Document:

Form of Common Stock Purchase Warrant Agreement with Laidlaw & Co. (UK) Ltd.

    Exhibit
      4.1

     

    VOID
      AFTER 5:00 P.M., EASTERN TIME,

    ON
      FEBRUARY 16, 2011

     

    THIS
      WARRANT AND THE SHARES OF COMMON STOCK UNDERLYING THIS WARRANT HAVE NOT BEEN
      REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
      ACT”),
      AND
      MAY NOT BE SOLD, PLEDGED, ASSIGNED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT
      TO
      AN EFFECTIVE REGISTRATION UNDER THE SECURITIES ACT OR IN A TRANSACTION THAT,
      IN
      THE OPINION OF COUNSEL TO CAPRIUS, INC., QUALIFIES AS AN EXEMPT TRANSACTION
      UNDER THE SECURITIES ACT AND THE RULES AND REGULATIONS PROMULGATED
      THEREUNDER.

     

    CAPRIUS,
      INC.

     

    COMMON
      STOCK PURCHASE WARRANT AGREEMENT

     

    CAPRIUS,
      INC., a Delaware corporation (the “Company”),
      hereby grants to Laidlaw & Co. (UK) Ltd. (the “Initial
      Holder”),
      subject to the terms set forth in this Common Stock Purchase Warrant Agreement
      (the “Warrant
      Agreement”),
      the
      right to exercise Common Stock Purchase Warrants (the “Warrants”)
      for
      the purchase from the Company, of up to 59,702 shares (the “Shares”)
      of the
      Company’s Common Stock, at an exercise price of $2.00 per share, subject to
      adjustment from time to time pursuant to Section 3 hereof (collectively, the
      “Exercise
      Prices”).
      The
      term “Common
      Stock”
means,
      unless the context otherwise requires, the Company’s Common Stock, par value
      $.01 per share, or other securities or property at the time deliverable upon
      the
      exercise of this Warrant.

     

    This
      Warrant is issued to the Initial Holder for an aggregate of 59,702 shares of
      Common Stock as partial consideration for services rendered by the Initial
      Holder to the Company, pursuant to a Financial Advisory Agreement, dated January
      11, 2005, between the Company and Laidlaw, and amendments thereto, dated
      February 9, 2005 and February 16, 2006, in connection with a placement of the
      Company’s securities that closed on February 17, 2006 (the
“Placement”).

     

    1.    Exercise.

     

    1.1    Timing
      of Exercise.
      The
      Warrants shall be exercisable at any time in whole or in part from time to
      time
      commencing as of February 17, 2006 and expiring at 5:00 P.M., New York time,
      on
      February 16, 2011 (the “Expiration
      Date”),
      subject to earlier termination as provided herein, and may not be exercised
      thereafter.

     

    1.2    Manner
      of Exercise.
      The
      purchase rights evidenced by this Warrant Agreement shall be exercised by the
      Initial Holder or any person permitted by Section 6 hereof (collectively, “the
Holder”),
      by
      surrendering this Warrant Agreement, together with the Notice of Exercise in
      the
      form of Exhibit
      A
      annexed
      hereto duly executed by the Holder, to the Company at the address in Section
      12
      hereof for sending of notices, accompanied by payment (in cash, by wire transfer
      or by certified or official bank check or checks) of the applicable Exercise
      Price.

     

    
      
        
        

      

      
         

        
          

        

      

      
        
        

      

    

     

    1.3    Net
      Issue Exercise.

     

    (a)    In
      lieu
      of making a monetary payment as provided in Section 1.2 hereof upon exercise,
      the Holder may elect, in its sole discretion, to receive shares of Common Stock
      equal to the value of Warrants then being exercised by surrender of this Warrant
      Agreement to the Company, together with the Notice of Exercise and notice of
      the
      net issue election. Thereupon, the Company shall issue to the Holder the number
      of Shares computed using the following formula:

     

    X
      =
      Y(A-B) / A

     

    Where:            X
      = the
      number of Shares to be issued to the Holder.

     

    Y=
      the
      number of Shares in respect of which the net issue exercise is
      sought.

     

    A=
      the
      current fair market value of one share of Common Stock.

     

    B=
      the
      Exercise Price at the time the net issue exercise is being made.

     

    (b)    For
      the
      purpose of this Section, the fair market value of the Shares shall mean with
      respect to each share of Common Stock:

     

    (i)    If
      the
      Shares are listed on any national securities exchange or quoted on the Nasdaq
      National Market, Nasdaq Small Cap Market or the OTC Bulletin Board, the average
      of the closing prices of the Shares, sold on the primary securities exchange
      or
      market on which the Shares are at the time listed or traded, on the ten (10)
      trading days immediately prior to the day the Notice of Exercise is received
      by
      the Company;

     

    (ii)   If
      the
      Shares are not quoted on any national securities exchange or quoted on the
      Nasdaq National Market, Nasdaq Small Cap Market or the OTC Bulletin Board,
      the
      average of the mean between the highest bid and lowest asked price on such
      a day
      in the domestic over-the-counter market as reported by the National Quotation
      Bureau or any similar successor organization, on the thirty (30) calendar days
      immediately prior to the day the Notice of Exercise is received by the
      Company;

     

    (iii)   If
      there
      is no public market for the Shares, the price determined by the Board of
      Directors of the Company acting in good faith.

