EXHIBIT 99.1
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SERIES A COMMON SHARE PURCHASE WARRANT
To Purchase __________ Common Shares of
VASOGEN INC.
Warrant No: ________________
THIS SERIES A COMMON SHARE PURCHASE WARRANT (the "WARRANT")
certifies that, for value received, _____________ (the "HOLDER"), is entitled,
upon the terms and subject to the limitations on exercise and the conditions
hereinafter set forth, at any time on or after the date hereof (the "INITIAL
EXERCISE DATE") and on or prior to the close of business on November , 2011
(the "TERMINATION DATE") but not thereafter, to subscribe for and purchase from
Vasogen Inc., a Canadian corporation (the "COMPANY"), up to ______ common
shares in the capital of the Company (the "COMMON Shares"). The purchase price
of one Common Share under this Warrant shall be equal to the Exercise Price, as
defined in Section 2(b). The Common Shares issuable upon exercise of this
Warrant are referred to as the "WARRANT SHARES".
SECTION 1. DEFINITIONS. Capitalized terms used and not otherwise
defined herein shall have the meanings set forth in that certain Securities
Purchase Agreement (the "PURCHASE AGREEMENT"), dated November 8, 2006, among
the Company and the purchasers signatory thereto.
SECTION 2. EXERCISE.
a) EXERCISE OF WARRANT. Exercise of the purchase rights
represented by this Warrant may be made, in whole or in part, at any time
or times on or after the Initial Exercise Date and on or before the
Termination Date by delivery to the Company of a duly executed facsimile
copy of the Notice of Exercise Form annexed hereto (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 such Holder appearing on the books of
the Company); PROVIDED, however, within 5 Trading Days of the date said
Notice of Exercise is delivered to the Company, if this Warrant is
exercised in full, the Holder shall have surrendered this Warrant to the
Company and the Company shall have received payment of the aggregate
Exercise Price of the Common Shares thereby purchased by wire transfer or
cashier's check drawn on a United States or Canadian bank.
Notwithstanding anything herein to the contrary, the Holder shall not be
required to physically surrender this Warrant to the Company until the
Holder has purchased all of the Warrant Shares available hereunder and
the Warrant has been exercised in full. Partial exercises of this Warrant
resulting in purchases of a portion of the total number of Warrant Shares
available hereunder shall have the effect of lowering the outstanding
number of Warrant Shares purchasable hereunder in an amount equal to the
applicable number of Warrant Shares purchased. The Holder and the Company
shall maintain records showing the number of Warrant Shares purchased and
the date of such purchases. The Company shall deliver any objection to
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any Notice of Exercise Form within 1 Business Day of receipt of such
notice. In the event of any dispute or discrepancy, the records of the
Holder shall be controlling and determinative in the absence of manifest
error. The Holder and any assignee, by acceptance of this Warrant,
acknowledge and agree that, by reason of the provisions of this
paragraph, following the purchase of a portion of the Warrant Shares
hereunder, the number of Warrant Shares available for purchase hereunder
at any given time may be less than the amount stated on the face hereof.
b) EXERCISE PRICE. The exercise price of the Common Shares
under this Warrant shall be U.S.$ 0.63 per share, subject to adjustment
hereunder (the "EXERCISE PRICE").
