Contract
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. NO REGISTRATION OF TRANSFER OF THIS WARRANT OR THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF WILL BE MADE ON THE BOOKS OF THE ISSUER UNLESS SUCH TRANSFER IS MADE IN CONNECTION WITH AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT OR PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT OR SUCH ACT DOES NOT APPLY.
COMMON STOCK PURCHASE WARRANT
| Warrant Shares: 5,550,625 | Issue Date: November 12, 2015 |
THIS COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies that, for value received, Knight Therapeutics (Barbados) Inc. (the “Holder”) is entitled, upon the terms and subject to the limitations on exercise and the conditions set forth in this Warrant, at any time on or after November 12, 2015 (the “Exercise Date”) and on or prior to the close of business on December 31, 2015 (the “Termination Date”) but not thereafter, to subscribe for and purchase from Synergy CHC Corp, a Nevada corporation (the “Company”), 5,550,625 fully paid and nonassessable shares (the “Warrant Shares”) of the Company’s Common Stock (the “Common Stock”), represent six and one-half percent (6.5%) of the Company’s issued and outstanding Common Stock on a Fully Diluted Basis. The purchase price for the Common Stock under this Warrant is equal to the Exercise Price.
Section 1. Exercise.
(a) Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time on or after the Exercise Date and on or before the Termination Date by delivery to the Company (or such other office or agency of the Company as it may designate by notice in writing to the registered Holder at the address of the Holder appearing on the books of the Company) of a duly executed facsimile copy of the Notice of Exercise Form annexed hereto. Prior to the sending of a Notice of Exercise Form, the Holder may request, and the Company shall be obligated to deliver, a certificate signed by a senior officer of the Company setting forth the number of issued and outstanding shares of Common Stock on a Fully Diluted Basis at such time, and any such other evidence as may be reasonably requested by the Holder in order to establish the number of Warrant Shares that the Holder is entitled to purchase hereunder at such time. On the date of exercise, the Holder shall deliver the Exercise Price for the Common Stock and shall surrender this Warrant to the Company for cancellation within three (3) Trading Days of the date on which the Notice of Exercise is delivered to the Company. The Company shall deliver any objection to any Notice of Exercise Form within one (1) Business Day of receipt of such notice.
(b) Exercise Price. The exercise price for the purchase of all of the shares of Common Stock under this Warrant is US$1.00 in the aggregate and not on a per share basis, (the “Exercise Price”).
(c) Mechanics of Exercise.
i. Delivery of Warrant Shares Upon Exercise. The Company shall use best efforts to cause the Warrant Shares purchased hereunder to be issued in book-entry format on the records of the transfer agent and registrar of the Company, or, if the Warrant Shares cannot be issued in book-entry format, then by physical delivery of a stock certificate to the address specified by the Holder in the Notice of Exercise, by the date that is three (3) Trading Days after the latest of (A) the delivery to the Company of the Notice of Exercise, (B) surrender of this Warrant (if required) and (C) payment of the Exercise Price as set forth above (such date, the “Warrant Share Delivery Date”). The Warrant Shares will be deemed to have been issued, and the Holder or any other person so designated to be named therein will be deemed to have become a holder of record of such shares for all purposes, as of the date on which the Warrant has been exercised, with payment to the Company of the Exercise Price and all taxes required to be paid by the Holder, if any, pursuant to Section 1(d)(iv) prior to the issuance of such shares having been paid.
ii. No Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares may be issued upon the exercise of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall round up to the next whole share.
iii. Charges, Taxes and Expenses. Issuance of Warrant Shares will be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses will be paid by the Company, and such Warrant Shares will be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided, however, that in the event Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for exercise must be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise.
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Section 2. Fundamental Transaction
(a) Fundamental Transaction. The Company may not enter into or be a party to a Fundamental Transaction without providing the Holder with the opportunity to exercise this Warrant in advance of consummating such Fundamental Transaction.
Section 3. Transfer of Warrant.
(a) Transferability. This Warrant and all rights hereunder are transferable upon surrender of this Warrant at the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant in the name of the assignee specified in such instrument of assignment, and this Warrant shall promptly be cancelled. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.
