Exhibit 10.4
THIS WARRANT AND THE SHARES OF
COMMON STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
STATE SECURITIES LAWS. THIS WARRANT AND THE COMMON STOCK
ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT AS TO THIS WARRANT UNDER SAID ACT
AND ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL
REASONABLY SATISFACTORY TO IMPLANT SCIENCES CORPORATION THAT SUCH
REGISTRATION IS NOT REQUIRED.
Right to Purchase up to 50,000 Shares of Common
Stock of
IMPLANT SCIENCES CORPORATION
(subject to adjustment as
provided herein)
COMMON STOCK PURCHASE
WARRANT
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No.
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Issue Date: As of September 30,
2005
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IMPLANT SCIENCES CORPORATION, a
corporation organized under the laws of the Commonwealth of
Massachusetts (the “Company”), hereby certifies that,
for value received, LAURUS MASTER FUND, LTD., or assigns (the
“Holder”), is entitled, subject to the terms set forth
below, to purchase from the Company (as defined herein) from and
after the Issue Date of this Warrant and at any time or from time
to time before 5:00 p.m., New York time, through the close of
business September 30, 2010 (the “Expiration
Date”), up to Fifty Thousand (50,000) fully paid and
nonassessable shares of Common Stock (as hereinafter defined),
$0.10 par value per share, at the applicable Exercise Price per
share (as defined below). The number and character of such
shares of Common Stock and the applicable Exercise Price per share
are subject to adjustment as provided herein.
As used herein the following terms,
unless the context otherwise requires, have the following
respective meanings:
(a)
The term “Company” shall include IMPLANT SCIENCES
CORPORATION and any corporation which shall succeed, or assume the
obligations of, IMPLANT SCIENCES CORPORATION hereunder.
(b)
The term “Common Stock” includes (i) the
Company’s Common Stock, par value $0.10 per share; and
(ii) any other securities into which or for which any of the
securities described in the preceding clause (i) may be
converted or exchanged pursuant to a plan of recapitalization,
reorganization, merger, sale of assets or otherwise.
(c)
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 holder of the Warrant at
any time shall be entitled to receive, or shall have received, on
the exercise of the Warrant, 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 4 or
otherwise.
(i)
The “Exercise Price” applicable under this Warrant
shall be $10.20.
1.
Exercise of Warrant .
1.1.
Number of Shares Issuable upon Exercise . From and
after the date hereof through and including the Expiration Date,
the Holder shall be entitled to receive, upon exercise of this
Warrant in whole or in part, by delivery of an original or fax copy
of an exercise notice in the form attached hereto as Exhibit A
(the “Exercise Notice”), shares of Common Stock of the
Company, subject to adjustment pursuant to
Section 4.
1.2.
Company Acknowledgment . The Company will, at the time
of the exercise of this Warrant, upon the request of the holder
hereof acknowledge in writing its continuing obligation to afford
to such holder any rights to which such holder shall continue to be
entitled after such exercise in accordance with the provisions of
this Warrant. If the holder shall fail to make any such
request, such failure shall not affect the continuing obligation of
the Company to afford to such holder any such rights.
1.3.
Trustee for Warrant Holders . In the event that a bank
or trust company shall have been appointed as trustee for the
holders of this Warrant pursuant to Subsection 3.2, such bank
or trust company shall have all the powers and duties of a warrant
agent (as hereinafter described) and shall accept, in its own name
for the account of the Company or such successor person as may be
entitled thereto, all amounts otherwise payable to the Company or
such successor, as the case may be, on exercise of this Warrant
pursuant to this Section 1.
2.
Procedure for Exercise .
2.1.
Delivery of Stock Certificates, Etc., on Exercise .
The Company agrees that the shares of Common Stock purchased upon
exercise of this Warrant shall be deemed to be issued to the Holder
as the record owner of such shares as of the close of business on
the date on which this Warrant shall have been surrendered and
payment made for such shares in accordance herewith. As soon
as practicable after the exercise of this Warrant in full or in
part, and in any event within three (3) business days
thereafter, the Company at its 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, or as such Holder (upon payment by
such Holder of any applicable transfer taxes) may direct in
compliance with applicable securities laws, a certificate or
certificates for the number of duly and validly issued, fully paid
and nonassessable shares of Common Stock (or Other Securities) to
which such Holder shall be entitled on such exercise, pursuant to
Section 1 or otherwise.
2.2.
Exercise .
(a)
Payment may be made in cash or by certified or official bank check
payable to the order of the Company equal to the applicable
aggregate Exercise Price, for the number of Common Shares specified
in such Exercise Notice (as such exercise number shall be adjusted
to reflect any adjustment in the total number of shares
of
2
Common Stock
issuable to the Holder per the terms of this Warrant) and the
Holder shall thereupon be entitled to receive the number of duly
authorized, validly issued, fully-paid and non-assessable shares of
Common Stock (or Other Securities) determined as provided
herein.
3.
Effect of Reorganization, Etc.; Adjustment of Exercise Price
.
3.1.
Reorganization, Consolidation, Merger, Etc . In case
at any time or from time to time, the Company 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 contemplating the dissolution of the Company, then, in
each such case, as a condition to the consummation of such a
transaction, proper and adequate provision shall be made by the
Company whereby the Holder, on the exercise hereof as provided in
Section 1 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 receive, in lieu of the
Common Stock (or Other Securities) issuable on 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
Section 4.
3.2.
Dissolution . In the event of any dissolution of the
Company following the transfer of all or substantially all of its
properties or assets, the Company, concurrently with any
distributions made to holders of its Common Stock, shall at its
expense deliver or cause to be delivered to the Holder the stock
and other securities and property (including cash, where
applicable) receivable by the Holder pursuant to Section 3.1,
or, if the Holder shall so instruct the Company, to a bank or trust
company specified by the Holder and having its principal office in
New York, NY as trustee for the Holder (the
“Trustee”).
3.3.
Continuation of Terms . Upon any reorganization,
consolidation, merger or transfer (and any dissolution following
any transfer) referred to in this Section 3, this Warrant
shall continue in full force and effect and the terms hereof shall
be applicable to the shares of stock and other securities and
property receivable on the exercise of this Warrant after the
consummation of such reorganiza
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