Document:

CPI Aerostructures, Inc. 8-K

 

Exhibit 10.3

 

CPI AEROSTRUCTURES, INC.

91
Heartland Blvd.

Edgewood,
New York 11717

 

 

 

 

 

July
7, 2016

 

 

 

 

Mr.
Douglas McCrosson

 

 

Dear
Mr. McCrosson:

 

Reference
is made to the Employment Agreement between you and CPI Aerostructures, Inc. (the “Company”), dated March 5, 2014,
as amended (the “Employment Agreement”).

 

The
Employment Agreement is hereby terminated. From and after the date hereof, the Employment Agreement will be of no further force
or effect, and the rights and obligations of each of you and the Company shall terminate.

 

Your
employment by the Company as its President and Chief Executive Officer will continue on an at-will basis at your current annual
base salary. Your bonus compensation for calendar year 2016 will be determined in accordance with Schedule A of the Employment
Agreement. Your base salary, incentive bonus plan and other compensation for calendar year 2017 and thereafter will determined
by the Compensation Committee of the Company’s Board of Directors.

 

Please
confirm your agreement with the foregoing by signing below where indicated.

 

 

	 	Sincerely, 
	 	 
	 	CPI
AEROSTRUCTURES, INC.
	 	 
	 	 
	 	 
	 	By:	 	 
	 	 	Vincent Palazzolo
	 	 	Chief Financial Officer 

  

	AGREED TO AND ACCEPTED:	 
	 	 
	 	 
	Douglas McCrossonCPI Aerostructures, Inc. 8-K

 

Exhibit 10.4

 

CPI AEROSTRUCTURES, INC.

91
Heartland Blvd.

Edgewood,
New York 11717

 

 

 

 

 

July
7, 2016

 

 

 

 

Mr.
Vincent Palazzolo

 

 

Dear
Mr. Palazzolo:

 

Reference
is made to the Employment Agreement between you and CPI Aerostructures, Inc. (the “Company”), dated December 16, 2009,
as amended (the “Employment Agreement”).

 

The
Employment Agreement is hereby terminated. From and after the date hereof, the Employment Agreement will be of no further force
or effect, and the rights and obligations of each of you and the Company shall terminate.

 

Your
employment by the Company as its Chief Financial Officer will continue on an at-will basis at your current annual base salary.
Your bonus compensation for calendar year 2016 will be determined in accordance with Schedule A of the Employment Agreement. Your
base salary, incentive bonus plan and other compensation for calendar year 2017 and thereafter will determined by the Compensation
Committee of the Company’s Board of Directors.

 

Please
confirm your agreement with the foregoing by signing below where indicated.

 

 

	 	Sincerely, 
	 	 
	 	CPI
AEROSTRUCTURES, INC.
	 	 
	 	 
	 	 
	 	By:	 	 
	 	 	Douglas McCrosson
	 	 	Chief Executive Officer 

  

	AGREED TO AND ACCEPTED:	 
	 	 
	 	 
	Vincent PalazzoloExhibit 4.1

 

THIS
PROMISSORY NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS AND
MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED, ASSIGNED OR OTHERWISE DISPOSED OF, AND NO TRANSFER OF THIS PROMISSORY NOTE WILL BE
MADE BY THE COMPANY OR ITS TRANSFER AGENT IN THE ABSENCE OF SUCH REGISTRATION OR AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY
THAT SUCH REGISTRATION IS NOT REQUIRED.

 

8%
SENIOR SECURED PROMISSORY NOTE

 

	$_______	Durham, North Carolina

June
, 2016 (the “Issue Date”)

 

FOR
VALUE RECEIVED, Icagen, Inc., a Delaware corporation (the “Company”), with its principal place of business
at 4222 Emperor Boulevard, Suite 350, Research Triangle Park, Durham, North Carolina 27703, its successors and assigns (the “Company”),
promises to pay to the order of _______________________________ (“Payee”), having an address at ________________
___________________________, the principal sum of __________________ Dollars ($___________) on June 30, 2017 (the “Maturity
Date”), together with interest on the principal amount hereof at the rate of 8% per annum, payable on the Maturity Date,
commencing on the Issue Date. Payments on both principal and interest are to be made in lawful money of the United States of America
unless Payee agrees to another form of payment.

