EXHIBIT 10.2

 

THIS WARRANT AND THE COMMON SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THIS WARRANT
MAY NOT BE EXERCISED BY A U.S. PERSON AND THE COMMON SHARES ISSUABLE UPON
EXERCISE OF THIS WARRANT MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED BY A U.S. PERSON IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT AS TO THIS WARRANT UNDER SAID ACT OR ANY APPLICABLE STATE SECURITIES
LAW OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO CONOLOG CORPORATION THAT
SUCH REGISTRATION IS NOT REQUIRED.

 

 

Right to Purchase _________ shares of Common Stock of Conolog Corporation
(subject to adjustment as provided herein)

 

COMMON STOCK PURCHASE WARRANT

 

No. 2005-001

Issue Date: July 19, 2005

 

CONOLOG CORPORATION, a corporation organized under the laws of the State of
Delaware (the “Company”), hereby certifies that, for value received,
_______________________________,
____________________________________________________, or its assigns (the
“Holder”), is entitled, subject to the terms set forth below, to purchase from
the Company, commencing six months after the Closing Date (as defined in the
Subscription Agreement) until 5:00 p.m., E.S.T on the fifth anniversary of the
Issue Date (the “Expiration Date”), up to ______ fully paid and nonassessable
shares of the common stock of the Company (the “Common Stock”), $.01 par value
per share at an exercise price of $1.6892 [103% of the closing bid price as
reported on the SmallCap on the date prior to the Closing Date]. The
aforedescribed purchase price per share, as adjusted from time to time as herein
provided, is referred to herein as the "Purchase Price." The number and
character of such shares of Common Stock and the Purchase Price are subject to
adjustment as provided herein. Capitalized terms used and not otherwise defined
herein shall have the meanings set forth in that certain Subscription Agreement
(the “Subscription Agreement”), dated as of July 19, 2005, entered into by the
Company and the Holder.

 

As used herein the following terms, unless the context otherwise requires, have
the following respective meanings:

(a)        The term “Company” shall include Conolog Corporation and any
corporation which shall succeed or assume the obligations of Conolog Corporation
hereunder.

(b)        The term “Common Stock” includes (a) the Company's Common Stock, $.01
par value per share, as authorized on the date of the Subscription Agreement,
and (b) any other securities into which or for which any of the securities
described in (a) may be converted or exchanged pursuant to a plan of
recapitalization, reorganization, merger, sale of assets or otherwise.

(c)        The term “Other Securities” refers to any stock (other than Common
Stock) and other securities of the Company or any other person (corporate or
otherwise) which the holder of the Warrant at any time shall be entitled to
receive, or shall have received, on the exercise of the Warrant, in lieu of or
in addition to Common Stock, or which at any time shall be issuable or shall
have been issued in exchange for or in replacement of Common Stock or Other
Securities pursuant to Section 4 or otherwise.

 

 

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1.

Exercise of Warrant.

1.1.       Number of Shares Issuable upon Exercise. From and after the Issue
Date through and including the Expiration Date, the Holder hereof shall be
entitled to receive, upon exercise of this Warrant in whole in accordance with
the terms of subsection 1.2 or upon exercise of this Warrant in part in
accordance with subsection 1.3, shares of Common Stock of the Company, subject
to adjustment pursuant to Section 4.

1.2.       Full Exercise. This Warrant may be exercised in full by the Holder
hereof by delivery of an original or facsimile copy of the form of subscription
attached as Exhibit A hereto (the “Subscription Form") duly executed by such
Holder and surrender of the original Warrant upon exercise, to the Company at
its principal office or at the office of its Warrant Agent (as provided
hereinafter), accompanied by payment, in cash, wire transfer or by certified or
official bank check payable to the order of the Company, in the amount obtained
by multiplying the number of shares of Common Stock for which this Warrant is
then exercisable by the Purchase Price then in effect.