     

    1.4    Partial
      Exercise.
      This
      Warrant may be exercised for less than the full number of Shares available
      for
      exercise at the time the Notice of Exercise is submitted, in which case the
      number of Shares receivable upon the exercise of this Warrant as a whole, and
      the amount payable upon the exercise of this Warrant as a whole, shall be
      proportionately reduced. Upon any such partial exercise, the Company at its
      expense will forthwith issue to the Holder a new Warrant Agreement of like
      tenor
      calling for Warrants to purchase the number of shares of Common Stock as to
      which rights have not been exercised. 

     

    2.    Delivery
      of Stock Certificates Upon Exercise.
      As soon
      as practicable after the exercise of any Warrants, and in any event within
      five
      (5) business days thereafter, the Company,

     

    
      
        
        

      

      
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    at
      its
      expense, will cause to be issued in the name of and delivered to the Holder
      a
      certificate or certificates for the number of fully paid and non-assessable
      shares of Common Stock to which the Holder shall be entitled upon such exercise,
      subject to compliance with Section 7 hereof. Any shares of Common Stock as
      to
      which this Warrant is exercised shall be deemed issued on and as of the date
      of
      such exercise, and the Holder shall thereupon be deemed to be the owner of
      record of such Shares.

     

    3.    Anti-Dilution
      Adjustments.

     

    3.1    Change
      in Capitalization.
      In case
      of any stock split (forward or reverse), stock dividend or similar transaction
      prior to the Expiration Date which increases or decreases the number of
      outstanding shares of Common Stock, appropriate adjustment shall be made by
      the
      Board of Directors of the Company to the number of Shares and the Exercise
      Price
      per Share of Common Stock which may be purchased under this Warrant
      Agreement.

     

    3.2    Reclassification.
      In case
      of any reclassification, capital reorganization or change of the outstanding
      Common Stock of the Company (other than as a result of a subdivision,
      combination or stock dividend covered by Section 3.1 hereof), at any time prior
      to the Expiration Date, 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 have the right prior to the
      expiration of this Warrant Agreement to purchase, at a total price not to exceed
      that payable upon the exercise of the unexercised portion of the Warrants,
      the
      kind and amount of shares of stock and other securities and property receivable
      upon such reclassification, reorganization or change, by a holder of the number
      of shares of Common Stock of the Company which might have been purchased by
      the
      Holder immediately prior to such reclassification, reorganization or change,
      and
      in any such case appropriate provisions shall be made with respect to the rights
      and interest of the Holder to the end that the provisions hereof (including
      without limitation, provisions for the adjustment of the Exercise Price and
      of
      the number of Shares purchasable upon exercise of the Warrants) shall thereafter
      be applicable in relation to any shares of stock and other securities and
      property thereafter deliverable upon exercise hereof.

     

    3.3    Consolidation,
      Merger and Sale of Assets.
      In case
      of any consolidation of the Company with or a merger of the Company into another
      corporation or in case of any sale or conveyance and to another corporation
      of
      the property of the Company as an entirety or substantially as an entirety,
      upon
      any such consolidation, merger, sale or conveyance (i) the surviving entity
      is a publicly traded company, and (ii) the consideration to be received by
      the holders of the Company’s Common Stock includes publicly traded equity
      securities in the surviving entity or parent corporation, the Company agrees
      that a condition of such transaction will be that the successor or purchasing
      corporation, as the case may be, shall assume the obligations of the Company
      hereunder in writing. In the case of any such consolidation, merger or sale
      or
      conveyance, the Holder shall have the right until the Expiration Date upon
      payment of the Exercise Price in effect immediately prior to such action, to
      receive the kind and amount of shares and other securities and/or property
      which
      it would have owned or have been entitled to receive after the happening of
      such
      consolidation, merger, sale or conveyance had this Warrant been exercised
      immediately prior to such action, subject to adjustments which shall be as
      nearly equivalent as may be practicable to the adjustments provided for in
      this
      Section 3. The

     

    
      
        
        

      

      
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    provisions
      of this Section 3.3 shall similarly apply to successive consolidations, mergers,
      sales or conveyances.

