THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUED UPON ITS
EXERCISE ARE SUBJECT TO THE RESTRICTIONS ON
TRANSFER SET FORTH IN SECTION 4 OF THIS WARRANT
Warrant No. 5 Number of Shares: 150,000
(subject to adjustment)
Date of Issuance: March 11, 1999
IGI, INC.
Common Stock Purchase Warrant
(Void after October 1, 2004)
IGI, Inc., a Delaware corporation (the "Company"), for value received,
hereby certifies that Fleet Bank-N.H., a banking and trust company organized
under the laws of New Hampshire, or its registered assigns (the "Registered
Holder"), is entitled, subject to the terms set forth below, to purchase from
the Company, at any time or from time to time on or after the 60th day after the
date of issuance and on or before October 1, 2004 at not later than 5:00 p.m.
(Boston, Massachusetts time), 150,000 shares of Common Stock, $.01 par value per
share (the "Common Stock"), of the Company, at a Exercise Price of $2.00 per
share. The shares issuable upon exercise of this Warrant, and the Exercise Price
per share, each as adjusted from time to time pursuant to the provisions of this
Warrant, are hereinafter referred to as the "Warrant Shares" and the "Exercise
Price," respectively.
1. Certain Definitions. As used in this Warrant, the following terms shall
have the following respective meanings:
"Commission" means the Securities and Exchange Commission, or any other
Federal agency at the time administering the Securities Act.
"Registration Statement" means a registration statement filed by the
Company with the Commission for a public offering and sale of Common Stock
(other than a registration statement on Form S-8 or Form S-4, or their
successors, or any other form for a similar limited purpose, or any registration
statement covering only securities proposed to be issued in exchange for
securities or assets of another corporation).
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"Registrable Shares" means (i) the Warrant Shares, and (ii) any other
shares of Common Stock issued in respect of such shares (because of stock
splits, stock dividends, reclassifications, recapitalizations, or similar
events); provided, however, that shares of Common Stock which are Registrable
Shares shall cease to be Registrable Shares (i) upon any sale pursuant to a
Registration Statement or Rule 144 under the Securities Act or (ii) upon any
sale in any manner to a person or entity which, by virtue of Section 13 of this
Warrant, is not entitled to the rights provided by this Warrant.
"Securities Act" means the Security Act of 1933, as amended, or any similar
Federal statute, and the rules and regulations of the Commission issued under
such Act, as they each may, from time to time, be in effect.
2. Exercise.
(a) This Warrant may be exercised by the Registered Holder, in whole or in
part, by surrendering this Warrant, with the purchase form appended hereto as
Exhibit I duly executed by such Registered Holder or by such Registered Holder's
duly authorized attorney, at the principal office of the Company, or at such
other office or agency as the Company may designate, accompanied by payment in
full, in lawful money of the United States, of the Exercise Price payable in
respect of the number of Warrant Shares issued upon such exercise.
(b) The Registered Holder may, at its option, elect to pay some or all of
the Exercise Price payable upon an exercise of this Warrant by cancelling a
portion of this Warrant exercisable for such number of Warrant Shares as is
determined by dividing (i) the total Exercise Price payable in respect of the
number of Warrant Shares being issued upon such exercise by (ii) the excess of
the Fair Market Value per share of Common Stock as of the effective date of
exercise, as determined pursuant to subsection 2(c) below (the "Exercise Date")
over the Exercise Price per share. If the Registered Holder wishes to exercise
this Warrant pursuant to this method of payment with respect to the maximum
number of Warrant Shares issuable pursuant to this method, then the number of
Warrant Shares so issuable shall be equal to the total number of Warrant Shares,
minus the product obtained by multiplying (x) the total number of Warrant Shares
by (y) a fraction, the numerator of which shall be the Exercise Price per share
and the denominator of which shall be the Fair Market Value per share of Common
Stock as of the Exercise Date. The Fair Market Value per share of Common Stock
shall be determined as follows:
(i) If the Common Stock is listed on a national securities
exchange, the Nasdaq Stock Market or another nationally recognized
exchange or trading system as of the Exercise Date, the Fair Market
Value per share of Common Stock shall be deemed to be the average of
the last reported sale price per share of
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Common Stock thereon for the ten consecutive trading days ending on the day
immediately prior to the Exercise Date;
(ii) If the Common Stock is not listed on a national securities
exchange, the Nasdaq Stock Market or another nationally recognized
exchange or trading system as of the Exercise Date, the Fair Market
Value per share of Common Stock shall be deemed to be the amount most
recently determined in good faith by the Board of Directors to
represent the fair market value per share of the Common Stock
(including without limitation a determination for purposes of granting
Common Stock options or issuing Common Stock under an employee benefit
plan of the Company); and, upon request of the Registered Holder, the
Board of Directors (or a representative thereof) shall promptly notify
the Registered Holder of the Fair Market Value per share of Common
Stock. Notwithstanding the foregoing, if the Board of Directors has
not made such a determination within a forty-five day period prior to
the Exercise Date, then (A) the Fair Market Value per share of Common
Stock shall be the amount next determined in good faith by the Board
of Directors to represent the fair market value per share of the
Common Stock (including without limitation a determination for
purposes of granting Common Stock options or issuing Common Stock
under an employee benefit plan of the Company), (B) the Board of
Directors shall make such a determination within 15 days of a request
by the Registered Holder that it do so, and (C) the exercise of this
Warrant pursuant to this subsection 2(b) shall be delayed until such
determination is made.