1.3.       Partial Exercise. This Warrant may be exercised in part (but not for
a fractional share) by surrender of this Warrant in the manner and at the place
provided in subsection 1.2 except that the amount payable by the Holder on such
partial exercise shall be the amount obtained by multiplying (a) the number of
whole shares of Common Stock designated by the Holder in the Subscription Form
by (b) the Purchase Price then in effect. On any such partial exercise, the
Company, at its expense, will forthwith issue and deliver to or upon the order
of the Holder hereof a new Warrant of like tenor, in the name of the Holder
hereof or as such Holder (upon payment by such Holder of any applicable transfer
taxes) may request, the whole number of shares of Common Stock for which such
Warrant may still be exercised.

1.4.       Fair Market Value. Fair Market Value of a share of Common Stock as of
a particular date (the "Determination Date") shall mean:

(a)        If the Company's Common Stock is traded on an exchange or is quoted
on the National Association of Securities Dealers, Inc. Automated Quotation
("NASDAQ"), National Market System, the NASDAQ SmallCap Market or the American
Stock Exchange, LLC, then the closing or last sale price, respectively, reported
for the last business day immediately preceding the Determination Date;

(b)        If the Company's Common Stock is not traded on an exchange or on the
NASDAQ National Market System, the NASDAQ SmallCap Market or the American Stock
Exchange, Inc., but is traded in the over-the-counter market, then the average
of the closing bid and ask prices reported for the last business day immediately
preceding the Determination Date;

(c)        Except as provided in clause (d) below, if the Company's Common Stock
is not publicly traded, then as the Holder and the Company agree, or in the
absence of such an agreement, by arbitration in accordance with the rules then
standing of the American Arbitration Association, before a single arbitrator to
be chosen from a panel of persons qualified by education and training to pass on
the matter to be decided; or

(d)        If the Determination Date is the date of a liquidation, dissolution
or winding up, or any event deemed to be a liquidation, dissolution or winding
up pursuant to the Company's charter, then all amounts to be payable per share
to holders of the Common Stock pursuant to the charter in the event of such
liquidation, dissolution or winding up, plus all other amounts to be payable per
share in respect of the Common Stock in liquidation under the charter, assuming
for the purposes of this clause (d) that all of the shares of Common Stock then
issuable upon exercise of all of the Warrants are outstanding at the
Determination Date.

 

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1.5.       Company Acknowledgment. The Company will, at the time of the exercise
of the Warrant, upon the request of the Holder hereof acknowledge in writing its
continuing obligation to afford to such Holder any rights to which such Holder
shall continue to be entitled after such exercise in accordance with the
provisions of this Warrant. If the Holder shall fail to make any such request,
such failure shall not affect the continuing obligation of the Company to afford
to such Holder any such rights.

1.6.       Trustee for Warrant Holders. In the event that a bank or trust
company shall have been appointed as trustee for the Holder of the Warrants
pursuant to Subsection 3.2, such bank or trust company shall have all the powers
and duties of a warrant agent (as hereinafter described) and shall accept, in
its own name for the account of the Company or such successor person as may be
entitled thereto, all amounts otherwise payable to the Company or such
successor, as the case may be, on exercise of this Warrant pursuant to this
Section 1.

1.7.       Delivery of Stock Certificates, etc. on Exercise. The Company agrees
that the shares of Common Stock purchased upon exercise of this Warrant shall be
deemed to be issued to the Holder hereof as the record owner of such shares is
made to the Company in immediately available funds as of the close of business
on the date on which this Warrant shall have been surrendered and payment made
for such shares as aforesaid. As soon as practicable after the exercise of this
Warrant in full or in part, and in any event within five (5) days thereafter,
the Company at its expense (including the payment by it of any applicable issue
taxes) will cause to be issued in the name of and delivered to the Holder
hereof, or as such Holder (upon payment by such Holder of any applicable
transfer taxes) may direct in compliance with applicable securities laws, a
certificate or certificates for the number of duly and validly issued, fully
paid and nonassessable shares of Common Stock (or Other Securities) to which
such Holder shall be entitled on such exercise, plus, in lieu of any fractional
share to which such Holder would otherwise be entitled, cash equal to such
fraction multiplied by the then Fair Market Value of one full share of Common
Stock, together with any other stock or other securities and property (including
cash, where applicable) to which such Holder is entitled upon such exercise
pursuant to Section 1 or otherwise.

