied by the
Assignment Form attached hereto duly executed by the holder hereof,
and provided further, that upon any transfer involved in the
issuance or delivery of any certificates for shares of Common
Stock, the Company may require, as a condition thereto, the payment
of a sum sufficient to reimburse it for any transfer tax incidental
thereto.
6. Closing of Books. Unless otherwise required by law or the
principal trading market for the Company's Common Stock, the
Company will not close its shareholder books or records in any
manner which prevents the timely exercise of this Warrant for a
period of time in excess of five (5) trading days per year.
7. No Rights as Shareholder until Exercise. This Warrant does
not entitle the holder hereof to any voting rights or other rights
as a shareholder of the Company prior to the exercise thereof.
Upon the surrender of this Warrant and the payment of the Aggregate
Exercise Price determined by multiplying the Exercise Price by the
number of Warrant Shares so purchased, the Warrant Shares so
purchased shall be, and be deemed to be, issued to such holder as
the record owner of such shares as of the close of business on the
later of the date of such surrender or payment.
8. Assignment and Transfer of Warrant. This Warrant may be
assigned by the surrender of this Warrant and the Assignment Form
annexed hereto duly executed at the office of the Company (or such
other office or agency of the Company as it may designate by notice
in writing to the registered holder hereof at the address of such
holder appearing on the books of the Company); provided, however,
that the Company may require, as a condition thereto, the payment
of a sum sufficient to reimburse it for any expenses of transfer
incidental thereto and that this Warrant may not be resold or
otherwise transferred except (i) in a transaction registered under
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the Securities Act of 1933 (the "Securities Act"), or (ii) in a
transaction pursuant to an exemption, if available, from such
registration and an opinion of counsel reasonably satisfactory to
counsel for the Company is obtained by the holder of this Warrant
to the effect that the transaction is so exempt.
9. Loss, Theft, Destruction or Mutilation of Warrant. The
Company represents and warrants that upon receipt by the Company of
evidence reasonably satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant certificate or any stock
certificate relating to the Warrant Shares, and in case of loss,
theft or destruction, of indemnity or security reasonably
satisfactory to it, and upon reimbursement to the Company of all
reasonable expenses incidental thereto, and upon surrender and
cancellation of such Warrant or stock certificate, if mutilated,
the Company will make and deliver a new Warrant or stock
certificate of like tenor and dated as of such cancellation, in
lieu of such Warrant or stock certificate.
10. Saturdays, Sundays, Holidays, etc. If the last or appointed
day for the taking of any action or the expiration of any right
required or granted herein shall be a Saturday, Sunday or a legal
holiday in the State of New York, then such action may be taken or
such right may be exercised on the next succeeding day not a legal
holiday.
11. Effect of Certain Events.
(a) If at any time the Company proposes (i) to sell or otherwise
convey all or substantially all of its assets or (ii) to effect a
merger or consolidation of the Company in which the Company shall
not be the survivor (collectively, a "Sale or Merger Transaction"),
in which the consideration to be received by the Company or its
shareholders consists solely of cash, then the Warrant shall
terminate if the Warrant has not been exercised by the effective
date of such sale or merger transaction, and the Company shall give
the holder of this Warrant thirty (30) days notice of such
termination and of the proposed effective date of the Sale or
Merger transaction.
(b) In case the Company shall at any time effect a Sale or Merger
Transaction in which the consideration to be received by the
Company or its shareholders consists in whole or in part of
consideration other than cash, the holder of this Warrant shall
have the right thereafter to purchase, by exercise of this Warrant
and payment of the Aggregate Exercise Price in effect immediately
prior to such action, the kind and amount of shares and other
securities and property which it would have owned or have been
entitled to receive after the happening of such sale or merger
transaction had this Warrant been exercised immediately prior
thereto.
12. Adjustments of Exercise Price and Number of Warrant Shares.
The number and kind of securities purchasable upon the exercise of
this Warrant and the Exercise Price shall be subject to adjustment
from time to time upon the happening of any of the following.
In case the Company shall (i) declare or pay a dividend in shares
of Common Stock or make a distribution, without receipt of
consideration, in shares of Common Stock to holders of its
outstanding Common Stock, (ii) subdivide its outstanding shares of
Common Stock, (iii) combine its outstanding shares of Common Stock
into a smaller number of shares of Common Stock or (iv) issue any
shares of its capital stock in a reclassification of the Common
Stock, then the number of Warrant Shares purchasable upon exercise
of this Warrant immediately prior thereto shall be adjusted so that
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the holder of this Warrant shall be entitled to receive the kind
and number of Warrant Shares or other securities of the Company
which he would have owned or have been entitled to receive had such
Warrant been exercised in advance thereof. Upon each such
adjustment of the kind and number of Warrant Shares or other
securities of the Company which are purchasable hereunder, the
holder of this Warrant shall thereafter be entitled to purchase the
number of Warrant Shares or other securities resulting from such
adjustment at an Exercise Price per such Warrant Share or other
security obtained by multiplying the Exercise Price in effect
immediately prior to such adjustment by the number of Warrant
Shares purchasable pursuant hereto immediately prior to such
adjustment and dividing by the number of Warrant Shares or other
securities of the Company resulting from such adjustment. An
adjustment made pursuant to this paragraph shall become effective
immediately after the effective date of such event retroactive to
the record date, if any, for such event.
13. Voluntary Adjustment by the Company . The Company may at any
time during the term of this Warrant, reduce the then current
Exercise Price to any amount and for any period of time deemed
appropriate by the Board of Directors of the Company.
14. Notice of Adjustment. Whenever the number of Warrant Shares
or number or kind of securities or other property purchasable upon
the exercise of this Warrant or the Exercise Price is adjusted, as
herein provided, the Company shall promptly mail by registered or
certified mail, return receipt requested, to the holder of this
Warrant notice of such adjustment or adjustments setting forth the
number of Warrant Shares (and other securities or property)
purchasable upon the exercise of this Warrant and the Exercise
Price of such Warrant Shares (and other securities or property)
after such adjustment, setting forth a brief statement of the facts
requiring such adjustment and setting forth the computation by
which such adjustment was made. Such notice, in absence of
manifest error, shall be conclusive evidence of the correctness of
such adjustment.
15. Authorized Shares. The Company covenants that during the
period the Warrant is outstanding, it will reserve from its
authorized and unissued Common Stock a sufficient number of shares
to provide for the issuance of the Warrant Shares upon the exercise
of any purchase rights under this Warrant. The Company further
covenants that its issuance of this Warrant shall constitute full
authority to its officers who are charged with the duty of
executing stock certificates to execute and issue the necessary
certificates for the Warrant Shares upon the exercise of the
purchase rights under this Warrant. The Company will take all such
reasonable action as may be necessary to assure that such Warrant
Shares may be issued as 'provided herein without violation of any
applicable law or regulation, or of any requirements of prove the
NASDAQ Stock Market or any domestic securities exchange upon which
the Common Stock may be listed.
16. Registration Rights. The Company agrees that the Warrant
Shares shall have those registration rights as set forth in Section
10(a) of the Agreement. It is expressly acknowledged and agreed
that all references to Warrant Shares are to shares of Common Stock
issuable upon exercise of this Warrant, in whole or in part, from
time to time and at any time.
17. Miscellaneous.
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(a) Issue Date, Jurisdiction. The provisions of this Warrant
shall be construed and shall be given effect in all respects as if
it had been issued and delivered by the Company on the date hereof.
This Warrant shall be binding upon any successors or assigns of the
Company. This Warrant shall constitute a contract under the laws
of the State of Delaware, without regard to its conflict of law,
principles or rules. This Agreement and any dispute, disagreement,
or issue of construction or interpretation arising hereunder
whether relating to its execution, its validity, the obligations
provided herein or performance shall be governed or interpreted
according to the internal laws of the State of Delaware without
regard to choice of law considerations. The federal courts located
in the State of Delaware shall have exclusive jurisdiction over any
cause or controversy arising under the terms of this Agreement or
between the parties as the result of any act taken or failure to
act not taken by either party pursuant to this Agreement.
(b) Restrictions. The holder hereof acknowledges that the Warrant
Shares acquired upon the exercise of this Warrant, if not
registered, will have restrictions upon resale imposed by state and
federal securities laws.
(c) Modification and Waiver. This Warrant and any provisions
hereof may be changed, waived, discharged or terminated only by an
instrument in writing signed by the party against which enforcement
of the same is sought.
(d) Notices. Any notice, request or other document required or
permitted to be given or delivered to the holders hereof by the
Company shall be delivered or shall be sent by certified or
registered mail, postage prepaid, to each such holder at its
address as shown on the Books of the Company or to the Company at
the address set forth in the Agreement.
(e) Capitalized Terms. All capitalized terms not otherwise
defined herein shall have the meaning assigned to them in the
Agreement.
(d) Entire Agreement. This Warrant, together with all documents
referenced herein, embody the entire agreement and understanding
between the parties hereto with respect to the subject matter
hereof and supersedes all prior oral or written agreements and
understandings relating to the subject matter hereof. No
statement, representation, warranty, covenant or agreement of any
kind not expressly set forth in this Agreement shall affect, or be
used to interpret, change or restrict, the express terms and
provisions of this Agreement.
18. Disposition of Warrants or Shares.
The Holder of this Warrant Certificate, by its acceptance thereof,
agrees that (a) no public distribution of Warrants or the Warrant
Shares will be made in violation of the provisions of the 1933 Act
(the "Act"), and (b) during such period as delivery of a prospectus
with respect to Warrants or Warrant Shares may be required by the
Act, no public distribution of Warrants or Warrant Shares will be
made in a manner or on terms different from those set forth in, or
without delivery of, a prospectus then meeting the requirements of
Section 10 of the Act and in compliance with all applicable state
securities laws, The Holder of this Warrant Certificate and each
transferee hereof further agrees that if any distribution of any of
the Warrants or Warrant Shares is proposed to be made by them
otherwise than by delivery of a prospectus meeting the requirements
of Section 10 of the Act, such action shall be taken only after
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receipt by the Company of an opinion of its counsel, to the effect
that the proposed distribution will not be in violation of the Act
or of applicable state law. Furthermore, it shall be a condition
to the transfer of the Warrants that any transferee thereof deliver
to the Company his or its written agreement to accept and be bound
by all of the terms and conditions contained in this Warrant
Certificate,
By acceptance hereof, the Holder represents and warrants that this
Warrant is being acquired, and all Warrant Shares to be purchased
upon the exercise of this Warrant will be acquired, by the Holder
solely for the account of the Holder and not with a view to the
fractionalization and distribution thereof, and will not be sold or
transferred except in accordance with the applicable provisions of
the Act and the rules and regulations promulgated hereunder, and
the Holder agrees that neither this Warrant Certificate nor any of
the Warrant Shares may be sold or transferred except under cover of
a registration statement under the Act which is effective and
current with respect to such Warrant Shares or pursuant to an
opinion of counsel reasonably satisfactory to the Company that
registration under the Act is not required in connection with such
sale or transfer. Any Warrant Shares issued upon exercise of this
Warrant shall bear a legend to the following effect:
The securities represented by this certificate have not
been registered under the Securities Act of 1933, as
amended ("the Act"), or qualified under applicable state
securities laws, and are restricted securities within the
meaning of the Act. Such securities may not be sold or
transferred, except pursuant to a registration statement
under such Act and qualification under applicable state
securities laws which are effective and current with
respect to such securities or pursuant to an opinion of
counsel reasonably satisfactory to the issuer of such
securities that registration and qualification are not
required under applicable federal or state securities
laws or an exemption is available therefrom.
IN WITNESS WHEREOF, the Company has caused this Warrant to be
executed by its officer thereunto duly authorized.
Dated: June 30th, 1998
PERMA FIX ENVIRONMENTAL SERVICES, INC.