(c) Each exercise of this Warrant shall be deemed to have been effected
immediately prior to the close of business on the day on which this Warrant
shall have been surrendered to the Company as provided in subsection 2(a) above.
At such time, the person or persons in whose name or names any certificates for
Warrant Shares shall be issuable upon such exercise as provided in subsection
2(d) below shall be deemed to have become the holder or holders of record of the
Warrant Shares represented by such certificates.
(d) As soon as practicable after the exercise of this Warrant in full or in
part, and in any event within 10 days thereafter, the Company, at its expense,
will cause to be issued in the name of, and delivered to, the Registered Holder,
or as such Registered Holder (upon payment by such Holder of any applicable
transfer taxes) may direct:
(i) a certificate or certificates for the number of full Warrant
Shares to which such Registered Holder shall be entitled upon such
exercise plus, in lieu of any fractional share to which such
Registered Holder would otherwise be entitled, cash in an amount
determined pursuant to Section 4 hereof; and
(ii) in case such exercise is in part only, a new warrant or
warrants (dated the date hereof) of like tenor, calling in the
aggregate on the face or
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faces thereof for the number of Warrant Shares equal (without giving effect to
any adjustment therein) to the number of such shares called for on the face of
this Warrant minus the sum of (a) the number of such shares purchased by the
Registered Holder upon such exercise plus (b) the number of Warrant Shares (if
any) covered by the portion of this Warrant cancelled in payment of the Exercise
Price payable upon such exercise pursuant to subsection 2(b) above.
(e) Notwithstanding the foregoing, the Warrant shall become immediately
exercisable by the Registered Holder upon (i) the occurrence of an Event of
Default (as defined in the Second Extension Agreement dated March 11, 1999 by
and among the Registered Holder, Fleet Bank-N.H., the Company and certain of its
subsidiaries (the "Second Extension Agreement")) or (ii) the mailing date of
written notice by the Company of its intention to exercise its right under
Section 8 to redeem Available Warrant Shares (as defined under subsection 8(a)).
3. Adjustments.
(a) General. The Exercise Price shall be subject to adjustment from time to
time pursuant to the terms of this Section 3.
(b) Diluting Issuances.
(i) Special Definitions. For purposes of this subsection 3(b),
the following definitions shall apply:
(A) "Option" shall mean rights, options or warrants to
subscribe for, purchase or otherwise acquire Common Stock or
Convertible Securities, excluding options described in clause
(II) of subsection 3(b)(i)(D) below.
(B) "Original Issue Date" shall mean the date on which this
Warrant was first issued.
(C) "Convertible Securities" shall mean any evidences of
indebtedness, shares or other securities directly or indirectly
convertible into or exchangeable for Common Stock.
(D) "Additional Shares of Common Stock" shall mean all
shares of Common Stock issued (or, pursuant to subsection
3(b)(iii) below, deemed to be issued) by the Company after the
Original Issue Date, other than shares of Common Stock issued or
issuable:
(I) by reason of a dividend, stock split, split-up or other
distribution on shares of Common Stock that are
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excluded from the definition of Additional Shares of Common
Stock by this clause (I); or
(II) to employees or directors of, or consultants to, the Company
pursuant to a plan adopted by the Board of Directors of the
Company.
(ii) No Adjustment of Exercise Price. No adjustments to the
Exercise Price shall be made unless the consideration per share
(determined pursuant to subsection 3(b)(v)) for an Additional Share of
Common Stock issued or deemed to be issued by the Company is less than
the Exercise Price in effect on the date of, and immediately prior to,
the issue of such Additional Shares.
