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txmd-8k_123112.htm
 
UNITED STATES
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): January 31, 2013

THERAPEUTICSMD, INC.
(Exact name of registrant as specified in its charter)
 
Nevada
000-16731
87-0233535
(State or other jurisdiction of incorporation)
 
(Commission File Number)
(IRS Employer Identification No.)

  951 Broken Sound Parkway NW, Suite 320, Boca Raton, FL  33487
 (Address of principal executive offices and Zip Code)
 
(561) 961-1911
 (Registrant’s telephone number, including area code)
 
N/A
(Former Name and Address of Registrant)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a -12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d -2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e -4(c))


 
 
 

 
Item 1.01.                      Entry into a Material Definitive Agreement.

On January 31, 2013, TherapeuticsMD, Inc., a Nevada corporation (the "Company"), issued a Multiple Advance Revolving Credit Note (the “Note”) to Plato and Associates, LLC, a Missouri limited liability company (“Plato”).  The Note allows the Company to draw down funding up to the $10 million maximum principal amount, at a stated interest rate of six percent per annum (the “Stated Interest Rate”). Plato may make advances to the Company from time to time under the Note at the request of the Company, which advances will be of a revolving nature and may be made, repaid, and made from time to time.  Interest payments shall be due and payable on the tenth day following the end of each calendar quarter in which any interest is accrued and unpaid, commencing on April 10, 2013, and the principal balance outstanding under the Note, together with all accrued interest and other amounts payable under the Note, if any, shall be due and payable on February 24, 2014.  The default interest rate under the Note shall be a per annum rate equal to the Stated Interest Rate plus eight percentage points (the “Default Interest Rate”), and the principal amount outstanding under the Note shall bear interest at the Default Interest Rate upon the occurrence of an event of default as specified in the Note, including, the Company’s nonpayment of amounts due under the Note or its failure to comply with any provision of the Note, among others.

As additional consideration for the Note, the Company issued to Plato a warrant (the “Warrant”) to purchase 1,250,000 shares of the Company’s common stock at an exercise price $3.20 per share. The Warrant will vest and become exercisable on October 31, 2013 and may be exercised any time after that date prior to the January 31, 2019 expiration date of the Warrant.

The foregoing is a summary only and does not purport to be a complete description of all of the terms contained in the Note and the Warrant, and is subject to and qualified in its entirety by reference to the full text of the Note and the Warrant, which are attached hereto as Exhibits 10.0 and 10.1, respectively, and are incorporated herein by reference.

Item 2.03.                      Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

Reference is made to Item 1.01 of this Current Report on Form 8-K regarding the Note.  Such disclosure contained in Item 1.01 regarding the Note and the information contained in Exhibit 10.0 attached hereto are hereby incorporated by reference in their entirety into this Item 2.03.

Item 3.02.                      Unregistered Sales of Equity Securities.

Reference is made to Item 1.01 of this Current Report on Form 8-K regarding the Warrant.  The disclosure contained in Item 1.01 regarding the Warrant and the information contained in Exhibit 10.1 attached hereto are hereby incorporated by reference in their entirety into this Item 3.02.

Item 9.01.                      Financial Statements and Exhibits.

(d)           Exhibits:
 
Exhibit
Number
Date
Document
     
10.0
January 31, 2013
10.1
January 31, 2013

 
 
 
 
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.
 
Date: February 6, 2013   
THERAPEUTICSMD, INC.
     
     
    
By:
/s/Robert G. Finizio
   
 
 Robert G. Finizio, Chief Executive Officer
 
 
 
ex10_0.htm
TherapeuticsMD, Inc. 8-K
 
Exhibit 10.0
 
MULTIPLE ADVANCE
REVOLVING CREDIT NOTE
 
U.S. $10,000,000.00  January 31, 2013
   Boca Raton, Florida
 
FOR VALUE RECEIVED, TherapeuticsMD, Inc., a Nevada corporation ("Borrower"), hereby promises to pay to the order of Plato & Associates, LLC, a Missouri limited liability company ("Lender"), at the office of Lender located at 13650 Fiddlesticks Blvd., Suite 202, Ft. Myers, FL  33912, the principal amount of $10,000,000.00, or such lesser principal amount as from time to time shall be outstanding hereunder, as reflected in the books and records of Lender, together with interest on the principal balance from time to time outstanding hereunder, from (and including) the date of disbursement until (but not including) the date of payment, at a per annum rate equal to the Stated Interest Rate specified below or, to the extent applicable, the Default Interest Rate specified below, in accordance with the following terms and conditions:
 
1.   Contracted Rate of Interest.  The contracted rate of interest on the indebtedness evidenced hereby, without limitation, shall consist of the following:
 
(a)   The Stated Interest Rate (as hereinafter defined), as from time to time in effect, calculated daily on the basis of actual days elapsed over a 365-day year, applied to the principal balance from time to time outstanding hereunder;
 
(b)   The Default Interest Rate (as hereinafter defined), as from time to time in effect, calculated daily on the basis of actual days elapsed over a 365-day year, applied to the principal balance from time to time outstanding hereunder; and
 
(c)   All Additional Sums (as hereinafter defined), if any.
 
Borrower agrees to pay an effective contracted rate of interest which is the sum of the Stated Interest Rate referred to in Subsection 1(a) above, plus any additional rate of interest resulting from the application of the Default Interest Rate referred to in Subsection 1(b) above.
 
2.   Stated Interest Rate.  Except as provided in Section 3 below, the principal balance outstanding hereunder from time to time shall bear interest at the Stated Interest Rate.  The Stated Interest Rate shall be 6% per annum.
 
3.   Default Interest Rate.  The Default Interest Rate shall be a per annum rate equal to the Stated Interest Rate plus eight percentage points.  The principal balance outstanding hereunder from time to time shall bear interest at the Default Interest Rate from the date of the occurrence of an Event of Default (as hereinafter defined) hereunder until the earlier of: (a) the date on which the principal balance outstanding hereunder, together with all accrued interest and other amounts payable hereunder, are paid in full; or (b) the date on which such Event of Default is timely cured in a manner satisfactory to Lender.
 
4.   Principal Balance.  The principal balance outstanding hereunder at any time shall be the total amount of advances made hereunder by Lender, less the total amount of payments of principal hereon, as reflected in the books and records of Lender with respect to the indebtedness evidenced hereby.  The principal balance outstanding hereunder at any time shall not exceed the principal amount first set forth above.
 
 
 
 
5.   Revolving Credit; No Commitment.  Lender may make advances to Borrower from time to time hereunder, which advances will be of a revolving nature and may be made, repaid, and made from time to time.  Borrower and Lender contemplate a series of discretionary advances as provided herein even if the principal balance outstanding hereunder has previously been reduced to zero.
 
6.   Requests for Advances.  Advances hereunder shall be deemed to be made to or for the benefit of Borrower and may be made by Lender from time to time upon the written request of the Chief Executive Officer or Chief Financial Officer of the Borrower.
 
