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WARRANT AGREEMENT
BETWEEN
A.L. PHARMA INC.
AND
THE FIRST NATIONAL BANK OF BOSTON,
WARRANT AGENT
WARRANTS TO PURCHASE CLASS A COMMON STOCK
October 3, 1994
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This WARRANT AGREEMENT (the "Agreement") is dated as of October
3, 1994, between A.L. PHARMA INC., a Delaware corporation (the
"Company"), and THE FIRST NATIONAL BANK OF BOSTON, a national
banking association, as warrant agent (the "Warrant Agent").
WHEREAS, the Company proposes to issue Warrants (the "Warrants")
entitling the holders to purchase an aggregate of up to three
million, six hundred thousand (3,600,000) shares ("Shares") of
the Company's Class A Common Stock, $.20 par value (the "Class A
Common Stock"); and
WHEREAS, the Warrant Agent, at the request of the Company, has
agreed to act as the agent of the Company in connection with the
issuance, registration, transfer, exchange and exercise of
Warrants;
NOW, THEREFORE, in consideration of the premises and mutual
agreements herein set forth, the parties hereto agree as follows:
Section 1. Appointment of Warrant Agent. The Company
hereby appoints the Warrant Agent to act as agent for the Company
in accordance with the instructions hereinafter set forth; and
the Warrant Agent hereby accepts such appointment, upon the terms
and conditions hereinafter set forth.
Section 2. Amount Issued. Subject to the provisions of
this Agreement, Warrants to purchase no more than three million,
six hundred thousand (3,600,000) Shares may be issued and
delivered by the Company hereunder.
Section 3. Form of Warrant Certificates. The certificates
evidencing the Warrants (the "Warrant Certificates") to be
delivered pursuant to this Agreement shall be in registered form
only. The Warrant Certificates and the forms of election to
purchase Shares and of assignment to be printed on the reverse
thereof shall be in substantially the form set forth in Exhibit A
hereto together with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted
by this Agreement, and may have such letters, numbers or other
marks of identification and such legends or endorsements placed
thereon as may be required to comply with any law or with any
rules made pursuant thereto or with any rules of any securities
exchange, any agreement between the Company and any
Warrantholder, or as may, consistently herewith, be determined by
the officers executing such Warrants, as evidenced by their
execution of the Warrants.
Section 4. Execution of Warrant Certificates. Warrant
Certificates shall be signed on behalf of the Company by its
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Chairman of the Board of Directors, its President, a Vice
President or its Treasurer and attested by its Secretary or
Assistant Secretary, under its corporate seal. Each such
signature upon the Warrant Certificates may be in the form of a
facsimile signature of the current or any future Chairman of the
Board, President, Vice President, Treasurer, Secretary or
Assistant Secretary and may be imprinted or otherwise reproduced
on the Warrant Certificates and for that purpose the Company may
adopt and use the facsimile signature of any person who shall
have been Chairman of the Board, President, Vice President,
Treasurer, Secretary or Assistant Secretary, notwithstanding the
fact that at the time the Warrant Certificates shall be
countersigned and delivered or disposed of such person shall have
ceased to hold such office. The seal of the Company may be in
the form of a facsimile thereof and may be impressed, affixed,
imprinted or otherwise reproduced on the Warrant Certificates.
If any officer of the Company who shall have signed any of the
Warrant Certificates shall cease to be such officer before the
Warrant Certificates so signed shall have been countersigned by
the Warrant Agent or disposed of by the Company, such Warrant
Certificates nevertheless may be countersigned and delivered or
disposed of as though such person had not ceased to be such
officer of the Company; and any Warrant Certificate may be signed
on behalf of the Company by any person who, at the actual date of
the execution of such Warrant Certificate, shall be a proper
officer of the Company to sign such Warrant Certificate, although
at the date of the execution of this Agreement any such person
was not such officer.
Section 5. Registration and Countersignature. Warrant
Certificates shall be manually countersigned and dated the date
of countersignature by the Warrant Agent and shall not be valid
for any purpose unless so countersigned. The Warrants shall be
numbered and shall be registered in a register (the "Warrant
Register") to be maintained by the Warrant Agent.
The Warrant Agent's countersignature on all Warrants shall
be in substantially the form set forth in Exhibit A hereto.
The Company and the Warrant Agent may deem and treat the
registered holder of a Warrant Certificate as the absolute owner
thereof (notwithstanding any notation of ownership or other
writing thereon made by anyone), for the purpose of any exercise
thereof or any distribution to the holder thereof and for all
other purposes, and neither the Company nor the Warrant Agent
shall be affected by any notice to the contrary.
Section 6. Registration of Transfers and Exchanges. No
Warrant may be transferred prior to the Restricted Period
Termination Date except in a Permitted Transfer. Prior to the
Restricted Period Termination Date, the Warrant Agent shall not
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register the transfer of any outstanding Warrant Certificate
except a Permitted Transfer. Following the Restricted Period
Termination Date until the Close of Business on the Expiration
Date (as hereinafter defined), the Warrant Agent shall from time
to time register the transfer of any outstanding Warrant
Certificates in the Warrant Register, upon surrender of such
Warrant Certificates, duly endorsed, and, if not surrendered by
or on behalf of an original holder of Warrants or a Permitted
Transferee accompanied by a written instrument or instruments of
transfer in form satisfactory to the Warrant Agent, duly signed
by the registered holder or holders thereof or by the duly
appointed legal representative thereof or by a duly authorized
attorney, such signature to be guaranteed by (a) a bank or trust
company, (b) a broker or dealer that is a member of the National
Association of Securities Dealers, Inc. (the "NASD"), (c) a
member of a national securities exchange or (d) by an "eligible
guarantor institution" as defined under Rule 17Ad-15 promulgated
under the Securities Exchange Act of 1934, as amended. Upon any
such registration of transfer, a new Warrant Certificate shall be
issued to the transferee. For purposes of this Agreement the
"Restricted Period Termination Date" shall be the earlier of
October 3, 1995 or the date on which a registration statement
under the Securities Act of 1933, as amended (the "Securities
Act"), covering the Warrants and Shares shall have been declared
effective by the Securities and Exchange Commission (the "SEC"),
and such other action as may be required by federal or state law
relating to the issuance or distribution of securities shall have
been taken, except that with respect to Warrants issued to or
held by Einar W. Sissener or A/S Swekk or holders who acquire
such warrants from Einar W. Sissener or A/S Swekk in a Permitted
Transfer, the Restricted Period Termination Date shall be
October 3, 1997. For purposes of this Agreement a "Permitted
Transfer" shall be any of the following: (i) a transfer by
operation of law, (ii) a transfer pursuant to applicable laws of
descent and distribution, and (iii) a transfer to the owners of
an entity holder upon the liquidation of such entity; provided,
however, that the restrictions contained in this Section 6 and
elsewhere in this Agreement shall continue in effect with respect
to any Warrant in the hands of the transferee of a Permitted
Transfer. For purposes of this Agreement, the term "Permitted
Transferee" shall mean any holder who acquired Warrants in a
Permitted Transfer.
Warrant Certificates may be exchanged at the option of the
holder or holders thereof, when surrendered to the Warrant Agent
at its offices or agency maintained in New York, New York (or at
such other offices or agencies as may be designated by the Agent)
for the purpose of exchanging, transferring and exercising the
Warrants (a "Warrant Agent Office,") or at the offices of any
successor Warrant Agent as provided in Section 18 hereof, for
another Warrant Certificate or other Warrant Certificates of like
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tenor and representing in the aggregate a like number of
Warrants.
The Warrant Agent is hereby authorized to countersign, in
accordance with the provisions of Section 5 and of this Section
6, and deliver the new Warrant Certificates required pursuant to
the provisions of this Section, and for the purpose of any
distribution of Warrant Certificates contemplated by Section 13.
For purposes of this Agreement, "Affiliate" or "affiliate"
means, with respect to any person, (i) any other person or entity
controlling, controlled by or under common control with such
person, and (ii) any officer, director, partner, trustee,
beneficiary or employee of any person referred to in clause (i)
above.
