univguar13dex411208.htm


    Exhibit
4.1

     

    THIS
WARRANT AND ANY WARRANT SHARES ISSUED UPON EXERCISE OF THIS WARRANT ARE SUBJECT
TO A SECURITIES PURCHASE AND NOTE AGREEMENT, DATED AS OF NOVEMBER 30, 2007, A
COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICE OF THE COMPANY AND WILL BE
FURNISHED TO THE HOLDER ON REQUEST TO THE SECRETARY OF THE COMPANY. SUCH
SECURITIES PURCHASE AND NOTE AGREEMENT PROVIDES, AMONG OTHER THINGS, FOR CERTAIN
RESTRICTIONS ON DISPOSITION OF THE SECURITIES EVIDENCED BY THIS
CERTIFICATE.

     

    THIS
WARRANT, THE PURCHASE RIGHTS EVIDENCED BY THIS WARRANT AND ANY WARRANT SHARES
WHICH MAY BE ISSUED UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED
PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR
ANY STATE SECURITIES LAW, AND THIS WARRANT, SUCH PURCHASE RIGHTS AND WARRANT
SHARES MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS THE SAME ARE
REGISTERED AND QUALIFIED IN ACCORDANCE WITH THE SECURITIES ACT AND ANY
APPLICABLE STATE SECURITIES LAWS, OR IN THE OPINION OF COUNSEL REASONABLY
SATISFACTORY TO THE COMPANY SUCH REGISTRATION AND QUALIFICATION ARE NOT
REQUIRED.

     

    
      	
              No.
      1

            	 
      	
              Warrant
      to Purchase

               

            
	
              Dated:  December
      17, 2007

            	
              155,144
      shares of Common Stock

            
	 
      
	
              (subject
      to adjustment

              as
      described herein)

               

            
	
              WARRANT
      CERTIFICATE

               

            
	
              Representing
      Common Stock Purchase Warrant

               

            
	
              AMEN PROPERTIES,
      INC.

               

            
	
              Purchase
      Price of Common Stock:

            	
              $6.02
      per share

               

            
	 
      	
              (subject
      to adjustment)

            


    

    


     

    THIS WARRANT CERTIFICATE (this "Warrant") CERTIFIES that, for value
received, UNIVERSAL GUARANTY LIFE INS. CO., its registered assigns or the Holder
(as defined below) hereof, is entitled, at any time prior to the close of
business on the Expiration Date defined below, to purchase the number of shares
stated above (subject to adjustment as herein provided) of Common Stock of Amen
Properties, Inc., a Delaware corporation (the "Company"), at the purchase price per
share stated above (subject to adjustment as herein provided) (the "Purchase
Price") upon
surrender of this Warrant at the Principal Office of the Company and payment of
such Purchase Price in cash or by bank cashier's or certified
check.

     

    This
Warrant is one of the Warrants originally issued by the Company, initially
covering an aggregate of 450,000 shares of Common Stock, pursuant to a
Securities Purchase and Note

     


    
      
        1 


      

      
         


        
          

        

      

      
         


      

    


    Agreement
dated as of November 30, 2007 between the Company and the Investors named on the
signature pages thereto (the "Agreement").

     

    1.  Definitions.
The following terms have the meanings set forth below.  Additional
terms are defined elsewhere herein.

     

    "Common
Stock" means the
Common Stock, par value $.01 per share, of the Company.

     

    "Exercise
Date" with
respect to any Warrant means each date on which Warrant Shares are to be issued
upon exercise of such Warrant.

     

    "Expiration
Date" means June
30, 2008.

     

    "Holder" means the registered holder
or holders of this Warrant and any related Warrant Shares.

     

    "Holders" means the registered
holders of all Warrants.

     

    "Investors" means all of the initial
Holders of the Warrants who acquired the Warrants from the Company.

     

    "Principal
Office" means
the principal office of the Company which, on the date hereof, is located at 303
West Wall, Suite 2300, Midland Texas 79701. The Company shall notify each Holder
of any change in its principal office.

     

    "Purchase
Price" has the
meaning assigned to that term in the introductory paragraph hereof.