2.

Cashless Exercise.

(a)        If a Registration Statement as defined in the Subscription Agreement
(“Registration Statement”) is effective and the Holder may sell its shares of
Common Stock upon exercise hereof, this Warrant may be exercisable in whole or
in part for cash only as set forth in Section 1 above. Commencing six months
after the Closing Date, if no such Registration Statement is available, then
payment upon exercise may be made at the option of the Holder either in
(i) cash, wire transfer or by certified or official bank check payable to the
order of the Company equal to the applicable aggregate Purchase Price, (ii) by
delivery of Common Stock issuable upon exercise of the Warrants in accordance
with Section (b) below (“Cashless Exercise”) or (iii) by a combination of any of
the foregoing methods, for the number of Common Stock specified in such form (as
such exercise number shall be adjusted to reflect any adjustment in the total
number of shares of Common Stock issuable to the holder per the terms of this
Warrant) and the holder shall thereupon be entitled to receive the number of
duly authorized, validly issued, fully paid and nonassessable shares of Common
Stock (or Other Securities) determined as provided herein.

(b)         If the Fair Market Value of one share of Common Stock is greater
than the Purchase Price (at the date of calculation as set forth below) and no
Registration Statement relating to the shares of Common Stock underlying this
Warrant is effective, in lieu of exercising this Warrant for cash, the holder
may elect to receive shares equal to the value (as determined below) of this
Warrant (or the portion thereof being cancelled) by surrender of this Warrant at
the principal office of the Company together with the properly endorsed
Subscription Form in which event the Company shall issue to the holder a number
of shares of Common Stock computed using the following formula:

 

 

 

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X=Y (A-B)

A

 

Where

X=

the number of shares of Common Stock to be issued to the holder

 

Y=

the number of shares of Common Stock purchasable under the Warrant or, if only a
portion of the Warrant is being exercised, the portion of the Warrant being
exercised (at the date of such calculation)

A=

the Fair Market Value of one share of the Company’s Common Stock (at the date of
such calculation)

B=

Purchase Price (as adjusted to the date of such calculation)

(c)        The Holder may employ the cashless exercise feature described above
only during the pendency of a Non-Registration Event as described in Section 12
of the Subscription Agreement and only commencing six months after the Closing
Date.

(d)        For purposes of Rule 144 promulgated under the 1933 Act, it is
intended, understood and acknowledged that the Commission currently has
interpreted Rule 144 to mean that the Warrant Shares issued in a cashless
exercise transaction shall be deemed to have been acquired by the Holder, and
the holding period for the Warrant Shares shall be deemed to have commenced, on
the date this Warrant was originally issued pursuant to the Subscription
Agreement.

3.

Adjustment for Reorganization, Consolidation, Merger, etc.

3.1.       Reorganization, Consolidation, Merger, etc. In case at any time or
from time to time, the Company shall (a) effect a reorganization,
(b) consolidate with or merge into any other person or (c) transfer all or
substantially all of its properties or assets to any other person under any plan
or arrangement contemplating the dissolution of the Company, then, in each such
case, as a condition to the consummation of such a transaction, proper and
adequate provision shall be made by the Company whereby the Holder of this
Warrant, on the exercise hereof as provided in Section 1, at any time after the
consummation of such reorganization, consolidation or merger or the effective
date of such dissolution, as the case may be, shall receive, in lieu of the
Common Stock (or Other Securities) issuable on such exercise prior to such
consummation or such effective date, the stock and other securities and property
(including cash) to which such Holder would have been entitled upon such
consummation or in connection with such dissolution, as the case may be, if such
Holder had so exercised this Warrant, immediately prior thereto, all subject to
further adjustment thereafter as provided in Section 4.

