ISONICS CORPORATION
Exhibit 3 to Form 8-K reporting an event of July 29, 1999
FORM OF WARRANT AGREEMENT
Void after July 29, 2002 Warrant No. 1999-____
Name: to acquire __________ shares
THIS WARRANT AND ANY SHARES ACQUIRED UPON THE EXERCISE OF
THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933. THIS WARRANT AND SUCH SHARES MAY NOT BE SOLD OR TRANSFERRED IN
THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER SAID
ACT. THIS WARRANT AND SUCH SHARES MAY NOT BE TRANSFERRED EXCEPT UPON
THE CONDITIONS SPECIFIED IN THIS WARRANT, AND NO TRANSFER OF THIS
WARRANT OR SUCH SHARES SHALL BE VALID OR EFFECTIVE UNLESS AND UNTIL
SUCH CONDITIONS SHALL HAVE BEEN COMPLIED WITH.
ISONICS CORPORATION
COMMON STOCK PURCHASE WARRANT
Isonics Corporation (the "Company"), having its principal office at 5906
McIntyre Street, Golden, Colorado, 80403 hereby certifies that, for value
received, ___________________, or assigns, is entitled, subject to the terms
set forth below, to purchase from the Company at any time on or from time to
time after July 29, 1999 and before 5:00 P.M., New York City time, on July
29, 2002 or as extended in accordance with the terms hereof (the "Expiration
Date"), _______ fully paid and non-assessable shares of Common Stock of the
Company, at the initial Purchase Price per share (as defined below) of $3.75.
The number and character of such shares of Common Stock and the Purchase
Price per share are subject to adjustment as provided herein.
BACKGROUND. The Company will issue warrants to purchase up to an
aggregate of up to 2,330,000 shares of Common Stock (subject to adjustment as
provided herein) in connection with (i) the Company's private placement (the
"Private Placement") of up to 1,500,000 shares of Series A Convertible
Preferred Stock of the Company, and up to 1,500,000 redeemable common stock
purchase warrants (each a "Private Placement Warrant"), each Warrant
entitling the Holder thereof to purchase one share of Common Stock; and (ii)
the issuance to Adam Smith & Company, Inc. of an additional 500,000 Warrants
(the "ASC Warrants") to purchase up to 500,000 shares of Common Stock, and
(iii) the Company's issuance of up to an additional 330,000 shares of Series
A Convertible Preferred Stock and up to 330,000 private placement warrants of
like tenor (the "Conversion Warrants", and collectively with the Private
Placement Warrants and the ASC Warrants, the "Warrants") to certain persons
in satisfaction of certain debt and contractual obligations as described in
the Subscription Agreement of even date herewith executed in connection with
the Private Placement. This Warrant is one of the Warrants originally issued
as of the Original Issue Date (as defined below).
As used herein the following terms, unless the context otherwise
requires, have the following respective meanings:
The term "Company" includes the Company and any corporation which shall
succeed to or assume the obligations of the Company hereunder.
The term "Common Stock" includes all stock of any class or classes
(however designated) of the Company, authorized upon the Original Issue Date
or thereafter, the Holders of which shall have the right, without limitation
as to amount, either to all or to a share of the balance of current dividends
and liquidating dividends after the payment of dividends and distributions on
any shares entitled to preference, and the Holders of which shall ordinarily,
in the absence of contingencies, be entitled to vote for the election of a
majority of directors of the Company (even though the right so to vote has
been suspended by the happening of such a contingency).
The term "Exchange Act" means the Securities Exchange Act of 1934 as the
same shall be in effect at the time.
The term "Holder" means any record owner of Warrants or Underlying
Securities.
The term "Nasdaq" shall mean the Nasdaq SmallCap Market or other
principal market on which the Common Stock is traded.
The "Original Issue Date" is July 29, 1999, the date as of which the
Warrants were first issued.
The term "Other Securities" refers to any stock (other than Common
Stock) and other securities of the Company or any other person (corporate or
otherwise) which the Holders of the Warrants at any time shall be entitled to
receive, or shall have received, upon the exercise of the Warrants, in lieu
of or in addition to Common Stock, or which at any time shall be issuable or
shall have been issued in exchange for or in replacement of Common Stock or
Other Securities pursuant to section 6 or otherwise.
