EXHIBIT 4.3
EXHIBIT A
to Securities Purchase Agreement
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VOID AFTER 5:00 P.M., SAN FRANCISCO TIME,
ON JULY 1, 2004
THIS WARRANT AND THE SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES
OR ANY OTHER JURISDICTION. THE SECURITIES REPRESENTED HEREBY MAY NOT BE
OFFERED OR SOLD IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR
THE SECURITIES UNDER APPLICABLE SECURITIES LAWS UNLESS OFFERED, SOLD OR
TRANSFERRED PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THOSE LAWS.
Date: July 1, ▇▇▇▇
▇▇▇▇▇▇▇ INCORPORATED
SERIES 1 STOCK PURCHASE WARRANT
THIS CERTIFIES THAT, for value received, ____________________________, or
its registered assigns, is entitled to purchase from Identix Incorporated, a
corporation organized under the laws of the State of Delaware (the "Company"),
(A) at any time or from time to time during the A Warrant Exercise Period (as
defined in Section 2 below), up to _______ fully paid and nonassessable shares
(the "A Warrant Shares") of the Company's common stock, par value $.01 per share
(the "Common Stock"), at an exercise price per share equal to $11.18 (the "A
Warrant Exercise Price"), and (B) at any time or from time to time during the B
Warrant Exercise Period (as defined in Section 2 below), up to ______ fully paid
and nonassessable shares of Common Stock, (the "B Warrant Shares") at an
exercise price per share equal to $0.01 (the "B Warrant Exercise Price", and
together with the A Warrant Exercise Price, the "Exercise Prices"). The number
of shares of Common Stock purchasable hereunder (the "Warrant Shares") and the
Exercise Prices are subject to adjustment as provided in Section 4 hereof. The
term "Warrants" means this Warrant, the other Series 1 Warrants (the "Series 1
Warrants") and the Series 2 Warrants of the Company, all issued pursuant to that
certain Securities Purchase Agreement, dated as of June 30, 1999, by and among
the Company and the other signatories thereto (the "Securities Purchase
Agreement").
This Warrant is subject to the following terms, provisions and conditions:
1. Manner of Exercise; Issuance of Certificates; Payment for Shares.
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(a) Exercisable Portion of B Warrant Shares. If the "Market Price" (as
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defined in the Securities Purchase Agreement) for the Company's common stock on
the earlier of (x) the date the "Initial Registration Statement" (as that term
is defined in the Registration Rights Agreement) is declared effective by the
SEC, or (y) the date the Holder deems the B Warrant exercisable pursuant to
Section 2 hereof (the earlier to occur of (x) or (y) being the "Effective
Date"), is less than $8.71, the number of B Warrant Shares for which this
Warrant is exercisable shall be equal to (A) the quotient of the Holder's
Investment Amount (as defined in the Securities Purchase Agreement) divided by
the Market Price (as defined in the Securities Purchase Agreement) of the Common
Stock on the Effective Date less (B) the number of shares of Common Stock issued
to holder at the closing under the Securities Purchase Agreement (the
"Closing"), provided, however, that notwithstanding anything to the contrary in
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the foregoing, in no event shall the number of B Warrant Shares issuable upon
exercise of this Warrant plus the number of shares of Common Stock issued to the
holder at the Closing exceed the applicable maximum below:
(i) If the Effective Date is fifteen or fewer business days following
the day on which the Closing occurs (the "Closing Date"), this Warrant shall
not be exercisable for any B Warrant Shares and the holder's rights with respect
to any B Warrant Shares shall expire.
(ii) If the Effective Date is more than fifteen business days, but
fewer than 31 business days following the Closing Date, _________ shares of
Common Stock .
(iii) If the Effective Date is thirty-one or more business days
following the Closing Date, _________ shares of Common Stock.
Notwithstanding anything in the foregoing to the contrary, if the Market Price
for the Company's common stock on the Effective Date is greater than or equal to
the Market Price for the Company's common stock on the Closing Date, this
Warrant shall not be exercisable for any B Warrant Shares and the holder's
rights with respect to any B Warrant Shares shall expire.
