Warrant No. [ ] ____________ Warrants
NEITHER
THESE SECURITIES NOR THE SECURITIES FOR WHICH THESE SECURITIES ARE EXERCISABLE
HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE
SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH APPLICABLE STATE
SECURITIES OR BLUE SKY LAWS. THESE SECURITIES AND THE SECURITIES ISSUABLE UPON
EXERCISE OF THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE
MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.
CHASE
PACKAGING CORPORATION
WARRANT
(Agreement
and Certificate)
|
Warrant
No. [ ]
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____________
Warrants
|
Chase
Packaging Corporation, a Texas corporation (the “Company”),
hereby certifies that, for value received,
______________________________________, or his, her, or its registered assigns
(the “Holder”),
is
the owner of that number of Warrants (the “Warrants”)
set
forth above and is entitled to purchase from the Company, for each Warrant
held,
one (1) share of common stock, $0.10 par value per share (the “Common
Stock”),
of
the Company (each such share, a “Warrant
Share”
and
all
such shares, the “Warrant
Shares”)
at an
exercise price equal to $0.15 per share (as adjusted from time to time as
provided in Section
9,
the
“Exercise
Price”),
at
any time and from time to time from and after the date hereof and through and
including the fifth anniversary of the date hereof (the “Expiration
Date”),
and
subject to the following terms and conditions. These Warrants are part of a
package of securities issued pursuant to that certain Securities Purchase and
Subscription Agreement (the “Purchase
Agreement”),
dated
as of the date hereof, by and among the Company and the Purchasers identified
therein. All such warrants are referred to herein, collectively, as the
“Warrants.”
1.
Definitions. In addition to the terms
defined elsewhere in this Warrant Agreement, capitalized terms that are not
otherwise defined herein have the meanings given to such terms in the Purchase
Agreement.
2.
Registration of Warrant. The Company
shall register these Warrants, upon records to be maintained by the Company
for
that purpose (the “Warrant Register”), in the name of the
record Holder hereof from time to time. The Company may deem and treat the
registered Holder of these Warrants as the absolute owner hereof for the purpose
of any exercise hereof or any distribution to the Holder, and for all other
purposes, absent actual notice to the contrary.
3.
Registration of Transfers. The Company
shall register the transfer of any portion of this Warrant Certificate in the
Warrant Register, upon surrender of this Warrant Certificate, with the Form
of
Assignment attached hereto duly completed and signed, to the Transfer Agent
or
to the Company at its address specified herein. Upon any such registration
or
transfer, a new warrant to purchase Common Stock, in substantially the form
of
this Warrant Certificate (any such new warrant, a “New
Warrant”), evidencing the portion of this Warrant Certificate so
transferred shall be issued to the transferee, and a New Warrant evidencing
the
remaining portion of this Warrant Certificate not so transferred, if any, shall
be issued to the transferring Holder. The acceptance of the New Warrant by
the
transferee thereof shall be deemed the acceptance by such transferee of all
of
the rights and obligations of a holder of this Warrant Certificate.
4.
Exercise and Duration of Warrants.
(a)
These
Warrants shall be exercisable by the registered Holder at any time and from
time
to time on or after the date hereof to and including the Expiration Date. At
6:30 P.M., New York City time on the Expiration Date, the portion of this
Warrant Certificate not exercised prior thereto shall be and become void and
of
no value; provided that, if the average of the Closing Prices for the five
Trading Days immediately prior to (but not including) the Expiration Date
exceeds the Exercise Price on the Expiration Date, then this Warrant Certificate
shall be deemed to have been exercised in full (to the extent not previously
exercised) on a “cashless exercise” basis at 6:30 P.M. New York City time on the
Expiration Date if a “cashless exercise” may occur at such time pursuant to
Section 10 below.
