THIS WARRANT AND ANY SHARES OF COMMON STOCK ISSUED UPON EXERCISE
HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A
VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF.
NO SUCH SALE OR DISPOSITION MAY BE AFFECTED WITHOUT AN EFFECTIVE
REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL
THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED.
INYX, INC.
WARRANT TO PURCHASE SHARES
(SUBJECT TO ADJUSTMENT)
OF COMMON STOCK
(Void after August _, 2009)
No: TR2W-1
This certifies that for value, ______________________________,
or registered assigns (the "Holder"), is entitled, subject to the terms
set forth below, at any time from and after August _, 2004 (the
"Original Issuance Date") and before 5:00 p.m., Eastern Time, on
August 2, 2009 (the "Expiration Date"), to purchase from INYX, Inc., a
Nevada corporation (the "Company"), __________________________ (______)
shares (subject to adjustment as described herein), of common
stock, par value $0.001 per share, of the Company (the "Common
Stock"), upon surrender hereof, at the principal office of the
Company referred to below, with a duly executed subscription form
in the form attached hereto as Exhibit A and simultaneous payment
therefor in lawful, immediately available money of the United
States or otherwise as hereinafter provided, at an initial
exercise price per share of $_________ (the "Purchase Price");
provided, however, that notwithstanding anything to the contrary
provided herein or elsewhere: (i) the Purchase Price shall be
increased by two (2%) percent (but no more than cumulatively
twenty (20%) percent) for every $2,000,000 of net revenues of the
Company above $35,000,000 for the twelve (12) months ended
December 31, 2005 and $55,000,000 for the twelve (12) months
ended December 31, 2006; and (ii) the Purchase Price shall be
decreased by five (5%) percent (but no more than cumulatively
fifty (50%) percent) for every $2,000,000 million that net
revenues of the Company are below $35,000,000 for the twelve (12)
months ended December 31, 2005 and $55,000,000 for the twelve
(12) months ended December 31, 2006. "Net revenues" shall be as
set forth in the Company's audited financial statements included
in the Company's Annual Report on Form 10-KSB (or such other
similar report) for the applicable fiscal year. The Purchase
Price is subject to further adjustment as provided below, and the
term "Common Stock" shall include, unless the context otherwise
requires, the stock and other securities and property at the time
receivable upon the exercise of this Warrant. The term
"Warrants," as used herein, shall mean this Warrant and any other
Warrants delivered in substitution or exchange therefor as
provided herein.
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This Warrant was issued in connection with a $4,000,000
minimum amount and a $7,000,000 maximum amount private placement
(the "Offering") of Common Stock and Warrants.
acted as placement agent for the Offering (the "Placement
Agent"). In the Offering, the Company sold its securities to
"accredited investors" pursuant to Subscription Agreements (the
"Subscription Agreements").
1. Exercise. This Warrant may be exercised at any time or from
time to time from and after the Original Issuance Date and before
5:00 p.m., Eastern Time, on August 2, 2009, on any business day,
for the full number of shares of Common Stock called for hereby,
by surrendering it at the principal office of the Company, at 825
Third Avenue, New York, New York 10022, with the subscription
form duly executed, together with payment in an amount equal to
(a) the number of shares of Common Stock called for on the face
of this Warrant, as adjusted in accordance with the preceding
paragraph of this Warrant (without giving effect to any further
adjustment herein), multiplied (b) by the Purchase Price. Payment
of the Purchase Price may be made at Holder's choosing either:
(1) by payment in immediately available funds; or (2) in lieu of
any cash payment, if this Warrant is exercised on a date
following the date one (1) year from the Original Issuance Date,
and the Registration Statement (as defined in the Registration
Rights Agreement), covering the shares of Common Stock issuable
upon exercise of this Warrant has not been declared effective by
the Securities and Exchange Commission (the "Commission"), or is
no longer in effect, in exchange for the number of shares of
Common Stock equal to the product of (x) the number of shares to
which the Warrants are being exercised multiplied by (y) a
fraction, the numerator of which is the Purchase Price and the
denominator of which is the Fair Market Value (as defined below).