(iii) Issue of Securities Deemed Issue of Additional Shares of
Common Stock. If the Company at any time or from time to time after
the Original Issue Date shall issue any Options or Convertible
Securities or shall fix a record date for the determination of holders
of any class of securities entitled to receive any such Options or
Convertible Securities, then the maximum number of shares of Common
Stock (as set forth in the instrument relating thereto without regard
to any provision contained therein for a subsequent adjustment of such
number) issuable upon the exercise of such Options or, in the case of
Convertible Securities and Options therefor, the conversion or
exchange of such Convertible Securities, shall be deemed to be
Additional Shares of Common Stock issued as of the time of such issue
or, in case such a record date shall have been fixed, as of the close
of business on such record date, provided that Additional Shares of
Common Stock shall not be deemed to have been issued unless the
consideration per share (determined pursuant to subsection 3(b)(v)
hereof) of such Additional Shares of Common Stock would be less than
the Exercise Price in effect on the date of and immediately prior to
such issue, or such record date, as the case may be, and provided
further that in any such case in which Additional Shares of Common
Stock are deemed to be issued:
(A) No further adjustment in the Exercise Price shall be
made upon the subsequent issue of Convertible Securities or
shares of Common Stock upon the exercise of such Options or
conversion or exchange of such Convertible Securities;
(B) If such Options or Convertible Securities by their terms
provide, with the passage of time or otherwise, for any increase
in the consideration payable to the Company, upon the exercise,
conversion or exchange thereof, the Exercise Price computed upon
the original issue thereof (or upon the occurrence of a record
date with respect thereto), and any subsequent adjustments based
thereon, shall, upon any such increase becoming effective, be
recomputed to reflect such increase insofar as it affects such
Options or the rights of conversion or exchange under such
Convertible Securities;
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(C) Upon the expiration or termination of any unexercised
Option, the Exercise Price shall not be readjusted, but the
Additional Shares of Common Stock deemed issued as the result of
the original issue of such Option shall not be deemed issued for
the purposes of any subsequent adjustment of the Exercise Price;
(D) In the event of any change in the number of shares of
Common Stock issuable upon the exercise, conversion or exchange
of any Option or Convertible Security, including, but not limited
to, a change resulting from the anti-dilution provisions thereof,
the Exercise Price then in effect shall forthwith be readjusted
to such Exercise Price as would have obtained had the adjustment
which was made upon the issuance of such Option or Convertible
Security not exercised or converted prior to such change been
made upon the basis of such change; and
(E) No readjustment pursuant to Clause (B) or (D) above
shall have the effect of increasing the Exercise Price to an
amount which exceeds the lower of (i) the Exercise Price on the
original adjustment date, or (ii) the Exercise Price that would
have resulted from any issuances of Additional Shares of Common
Stock between the original adjustment date and such readjustment
date.
(iv) Adjustment of Exercise Price Upon Issuance of Additional Shares
of Common Stock. In the event the Company shall at any time after the
Original Issue Date issue Additional Shares of Common Stock (including
Additional Shares of Common Stock deemed to be issued pursuant to
subsection 3(b)(iii), but excluding shares issued as a dividend or
distribution or upon a stock split or combination as provided in subsection
3(c)), without consideration or for a consideration per share less than the
Exercise Price in effect on the date of and immediately prior to such
issue, then and in such event, such Exercise Price shall be reduced,
concurrently with such issue, to a price (calculated to the nearest cent)
determined by multiplying such Exercise Price by a fraction, (A) the
numerator of which shall be (1) the number of shares of Common Stock
outstanding immediately prior to such issue plus (2) the number of shares
of Common Stock which the aggregate consideration received or to be
received by the Company for the total number of Additional Shares of Common
Stock so issued would purchase at such Exercise Price; and (B) the
denominator of which shall be the number of shares of Common Stock
outstanding immediately prior to such issue plus the number of such
Additional Shares of Common Stock so issued; provided that, (i) for the
purpose of this subsection 3(b)(iv), all shares of Common Stock issuable
upon exercise or conversion of Options or Convertible Securities
outstanding immediately prior to such issue shall be deemed to be
outstanding (other than shares excluded from the definition of "Additional
Shares of Common Stock" by virtue of clause (II) of subsection 3(b)(i)(D)),
and (ii) the number of shares of Common Stock deemed issuable upon
conversion of such outstanding Options and Convertible Securities shall not
give effect to any adjustments to the conversion price or conversion rate
of
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such Options or Convertible Securities resulting from the issuance of Additional
Shares of Common Stock that is the subject of this calculation.