The term "Purchase Price per share" shall be the then applicable
exercise price for one share of Common Stock.
The terms "registered" and "registration" refer to a registration
effected by filing a registration statement in compliance with the Securities
Act, to permit the disposition of Common Stock (or Other Securities) issued
or issuable upon the exercise of Warrants, and any post-effective amendments
and supplements filed or required to be filed to permit any such disposition.
The term "Securities Act" means the Securities Act of 1933 as the same
shall be in effect at the time.
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The term "Series A Preferred Stock" shall mean the 1,500,000 shares of
Series A Convertible Preferred Stock of the Company issued simultaneously
with the issuance of the Private Placement Warrants and the 330,000 shares of
Series A Convertible Preferred Stock of the Company to be issued upon the
conversion of certain debt of the Company, as described in the Subscription
Agreement of even date herewith executed in connection with the Private
Placement.
The term "Underlying Securities" shall mean any Common Stock or Other
Securities issued or issuable upon exercise of Warrants.
The term "Warrant" shall mean, as applicable, this Warrant or each right
as set forth in this Warrant to purchase one share of Common Stock, as
adjusted.
1. REGISTRATION, ETC.
1.1. The Holder shall have the rights to registration of Underlying
Securities issuable upon exercise of the Warrants that are set forth in the
Registration Rights Agreement, dated the date hereof between the Company and
the Holder (the "Registration Rights Agreement").
2. SALE OR EXERCISE WITHOUT REGISTRATION. If, at the time of any
exercise, transfer or surrender for exchange of a Warrant or of Underlying
Securities previously issued upon the exercise of Warrants, such Warrant or
Underlying Securities shall not be registered under the Securities Act, the
Company may require, as a condition of allowing such exercise, transfer or
exchange, that the Holder or transferee of such Warrant or Underlying
Securities, as the case may be, furnish to the Company a satisfactory opinion
of counsel to the effect that such exercise, transfer or exchange may be made
without registration under the Securities Act, provided that the disposition
thereof shall at all times be within the control of such Holder or
transferee, as the case may be, and provided further that nothing contained
in this section 2 shall relieve the Company from complying with any request
for registration pursuant to the Registration Rights Agreement. The first
Holder of this Warrant, by acceptance hereof, represents to the Company that
it is acquiring the Warrants for investment and not with a view to the
distribution thereof.
3. EXERCISE OF WARRANT.
3.1. EXERCISE IN FULL. Subject to the provisions hereof, this
Warrant may be exercised in full by the Holder hereof by surrender of this
Warrant, with the form of subscription at the end hereof duly executed by
such Holder, to the Company at its principal office accompanied by payment,
in cash or by certified or official bank check payable to the order of the
Company, in the amount obtained by multiplying the number of shares of Common
Stock called for on the face of this Warrant (without giving effect to any
adjustment therein) by the Purchase Price per share.
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3.2. PARTIAL EXERCISE. Subject to the provisions hereof, this
Warrant may be exercised in part by surrender of this Warrant in the manner
and at the place provided in subsection 3.1 except that the amount payable by
the Holder upon any partial exercise shall be the amount obtained by
multiplying (a) the number of shares of Common Stock (without giving effect
to any adjustment therein) designated by the Holder in the subscription at
the end hereof by (b) the Purchase Price per share. Upon any such partial
exercise, the Company at its expense will forthwith issue and deliver to or
upon the order of the Holder hereof a new Warrant or Warrants of like tenor,
in the name of the Holder hereof or as such Holder (upon payment by such
Holder of any applicable transfer taxes) may request, calling in the
aggregate on the face or faces thereof for the number of shares of Common
Stock equal (without giving effect to any adjustment therein) to the number
of such shares called for on the face of this Warrant minus the number of
such shares designated by the Holder in the subscription at the end hereof.