     

    3.4    Non-Public
      Successor.
      In case
      of any consolidation of the Company with or a merger of the Company into another
      corporation or in case of any sale or conveyance to another corporation of
      the
      property of the Company as an entirety or substantially as an entirety, upon
      any
      such consolidation, merger, sale or conveyance (i) the surviving entity is
      a non-publicly traded company, or (ii) the consideration to be received by
      the holders of the Company’s Common Stock does not include any publicly traded
      equity securities in the surviving entity or its parent corporation, the Company
      agrees that a condition of such transaction will be that the Company shall
      mail
      to the Holder at the earliest applicable time (and, in any event not less than
      ten (10) days before any record date for determining the persons entitled to
      receive the consideration payable in such transaction) written notice of such
      record date. Such notice shall also set forth facts as shall indicate the effect
      of such action (to the extent such effect may be known at the date of such
      notice) on the Exercise Price of and the kind and amount of the Shares and
      other
      securities and property deliverable upon exercise of this Warrant. Upon the
      closing of the transaction referenced in the foregoing notice, this Warrant
      Agreement to the extent then unexercised shall terminate.

     

    3.5    Exchanges
      and Distributions With Respect to Common Stock.
      If the
      Company shall exchange for its Common Stock or distribute with respect to its
      Common Stock other securities issued by it, the Company shall give notice
      thereof to the Holder, and the Holder shall have the right thereafter (until
      the
      Expiration Date) to exercise the Warrants for the kind and amount of shares
      of
      stock and other securities retained or received by a holder of the number of
      shares of Common Stock of the Company into which the Warrants might have been
      exercised immediately prior to such exchange or distribution, subject to
      adjustment as provided hereinabove.

     

    3.6    Officer’s
      Certificate.
      Whenever the Exercise Price per Share or the number of shares of Common Stock
      subject to this Warrant Agreement is adjusted, the Company shall promptly mail
      to the Holder a notice of adjustment. The notice of adjustment shall include
      a
      brief statement of the facts requiring the adjustment and the manner of
      computing it, and shall be certified by the chief financial officer of the
      Company. The determination of the adjustment shall be made by the Company in
      its
      sole discretion and shall be final and binding upon the Holder.

     

    4.    Shares
      to Be Fully Paid; Reservation of Capital Stock Issuable Upon Exercise of
      Warrants.
      The
      Company covenants and agrees that any Shares issued hereunder will, upon
      issuance, be fully paid and non-assessable and free from all taxes, liens and
      charges with respect to the issuance thereof. The Company shall at all times
      reserve and keep available out of its authorized but unissued capital stock,
      solely for the issuance and delivery upon the exercise of the Warrants, such
      number of its duly authorized shares of Common Stock as from time to time shall
      be issuable upon the exercise of the Warrants.

     

    5.    Fractional
      Shares.
      The
      Company shall not issue fractions of shares of Common Stock upon exercise of
      the
      Warrants or scrip in lieu thereof. If any fraction of a share of Common Stock
      would, except for the provisions of this Section 5, be issuable upon exercise
      of

     

    
      
        
        

      

      
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    the
      Warrants, then the number of shares of Common Stock to be issued shall be
      rounded up or down to the nearest whole share.

     

    6.    Transfer
      Restrictions.
      A
      Holder, including the Initial Holder or any subsequent Holder, may transfer
      this
      Warrant Agreement only to (i) any other Holder of Warrants that are part of
      the Series, (ii) any entity controlled by, controlling or under common
      control of the Holder, or for which the Holder is acting as the representative,
      or to one or more of its shareholders, directors, officers, members, employees
      or limited or general partners, or to entities that manage or co-manage the
      Holder or any of its limited or general partners, or (iii) any member of
      the immediate family (which shall be deemed to include a spouse, parent, or
      child) of an individual Holder or trust for the benefit of any such individual.
      Prior to any such transfer, the Holder must deliver the Assignment Form in
      the
      form of Exhibit
      B
      hereto
      and provide information to the Company, in writing, regarding the proposed
      transferee sufficient for the Company to determine the eligibility of such
      transferee under this Section 6.

     

    7.    Securities
      Law Compliance.

     

    7.1    Investment.
      Unless
      the Shares to be issued upon exercise of the Warrants are then included in
      an
      effective registration statement filed under the Securities Act of 1933, as
      amended (the “Securities
      Act”),
      the
      Holder, by accepting this Warrant Agreement, covenants and agrees that, at
      the
      time of exercise hereof, and at the time of any proposed transfer of Shares
      acquired upon exercise hereof, the Holder will deliver to the Company a written
      statement that the securities acquired by the Holder upon exercise hereof are
      for the account of the Holder or are being held by the Holder as trustee,
      investment manager, investment advisor or as any other fiduciary for the account
      of the beneficial owner or owners for investment and are not acquired with
      a
      view to, or for sale in connection with, any distribution thereof (or any
      portion thereof) and with no present intention (at any such time) of offering
      and distributing such securities (or any portion thereof), and including such
      other representations as may be reasonably requested by counsel to the Company.
      Further, the Holder shall comply with such provisions of applicable state
      securities laws as counsel to the Company or other counsel reasonably acceptable
      to the Company shall advise. The Holder shall have certain rights to include
      the
      Common Stock underlying this Warrant in a registration statement in accordance
      with Section 8 hereof.