     

    "Securities
Act" means the
Securities Act of 1933, as amended.

     

    "Warrants" means the Company's Common
Stock Purchase Warrants and any Warrant Certificates representing such Common
Stock Purchase Warrants (including the Warrant represented by this Warrant
Certificate) issued pursuant to the Agreement, each identical as to the terms
and conditions of this Warrant Certificate except as to the number of shares of
Common Stock for which they may be exercised, evidencing, in the aggregate, the
right to purchase initially 450,000 shares of Common Stock, all Warrants issued
in exchange, transfer or replacement thereof.

     

    “Warrant
Shares" means
the shares of Common Stock purchased or purchasable by the Holder upon the
exercise of this Warrant pursuant to Section 2 hereof, and where the context so
requires, the shares of Common Stock issuable upon exercise of any other Warrant
by the Holder thereof.

     

    Any
capitalized term not otherwise defined herein shall have the meaning specified
in the Agreement.

     


    
      
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    2.  Exercise.

     

    A.    General. Subject to the
limitation set forth in Section 2E and any other limitation set forth herein or
in the Agreement or imposed by applicable law, each Holder shall be entitled to
exercise any Warrant held by it, in whole or in part, at any time or from time
to time commencing on the date of issuance of the Warrant until 5:00 p.m.,
Midland, Texas time, on the Expiration Date.

     

    B.    Manner of Exercise. In order
to exercise any Warrant in whole or in part, the Holder shall complete one of
the subscription forms attached hereto, deliver the Warrant to the Company at
its Principal Office and make payment of the Purchase Price pursuant to one of
the payment options provided in this Section 2.B Payment of the Purchase Price
shall be made at the option of the Holder by one or more of the following
methods: (1) by delivery to the Company of cash, a certified check or a bank
cashier's check in an amount equal to the then aggregate Purchase Price, (2) by
instructing the Company to withhold a number of Warrant Shares then issuable
upon exercise of the particular Warrant with an aggregate Fair Market Value (as
defined below) equal to such Purchase Price, or (3) by surrendering to the
Company shares of Common Stock previously acquired by the Holder with an
aggregate Fair Market Value equal to such Purchase Price, or any combination of
the foregoing. Upon receipt thereof by the Company, the Holder shall immediately
be deemed to be a holder of record of the shares of Common Stock specified in
said subscription form, and the Company shall, as promptly as practicable, and
in any event within ten (10) business days thereafter, execute and deliver or
cause to be delivered to the Holder a certificate or certificates representing
the aggregate number of shares of Common Stock specified in said subscription
form. Each stock certificate so delivered shall be registered in the name of
such Holder or such other name as shall be designated by such Holder, subject to
compliance with federal and state securities laws and Section 4 hereof. If the
Warrant shall have been exercised only in part, the Company shall, at the time
of delivery of said stock certificate or certificates, deliver to the Holder a
Warrant in the form of this Warrant representing the right to purchase the
remaining number of shares purchasable thereunder. The Company shall pay all
expenses, taxes and other charges payable in connection with the preparation,
execution and delivery of stock certificates pursuant to this Section 2, except
that, in case such stock certificates shall be registered in a name or names
other than the name of the Holder, funds sufficient to pay all stock transfer
taxes which shall be payable upon the execution and delivery of such stock
certificate or certificates shall be paid by the Holder to the Company at the
time of delivering the Warrant to the Company. As used herein "Fair
Market Value" on
any day shall mean (i) the average of the daily closing sale prices of the
Common Stock during the twenty (20) trading days immediately preceding the day
as of which "Fair Market
Value" is being determined, on the principal securities exchange on which
the Common Stock is then listed, or if there shall have been no sales of the
Common Stock on such exchange on such day, the mean of the closing bid and asked
prices on· such exchange at the end of such day, or (ii) if the Common Stock is
not so listed, the average of the high and low bid and prices on such day in a
domestic over-the-counter market, or (iii) any time the Common Stock is not
listed on any domestic exchange or quoted in a domestic over-the-counter market,
the "Fair Market Value"
shall be determined by the Board of Directors of the
Company.