(b) Exercise. Subject to the provisions hereof, including, without
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limitation, the limitations contained in Section 7 hereof, this Warrant may be
exercised, with respect to the A Warrant Shares, at any time or from time to
time during the A Warrant Exercise Period, and with respect to the B Warrant, at
any time or from time to time during the B Warrant Exercise Period, by the
holder hereof, in whole or in part, in accordance with the procedures set forth
in this Section 1. In order to exercise this Warrant, the holder shall (i)
deliver in accordance with Section 9 hereof, a copy of the fully executed
exercise agreement in the form attached hereto (the "Exercise Agreement"), to
the Company by 11:59 p.m. San Francisco, California time on the Exercise Date,
(ii) surrender or cause to be surrendered this Warrant along with a copy of the
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Exercise Agreement as soon as practicable thereafter (but in any event within
five (5) business days after the Exercise Date) to the Company at the Company's
principal executive offices (or such other office or agency of the Company as it
may designate by notice to the holder hereof) and (iii), unless this Warrant is
being exercised pursuant to the cashless exercise provisions of Section 11(c)
hereof, make payment to the Company in cash, by certified or official bank check
or by wire transfer for the account of the Company, of the applicable Exercise
Price for the Warrant Shares specified in the Exercise Agreement within three
(3) business days after the Exercise Date). The Warrant Shares so purchased
shall be deemed to be issued to the holder hereof or such holder's designee, as
the record owner of such shares, as of the close of business on the date on
which this Warrant shall have been surrendered and the completed Exercise
Agreement shall have been delivered and payment shall have been made for such
shares as set forth above or, if such day is not a business day, on the next
succeeding business day. The Warrant Shares so purchased, representing the
aggregate number of shares specified in the Exercise Agreement, shall be
delivered to the holder hereof within a reasonable time, not exceeding three (3)
business days, after this Warrant shall have been so exercised (the "Delivery
Period"). If the Company's transfer agent is participating in the Depository
Trust Company ("DTC") Fast Automated Securities Transfer program, and so long as
the certificates therefor are not required to bear a legend and the holder is
not obligated to return such certificate for the placement of a legend thereon,
the Company shall cause its transfer agent to electronically transmit the
Warrant Shares so purchased to the holder by crediting the account of the holder
or its nominee with DTC through its Deposit Withdrawal Agent Commission system
("DTC Transfer"). If the aforementioned conditions to a DTC Transfer are not
satisfied, the Company shall deliver to the holder physical certificates
representing the Warrant Shares so purchased. Further, the holder may instruct
the Company to deliver to the holder physical certificates representing the
Warrant Shares so purchased in lieu of delivering such shares by way of DTC
Transfer. Any certificates so delivered shall be in such denominations as may
be requested by the holder hereof, shall be registered in the name of such
holder or such other name as shall be designated by such holder and, following
the date on which the Warrant Shares have been registered under the Securities
Act pursuant to that certain Registration Rights Agreement, dated as of June 30,
1999, by and between the Company and the other signatories thereto (the
"Registration Rights Agreement") or otherwise may be sold by the holder pursuant
to Rule 144(k) promulgated under the Securities Act (or a successor rule), shall
not bear any restrictive legend. If this Warrant shall have been exercised only
in part, then, unless this Warrant has expired, the Company shall, at its
expense, at the time of delivery of such certificates, deliver to the holder a
new Warrant representing the number of shares with respect to which this Warrant
shall not then have been exercised.
(c) Default. If, at any time during the A Warrant Exercise Period or the B
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Warrant Exercise Period, a holder of this Warrant submits this Warrant, an
Exercise Agreement and payment to the Company of the applicable Exercise Price
for each of the Warrant Shares specified in the Exercise Agreement (or elects a
cashless exercise pursuant to Section 11(c) if applicable), and the Company
fails for any reason to deliver, on or prior to the tenth (10th) business day
following the expiration of the Delivery Period for such exercise, the number of
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shares of Common Stock to which the holder is entitled upon such exercise (an
"Exercise Default"), then the Company shall pay to the holder payments
("Exercise Default Payments") for an Exercise Default in the amount of (a)
(N/365), multiplied by (b) the Average Price (as defined in Section 4(i) hereof)
on the date the Exercise Agreement giving rise to the Exercise Default is
transmitted in accordance with this Section 1 (the "Exercise Default Date"),
multiplied by (c) the number of shares of Common Stock the Company failed to so
deliver in such Exercise Default, multiplied by (d) .18, where N = the number of
days from the Exercise Default Date to the date that the Company effects the
full issuance and delivery of the Warrant Shares which gave rise to the Exercise
Default. The accrued Exercise Default Payment for each thirty day period shall
be paid in cash or Common Stock, at the holder's election, as follows:
(x) Unless otherwise agreed to by the parties, cash payment shall be
made to the holder on the fifth day after the end of each successive thirty day
(or shorter) period during the continuance of the Exercise Default; and
(y) In the event the holder and the Company mutually agree that the
holder may take such payment in Common Stock rather than cash, the Company shall
issue to holder the number of shares of Common Stock equal to the amount of such
Exercise Default Payment divided by the Average Price (as defined in Section
4(i)) (as in effect at the time of conversion) on the fifth day after the end of
each thirty day (or shorter) period during the continuance of the Exercise
Default, which shares of Common Stock shall be delivered within two (2) business
days thereafter.