7.   Payments.  This Note shall be payable as follows:

(a)   Interest.  Accrued and unpaid interest at the Stated Interest Rate or, to the extent applicable, the Default Interest Rate, shall be payable on the tenth day following the end of each calendar quarter in which any interest is accrued and unpaid, commencing on April 10, 2013.

(b)   Principal.  The principal balance outstanding hereunder, together with all accrued interest and other amounts payable hereunder, if not sooner paid as provided herein, shall be due and payable on February 24, 2014.
 
8.   Application of Payments.  Payments received by Lender with respect to the indebtedness evidenced hereby shall be applied in such order and manner as Lender in its sole and absolute discretion may elect.  Unless otherwise elected by Lender, all such payments shall first be applied to accrued and unpaid interest at the Stated Interest Rate and, to the extent applicable, the Default Interest Rate, next to the principal balance then outstanding hereunder, and the remainder to any additional sums or other costs or added charges provided for herein.  Payments hereunder shall be made at the address for Lender first set forth above or at such other address as Lender may specify to Borrower in writing.
 
9.   Prepayments.  Payments of principal hereof may be made at any time, or from time to time, in whole or in part, without penalty, provided that all interest and other charges accrued to the date of prepayment are also paid in full.  Notwithstanding any prepayment of principal hereof: (a) there will be no change in the due date or scheduled interest payments due hereunder unless Lender, in its sole and absolute discretion, agrees in writing to such change; and (b) Borrower’s obligations hereunder shall continue in effect, and this Note shall remain outstanding, unless and until (i) the principal balance outstanding hereunder, together with all accrued interest and other amounts payable hereunder, are paid in full, and (ii) thereafter, upon Borrower’s request, Lender delivers to Borrower the original executed copy of this Note, marked "Cancelled."
 
10.           Issuance of Warrant.  Simultaneously with the execution of this Note, Borrower shall deliver to Lender, and/or its assigns, a Common Stock Purchase Warrant(s) ("Warrant(s)"), substantially in the form attached hereto as Exhibit A, providing Lender, and/or its assigns, with the right to purchase 1,250,000 fully paid and non-assessable shares of common stock of the Borrower (the "Warrant Shares") at an exercise price of $3.20 per share.
 
11.           Events of Default; Acceleration.  The occurrence of any one or more of the following events shall constitute an "Event of Default" hereunder, and upon such Event of Default, the entire principal balance outstanding hereunder, together with all accrued interest and other amounts payable hereunder, at the election of Lender, shall become immediately due and payable, without any notice to Borrower:
 
(a)   Nonpayment of principal, interest or other amounts when the same shall become due and payable hereunder;
 
 
 
 
(b)   The failure of Borrower to comply with any provision of this Note;
 
(c)   The failure of Borrower to comply with any provision of any document, instrument or agreement executed in connection with the indebtedness evidenced hereby;
 
(d)   The calling of a meeting of the creditors of Borrower or any other person or entity who is or may become liable hereunder;
 
(e)   The making by Borrower or any other person or entity who is or may become liable hereunder of an assignment for the benefit of its creditors;
 
(f)   The appointment of (or application for appointment of) a receiver of Borrower or any other person or entity who is or may become liable hereunder, or the involuntary filing against or voluntary filing by Borrower, or any other person or entity who is or may become liable hereunder, of a petition or application for relief under federal bankruptcy law or any similar state or federal law, or the issuance of any writ of garnishment, execution or attachment for service with respect to Borrower or any person or entity who is or may become liable hereunder, or any property of Borrower or property of any person or entity who is or may become liable hereunder;
 
(g)   Borrower transfers any right or obligation under this Note without Lender’s prior written consent; or
 
(h)   Any statement, representation or warranty contained herein shall be false.
 
10.   Security.  Borrower’s obligations under this Note are secured by the Collateral described in that certain Security Agreement dated June 19, 2012 between the Borrower and Lender.
 
11.   Additional Sums.  All fees, charges, goods, things in action or any other sums or things of value, other than the interest resulting from the Stated Interest Rate and the Default Interest Rate, as applicable, paid or payable by Borrower (collectively, the "Additional Sums"), whether pursuant to this Note or any other document or instrument in any way pertaining to this lending transaction, or otherwise with respect to this lending transaction, that, under the laws of the State of Florida, may be deemed to be interest with respect to this lending transaction, for the purpose of any laws of the State of Florida that may limit the maximum amount of interest to be charged with respect to this lending transaction, shall be payable by Borrower as, and shall be deemed to be, additional interest, and for such purposes only, the agreed upon and "contracted rate of interest" of this lending transaction shall be deemed to be increased by the rate of interest resulting from the Additional Sums.  Borrower understands and believes that this lending transaction complies with the usury laws of the State of Florida; however, if any interest or other charges in connection with this lending transaction are ever determined to exceed the maximum amount permitted by law, then Borrower agrees that: (a) the amount of interest or charges payable pursuant to this lending transaction shall be reduced to the maximum amount permitted by law; and (b) any excess amount previously collected from Borrower in connection with this lending transaction that exceeded the maximum amount permitted by law, will be credited against the principal balance then outstanding hereunder.  If the outstanding principal balance hereunder has been paid in full, the excess amount paid will be refunded to Borrower.
 
12.   Waivers.  Except as set forth in this Note, to the extent permitted by applicable law, Borrower, and each person who is or may become liable hereunder, severally waive and agree not to assert:  (a) any homestead or exemption rights; (b) demand, diligence, grace, presentment for payment, protest, notice of nonpayment, nonperformance, extension, dishonor, maturity, protest and default; and (c) recourse to guaranty or suretyship defenses (including, without limitation, the right to require the Lender to bring an action on this Note).  Lender may extend the time for payment of or renew this Note, release collateral as security for the indebtedness evidenced hereby or release any party from liability hereunder, and any such extension, renewal, release or other indulgence shall not alter or diminish the liability of Borrower or any other person or entity who is or may become liable on this Note except to the extent expressly set forth in a writing evidencing or constituting such extension, renewal, release or other indulgence.
 
 
 
 
13.   Costs of Collection.  Borrower agrees to pay all costs of collection, including, without limitation, attorneys’ fees, whether or not suit is filed, and all costs of suit and preparation for suit (whether at trial or appellate level), in the event any payment of principal, interest or other amount is not paid when due, or in case it becomes necessary to protect the collateral which is security for the indebtedness evidenced hereby, or to exercise any other right or remedy hereunder, or in the event Lender is made party to any litigation because of the existence of the indebtedness evidenced hereby, or if at any time Lender should incur any attorneys' fees in any proceeding under any federal bankruptcy law (or any similar state or federal law) in connection with the indebtedness evidenced hereby.  In the event of any court proceeding, attorneys' fees shall be set by the court and not by the jury and shall be included in any judgment obtained by Lender.
 