Notwithstanding the foregoing, the applicable Exercise Price shall not be
so reduced at such time if the amount of such reduction would be an amount less
than $.05, but any such amount shall be carried forward and reduction with
respect thereto made at the time of and together with any subsequent reduction
which, together with such amount and any other amount or amounts so carried
forward, shall aggregate $.05 or more.
(v) Determination of Consideration. For purposes of this
subsection 3(b), the consideration received by the Company for the
issue of any Additional Shares of Common Stock shall be computed as
follows:
(A) Cash and Property: Such consideration shall:
(I) insofar as it consists of cash, be computed at the
aggregate of cash received by the Company, excluding amounts
paid or payable for accrued interest or accrued dividends;
(II) insofar as it consists of property other than
cash, be computed at the fair market value thereof at the
time of such issue, as determined in good faith by the Board
of Directors; and
(III) in the event Additional Shares of Common Stock
are issued together with other shares or securities or other
assets of the Company for consideration which covers both,
be the proportion of such consideration so received,
computed as provided in clauses (I) and (II) above, as
determined in good faith by the Board of Directors.
(B) Options and Convertible Securities. The consideration
per share received by the Company for Additional Shares of Common
Stock deemed to have been issued pursuant to subsection
3(b)(iii), relating to Options and Convertible Securities, shall
be determined by dividing
(x) the total amount, if any, received or receivable by
the Company as consideration for the issue of such Options
or Convertible Securities, plus the minimum aggregate amount
of additional consideration (as set forth in the instruments
relating thereto, without regard to any provision contained
therein for a subsequent adjustment of such consideration)
payable to the Company upon the exercise of such Options or
the conversion or exchange of such Convertible Securities,
or in the case of Options for Convertible Securities, the
exercise of such Options for Convertible Securities and the
conversion or exchange of such Convertible Securities, by
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(y) the maximum number of shares of Common Stock (as
set forth in the instruments relating thereto, without
regard to any provision contained therein for a subsequent
adjustment of such number) issuable upon the exercise of
such Options or the conversion or exchange of such
Convertible Securities.
(c) Recapitalizations. If outstanding shares of Common Stock shall be
subdivided into a greater number of shares or a dividend in Common Stock shall
be paid in respect of Common Stock, the Exercise Price in effect immediately
prior to such subdivision or at the record date of such dividend shall
simultaneously with the effectiveness of such subdivision or immediately after
the record date of such dividend be proportionately reduced. If outstanding
shares of Common Stock shall be combined into a smaller number of shares, the
Exercise Price in effect immediately prior to such combination shall,
simultaneously with the effectiveness of such combination, be proportionately
increased.
(d) Mergers, etc. If there shall occur any capital reorganization or
reclassification of the Common Stock (other than a change in par value or a
subdivision or combination as provided for in subsection 3(c) above), or any
consolidation or merger of the Company with or into another corporation, or a
transfer of all or substantially all of the assets of the Company, then, as part
of any such reorganization, reclassification, consolidation, merger or sale, as
the case may be, lawful provision shall be made so that the Registered Holder of
this Warrant shall have the right thereafter to receive upon the exercise hereof
the kind and amount of shares of stock or other securities or property which
such Registered Holder would have been entitled to receive if, immediately prior
to any such reorganization, reclassification, consolidation, merger or sale, as
the case may be, such Registered Holder had held the number of shares of Common
Stock which were then issuable upon the exercise of this Warrant. In any such
case, appropriate adjustment (as reasonably determined in good faith by the
Board of Directors of the Company) shall be made in the application of the
provisions set forth herein with respect to the rights and interests thereafter
of the Registered Holder of this Warrant, such that the provisions set forth in
this Section 3 (including provisions with respect to adjustment of the Exercise
Price) shall thereafter be applicable, as nearly as is reasonably practicable,
in relation to any shares of stock or other securities or property thereafter
deliverable upon the exercise of this Warrant.
(e) Adjustment in Number of Warrant Shares. When any adjustment is required
to be made in the Exercise Price, the number of Warrant Shares purchasable upon
the exercise of this Warrant shall be changed to the number determined by
dividing (i) an amount equal to the number of shares issuable upon the exercise
of this Warrant immediately prior to such adjustment, multiplied by the Exercise
Price in effect immediately prior to such adjustment, by (ii) the Exercise Price
in effect immediately after such adjustment.