 

1.              This Note is secured by and entitled to the benefit of a first priority lien granted by the Company on all of the current assets
of the Company (excluding the equity of Icagen-T, Inc. and the assets of Icagen-T, Inc.), as set forth in a Pledge and Security
Agreement, dated as of the date hereof, between the Payee and the Company (the “Pledge Agreement”), to which
Pledge Agreement reference is hereby made for a description of the collateral accepted as security for this Note, and the nature
and extent of the security and the rights of the Payee.

 

2.              This Note is one of a series of a minimum of One Million Dollars ($1,000,000) of notes being issued by and among the Company and
certain note investors (the “Investors”) as part of a unit offering. This Note and all obligations hereunder,
and the other Notes issued as part of this series to the Investors and all obligations thereunder, respectively, shall rank pari
passu with each other and shall be senior in right of payment to all other indebtedness of the Company.

 

3.              As used herein, a “Default” means a material default by the Company of this Note, the Note Purchase Agreement
dated the date hereof between the Company and Payee, or the Pledge Agreement issued by the Company to Payee on the date hereof.
Amounts not paid when due hereunder shall bear interest from the due date until such amounts are paid at the rate of one percent
(1%) per month; provided, however, that in the event such interest rate would violate any applicable usury law,
the default rate shall be the highest lawful interest rate permitted under such usury law. Upon the occurrence of a Default and
receipt of written notice by the Company from Payee of such Default, the principal and interest due hereunder shall be immediately
due and payable by the Company to Payee.

 

4.              Presentment, demand, protest or notice of any kind are hereby waived by the Company. The Company may not set off against any amounts
due to Payee hereunder any claims against Payee or other amounts owed by Payee to the Company.

 

5.               All rights and remedies of Payee under this Note are cumulative and in addition to all other rights and remedies available at
law or in equity, and all such rights and remedies may be exercised singly, successively and/or concurrently. Failure to exercise
any right or remedy shall not be deemed a waiver of such right or remedy.

 

6.              The Company agrees to pay all reasonable costs of collection, including attorneys' fees which may be incurred in the collection
of this Note or any portion thereof and, in case an action is instituted for such purposes, the amount of all attorneys' fees
shall be such amount as the court shall adjudge reasonable.

 

7.              This Note is made and delivered in, and shall be governed, construed and enforced under the laws of the State of New York.

 

8.              This Note shall be subject to prepayment, at the option of the Company, in whole or in part, at any time and from time to time,
without premium or penalty.

 

9.              This Note or any benefits or obligations hereunder may not be assigned or transferred by the Company.

 

	 	ICAGEN, INC.
	 	 	 
	 	By:	 
	 	Name:	Richard
    Cunningham
	 	Title:	Chief
    Executive OfficerExhibit 4.2

  

NEITHER THIS
WARRANT NOR THE SHARES OF COMMON STOCK ISSUABLE ON EXERCISE OF THIS WARRANT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OR ANY
OTHER SECURITIES LAWS (THE “ACTS”). NEITHER THIS WARRANT NOR THE SHARES OF COMMON STOCK PURCHASABLE HEREUNDER MAY
BE SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THIS WARRANT OR COMMON
STOCK PURCHASABLE HEREUNDER, AS APPLICABLE, UNDER THE ACTS, OR (B) AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE CORPORATION
THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACTS.

 

ICAGEN,
INC.

WARRANT AGREEMENT

 

VOID
AFTER 5:00 P.M. NEW YORK TIME, JUNE 30, 2021

Issue
Date: June 30, 2016

 

1.     Basic
Terms. This Warrant Agreement (the “Warrant”) certifies that, for value received, the registered holder specified
below or its registered assigns (“Holder”) is the owner of a warrant of Icagen, Inc., a Delaware corporation having
its principal place of business at 4222 Emperor Blvd., Suite 350, Durham, North Carolina 27703 (the “Corporation”),
subject to adjustments as provided herein, to purchase ___________ (_________) shares of the Common Stock, $.001 par value, of
the Corporation (the “Common Stock”) from the Corporation at the price per share shown below (the “Exercise
Price”).