14.   No Waiver by Lender.  No delay or failure of Lender in exercising any right hereunder shall affect such right, nor shall any single or partial exercise of any right preclude further exercise thereof.
 
15.   Governing Law.  This Note shall be construed in accordance with and governed by the laws of the State of Florida, without regard to the choice of law rules of the State of Florida.
 
16.   Jurisdiction and Venue.  Borrower hereby expressly agrees that in the event any actions or other legal proceedings are initiated by or against Borrower or Lender involving any alleged breach or failure by any party to pay, perform or observe any sums, obligations or covenants to be paid, performed or observed by it under this Note, or involving any other claims or allegations arising out of the transactions evidenced or contemplated by this Note, regardless of whether such actions or proceedings shall be for damages, specific performance or declaratory relief or otherwise, such actions, in the sole and absolute discretion of Lender, may be required to be brought in Palm Beach County, Florida; and Borrower hereby submits to the jurisdiction of the State of Florida for such purposes and agrees that the venue of such actions or proceedings shall properly lie in Palm Beach County, Florida; and Borrower hereby waives any and all defenses in such jurisdiction and venue.
 
17.   Joint and Several Liability.  If Borrower is comprised of more than one person or entity, the obligations of each of the persons or entities of which Borrower is comprised shall be joint and several.
 
18.   Time of Essence.  Time is of the essence of this Note and each and every provision hereof.
 
19.   Conflicts; Inconsistency.  In the event of any conflict or inconsistency between the provisions of this Note and the provisions of any document, instrument or agreement executed in connection with the indebtedness evidenced hereby, the provisions of this Note shall govern and control to the extent necessary to resolve such conflict or inconsistency.
 
20.   Amendments.  No amendment, modification, change, waiver, release or discharge hereof and hereunder shall be effective unless evidenced by an instrument in writing and signed by the party against whom enforcement is sought.
 
 
 
 
21.   Severability.  If any provision hereof is invalid or unenforceable, the other provisions hereof shall remain in full force and effect and shall be liberally construed in favor of Lender in order to effectuate the other provisions hereof.
 
22.   Binding Nature.  The provisions of this Note shall be binding upon Borrower and the heirs, personal representatives, successors and assigns of Borrower, and shall inure to the benefit of Lender and any subsequent holder of all or any portion of this Note, and their respective successors and assigns.  Lender may from time to time transfer all or any part of its interest in this Note without notice to Borrower.
 
23.   Notice.  Any notice or other communication with respect to this Note shall: (a) be in writing; (b) be effective on the day of hand-delivery thereof to the party to whom directed, one day following the day of deposit thereof with delivery charges prepaid, with a national overnight delivery service, or two days following the day of deposit thereof with postage prepaid, with the United States Postal Service, by regular first class, certified or registered mail; (c) if directed to Lender, be addressed to Lender at the office of Lender set forth above, or to such other address as Lender shall have specified to Borrower by like notice; and (d) if directed to Borrower, be addressed to Borrower at the address for Borrower set forth below Borrower’s name, or to such other address as Borrower shall have specified by like notice.
 
24.   Section Headings.  The section headings set forth in this Note are for convenience only and shall not have substantive meaning hereunder or be deemed part of this Note.
 
25.   Construction.  This Note shall be construed as a whole, in accordance with its fair meaning, and without regard to or taking into account any presumption or other rule of law requiring construction against the party preparing this Note.
 
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 
 
 

IN WITNESS WHEREOF, Borrower has executed this Note as of the date first set forth above.
 
  “Borrower”
   
   TherapeuticsMD, Inc., a Nevada corporation
     
   
By:
 
/s/ Robert G. Finizio
   
      Robert G. Finizio
   
      Chief Executive Officer
 
   
Address of Borrower:
     
   
951 Broken Sound Parkway NW, Suite 320
   
Boca Raton, Florida 33487
 

 
 
 

Exhibit A
 
Common Stock Purchase Warrant
 
 
ex10_1.htm
ThereapeuticsMD, Inc. 8-K
 
Exhibit 10.1
 
NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY.  THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

 
COMMON STOCK PURCHASE WARRANT
 
THERAPEUTICSMD, INC.
 
Warrant Shares: 1,250,000      Initial Exercise Date: October 31, 2013
 
 
This is to certify that, for the payment of $100 and other good and valuable consideration received, PLATO & ASSOCIATES, LLC (the “Holder”), or its registered assigns, is entitled, at any time from the Issuance Date (as hereinafter defined) to the Expiration Date (as hereinafter defined), to purchase from THERAPEUTICSMD, INC., a Nevada corporation (the “Company”), One Million Two Hundred Fifty Thousand Shares (1,250,000) shares of the Company's Common Stock (as hereinafter defined and subject to adjustment as provided herein), in whole or in part, including fractional parts, at a purchase price per share equal to $3.20 subject to any adjustments made to such amount pursuant to Section 4 hereto) on the terms and conditions and pursuant to the provisions hereinafter set forth.
 
1.
DEFINITIONS
 
As used in this Warrant, the following terms have the respective meanings set forth below:
 
“Additional Shares of Common Stock” shall mean all shares of Common Stock issued by the Company after the Closing Date, other than Warrant Stock.
 
“Book Value” shall mean, in respect of any share of Common Stock on any date herein specified, the consoli­dated book value of the Company as of the last day of any month immediately preceding such date, divided by the number of Fully Diluted Outstanding shares of Common Stock as deter­mined in accordance with GAAP (assuming the payment of the exercise prices for such shares) by a firm of independent certified public account­ants of recognized national standing selected by the Company and reasonably acceptable to the Holder.
 
“Business Day” shall mean any day that is not a Saturday or Sunday or a day on which banks are required or permitted to be closed in the State of New York.
 
 “Commission” shall mean the Securities and Exchange Commission or any other federal agency then administering the Securities Act and other federal securities laws.
 
 
 
 
 
“Common Stock” shall mean (except where the context otherwise indicates) the Common Stock, par value $0.001 per share, of the Company as constituted on the Closing Date, and any capital stock into which such Common Stock may there­after be changed, and shall also include (i) capital stock of the Company of any other class (regardless of how denomi­nated) issued to the holders of shares of Common Stock upon any reclassification thereof which is also not preferred as to dividends or assets over any other class of stock of the Company and which is not subject to redemption and (ii) shares of common stock of any successor or acquiring corporation received by or distributed to the holders of Common Stock of the Company in the circumstances contemplated by Section 4.3.
 
“Convertible Securities” shall mean evidences of indebtedness, shares of stock or other securities which are convertible into or exchangeable, with or without payment of additional consideration in cash or property, for shares of Common Stock, either immediately or upon the occurrence of a specified date or a specified event.
 
“Current Warrant Price” shall mean $3.20 subject to any adjustments to such amount made in accordance with Section 4 hereof.
 