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(f) Certificate of Adjustment. When any adjustment is required to be made
pursuant to this Section 3, the Company shall promptly mail to the Registered
Holder a certificate setting forth the Exercise Price after such adjustment and
setting forth a brief statement of the facts requiring such adjustment. Such
certificate shall also set forth the kind and amount of stock or other
securities or property into which this Warrant shall be exercisable following
such adjustment.
4. Fractional Shares. The Company shall not be required upon the exercise
of this Warrant to issue any fractional shares, but shall make an adjustment
therefor in cash on the basis of the Fair Market Value per share of Common
Stock, as determined pursuant to subsection 2(b) above.
5. Requirements for Transfer.
(a) This Warrant and the Warrant Shares shall not be sold or transferred
unless either (i) they first shall have been registered under the Securities Act
of 1933, as amended (the "Securities Act"), or (ii) the Company first shall have
been furnished with an opinion of legal counsel, reasonably satisfactory to the
Company, to the effect that such sale or transfer is exempt from the
registration requirements of the Act.
(b) Notwithstanding the foregoing, no registration or opinion of counsel
shall be required for (i) a transfer by a Registered Holder which is a
partnership to a partner of such partnership or a retired partner of such
partnership who retires after the date hereof, or to the estate of any such
partner or retired partner, if the transferee agrees in writing to be subject to
the terms of this Section 5, (ii) a transfer made in accordance with Rule 144
under the Act, or (iii) a transfer by a Registered Holder which is a corporation
to an affiliate, as defined under Rule 144 of the Securities Act, if the
transferee agrees in writing to be subject to the terms of this Section.
(c) Each certificate representing Warrant Shares shall bear a legend
substantially in the following form:
"The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended, and may not
be offered, sold or otherwise transferred, pledged or hypothecated
unless and until such securities are registered under such Act or an
opinion of counsel satisfactory to the Company is obtained to the
effect that such registration is not required."
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The foregoing legend shall be removed from the certificates representing any
Warrant Shares, at the request of the holder thereof, at such time as they
become eligible for resale pursuant to Rule 144(k) under the Act.
6. No Impairment. The Company will not, by amendment of its charter or
through reorganization, consolidation, merger, dissolution, sale of assets 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 action as
may be necessary or appropriate in order to protect the rights of the holder of
this Warrant against impairment.
7. Liquidating Dividends. If the Company pays a dividend or makes a
distribution on the Common Stock payable otherwise than in cash out of earnings
or earned surplus (determined in accordance with generally accepted accounting
principles) except for a stock dividend payable in shares of Common Stock (a
"Liquidating Dividend"), then the Company will pay or distribute to the
Registered Holder of this Warrant, upon the exercise hereof, in addition to the
Warrant Shares issued upon such exercise, the Liquidating Dividend which would
have been paid to such Registered Holder if he had been the owner of record of
such Warrant Shares immediately prior to the date on which a record is taken for
such Liquidating Dividend or, if no record is taken, the date as of which the
record holders of Common Stock entitled to such dividends or distribution are to
be determined.
8. Optional Redemption.
(a) At any time, the Company may, at its option, redeem all, but not less
than all, of the Warrant Shares for which the Registered Holder has not
exercised its right to be issued (the "Available Warrant Shares"), by paying
$3.33 per Available Warrant Share (subject to appropriate adjustment for stock
splits, stock dividends, combinations or other similar recapitalizations
affecting such shares) in cash for each Available Warrant Share then redeemed
(hereinafter referred to as the "Redemption Price"); provided, however, that the
Registered Holder may immediately exercise its Warrant or Warrants until such
time on or 15 days prior to the Redemption Date (as defined below).
(b) At least 15 days prior to the date fixed for any redemption of
Available Warrant Shares (hereinafter referred to as the "Redemption Date"),
written notice shall be mailed, by first class or registered mail, postage
prepaid, to the Registered Holder, notifying such holder of the election of the
Company to redeem such Available Warrant Shares, specifying the Redemption Date
and calling upon the Registered Holder to surrender to the Company, in the
manner and at the place designated, its Warrant or Warrants, representing the
Available Warrant Shares to be redeemed (such notice is hereinafter referred to
as the "Redemption Notice"). On or prior to the Redemption Date (subject to the
Registered Holder's right to exercise
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such Warrants prior to the Redemption Date), the Registered Holder shall
surrender its Warrant or Warrants representing Available Warrant Shares to the
Company, in the manner and at the place designated in the Redemption Notice, and
thereupon the Redemption Price of such shares shall be payable to the order of
the Registered Holder and each surrendered Warrant shall be cancelled. From and
after the Redemption Date, unless there shall have been a default in payment of
the Redemption Price (or the Registered Holder has exercised the Warrants prior
to such Redemption Date), all rights of the Registered Holder designated for
redemption in the Redemption Notice as the Registered Holder (except the right
to receive the Redemption Price without interest upon surrender of the Warrant)
shall cease with respect to the Warrant or Warrants representing the Available
Warrant Shares, and such Warrant or Warrants shall not thereafter be transferred
on the books of the Company or be deemed to be outstanding for any purpose
whatsoever.