3.2.       Dissolution. In the event of any dissolution of the Company following
the transfer of all or substantially all of its properties or assets, the
Company, prior to such dissolution, shall at its expense deliver or cause to be
delivered the stock and other securities and property (including cash, where
applicable) receivable by the Holder of the Warrants after the effective date of
such dissolution pursuant to this Section 3 to a bank or trust company (a
"Trustee") having its principal office in New York, NY, as trustee for the
Holder of the Warrants.

3.3.       Continuation of Terms. Upon any reorganization, consolidation, merger
or transfer (and any dissolution following any transfer) referred to in this
Section 3, this Warrant shall continue in full force and effect and the terms
hereof shall be applicable to the Other Securities and property receivable on
the exercise of this Warrant after the consummation of such reorganization,
consolidation or merger or the effective date of dissolution following any such
transfer, as the case may be, and shall be binding upon the issuer of any Other
Securities, including, in the case of any such transfer, the person acquiring
all or substantially all of the properties or assets of the Company, whether or
not such person shall have expressly assumed the terms of this Warrant as
provided in Section 4. In the event this Warrant does not continue in full force
and effect after the consummation of the transaction

 

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described in this Section 3, then only in such event will the Company's
securities and property (including cash, where applicable) receivable by the
Holder of the Warrants be delivered to the Trustee as contemplated by
Section 3.2.

4.          Extraordinary Events Regarding Common Stock. In the event that the
Company shall (a) issue additional shares of the Common Stock as a dividend or
other distribution on outstanding Common Stock, (b) subdivide its outstanding
shares of Common Stock, or (c) combine its outstanding shares of the Common
Stock into a smaller number of shares of the Common Stock, then, in each such
event, the Purchase Price shall, simultaneously with the happening of such
event, be adjusted by multiplying the then Purchase Price by a fraction, the
numerator of which shall be the number of shares of Common Stock outstanding
immediately prior to such event and the denominator of which shall be the number
of shares of Common Stock outstanding immediately after such event, and the
product so obtained shall thereafter be the Purchase Price then in effect. The
Purchase Price, as so adjusted, shall be readjusted in the same manner upon the
happening of any successive event or events described herein in this Section 4.
The number of shares of Common Stock that the Holder of this Warrant shall
thereafter, on the exercise hereof as provided in Section 1, be entitled to
receive shall be adjusted to a number determined by multiplying the number of
shares of Common Stock that would otherwise (but for the provisions of this
Section 4) be issuable on such exercise by a fraction of which (a) the numerator
is the Purchase Price that would otherwise (but for the provisions of this
Section 4) be in effect, and (b) the denominator is the Purchase Price in effect
on the date of such exercise.

5.          Certificate as to Adjustments. In each case of any adjustment or
readjustment in the shares of Common Stock (or Other Securities) issuable on the
exercise of the Warrants, the Company at its expense will promptly cause its
Chief Financial Officer or other appropriate designee to compute such adjustment
or readjustment in accordance with the terms of the Warrant and prepare a
certificate setting forth such adjustment or readjustment and showing in detail
the facts upon which such adjustment or readjustment is based, including a
statement of (a) the consideration received or receivable by the Company for any
additional shares of Common Stock (or Other Securities) issued or sold or deemed
to have been issued or sold, (b) the number of shares of Common Stock (or Other
Securities) outstanding or deemed to be outstanding, and (c) the Purchase Price
and the number of shares of Common Stock to be received upon exercise of this
Warrant, in effect immediately prior to such adjustment or readjustment and as
adjusted or readjusted as provided in this Warrant. The Company will forthwith
mail a copy of each such certificate to the Holder of the Warrant and any
Warrant Agent of the Company (appointed pursuant to Section 11 hereof).

6.          Reservation of Stock, etc. Issuable on Exercise of Warrant;
Financial Statements. The Company will at all times reserve and keep available,
solely for issuance and delivery on the exercise of the Warrants, all shares of
Common Stock (or Other Securities) from time to time issuable on the exercise of
the Warrant. This Warrant entitles the Holder hereof to receive copies of all
financial and other information distributed or required to be distributed to the
holders of the Company's Common Stock.