This Warrant may be exercised for less than the full number of
shares of Common Stock at the time called for hereby, except that
the number of shares receivable upon the exercise of this Warrant
as a whole, and the sum payable upon the exercise of this Warrant
as a whole, shall be proportionately reduced. Upon a partial
exercise of this Warrant in accordance with the terms hereof,
this Warrant shall be surrendered, and a new Warrant of the same
tenor and for the purchase of the number of such shares not
purchased upon such exercise shall be issued by the Company to
Holder without any charge therefor. A Warrant shall be deemed to
have been exercised immediately prior to the close of business on
the date of its surrender for exercise as provided above, and the
person entitled to receive the shares of Common Stock issuable
upon such exercise shall be treated for all purposes as the
holder of such shares of record as of the close of business on
such date. Within two (2) business days after such date, the
Company shall issue and deliver to the person or persons entitled
to receive the same a certificate or certificates for the number
of full shares of Common Stock issuable upon such exercise,
together with cash, in lieu of any fraction of a share, equal to
such fraction of the then Fair Market Value on the date of
exercise of one full share of Common Stock.
"Fair Market Value" shall mean, as of any date: (i) if
shares of the Common Stock are listed on a national securities
exchange, the average of the closing prices as reported for
composite transactions during the five (5) consecutive trading
days preceding the trading day immediately prior to such date or,
if no sale occurred on a trading day, then the mean between the
closing bid and asked prices on such exchange on such trading
day; (ii) if shares of the Common Stock are not so listed but are
traded on the Nasdaq SmallCap Market ("NSCM"), the average of the
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closing prices as reported on the NSCM during the five (5)
consecutive trading days preceding the trading day immediately
prior to such date or, if no sale occurred on a trading day, then
the mean between the highest bid and lowest asked prices as of
the close of business on such trading day, as reported on the
NSCM; or if applicable, the Nasdaq National Market ("NNM"), or if
not then included for quotation on the NNM or NSCM, the average
of the highest reported bid and lowest reported asked prices as
reported by the OTC Bulletin Board or the National Quotations
Bureau, as the case may be; or (iii) if the shares of the Common
Stock are not then publicly traded, the fair market price of the
Common Stock as determined in good faith by the Board of
Directors of the Company.
2. Shares Fully Paid; Payment of Taxes. All shares of Common
Stock issued upon the exercise of a Warrant shall be validly
issued, fully paid and non-assessable, and the Company shall pay
all taxes and other governmental charges (other than income taxes
to the holder) that may be imposed in respect of the issue or
delivery thereof.
3. Transfer and Exchange. This Warrant and all rights hereunder
are transferable, in whole or in part, on the books of the Company
maintained for such purpose at its principal office referred to above
by Holder in person or by duly authorized attorney, upon surrender of
this Warrant together with a completed and executed assignment form in
the form attached as Exhibit B, payment of any necessary transfer tax
or other governmental charge imposed upon such transfer and an opinion
of counsel reasonably acceptable the Company stating that such
transfer is exempt from the registration requirements of the
Securities Act of 1933, as amended (the "1933 Act"). Upon any
partial transfer, the Company will issue and deliver to Holder a
new Warrant or Warrants with respect to the shares of Common
Stock not so transferred. Each taker and holder of this Warrant,
by taking or holding the same, consents and agrees that this
Warrant when endorsed in blank shall be deemed negotiable and
that when this Warrant shall have been so endorsed, the holder
hereof may be treated by the Company and all other persons
dealing with this Warrant as the absolute owner hereof for any
purpose and as the person entitled to exercise the rights
represented hereby, or to the transfer hereof on the books of the
Company, any notice to the contrary notwithstanding; but until
such transfer on such books, the Company may treat the registered
Holder hereof as the owner for all purposes.
This Warrant is exchangeable at such office for
Warrants for the same aggregate number of shares of Common Stock,
each new Warrant to represent the right to purchase such number
of shares as the Holder shall designate at the time of such
exchange.
4. Anti-Dilution Provisions.
-------------------------
A. Adjustment for Dividends in Other Stock and Property
Reclassifications. In case at any time or from time to time the
holders of the Common Stock (or any shares of stock or other
securities at the time receivable upon the exercise of this
Warrant) shall have received, or, on or after the record date
fixed for the determination of eligible shareholders, shall have
become entitled to receive, without payment therefor,
(1) other or additional stock or other securities or
property (other than cash) by way of dividend,
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(2) any cash or other property paid or payable out
of a source other than retained earnings (determined in accordance with
generally accepted accounting principles), or
(3) other or additional stock or other securities
or property (including cash) by way of stock-split, spin-off,
reclassification, combination of shares or similar corporate
rearrangement (other than (x) additional shares of Common Stock
or any other stock or securities into which such Common Stock
shall have been changed, (y) any other stock or securities
convertible into or exchangeable for such Common Stock or such
other stock or securities or (z) any stock purchase rights,
issued as a stock dividend or stock-split, adjustments in respect
of which shall be covered by the terms of Section 4.C, 4.D or
4.E), then and in each such case, Holder, upon the exercise
hereof as provided in Section 1, shall be entitled to receive the
amount of stock and other securities and property (including cash
in the cases referred to in clauses (2) and (3) above) which such
Holder would hold on the date of such exercise if on the Original
Issuance Date Holder had been the holder of record of the number
of shares of Common Stock called for on the face of this Warrant,
as adjusted in accordance with the first paragraph of this
Warrant, and had thereafter, during the period from the Original
Issuance Date to and including the date of such exercise,
retained such shares and/or all other or additional stock and
other securities and property (including cash in the cases
referred to in clause (2) and (3) above) receivable by it as
aforesaid during such period, giving effect to all adjustments
called for during such period by Section 4.A and Section 4.B.