9. Notices of Record Date, etc. In case:
(a) the Company shall take a record of the holders of its Common Stock (or
other stock or securities at the time deliverable upon the exercise of this
Warrant) for the purpose of entitling or enabling them to receive any dividend
or other distribution, or to receive any right to subscribe for or purchase any
shares of stock of any class or any other securities, or to receive any other
right; or
(b) of any capital reorganization of the Company, any reclassification of
the capital stock of the Company, any consolidation or merger of the Company
with or into another corporation (other than a consolidation or merger in which
the Company is the surviving entity), or any transfer of all or substantially
all of the assets of the Company; or
(c) of the voluntary or involuntary dissolution, liquidation or winding-up
of the Company, then, and in each such case, the Company will mail or cause to
be mailed to the Registered Holder of this Warrant a notice specifying, as the
case may be, (i) the date on which a record is to be taken for the purpose of
such dividend, distribution or right, and stating the amount and character of
such dividend, distribution or right, or (ii) the effective date on which such
reorganization, reclassification, consolidation, merger, transfer, dissolution,
liquidation or winding-up is to take place, and the time, if any is to be fixed,
as of which the holders of record of Common Stock (or such other stock or
securities at the time deliverable upon the exercise of this Warrant) shall be
entitled to exchange their shares of Common Stock (or such other stock or
securities) for securities or other property deliverable upon such
reorganization, reclassification, consolidation, merger, transfer, dissolution,
liquidation or winding-up. Such notice shall be mailed at least ten (10) days
prior to the record date or effective date for the event specified in such
notice.
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10. Reservation of Stock. The Company will at all times reserve and keep
available, solely for issuance and delivery upon the exercise of this Warrant,
such number of Warrant Shares and other stock, securities and property, as from
time to time shall be issuable upon the exercise of this Warrant.
11. Exchange of Warrants. Upon the surrender by the Registered Holder of
any Warrant or Warrants, properly endorsed, to the Company at the principal
office of the Company, the Company will, subject to the provisions of Section 5
hereof, issue and deliver to or upon the order of such Registered Holder, at the
Company's expense, a new Warrant or Warrants of like tenor, in the name of such
Registered Holder or as such Registered Holder (upon payment by such Registered
Holder of any applicable transfer taxes) may direct, calling in the aggregate on
the face or faces thereof for the number of shares of Common Stock called for on
the face or faces of the Warrant or Warrants so surrendered.
12. Replacement of Warrants. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and (in the case of loss, theft or destruction) upon delivery of an
indemnity agreement (with surety if reasonably required) in an amount reasonably
satisfactory to the Company, or (in the case of mutilation) upon surrender and
cancellation of this Warrant, the Company will issue, in lieu thereof, a new
Warrant of like tenor.
13. Transfers, etc.
(a) The Company will maintain a register containing the name and address of
the Registered Holder of this Warrant. Any Registered Holder may change its or
his address as shown on the warrant register by written notice to the Company
requesting such change.
(b) Subject to the provisions of Section 5 hereof, this Warrant and all
rights hereunder are transferable, in whole or in part, upon surrender of this
Warrant with a properly executed assignment (in the form of Exhibit II hereto)
at the principal office of the Company.
(c) Until any transfer of this Warrant is made in the warrant register, the
Company may treat the Registered Holder of this Warrant as the absolute owner
hereof for all purposes; provided, however, that if and when this Warrant is
properly assigned in blank, the Company may (but shall not be obligated to)
treat the bearer hereof as the absolute owner hereof for all purposes,
notwithstanding any notice to the contrary.
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14. Mailing of Notices, etc. All notices and other communications from the
Company to the Registered Holder of this Warrant shall be mailed by first-class
certified or registered mail, postage prepaid, to the address furnished to the
Company in writing by the last Registered Holder of this Warrant who shall have
furnished an address to the Company in writing. All notices and other
communications from the Registered Holder of this Warrant or in connection
herewith to the Company shall be mailed by first-class certified or registered
mail, postage prepaid, to the Company at its principal office set forth below.