     

    
      
        3

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    C.    Transfer Restriction Legend.
Each Warrant shall bear the legends set forth on the face of this Warrant. Each
certificate for Warrant Shares issued upon exercise or conversion of this
Warrant, unless at the time of exercise or conversion such Warrant Shares are
registered under the Securities Act, shall bear the legends described in Section
5.8 of the Agreement.

     

    D.    Character of Warrant Shares.
All shares of Common Stock issuable upon the exercise of the Warrants shall be
duly authorized, validly issued, fully paid and nonassessable.

     

    E.    Limitation on Exercise.
Notwithstanding anything stated herein to the contrary, unless and until the
issuance and sale of the Warrants and the Warrant Shares are approved or
ratified by the stockholders of the Company in accordance with the rules of the
Nasdaq Stock Market (the "Stockholder
Approval”), the
Warrants cannot be exercised for a total number of shares of Common Stock equal
to or greater than five percent (5%) of the number of shares of Common Stock
outstanding immediately prior to the issuance of the Warrants (the "Common
Stock Cap"), and
any Warrants held by a Holder that is an Inside Investor (as defined in the
Agreement) cannot be exercised for any shares of Common Stock. The exercise of
this Warrant and the other Warrants is expressly limited by and subject to this
Section 2E for all purposes unless and until the Stockholder Approval is
obtained.  In the event the Common Stock Cap is less than the number
of shares of Common Stock into which the outstanding Warrants are exercisable,
the exercise right of the Warrants shall be reduced pro rata among the
outstanding Warrants. In no event shall the total number of shares of Common
Stock into which the Warrants are exercisable exceed the Common Stock Cap prior
to the Stockholder Approval. Upon Stockholder Approval, the Common Stock Cap and
other limitations set forth in this Section 2E shall terminate and this Warrant
shall be exercisable in accordance with the terms hereof excluding this Section
2E.

     

    3.  Ownership
and Exchange of the Warrants.

     

    A.    Registered Holder. The Company
may deem and treat the person in whose name each Warrant is registered as the
Holder and owner thereof (notwithstanding any notations of ownership or writing
thereon made by anyone other than the Company) for all purposes and shall not be
affected by any notice to the contrary, until presentation of such Warrant for
exchange or transfer as provided in this Section 3.

     

    B.    Exchange and Replacement. Any
Warrant is exchangeable upon the surrender thereof by the Holder to the Company
at its Principal Office for a new Warrant or Warrants of like tenor and date
representing in the aggregate the right to purchase the number of shares
purchasable thereunder, each new Warrant to represent the right to purchase such
number of shares as shall be designated by the Holder at the time of surrender.
Subject to compliance with Section 4, each Warrant and all rights thereunder are
transferable in whole or in part upon the books of the Company by the Holder
thereof in person or by duly authorized attorney, and a new Warrant shall be
made and delivered by the Company, of the same class, tenor and date as the
Warrant but registered in the name of the transferee, upon surrender of the
Warrant, duly endorsed, at the Principal Office of the Company. The Company will
issue replacement Warrant

     


    
      
        4 


      

      
         


        
          

        

      

      
         


      

    


    certificates
upon the loss, theft, destruction or mutilation thereof. Warrants shall be
promptly canceled by the Company upon the surrender thereof in connection with
any exchange, transfer or replacement. The Company shall pay all expenses, taxes
(other than stock transfer taxes) and other charges payable in connection with
the preparation, execution and delivery of Warrants pursuant to this Section
3.

     

    4.  Transfer
of Warrants or Warrant Shares. This Warrant and the related Warrant
Shares shall not be transferable except in accordance with the terms and
conditions specified in the Agreement and in accordance with applicable
law.

     

    5.  Adjustment
Provisions. The aggregate number of shares of Common Stock issuable upon
exercise of the Warrants, and the Purchase Price per share, shall be subject to
adjustment in the events and to the extent set forth in Exhibit
I.