Section 7. Duration and Exercise of Warrants. The Warrants
shall expire at (a) 5:00 p.m. New York City Time (the "Close of
Business") on January 3, 1999 or (b) the Close of Business on
such later date as shall be determined in the sole discretion of
the Company in a written statement to the Warrant Agent and with
notice to registered holders of Warrants in the manner provided
for in Section 15 (such date of expiration being hereinafter
referred to as the "Expiration Date"). The Warrants shall not be
exercisable prior to the Restricted Period Termination Date. At
such time as the Warrants become exercisable, and thereafter
until the Close of Business on the Expiration Date, the Warrants
may be exercised on any business day. After the Close of
Business on the Expiration Date, the Warrants will become void
and of no value.
Subject to the provisions of this Agreement, including
Section 13, each Warrant shall entitle the holder thereof to
purchase from the Company (and the Company shall issue and sell
to such holder of a Warrant) one fully paid and nonassessable
Share at the price of $21.9450 (U.S.) (such price, as may be
adjusted from time to time as provided in Section 13, being the
"Exercise Price"). The holder of a Warrant shall exercise such
holder's right to purchase Shares by depositing with the Warrant
Agent at a Warrant Agent Office the Warrant Certificate
evidencing such Warrant, with the form of election to purchase on
the reverse thereof duly completed and signed by the registered
holder or holders thereof or by the duly appointed legal
representative thereof or by a duly authorized attorney, such
signature (if not signed by or on behalf of an original holder of
Warrants or a Permitted Transferee) to be guaranteed in the
manner described in Section 6 hereof, and paying to the Warrant
Agent in lawful money of the United States of America by wire
transfer of immediately available funds or by certified check or
official bank check an amount equal to the Exercise Price
multiplied by the number of Shares in respect of which such
Warrants are being exercised.
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Subject to Section 9, upon such surrender of a Warrant
Certificate and payment of the Exercise Price, the Warrant Agent
shall requisition from the Company's Class A Common Stock
transfer agent (the "Transfer Agent") for issuance and delivery
to or upon the written order of the registered holder of such
Warrant Certificate and in such name or names as such registered
holder may designate, a certificate or certificates for the Share
or Shares issuable upon the exercise of the Warrant or Warrants
evidenced by such Warrant Certificate. Such certificate or
certificates shall be deemed to have been issued and any person
so designated to be named therein shall be deemed to have become
the holder of record of such Share or Shares as of the date of
the surrender of such Warrant Certificate duly executed and
payment of the aggregate Exercise Price. The Warrants evidenced
by a Warrant Certificate shall be exercisable, at the election of
the registered holder thereof, either as an entirety or from time
to time for a portion of the number of Warrants specified in the
Warrant Certificate. If less than all of the Warrants evidenced
by a Warrant Certificate surrendered upon the exercise of
Warrants are exercised at any time prior to the Expiration Date,
a new Warrant Certificate or Certificates shall be issued for the
number of Warrants evidenced by the Warrant Certificate so
surrendered that have not been exercised, and the Warrant Agent
is hereby authorized to countersign such new Warrant Certificate
or Certificates pursuant to the provisions of Section 6 and this
Section 7.
The Warrant Agent shall account promptly to the Company with
respect to Warrants exercised and concurrently pay or deliver to
the Company all moneys and other consideration received by it
upon the purchase of Shares through the exercise of Warrants.
Section 8. Cancellation of Warrants. If the Company shall
purchase or otherwise acquire Warrants, the Warrant Certificates
representing such Warrants shall thereupon be delivered to the
Warrant Agent and be cancelled by it and retired. The Warrant
Agent shall cancel all Warrant Certificates surrendered for
exchange, substitution, transfer or exercise in whole or in part.
Warrant Certificates so cancelled shall be delivered by the
Warrant Agent to the Company from time to time upon request.
Section 9. Payment of Taxes. The Company will pay all
documentary stamp taxes attributable to the initial issuance of
Warrants and of Shares upon the exercise of Warrants; provided,
that the Company shall not be required to pay any tax or taxes
which may be payable in respect of any transfer involved in the
issue of any Warrant Certificates or any certificates for Shares
in a name other than the registered holder of a Warrant
Certificate surrendered upon the exercise of a Warrant, and the
Company shall not be required to issue or deliver such
certificates unless or until the person or persons requesting the
issuance thereof shall have paid to the Company the amount of
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such tax or shall have established to the satisfaction of the
Company that such tax has been paid or adequate provision has
been made for the payment thereof.
Section 10. Mutilated or Missing Warrant Certificates. If
any of the Warrant Certificates shall be mutilated, lost, stolen
or destroyed, the Company may in its discretion issue, and the
Warrant Agent shall countersign and deliver, in exchange and
substitution for and upon cancellation of the mutilated Warrant
Certificate, or in lieu of and substitution for the Warrant
Certificate lost, stolen or destroyed, a new Warrant Certificate
of like tenor and representing an equivalent number of Warrants,
but only upon receipt of evidence satisfactory to the Company and
the Warrant Agent of such loss, theft or destruction of such
Warrant Certificate and indemnity or bond, if requested, also
satisfactory to them. Applicants for such substitute Warrant
Certificates shall also comply with such other reasonable
regulations and pay such other reasonable charges as the Company
or the Warrant Agent may prescribe.
Section 11. Reservation of Shares. For the purpose of
enabling it to satisfy any obligation to issue Shares upon
exercise of Warrants, the Company will at all times through the
Close of Business on the Expiration Date, reserve and keep
available, free from preemptive rights and out of its aggregate
authorized but unissued or treasury shares of Class A Common
Stock, the number of Shares deliverable upon the exercise of all
outstanding Warrants, and the Transfer Agent is hereby
irrevocably authorized and directed at all times to reserve such
number of authorized and unissued or treasury shares of Class A
Common Stock as shall be required for such purpose. The Company
will keep a copy of this Agreement on file with such Transfer
Agent and with every transfer agent for any shares of the
Company's capital stock issuable upon the exercise of Warrants
pursuant to Section 12. The Warrant Agent is hereby irrevocably
authorized to requisition from time to time from such Transfer
Agent stock certificates issuable upon exercise of outstanding
Warrants, and the Company will supply such Transfer Agent with
duly executed stock certificates for such purpose.
Before taking any action that would cause an adjustment
pursuant to Section 13 reducing the Exercise Price below the then
par value (if any) of the Shares issuable upon exercise of the
Warrants, the Company will take any corporate action that may, in
the opinion of its counsel, be necessary in order that the
Company may validly and legally issue fully paid and
nonassessable Shares at the Exercise Price as so adjusted.
The Company covenants that all Shares issued upon exercise
of the Warrants will, upon issuance in accordance with the terms
of this Agreement, be fully paid and nonassessable and free from
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all liens, charges and security interests created by or imposed
upon the Company with respect to the issuance thereof.