B. Adjustment for Reorganization, Consolidation and Merger.
In case of any reorganization of the Company (or any other
corporation the stock or other securities of which are at the
time receivable on the exercise of this Warrant) after the
Original Issuance Date, or in case, after such date, the Company
(or any such other corporation) shall consolidate with or merge
into another corporation or entity or convey all or substantially
all its assets to another corporation or entity, then and in each
such case Holder, upon the exercise hereof as provided in
Section 1 at any time after the consummation of such
reorganization, consolidation, merger or conveyance, shall be
entitled to receive, in lieu of the stock or other securities and
property receivable upon the exercise of this Warrant prior to
such consummation, the stock or other securities or property to
which such Holder would have been entitled upon such consummation
if Holder had exercised this Warrant immediately prior thereto,
all subject to further adjustment as provided in Sections 4.A,
4.B, 4.C, 4.D, and 4.E; in each such case, the terms of this
Warrant shall be applicable to the shares of stock or other
securities or property receivable upon the exercise of this
Warrant after such consummation.
C. Sale of Shares Below Purchase Price.
------------------------------------
(1) Subject to the exceptions set forth in Section 4.C(5),
until the earlier to occur of (i) the effective date of a public
offering of the Company's securities at no less than seventy-five
(75%) percent of the then current Purchase Price of this Warrant
and in which no less than $5,000,000 in gross proceeds are
raised, and (ii) the date eighteen (18) months following the
Original Issuance Date, if the Company issues or sells, or is
deemed by the express provisions of this Section 4.C to have
issued or sold, Additional Shares of Common Stock (as hereinafter
defined), other than as a dividend or other distribution on any
class of stock as provided in Section 4.D and other than upon a
subdivision or combination of shares of Common Stock as provided
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in Section 4.E, for an Effective Price (as hereinafter defined)
less than the then existing Purchase Price, then and in each such
case:
(A) the then existing Purchase Price shall be
reduced, as of the opening of business on the date of such issue or
sale, as follows: the Purchase Price shall be reduced to a price
determined by multiplying that Purchase Price by a fraction
(i) the numerator of which shall be (a) the number of shares of
Common Stock outstanding at the close of business on the day next
preceding the date of such issue or sale, plus (b) the number of
shares of Common Stock which the aggregate consideration received
(or by the express provisions hereof deemed to have been
received) by the Company for the total number of Additional
Shares of Common Stock so issued would purchase at the Effective
Price, plus (c) the number of shares of Common Stock for which
all Warrants, and all other options and warrants outstanding as
of the Original Issuance Date that are exercisable for shares of
Common Stock are exercisable at the Purchase Price in effect at
the close of business on the date next preceding the date of such
issue or sale, plus (d) the number of shares of Common Stock
underlying all Other Securities (as hereinafter defined) at the
close of business on the date next preceding the date of such
issue or sale, and (ii) the denominator of which shall be (a) the
number of shares of Common Stock outstanding at the close of
business on the date of such issue or sale after giving effect to
such issue of Additional Shares of Common Stock, plus (b) the
number of shares of Common Stock for which all Warrants and all
other options and warrants outstanding on the Original Issuance
Date that are exercisable for shares of Common Stock are
exercisable at the Purchase Price in effect at the close of
business on the date next preceding the date of such issue or
sale, plus (c) the number of shares of Common Stock underlying
the Other Securities at the close of business on the date next
preceding the date of such issue or sale; and
(2) For the purpose of making any adjustment required
under this Section 4.C, the consideration received by the Company for
any issue or sale of securities shall (i) to the extent it consists
of cash be computed at the amount of cash received by the
Company, (ii) to the extent it consists of property other than
cash, be computed at the fair value of that property as
determined in good faith by the Board, (iii) if Additional Shares
of Common Stock, Convertible Securities (as hereinafter defined)
or rights or options to purchase either Additional Shares of
Common Stock or Convertible Securities are issued or sold
together with other stock or securities or other assets of the
Company for a consideration which covers both, be computed as the
portion of the consideration so received that may be reasonably
determined in good faith by the Board to be allocable to such
Additional Shares of Common Stock, Convertible Securities or
rights or options, and (iv) be computed after reduction for all
expenses payable by the Company in connection with such issue or
sale.
