EXHIBIT 4.1
THIS WARRANT AND THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE OFFERED, SOLD,
ASSIGNED OR TRANSFERRED, IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
UNDER SAID ACT OR UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL
REASONABLY SATISFACTORY TO THE COMPANY THAT REGISTRATION UNDER SAID ACT IS NOT
REQUIRED.
Warrant No. -__
COMMON STOCK PURCHASE WARRANT
To Purchase ____________ Shares of Common Stock of
SPECTRUM PHARMACEUTICALS, INC.
THIS IS TO CERTIFY THAT _______________, or registered assigns (the
"Holder"), is entitled, during the Exercise Period (as hereinafter defined), to
purchase from Spectrum Pharmaceuticals, Inc., a Delaware corporation (the
"Company"), the Warrant Stock (as hereinafter defined and subject to adjustment
as provided herein), in whole or in part, at a purchase price of $10.00 per
share, all on and subject to the terms and conditions hereinafter set forth.
1. Definitions. As used in this Warrant, the following terms have the
respective meanings set forth below:
"Affiliate" means any person or entity that, directly or indirectly
through one or more intermediaries, controls or is controlled by or is under
common control with a person or entity, as such terms are used in and construed
under Rule 144 under the Securities Act. With respect to a Holder of Warrants,
any investment fund or managed account that is managed on a discretionary basis
by the same investment manager as such Holder will be deemed to be an Affiliate
of such Holder.
"Appraised Value" means, in respect of any share of Common Stock on any
date herein specified, the fair saleable value of such share of Common Stock
(determined without giving effect to the discount for (i) a minority interest or
(ii) any lack of liquidity of the Common Stock or to the fact that the Company
may have no class of equity registered under the Exchange Act) as of the last
day of the most recent fiscal month ending prior to such date specified, based
on the value of the Company on a fully-diluted basis, as determined by a
nationally recognized investment banking firm selected by the Company's Board of
Directors and having no prior relationship with the Company.
"Business Day" means any day except Saturday, Sunday and any day which
shall be a legal holiday or a day on which banking institutions in the State of
California generally are authorized or required by law or other government
actions to close.
"Change of Control" means the (i) acquisition by an individual or legal
entity or group (as set forth in Section 13(d) of the Exchange Act) of more than
one-half of the voting rights or equity interests in the Company; or (ii) sale,
conveyance, or other disposition of all or substantially all of the assets,
property or business of the Company or the merger into or consolidation with any
other corporation (other than a wholly owned subsidiary corporation) or
effectuation of any transaction or series of related transactions where holders
of the Company's voting securities prior to such transaction or series of
transactions fail to continue to hold at least 50% of the voting power of the
Company (or, if other than the Company, the successor or acquiring entity)
immediately following such transaction.
"Closing Date" means April 21, 2004.
"Commission" means the Securities and Exchange Commission or any other
federal agency then administering the Securities Act and other federal
securities laws.
"Common Stock" means (except where the context otherwise indicates) the
Common Stock, $0.001 par value per share, of the Company as constituted on the
Closing Date, and any capital stock into which such Common Stock may thereafter
be changed or converted, and shall also include (i) capital stock of the Company
of any other class (regardless of how denominated) issued to the holders of
shares of Common Stock upon any reclassification thereof which is also not
preferred as to dividends or assets on liquidation over any other class of stock
of the Company and which is not subject to redemption and (ii) shares of common
stock of any successor or acquiring corporation received by or distributed to
the holders of Common Stock of the Company in the circumstances contemplated by
Section 4.3.
