EXHIBIT 99.2
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SERIES B COMMON SHARE PURCHASE WARRANT
To Purchase __________ Common Shares of
VASOGEN INC.
Warrant No: ________________
THIS SERIES B 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 May , 2007 (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 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.$ 0.53 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
makers for such security as reported in the "pink sheets" by Pink
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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 to such Holder the number of Common Shares then
outstanding. In any case, the number of outstanding Common Shares
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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.
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
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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 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.
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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 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
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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.
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
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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.
b) NEW WARRANTS. This Warrant may be divided or
combined with other Warrants upon presentation hereof at the
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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 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
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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.
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.
10
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.