Section 12. Registration of Warrants and Shares and Stock
Exchange Listings; Prospectus Delivery. (a) The Company will
file with the SEC and use its best efforts to have declared
effective by the first anniversary of the issuance of the
Warrants a registration statement, on Form S-3 or such other form
as is then available for such use by the Company, covering all
Warrants and the Shares. The Company will use it best efforts to
keep such registration statement continuously effective from the
date on which it is first declared effective by the SEC through
the Close of Business ten (10) business days following the
Expiration Date; provided however, that if the Company has
received a written request from any person who in the judgment of
the Company may be deemed to be an affiliate of the Company, (as
that term is defined in Rule 144 promulgated under the Securities
Act) prior to the Expiration Date that any Shares acquired as the
result of the exercise of a Warrant are owned or deemed to be
owned by such affiliate and that such Shares will be owned or
will be deemed to be owned by such affiliate on and after the
Expiration Date, then the Company shall use its best efforts to
keep the registration statement provided for by this Section 12
effective for so long as necessary to permit sales of such Shares
to be made by such affiliate but in no event longer than the
second anniversary of the Expiration Date. So long as any
unexpired Warrants remain outstanding and if required in order to
comply with the Securities Act, the Company agrees that it will
file such post-effective amendments to the registration statement
provided for in this Section 12. So long as any Warrants remain
outstanding (and so long as necessary to permit affiliates to
sell Shares in the circumstances and subject to the limitations
described in the second preceding sentence), the Company will
take all necessary action (a) to obtain and keep effective any
and all permits, consents and approvals of government agencies
and authorities and to make filings under federal and state
securities acts and laws, which may be or become necessary in
connection with the issuance, sale, transfer and delivery of the
Warrant Certificates, the exercise of the Warrants and the
issuance, sale, transfer and delivery of the Shares issued upon
exercise of Warrants, and (b) to have the Warrants (no later than
the first anniversary of the issuance of the Warrants) and the
Shares (immediately upon their issuance upon exercise of
Warrants) listed for trading or quotation on the New York Stock
Exchange or, if such listing is in the opinion of the Company
impracticable, on one of the following securities exchanges or
securities markets, as the board of directors of the Company
deems appropriate to facilitate the trading of the Warrants: (i)
another national securities exchange; (ii) quotation on the
National Association of Security Dealers Automated Quotations
system ("NASDAQ") or the National Association of Security Dealers
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Automated Quotation/National Market System ("NASDAQ/NMS"); or
(iii) such other over-the-counter quotation system.
(b) On the date of its effectiveness and on the date of any
Warrant sale or exercise, the Registration Statement will comply
in all material respects with the applicable requirements of the
Securities Act and the rules and regulations thereunder; on the
date of its effectiveness, the Registration Statement will not
contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary in
order to make the statements therein not misleading; and, the
final prospectus contained in the Registration Statement, if not
filed pursuant to rule 424(b), will not, and on the date of any
filing pursuant to rule 424(b) and upon the date of any Warrant
sale or exercise or any resale by an affiliate, such final
prospectus (together with any supplement thereto) will not,
include any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading.
(c) The Company will indemnify and hold harmless, to the
fullest extent permitted by law, the holders of Warrants and
Shares and each person, if any, who controls each such holder
within the meaning of the Securities Act, from and against any
and all losses, damages, claims, liabilities, joint or several,
costs and expenses (including any amounts paid in any settlement
effected with the Company's consent) to which the holders or any
such controlling person may become subject under the Securities
Act, state securities or blue sky laws, common law or otherwise,
insofar as such losses, damages, claims, liabilities (or actions
or proceedings in respect thereof), costs or expenses arise out
of or are based upon (x) any untrue statement or alleged untrue
statement of any material fact contained in the registration
statement or included prospectus, as amended or supplemented, or
(y) the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances in which they
are made, not misleading, and the Company will reimburse the
holders and each such controlling person of the holders promptly
upon demand for any reasonable legal or any other expenses
incurred by them in connection with investigating, preparing to
defend or defending against or appearing as a third-party witness
in connection with such loss, claim, damage, liability, action or
proceeding; provided, however, that the Company will not be
liable to any holder in any such case to the extent, but only to
the extent, that any such loss, damage, liability, cost or
expenses arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission so made
in conformity with information about such holder furnished by
such holder or such controlling persons for use in the
preparation thereof, provided further, that the Company shall not
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be liable to any person who participates as an underwriter, in
the offering or sale of Registrable Securities or to any other
person, if any, who controls such underwriter, within the meaning
of the Securities Act, in any such case to the extent that any
such loss, claim, damage, liability (or action or proceeding in
respect thereof) or expense arises out of such person's failure
to send or give a copy of the final prospectus prepared by the
Company and made available to such persons, as the same may be
then supplemented or amended, to the person asserting an untrue
statement or alleged untrue statement or omission or alleged
omission at or prior to the written confirmation of the sale of
Registrable Securities to such person if such statement or
omission was corrected in such final prospectus. Such indemnity
shall remain in full force and effect regardless of any
investigation made by or on behalf of any holder or any
controlling person of the holder, and shall survive the transfer
of such securities by the holder. In the event that indemnity is
not available, the Company agrees to contribute to any and all
losses based on the relative faults of the parties involved as
well as other equitable factors which may be appropriate.
(d) Each holder of Warrants or Shares covered by any
registration statement contemplated by this Section 12 will
severally indemnify and hold harmless to the fullest extent
permitted by law, the Company and each person, if any, who
controls the Company within the meaning of the Securities Act,
from and against any and all losses, damages, claims,
liabilities, joint or several, costs and expenses (including any
amounts paid in any settlement effected with such holder's
consent) to which the Company or any such controlling person may
become subject under the Securities Act, state securities or blue
sky laws, common law or otherwise, insofar as such losses,
damages, claims, liabilities (or actions or proceedings in
respect thereof), costs or expenses arise out of or are based
upon (x) any untrue statement or alleged untrue statement of any
material fact contained in the registration statement or included
prospectus, as amended or supplemented, or (y) the omission or
alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in
light of the circumstances in which they are made, not
misleading, or (z) the failure of such holder to send or give a
copy of the final prospectus prepared by the Company and made
available to such holder to any person, and such holder will
reimburse the Company and each such controlling person of the
Company promptly upon demand for any reasonable legal or any
other expenses incurred by them in connection with investigating,
preparing to defend or defending against or appearing as a third-
party witness in connection with such loss, claim, damage,
liability, action or proceeding to the extent, but only to the
extent, that any such loss, damage, liability, cost or expense
arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission so made in
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conformity with information about such holder furnished by such
holder or such controlling persons for use in the preparation of
such registration statement, prospectus or preliminary prospectus
or any amendment thereof or supplement thereto. Each holder, by
accepting delivery of any Warrant, agrees to be bound by the
provisions of this Section 12(d). Such indemnity shall remain in
full force and effect regardless of any investigation made by or
on behalf of the Company or any controlling person of the
Company. In the event that indemnity is not available, each such
holder severally agrees to contribute to any and all losses based
on the relative faults of the parties involved as well as any
other equitable factors which may be appropriate.
(e) If requested by the original holders of not less than
25% of the outstanding Warrants, the Company and such holders
shall enter into an underwriting agreement with an investment
banking firm containing customary representations, warranties and
provisions relating to indemnification and contribution. In
addition, the Company shall use its reasonable efforts to
cooperate with such investment banking firm to facilitate any
such offering.
(f) The Company shall make available to the holders of
Warrants copies of the prospectus so that such holders may comply
with their prospectus delivery requirements.
(g) The Company shall pay all out-of-pocket expenses
incurred in connection with the Registration Statement including,
without limitation, all SEC and blue sky registration and filing
fees, printing expenses, transfer agents' and registrars' fees,
fees and disbursements of the Company's and the Warrant holders'
counsel (provided however that the Warrant holders are only
entitled to one counsel as a group selected by the holders of a
majority of the Shares) and accountants and fees and
disbursements of experts used by the Company in connection with
such registration, provided, that the Company shall not be
required to pay any underwriting discounts or commissions.
(h) The provisions of this Section 12 are for the benefit
of the holders of Warrants and persons who may be deemed to be
affiliates of the Company acquiring Shares upon the exercise of
Warrants and shall survive the expiration and/or exercise of the
Warrants.
Section 13. Adjustment of Exercise Price and Number of
Shares Purchasable or Number of Warrants. The Exercise Price,
the number of Shares purchasable upon the exercise of each
Warrant and the number of Warrants outstanding are subject to
adjustment from time to time upon the occurrence of the events
enumerated in this Section 13.