c) CASHLESS EXERCISE. If, but only if, at any time during
the term of this Warrant either there is no effective Registration
Statement registering the sale of the Warrant Shares to the Holder, or no
current prospectus available for, the resale of the Warrant Shares by the
Holder, then this Warrant may also be exercised at such time by means of
a "cashless exercise" in which the Holder shall be entitled to receive a
certificate for the number of Warrant Shares equal to the quotient
obtained by dividing [(A-B) (X)] by (A), where:
(A) = the VWAP on the Trading Day immediately preceding the
date of such election;
(B) = the Exercise Price of this Warrant, as adjusted; and
(X) = the number of Warrant Shares issuable upon exercise
of this Warrant in accordance with the terms of this
Warrant by means of a cash exercise rather than a
cashless exercise,
provided that the foregoing shall in no way adjust or change the Exercise
Price of this Warrant
"VWAP" means, for any security as of any date, the dollar
volume-weighted average price for such security on NASDAQ during the
period beginning at 9:30:01 a.m., New York Time (or such other time as
NASDAQ publicly announces is the official open of trading), and ending at
4:00:00 p.m., New York Time (or such other time as NASDAQ publicly
announces is the official close of trading) as reported by Bloomberg
through its "Volume at Price" functions, or, if the foregoing does not
apply, the dollar volume weighted average price of such security on
another Trading Market for such security during the period beginning at
9:30:01 a.m., New York Time (or such other time as such Trading Market
publicly announces is the official open of trading), and ending at
4:00:00 p.m., New York Time (or such other time as such Trading Market
publicly announces is the official close of trading) as reported by
Bloomberg, or, if the foregoing does not apply, the dollar
volume-weighted average price of such security in the over-the-counter
market on the electronic bulletin board for such security during the
period beginning at 9:30:01 a.m., New York Time (or such other time as
such Trading Market publicly announces is the official open of trading),
and ending at 4:00:00 p.m., New York Time (or such other time as such
market publicly announces is the official close of trading) as reported
by Bloomberg, if no dollar volume-weighted average price is reported for
such security by Bloomberg for such hours, the average of the highest
closing bid price and the lowest closing ask price of any of the market
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makers for such security as reported in the "pink sheets" by Pink Sheets
LLC (formerly the National Quotation Bureau, Inc.). If the VWAP cannot be
calculated for a security on a particular date on any of the foregoing
bases, the VWAP of such security on such date shall be the fair market
values determined by an appraiser selected in good faith by the Holder
and reasonably acceptable to the Company. All such determinations shall
be appropriately adjusted for any share dividend, share split, share
combination or other similar transaction during the applicable
calculation period.
d) HOLDER'S RESTRICTIONS. The Company shall not effect any
exercise of this Warrant, and a Holder shall not have the right to
exercise any portion of this Warrant, pursuant to Section 2(c) or
otherwise, to the extent that after giving effect to such issuance after
exercise, such Holder (together with such Holder's affiliates, and any
other person or entity acting as a group together with such Holder or any
of such Holder's affiliates), as set forth on the applicable Notice of
Exercise, would beneficially own in excess of the Beneficial Ownership
Limitation (as defined below). For purposes of the foregoing sentence,
the number of Common Shares beneficially owned by such Holder and its
affiliates shall include the number of Common Shares issuable upon
exercise of this Warrant with respect to which the determination of such
sentence is being made, but shall exclude the number of Common Shares
which would be issuable upon (A) exercise of the remaining, nonexercised
portion of this Warrant beneficially owned by such Holder or any of its
affiliates and (B) exercise or conversion of the unexercised or
nonconverted portion of any other securities of the Company (including,
without limitation, any other Warrants) subject to a limitation on
conversion or exercise analogous to the limitation contained herein
beneficially owned by such Holder or any of its affiliates. Except as set
forth in the preceding sentence, for purposes of this Section 2(d),
beneficial ownership shall be calculated in accordance with Section 13(d)
of the Exchange Act and the rules and regulations promulgated thereunder,
it being acknowledged by a Holder that the Company is not representing to
such Holder that such calculation is in compliance with Section 13(d) of