“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, or any successor federal statute, and the rules and regulations of the Commission thereunder, all as the same shall be in effect from time to time.
 
“Exercise Period” shall mean the period during which this Warrant is exercisable pursuant to Section 2.1.
 
“Expiration Date” shall mean January 31, 2019.
 
“Fully Diluted Outstanding” shall mean, when used with reference to Common Stock, at any date as of which the number of shares thereof is to be determined, all shares of Common Stock Outstanding at such date and all shares of Common Stock issuable in respect of this Warrant, outstanding on such date, and other options or warrants to purchase, or securities convertible into, including without limitation the shares of Common Stock outstanding on such date which would be deemed out­stand­ing in accordance with GAAP for purposes of determining book value or net income per share.
 
“GAAP” shall mean generally accepted accounting principles in the United States of America as from time to time in effect.
 
 “Holder” shall mean the Person in whose name the Warrant or Warrant Stock set forth herein is registered on the books of the Company maintained for such purpose.
 
“Market Price” per Common Share means the average of the closing bid prices of the Common Shares as reported on the National Association of Securities Dealers Automated Quotation System for the National Market, (“NASDAQ”) or, if such security is not listed or admitted to trading on the NASDAQ, on the principal national security exchange or quotation system on which such security is quoted or listed or admitted to trading, or, if not quoted or listed or admitted to trading on any national securities exchange or quotation system, the closing bid price of such security on the over-the-counter market on the day in question as reported by the National Association of Security Dealers, Inc., or a similar generally accepted reporting service, as the case may be, for the five (5) trading days immediately preceding the date of determination.
 
“Other Property” shall have the meaning set forth in Section 4.5.
 
 
 
 
 
“Outstanding” shall mean, when used with reference to Common Stock, at any date as of which the number of shares thereof is to be determined, all issued shares of Common Stock, except shares then owned or held by or for the account of the Company or any subsidiary thereof, and shall include all shares issuable in respect of outstanding scrip or any certificates representing fractional interests in shares of Common Stock.
 
“Person” shall mean any individual, sole proprie­tor­ship, partnership, joint venture, trust, incorporated organization, association, corporation, institution, public benefit corporation, entity or government (whether federal, state, county, city, municipal or otherwise, including, without limitation, any instrumentality, division, agency, body or department thereof).
 
“Restricted Common Stock” shall mean shares of Common Stock which are, or which upon their issuance on the exercise of this Warrant would be, evidenced by a certifi­cate bearing the restrictive legend set forth in Section 9.1(a).
 
“Securities Act” shall mean the Securities Act of 1933, as amended, or any successor federal statute, and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time.
 
“Transfer” shall mean any disposition of any Warrant or Warrant Stock or of any interest in either thereof, which would constitute a sale thereof within the meaning of the Securities Act.
 
“Transfer Notice” shall have the meaning set forth in Section 9.2.
 
“Vesting Date” shall mean October 31, 2013.
 
“Warrant Issuance Date” shall mean the date on which the Warrants are issued to the Holder.
 
“Warrants” shall mean this Warrant and all warrants issued upon transfer, division or combination of, or in substitution for, any thereof.  All Warrants shall at all times be identical as to terms and conditions and date, except as to the number of shares of Common Stock for which they may be exercised.
 
“Warrant Price” shall mean an amount equal to (i) the number of shares of Common Stock being purchased upon exercise of this Warrant pursuant to Section 2.1, multiplied by (ii) the Current Warrant Price as of the date of such exercise.
 
“Warrant Stock” shall mean the shares of Common Stock purchased by the holders of the Warrants upon the exercise thereof.
 
2.
EXERCISE OF WARRANT
 
2.1.           Manner of Exercise.  From and after the Vesting Date unless cancelled prior to such date and until 5:00 P.M., New York City time, on the Expiration Date, Holder may exercise this Warrant, on any Business Day, for all or any part of the number of shares of Common Stock purchasable hereunder.
 
 
 
 
 
In order to exercise this Warrant, in whole or in part, Holder shall deliver to the Company at the office or agency designated by the Company pursuant to Section 12, (i) a written notice of Holder’s election to exercise this Warrant, which notice shall specify the number of shares of Common Stock to be purchased, (ii) payment by cash, check or bank draft payable to the Company of the Warrant Price in cash or by wire transfer or cashier’s check drawn on a United States bank for all shares then being purchased and (iii) this Warrant.  Such notice shall be substantially in the form of the subscription form appearing at the end of this Warrant as Exhibit 1, duly executed by Holder or its agent or attorney.  Upon receipt of the items referred to in clauses (i), (ii) and (iii) above, the Company shall, as promptly as practicable, and in any event within five (5) Business Days thereafter, execute or cause to be executed and deliver or cause to be delivered to Holder a certificate or certificates representing the aggregate number of full shares of Common Stock issuable upon such exercise, together with cash in lieu of any fraction of a share, as hereinafter provided.  The stock certificate or certificates so deliv­ered shall be, to the extent possible, in such denomination or denominations as Holder shall request in the notice and shall be registered in the name of Holder or, subject to Section 9, such other name as shall be designated in the notice.  This Warrant shall be deemed to have been exercised and such certificate or certificates shall be deemed to have been issued, and Holder or any other Person so designated to be named therein shall be deemed to have become a holder of record of such shares for all purposes, as of the date the Warrant has been exercised by payment to the Company of the Warrant Price.  If this Warrant shall have been exercised in part, the Company shall, at the time of delivery of the certificate or certificates representing Warrant Stock, deliver to Holder a new Warrant evidencing the rights of Holder to purchase the unpurchased shares of Common Stock called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant.
 
The Holder shall be entitled to exercise the Warrant notwithstanding the commencement of any case under 11 U.S.C. § 101 et seq. (the “Bankruptcy Code”).  In the event the Company is a debtor under the Bankruptcy Code, the Company hereby waives to the fullest extent permitted any rights to relief it may have under 11 U.S.C. § 362 in respect of the Holder’s exercise right.  The Company hereby waives to the fullest extent permitted any rights to relief it may have under 11 U.S.C. § 362 in respect of the exercise of the Warrant.  The Company agrees, without cost or expense to the Holder, to take or consent to any and all action necessary to effectuate relief under 11 U.S.C. § 362.
 
2.2           Cashless Provision.  Holder may elect to exercise the Warrant through the method of cashless exercise as follows:

On the date of calculation of the cashless exercise, if the Market Price of one share of the Company's Common Stock is greater than the Exercise Price (as stated in the Holder's Warrant), in lieu of exercising the Warrant for cash, the holder may elect to receive shares equal to the value (as determined below) of the Warrant (or the portion thereof being exercised) by the surrender of the Warrant at the principle office of the Company together with a properly endorsed Notice of Exercise and notice of such election in which event the Company shall issue to the Holder a number of shares of Common Stock computed using the following formula:

X = Y (A-B)
           A

X= the number of shares of Common Stock to be issued to the Holder

Y = the number of shares of Common Stock purchasable under the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being canceled (at the date of such calculation)

 
 
 
 
A= the Market Price of one share of the Company Common Stock (at the date of such calculation)

B= Exercise Price (as adjusted to the date of such calculation).