If the Company should at any time change the location of its principal office to
a place other than as set forth below, it shall give prompt written notice to
the Registered Holder of this Warrant and thereafter all references in this
Warrant to the location of its principal office at the particular time shall be
as so specified in such notice.
15. No Rights as Stockholder. Until the exercise of this Warrant, the
Registered Holder of this Warrant shall not have or exercise any rights by
virtue hereof as a stockholder of the Company.
16. Change or Waiver. Any term of this Warrant may be changed or waived
only by an instrument in writing signed by the party against which enforcement
of the change or waiver is sought.
17. Headings. The headings in this Warrant are for purposes of reference
only and shall not limit or otherwise affect the meaning of any provision of
this Warrant.
18. Governing Law. This Warrant will be governed by and construed in
accordance with the laws of Delaware.
19. Registration Rights.
(a) The Registered Holder shall have the registration rights with respect
to the Warrant Shares as specified in Section 9 of the Second Extension
Agreement.
(b) Furthermore, the Registered Holder shall be entitled to "piggyback"
registration rights for so long as the Registered Holder shall own Warrant
Shares. Whenever the Company proposes to file a Registration Statement (other
than pursuant to subsection 19(a) at any time and from time to time, it will,
prior to such filing, give written notice to the Registered Holder of its
intention to do so and, upon the written request of the Registered Holder given
within 20 days after the Company provides such notice (which request shall state
the intended method of disposition of such Registrable Shares), the Company
shall use its best efforts to cause all Registrable Shares which the Company has
been requested by such Registered Holder to register to be registered under the
Securities Act to the extent necessary to
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permit their sale or other disposition in accordance with the intended methods
of distribution specified in the request of the Registered Holder; provided that
the Company shall have the right to postpone or withdraw any registration
effected pursuant to this subsection 19(b) without obligation to the Registered
Holder or any persons or entities to which the rights under this Warrant are
transferred by the Registered Holder, its successors or assigns pursuant to
Section 13 hereof.
(c) In connection with any registration under subsection 19(b) involving an
underwriting, the Company shall not be required to include any Registrable
Shares in such registration unless the holders thereof accept the terms of the
underwriting as agreed upon between the Company and the underwriters selected by
it (provided that such terms must be consistent with this Warrant). If in the
opinion of the managing underwriter it is appropriate because of marketing
factors to limit the number of Registrable Shares to be included in the
offering, then the Company shall be required to include in the registration only
that number of Registrable Shares, if any, which the managing underwriter
believes should be included therein. If the number of Registrable Shares to be
included in the offering in accordance with the foregoing is less than the total
number of shares which the holders of Registrable Shares have requested to be
included, then the holders of Registrable Shares who have requested registration
and other holders of securities entitled to include them in such registration
shall participate in the registration pro rata based upon their total ownership
of shares of Common Stock (giving effect to the conversion into Common Stock of
all securities convertible thereinto). If any holder would thus be entitled to
include more securities than such holder requested to be registered, the excess
shall be allocated among other requesting holders pro rata in the manner
described in the preceding sentence.
20. Registration Procedures. If and whenever the Company is required by the
provisions of this Warrant to use to effect the registration of any of the
Registrable Shares under the Securities Act, the Company shall:
(a) furnish to the Registered Holder such number of copies as the
Registered Holder shall reasonably request of the prospectus, including a
preliminary prospectus and any amendments or supplements thereto, in
conformity with the requirements of the Securities Act;
(b) use its best efforts to register or qualify the Registrable Shares
covered by the Registration Statement under the securities laws of such
states as the Registered Holder shall reasonably request; provided,
however, that the Company shall not be required in connection with this
subsection 20(b) to qualify as a foreign corporation or execute a general
consent to service of process in any jurisdiction;
(c) promptly notify the Registered Holder, if the Company has
delivered preliminary or final prospectuses to the Registered Holder and
after having
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done so, the prospectus is amended to comply with the requirements of the
Securities Act and, if requested by the Company, the Registered Holder
shall immediately cease making offers or sales of Registrable Shares under
the Registration Statement and return all prospectuses to the Company. The
Company shall promptly provide the Registered Holder with revised
prospectuses and, following receipt of the revised prospectuses, the
Registered Holder shall be free to resume making offers and sales of the
Registrable Shares; and
(d) pay the expenses incurred by it in complying with its obligations
under this Warrant in connection with registration rights, including all
registration and filing fees, exchange listing fees, expenses for the
preparation of the Registration statement, prospectus and any amendments
and supplements thereto, printing and photocopy expenses, fees and expenses
of counsel for the Company, and fees and expenses of accountants for the
Company, but excluding: (i) selling commissions or underwriting discounts
incurred by the Registered Holder in connection with sales of Registrable
Shares under the Registration Statement and (ii) the fees and expenses of
any counsel retained by the Registered Holder.