the Exchange Act and such Holder is solely responsible for any schedules
required to be filed in accordance therewith. To the extent that the
limitation contained in this Section 2(d) applies, the determination of
whether this Warrant is exercisable (in relation to other securities
owned by such Holder) and of which a portion of this Warrant is
exercisable shall be in the sole discretion of a Holder, and the
submission of a Notice of Exercise shall be deemed to be each Holder's
determination of whether this Warrant is exercisable (in relation to
other securities owned by such Holder) and of which portion of this
Warrant is exercisable, in each case subject to such aggregate percentage
limitation, and the Company shall have no obligation to verify or confirm
the accuracy of such determination. In addition, a determination as to
any group status as contemplated above shall be determined in accordance
with Section 13(d) of the Exchange Act and the rules and regulations
promulgated thereunder. For purposes of this Section 2(d), in determining
the number of outstanding Common Shares, a Holder may rely on the number
of outstanding Common Shares as reflected in (x) the Company's most
recent Form 6-K or Form 40-F or 20-F, as the case may be, (y) a more
recent public announcement by the Company or (z) any other notice by the
Company or the Company's Transfer Agent setting forth the number of
Common Shares outstanding. Upon the written or oral request of a Holder,
the Company shall within two Trading Days confirm orally and in writing
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to such Holder the number of Common Shares then outstanding. In any case,
the number of outstanding Common Shares shall be determined after giving
effect to the conversion or exercise of securities of the Company,
including this Warrant, by such Holder or its affiliates since the date
as of which such number of outstanding Common Shares was reported. The
"Beneficial Ownership Limitation" shall be 4.99% of the number of Common
Shares outstanding immediately after giving effect to the issuance of
Common Shares issuable upon exercise of this Warrant. The Beneficial
Ownership Limitation provisions of this Section 2(d) may be waived by
such Holder, at the election of such Holder, upon not less than 61 days'
prior notice to the Company to change the Beneficial Ownership Limitation
to 9.99% of the number of Common Shares outstanding immediately after
giving effect to the issuance of Common Shares upon exercise of this
Warrant, and the provisions of this Section 2(d) shall continue to apply.
Upon such a change by a Holder of the Beneficial Ownership Limitation
from such 4.99% limitation to such 9.99% limitation, the Beneficial
Ownership Limitation may not be waived by such Holder. The provisions of
this paragraph shall be implemented in a manner otherwise than in strict
conformity with the terms of this Section 2(d) to correct this paragraph
(or any portion hereof) which may be defective or inconsistent with the
intended Beneficial Ownership Limitation herein contained or to make
changes or supplements necessary or desirable to properly give effect to
such limitation. The limitations contained in this paragraph shall apply
to a successor holder of this Warrant.
e) MECHANICS OF EXERCISE.
i. AUTHORIZATION OF WARRANT SHARES. 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,
be duly authorized, validly issued, fully paid and nonassessable
and free from all taxes, liens and charges in respect of the
issue thereof (other than taxes in respect of any transfer
occurring contemporaneously with such issue).
ii. DELIVERY OF CERTIFICATES UPON EXERCISE.
Certificates for shares purchased hereunder shall be transmitted
by the transfer agent of the Company to the Holder by crediting
the account of the Holder's prime broker with the Depository
Trust Company through its Deposit Withdrawal Agent Commission
("DWAC") system if the Company is a participant in such system,
and otherwise by physical delivery to the address specified by
the Holder in the Notice of Exercise, in either case, within 3
Trading Days from the delivery to and receipt by the Company of
the Notice of Exercise Form, surrender of this Warrant (if
required) and payment of the aggregate Exercise Price as set
forth above ("WARRANT SHARE DELIVERY DATE"). This Warrant shall
be deemed to have been exercised on the date the Exercise Price
is received by the Company. The Warrant Shares shall be deemed to
have been issued, and the Holder or any other person so
designated to be named therein shall be deemed to have become a
holder of record of such shares for all purposes, as of the date
the Warrant has been exercised by payment to the Company of the
Exercise Price and all taxes required to be paid by the Holder,
if any, pursuant to Section 2(e)(vii) prior to the issuance of
such shares, have been paid.