3.3. EXERCISE BY SURRENDER OF WARRANT OR SHARES OF COMMON STOCK.
In addition to the method of payment set forth in sections 3.1 and 3.2 and in
lieu of any cash payment required thereunder, the Holder(s) of the Warrants
shall have the right at any time and from time to time to exercise the
Warrants in full or in part by surrendering shares of Common Stock or the
Warrant Certificate in the manner and at the place specified in section 3.1
as payment of the aggregate Purchase Price per share for the Warrants to be
exercised. The number of Warrants or shares of Common Stock to be surrendered
in payment of the aggregate Purchase Price for the Warrants to be exercised
shall be determined by multiplying the number of Warrants to be exercised by
the Purchase Price per share, and then dividing the product thereof by an
amount equal to the Market Price (as defined below).
3.4. DEFINITION OF MARKET PRICE. As used herein, the phrase
"Market Price" at any date shall be deemed to be (i) if the principal trading
market for such securities is an exchange, the last reported sale price, or,
in case no such reported sale takes place on such date, the last reported
sale prices for the last previous trading days in which a sale was reported,
in either case as officially reported on any consolidated tape, (ii) if the
principal market for such securities is the over-the-counter market, the high
bid price on such trading days as set forth by Nasdaq or, (iii) if the
security is not quoted on Nasdaq, the high bid price as set forth in the
National Quotation Bureau sheet listing such securities for such day.
Notwithstanding the foregoing, if there is no reported closing price or high
bid price, as the case may be, on any of the ten trading days preceding the
event requiring a determination of Market Price hereunder, then the Market
Price shall be determined in good faith by resolution of the Board of
Directors of the Company, based on the best information available to it.
3.5. COMPANY TO REAFFIRM OBLIGATIONS. The Company will, at the
time of any exercise of this Warrant, upon the request of the Holder hereof,
acknowledge in writing its continuing obligation to afford to such Holder any
rights (including, without limitation, any right to registration of the
Underlying Securities) to which such Holder shall continue to be entitled
after such exercise in accordance with the provisions of this Warrant,
PROVIDED that if the Holder of this Warrant shall fail to make any such
request, such failure shall not affect the continuing obligation of the
Company to afford such Holder any such rights.
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4. DELIVERY OF STOCK CERTIFICATES, ETC., ON EXERCISE. As soon as
practicable after the exercise of this Warrant in full or in part, and in any
event within three business days thereafter, the Company at its own expense
(including the payment by it of any applicable issue taxes) will cause to be
issued in the name of and delivered to the Holder hereof, or as such Holder
(upon payment by such Holder of any applicable transfer taxes) may direct, a
certificate or certificates for the number of full paid and non-assessable
shares of Common Stock or Other Securities to which such Holder shall be
entitled upon such exercise, plus, in lieu of any fractional share to which
such Holder would otherwise be entitled, cash equal to such fraction
multiplied by the then current Market Price of one full share, together with
any other stock or other securities and property (including cash, where
applicable) to which such Holder is entitled upon such exercise pursuant to
section 5 or otherwise.
5. ADJUSTMENT FOR DIVIDENDS IN OTHER STOCK, PROPERTY, ETC.;
RECLASSIFICATION, ETC. In case at any time or from time to time after the
Original Issue Date the holders of Common Stock (or Other Securities) shall
have received, or (on or after the record date fixed for the determination of
stockholders eligible to receive) shall have become entitled to receive,
without payment therefor
(a) other or additional stock or other securities or property (other
than cash) by way of dividend, or
(b) any cash paid or payable (including, without limitation, by way
of dividend), or
(c) other or additional (or less) stock or other securities or
property (including cash) by way of spin-off, split-up, reclassification,
recapitalization, combination of shares or similar corporate rearrangement,
then, and in each such case the Holder of this Warrant, upon the exercise
hereof as provided in section 3, shall be entitled to receive the amount of
stock and other securities and property (including cash in the cases referred
to in subdivisions (b) and (c) of this section 5) which such Holder would
hold on the date of such exercise if on the Original Issue Date such Holder
had been the Holder of record of the number of shares of Common Stock called
for on the face of this Warrant and had thereafter, during the period from
the Original Issue Date to and including the date of such exercise, retained
such shares and all such other or additional (or less) stock and other
securities and property (including cash in the cases referred to in
subdivisions (b) and (c) of this section 5) receivable by such Holder as
aforesaid during such period, giving effect to all adjustments called for
during such period by sections 6 and 7 hereof.