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(a) If the Company shall (i) pay a dividend on its shares
of Class A Common Stock in shares of either Class A Common Stock
or shares of the Company's Class B Common Stock, $.20 par value,
(ii) subdivide its outstanding shares of Class A Common Stock,
(iii) combine its outstanding shares of Class A Common Stock into
a smaller number of shares of Class A Common Stock or
(iv) reclassify the Class A Common Stock (including any such
reclassification in connection with a consolidation or merger in
which the Company is the continuing corporation), the number of
Shares purchasable upon exercise of each Warrant immediately
prior thereto shall be adjusted so that the holder of each
Warrant shall be entitled upon exercise to receive the kind and
number of Shares or other securities of the Company which such
holder would have owned or have been entitled to receive after
the happening of any of the events described above, had such
Warrant been exercised immediately prior to the happening of such
event or any record date with respect thereto. An adjustment
made pursuant to this paragraph (a) shall become effective
immediately after the effective date of such event retroactive to
the record date, if any, for such event. In addition, in the
event of any reclassification of the Class A Common Stock,
references in this Agreement to Class A Common Stock shall
thereafter be deemed to refer to the securities into which the
Class A Common Stock shall have been reclassified.
(b) If the Company shall issue rights, options or warrants
to all holders of its outstanding Class A Common Stock entitling
them for a period of 45 days or less to subscribe for or purchase
shares of Class A Common Stock at a price per share that is lower
than the market price per share of Class A Common Stock (as
defined in paragraph (f) below) as of the record date mentioned
below, the number of Shares thereafter purchasable upon the
exercise of each Warrant shall be determined by multiplying the
number of Shares theretofore purchasable upon exercise of each
Warrant by a fraction, (i) the numerator of which shall be the
number of shares of Class A Common Stock outstanding on the date
of issuance of such rights, options or warrants plus the number
of additional shares of Class A Common Stock offered for
subscription or purchase, and (ii) the denominator of which shall
be the number of shares of Class A Common Stock outstanding on
the date of issuance of such rights, options or warrants plus the
number of shares which the aggregate offering price of the total
number of shares of Class A Common Stock so offered would
purchase at the market price per share of Class A Common Stock at
such record date (the date of computation referenced in paragraph
(f) below). Such adjustment shall be made whenever such rights,
options or warrants are issued, and shall become effective
immediately on the date of issuance retroactive to the record
date for the determination of stockholders entitled to receive
such rights, options or warrants.
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For the purposes of adjustments required by paragraph (b) of
this Section 13, the shares of Class A Common Stock that the
holder of any outstanding rights, options or warrants shall be
entitled to subscribe for or purchase shall be deemed to be
issued and outstanding as of the date of sale, issuance or
distribution of such securities to the extent that an adjustment
has been made for such issuance pursuant to such paragraph (b),
and the consideration, if any, received by the Company therefor
shall be deemed to be the consideration received by the Company
for such securities, plus the consideration or premiums stated in
such securities to be paid for the shares of Class A Common Stock
covered thereby.
(c) If the Company shall distribute to all holders of its
shares of Class A Common Stock evidences of its indebtedness or
assets (excluding cash dividends or distributions payable out of
consolidated earnings or earned surplus and dividends or
distributions referred to in paragraph (a) above) or rights,
options or warrants or convertible or exchangeable securities
containing the right to subscribe for or purchase shares of Class
A Common Stock (excluding those referred to in paragraph (b)
above), then in each case the number of Shares thereafter
purchasable upon the exercise of each Warrant shall be determined
by multiplying the number of Shares theretofore purchasable upon
the exercise of each Warrant, by a fraction, (i) the numerator of
which shall be the then current market price per share of Class A
Common Stock (as defined in paragraph (f) below) on the date of
such distribution (the date of computation referenced in
paragraph (f) below), and (ii) the denominator of which shall be
the then current market price per share of Class A Common Stock
(as defined in paragraph (f) below) on the date of such
distribution (the date of computation referenced in paragraph (f)
below), less the then fair value (as determined in good faith
by the Board of Directors of the Company, whose determination
shall be conclusive and shall be evidenced by a resolution filed
with the Warrant Agent) of the portion of the assets or evidences
of indebtedness so distributed or of subscription rights, options
or warrants or convertible or exchangeable securities, in each
instance applicable to one share of Class A Common Stock. Such
adjustment shall be made whenever any such distribution is made,
and shall become effective on the date of distribution
retroactive to the record date for the determination of
stockholders entitled to receive such distribution.
(d) For the purpose of any computation under paragraph (b)
of this Section 13, the current or closing market price per share
of Class A Common Stock at any date shall be deemed to be the
average of the daily closing prices (determined as provided in
Section 14(c)) for the 15 consecutive trading days commencing 20
trading days before the date of such computation.
- 12 -
(e) Except for adjustments required by paragraph (k)
hereof, no adjustment in the number of Shares purchasable
hereunder shall be required unless such adjustment would require
an increase or decrease of at least one percent (1%) in the
number of Shares purchasable upon the exercise of each Warrant;
provided, however, that any adjustments which by reason of this
paragraph (e) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All
calculations shall be made to the nearest cent and to the nearest
one-hundredth of a share, as the case may be.
(f) Whenever the number of Shares purchasable upon the
exercise of each Warrant is adjusted as herein provided (whether
or not the Company then or thereafter elects to issue additional
Warrants in substitution for an adjustment in the number of
Shares as provided in paragraph (k) hereof), the Exercise Price
payable upon exercise of each Warrant shall be adjusted by
multiplying such Exercise Price immediately prior to such
adjustment by a fraction, the numerator of which shall be the
number of Shares purchasable upon the exercise of each Warrant
immediately prior to such adjustment and the denominator of which
shall be the number of Shares so purchasable immediately
thereafter.
(g) For the purpose of this Section 13, the term "shares of
Class A Common Stock" shall mean (i) the class of stock
designated as the Class A Common Stock of the Company at the date
of this Agreement, or (ii) any other class of stock resulting
from successive changes or reclassification of such shares
consisting solely of changes in par value, or from par value to
no par value, or from no par value to par value. If at any time,
as a result of an adjustment made pursuant to paragraph (a) or
(c) above, the holders of Warrants shall become entitled to
purchase any shares of the Company other than shares of Class A
Common Stock, thereafter the provisions of this Agreement with
respect to Shares, including, without limitation, the provisions
regarding adjustments to be made from time to time to the number
of such other shares so purchasable upon exercise of each Warrant
and the Exercise Price of such shares, shall apply as nearly as
practicable in an equivalent manner to such other shares.
(h) Upon the expiration of any rights, options, warrants or
conversion or exchange privileges, if any thereof shall not have
been exercised, the Exercise Price and the number of shares of
Class A Common Stock purchasable upon the exercise of each
Warrant shall, upon such expiration, be readjusted and shall
thereafter be such as it would have been had it been originally
adjusted (or had the original adjustment not been required, as
the case may be) as if (i) the only shares of Class A Common
Stock so issued were the shares of Class A Common Stock, if any,
actually issued or sold upon the exercise of such rights,
options, warrants or conversion or exchange rights and (ii) such
- 13 -
shares of Class A Common Stock, if any, were issued or sold for
the consideration actually received by the Company upon such
exercise plus the aggregate consideration, if any, actually
received by the Company for the issuance, sale or grant of all of
such rights, options, warrants or conversion or exchange rights
whether or not exercised; provided, that no such readjustment
shall have the effect of increasing the Exercise Price or
decreasing the number of shares by an amount in excess of the
amount of the adjustment initially made in respect to the
issuance, sale or grant of such rights, options, warrants or
conversion or exchange rights.
(i) The Company in its discretion may elect, on or after
the date of any adjustment required by paragraphs (a) and (b) of
this Section 13, to adjust the number of Warrants in substitution
for an adjustment in the number of Shares purchasable upon the
exercise of a Warrant. Each of the Warrants outstanding after
such adjustment of the number of Warrants shall be exercisable
for the same number of Shares as immediately prior to such
adjustment. Each Warrant held of record prior to such adjustment
of the number of Warrants shall become that number of Warrants
(calculated to the nearest hundredth) obtained by dividing the
Exercise Price in effect prior to adjustment of the Exercise
Price by the Exercise Price in effect after adjustment of the
Exercise Price. The Company shall notify the holders of Warrants
in the same manner as provided in the first paragraph of Section
15, of its election to adjust the number of Warrants, indicating
the record date for the adjustment, and, if known at the time,
the amount of the adjustment to be made. This record date may be
the date on which the Exercise Price is adjusted or any day
thereafter. Upon each adjustment of the number of Warrants
pursuant to this paragraph (i) the Company shall, as promptly as
practicable, cause to be distributed to holders of record of
Warrants on such record date Warrant Certificates evidencing,
subject to Section 14, the additional Warrants to which such
holders shall be entitled as a result of such adjustment, or, at
the option of the Company, shall cause to be distributed to such
holders of record in substitution and replacement for the Warrant
Certificates held by such holders prior to the date of
adjustment, and upon surrender thereof, if required by the
Company, new Warrant Certificates evidencing all the Warrants to
be issued, executed and registered in the manner specified in
Sections 4, 5 and 6 (and which may bear, at the option of the
Company, the adjusted Exercise Price) and shall be registered in
the names of the holders of record of Warrant Certificates on the
record date specified in the notice.