Signature: /s/ Louis Centofanti
_____________________________________
Dr. Louis F. Centofanti, President
H:\N-P\PESI\Permawr2.EDG.wpd
CONSULTING AGREEMENT
This Consulting Agreement (the "Agreement"), effective as of
June 30, 1998 is entered into by and among PERMA FIX ENVIRONMENTAL
SERVICES, INC.,a Delaware corporation (herein referred to as the
"Company"), LIVIAKIS FINANCIAL COMMUNICATIONS, INC., a California
corporation ("LFC" or "Consultant") and ROBERT B. PRAG, an
individual ("Prag").
WHEREAS, Company is a publicly held corporation with its
common stock listed for trading on the NASDAQ Small Cap Market and
the Boston Stock Exchange;
WHEREAS, Consultant has experience in the area of corporate
finance, investor communications and financial and investor public
relations;
WHEREAS, Company desires to engage the services of Consultant
to assist and consult with the Company and to represent the Company
in connection with investors' communications and public relations
with existing shareholders, brokers, dealers and other investment
professionals as to the Company's current and proposed activities;
WHEREAS, Prag is an executive officer of Consultant; and,
WHEREAS, the Consultant and Prag have assisted the Company in
connection with that certain Private Securities Subscription
Agreement between the Company and RBB Bank Aktiengesellschaft ("RBB
Bank"), dated June 30, 1998 ("Subscription Agreement") whereby the
Company is to sell to RBB Bank a new series of the Company's
preferred stock in order to raise additional equity for the
Company.
NOW THEREFORE, in consideration of the promises and the mutual
covenants and agreements hereinafter set forth, the parties hereto
covenant and agree as follows:
I. PLACEMENT
1. Placement. The Consultant and Prag have provided
consulting services in connection with the placement ("Placement")
of certain securities through the Subscription Agreement and are to
be compensated by the Company for such services as described
herein.
2. Warrants. For assisting in the Placement and for other
good and valuable consideration, the Company agrees to issue and
deliver to the Consultant and to Prag a "Placement Fee" payable in
the form of warrants to purchase 2,500,000 shares of the Company's
Common Stock, par value $.001 per share ("Common Stock"), for
$1.875 per share ("Warrants") of which 1,875,000 are to be issued
to Consultant in the name of Liviakis Financial Communications, Inc
and 625,000 are to be issued to Prag in the name of Robert B. Prag.
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The term of the Warrants will be for 4 years, shall contain a
cashless exercise provision and a registration rights provision, as
provided in Exhibit A attached hereto. This Placement Fee shall be
issued to the Consultant and Prag immediately following completion
of the Placement and shall, when issued and delivered to Consultant
and Prag, be fully paid and non-assessable. The 2,500,000 Warrants
issued as a Placement Fee, constitute payment for consulting in
connection with the Placement and are nonrefundable,
non-apportionable, and non-ratable; such Warrants are not a
prepayment for future services.
2.1 Consultants and Prag each acknowledge that the Warrants
and shares of Common Stock to be issued pursuant to the Warrants
(collectively, the "Shares") have not been registered under the
Securities Act of 1933, as amended (the "Act"), and accordingly are
"restricted securities" within the meaning of Rule 144 of the Act.
As such, the Warrants and the Shares may not be resold or
transferred unless the Warrants and the Shares have been registered
under the Act or the Company has received an opinion of counsel
reasonably satisfactory to the Company that such resale or transfer
is exempt from the registration requirements of that Act.
Consultant and Prag each further understand that the exemption from
registration afforded by Rule 144 under the Act depends upon the
satisfaction of various conditions and that, if applicable, Rule
144 affords the basis for sale only in limited amounts.
2.2 In connection with the acquisition of the Warrants and
the Shares, the Consultant and Prag each represent, warrant and
covenant to the Company as follows:
a. Consultant and Prag each acknowledge that they have
been afforded the opportunity to ask questions of
and receive answers from duly authorized officers
or other representatives of the Company concerning
an investment in the Shares, and any additional
information which the Consultant and Prag have
requested.
b. Consultant and Prag have each had experience in
investments in restricted and publicly traded
securities, and Consultant and Prag have each had
experience in investments in speculative securities
and other investments which involve the risk of
loss of investment. Consultant and Prag each
acknowledge that an investment in the Warrants
and/or Shares is speculative and involves the risk
of loss. Both Consultant and Prag have the
requisite knowledge to assess the relative merits
and risks of this investment without the necessity
of relying upon other advisors, and Consultant and
Prag can afford the risk of loss of their entire
investment in the Warrants or Shares. Consultant
is an "accredited investor," as that term is
defined in Rule 501 of Regulation D promulgated
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under the Act, due to the fact that LFC (a) was not
created solely to permit the acquisition of
Warrants or Shares and has total assets in excess
of $5,000,000 and/or (b) is wholly owned by persons
who qualify as accredited investors. Prag is an
"accredited investor," as that term is defined in
Rule 501 of Regulation D promulgated under the Act,
due to the fact that Prag (a) has an individual net
worth, or joint net worth with his spouse in excess
of $1,000,000 and/or (b) had an individual income
in excess of $200,000 in each of the two most
recent years or joint income with his spouse in
excess of $300,000 in each of those years and has a
reasonable expectation of reaching the same income
based in the current year. Both LFC and Prag are
purchasers described in Section 25102 (f) (2) of
the California Corporate Securities Law of 1968, as
amended.
c. Each of Consultant and Prag is acquiring the
Warrants and the Shares for its or his own account
for long-term investment and not with a view toward
resale or distribution thereof except in accordance
with applicable securities laws.
d. Each of Consultant and Prag acknowledges that
issuance of the Warrants and the Shares has not
been made in connection with any advertisement.
e. Each of Consultant and Prag acknowledges it or he
has received copies of the Company's Form 10-K for
the year ended December 31, 1997, Form 10-Q for the
quarter ended March 31, 1998, and proxy soliciting
material for the Company's 1998 annual meeting of
shareholders.
f. Each of Consultant and Prag acknowledges that the
Shares shall upon issuance thereof have stamped or
imprinted thereon or affixed thereto a legend to
the following effect:
THE REGISTERED HOLDER HEREOF HAS
ACQUIRED THE SHARES REPRESENTED BY
THIS CERTIFICATE FOR INVESTMENT AND
NOT FOR RESALE IN CONNECTION WITH A
DISTRIBUTION THEREOF. ACCORDINGLY,
SUCH SHARES HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 AND
MAY NOT BE SOLD, TRANSFERRED OR
OTHERWISE DISPOSED OF EXCEPT
PURSUANT TO A CURRENTLY EFFECTIVE
REGISTRATION STATEMENT UNDER SAID
ACT OR OTHERWISE IN A TRANSACTION
EXEMPT FROM THE PROVISIONS OF
SECTION5 OF SAID ACT.
2.3 The Company covenants to file, in a timely manner, with
the Securities and Exchange Commission ("Commission") all
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reports required to be filed by the Company under the
Securities Exchange Act of 1934, as amended, for a period
ending the earlier of (i) twenty-four (24) months after
the termination of the Warrants if the Warrants have been
exercised, in whole or in part, or if the Warrants have
not been exercised prior to their termination, the n upon
termination of the Warrants, or (ii) the date on which
Consultant and Prag have disposed of or transformed all
of the Shares acquired upon the exercise of the Warrants,
or (iii) the date on which registration under the Act is
no longer required for the public distribution of the
Shares acquired upon the exercise of the Warrants as a
result of the provisions of Rule 144 (k) promulgated
under the Act or a similar exemption under the Act.
II. CONSULTING SERVICES
1. Term of Consultancy. The Company hereby agrees to
retain the Consultant to act in a consulting capacity to the
Company, and the Consultant hereby agrees to provide services to
the Company commencing immediately and ending on March 15, 1999.
2. Duties of Consultant. LFC agrees that it will
generally provide the following specified consulting services
through its officers and employees during the term specified in
Section II. 1 hereof:
(a) Advise and assist the Company in developing and
implementing appropriate plans and materials for presenting the
Company and its business plans, strategy and personnel to the
financial community, establishing an image for the Company in the
financial community, and creating the foundation for subsequent
financial public relations efforts;
(b) Introduce the Company to the financial community;
(c) With the cooperation of the Company, maintain an awareness
during the term of this Agreement of the Company's plans, strategy
and personnel, as they may evolve during such period, and advise
and assist the Company in communicating appropriate information
regarding such plans, strategy and personnel to the financial
community;
(d) Assist and advise the Company with respect to its (i)
stockholder and investor relations, (ii) relations with brokers,
dealers, analysts and other investment professionals, and (iii)
financial public relations generally;
(e) Perform the functions generally assigned to
investor/stockholder relations and public relations departments in
major corporations, including responding to telephone and written
inquiries (which may be referred to the Consultant by the Company);
preparing press releases for the Company with the Company's
involvement and approval or reviewing press releases, reports and
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other communications with or to shareholders, the investment
community and the general public; advising with respect to the
timing, form, distribution and other matters related to such
releases, reports and communications; and consulting with respect
to corporate symbols, logos, names, the presentation of such
symbols, logos and names, and other matters relating to corporate
image;
(f) Upon the Company's approval, disseminate information
regarding the Company to shareholders, brokers, dealers, other
investment community professionals and the general investing
public;
(g) Upon the Company's approval, conduct meetings, in person
or by telephone, with brokers, dealers, analysts and other
investment professionals to advise them of the Company's plans,
goals and activities, and assist the Company in preparing for press
conferences and other forums involving the media, investment
professionals and the general investment public;
(h) At the Company's request, review business plans,
strategies, mission statements, budgets, proposed transactions and
other plans for the purpose of advising the Company of the
investment community implications thereof; and,
(i) Otherwise perform as the Company's financial relations
and public relations consultant.
3. Allocation of Time and Energies. The Consultant hereby
promises to perform and discharge well and faithfully the
responsibilities which may be assigned to the Consultant from time
to time by the officers and duly authorized representatives of the
Company in connection with the conduct of its financial and
investor public relations and communications activities, so long as
such activities are in compliance with applicable securities laws
and regulations. Consultant shall diligently and thoroughly
provide the consulting services required hereunder. Although no
specific hours-per-day requirement will be required, Consultant and
the Company agree that Consultant will perform the duties set forth
herein above in a diligent and professional manner. The parties
acknowledge and agree that a disproportionately large amount of the
effort to be expended and the costs to be incurred by the
Consultant and the benefits to be received by the Company are
expected to occur upon and shortly after, and in any event, within
two months of the effectiveness of this Agreement. It is
explicitly understood that Consultant's performance of its duties
hereunder will in no way be measured by the price of the Company's
Common Stock, nor the trading volume of the Company's Common Stock.
4. Remuneration. As full and complete compensation for
providing the continuing consulting services for the Company, the
Company agrees to pay to Consultant the amount of One Hundred Fifty
and/no 100 Dollars ($150.00) per month during the term of this
Agreement.
5. Financing "Finder's Fee". It is understood that in the
event Consultant introduces Company, or its nominees, to a lender
or equity purchaser, not already having a preexisting relationship
with the Company and with whom the Company has not had preexisting
discussions regarding a lending arrangement or equity purchase
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arrangement, with whom Company, or its nominees, ultimately
finances or causes the completion of such financing during the term
of this Agreement or within one year from the date of termination
of this Agreement, Company agrees to compensate the Consultant for
such services with a "finder's fee" in the amount of 2.5% of
total gross funding provided by such lender or equity purchaser,
such fee to be payable in cash upon receipt of such financing by
the Company. This will be in addition to any fees payable by
Company to any other intermediary, if any, which shall be per
separate agreements negotiated between Company, and such other
intermediary. It is also understood that in the event Consultant
introduces Company or its nominees to an acquisition or business
combination (as defined below) candidate not already having a
preexisting relationship with the Company and with whom the Company
has not had preexisting discussions regarding such an acquisition
or business combination, with whom Company, or its nominees,
ultimately acquires or causes the completion of such acquisition or
business combination during the term of this Agreement or within
one year from the date of termination of this Agreement, Company,
agrees to compensate Consultant, for such services with a "finder's
fee" in the amount of 2% of the consideration paid in connection
with such acquisition or business combination, excluding the amount
of any employment contracts entered into as a result of such
acquisition or business combination, such fee to be payable in cash
upon the close of the applicable acquisition or business
combination transaction. For the purpose of this Section 5,
"business combination" shall mean any "merger or consolidation" of
the Company with another entity in which the Company is not the
survivor, the sale of all or substantially all of the Company's
assets to another entity or a transaction by which the Company
becomes a majority owned subsidiary of another entity (other than
a then existing subsidiary of the Company),with the approval of the
Company's Board of Directors. This will be in addition to any fees
payable by Company to any other intermediary, if any, which shall
be agreements negotiated between Company and such other
intermediary. It is specifically understood that Consultant is
not nor does it hold itself out be a Broker/Dealer, but is rather
merely a "Finder" in reference to the Company procuring financing
sources and acquisition or business combination candidates.