6. REORGANIZATION, CONSOLIDATION, MERGER, ETC.
In case the Company after the Original Issue Date shall (a) effect
a reorganization, (b) consolidate with or merge into any other person, or (c)
transfer all or substantially all of its properties or assets to any other
person under any plan or arrangement
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contemplating the dissolution of the Company, then, in each such case, the
Holder of this Warrant, upon the exercise hereof as provided in section 3 at
any time after the consummation of such reorganization, consolidation or
merger or the effective date of such dissolution, as the case may be, shall
be entitled to receive (and the Company shall be entitled to deliver), in
lieu of the Underlying Securities issuable upon such exercise prior to such
consummation or such effective date, the stock and other securities and
property (including cash) to which such Holder would have been entitled upon
such consummation or in connection with such dissolution, as the case may be,
if such Holder had so exercised this Warrant immediately prior thereto, all
subject to further adjustment thereafter as provided in sections 5 and 7
hereof. The Company shall not effect any such reorganization, consolidation,
merger or sale, unless prior to or simultaneously with the consummation
thereof, the successor corporation resulting from such consolidation or
merger or the corporation purchasing such assets or the appropriate
corporation or entity shall assume, by written instrument, the obligation to
deliver to each Holder the shares of stock, cash, other securities or assets
to which, in accordance with the foregoing provisions, each Holder may be
entitled to and all other obligations of the Company under this Warrant.
7. OTHER ADJUSTMENTS.
7.1. GENERAL. In any case to which sections 5 and 6 hereof are not
applicable, where the Company shall issue or sell shares of its Common Stock
after the Original Issue Date for a consideration per share less than the
Purchase Price per share in effect pursuant to the terms of this Warrant at
the time of issuance or sale of such additional shares (the "Lower Exercise
Price"), then the Purchase Price in effect hereunder shall simultaneously
with such issuance or sale be reduced to an amount equal to the Purchase
Price in effect immediately prior to such issuance or sale (the "Prior
Conversion Price") multiplied by a fraction, the numerator of which is the
sum of (x) the total number of shares of Common Stock outstanding immediately
prior to such issuance and (y) the number of shares of the Common Stock which
the aggregate consideration received for the total number of additional
shares of the Common Stock being issued would purchase at the Prior
Conversion Price, and the denominator of which is the sum of (a) the total
number of shares of Common Stock outstanding immediately prior to such
issuance and (b) the number of shares of Common Stock being issued. In the
event of an adjustment to the Purchase Price under this section 7, the number
of shares of Underlying Securities issuable upon exercise hereof shall be
increased so that the aggregate exercise price of this Warrant is not reduced
as a result of such reduction of Purchase Price.
7.2. CONVERTIBLE SECURITIES. (a) In case the Company shall issue
or sell any securities convertible into Common Stock of the Company
("Convertible Securities") after the date hereof, there shall be determined
the price per share for which Common Stock is issuable upon the conversion or
exchange thereof, such determination to be made by dividing (a) the total
amount received or receivable by the Company as consideration for the issue
or sale of such Convertible Securities, plus the minimum aggregate amount of
additional consideration, if any, payable to the Company upon the conversion
or exchange thereof, by (b) the maximum number of shares of Common Stock of
the Company issuable upon the conversion or exchange of all of such
Convertible Securities.
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(b) If the price per share so determined shall be less than
the applicable Purchase Price per share, then such issue or sale shall be
deemed to be an issue or sale for cash (as of the date of issue or sale of
such Convertible Securities) of such maximum number of shares of Common Stock
at the price per share so determined, provided that, if such Convertible
Securities shall by their terms provide for an increase or increases or
decrease or decreases, with the passage of time, in the amount of additional
consideration, if any, to the Company, or in the rate of exchange, upon the
conversion or exchange thereof, the adjusted Purchase Price per share shall,
forthwith upon any such increase or decrease becoming effective, be
readjusted to reflect the same, and provided further, that upon the
expiration of such rights of conversion or exchange of such Convertible
Securities, if any thereof shall not have been exercised, the adjusted
Purchase Price per share shall forthwith be readjusted and thereafter be the
price which it would have been had an adjustment been made on the basis that
the only shares of Common Stock so issued or sold were issued or sold upon
the conversion or exchange of such Convertible Securities, and that they were
issued or sold for the consideration actually received by the Company upon
such conversion or exchange, plus the consideration, if any, actually
received by the Company for the issue or sale of all of such Convertible
Securities which shall have been converted or exchanged.
