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UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date
of Report (Date of earliest event reported): January 10, 2023
ORGENESIS
INC.
(Exact
name of registrant as specified in its charter)
| Nevada
|
|
001-38416
|
|
98-0583166
|
| (State
or other jurisdiction |
|
(Commission File |
|
(IRS
Employer |
| of
incorporation) |
|
Number) |
|
Identification
No.) |
20271
Goldenrod Lane, Germantown, MD 20876
(Address
of principal executive offices) (Zip Code)
Registrant’s
telephone number, including area code: (480) 659-6404
Not
Applicable
(Former
name or former address, if changed since last report.)
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under
any of the following provisions:
| ☐ |
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| |
|
| ☐ |
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a -12) |
| |
|
| ☐ |
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d -2(b)) |
| |
|
| ☐ |
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e -4(c)) |
Securities
registered pursuant to Section 12(b) of the Act:
| Title
of each class |
|
Trading
Symbol(s) |
|
Name
of each exchange on which registered |
| Common
Stock |
|
ORGS |
|
The
Nasdaq Capital Market |
Indicate
by check mark whether the registrant is an emerging growth company as defined in in Rule 405 of the Securities Act of 1933
(§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b -2 of this chapter).
Emerging
growth company ☐
If
an emerging growth company, indicate by checkmark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item
1.01 Entry into a Material Definitive Agreement.
Convertible
Loan Agreements
On
January 10, 2023 (the “Effective Date”), Orgenesis Inc. (referred to herein as “us,” “our,” or the
“Company”) entered into the following agreements: (i) a convertible loan agreement (the “NewTech Convertible Loan Agreement”)
with NewTech Investment Holdings, LLC (the “NewTech Lender”), pursuant to which the NewTech Lender loaned the Company $4,000,000
(the “NewTech Loan Amount”), and (ii) a convertible loan agreement (the “Malik Convertible Loan Agreement”, together
with the NewTech Convertible Loan Agreement, the “Convertible Loan Agreements”) with Ariel Malik (the “Malik Lender”,
together with the NewTech Lender, the “Lenders”), pursuant to which the Malik Lender loaned the Company $1,000,000 (the “Malik
Loan Amount”, together with the NewTech Loan Amount, the “Loan Amount”).
The
terms of the NewTech Convertible Loan Agreement and the Malik Loan Agreement are identical. Interest is calculated at 8% per annum (based
on a 365-day year); provided, that if an Event of Default (as defined in the Convertible Loan Agreements) has occurred and is continuing,
the Outstanding Amount (as defined herein) will be calculated at 15.0% per annum. The Loan Amount and all accrued but unpaid interest
thereon (collectively, the “Outstanding Amount”) shall either (i) be repaid in cash or (ii) convert to shares of common stock,
par value $0.0001 per share (“Common Stock”), of the Company on the third anniversary of the Effective Date (the “Maturity
Date”). The Maturity Date may be extended by the Lender upon the written consent of the Lender. The Outstanding Amount may be prepaid
by the Company in whole or in part at any time with the prior approval of the Lender.
At
any time prior to or on the Maturity Date, any Lender may provide us with written notice to convert all or part of the Outstanding Amount
into shares of our Common Stock equal to the quotient obtained by dividing (x) the Outstanding Amount by (y) a price equal to $2.464
per share (subject to adjustment for certain capital events, such as stock splits) (the “Conversion Price”).
The
Convertible Loan Agreements contain customary affirmative and negative covenants, including a minimum share reserve, transactions with
affiliates, and restrictions on the incurrence of additional debt. Each Lender’s obligation to fund its respective Loan Amount
is subject to customary closing conditions and deliverables.
Under
the terms of the Convertible Loan Agreements, the Company will use the proceeds from the Loan Amount to (i) redeem the loan amount from
the previously disclosed Convertible Loan Agreement, dated as of May 19, 2022 between Orgenesis and Ricky Steven Neumann, as amended
by the previously disclosed certain Convertible Loan Extension Agreement, dated as of October 23, 2022, by and between Orgenesis and
Ricky Steven Neumann, and (ii) for general corporate purposes. The use of proceeds from any Additional Loan Amount (as defined in the
Convertible Loan Agreements) will be to redeem existing indebtedness; provided, that $3,000,000 of the Additional Loan Amount may be
used for general corporate purposes.
In
the event the closing price of our Common Stock on the Nasdaq Capital Market (or other national stock exchange or market on which our
Common Stock is then listed or quoted) equals or exceeds $15.00 per share (which amount may be adjusted for certain capital events, such
as stock splits) for ten (10) consecutive trading days, then the Lender must convert any and all accrued but unpaid interest into shares
of our Common Stock at the applicable Conversion Price.
In
connection with such loan, the Company agreed to issue the NewTech Lender warrants representing the right to purchase 405,844 shares
of our Common Stock, at an exercise price of $2.50 per share and the Malik Lender warrants representing the right to purchase 101,461
shares of our Common Stock, at an exercise price of $2.50 per share. Such Warrants will be exercisable at any time beginning six months
and one day after closing and ending 36 months after the closing date.
The
Warrants issued to the Lenders in connection with the Convertible Loan Agreements are subject to mandatory exercise wherein the Company
shall have the right to require the Lenders to exercise all or any portion of the Warrants that are still unexercised for a cash exercise
when the closing price of our Common Stock on the Nasdaq Capital Market equals or exceeds $15.00 per share for ten (10) consecutive trading
days.
The
convertible loans and the shares of Common Stock issuable upon conversion of the convertible loans, the Warrants and the shares of Common
Stock issuable upon exercise of such Warrants, have not been registered under the Securities Act of 1933, as amended (the “Securities
Act”) and were issued and sold in reliance upon the exemption from registration contained in Section 4(a)(2) of the Securities
Act promulgated thereunder. The convertible loan, the Warrant and the shares of Common Stock issuable upon conversion of the convertible
loan and upon exercise of the Warrant may not be offered or sold in the absence of an effective registration statement or exemption from
the registration requirements under the Securities Act.
The
foregoing summaries of the NewTech Convertible Loan Agreement and form of Warrant do not purport to be complete and are subject to, and
qualified in their entirety by, the full text of such documents attached as Exhibits 4.1 and 10.1, respectively, to this Current Report
on Form 8-K, which are incorporated herein by reference.
The
foregoing summaries of the Malik Convertible Loan Agreement and form of Warrant do not purport to be complete and are subject to, and
qualified in their entirety by, the full text of such documents attached as Exhibits 4.1 and 10.2, respectively, to this Current Report
on Form 8-K, which are incorporated herein by reference.
Item
2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The
information required by this Item 2.03 is included under Item 1.01 of this Current Report on Form 8-K.
Item
3.02. Unregistered Sales of Equity Securities.
The
information required by this Item 3.02 is included under Item 1.01 of this Current Report on Form 8-K.
Item
9.01. Financial Statements and Exhibits.
The
exhibit listed in the following Exhibit Index is filed as part of this Current Report on Form 8-K.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
| |
ORGENESIS
INC. |
| |
|
| Date:
January 13, 2023 |
By: |
/s/
Neil Reithinger |
| |
|
Neil
Reithinger |
| |
|
Chief
Financial Officer, Treasurer and Secretary |
Exhibit
4.1
THIS
WARRANT CERTIFICATE AND THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT
REQUIRED UNDER SUCH ACT OR UNLESS SOLD IN ACCORDANCE WITH RULE 144 UNDER SUCH ACT.
| WARRANT
CERTIFICATE NO. 2023-[●] |
|
NUMBER
OF WARRANTS: [●] |
| DATE
OF ISSUANCE: [●], 2023 |
|
|
| INITIAL
EXERCISE DATE: [●], 2023 |
|
(subject
to adjustment hereunder) |
| EXPIRATION
DATE: [●], 2026 |
|
|
WARRANTS
TO PURCHASE SHARES
OF
COMMON STOCK OF
ORGENESIS
INC.
This
Warrant Certificate (this “Warrant Certificate”) represents [●] warrants to purchase shares of Common Stock
(as defined below) and is issued to [●], or its registered assigns (including any successors or assigns, the “Holder”),
pursuant to that certain Convertible Loan Agreement, dated as of January 10, 2023 (the “Loan Agreement”), among Orgenesis
Inc., a Nevada corporation (the “Company”), the Holder and [●].
1.
EXERCISE OF WARRANT.
(a)
Number and Exercise Price of Warrant Shares; Expiration Date. Subject to the terms and conditions set forth herein, the Holder
is entitled to purchase from the Company up to [●] shares of the Company’s Common Stock, $0.0001 par value per share (the
“Common Stock”) (as adjusted from time to time pursuant to the provisions of this Warrant Certificate) (the “Warrant
Shares”), at a purchase price of $2.50 per share (as adjusted from time to time pursuant to the provisions of this Warrant,
the “Exercise Price”), at any time on or after [●] (the “Initial Exercise Date”) and on or
before 5:00 p.m. New York City time on [●] (the “Expiration Date”) (subject to earlier termination of this Warrant
Certificate as set forth herein).
(b)
Method of Exercise. While this Warrant Certificate remains outstanding and exercisable in accordance with Section 1(a) above,
the Holder may exercise any or all of the Warrants represented by this Warrant Certificate by surrendering this Warrant Certificate at
the principal office of the Company and paying the Exercise Price of the Warrants to be exercised hereunder by either:
(1)
wire transfer to the Company or cashier’s check drawn on a United States bank made payable to the order of the Company, or
(2)
if there is no effective registration statement registering, or no current prospectus available for, the resale of the Warrant Shares
by the Purchaser, exercising of the right to credit the Exercise Price against the Fair Market Value of the Warrant Shares (as defined
below) at the time of exercise (the “Net Exercise”) pursuant to Section 1(c).
(c)
Net Exercise. If the Company shall receive written notice from the Holder at the time of exercise of Warrants hereunder that the
Holder elects to Net Exercise such Warrants, the Company shall deliver to such Holder (without payment by the Holder of any exercise
price in cash) that number of Warrant Shares computed using the following formula:
| Where |
|
|
| |
|
|
| |
X
= |
The
number of Warrant Shares to be issued to the Holder. |
| |
|
|
| |
Y
= |
The
number of Warrant Shares purchasable based on the number of Warrants being exercised. |
| |
|
|
| |
A
= |
The
Fair Market Value of one (1) share of Common Stock (at the date of such calculation). |
| |
|
|
| |
B
= |
The
Exercise Price (as adjusted to the date of such calculations). |
The
“Fair Market Value” of one share of Common Stock shall mean (x) the closing price of the Common Stock on the business
day prior to the date of exercise on The Nasdaq Capital Market as reported by Bloomberg Financial Markets (or a comparable reporting
service of national reputation selected by the Company and reasonably acceptable to the holder if Bloomberg Financial Markets is not
then reporting sales prices of the Common Stock) (collectively, “Bloomberg”) or (y) or if the foregoing does not apply,
the last sales price of the Common Stock in the over-the-counter market on the pink sheets or bulletin board for such security as reported
by Bloomberg, and, if there are no sales, the last reported bid price of the Common Stock as reported by Bloomberg or, if the Fair Market
Value cannot be calculated as of such date on either of the foregoing bases, the price determined in good faith by the board of directors
of the Company.
2.
CERTAIN ADJUSTMENTS.
(a)
Adjustment of Number of Warrant Shares and Exercise Price. The number of shares of Common Stock issuable upon the exercise of
each Warrant represented by this Warrant Certificate (the “Warrant Number”) is initially one. The Warrant Number and kind
of Warrant Shares purchasable upon exercise of each Warrant and the Exercise Price shall be subject to adjustment from time to time as
follows:
(1)
Subdivisions, Combinations and Other Issuances. If the Company shall at any time after the Date of Issuance but prior to the Expiration
Date subdivide its shares of capital stock of the same class as the Warrant Shares, by split-up or otherwise, or combine such shares
of capital stock, or issue additional shares of capital stock as a dividend with respect to any shares of such capital stock, the Warrant
Number shall forthwith be proportionately increased in the case of a subdivision or stock dividend, or proportionately decreased in the
case of a combination. Appropriate adjustments shall also be made to the Exercise Price payable per share, but the aggregate Exercise
Price payable for the total number of Warrant Shares purchasable under all Warrants initially represented by this Warrant Certificate
(as adjusted) shall remain the same. Any adjustment under this Section 2(a)(1) shall become effective at the close of business on the
date the subdivision or combination becomes effective, or as of the record date of such dividend, or in the event that no record date
is fixed, upon the making of such dividend.
(2)
Adjustments for Other Dividends and Distributions. In the event the Company at any time or from time to time after the Date of
Issuance shall make or issue, or fix a record date for the determination of holders of Common Stock entitled to receive, a dividend or
other distribution payable in securities of the Company (other than shares of Common Stock) or in cash or other property, then and in
each such event provision shall be made so that the Holder shall receive upon exercise hereof, in addition to the number of shares of
Common Stock issuable hereunder, the kind and amount of securities of the Company, cash or other property that the Holder would have
been entitled to receive had all Warrants represented by this Warrant Certificate been exercised on the date of such event and had the
Holder thereafter, during the period from the date of such event to and including the Exercise Date, retained any such securities receivable
during such period, giving application to all adjustments called for during such period under this Section 2 with respect to the rights
of the Holder.
(3)
Reorganizations or Mergers. In case of any reclassification, capital reorganization or change in the capital stock of the
Company (other than as a result of a subdivision, combination or stock dividend provided for in Section 2(a)(1) above) that occurs
after the Date of Issuance, then, as a condition of such reclassification, reorganization or change, lawful provision shall be made,
and duly executed documents evidencing the same from the Company or its successor shall be delivered to the Holder, so that the Holder
shall thereafter have the right at any time prior to the expiration of the Warrants represented by this Warrant Certificate to purchase,
at a total price equal to that payable upon the exercise of the Warrants represented by this Warrant Certificate, the kind and amount
of shares of stock and/or other securities or property (including, if applicable, cash) receivable in connection with such reclassification,
reorganization or change by a holder of the same number and type of securities as were purchasable as Warrant Shares by the Holder immediately
prior to such reclassification, reorganization or change. In any such case appropriate provisions shall be made with respect to the rights
and interest of the Holder so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other
securities or property deliverable upon exercise hereof, and appropriate adjustments shall be made to the Exercise Price payable hereunder,
provided the aggregate Exercise Price shall remain the same (and the Warrants shall be exclusively exercisable for such shares of stock
and/or other securities or property from and after the consummation of such reclassification or other change in the capital stock of
the Company).
(b)
Notice to Holder. If, while any Warrant is outstanding, the Company (i) declares a dividend or any other distribution of cash,
securities or other property in respect of its Common Stock, including, without limitation, any granting of rights or warrants to subscribe
for or purchase any capital stock of the Company or any subsidiary, (ii) authorizes or approves, enters into any agreement contemplating
or solicits stockholder approval for any Change of Control or (iii) authorizes the voluntary dissolution, liquidation or winding up of
the affairs of the Company, then the Company shall deliver to a holder a notice of such transaction at least 15 business days prior to
the applicable record or effective date on which a person would need to hold Common Stock in order to participate in or vote with respect
to such transaction; provided, however, that the failure to deliver such notice or any defect therein shall not affect the validity of
the corporate action required to be described in such notice.
(c)
Calculations. All calculations under this Section 2 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 2, the number of shares of Common Stock deemed to be issued and outstanding as
of a given date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.
(d)
Treatment of Warrant upon a Change of Control.
(1)
In the event of a Change of Control in which the consideration to be received by the Company’s stockholders consists solely of
cash, solely of Marketable Securities (as defined below) or a combination of cash and Marketable Securities (a “Cash/Public
Change of Control”), if any Warrant is outstanding upon the consummation of such Cash/Public Change of Control then (i) if
the Fair Market Value of one share of Common Stock (as determined in accordance with Section 1(c)) is greater than the then applicable
Exercise Price, the Warrants may be exercised at the election of the Holder on a net exercise issue basis pursuant to Section 1(c)
as of immediately prior to such Cash/Public Change of Control and (ii) if the Fair Market Value of one share of Common Stock (as
determined in accordance with Section 1(c)) is less than or equal to the then applicable Exercise Price, the Warrants will expire
immediately prior to the consummation of such Change of Control; provided that during the term of the Warrants, each of the Company’s
outstanding warrants will be treated in the same manner as above subject to the terms of such outstanding warrants existing on the Date
of Issuance.
(2)
If, at any time while any of the Warrants is outstanding, the Company consummates a Change of Control that is not a Cash/Public Change
of Control, then a Holder shall have the right thereafter to receive, upon exercise of a Warrant, the same amount and kind of securities,
cash or property as it would have been entitled to receive upon the occurrence of such Change of Control if it had been, immediately
prior to such Change of Control, a holder of the number of Warrant Shares then issuable upon exercise in full of the Warrant (the “Alternate
Consideration”). The Company shall not effect any such Change of Control unless prior to or simultaneously with the consummation
thereof, any successor to the Company, surviving entity or the corporation purchasing or otherwise acquiring such assets or other appropriate
corporation or entity shall assume the obligation to deliver to the Holder, such Alternate Consideration as, in accordance with the foregoing
provisions, the Holder may be entitled to purchase, and the other obligations under this Warrant Certificate.