(b)
A
Holder
may exercise this Warrant Certificate by delivering to the Company: (i) an
exercise notice, in the form attached hereto (the “Exercise
Notice”),
appropriately completed and duly signed; and (ii) payment of the Exercise
Price for the number of Warrant Shares as to which this Warrant Certificate
is
being exercised (which may take the form of a “cashless exercise” if so
indicated in the Exercise Notice and if a “cashless exercise” may occur at such
time pursuant to Section 10 below), and the date such items are delivered to
the
Company (as determined in accordance with the notice provisions hereof) is
an
“Exercise
Date.”
The
Holder shall not be required to deliver the original Warrant Certificate in
order to effect an exercise hereunder.
5.
Delivery of Warrant Shares.
(a)
Upon
exercise of this Warrant Certificate, the Company shall promptly (but in no
event later than three Trading Days after the Exercise Date) issue or cause
to
be issued, and cause to be delivered to or upon the written order of the Holder
and in such name or names as the Holder may designate, a certificate for the
Warrant Shares issuable upon such exercise, free of restrictive legends unless
a
registration statement covering the resale of the Warrant Shares and naming
the
Holder as a selling stockholder thereunder is not then effective and the Warrant
Shares are not freely transferable without volume restrictions pursuant to
Rule
144 under the Securities Act. The Holder, or any Person so designated by the
Holder to receive Warrant Shares, shall be deemed to have become the holder
of
record of such Warrant Shares as of the Exercise Date.
2
(b)
This
Warrant Certificate is exercisable either in its entirety or, from time to
time,
for a portion of the number of Warrant Shares. Upon surrender of this Warrant
Certificate following one or more partial exercises, the Company shall issue
or
cause to be issued, at its expense, a New Warrant evidencing the right to
purchase the remaining number of Warrant Shares.
(c)
The
Company’s obligations to issue and deliver Warrant Shares in accordance with the
terms hereof are absolute and unconditional, irrespective of any action or
inaction by the Holder to enforce the same, any waiver or consent with respect
to any provision hereof, the recovery of any judgment against any Person or
any
action to enforce the same, or any setoff, counterclaim, recoupment, limitation,
or termination, or any breach or alleged breach by the Holder or any other
Person of any obligation to the Company or any violation or alleged violation
of
law by the Holder or any other Person, and irrespective of any other
circumstance which might otherwise limit such obligation of the Company to
the
Holder in connection with the issuance of Warrant Shares. Nothing herein shall
limit a Xxxxxx’s right to pursue any other remedies available to him, her, or it
hereunder, at law or in equity including, without limitation, a decree of
specific performance and/or injunctive relief with respect to the Company’s
failure to timely deliver certificates representing shares of Common Stock
upon
exercise of the Warrant Certificate as required pursuant to the terms
hereof.
6.
Charges, Taxes, and Expenses. Issuance
and delivery of certificates for shares of Common Stock upon exercise of this
Warrant Certificate shall be made without charge to the Holder for any issue
or
transfer tax, withholding tax, transfer agent fee, or other incidental tax
or
expense in respect of the issuance of such certificates, all of which taxes
and
expenses shall be paid by the Company; provided, however, that the Company
shall
not be required to pay any tax which may be payable in respect of any transfer
involved in the registration of any certificates for Warrant Shares or Warrants
in a name other than that of the Holder or an Affiliate thereof. The Holder
shall be responsible for all other tax liability that may arise as a result
of
holding or transferring this Warrant Certificate or receiving Warrant Shares
upon exercise hereof.
7.
Replacement of Warrant Certificate. If
this Warrant Certificate is mutilated, lost, stolen, or destroyed, the Company
shall issue or cause to be issued, in exchange and substitution for and upon
cancellation hereof or in lieu of and substitution for this Warrant Certificate,
a New Warrant, but only upon receipt of evidence reasonably satisfactory to
the
Company of such loss, theft, or destruction and customary and reasonable bond
or
indemnity, if requested. Applicants for a New Warrant under such circumstances
shall also comply with such other reasonable regulations and procedures and
pay
such other reasonable third-party costs as the Company may
prescribe.