(3) For the purpose of the adjustment required under
this Section 4.C, if the Company issues or sells any rights or options
for the purchase of, or stock or other securities convertible
into or exchangeable for, Additional Shares of Common Stock (such
convertible or exchangeable stock or securities being hereinafter
referred to as "Convertible Securities") and if the Effective
Price of such Additional Shares of Common Stock is less than the
Purchase Price then in effect, then the Company shall be deemed
to have issued at the time of the issuance of such rights or
options or Convertible Securities the maximum number of
Additional Shares of Common Stock issuable upon exercise,
conversion or exchange thereof and to have received as
consideration for the issuance of such shares an amount equal to
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the total amount of the consideration, if any, received by the
Company for the issuance of such rights or options or Convertible
Securities, plus, in the case of such rights or options, the
minimum amounts of consideration, if any, payable to the Company
upon the exercise of such rights or options, plus, in the case of
Convertible Securities, the minimum amounts of consideration, if
any, payable to the Company (other than by cancellation of
liabilities or obligations evidenced by such Convertible
Securities) upon the conversion or exchange thereof. No further
adjustment of the Purchase Price, adjusted upon the issuance of
such rights, options or Convertible Securities, shall be made as
a result of the actual issuance of Additional Shares of Common
Stock on the exercise of any such rights or options or the
conversion or exchange of any such Convertible Securities. If any
such rights or options or the conversion or exchange privilege
represented by any such Convertible Securities shall expire
without having been exercised, the Purchase Price adjusted upon
the issuance of such rights, options or Convertible Securities
shall be readjusted to the Purchase Price which would have been
in effect had an adjustment been made on the basis that the only
Additional Shares of Common Stock so issued were the Additional
Shares of Common Stock, if any, actually issued or sold on the
exercise of such rights or options or rights of conversion or
exchange of such Convertible Securities, and such Additional
Shares of Common Stock, if any, were issued or sold for the
consideration actually received by the Company upon such
exercise, plus the consideration, if any, actually received by
the Company for the granting of all such rights or options,
whether or not exercised, plus the consideration received for
issuing or selling the Convertible Securities actually converted
or exchanged, plus the consideration, if any, actually received
by the Company (other than by cancellation of liabilities or
obligations evidenced by such Convertible Securities) on the
conversion or exchange of such Convertible Securities.
(4) For the purpose of the adjustment required under
this Section 4.C, if the Company issues or sells, or is deemed by the
express provisions of this subsection to have issued or sold, any
rights or options for the purchase of Convertible Securities and
if the Effective Price of the Additional Shares of Common Stock
underlying such Convertible Securities is less than the Purchase
Price then in effect, then in each such case the Company shall be
deemed to have issued at the time of the issuance of such rights
or options the maximum number of Additional Shares of Common
Stock issuable upon conversion or exchange of the total amount of
Convertible Securities covered by such rights or options and to
have received as consideration for the issuance of such
Additional Shares of Common Stock an amount equal to the amount
of consideration, if any, received by the Company for the
issuance of such rights or options, plus the minimum amounts of
consideration, if any, payable to the Company upon the exercise
of such rights or options and plus the minimum amount of
consideration, if any, payable to the Company (other than by
cancellation of liabilities or obligations evidenced by such
Convertible Securities) upon the conversion or exchange of such
Convertible Securities. No further adjustment of the Purchase
Price, adjusted upon the issuance of such rights or options,
shall be made as a result of the actual issuance of the
Convertible Securities upon the exercise of such rights or
options or upon the actual issuance of Additional Shares of
Common Stock upon the conversion or exchange of such Convertible
Securities. The provisions of paragraph (3) above for the
readjustment of the Purchase Price upon the expiration of rights
or options or the rights of conversion or exchange of Convertible
Securities shall apply mutatis mutandis to the rights, options
and Convertible Securities referred to in this paragraph (4).