5.1 It is further understood that the Company, and not
Consultant, is responsible to perform any and all due diligence on
such lender, equity purchaser, acquisition or business combination
candidate introduced to it by Consultant, under this Agreement,
prior to Company receiving funds or closing on any acquisition or
business combination. However, Consultant agrees it will not
introduce any parties to Company, about which Consultant has any
prior knowledge of questionable, unethical or illicit activities,
5.2 Consultant will notify Company of introductions it
makes for potential sources of financing, acquisitions or business
combination in a timely manner (within approximately 3 days of
introduction) via facsimile memo. If Company has a preexisting
relationship with such nominee and believes such party should be
excluded from this Agreement, then Company will notify Consultant
promptly of such circumstance via facsimile memo.
6. Expenses. Consultant agrees to pay for all its
expenses (phone, mailing, labor, etc.), other than extraordinary
items (travel required by/or specifically requested by the Company,
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<PAGE>
luncheons or dinners to large groups of investment professionals,
mass faxing to a sizable percentage of the Company's constituents,
investor conference calls, print advertisements in publications,
etc.) approved by the Company prior to its incurring an obligation
for reimbursement.
7. Indemnification. The Company warrants and represents
that all oral communications, written documents or materials
furnished to Consultant by the Company with respect to financial
affairs, operations, profitability and strategic planning of the
Company are accurate and Consultant may rely upon the accuracy
thereof without independent investigation. The Company will
protect, indemnify and hold harmless Consultant against any claims
or litigation including any damages, liability, cost and reasonable
attorney's fees as incurred with respect thereto resulting from
Consultant's communication or dissemination of any said
information, documents or materials not designated by the Company
to LFC or Prag as "confidential" or "Company private", excluding
any such claims or litigation resulting from LFC's or Prag's
communication or dissemination of information not provided or
authorized by the Company or due to LFC's or its employees gross
negligence or willful misconduct or acts.
8. Representations. Consultant represents that it is not
required to maintain any licenses and registrations under federal
or any state regulations necessary to perform the services set
forth herein. Consultant acknowledges that, to the best of its
knowledge, the performance of the services set forth under this
Agreement will not violate any rule or provision of any regulatory
agency having jurisdiction over Consultant. Consultant
acknowledges that, to the best of its knowledge, Consultant and its
officers and directors are not the subject of any investigation,
claim, decree or judgment involving any violation of the securities
laws or regulations. Consultant further acknowledges that it is
not a securities Broker-Dealer or a registered investment advisor.
Company acknowledges that, to its knowledge, it has not violated
any rule or provision of any regulatory agency having jurisdiction
over the Company which would have a material adverse effect on the
Company and its subsidiaries, taken as a whole, except as otherwise
disclosed in the Company's filings with the Commission. Company
acknowledges that, to its knowledge, Company is not the subject of
any investigation, claim, decree or judgment involving any
violation of the securities laws, except as otherwise disclosed in
its filings with the Commission.
9. Covenants. (a) LFC and Prag each agree that neither
Prag, LFC, nor any of the directors of LFC, nor "executive
officers" of LFC, as such term is defined in Rule 405 under the Act
shall (i) sell or transfer any Warrants or (ii) sell, transfer or
dispose of the Company's Common Stock or other securities of the
Company, including, but not limited to, the selling short of any of
the Company's securities or Common Stock, during the term specified
in Section II. 1. hereof.
(b) The Company agrees that it shall cause the Company's
directors and "executive officers", as such term is defined in Rule
405 under the Act, to enter into an agreement that they shall not
sell, transfer or dispose of Common Stock, including, but not
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<PAGE>
limited to the selling short of such Common Stock or other
securities of the Company, during the term specified in Section II.
1. hereof.
10. Legal Representation. The Company acknowledges that
it has been represented by independent legal counsel in the
preparation of this Agreement. Consultant represents that it has
consulted with independent legal counsel and/or tax, financial and
business advisors, to the extent the Consultant deemed necessary.
11. Status as Independent Contractor. Consultant's
engagement pursuant to this Agreement shall be as independent
contractor, and not as an employee, officer or other agent of the
Company. Neither party to this Agreement shall represent or hold
its elf out to be the employer or employee of the other.
Consultant further acknowledges the consideration provided herein
above is a gross amount of consideration and that the Company will
not withhold from such consideration any amounts as to income
taxes, social security payments or any other payroll taxes. All
such income taxes and other such payment shall be made or provided
for by Consultant and the Company shall have no responsibility or
duties regarding such matters. Neither the Company or the
Consultant possesses the authority to bind each other in any
agreements without the express written consent of the entity to be
bound.
12. Attorney's Fee. If any legal action or any
arbitration or other proceeding is brought for the enforcement or
interpretation of this Agreement, or because of an alleged dispute,
breach, default or misrepresentation in connection with or related
to this Agreement, the successful or prevailing party shall be
entitled to recover reasonable attorneys' fees and other costs in
connection with that action or proceeding, in addition to any other
relief to which it or they may be entitled.
13. Waiver. The waiver by any party of a breach of any
provision of this Agreement by another party shall not operate or
be construed as a waiver of any subsequent breach by such other
party.
14. Notices. All notices, requests, and other
communications hereunder shall be deemed to be duly given if sent
by U.S. mail, postage prepaid, addressed to the other parties at
the address as set forth herein below:
To the Company: Perma Fix Environmental Services, Inc.
Dr. Louis F. Centofanti, CEO
Perma-Fix Environmental Services, Inc.
1940 Northwest 67th Place
Gainesville, Florida 32606-1649
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with copies simultaneously
by like means to: Conner & Winters
One Leadership Square, Suite 1700
211 North Robinson
Oklahoma City, Oklahoma 73102
Attention: Irwin H. Steinhorn, Esquire
To LFC: Liviakis Financial Communications, Inc.
John M. Liviakis, President
2420 "K" Street, Suite 220
Sacramento, California 95816
To Prag: Robert B. Prag
% Liviakis Financial Communications, Inc.
2420 "K" Street, Suite 220
Sacramento, California 95816
with copies simultaneously
by like means to: Kelly Lytton Mintz & Vann
1900 Avenue of the Stars
Suite 1450
Los Angeles, California 70067
Attention: Allen Jacobsen, Esquire
It is understood that any party may change the address to
which notices for it shall be addressed by providing notice of such
change to the other parties in the manner set forth in this
paragraph.
15. Choice of Law, Jurisdiction and Venue. This Agreement
shall be governed by, construed and enforced in accordance with the
laws of the State of California, except that the Warrants shall be
governed by, construed and enforced in accordance with the laws of
the State of Delaware. The parties agree that Sacramento County,
California will be the venue of any dispute and will have
jurisdiction over all parties except as to the Warrants.
16. Arbitration. Any controversy or claim arising out of or
relating to this Agreement, or the alleged breach thereof, or
relating to Consultant's activities or remuneration under this
Agreement, except for any controversy or claim regarding the
Warrants, shall be settled by binding arbitration in California in
accordance with the applicable rules of the American Arbitration
Association, and judgment on the award rendered by the
arbitrator(s) shall be binding on the parties and may be entered in
any court having jurisdiction thereof. Any controversy or claim
regarding the Warrants shall not be resolved pursuant to this
Section but shall be resolved pursuant to the terms of the
Warrants.
9
<PAGE>
17. Complete Agreement. This Agreement contains the entire
agreement of the parties relating to the subject matter hereof.
This Agreement and its terms may not be changed orally but only by
an agreement in writing signed by the party against whom
enforcement of any waiver, change, modification, extension or
discharge is sought.
(Balance of Page Intentionally Left Blank)
10
<PAGE>
<PAGE>
AGREED TO:
"Company"
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
By: /s/ Louis F. Centofanti
____________________________________
Dr. Louis F.Centofanti,
President and Chief Executive Officer
"Consultant"
LIVIAKIS FINANCIAL COMMUNICATIONS, INC.
By: /s/ John M. Liviakis
_____________________________________
John M. Liviakis, President
By: /s/ Robert B. Prag
______________________________________
Robert B. Prag, Sr. Vice-President
"Prag"
/s/ Robert B. Prag
________________________________________
Robert B. Prag, individually
11
NEITHER THIS WARRANT NOR ANY SHARES OF COMMON STOCK ISSUABLE UPON
THE EXERCISE OF THIS WARRANT HAVE BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR
QUALIFIED UNDER APPLICABLE STATE SECURITIES LAWS. THIS WARRANT AND
THE COMMON STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT BE
OFFERED, SOLD, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED IN
THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AND
QUALIFICATION IN EFFECT WITH RESPECT THERETO UNDER THE SECURITIES
ACT AND UNDER ANY APPLICABLE STATE SECURITIES LAW OR AN OPINION OF
COUNSEL THAT IS SATISFACTORY TO PERMA-FIX ENVIRONMENTAL SERVICES
INC. THAT SUCH REGISTRATION AND QUALIFICATION IS NOT REQUIRED UNDER
APPLICABLE FEDERAL AND STATE SECURITIES LAWS OR AN EXEMPTION
THEREFROM.
NOTWITHSTANDING THE FOREGOING, THE SHARES OF COMMON STOCK ISSUABLE
UPON EXERCISE OF THIS WARRANT ARE SUBJECT TO THE REGISTRATION
RIGHTS SET FORTH HEREIN.
No. LFC: 6-30-98-1
COMMON STOCK PURCHASE WARRANT CERTIFICATE
Dated: June 30, 1998
One Million Eight Hundred Seventy-Five Thousand(1,875,000)
Warrants
to Purchase One Million Eight Hundred Seventy-Five Thousand
(1,875,000)
Shares of Perma-Fix Environmental Services, Inc.
Common Stock, $.001 Par Value Per Share
VOID AFTER 5:00 P.M., UNITED STATES EASTERN DAYLIGHT SAVINGS TIME
on
June 29, 2002
PERMA-FIX ENVIRONMENTAL SERVICES, INC., a Delaware corporation
(the "Company"), hereby certifies that LIVIAKAS FINANCIAL
COMMUNICATIONS, INC., organized under the laws of California, and
its permissible successors and assigns (the "Warrant Holder" or
"Holder"), for value received, is entitled to purchase from the
Company at any time after January 15, 1999, until 5:00 p.m.,
Eastern Daylight Savings Time ("EST")on June 29, 2002 ("the
<PAGE>
Exercise Period"), up to an aggregate of one million eight hundred
and seventy-five thousand (1,875,000) shares (the "Shares" or
"Warrant Shares") of the Company's common stock, par value $.001
per share ("Common Stock"), at an exercise price equal to U. S.
$1.875 per share (the "Per Share Exercise Price").