8.
Reservation of Warrant Shares. The
Company covenants that it will at all times reserve and keep available out
of
the aggregate of its authorized but unissued and otherwise unreserved Common
Stock, solely for the purpose of enabling it to issue Warrant Shares upon
exercise of this Warrant Certificate as herein provided, the number of Warrant
Shares which are then issuable and deliverable upon the exercise of this entire
Warrant Certificate, free from preemptive rights or any other contingent
purchase rights of persons other than the Holder (taking into account the
adjustments and restrictions of Section 9). The Company covenants that
all Warrant Shares so issuable and deliverable shall, upon issuance and the
payment of the applicable Exercise Price in accordance with the terms hereof,
be
duly and validly authorized, issued, and fully paid and nonassessable. The
Company will take all such actions as may be necessary to assure that such
shares of Common Stock may be issued as provided herein without violation of
any
applicable law or regulation or of any requirements of any securities exchange
or automated quotation system upon which the Common Stock may be
listed.
3
9.
Certain Adjustments. The Exercise Price
and number of Warrant Shares issuable upon exercise of this Warrant Certificate
are subject to adjustment from time to time as set forth in this Section
9.
(a)
Stock
Dividends and Splits. If
the Company, at any time while this Warrant Certificate is outstanding:
(i) pays a stock dividend on its Common Stock or otherwise makes a
distribution on any class of capital stock that is payable in shares of Common
Stock; (ii) subdivides outstanding shares of Common Stock into a larger
number of shares; or (iii) combines outstanding shares of Common Stock into
a smaller number of shares, then in each such case the Exercise Price shall
be
multiplied by a fraction of which the numerator shall be the number of shares
of
Common Stock outstanding immediately before such event and of which the
denominator shall be the number of shares of Common Stock outstanding
immediately after such event. Any adjustment made pursuant to clause (i) of
this
paragraph shall become effective immediately after the record date for the
determination of stockholders entitled to receive such dividend or distribution,
and any adjustment pursuant to clause (ii) or (iii) of this paragraph shall
become effective immediately after the effective date of such subdivision or
combination.
(b)
Pro
Rata Distributions. If
the Company, at any time while this Warrant Certificate is outstanding,
distributes to all holders of Common Stock: (i) evidences of its
indebtedness; (ii) any security (other than a distribution of Common Stock
covered by the preceding paragraph); (iii) rights or warrants to subscribe
for or purchase any security; or (iv) any other asset (in each case,
“Distributed
Property”),
then
in each such case the Exercise Price in effect immediately prior to the record
date fixed for determination of stockholders entitled to receive such
distribution shall be adjusted (effective on such record date) to equal the
product of such Exercise Price times a fraction of which the denominator shall
be the average of the Closing Prices for the five Trading Days immediately
prior
to (but not including) such record date and of which the numerator shall be
such
average less the then fair market value of the Distributed Property distributed
in respect of one outstanding share of Common Stock, as determined by the
Company’s independent certified public accountants that regularly examine the
financial statements of the Company (an “Appraiser”).
In
such event, the Holder, after receipt of the determination by the Appraiser,
shall have the right to select an additional appraiser (which shall be a
nationally recognized accounting firm), in which case such fair market value
shall be deemed to equal the average of the values determined by each of the
Appraiser and such appraiser. As an alternative to the foregoing adjustment
to
the Exercise Price, at the request of the Holder delivered before the 90th
day
after such record date the Company will deliver to such Holder, the Distributed
Property that such Holder would have been entitled to receive in respect of
the
Warrant Shares for which this Warrant Certificate could have been exercised
immediately prior to such record date, upon any exercise of the Warrant
Certificate that occurs after such record date.