"Current Market Price" means, in respect of any share of Common Stock on
any date herein specified,
(1) if there shall not then be a public market for the Common Stock, the
higher of
(a) the book value per share of Common Stock at such date, and
(b) the Appraised Value per share of Common Stock at such date,
or
(2) if there shall then be a public market for the Common Stock, the
average of the daily market prices for the five (5) consecutive trading days
immediately preceding such date. The daily market price for each such trading
day shall be (i) the closing bid price on such day on the principal stock
exchange (including the NASDAQ Stock Market) on which such Common Stock is then
listed or admitted to trading, or quoted, as applicable, (ii) if no sale takes
place on such day on any such exchange, the last reported closing bid price on
such day as officially quoted on any such exchange (including the NASDAQ Stock
Market), (iii) if the Common Stock is not then listed or admitted to trading on
any stock exchange, the last reported closing bid price on such day in the
over-the-counter market, as furnished by the National Association of Securities
Dealers Automatic Quotation System or the National Quotation Bureau, Inc., (iv)
if neither such corporation at the time is engaged in the business of reporting
such prices, as furnished by any similar firm then engaged in such business, or
(v) if there is no such firm, as
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furnished by any member of the NASD selected mutually by the holder of this
Warrant and the Company or, if they cannot agree upon such selection, as
selected by two such members of the NASD, one of which shall be selected by
holder of this Warrant and one of which shall be selected by the Company.
"Current Warrant Price" means, in respect of a share of Common Stock at
any date herein specified, the price at which a share of Common Stock may be
purchased pursuant to this Warrant on such date. Unless and until the Current
Warrant Price is adjusted pursuant to the terms herein, the initial Current
Warrant Price shall be $10.00 per share of Common Stock.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, or
any similar federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect from time to time.
"Exercise Period" means the period during which this Warrant is
exercisable pursuant to Section 2.1.
"Expiration Date" means April 20, 2009.
"GAAP" means generally accepted accounting principles in the United States
of America as from time to time in effect.
"NASD" means the National Association of Securities Dealers, Inc., or any
successor corporation thereto.
"Other Property" has the meaning set forth in Section 4.3.
"Person" means any individual, sole proprietorship, partnership, joint
venture, trust, incorporated organization, association, corporation, limited
liability company, institution, public benefit corporation, entity or government
(whether federal, state, county, city, municipal or otherwise, including,
without limitation, any instrumentality, division, agency, body or department
thereof).
"Purchase Agreement" means that certain Common Stock and Warrant Purchase
Agreement dated as of April 20, 2004 among the Company and the other parties
named therein, pursuant to which this Warrant was originally issued.
"Restricted Common Stock" means shares of Common Stock which are, or which
upon their issuance upon the exercise of any Warrant would be required to be,
evidenced by a certificate bearing the restrictive legend set forth in Section
3.2.
"Securities Act" means the Securities Act of 1933, as amended, or any
similar federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
"Trading Day" means any day on which the primary market on which shares of
Common Stock are listed is open for trading.
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"Transfer" means any disposition of any Warrant or Warrant Stock or of any
interest in either thereof, which would constitute a sale thereof within the
meaning of the Securities Act.
"Warrants" means this Warrant and all warrants issued upon transfer,
division or combination of, or in substitution for, any thereof. All Warrants
shall at all times be identical as to terms and conditions and date, except as
to the number of shares of Common Stock for which they may be exercised.
"Warrant Price" means an amount equal to (i) the number of shares of
Common Stock being purchased upon exercise of this Warrant pursuant to Section
2.1, multiplied by (ii) the Current Warrant Price.
"Warrant Stock" means the ____________ shares of Common Stock to be
purchased upon the exercise hereof, subject to adjustment as provided herein.
2. Exercise of Warrant.
2.1. Manner of Exercise. From and after the first anniversary of the
Closing Date, and until 5:00 P.M., New York time, on the Expiration Date (the
"Exercise Period"), the Holder may exercise this Warrant, on any Business Day,
for all or any part of the number of shares of Warrant Stock purchasable
hereunder.