1. Exercise of Warrant and Shareholder Approval.
1.1 In order to exercise this Common Stock Purchase
Warrant Certificate ("Warrant" or "Warrant Certificate"), in whole
or in part, during the Exercise Period, the Holder shall deliver to
the Company this Warrant Certificate, with the attached Election to
Purchase form duly executed and completed by the Holder and
specifying the number of Warrant Shares which Holder is purchasing
pursuant to the terms of this Warrant, at 1940 Northwest 67th Place,
Gainesville, Florida 32606-1649, together with either:
(a) payment to the Company (in the form of cash or certified
or bank cashier's check payable to the Company) in an amount equal
to the Per Share Exercise Price multiplied by the number of Warrant
Shares being purchased (the"Aggregate Exercise Price"), or
(b) Holder's written direction to the Company to retain as
the Aggregate Exercise Price for the Warrant Shares being purchased
that number of the Warrant Shares (rounded upward to next highest
full Share) being purchased which have an aggregate value equal to
the Aggregate Exercise Price. Such Warrant Shares shall be valued
for such purposes at the highest closing price of the Company's
Common Stock in the principal market in which the Company's Common
Stock trade for a five day period consisting of the trading day
preceding the date on which this Warrant and the Purchase Form are
delivered to the Company plus the four preceding trading days.
As soon as practicable thereafter, but in any event within ten
(10) business days after the Company's receipt of all of the above
documents, the Company shall cause to be delivered to the Holder a
certificate issued in the Holder's name evidencing (x) in the case
payment of the exercise price pursuant to (a) above the full number
of Warrant Shares as to which this Warrant was exercised by the
Holder or (y) in the case of payment of the exercise price pursuant
to (b) above the number of Warrant Shares remaining after
subtracting from the full number of Warrant Shares as to which this
Warrant was exercised by Holder that number of Warrant Shares which
the Company is to retain pursuant to (b) above. Holder shall be
considered to be the holder and owner of the Warrant Shares to be
evidenced by such certificate as of the close of business on the
date the Company received the notice of exercise accompanied by
payment, as contemplated herein, without regarding to the date of
actual issuance of the certificate representing such Shares.
All or less than all of the Warrant Shares represented by this
Certificate may be exercised and, in case of the exercise of less
than all, the Company, upon surrender hereof, will deliver to the
Holder a new Warrant Certificate of like tenor and dated the date
hereof entitling said Holder to purchase the number of Warrant
Shares represented by this Warrant which have not been exercised
and to receive the Registration Rights set forth in Section 8 below
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<PAGE>
(to the extent such rights have not already been exercised) with
respect to such Warrant Shares which have not been exercised.
1.2 In connection with the transactions pursuant to which
the Company is issuing this Warrant, the Company is also issuing
(i) to RBB Bank Aktiengesellschaft ("RBB Bank") certain shares of
a new series of Preferred Stock designated as Series 10 Class J
Convertible Preferred Stock ("Preferred Stock"), which Preferred
Stock is convertible into the Company's Common Stock pursuant to
the terms thereof, and certain warrants to RBB Bank for the
purchase by RBB Bank of up to 125,000 shares of Common Stock ("RBB
Warrants") pursuant to the terms of that certain Private Securities
Subscription Agreement, dated June 30, 1998 between the Company and
RBB Bank ("RBB Subscription Agreement"), and (ii) a certain warrant
to Robert B. Prag (collectively the "Prag Warrant") providing for
the purchase of up to an aggregate of 625,000 shares of Common
Stock pursuant to the terms of that certain Placement and
Consulting Agreement, dated June 30, 1998 between the Corporation
and the Holder ("Liviakis Consulting Agreement").
If (i) the aggregate number of shares of Common Stock issued
by the Company as a result of (a) conversion of the Preferred
Stock, (b) payment of dividends accrued on the Preferred Stock, (c)
exercise of the RBB Warrants (d) exercise of this Warrant and (e)
exercise of the Prag Warrant exceeds 2,388,347 shares of Common
Stock (which equals 19.9% of the outstanding shares of Common Stock
of the Company as of the date of this Warrant) and (ii) RBB Bank
has converted or elects to convert any of the then outstanding
shares of Preferred Stock pursuant to the terms of the Preferred
Stock at a Conversion Price (as defined in the terms of the
Preferred Stock) less than $1.875 ($1.875 being the market value
per share of Common Stock as quoted on the NASDAQ as of the close
of business on June 30, 1998), other than if the Conversion Price
is less than $1.875 solely as a result of the anti-dilution
provisions of the Preferred Stock, then, notwithstanding anything
in this Warrant to the contrary, thereafter the Company shall not
issue any shares of Common Stock as a result of the exercise of
this Warrant unless and until the Company shall have obtained
approval of its shareholders entitled to vote on the transactions
referenced to in the RBB Subscription Agreement and the Liviakis
Consulting Agreement pursuant to requirements of subparagraphs
(25)(H)(i)d, (iv) and (v) of Rule 4310 of the NASDAQ Marketplace
Rules ("Shareholder Approval").
If Shareholder Approval is required as set forth in the above
paragraph, the Company shall take all practicable steps to obtain
such Shareholder Approval within ninety (90) days of the event
triggering the need for Shareholder Approval (the "90 Day Period").
The Holder shall, and the Company shall use its best efforts to
cause its officers and directors to, vote all shares of Common
Stock of the Company over which they have voting control in favor
of such Shareholder Approval. If the Company is required to obtain
such Shareholder Approval pursuant to the requirements of the above
paragraph but is unable to obtain such Shareholder Approval within
the 90 Day Period, then, the Company agrees that the Exercise
Period shall be extended for that number of additional days equal
to the number of days in the period of time beginning with the day
after the expiration of the 90 Day Period and ending as of the day
such Shareholder Approval is obtained.
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<PAGE>
In addition, if the Company is required to obtain such
Shareholder Approval within the 90 Day Period but is unable to
obtain such Shareholder Approval within such 90 Day Period and
thereafter the Holder notifies the Company in writing of its
intention to exercise this Warrant for all or a portion of the
Warrant Shares pursuant to the requirements of this Warrant
("Notification of Intention") before such Shareholder Approval is
obtained, with such Notification of Intention specifying the exact
number of Warrant Shares that the Holder intends to purchase
("Warrant Shares to be Purchased") pursuant to the requirements of
this Warrant, then the Company shall have an additional sixty (60)
days ("Additional 60 Days") from receipt by the Company from the
Holder of such Notification of Intention. If the Company has not
obtained the Shareholder Approval within the Additional 60 Days,
then the Holder shall have the option to terminate this Warrant as
to the Warrant Shares to be Purchased, and, in the event of such
termination, the Company shall pay to the Holder an amount
("Payment Amount") determined by subtracting from (a) an amount
determined by multiplying the fair market value (as defined below)
per share of Common Stock by the number of Warrant Shares to be
Purchased, (b) the Aggregate Exercise Price of the Warrant Shares
to be Purchased. If the Holder elects to terminate this Warrant as
to the Warrant Shares to be Purchased for the Payment Amount
pursuant to the terms of this paragraph ("Election"), the Holder
shall deliver to the Company written notice ("Election Notice") of
the Election, and the Company shall have fifteen (15) days from
receipt of such Election Notice to pay the Payment Amount to the
Holder either in cash or by delivering to the Holder the Company's
promissory note payable to the order of the Holder in the principal
amount of the Payment Amount. If the Company elects to pay the
Payment Amount by delivery to the Holder such promissory note, such
promissory note shall be in the principal amount of the Payment
Amount and shall bear an annual rate of interest equal to the prime
rate announced from time to time by the Chase Manhattan Bank plus
1%, with the principal payable in thirty-six (36) equal monthly
installments plus accrued and unpaid interest, and the first
monthly installment beginning the first full month after issuance
of such promissory note. Such promissory note shall be in form
reasonably satisfactory to the Holder. For the purpose of this
paragraph, "fair market value" per share of the Company's Common
Stock shall be the average closing price of a share of the
Company's Common Stock as reported on the National Association of
Securities Dealers Automated Quotation System ("NASDAQ"), or if the
Common Stock is not listed on the NASDAQ but is listed for trading
on a national securities exchange the average closing price of a
share of Common Stock as reported on such national securities
exchange, for the five (5) trading days immediately prior to the
Company's receipt of the Election Notice from the Holder.
Notwithstanding anything herein to the contrary, this Warrant as to
the Warrant Shares to be Purchased shall terminate in all respects
as of the date of receipt by the Company of the Holder's Election
Notice.
2. Exchange and Transfer. This Warrant Certificate, at any time
prior to the exercise hereof, upon presentation and surrender to
the Company, may be exchanged, alone or with other certificates of
like tenor registered in the name of the same Holder, for another
Certificate of like tenor in the name of such Holder exercisable
for the aggregate number of Warrant Shares as the Warrant
Certificate surrendered.
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<PAGE>
3. Rights and Obligations of Holder of this Certificate. The
Holder of this Warrant Certificate shall not, by virtue hereof, be
entitled to any rights of a shareholder in the Company, either at
law or in equity; provided, however, that in the event any shares
of Common Stock are issued to the Holder hereof upon exercise of
some or all of the Warrants evidenced by this Warrant Certificate,
such Holder shall, for all purposes, be deemed to have become the
holder of record of such Common Stock on the date on which this
Warrant Certificate and a duly executed Election to Purchase form
were surrendered and payment of the Aggregate Exercise Price was
made pursuant to the terms hereof, irrespective of the date of
delivery of such share certificate. The rights of the Holder of
this Warrant Certificate are limited to those expressed herein and
the Holder of this Warrant Certificate, by his acceptance hereof,
consents and agrees to be bound by, and to comply with, all of the
provisions of this Warrant Certificate, including, without
limitation, all of the obligations imposed upon the Holder
contained in this Warrant Certificate. In addition, the Holder, by
accepting this Warrant Certificate, agrees that the Company may
deem and treat the person in whose name this Warrant Certificate is
registered on the books of the Company as the absolute, true and
lawful owner of this Warrant Certificate for all purposes
whatsoever, and the Company shall not be affected by any notice to
the contrary.
4. Common Stock.
4.1 The Company covenants and agrees that all shares of
Common Stock which may be acquired by the Holder under this Warrant
Certificate will, when issued pursuant to the terms of this Warrant
and upon delivery, be duly and validly authorized and issued, fully
paid and nonassessable, and free from all stamp taxes, liens, and
charges with respect to the purchase thereof.
4.2 The Company covenants and agrees that it will, at all
times, reserve and keep available an authorized number of shares of
its Common Stock and other applicable securities sufficient to
permit the exercise in full of all outstanding options, warrants
and rights, including this Warrant.
5. No Fractional Shares. No Fractional Shares or scrip
representing Fractional Shares shall be issued upon the exercise of
this Warrant. Fractional shares shall be rounded down to the
nearest whole share of Common Stock.
6. Disposition of Warrant or Shares.
6.1 The Holder of this Warrant Certificate, by his
acceptance thereof, agrees that (a) no public distribution of this
Warrant or Warrant Shares will be made in violation of the
provisions of the Securities Act of 1933, as amended, and the Rules
and Regulations promulgated thereunder (collectively, the "Act"),
and (b) during such period as delivery of a prospectus with respect
to this Warrant or Warrant Shares may be required by the Act, no
public distribution of this Warrant or Warrant Shares will be made
in a manner or on terms different from those set forth in, or
without delivery of, a prospectus then meeting the requirements of
-5-
<PAGE>
Section 10 of the Act and in compliance with all applicable state
securities laws. The Holder of this Warrant Certificate and each
transferee hereof further agrees that if any distribution of this
Warrant or Warrant Shares is proposed to be made by them otherwise
than by delivery of a prospectus meeting the requirements of
Section 10 of the Act, such action shall be taken only after
receipt by the Company of an opinion of counsel reasonably
satisfactory to the Company, to the effect that the proposed
distribution will not be in violation of the Act or of applicable
state law. Furthermore, it shall be a condition to the transfer of
this Warrant that any transferee thereof deliver to the Company his
or its written agreement to accept and be bound by all of the terms
and conditions contained in this Warrant Certificate.