(j) Except as provided in paragraphs (a) and (b) of this
Section 13, no adjustment to the number of Shares which may be
purchased upon exercise of any Warrant in respect of any dividend
shall be made during the term of a Warrant or upon the exercise
of a Warrant.
- 14 -
(k) In case of any consolidation of the Company with or
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 or the
Company is a party to a merger or binding share exchange which
reclassifies or changes its outstanding Class A Common Stock, the
Company or such successor or purchasing corporation, as the case
may be, shall execute with the Warrant Agent an agreement, in
form and substance substantially equivalent to this Agreement,
that each holder of a Warrant shall have the right thereafter,
subject to terms and conditions substantially equivalent to those
contained in this Agreement, upon payment of the Exercise Price
in effect immediately prior to such action to purchase upon
exercise of each Warrant the kind and amount of shares and other
securities and property which such holder would have owned or
have been entitled to receive after the happening of such
consolidation, merger, sale or conveyance had such Warrant been
exercised immediately prior to such action. The Company shall
mail by first-class mail, postage prepaid, to each registered
holder of a Warrant, notice of the execution of any such
agreement. Such agreement shall provide for adjustments, which
shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Section 13. The provisions of
this paragraph (k) shall similarly apply to successive
consolidations, mergers, sales or conveyances. The Warrant Agent
shall be under no duty or responsibility to determine the
correctness of any provisions contained in any such agreement
relating either to the kind or amount of shares of stock or other
securities or property receivable upon exercise of Warrants or
with respect to the method employed and provided therein for any
adjustments and shall be entitled to rely upon the provisions
contained in any such agreement
(l) Irrespective of any adjustments in the Exercise Price
or the number or kind of shares purchasable upon the exercise of
the Warrants, Warrants theretofore or thereafter issued may
continue to express the same price and number and kind of shares
as are stated in the Warrants initially issuable pursuant to this
Agreement.
Section 14. Fractional Warrants and Fractional Shares.
(a) The Company shall not be required to issue fractions of
Warrants on any distribution of Warrants to holders of Warrant
Certificates pursuant to Section 13(k) or to distribute Warrant
Certificates that evidence fractional Warrants. In lieu of such
fractional Warrants there shall be paid to the registered holders
of the Warrant Certificates with regard to which such fractional
Warrants would otherwise be issuable, an amount in cash equal to
the same fraction of the current market value of a full Warrant.
For purposes of this Section 14(a), the current market value of a
Warrant shall be the closing price of one Warrant (as determined
- 15 -
pursuant to paragraph (c) below) for the trading day immediately
prior to the date on which such fractional Warrant would have
been otherwise issuable.
(b) Notwithstanding any adjustment pursuant to Section 13
in the number of Shares purchasable upon the exercise of a
Warrant, the Company shall not be required to issue fractions of
Shares upon exercise of the Warrants or to distribute
certificates which evidence fractional Shares. In lieu of
fractional Shares, there shall be paid to the registered holders
of Warrant Certificates at the time such Warrant Certificates are
exercised as herein provided an amount in cash equal to the same
fraction of the current market value of a share of Class A Common
Stock minus the equivalent fraction of the exercise price. For
purposes of this Section 14(b), the current market value of a
share of Class A Common Stock shall be the closing price of a
share of Class A Common Stock (as determined pursuant to
paragraph (c) below) for the trading day immediately prior to the
date of such exercise.
(c) The closing price for each day shall be the last sale
price, regular way, or, if no such sale takes place on such day,
the average of the closing bid and asked prices, regular way, for
such day, in either case as reported in the principal
consolidated transaction reporting system with respect to
securities listed or admitted to trading on the New York Stock
Exchange or, if the Warrants or Class A Common Stock, as the case
may be, are not listed or admitted to trading on such exchange,
as reported on the principal consolidated transaction reporting
system with respect to securities listed on the principal
national securities exchange on which the Warrants or Class A
Common Stock, respectively, is listed or admitted to trading, or
if the Warrants or Class A Common Stock, as the case may be, is
not listed or admitted to trading on any national securities
exchange, as reported on NASDAQ/NMS or, if the Warrants or Class
A Common Stock, as the case may be, is not listed or admitted to
trading on NASDAQ/NMS, as reported on NASDAQ.
Section 15. Notices to Warrantholders. Upon any adjustment
of the number of Shares purchasable upon exercise of each
Warrant, the Exercise Price or the number of Warrants outstanding
pursuant to Section 13, the Company within 20 calendar days
thereafter shall (i) cause to be filed with the Warrant Agent a
certificate of a firm of independent public accountants of
recognized standing selected by the Company (who may be the
regular auditors of the Company) setting forth the Exercise Price
and either the number of Shares purchasable upon exercise of each
Warrant or the additional number of Warrants to be issued for
each previously outstanding Warrant, as the case may be, after
such adjustment and setting forth in reasonable detail the method
of calculation and the facts upon which such adjustment was made,
which certificate shall be conclusive evidence of the correctness
- 16 -
of the matters set forth therein, and (ii) cause the Warrant
Agent to give to each of the registered holders of the Warrant
Certificates at such holder's address appearing on the Warrant
Register written notice of such adjustments by first-class mail,
postage prepaid. Where appropriate, such notice may be given in
advance and included as a part of the notice required to be
mailed under the other provisions of this Section 15.
If:
(a) the Company shall declare any dividend payable in
any securities upon its shares of Class A Common Stock or
make any distribution (other than a cash dividend declared
in the ordinary course) to the holders of its shares of
Class A Common Stock, or
(b) the Company shall offer to the holders of its
shares of Class A Common Stock any additional shares of
Class A Common Stock or securities convertible or
exchangeable into shares of Class A Common Stock or any
right to subscribe for or purchase Class A Common Stock, or
(c) there shall be a dissolution, liquidation or
winding up of the Company (other than in connection with a
consolidation, merger or sale of all or substantially all of
its property, assets and business as an entirety),
then the Company shall (i) cause written notice of such
event to be filed with the Warrant Agent and shall cause written
notice of such event to be given to each of the registered
holders of the Warrant Certificates at such holder's address
appearing on the Warrant Register, by first-class mail, postage
prepaid, and (ii) make a public announcement in a daily morning
English language newspaper of general circulation in New York
City, New York, and in a daily morning Norwegian language
newspaper of general circulation in Oslo, Norway, of such event,
such giving of notice and publication to be completed at least 10
calendar days (or 20 calendar days in any case specified in
clause (c) above) prior to the date fixed as a record date or the
date of closing the transfer books for the determination of the
stockholders entitled to such dividend, distribution or
subscription rights, or for the determination of stockholders
entitled to vote on such proposed dissolution, liquidation or
winding up. Such notice shall specify such record date or the
date of closing the transfer books, as the case may be. The
failure to give the notice required by this Section 15 or any
defect therein shall not affect the legality or validity of any
dividend, distribution, right, option, warrant, dissolution,
liquidation or winding up or the vote upon or any other action
taken in connection therewith.