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iii. DELIVERY OF NEW WARRANTS UPON EXERCISE. If this
Warrant shall have been exercised in part, the Company shall, at
the request of a Holder and upon surrender of this Warrant
certificate, at the time of delivery of the certificate or
certificates representing Warrant Shares, deliver to the Holder a
new Warrant evidencing the rights of the Holder to purchase the
unpurchased Warrant Shares called for by this Warrant, which new
Warrant shall in all other respects be identical with this
Warrant.
iv. RESCISSION RIGHTS. If the Company fails to cause
its transfer agent to transmit to the Holder a certificate or
certificates representing the Warrant Shares pursuant to this
Section 2(e)(iv) by the Warrant Share Delivery Date, then the
Holder will have the right to rescind such exercise.
v. COMPENSATION FOR BUY-IN ON FAILURE TO TIMELY
DELIVER CERTIFICATES UPON EXERCISE. In addition to any other
rights available to the Holder, if the Company fails to cause its
transfer agent to transmit to the Holder a certificate or
certificates representing the Warrant Shares pursuant to an
exercise on or before the Warrant Share Delivery Date, and if
after such date the Holder is required by its broker to purchase
(in an open market transaction or otherwise) Common Shares to
deliver in satisfaction of a sale by the Holder of the Warrant
Shares which the Holder anticipated receiving upon such exercise
(a "BUY-IN"), then the Company shall (1) pay in cash to the
Holder the amount by which (x) the Holder's total purchase price
(including brokerage commissions, if any) for the Common Shares
so purchased exceeds (y) the amount obtained by multiplying (A)
the number of Warrant Shares that the Company was required to
deliver to the Holder in connection with the exercise at issue
times (B) the price at which the sell order giving rise to such
purchase obligation was executed, and (2) at the option of the
Holder, either reinstate the portion of the Warrant and
equivalent number of Warrant Shares for which such exercise was
not honored or deliver to the Holder the number of Common Shares
that would have been issued had the Company timely complied with
its exercise and delivery obligations hereunder. For example, if
the Holder purchases Common Shares having a total purchase price
of $11,000 to cover a Buy-In with respect to an attempted
exercise of Common Shares with an aggregate sale price giving
rise to such purchase obligation of $10,000, under clause (1) of
the immediately preceding sentence the Company shall be required
to pay the Holder $1,000. The Holder shall provide the Company
written notice indicating the amounts payable to the Holder in
respect of the Buy-In, together with applicable confirmations and
other evidence reasonably requested by the Company. Nothing
herein shall limit a Xxxxxx's right to pursue any other remedies
available to 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 Common Shares upon exercise of the
Warrant as required pursuant to the terms hereof.
vi. NO FRACTIONAL SHARES OR SCRIP. No fractional
shares or scrip representing fractional shares shall be issued
upon the exercise of this Warrant. As to any fraction of a share
which Holder would otherwise be entitled to purchase upon such
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exercise, the Company shall pay a cash adjustment in respect of
such final fraction in an amount equal to such fraction
multiplied by the Exercise Price.
vii. CHARGES, TAXES AND EXPENSES. Issuance of
certificates for Warrant Shares shall be made without charge to
the Holder for any issue or transfer tax or other incidental
expense in respect of the issuance of such certificate, all of
which taxes and expenses shall be paid by the Company, and such
certificates shall 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 certificates for Warrant Shares are to
be issued in a name other than the name of the Holder, this
Warrant when surrendered for exercise shall 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.
viii. CLOSING OF BOOKS. The Company will not close its
shareholder books or records in any manner which prevents the
timely exercise of this Warrant, pursuant to the terms hereof.
SECTION 3. CERTAIN ADJUSTMENTS.
a) SHARE DIVIDENDS AND SPLITS. If the Company, at any time
while this Warrant is outstanding: (A) pays a share dividend or otherwise
makes a distribution or distributions on its Common Shares or any other
equity or equity equivalent securities payable in Common Shares (which,
for avoidance of doubt, shall not include any Common Shares issued by the
Company pursuant to this Warrant or the 6.45% senior convertible notes
issued by Vasogen Ireland Limited on October 7, 2005 and guaranteed by
the Company), (B) subdivides outstanding Common Shares into a larger
number of shares, (C) combines (including by way of reverse stock split)
outstanding Common Shares into a smaller number of Common Shares, or (D)
issues by reclassification of Common Shares any shares of the Company,
then in each case the Exercise Price shall be adjusted by multiplying the
Exercise Price then in effect by a fraction of which the numerator shall
be the number of Common Shares (excluding treasury shares, if any)
outstanding immediately before such event, and of which the denominator
shall be the number of Common Shares outstanding immediately after such
event and the number of shares issuable upon exercise of this Warrant
shall be proportionately adjusted. Any adjustment made pursuant to this
Section 3(a) shall become effective immediately after the record date for
the determination of shareholders entitled to receive such dividend or
distribution and shall become effective immediately after the effective
date in the case of a subdivision, combination or re-classification.