6.2 By acceptance hereof, the Holder represents and warrants
that this Warrant Certificate is being acquired, and all Warrant
Shares to be purchased upon the exercise of this Warrant
Certificate will be acquired, by the Holder solely for the account
of the Holder and not with a view to the fractionalization and
distribution thereof, and will not be sold or transferred except in
accordance with the applicable provisions of the Act and the rules
and regulations promulgated thereunder, and the Holder agrees that
neither this Warrant Certificate nor any of the Warrant Shares may
be sold or transferred except under cover of a registration
statement under the Act which is effective and current with respect
to such Warrant Shares or pursuant to an opinion of counsel
reasonably satisfactory to the Company that registration under the
Act is not required in connection with such sale or transfer. Any
Warrant Shares issued upon exercise of this Warrant shall bear a
legend to the following effect:
The securities represented by this certificate
have not been registered under the Securities
Act of 1933, as amended (the "Act"), or
qualified under applicable state securities
laws, and are restricted securities within the
meaning of the Act. Such securities may not
be sold or transferred, except pursuant to a
registration statement under such Act and
qualification under applicable state
securities laws or pursuant to an opinion of
counsel reasonably satisfactory to the issuer
of such securities that registration and
qualification are not required under
applicable federal or state securities laws or
an exemption is available therefrom.
7. Warrant Holder Not Shareholder. This Warrant Certificate
shall not confer upon the Holder any right to vote the Warrant
Shares or to consent to or receive notice as a shareholder of the
Company or any other rights as a shareholder of the Company because
of this Warrant Certificate.
8. Registration Rights.
8.1 Subject to the terms of this Section 8, the Holder of
this Warrant shall have the right to include all of the Warrant
Shares after as part of any registration of securities filed by the
Company (other than in connection with a transaction contemplated
-6-
<PAGE>
by Rule 145(a) promulgated under the Act or the registration of
securities on Form S-4 or Form S-8), and the Holder of this Warrant
must be notified in writing of such filing. The Holder shall have
five (5) business days to notify the Company in writing as to
whether the Company is to include the Warrant Shares as part of the
registration; provided, however, that if any registration pursuant
to this Section shall be underwritten, in whole or in part, the
Company may require that the Warrant Shares requested for inclusion
pursuant to this Section be included in the underwriting on the
same terms and conditions as the securities otherwise being sold
through the underwriters. If in the good faith judgment of the
underwriter of such offering only a limited number of Warrant
Shares should be included in such offering, or no such shares
should be included, the Holder of such Warrant Shares, and any
other selling shareholders, shall be reduced, such reduction to be
applied by excluding (on a pro rata basis) Warrant Shares proposed
to be sold by the Holder of this Warrant and shares proposed to be
sold by all other selling shareholders. Those Warrant Shares (and
all other shares of Common Stock held by the selling shareholders)
which are not included in an underwritten offering pursuant to the
foregoing provisions of this Section shall be withheld from the
market by the holders thereof for a period, not to exceed one
hundred and twenty (120) days, which the underwriter may reasonably
determine is necessary in order to effect such underwritten
offering, and the Holder shall sign any agreement to this effect
requested by such underwriter. Notwithstanding the foregoing
provisions, the Company may withdraw any registration statement
without incurring any liability to the Holder of Warrant Shares.
8.2 If the Company has not registered the Warrant Shares as
part of a registration of securities filed by the Company pursuant
to Section 8.1 hereof by December 1, 1998, then, in such event and
subject to the terms of this Section 8, at any time beginning after
December 1, 1998, and ending as of the termination of the Exercise
Period, at the written request of the Holder (whether or not the
Holder theretofore shall have exercised this Warrant in whole or in
part), and provided that (i) at the time of such request the Holder
is the owner of, and/or has the right pursuant to this Warrant to
purchase, Warrant Shares representing in the aggregate (either
alone or together with Warrant Shares theretofore purchased and/or
purchasable upon the exercise of this Warrant) more than 250,000 of
the total number of Warrant Shares theretofore issued and then
issuable upon the exercise of this Warrant or (ii) the Company has
not theretofore provided the Holder the opportunity to include
within the coverage of a registration statement, which registration
statement has been declared effective by the Securities and
Exchange Commission ("Commission"), all of the Warrant Shares
therefore issued and then issuable upon the exercise of this
Warrant pursuant to the provisions of Section 8.1 hereof or (iii)
the Holder is unable to sell all of the Warrant Shares without
registration under the Act pursuant to an exemption provided by the
Act, the Company promptly shall prepare and file with the
Commission a registration statement under the Act covering all of
the Warrant Shares theretofore issued and which thereafter may be
issuable upon the exercise of this Warrant (provided, that, if the
request for registration is received by the Company within forty-
five (45) days prior to the commencement of a fiscal year of the
Company, the Company may delay the preparation and filing of such
registration statement for a period of not more than one hundred
twenty (120) days following the commencement of such fiscal year in
order to prepare and include in such registration statement audited
financial statements for the immediately preceding fiscal year) and
shall use it reasonable efforts to cause such registration
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<PAGE>
statement to become effective as promptly as practical and to
remain effective and current with respect to the Warrant Shares
pursuant to Section 8.3 below. The right to demand the filing of
a registration statement pursuant to this Section 8.2 shall be
exercisable on one (1) occasion only.
8.3 The Company shall use reasonable efforts to keep
effective and current the registration statement filed by the
Company under either Section 8.1 or 8.2 hereof, which registration
statement has been declared effective by the Commission, with
respect to the Warrant Shares for an aggregate period ending upon
the earlier of (i) two (2) years after the termination of the
Exercise Period or the last exercise by the Holder of all of the
Warrant Shares, whichever occurs first, or (ii) the Holder is
permitted to sell or otherwise dispose of the Warrant Shares
acquired by the Holder upon exercise of this Warrant without
registration under the Act as a result of the provisions of Rule
144 (k) promulgated under the Act or a similar exemption from
registration under the Act, or (iii) the disposal or transfer of
all of the Warrant Shares by the Holder that are acquired by the
Holder.
8.4 Unless terminated sooner, the registration rights set
forth in Sections 8.1 and 8.2 above shall cease upon the earliest
of (a) the effective registration under the Act of all of the
Warrant Shares, (b) the disposal or transfer of such Warrant Shares
by the Holder, (c) registration under the Act is no longer required
for the immediate public distribution of such Warrant Shares as a
result of the provisions of Rule 144 promulgated under the Act, or
(d) such Warrant Shares cease to be outstanding.
8.5 Subject to the immediately following sentence, the
Company shall in all events pay and be responsible for all fees,
expenses, costs and disbursements associated with the registering
of the Warrant Shares under this Section 8, including filing fees,
fees, costs and disbursements of the Company's counsel, accountants
and other consultants representing the Company therewith.
Notwithstanding anything set forth herein to the contrary, Holder
shall be responsible for and shall pay any and all underwriting
discounts and commissions in connection with the sale of the
Warrant Shares pursuant to this Section 8 and all fees of its legal
counsel and other advisors retained by the Holder in connection
with reviewing any registration statement.
8.6 (i) The Company will indemnify and hold harmless the
Holder and its directors and officers and any underwriter (as
defined in the Act) for the Holder and each person, if any, who
controls the Holder or such underwriter within the meaning of the
Act, from and against, and will reimburse the Holder and each such
underwriter and controlling person with respect to, any and all
loss, damage, liability, cost and expense to which such Holder or
any such underwriter or controlling person may become subject under
the Act or otherwise, insofar as such losses, damages, liabilities,
costs or expenses are caused by any untrue statement or alleged
untrue statement of any material fact contained in such
registration statement referred to in Sections 8.1 or 8.2 of this
Warrant, any prospectus contained therein or any amendment or
supplement thereto, or arise out of, or are based upon, the
omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
-8-
<PAGE>
therein, in light of the circumstances in which they were made not
misleading; provided, however, that the Company will not be liable
in any such case to the extent that any such loss, damage,
liability, cost or expense arises out of, or is based upon, any
untrue statement or alleged untrue statement or alleged untrue
statement or omission or alleged omission so made in conformity
with information furnished by the Holder, such underwriter or such
controlling person in writing specifically for use in the
preparation thereof.
ii. The Holder will indemnify and hold harmless the Company,
its directors and officers, any controlling person and any
underwriter from and against, and will reimburse the Company, its
directors and officers, any controlling person and any underwriter
with respect to, any and all loss, damage, liability, cost or
expenses to which the Company or any controlling person and/or any
underwriter may become subject under the Act or otherwise, insofar
as such losses, damages, liabilities, costs or expenses are caused
by any untrue statement, or alleged untrue statement, of any
material fact contained in such registration statement referred to
in Sections 8.1 or 8.2 of this Warrant, any prospectus contained
therein or any amendment or supplement thereto, or arise out of, or
are based upon, the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances in which they
were made, not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement
or omission or alleged omission was so made in reliance upon, and
in strict conformity with, written information furnished by, or on
behalf of, the Holder specifically for use in the preparation
thereof.
9. Anti-Dilution.
9.1 If the Company at any time, or from time to time, while
this Warrant Certificate is outstanding shall declare or pay,
without consideration, any dividend on the Common Stock payable in
Common Stock or other securities of the Company, or shall effect a
subdivision of the outstanding shares of Common Stock into a
greater number of shares of Common Stock (by stock split,
reclassification or otherwise than by payment of a dividend in
Common Stock or other securities of the Company or in any right to
acquire Common Stock), or if the outstanding shares of Common Stock
shall be combined or consolidated, by reclassification or
otherwise, into a lesser number of shares of Common Stock, then the
number of shares of Common Stock issuable upon the exercise of this
Warrant Certificate or the Exercise Price shall be appropriately
adjusted such that immediately after the happening of any such
event, the proportionate number of shares of Common Stock issuable
immediately prior to the happening of such event shall be the
number of shares of Common Stock issuable subsequent to the
happening of such event.
9.2 In case of any consolidation or merger of the Company in
which the Company is not the surviving entity, or in case of any
sale or conveyance by the Company to another entity of all or
substantially all of the property of the Company as an entirety or
substantially as an entirety, the Holder shall have the right
thereafter, upon exercise of this Warrant, to receive the kind and
amount of securities, cash or other property which the Holder would
have owned or been entitled to receive immediately after such
consolidation, merger, sale or conveyance had this Warrant been
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<PAGE>
exercised in full immediately prior to the effective date of such
consolidation, merger, sale or conveyance, and in any such case, if
necessary, appropriate adjustment shall be made in the application
thereafter of the provisions of this Section 9 with respect to the
rights and interests of the Holder to the end that the provisions
of this Section 9 thereafter shall be correspondingly applicable,
as nearly as may be, to such securities and other property.
10. Redemption at Corporation's Option. At any time, and from
time to time, during the period beginning July 16, 1999 and ending
upon the termination of the Exercise Period, the Company may, at
its sole option, but shall not be obligated to, redeem this Warrant
at a redemption price of five cents ($.05) per Warrant Share
covered by this Warrant (the "Redemption Price"). The Company may
exercise its option to redeem this Warrant only if (a) the Warrant
Shares are covered by a registration statement filed with the
Commission which is effective as of the date of the Redemption
Notice (as defined below) and remains effective through the
Redemption Date (as defined below) and (b) the average closing bid
quotation of the Company's Common Stock as reported on the National
Association of Securities Dealers Automated Quotation system
("NASDAQ"), or the average closing price if listed on a national
securities exchange, for the ten (10) trading days immediately
prior to the date of the Redemption Notice (as defined below) is
$3.75 or more.