     

    7.2    Legend.
      Unless
      the Shares issuable upon exercise of the Warrants are registered under the
      Securities Act, upon exercise of any part of the Warrants and the issuance
      of
      any of such Shares, the Company shall instruct its transfer agent to enter
      stop
      transfer orders with respect to such Shares, and all certificates representing
      the Shares issued upon exercise hereof shall bear on the face thereof
      substantially the following legend, insofar as is consistent with applicable
      law:

     

    “The
      shares of Common Stock represented by this Certificate have not been registered
      under the Securities Act of 1933, as amended, and may not be sold, offered
      for
      sale, assigned, transferred or otherwise disposed of unless registered pursuant
      to the provisions of that Act or an opinion of counsel to the Company is
      obtained stating that such disposition is in compliance with an available
      exemption from such registration.”

     

    
      
        
        

      

      
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    8.    Registration
      Under the Securities Act of 1933.

     

    8.1    Piggy-Back
      Rights.

     

    (a)    If
      at any
      time prior to the Expiration Date the Company proposes to register shares of
      its
      Common Stock under the Securities Act on any form for the registration of its
      Common Stock under the Securities Act (the “Registration
      Statement”)
      for
      the account of stockholders (other than a registration relating to (i) a
      registration of a stock option, stock purchase or compensation or incentive
      plan
      or of stock issued or issuable pursuant to any such plan, or a dividend
      investment plan; (ii) a registration of securities proposed to be issued in
      exchange for securities or assets of, or in connection with a merger or
      consolidation with, another corporation; or (iii) a registration of
      securities proposed to be issued in exchange for other securities of the
      Company) in a manner which would permit registration of the Shares for sale
      to
      the public under the Securities Act (a “Piggyback
      Registration”),
      it
      will at such time give prompt written notice to the Holder of its intention
      to
      do so and of the Holder’s rights under this Section 8.1. Such rights are
      referred to hereinafter as “Piggyback
      Registration Rights”.
      Upon
      the written request of the Holder to the Company made within ten (10) days
      after
      the giving of any such notice (which request shall specify the number of Shares
      intended to be disposed of by the Holder and the intended method of disposition
      thereof), the Company will include in the Registration Statement the Shares
      (the
“Registrable
      Shares”)
      which
      the Company has been so requested to register by the Holder, provided that
      the
      Company’s obligation shall continue after exercise of the Warrants, but it need
      not include any Shares in a Registration Statement filed after the Expiration
      Date.

     

    (b)    The
      Company shall include the Registrable Shares in the Registration Statement
      it
      files pursuant to a Registration Rights Agreement, dated February 16, 2006,
      by
      and among the Company and the purchasers in the Placement.

     

    (c)    If,
      any
      time after giving written notice of its intention to register any securities
      in
      a Piggyback Registration but prior to the effective date of the related
      Registration Statement filed in connection with such Piggyback Registration,
      the
      Company shall determine for any reason not to register such securities, the
      Company will give written notice of such determination to the Holder and
      thereupon shall be relieved of its obligation to register any Shares in
      connection with such Piggyback Registration.

     

    (d)    The
      Holder may elect in writing, not later than three (3) business days prior to
      the
      effectiveness of the Piggyback Registration not to have its Shares so included
      in connection with the Registration Statement.

     

    (e)    If
      the
      securities covered by the Registration Statement are to be underwritten, the
      Company shall not be required to include therein any of the Registrable Shares
      unless the Holder accepts the terms of the underwriting as agreed upon between
      the Company and the underwriters selected by it. If in the opinion of the
      managing underwriter, the registration of all, or a part of, the Shares which
      the Holder has requested to be included in the Registration Statement would
      adversely affect such public offering, then, (i) the Company shall be
      required to include in the underwriting only the number of Registrable Shares,
      if any, which the managing underwriter believes may be sold without causing
      such
      adverse effect, and the

     

    
      
        
        

      

      
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    number
      of
      shares of Common Stock that may be included in such registration shall be
      allocated among all selling stockholders, requesting to participate in such
      registration in proportion (as nearly as practicable) to the amount of shares
      of
      Common Stock owned by each selling stockholder (including the Holder), or
      (ii) the Company may require the selling shareholders (including the
      Holder) to delay any offering of the Shares for a period of up to ninety (90)
      days.

     

    (f)    The
      Company is obligated to file only one Registration Statement pursuant to this
      Section 8 which is declared effective under the Securities Act. The Piggyback
      Registration Rights under this Section 8 are the only rights granted by the
      Company to the Holder to include its Shares in a Registration
      Statement.