(3)
As used in this Warrant Certificate, a “Change of Control” shall mean (i) a merger or consolidation of the Company
with another corporation (other than a merger effected exclusively for the purpose of changing the domicile of the Company), (ii) the
sale, assignment, transfer, conveyance or other disposal of all or substantially all of the properties or assets or all or a majority
of the outstanding voting shares of capital stock of the Company, (iii) a purchase, tender or exchange offer accepted by the holders
of a majority of the outstanding voting shares of capital stock of the Company, or (iv) a “person” or “group”
(as these terms are used for purposes of Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”)) is or shall become the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly at least a majority of the voting power of the capital stock of the Company.
(4)
As used in this Warrant Certificate, “Marketable Securities” means securities meeting all of the following requirements:
(i) the issuer thereof is then subject to the reporting requirements of Section 13 or Section 15(d) of the Securities Exchange Act, and
is then current in its filing of all required reports and other information under the Securities Act of 1933, as amended (the “Securities
Act”), and the Exchange Act; (ii) the class and series of shares or other security of the issuer that would be received by
the Holder in connection with the Change of Control were the Holder to exercise the Warrants on or prior to the closing thereof is then-traded
or quoted on a nationally recognized securities exchange, inter-dealer quotation system or over-the-counter market, and (iii) following
the closing of such Change of Control, the Holder would not be restricted from publicly re-selling all of the issuer’s shares and/or
other securities that would be received by the Holder in such Change of Control were the Holder to exercise or convert the Warrants in
full on or prior to the closing of such Change of Control, except to the extent that any such restriction (x) arises solely under federal
or state securities laws, rules or regulations, and (y) does not extend beyond six months from the closing of such Change of Control.
3.
NO FRACTIONAL SHARES. No fractional Warrant Shares or
scrip representing fractional shares will be issued upon exercise of any Warrant. In lieu of any fractional shares which would otherwise
be issuable, the Company shall pay cash equal to the product of such fraction multiplied by the Fair Market Value of one Warrant Share.
4.
NO STOCKHOLDER RIGHTS. Until the exercise of
a Warrant, the Holder shall not have, nor exercise, any rights as a stockholder of the Company (including without limitation the right
to notification of stockholder meetings or the right to receive any notice or other communication concerning the business and affairs
of the Company) except as provided in Section 9 below.
5.
RESERVATION OF STOCK. The Company covenants that
during the period the Warrants are exercisable, the Company will reserve from its authorized and unissued Common Stock a sufficient number
of shares of Common Stock (or other securities, if applicable) to provide for the issuance of Warrant Shares (or other securities) upon
the exercise of the Warrants.
6.
MECHANICS OF EXERCISE.
(a)
Delivery of Warrant Shares Upon Exercise. The Warrants may be exercised by the Holder, in whole or in part, by the surrender of
this Warrant Certificate and the Notice of Exercise attached hereto as Exhibit A duly completed and executed on behalf of the
Holder, at the principal office of the Company together with payment in full of the Exercise Price (unless the Holder has elected to
Net Exercise) then in effect with respect to the number of Warrant Shares as to which the Warrant is being exercised. The Warrants shall
be deemed to have been exercised immediately prior to the close of business on the date of surrender for exercise as provided above,
and the person entitled to receive the Warrant Shares issuable upon such exercise shall be treated for all purposes as the holder of
such shares of record as of the close of business on such date. Warrant Shares purchased hereunder shall be transmitted by the Company’s
transfer agent to the Holder by crediting the account of the Holder’s prime broker with The Depository Trust Company through its
Deposit or Withdrawal at Custodian system if the Company is then a participant in such system and either (A) there is an effective registration
statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by the Holder or (B) the shares are eligible
for resale by the Holder without volume or manner-of-sale limitations pursuant to Rule 144, and otherwise by physical delivery to the
address specified by the Holder in the Notice of Exercise by the end of the day on the date that is three trading days from the delivery
to the Company of the Notice of Exercise, surrender of this Warrant Certificate and payment of the aggregate Exercise Price (unless exercised
by means of a cashless exercise pursuant to Section 1(c). 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 such Warrants have been exercised, with payment to the Company of the Exercise Price (or by Net Exercise) and all taxes
required to be paid by the Holder, if any, prior to the issuance of such shares, having been paid. The Company will pay all documentary
stamp taxes and other governmental charges (excluding all foreign, federal or state income, capital gains franchise, property, estate,
inheritance, gift or similar taxes) in connection with the issuance or delivery or the exercise of any Warrant.
(b)
Holder’s Exercise Limitations. The Holder shall not have the right to exercise Warrants, pursuant to Section 1
or otherwise, to the extent that after giving effect to such issuance after exercise as set forth on the applicable Notice of Exercise,
the Holder (together with the Holder’s affiliates, and any other persons acting as a group together with the Holder or any of the
Holder’s affiliates), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes
of the foregoing sentence, the aggregate number of shares of Common Stock beneficially owned by the Holder and its affiliates shall include
the number of shares of Common Stock issuable upon exercise of the outstanding Warrants represented hereby with respect to which such
determination is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (i) exercise of the
remaining, nonexercised portion of the Warrants represented hereby beneficially owned by the Holder or any of its affiliates and (ii)
exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation,
any other convertible notes or convertible preferred stock or warrants) subject to a limitation on conversion or exercise analogous to
the limitation contained herein beneficially owned by the Holder or any of its affiliates. Except as set forth in the preceding sentence,
for purposes of this section, 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 the Holder that the Company is not representing to the Holder that such
calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible for any schedules required to
be filed in accordance therewith. To the extent that the limitation contained in this Section 6(b) applies, the determination
of whether the Warrants are exercisable (in relation to other securities owned by the Holder together with any of its affiliates) and
of which portion of the Warrants are exercisable shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise
shall be deemed to be the Holder’s determination of whether the Warrants are exercisable (in relation to other securities owned
by the Holder together with any of its affiliates) and of which portion of this Warrant is exercisable, in each case subject to the Beneficial
Ownership Limitation, and the Company shall have no obligation to verify or confirm the accuracy of such determination and shall have
no liability for exercise of the Warrants that are not in compliance with the Beneficial Ownership Limitation. 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 6(b), in determining the number of outstanding shares of Common
Stock, the Holder may rely on the number of outstanding shares of Common Stock as reflected in (A) the Company’s most recent periodic
or annual report filed with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent
written notice by the Company or the Company’s transfer agent setting forth the number of shares of Common Stock outstanding. Upon
the written request of the Holder, the Company shall within three trading days confirm in writing to the Holder the number of shares
of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect
to the conversion or exercise of securities of the Company, including the Warrants, by the Holder or its affiliates since the date as
of which such number of outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation” shall
be 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common
Stock issuable upon exercise of the Warrants. Any such increase or decrease will not be effective until the 61st day after such notice
is delivered to the Company. The provisions of this Section 6(b) shall be construed and implemented in a manner otherwise than
in strict conformity with the terms of this Section 6(b) to correct this Section 6(b) (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 Section 6(b) shall apply to a successor
holder of the Warrants.
7.
CERTIFICATE OF ADJUSTMENT. Whenever the Exercise Price
or number or type of securities issuable upon exercise of Warrants is adjusted, as herein provided, the Company shall, at its expense,
promptly deliver to the Holder a certificate of an officer of the Company setting forth the nature of such adjustment and showing in
detail the facts upon which such adjustment is based.
8.
COMPLIANCE WITH SECURITIES LAWS.
(a)
The Holder understands that the Warrants and the Warrant Shares are characterized as “restricted securities” under the federal
securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that under
such laws and applicable regulations the Warrants and the Warrant Shares may be resold without registration under the Securities Act
only in certain limited circumstances. In this connection, the Holder represents that it is familiar with Rule 144 under the Securities
Act, as presently in effect, and understands the resale limitations imposed thereby and by the Securities Act.
(b)
Prior and as a condition to the sale or transfer of the Warrant Shares issuable upon exercise of the Warrants, the Holder shall furnish
to the Company such certificates, representations, agreements and other information as the Company or the Company’s transfer agent
reasonably may require to confirm that such sale or transfer is being made pursuant to an exemption from, or in a transaction not subject
to, the registration requirements of the Securities Act, unless such Warrant Shares are being sold or transferred pursuant to an effective
registration statement.
(c)
The Holder acknowledges that the Company may place a restrictive legend on the Warrant Shares issuable upon exercise of the Warrants
in order to comply with applicable securities laws, unless such Warrant Shares are otherwise freely tradable under Rule 144 of the Securities
Act.
9.
REPLACEMENT OF WARRANTS. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant Certificate and, in the case of any such loss,
theft or destruction of this Warrant Certificate, on delivery of an indemnity agreement reasonably satisfactory in form and amount to
the Company or, in the case of any such mutilation, on surrender and cancellation of such Warrant, the Company at its expense will execute
and deliver, in lieu thereof, a new Warrant Certificate of like tenor.
10.
NO IMPAIRMENT. Except to the extent as may be waived
by the Holder, the Company will not, by amendment of its charter or through a Change of Control, dissolution, sale of assets or any other
voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant Certificate, but will at all
times in good faith assist in the carrying out of all such terms and in the taking of all such action as may be necessary or appropriate
in order to protect the rights of the Holder against impairment.
11.
TRADING DAYS. If the last or appointed day for the taking
of any action or the expiration of any right required or granted herein shall be other than a day on which the Common Stock is traded
on The Nasdaq Capital Market, or, if The Nasdaq Capital Market is not the principal trading market for the Common Stock, then on the
principal securities exchange or securities market on which the Common Stock is then traded, then such action may be taken or such right
may be exercised on the next succeeding day on which the Common Stock is so traded.
12.
TRANSFERS; EXCHANGES. (a) Subject to compliance with
applicable federal and state securities laws and Section8 hereof, this Warrant Certificate may be transferred by the Holder with
respect to any or all of the Warrant Shares purchasable hereunder. For a transfer of this Warrant Certificate as an entirety by the Holder,
upon surrender of this Warrant Certificate to the Company, together with the Notice of Assignment in the form attached hereto as Exhibit
B duly completed and executed on behalf of the Holder, the Company shall issue a new Warrant of the same denomination to the assignee.
For a transfer of this Warrant Certificate with respect to a portion of the Warrant Shares purchasable hereunder, upon surrender of this
Warrant Certificate to the Company, together with the Notice of Assignment in the form attached hereto as Exhibit B duly completed
and executed on behalf of the Holder, the Company shall issue a new Warrant Certificate to the assignee, in such denomination as shall
be requested by the Holder, and shall issue to the Holder a new Warrant Certificate covering the number of shares in respect of which
this Warrant Certificate shall not have been transferred.
(b)
This Warrant Certificate is exchangeable, without expense, at the option of the Holder, upon presentation and surrender hereof to the
Company for other warrants of different denominations entitling the holder thereof to purchase in the aggregate the same number of shares
of Common Stock purchasable hereunder. The Warrants may be divided or combined with other warrants that carry the same rights upon presentation
hereof at the principal office of the Company together with a written notice specifying the denominations in which new warrants are to
be issued to the Holder and signed by the Holder hereof. The term “Warrants” as used herein includes any warrants into which
this Warrant may be divided or exchanged.
13.
MISCELLANEOUS. This Warrant Certificate shall be governed
by and construed in accordance with the internal laws of the State of New York, without the application of principles of conflicts of
laws that would result in any law other than the laws of the State of New York. All notices, requests, consents and other communications
hereunder shall be in writing, shall be sent by confirmed facsimile or electronic mail, or mailed by first-class registered or certified
airmail, or nationally recognized overnight express courier, postage prepaid, and shall be deemed given when so sent in the case of facsimile
or electronic mail transmission, or when so received in the case of mail or courier, and addressed as follows: (a) if to the Company,
at Orgenesis Inc., 20271 Goldenrod Lane, Germantown, Maryland 20876, Attention: Neil Reithinger, CFO; Facsimile: (480) 659-6407, Email:
neil.r@orgenesis.com; with a copy to (which shall not constitute notice) Pearl Cohen Zedek Latzer Baratz, LLP, 7 Times Square, New York,
New York 10036; Attention: Mark Cohen, Esq.; Facsimile: (646) 878-0801, E-Mail: MCohen@pearlcohen.com and (b) if to the Holder, at [●]
or at such other address or addresses (including copies to counsel) as may have been furnished by the Holder to the Company in writing.
The invalidity or unenforceability of any provision hereof shall in no way affect the validity or enforceability of any other provisions.
[Signature
Page Follows]
IN
WITNESS WHEREOF, this Warrant Certificate is issued effective as of the date first set forth above.
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ORGENESIS
INC. |
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Signature Page to
Warrant No. 202[●]-«Warrant No»
EXHIBIT
A
NOTICE
OF EXERCISE
(To
be signed only upon exercise of Warrant)
To:
Orgenesis Inc.
The
undersigned, the Holder of the attached Warrant Certificate, hereby irrevocably elects to exercise the purchase right represented by
such Warrant Certificate for, and to purchase thereunder, __________________________ (________) shares of Common Stock of Orgenesis Inc.
and (choose one) __________ herewith makes payment of ___________________________ Dollars ($_________) thereof
or
__________ elects to
Net Exercise the Warrant pursuant to Section 1(b)(2) thereof.
The
undersigned requests that the certificates or book entry position evidencing the shares to be acquired pursuant to such exercise be issued
in the name of, and delivered to __________________________________________, whose address is _______________________________________________________________________________________________.
By
its signature below the undersigned hereby represents and warrants that it is an “accredited investor” as defined in Rule
501(a) of Regulation D promulgated under the Securities Act of 1933, as amended, and agrees to be bound by the terms and conditions of
the attached Warrant as of the date hereof, including Section 8 thereof.
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(Signature must conform in all respects to name of the Holder as specified on the face of the Warrant Certificate) |
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«XXXXXXXXXX» |
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EXHIBIT
B
NOTICE
OF ASSIGNMENT FORM
FOR
VALUE RECEIVED, _________________ (the “Assignor”) hereby sells, assigns and transfers all of the rights of the undersigned
Assignor under the attached Warrant Certificate with respect to the number of shares of common stock of Orgenesis Inc., a Nevada corporation
(the “Company”) covered thereby set forth below, to the following “Assignee” and, in connection
with such transfer, represents and warrants to the Company that the transfer is in compliance with Section 8 of the Warrant and
applicable federal and state securities laws:
| NAME
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ADDRESS/FAX
NUMBER |
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of shares: |
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Witness: |
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ASSIGNEE
ACKNOWLEDGMENT
The
undersigned Assignee acknowledges that it has reviewed the attached Warrant Certificate and by its signature below it hereby represents
and warrants that it is an “accredited investor” as defined in Rule 501(a) of Regulation D promulgated under the Securities
Act of 1933, as amended, and agrees to be bound by the terms and conditions of the Warrant as of the date hereof, including Section
8 thereof.
Exhibit
10.1
Execution
Version
CONVERTIBLE
LOAN AGREEMENT
THIS
CONVERTIBLE LOAN AGREEMENT (this “Agreement”) is made as of the 10th day of January, 2023 (“Effective Date”),
by and among the lender listed on Exhibit A hereto (“Lender”) and Orgenesis Inc. (“Borrower”
or “Orgenesis”) and together with the Lender, each a “Party” and together the “Parties”).
WHEREAS,
the Lender desires to lend to the Borrower, and the Borrower desires to receive from the Lender, an aggregate amount of US$ 4,000,000
(the “Loan Amount”) pursuant to the terms set forth herein;
NOW,
THEREFORE, in consideration of the premises and the mutual covenants herein contained, and other good and valuable consideration the
receipt and sufficiency of which is hereby acknowledged, the Parties hereby agree as follows:
| (a) | Terms
of Loan. The Lender shall lend to the Borrower, and the Borrower shall borrow from the
Lender, the Loan Amount. The Loan Amount shall bear a simple interest rate of eight percent
(8%) per annuum (based upon a 365-day year); provided, that if an Event of Default
has occurred and is continuing, the Outstanding Amount shall bear interests at the Default
Rate. The Loan Amount, and all accrued but unpaid interest thereon (collectively, the “Outstanding
Amount”), at the discretion of the applicable Lender shall either (i) be repaid
in cash or (ii) convert to shares of common stock, par value $0.0001 per share, of the Borrower
(“Common Stock”) on the third anniversary of the Effective Date (the “Maturity
Date”). The Maturity Date may be extended by the Lender upon the written consent
of the Lender. The Outstanding Amount may be prepaid by the Borrower in whole or in part
at any time with the prior approval of the Lender. |
| (b) | Conditions
Precedent. The obligations of the Lender to fund the Loan Amount shall not become effective
until the date on which each of the following conditions is satisfied (or waived by the Lender),
and the Parties agree that each of the following conditions precedent (“Conditions
Precedent”) have been satisfied or waived. |
| i. | The
Lender shall have received all fees and other amounts due and payable on or prior to the
Closing, including, to the extent invoiced, reimbursement or payment for reasonable out-of-pocket
expenses required to be reimbursed or paid by Borrower, which shall not exceed $150,000. |
| ii. | The
Lender shall have received a certificate of the secretary of Borrower setting forth (i) resolutions
of the board of directors of Borrower (the “Board”) with respect to the
authorization of the Borrower to execute and deliver this Agreement, the Warrants (as defined
below) and any additional agreement or instrument contemplated thereby (the “Transaction
Documents”), (ii) the individuals who are authorized to sign the Transaction Documents,
(iii) specimen signatures of such authorized individuals, and (iv) the articles of incorporation
and bylaws of Borrower, in each case, certified as being true and complete. The Lender may
conclusively rely on such certificate until the Lender receives notice in writing from Borrower
to the contrary. |
| iii. | The
Lender shall have received a certificate from the Chief Financial Officer of Borrower certifying
(1) that the representations and warranties of Borrower set forth in this Agreement are true
and correct in all respects as of the Effective Date, and (2) no event has occurred and is
continuing, or would result from the loans to be made on the Effective Date from the Lender
or from the application of the proceeds therefrom, that constitutes an Event of Default. |
| iv. | The
Lender shall have received (i) a copy of a certificate of the Nevada Secretary of State with
respect to the existence and good standing of Borrower, and (ii) copies of certificates of
the Texas Secretary of State and Maryland Secretary of State with respect to the existence,
qualification (as applicable) and good standing of the applicable operating subsidiary of
Borrower in each such State. |
| v. | The
Lender shall have received the Warrants to Purchase Shares of Common Stock of Borrower, in
substantially the form attached hereto as Exhibit B (the “Warrant”),
duly executed by Borrower. |
| vi. | The
Lender shall have received an opinion of Pearl Cohen Zedek Latzer Baratz LLP, in form and
substance satisfactory to the Lender, as to such matters incident to this Agreement as the
Lender may reasonably request. |
| vii. | Borrower
shall have submitted a Listing Of Additional Shares Notification Form to The Nasdaq Capital
Market with respect to the shares of Common Stock issuable upon conversion of the Outstanding
Amount (as set forth in Section 2 below) or upon any exercise of the Warrant. |
| viii. | Each
Party shall have received from each party counterparts of the Transaction Documents duly
signed on behalf of each party. |
| (c) | Closing.
