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PURCHASE WARRANT

Warrant Agreement

PURCHASE WARRANT     
 | Document Parties: ICOP DIGITAL, INC | PAULSON INVESTMENT COMPANY, INC You are currently viewing:
This Warrant Agreement involves

ICOP DIGITAL, INC | PAULSON INVESTMENT COMPANY, INC

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Title: PURCHASE WARRANT
Governing Law: Oregon     Date: 1/4/2006

PURCHASE WARRANT     
, Parties: icop digital  inc , paulson investment company  inc
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Exhibit 4.4

 

THIS WARRANT HAS NOT BEEN REGISTERED

UNDER THE SECURITIES ACT OF 1933

AND IS NOT TRANSFERABLE

EXCEPT AS PROVIDED HEREIN

 

ICOP Digital, Inc.

 

PURCHASE WARRANT

 

Issued to:

 

PAULSON INVESTMENT COMPANY, INC.

 

Exercisable to Purchase

 

65,000 SHARES OF COMMON STOCK

 

AND

 

22,750 WARRANTS,

EACH TO PURCHASE ONE SHARE OF COMMON STOCK

 

of

 

ICOP DIGITAL, INC.

 

Void after July 8, 2010


This is to certify that, for value received and subject to the terms and conditions set forth below, the Warrantholder (hereinafter defined) is entitled to purchase, and the Company promises and agrees to sell and issue to the Warrantholder on or before July 8, 2010, up to 65,000 shares of Common Stock and 22,750 Underlying Warrants at the Exercise Price.

 

This Purchase Warrant Certificate is issued subject to the following terms and conditions:

 

1. DEFINITIONS OF CERTAIN TERMS. Except as may be otherwise clearly required by the context, the following terms have the following meanings:

 

(a) “Act” means the Securities Act of 1933, as amended.

 

(b) “Cashless Exercise” means an exercise of the Purchase Warrant in which, in lieu of payment of the Exercise Price, the Holder elects to receive a lesser number of Securities such that the value of the Securities that such Holder would otherwise have been entitled to receive but has agreed not to receive, as determined by the closing prices of such Securities on the date of exercise or, if such date is not a trading day, on the next prior trading day, is equal to the Exercise Price with respect to such exercise. A Holder may only elect a Cashless Exercise if Securities issuable by the Company on such exercise are publicly traded securities.

 

(c) “Closing Date” means the date on which the Offering is closed.

 

(d) “Commission” means the Securities and Exchange Commission.

 

(e) “Common Stock” means the common stock, no par value, of the Company.

 

(f) “Company” means ICOP Digital, Inc., a Colorado corporation.

 

(g) “Company’s Expenses” means any and all expenses payable by the Company or the Warrantholder in connection with an offering described in Section 6 hereof, except Warrantholder’s Expenses.

 

(h) “Exercise Price” means the price at which the Warrantholder may purchase one share of Common Stock and 0.35 Underlying Warrants. The Exercise Price initially is $5.92.

 

(i) “Offering” means the private offering of Common Stock and warrants by the Company made pursuant to a Securities Purchase Agreement dated as of December 1, 2005.

 

(j) “Rules and Regulations” means the rules and regulations of the Commission adopted under the Act.

 

(k) “Securities” means the securities obtained or obtainable upon exercise of the Purchase Warrant or securities obtained or obtainable upon exercise, exchange, or conversion of such securities.

 

Purchase Warrant – December 8, 2005


(l) “Public Warrants” means the publicly-traded warrants subject to a Warrant Agreement, dated as of July 13, 2005, by and between the Company and ComputerShare Trust Company, Inc.

 

(m) “Purchase Warrant Certificate” means this certificate evidencing the Purchase Warrant.

 

(n) “Warrantholder” means a record holder of the Purchase Warrant or Securities. The initial Warrantholder is Paulson Investment Company, Inc.

 

(o) “Warrantholder’s Expenses” means the sum of (i) the aggregate amount of cash payments made to an underwriter, underwriting syndicate, or agent in connection with an offering described in Section 6 hereof multiplied by a fraction the numerator of which is the aggregate sales price of the Securities sold by such underwriter, underwriting syndicate, or agent in such offering and the denominator of which is the aggregate sales price of all of the securities sold by such underwriter, underwriting syndicate, or agent in such offering and (ii) all out-of-pocket expenses of the Warrantholder, except for the fees and disbursements of one firm retained as legal counsel for the Warrantholder that will be paid by the Company.