Nothing herein shall limit the holder's right to pursue actual damages for
the Company's failure to maintain a sufficient number of authorized shares of
Common Stock as required pursuant to the terms of Section 3(b) hereof or to
otherwise issue shares of Common Stock upon exercise of this Warrant in
accordance with the terms hereof, and the holder shall have the right to pursue
all remedies available at law or in equity (including a decree of specific
performance and/or injunctive relief).
2. Period of Exercise. The A Warrant may be exercised at any time or from
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time to time during the period (the "A Warrant Exercise Period") beginning on
(a) the Closing Date and ending (b) at 5:00 p.m., San Francisco, California
time, on the fifth anniversary of the date of original issuance hereof, and the
B Warrant may be exercised at any time or from time to time during the period
(the "B Warrant Exercise Period") beginning on (a) the date the Initial
Registration Statement is declared effective by the SEC and ending (b) at 5:00
p.m., San Francisco, California time, on the fifth business day following such
date provided, however, that in the event the Initial Registration Statement has
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not been declared effective by the SEC within 90 days of the date hereof, the
holder may at any time thereafter but before the one year anniversary of the
Closing, by written notice delivered to the Company, deem the B Warrant
exercisable on the date of such notice and the B Warrant shall expire five
business days thereafter, provided further, that if such election has not been
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made before the one year
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anniversary of the Closing, then the B Warrant will automatically be deemed
exercisable on such one year anniversary and the B Warrant shall expire five
business days thereafter.
3. Certain Agreements of the Company. The Company hereby covenants and
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agrees as follows:
(a) Shares to be Fully Paid. All Warrant Shares will, upon issuance
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in accordance with the terms of this Warrant, be validly issued, fully paid and
nonassessable and free from all taxes, liens, claims and encumbrances.
(b) Reservation of Shares. During the period (the "Investment
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Period") beginning on the Closing Date and ending upon the expiration of both
the A Warrant Exercise Period and the B Warrant Exercise Period, the Company
shall at all times have authorized, and reserved for the purpose of issuance
upon exercise of this Warrant, a sufficient number of shares of Common Stock to
provide for the exercise in full of this Warrant (without giving effect to the
limitations on exercise set forth in Section 7(g) hereof).
(c) Listing. The Company has secured the listing of the shares of
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Common Stock issuable upon exercise of or otherwise pursuant to this Warrant
upon each national securities exchange or automated quotation system, if any,
upon which shares of Common Stock are then listed or become listed (subject to
official notice of issuance upon exercise of this Warrant) and shall maintain,
so long as any other shares of Common Stock shall be so listed, such listing of
all shares of Common Stock from time to time issuable upon the exercise of or
otherwise pursuant to this Warrant; and the Company shall so list on each
national securities exchange or automated quotation system, as the case may be,
and shall maintain such listing of, any other shares of capital stock of the
Company issuable upon the exercise of or otherwise pursuant to this Warrant if
and so long as any shares of the same class shall be listed on such national
securities exchange or automated quotation system.
(d) Certain Actions Prohibited. The Company will not avoid or seek to
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avoid the observance or performance of any of the terms to be observed or
performed by it hereunder, but will at all times in good faith assist in the
carrying out of all the provisions of this Warrant and in the taking of all such
action as may reasonably be requested by the holder of this Warrant in order to
protect the economic benefit inuring to the holder hereof and the exercise
privilege of the holder of this Warrant against dilution or other impairment,
consistent with the tenor and purpose of this Warrant. Without limiting the
generality of the foregoing, the Company (i) will not increase the par value of
any shares of Common Stock receivable upon the exercise of this Warrant above
the lowest Exercise Price then in effect, and (ii) will take all such actions 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.
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(e) Successors and Assigns. This Warrant will be binding upon any
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entity succeeding to the Company by merger, consolidation, or acquisition of all
or substantially all of the Company's assets.
(f) Blue Sky Laws. The Company shall, on or before the date of
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issuance of any Warrant Shares, take such actions as the Company shall
reasonably determine are necessary to qualify the Warrant Shares for, or obtain
exemption for the Warrant Shares for, sale to the holder of this Warrant upon
the exercise hereof under applicable securities or "blue sky" laws of the states
of the United States, and shall provide evidence of any such action so taken to
the holder of this Warrant prior to such date; provided, however, that the
Company shall not be required to qualify as a foreign corporation or file a
general consent to service of process in any such jurisdiction.
4. Antidilution Provisions. During the Investment Period, the Exercise
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Prices and the number of Warrant Shares issuable upon the exercise of this
Warrant, shall be subject to adjustment from time to time as provided in this
Section 4.