10.1 Mechanics of Redemption. Thirty (30) days prior to
any date stipulated by the Company for the redemption of this
Warrant (the "Redemption Date"), a written notice ("the Redemption
Notice") shall be mailed to each Holder of record. The Redemption
Notice shall state: (a) the Redemption Date of the Warrants, (b)
the number of Warrants to be redeemed from the Holder to whom the
redemption notice is addressed, (c) instructions for surrender to
the Company in the manner and at the place designated in this
Warrant Certificate to be redeemed from such Holder, and (d) as to
how to specify to the Company the number of Warrants to be
exercised into Warrant Shares, as provided in Sections 1 and 10.2
hereof.
10.2 Exercise Upon Redemption. Upon receipt of the
Redemption Notice, the Holder of this Warrant shall have the
option, at its sole election, to specify what portion of this
Warrant called for redemption in the Redemption Notice shall be
redeemed as provided in this Section 10 or exercised into Warrant
Shares in the manner provided in Section 1 hereof.
11. Notices. Except as otherwise specified herein to the
contrary, all notices, request, demands and other communications
required or desired to be given hereunder shall only be effective
if given in writing, by hand, by fax, by certified or registered
mail, return receipt requested, postage prepaid, or by U.S. Express
Mail service, or by private overnight mail services (e.g., Federal
Express). Any such notice shall be deemed to be have been given
(a) on the business day actually received if given by hand or by
fax, (b) on the business day immediately subsequent to mailing, if
sent by U.S. Express Mail service or private overnight mail
service, or (c) five (5) business days following the mailing
thereof, if mailed by certified or registered mail, postage
prepaid, return receipt requested, and all such notices shall be
-10-
<PAGE>
sent to the following addresses (or to such other address or
addresses as a party may have advised the other in the manner
provided in this Section 11):
If to the Company: Perma-Fix Environmental Services, Inc.
1940 Northwest 67th Place
Gainesville, Florida 32606-1649
Attention: Dr. Louis F. Centofanti
Chief Executive Officer
Fax No.: (352) 373-0040
with copies simultaneously Conner & Winters
by like means to: One Leadership Square, Suite 1700
211 North Robinson
Oklahoma City, Oklahoma 73102
Attention: Irwin H. Steinhorn, Esquire
Fax No.: (405) 232-2695
If to the Subscriber: Liviakis Financial Communications, Inc.
2420 K Street
Suite 220
Sacramento, CA 85816
Attention: John Liviakis, President
Fax No. (916) 448-6084
with copies simultaneously Kelly Lytton Mintz & Vann
by like means to: 1900 Avenue Of The Stars
Suite 1450
Los Angeles, California 70067
Attention: Allen Jacobsen, Esquire
Fax No. (310) 277-1804
12. Governing Law. This Warrant Certificate and all rights and
obligations hereunder shall be deemed to be made under and governed
by the laws of the State of Delaware without giving effect to such
State's conflict of laws provisions. The Company and the Holder
irrevocably consent to the venue and jurisdiction of the federal
court located in Wilmington, Delaware.
13. Successors and Assigns. This Warrant Certificate shall be
binding upon and shall inure to the benefit of the parties hereto
and their respective successors and assigns.
14. Headings. The headings of various sections of this Warrant
Certificate have been inserted for reference only and shall not be
a part of this Agreement.
-11-
<PAGE>
<PAGE>
IN WITNESS WHEREOF, the Company has caused this Warrant
Certificate to be duly executed, manually or by facsimile, by one
of its officers thereunto duly authorized.
Dated as of June 30, 1998
PERMA-FIX ENVIRONMENTAL
SERVICES, INC.
By /s/ Louis F. Centofanti
____________________________________
Dr. Louis F. Centofanti
Chief Executive Officer
-12-
<PAGE>
<PAGE>
ELECTION TO PURCHASE
To be Executed by the Holder in Order to Exercise the Common
Stock Purchase Warrant Certificate.
The undersigned Holder hereby irrevocable elects to purchase
__________________________________ of the Warrant Shares
represented by this Warrant Certificate, and to purchase the shares
of Common Stock issuable upon such exercise and requests that
certificates for securities be issued in the name of:
_______________________________________
(Please type or print name and address)
_______________________________________
_______________________________________
_______________________________________
(Social Security Number)
And delivered to
______________________________________
(Please type or print name and address)
and, if such number of Warrant Shares to be purchases shall not be
for all the Warrant Shares evidenced by this Warrant Certificate,
that a new Common Stock Warrant Certificate for the balance of such
Warrant Shares to be registered in the name of, and delivered to,
the Holder at the address below, as provided in the Warrant.
The undersigned Holder hereby irrevocable elects to pay for
the above referenced Warrant Shares pursuant to (check one):
[ ] Section 1.1(a) of this Warrant, or
[ ] Section 1.1(b) of this Warrant.
Dated:_____________________ _____________________________________
(Signature of Holder)
_____________________________________
(Address)
_____________________________________
_____________________________________
(Social Security or Federal I.D. Number)
_____________________________________
(Signature(s) guaranteed
NEITHER THIS WARRANT NOR ANY SHARES OF COMMON STOCK ISSUABLE UPON
THE EXERCISE OF THIS WARRANT HAVE BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR
QUALIFIED UNDER APPLICABLE STATE SECURITIES LAWS. THIS WARRANT AND
THE COMMON STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT BE
OFFERED, SOLD, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED IN
THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AND
QUALIFICATION IN EFFECT WITH RESPECT THERETO UNDER THE SECURITIES
ACT AND UNDER ANY APPLICABLE STATE SECURITIES LAW OR AN OPINION OF
COUNSEL THAT IS SATISFACTORY TO PERMA-FIX ENVIRONMENTAL SERVICES
INC. THAT SUCH REGISTRATION AND QUALIFICATION IS NOT REQUIRED UNDER
APPLICABLE FEDERAL AND STATE SECURITIES LAWS OR AN EXEMPTION
THEREFROM.
NOTWITHSTANDING THE FOREGOING, THE SHARES OF COMMON STOCK ISSUABLE
UPON EXERCISE OF THIS WARRANT ARE SUBJECT TO THE REGISTRATION
RIGHTS SET FORTH HEREIN.
No. LFC: 6-30-98-2
COMMON STOCK PURCHASE WARRANT CERTIFICATE
Dated: June 30, 1998
Six Hundred Twenty-Five Thousand(625,000) Warrants
to Purchase Six Hundred Twenty-Five Thousand
(625,000)
Shares of Perma-Fix Environmental Services, Inc.
Common Stock, $.001 Par Value Per Share
VOID AFTER 5:00 P.M., UNITED STATES EASTERN DAYLIGHT SAVINGS TIME
on
June 29, 2002
PERMA-FIX ENVIRONMENTAL SERVICES, INC., a Delaware corporation
(the "Company"), hereby certifies that ROBERT B. PRAG, an
individual (the "Warrant Holder" or "Holder"), for value received,
is entitled to purchase from the Company at any time after January
15, 1999, until 5:00 p.m., Eastern Daylight Savings Time ("EST")on
June 29, 2002 ("the Exercise Period"), up to an aggregate of six
hundred twenty-five thousand (625,000) shares (the "Shares" or
<PAGE>
"Warrant Shares") of the Company's common stock, par value $.001
per share ("Common Stock"), at an exercise price equal to U. S.
$1.875 per share (the "Per Share Exercise Price").
1. Exercise of Warrant and Shareholder Approval.
1.1 In order to exercise this Common Stock Purchase
Warrant Certificate ("Warrant" or "Warrant Certificate"), in whole
or in part, during the Exercise Period, the Holder shall deliver to
the Company this Warrant Certificate, with the attached Election to
Purchase form duly executed and completed by the Holder and
specifying the number of Warrant Shares which Holder is purchasing
pursuant to the terms of this Warrant, at 1940 Northwest 67th Place,
Gainesville, Florida 32606-1649, together with either:
(a) payment to the Company (in the form of cash or certified
or bank cashier's check payable to the Company) in an amount equal
to the Per Share Exercise Price multiplied by the number of Warrant
Shares being purchased (the"Aggregate Exercise Price"), or
(b) Holder's written direction to the Company to retain as
the Aggregate Exercise Price for the Warrant Shares being purchased
that number of the Warrant Shares (rounded upward to next highest
full Share) being purchased which have an aggregate value equal to
the Aggregate Exercise Price. Such Warrant Shares shall be valued
for such purposes at the highest closing price of the Company's
Common Stock in the principal market in which the Company's Common
Stock trade for a five day period consisting of the trading day
preceding the date on which this Warrant and the Purchase Form are
delivered to the Company plus the four preceding trading days.
As soon as practicable thereafter, but in any event within ten
(10) business days after the Company's receipt of all of the above
documents, the Company shall cause to be delivered to the Holder a
certificate issued in the Holder's name evidencing (x) in the case
payment of the exercise price pursuant to (a) above the full number
of Warrant Shares as to which this Warrant was exercised by the
Holder or (y) in the case of payment of the exercise price pursuant
to (b) above the number of Warrant Shares remaining after
subtracting from the full number of Warrant Shares as to which this
Warrant was exercised by Holder that number of Warrant Shares which
the Company is to retain pursuant to (b) above. Holder shall be
considered to be the holder and owner of the Warrant Shares to be
evidenced by such certificate as of the close of business on the
date the Company received the notice of exercise accompanied by
payment, as contemplated herein, without regarding to the date of
actual issuance of the certificate representing such Shares.
All or less than all of the Warrant Shares represented by this
Certificate may be exercised and, in case of the exercise of less
than all, the Company, upon surrender hereof, will deliver to the
Holder a new Warrant Certificate of like tenor and dated the date
hereof entitling said Holder to purchase the number of Warrant
Shares represented by this Warrant which have not been exercised
and to receive the Registration Rights set forth in Section 8 below
(to the extent such rights have not already been exercised) with
respect to such Warrant Shares which have not been exercised.
-2-
<PAGE>
1.2 In connection with the transactions pursuant to which
the Company is issuing this Warrant, the Company is also issuing
(i) to RBB Bank Aktiengesellschaft ("RBB Bank") certain shares of
a new series of Preferred Stock designated as Series 10 Class J
Convertible Preferred Stock ("Preferred Stock"), which Preferred
Stock is convertible into the Company's Common Stock pursuant to
the terms thereof, and certain warrants to RBB Bank for the
purchase by RBB Bank of up to 125,000 shares of Common Stock ("RBB
Warrants") pursuant to the terms of that certain Private Securities
Subscription Agreement, dated June 30, 1998 between the Company and
RBB Bank ("RBB Subscription Agreement"), and (ii) a certain warrant
to Robert B. Prag (collectively the "Prag Warrant") providing for
the purchase of up to an aggregate of 625,000 shares of Common
Stock pursuant to the terms of that certain Placement and
Consulting Agreement, dated June 30, 1998 between the Corporation
and the Holder ("Liviakis Consulting Agreement").
If (i) the aggregate number of shares of Common Stock issued
by the Company as a result of (a) conversion of the Preferred
Stock, (b) payment of dividends accrued on the Preferred Stock, (c)
exercise of the RBB Warrants (d) exercise of this Warrant and (e)
exercise of the Prag Warrant exceeds 2,388,347 shares of Common
Stock (which equals 19.9% of the outstanding shares of Common Stock
of the Company as of the date of this Warrant) and (ii) RBB Bank
has converted or elects to convert any of the then outstanding
shares of Preferred Stock pursuant to the terms of the Preferred
Stock at a Conversion Price (as defined in the terms of the
Preferred Stock) less than $1.875 ($1.875 being the market value
per share of Common Stock as quoted on the NASDAQ as of the close
of business on June 30, 1998), other than if the Conversion Price
is less than $1.875 solely as a result of the anti-dilution
provisions of the Preferred Stock, then, notwithstanding anything
in this Warrant to the contrary, thereafter the Company shall not
issue any shares of Common Stock as a result of the exercise of
this Warrant unless and until the Company shall have obtained
approval of its shareholders entitled to vote on the transactions
referenced to in the RBB Subscription Agreement and the Liviakis
Consulting Agreement pursuant to requirements of subparagraphs
(25)(H)(i)d, (iv) and (v) of Rule 4310 of the NASDAQ Marketplace
Rules ("Shareholder Approval").