-6-
(5) "Additional Shares of Common Stock" shall mean
all shares of Common Stock issued by the Company on or after the
Original Issuance Date, whether or not subsequently reacquired or
retired by the Company other than (i) shares of Common Stock issuable
upon exercise of the Warrants, (ii) shares of Common Stock
issuable upon exercise of warrants and options to purchase Common
Stock issued and outstanding as of the Original Issuance Date,
(iii) shares of Common Stock issued to non-affiliated third
parties in connection with any bona fide mergers, acquisitions,
business combinations, strategic ventures and product and
intellectual property acquisitions, (iv) shares of Common Stock
issued pursuant to the exercise of stock options granted under
Company stock option plans, (v) shares of Common Stock issued as
dividends and/or interest payments in lieu of cash payments, and
(vi) shares of Common Stock issued in connection with public
offerings of the Company's securities and private placements
conducted through the Placement Agent and/or its affiliates
(including, but not limited to, upon exercise of placement agent
warrants and warrants issued to investors). The "Effective
Price" of Additional Shares of Common Stock shall mean the
quotient determined by dividing the total number of Additional
Shares of Common Stock issued or sold, or deemed to have been
issued or sold by the Company under this Section 4.C, into the
aggregate consideration received, or deemed to have been
received, by the Company for such issue under this Section 4.C,
for such Additional Shares of Common Stock. "Other Securities"
with respect to an issue or sale of Additional Shares of Common
Stock shall mean Convertible Securities; "the number of shares of
Common Stock underlying Other Securities" on a particular date
shall mean the number of shares of Common Stock issuable upon the
exercise, conversion or exchange, as the case may be, of such
Other Securities at the close of business on such date.
(6) Other than a reduction pursuant to its applicable
anti-dilution provisions, any reduction in the conversion price
of any Convertible Security, whether outstanding on the Original
Issuance Date or thereafter, or the subscription price of any
option, warrant or right to purchase Common Stock or any
Convertible Security (whether such option, warrant or right is
outstanding on the Original Issuance Date or thereafter), to an
Effective Price less than the Fair Market Value or the then
Purchase Price shall be deemed to be an issuance of such
Convertible Security and the issuance of all such options,
warrants or subscription rights, and the provisions of
Sections 4.C.(3), (4) and (5) shall apply thereto mutatis
mutandis.
(7) In case any shares of stock or other securities,
other than Common Stock, shall at the time be receivable upon the
exercise of this Warrant, and in case any additional shares of such
stock or any additional such securities (or any stock or other
securities convertible into or exchangeable for any such stock or
securities) shall be issued or sold for a consideration per share
such as to dilute the purchase rights evidenced by this Warrant,
then and in each such case the Purchase Price shall forthwith be
adjusted, substantially in the manner provided for above in this
Section 4.C, so as to protect the Holder of this Warrant against
the effect of such dilution.
(8) In case the Company shall take a record of the
holders of shares of its stock of any class for the purpose of
entitling them (a) to receive a dividend or a distribution payable
in Common Stock or in Convertible Securities, or (b) to subscribe
for, purchase or otherwise acquire Common Stock or Convertible
Securities, then such record date shall be deemed to be the date
of the issue or sale of the Additional Shares of Common Stock
issued or sold or deemed to have been issued or sold upon the
declaration of such dividend or the making of such other
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distribution, or the date of the granting of such rights of
subscription, purchase or other acquisition, as the case may be.
(9) No adjustment in the Purchase Price shall be required
unless such adjustment would require an increase or decrease of at least
one cent ($0.01) in such price; provided, however, that any
adjustments which by reason of this Section 4 are not required to
be made shall be carried forward and taken into account in any
subsequent adjustment required to be made hereunder. All
calculations under this Section 4 shall be made to the nearest
cent or to the nearest one-hundredth of a share, as the case may
be.
D. Adjustment for Certain Dividends and Distributions. If
the Company at any time or from time to time makes, or fixes a record
date for the determination of holders of Common Stock entitled to
receive, a dividend or other distribution payable in additional
shares of Common Stock, then and in each such event:
(1) the Purchase Price then in effect shall be decreased
as of the time of such issuance or, in the event such record date is
fixed, as of the close of business on such record date, by
multiplying the Purchase Price then in effect by a fraction
(A) the numerator of which is the total number of shares of
Common Stock issued and outstanding immediately prior to the time
of such issuance or the close of business on such record date,
and (B) the denominator of which shall be the total number of
shares of Common Stock issued and outstanding immediately prior
to the time of such issuance or the close of business on such
record date as the case may be, plus the number of shares of
Common Stock issuable in payment of such dividend or
distribution; provided, however, that if such record date is
fixed and such dividend is not fully paid or if such distribution
is not fully made on the date fixed therefor, the Purchase Price
shall be recomputed accordingly as of the close of business on
such record date, and thereafter the Purchase Price shall be
adjusted pursuant to this Section 4.D as of the time of actual
payment of such dividends or distributions; and
(2) the number of shares of Common Stock theretofore
receivable upon the exercise of this Warrant shall be increased, as of
the time of such issuance or, in the event such record date is fixed,
as of the close of business on such record date, in inverse
proportion to the decrease in the Purchase Price.