 

(p) “Purchase Warrant” means the warrant evidenced by this certificate, any similar certificate issued in connection with the Offering, or any certificate obtained upon transfer or partial exercise of the Purchase Warrant evidenced by any such certificate.

 

(q) “Underlying Warrant” means a warrant to purchase one share of Common Stock at a price of $6.19 per share, and identical in form to the warrants sold in the Offering.

 

2. EXERCISE OF PURCHASE WARRANT. All or any part of the Purchase Warrant represented by this Purchase Warrant Certificate may be exercised until 5:00 p.m. Pacific Time on July 8, 2010 by surrendering this Purchase Warrant Certificate, together with appropriate instructions, duly executed by the Warrantholder or by its duly authorized attorney, at the office of the Company at ICOP Digital, Inc., 16801 W. 116 th Street, Lenexa, Kansas 66219, Attention: President; or at such other office or agency as the Company may designate. The date on which such instructions are received by the Company shall be the date of exercise. If the Holder has elected a Cashless Exercise, such instructions shall so state. Upon receipt of notice of exercise, the Company shall immediately instruct its transfer agent to prepare certificates for the Securities to be received by the Warrantholder upon completion of the Purchase Warrant exercise. When such certificates are prepared, the Company shall notify the Warrantholder and deliver such certificates to the Warrantholder or as per the Warrantholder’s instructions immediately upon payment in full by the Warrantholder, in lawful money of the United States, of the Exercise Price payable with respect to the Securities being purchased, if any. If the Warrantholder shall represent and warrant that all applicable registration and prospectus delivery requirements for their sale have been complied with upon sale of the Securities received upon exercise of the Purchase Warrant, such certificates shall not bear a legend with respect to the Securities Act of 1933, as amended.

 

If fewer than all the Securities purchasable under the Purchase Warrant are purchased, the Company will, upon such partial exercise, execute and deliver to the Warrantholder a new

 

 

 

 

 

 

Purchase Warrant – December 8, 2005

 

2

 

 


Purchase Warrant Certificate (dated the date hereof), in form and tenor similar to this Purchase Warrant Certificate, evidencing that portion of the Purchase Warrant not exercised. The Securities to be obtained on exercise of the Purchase Warrant will be deemed to have been issued, and any person exercising the Warrants will be deemed to have become a holder of record of those Securities, as of the date of the payment of the Exercise Price.

 

3. ADJUSTMENTS IN CERTAIN EVENTS. The number, class, and price of Securities for which this Purchase Warrant Certificate may be exercised are subject to adjustment from time to time upon the happening of certain events as follows:

 

(a) If the outstanding shares of the Company’s Common Stock are divided into a greater number of shares or a dividend in stock is paid on the Common Stock, the number of shares of Common Stock for which the Purchase Warrant is then exercisable will be proportionately increased and the Exercise Price will be proportionately reduced; and, conversely, if the outstanding shares of Common Stock are combined into a smaller number of shares of Common Stock, the number of shares of Common Stock for which the Purchase Warrant is then exercisable will be proportionately reduced and the Exercise Price will be proportionately increased. The increases and reductions provided for in this Section 3(a) will be made with the intent and, as nearly as practicable, the effect that neither the percentage of the total equity of the Company obtainable on exercise of the Purchase Warrant nor the price payable for such percentage upon such exercise will be affected by any event described in this Section 3(a).

 

(b) In case of any change in the Common Stock through merger, consolidation, reclassification, reorganization, partial or complete liquidation, purchase of substantially all the assets of the Company, or other change in the capital structure of the Company, other than changes in par value, then, as a condition of such change, lawful and adequate provision will be made so that the holder of this Purchase Warrant Certificate will have the right thereafter to receive upon the exercise of the Purchase Warrant the kind and amount of shares of stock or other securities or property to which he would have been entitled if, immediately prior to such event, he had held the number of shares of Common Stock obtainable upon the exercise of the Purchase Warrant. In any such case, appropriate adjustment will be made in the application of the provisions set forth herein with respect to the rights and interest thereafter of the Warrantholder, to the end that the provisions set forth herein will thereafter be applicable, as nearly as reasonably may be, in relation to any shares of stock or other property thereafter deliverable upon the exercise of the Purchase Warrant. The Company will not permit any change in its capital structure to occur unless the issuer of the shares of stock or other securities to be received by the holder of this Purchase Warrant Certificate, if not the Company, agrees to be bound by and comply with the


 
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