Exhibit 10.28
THIS WARRANT AND THE SHARES OF COMPANY STOCK ISSUABLE UPON THE EXERCISE HEREOF
HAVE NOT BEEN REGISTERED UNDER EITHER THE SECURITIES ACT OF 1933 (THE "ACT") OR
APPLICABLE STATE SECURITIES LAWS (THE "STATE ACTS") AND SHALL NOT BE SOLD,
PLEDGED, HYPOTHECATED, DONATED OR OTHERWISE TRANSFERRED (WHETHER OR NOT FOR
CONSIDERATION) BY THE HOLDER EXCEPT UPON THE ISSUANCE TO THE COMPANY OF A
FAVORABLE OPINION OF COUNSEL AND/OR SUBMISSION TO THE COMPANY OF SUCH EVIDENCE
AS MAY BE SATISFACTORY TO COUNSEL TO THE COMPANY, IN EACH SUCH CASE, TO THE
EFFECT THAT ANY SUCH TRANSFER SHALL NOT BE IN VIOLATION OF THE ACT AND THE STATE
ACTS.
WARRANT TO PURCHASE TWENTY FIVE THOUSAND
SHARES OF COMMON STOCK
Of
ULTRALIFE BATTERIES, INC.
(a Delaware Corporation)
Void after 5:00 O'Clock P.M.,
Eastern Standard Time, on June 4, 2006
Ultralife Batteries, Inc., a Delaware corporation (the "Company") hereby
certifies that Hitschler, Kimelman Holdings, LLC, its registered successors and
permitted assigns registered on the books of the Company maintained for such
purposes as the registered holder hereof (the "Holder"), for value received, is
entitled to purchase from the Company twenty-five thousand (25,000) fully paid
and non-assessable shares of Common Stock of the Company, par value of ten cents
($.10) per share (the "Shares") stated above at the purchase price (the
"Exercise Price") of four dollars ($4.00) per share (the number of Shares and
Exercise Price being subject to adjustment as hereinafter provided) upon the
terms and conditions herein provided.
1. EXERCISE OF WARRANTS.
1.1. Subject to Section 1.2., upon presentation and surrender of this
Warrant Certificate, with the attached Purchase Form duly executed, at the
principal office of the Company at Newark, New York, or at such other place as
the Company may designate by notice to the Holder hereof, together with a check
payable to the order of the Company in the amount of the Exercise Price times
the number of Shares being purchased, the Company shall deliver to the Holder
hereof, as promptly as practicable, certificates representing the Shares being
purchased. This Warrant may be exercised in whole or in part; and, in case of
exercise hereof in part only, the Company, upon surrender hereof, will deliver
to the Holder a new Warrant Certificate or Warrant Certificates of like
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tenor entitling the Holder to purchase the number of Shares as to which this
Warrant has not been exercised.
1.2. This Warrant may be exercised in whole or in part at any time on
and after June 4, 2003; provided, however, that if Holder has exercised the
rights to convert the principal amount of the Promissory Note issued to it on
even date herewith into shares of the Company's common stock pursuant to the
conversion provisions of the Promissory Note, this warrant shall immediately and
with no further action on the part of the Holder or the Company become void and
of no further force or effect in the same proportion that the principal amount
of the Promissory Note that is converted to the Company's common stock.
2. RIGHTS AND OBLIGATIONS OF WARRANT HOLDER.
2.1. The Holder of this Warrant Certificate shall not, by virtue
hereof, be entitled to any rights of a stockholder in the Company, either at law
or in equity; provided, however, in the event that any certificate representing
the Shares as issued to the Holder hereof upon exercise of this Warrant, such
Holder shall, for all purposes, be deemed to have become the holder of record of
such Shares on the date on which this Warrant Certificate, together with a duly
executed Purchase Form, was surrendered and payment of the Exercise Price was
made, irrespective of the date of delivery of such Share certificate. The rights
of the Holder of this Warrant are limited to those expressed herein and the
Holder of this Warrant, by its acceptance hereof, consents to and agrees to be
bound by and to comply with all the provisions of this Warrant Certificate,
including, without limitation, all the obligations imposed upon the Holder
hereof by Sections 2 and 4 hereof. In addition, the Holder of this Warrant
Certificate, by accepting the same, agrees that the Company may deem and treat
the person in whose name this Warrant Certificate is registered on the books of
the Company maintained for such purpose as the absolute, true and lawful owner
for all purposes whatsoever, notwithstanding any notation of ownership or other
writing thereon, and the Company shall not be affected by any notice to the
contrary.
2.2. No Holder of this Warrant Certificate, as such, shall be entitled
to vote or receive dividends or to be deemed the holder of Shares for any
purpose, nor shall anything contained in this Warrant Certificate be construed
to confer upon any Holder of this Warrant Certificate, as such, any of the
rights of a shareholder of the Company or any right to vote, give or withhold
consent to any action by the Company, receive dividends, subscription rights, or
otherwise, until this Warrant shall have been exercised and the Shares
purchasable upon the exercise thereof shall have become deliverable as provided
herein; provided, however, that any such exercise on any date when the stock
transfer books of the Company shall be closed shall constitute the person or
persons in whose name or names the certificate or certificates for those Shares
are to be issued as the record holder or holders thereof for all purposes at the
opening of business on the next succeeding day on which such stock transfer
books are open, and the Warrant surrendered shall not be deemed to have been
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exercised, in whole or in part as the case may be, until the next succeeding day
on which stock transfer books are open for the purpose of determining
entitlement to dividends on the Company's common stock.