In order to exercise this Warrant, in whole or in part, the Holder shall
deliver to the Company at its principal office or at the office or agency
designated by the Company as described in Section 10, (i) a written notice of
Holder's election to exercise this Warrant, which notice shall specify the
number of shares of Warrant Stock to be purchased, and which notice shall be
substantially in the form of the subscription form appearing at the end of this
Warrant as Exhibit A, duly executed by the Holder or its agent or attorney, (ii)
an investment representation letter in form and substance acceptable to the
Company and substantially in the form attached as Exhibit C executed by the
Holder, (iii) payment of the Warrant Price as provided herein and (iv) this
Warrant. Upon receipt thereof, the Company shall, as promptly as practicable,
and in any event within three Business Days thereafter, execute or cause to be
executed and deliver or cause to be delivered to the Holder a certificate or
certificates representing the aggregate number of full shares of Warrant Stock
issuable upon such exercise, together with cash in lieu of any fraction of a
share, as hereinafter provided. The stock certificate or certificates so
delivered shall be, to the extent possible, in such denomination or
denominations as the Holder shall request in the notice and shall be registered
in the name of the Holder or if permitted pursuant to the terms of this Warrant
such other name as shall be designated in the notice. This Warrant shall be
deemed to have been exercised and such certificate or certificates shall be
deemed to have been issued, and the Holder or any other Person so designated to
be named therein shall be deemed to have become a Holder of record of such
shares for all purposes, as of the date when the notice, together with the
payment of the Warrant Price and this Warrant, is received by the Company as
described above. If this Warrant shall have been exercised in part, the Company
shall, at the time of delivery of the certificate or certificates representing
Warrant Stock, deliver to the Holder a new Warrant evidencing the rights of the
Holder to purchase the unpurchased shares of Common Stock called for by this
Warrant, which new Warrant shall in all other respects be identical with this
Warrant, or at the request of the Holder, appropriate notation may be made on
this Warrant
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and the same returned to the Holder.
Payment of the Warrant Price may be made at the option of the Holder by:
(i) certified or official bank check payable to the order of the Company or (ii)
wire transfer of immediately available funds to the account of the Company. All
shares of Common Stock issuable upon the exercise of this Warrant pursuant to
the terms hereof shall be validly issued and, upon payment of the Warrant Price,
shall be fully paid and nonassessable and not subject to any preemptive rights.
2.2. Fractional Shares. The Company shall not be required to issue a
fractional share of Common Stock upon exercise of any Warrant. As to any
fraction of a share which the Holder of one or more Warrants, the rights under
which are exercised in the same transaction, would otherwise be entitled to
purchase upon such exercise, the Company shall pay an amount in cash equal to
the Current Market Price per share of Common Stock on the date of exercise
multiplied by such fraction.
2.3. Restrictions on Exercise Amount.
Unless a Holder delivers to the Company irrevocable written notice prior
to the date of issuance hereof or sixty-one days prior to the effective date of
such notice that this Section 2.3 shall not apply to such Holder, the Holder may
not acquire a number of shares of Warrant Stock to the extent that, upon such
exercise, the number of shares of Common Stock then beneficially owned by such
holder and its Affiliates and any other persons or entities whose beneficial
ownership of Common Stock would be aggregated with the Holder's for purposes of
Section 13(d) of the Exchange Act (including shares held by any "group" of which
the holder is a member, but excluding shares beneficially owned by virtue of the
ownership of securities or rights to acquire securities that have limitations on
the right to convert, exercise or purchase similar to the limitation set forth
herein) exceeds 4.99% of the total number of shares of Common Stock of the
Company then issued and outstanding. For purposes hereof, "group" has the
meaning set forth in Section 13(d) of the Exchange Act and applicable
regulations of the Commission, and the percentage held by the holder shall be
determined in a manner consistent with the provisions of Section 13(d) of the
Exchange Act. The Company shall have no obligation to verify compliance with
this Section 2.3, other than to issue shares of Warrant Stock in accordance with
the exercise notice of each Holder. It shall be the responsibility of each
Holder to determine such Holder's compliance with this Section 2.3, and each
delivery of a notice of exercise by a Holder will constitute a representation by
such Holder that it has evaluated the limitation set forth in this paragraph and
determined, based on the most recent public filings by the Company with the
Commission, that the issuance of the full number of shares of Warrant Stock
requested in such notice of exercise is permitted under this paragraph.