4
(c)
Fundamental
Transactions. If,
at any time while this Warrant Certificate is outstanding: (i) the Company
effects any merger or consolidation of the Company with or into another Person;
(ii) the Company effects any sale of all or substantially all of its assets
in
one or a series of related transactions; (iii) any tender offer or exchange
offer (whether by the Company or another Person) is completed pursuant to which
holders of Common Stock are permitted to tender or exchange their shares for
other securities, cash or property; or (iv) the Company effects any
reclassification of the Common Stock or any compulsory share exchange pursuant
to which the Common Stock is effectively converted into or exchanged for other
securities, cash, or property (other than as a result of a subdivision or
combination of shares of Common Stock covered by Section 9(a) above) (in any
such case, a “Fundamental
Transaction”),
then
the Holder shall have the right thereafter to receive, upon exercise of this
Warrant Certificate, the same amount and kind of securities, cash, or property
as it would have been entitled to receive upon the occurrence of such
Fundamental Transaction if it had been, immediately prior to such Fundamental
Transaction, the holder of the number of Warrant Shares then issuable upon
exercise in full of this Warrant Certificate (the “Alternate
Consideration”).
The
aggregate Exercise Price for this Warrant Certificate will not be affected
by
any such Fundamental Transaction, but the Company shall apportion such aggregate
Exercise Price among the Alternate Consideration in a reasonable manner
reflecting the relative value of any different components of the Alternate
Consideration. If holders of Common Stock are given any choice as to the
securities, cash, or property to be received in a Fundamental Transaction,
then
the Holder shall be given the same choice as to the Alternate Consideration
it
receives upon any exercise of this Warrant Certificate following such
Fundamental Transaction. In the event of a Fundamental Transaction, the Company
or the successor or purchasing Person, as the case may be, shall execute with
the Holder a written agreement providing that:
(x) this
Warrant Certificate shall thereafter entitle the Holder to purchase the
Alternate Consideration in accordance with this section 9(c),
(y) in
the
case of any such successor or purchasing Person, upon such consolidation,
merger, statutory exchange, combination, sale, or conveyance such successor
or
purchasing Person shall be jointly and severally liable with the Company for
the
performance of all of the Company’s obligations under this Warrant Certificate
and the Purchase Agreement, and
(z) if
registration or qualification is required under the Securities Act or applicable
state law for the public resale by the Holder of shares of stock and other
securities so issuable upon exercise of this Warrant Certificate, all rights
applicable to registration of the Common Stock issuable upon exercise of this
Warrant Certificate shall apply to the Alternate Consideration.
5
If,
in
the case of any Fundamental Transaction, the Alternate Consideration includes
shares of stock, other securities, other property or assets of a Person other
than the Company or any such successor or purchasing Person, as the case may
be,
in such Fundamental Transaction, then such written agreement shall also be
executed by such other Person and shall contain such additional provisions
to
protect the interests of the Holder as the Board of Directors of the Company
shall reasonably consider necessary by reason of the foregoing. At the Holder’s
request, any successor to the Company or surviving entity in such Fundamental
Transaction shall issue to the Holder a new warrant consistent with the
foregoing provisions and evidencing the Holder’s right to purchase the Alternate
Consideration for the aggregate Exercise Price upon exercise thereof. The terms
of any agreement pursuant to which a Fundamental Transaction is effected shall
include terms requiring any such successor or surviving entity to comply with
the provisions of this paragraph (c) and insuring that the Warrant Certificate
(or any such replacement security) will be similarly adjusted upon any
subsequent transaction analogous to a Fundamental Transaction. If any
Fundamental Transaction constitutes or results in a Change of Control, then
at
the request of the Holder delivered before the 30th
day
after such Fundamental Transaction, the Company (or any such successor or
surviving entity) shall purchase the Warrant from the Holder for a purchase
price, payable in cash within five Trading Days after such request (or, if
later, on the effective date of the Fundamental Transaction), equal to the
Black-Scholes value (calculated in accordance with Bloomberg, L.P. using a
180
day historical volatility) of the remaining unexercised portion of this Warrant
Certificate on the date of such request in the case of a third party tender
offer, or, in the case of any other Fundamental Transaction, on the date of
the
execution of definitive documentation governing such Fundamental
Transaction.