     

    8.2    Obligations
      of the Company.

     

    (a)    The
      Company shall comply with the requirements of this Section 8 at its own expense.
      That expense shall include, but not be limited to, legal, accounting,
      consulting, printing, federal and state filing fees, NASDAQ or Exchange fees,
      out-of-pocket expenses incurred by counsel, accountants and consultants retained
      by the Company, and miscellaneous expenses directly related to the Registration
      Statement. However, this expense shall not include the portion of any
      underwriting commissions, transfer taxes and any underwriter’s accountable and
      nonaccountable expense allowances attributable to the offer and sale of the
      Registrable Shares or the fees and expenses of counsel to the Holder, all of
      which expenses shall be borne by the Holder. The Company shall include in the
      Piggyback Registration, and the prospectus included therein, all information
      and
      materials necessary or advisable to comply with the applicable statutes and
      regulations so as to permit the public sale of the Registrable Shares by the
      Holder.

     

    (b)    The
      Company shall supply to the Holder a reasonable number of copies of the
      preliminary, final or other prospectus, all prepared in conformity with the
      requirements of the Securities Act and the rules and regulations promulgated
      thereunder, and such other documents as the Holder shall reasonably
      request.

     

    (c)    The
      Company shall cooperate with respect to (i) all necessary or advisable
      actions relating to the preparation and the filing of the Piggyback Registration
      and arising from the provisions of this Section 8, (ii) all reasonable
      efforts to establish an exemption from the provisions of the Securities Act
      or
      any other federal or state securities statutes, (iii) all necessary or
      advisable actions to register or qualify the public offering at issue pursuant
      to federal securities statutes and the state “blue sky” securities statutes of
      each jurisdiction that the Holder shall reasonably request, and (iv) all
      other necessary or advisable actions to enable the Holder of this Warrant and/or
      the Registrable Shares to complete the contemplated disposition of the Shares
      in
      each reasonably requested jurisdiction.

     

    (d)    The
      Company shall keep the Registration Statement to which this Section 8 applies,
      and all amendments thereto, effective and current under the Securities Act
      for a
      period that will terminate upon the earlier of (i) the date on which the
      Registrable Shares have been sold and (ii) the date on which the Shares may
      be
      sold pursuant to Rule 144(k) (the “Effectiveness
      Period”)
      and
      advise the Holder in writing when the Effectiveness Period has expired.
      Notwithstanding the foregoing, if the Company determines, in its good faith
      reasonable

     

    
      
        
        

      

      
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    judgment,
      that it should withdraw the Registration Statement because the Company is
      engaged in or in good faith plans to engage in any financing, acquisition or
      other material transaction which would be adversely affected by the maintenance
      of the Registration Statement otherwise required to be filed pursuant to this
      Section 8, or that the Company is in the possession of material nonpublic
      information required to be disclosed in such Registration Statement or an
      amendment or supplement thereto, the disclosure of which in such Registration
      Statement would be materially disadvantageous to the Company, the Company may
      withdraw the Registration Statement and shall promptly notify the Holder of
      the
      intention for the withdrawal and the reasons therefor.

     

    (e)    The
      Company shall indemnify and hold harmless the Holder from and against all
      losses, claims, damages, and liabilities, including, but not limited to,
      reasonable attorneys’ fees and any and all expenses reasonably incurred in
      investigating, preparing, defending or settling any claim, arising from or
      relating to (i) any untrue or alleged untrue statement of a material fact
      contained in Registration Statement to which this Section 8 applies, or
      (ii) any omission or alleged omission to state a material fact necessary to
      make the statements contained in Registration Statement to which this Section
      8
      applies not misleading; provided, however, that the indemnification continued
      in
      this clause shall not apply if the untrue statement or omission, or alleged
      untrue statement or omission, was the result of information furnished in writing
      to the Company by the Holder expressly for use in the Registration Statement
      at
      issue. To the extent that the indemnification contained in this provision
      applies, the Company also shall indemnify and hold harmless each officer,
      director, employee, controlling person or agent of an indemnified
      Holder.

     

    8.3    Obligations
      of the Holder.

     

    (a)    The
      Company’s obligations contained in this Section 8 shall be conditioned upon a
      timely receipt by the Company in writing of the following:

     

    (i)    Information
      as to the terms of the contemplated public offering furnished by and on behalf
      of the Holder intending to make a public distribution of Shares;
      and

     

    (ii)    Such
      other information as the Company may reasonably require from the Holder, or
      any
      underwriter for the Holder, for inclusion in the Piggyback
      Registration.

     

    (b)    The
      Holder shall indemnify the Company and its officers, directors and agents with
      respect to an untrue statement of material fact or omission of material fact
      which was the result of information furnished in writing to the Company from
      the
      Holder expressly for use in the Registration Statement.