E. Stock Split and Reverse Stock Split. If the Company at any
time or from time to time effects a stock split or subdivision of
the outstanding Common Stock, the Purchase Price then in effect
immediately before that stock split or subdivision shall be
proportionately decreased and the number of shares of Common
Stock theretofore receivable upon the exercise of this Warrant
shall be proportionately increased. If the Company at any time or
from time to time effects a reverse stock split or combines the
outstanding shares of Common Stock into a smaller number of
shares, the Purchase Price then in effect immediately before that
reverse stock split or combination shall be proportionately
increased and the number of shares of Common Stock theretofore
receivable upon the exercise of this Warrant shall be
proportionately decreased. Each adjustment under this Section 4.E
shall become effective at the close of business on the date the
stock split, subdivision, reverse stock split or combination
becomes effective.
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F. Certificate as to Adjustments. Upon the occurrence
of each adjustment or readjustment of the Conversion Price pursuant
to this Section 4, the Company at its expense shall promptly compute
such adjustment or readjustment in accordance with the terms
hereof and furnish to each holder of a Warrant a certificate
setting forth such adjustment or readjustment and showing in
detail the facts upon which such adjustment or readjustment is
based. The Company shall, upon the written request at any time of
any holder of a Warrant, furnish or cause to be furnished to such
holder a like certificate setting forth (i) such adjustments and
readjustments, (ii) Purchase Price at the time in effect, and
(iii) the number of shares of Common Stock and the amount, if
any, of other property which at the time would be received upon
the exercise of the Warrant.
5. Notices of Record Date. In case:
--------------------------------
A. the Company shall take a record of the holders of its
Common Stock (or other stock or securities at the time receivable upon
the exercise of the Warrants) for the purpose of entitling them
to receive any dividend or other distribution, or any right to
subscribe for or purchase any shares of stock of any class or any
other securities, or to receive any other right, or
B. of any capital reorganization of the Company, any
reclassification of the capital stock of the Company, any
consolidation or merger of the Company with or into another
corporation, or any conveyance of all or substantially all of the
assets of the Company to another corporation, or
C. of any voluntary dissolution, liquidation or winding-up
of the Company, then, and in each such case, the Company will mail or
cause to be mailed to each holder of a Warrant at the time outstanding
a notice specifying, as the case may be, (a) the date on which a
record is to be taken for the purpose of such dividend,
distribution or right, and stating the amount and character of
such dividend, distribution or right, or (b) the date on which
such reorganization, reclassification, consolidation, merger,
conveyance, dissolution, liquidation or winding-up is expected to
take place, and the time, if any is to be fixed, as of which the
holders of record of Common Stock (or such stock or securities at
the time receivable upon the exercise of the Warrants) shall be
entitled to exchange their shares of Common Stock (or such other
stock or securities) for securities or other property deliverable
upon such reorganization, reclassification, consolidation,
merger, conveyance, dissolution, liquidation or winding-up, such
notice shall be mailed at least ten (10) days prior to the date
therein specified.
6. Loss or Mutilation. Upon receipt by the Company of evidence
satisfactory to it (in the exercise of reasonable discretion) of
the ownership of and the loss, theft, destruction or mutilation
of any Warrant and (in the case of loss, theft or destruction) of
indemnity satisfactory to it (in the exercise of reasonable
discretion), and (in the case of mutilation) upon surrender and
cancellation thereof, the Company will execute and deliver in
lieu thereof a new Warrant of like tenor.
7. Reservation of Common Stock. The Company shall at all times
reserve and keep available for issue upon the exercise of
Warrants such number of its authorized but unissued shares of
Common Stock as will be sufficient to permit the exercise in full
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of all outstanding Warrants. All of the shares of Commons Stock
issuable upon the exercise of the rights represented by this
Warrant will, upon issuance and receipt of the Purchase Price
therefor, be fully paid and nonassessable, and free from all
preemptive rights, rights of first refusal or first offer, taxes,
liens and charges of whatever nature, with respect to the
issuance thereof.
8. Registration Rights Agreement. The Holder of this Warrant is
entitled to have the shares of Common Stock purchased in the
Offering and the Warrant Shares issuable upon exercise of this
Warrant registered for resale under the 1933 Act, pursuant to and
in accordance with the Registration Rights Agreement dated as of
the date hereof by and between the Holder and the Company.