The closing of the transactions contemplated by this Agreement shall take place following
the satisfaction or waiver of the Conditions Precedent set forth in Section 1(b) above
on or after the Effective Date, or such other date, time and place as the Lender and the
Borrower shall agree upon in writing (the “Closing”). At the Closing,
the Lender shall pay or deliver an amount equal to the Loan Amount to Borrower, by wire transfer
of immediately available funds in accordance with wire instructions provided to Lender by
Borrower prior to the Effective Date. |
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2. |
Conversion of
Loan Amount. |
| (a) | The
Outstanding Amount, shall be convertible as follows: |
| i. | Optional
Conversion. At the option of the Lender, at the Maturity Date or at any time and from
time to time, the Outstanding Amount shall be convertible, in whole or in part, into the
number of shares of Common Stock equal to the quotient obtained by dividing (x) the Outstanding
Amount by (y) the Conversion Price. The “Conversion Price” shall be a
price per share of Common Stock equal to $2.464, which is a ten percent (10%) premium to
the closing price of the Common Stock on The Nasdaq Capital Market on the trading day immediately
preceding the Effective Date; subject to adjustment as provided herein. Any Lender may effect
one or more conversions by delivering to the Borrower a written notice (each, a “Notice
of Conversion”), specifying therein the Loan Amount and accrued interest, if any,
to be converted, and the date on which such conversion shall be effected (such date, the
“Conversion Date”). If no Conversion Date is specified in a Notice of
Conversion, the Conversion Date shall be the date that such Notice of Conversion is deemed
delivered hereunder. Following the applicable Conversion Date, a Conversion completed pursuant
to this Section 2(a)(i) shall have the effect of reducing the Outstanding Amount in
amount equal to the Loan Amount set forth in the corresponding Notice of Conversion. The
Parties shall maintain records showing the total Outstanding Amount converted and the date
of each such Conversion. |
| ii. | Conversion
upon a Change of Control. In the case of a Change of Control where the Common Stock remains
outstanding, the Outstanding Amount shall automatically convert into shares of Common Stock
at the Conversion Price (the “Conversion Consideration”) at the effective
time of such Change of Control. |
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| | | In
the case of a Change of Control pursuant to which shares of Common Stock will be converted into cash, securities or other property or
assets (including any combination thereof) of another entity (the “Alternative Form Consideration”), the Lender shall
receive upon conversion of the Outstanding Amount the kind and amount of Alternative Form Consideration which the Lender would have owned
or been entitled to receive upon the Change of Control had the Lender held a number of shares of Common Stock equal to the Conversion
Consideration immediately prior to the effective time of such Change of Control. |
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| | | For purposes of this section, a “Change of Control” shall mean (1) the consummation of a merger, consolidation or similar
transaction approved by the Board in which 50% or more of the outstanding shares of Common Stock are exchanged for securities, cash or
other consideration issued or paid, or caused to be issued or paid, by the acquiring company or its affiliates, (2) the consummation
of a tender offer for, or other acquisition of, Common Stock or other convertible securities, in which an individual, corporation, partnership,
limited liability company, joint venture, trust or unincorporated organization or a government or agency or political subdivision thereof
(a “Person”) or group (as such term is defined in Rule 13d-5 under the Securities Exchange Act of 1934, as amended
(the “Exchange Act”)) of Persons become the beneficial owner (as determined pursuant to Rule 13d-3 under the Exchange
Act), directly or indirectly, of 50% or more of the total voting power of the outstanding shares of Common Stock; or (3) the sale of
all or substantially all of the assets of the Borrower |
| iii. | Conversion
at Maturity. To the extent that the Loan Amount is not earlier repaid or converted pursuant
to the provisions of this Section 2, on the Maturity Date, the Outstanding Amount
shall be (1) payable in cash, or (2) convertible into shares of Common Stock of Borrower
at the Conversion Price, in each case at the option of the Lender. |
| iv. | Mandatory
Conversion. In the event the closing price of the Common Stock on The Nasdaq Capital
Market (or other national stock exchange or market on which the Common Stock is then listed
or quoted) equals or exceeds $15.00 per share (which amount may be adjusted for certain capital
events, such as stock splits, as described herein) for ten (10) consecutive trading days
(a “Conversion Event”), then the Lender must convert the Outstanding Amount
into shares of Common Stock at the Conversion Price. Borrower shall notify the Lender of
a Conversion Event and the Lender shall convert the Outstanding Amount within five (5) days
from receipt of notice of a Conversion Event from Borrower. |
| v. | Mandatory
Exercise of Warrants. All Warrants issued to the Lender in connection with this Agreement
are subject to mandatory exercise wherein Borrower shall have the right to require the Lender
to exercise all or any portion of the Warrant that is still unexercised for a cash exercise
when the closing price of the Common Stock on The Nasdaq Capital Market equals or exceeds
$15.00 per share for ten consecutive trading days. Borrower may exercise its right to require
this exercise by giving the Lender written notice of the exercise through delivery of the
exercise notice. |
| (b) | In
the event the Outstanding Amount is converted pursuant to Section 2(a), the Lender
shall surrender this Agreement to Borrower and this Agreement shall be thereupon cancelled.
As soon as practicable, and at its expense, Borrower shall issue and deliver to the Lender
a certificate or certificates representing the number of shares of Common Stock to which
the Lender is entitled upon such conversion. |
| (c) | No
fractional shares shall be issued upon the conversion of any portion of the Outstanding Amount.
In the Lender’s sole discretion, Borrower shall either pay to the Lender in cash the
unconverted amount that would otherwise be converted into such factional share or interest
or round the shares of Common Stock being issued upon conversion up to the nearest whole
number. |
| (d) | The
issuance of shares of Common Stock on conversion of all or any portion of the Outstanding
Amount shall be made without charge to the Lender for any documentary stamp or similar taxes
that may be payable in respect of the issue or delivery of such shares upon conversion. |
| (e) | If
Borrower, at any time while there is an Outstanding Amount, subdivides (by any stock split,
stock dividend, recapitalization or otherwise) one or more classes of its outstanding shares
of Common Stock into a greater number of shares, the Conversion Price in effect immediately
prior to such subdivision will be proportionately reduced. If Borrower, at any time while
there is an Outstanding Amount, combines (by combination, reverse stock split or otherwise)
one or more classes of its outstanding shares of Common Stock into a smaller number of shares,
the Conversion Price in effect immediately prior to such combination will be proportionately
increased. Any adjustment under this Section 2(e) shall become effective at the close
of business on the date the subdivision or combination becomes effective, or as of the record
date of stock dividend, or in the event that no record date is fixed, upon the making of
such stock dividend. |
| 3. | Use
of Proceeds. Borrower shall use the Loan Amount and the $1,000,000 loan amount under
a convertible loan agreement with Ariel Malik on the same terms as this Agreement to (i)
redeem the Convertible Loan Agreement, dated as of May 19, 2022 between Orgenesis and Ricky
Steven Neumann, as amended by that certain Convertible Loan Extension Agreement, dated as
of October 23, 2022, by and between Orgenesis and Ricky Steven Neumann, and (ii) for general
corporate purposes. The use of proceeds from any Additional Loan Amount (as defined herein)
shall be used solely to redeem existing indebtedness (including other convertible loan agreements
entered into by Borrower prior to the Closing); provided, that $3,000,000 of such
Additional Loan Amount may be used for general corporate purposes. |
| 4. | Covenants.
Until the Outstanding Amount has been paid in full (or converted in accordance with Section 2), Borrower covenants and agrees
with the Lender that: |
| (a) | Shares
Available. Borrower shall at all times reserve and keep available out of its authorized
and unissued shares of Common Stock, such number of shares of Common Stock as may at any
times be required for issuance upon conversion of all or any portion of the Outstanding Amount
or exercise of all or any portion of the Warrant, in each case, free from preemptive rights
or any other actual contingent purchase rights of persons other than the Lender. The Borrower
covenants that all shares of Common Stock that shall be so issuable shall, upon issuance,
be duly authorized, validly issued, fully paid and nonassessable. |
| (b) | Merger,
Consolidation and Related Events. Borrower shall not (i) become a party to a merger or
consolidation, or purchase or otherwise acquire all or a substantial part of the assets of
any Person or any shares or other evidence of beneficial ownership of any Person; provided,
that the covenant contained in this Section 4(b)(i) shall not apply to (1) any acquisition
of shares or equity interests pursuant to Borrower’s equity buy-out rights contained
in any joint venture agreement to which Borrower is or becomes a party, or (2) any merger
or consolidation where the Outstanding Amount is repaid in full; provided, further
that nothing in the foregoing Section 4(b)(i)(1) or Section 4(b)(i)(2) shall
be deemed to prohibit or impede Lender’s ability to exercise its conversion rights
in Section 2 above at any time or from time to time, (ii) dissolve or liquidate, (iii)
sell, lease, assign, transfer or otherwise dispose of substantially all of its assets, except
dispositions of inventory in the ordinary course of business, or (iv) enter into any agreement
to do any of the foregoing. |
| (c) | Corporate
Existence; Conduct of Business. Borrower will preserve and maintain its corporate existence
and all of its leases, privileges, licenses, permits, franchises, qualifications and rights
that are necessary or desirable in the ordinary conduct of its business. Except as contemplated
in transactions with the Lender and its affiliates, Borrower will continue to conduct its
primary businesses as conducted as of the date of this Agreement and to continue its operations
in such businesses. |
| (d) | Compliance
with Laws. Borrower will comply in all material respects with all applicable laws (including
all environmental laws), rules, regulations and orders of any the government of the United
States of America, any other nation or any political subdivision thereof, whether state,
local or tribal, and any agency, authority, instrumentality, regulatory body, court, central
bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative
powers or functions of or pertaining to government (“Governmental Authority”),
or arbitrator, and all agreements, contracts and instruments binding on it or affecting its
properties or business. |
| (e) | Maintenance
of Assets and Properties. Borrower will maintain its material assets and properties (including
material intellectual property) in good condition and repair. |
| (f) | Payment;
Discharge; Liens. Borrower will pay or discharge at or before maturity or before becoming
delinquent (a) all material taxes, levies, assessments and governmental charges imposed on
it or its income or profits or any of its property and (b) all lawful claims for labor, material
and supplies, which, if unpaid, might become a Lien upon any of its property; provided,
however, that Borrower shall not be required to pay or discharge any claim, tax, levy,
assessment or governmental charge (a “Tax or Claim Charge”), which is
being contested in good faith by appropriate proceedings diligently pursued, if (i) no asset
or any portion thereof or interest therein would be in any danger of sale, forfeiture or
loss by reason of the contest for such Tax or Claim Charge, and (ii) Borrower has set aside
on its books adequate reserves against such Tax or Claim Charge. |
| (g) | Debt;
Additional Loans. Borrower will not incur, create, assume or suffer to exist any new
obligations for borrowed money except: (i) the obligations arising under this Agreement and
the $1,000,000 convertible loan agreement with Ariel Malik on the same terms as this Agreement
or pursuant to any existing convertible loan agreement or other indebtedness as of the Effective
Date, which are all set forth on Schedule 4(g), (ii) subject to Borrower’s compliance
with the use of proceeds restrictions set forth in Section 3 above, additional convertible
loan agreements with one or more additional lenders, entered into no later than March 11,
2023 on substantially the same terms and conditions as this Agreement for an aggregate amount
(including the Loan Amount hereunder) of up to $15,000,000 the “Additional Loan
Amount”), (iii) accounts payable and other accrued expenses, liabilities or other
obligation to pay from time to time incurred in the ordinary course of business with respect
to which no more than ninety (90) days have elapsed since the date of invoice or that are
being contested in good faith by appropriate action and for which adequate reserves have
been maintained in accordance with generally accepted accounting principles in the United
States of America, and (iv) any indebtedness of Borrower consisting of the financing of insurance
premiums incurred in the ordinary course of business. |
| (a) | The
following shall constitute events of default (each an “Event of Default”): |
| i. | Borrower
shall fail to pay any installment of principal or interest on Loan Amount, or Additional
Loan Amount, if any, or any other sum secured hereby when due and Borrower fails to cure
such default within ten (10) days after written notice of default is sent to Borrower; |
| ii. | Any
representation or warranty made or deemed made by Borrower or any of its respective officers
in any certificate or notice furnished at any time in connection with this Agreement or any
other Transaction Document shall be false, misleading or erroneous in any material respect
when made or deemed to have been made; |
| iii. | Borrower
shall fail to perform, observe or comply with the observance or performance of any non-monetary
covenant or agreement contained herein and the Borrower fails to cure such default within
thirty (30) days after written notice of default is sent to the Borrower (or within such
other longer time period as may be therein specifically provided); |
| iv. | Borrower
shall fail to perform, observe or comply with the obligations, terms, covenants or conditions
contained in this Agreement or any other Transaction Document and such failure is not cured
within thirty (30) days from the earliest to occur of the date the Lender delivers notice
of such failure to Borrower; |
| v. | Borrower
shall (1) commence a voluntary proceeding seeking liquidation, reorganization, or other relief
with respect to its debts under any present or future federal, state or other statute, law
or regulation relating to bankruptcy, insolvency or other relief for debtors seeking the
appointment of a trustee, receiver, liquidator, custodian, or other similar official of it
or of all or any part of the assets of Borrower or its subsidiaries, or of any or all of
the royalties, revenues, rents, issues or profits thereof, (2) consent to any such relief
or to the appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, (3) make a general assignment for the benefit of
creditors or shall generally fail to pay its debts as they become due or (4) take any corporate
action to authorize any of the foregoing; |
| vi. | an
involuntary proceeding shall be commenced against Borrower seeking any liquidation, reorganization,
dissolution or similar relief under any present or future federal, state or other statute,
law or regulation relating to bankruptcy, insolvency or other relief for debtors, and such
petition shall remain undismissed and unstayed for a period of sixty (60) days (whether or
not consecutive) from the first date of entry thereof or rejected by such court; or any trustee,
receiver or liquidator of Borrower or of all or any part of the assets of Borrower or its
subsidiaries, or of any or all of the royalties, revenues, rents, issues or profits thereof,
shall be appointed without the consent or acquiescence of Borrower and such appointment shall
remain undismissed and unstayed for an aggregate of sixty (60) days (whether or not consecutive); |
| vii. | a
writ of execution or attachment or any similar process shall be issued or levied against
all or any part of or interest in the assets of Borrower or its subsidiaries, or any judgment
involving monetary damages shall be entered against Borrower which shall become a Lien on
the assets the assets of Borrower or its subsidiaries or any portion thereof or interest
therein and such execution, attachment or similar process or judgment is not released, bonded,
satisfied, vacated or stayed within sixty (60) days after its entry or levy; |
| viii. | the
Borrower ceases or threatens to cease to carry on its business; |
| ix. | this
Agreement or any other Transaction Document shall for any reason not be, or cease to be,
in full force and effect or shall be declared null and void or the validity or enforceability
thereof shall be contested or challenged by Borrower, or Borrower shall deny that it has
any further liability or obligation hereunder prior to payment in full of all obligations
hereunder; or |
| x. | the
Borrower admits its inability to pay its debts upon their falling due. |
| (b) | If
an Event of Default occurs and is ongoing, the interest on the Outstanding Amount shall increase
to a rate of fifteen percent (15.0%) per annum (the “Default Rate”). |
| (c) | If,
at any time, an Event of Default shall occur, all obligations under this Agreement shall
become immediately due and payable without presentment, demand or protest, all of which are
hereby waived by the Borrower. |
| 6. | Representations
and Warranties of Borrower. To induce the Lender to enter into this Agreement and to
fund the Loan Amount, Borrower hereby represents and warrants to the Lender (as follows: |
| (a) | Organization;
Powers. Borrower is duly formed, validly existing and in good standing under the laws
of the State of Nevada. Borrower has the full power and authority to own its assets and to
carry on its business as now conducted, and is qualified to do business in, and is in good
standing in, every jurisdiction where such qualification is required, except where failure
to have such power, authority and qualifications could not reasonably be expected to have
a Material Adverse Effect. |
| | | |
| | | For
purposes of this Agreement, a “Material Adverse Effect” means a material adverse change in, or material adverse effect
on, (i) the business, operations, property, liabilities (actual or contingent) or condition (financial or otherwise) of Borrower, (ii)
the ability of Borrower to perform any of its obligations under any Transaction Document to which it is a party, (iii) the validity or
enforceability of any Transaction Document or (d) the rights and remedies of or benefits available to the Lender under any Transaction
Document. |
| (b) | Authority;
Enforceability. Borrower has the power and authority to consummate the transactions contemplated
in this Agreement and in each other Transaction Document (the “Transactions”).