(b) Transfer to Comply with the Securities Act. This Warrant may not be exercised, and neither this Warrant nor any of the Warrant Shares may be disposed of except in compliance with applicable United States federal and state securities or “blue sky” laws and the terms and conditions hereof. Any new Warrant issued upon transfer of this Warrant will bear a legend in substantially the same form as the legend set forth on the first page of this Warrant, unless the Holder delivers to the Company an opinion of counsel reasonably satisfactory to the Company that such new Warrant need no longer be subject to the restriction contained herein. Each certificate for Warrant Shares issued upon exercise of this Warrant (or subsequently issued in substitution or exchange for such Warrant Shares), unless either (i) at the time of exercise such Warrant Shares are registered under the Securities Act of 1933, as amended (the “Securities Act”), or (ii) the Warrant Shares are no longer subject to the restriction contained herein, will bear a legend substantially in the following form:
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. NO REGISTRATION OF TRANSFER OF SUCH SECURITIES WILL BE MADE ON THE BOOKS OF THE ISSUER UNLESS SUCH TRANSFER IS MADE IN CONNECTION WITH AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT OR PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT OR SUCH ACT DOES NOT APPLY.
(c) The provisions of this Section 3 are binding upon all subsequent holders of certificates for Warrant Shares bearing the above legend and all subsequent holders of this Warrant, if any.
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(d) New Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney. Subject to compliance with Section 3(a), as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges will be dated the initial issuance date of this Warrant and will be identical to this Warrant except as to the number of Warrant Shares issuable pursuant thereto.
(e) Warrant Register. The Company shall register this Warrant, 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 this Warrant 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.
Section 4. Definitions. For purposes of this Warrant, the following capitalized terms have the meanings specified in this Section 4:
(a) “Business Day” means a day other than Saturday, Sunday, or any other day on which commercial banks in New York, New York are authorized or required to by law to close.
(b) A “Fully-Diluted Basis” means the number of shares of Common Stock outstanding at a given time plus that number of shares of Common Stock that are issuable upon the conversion, exercise or exchange of all securities of the Company that are convertible or exchangeable or excercisable into shares of Common Stock based on the applicable conversion, exchange or exercise rate, including any warrants and any options to purchase shares of Common Stock granted by the Company.
(c) A “Fundamental Transaction” occurs if (i) the Company, directly or indirectly, in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company, directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets in one or a series of related transactions, (iii) any direct or indirect purchase offer, tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization 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, or (v) the Company, directly or indirectly, in one or more related transactions consummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person or group of Persons whereby such other Person or group (other than Xxxx X. Xxxxxxx and his affiliates) acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held by the other Person or other Persons making or party to, or associated or affiliated with the other Persons making or party to, such stock or share purchase agreement or other business combination).
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(d) “Person” means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization, any other entity or a government or any department or agency thereof.
(e) “Successor Entity” means the Person formed by, resulting from or surviving any Fundamental Transaction or the Person with which such Fundamental Transaction has been entered into.
(f) “Trading Day” means a day on which the principal Trading Market is open for trading.
(g) “Trading Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE MKT, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock Exchange or the OTC Bulletin Board (or any successors to any of the foregoing).
Section 5. Miscellaneous.
(a) No Rights as Stockholder Until Exercise. This Warrant does not entitle the Holder to any voting rights, dividends or other rights as a stockholder of the Company prior to the exercise hereof as set forth in Section 1, except as expressly set forth in Section 2.
(b) Loss, Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it, and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor, in lieu of such Warrant or stock certificate.
(c) Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein is not a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day.
(d) Authorized Shares.
The Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant. If at any time the number of authorized but unissued shares of Common Stock is not sufficient to effect in full the exercise of this Warrant, in addition to such other remedies as are available to the Holder, the Company will promptly take such corporate action as may, in the opinion of its counsel, be necessary to increase the number of authorized but unissued shares of Common Stock to such number of shares as are sufficient for such purposes, including, without limitation, using its best efforts to obtain the requisite shareholder approval necessary to increase the number of authorized shares of Common Stock. The Company further covenants that its issuance of this Warrant constitutes full authority to its officers who are charged with the duty of executing stock certificates to execute and issue the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock may be listed. The Company covenants that all Warrant Shares which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment for such Warrant Shares in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens and charges created by the Company in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with such issue).