3. Transfer, Division and Combination.
3.1. Transfer. This Warrant and the Warrant Stock issuable upon exercise
of this Warrant shall be freely transferable, subject to compliance with this
Section 3.1 and all applicable laws, including, but not limited to the
Securities Act. If, at the time of the surrender of this Warrant in connection
with any transfer of this Warrant or the resale of the Warrant Stock, this
Warrant or the Warrant Stock, as applicable, shall not be registered under the
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Securities Act, the Company may require, as a condition of allowing such
transfer (i) that the Holder or transferee of this Warrant or the Warrant Stock
as the case may be, furnish to the Company a written opinion of counsel that is
reasonably acceptable to the Company to the effect that such transfer may be
made without registration under the Securities Act, (ii) that the Holder or
transferee execute and deliver to the Company an investment representation
letter in form and substance acceptable to the Company and substantially in the
form attached as Exhibit C hereto and (iii) that the transferee be an
"accredited investor" as defined in Rule 501(a) promulgated under the Securities
Act. Transfer of this Warrant and all rights hereunder, in whole or in part, in
accordance with the foregoing provisions, shall be registered on the books of
the Company to be maintained for such purpose, upon surrender of this Warrant at
the principal office of the Company referred to in Section 2.1 or the office or
agency designated by the Company pursuant to Section 10, together with a written
assignment of this Warrant substantially in the form of Exhibit B hereto duly
executed by the Holder or its agent or attorney and funds sufficient to pay any
transfer taxes payable upon the making of such transfer. Upon such surrender
and, if required, such payment, the Company shall execute and deliver a new
Warrant or Warrants in the name of the assignee or assignees and in the
denomination specified in such instrument of assignment, and shall issue to the
assignor a new Warrant evidencing the portion of this Warrant not so assigned,
and this Warrant shall promptly be cancelled. Following a transfer that complies
with the requirements of this Section 3.1, the Warrant may be exercised by a new
Holder for the purchase of shares of Common Stock regardless of whether the
Company issued or registered a new Warrant on the books of the Company.
3.2. Restrictive Legends. Each certificate for Warrant Stock initially
issued upon the exercise of this Warrant, and each certificate for Warrant Stock
issued to any subsequent transferee of any such certificate, unless, in each
case, such Warrant Stock is eligible for resale without registration pursuant to
Rule 144(k) under the Exchange Act, or has been sold pursuant to and in
compliance with Rule 144 or an effective registration statement under the
Securities Act, shall bear the following legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 AS AMENDED, AND MAY NOT BE OFFERED OR SOLD IN THE ABSENCE
OF AN EFFECTIVE REGISTRATION STATEMENT UNDER SAID ACT UNLESS, IN THE OPINION OF
COUNSEL REASONABLY SATISFACTORY TO THE COMPANY, SUCH REGISTRATION IS NOT
REQUIRED."
In addition, the legend set forth above shall be removed and the
Company shall issue a certificate without such legend to the holder of any
Warrant Stock upon which it is stamped, if, unless otherwise required by
applicable state securities laws, such Warrant Stock is eligible for resale
without registration pursuant to Rule 144(k) under the Exchange Act, or has been
sold pursuant to and in compliance with Rule 144 or an effective registration
statement filed under the Securities Act.
3.3. Division and Combination; Expenses; Books. This Warrant may be
divided or combined with other Warrants upon presentation hereof at the
aforesaid office or agency of the Company, together with a written notice
specifying the names and denominations in which new Warrants are to be issued,
signed by the Holder or its agent or attorney. Subject to compliance with
Section 3.1 as to any transfer which may be involved in such division or
combination, the
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Company shall execute and deliver a new Warrant or Warrants in exchange for the
Warrant or Warrants to be divided or combined in accordance with such notice.
The Company shall prepare, issue and deliver at its own expense the new Warrant
or Warrants under this Section 3. The Company agrees to maintain, at its
aforesaid office or agency, books for the registration and the registration of
transfer of the Warrants.
4. Adjustments. The number of shares of Common Stock for which this
Warrant is exercisable, and the price at which such shares may be purchased upon
exercise of this Warrant, shall be subject to adjustment from time to time as
set forth in this Section 4. The Company shall give the Holder notice of any
event described below which requires an adjustment pursuant to this Section 4 in
accordance with Sections 5.1 and 5.2.