(d)
Subsequent
Equity Sales.
(i) If,
at
any time while this Warrant Certificate is outstanding, the Company issues
additional shares of Common Stock or rights, warrants, options, or other
securities or debt convertible, exercisable, or exchangeable for shares of
Common Stock or otherwise entitling any Person to acquire shares of Common
Stock
(collectively, “Common
Stock Equivalents”)
at an
effective net price to the Company per share of Common Stock (the “Effective
Price”)
less
than the Exercise Price (as adjusted hereunder to such date), then the Exercise
Price shall be reduced to equal the Effective Price. For purposes of this
paragraph, in connection with any issuance of any Common Stock Equivalents:
(A) the maximum number of shares of Common Stock potentially issuable at
any time upon conversion, exercise, or exchange of such Common Stock Equivalents
(the “Deemed
Number”)
shall
be deemed to be outstanding upon issuance of such Common Stock Equivalents;
(B) the Effective Price applicable to such Common Stock shall equal the
minimum dollar value of consideration payable to the Company to purchase such
Common Stock Equivalents and to convert, exercise, or exchange them into Common
Stock (net of any discounts, fees, commissions, and other expenses), divided
by
the Deemed Number; and (C) no further adjustment shall be made to the
Exercise Price upon the actual issuance of Common Stock upon conversion,
exercise, or exchange of such Common Stock Equivalents. The Effective Price
of
Common Stock or Common Stock Equivalents issued in any transaction in which
more
than one type of securities are issued shall give effect to the allocation
by
the Company of the aggregate amount paid for such securities issued in such
transaction.
6
(ii) If,
at
any time while this Warrant Certificate is outstanding, the Company issues
Common Stock Equivalents with an Effective Price or a number of underlying
shares that floats or resets or otherwise varies or is subject to adjustment
based (directly or indirectly) on market prices of the Common Stock (a
“Floating
Price Security”),
then
for purposes of applying the preceding paragraph in connection with any
subsequent exercise, the Effective Price will be determined separately on each
Exercise Date and will be deemed to equal the lowest Effective Price at which
any holder of such Floating Price Security is entitled to acquire Common Stock
on such Exercise Date (regardless of whether any such holder actually acquires
any shares on such date).
(iii) Notwithstanding
the foregoing, no adjustment will be made under this paragraph in respect of
any
Excluded Stock (see definition contained in the Securities Purchase and
Subscription Agreement referred to in section 15 hereof).
(e)
Number
of Warrant Shares. Simultaneously
with any adjustments to the Exercise Price pursuant to paragraphs (a), (b),
or
(d) of this Section, the number of Warrant Shares that may be purchased upon
exercise of this Warrant Certificate shall be increased or decreased
proportionately, so that after such adjustment the aggregate Exercise Price
payable hereunder for the increased or decreased number of Warrant Shares shall
be the same as the aggregate Exercise Price in effect immediately prior to
such
adjustment.
(f)
Calculations. All
calculations under this Section
9
shall be
made to the nearest cent or the nearest 1/100th of a share, as applicable.
The
number of shares of Common Stock outstanding at any given time shall not include
shares owned or held by or for the account of the Company, and the disposition
of any such shares shall be considered an issue or sale of Common
Stock.
(g)
Notice
of Adjustments. Upon
the occurrence of each adjustment pursuant to this Section
9,
the
Company at its expense will promptly compute such adjustment in accordance
with
the terms of this Warrant Certificate and prepare a certificate setting forth
such adjustment, including a statement of the adjusted Exercise Price and
adjusted number or type of Warrant Shares or other securities issuable upon
exercise of this Warrant Certificate (as applicable), describing the
transactions giving rise to such adjustments and showing in detail the facts
upon which such adjustment is based. Upon written request, the Company will
promptly deliver a copy of each such certificate to the Holder.