When executed and delivered, each Transaction Document will have been duly executed and delivered
by Borrower and will constitute a legal, valid and binding obligation of Borrower, enforceable
in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting creditors’ rights generally and subject to general
principles of equity, regardless of whether considered in a proceeding in equity or at law. |
| (c) | Approvals;
No Conflicts. The consummation of the Transactions (1) do not require any consent, license,
or approval of, registration or filing with, or any other action by, any Governmental Authority
or any other third Person, except such as have been obtained or made and are in full force
and effect, (2) will not violate the provisions of any applicable law, (3) will not violate
or result in a default under any agreement or instrument to which the Borrower is a party
or under which any properties or assets of Borrower or its subsidiaries are bound, and (4)
will not result in the creation or imposition of any Lien on any property or asset of Borrower
or its subsidiaries. |
| (d) | Litigation.
Except as set forth in Borrower’s filings with the U.S. Securities and Exchange Commission,
there are no actions, suits, investigations or proceedings by or before any arbitrator or
Governmental Authority pending against or, to the knowledge of Borrower, threated against
or affect Borrower or any of its subsidiaries that (a) could reasonably be expected to be
adversely determined and, if so determined, could reasonably be expected individually or
in the aggregate, to result in a Material Adverse Effect, or (b) involve any Transaction
Document or the Transactions. |
| (e) | Investment
Company Act. Neither Borrower nor any of its subsidiaries is an “investment company”
or a company “controlled” by an “investment company,” within the
meaning of, or subject to regulation under, the Investment Company Act of 1940, as amended. |
| 7. | Representations
and Warranties of Lender. Lender hereby represents and warrants to Borrower as follows: |
| (a) | Due
Execution. When executed and delivered, each Transaction Document will have been duly
executed and delivered by the Lender and will constitute a legal, valid and binding obligation
of the Lender, enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally
and subject to general principles of equity, regardless of whether considered in a proceeding
in equity or at law. |
| 8. | Waiver;
Non-Negotiable. Borrower, for itself and each of its legal representatives, hereby waives
presentment for payment, demand, right of setoff, notice of nonpayment, notice of dishonor,
protest of any dishonor, notice of protest and protest of this Agreement, and all other notices
in connection with the delivery, acceptance, performance, default or enforcement of the obligations
under this Agreement. This Agreement is non-negotiable. |
| 9. | Further
Assurances. The Parties shall perform such further acts and execute such further documents
as may reasonably be necessary to carry out and give full effect to the provisions of this
Agreement. |
| (a) | Entire
Agreement; Amendments. This Agreement and each of the Transaction Documents constitutes
the entire understanding of the Parties hereto with respect to the subject matter hereof
and supersedes all prior written and oral understandings of such parties with regard thereto.
This Agreement may be modified, amended, or any term hereof waived with the written consent
of the Borrower and the Lender. Any amendment effected in accordance with this Section
10(a) shall be binding upon all Parties and their respective successors and assignees. |
| (b) | Governing
Law; Jurisdiction. This Agreement shall be governed by and construed according to the
laws of the State of New York without regard to the conflict of laws provisions thereof.
Any dispute arising under or in relation to this Agreement shall be resolved in the competent
courts of the State of New York or of the United States of America for the Southern District
of New York, in either case, located in New York County, New York, and each of the Parties
hereby submits irrevocably to the jurisdiction of such courts. Each Party hereby irrevocably
waives any objection, including, without limitation, any objection to the laying of venue
or based on the grounds of forum non conveniens, which it may now or hereafter have to the
bringing of any such action or proceeding in such respective jurisdictions. |
| (c) | Waiver
of Jury Trial. Each Party hereby irrevocably and unconditionally waives, to the fullest
extent permitted by law, trial by jury in any legal action or proceeding relating to this
Agreement or any other Transaction Document and for any counterclaim therein. |
| (d) | Notices.
All notices and other communications required or permitted hereunder to be given to a Party
to this Agreement shall be in writing and shall be telecopied or mailed by registered or
certified mail, postage prepaid, or otherwise delivered by hand or by messenger. Any notice
sent in accordance with this Agreement shall be effective (i) if mailed, seven (7) business
days after mailing to the address set forth each Party’s signature below, (ii) if sent
by messenger, upon delivery, and (iii) if sent via telecopier, upon transmission and electronic
confirmation of receipt or (if transmitted and received on a non-business day) on the first
business day following transmission and electronic confirmation of receipt. Additionally,
a copy of each notice sent or delivered to (1) the Borrower (which does not constitute a
notice) shall be sent or delivered to Mark Cohen, Esq., c/o Pearl Cohen Zedek Latzer Baratz
LLP, Times Square Tower, 7 Times Square, New York, NY 10036, and (2) the Lender (which does
not constitute a notice) shall be sent or delivered to Hunton Andrews Kurth LLP, 600 Travis
Street, Suite 4200, Houston, TX 77002, Attention: Phil Haines. |
| (e) | Assignment;
Waiver. This Agreement may not be assigned by the Borrower without the prior written
consent of the Lender. The Lender may assign this Agreement without the prior written consent
of the Borrower. This Agreement shall be binding upon the successors, assigns and representatives
of each Party. No delay or omission to exercise any right, power, or remedy accruing to any
Party upon any breach or default under this Agreement, shall be deemed a waiver of any other
breach or default theretofore or thereafter occurring. All remedies, either under this Agreement
or by law or otherwise afforded to any of the Parties, shall be cumulative and not alternative. |
| (f) | Severability.
If any provision of this Agreement is held by a court of competent jurisdiction to be unenforceable
under applicable law, then such provision shall be excluded from this Agreement and the remainder
of this Agreement shall be interpreted as if such provision were so excluded and shall be
enforceable in accordance with its terms; provided, however, that in such event this Agreement
shall be interpreted so as to give effect, to the greatest extent consistent with and permitted
by applicable law, to the meaning and intention of the excluded provision as determined by
such court of competent jurisdiction. |
| (g) | Counterparts.
This Agreement may be executed in any number of counterparts, each of which shall be deemed
an original but all of which together shall constitute one and the same instrument. |
| (h) | Headings.
Section headings are used herein for convenience and reference only, are not party of this
Agreement and shall not affect the construction of, or be taken into consideration in interpreting,
this Agreement. |
[Remainder
of Page Intentionally Left Blank]
IN
WITNESS WHEREOF, the Parties have executed this Convertible Loan Agreement as of the date first above written.
| “BORROWER” |
|
| |
|
| ORGENESIS
INC. |
|
| |
|
|
| By: |
/s/
Vered Caplan |
|
| Name: |
Vered Caplan |
|
| Title: |
Chief Executive Officer |
|
| Address: |
20271 Goldenrod Lane |
|
| |
Germantown,
Maryland, 20776 USA |
|
| |
|
|
| “LENDER” |
|
| |
|
| NewTech
Investment Holdings, LLC |
|
| |
|
|
| By: |
/s/
Guy Hoffman |
|
| Name: |
Guy Hoffman |
|
| Title: |
Managing Member |
|
| Address: |
3642 Underwood Street |
|
| |
Houston, TX 77025 |
|
EXHIBIT
A
| Name
of Lender |
|
Loan
Amount |
|
Date |
| NewTech
Investment Holdings, LLC |
|
$
4,000,000 |
|
January
10, 2023 |
EXHIBIT
B
FORM
OF WARRANT
[see
attached]
THIS
WARRANT CERTIFICATE AND THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT
REQUIRED UNDER SUCH ACT OR UNLESS SOLD IN ACCORDANCE WITH RULE 144 UNDER SUCH ACT.
| WARRANT
CERTIFICATE NO. 2023-[●] |
|
NUMBER
OF WARRANTS: [●] |
| DATE
OF ISSUANCE: [●] |
|
|
| INITIAL
EXERCISE DATE: [●] |
|
(subject
to adjustment hereunder) |
| EXPIRATION
DATE: [●], 202[●] |
|
|
WARRANTS
TO PURCHASE SHARES
OF
COMMON STOCK OF
ORGENESIS
INC.
This
Warrant Certificate (this “Warrant Certificate”) represents [●] warrants to purchase shares of Common Stock
(as defined below) and is issued to [●], or its registered assigns (including any successors or assigns, the “Holder”),
pursuant to that certain Convertible Loan Agreement, dated as of [●] (the “Loan Agreement”), among Orgenesis
Inc., a Nevada corporation (the “Company”), the Holder and [●].
1.
EXERCISE OF WARRANT.
(a)
Number and Exercise Price of Warrant Shares; Expiration Date. Subject to the terms and conditions set forth herein, the Holder
is entitled to purchase from the Company up to [●] shares of the Company’s Common Stock, $0.0001 par value per share (the
“Common Stock”) (as adjusted from time to time pursuant to the provisions of this Warrant Certificate) (the “Warrant
Shares”), at a purchase price of $2.50 per share (as adjusted from time to time pursuant to the provisions of this Warrant,
the “Exercise Price”), at any time on or after [●] (the “Initial Exercise Date”) and on or
before 5:00 p.m. New York City time on [●] (the “Expiration Date”) (subject to earlier termination of this Warrant
Certificate as set forth herein).
(b)
Method of Exercise. While this Warrant Certificate remains outstanding and exercisable in accordance with Section 1(a) above,
the Holder may exercise any or all of the Warrants represented by this Warrant Certificate by surrendering this Warrant Certificate at
the principal office of the Company and paying the Exercise Price of the Warrants to be exercised hereunder by either:
(1)
wire transfer to the Company or cashier’s check drawn on a United States bank made payable to the order of the Company, or
(2)
if there is no effective registration statement registering, or no current prospectus available for, the resale of the Warrant Shares
by the Purchaser, exercising of the right to credit the Exercise Price against the Fair Market Value of the Warrant Shares (as defined
below) at the time of exercise (the “Net Exercise”) pursuant to Section 1(c).
(c)
Net Exercise. If the Company shall receive written notice from the Holder at the time of exercise of Warrants hereunder that the
Holder elects to Net Exercise such Warrants, the Company shall deliver to such Holder (without payment by the Holder of any exercise
price in cash) that number of Warrant Shares computed using the following formula:
Where
| |
X
= |
The
number of Warrant Shares to be issued to the Holder. |
| |
|
|
| |
Y
= |
The
number of Warrant Shares purchasable based on the number of Warrants being exercised. |
| |
|
|
| |
A
= |
The
Fair Market Value of one (1) share of Common Stock (at the date of such calculation). |
| |
|
|
| |
B
= |
The
Exercise Price (as adjusted to the date of such calculations). |
The
“Fair Market Value” of one share of Common Stock shall mean (x) the closing price of the Common Stock on the business
day prior to the date of exercise on The Nasdaq Capital Market as reported by Bloomberg Financial Markets (or a comparable reporting
service of national reputation selected by the Company and reasonably acceptable to the holder if Bloomberg Financial Markets is not
then reporting sales prices of the Common Stock) (collectively, “Bloomberg”) or (y) or if the foregoing does not apply,
the last sales price of the Common Stock in the over-the-counter market on the pink sheets or bulletin board for such security as reported
by Bloomberg, and, if there are no sales, the last reported bid price of the Common Stock as reported by Bloomberg or, if the Fair Market
Value cannot be calculated as of such date on either of the foregoing bases, the price determined in good faith by the board of directors
of the Company.
2.
CERTAIN ADJUSTMENTS.
(a)
Adjustment of Number of Warrant Shares and Exercise Price. The number of shares of Common Stock issuable upon the exercise of
each Warrant represented by this Warrant Certificate (the “Warrant Number”) is initially one. The Warrant Number and kind
of Warrant Shares purchasable upon exercise of each Warrant and the Exercise Price shall be subject to adjustment from time to time as
follows:
(1)
Subdivisions, Combinations and Other Issuances. If the Company shall at any time after the Date of Issuance but prior to the Expiration
Date subdivide its shares of capital stock of the same class as the Warrant Shares, by split-up or otherwise, or combine such shares
of capital stock, or issue additional shares of capital stock as a dividend with respect to any shares of such capital stock, the Warrant
Number shall forthwith be proportionately increased in the case of a subdivision or stock dividend, or proportionately decreased in the
case of a combination. Appropriate adjustments shall also be made to the Exercise Price payable per share, but the aggregate Exercise
Price payable for the total number of Warrant Shares purchasable under all Warrants initially represented by this Warrant Certificate
(as adjusted) shall remain the same. Any adjustment under this Section 2(a)(1) shall become effective at the close of business on the
date the subdivision or combination becomes effective, or as of the record date of such dividend, or in the event that no record date
is fixed, upon the making of such dividend.
(2)
Adjustments for Other Dividends and Distributions. In the event the Company at any time or from time to time after the Date of
Issuance shall make or issue, or fix a record date for the determination of holders of Common Stock entitled to receive, a dividend or
other distribution payable in securities of the Company (other than shares of Common Stock) or in cash or other property, then and in
each such event provision shall be made so that the Holder shall receive upon exercise hereof, in addition to the number of shares of
Common Stock issuable hereunder, the kind and amount of securities of the Company, cash or other property that the Holder would have
been entitled to receive had all Warrants represented by this Warrant Certificate been exercised on the date of such event and had the
Holder thereafter, during the period from the date of such event to and including the Exercise Date, retained any such securities receivable
during such period, giving application to all adjustments called for during such period under this Section 2 with respect to the rights
of the Holder.
(3)
Reorganizations or Mergers. In case of any reclassification, capital reorganization or change in the capital stock of the Company
(other than as a result of a subdivision, combination or stock dividend provided for in Section 2(a)(1) above) that occurs after
the Date of Issuance, then, as a condition of such reclassification, reorganization or change, lawful provision shall be made, and duly
executed documents evidencing the same from the Company or its successor shall be delivered to the Holder, so that the Holder shall thereafter
have the right at any time prior to the expiration of the Warrants represented by this Warrant Certificate to purchase, at a total price
equal to that payable upon the exercise of the Warrants represented by this Warrant Certificate, the kind and amount of shares of stock
and/or other securities or property (including, if applicable, cash) receivable in connection with such reclassification, reorganization
or change by a holder of the same number and type of securities as were purchasable as Warrant Shares by the Holder immediately prior
to such reclassification, reorganization or change. In any such case appropriate provisions shall be made with respect to the rights
and interest of the Holder so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other
securities or property deliverable upon exercise hereof, and appropriate adjustments shall be made to the Exercise Price payable hereunder,
provided the aggregate Exercise Price shall remain the same (and the Warrants shall be exclusively exercisable for such shares of stock
and/or other securities or property from and after the consummation of such reclassification or other change in the capital stock of
the Company).
(b)
Notice to Holder. If, while any Warrant is outstanding, the Company (i) declares a dividend or any other distribution of cash,
securities or other property in respect of its Common Stock, including, without limitation, any granting of rights or warrants to subscribe
for or purchase any capital stock of the Company or any subsidiary, (ii) authorizes or approves, enters into any agreement contemplating
or solicits stockholder approval for any Change of Control or (iii) authorizes the voluntary dissolution, liquidation or winding up of
the affairs of the Company, then the Company shall deliver to a holder a notice of such transaction at least 15 business days prior to
the applicable record or effective date on which a person would need to hold Common Stock in order to participate in or vote with respect
to such transaction; provided, however, that the failure to deliver such notice or any defect therein shall not affect the validity of
the corporate action required to be described in such notice.
(c)
Calculations. All calculations under this Section 2 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 2, the number of shares of Common Stock deemed to be issued and outstanding as
of a given date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.
(d)
Treatment of Warrant upon a Change of Control.
(1)
In the event of a Change of Control in which the consideration to be received by the Company’s stockholders consists solely of
cash, solely of Marketable Securities (as defined below) or a combination of cash and Marketable Securities (a “Cash/Public
Change of Control”), if any Warrant is outstanding upon the consummation of such Cash/Public Change of Control then (i) if
the Fair Market Value of one share of Common Stock (as determined in accordance with Section 1(c)) is greater than the then applicable
Exercise Price, the Warrants may be exercised at the election of the Holder on a net exercise issue basis pursuant to Section 1(c)
as of immediately prior to such Cash/Public Change of Control and (ii) if the Fair Market Value of one share of Common Stock (as
determined in accordance with Section 1(c)) is less than or equal to the then applicable Exercise Price, the Warrants will expire
immediately prior to the consummation of such Change of Control; provided that during the term of the Warrants, each of the Company’s
outstanding warrants will be treated in the same manner as above subject to the terms of such outstanding warrants existing on the Date
of Issuance.