     

    6.   Notices.
Any notice or other document required or permitted to be given or delivered to
Holders shall be delivered at, or sent by certified or registered mail to each
Holder at, the address set forth for such Holder on the signature page hereof or
to such other address as shall have been furnished to the Company in writing by
such Holder. Any notice or other document required or permitted to be given or
delivered to the Company shall be sent by certified or registered mail to the
Company, at its Principal Office, attention: President, or other such address as
shall have been furnished to the Holders by the Company.

     

    7.  No Rights
as Stockholder; Limitation of Liability. This Warrant shall not entitle
any Holder thereof to any of the rights of a stockholder of the Company. No
provision hereof, in the absence of affirmative action by the Holder to purchase
shares of Common Stock, and no enumeration herein of the rights or privileges of
the Holder of a Warrant, shall give rise to any liability of such Holder for the
Purchase Price or as a stockholder of the Company, whether such liability is
asserted by the Company or by creditors of the Company.

     

    8.  Miscellaneous.
This Warrant shall be governed by, and construed and enforced in accordance
with, the laws of the State of Delaware. This Warrant and any provision hereof
may be changed, waived, discharged or terminated only by an instrument in
writing signed by the party (or any predecessor in interest thereof) against
which enforcement of the same is sought. The headings in this Warrant are for
purposes of reference only and shall not affect the meaning or construction of
any of the provisions hereof.

     


    
      
         
5

      

      
         


        
          

        

      

      
         


      

    


    WITNESS
the due execution of this Warrant by a duly authorized officer of the
Company.

     

    
      
        	 	
                AMEN PROPERTIES,
      INC.,

                 

                a Delaware
      corporation

              	 
	 	
                 

                 

                 

              	 	 
	
                 

              	
                By:
      

              	/s/ Jon
      M. Morgan	 
	 	 	Jon
      M. Morgan, Chief Executive Officer	 
	 	 	 	 
	 	 	 	 


      

    

     

     

     

    ATTEST:

     

    


     

    


     

    


     

    /s/ Kris Oliver                                                                                     

     

    Secretary

     

    ACCEPTED
this 17th day of
December, 2007:

     

    UNIVERSAL
GUARANTY LIFE INS. CO.

     

    


     

    By:           /s/ Theodore C.
Miller                                                      

    Name:                      Theodore C.
Miller                                                    

    Title:                 
Sr. Vice
President                                                      

    


     

    Address:                5250
South Sixth Street

    P.O. Box 5147

    Springfield,
Illinois  72705


    
      
        6 


      

      
         


        
          

        

      

      
         


      

    


    FULL SUBSCRIPTION
FORM

     

    _____ To
Be Executed by the Registered Holder

    if He
Desires to Exercise the Warrant in Full

     

    The
undersigned hereby exercises the right to purchase the __________ shares of
Common Stock covered by the attached Warrant at the date of this subscription
and herewith makes payment of the sum of $____________ representing the Purchase
Price of $____________ per share in effect at this date. Certificates for such
shares shall be issued in the name of and delivered to the undersigned, unless
otherwise specified in written instructions signed by the undersigned and
accompanying this subscription.

     

    
      	
              Dated:                      _______________,
      _____

            	
                      [                                                                    
                          ]

               

               

               

              Signature:    _____________________________________

               

              Address:    ______________________________________

                      _______________________________________

               

            


    


    
      
        
          Mid:  010056\000010\5833282.1

        

         


      

      
         


        
          

        

      

      
         


      

    


    FULL SUBSCRIPTION
FORM

     

    _____ To
Be Executed by the Registered Holder

    if He
Desires to Exercise the Warrant in Full

     

    The
undersigned hereby exercises the right to purchase the __________ shares of
Common Stock covered by the attached Warrant at the date of this subscription
and herewith makes payment of the sum of $____________ representing the Purchase
Price of $____________ per share in effect at this date. Certificates for such
shares shall be issued in the name of and delivered to the undersigned, unless
otherwise specified in written instructions signed by the undersigned and
accompanying this subscription.