(h)
Notice
of Corporate Events. If
the Company: (i) declares a dividend or any other distribution of cash,
securities, or other property in respect of its Common Stock, including without
limitation any granting of rights or warrants to subscribe for or purchase
any
capital stock of the Company; (ii) authorizes or approves, enters into any
agreement contemplating or solicits stockholder approval for any Fundamental
Transaction; or (iii) authorizes the voluntary dissolution, liquidation, or
winding up of the affairs of the Company, then the Company shall deliver to
the
Holder a notice describing the material terms and conditions of such
transaction, at least 20 calendar days prior to the applicable record or
effective date on which a Person would need to hold Common Stock in order to
participate in, or vote with respect to, such transaction, and the Company
will
take all steps reasonably necessary in order to insure that the Holder is given
the practical opportunity to exercise this Warrant Certificate prior to such
time so as to participate in or vote with respect to such transaction; provided,
however, that the failure to deliver such notice or any defect therein shall
not
affect the validity of the corporate action required to be described in such
notice.
7
10.
Payment of Exercise Price. The Holder
shall pay the Exercise Price in immediately available funds; provided, however,
if at anytime after the Required Filing Date there is no effective Registration
Statement registering, or no current prospectus available for, the resale of
the
Warrant Shares by the Holder, the Holder may satisfy its obligation to pay
the
Exercise Price through a “cashless exercise,” in which event the Company shall
issue to the Holder the number of Warrant Shares determined as
follows:
|
X
=
Y [(A-B)/A]
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|
|
where:
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|
|
X
=
the number of Warrant Shares to be issued to the
Holder.
|
|
|
Y
=
the number of Warrant Shares with respect to which this Warrant
Certificate is being exercised.
|
|
|
A
=
the arithmetic average of the Closing Prices for the five Trading
Days
immediately prior to (but not including) the Exercise
Date.
|
|
|
B
=
the Exercise Price.
|
For
purposes of Rule 144 promulgated under the Securities Act, it is intended,
understood, and acknowledged that the Warrant Shares issued in a cashless
exercise transaction pursuant to this Section 10 shall be deemed to have
been acquired by the Holder, and the holding period for the Warrant Shares
shall
be deemed to have commenced, on the date this Warrant Certificate was originally
issued pursuant to the Purchase Agreement.
11.
Fractional Shares. The Company shall
not be required to issue or cause to be issued fractional Warrant Shares on
the
exercise of this Warrant Certificate. If any fraction of a Warrant Share would,
except for the provisions of this Section, be issuable upon exercise of this
Warrant Certificate, the number of Warrant Shares to be issued will be rounded
up to the nearest whole share.
12.
Notices. Any and all notices or other
communications or deliveries hereunder (including without limitation any
Exercise Notice) shall be in writing and shall be deemed given and effective
on
the earliest of: (i) the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile number specified in this Section
prior to 6:30 p.m. (New York City time) on a Trading Day; (ii) the next Trading
Day after the date of transmission, if such notice or communication is delivered
via facsimile at the facsimile number specified in this Section on a day that
is
not a Trading Day or later than 6:30 p.m. (New York City time) on any Trading
Day; (iii) the Trading Day following the date of mailing, if sent by nationally
recognized overnight courier service; or (iv) upon actual receipt by the party
to whom such notice is required to be given. The address for such notices or
communications shall be as set forth in the Purchase Agreement.
8
13.
Warrant Agent. The Company shall serve
as warrant agent under this Warrant Agreement. Upon 30 days’ notice to the
Holder, the Company may appoint a new warrant agent. Any corporation into which
the Company or any new warrant agent may be merged or any corporation resulting
from any consolidation to which the Company or any new warrant agent shall
be a
party or any corporation to which the Company or any new warrant agent transfers
substantially all of its corporate trust or shareholders services business
shall
be a successor warrant agent under this Warrant Agreement without any further
act. Any such successor warrant agent shall promptly cause notice of its
succession as warrant agent to be mailed (by first class mail, postage prepaid)
to the Holder at the Holder’s last address as shown on the Warrant
Register.