(2)
If, at any time while any of the Warrants is outstanding, the Company consummates a Change of Control that is not a Cash/Public Change
of Control, then a Holder shall have the right thereafter to receive, upon exercise of a Warrant, the same amount and kind of securities,
cash or property as it would have been entitled to receive upon the occurrence of such Change of Control if it had been, immediately
prior to such Change of Control, a holder of the number of Warrant Shares then issuable upon exercise in full of the Warrant (the “Alternate
Consideration”). The Company shall not effect any such Change of Control unless prior to or simultaneously with the consummation
thereof, any successor to the Company, surviving entity or the corporation purchasing or otherwise acquiring such assets or other appropriate
corporation or entity shall assume the obligation to deliver to the Holder, such Alternate Consideration as, in accordance with the foregoing
provisions, the Holder may be entitled to purchase, and the other obligations under this Warrant Certificate.
(3)
As used in this Warrant Certificate, a “Change of Control” shall mean (i) a merger or consolidation of the Company
with another corporation (other than a merger effected exclusively for the purpose of changing the domicile of the Company), (ii) the
sale, assignment, transfer, conveyance or other disposal of all or substantially all of the properties or assets or all or a majority
of the outstanding voting shares of capital stock of the Company, (iii) a purchase, tender or exchange offer accepted by the holders
of a majority of the outstanding voting shares of capital stock of the Company, or (iv) a “person” or “group”
(as these terms are used for purposes of Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”)) is or shall become the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly at least a majority of the voting power of the capital stock of the Company.
(4)
As used in this Warrant Certificate, “Marketable Securities” means securities meeting all of the following requirements:
(i) the issuer thereof is then subject to the reporting requirements of Section 13 or Section 15(d) of the Securities Exchange Act, and
is then current in its filing of all required reports and other information under the Securities Act of 1933, as amended (the “Securities
Act”), and the Exchange Act; (ii) the class and series of shares or other security of the issuer that would be received by
the Holder in connection with the Change of Control were the Holder to exercise the Warrants on or prior to the closing thereof is then-traded
or quoted on a nationally recognized securities exchange, inter-dealer quotation system or over-the-counter market, and (iii) following
the closing of such Change of Control, the Holder would not be restricted from publicly re-selling all of the issuer’s shares and/or
other securities that would be received by the Holder in such Change of Control were the Holder to exercise or convert the Warrants in
full on or prior to the closing of such Change of Control, except to the extent that any such restriction (x) arises solely under federal
or state securities laws, rules or regulations, and (y) does not extend beyond six months from the closing of such Change of Control.
3.
NO FRACTIONAL SHARES. No fractional Warrant Shares or
scrip representing fractional shares will be issued upon exercise of any Warrant. In lieu of any fractional shares which would otherwise
be issuable, the Company shall pay cash equal to the product of such fraction multiplied by the Fair Market Value of one Warrant Share.
4.
NO STOCKHOLDER RIGHTS. Until the exercise of a Warrant,
the Holder shall not have, nor exercise, any rights as a stockholder of the Company (including without limitation the right to notification
of stockholder meetings or the right to receive any notice or other communication concerning the business and affairs of the Company)
except as provided in Section 9 below.
5.
RESERVATION OF STOCK. The Company covenants that during
the period the Warrants are exercisable, the Company will reserve from its authorized and unissued Common Stock a sufficient number of
shares of Common Stock (or other securities, if applicable) to provide for the issuance of Warrant Shares (or other securities) upon
the exercise of the Warrants.
6.
MECHANICS OF EXERCISE.
(a)
Delivery of Warrant Shares Upon Exercise. The Warrants may be exercised by the Holder, in whole or in part, by the surrender of this
Warrant Certificate and the Notice of Exercise attached hereto as Exhibit A duly completed and executed on behalf of the Holder, at the
principal office of the Company together with payment in full of the Exercise Price (unless the Holder has elected to Net Exercise) then
in effect with respect to the number of Warrant Shares as to which the Warrant is being exercised. The Warrants shall be deemed to have
been exercised immediately prior to the close of business on the date of surrender for exercise as provided above, and the person entitled
to receive the Warrant Shares issuable upon such exercise shall be treated for all purposes as the holder of such shares of record as
of the close of business on such date. Warrant Shares purchased hereunder shall be transmitted by the Company’s transfer agent
to the Holder by crediting the account of the Holder’s prime broker with The Depository Trust Company through its Deposit or Withdrawal
at Custodian system if the Company is then a participant in such system and either (A) there is an effective registration statement permitting
the issuance of the Warrant Shares to or resale of the Warrant Shares by the Holder or (B) the shares are eligible for resale by the
Holder without volume or manner-of-sale limitations pursuant to Rule 144, and otherwise by physical delivery to the address specified
by the Holder in the Notice of Exercise by the end of the day on the date that is three trading days from the delivery to the Company
of the Notice of Exercise, surrender of this Warrant Certificate and payment of the aggregate Exercise Price (unless exercised by means
of a cashless exercise pursuant to Section 1(c). 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 such Warrants have been exercised, with payment to the Company of the Exercise Price (or by Net Exercise) and all taxes required
to be paid by the Holder, if any, prior to the issuance of such shares, having been paid. The Company will pay all documentary stamp
taxes and other governmental charges (excluding all foreign, federal or state income, capital gains franchise, property, estate, inheritance,
gift or similar taxes) in connection with the issuance or delivery or the exercise of any Warrant.
(b)
Holder’s Exercise Limitations. The Holder shall not have the right to exercise Warrants, pursuant to Section 1 or otherwise,
to the extent that after giving effect to such issuance after exercise as set forth on the applicable Notice of Exercise, the Holder
(together with the Holder’s affiliates, and any other persons acting as a group together with the Holder or any of the Holder’s
affiliates), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing
sentence, the aggregate number of shares of Common Stock beneficially owned by the Holder and its affiliates shall include the number
of shares of Common Stock issuable upon exercise of the outstanding Warrants represented hereby with respect to which such determination
is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (i) exercise of the remaining, nonexercised
portion of the Warrants represented hereby beneficially owned by the Holder or any of its affiliates and (ii) exercise or conversion
of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation, any other convertible
notes or convertible preferred stock or warrants) subject to a limitation on conversion or exercise analogous to the limitation contained
herein beneficially owned by the Holder or any of its affiliates. Except as set forth in the preceding sentence, for purposes of this
section, 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 the Holder that the Company is not representing to the Holder that such calculation
is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible for any schedules required to be filed in
accordance therewith. To the extent that the limitation contained in this Section 6(b) applies, the determination of whether the Warrants
are exercisable (in relation to other securities owned by the Holder together with any of its affiliates) and of which portion of the
Warrants are exercisable shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to
be the Holder’s determination of whether the Warrants are exercisable (in relation to other securities owned by the Holder together
with any of its affiliates) and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation,
and the Company shall have no obligation to verify or confirm the accuracy of such determination and shall have no liability for exercise
of the Warrants that are not in compliance with the Beneficial Ownership Limitation. 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 6(b), in determining the number of outstanding shares of Common Stock, the Holder may rely on
the number of outstanding shares of Common Stock as reflected in (A) the Company’s most recent periodic or annual report filed
with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by
the Company or the Company’s transfer agent setting forth the number of shares of Common Stock outstanding. Upon the written request
of the Holder, the Company shall within three trading days confirm in writing to the Holder the number of shares of Common Stock then
outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion
or exercise of securities of the Company, including the Warrants, by the Holder or its affiliates since the date as of which such number
of outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation” shall be 9.99% of the number of
shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock issuable upon exercise
of the Warrants. Any such increase or decrease will not be effective until the 61st day after such notice is delivered to the Company.
The provisions of this Section 6(b) shall be construed and implemented in a manner otherwise than in strict conformity with the terms
of this Section 6(b) to correct this Section 6(b) (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 Section 6(b) shall apply to a successor holder of the Warrants.
7.
CERTIFICATE OF ADJUSTMENT. Whenever the Exercise Price
or number or type of securities issuable upon exercise of Warrants is adjusted, as herein provided, the Company shall, at its expense,
promptly deliver to the Holder a certificate of an officer of the Company setting forth the nature of such adjustment and showing in
detail the facts upon which such adjustment is based.
8.
COMPLIANCE WITH SECURITIES LAWS.
(a)
The Holder understands that the Warrants and the Warrant Shares are characterized as “restricted securities” under the federal
securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that under
such laws and applicable regulations the Warrants and the Warrant Shares may be resold without registration under the Securities Act
only in certain limited circumstances. In this connection, the Holder represents that it is familiar with Rule 144 under the Securities
Act, as presently in effect, and understands the resale limitations imposed thereby and by the Securities Act.
(b)
Prior and as a condition to the sale or transfer of the Warrant Shares issuable upon exercise of the Warrants, the Holder shall furnish
to the Company such certificates, representations, agreements and other information as the Company or the Company’s transfer agent
reasonably may require to confirm that such sale or transfer is being made pursuant to an exemption from, or in a transaction not subject
to, the registration requirements of the Securities Act, unless such Warrant Shares are being sold or transferred pursuant to an effective
registration statement.
(c)
The Holder acknowledges that the Company may place a restrictive legend on the Warrant Shares issuable upon exercise of the Warrants
in order to comply with applicable securities laws, unless such Warrant Shares are otherwise freely tradable under Rule 144 of the Securities
Act.
9.
REPLACEMENT OF WARRANTS. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant Certificate and, in the case of any such loss,
theft or destruction of this Warrant Certificate, on delivery of an indemnity agreement reasonably satisfactory in form and amount to
the Company or, in the case of any such mutilation, on surrender and cancellation of such Warrant, the Company at its expense will execute
and deliver, in lieu thereof, a new Warrant Certificate of like tenor.
10.
NO IMPAIRMENT. Except to the extent as may be waived
by the Holder, the Company will not, by amendment of its charter or through a Change of Control, dissolution, sale of assets or any other
voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant Certificate, but will at all
times in good faith assist in the carrying out of all such terms and in the taking of all such action as may be necessary or appropriate
in order to protect the rights of the Holder against impairment.
11.
TRADING DAYS. If the last or appointed day for the taking
of any action or the expiration of any right required or granted herein shall be other than a day on which the Common Stock is traded
on The Nasdaq Capital Market, or, if The Nasdaq Capital Market is not the principal trading market for the Common Stock, then on the
principal securities exchange or securities market on which the Common Stock is then traded, then such action may be taken or such right
may be exercised on the next succeeding day on which the Common Stock is so traded.
12.
TRANSFERS; EXCHANGES. (a) Subject to compliance with
applicable federal and state securities laws and Section8 hereof, this Warrant Certificate may be transferred by the Holder with
respect to any or all of the Warrant Shares purchasable hereunder. For a transfer of this Warrant Certificate as an entirety by the Holder,
upon surrender of this Warrant Certificate to the Company, together with the Notice of Assignment in the form attached hereto as Exhibit
B duly completed and executed on behalf of the Holder, the Company shall issue a new Warrant of the same denomination to the assignee.
For a transfer of this Warrant Certificate with respect to a portion of the Warrant Shares purchasable hereunder, upon surrender of this
Warrant Certificate to the Company, together with the Notice of Assignment in the form attached hereto as Exhibit B duly completed
and executed on behalf of the Holder, the Company shall issue a new Warrant Certificate to the assignee, in such denomination as shall
be requested by the Holder, and shall issue to the Holder a new Warrant Certificate covering the number of shares in respect of which
this Warrant Certificate shall not have been transferred.
(b)
This Warrant Certificate is exchangeable, without expense, at the option of the Holder, upon presentation and surrender hereof to the
Company for other warrants of different denominations entitling the holder thereof to purchase in the aggregate the same number of shares
of Common Stock purchasable hereunder. The Warrants may be divided or combined with other warrants that carry the same rights upon presentation
hereof at the principal office of the Company together with a written notice specifying the denominations in which new warrants are to
be issued to the Holder and signed by the Holder hereof. The term “Warrants” as used herein includes any warrants into which
this Warrant may be divided or exchanged.
13.
MISCELLANEOUS. This Warrant Certificate shall be governed
by and construed in accordance with the internal laws of the State of New York, without the application of principles of conflicts of
laws that would result in any law other than the laws of the State of New York. All notices, requests, consents and other communications
hereunder shall be in writing, shall be sent by confirmed facsimile or electronic mail, or mailed by first-class registered or certified
airmail, or nationally recognized overnight express courier, postage prepaid, and shall be deemed given when so sent in the case of facsimile
or electronic mail transmission, or when so received in the case of mail or courier, and addressed as follows: (a) if to the Company,
at Orgenesis Inc., 20271 Goldenrod Lane, Germantown, Maryland 20876, Attention: Neil Reithinger, CFO; Facsimile: (480) 659-6407, Email:
neil.r@orgenesis.com; with a copy to (which shall not constitute notice) Pearl Cohen Zedek Latzer Baratz, LLP, 7 Times Square, New York,
New York 10036; Attention: Mark Cohen, Esq.; Facsimile: (646) 878-0801, E-Mail: MCohen@pearlcohen.com and (b) if to the Holder, at [●]
or at such other address or addresses (including copies to counsel) as may have been furnished by the Holder to the Company in writing.
The invalidity or unenforceability of any provision hereof shall in no way affect the validity or enforceability of any other provisions.
[Signature
Page Follows]
IN
WITNESS WHEREOF, this Warrant Certificate is issued effective as of the date first set forth above.
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ORGENESIS
INC. |
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Name: |
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Title: |
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Signature
Page to Warrant No. 202[●]-«Warrant No»
EXHIBIT
A
NOTICE
OF EXERCISE
(To
be signed only upon exercise of Warrant)
To:
Orgenesis Inc.
The
undersigned, the Holder of the attached Warrant Certificate, hereby irrevocably elects to exercise the purchase right represented by
such Warrant Certificate for, and to purchase thereunder, __________________________ (________) shares of Common Stock of Orgenesis
Inc. and (choose one) __________ herewith makes payment of ___________________________ Dollars ($_________) thereof or __________
elects to Net Exercise the Warrant pursuant to Section 1(b)(2) thereof.
The
undersigned requests that the certificates or book entry position evidencing the shares to be acquired pursuant to such exercise be issued
in the name of, and delivered to __________________________________________, whose address is ____________________________________________________________________________________________________.
By
its signature below the undersigned hereby represents and warrants that it is an “accredited investor” as defined in Rule
501(a) of Regulation D promulgated under the Securities Act of 1933, as amended, and agrees to be bound by the terms and conditions of
the attached Warrant as of the date hereof, including Section 8 thereof.
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(Signature
must conform in all |
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respects
to name of the Holder |
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specified on the face of the |
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Warrant
Certificate) |
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«XXXXXXXXXX» |
EXHIBIT
B
NOTICE
OF ASSIGNMENT FORM
FOR
VALUE RECEIVED, _________________ (the “Assignor”) hereby sells, assigns and transfers all of the rights of the undersigned
Assignor under the attached Warrant Certificate with respect to the number of shares of common stock of Orgenesis Inc., a Nevada corporation
(the “Company”) covered thereby set forth below, to the following “Assignee” and, in connection
with such transfer, represents and warrants to the Company that the transfer is in compliance with Section 8 of the Warrant and
applicable federal and state securities laws:
| NAME
OF ASSIGNEE |
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ADDRESS/FAX
NUMBER |
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of shares: |
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Signature: |
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Witness: |
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ASSIGNEE
ACKNOWLEDGMENT
The
undersigned Assignee acknowledges that it has reviewed the attached Warrant Certificate and by its signature below it hereby represents
and warrants that it is an “accredited investor” as defined in Rule 501(a) of Regulation D promulgated under the Securities
Act of 1933, as amended, and agrees to be bound by the terms and conditions of the Warrant as of the date hereof, including Section
8 thereof.
Exhibit
10.2
Execution
Version
CONVERTIBLE
LOAN AGREEMENT
THIS
CONVERTIBLE LOAN AGREEMENT (this “Agreement”) is made as of the 10th day of January, 2023 (“Effective Date”),
by and among the lender listed on Exhibit A hereto (“Lender”) and Orgenesis Inc. (“Borrower”
or “Orgenesis”) and together with the Lender, each a “Party” and together the “Parties”).