     

    
      	
              Dated:                      _______________,
      _____

            	
                      [                                                                          
                    ]

               

               

               

              

                Signature:    _____________________________________

                 

                Address:    ______________________________________

                        _______________________________________


            


    


    
      
        
          Mid:  010056\000010\583382.1

        

         


      

      
         


        
          

        

      

      
         


      

    


    EXHIBIT
I

     

    ANTI-DILUTION
PROVISIONS

     

    The
number of Warrant Shares purchasable upon the exercise of this Warrant and the
Purchase Price shall be subject to adjustment from time to time upon the
happening of certain events as hereinafter described. Capitalized terms used but
not defined herein shall have the meanings assigned thereto in the
Warrant.

     

    1.    
Special Definitions. For
purposes of this Exhibit I, the
following definitions shall apply:

     

    (A) "Option" shall mean rights, options
or warrants to subscribe for, purchase or otherwise acquire Common Stock or
Convertible Securities, excluding rights, options or shares granted or issued to
employees, vendors, officers, directors and executives of, and consultants or
shareholders to, the Company in an amount not exceeding the number of Reserved
Employee Shares.

     

    (B) "Original Issue
Date" shall mean
the date of this Warrant.

     

    (C) "Convertible
Securities"
shall mean any evidences of indebtedness, shares or other securities
directly or indirectly convertible into or exchangeable for Common
Stock.

     

    (D) "Additional Shares
of Common Stock"
shall mean all shares of Common Stock issued (or, pursuant to Section 3
below, deemed to be issued) by the Company after the Original Issue Date, other
than Reserved Employee Shares and other than shares of Common Stock issued or
issuable:

     

    (1) by reason
of a stock dividend, stock split, split-up or other distribution on shares of
Common Stock; or

     

    (2) upon the
exercise of Options;

     

    (E) "Reserved Employee
Shares" shall
mean shares of Common Stock issued to employees, officers, directors,
shareholders and executives of, and consultants or vendors to, the Company
either directly as compensation or upon the exercise of options granted by the
Company.

     

    (F) "Rights to Acquire
Common Stock"
(or "Rights") shall mean all rights
issued by the Company to acquire Common Stock whether by exercise of a warrant,
option or similar call, or conversion of any existing instruments, in either
case for consideration fixed, in amount or by formula, as of the date of
issuance.

     


    
      
        
          Mid:  010056\000010\583382.1

          I-1

           Exhibit
I

        

         


      

      
         


        
          

        

      

      
         


      

    


    


     

    2.  No Adjustment of Conversion Prices.
No adjustment in the number of Warrant Shares shall be made (i) unless
the consideration per share (determined pursuant to Section 5 below) for an
Additional Share of Common Stock issued or deemed to be issued by the Company is
less than the Purchase Price in effect on the date of, and immediately prior to,
the issue of such Additional Shares of Common Stock, or (ii) if prior to such
issuance, the Company receives written consent from the holders of at least a
majority of the voting power of all then outstanding Warrants agreeing that no
such adjustment shall be made as the result of the issuance of Additional Shares
of Common Stock.

     

    3.  Issue of Securities Deemed Issue of
Additional Shares of Common Stock. If the Company at any time or from
time to time after the Original Issue Date shall issue any Options or
Convertible Securities or Rights to Acquire Common Stock, then the maximum
number of shares of Common Stock (as set forth in the instrument relating
thereto without regard to any provision contained therein for a subsequent
adjustment of such number) issuable upon the exercise of such Options, Rights
or, in the case of Convertible Securities, the conversion or exchange of such
Convertible Securities, shall be deemed to be Additional Shares of Common Stock
issued as of the time of such issue; provided, however, that Additional Shares
of Common Stock shall not be deemed to have been issued unless the consideration
per share (determined pursuant to Section 5 hereof) of such Additional Shares of
Common Stock would be less than the Purchase Price in effect on the date of and
immediately prior to such issue, or such record date, as the case may be, and
provided, further, that in any such case:

     

    (A) No
further adjustment in the Purchase Price shall be made upon the subsequent issue
of shares of Common Stock upon the exercise of such Options, Rights or
conversion or exchange of such Convertible Securities;

     