If Shareholder Approval is required as set forth in the above
paragraph, the Company shall take all practicable steps to obtain
such Shareholder Approval within ninety (90) days of the event
triggering the need for Shareholder Approval (the "90 Day Period").
The Holder shall, and the Company shall use its best efforts to
cause its officers and directors to, vote all shares of Common
Stock of the Company over which they have voting control in favor
of such Shareholder Approval. If the Company is required to obtain
such Shareholder Approval pursuant to the requirements of the above
paragraph but is unable to obtain such Shareholder Approval within
the 90 Day Period, then, the Company agrees that the Exercise
Period shall be extended for that number of additional days equal
to the number of days in the period of time beginning with the day
after the expiration of the 90 Day Period and ending as of the day
such Shareholder Approval is obtained.
-3-
<PAGE>
In addition, if the Company is required to obtain such
Shareholder Approval within the 90 Day Period but is unable to
obtain such Shareholder Approval within such 90 Day Period and
thereafter the Holder notifies the Company in writing of its
intention to exercise this Warrant for all or a portion of the
Warrant Shares pursuant to the requirements of this Warrant
("Notification of Intention") before such Shareholder Approval is
obtained, with such Notification of Intention specifying the exact
number of Warrant Shares that the Holder intends to purchase
("Warrant Shares to be Purchased") pursuant to the requirements of
this Warrant, then the Company shall have an additional sixty (60)
days ("Additional 60 Days") from receipt by the Company from the
Holder of such Notification of Intention. If the Company has not
obtained the Shareholder Approval within the Additional 60 Days,
then the Holder shall have the option to terminate this Warrant as
to the Warrant Shares to be Purchased, and, in the event of such
termination, the Company shall pay to the Holder an amount
("Payment Amount") determined by subtracting from (a) an amount
determined by multiplying the fair market value (as defined below)
per share of Common Stock by the number of Warrant Shares to be
Purchased, (b) the Aggregate Exercise Price of the Warrant Shares
to be Purchased. If the Holder elects to terminate this Warrant as
to the Warrant Shares to be Purchased for the Payment Amount
pursuant to the terms of this paragraph ("Election"), the Holder
shall deliver to the Company written notice ("Election Notice") of
the Election, and the Company shall have fifteen (15) days from
receipt of such Election Notice to pay the Payment Amount to the
Holder either in cash or by delivering to the Holder the Company's
promissory note payable to the order of the Holder in the principal
amount of the Payment Amount. If the Company elects to pay the
Payment Amount by delivery to the Holder such promissory note, such
promissory note shall be in the principal amount of the Payment
Amount and shall bear an annual rate of interest equal to the prime
rate announced from time to time by the Chase Manhattan Bank plus
1%, with the principal payable in thirty-six (36) equal monthly
installments plus accrued and unpaid interest, and the first
monthly installment beginning the first full month after issuance
of such promissory note. Such promissory note shall be in form
reasonably satisfactory to the Holder. For the purpose of this
paragraph, "fair market value" per share of the Company's Common
Stock shall be the average closing price of a share of the
Company's Common Stock as reported on the National Association of
Securities Dealers Automated Quotation System ("NASDAQ"), or if the
Common Stock is not listed on the NASDAQ but is listed for trading
on a national securities exchange the average closing price of a
share of Common Stock as reported on such national securities
exchange, for the five (5) trading days immediately prior to the
Company's receipt of the Election Notice from the Holder of the
documents required by Section 1.1 hereof in connection with the
exercise of the Warrant Shares to be Purchased. Notwithstanding
anything herein to the contrary, this Warrant as to the Warrant
Shares to be Purchased shall terminate in all respects as of the
date of receipt by the Company of the Holder's Election Notice.
2. Exchange and Transfer. This Warrant Certificate, at any time
prior to the exercise hereof, upon presentation and surrender to
the Company, may be exchanged, alone or with other certificates of
like tenor registered in the name of the same Holder, for another
Certificate of like tenor in the name of such Holder exercisable
for the aggregate number of Warrant Shares as the Warrant
Certificate surrendered.
-4-
3. Rights and Obligations of Holder of this Certificate. The
Holder of this Warrant Certificate shall not, by virtue hereof, be
entitled to any rights of a shareholder in the Company, either at
law or in equity; provided, however, that in the event any shares
of Common Stock are issued to the Holder hereof upon exercise of
some or all of the Warrants evidenced by this Warrant Certificate,
such Holder shall, for all purposes, be deemed to have become the
holder of record of such Common Stock on the date on which this
Warrant Certificate and a duly executed Election to Purchase form
were surrendered and payment of the Aggregate Exercise Price was
made pursuant to the terms hereof, irrespective of the date of
delivery of such share certificate. The rights of the Holder of
this Warrant Certificate are limited to those expressed herein and
the Holder of this Warrant Certificate, by his acceptance hereof,
consents and agrees to be bound by, and to comply with, all of the
provisions of this Warrant Certificate, including, without
limitation, all of the obligations imposed upon the Holder
contained in this Warrant Certificate. In addition, the Holder, by
accepting this Warrant Certificate, agrees that the Company may
deem and treat the person in whose name this Warrant Certificate is
registered on the books of the Company as the absolute, true and
lawful owner of this Warrant Certificate for all purposes
whatsoever, and the Company shall not be affected by any notice to
the contrary.
4. Common Stock.
4.1 The Company covenants and agrees that all shares of
Common Stock which may be acquired by the Holder under this Warrant
Certificate will, when issued pursuant to the terms of this Warrant
and upon delivery, be duly and validly authorized and issued, fully
paid and nonassessable, and free from all stamp taxes, liens, and
charges with respect to the purchase thereof.
4.2 The Company covenants and agrees that it will, at all
times, reserve and keep available an authorized number of shares of
its Common Stock and other applicable securities sufficient to
permit the exercise in full of all outstanding options, warrants
and rights, including this Warrant.
5. No Fractional Shares. No Fractional Shares or scrip
representing Fractional Shares shall be issued upon the exercise of
this Warrant. Fractional shares shall be rounded down to the
nearest whole share of Common Stock.
6. Disposition of Warrant or Shares.
6.1 The Holder of this Warrant Certificate, by his
acceptance thereof, agrees that (a) no public distribution of this
Warrant or Warrant Shares will be made in violation of the
provisions of the Securities Act of 1933, as amended, and the Rules
and Regulations promulgated thereunder (collectively, the "Act"),
and (b) during such period as delivery of a prospectus with respect
to this Warrant or Warrant Shares may be required by the Act, no
public distribution of this Warrant or Warrant Shares will be made
in a manner or on terms different from those set forth in, or
without delivery of, a prospectus then meeting the requirements of
-5-
<PAGE>
Section 10 of the Act and in compliance with all applicable state
securities laws. The Holder of this Warrant Certificate and each
transferee hereof further agrees that if any distribution of this
Warrant or Warrant Shares is proposed to be made by them otherwise
than by delivery of a prospectus meeting the requirements of
Section 10 of the Act, such action shall be taken only after
receipt by the Company of an opinion of counsel reasonably
satisfactory to the Company, to the effect that the proposed
distribution will not be in violation of the Act or of applicable
state law. Furthermore, it shall be a condition to the transfer of
this Warrant that any transferee thereof deliver to the Company his
or its written agreement to accept and be bound by all of the terms
and conditions contained in this Warrant Certificate.
6.2 By acceptance hereof, the Holder represents and warrants
that this Warrant Certificate is being acquired, and all Warrant
Shares to be purchased upon the exercise of this Warrant
Certificate will be acquired, by the Holder solely for the account
of the Holder and not with a view to the fractionalization and
distribution thereof, and will not be sold or transferred except in
accordance with the applicable provisions of the Act and the rules
and regulations promulgated thereunder, and the Holder agrees that
neither this Warrant Certificate nor any of the Warrant Shares may
be sold or transferred except under cover of a registration
statement under the Act which is effective and current with respect
to such Warrant Shares or pursuant to an opinion of counsel
reasonably satisfactory to the Company that registration under the
Act is not required in connection with such sale or transfer. Any
Warrant Shares issued upon exercise of this Warrant shall bear a
legend to the following effect:
The securities represented by this certificate
have not been registered under the Securities
Act of 1933, as amended (the "Act"), or
qualified under applicable state securities
laws, and are restricted securities within the
meaning of the Act. Such securities may not
be sold or transferred, except pursuant to a
registration statement under such Act and
qualification under applicable state
securities laws or pursuant to an opinion of
counsel reasonably satisfactory to the issuer
of such securities that registration and
qualification are not required under
applicable federal or state securities laws or
an exemption is available therefrom.
7. Warrant Holder Not Shareholder. This Warrant Certificate
shall not confer upon the Holder any right to vote the Warrant
Shares or to consent to or receive notice as a shareholder of the
Company or any other rights as a shareholder of the Company because
of this Warrant Certificate.
8. Registration Rights.
8.1 Subject to the terms of this Section 8, the Holder of
this Warrant shall have the right to include all of the Warrant
Shares after as part of any registration of securities filed by the
Company (other than in connection with a transaction contemplated
-6-
<PAGE>
by Rule 145(a) promulgated under the Act or the registration of
securities on Form S-4 or Form S-8), and the Holder of this Warrant
must be notified in writing of such filing. The Holder shall have
five (5) business days to notify the Company in writing as to
whether the Company is to include the Warrant Shares as part of the
registration; provided, however, that if any registration pursuant
to this Section shall be underwritten, in whole or in part, the
Company may require that the Warrant Shares requested for inclusion
pursuant to this Section be included in the underwriting on the
same terms and conditions as the securities otherwise being sold
through the underwriters. If in the good faith judgment of the
underwriter of such offering only a limited number of Warrant
Shares should be included in such offering, or no such shares
should be included, the Holder of such Warrant Shares, and any
other selling shareholders, shall be reduced, such reduction to be
applied by excluding (on a pro rata basis) Warrant Shares proposed
to be sold by the Holder of this Warrant and shares proposed to be
sold by all other selling shareholders. Those Warrant Shares (and
all other shares of Common Stock held by the selling shareholders)
which are not included in an underwritten offering pursuant to the
foregoing provisions of this Section shall be withheld from the
market by the holders thereof for a period, not to exceed one
hundred and twenty (120) days, which the underwriter may reasonably
determine is necessary in order to effect such underwritten
offering, and the Holder shall sign any agreement to this effect
requested by such underwriter. Notwithstanding the foregoing
provisions, the Company may withdraw any registration statement
without incurring any liability to the Holder of Warrant Shares.
8.2 If the Company has not registered the Warrant Shares as
part of a registration of securities filed by the Company pursuant
to Section 8.1 hereof by December 1, 1998, then, in such event and
subject to the terms of this Section 8, at any time beginning after
December 1, 1998, and ending as of the termination of the Exercise
Period, at the written request of the Holder (whether or not the
Holder theretofore shall have exercised this Warrant in whole or in
part), and provided that (i) at the time of such request the Holder
is the owner of, and/or has the right pursuant to this Warrant to
purchase, Warrant Shares representing in the aggregate (either
alone or together with Warrant Shares theretofore purchased and/or
purchasable upon the exercise of this Warrant) more than 250,000 of
the total number of Warrant Shares theretofore issued and then
issuable upon the exercise of this Warrant or (ii) the Company has
not theretofore provided the Holder the opportunity to include
within the coverage of a registration statement, which registration
statement has been declared effective by the Securities and
Exchange Commission ("Commission"), all of the Warrant Shares
therefore issued and then issuable upon the exercise of this
Warrant pursuant to the provisions of Section 8.1 hereof or (iii)
the Holder is unable to sell all of the Warrant Shares without
registration under the Act pursuant to an exemption provided by the
Act, the Company promptly shall prepare and file with the
Commission a registration statement under the Act covering all of
the Warrant Shares theretofore issued and which thereafter may be
issuable upon the exercise of this Warrant (provided, that, if the
request for registration is received by the Company within forty-
five (45) days prior to the commencement of a fiscal year of the
Company, the Company may delay the preparation and filing of such
registration statement for a period of not more than one hundred
twenty (120) days following the commencement of such fiscal year in
order to prepare and include in such registration statement audited
financial statements for the immediately preceding fiscal year) and
shall use it reasonable efforts to cause such registration
-7-
<PAGE>
statement to become effective as promptly as practical and to
remain effective and current with respect to the Warrant Shares
pursuant to Section 8.3 below. The right to demand the filing of
a registration statement pursuant to this Section 8.2 shall be
exercisable on one (1) occasion only.