 

Holder:

 

Exercise
Price per share:$3.50

 

Except
as specifically provided otherwise, all references in this Warrant to the Exercise Price and the number of shares of Common Stock
purchasable hereunder shall be to the Exercise Price and number of shares after any adjustments are made thereto pursuant to this
Warrant.

 

2.     Corporation’s
Representations/Covenants. The Corporation represents and covenants that the shares of Common Stock issuable upon the exercise
of this Warrant shall at delivery be fully paid and non-assessable and free from taxes, liens, encumbrances and charges with respect
to their purchase. The Corporation shall take any necessary actions to assure that the par value per share of the Common Stock
is at all times equal to or less than the then current Exercise Price per share of Common Stock issuable pursuant to this Warrant.
The Corporation shall at all times reserve and hold available sufficient shares of Common Stock to satisfy all conversion and
purchase rights of outstanding convertible securities, options and warrants of the Corporation, including this Warrant.

 

     

     

    

 

3.    Method
of Exercise; Fractional Shares.

 

This
Warrant is exercisable at the option of the Holder at any time by surrendering this Warrant, on any business day during the period
(the “Exercise Period”) beginning the business day after the issue date of this Warrant specified above and ending
at 5:00 p.m. (New York time) five (5) years after the issue date. To exercise this Warrant, the Holder shall surrender this Warrant
at the principal office of the Corporation or that of the duly authorized and acting transfer agent for its Common Stock, together
with the executed exercise form (substantially in the form of that attached hereto) and together with payment for the Common Stock
purchased under this Warrant The principal office of the Corporation is located at the address specified in Section 1 of this
Warrant; provided, however, that the Corporation may change its principal office upon notice to the Holder. Payment
shall be made by check payable to the order of the Corporation or by wire transfer. This Warrant is not exercisable with respect
to a fraction of a share of Common Stock. In lieu of issuing a fraction of a share remaining after exercise of this Warrant as
to all full shares covered by this Warrant, the Corporation shall either at its option (a) pay for the fractional share cash equal
to the same fraction at the fair market price for such share; or (b) issue scrip for the fraction in the registered or bearer
form which shall entitle the Holder to receive a certificate for a full share of Common Stock on surrender of scrip aggregating
a full share.

 

4.    Protection
Against Dilution.

 

If
the Corporation, with respect to the Common Stock, (1) pays a dividend or makes a distribution on shares of Common Stock that
is paid in shares of Common Stock or in securities convertible into or exchangeable for Common Stock (in which latter event the
number of shares of Common Stock initially issuable upon the conversion or exchange of such securities shall be deemed to have
been distributed), (2) subdivides outstanding shares of Common Stock, (3) combines outstanding shares of Common Stock into a smaller
number of shares, or (4) issues by reclassification of Common Stock any shares of capital stock of the Corporation, the Exercise
Price in effect immediately prior thereto shall be adjusted so that each Holder thereafter shall be entitled to receive the number
and kind of shares of Common Stock or other capital stock of the Corporation that it would have owned or been entitled to receive
in respect of this Warrant immediately after the happening of any of the events described above had this Warrant been converted
immediately prior to the happening of that event. An adjustment made in accordance with this section shall become effective immediately
after the record date, in the case of a dividend, and shall become effective immediately after the effective date, in the case
of a subdivision, combination, or reclassification. If, as a result of an adjustment made in accordance with this Section 4, the
Holder becomes entitled to receive shares of two or more classes of capital stock or shares of Common Stock and other capital
stock of the Corporation, the board of directors (whose determination shall be conclusive) shall determine the allocation of the
adjusted Exercise Rate between or among shares of such classes of capital stock or shares of Common Stock and other capital stock.

 

    	 	2	 

     

    

 

5.    Adjustment
for Reorganization, Consolidation, Merger.

 