     

    (c)    The
      Holder acknowledges that the Company shall have no obligation to include any
      Shares in a Piggyback Registration if the Shares then can be publicly sold
      pursuant to Rule 144 under the Securities Act.

     

    9.    Replacement
      of Warrant Agreement.
      Upon
      receipt of evidence reasonably satisfactory to the Company of the loss, theft,
      destruction or mutilation of this Warrant Agreement and (in the case of loss,
      theft or destruction) upon delivery of an indemnity agreement, and if requested
      by the Board of Directors, a bond in an amount reasonably

     

    
      
        
        

      

      
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    satisfactory
      to it, or (in the case mutilation) upon surrender and cancellation hereof,
      the
      Company will issue in lieu thereof a new Warrant Agreement of like
      tenor.

     

    10.    Rights
      as a Warrant Holder.
      The
      Holder shall not, by virtue hereof, be entitled to any rights of a stockholder
      in the Company, either at law or equity except with respect to certificates
      representing shares of Common Stock issued upon exercise of this Warrant
      Agreement. The rights of the Holder are limited to those expressed in this
      Warrant Agreement and are not enforceable against the Company except to the
      extent set forth herein. Prior to due presentment for transfer of this Warrant
      Agreement, the Company may deem and treat the Holder as the absolute owner
      of
      this Warrant Agreement for purposes of any exercise hereof and for all other
      purposes and such right of the Company shall not be affected by any notice
      to
      the contrary.

     

    11.    Subdivision
      of Rights.
      This
      Warrant Agreement (as well as any new Warrants issued pursuant to the provisions
      of this Section) is exchangeable upon the surrender hereof by the Holder at
      the
      principal office of the Company for any number of new Warrants of like tenor
      and
      date representing in the aggregate the right to subscribe for and purchase
      the
      number of shares of Common Stock of the Company that may be subscribed for
      and
      purchased hereunder.

     

    12.    Sending
      of Notices.
      All
      notices and other communications with respect to this Warrant Agreement shall
      be
      in writing and sent by express mail or courier service or by personal delivery,
      if to the Holder, to the address set forth at the end of this Warrant Agreement,
      and if to the Company, to One University Plaza, Hackensack, New Jersey 07601,
      or
      to such other address as either party hereto may duly give to the
      other.

     

    13.    Headings.
      The
      headings in this Warrant Agreement are for purposes of reference only and shall
      not limit or otherwise affect the meaning of the terms hereof.

     

    14.    Change,
      Waiver, Discharge or Termination.
      This
      Warrant Agreement sets forth the entire agreement between the Company and the
      Holder with respect to the matters herein. Neither this Warrant Agreement nor
      any term hereof may be changed, waived, discharged or terminated orally, but
      only by an instrument in writing signed by the party against which enforcement
      of the change, waiver, discharge or termination is sought. The Company shall
      not
      amend any other Warrant Agreement issued as part of this Series to make terms
      thereunder more favorable to the Holder thereof without offering the same
      amended terms to the Holder hereof.

     

    15.    Binding.
      This
      Warrant Agreement shall be binding upon and inure to the benefit of the Company
      and the Holder, and their respective successors and assigns.

     

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK]

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    16.    Governing
      Law.
      This
      Warrant Agreement shall be governed by, and construed in accordance with, the
      laws of the State of Delaware, without giving effect to principles of conflicts
      of law.

     

    

      
        	 	
                CAPRIUS,
                  INC.

              
	 	
                By:

              	
                 

              
	
                Dated:
                  February 17, 2006

              	 	
                Name:
                  Jonathan Joels

              
	 	 	
                Title:
                  Chief Financial Officer

              

      

    

     

    Agreed
      to:

     

    LAIDLAW
      & CO. (UK) LTD.

     

    
      	 By:	 	 
	 	 Name:	 
	 	 Title:	 

    

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    EXHIBIT
      A

    NOTICE
      OF EXERCISE

     

    (To
      be
      executed by a Holder desiring to exercise the right to purchase Shares pursuant
      to a Warrant.)

     

    The
      undersigned Holder of the attached Warrant Agreement hereby:

     

    1.    Irrevocably
      elects
      to
      exercise the Warrant therein by (please check the applicable
      blank):

     

    (a) _____
      Cash Exercise to the extent of purchasing ________ Shares at $_____, and makes
      payment in full of the aggregate Exercise Price for those Shares in the amount
      of $___________ by wire transfer or the delivery of certified funds or a bank
      cashier’s check; or

     

    (b) _____
      Net
      Issue Exercise pursuant to the provision of Section 1.3 for the purchase of
      ________ Shares at $_____, such Number of Shares and Exercise Price subject
      to
      Section 3 of the Warrant Agreement.