7.          Assignment; Exchange of Warrant. Subject to compliance with
applicable securities laws, this Warrant, and the rights evidenced hereby, may
be transferred by any registered holder hereof (a "Transferor"). On the
surrender for exchange of this Warrant, with the Transferor's endorsement in the
form of Exhibit B attached hereto (the “Transferor Endorsement Form") and
together with evidence reasonably satisfactory to the Company demonstrating
compliance with applicable security laws, which shall include, without
limitation, a legal opinion from the Transferor’s counsel that such transfer is
exempt from the registration requirements of applicable securities laws, the
Company at its expense, twice, only, but with payment by the Transferor of any
applicable transfer taxes, will issue and deliver to or on the order of the
Transferor thereof a new Warrant or Warrants of like tenor, in the name of the
Transferor and/or the transferee(s) specified in such Transferor Endorsement
Form (each a "Transferee"), calling in the aggregate on the face or faces
thereof for the number of shares of Common Stock called for on the face or faces
of the Warrant so surrendered by the Transferor. No such transfers shall result
in a public distribution of the Warrant.

 

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8.          Replacement of Warrant. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and, in the case of any such loss, theft or destruction of this
Warrant, on delivery of an indemnity agreement or security reasonably
satisfactory in form and amount to the Company or, in the case of any such
mutilation, on surrender and cancellation of this Warrant, the Company at its
expense, twice only, will execute and deliver, in lieu thereof, a new Warrant of
like tenor.

9.          Registration Rights. The Holder of this Warrant has been granted
certain registration rights by the Company. These registration rights are set
forth in the Subscription Agreement.

10.        Maximum Exercise. The Holder shall not be entitled to exercise this
Warrant on an exercise date nor may the Company exercise its right to give a
Call Notice (as defined in Section 11) in connection with that number of Common
Stock which would be in excess of the sum of (i) the number of shares of Common
Stock beneficially owned by the Holder and its affiliates on an exercise date or
Call Date, and (ii) the number of Common Stock issuable upon the exercise of
this Warrant with respect to which the determination of this limitation is being
made on an exercise date or Call Date, which would result in beneficial
ownership by the Holder and its affiliates of more than 4.99% of the outstanding
Common Stock on such date. For the purposes of the immediately preceding
sentence, beneficial ownership shall be determined in accordance with
Section 13(d) of the Securities Exchange Act of 1934, as amended, and Regulation
13d-3 thereunder. Subject to the foregoing, the Holder shall not be limited to
aggregate exercises which would result in the issuance of more than 4.99%. The
restriction described in this paragraph may be waived, in whole or in part, upon
sixty-one (61) days prior written notice from the Holder to the Company. The
Holder may allocate which of the equity of the Company deemed beneficially owned
by the Subscriber shall be included in the 4.99% amount described above and
which shall be allocated to the excess above 4.99% provided such allocations are
consistent with applicable law.

11.        Call. The Company in its sole discretion shall have the option (but
not the obligation) to "call" the exercise of the shares issuable upon exercise
of this Warrant (the "Warrant Call") in accordance with and governed by the
following:

(a)        The Company shall exercise the Warrant Call by giving to the Warrant
Holder a written notice of call (the "Call Notice") during the period in which
the Warrant Call may be exercised. The effective date of each Call Notice (the
“Call Date”) is the date on which notice is effective under the notice provision
of Section 15 of this Warrant.

(b)        The Company's right to exercise the Warrant Call shall commence upon
the later of six months after the issue date or thirty trading days after the
actual effective date of a Registration Statement described in Section 11.1(iv)
of the Subscription Agreement and end thirty trading days prior to the
Expiration Date.

(c)        The number of shares of Common Stock to be issued upon exercise of
the Warrant which are subject to a Call Notice must be registered in a
Registration Statement effective from twenty (20) trading days prior to the Call
Date and through the date such Common Stock is actually delivered to the Warrant
Holder unless such Common Stock can be resold or transferred pursuant to Rule
144 (“Delivery Date”) and provided the Warrant Shares subject to Call are
delivered without any restrictive or other legend.

 

(d)        A Call Notice may be given not sooner than fifteen trading days after
the prior Call Date.