9. Notices. All notices and other communications from the
Company to the Holder of this Warrant shall be mailed by first
class, registered or certified mail, postage prepaid, to the
address furnished to the Company in writing by the Holder.
10. Change; Modifications; Waiver. No terms of this Warrant may
be amended, waived or modified except by the express written
consent of the Company and the holders of not less than 50.1% of
the then outstanding Warrants.
11. Headings. The headings in this Warrant are for purposes of
convenience in reference only, and shall not be deemed to
constitute a part hereof.
12. Governing Law, Etc. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of
New York without regard to the conflicts of laws principles
thereof. The parties hereto hereby irrevocably agree that any
suit or proceeding arising directly and/or indirectly pursuant to
or under this Agreement, shall be brought solely in a federal or
state court located in the City, County and State of New York. By
its execution hereof, the parties hereby covenant and irrevocably
submit to the in personam jurisdiction of the federal and state
courts located in the City, County and State of New York and
agree that any process in any such action may be served upon any
of them personally, or by certified mail or registered mail upon
them or their agent, return receipt requested, with the same full
force and effect as if personally served upon them in New York
City. The parties hereto waive any claim that any such
jurisdiction is not a convenient forum for any such suit or
proceeding and any defense or lack of in personam jurisdiction
with respect thereto. In the event of any such action or
proceeding, the party prevailing therein shall be entitled to
payment from the other party hereto of all of its reasonable
legal fees and expenses.
13. Redemption of Warrants.
A. On not less than ten (10) days prior written notice
(the "Redemption Notice"), to the Holder, the Warrants may be
redeemed, at the option of the Company, at a redemption price of
$0.01 per Warrant (the "Redemption Price"), provided that:
(i) the Market Price (as defined below) for a share of Common
Stock equals or exceeds (a) three hundred (300%) percent of the
then current Purchase Price if the Redemption Date (as defined
below) is a date within the period commencing on the Original
Issuance Date and terminating on the date twelve (12) months
following such date (the "1 Year Anniversary Date"), and (b) two
hundred twenty-five (225%) percent of the Purchase Price if the
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Redemption Date is a date within the period commencing on day
immediately following the 1 Year Anniversary Date and terminating
on the Expiration Date for ten (10) consecutive Trading Days (as
defined below) ending on the 2nd Trading Day prior to the date of
the Redemption Notice; and (ii) if the Redemption Date is during
the period commencing on the Original Issuance Date and
terminating on the date two (2) years thereafter, a registration
statement covering the Warrant Shares filed under the 1933 Act is
declared effective by the Commission and remains effective on the
date fixed for redemption of the Warrants (the "Redemption
Date"). For purposes of this Warrant, (i) "Market Price" is
defined as the Closing Price per share of Common Stock on the
principal Trading Market on which the Common Stock is included
for trading; provided, that if there is no trading in the Common
Stock on a particular Trading Day on the relevant principal
Trading Market, the Market Price for that day shall be the Market
Price on the last preceding Trading Day on which there was
trading in the Common Stock on the principal Trading Market, (ii)
"Closing Price" means on any particular date (a) the last
reported closing price per share of the Common Stock on such date
on the Trading Market (as reported by Bloomberg L.P. at 4:15 p.m.
(New York time) as the last reported closing price for regular
session trading on such day), or (b) if there is no such price on
such date, then the closing price on the Trading Market on the
date nearest preceding such date (as reported by Bloomberg L.P.
at 4:15 p.m. (New York time) as the closing price for regular
session trading on such day), or (c) if the Common Stock is not
then listed or quoted on the Trading Market and if prices for the
Common Stock are then reported in the "pink sheets" published by
the National Quotation Bureau Incorporated (or a similar
organization or agency succeeding to its functions of reporting
prices), the most recent price per share of the Common Stock so
reported, or (d) if the shares of Common Stock are not then
publicly traded the fair market value of a share of Common Stock
as determined by an appraiser selected jointly by the holders of
a majority of the Warrants then outstanding and the Company;
(iii) "Trading Day" means (a) a day on which the Common Stock is
traded on a Trading Market, or (b) if the Common Stock is not
quoted on a Trading Market, a day on which the Common Stock is
quoted in the over-the-counter market as reported by the National
Quotation Bureau Incorporated (or any similar organization or
agency succeeding to its functions of reporting price); provided,
that in the event that the Common Stock is not listed or quoted
as set forth in (a), and (b) hereof, then Trading Day shall mean
a Business Day; and (iv) "Trading Market" means the following
markets or exchanges on which the Common Stock is listed or
quoted for trading on the date in question: the OTC Bulletin
Board, the American Stock Exchange, the New York Stock Exchange,
the Nasdaq National Market or the Nasdaq SmallCap Market.