The fair market value per share shall be the average of the closing bid and asked prices of the Company's Common Stock quoted on the OTCQB, or the last reported sale price of the Common Stock, or the closing price quoted on the NASDAQ Stock Market or on any exchange on which the Company's Common Stock is listed, whichever is applicable, as published in the Western Edition of The Wall Street Journal for the five (5) trading days prior to the date of the determination of the fair market value.

2.3.           Payment of Taxes and Charges.  All shares of Common Stock issuable upon the exercise of this Warrant pursuant to the terms hereof shall be validly issued, fully paid and nonassessable, and without any preemptive rights.  The Company shall pay all expenses in connection with, and all taxes and other governmental charges that may be imposed with respect to, the issue or delivery thereof.

2.4.           Fractional Shares.  The Company shall not be required to issue a fractional share of Common Stock upon exercise of any Warrant.  As to any fraction of a share which Holder would otherwise be entitled to purchase upon such exercise, the Company shall pay a cash adjustment in respect of such final fraction in an amount equal to the same fraction of the Market Price per share of Common Stock on the relevant exercise date.
 
2.5.           Continued Validity.  A holder of shares of Common Stock issued upon the exercise of this Warrant, in whole or in part (other than a holder who acquires such shares after the same have been publicly sold pursuant to a Registration Statement under the Securities Act or sold pursuant to Rule 144 thereunder), shall continue to be entitled with respect to such shares to all rights to which it would have been entitled as Holder under Sections 9, 10 and 14 of this Warrant.  The Company will, at the time of exercise of this Warrant, in whole or in part, upon the request of Holder, acknowledge in writing, in form reasonably satisfactory to Holder, its continuing obligation to afford Holder all such rights; provided, however, that if Holder shall fail to make any such request, such failure shall not affect the continuing obligation of the Company to afford to Holder all such rights.
 
3.
TRANSFER, DIVISION AND COMBINATION
 
3.1.           Transfer.  Subject to compliance with Section 9, transfer of this Warrant and all rights hereunder, in whole or in part, shall be registered on the books of the Company to be maintained for such purpose, upon surrender of this Warrant at the principal office of the Company referred to in Section 2.1 or the office or agency desig­nated by the Company pursuant to Section 12, together with a written assignment of this Warrant substantially in the form of Exhibit 2 hereto duly executed by Holder or its agent or attorney.  Upon such surren­der, the Company shall, subject to Section 9, execute and deliver a new Warrant or Warrants in the name of the assignee or assignees and in the denomi­na­tion specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled.  A Warrant, if properly assigned in compliance with Section 9, may be exercised by a new Holder for the purchase of shares of Common Stock without having a new Warrant issued.
 
3.2.            Division and Combination.  Subject to Section 9, this Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office or agency of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by Holder or its agent or attorney.  Subject to compliance with Section 3.1 and with Section 9, as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice.
 
 
 
 
 
3.3.           Expenses.  The Company shall prepare, issue and deliver at its own expense the new Warrant or Warrants under this Section 3.
 
3.4.           Maintenance of Books.  The Company agrees to maintain, at its aforesaid office or agency, books for the registration and the registration of transfer of the Warrants.
 
4.
ADJUSTMENTS
 
The number of shares of Common Stock for which this Warrant is exercisable, or the price at which such shares may be purchased upon exercise of this Warrant, shall be subject to adjustment from time to time as set forth in this Section 4.  The Company shall give Holder notice of any event described below which requires an adjustment pursuant to this Section 4 at the time of such event.
 
4.1.           Stock Dividends, Subdivisions and Combinations.  If at any time the Company shall:
 
(a)           take a record of the holders of its Common Stock for the purpose of entitling them to receive a dividend payable in, or other distribution of, Additional Shares of Common Stock,
 
(b)           subdivide its outstanding shares of Common Stock into a larger number of shares of Common Stock, or
 
(c)           combine its outstanding shares of Common Stock into a smaller number of shares of Common Stock,
 
then (i) the number of shares of Common Stock for which this Warrant is exercisable immediately after the occurrence of any such event shall be adjusted to equal the number of  shares of Common Stock which a record holder of the same number of shares of Common Stock for which this Warrant is exercisable immediately prior to the occurrence of such event would own or be entitled to receive after the happen­ing of such event, and (ii) the Current Warrant Price shall be adjusted to equal (A) the Current Warrant Price multi­plied by the number of shares of Common Stock for which this Warrant is exercisable immediately prior to the adjustment divided by (B) the number of shares for which this Warrant is exercisable immediately after such adjustment.
 
4.2.           Other Provisions Applicable to Adjustments under this Section.  The following provisions shall be applicable to the making of adjustments of the number of shares of Common Stock for which this Warrant is exercisable and the Current Warrant Price provided for in this Section 4:
 
(a)           When Adjustments to Be Made.  The adjustments required by this Section 4 shall be made whenever and as often as any specified event requiring an adjustment shall occur.  For the purpose of any adjustment, any specified event shall be deemed to have occurred at the close of business on the date of its occurrence.
 
(b)           Fractional Interests.  In computing adjust­ments under this Section 4, fractional interests in Common Stock shall be taken into account to the nearest 1/10th of a share.
 
 
 
 
 
(c)           When Adjustment Not Required.  If the Company shall take a record of the holders of its Common Stock for the purpose of entitling them to receive a dividend or distribution or subscription or purchase rights and shall, thereafter and before the distribution to stock­holders thereof, legally abandon its plan to pay or deliver such dividend, distribution, subscription or purchase rights, then thereafter no adjustment shall be required by reason of the taking of such record and any such adjustment previously made in respect thereof shall be rescinded and annulled.
 
(d)           Challenge to Good Faith Determination.  Whenever the Board of Directors of the Company shall be required to make a determination in good faith of the fair value of any item under this Section 4, such determination may be challenged in good faith by the Holder, and any dispute shall be resolved by an investment banking firm of recognized national standing selected by the Holder and reasonably acceptable to the Company.
 
(e)           Proceeding Prior to Any Action Requiring Adjustment.  As a condition precedent to the taking of any action which would require an adjustment pursuant to this Section 4, the Company shall take any action which may be necessary, including obtaining regulatory approvals or exemptions, in order that the Company may thereafter validly and legally issue as fully paid and nonassessable all shares of Common Stock which the Holder is entitled to receive upon exercise hereof.
 