 

(e)       A Call Notice may be given by the Company in connection with shares of
Common Stock issuable upon exercise of the Warrant only within ten days after
the Common Stock has had a closing price as reported for the Principal Market
(as defined in the Subscription Agreement) of one hundred and seventy-five
percent (175%) of the exercise price for twenty (20) consecutive trading days

 

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(“Lookback Period”), and average daily trading volume during the Lookback Period
of not less than 150,000 shares of Common Stock.

 

(f)         The Common Stock must be listed on the Principal Market for the
Lookback Period and through the Delivery Date.

(g)        The Company shall not have received a notice from the Principal
Market during the ninety calendar days prior to the Call Date that the Company
or its Common Stock does not meet the requirements for continued quotation,
listing or trading on the Principal Market.

(h)        The Company and the Common Stock shall meet the requirements for
continued quotation, listing or trading on the Principal Market for the Lookback
Period and through the Delivery Date.

(i)         Unless otherwise agreed to by the Holder of this Warrant, a Call
Notice must be given to all Warrant Holders (except for Brokers’ Warrants or
assignees or transferees of Brokers’ Warrants) who receive Warrants similar to
this Warrant (in terms of exercise price and other principal terms) issued on or
about the same Issue Date as this Warrant, in proportion to the amounts of
Common Stock which may be purchased by the respective Warrant Holders in
accordance with the respective Warrants held by each.

(j)         The Warrant Holder shall exercise his Warrant rights and purchase
the Called Warrant Shares and pay for same within fourteen trading days after
the Call Date. If the Warrant Holder fails to timely pay the amount required by
the Warrant Call, the Company’s sole remedy shall be to cancel a corresponding
amount of this Warrant. Without limiting the generality of the foregoing, the
exercise of warrants by the Warrant Holder pursuant to this section shall be in
accordance with Sections 1 and 2 of this Agreement

(k)        The Company may not exercise its right to Call this Warrant after the
occurrence of a default by the Company of a material term of this Warrant or the
Subscription Agreement or the Notes referred to in the Subscription Agreement.

12.        Warrant Agent. The Company may, by written notice to the Holder of
the Warrant, appoint an agent (a “Warrant Agent”) for the purpose of issuing
Common Stock (or Other Securities) on the exercise of this Warrant pursuant to
Section 1, exchanging this Warrant pursuant to Section 7, and replacing this
Warrant pursuant to Section 8, or any of the foregoing, and thereafter any such
issuance, exchange or replacement, as the case may be, shall be made at such
office by such Warrant Agent.

13.        Transfer on the Company's Books. Until this Warrant is transferred on
the books of the Company, the Company may treat the registered holder hereof as
the absolute owner hereof for all purposes, notwithstanding any notice to the
contrary.

14.        No Rights as a Stockholder. This Warrant does not entitle the Warrant
Holder to any voting rights or other rights as a stockholder of the Company nor
to any rights whatsoever except the rights herein set forth until such Warrant
is exercised.

 

15.        Notices. All notices, demands, requests, consents, approvals, and
other communications required or permitted hereunder shall be in writing and,
unless otherwise specified herein, shall be (i) personally served, (ii)
deposited in the mail, registered or certified, return receipt requested,
postage prepaid, (iii) delivered by reputable air courier service with charges
prepaid, or (iv) transmitted by hand delivery, telegram, or facsimile, addressed
as set forth below or to such other address as such party shall have specified
most recently by written notice. Any notice or other communication required or
permitted to be given hereunder shall be deemed effective (a) upon hand delivery
or delivery by facsimile, with accurate confirmation generated by the
transmitting facsimile machine, at the address or number

 