b) FUNDAMENTAL TRANSACTION. If, at any time while this
Warrant is outstanding, (A) the Company effects any merger or
consolidation of the Company with or into another Person, (B) the Company
effects any sale of all or substantially all of its assets in one or a
series of related transactions, (C) any tender offer or exchange offer
(whether by the Company or another Person) is completed pursuant to which
holders of Common Shares prior to such an offer do not retain at least a
majority of voting power of the Company or (D) the Company effects any
reclassification of the Common Shares or any compulsory share exchange
pursuant to which the Common Shares are effectively converted into or
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exchanged for other securities, cash or property (in any such case, a
"FUNDAMENTAL TRANSACTION"), then, upon any subsequent exercise of this
Warrant, the Holder shall have the right to receive, for each Warrant
Share that would have been issuable upon such exercise immediately prior
to the occurrence of such Fundamental Transaction, at the option of the
Holder, upon exercise of this Warrant, the number of Common Shares of the
successor or acquiring corporation or of the Company, if it is the
surviving corporation, and any additional consideration (the "ALTERNATE
CONSIDERATION") receivable upon or as a result of such reorganization,
reclassification, merger, consolidation or disposition of assets by a
Holder of the number of Common Shares for which this Warrant is
exercisable immediately prior to such event. For purposes of any such
exercise, the determination of the Exercise Price shall be appropriately
adjusted to apply to such Alternate Consideration based on the amount of
Alternate Consideration issuable in respect of one Common Share in such
Fundamental Transaction, and the Company shall apportion the 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 Shares 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 following
such Fundamental Transaction. To the extent necessary to effectuate the
foregoing provisions, 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 exercise such warrant into Alternate Consideration. 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 Section 3(c) and insuring that this
Warrant (or any such replacement security) will be similarly adjusted
upon any subsequent transaction analogous to a Fundamental Transaction.
c) CALCULATIONS. All calculations under this Section 3 shall
be made to the nearest cent or the nearest 1/100th of a share, as the
case may be. For purposes of this Section 3, the number of Common Share
deemed to be issued and outstanding as of a given date shall be the sum
of the number of Common Shares (excluding treasury shares, if any) issued
and outstanding.
d) VOLUNTARY ADJUSTMENT BY COMPANY. The Company may at any
time during the term of this Warrant, but subject to the prior approval
of the Toronto Stock Exchange or its successor so long as the Common
Shares are listed on such exchange, reduce the then current Exercise
Price to any amount and for any period of time deemed appropriate by the
Board of Directors of the Company.
e) NOTICE TO HOLDERS.
i. ADJUSTMENT TO EXERCISE PRICE. Whenever the
Exercise Price is adjusted pursuant to this Section 3, the
Company shall promptly mail to each Holder a notice setting forth
the Exercise Price after such adjustment and setting forth a
brief statement of the facts requiring such adjustment or in lieu
thereof shall forward such publicly filed documents that disclose
the same information.