    (B) Upon the
expiration or termination of any unexercised Option, Right or Convertible
Security, the Purchase Price shall be adjusted immediately to reflect the
Purchase Price which would have been in effect had such Option, Right or
Convertible Security (to the extent outstanding immediately prior to such
expiration or termination) never been issued; and

     

    (C) In the
event of any change in the number of shares of Common Stock issuable upon the
exercise, conversion or exchange of any Option, Right or Convertible Security,
including, but not limited to, a change resulting from the anti-dilution
provisions thereof, the Purchase Price then in effect shall forthwith be
readjusted to such Purchase Price as would have been obtained had the Purchase
Price adjustment that was originally made upon the issuance of such Option,
Right or Convertible Security which were not exercised or converted prior to
such change been made upon the basis of such change, but no further adjustment
shall be made for the actual issuance of Common Stock upon the exercise or
conversion of any such Option, Right or Convertible Security.

     

    4.  
Adjustment of Conversion Prices upon
Issuance of Additional Shares of Common Stock.   If the
Company shall at any time after the Original Issue Date issue Additional Shares
of Common Stock (including Additional Shares of Common Stock deemed to be issued
pursuant to Section 3, but excluding shares issued as a dividend or distribution
as provided in Section 7 or

     


    
      
        
          Mid:  010056\000010\583382.1                                                                  


          I-2 

          Exhibit
I

        

         


      

      
         


        
          

        

      

      
         


      

    


    upon a
stock split or combination as provided in Section 6), without consideration, or
for a consideration per share less than the Purchase Price in effect on the date
of and immediately prior to such issue, or without the requisite consent
contemplated by Section 2 hereof, then and in such event, the Purchase Price
shall be reduced by a full ratchet anti-dilution adjustment to such lesser price
(calculated to the nearest cent), but in no case will the Purchase Price be
reduced below $2.80 per share, concurrently with such issuance at a price less
than the original Purchase Price. Notwithstanding the foregoing, the applicable
Purchase Price shall not be reduced if the amount of such reduction would be an
amount less than $.20, but any such amount shall be carried forward and
reduction with respect thereto made at the time of and together with any
subsequent reduction which, together with such amount and any other amount or
amounts so carried forward, shall aggregate $.20 or more.

     

    5. Determination of Consideration.
For purposes of this Exhibit 1, the consideration received by the Company
for the issue of any Additional Shares of Common Stock shall be computed as
follows:

     

    (A) Cash and Property.
Such consideration shall:

     

    (1) insofar
as it consists of cash, be computed at the aggregate of cash received by the
Company, excluding amounts paid or payable for accrued interest or accrued
dividends;

     

    (2) insofar
as it consists of property other than cash, be computed at the fair market value
thereof at the time of such issue, as determined in good faith by the Board;
and

     

    (3) in the
event Additional Shares of Common Stock are issued together with other shares or
securities or other assets of the Company for consideration which covers both,
be the proportion of such consideration so received, computed as provided in
clauses (l) and (2) above, as determined in good faith by the
Board.

     

    (B) Options, Rights and
Convertible Securities. The consideration per share received by the
Company for Additional Shares of Common Stock deemed to have been issued
pursuant to Section 3, relating to Options, Rights and Convertible Securities,
shall be determined by dividing

     

    (1) the total
amount, if any, received or receivable by the Company as consideration for the
issue of such Options, Rights or Convertible Securities, plus the minimum
aggregate amount of additional consideration' (as set forth in the instruments
relating thereto, without regard to any provision contained therein for a
subsequent adjustment of such consideration) payable to the Company upon the
exercise of such Options, Rights or the conversion or exchange of such
Convertible Securities, by

     

    (2) the
maximum number of shares of Common Stock (as set forth in the instruments
relating thereto, without regard to any provision contained therein

     


    
      
        
          Mid:  010056\000010\583382.1

          I-3

          Exhibit
I

        

         


      

      
         


        
          

        

      

      
         


      

    


    for a
subsequent adjustment of such number) issuable upon the exercise of such
Options, Rights or the conversion or exchange of such Convertible
Securities.