4.3.           Reorganization, Reclassification, Merger, Consolidation or Disposition of Assets.  In case the Company shall reorganize its capital, reclassify its capital stock, consolidate or merge with or into another corporation (where the Company is not the surviving corporation or where there is a change in or distribution with respect to the Common Stock of the Company), or sell, transfer or otherwise dispose of all or substantially all its property, assets or business to another corporation and, pursuant to the terms of such reorganization, reclassification, merger, consolidation or disposition of assets, shares of common stock of the successor or acquiring corporation, or any cash, shares of stock or other securities or property of any nature what­so­ever (including warrants or other subscription or purchase rights) in addition to or in lieu of common stock of the successor or acquiring corporation (“Other Property”), are to be received by or distributed to the holders of Common Stock of the Company, then Holder shall have the right thereafter to receive, upon exercise of the Warrant, the number of shares of common stock of the successor or acquir­ing corporation or of the Company, if it is the surviving corpo­ration, and Other Property receivable upon or as a result of such reorganization, reclassification, merger, consolidation or disposition of assets by a holder of the number of shares of Common Stock for which this Warrant is exercisable imme­diately prior to such event.  In case of any such reorgani­za­tion, reclassification, merger, consolidation or disposi­tion of assets, the successor or acquiring corporation (if other than the Company) shall expressly assume the due and punc­tual observance and performance of each and every covenant and condition of this Warrant to be performed and observed by the Company and all the obligations and liabilities here­under, subject to such modifications as may be deemed appropriate, subject to the Holder’s consent, in order to provide for adjustments of shares of Common Stock for which this Warrant is exer­cis­able which shall be as nearly equivalent as practicable to the adjustments provided for in this Section 4.  For purposes of this Section 4.3, “common stock of the successor or acquiring corporation” shall include stock of such corpo­ra­tion of any class which is not preferred as to dividends or assets over any other class of stock of such corporation and which is not subject to redemption and shall also include any evidences of indebtedness, shares of stock or other securities which are convertible into or exchangeable for any such stock, either immediately or upon the arrival of a specified date or the happening of a specified event and any warrants or other rights to subscribe for or pur­chase any such stock.  The foregoing provisions of this Section 4.3 shall similarly apply to successive reorganiza­tions, reclassifications, mergers, consolidations or disposition of assets.
 
 
 
 
 
4.4.           Other Action Affecting Common Stock.  In case at any time or from time to time the Company shall take any action in respect of its Common Stock, other than any action taken in the ordinary course of the Company’s business or any action described in this Section 4, which would have a material adverse effect upon the rights of the Holder, the number of shares of Common Stock and/or the purchase price thereof shall be adjusted in such manner as may be equitable in the circumstances, as determined in good faith by an investment bank selected by Holder.
 
4.5.           Certain Limitations.  Notwithstanding any­thing herein to the contrary, the Company agrees not to enter into any transaction which, by reason of any adjustment hereunder, would cause the Current Warrant Price to be less than the par value per share of Common Stock.
 
4.6.           No Voting Rights.  This Warrant shall not entitle its Holder to any voting rights or other rights as a shareholder of the Company.
 
5.
NOTICES TO HOLDER
 
5.1.           Notice of Adjustments.  Whenever the number of shares of Common Stock for which this Warrant is exercis­able, or whenever the price at which a share of such Common Stock may be purchased upon exercise of the Warrants, shall be adjusted pursuant to Section 4, the Company shall forthwith prepare a certificate to be executed by an executive officer of the Company setting forth, in reasonable detail, the event requiring the adjustment and the method by which such adjustment was calculated, specifying the number of shares of Common Stock for which this Warrant is exercisable and describing the number and kind of any other shares of stock or Other Prop­erty for which this Warrant is exercisable, and any change in the purchase price or prices thereof, after giving effect to such adjustment or change.  The Company shall promptly cause a signed copy of such certificate to be delivered to the Holder in accordance with Section 14.2.  The Company shall keep at its office, or agency designated pursuant to Section 12, copies of all such certificates, and cause the same to be available for inspection at said office during normal business hours by the Holder, its representatives, or any prospective purchaser of a Warrant designated by the Holder.
 
5.2.           Notice of Corporate Action.  If at any time
 
(a)           the Company shall take a record of the holders of its Common Stock for the purpose of entitling them to receive a dividend or other distribu­tion (whether in cash, or any right to subscribe for or purchase any evidences of its indebtedness, any shares of stock of any class or any other securities or property of any nature whatsoever, or to receive any warrants or other rights (including, without limitation, rights to subscribe for or purchase any evidences of its indebtedness, any shares of its stock or any other securities or property of any nature whatsoever), or
 
(b)           there shall be any capital reorganization of the Company, any reclassification or recapitalization of the capital stock of the Company or any consolidation or merger of the Company with, or any sale, transfer or other disposition of all or substantially all the property, assets or business of the Company to, another corporation, or
 
(c)           there shall be a voluntary or involuntary dissolution, liquidation or winding up of the Company;
 
 
 
 
 
then, in any one or more of such cases, the Company shall give to Holder (i) at least thirty (30) Business Days’ prior written notice of the date on which a record date shall be selected for such divi­dend, distribution or right or for determining rights to vote in respect of any such reorganization, reclassifica­tion, merger, consolidation, sale, transfer, disposition, dissolution, liquidation or winding up, and (ii) in the case of any such reorganization, reclassification, merger, consolidation, sale, transfer, disposition, dissolution, liquida­tion or winding up, at least thirty (30) Business Days’ prior written notice of the date when the same shall take place.  Such notice in accordance with the foregoing clause also shall specify (i) the date on which any such record is to be taken for the purpose of such dividend, distribution or right, the date on which the holders of Common Stock shall be entitled to any such dividend, distribution or right, and the amount and character thereof, and (ii) the date on which any such reorganization, reclassification, merger, consolidation, sale, transfer, disposition, dissolution, liquidation or winding up is to take place and the time, if any such time is to be fixed, as of which the holders of Common Stock shall be entitled to exchange their shares of Common Stock for securities or other property deliverable upon such reorganization, reclassification, merger, consolidation, sale, transfer, disposition, dissolution, liquidation or winding up.  Each such written notice shall be sufficiently given if addressed to Holder at the last address of Holder appearing on the books of the Company and delivered in accor­dance with Section 14.2.
 
A reclassification of the Common Stock (other than a change in par value, or from par value to no par value or from no par value to par value) into shares of Common Stock and shares of any other class of stock shall be deemed a distribution by the Company to the holders of its Common Stock of such shares of such other class of stock within the meaning of this Section and, if the outstanding shares of Common Stock shall be changed into a larger or smaller number of shares of Common Stock as a part of such reclassification, such change shall be deemed a subdivision or combination, as the case may be, of the outstanding shares of Common Stock within the meaning of Section 4.1.
 
6.
NO IMPAIRMENT
 
The Company shall not by any action, including, with­out limitation, amending its certificate of incorporation or through any reorganization, transfer of assets, consolida­tion, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder against impairment.  Without limiting the generality of the foregoing, the Company will (a) not increase the par value of any shares of Common Stock receivable upon the exercise of this Warrant above the amount payable there­for upon such exercise immediately prior to such increase in par value, (b) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable shares of Common Stock upon the exercise of this Warrant, and (c) use its best efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof as may be necessary to enable the Company to perform its obligations under this Warrant.
 