     

    2.    Requests
      that a certificate for the Shares be issued in the name of the undersigned,
      or,
      if the name and address of some other person is specified below, in the name
      of
      such other person:

    __________________________________________

    __________________________________________

    __________________________________________

    (Name,
      address and tax identification number of person other

    than
      the
      undersigned in whose name Shares are to be registered.)

     

    3.    Requests,
      if the number of Shares purchased are not all the Shares purchasable pursuant
      to
      the unexercised portion of the Warrants, that a new Warrant Agreement of like
      tenor for the remaining Shares purchasable pursuant to the Warrants be issued
      and delivered to the undersigned at the address stated below.

     

    
      	 Dated:	 	 	 
	 	 	 	 Signature

    

    
       

    

    (This
      signature must conform in all respects to the name of the Holder as specified
      on
      the face of the Warrant Agreement)

     

    
      	 	 	 
	 Social Security or Tax Identification
              Number	 	 Printed
              Name

    

     

    
      
        	 Address:	 	 
	 	 
	 Stock
                Warrant No.: ##

      

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    EXHIBIT
      B

    ASSIGNMENT
      FORM

     

    FOR
      VALUE RECEIVED, the
      undersigned,

    ________________________________,
      hereby sells, assigns and transfers unto:

     

    
      	Name:	 	 
	 (Please
              type or print in block letters.)	 
	 

    

    
      	Address:	 	 
	 	 
	 

    

    the
      right
      to purchase _______________ shares (the “Shares”) of Caprius, Inc. (the
“Company”) pursuant to the terms and conditions of the Warrant Agreement held by
      the undersigned. The undersigned hereby authorizes and directs the Company
      (i) to issue and deliver to the above-named assignee at the above address a
      new Warrant Agreement pursuant to which the rights to purchase being assigned
      may be exercised, and (ii) if there are rights to purchase Shares remaining
      pursuant to the undersigned’s Warrants after the assignment contemplated herein,
      to issue and deliver to the undersigned at the address stated below a new
      Warrant Agreement evidencing the right to purchase the number of Shares
      remaining after issuance and delivery of the Warrants to the above-named
      assignee. Except for the number of Shares purchasable, the new Warrant Agreement
      to be issued and delivered by the Company is to contain the same terms and
      conditions as the undersigned’s Warrant Agreement. This Assignment is subject to
      receipt by the Company of such investment representations by the assignee,
      as
      may be reasonably required under the Securities Act of 1933, as amended. To
      complete the assignment contemplated by this Assignment Form, the undersigned
      hereby irrevocably constitutes and appoints ________________________________
      as
      the undersigned’s attorney-in-fact to transfer the Warrants and the rights
      thereunder on the books of the Company with full power of substitution for
      these
      purposes.

     

    
      
        	 Dated:	 	 	 
	 	 	 	 Signature

      

      
         

      

      (This
        signature must conform in all respects to the name of the Holder as specified
        on
        the face of the Warrant Agreement)

       

      
        	 	 	 
	 Social Security or Tax Identification
                Number	 	 Printed
                Name

      

       

      
        
          	 Address:	 	 
	 	 
	 Stock
                  Warrant No.:
##Form of Option Agreement

    EXHIBIT
      10.1

    

    CERTIFICATE

    No.
      ________

     

    CAPRIUS,
      INC.

     

    STOCK
      OPTION AGREEMENT

     

    This
      Stock Option is granted to:

     

    

     

    
      	
              Name:

            	
              _______________
                (“Optionee” or “you”)

               

            
	
              Address:

            	
              _______________________

            

    

    

    in
      accordance with and pursuant to the terms of the 2002 Stock Option Plan (the
      “Plan”) of CAPRIUS, INC., a Delaware corporation (the “Company”).

     

    The
      terms
      of the Plan are incorporated by reference and shall be considered to be a part
      of this Stock Option Agreement. A copy of the Plan is attached hereto as
Exhibit
      A.
      Because
      this Option Agreement covers just the basic terms of your Stock Option, you
      should carefully review the Plan in order that you fully understand your rights
      regarding the Stock Option granted to you.

     

    1.    Grant.
      The Company hereby grants to you, the Optionee, a stock option (the “Option”)
      under the Plan to purchase all or any part of an aggregate of _________ shares
      (the “Option Shares”) of the Common Stock, $.01 par value (the “Common Stock”),
      of the Company, at an exercise price of $__________ per share, subject to
      adjustment in accordance with the terms and conditions set forth in Section
      13
      of the Plan. This Option is granted as of ___________ (the “Grant
      Date”).

     

    2.    Incentive
      Stock Option. This Option is intended to be an Incentive Stock Option
      ("ISO") within the meaning of §422(b) of the Internal Revenue Code of 1986, as
      amended (the "Code"). Under the Code, the grant to you of this Option is not
      considered a taxable event. You may have tax consequences at the time of
      exercise of the Option and you will have tax consequences at the time of
      disposition of the Option Shares. In addition, under Section 16 of the Plan
      you
      are required to give notice to the Company of any “disqualifying disposition” of
      the Option Shares. 