WHEREAS,
the Lender desires to lend to the Borrower, and the Borrower desires to receive from the Lender, an aggregate amount of US$ 1,000,000
(the “Loan Amount”) pursuant to the terms set forth herein;
NOW,
THEREFORE, in consideration of the premises and the mutual covenants herein contained, and other good and valuable consideration the
receipt and sufficiency of which is hereby acknowledged, the Parties hereby agree as follows:
| (a) | Terms
of Loan. The Lender shall lend to the Borrower, and the Borrower shall borrow from the
Lender, the Loan Amount. The Loan Amount shall bear a simple interest rate of eight percent
(8%) per annuum (based upon a 365-day year); provided, that if an Event of Default
has occurred and is continuing, the Outstanding Amount shall bear interests at the Default
Rate. The Loan Amount, and all accrued but unpaid interest thereon (collectively, the “Outstanding
Amount”), at the discretion of the applicable Lender shall either (i) be repaid
in cash or (ii) convert to shares of common stock, par value $0.0001 per share, of the Borrower
(“Common Stock”) on the third anniversary of the Effective Date (the “Maturity
Date”). The Maturity Date may be extended by the Lender upon the written consent
of the Lender. The Outstanding Amount may be prepaid by the Borrower in whole or in part
at any time with the prior approval of the Lender. |
| (b) | Conditions
Precedent. The obligations of the Lender to fund the Loan Amount shall not become effective
until the date on which each of the following conditions is satisfied (or waived by the Lender),
and the Parties agree that each of the following conditions precedent (“Conditions
Precedent”) have been satisfied or waived. |
| i. | The
Lender shall have received all fees and other amounts due and payable on or prior to the
Closing, including, to the extent invoiced, reimbursement or payment for reasonable out-of-pocket
expenses required to be reimbursed or paid by Borrower, which shall not exceed $150,000. |
| ii. | The
Lender shall have received a certificate of the secretary of Borrower setting forth (i) resolutions
of the board of directors of Borrower (the “Board”) with respect to the
authorization of the Borrower to execute and deliver this Agreement, the Warrants (as defined
below) and any additional agreement or instrument contemplated thereby (the “Transaction
Documents”), (ii) the individuals who are authorized to sign the Transaction Documents,
(iii) specimen signatures of such authorized individuals, and (iv) the articles of incorporation
and bylaws of Borrower, in each case, certified as being true and complete. The Lender may
conclusively rely on such certificate until the Lender receives notice in writing from Borrower
to the contrary. |
| iii. | The
Lender shall have received a certificate from the Chief Financial Officer of Borrower certifying
(1) that the representations and warranties of Borrower set forth in this Agreement are true
and correct in all respects as of the Effective Date, and (2) no event has occurred and is
continuing, or would result from the loans to be made on the Effective Date from the Lender
or from the application of the proceeds therefrom, that constitutes an Event of Default. |
| iv. | The
Lender shall have received (i) a copy of a certificate of the Nevada Secretary of State with
respect to the existence and good standing of Borrower, and (ii) copies of certificates of
the Texas Secretary of State and Maryland Secretary of State with respect to the existence,
qualification (as applicable) and good standing of the applicable operating subsidiary of
Borrower in each such State. |
| v. | The
Lender shall have received the Warrants to Purchase Shares of Common Stock of Borrower, in
substantially the form attached hereto as Exhibit B (the “Warrant”),
duly executed by Borrower. |
| vi. | The
Lender shall have received an opinion of Pearl Cohen Zedek Latzer Baratz LLP, in form and
substance satisfactory to the Lender, as to such matters incident to this Agreement as the
Lender may reasonably request. |
| vii. | Borrower
shall have submitted a Listing Of Additional Shares Notification Form to The Nasdaq Capital
Market with respect to the shares of Common Stock issuable upon conversion of the Outstanding
Amount (as set forth in Section 2 below) or upon any exercise of the Warrant. |
| viii. | Each
Party shall have received from each party counterparts of the Transaction Documents duly
signed on behalf of each party. |
| (c) | Closing.
The closing of the transactions contemplated by this Agreement shall take place following
the satisfaction or waiver of the Conditions Precedent set forth in Section 1(b) above
on or after the Effective Date, or such other date, time and place as the Lender and the
Borrower shall agree upon in writing (the “Closing”). At the Closing,
the Lender shall pay or deliver an amount equal to the Loan Amount to Borrower, by wire transfer
of immediately available funds in accordance with wire instructions provided to Lender by
Borrower prior to the Effective Date. |
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2. |
Conversion of
Loan Amount. |
| (a) | The
Outstanding Amount, shall be convertible as follows: |
| i. | Optional
Conversion. At the option of the Lender, at the Maturity Date or at any time and from
time to time, the Outstanding Amount shall be convertible, in whole or in part, into the
number of shares of Common Stock equal to the quotient obtained by dividing (x) the Outstanding
Amount by (y) the Conversion Price. The “Conversion Price” shall be a
price per share of Common Stock equal to $2.464, which is a ten percent (10%) premium to
the closing price of the Common Stock on The Nasdaq Capital Market on the trading day immediately
preceding the Effective Date; subject to adjustment as provided herein. Any Lender may effect
one or more conversions by delivering to the Borrower a written notice (each, a “Notice
of Conversion”), specifying therein the Loan Amount and accrued interest, if any,
to be converted, and the date on which such conversion shall be effected (such date, the
“Conversion Date”). If no Conversion Date is specified in a Notice of
Conversion, the Conversion Date shall be the date that such Notice of Conversion is deemed
delivered hereunder. Following the applicable Conversion Date, a Conversion completed pursuant
to this Section 2(a)(i) shall have the effect of reducing the Outstanding Amount in
amount equal to the Loan Amount set forth in the corresponding Notice of Conversion. The
Parties shall maintain records showing the total Outstanding Amount converted and the date
of each such Conversion. |
| ii. | Conversion
upon a Change of Control. In the case of a Change of Control where the Common Stock remains
outstanding, the Outstanding Amount shall automatically convert into shares of Common Stock
at the Conversion Price (the “Conversion Consideration”) at the effective
time of such Change of Control. |
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| | | In
the case of a Change of Control pursuant to which shares of Common Stock will be converted into cash, securities or other property or
assets (including any combination thereof) of another entity (the “Alternative Form Consideration”), the Lender shall
receive upon conversion of the Outstanding Amount the kind and amount of Alternative Form Consideration which the Lender would have owned
or been entitled to receive upon the Change of Control had the Lender held a number of shares of Common Stock equal to the Conversion
Consideration immediately prior to the effective time of such Change of Control. |
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| | | For purposes of this section, a “Change of Control” shall mean (1) the consummation of a merger, consolidation or similar
transaction approved by the Board in which 50% or more of the outstanding shares of Common Stock are exchanged for securities, cash or
other consideration issued or paid, or caused to be issued or paid, by the acquiring company or its affiliates, (2) the consummation
of a tender offer for, or other acquisition of, Common Stock or other convertible securities, in which an individual, corporation, partnership,
limited liability company, joint venture, trust or unincorporated organization or a government or agency or political subdivision thereof
(a “Person”) or group (as such term is defined in Rule 13d-5 under the Securities Exchange Act of 1934, as amended
(the “Exchange Act”)) of Persons become the beneficial owner (as determined pursuant to Rule 13d-3 under the Exchange
Act), directly or indirectly, of 50% or more of the total voting power of the outstanding shares of Common Stock; or (3) the sale of
all or substantially all of the assets of the Borrower |
| iii. | Conversion
at Maturity. To the extent that the Loan Amount is not earlier repaid or converted pursuant
to the provisions of this Section 2, on the Maturity Date, the Outstanding Amount
shall be (1) payable in cash, or (2) convertible into shares of Common Stock of Borrower
at the Conversion Price, in each case at the option of the Lender. |
| iv. | Mandatory
Conversion. In the event the closing price of the Common Stock on The Nasdaq Capital
Market (or other national stock exchange or market on which the Common Stock is then listed
or quoted) equals or exceeds $15.00 per share (which amount may be adjusted for certain capital
events, such as stock splits, as described herein) for ten (10) consecutive trading days
(a “Conversion Event”), then the Lender must convert the Outstanding Amount
into shares of Common Stock at the Conversion Price. Borrower shall notify the Lender of
a Conversion Event and the Lender shall convert the Outstanding Amount within five (5) days
from receipt of notice of a Conversion Event from Borrower. |
| v. | Mandatory
Exercise of Warrants. All Warrants issued to the Lender in connection with this Agreement
are subject to mandatory exercise wherein Borrower shall have the right to require the Lender
to exercise all or any portion of the Warrant that is still unexercised for a cash exercise
when the closing price of the Common Stock on The Nasdaq Capital Market equals or exceeds
$15.00 per share for ten consecutive trading days. Borrower may exercise its right to require
this exercise by giving the Lender written notice of the exercise through delivery of the
exercise notice. |
| (b) | In
the event the Outstanding Amount is converted pursuant to Section 2(a), the Lender
shall surrender this Agreement to Borrower and this Agreement shall be thereupon cancelled.
As soon as practicable, and at its expense, Borrower shall issue and deliver to the Lender
a certificate or certificates representing the number of shares of Common Stock to which
the Lender is entitled upon such conversion. |
| (c) | No
fractional shares shall be issued upon the conversion of any portion of the Outstanding Amount.
In the Lender’s sole discretion, Borrower shall either pay to the Lender in cash the
unconverted amount that would otherwise be converted into such factional share or interest
or round the shares of Common Stock being issued upon conversion up to the nearest whole
number. |
| (d) | The
issuance of shares of Common Stock on conversion of all or any portion of the Outstanding
Amount shall be made without charge to the Lender for any documentary stamp or similar taxes
that may be payable in respect of the issue or delivery of such shares upon conversion. |
| (e) | If
Borrower, at any time while there is an Outstanding Amount, subdivides (by any stock split,
stock dividend, recapitalization or otherwise) one or more classes of its outstanding shares
of Common Stock into a greater number of shares, the Conversion Price in effect immediately
prior to such subdivision will be proportionately reduced. If Borrower, at any time while
there is an Outstanding Amount, combines (by combination, reverse stock split or otherwise)
one or more classes of its outstanding shares of Common Stock into a smaller number of shares,
the Conversion Price in effect immediately prior to such combination will be proportionately
increased. Any adjustment under this Section 2(e) shall become effective at the close
of business on the date the subdivision or combination becomes effective, or as of the record
date of stock dividend, or in the event that no record date is fixed, upon the making of
such stock dividend. |
| 3. | Use
of Proceeds. Borrower shall use the Loan Amount and the $4,000,000 loan amount under
a convertible loan agreement with NewTech Investment Holdings, LLC on the same terms as this Agreement to (i)
redeem the Convertible Loan Agreement, dated as of May 19, 2022 between Orgenesis and Ricky
Steven Neumann, as amended by that certain Convertible Loan Extension Agreement, dated as
of October 23, 2022, by and between Orgenesis and Ricky Steven Neumann, and (ii) for general
corporate purposes. The use of proceeds from any Additional Loan Amount (as defined herein)
shall be used solely to redeem existing indebtedness (including other convertible loan agreements
entered into by Borrower prior to the Closing); provided, that $3,000,000 of such
Additional Loan Amount may be used for general corporate purposes. |
| | 4. | Covenants.
Until the Outstanding Amount has been paid in full (or converted in accordance with Section 2), Borrower covenants and agrees
with the Lender that: |
| (a) | Shares
Available. Borrower shall at all times reserve and keep available out of its authorized
and unissued shares of Common Stock, such number of shares of Common Stock as may at any
times be required for issuance upon conversion of all or any portion of the Outstanding Amount
or exercise of all or any portion of the Warrant, in each case, free from preemptive rights
or any other actual contingent purchase rights of persons other than the Lender. The Borrower
covenants that all shares of Common Stock that shall be so issuable shall, upon issuance,
be duly authorized, validly issued, fully paid and nonassessable. |
| (b) | Merger,
Consolidation and Related Events. Borrower shall not (i) become a party to a merger or
consolidation, or purchase or otherwise acquire all or a substantial part of the assets of
any Person or any shares or other evidence of beneficial ownership of any Person; provided,
that the covenant contained in this Section 4(b)(i) shall not apply to (1) any acquisition
of shares or equity interests pursuant to Borrower’s equity buy-out rights contained
in any joint venture agreement to which Borrower is or becomes a party, or (2) any merger
or consolidation where the Outstanding Amount is repaid in full; provided, further
that nothing in the foregoing Section 4(b)(i)(1) or Section 4(b)(i)(2) shall
be deemed to prohibit or impede Lender’s ability to exercise its conversion rights
in Section 2 above at any time or from time to time, (ii) dissolve or liquidate, (iii)
sell, lease, assign, transfer or otherwise dispose of substantially all of its assets, except
dispositions of inventory in the ordinary course of business, or (iv) enter into any agreement
to do any of the foregoing. |
| (c) | Corporate
Existence; Conduct of Business. Borrower will preserve and maintain its corporate existence
and all of its leases, privileges, licenses, permits, franchises, qualifications and rights
that are necessary or desirable in the ordinary conduct of its business. Except as contemplated
in transactions with the Lender and its affiliates, Borrower will continue to conduct its
primary businesses as conducted as of the date of this Agreement and to continue its operations
in such businesses. |
| (d) | Compliance
with Laws. Borrower will comply in all material respects with all applicable laws (including
all environmental laws), rules, regulations and orders of any the government of the United
States of America, any other nation or any political subdivision thereof, whether state,
local or tribal, and any agency, authority, instrumentality, regulatory body, court, central
bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative
powers or functions of or pertaining to government (“Governmental Authority”),
or arbitrator, and all agreements, contracts and instruments binding on it or affecting its
properties or business. |
| (e) | Maintenance
of Assets and Properties. Borrower will maintain its material assets and properties (including
material intellectual property) in good condition and repair. |
| (f) | Payment;
Discharge; Liens. Borrower will pay or discharge at or before maturity or before becoming
delinquent (a) all material taxes, levies, assessments and governmental charges imposed on
it or its income or profits or any of its property and (b) all lawful claims for labor, material
and supplies, which, if unpaid, might become a Lien upon any of its property; provided,
however, that Borrower shall not be required to pay or discharge any claim, tax, levy,
assessment or governmental charge (a “Tax or Claim Charge”), which is
being contested in good faith by appropriate proceedings diligently pursued, if (i) no asset
or any portion thereof or interest therein would be in any danger of sale, forfeiture or
loss by reason of the contest for such Tax or Claim Charge, and (ii) Borrower has set aside
on its books adequate reserves against such Tax or Claim Charge. |
| (g) | Debt;
Additional Loans. Borrower will not incur, create, assume or suffer to exist any new
obligations for borrowed money except: (i) the obligations arising under this Agreement and
a $4,000,000 convertible loan agreement with NewTech Investment Holdings, LLC on the same terms as this Agreement
or pursuant to any existing convertible loan agreement or other indebtedness as of the Effective
Date, which are all set forth on Schedule 4(g), (ii) subject to Borrower’s compliance
with the use of proceeds restrictions set forth in Section 3 above, additional convertible
loan agreements with one or more additional lenders, entered into no later than March 11,
2023 on substantially the same terms and conditions as this Agreement for an aggregate amount
(including the Loan Amount hereunder) of up to $15,000,000 the “Additional Loan
Amount”), (iii) accounts payable and other accrued expenses, liabilities or other
obligation to pay from time to time incurred in the ordinary course of business with respect
to which no more than ninety (90) days have elapsed since the date of invoice or that are
being contested in good faith by appropriate action and for which adequate reserves have
been maintained in accordance with generally accepted accounting principles in the United
States of America, and (iv) any indebtedness of Borrower consisting of the financing of insurance
premiums incurred in the ordinary course of business. |
| (a) | The
following shall constitute events of default (each an “Event of Default”): |
| i. | Borrower
shall fail to pay any installment of principal or interest on Loan Amount, or Additional
Loan Amount, if any, or any other sum secured hereby when due and Borrower fails to cure
such default within ten (10) days after written notice of default is sent to Borrower; |
| ii. | Any
representation or warranty made or deemed made by Borrower or any of its respective officers
in any certificate or notice furnished at any time in connection with this Agreement or any
other Transaction Document shall be false, misleading or erroneous in any material respect
when made or deemed to have been made; |
| iii. | Borrower
shall fail to perform, observe or comply with the observance or performance of any non-monetary
covenant or agreement contained herein and the Borrower fails to cure such default within
thirty (30) days after written notice of default is sent to the Borrower (or within such
other longer time period as may be therein specifically provided); |
| iv. | Borrower
shall fail to perform, observe or comply with the obligations, terms, covenants or conditions
contained in this Agreement or any other Transaction Document and such failure is not cured
within thirty (30) days from the earliest to occur of the date the Lender delivers notice
of such failure to Borrower; |
| v. | Borrower
shall (1) commence a voluntary proceeding seeking liquidation, reorganization, or other relief
with respect to its debts under any present or future federal, state or other statute, law
or regulation relating to bankruptcy, insolvency or other relief for debtors seeking the
appointment of a trustee, receiver, liquidator, custodian, or other similar official of it
or of all or any part of the assets of Borrower or its subsidiaries, or of any or all of
the royalties, revenues, rents, issues or profits thereof, (2) consent to any such relief
or to the appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, (3) make a general assignment for the benefit of
creditors or shall generally fail to pay its debts as they become due or (4) take any corporate
action to authorize any of the foregoing; |
| vi. | an
involuntary proceeding shall be commenced against Borrower seeking any liquidation, reorganization,
dissolution or similar relief under any present or future federal, state or other statute,
law or regulation relating to bankruptcy, insolvency or other relief for debtors, and such
petition shall remain undismissed and unstayed for a period of sixty (60) days (whether or
not consecutive) from the first date of entry thereof or rejected by such court; or any trustee,
receiver or liquidator of Borrower or of all or any part of the assets of Borrower or its
subsidiaries, or of any or all of the royalties, revenues, rents, issues or profits thereof,
shall be appointed without the consent or acquiescence of Borrower and such appointment shall
remain undismissed and unstayed for an aggregate of sixty (60) days (whether or not consecutive); |
| vii. | a
writ of execution or attachment or any similar process shall be issued or levied against
all or any part of or interest in the assets of Borrower or its subsidiaries, or any judgment
involving monetary damages shall be entered against Borrower which shall become a Lien on
the assets the assets of Borrower or its subsidiaries or any portion thereof or interest
therein and such execution, attachment or similar process or judgment is not released, bonded,
satisfied, vacated or stayed within sixty (60) days after its entry or levy; |
| viii. | the
Borrower ceases or threatens to cease to carry on its business; |
| ix. | this
Agreement or any other Transaction Document shall for any reason not be, or cease to be,
in full force and effect or shall be declared null and void or the validity or enforceability
thereof shall be contested or challenged by Borrower, or Borrower shall deny that it has
any further liability or obligation hereunder prior to payment in full of all obligations
hereunder; or |
| x. | the
Borrower admits its inability to pay its debts upon their falling due. |
| (b) | If
an Event of Default occurs and is ongoing, the interest on the Outstanding Amount shall increase
to a rate of fifteen percent (15.0%) per annum (the “Default Rate”). |
| (c) | If,
at any time, an Event of Default shall occur, all obligations under this Agreement shall
become immediately due and payable without presentment, demand or protest, all of which are
hereby waived by the Borrower. |
| 6. | Representations
and Warranties of Borrower. To induce the Lender to enter into this Agreement and to
fund the Loan Amount, Borrower hereby represents and warrants to the Lender (as follows: |
| (a) | Organization;
Powers. Borrower is duly formed, validly existing and in good standing under the laws
of the State of Nevada. Borrower has the full power and authority to own its assets and to
carry on its business as now conducted, and is qualified to do business in, and is in good
standing in, every jurisdiction where such qualification is required, except where failure
to have such power, authority and qualifications could not reasonably be expected to have
a Material Adverse Effect. |
| | | |
| | | For
purposes of this Agreement, a “Material Adverse Effect” means a material adverse change in, or material adverse effect
on, (i) the business, operations, property, liabilities (actual or contingent) or condition (financial or otherwise) of Borrower, (ii)
the ability of Borrower to perform any of its obligations under any Transaction Document to which it is a party, (iii) the validity or
enforceability of any Transaction Document or (d) the rights and remedies of or benefits available to the Lender under any Transaction
Document. |
| (b) | Authority;
Enforceability. Borrower has the power and authority to consummate the transactions contemplated
in this Agreement and in each other Transaction Document (the “Transactions”).