B. The Redemption Notice shall specify (i) the
Redemption Price, (ii) the Redemption Date, (iii) the place where
the Warrant certificates shall be delivered and the redemption price
paid, and (iv) that the right to exercise this Warrant shall
terminate at 5:00 p.m. (New York time) on the business day
immediately preceding the Redemption Date.
C. Any right to exercise a Warrant shall terminate
at 5:00 p.m. (New York time) on the business day immediately
preceding the Redemption Date. On and after the Redemption Date,
the holder of this Warrant shall have no further rights except to
receive, upon surrender of this Warrant, the Redemption Price.
D. From and after the Redemption Date, the Company
shall, at the place specified in the Redemption Notice, upon
presentation and surrender to the Company by or on behalf of the
holder thereof the warrant certificates evidencing this Warrant
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being redeemed, deliver, or cause to be delivered to or upon the
written order of such holder, a sum in cash equal to the
Redemption Price of this Warrant. From and after the Redemption
Date, this Warrant shall expire and become void and all rights
hereunder and under the warrant certificates, except the right to
receive payment of the Redemption Price, shall cease.
14. Restriction on Exercise by the Holder. Notwithstanding
anything herein to the contrary, from and after such time as
shares of Common Stock shall have become registered under Section
12 of the Securities Exchange Act of 1934 (the "1934 Act"), in no
event shall the Holder have the right or be required to exercise
this Warrant to the extent, and only to the extent, that as a
result of such exercise, the aggregate number of shares of Common
Stock beneficially owned by such Holder and its Affiliates and
any other persons or entities which beneficial ownership of
Common Stock would be aggregated with the Holder for purposes of
Section 13(d) of the 1934 Act (including shares held by any
"group" of which the Holder is a member, but excluding shares
beneficially owned by virtue of the ownership of securities or
rights to acquire securities that have limitations on the right
to convert, exercise or purchase similar to the limitation set
forth herein) would exceed 9.9% of the outstanding shares of the
Common Stock following such exercise. For purposes of this
Section 14, beneficial ownership shall be calculated in
accordance with Section 13(d) of the 1934 Act. The provisions of
this Section 14 may be waived by a Holder as to itself (and
solely as to itself) upon not less than sixty-five (65) days,
prior written notice to the Company, and the provisions of this
Section 14 shall continue to apply until such 65th day (or later,
if stated in the notice of waiver).
15. Counterparts. This Agreement may be signed in counterparts.
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WARRANT SIGNATURE PAGE
----------------------
Dated:
-----------------------
INYX, INC.
By:
-------------------------
Name:
Title:
EXHIBIT A
SUBSCRIPTION FORM
-----------------
(To be executed only upon exercise of Warrant)
The undersigned registered owner of this Warrant irrevocably
exercises this Warrant and purchases _______ of the number of
shares of Common Stock of INYX, Inc., purchasable with this
Warrant, and herewith makes payment therefor (either in cash or
pursuant to the cashless exercise provisions set forth in Section
1A of the Warrant), all at the price and on the terms and
conditions specified in this Warrant.
Dated:
-----------------------
---------------------------------
(Signature of Registered Owner
---------------------------------
(Street Address)
---------------------------------
(City / State / Zip Code)
EXHIBIT B
FORM OF ASSIGNMENT
------------------
FOR VALUE RECEIVED the undersigned registered owner of this
Warrant hereby sells, assigns and transfers unto the Assignee
named below all of the rights of the undersigned under the within
Warrant, with respect to the number of shares of Common Stock set
forth below:
Name of Assignee Address Number of Shares
---------------- ------- ----------------
and does hereby irrevocably constitute and appoint ________________
Attorney to make such transfer on the books of INYX, Inc., maintained
for the purpose, with full power of substitution in the premises.
Dated:
---------------------
---------------------------
(Signature)
---------------------------
(Witness)
The undersigned Assignee of the Warrant hereby makes to
INYX, Inc., as of the date hereof, with respect to the Assignee,
all of the representations and warranties made by the Holder, and
the undersigned Assignee agrees to be bound by all the terms and
conditions of the Warrant and the INYX, Inc. Registration Rights
Agreement, dated as of August __, 2004, by and between INYX, Inc.
and the Holder.
Dated:
--------------------
-----------------------
(Signature)