In the event that any adjustment of any Exercise Price as required
herein results in a fraction of a cent, such Exercise Price shall be rounded up
or down to the nearest cent.
(a) Subdivision or Combination of Common Stock. If the Company, at
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any time, subdivides (by any stock split, stock dividend, recapitalization,
reorganization, reclassification or otherwise) its shares of Common Stock into a
greater number of shares, then, after the date of record for effecting such
subdivision, the Exercise Prices in effect immediately prior to such subdivision
will be proportionately reduced. If the Company, at any time during the
Investment Period, combines (by reverse stock split, recapitalization,
reorganization, reclassification or otherwise) its shares of Common Stock into a
smaller number of shares, then, after the date of record for effecting such
combination, the Exercise Prices in effect immediately prior to such combination
will be proportionately increased.
(b) Adjustment in Number of Shares. Upon each adjustment of an
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Exercise Price pursuant to the provisions of this Section 4, the number of
shares of Common Stock issuable upon exercise of this Warrant shall be increased
or decreased to equal the quotient obtained by dividing (i) the product of (A)
the Exercise Price in effect immediately prior to such adjustment, multiplied by
(B) the number of shares of Common Stock issuable upon exercise of this Warrant
immediately prior to such adjustment, by (ii) the adjusted Exercise Price.
(c) Consolidation, Merger or Sale. In case of any consolidation of
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the Company with, or merger of the Company into, any other entity, or in case of
any sale or conveyance of all or substantially all of the assets of the Company
other than in connection with a plan of complete liquidation of the Company at
any time during the Investment Period, then as a condition of such
consolidation, merger or sale or conveyance, adequate provision will be made
whereby the holder of this Warrant will have the right to acquire and receive
upon exercise of
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this Warrant in lieu of the shares of Common Stock immediately theretofore
acquirable upon the exercise of this Warrant, such shares of stock, securities,
cash or assets as may be issued or payable with respect to or in exchange for
the number of shares of Common Stock immediately theretofore acquirable and
receivable upon exercise of this Warrant had such consolidation, merger or sale
or conveyance not taken place. In any such case, the Company will make
appropriate provision to insure that the provisions of this Section 4 will
thereafter be applicable as nearly as may be in relation to any shares of stock
or securities thereafter deliverable upon the exercise of this Warrant. The
Company will not effect any consolidation, merger or sale or conveyance unless
prior to the consummation thereof, the successor entity (if other than the
Company) assumes by written instrument the obligations under this Warrant and
the obligations to deliver to the holder of this Warrant such shares of stock,
securities or assets as, in accordance with the foregoing provisions, the holder
may be entitled to acquire.
(d) Distribution of Assets. In case the Company shall declare or make
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any distribution of its assets (or rights to acquire its assets) to holders of
Common Stock as a partial liquidating dividend, stock repurchase, by way of
return of capital or otherwise (including any dividend or distribution to the
Company's shareholders of cash or shares (or rights to acquire shares) of
capital stock of a subsidiary) (a "Distribution"), at any time during the
Investment Period, then, upon exercise of this Warrant for the purchase of any
or all of the shares of Common Stock subject hereto, the holder of this Warrant
shall be entitled to receive its pro-rata amount of such assets (or such rights)
as would have been payable to the holder had such holder been the holder of such
shares of Common Stock on the record date for the determination of shareholders
entitled to such Distribution.
(e) Notice of Adjustment. Upon the occurrence of any event which
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requires any adjustment of the Exercise Price, then, and in each such case, the
Company shall give notice thereof to the holder of this Warrant, which notice
shall state the Exercise Price resulting from such adjustment and the increase
or decrease in the number of Warrant Shares issuable upon exercise of this
Warrant, setting forth in reasonable detail the method of calculation and the
facts upon which such calculation is based. Such calculation shall be certified
by the chief financial officer of the Company.
(f) No Fractional Shares. No fractional shares of Common Stock are to
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be issued upon the exercise of this Warrant, but the Company shall pay a cash
adjustment in respect of any fractional share which would otherwise be issuable
in an amount equal to the same fraction of the Average Price of a share of
Common Stock on the date of such exercise.