7.3. RIGHTS AND OPTIONS. (a) In case the Company shall grant any
rights or options to subscribe for, purchase or otherwise acquire Common
Stock (other than pursuant to an incentive plan for employees adopted by a
majority of the stockholders of the Company providing for the issuance of
options to purchase no more than an aggregate of 500,000 shares of Common
Stock at a price no less than 85% of fair market value), there shall be
determined the price per share for which Common Stock is issuable upon the
exercise of such rights or options, such determination to be made by dividing
(i) the total amount, if any, received or receivable by the Company as
consideration for the granting of such rights or options, plus the minimum
aggregate amount of additional consideration payable to the Company upon the
exercise of such rights or options, by (ii) the maximum number of shares of
Common Stock of the Company issuable upon the exercise of such rights or
options.
(b) If the price per share so determined shall be less than
the applicable Purchase Price per share, then the granting of such rights or
options shall be deemed to be an issue or sale for cash (as of the date of
the granting of such rights or options) of such maximum number of shares of
Common Stock at the price per share so determined, provided that, if such
rights or options shall by their terms provide for an increase or increases
or decrease or decreases, with the passage of time, in the amount of
additional consideration payable to the Company upon the exercise thereof,
the adjusted Purchase Price per share shall, forthwith upon any such increase
or decrease becoming effective, be readjusted to reflect the same, and
provided, further, that upon the expiration of such rights or options, if any
thereof shall not have been exercised, the adjusted Purchase Price per share
shall forthwith be readjusted and thereafter be the price which it would have
been had an adjustment been made on the basis that the only shares of Common
Stock so issued or sold were those issued or sold upon the exercise of such
rights or options and that they 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.
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7.4. EXCEPTIONS. This Section 7 shall not apply to (a) the issuance of
the Series A Preferred Stock, (b) the issuance of shares of Common Stock upon
conversion of the Series A Preferred Stock, (c) upon the exercise of the
Warrants aggregating not in excess of 2,330,000 shares, (d) issuances of
Common Stock, Convertible Securities, rights and options that have been
approved by the holders of not less than a majority of the outstanding shares
of Series A Preferred Stock, or (e) issuances of Common Stock pursuant to the
exercise of options, warrants and rights outstanding on the date hereof.
8. FURTHER ASSURANCES. The Company will 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 shares of stock upon the exercise of all
Warrants from time to time outstanding.
9. ACCOUNTANTS' CERTIFICATE AS TO ADJUSTMENTS. In each case of any
adjustment or readjustment in the shares of Common Stock (or Other
Securities) issuable upon the exercise of the Warrants, the Company at its
expense will promptly cause the Company's regularly retained auditor to
compute such adjustment or readjustment in accordance with the terms of the
Warrants and prepare a certificate setting forth such adjustment or
readjustment and showing in detail the facts upon which such adjustment or
readjustment is based, and the number of shares of Common Stock outstanding
or deemed to be outstanding. The Company will forthwith mail a copy of each
such certificate to each Holder.