In
the event of any consolidation or merger to which the Corporation is a party other than a consolidation or merger in which the
Corporation is the continuing corporation, or the sale or conveyance to another corporation of the property of the Corporation
as an entirety or substantially as an entirety or any statutory exchange of securities with another corporation (including any
exchange effected in connection with a merger of a third corporation into the Corporation) (each such transaction referred to
herein as “Reorganization”), no adjustment of exercise rights or the Exercise Price shall be made; provided,
however, the Holder shall thereupon be entitled to receive if the Holder chooses to exercise the Warrant within ten days
of the notice of the Reorganization and provision shall be made therefor in any agreement relating to a Reorganization, the kind
and number of securities or property (including cash) of the corporation resulting from such consolidation or surviving such merger
or to which such properties and assets shall have been sold or otherwise transferred or with whom securities have been exchanged,
which the Holder would have owned or been entitled to receive as a result of such Reorganization had this Warrant been exercised
immediately prior to such Reorganization (and assuming the Holder failed to make an election, if any was available, as to the
kind or amount of securities, property or cash receivable by reason of such Reorganization; provided that if the kind or amount
of securities, property or cash receivable upon such Reorganization is not the same for each share of Common Stock in respect
of which such rights of election shall not have been exercised (“non electing share”) then for the purpose of this
section the kind and amount of securities, property or cash receivable upon such Reorganization for each non electing share shall
be deemed to be the kind and amount so receivable per share by a plurality of the non electing shares). In any case, appropriate
adjustment shall be made in the application of the provisions herein set forth with respect to the rights and interests thereafter
of the Holder, to the end that the provisions set forth herein (including the specified changes and other adjustments to the conversion
rate) shall thereafter be applicable, as nearly as reasonably may be, in relation to any shares, other securities or property
thereafter receivable upon exercise of this Warrant. The provisions of this section similarly apply to successive Reorganizations.

 

6.    Notice
of Adjustment. On the happening of an event requiring an adjustment of the Exercise Price or the shares purchasable under
this Warrant, the Corporation shall, within thirty (30) business days, give written notice to the Holder stating the adjusted
Exercise Price and the adjusted number and kind of securities or other property purchasable under this Warrant resulting from
the event and setting forth in reasonable detail the method of calculation and the facts upon which the calculation is based.

 

7.    Dissolution,
Liquidation. In case of the voluntary or involuntary dissolution, liquidation or winding up of the Corporation (other than
in connection with reorganization, consolidation, merger, or other transaction covered by paragraph 5 above) is at any time proposed;
the Corporation shall give at least thirty days prior written notice to the Holder. Such notice shall contain: (a) the date on
which the transaction is to take place; (b) the record date (which shall be at least thirty (30) days after the giving of the
notice) as of which holders of Common Stock will be entitled to receive distributions as a result of the transaction; (c) a brief
description of the transaction, (d) a brief description of the distributions to be made to holders of Common Stock as a result
of the transaction; and (e) an estimate of the fair value of the distributions. On the date of the transaction, if it actually
occurs, this Warrant and all rights under this Warrant shall terminate.

 

    	 	3	 

     

    

 

8.    Rights
of Holder. The Corporation shall deliver to the Holder all notices and other information provided to its holders of shares
of Common Stock or other securities which may be issuable hereunder concurrently with the delivery of such information to the
holders. This Warrant does not entitle the Holder to any voting rights or, except for the foregoing notice provisions, any other
rights as a shareholder of the Corporation. No dividends are payable or will accrue on this Warrant or the shares of Common Stock
purchasable under this Warrant until, and except to the extent that, this Warrant is exercised. Upon the surrender of this Warrant
and payment of the Exercise Price as provided above, the person or entity entitled to receive the shares of Common Stock issuable
upon such exercise shall be treated for all purposes as the record holder of such shares as of the close of business on the date
of the surrender of this Warrant for exercise as provided above. Upon the exercise of this Warrant, the Holder shall have all
of the rights of a shareholder in the Corporation.

 

9.    Exchange
for Other Denominations. This Warrant is exchangeable, on its surrender by the Holder to the Corporation, for a new Warrant
of like tenor and date representing in the aggregate the right to purchase the balance of the number of shares purchasable under
this Warrant in denominations and subject to restrictions on transfer contained herein, in the names designated by the Holder
at the time of surrender.

 

10.   Substitution.
Upon receipt by the Corporation of evidence satisfactory (in the exercise of reasonable discretion) to it of the ownership of
and the loss, theft or destruction or mutilation of the Warrant, and (in the case or loss, theft or destruction) of indemnity
satisfactory (in the exercise of reasonable discretion) to it, and (in the case of mutilation) upon the surrender and cancellation
thereof, the Corporation will issue and deliver, in lieu thereof, a new Warrant of like tenor.