Upon the request of Holder, the Company will at any time during the period this Warrant is outstanding acknowl­edge in writing, in form reasonably satisfactory to Holder, the contin­u­ing validity of this Warrant and the obligations of the Company hereunder.
 
7.
RESERVATION AND AUTHORIZATION OF COMMON STOCK
 
From and after the Closing Date, the Company shall at all times reserve and keep available for issue upon the exercise of Warrants such number of its authorized but unissued shares of Common Stock as will be sufficient to permit the exercise in full of all outstanding Warrants.  All shares of Common Stock which shall be so issuable, when issued upon exercise of any Warrant and payment therefor in accordance with the terms of such Warrant, shall be duly and validly issued and fully paid and nonassessable, and not subject to preemptive rights.
 
 
 
 
 
Before taking any action which would cause an adjustment reducing the Current Warrant Price below the then par value, if any, of the shares of Common Stock issuable upon exercise of the Warrants, the Company shall take any corpo­rate action which may be necessary in order that the Company may validly and legally issue fully paid and non-assessable shares of such Common Stock at such adjusted Current Warrant Price.
 
Before taking any action which would result in an adjustment in the number of shares of Common Stock for which this Warrant is exercisable or in the Current Warrant Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having jurisdiction thereof.
 
8.
TAKING OF RECORD; STOCK AND WARRANT TRANSFER BOOKS
 
In the case of all dividends or other distribu­tions by the Company to the holders of its Common Stock with respect to which any provision of Section 4 refers to the taking of a record of such holders, the Company will in each such case take such a record as of the close of business on a Business Day.  The Company will not at any time close its stock transfer books or Warrant transfer books so as to result in preventing or delaying the exercise or transfer of any Warrant.
 
9.
RESTRICTIONS ON TRANSFERABILITY
 
The Warrants and the Warrant Stock shall not be transferred, hypothecated or assigned before satisfaction of the conditions specified in this Section 9, which conditions are intended to ensure compliance with the provisions of the Securities Act with respect to the Transfer of any Warrant or any Warrant Stock.  Holder, by acceptance of this Warrant, agrees to be bound by the provisions of this Section 9.
 
9.1.           Restrictive Legend.  The Holder by accepting this Warrant and any Warrant Stock agrees that this Warrant and the Warrant Stock issuable upon exercise hereof may not be assigned or otherwise transferred unless and until (i) the Company has received an opinion of counsel for the Holder that such securities may be sold pursuant to an exemption from registration under the Securities Act or (ii) a registration statement relating to such securities has been filed by the Company and declared effective by the Commission.
 
(a)           Each certificate for Warrant Stock issuable hereunder shall bear a legend substantially worded as follows unless such securities have been sold pursuant to an effective registration statement under the Securities Act:
 
“The securities represented by this certificate have not been registered under the Securities Act of 1933, as amended (the “Act”) or any state securities laws.  The securities may not be offered for sale, sold, assigned, offered, transferred or otherwise distributed for value except (i) pursuant to an effective registration statement under the Act or any state securities laws or (ii) pursuant to an exemption from registration or prospectus delivery requirements under the Act or any state securities laws in respect of which the Company has received an opinion of counsel satisfactory to the Company to such effect.  Copies of the agreement covering both the purchase of the securities and restricting their transfer may be obtained at no cost by written request made by the holder of record of this certificate to the Secretary of the Company at the principal executive offices of the Company.”

 
 
 

(b)           Except as otherwise provided in this Sec­tion 9, the Warrant shall be stamped or otherwise imprinted with a legend in substantially the following form:
 
“This Warrant and the securities represented hereby have not been regis­tered under the Securities Act of 1933, as amended, or any state securities laws and may not be transferred in violation of such Act, the rules and regulations thereunder or any state securities laws or the provisions of this Warrant.”
 
9.2.           Notice of Proposed Transfers.  Prior to any Transfer or attempted Transfer of any Warrants or any shares of Restricted Common Stock, the Holder shall give five (5) days’ prior written notice (a “Transfer Notice”) to the Company of Holder’s intention to effect such Transfer, describing the manner and circumstances of the proposed Transfer, and obtain from counsel to Holder an opinion that the proposed Transfer of such Warrants or such Restricted Common Stock may be effected without registration under the Securities Act or state securities laws.  After the Company’s receipt of the Transfer Notice and opinion, such Holder shall thereupon be entitled to Transfer such Warrants or such Restricted Common Stock, in accordance with the terms of the Transfer Notice.  Each certificate, if any, evidencing such shares of Restricted Common Stock issued upon such Transfer and the Warrant issued upon such Transfer shall bear the restrictive legends set forth in Section 9.1, unless in the opinion of such counsel such legend is not required in order to ensure compliance with the Securities Act.
 
9.3.           Termination of Restrictions.  Notwithstand­ing the foregoing provisions of Section 9, the restrictions imposed by this Section upon the transferability of the Warrants, the Warrant Stock and the Restricted Common Stock (or Common Stock issuable upon the exercise of the Warrants) and the legend requirements of Section 9.1 shall terminate as to any particular Warrant or share of Warrant Stock or Restricted Common Stock (or Common Stock issuable upon the exercise of the Warrants) (i) when and so long as such security shall have been effectively registered under the Securities Act and applicable state securities laws and disposed of pursuant thereto or (ii) when the Company shall have received an opinion of counsel that such shares may be transferred with­out registration thereof under the Securities Act and applicable state securities laws.  Whenever the restrictions imposed by Section 9 shall terminate as to this Warrant, as hereinabove provided, the Holder hereof shall be entitled to receive from the Company upon written request of the Holder, at the expense of the Company, a new Warrant bearing the following legend in place of the restrictive legend set forth hereon:
 
“THE RESTRICTIONS ON TRANSFERABIL­ITY OF THE WITHIN WARRANT CONTAINED IN SECTION 9 HEREOF TERMINATED ON ________, 20__, AND ARE OF NO FURTHER FORCE AND EFFECT.”
 
All Warrants issued upon registration of transfer, division or combination of, or in substitution for, any Warrant or Warrants entitled to bear such legend shall have a similar legend endorsed thereon.  Whenever the restrictions imposed by this Section shall terminate as to any share of Restricted Common Stock, as hereinabove provided, the holder thereof shall be entitled to receive from the Company, at the Company’s expense, a new certificate representing such Common Stock not bearing the restrictive legends set forth in Section 9.1.
 
9.4.           Listing on Securities Exchange.  If the Company shall list any shares of Common Stock on any securities exchange, it will, at its expense, list thereon, maintain and, when necessary, increase such listing of, all shares of Common Stock issued or, to the extent permissible under the applicable securities exchange rules, issuable upon the exercise of this Warrant so long as any shares of Common Stock shall be so listed during the Exercise Period.
 