10. NOTICES OF RECORD DATE, ETC. In the event of
(a) any taking by the Company of a record of the Holders of any class
of securities for the purpose of determining the Holders thereof who are
entitled to receive any dividend or other distribution, or any right to
subscribe for, purchase or otherwise acquire any shares of stock of any
class or any other securities or property, or to receive any other right,
or
(b) any capital reorganization of the Company, any reclassification
or recapitalization of the capital stock of the Company or any transfer of
all or substantially all the assets of the Company to or consolidation or
merger of the Company with or into any other person, or
(c) any voluntary or involuntary dissolution, liquidation or
winding-up of the Company, or
(d) any proposed issue or grant by the Company of any shares of stock
of any class or any other securities, or any right or option to subscribe
for, purchase or otherwise acquire any shares of stock of any class or any
other securities (other than the issue of Common Stock on the exercise of
the Warrants), then and in each such event the Company will mail or cause
to be mailed to each Holder of a Warrant a notice specifying (i) the date
on which any such record is to be taken for the purpose of such dividend,
distribution or right, and stating the amount and
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character of such dividend, distribution or right, (ii) the date on
which any such reorganization, reclassification, recapitalization,
transfer, consolidation, merger, dissolution, liquidation or winding-up
is to take place, and the time, if any, as of which the Holders of record
of Underlying Securities shall be entitled to exchange their shares of
Underlying Securities for securities or other property deliverable upon
such reorganization, reclassification, recapitalization, transfer,
consolidation, merger, dissolution, liquidation or winding-up, and (iii)
the amount and character of any stock or other securities, or rights or
options with respect thereto, proposed to be issued or granted, the date of
such proposed issue or grant and the persons or class of persons to whom
such proposed issue or grant and the persons or class of persons to whom
such proposed issue or grant is to be offered or made. Such notice shall
be mailed at least 20 days prior to the date therein specified.
11. RESERVATION OF STOCK, ETC., ISSUABLE ON EXERCISE OF WARRANTS. The
Company will at all times reserve and keep available, solely for issuance and
delivery upon the exercise of the Warrants, all shares of Common Stock (or
Other Securities) from time to time issuable upon the exercise of the
Warrants.
12. LISTING ON SECURITIES EXCHANGES; REGISTRATION. In furtherance and
not in limitation of any other provision of this Warrant, if the Company at
any time shall list any Common Stock on any national securities exchange and
shall register such Common Stock under the Exchange Act, the Company will, at
its expense, simultaneously list on such exchange or Nasdaq, upon official
notice of issuance upon the exercise of the Warrants, and maintain such
listing of all shares of Common Stock from time to time issuable upon the
exercise of the Warrants; and the Company will so list on any national
securities exchange or Nasdaq, will so register and will maintain such
listing of, any Other Securities if and at the time that any securities of
like class or similar type shall be listed on such national securities
exchange or Nasdaq by the Company.
13. EXCHANGE OF WARRANTS. Subject to the provisions of section 2
hereof, upon surrender for exchange of any Warrant, properly endorsed, to the
Company, as soon as practicable (and in any event within three business days)
the Company at its own expense will issue and deliver to or upon the order of
the Holder thereof a new Warrant or Warrants of like tenor, in the name of
such Holder or as such Holder (upon payment by such Holder of any applicable
transfer taxes) may direct, calling in the aggregate on the face or faces
thereof for the number of shares of Common Stock called for on the face or
faces of the Warrant or Warrants so surrendered.
14. REPLACEMENT OF WARRANTS. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
any Warrant and, in the case of any such loss, theft or destruction, upon
delivery of an indemnity agreement reasonably satisfactory in form and amount
to the Company or, in the case of any such mutilation, upon surrender and
cancellation of such Warrant, the Company at its expense will execute and
deliver, in lieu thereof, a new Warrant of like tenor.
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15. WARRANT AGENT. The Company may, by written notice to each Holder
of a Warrant, appoint an agent having an office in New York, New York, for
the purpose of issuing Common Stock (or Other Securities) upon the exercise
of the Warrants pursuant to section 3, exchanging Warrants pursuant to
section 13, and replacing Warrants pursuant to section 14, or any of the
foregoing, and thereafter any such issuance, exchange or replacement, as the
case may be, shall be made at such office by such agent.
16. REMEDIES. The Company stipulates that the remedies at law of the
Holder of this Warrant in the event of any default or threatened default by
the Company in the performance of or compliance with any of the terms of this
Warrant are not and will not be adequate, and that such terms may be
specifically enforced by a decree for the specific performance of any
agreement contained herein or by an injunction against a violation of any of
the terms hereof or otherwise.