21. Requirements of Registered Holder. The Company shall not be required to
effect the registration of any of the Registrable Shares under the Securities
Act pursuant to this Warrant unless:
(a) the Registered Holder owning such shares furnishes to the Company
in writing such information regarding such Registered Holder and the
proposed sale of Registrable Shares by such Registered Holder as the
Company may reasonably request in writing in connection with the filing of
a Registration Statement or as shall be required in connection therewith by
the Commission or any state securities law authorities; and
(b) Such Registered Holder shall have provided to the Company its
written agreement that in the event of any registration of any of the
Registrable Shares under the Securities Act pursuant to this Warrant, each
Registered Holder will indemnify the Company and its officers and directors
and each person, if any, who controls any thereof (within the meaning of
the Securities Act) against any and all claims, losses, damages and
liabilities (or actions in respect thereof) arising out of or based on any
untrue statement (or alleged untrue statement) of any material fact
contained in any prospectus or other document incident to any registration,
qualification or compliance (or in any related Registration Statement,
notification or the like) or any omission (or alleged omission) to state
therein any material fact required to be stated therein or necessary to
make the statement therein not misleading, and such Registered Holder will
reimburse the Company and each other person indemnified pursuant to this
Section 21 for any legal and any other expenses reasonably incurred in
connection with investigating or defending any such claim, loss, damage,
liability or action; provided, however, that this Section 21 shall apply
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only if (and only to the extent that) such statement or omission was made
in reliance upon written information furnished to the Company in an
instrument duly executed by such Registered Holder and stated to be
specifically for use in such prospectus or other document (or related
Registration Statement, notification or the like) or any amendment or
supplement thereto; and, provided further that each Registered Holder's
liability hereunder with respect to any particular registration shall be
limited to an amount equal to the net proceeds received by such Registered
Holder from the Registrable Securities sold by such Registered Holder in
such registration.
22. Indemnification by Company. In the event of any registration of any of
the Registrable Shares under the Securities Act pursuant to this Warrant, the
Company will indemnify each Registered Holder and each person who controls the
Registered Holder (within the meaning of the Securities Act) against any and all
claims, losses, damages and liabilities (or actions in respect thereof) arising
out of or based on any untrue statement (or alleged untrue statement) of any
material fact contained in any prospectus or other document incident to any
registration, qualification or compliance (or in any related Registration
Statement, notification or the like) or any omission (or alleged omission) to
state therein any material fact required to be stated therein or necessary to
make the statements therein not misleading, or any violation by the Company of
any rule or regulation promulgated under the Securities Act applicable to the
Company and relating to any action or inaction required of the Company in
connection with any such registration, qualification or compliance, and the
Company will reimburse each such Registered Holder and controlling person for
any legal and any other expenses reasonably incurred in connection with
investigating or defending any such claim, loss, damage, liability or action;
provided, however, that the Company will not be liable in any such case to the
extent that any such claim, loss, damage or liability arises out of or is based
on any untrue statement or omission based upon written information furnished to
the Company in an instrument duly executed by such Registered Holder or
controlling person and specifically for use in such prospectus or other
document.
IGI, INC.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chief Executive Officer
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EXHIBIT I
PURCHASE FORM
To:_________________ Dated:____________
The undersigned, pursuant to the provisions set forth in the attached
Warrant (No. ___), hereby irrevocably elects to purchase _____ shares of the
Common Stock covered by such Warrant. The undersigned herewith makes payment of
$____________, representing the full Exercise Price for such shares at the price
per share provided for in such Warrant. Such payment takes the form of (check
applicable box or boxes):
[_] $______ in lawful money of the United States; and/or
[_] The cancellation of such portion of the attached Warrant as is exercisable
for a total of _____ Warrant Shares (using a Fair Market Value of $_____
per share for purposes of this calculation).
Signature:_____________________
Address:______________________
______________________
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EXHIBIT II
ASSIGNMENT FORM
FOR VALUE RECEIVED, ________________________________________ hereby sells,
assigns and transfers all of the rights of the undersigned under the attached
Warrant (No. ____) with respect to the number of shares of Common Stock covered
thereby set forth below, unto:
Name of Assignee Address No. of Shares
---------------- ------- -------------
Dated:_____________________ Signature:___________________________
Dated:_____________________ Witness:_____________________________