When executed and delivered, each Transaction Document will have been duly executed and delivered
by Borrower and will constitute a legal, valid and binding obligation of Borrower, enforceable
in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting creditors’ rights generally and subject to general
principles of equity, regardless of whether considered in a proceeding in equity or at law. |
| (c) | Approvals;
No Conflicts. The consummation of the Transactions (1) do not require any consent, license,
or approval of, registration or filing with, or any other action by, any Governmental Authority
or any other third Person, except such as have been obtained or made and are in full force
and effect, (2) will not violate the provisions of any applicable law, (3) will not violate
or result in a default under any agreement or instrument to which the Borrower is a party
or under which any properties or assets of Borrower or its subsidiaries are bound, and (4)
will not result in the creation or imposition of any Lien on any property or asset of Borrower
or its subsidiaries. |
| (d) | Litigation.
Except as set forth in Borrower’s filings with the U.S. Securities and Exchange Commission,
there are no actions, suits, investigations or proceedings by or before any arbitrator or
Governmental Authority pending against or, to the knowledge of Borrower, threated against
or affect Borrower or any of its subsidiaries that (a) could reasonably be expected to be
adversely determined and, if so determined, could reasonably be expected individually or
in the aggregate, to result in a Material Adverse Effect, or (b) involve any Transaction
Document or the Transactions. |
| (e) | Investment
Company Act. Neither Borrower nor any of its subsidiaries is an “investment company”
or a company “controlled” by an “investment company,” within the
meaning of, or subject to regulation under, the Investment Company Act of 1940, as amended. |
| 7. | Representations
and Warranties of Lender. Lender hereby represents and warrants to Borrower as follows: |
| (a) | Due
Execution. When executed and delivered, each Transaction Document will have been duly
executed and delivered by the Lender and will constitute a legal, valid and binding obligation
of the Lender, enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally
and subject to general principles of equity, regardless of whether considered in a proceeding
in equity or at law. |
| 8. | Waiver;
Non-Negotiable. Borrower, for itself and each of its legal representatives, hereby waives
presentment for payment, demand, right of setoff, notice of nonpayment, notice of dishonor,
protest of any dishonor, notice of protest and protest of this Agreement, and all other notices
in connection with the delivery, acceptance, performance, default or enforcement of the obligations
under this Agreement. This Agreement is non-negotiable. |
| 9. | Further
Assurances. The Parties shall perform such further acts and execute such further documents
as may reasonably be necessary to carry out and give full effect to the provisions of this
Agreement. |
| (a) | Entire
Agreement; Amendments. This Agreement and each of the Transaction Documents constitutes
the entire understanding of the Parties hereto with respect to the subject matter hereof
and supersedes all prior written and oral understandings of such parties with regard thereto.
This Agreement may be modified, amended, or any term hereof waived with the written consent
of the Borrower and the Lender. Any amendment effected in accordance with this Section
10(a) shall be binding upon all Parties and their respective successors and assignees. |
| (b) | Governing
Law; Jurisdiction. This Agreement shall be governed by and construed according to the
laws of the State of New York without regard to the conflict of laws provisions thereof.
Any dispute arising under or in relation to this Agreement shall be resolved in the competent
courts of the State of New York or of the United States of America for the Southern District
of New York, in either case, located in New York County, New York, and each of the Parties
hereby submits irrevocably to the jurisdiction of such courts. Each Party hereby irrevocably
waives any objection, including, without limitation, any objection to the laying of venue
or based on the grounds of forum non conveniens, which it may now or hereafter have to the
bringing of any such action or proceeding in such respective jurisdictions. |
| (c) | Waiver
of Jury Trial. Each Party hereby irrevocably and unconditionally waives, to the fullest
extent permitted by law, trial by jury in any legal action or proceeding relating to this
Agreement or any other Transaction Document and for any counterclaim therein. |
| (d) | Notices.
All notices and other communications required or permitted hereunder to be given to a Party
to this Agreement shall be in writing and shall be telecopied or mailed by registered or
certified mail, postage prepaid, or otherwise delivered by hand or by messenger. Any notice
sent in accordance with this Agreement shall be effective (i) if mailed, seven (7) business
days after mailing to the address set forth each Party’s signature below, (ii) if sent
by messenger, upon delivery, and (iii) if sent via telecopier, upon transmission and electronic
confirmation of receipt or (if transmitted and received on a non-business day) on the first
business day following transmission and electronic confirmation of receipt. Additionally,
a copy of each notice sent or delivered to (1) the Borrower (which does not constitute a
notice) shall be sent or delivered to Mark Cohen, Esq., c/o Pearl Cohen Zedek Latzer Baratz
LLP, Times Square Tower, 7 Times Square, New York, NY 10036, and (2) the Lender (which does
not constitute a notice) shall be sent or delivered to Ariel Malik, No 18 Hameyased Street, Hod HaSharon, Israel 45220. |
| (e) | Assignment;
Waiver. This Agreement may not be assigned by the Borrower without the prior written
consent of the Lender. The Lender may assign this Agreement without the prior written consent
of the Borrower. This Agreement shall be binding upon the successors, assigns and representatives
of each Party. No delay or omission to exercise any right, power, or remedy accruing to any
Party upon any breach or default under this Agreement, shall be deemed a waiver of any other
breach or default theretofore or thereafter occurring. All remedies, either under this Agreement
or by law or otherwise afforded to any of the Parties, shall be cumulative and not alternative. |
| (f) | Severability.
If any provision of this Agreement is held by a court of competent jurisdiction to be unenforceable
under applicable law, then such provision shall be excluded from this Agreement and the remainder
of this Agreement shall be interpreted as if such provision were so excluded and shall be
enforceable in accordance with its terms; provided, however, that in such event this Agreement
shall be interpreted so as to give effect, to the greatest extent consistent with and permitted
by applicable law, to the meaning and intention of the excluded provision as determined by
such court of competent jurisdiction. |
| (g) | Counterparts.
This Agreement may be executed in any number of counterparts, each of which shall be deemed
an original but all of which together shall constitute one and the same instrument. |
| (h) | Headings.
Section headings are used herein for convenience and reference only, are not party of this
Agreement and shall not affect the construction of, or be taken into consideration in interpreting,
this Agreement. |
[Remainder
of Page Intentionally Left Blank]
IN
WITNESS WHEREOF, the Parties have executed this Convertible Loan Agreement as of the date first above written.
| “BORROWER” |
|
| |
|
| ORGENESIS
INC. |
|
| |
|
|
| By: |
/s/
Vered Caplan |
|
| Name: |
Vered Caplan |
|
| Title: |
Chief Executive Officer |
|
| Address: |
20271 Goldenrod Lane |
|
| |
Germantown,
Maryland, 20776 USA |
|
| |
|
|
| “LENDER” |
|
| |
|
| /s/
Ariel Malik |
|
| Name: |
Ariel Malik |
|
| Address: |
No 18 Hameyased Street |
|
| |
Hod HaSharon, Israel 45220 |
|
EXHIBIT
A
| Name
of Lender |
|
Loan
Amount |
|
Date |
| Ariel Malik |
|
$
1,000,000 |
|
January
10, 2023 |
EXHIBIT
B
FORM
OF WARRANT
[see
attached]
THIS
WARRANT CERTIFICATE AND THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT
REQUIRED UNDER SUCH ACT OR UNLESS SOLD IN ACCORDANCE WITH RULE 144 UNDER SUCH ACT.
| WARRANT
CERTIFICATE NO. 2023-[●] |
|
NUMBER
OF WARRANTS: [●] |
| DATE
OF ISSUANCE: [●] |
|
|
| INITIAL
EXERCISE DATE: [●] |
|
(subject
to adjustment hereunder) |
| EXPIRATION
DATE: [●], 202[●] |
|
|
WARRANTS
TO PURCHASE SHARES
OF
COMMON STOCK OF
ORGENESIS
INC.
This
Warrant Certificate (this “Warrant Certificate”) represents [●] warrants to purchase shares of Common Stock
(as defined below) and is issued to [●], or its registered assigns (including any successors or assigns, the “Holder”),
pursuant to that certain Convertible Loan Agreement, dated as of [●] (the “Loan Agreement”), among Orgenesis
Inc., a Nevada corporation (the “Company”), the Holder and [●].
1.
EXERCISE OF WARRANT.
(a)
Number and Exercise Price of Warrant Shares; Expiration Date. Subject to the terms and conditions set forth herein, the Holder
is entitled to purchase from the Company up to [●] shares of the Company’s Common Stock, $0.0001 par value per share (the
“Common Stock”) (as adjusted from time to time pursuant to the provisions of this Warrant Certificate) (the “Warrant
Shares”), at a purchase price of $2.50 per share (as adjusted from time to time pursuant to the provisions of this Warrant,
the “Exercise Price”), at any time on or after [●] (the “Initial Exercise Date”) and on or
before 5:00 p.m. New York City time on [●] (the “Expiration Date”) (subject to earlier termination of this Warrant
Certificate as set forth herein).
(b)
Method of Exercise. While this Warrant Certificate remains outstanding and exercisable in accordance with Section 1(a) above,
the Holder may exercise any or all of the Warrants represented by this Warrant Certificate by surrendering this Warrant Certificate at
the principal office of the Company and paying the Exercise Price of the Warrants to be exercised hereunder by either:
(1)
wire transfer to the Company or cashier’s check drawn on a United States bank made payable to the order of the Company, or
(2)
if there is no effective registration statement registering, or no current prospectus available for, the resale of the Warrant Shares
by the Purchaser, exercising of the right to credit the Exercise Price against the Fair Market Value of the Warrant Shares (as defined
below) at the time of exercise (the “Net Exercise”) pursuant to Section 1(c).
(c)
Net Exercise. If the Company shall receive written notice from the Holder at the time of exercise of Warrants hereunder that the
Holder elects to Net Exercise such Warrants, the Company shall deliver to such Holder (without payment by the Holder of any exercise
price in cash) that number of Warrant Shares computed using the following formula:
Where
| |
X
= |
The
number of Warrant Shares to be issued to the Holder. |
| |
|
|
| |
Y
= |
The
number of Warrant Shares purchasable based on the number of Warrants being exercised. |
| |
|
|
| |
A
= |
The
Fair Market Value of one (1) share of Common Stock (at the date of such calculation). |
| |
|
|
| |
B
= |
The
Exercise Price (as adjusted to the date of such calculations). |
The
“Fair Market Value” of one share of Common Stock shall mean (x) the closing price of the Common Stock on the business
day prior to the date of exercise on The Nasdaq Capital Market as reported by Bloomberg Financial Markets (or a comparable reporting
service of national reputation selected by the Company and reasonably acceptable to the holder if Bloomberg Financial Markets is not
then reporting sales prices of the Common Stock) (collectively, “Bloomberg”) or (y) or if the foregoing does not apply,
the last sales price of the Common Stock in the over-the-counter market on the pink sheets or bulletin board for such security as reported
by Bloomberg, and, if there are no sales, the last reported bid price of the Common Stock as reported by Bloomberg or, if the Fair Market
Value cannot be calculated as of such date on either of the foregoing bases, the price determined in good faith by the board of directors
of the Company.
2.
CERTAIN ADJUSTMENTS.
(a)
Adjustment of Number of Warrant Shares and Exercise Price. The number of shares of Common Stock issuable upon the exercise of
each Warrant represented by this Warrant Certificate (the “Warrant Number”) is initially one. The Warrant Number and kind
of Warrant Shares purchasable upon exercise of each Warrant and the Exercise Price shall be subject to adjustment from time to time as
follows:
(1)
Subdivisions, Combinations and Other Issuances. If the Company shall at any time after the Date of Issuance but prior to the Expiration
Date subdivide its shares of capital stock of the same class as the Warrant Shares, by split-up or otherwise, or combine such shares
of capital stock, or issue additional shares of capital stock as a dividend with respect to any shares of such capital stock, the Warrant
Number shall forthwith be proportionately increased in the case of a subdivision or stock dividend, or proportionately decreased in the
case of a combination. Appropriate adjustments shall also be made to the Exercise Price payable per share, but the aggregate Exercise
Price payable for the total number of Warrant Shares purchasable under all Warrants initially represented by this Warrant Certificate
(as adjusted) shall remain the same. Any adjustment under this Section 2(a)(1) shall become effective at the close of business on the
date the subdivision or combination becomes effective, or as of the record date of such dividend, or in the event that no record date
is fixed, upon the making of such dividend.
(2)
Adjustments for Other Dividends and Distributions. In the event the Company at any time or from time to time after the Date of
Issuance shall make or issue, or fix a record date for the determination of holders of Common Stock entitled to receive, a dividend or
other distribution payable in securities of the Company (other than shares of Common Stock) or in cash or other property, then and in
each such event provision shall be made so that the Holder shall receive upon exercise hereof, in addition to the number of shares of
Common Stock issuable hereunder, the kind and amount of securities of the Company, cash or other property that the Holder would have
been entitled to receive had all Warrants represented by this Warrant Certificate been exercised on the date of such event and had the
Holder thereafter, during the period from the date of such event to and including the Exercise Date, retained any such securities receivable
during such period, giving application to all adjustments called for during such period under this Section 2 with respect to the rights
of the Holder.
(3)
Reorganizations or Mergers. In case of any reclassification, capital reorganization or change in the capital stock of the Company
(other than as a result of a subdivision, combination or stock dividend provided for in Section 2(a)(1) above) that occurs after
the Date of Issuance, then, as a condition of such reclassification, reorganization or change, lawful provision shall be made, and duly
executed documents evidencing the same from the Company or its successor shall be delivered to the Holder, so that the Holder shall thereafter
have the right at any time prior to the expiration of the Warrants represented by this Warrant Certificate to purchase, at a total price
equal to that payable upon the exercise of the Warrants represented by this Warrant Certificate, the kind and amount of shares of stock
and/or other securities or property (including, if applicable, cash) receivable in connection with such reclassification, reorganization
or change by a holder of the same number and type of securities as were purchasable as Warrant Shares by the Holder immediately prior
to such reclassification, reorganization or change. In any such case appropriate provisions shall be made with respect to the rights
and interest of the Holder so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other
securities or property deliverable upon exercise hereof, and appropriate adjustments shall be made to the Exercise Price payable hereunder,
provided the aggregate Exercise Price shall remain the same (and the Warrants shall be exclusively exercisable for such shares of stock
and/or other securities or property from and after the consummation of such reclassification or other change in the capital stock of
the Company).
(b)
Notice to Holder. If, while any Warrant is outstanding, the Company (i) declares a dividend or any other distribution of cash,
securities or other property in respect of its Common Stock, including, without limitation, any granting of rights or warrants to subscribe
for or purchase any capital stock of the Company or any subsidiary, (ii) authorizes or approves, enters into any agreement contemplating
or solicits stockholder approval for any Change of Control or (iii) authorizes the voluntary dissolution, liquidation or winding up of
the affairs of the Company, then the Company shall deliver to a holder a notice of such transaction at least 15 business days prior to
the applicable record or effective date on which a person would need to hold Common Stock in order to participate in or vote with respect
to such transaction; provided, however, that the failure to deliver such notice or any defect therein shall not affect the validity of
the corporate action required to be described in such notice.