(g) Other Notices. In case at any time:
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(i) the Company shall declare any dividend upon the Common Stock
payable in shares of stock of any class or make any other distribution (other
than dividends or distributions payable in cash out of retained earnings
consistent with the Company's past
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practices with respect to declaring dividends and making distributions and
rights issued pursuant to any "poison pill" plan adopted by the Board of
Directors) to the holders of the Common Stock;
(ii) the Company shall offer for subscription pro rata to the
holders of the Common Stock any additional shares of stock of any class or other
rights;
(iii) there shall be any capital reorganization of the Company, or
reclassification of the Common Stock, or consolidation or merger of the Company
with or into another corporation or entity such that the holders of the
Company's capital stock immediately prior to such transaction or series of
related transactions hold less than 50% of the capital stock of the surviving
corporation or entity immediately after such transaction or series of
transactions, or sale of all or substantially all of the Company's assets to
another corporation or entity; or
(iv) there shall be a voluntary or involuntary dissolution,
liquidation or winding-up of the Company;
then, in each such case, the Company shall give to the holder of this Warrant
(a) notice of the date or estimated date on which the books of the Company shall
close or a record shall be taken for determining the holders of Common Stock
entitled to receive any such dividend, distribution, or subscription rights or
for determining the holders of Common Stock entitled to vote in respect of any
such reorganization, reclassification, consolidation, merger, sale, dissolution,
liquidation or winding-up and (b) in the case of any such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation or
winding-up, notice of the date (or, if not then known, a reasonable estimate
thereof by the Company) when the same shall take place. Such notice shall also
specify the date on which the holders of Common Stock shall be entitled to
receive such dividend, distribution, or subscription rights or to exchange their
Common Stock for stock or other securities or property deliverable upon such
reorganization, reclassification, consolidation, merger, sale, dissolution,
liquidation, or winding-up, as the case may be. Such notice shall be given at
least twenty (20) days prior to the record date or the date on which the
Company's books are closed in respect thereto. Failure to give any such notice
or any defect therein shall not affect the validity of the proceedings referred
to in clauses (i), (ii), (iii) and (iv) above. Notwithstanding the foregoing,
the Company shall publicly disclose the events with respect to which any notice
delivered hereunder relates prior to delivery of such notice to the holder of
this Warrant.
(h) Certain Events. If, at any time during the Investment Period, any
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event occurs of the type contemplated by the adjustment provisions of this
Section 4 but not expressly provided for by such provisions, the Company will
give notice of such event as provided in Section 4(e) hereof, and the Company's
Board of Directors will make an appropriate adjustment in the Exercise Price and
the number of shares of Common Stock acquirable upon exercise of this Warrant so
that the rights of the holder shall be neither enhanced nor diminished by such
event.
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(i) Certain Definitions.
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(i) "Average Price" shall mean, with respect to any date of
determination, the lower of (i) the average Closing Price during the five (5)
Trading Days ending on the Trading Day immediately preceding such date of
determination or (ii) the Closing Price on the Trading Day immediately preceding
such date of determination, and in each case appropriately adjusted to reflect
any stock dividend, stock split or similar transaction during either such
relevant period. The manner of determining the Average Price of the Common
Stock set forth in the foregoing definition shall apply with respect to any
other security in respect of which a determination as to market value must be
made hereunder.
(ii) "business day" means any day, other than a Saturday or
Sunday or a day on which banking institutions in the State of California are
authorized or obligated by law, regulation or executive order to close.
(iii) "Closing Price" shall mean for the Common Stock as of any
date, the closing bid price of such security on the principal United States
securities exchange or trading market on which such security is listed or traded
as reported by Bloomberg Financial Markets (or a comparable reporting service of
national reputation selected by the holder and reasonably acceptable to the
Company if Bloomberg Financial Markets is not then reporting closing bid prices
of such security) (collectively, "Bloomberg"), or if the foregoing does not
apply, the last reported sale price of such security in the over-the-counter
market on the electronic bulletin board for such security as reported by
Bloomberg, or, if no sale price is reported for such security by Bloomberg, the
average of the bid prices of any market makers for such security as reported in
the "pink sheets" by the National Quotation Bureau, Inc., in each case for such
date or, if such date was not a Trading Day (as defined below) for such
security, on the next preceding day which was a Trading Day provided such next
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preceding Trading Day occurred no more than 5 business days prior to the date
for which the Closing Price is being determined. If the Closing Price cannot be
calculated for a share of Common Stock as of either of such dates on any of the
foregoing bases, the Closing Price of such security on such date shall be the
fair market value as determined by an investment banking firm selected by the
holder and reasonably acceptable to the Company, with the costs of such
appraisal to be borne by the Company. The manner of determining the Closing
Price of the Common Stock set forth in the foregoing definition shall apply with
respect to any other security in respect of which a determination as to market
value must be made.