8.3 The Company shall use reasonable efforts to keep
effective and current the registration statement filed by the
Company under either Section 8.1 or 8.2 hereof, which registration
statement has been declared effective by the Commission, with
respect to the Warrant Shares for an aggregate period ending upon
the earlier of (i) two (2) years after the termination of the
Exercise Period or the last exercise by the Holder of all of the
Warrant Shares, whichever occurs first, or (ii) the Holder is
permitted to sell or otherwise dispose of the Warrant Shares
acquired by the Holder upon exercise of this Warrant without
registration under the Act as a result of the provisions of Rule
144 (k) promulgated under the Act or a similar exemption from
registration under the Act, or (iii) the disposal or transfer of
all of the Warrant Shares by the Holder that are acquired by the
Holder.
8.4 Unless terminated sooner, the registration rights set
forth in Sections 8.1 and 8.2 above shall cease upon the earliest
of (a) the effective registration under the Act of all of the
Warrant Shares, (b) the disposal or transfer of such Warrant Shares
by the Holder, (c) registration under the Act is no longer required
for the immediate public distribution of such Warrant Shares as a
result of the provisions of Rule 144 promulgated under the Act, or
(d) such Warrant Shares cease to be outstanding.
8.5 Subject to the immediately following sentence, the
Company shall in all events pay and be responsible for all fees,
expenses, costs and disbursements associated with the registering
of the Warrant Shares under this Section 8, including filing fees,
fees, costs and disbursements of the Company's counsel, accountants
and other consultants representing the Company therewith.
Notwithstanding anything set forth herein to the contrary, Holder
shall be responsible for and shall pay any and all underwriting
discounts and commissions in connection with the sale of the
Warrant Shares pursuant to this Section 8 and all fees of its legal
counsel and other advisors retained by the Holder in connection
with reviewing any registration statement.
8.6 (i) The Company will indemnify and hold harmless the
Holder and its directors and officers and any underwriter (as
defined in the Act) for the Holder and each person, if any, who
controls the Holder or such underwriter within the meaning of the
Act, from and against, and will reimburse the Holder and each such
underwriter and controlling person with respect to, any and all
loss, damage, liability, cost and expense to which such Holder or
any such underwriter or controlling person may become subject under
the Act or otherwise, insofar as such losses, damages, liabilities,
costs or expenses are caused by any untrue statement or alleged
untrue statement of any material fact contained in such
registration statement referred to in Sections 8.1 or 8.2 of this
Warrant, any prospectus contained therein or any amendment or
supplement thereto, or arise out of, or are based upon, the
omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
-8-
<PAGE>
therein, in light of the circumstances in which they were made not
misleading; provided, however, that the Company will not be liable
in any such case to the extent that any such loss, damage,
liability, cost or expense arises out of, or is based upon, any
untrue statement or alleged untrue statement or alleged untrue
statement or omission or alleged omission so made in conformity
with information furnished by the Holder, such underwriter or such
controlling person in writing specifically for use in the
preparation thereof.
ii. The Holder will indemnify and hold harmless the Company,
its directors and officers, any controlling person and any
underwriter from and against, and will reimburse the Company, its
directors and officers, any controlling person and any underwriter
with respect to, any and all loss, damage, liability, cost or
expenses to which the Company or any controlling person and/or any
underwriter may become subject under the Act or otherwise, insofar
as such losses, damages, liabilities, costs or expenses are caused
by any untrue statement, or alleged untrue statement, of any
material fact contained in such registration statement referred to
in Sections 8.1 or 8.2 of this Warrant, any prospectus contained
therein or any amendment or supplement thereto, or arise out of, or
are based upon, the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances in which they
were made, not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement
or omission or alleged omission was so made in reliance upon, and
in strict conformity with, written information furnished by, or on
behalf of, the Holder specifically for use in the preparation
thereof.
9. Anti-Dilution.
9.1 If the Company at any time, or from time to time, while
this Warrant Certificate is outstanding shall declare or pay,
without consideration, any dividend on the Common Stock payable in
Common Stock or other securities of the Company, or shall effect a
subdivision of the outstanding shares of Common Stock into a
greater number of shares of Common Stock (by stock split,
reclassification or otherwise than by payment of a dividend in
Common Stock or other securities of the Company or in any right to
acquire Common Stock), or if the outstanding shares of Common Stock
shall be combined or consolidated, by reclassification or
otherwise, into a lesser number of shares of Common Stock, then the
number of shares of Common Stock issuable upon the exercise of this
Warrant Certificate or the Exercise Price shall be appropriately
adjusted such that immediately after the happening of any such
event, the proportionate number of shares of Common Stock issuable
immediately prior to the happening of such event shall be the
number of shares of Common Stock issuable subsequent to the
happening of such event.
9.2 In case of any consolidation or merger of the Company in
which the Company is not the surviving entity, or in case of any
sale or conveyance by the Company to another entity of all or
substantially all of the property of the Company as an entirety or
substantially as an entirety, the Holder shall have the right
thereafter, upon exercise of this Warrant, to receive the kind and
amount of securities, cash or other property which the Holder would
have owned or been entitled to receive immediately after such
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consolidation, merger, sale or conveyance had this Warrant been
exercised in full immediately prior to the effective date of such
consolidation, merger, sale or conveyance, and in any such case, if
necessary, appropriate adjustment shall be made in the application
thereafter of the provisions of this Section 9 with respect to the
rights and interests of the Holder to the end that the provisions
of this Section 9 thereafter shall be correspondingly applicable,
as nearly as may be, to such securities and other property.
10. Redemption at Corporation's Option. At any time, and from
time to time, during the period beginning July 16, 1999 and ending
upon the termination of the Exercise Period, the Company may, at
its sole option, but shall not be obligated to, redeem this Warrant
at a redemption price of five cents ($.05) per Warrant Share
covered by this Warrant (the "Redemption Price"). The Company may
exercise its option to redeem this Warrant only if (a) the Warrant
Shares are covered by a registration statement filed with the
Commission which is effective as of the date of the Redemption
Notice (as defined below) and remains effective through the
Redemption Date (as defined below) and (b) the average closing bid
quotation of the Company's Common Stock as reported on the National
Association of Securities Dealers Automated Quotation system
("NASDAQ"), or the average closing price if listed on a national
securities exchange, for the ten (10) trading days immediately
prior to the date of the Redemption Notice (as defined below) is
$3.75 or more.
10.1 Mechanics of Redemption. Thirty (30) days prior to
any date stipulated by the Company for the redemption of this
Warrant (the "Redemption Date"), a written notice ("the Redemption
Notice") shall be mailed to each Holder of record. The Redemption
Notice shall state: (a) the Redemption Date of the Warrants, (b)
the number of Warrants to be redeemed from the Holder to whom the
redemption notice is addressed, (c) instructions for surrender to
the Company in the manner and at the place designated in this
Warrant Certificate to be redeemed from such Holder, and (d) as to
how to specify to the Company the number of Warrants to be
exercised into Warrant Shares, as provided in Sections 1 and 10.2
hereof.
10.2 Exercise Upon Redemption. Upon receipt of the
Redemption Notice, the Holder of this Warrant shall have the
option, at its sole election, to specify what portion of this
Warrant called for redemption in the Redemption Notice shall be
redeemed as provided in this Section 10 or exercised into Warrant
Shares in the manner provided in Section 1 hereof.
11. Notices. Except as otherwise specified herein to the
contrary, all notices, request, demands and other communications
required or desired to be given hereunder shall only be effective
if given in writing, by hand, by fax, by certified or registered
mail, return receipt requested, postage prepaid, or by U.S. Express
Mail service, or by private overnight mail services (e.g., Federal
Express). Any such notice shall be deemed to be have been given
(a) on the business day actually received if given by hand or by
fax, (b) on the business day immediately subsequent to mailing, if
sent by U.S. Express Mail service or private overnight mail
service, or (c) five (5) business days following the mailing
thereof, if mailed by certified or registered mail, postage
prepaid, return receipt requested, and all such notices shall be
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sent to the following addresses (or to such other address or
addresses as a party may have advised the other in the manner
provided in this Section 11):
If to the Company: Perma-Fix Environmental Services, Inc.
1940 Northwest 67th Place
Gainesville, Florida 32606-1649
Attention: Dr. Louis F. Centofanti
Chief Executive Officer
Fax No.: (352) 373-0040
with copies simultaneously Conner & Winters
by like means to: One Leadership Square, Suite 1700
211 North Robinson
Oklahoma City, Oklahoma 73102
Attention: Irwin H. Steinhorn, Esquire
Fax No.: (405) 232-2695
If to the Holder: Robert B. Prag
2420 K Street
Suite 220
Sacramento, CA 85816
Fax No. (916) 448-6084
with copies simultaneously Kelly Lytton Mintz & Vann
by like means to: 1900 Avenue Of The Stars
Suite 1450
Los Angeles, California 70067
Attention: Allen Jacobsen, Esquire
Fax No. (310) 277-1804
12. Governing Law. This Warrant Certificate and all rights and
obligations hereunder shall be deemed to be made under and governed
by the laws of the State of Delaware without giving effect to such
State's conflict of laws provisions. The Company and the Holder
irrevocably consent to the venue and jurisdiction of the federal
court located in Wilmington, Delaware.
13. Binding Effect. This Warrant Certificate shall be binding
upon and shall inure to the benefit of the parties hereto and their
respective successors, permitted assigns, heirs, executors and
administrators.
14. Headings. The headings of various sections of this Warrant
Certificate have been inserted for reference only and shall not be
a part of this Agreement.
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<PAGE>
IN WITNESS WHEREOF, the Company has caused this Warrant
Certificate to be duly executed, manually or by facsimile, by one
of its officers thereunto duly authorized.
Dated as of June 30, 1998
PERMA-FIX ENVIRONMENTAL
SERVICES, INC.
By /s/ Louis F. Centofanti
____________________________________
Dr. Louis F. Centofanti
Chief Executive Officer
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<PAGE>
ELECTION TO PURCHASE
To be Executed by the Holder in Order to Exercise the Common
Stock Purchase Warrant Certificate.
The undersigned Holder hereby irrevocable elects to purchase
_______________________________________ of the Warrant Shares
represented by this Warrant Certificate, and to purchase the shares
of Common Stock issuable upon such exercise and requests that
certificates for securities be issued in the name of:
______________________________________
(Please type or print name and address)
_______________________________________
_______________________________________
_______________________________________
(Social Security Number)
And delivered to
_______________________________________
(Please type or print name and address)
and, if such number of Warrant Shares to be purchases shall not be
for all the Warrant Shares evidenced by this Warrant Certificate,
that a new Common Stock Warrant Certificate for the balance of such
Warrant Shares to be registered in the name of, and delivered to,
the Holder at the address below, as provided in the Warrant.
The undersigned Holder hereby irrevocable elects to pay for
the above referenced Warrant Shares pursuant to (check one):
[ ] Section 1.1(a) of this Warrant, or
[ ] Section 1.1(b) of this Warrant.
Dated: _____________________ _____________________________________
(Signature of Holder)
______________________________________
(Address)
_______________________________________
_______________________________________
(Social Security or Federal I.D. Number)
_______________________________________
(Signature(s) guaranteed