14.
SEC Registration. These Warrants are
being initially issued as part of a package of securities comprising certain
Units being offered and sold by the Company through, and by means of, a Private
Placement Memorandum. In connection that offering, each Purchaser will enter
into a Securities Purchase and Subscription Agreement and a Registration Rights
Agreement with the Company, the latter providing for each investor to have
certain SEC registration rights for both these Warrants and the other securities
comprising each Unit. With regard to such SEC registration rights, reference
is
hereby made to such Registration Rights Agreement, all of the provisions of
which are herein incorporated by reference.
15.
Miscellaneous.
(a)
Subject
to the restrictions on transfer set forth on the first page hereof, this Warrant
Certificate may be assigned by the Holder. This Warrant Certificate may not
be
assigned by the Company except to a successor in the event of a Fundamental
Transaction. This Warrant Certificate shall be binding on, and inure to the
benefit of, the parties hereto and their respective successors and assigns.
Subject to the preceding sentence, nothing in this Warrant Certificate shall
be
construed to give to any Person other than the Company and the Holder any legal
or equitable right, remedy, or cause of action under this Warrant Certificate.
This Warrant Agreement may be amended only in writing signed by the Company
and
the Holder or his, her, or its successors and assigns.
(b)
The
Company will not, by amendment of its governing documents or through any
reorganization, transfer of assets, consolidation, merger, dissolution, issue,
or sale of securities or any other voluntary action, avoid or seek to avoid
the
observance or performance of any of the terms of this Warrant Agreement, 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 against impairment. Without limiting the
generality of the foregoing, the Company: (i) will not increase the par value
of
any Warrant Shares above the amount payable therefor on such exercise; (ii)
will
take all such action as may be reasonably necessary or appropriate in order
that
the Company may validly and legally issue fully paid and nonassessable Warrant
Shares on the exercise of this Warrant Certificate; and (iii) will not close
its
shareholder books or records in any manner which interferes with the timely
exercise of this Warrant Certificate.
9
(c)
Governing
Law; Venue; Waiver Of Jury Trial. All
questions concerning the construction, validity, enforcement, and interpretation
of this Warrant Agreement shall be governed by, and construed and enforced
in
accordance with, the internal laws of the State of New York, without regard
to
the principles of conflicts of law thereof. Each party agrees that all legal
proceedings concerning the interpretations, enforcement, and defense of the
transactions contemplated by any of the Transaction Documents (whether brought
against a party hereto or his, her, or its respective Affiliates, directors,
officers, shareholders, employees, or agents) shall be commenced exclusively
in
the state and federal courts sitting in the City of New York, Borough of
Manhattan. Each party hereto hereby irrevocably submits to the exclusive
jurisdiction of the state and federal courts sitting in the City of New York,
Borough of Manhattan, for the adjudication of any dispute hereunder or in
connection herewith or with any transaction contemplated hereby or discussed
herein (including with respect to the enforcement of any of this Warrant
Agreement), and hereby irrevocably waives, and agrees not to assert in any
suit,
action, or proceeding, any claim that he, she, or it is not personally subject
to the jurisdiction of any such court or that such suit, action, or proceeding
is improper. Each party hereto hereby irrevocably waives personal service of
process and consents to process being served in any such suit, action, or
proceeding by mailing a copy thereof via registered or certified mail or
overnight delivery (with evidence of delivery) to such party at the address
in
effect for notices to him, her, or it under this Warrant Agreement and agrees
that such service shall constitute good and sufficient service of process and
notice thereof. Nothing contained herein shall be deemed to limit in any way
any
right to serve process in any manner permitted by law. Each party hereto hereby
irrevocably waives, to the fullest extent permitted by applicable law, any
and
all right to trial by jury in any legal proceeding arising out of or relating
to
this Warrant Agreement or any of the Transaction Documents or the transactions
contemplated hereby or thereby. If either party shall commence an action or
proceeding to enforce any provisions of this Warrant Agreement or any
Transaction Document, then the prevailing party in such action or proceeding
shall be reimbursed by the other party for his, her, or its reasonable attorneys
fees and other reasonable costs and expenses incurred with the investigation,
preparation, and prosecution of such action or proceeding.