(iv) "Common Stock," for purposes of this Section 4, includes the
Common Stock and any additional class of stock of the Company having no
preference as to dividends or distributions on liquidation, provided that the
shares purchasable pursuant to this Warrant shall include only Common Stock in
respect of which this Warrant is exercisable, or shares resulting from any
subdivision or combination of such Common Stock, or in the case of any
reorganization, reclassification, consolidation, merger, or sale of the
character referred to in Section 4(c) hereof, the stock or other securities or
property provided for in such Section.
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(v) "SEC" shall mean the United States Securities and Exchange
Commission.
(vi) "Trading Day" shall mean a business day on which at least
10,000 shares of Common Stock are traded on the principal United States
securities exchange or trading market on which such security is listed or traded
as reported by Bloomberg.
(j) Minimum Adjustment of Exercise Price. No adjustment of any
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Exercise Price shall be made in an amount of less than 1% of such Exercise Price
in effect at the time such adjustment is otherwise required to be made, but any
such lesser adjustment shall be carried forward and shall be made at the time
and together with the next subsequent adjustment which, together with any
adjustments so carried forward, shall amount to not less than 1% of such
Exercise Price.
5. Issue Tax. The issuance of certificates for Warrant Shares upon the
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exercise of this Warrant shall be made without charge to the holder of this
Warrant or such shares for any issuance tax or other costs in respect thereof,
provided that the Company shall not be required to pay any tax which may be
payable in respect of any transfer involved in the issuance and delivery of any
certificate in a name other than the holder of this Warrant.
6. No Rights or Liabilities as a Shareholder. This Warrant shall not
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entitle the holder hereof to any voting rights or other rights as a shareholder
of the Company. No provision of this Warrant, in the absence of affirmative
action by the holder hereof to purchase Warrant Shares, and no mere enumeration
herein of the rights or privileges of the holder hereof, shall give rise to any
liability of such holder for the Exercise Price or as a shareholder of the
Company, whether such liability is asserted by the Company or by creditors of
the Company.
7. Transfer, Exchange, Redemption and Replacement of Warrant.
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(a) Restriction on Transfer. This Warrant and the rights granted to
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the holder hereof are transferable, in whole or in part, to any Permitted
Transferee (as defined in the Securities Purchase Agreement) upon surrender of
this Warrant, together with a properly executed assignment in the form attached
hereto, at the office or agency of the Company referred to in Section 7(e)
below, provided, however, that any transfer or assignment shall be subject to
the conditions set forth in Sections 7(f) and 7(g) hereof and to the provisions
of Sections 3(e) and 3(f) of the Securities Purchase Agreement. Until due
presentment for registration of transfer on the books of the Company, the
Company may treat the registered holder hereof as the owner and holder hereof
for all purposes, and the Company shall not be affected by any notice to the
contrary. Notwithstanding anything to the contrary contained herein, the
registration rights
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described in Section 8 hereof are assignable only in accordance with the
provisions of the Registration Rights Agreement.
(b) Warrant Exchangeable for Different Denominations. This Warrant is
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exchangeable, upon the surrender hereof by the holder hereof at the office or
agency of the Company referred to in Section 7(e) below, for new Series 1
Warrants of like tenor of different denominations representing in the aggregate
the right to purchase the number of shares of Common Stock which may be
purchased hereunder, each of such new Series 1 Warrants to represent the right
to purchase such number of shares as shall be designated by the holder hereof at
the time of such surrender.
(c) Replacement of Warrant. Upon receipt of evidence reasonably
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satisfactory to the Company of the loss, theft, destruction, or mutilation of
this Warrant and, in the case of any such loss, theft, or destruction, upon
delivery of an indemnity agreement reasonably satisfactory in form and amount to
the Company, or, in the case of any such mutilation, upon surrender and
cancellation of this Warrant, the Company, at its expense, will execute and
deliver, in lieu thereof, a new Warrant of like tenor.
(d) Cancellation; Payment of Expenses. Upon the surrender of this
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Warrant in connection with any transfer, exchange, or replacement as provided in
this Section 7, this Warrant shall be promptly canceled by the Company. The
Company shall pay all taxes (other than securities transfer taxes or income
taxes) and all other expenses (other than legal expenses, if any, incurred by
the holder or transferees) and charges payable in connection with the
preparation, execution, and delivery of Series 1 Warrants pursuant to this
Section 7.
(e) Warrant Register. The Company shall maintain, at its principal
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executive offices (or such other office or agency of the Company as it may
designate by notice to the holder hereof), a register for this Warrant, in which
the Company shall record the name and address of the person in whose name this
Warrant has been issued, as well as the name and address of each transferee and
each prior owner of this Warrant.