- 17 -
Section 16. Merger, Consolidation or Change of Name of
Warrant Agent. Any corporation into which the Warrant Agent may
be merged or converted or with which it may be consolidated, or
any corporation resulting from any merger, conversion or
consolidation to which the Warrant Agent shall be a party, or any
corporation succeeding to the shareholder services business of
the Warrant Agent, shall be the successor to the Warrant Agent
hereunder without the execution or filing of any paper or any
further act on the part of any of the parties hereto, provided
that such corporation would be eligible for appointment as a
successor Warrant Agent under the provisions of Section 18. If
at the time such successor to the Warrant Agent shall succeed
under this Agreement, any of the Warrant Certificates shall have
been countersigned but not delivered, any such successor to the
Warrant Agent may adopt the countersignature of the original
Warrant Agent; and if at that time any of the Warrant
Certificates shall not have been countersigned, any successor to
the Warrant Agent may countersign such Warrant Certificates
either in the name of the predecessor Warrant Agent or in the
name of the successor Warrant Agent; in all such cases such
Warrant Certificates shall have the full force provided in the
Warrant Certificates and in this Agreement.
If at any time the name of the Warrant Agent shall be
changed and at such time any of the Warrant Certificates shall
have been countersigned but not delivered, the Warrant Agent
whose name has changed may adopt the countersignature under its
prior name; and if at that time any of the Warrant Certificates
shall not have been countersigned, the Warrant Agent may
countersign such Warrant Certificates either in its prior name or
in its changed name; and in all such cases such Warrant
Certificates shall have the full force provided in the Warrant
Certificates and in this Agreement.
Section 17. Warrant Agent. The Warrant Agent undertakes
the duties and obligations imposed by this Agreement upon the
following terms and conditions, by all of which the Company and
the holders of Warrants, by their acceptance thereof, shall be
bound:
(a) The statements contained herein and in the Warrant
Certificates shall be taken as statements of the Company, and the
Warrant Agent assumes no responsibility for the correctness of
any of the same except such as describe the Warrant Agent or
action taken or to be taken by it. Except as herein otherwise
provided, the Warrant Agent assumes no responsibility with
respect to the execution, delivery or distribution of the Warrant
Certificates.
(b) The Warrant Agent shall not be responsible for any
failure of the Company to comply with any of the covenants
contained in this Agreement or in the Warrant Certificates to be
- 18 -
complied with by the Company nor shall it at any time be under
any duty or responsibility to any holder of a Warrant to make or
cause to be made any adjustment in the Exercise Price or in the
number of Shares issuable upon exercise of any Warrant (except as
instructed by the Company), or to determine whether any facts
exist which may require any such adjustments, or with respect to
the nature or extent of or method employed in making any such
adjustments when made.
(c) The Warrant Agent may consult at any time with counsel
satisfactory to it (who may be counsel for the Company) and the
Warrant Agent shall incur no liability or responsibility to the
Company or any holder of any Warrant Certificate in respect of
any action taken, suffered or omitted by it hereunder in good
faith and in accordance with the opinion or the advice of such
counsel.
(d) The Warrant Agent shall incur no liability or
responsibility to the Company or to any holder of any Warrant
Certificate for any action taken in reliance on any notice,
resolution, waiver, consent, order, certificate or other paper,
document or instrument believed in good faith by it to be genuine
and to have been signed, sent or presented by the proper party or
parties.
(e) The Company agrees to pay to the Warrant Agent
reasonable compensation for all services rendered by the Warrant
Agent under this Agreement, to reimburse the Warrant Agent upon
demand for all expenses, taxes and governmental charges and other
charges of any kind and nature incurred by the Warrant Agent in
the performance of its duties, under this Agreement and to
indemnify the Warrant Agent and save it harmless against any and
all losses, liabilities and expenses, including judgments, costs
and reasonable counsel fees and expenses, for anything done or
omitted by the Warrant Agent arising out of or in connection with
this Agreement except as a result of its negligence or bad faith.
(f) The Warrant Agent shall be under no obligation to
institute any action, suit or legal proceeding or to take any
other action likely to involve expense unless the Company or one
or more registered holders of Warrant Certificates shall furnish
the Warrant Agent with reasonable security and indemnity for any
costs or expenses which may be incurred. All rights of action
under this Agreement or under any of the Warrants may be enforced
by the Warrant Agent without the possession of any of the Warrant
Certificates or the production thereof at any trial or other
proceeding related thereto, and any such action, suit or
proceeding instituted by the Warrant Agent shall be brought in
its name as Warrant Agent, and any recovery or judgment shall be
for the ratable benefit of the registered holders of the
Warrants, as their respective rights or interests may appear.
- 19 -
(g) The Warrant Agent, and any stockholder, director,
officer or employee thereof, may buy, sell or deal in any of the
Warrants or other securities of the Company or become pecuniarily
interested in any transaction in which the Company may be
interested, or contract with or lend money to the Company or
otherwise act as fully and freely as though they were not the
Warrant Agent under this Agreement, or a stockholder, director,
officer or employee of the Warrant Agent, as the case may be.
Nothing herein shall preclude the Warrant Agent from acting in
any other capacity for the Company or for any other legal entity.
(h) The Warrant Agent shall act hereunder solely as agent
for the Company, and its duties shall be determined solely by the
provisions hereof. The Warrant Agent shall not be liable for
anything which it may do or refrain from doing in connection with
this Agreement except for its own negligence or bad faith.
(i) The Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed,
acknowledged and delivered all such further and other acts,
instruments and assurances as may reasonably be required by the
Warrant Agent for the carrying out or performing the provisions
of this Agreement.
(j) The Warrant Agent shall not be under any responsibility
in respect of the validity of this Agreement or the execution and
delivery hereof (except the due execution hereof by the Warrant
Agent) or in respect of the validity or execution of any Warrant
Certificate (except its countersignature thereof), nor shall the
Warrant Agent by any act hereunder be deemed to make any
representation or warranty as to the authorization or reservation
of the Shares to be issued pursuant to this Agreement or any
Warrant Certificate or as to whether the Shares will when issued
be validly issued, fully paid and nonassessable or as to the
Exercise Price or the number of Shares issuable upon exercise of
any Warrant.
(k) The Warrant Agent is hereby authorized and directed to
accept instructions with respect to the performance of its duties
hereunder from the Chairman of the Board, the President, any Vice
President, the Treasurer, the Secretary or an Assistant Secretary
of the Company, and to apply to such officers for advice or
instructions in connection with its duties, and shall not be
liable for any action taken or suffered to be taken by it in good
faith in accordance with instructions of any such officer or in
good faith reliance upon any statement signed by any one of such
officers of the Company with respect to any fact or matter
(unless other evidence in respect thereof is herein specifically
prescribed) which may be deemed to be conclusively proved and
established by such signed statement.
- 20 -
Section 18. Change of Warrant Agent. If the Warrant Agent
shall resign (such resignation to become effective not earlier
than 60 days after the giving of written notice thereof to the
Company and the registered holders of Warrant Certificates) or
shall become incapable of acting as Warrant Agent or if the Board
of Directors of the Company shall by resolution remove the
Warrant Agent (such removal to become effective not earlier than
30 days after the filing of a certified copy of such resolution
with the Warrant Agent and the giving of written notice of such
removal to the registered holders of Warrant Certificates), the
Company shall appoint a successor to the Warrant Agent. If the
Company shall fail to make such appointment within a period of 30
days after such removal or after it has been so notified in
writing of such resignation or incapacity by the Warrant Agent or
by the registered holder of a Warrant Certificate (in the case of
incapacity), then the registered holder of any Warrant
Certificate may apply to any court of competent jurisdiction for
the appointment of a successor to the Warrant Agent. Pending
appointment of a successor to the Warrant Agent, either by the
Company or by such a court, the duties of the Warrant Agent shall
be carried out by the Company. Any successor Warrant Agent,
whether appointed by the Company or by such a court, shall be a
bank or trust company, in good standing, incorporated under the
laws of any state or of the United States of America. As soon as
practicable after appointment of the successor Warrant Agent, the
Company shall cause written notice of the change in the Warrant
Agent to be given to each of the registered holders of the
Warrant Certificates at such holder's address appearing on the
Warrant Register. After appointment, the successor Warrant Agent
shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named as Warrant
Agent without further act or deed. The former Warrant Agent
shall deliver and transfer to the successor Warrant Agent any
property at the time held by it hereunder and execute and
deliver, at the expense of the Company, any further assurance,
conveyance, act or deed necessary for the purpose. Failure to
give any notice provided for in this Section 18 or any defect
therein, shall not affect the legality or validity of the removal
of the Warrant Agent or the appointment of a successor Warrant
Agent, as the case may be.