(d)
The
headings herein are for convenience only, do not constitute a part of this
Warrant Agreement, and shall not be deemed to limit or affect any of the
provisions hereof.
(e)
In
case
any one or more of the provisions of this Warrant Agreement shall be invalid
or
unenforceable in any respect, the validity and enforceability of the remaining
terms and provisions of this Warrant Agreement shall not in any way be affected
or impaired thereby, and the parties will attempt in good faith to agree upon
a
valid and enforceable provision which shall be a commercially reasonable
substitute therefor, and upon so agreeing, shall incorporate such substitute
provision in this Warrant Agreement.
10
IN
WITNESS WHEREOF,
the
Company has caused this Warrant Agreement to be duly executed by its authorized
officer with an effective date of September 7, 2007.
|
CHASE
PACKAGING CORPORATION
|
||
| |
|
|
| By: | /s/ XXXXXXX X. XXXXXXX | |
|
Xxxxxxx X. Xxxxxxx, |
||
|
Vice
President
|
||
11
FORM
OF
EXERCISE NOTICE
(To
be
executed by the Holder to exercise the right to purchase shares of Common Stock
under the foregoing Warrant Certificate)
To:
Chase
Packaging Corporation
The
undersigned is the Holder of Warrant No. _______ (the “Warrant”)
issued
by Chase Packaging Corporation, a Texas corporation (the “Company”).
Capitalized terms used herein and not otherwise defined have the respective
meanings set forth in the Warrant.
|
1.
|
The
Warrant is currently exercisable to purchase a total of ______________
Warrant Shares.
|
|
2.
|
The
undersigned Holder hereby exercises his, her, or its right to purchase
_________________ Warrant Shares pursuant to the Warrant
Certificate.
|
|
3.
|
The
Holder intends that payment of the Exercise Price shall be made as
(check
one):
|
____ Cash
Exercise
____ “Cashless
Exercise” under Section 10 (if permitted)
|
4.
|
If
the holder has elected a Cash Exercise, the holder shall pay the
sum of
$____________ to the Company in accordance with the terms of the
Warrant
Certificate.
|
|
5.
|
Pursuant
to this exercise, the Company shall deliver to the holder _______________
Warrant Shares in accordance with the terms of the Warrant
Certificate.
|
|
6.
|
Following
this exercise, the Warrant Certificate shall be exercisable to purchase
a
total of ______________ Warrant
Shares.
|
|
Dated:_____________
,
_____
|
Name
of Holder:
|
|
|
(Print)
____________________________________
|
||
|
By:_______________________________________
|
||
|
Name:_____________________________________
|
||
|
Title:
_____________________________________
|
||
|
(Signature
must conform in all respects to name of holder
as
specified on the face of the Warrant
Certificate)
|
12
FORM
OF
ASSIGNMENT
[To
be
completed and signed only upon transfer of Warrant Certificate]
FOR
VALUE RECEIVED,
the
undersigned hereby sells, assigns, and transfers unto
________________________________ the right represented by the within Warrant
Certificate to purchase ____________ shares of Common Stock of Chase Packaging
Corporation to which the within Warrant Certificate relates and appoints
________________ attorney to transfer said right on the books of Chase Packaging
Corporation with full power of substitution in the premises.
|
Dated:_____________
,
_____
|
|
| __________________________________________________ | |
|
(Signature
must conform in all respects to name of holder as specified
on
the face of the Warrant Certificate)
|
|
| __________________________________________________ | |
|
Address
of Transferee
|
|
| __________________________________________________ | |
| __________________________________________________ | |
|
In
the presence of:
|
|
| ________________________ | |
13