 

11.   Restrictions
on Transfer. Neither this Warrant nor the shares of Common Stock issuable on exercise of this Warrant have been registered
under the Securities Act or any other securities laws (the “Acts”). Neither this Warrant nor the shares of Common
Stock purchasable hereunder may be sold, transferred, pledged or hypothecated in the absence of (a) an effective registration
statement for this Warrant or Common Stock purchasable hereunder, as applicable, under the Acts, or (b) an opinion of counsel
reasonably satisfactory to the Corporation that registration is not required under such Acts. If the Holder seeks an opinion as
to transfer without registration from Holder’s counsel, the Corporation shall provide such factual information to Holder’s
counsel as Holder’s counsel reasonably requests for the purpose of rendering such opinion. Each certificate evidencing shares
of Common Stock purchased hereunder will bear a legend describing the restrictions on transfer contained in this paragraph unless,
in the opinion of counsel reasonably acceptable to the Corporation, the shares need no longer to be subject to the transfer restrictions.

 

12.   Transfer.
Except as otherwise provided in this Warrant, this Warrant is transferable only on the books of the Corporation by the Holder
in person or by attorney, on surrender of this Warrant, properly endorsed.

 

    	 	4	 

     

    

 

13.   Recognition
of Holder. Prior to due presentment for registration of transfer of this Warrant, the Corporation shall treat the Holder as
the person exclusively entitled to receive notices and otherwise to exercise rights under this Warrant. All notices required or
permitted to be given to the Holder shall be in writing and shall be given by first class mail, postage prepaid, addressed to
the Holder at the address of the Holder appearing in the records of the Corporation.

 

14.   Payment
of Taxes. The Corporation shall pay all taxes and other governmental charges, other than applicable income taxes, that may
be imposed with respect to the issuance of shares of Common Stock pursuant to the exercise of this Warrant.

 

15.  Headings.
The headings in this Warrant are for purposes of convenience in reference only, shall not be deemed to constitute a part of this
Warrant and shall not affect the meaning or construction of any of the provisions of this Warrant.

 

16.   Miscellaneous.
This Warrant may not be changed, waived, discharged or terminated except by an instrument in writing signed by the Corporation
and the Holder. This Warrant shall inure to the benefit of and shall be binding upon the successors and assigns of the Corporation.
Under no circumstances may this Warrant be assigned by the Holder.

 

17.   Governing
Law. This Warrant shall be governed by and construed in accordance with the laws of the State of North Carolina without giving
effect to its principles governing conflicts of law.

 

	 	ICAGEN,
    INC. 
	 	 	 
	 	By:	 
	 	 	Name:  Richard
    Cunningham
	 	 	Title:
    Chief Executive Officer

  

    	 	5	 

     

    

 

ICAGEN,
INC.

Form of Transfer

 

(To
be executed by the Holder to transfer the Warrant)

 

For
value received the undersigned registered holder of the attached Warrant hereby sells, assigns, and transfers the Warrant to the
Assignee(s) named below:

 

	Names
    of Assignee	 	Address	 	Taxpayer
    ID No.	 	Number
    of Shares subject to transferred Warrant
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 

 

The
undersigned registered holder further irrevocably appoints _____________________________ _____________________________________ attorney (with
full power of substitution) to transfer this Warrant as aforesaid on the books of the Corporation.

  

 

 

 

 

 

	Date:	 	 	 
	 	 	 	Signature

 

    	 	6	 

     

    

 

ICAGEN,
INC.

Exercise Form

 

(To
be executed by the Holder to purchase Common Stock pursuant to the Warrant)

 

The
undersigned holder of the attached Warrant hereby irrevocably elects to exercise purchase rights represented by such Warrant for,
and to purchase, ___________ shares of Common Stock of Icagen, Inc., a Delaware corporation for the cash payment for those shares.

  

The
undersigned requests that (1) a certificate for the shares be issued in the name of the undersigned and (2) if the number of shares
with respect to which the undersigned holder has exercised purchase rights is not all of the shares purchasable under this Warrant,
that a new Warrant of like tenor for the balance of the remaining shares purchasable under this Warrant be issued.

 

 

 

 

 

 

	Date:	 	 	 
	 	 	 	Signature

 

 

7

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