Section 19. Warrantholder Not Deemed a Stockholder.
Nothing contained in this Agreement or in any of the Warrant
Certificates shall be construed as conferring upon the holders
thereof the right to vote or to receive dividends or to consent
or to receive notice as stockholders in respect of the meetings
of stockholders or for the election of directors of the Company
or any other matter, or any rights whatsoever as stockholders of
the Company.
Section 20. Delivery of Prospectus. If the Company is
required under applicable federal or state securities laws to
- 21 -
deliver a prospectus upon exercise of Warrants, the Company will
furnish to the Warrant Agent sufficient copies of a prospectus,
and the Warrant Agent agrees that upon the exercise of any
Warrant Certificate by the holder thereof, the Warrant Agent will
deliver to such holder, prior to or concurrently with the
delivery of the certificate or certificates for the Shares issued
upon such exercise, a copy of the prospectus.
Section 21. Notices to Company and Warrant Agent. Any
notice or demand authorized by this Agreement to be given or made
by the Warrant Agent or by any registered holder of any Warrant
Certificate to or on the Company shall be sufficiently given or
made if sent by mail, first-class or registered, postage prepaid,
addressed (until another address is filed in writing by the
Company with the Warrant Agent), as follows:
A.L. Pharma Inc.
One Executive Drive
Fort Lee, New Jersey 07024
If the Company shall fail to maintain such office or agency
or shall fail to give such notice of any change in the location
thereof, presentation may be made and notices and demands may be
served at the principal office of the Warrant Agent.
Any notice pursuant to this Agreement to be given by the
Company or by any registered holder of any Warrant Certificate to
the Warrant Agent shall be sufficiently given if sent by first-
class mail, postage prepaid, addressed (until another address is
filed in writing by the Warrant Agent with the Company), as
follows:
The First National Bank of Boston
150 Royall Street
Mail Stop 45-01-19
Canton, Massachusetts 02021
Attn: Shareholder Services Division
The Warrant Agent maintains a Warrant Agent Office at BancBoston
Trust Company of New York, 55 Broadway, New York, New York
10006.
Section 22. Supplements and Amendments. The Company and
the Warrant Agent may from time to time supplement or amend this
Agreement without the approval of any holders of Warrant
Certificates in order to cure any ambiguity, manifest error or
other mistake in this Agreement, or to correct or supplement any
provision contained herein that may be defective or inconsistent
with any other provision herein, or to make any other provisions
in regard to matters or questions arising hereunder that the
Company and the Warrant Agent may deem necessary or desirable and
- 22 -
that shall not adversely affect, alter or change the interests of
the holders of the Warrants in any material respect.
Any supplement or amendment of this Agreement which may not
be made by the Company and the Warrant Agent without the approval
of holders of Warrant Certificates pursuant to the preceding
paragraph shall require the approval of the holders of Warrant
Certificates entitled to purchase upon exercise thereof a
majority of the Shares which may be purchased upon the exercise
of all outstanding Warrant Certificates at the time that such
amendment or supplement is to be made. Notwithstanding the
foregoing, any amendment or supplement to this Agreement which
would change the Expiration Date to a date prior to January 3,
1999 or which would provide for an adjustment to either (i) the
number of Shares purchasable upon exercise of a Warrant or (ii)
the exercise price for which Shares are purchasable upon exercise
of a Warrant, in either case, in a manner not provided for in
this agreement and in a manner that would have a substantial
negative impact on the holders of Warrant Certificates, then such
amendment or supplement shall require the consent of the holders
of all Warrant Certificates.
Section 23. Successors. All the covenants and provisions
of this Agreement by or for the benefit of the Company or the
Warrant Agent shall bind and inure to the benefit of their
respective successors and assigns hereunder.
Section 24. Termination. This Agreement shall terminate at
the Close of Business on the Expiration Date. Notwithstanding
the foregoing, this Agreement will terminate on any earlier date
when all Warrants have been exercised. The provisions of Section
18 shall survive such termination.
Section 25. Governing Law. This Agreement and each Warrant
Certificate issued hereunder shall be deemed to be a contract
made under the laws of the State of New York and for all purposes
shall be construed in accordance with the internal laws of the
State of New York without regard to principles of conflict of law
or choice of laws of the State of New York or any other
jurisdiction which would cause the application of any laws other
than of the State of New York.
Section 26. Benefits of this Agreement. Nothing in this
Agreement shall be construed to give to any person or corporation
other than the Company, the Warrant Agent and the registered
holders of the Warrant Certificates any legal or equitable right,
remedy or claim under this Agreement, and this Agreement shall be
for the sole and exclusive benefit of the Company, the Warrant
Agent and the registered holders of the Warrant Certificates.
Section 27. Counterparts. This Agreement may be executed
in a number of counterparts and each of such counterparts shall
- 23 -
all for purposes be deemed to be an original, and such
counterparts shall together constitute but one and the same
instrument.
Section 28. Headings. The headings of sections of this
Agreement have been inserted for convenience of reference only,
are not to be considered a part hereof and shall in no way modify
or restrict any of the terms or provisions hereof.
* * * * *
- 24 -
IN WITNESS WHEREOF the parties hereto have caused this
Warrant Agreement to be executed and delivered as of the day and
year first above written.
A.L. PHARMA INC.
By /s/ Jeffrey E. Smith
Title: Chief Financial
Officer/Executive
Vice President
ATTEST:
/s/ Beth P. Hecht
THE FIRST NATIONAL BANK OF
BOSTON
By /s/ Katherine S.
Anderson
Title: Administration
Manager
ATTEST:
- 25 -
I:\AL-COMBO\CURRENT\WARRANT.013
EXHIBIT A
[FORM OF FACE OF WARRANT CERTIFICATE]
THIS WARRANT WAS ORIGINALLY ISSUED ON ______________,
1994 AND SUCH ISSUANCE WAS NOT REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), OR ANY STATE OR OTHER SECURITIES LAW. NEITHER
THIS WARRANT NOR THE CLASS A COMMON STOCK OBTAINABLE
UPON EXERCISE HEREOF MAY BE OFFERED OR SOLD, PLEDGED OR
OTHERWISE DISPOSED OF, EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND ANY
APPLICABLE STATE OR OTHER SECURITIES LAW COVERING SUCH
SECURITY OR PURSUANT TO AN EXEMPTION FROM SUCH
REGISTRATION REQUIREMENT. THE TRANSFER AND EXERCISE OF
THIS WARRANT ARE ALSO SUBJECT TO THE CONDITIONS ON
TRANSFER AND EXERCISE SPECIFIED IN THE WARRANT
AGREEMENT, DATED AS OF October 3, 1994 (AS AMENDED AND
MODIFIED FROM TIME TO TIME), BETWEEN THE ISSUER HEREOF
(THE "COMPANY") AND THE FIRST NATIONAL BANK OF BOSTON,
AS WARRANT AGENT; THE COMPANY AND THE WARRANT AGENT
EACH RESERVE THE RIGHT TO REFUSE THE TRANSFER OF THIS
WARRANT UNTIL SUCH CONDITIONS HAVE BEEN FULFILLED WITH
RESPECT TO SUCH TRANSFER. UPON WRITTEN REQUEST, A COPY
OF SUCH CONDITIONS SHALL BE FURNISHED BY THE COMPANY TO
THE HOLDER HEREOF WITHOUT CHARGE.
VOID AFTER JANUARY 3, 1999
No. C- WARRANT TO PURCHASE
SHARES OF CLASS A COMMON STOCK
A.L. PHARMA INC.