17. NEGOTIABILITY, ETC. Subject to Section 2 above, this Warrant is
issued upon the following terms, to all of which each Holder or owner hereof
by the taking hereof consents and agrees:
(a) subject to the provisions hereof, title to this Warrant may be
transferred by endorsement (by the Holder hereof executing the form of
assignment at the end hereof) and delivery in the same manner as in the
case of a negotiable instrument transferable by endorsement and delivery;
(b) subject to the foregoing, any person in possession of this
Warrant properly endorsed is authorized to represent himself as absolute
owner hereof and is empowered to transfer absolute title hereto by
endorsement and delivery hereof to a bona fide purchaser hereof for value;
each prior taker or owner waives and renounces all of his equities or
rights in this Warrant in favor of each such bona fide purchaser and each
such bona fide purchaser shall acquire absolute title hereto and to all
rights represented hereby; and
(c) until this Warrant is transferred on the books of the Company,
the Company may treat the registered Holder hereof as the absolute owner
hereof for all purposes, notwithstanding any notice to the contrary.
18. NOTICES, ETC. 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, at such address as may have
been furnished to the Company in writing by such Holder, or, until an address
is so furnished, to and at the address of the last Holder of this Warrant who
has so furnished an address to the Company.
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19. MISCELLANEOUS. This Warrant and any term hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by
the party against which enforcement of such change, waiver, discharge or
termination is sought. This Warrant is being delivered in the State of New
York and shall be construed and enforced in accordance with and governed by
the laws of such State. The headings in this Warrant are for purposes of
reference only, and shall not limit or otherwise affect any of the terms
hereof.
20. EXTENDED EXPIRATION.
The right to exercise this Warrant shall expire at 5:00 P.M., New
York City time, on the Expiration Date, provided, however, that if the
Holders of Warrants issued hereunder have, in accordance with the terms
thereof, requested a registration statement pursuant to the Registration
Rights Agreement 90 days or more prior to the Expiration Date and such
registration statement has not become effective prior to the Expiration Date
then the right to exercise this Warrant shall be extended and shall expire 30
days after the effective date of such registration statement.
21. ASSIGNABILITY. Subject to Section 2 hereof, this Warrant is fully
assignable at any time.
Dated: July 29, 1999
ISONICS CORPORATION
By:
-----------------------------
James E. Alexander, President
[Corporate Seal]
Attest:
-------------------------------
Brantley J. Halstead, Secretary
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FORM OF SUBSCRIPTION
(To be signed only upon exercise of Warrant)
To: ISONICS CORPORATION
The undersigned, the Holder of the within Warrant, hereby irrevocably
elects to exercise the purchase right represented by such Warrant for, and to
purchase thereunder, shares of Common Stock of Isonics Corporation, and
herewith makes payment of $ * therefor, and requests that the
certificates for such shares be issued in the name of, and delivered to,
_____________ , whose address is ___________________________ .
Dated:
(Signature must conform in all respects
to name of Holder as specified on the
face of the Warrant)
(Address)
* Insert here the number of shares called for on the face of the Warrant (or,
in the case of a partial exercise, the portion thereof as to which the
Warrant is being exercised), in either case without making any adjustment
for additional Common Stock or any other stock or other securities or
property or cash which, pursuant to the adjustment provisions of the
Warrant, may be deliverable upon exercise.
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FORM OF ASSIGNMENT
(To be signed only upon transfer of Warrant)
For value received, the undersigned hereby sells, assigns and transfers
unto _________________________ the right represented by the within Warrant to
purchase _________ of Common Stock of Isonics Corporation to which the within
Warrant relates, and appoints ______________________________ Attorney to
transfer such right on the books of Isonics Corporation with full power of
substitution in the premises. The Warrant being transferred hereby is one of
the Warrants issued by Isonics Corporation as of July 29, 1999 to purchase an
aggregate of up to 2,330,000 shares of Common Stock.
Dated:
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(Signature must conform in all respects
to name of Holder as specified on the
face of the Warrant)
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(Address)
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Signature guaranteed by a Bank
or Trust Company having its
principal office in New York City
or by a Member Firm of the New
York or American Stock Exchange
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