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ii. NOTICE TO ALLOW EXERCISE BY HOLDER. If (A) the
Company shall declare a dividend (or any other distribution) on
the Common Shares; (B) the Company shall declare a special
nonrecurring cash dividend on or a redemption of the Common
Shares; (C) the Company shall authorize the granting to all
holders of the Common Shares rights or warrants to subscribe for
or purchase any shares of capital of any class or of any rights;
(D) the approval of any shareholders of the Company shall be
required in connection with any reclassification of the Common
Shares, any consolidation or merger to which the Company is a
party, any sale or transfer of all or substantially all of the
assets of the Company, of any compulsory share exchange whereby
the Common Shares are converted into other securities, cash or
property; (E) the Company shall authorize the voluntary or
involuntary dissolution, liquidation or winding up of the affairs
of the Company; then, in each case, the Company shall cause to be
mailed to the Holder at its last address as it shall appear upon
the Warrant Register (as defined below) of the Company, at least
20 calendar days prior to the applicable record or effective date
hereinafter specified, a notice or shareholder information
stating (x) the date on which a record is to be taken for the
purpose of such dividend, distribution, redemption, rights or
warrants, or if a record is not to be taken, the date as of which
the holders of the Common Shares of record to be entitled to such
dividend, distributions, redemption, rights or warrants are to be
determined or (y) the date on which such reclassification,
consolidation, merger, sale, transfer or share exchange is
expected to become effective or close, and the date as of which
it is expected that holders of the Common Shares of record shall
be entitled to exchange their Common Shares for securities, cash
or other property deliverable upon such reclassification,
consolidation, merger, sale, transfer or share exchange; provided
that the failure to mail such notice or shareholder information
or any defect therein or in the mailing thereof shall not affect
the validity of the corporate action required to be specified in
such notice. The Holder is entitled to exercise this Warrant
during the 20-day period commencing on the date of such notice to
the effective date of the event triggering such notice, provided
that it does not extend the Termination Date.
SECTION 4. TRANSFER OF WARRANT.
a) TRANSFERABILITY. This Warrant and all rights hereunder
are transferable, in whole or in part, upon surrender of this Warrant at
the principal office of the Company, 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 or Warrants in the name of the assignee or
assignees and in the denomination or denominations specified in such
instrument of assignment, and shall issue to the assignor a new Warrant
evidencing the portion of this Warrant not so assigned, and this Warrant
shall promptly be cancelled. A Warrant, if properly assigned, may be
exercised by a new holder for the purchase of Warrant Shares without
having a new Warrant issued.
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b) 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 4(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.
c) 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 5. MISCELLANEOUS.
a) TITLE TO WARRANT. Prior to the Termination Date and
subject to compliance with applicable laws and Section 4 of this Warrant,
this Warrant and all rights hereunder are transferable, in whole or in
part, at the office or agency of the Company by the Holder in person or
by duly authorized attorney, upon surrender of this Warrant together with
the Assignment Form annexed hereto properly endorsed.
b) NO RIGHTS AS SHAREHOLDER UNTIL EXERCISE. This Warrant
does not entitle the Holder to any voting rights or other rights as a
shareholder of the Company prior to the exercise hereof. Upon the
surrender of this Warrant and the payment of the aggregate Exercise Price
(or by means of a cashless exercise), the Warrant Shares so purchased
shall be and be deemed to be issued to such Holder as the record owner of
such shares as of the close of business on the later of the date of such
surrender or payment.
c) 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 share certificate relating to the Warrant Shares, and in
case of loss, theft or destruction, of indemnity or security reasonably
satisfactory to it (which, in the case of the Warrant, shall not include
the posting of any bond), and upon surrender and cancellation of such
Warrant or share certificate, if mutilated, the Company will make and
deliver a new Warrant or share certificate of like tenor and dated as of
such cancellation, in lieu of such Warrant or share certificate.
d) 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 shall be a Saturday, Sunday or a legal holiday
in Canada or the United States, then such action may be taken or such
right may be exercised on the next succeeding day not a Saturday, Sunday
or legal holiday.
e) AUTHORIZED SHARES.
The Company covenants that during the period the Warrant
is outstanding, it will reserve from its authorized and unissued
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Common Shares a sufficient number of shares to provide for the
issuance of the Warrant Shares upon the exercise of any purchase
rights under this Warrant. The Company further covenants that its
issuance of this Warrant shall constitute full authority to its
officers who are charged with the duty of executing share
certificates to execute and issue the necessary certificates for
the 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 Shares may be listed.