WARRANT TO PURCHASE CLASS A COMMON STOCK
This Warrant Certificate certifies that ________________ or
registered assigns, is the registered holder of a Warrant (the
"Warrant") of A.L. Pharma Inc., a Delaware corporation (the
"Company"), to purchase the number of shares (the "Shares") of
Class A Common Stock, $.20 par value (the "Class A Common
Stock"), of the Company set forth above. This Warrant expires at
the close of business on January 3, 1999 (the "Expiration Date"),
unless such date is extended at the option of the Company, and
entitles the holder to purchase from the Company the number of
fully paid and nonassessable Shares set forth above at the
initial exercise price of $21.9450 (the "Exercise Price"),
payable in lawful money of the United States of America.
Subject to the terms and conditions set forth herein and in
the Warrant Agreement referred to on the reverse hereof, this
Warrant may be exercised upon surrender of this Warrant
Certificate and payment of an amount equal to the Exercise Price
multiplied by the number of Shares to be purchased upon exercise
hereof at the office or agency of the Warrant Agent at BancBoston
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Trust Company of New York, 55 Broadway, New York, New York 10006
(the "Warrant Agent Office").
The Exercise Price and the number of Shares purchasable upon
exercise of this Warrant are subject to adjustment upon the
occurrence of certain events as set forth in the Warrant
Agreement. The holder hereof by accepting this Warrant
Certificate hereby acknowledges and consents to the restrictions
regarding transfer and exercise of this Warrant contained in the
Warrant Agreement.
No Warrant may be exercised prior to the earlier of October
3, 1995 or the date on which a registration statement under the
Securities Act covering the Warrants and the Shares shall have
been declared effective by the SEC, and such other action as may
be required by federal or state law relating to the issuance or
distribution of securities shall have been taken (the "Restricted
Period Termination Date"), or after the Close of Business on the
Expiration Date, unless the Company exercises its option to
extend such date. After the Close of Business on the Expiration
Date, the Warrants will become void and of no value.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS
WARRANT CERTIFICATE SET FORTH ON THE REVERSE HEREOF. SUCH
FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS
THOUGH FULLY SET FORTH AT THIS PLACE.
This Warrant Certificate shall not be valid unless manually
countersigned by the Warrant Agent.
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IN WITNESS WHEREOF, the Company has caused this Certificate
to be executed by its duly authorized officers, and the corporate
seal hereunto affixed.
Dated: ________________.
A.L. PHARMA INC.
By
Title
[Corporate Seal of A.L. Pharma
Inc.]
ATTEST:
By
Title
Countersigned:
THE FIRST NATIONAL BANK OF
BOSTON
AS WARRANT AGENT
By
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[Form of Reverse of Warrant Certificate]
A.L. PHARMA INC.
The warrant evidenced by this warrant certificate is part of
a duly authorized issue of Warrants to purchase a maximum of
three million, six hundred thousand (3,600,000) Shares of Class A
Common Stock issued pursuant to a Warrant Agreement, dated as of
October 3, 1994 (the "Warrant Agreement"), duly executed and
delivered by the Company and The First National Bank of Boston,
as Warrant Agent (the "Warrant Agent"). The Warrant Agreement
hereby is incorporated by reference in and made a part of this
instrument and is should be referred to for a description of the
rights, limitation of rights, obligations, duties and immunities
thereunder of the Warrant Agent, the Company and the holders (the
words "holders" or "holder" meaning the registered holders or
registered holder) of the Warrants. A copy of the Warrant
Agreement may be inspected at the Warrant Agent Office and is
available upon written request addressed to the Company. All
terms used herein that are defined in the Warrant Agreement have
the meanings assigned to them therein.
Warrants may be exercised to purchase Shares from the
Company before the Close of Business on the Expiration Date, at
the Exercise Price set forth on the face hereof, subject to
adjustment as described in the Warrant Agreement. The holder of
the Warrant evidenced by this Warrant Certificate may exercise
such Warrant by surrendering the Warrant Certificate, with the
form of election to purchase set forth hereon properly completed
and executed, together with payment of the aggregate Exercise
Price, in lawful money of the United States of America, and any
applicable transfer taxes, by wire transfer of immediately
available funds, certified check or official bank check at the
Warrant Agent Office.
In the event that upon any exercise of the Warrant evidenced
hereby the number of Shares actually purchased shall be less than
the total number of Shares purchasable upon exercise of the
Warrant evidenced hereby, there shall be issued to the holder
hereof, or such holder's assignee, a new Warrant Certificate
evidencing a Warrant to purchase the Shares not so purchased. No
adjustment shall be made for any cash dividends on any Shares
issuable upon exercise of this Warrant. After the Close of
Business on the Expiration Date, unexercised Warrants shall
become void and of no value.
The Company shall not be required to issue fractions of
Shares or any certificates that evidence fractional Shares. In
lieu of such fractional Shares, there shall be paid to holders of
the Warrant Certificates with regard to which such fractional
Shares would otherwise be issuable an amount in cash equal to the
same fraction of the current market value (as determined pursuant
to the Warrant Agreement) of a full Share minus the same fraction
of the exercise price.
Warrant Certificates, when surrendered at the Warrant Agent
Office by the registered holder thereof in person or by a legal
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representative or attorney duly authorized in writing, may be
exchanged, in the manner and subject to the limitations provided
in the Warrant Agreement, but without payment of any service
charge, for another Warrant Certificate or Warrant Certificates
of like tenor evidencing a Warrant to purchase in the aggregate a
like number of Shares.
Upon due presentment for registration of transfer of this
Warrant Certificate at the Warrant Agent Office, a new Warrant
Certificate or Warrant Certificates of like tenor and evidencing
a Warrant or Warrants to purchase in the aggregate a like number
of Shares shall be issued to the transferee in exchange for this
Warrant Certificate, subject to the limitations provided in the
Warrant Agreement, without charge, except for any tax or other
governmental charge imposed in connection therewith.
The Company and Warrant Agent may deem and treat the
registered holder hereof as the absolute owner of this Warrant
Certificate (notwithstanding any notation of ownership or other
writing hereon made by anyone) for the purpose of any exercise
hereof and for any other purposes, and neither the Company nor
the Warrant Agent shall be affected by any notice to the
contrary.
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ELECTION TO EXERCISE
(TO BE EXECUTED UPON EXERCISE OF THE WARRANT)
The undersigned hereby irrevocably elects to exercise the
right, represented by this Warrant Certificate to purchase
________ Shares and herewith tenders in payment for such Shares
$________ in lawful money of the United States of America, in
accordance with the terms hereof. The undersigned requests that
a certificate representing such Shares be registered and
delivered as follows:
Name
Address
Delivery Address (if different)
If such number of Shares is less than the aggregate number of
Shares purchasable hereunder, the undersigned requests that a new
Warrant Certificate representing the balance of such Shares be
registered and delivered as follows:
Name
Address
Delivery Address (if different)
Social Security or Other Signature
Taxpayer Identification
Number of Holder
Note: The above signature must correspond with
the name as written upon the face of this Warrant
Certificate in every particular, without
alteration or enlargement or any change
whatsoever. In addition, the signature of the
holder hereof must be guaranteed.
SIGNATURE
GUARANTEED:
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ASSIGNMENT
(TO BE EXECUTED BY THE REGISTERED HOLDER IF SUCH
HOLDER DESIRES TO TRANSFER THE WARRANT CERTIFICATE)
FOR VALUE RECEIVED, the undersigned registered holder hereby
sells assigns and transfers unto
Name of Assignee
Address of Assignee
this Warrant Certificate, together with all right, title and
interest therein, and does irrevocably constitute and appoint
________________ attorney, to transfer the within Warrant
Certificate on the books of the Warrant Agent, with full power of
substitution.
Dated Signature
Note: The above signature must
correspond with the name as written
upon the face of this Warrant
Certificate in every particular,
without alteration or enlargement or
any change whatsoever. In addition,
the signature of the holder hereof
must be guaranteed.
Social Security or Other Taxpayer
Identification Number of Holder
SIGNATURE GUARANTEED:
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