     

    6.  Adjustment for Stock Splits and
Combinations. If the Company shall at any time or from time to time after
the Original Issue Date effect a subdivision of the outstanding Common Stock,
the Purchase Price then in effect immediately before that subdivision shall be
proportionately decreased. If the Company shall at any time or from time to time
after the Original Issue Date combine the outstanding shares of Common Stock,
the Purchase Price then in effect immediately before the combination shall be
proportionately increased. Any adjustment under this paragraph shall become
effective at the close of business on the date the subdivision or combination
becomes effective.

     

    7.  Adjustment for Certain Dividends and
Distributions. In the event the Company at any time or from time to time
after the Original Issue Date shall make or issue a dividend or other
distribution payable in shares of Common Stock, then and in each such event the
Purchase Price shall be decreased as of the time of such issuance, by
multiplying the Purchase Price by a fraction, the numerator of which shall be
the total number of shares of Common Stock issued and outstanding immediately
prior to the time of such issuance, and the denominator of which shall be the
total number of shares of Common Stock issued and outstanding immediately prior
to the time of such issuance plus the number of shares of Common Stock issuable
in payment of such dividend or distribution.

     

    8.  Adjustments for Other Dividends and
Distributions. In the event the Company at any time, or from time to time
after the Original Issue Date shall make or issue, a dividend or other
distribution payable in securities of the Company other than shares of Common
Stock, then and in each such event provision shall be made so that the Holders
shall receive upon exercise of the Warrant in addition to the number of shares
of Common Stock receivable thereupon, the amount of securities of the Company
that they would have received had the Warrants been exercised into Warrant
Shares on the date of such event and had thereafter retained such securities
receivable by them as aforesaid during such period given application to all
adjustments called for during such period, under this paragraph with respect to
the rights of the Holders.

     

    9.  Adjustment for Reclassification,
Exchange, or Substitution. If the Warrant Shares shall be changed into
the same or a different number of shares of any class or classes of stock,
whether by capital reorganization, reclassification, or otherwise (other than a
subdivision or combination of shares or stock dividend provided for above), then
and in each such event the Holder shall have the right thereafter to convert
such share into the kind and amount of shares of stock and other securities and
property receivable upon such reorganization, reclassification, or other change,
by holders of the number of shares of Common Stock into which the Warrant might
have been exercised immediately prior to such reorganization, reclassification,
or change, all subject to further adjustment as provided herein.

     

    10.  No Impairment. The Company
will not, by amendment of its Certificate of Incorporation or through any
reorganization, transfer of assets, consolidation, merger, dissolution, issue or
sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms to be observed or performed
hereunder by the

     


    
      
        
          Mid:  010056\000010\583382.1

          I-4

          Exhibit
I

        

         


      

      
         


        
          

        

      

      
         


      

    


    Company,
but will at all times in good faith assist in the carrying out of all the
provisions of this Exhibit I and in the
taking of all such action as may be necessary or appropriate in order to protect
the exercise rights of the Holders against impairment to the extent required
hereunder.

     

    11. Certificate as to Adjustments.
Upon the occurrence of each adjustment or readjustment of the Purchase
Price pursuant to this Exhibit I, the
Company at its expense shall promptly compute such adjustment or readjustment in
accordance with the terms hereof and shall file a certificate setting forth such
adjustment or readjustment and showing in detail the facts upon which such
adjustment or readjustment is based with its corporate records. The Company
shall, upon the reasonable written request of any Holder furnish or cause to be
furnished to such Holder a similar certificate setting forth (i) such
adjustments and readjustments, (ii) the Purchase Price then in effect, and (iii)
the number of shares of Common Stock and the amount, if any, of other property
which then would be received upon the exercise of this Warrant. Despite such
adjustment or readjustment, the form of each or all Warrants, if the same shall
reflect the initial or any subsequent Purchase Price, need not be changed in
order for the adjustments or readjustments to be valid in accordance with the
provisions of this Warrant, which shall control.

     


    
      
        
          Mid:  010056\000010\583382.1

          I-5

          Exhibit
I