 
 
 
 
10.
SUPPLYING INFORMATION
 
The Company shall cooperate with Holder in supplying such information as may be reasonably necessary for Holder to complete and file any information reporting forms presently or hereafter required by the Commission as a condition to the availability of an exemption from the Securities Act for the sale of any Warrant or Restricted Common Stock.
 
11.
LOSS OR MUTILATION
 
Upon receipt by the Company from Holder of evidence reasonably satisfactory to it of the ownership of and the loss, theft, destruction or mutilation of this Warrant and indemnity reasonably satisfactory to it (it being understood that the written agreement of the Holder shall be sufficient indemnity), and in case of mutilation upon surrender and cancellation hereof, the Company will execute and deliver in lieu hereof a new Warrant of like tenor to Holder; provided, in the case of mutilation, no indemnity shall be required if this Warrant in identifiable form is surrendered to the Company for cancellation.
 
12.
OFFICE OF THE COMPANY
 
As long as any of the Warrants remain outstanding, the Company shall maintain an office or agency (which may be the principal executive offices of the Company) where the Warrants may be presented for exercise, registration of transfer, division or combination as provided in this Warrant, such office to be initially located at 951 Broken Sound Parkway NW, Suite 320, Boca Raton, FL  33487, provided, however, that the Company shall provide prior written notice to Holder of a change in address no less than thirty (30) days prior to such change.
 
13.
LIMITATION OF LIABILITY
 
No provision hereof, in the absence of affirmative action by Holder to purchase shares of Common Stock, and no enumeration herein of the rights or privileges of Holder hereof, shall give rise to any liability of Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.
 
14.
MISCELLANEOUS
 
14.1.           Non-waiver and Expenses.  No course of deal­ing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right or otherwise prejudice Holder’s rights, powers or remedies, notwithstanding all rights hereunder terminate on the Expiration Date.  If the Company fails to make, when due, any payments provided for hereunder, or fails to comply with any other provision of this Warrant, the Company shall pay to Holder such amounts as shall be sufficient to cover any direct and indirect losses, damages, costs and expenses including, but not limited to, reasonable attor­neys’ fees, including those of appellate proceedings, incurred by Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.
 
14.2.           Notice Generally.  Except as may be otherwise provided herein, any notice or other communication or delivery required or permitted hereunder shall be in writing and shall be delivered personally or sent by certified mail, postage prepaid, or by a nationally recognized overnight courier service, and shall be deemed given when so delivered personally or by overnight courier service, or, if mailed, three (3) days after the date of deposit in the United States mails, as follows:
 
 
 
 
 
(a)           if to the Company, to:                          TherapeuticsMD, Inc.
951 Broken Sound Parkway, Suite 321
Boca Raton, FL  33487
Attention:  Robert G. Finizio
Phone:   (561) 961-1911 Fax: (561) 431-3389

 (b)           if to the Holder to:                               Robert J. Smith, Managing Member
Plato & Associates, LLC
13652 Fiddlesticks Blvd.
Suite 202-324
Ft. Myers, FL  33912

The Company or the Holder may change the foregoing address by notice given pursuant to this Section 14.2.

14.3.           Successors and Assigns.  Subject to the provisions of Sections 3.1 and 9, this Warrant and the rights evidenced hereby shall inure to the benefit of and be binding upon the successors of the Company and the successors and assigns of Holder.  The provisions of this Warrant are intended to be for the benefit of all Holders from time to time of this Warrant and, with respect to Section 9 hereof, holders of Warrant Stock, and shall be enforceable by any such Holder or holder of Warrant Stock.
 
14.4.           Amendment.  This Warrant and all other Warrants may be modified or amended or the provisions hereof waived only with the prior written consent of the Company and the Holder.
 
14.5.           Severability.  Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Warrant.
 
14.6.           Headings.  The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.
 
14.7.           Governing Law.  This Warrant shall be governed by the laws of the State of Florida, without regard to the provisions thereof relating to conflict of laws. The Company consents to the jurisdiction of the federal courts whose districts encompass any part of Florida in connection with any dispute arising under this Warrant or any of the transactions contemplated hereby, and hereby waives, to the maximum extent permitted by law, any objection, including any objections based on forum non conveniens, to the bringing of any such proceeding in such jurisdictions.


[SIGNATURE PAGE FOLLOWS]

 
 
 

IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed and its corporate seal to be impressed hereon and attested by its Secretary or an Assistant Secretary.
 
 
 Dated:  January 31, 2013  
THERAPEUTICSMD, INC.
     
     
   
By:
/s/ Robert F. Finizio
   
 
  Robert F. Finizio
   
 
  Chief Executive Officer

Attest:
  
     
By:
/s/ John C.K. Milligan, IV
  
 
 John C.K. Milligan, IV  
 
 Secretary  
 
 
 

EXHIBIT 1
 
SUBSCRIPTION FORM
 
[To be executed only upon exercise of Warrant]
 
The undersigned registered owner of this Warrant irrevocably exercises this Warrant for the purchase of ______ Shares of Common Stock of TherapeuticsMD, Inc., and herewith makes payment therefor in cash or by check or bank draft made payable to the Company, all at the price and on the terms and conditions specified in this Warrant and requests that certificates for the shares of Common Stock hereby purchased (and any securities or other property issuable upon such exercise) be issued in the name of and delivered to _____________ whose address is _________________ and, if such shares of Common Stock shall not include all of the shares of Common Stock issuable as provided in this Warrant, that a new Warrant of like tenor and date for the balance of the shares of Common Stock issuable hereunder be delivered to the undersigned.
 
   
 
    (Name of Registered Owner)
     
     
     
   
(Signature of Registered Owner)
     
     
     
    (Street Address)
     
     
         
    (City) (State)  (Zip Code)

 
 
 
 
NOTICE:                      The signature on this subscription must correspond with the name as written upon the face of the within Warrant in every particular, without alteration or enlargement or any change whatsoever.

 
 
 

EXHIBIT 2
 
ASSIGNMENT FORM
 
FOR VALUE RECEIVED the undersigned registered owner of this Warrant hereby sells, assigns and transfers unto the Assignee named below all of the rights of the undersigned under this Warrant, with respect to the number of shares of Common Stock set forth below:
 
   Name and Address of Assignee        No. of Shares of Common Stock
       
       
       
       
       
       
 
and does hereby irrevocably constitute and appoint ________________________ attorney-in-fact to register such transfer on the books of TherapeuticsMD, Inc. maintained for the purpose, with full power of substitution in the premises.
 
 
    Dated:     Print Name:
 
           
           
           
           
        Signature:
 
           
           
        Witness:  
           
           
           

NOTICE:                      The signature on this assignment must correspond with the name as written upon the face of the within Warrant in every particular, without alteration or enlargement or any change whatsoever.