(f) Exercise or Transfer Without Registration. If, at the time of the
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surrender of this Warrant in connection with any exercise, transfer, or exchange
of this Warrant, this Warrant (or, in the case of any exercise, the Warrant
Shares issuable hereunder), shall not be registered under the Securities Act and
under applicable state securities or blue sky laws, the Company may require, as
a condition of allowing such exercise, transfer, or exchange, (i) that the
holder or transferee of this Warrant, as the case may be, furnish to the Company
a written opinion of counsel (which opinion shall be in form, substance and
scope customary for opinions of counsel in comparable transactions) to the
effect that such exercise, transfer, or exchange may be made without
registration under the Securities Act and under applicable state securities or
blue sky laws, (ii) that the holder or transferee execute and deliver to the
Company an investment letter in form and substance reasonably acceptable to the
Company and (iii) that the transferee be an "accredited investor" as defined in
Rule 501(a) promulgated under the Securities Act;
11
provided that no such opinion, letter, or status as an "accredited investor"
shall be required in connection with a transfer pursuant to Rule 144 under the
Securities Act.
(g) Additional Restrictions on Exercise or Transfer. Notwithstanding
-----------------------------------------------
anything contained herein to the contrary, that portion of this Warrant
exercisable for A Warrant Shares, shall not be exercisable by a holder hereof to
the extent (but only to the extent) that (a) the number of shares of Common
Stock beneficially owned by such holder and its affiliates and (b) the number
of shares of Common Stock issuable upon exercise of this Warrant (or portion
thereof) with respect to which the determination described herein is being made,
would result in beneficial ownership by such holder and its affiliates of more
than 4.99% of the outstanding shares of Common Stock. To the extent the above
limitation applies, the determination of whether and to what extent this Warrant
shall be exercisable with respect to other securities owned by such holder shall
be in the sole discretion of the holder and submission of this Warrant for full
or partial exercise shall be deemed to be the holder's determination of whether
and the extent to which this Warrant is exercisable, in each case subject to
such aggregate percentage limitation. No prior inability to exercise the
Warrants pursuant to this Section shall have any effect on the applicability of
the provisions of this Section with respect to any subsequent determination of
exercisability. For purposes of the immediately preceding sentence, beneficial
ownership shall be determined in accordance with Section 13(d) of the Securities
Exchange Act of 1934, as amended, and Regulation 13D-G thereunder. The
restrictions contained in this Section 7(g) may not be amended without the
consent of the holder of this Warrant and the holders of a majority of the
Company's then outstanding Common Stock.
8. Registration Rights. The initial holder of this Warrant (and certain
-------------------
assignees thereof) is entitled to the benefit of such registration rights in
respect of the Warrant Shares as are set forth in the Registration Rights
Agreement, including the right to assign such rights to certain assignees, as
set forth therein.
9. Notices. Any notices required or permitted to be given under the terms
-------
of this Warrant shall be sent by certified or registered mail (return receipt
requested) or delivered personally or by courier or by confirmed telecopy, and
shall be effective five days after being placed in the mail, if mailed, one (1)
business day after being deposited with a nationally recognized overnight
delivery service, or immediately if delivered personally, by same-day courier or
by confirmed telecopy (such confirmation being conclusive proof of receipt and
delivery), in each case addressed to a party. The addresses for such
communications shall be:
If to the Company:
Identix Incorporated
▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇)▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
12
Attention: President
If to the holder, at such address as such holder shall have provided in writing
to the Company, or at such other address as such holder furnishes by notice
given in accordance with this Section 9.
10. Governing Law; Jurisdiction. This Warrant shall be governed by and
---------------------------
construed in accordance with the laws of the State of California applicable to
contracts made and to be performed in the State of California. Each of the
Company and the holder irrevocably consents to the jurisdiction of the United
States federal courts and state courts located in San Francisco, California in
any suit or proceeding based on or arising under this Warrant and irrevocably
agree that all claims in respect of such suit or proceeding shall be determined
in such courts. Each of the Company and the holder irrevocably waives any
objection to the laying of venue and the defense of an inconvenient forum to the
maintenance of such suit or proceeding. Each of the Company and the holder
further agrees that service of process upon it mailed by certified or registered
mail to the address set forth in Section 9 shall be deemed in every respect
effective service of process upon it in any such suit or proceeding. Nothing
herein shall affect the holder's right to serve process in any other manner
permitted by law. Each of the Company and the holder agrees that a final non-
appealable judgment in any such suit or proceeding shall be conclusive and may
be enforced in other jurisdictions by suit on such judgment or in any other
lawful manner.
11. Miscellaneous.
-------------
(a) Amendments. Except as provided in Section 7(g) hereof, this
----------
Warrant and any provision hereof may only be amended by an instrument in writing
signed by the Company and the holder hereof.