Except and to the extent as waived or consented to by the
Holder, the Company shall not by any action, including, without
limitation, any reorganization, transfer of assets,
consolidation, merger, dissolution or any other voluntary action,
with the intention of avoiding or seeking 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. Without limiting the generality
of the foregoing, the Company will (a) take all such action as
may be necessary or appropriate in order that the Company may
validly and legally issue fully paid and non-assessable Warrant
Shares upon the exercise of this Warrant, and (b) use
commercially reasonable efforts to obtain all such
authorizations, exemptions or consents from any public regulatory
body having jurisdiction thereof as may be necessary to enable
the Company to perform its obligations under this Warrant.
Before taking any action which would result in an
adjustment in the number of Warrant Shares for which this Warrant
is exercisable or in the Exercise Price, the Company shall obtain
all such authorizations or exemptions thereof, or consents
thereto, as may be necessary from any public regulatory body or
bodies having jurisdiction thereof.
f) JURISDICTION. All questions concerning the construction,
validity, enforcement and interpretation of this Warrant shall be
determined in accordance with the provisions of the Purchase Agreement.
g) NONWAIVER AND EXPENSES. No course of dealing or any delay
or failure to exercise any right hereunder on the part of the Holder
shall operate as a waiver of such right or otherwise prejudice the
Holder's rights, powers or remedies, notwithstanding the fact that all
rights hereunder terminate on the Termination Date. 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.
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h) NOTICES. Any notice, request or other document required
or permitted to be given or delivered to the Holder by the Company shall
be delivered in accordance with the notice provisions of the Purchase
Agreement.
i) LIMITATION OF LIABILITY. No provision hereof, in the
absence of any affirmative action by the Holder to exercise this Warrant
or purchase Warrant Shares, and no enumeration herein of the rights or
privileges of the Holder, shall give rise to any liability of the Holder
for the purchase price of any Common Shares or as a shareholder of the
Company, whether such liability is asserted by the Company or by
creditors of the Company.
j) 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 the defense in any action for
specific performance that a remedy at law would be adequate.
k) SUCCESSORS AND ASSIGNS. Subject to applicable securities
laws, this Warrant and the rights and obligations evidenced hereby shall
inure to the benefit of and be binding upon the successors of the Company
and the successors and permitted assigns of the Holder. The provisions of
this Warrant are intended to be for the benefit of all Holders from time
to time of this Warrant and shall be enforceable by any such Holder or
holder of Warrant Shares.
l) AMENDMENT. This Warrant may be modified or amended or the
provisions hereof waived with the written consent of the Company and the
Holder.
m) SEVERABILITY. Wherever possible, each provision of this
Warrant shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Warrant shall be
prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provisions or the remaining provisions
of this Warrant.
n) 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.
********************
11
IN WITNESS WHEREOF, the Company has caused this Warrant to be
executed by its officer thereunto duly authorized.
Dated: November ___, 2006
VASOGEN INC.
By:
---------------------------
Name:
Title:
12
NOTICE OF EXERCISE
TO: VASOGEN INC.
(1) The undersigned hereby elects to purchase ________ Warrant
Shares of the Company pursuant to the terms of the attached Warrant (only if
exercised in full), and tenders herewith payment of the exercise price in full,
together with all applicable transfer taxes, if any.
(2) Payment shall take the form of (check applicable box):
[_] in lawful money of the United States; or
[_] the cancellation of such number of Warrant Shares as is
necessary, in accordance with the formula set forth in
subsection 2(c), to exercise this Warrant with respect
to the maximum number of Warrant Shares purchasable
pursuant to the cashless exercise procedure set forth
in subsection 2(c).
(3) Please issue a certificate or certificates representing said
Warrant Shares in the name of the undersigned or in such other name as is
specified below:
_____________________________________
The Warrant Shares shall be delivered to the following:
_____________________________________
_____________________________________
_____________________________________
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, 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.