     

    Or

    

                 Non-Qualified
      Stock
      Option.
      This
      Option is a Non-Qualified Stock Option (i.e., it is not an incentive stock
      option within the meaning of Section 422 of the Internal Revenue Code of 1986,
      as amended (the “Code”).

     

    3.    Exercise.
      This Option, to the extent vested, shall be exercisable until __________ [2016],
      the day immediately preceding the [tenth] anniversary of the Grant Date subject
      to earlier termination upon the occurrence of an event described in Sections
      9
      and 10 of the Plan, or in connection with a Change in Control, as provided
      in
      Section 13.4 of the Plan. 

     

    4.    Vesting.
      You shall have the right to exercise this Option only to the extent of the
      Option Shares you are then vested in, subject to accelerated vesting and also
      subject to termination of vesting upon your termination of employment or
      cessation as service, as provided for in the Plan. Your vesting schedule is
      as
      follows: 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      
        	
                Number
                  of Option Shares

              	
                Date
                  Vested and Exercisable 

              
	 	 
	 	 
	 	 

      

       

    

    5.    Method
      of Exercise. You may exercise this Option, to the extent vested and
      exercisable, by completing and sending to the Company the Exercise Letter in
      the
      form attached hereto as Exhibit B. In this Exercise Letter you will identify
      the
      Option to be exercised and specify the number of Option Shares to be purchased,
      and also you will include payment by check payable to the Company, unless the
      Company has permitted you to make payment by some other means. Within five
      business days after due receipt of your Exercise Letter and payment, the Company
      will issue a certificate for the purchased Option Shares. The purchased Option
      Shares shall be fully-paid and non-assessable shares of the Common Stock of
      the
      Company.

     

    6.    Transfer.
      You may not transfer or assign this Stock Option Agreement or any rights in
      the
      Option granted herein except (i) by will or the laws of descent and
      distribution, (ii) pursuant to a qualified domestic relations order as defined
      in Section 414(p) of the Code or (iii) as otherwise provided in the Plan. The
      Option may be exercised only by you or your legal representative, as provided
      in
      the Plan. Any transfer or attempted transfer in violation of this Section may
      cause termination of the Option. 

     

    7.    No
      Implied Rights. Nothing contained in this Option Agreement or in the Plan
      shall (i) confer on you any right with respect to the terms of or continuation
      of your employment with the Company, or to interfere with the right of the
      Company to terminate your employment at any time, with or without cause (subject
      to any then existing employment agreement), or (ii) give you any rights to
      dividends, voting or other rights with respect to the Option Shares except
      as to
      Option Shares which are issued to you upon exercise hereunder.

     

    8.    Interpretation.
      The interpretation, construction, performance and enforcement of this Option
      Agreement and the Plan shall lie in the sole and absolute discretion of the
      Compensation Committee of the Board of Directors of the Company. Its
      determination shall be conclusive and binding on you, and shall be given the
      maximum deference permitted by law. Defined terms in this Option Agreement
      without definition shall have the meanings ascribed to them in the Plan. In
      the
      event of any discrepancy between the terms of this Option Agreement and the
      Plan, the terms of the Plan shall govern.

     

    9.    Binding.
      This Option shall be subject to exercise as provided herein and as provided
      by
      the terms of the Plan and shall, in accordance with such terms, be binding
      upon
      the Company and you.

     

    10.    Taxes.
      The Company is not making any representations to you, by way of this Option
      Agreement or otherwise, with respect to the actual tax consequences of your
      grant or exercise of this Option or any subsequent disposition of the Option
      Shares acquired upon exercise hereunder. You agree to make appropriate
      arrangements with the Company for the satisfaction of all federal, state and
      local income and employment tax withholding requirements applicable to the
      Option. You acknowledge and agree that the Company may refuse to honor the
      exercise and refuse to deliver the Option Shares if such withholding amounts,
      if
      required, are not delivered at the time of exercise.  

     

    11.    Governing
      Law. This Certificate shall be governed by and constituted in accordance
      with the laws of the State of Delaware, without regard to conflict of laws
      provisions.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    12.    Entire
      Agreement. This Stock Option Agreement and the Plan comprise the entire
      agreement with respect to the Option granted to you herein, and this Agreement
      cannot be amended or modified except in accordance with a writing executed
      by
      the Company and you.

     

    IN
      WITNESS WHEREOF, Caprius, Inc. has hereunto set its hand on the ___day of
      ________________ 2006.

     

    

    
      	 	
              CAPRIUS,
                INC.

               

               

            
	 	
              By:

            	
               

            
	 	 	
              Jonathan
                Joels

              CFO

            

    

     

     

    Agreed
      to:

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