(c)
Calculations. All calculations under this Section 2 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 2, the number of shares of Common Stock deemed to be issued and outstanding as
of a given date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.
(d)
Treatment of Warrant upon a Change of Control.
(1)
In the event of a Change of Control in which the consideration to be received by the Company’s stockholders consists solely of
cash, solely of Marketable Securities (as defined below) or a combination of cash and Marketable Securities (a “Cash/Public
Change of Control”), if any Warrant is outstanding upon the consummation of such Cash/Public Change of Control then (i) if
the Fair Market Value of one share of Common Stock (as determined in accordance with Section 1(c)) is greater than the then applicable
Exercise Price, the Warrants may be exercised at the election of the Holder on a net exercise issue basis pursuant to Section 1(c)
as of immediately prior to such Cash/Public Change of Control and (ii) if the Fair Market Value of one share of Common Stock (as
determined in accordance with Section 1(c)) is less than or equal to the then applicable Exercise Price, the Warrants will expire
immediately prior to the consummation of such Change of Control; provided that during the term of the Warrants, each of the Company’s
outstanding warrants will be treated in the same manner as above subject to the terms of such outstanding warrants existing on the Date
of Issuance.
(2)
If, at any time while any of the Warrants is outstanding, the Company consummates a Change of Control that is not a Cash/Public Change
of Control, then a Holder shall have the right thereafter to receive, upon exercise of a Warrant, the same amount and kind of securities,
cash or property as it would have been entitled to receive upon the occurrence of such Change of Control if it had been, immediately
prior to such Change of Control, a holder of the number of Warrant Shares then issuable upon exercise in full of the Warrant (the “Alternate
Consideration”). The Company shall not effect any such Change of Control unless prior to or simultaneously with the consummation
thereof, any successor to the Company, surviving entity or the corporation purchasing or otherwise acquiring such assets or other appropriate
corporation or entity shall assume the obligation to deliver to the Holder, such Alternate Consideration as, in accordance with the foregoing
provisions, the Holder may be entitled to purchase, and the other obligations under this Warrant Certificate.
(3)
As used in this Warrant Certificate, a “Change of Control” shall mean (i) a merger or consolidation of the Company
with another corporation (other than a merger effected exclusively for the purpose of changing the domicile of the Company), (ii) the
sale, assignment, transfer, conveyance or other disposal of all or substantially all of the properties or assets or all or a majority
of the outstanding voting shares of capital stock of the Company, (iii) a purchase, tender or exchange offer accepted by the holders
of a majority of the outstanding voting shares of capital stock of the Company, or (iv) a “person” or “group”
(as these terms are used for purposes of Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”)) is or shall become the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly at least a majority of the voting power of the capital stock of the Company.
(4)
As used in this Warrant Certificate, “Marketable Securities” means securities meeting all of the following requirements:
(i) the issuer thereof is then subject to the reporting requirements of Section 13 or Section 15(d) of the Securities Exchange Act, and
is then current in its filing of all required reports and other information under the Securities Act of 1933, as amended (the “Securities
Act”), and the Exchange Act; (ii) the class and series of shares or other security of the issuer that would be received by
the Holder in connection with the Change of Control were the Holder to exercise the Warrants on or prior to the closing thereof is then-traded
or quoted on a nationally recognized securities exchange, inter-dealer quotation system or over-the-counter market, and (iii) following
the closing of such Change of Control, the Holder would not be restricted from publicly re-selling all of the issuer’s shares and/or
other securities that would be received by the Holder in such Change of Control were the Holder to exercise or convert the Warrants in
full on or prior to the closing of such Change of Control, except to the extent that any such restriction (x) arises solely under federal
or state securities laws, rules or regulations, and (y) does not extend beyond six months from the closing of such Change of Control.
3.
NO FRACTIONAL SHARES. No fractional Warrant Shares or
scrip representing fractional shares will be issued upon exercise of any Warrant. In lieu of any fractional shares which would otherwise
be issuable, the Company shall pay cash equal to the product of such fraction multiplied by the Fair Market Value of one Warrant Share.
4.
NO STOCKHOLDER RIGHTS. Until the exercise of a Warrant,
the Holder shall not have, nor exercise, any rights as a stockholder of the Company (including without limitation the right to notification
of stockholder meetings or the right to receive any notice or other communication concerning the business and affairs of the Company)
except as provided in Section 9 below.
5.
RESERVATION OF STOCK. The Company covenants that during
the period the Warrants are exercisable, the Company will reserve from its authorized and unissued Common Stock a sufficient number of
shares of Common Stock (or other securities, if applicable) to provide for the issuance of Warrant Shares (or other securities) upon
the exercise of the Warrants.
6.
MECHANICS OF EXERCISE.
(a)
Delivery of Warrant Shares Upon Exercise. The Warrants may be exercised by the Holder, in whole or in part, by the surrender of this
Warrant Certificate and the Notice of Exercise attached hereto as Exhibit A duly completed and executed on behalf of the Holder, at the
principal office of the Company together with payment in full of the Exercise Price (unless the Holder has elected to Net Exercise) then
in effect with respect to the number of Warrant Shares as to which the Warrant is being exercised. The Warrants shall be deemed to have
been exercised immediately prior to the close of business on the date of surrender for exercise as provided above, and the person entitled
to receive the Warrant Shares issuable upon such exercise shall be treated for all purposes as the holder of such shares of record as
of the close of business on such date. Warrant Shares purchased hereunder shall be transmitted by the Company’s transfer agent
to the Holder by crediting the account of the Holder’s prime broker with The Depository Trust Company through its Deposit or Withdrawal
at Custodian system if the Company is then a participant in such system and either (A) there is an effective registration statement permitting
the issuance of the Warrant Shares to or resale of the Warrant Shares by the Holder or (B) the shares are eligible for resale by the
Holder without volume or manner-of-sale limitations pursuant to Rule 144, and otherwise by physical delivery to the address specified
by the Holder in the Notice of Exercise by the end of the day on the date that is three trading days from the delivery to the Company
of the Notice of Exercise, surrender of this Warrant Certificate and payment of the aggregate Exercise Price (unless exercised by means
of a cashless exercise pursuant to Section 1(c). 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 such Warrants have been exercised, with payment to the Company of the Exercise Price (or by Net Exercise) and all taxes required
to be paid by the Holder, if any, prior to the issuance of such shares, having been paid. The Company will pay all documentary stamp
taxes and other governmental charges (excluding all foreign, federal or state income, capital gains franchise, property, estate, inheritance,
gift or similar taxes) in connection with the issuance or delivery or the exercise of any Warrant.
(b)
Holder’s Exercise Limitations. The Holder shall not have the right to exercise Warrants, pursuant to Section 1 or otherwise,
to the extent that after giving effect to such issuance after exercise as set forth on the applicable Notice of Exercise, the Holder
(together with the Holder’s affiliates, and any other persons acting as a group together with the Holder or any of the Holder’s
affiliates), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing
sentence, the aggregate number of shares of Common Stock beneficially owned by the Holder and its affiliates shall include the number
of shares of Common Stock issuable upon exercise of the outstanding Warrants represented hereby with respect to which such determination
is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (i) exercise of the remaining, nonexercised
portion of the Warrants represented hereby beneficially owned by the Holder or any of its affiliates and (ii) exercise or conversion
of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation, any other convertible
notes or convertible preferred stock or warrants) subject to a limitation on conversion or exercise analogous to the limitation contained
herein beneficially owned by the Holder or any of its affiliates. Except as set forth in the preceding sentence, for purposes of this
section, 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 the Holder that the Company is not representing to the Holder that such calculation
is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible for any schedules required to be filed in
accordance therewith. To the extent that the limitation contained in this Section 6(b) applies, the determination of whether the Warrants
are exercisable (in relation to other securities owned by the Holder together with any of its affiliates) and of which portion of the
Warrants are exercisable shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to
be the Holder’s determination of whether the Warrants are exercisable (in relation to other securities owned by the Holder together
with any of its affiliates) and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation,
and the Company shall have no obligation to verify or confirm the accuracy of such determination and shall have no liability for exercise
of the Warrants that are not in compliance with the Beneficial Ownership Limitation. 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 6(b), in determining the number of outstanding shares of Common Stock, the Holder may rely on
the number of outstanding shares of Common Stock as reflected in (A) the Company’s most recent periodic or annual report filed
with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by
the Company or the Company’s transfer agent setting forth the number of shares of Common Stock outstanding. Upon the written request
of the Holder, the Company shall within three trading days confirm in writing to the Holder the number of shares of Common Stock then
outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion
or exercise of securities of the Company, including the Warrants, by the Holder or its affiliates since the date as of which such number
of outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation” shall be 9.99% of the number of
shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock issuable upon exercise
of the Warrants. Any such increase or decrease will not be effective until the 61st day after such notice is delivered to the Company.
The provisions of this Section 6(b) shall be construed and implemented in a manner otherwise than in strict conformity with the terms
of this Section 6(b) to correct this Section 6(b) (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 Section 6(b) shall apply to a successor holder of the Warrants.
7.
CERTIFICATE OF ADJUSTMENT. Whenever the Exercise Price
or number or type of securities issuable upon exercise of Warrants is adjusted, as herein provided, the Company shall, at its expense,
promptly deliver to the Holder a certificate of an officer of the Company setting forth the nature of such adjustment and showing in
detail the facts upon which such adjustment is based.
8.
COMPLIANCE WITH SECURITIES LAWS.
(a)
The Holder understands that the Warrants and the Warrant Shares are characterized as “restricted securities” under the federal
securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that under
such laws and applicable regulations the Warrants and the Warrant Shares may be resold without registration under the Securities Act
only in certain limited circumstances. In this connection, the Holder represents that it is familiar with Rule 144 under the Securities
Act, as presently in effect, and understands the resale limitations imposed thereby and by the Securities Act.
(b)
Prior and as a condition to the sale or transfer of the Warrant Shares issuable upon exercise of the Warrants, the Holder shall furnish
to the Company such certificates, representations, agreements and other information as the Company or the Company’s transfer agent
reasonably may require to confirm that such sale or transfer is being made pursuant to an exemption from, or in a transaction not subject
to, the registration requirements of the Securities Act, unless such Warrant Shares are being sold or transferred pursuant to an effective
registration statement.
(c)
The Holder acknowledges that the Company may place a restrictive legend on the Warrant Shares issuable upon exercise of the Warrants
in order to comply with applicable securities laws, unless such Warrant Shares are otherwise freely tradable under Rule 144 of the Securities
Act.
9.
REPLACEMENT OF WARRANTS. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant Certificate and, in the case of any such loss,
theft or destruction of this Warrant Certificate, on delivery of an indemnity agreement reasonably satisfactory in form and amount to
the Company or, in the case of any such mutilation, on surrender and cancellation of such Warrant, the Company at its expense will execute
and deliver, in lieu thereof, a new Warrant Certificate of like tenor.
10.
NO IMPAIRMENT. Except to the extent as may be waived
by the Holder, the Company will not, by amendment of its charter or through a Change of Control, dissolution, sale of assets or any other
voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant Certificate, but will at all
times in good faith assist in the carrying out of all such terms and in the taking of all such action as may be necessary or appropriate
in order to protect the rights of the Holder against impairment.
11.
TRADING DAYS. If the last or appointed day for the taking
of any action or the expiration of any right required or granted herein shall be other than a day on which the Common Stock is traded
on The Nasdaq Capital Market, or, if The Nasdaq Capital Market is not the principal trading market for the Common Stock, then on the
principal securities exchange or securities market on which the Common Stock is then traded, then such action may be taken or such right
may be exercised on the next succeeding day on which the Common Stock is so traded.
12.
TRANSFERS; EXCHANGES. (a) Subject to compliance with
applicable federal and state securities laws and Section8 hereof, this Warrant Certificate may be transferred by the Holder with
respect to any or all of the Warrant Shares purchasable hereunder. For a transfer of this Warrant Certificate as an entirety by the Holder,
upon surrender of this Warrant Certificate to the Company, together with the Notice of Assignment in the form attached hereto as Exhibit
B duly completed and executed on behalf of the Holder, the Company shall issue a new Warrant of the same denomination to the assignee.
For a transfer of this Warrant Certificate with respect to a portion of the Warrant Shares purchasable hereunder, upon surrender of this
Warrant Certificate to the Company, together with the Notice of Assignment in the form attached hereto as Exhibit B duly completed
and executed on behalf of the Holder, the Company shall issue a new Warrant Certificate to the assignee, in such denomination as shall
be requested by the Holder, and shall issue to the Holder a new Warrant Certificate covering the number of shares in respect of which
this Warrant Certificate shall not have been transferred.
(b)
This Warrant Certificate is exchangeable, without expense, at the option of the Holder, upon presentation and surrender hereof to the
Company for other warrants of different denominations entitling the holder thereof to purchase in the aggregate the same number of shares
of Common Stock purchasable hereunder. The Warrants may be divided or combined with other warrants that carry the same rights upon presentation
hereof at the principal office of the Company together with a written notice specifying the denominations in which new warrants are to
be issued to the Holder and signed by the Holder hereof. The term “Warrants” as used herein includes any warrants into which
this Warrant may be divided or exchanged.
13.
MISCELLANEOUS. This Warrant Certificate shall be governed
by and construed in accordance with the internal laws of the State of New York, without the application of principles of conflicts of
laws that would result in any law other than the laws of the State of New York. All notices, requests, consents and other communications
hereunder shall be in writing, shall be sent by confirmed facsimile or electronic mail, or mailed by first-class registered or certified
airmail, or nationally recognized overnight express courier, postage prepaid, and shall be deemed given when so sent in the case of facsimile
or electronic mail transmission, or when so received in the case of mail or courier, and addressed as follows: (a) if to the Company,
at Orgenesis Inc., 20271 Goldenrod Lane, Germantown, Maryland 20876, Attention: Neil Reithinger, CFO; Facsimile: (480) 659-6407, Email:
neil.r@orgenesis.com; with a copy to (which shall not constitute notice) Pearl Cohen Zedek Latzer Baratz, LLP, 7 Times Square, New York,
New York 10036; Attention: Mark Cohen, Esq.; Facsimile: (646) 878-0801, E-Mail: MCohen@pearlcohen.com and (b) if to the Holder, at [●]
or at such other address or addresses (including copies to counsel) as may have been furnished by the Holder to the Company in writing.
The invalidity or unenforceability of any provision hereof shall in no way affect the validity or enforceability of any other provisions.
[Signature
Page Follows]
IN
WITNESS WHEREOF, this Warrant Certificate is issued effective as of the date first set forth above.
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ORGENESIS
INC. |
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Name: |
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Title: |
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Signature
Page to Warrant No. 202[●]-«Warrant No»
EXHIBIT
A
NOTICE
OF EXERCISE
(To
be signed only upon exercise of Warrant)
To:
Orgenesis Inc.
The
undersigned, the Holder of the attached Warrant Certificate, hereby irrevocably elects to exercise the purchase right represented by
such Warrant Certificate for, and to purchase thereunder, __________________________ (________) shares of Common Stock of Orgenesis
Inc. and (choose one) __________ herewith makes payment of ___________________________ Dollars ($_________) thereof or __________
elects to Net Exercise the Warrant pursuant to Section 1(b)(2) thereof.
The
undersigned requests that the certificates or book entry position evidencing the shares to be acquired pursuant to such exercise be issued
in the name of, and delivered to __________________________________________, whose address is ____________________________________________________________________________________________________.
By
its signature below the undersigned hereby represents and warrants that it is an “accredited investor” as defined in Rule
501(a) of Regulation D promulgated under the Securities Act of 1933, as amended, and agrees to be bound by the terms and conditions of
the attached Warrant as of the date hereof, including Section 8 thereof.
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(Signature
must conform in all |
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respects
to name of the Holder |
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as
specified on the face of the |
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Warrant
Certificate) |
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«XXXXXXXXXX» |
EXHIBIT
B
NOTICE
OF ASSIGNMENT FORM
FOR
VALUE RECEIVED, _________________ (the “Assignor”) hereby sells, assigns and transfers all of the rights of the undersigned
Assignor under the attached Warrant Certificate with respect to the number of shares of common stock of Orgenesis Inc., a Nevada corporation
(the “Company”) covered thereby set forth below, to the following “Assignee” and, in connection
with such transfer, represents and warrants to the Company that the transfer is in compliance with Section 8 of the Warrant and
applicable federal and state securities laws:
| NAME
OF ASSIGNEE |
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ADDRESS/FAX
NUMBER |
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| Number
of shares: |
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Signature: |
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Witness: |
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ASSIGNEE
ACKNOWLEDGMENT
The
undersigned Assignee acknowledges that it has reviewed the attached Warrant Certificate and by its signature below it hereby represents
and warrants that it is an “accredited investor” as defined in Rule 501(a) of Regulation D promulgated under the Securities
Act of 1933, as amended, and agrees to be bound by the terms and conditions of the Warrant as of the date hereof, including Section
8 thereof.