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Except and to the extent as waived or consented to by the Holder, the Company may not by any action, including, without limitation, amending its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment.
(e) Jurisdiction. The validity, interpretation, construction and performance of this Warrant, and all acts and transactions pursuant hereto and the rights and obligations of the parties hereto, shall be governed, construed and interpreted in accordance with the laws of the state of New York.
(f) Nonwaiver and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies. Without limiting any other provision of this Warrant, if the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.
(g) Notices. Any notice, consent or report required or permitted to be given or made under this Warrant by one Party to the other Party will be in writing, delivered personally or by U.S. first class mail or express courier providing evidence of receipt, postage prepaid (where applicable), or by electronic mail, to the address set forth on the signature page hereto. All such notices will be effective upon receipt.
(h) Limitation of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, will give rise to any liability of the Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.
(i) Remedies. The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert the defense in any action for specific performance that a remedy at law would be adequate.
(j) Successors and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby will inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and are enforceable by the Holder or any holder of Warrant Shares.
(k) Amendment. This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.
(l) Severability. Wherever possible, each provision of this Warrant must be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant is prohibited by or invalid under applicable law, such provision will be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant.
(m) Headings. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.
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(Signature Page Follows)
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IN WITNESS WHEREOF, each of the Company and the Holder has caused this Warrant to be executed as of the date first above indicated.
| Synergy CHC corp. | ||
| By: | /s/ Xxxx Xxxx | |
| Name: | Xxxx Xxxx | |
| Title: | President and Chief Executive Officer | |
| Address: | ||
| Attn: | President | |
| KNIGHT THERAPEUTICS (BARBADOS) INC. | ||
| By: | /s/ Xxxxxx Xxxxxxxx | |
| Name: | Xxxxxx Xxxxxxxx | |
| Title: | President | |
| Address: | Xxx Xxxxxxxx Xxxxxx, Xxxxx, Xx. Xxxxxxx XX00000, Barbados, WI | |
| With a copy to: | |
| Davies Xxxx Xxxxxxxx & Xxxxxxxx LLP | |
| 000 Xxxxx Xxxxxx, 00xx Xxxxx | |
| Xxx Xxxx, XX 00000 | |
| Attention: Xxxxxx X. Xxxxx |
NOTICE OF EXERCISE
(1) The undersigned hereby elects to purchase all of the Warrant Shares of the Company pursuant to the terms of the attached Warrant, and tenders herewith payment of US$1.00, representing the aggregate exercise price in full, together with all applicable transfer taxes, if any.
(2) Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:
_______________________________
The Warrant Shares shall be delivered as follows:
_______________________________
_______________________________
_______________________________
| SIGNATURE OF HOLDER |
If an Individual (Print Name): _________________________________________________
If an Entity (Print Name of Investing Entity): ______________________________________
Signature of Authorized Signatory of Investing Entity: ________________________________________________________________________
Name of Authorized Signatory: ________________________________________________
Title of Authorized Signatory: _________________________________________________
Date: ____________________________________________________________________
ASSIGNMENT FORM
(To
assign the foregoing warrant, execute
this form and supply required information.
Do not use this form to exercise the warrant.)
FOR VALUE RECEIVED, _______ shares of the foregoing Warrant and all rights evidenced thereby are hereby assigned to
_______________________________________________ whose address is
_______________________________________________________________.
_______________________________________________________________
| Dated: ______________, _______ | |||
| Holder’s Signature: | __________________________________ | ||
| Holder’s Address: | __________________________________ | ||
| __________________________________ | |||
| Signature Guaranteed: ___________________________________________ |
NOTE: The signature to this Assignment Form must correspond with the name as it appears on the face of the Warrant, without alteration or enlargement or any change whatsoever, and must be guaranteed by a bank or trust company. Officers of corporations and those acting in a fiduciary or other representative capacity should file proper evidence of authority to assign the foregoing Warrant.