3. SHARES UNDERLYING WARRANTS. The Company covenants and agrees that all
Shares delivered upon the exercise of this Warrant shall, upon delivery and
payment therefor, be duly and validly authorized and issued, fully-paid and
non-assessable, and free from all stamp-taxes, liens and charges with respect to
the purchase thereof. In addition, the Company agrees at all times to reserve
and keep available an authorized number of Shares sufficient to permit the
exercise in full of this Warrant.
4. DISPOSITION OF WARRANTS OR SHARES. The holder of this Warrant
Certificate and any transferee hereof or of the Shares issuable upon the
exercise of the Warrant Certificate, by their acceptance hereof, hereby (i)
represent and warrant that this Warrant Certificate and the shares issuable upon
exercise thereof are being acquired for investment for the account of the holder
and with no intent to sell, transfer or subdivide such Warrant Certificate or
Shares, and (ii) except as herein specifically provided and permitted understand
and agree that the Warrant, and the Shares issuable upon the exercise hereof,
have not been registered under either the Securities Act of 1933 (the "Act") or
applicable State Securities Laws (the "State Acts") and shall not be sold,
pledged, hypothecated, donated or otherwise transferred (whether or not for
consideration) except upon the issuance to the Company of a favorable opinion of
counsel and/or submission to the Company of such evidence as may be satisfactory
to counsel to the Company, in each such case, to the effect that any such
transfer shall not be in violation of the Act and the State Acts. It shall be a
condition to the transfer of this Warrant that any transferee thereof deliver to
the Company its written agreement to accept and be bound by all of the terms and
conditions of this Warrant Certificate.
5. ADJUSTMENTS. The aggregate number and shares of common stock of the
Company subject to this Warrant and the Exercise Price shall be proportionately
adjusted for any increase, decrease, or change in the total outstanding shares
of the Company's common stock resulting from a stock dividend, recapitalization,
merger, consolidation, split-up, combination, exchange of shares, issuance of
additional shares, or similar transaction. An adjustment made pursuant to this
Section 5.1. shall be made whenever any of such events shall occur, but shall
become effective retroactively after such record date or such effective date, as
the case may be, as to Warrants exercised between such record date or effective
date and the date of happening of any such event. Whenever the number of Shares
purchasable hereunder is adjusted as herein provided, the Company shall cause to
be mailed to the Holder in accordance with the provisions of this Section 5 a
notice (i) stating that the number of Shares purchasable upon exercise of this
Warrant have been adjusted, (ii) setting forth the adjusted number of Shares
purchasable upon the exercise of this Warrant and (iii) showing in reasonable
detail the computations and the facts, including the amount of consideration
received or deemed to have been received by the Company, upon which such
adjustments are based.
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6. PIGGY-BACK REGISTRATION RIGHTS. The Company shall bear all costs and
expenses of registration of the Shares with the Securities and Exchange
Commission or any State Securities Commission in the event that the Company at
any time proposes to register any of its securities for its own account or for
the account of any other person (other than pursuant to a registration on Form
S-4 or Form S-8). The Holder agrees to provide the Company with such
information, understandings, and indemnifications a the Company may reasonably
request in connection with any such registration. The Holder agrees that, if it
is able to sell publicly the Shares pursuant to Rule 144, it will not be able to
avail itself of the registration rights hereunder.
7. LOSS OR DESTRUCTION. Upon receipt of evidence satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant
Certificate and, in the case of any such loss, theft or destruction, upon
delivery of an indemnity agreement or bond satisfactory in form, substance and
amount to the Company or, in the case of any such mutilation, upon surrender and
cancellation of this Warrant Certificate, the Company at its expense will
execute and deliver, in lieu thereof, a new Warrant Certificate of like tenor.
8. SURVIVAL. The various rights and obligations of the Holder hereof as
set forth herein shall survive the exercise of the Warrants represented hereby
and the surrender of this Warrant Certificate.
9. NOTICES. Whenever any notice, payment of any purchase price, or other
communication is required to be given or delivered under the terms of this
Warrant, it shall be in writing and delivered by hand delivery or United States
registered or certified mail, return receipt requested, postage prepaid, and
will be deemed to have been given or delivered on the date such notice, purchase
price or other communication is so delivered or posted, as the case may be; and,
if to the Company, it will be addressed to the address specified in Section 1
hereof, and if to the Holder, it will be addressed to the registered Holder at
its address as it appears on the books of the Company.
Ultralife Batteries, Inc.
/s/ John Kavazanjian By /s/ Robert W. Fishback (SEAL)
- -------------------- -----------------------------------
Robert W. Fishback,
Vice President of Finance and
Chief Financial Officer
March 4, 2003
Agreed and Acknowledged
Hitschler, Kimelman Holdings, LLC
By /s/ W. Anthony Hitschler
-----------------------------------
W. Anthony Hitschler, Member
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