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designated below (if delivered on a business day during normal business hours
where such notice is to be received), or the first business day following such
delivery (if delivered other than on a business day during normal business hours
where such notice is to be received) or (b) on the second business day following
the date of mailing by express courier service, fully prepaid, addressed to such
address, or upon actual receipt of such mailing, whichever shall first occur.
The addresses for such communications shall be: (i) if to the Company to:
Conolog Corporation, 5 Columbia Road, Somerville, NJ 08876, Attn: Robert Benou,
telecopier: (908) 722-5461, with a copy by telecopier only to: Milberg Weiss
Bershad & Schulman LLP, One Penn Plaza, New York, NY 10119 Attn: Arnold N.
Bressler, Esq., telecopier: (212) 273-4373, (ii) if to the Subscribers, to: the
one or more addresses and telecopier numbers indicated on the signature pages to
the Subscription Agreement, with an additional copy by telecopier only to:
Grushko & Mittman, P.C., 551 Fifth Avenue, Suite 1601, New York, New York 10176,
telecopier number: (212) 697-3575.

16.        Miscellaneous. This Warrant and any term hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by the
party against which enforcement of such change, waiver, discharge or termination
is sought. This Warrant shall be construed and enforced in accordance with and
governed by the laws of New York. Any dispute relating to this Warrant shall be
adjudicated in New York County in the State of New York. The headings in this
Warrant are for purposes of reference only, and shall not limit or otherwise
affect any of the terms hereof. The invalidity or unenforceability of any
provision hereof shall in no way affect the validity or enforceability of any
other provision.

 

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IN WITNESS WHEREOF, the Company has executed this Warrant as of the date first
written above.

 

CONOLOG CORPORATION

 

 

 

By:  

   

 

Name:

Title:

 

 

Witness:

 

 

 

 

 

 

 

 

 

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Exhibit A

 

FORM OF SUBSCRIPTION

(to be signed only on exercise of Warrant)

TO: CONOLOG CORPORATION

 

The undersigned, pursuant to the provisions set forth in the attached Warrant
(No.____), hereby irrevocably elects to purchase (check applicable box):

 

___

________ shares of the Common Stock covered by such Warrant; or

 

___       the maximum number of shares of Common Stock covered by such Warrant
pursuant to the cashless exercise procedure set forth in Section 2.

 

The undersigned herewith makes payment of the full purchase price for such
shares at the price per share provided for in such Warrant, which is
$___________. Such payment takes the form of (check applicable box or boxes):

 

___

$__________ in lawful money of the United States; and/or

 

___       the cancellation of such portion of the attached Warrant as is
exercisable for a total of _______ shares of Common Stock (using a Fair Market
Value of $_______ per share for purposes of this calculation); and/or

 

___       the cancellation of such number of shares of Common Stock as is
necessary, in accordance with the formula set forth in Section 2, to exercise
this Warrant with respect to the maximum number of shares of Common Stock
purchasable pursuant to the cashless exercise procedure set forth in Section 2.

 

The undersigned requests that the certificates for such shares be issued in the
name of, and delivered to _________________________ whose address is

 

.

 

The undersigned represents and warrants that all offers and sales by the
undersigned of the securities issuable upon exercise of the within Warrant shall
be made pursuant to registration of the Common Stock under the Securities Act of
1933, as amended (the "Securities Act"), or pursuant to an exemption from
registration under the Securities Act.

 

Dated:___________________

(Signature must conform to name of holder as specified on the face of the
Warrant)

 

  (Address)

 

 

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Exhibit B

 

FORM OF TRANSFEROR ENDORSEMENT

(To be signed only on transfer of Warrant)

For value received, the undersigned hereby sells, assigns, and transfers unto
the person(s) named below under the heading "Transferees" the right represented
by the within Warrant to purchase the percentage and number of shares of Common
Stock of CONOLOG CORPORATION to which the within Warrant relates specified under
the headings "Percentage Transferred" and "Number Transferred," respectively,
opposite the name(s) of such person(s) and appoints each such person Attorney to
transfer its respective right on the books of CONOLOG CORPORATION with full
power of substitution in the premises.

 

Transferees

Percentage Transferred

Number Transferred

 

 

 

 

 

 

 

 

 

 

 

Dated: ______________, ___________         (Signature must conform to name of
holder as specified on the face of the warrant)       Signed in the presence of:
                          (Name)                   (address)      

ACCEPTED AND AGREED:

[TRANSFEREE]
                              (address)                 (Name)          

 

 

 

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