(b) Descriptive Headings. The descriptive headings of the several
--------------------
Sections of this Warrant are inserted for purposes of reference only, and shall
not affect the meaning or construction of any of the provisions hereof.
(c) Cashless Exercise. At any time after the Registration Deadline
-----------------
(as defined in the Registration Rights Agreement), provided that there is then
no effective registration statement covering the sale of the Warrant Shares, and
notwithstanding anything to the contrary contained in this Warrant, this Warrant
may be exercised for the purchase of Warrant Shares any time or from time to
time during the Warrant Exercise Period, by presentation and surrender of this
Warrant to the Company at its principal executive offices with a written notice
of the holder's intention to effect a cashless exercise, including a calculation
of the number of shares of Common Stock to be issued upon such exercise in
accordance with the terms hereof (a "Cashless Exercise"). In the event of a
Cashless Exercise, in lieu of paying the Warrant Exercise Price in cash, the
holder shall surrender this Warrant for that number of shares of Common Stock
determined by multiplying (i) the number of Warrant Shares to which it would
otherwise be entitled by (ii) a fraction, the numerator of which shall be the
difference between the then current
13
Average Price per share of the Common Stock and the Warrant Exercise Price, and
the denominator of which shall be the Average Price per share of Common Stock.
(d) HSR Act. The Company hereby acknowledges that exercise of this
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Warrant by holder may subject the Company and/or holder to the filing
requirements of the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of ▇▇▇▇ (▇▇▇
"▇▇▇ ▇▇▇") and that holder may be prevented from exercising this Warrant until
the expiration or early termination of all waiting periods imposed by the HSR
Act. The Company and the Holder each hereby covenant that it will use
reasonable commercial efforts to effect promptly all necessary or appropriate
registrations, filings and submissions that may be required pursuant to the HSR
Act in connection with the exercise of this Warrant.
(e) Partial Exercise. Upon any partial exercise of this Warrant, the
----------------
Company shall cancel the Warrant upon surrender thereof, and shall, within 2
business days of such surrender, execute and deliver a new Warrant of like tenor
and date for the balance of the outstanding Warrant Shares
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
14
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its
duly authorized officer.
IDENTIX INCORPORATED
By: _________________________________
Name:________________________________
Title:_______________________________
FORM OF EXERCISE AGREEMENT
(To be Executed by the Holder in order to Exercise the Warrant)
To: Identix Incorporated
▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: President
The undersigned hereby irrevocably exercises the right to purchase
_____________ shares of the Common Stock of Identix Incorporated, a corporation
organized under the laws of the State of Delaware (the "Company"), pursuant to
subclause ___ of the first paragraph of the attached Warrant and herewith makes
payment of the applicable Exercise Price with respect to such shares in full,
all in accordance with the conditions and provisions of said Warrant.
The undersigned agrees not to offer, sell, transfer or otherwise dispose of
any Common Stock obtained on exercise of the Warrant, except under circumstances
that will not result in a violation of the Securities Act of 1933, as amended,
or any state securities laws.
[_] The undersigned requests that the Company cause its transfer agent to
electronically transmit the Common Stock issuable pursuant to this Exercise
Agreement to the account of the undersigned or its nominee (which is
_________________) with DTC through its Deposit Withdrawal Agent Commission
System ("DTC Transfer").
[_] In lieu of receiving the shares of Common Stock issuable pursuant to this
Exercise Agreement by way of DTC Transfer, the undersigned hereby requests
that the Company cause its transfer agent to issue and deliver to the
undersigned physical certificates representing such shares of Common Stock.
15
The undersigned requests that a Warrant representing any unexercised
portion hereof be issued, pursuant to the Warrant, in the name of the Holder and
delivered to the undersigned at the address set forth below:
Dated:_________________ _____________________________________
Signature of Holder
_____________________________________
Name of Holder (Print)
Address:
_____________________________________
_____________________________________
_____________________________________
16
FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers
all the rights of the undersigned under the attached Warrant, with respect to
the number of shares of Common Stock covered thereby issuable pursuant to
subclause (i) of the first paragraph of the attached Warrant set forth
hereinbelow (plus a proportionate amount of shares issuable pursuant to
subclause (ii) of the first paragraph of the attached Warrant), to:
Name of Assignee Address No of Shares
---------------- ------- ------------
, and hereby irrevocably constitutes and appoints _____________________________
as agent and attorney-in-fact to transfer said Warrant on the books of the
within-named corporation, with full power of substitution in the premises.
Dated: ___________________, ____
In the presence of
__________________________
Name: ______________________________________
Signature: _______________________________
Title of Signing Officer or Agent (if any):
Address: ______________________________
______________________________
______________________________
Note: The above signature should
correspond exactly with the name
on the face of the within
Warrant.