4.1. Stock Dividends, Subdivisions and Combinations. If at any time while
this Warrant is outstanding the Company shall:
(i) declare a dividend or make a distribution on its outstanding
shares of Common Stock payable in shares of Common Stock,
(ii) subdivide its outstanding shares of Common Stock into a larger
number of shares of Common Stock, or
(iii) combine its outstanding shares of Common Stock into a smaller
number of shares of Common Stock, then:
(1) the number of shares of Common Stock acquirable upon exercise of this
Warrant immediately after the occurrence of any such event shall be adjusted to
equal the number of shares of Common Stock which a record holder of the same
number of shares of Common Stock that would have been acquirable under this
Warrant immediately prior to the record date for such dividend or distribution
or the effective date of such subdivision or combination would own or be
entitled to receive after such record date or the effective date of such
subdivision or combination, as applicable, and
(2) the Current Warrant Price shall be adjusted to equal:
(A) the Current Warrant Price in effect at the time of the record
date for such dividend or distribution or of the effective date of such
subdivision or combination, multiplied by the number of shares of Common
Stock into which this Warrant is exercisable immediately prior to the
adjustment, divided by
(B) the number of shares of Common Stock into which this Warrant is
exercisable immediately after such adjustment.
Any adjustment made pursuant to clause (i) of this paragraph shall become
effective immediately after the record date for the determination of
stockholders entitled to receive such dividend or distribution, and any
adjustment pursuant to clauses (ii) or (iii) of this paragraph shall become
effective immediately after the effective date of such subdivision or
combination.
4.2. Other Provisions Applicable to Adjustments. The following provisions
shall be
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applicable to the making of adjustments of the number of shares of Common Stock
into which this Warrant is exercisable and the Current Warrant Price provided
for in Section 4:
(a) When Adjustments to Be Made. The adjustments required by Section
4 shall be made whenever and as often as any specified event requiring an
adjustment shall occur, except that any that would otherwise be required may be
postponed (except in the case of a subdivision or combination of shares of the
Common Stock, as provided for in Section 4.1) up to, but not beyond the date of
exercise if such adjustment either by itself or with other adjustments not
previously made adds or subtracts less than 1% of the shares of Common Stock
into which this Warrant is exercisable immediately prior to the making of such
adjustment. Any adjustment representing a change of less than such minimum
amount (except as aforesaid) which is postponed shall be carried forward and
made as soon as such adjustment, together with other adjustments required by
this Section 4 and not previously made, would result in a minimum adjustment or
on the date of exercise. For the purpose of any adjustment, any specified event
shall be deemed to have occurred at the close of business on the date of its
occurrence.
(b) Fractional Interests. In computing adjustments under this
Section 4, fractional interests in Common Stock shall be taken into account to
the nearest 1/100th of a share.
(c) When Adjustment Not Required. If the Company undertakes a
transaction contemplated under this Section 4 and as a result takes a record of
the holders of its Common Stock for the purpose of entitling them to receive a
dividend or distribution or subscription or purchase rights or other benefits
contemplated under this Section 4 and shall, thereafter and before the
distribution to stockholders thereof, legally abandon its plan to pay or deliver
such dividend, distribution, subscription or purchase rights or other benefits
contemplated under this Section 4, then thereafter no adjustment shall be
required by reason of the taking of such record and any such adjustment
previously made in respect thereof shall be rescinded and annulled.
(d) Escrow of Stock. If after any property becomes distributable
pursuant to Section 4 by reason of the taking of any record of the holders of
Common Stock, but prior to the occurrence of the event for which such record is
taken, a holder of this Warrant exercises the Warrant during such time, then
such holder shall continue to be entitled to receive any shares of Common Stock
issuable upon exercise hereunder by reason of such adjustment and such shares or
other property shall be held in escrow for the holder of this Warrant by the
Company to be issued to holder of this Warrant upon and to the extent that the
event actually takes place. Notwithstanding any other provision to the contrary
herein, if the event for which such record was taken fails to occur or is
rescinded, then such escrowed shares shall be canceled by the Company and
escrowed property returned to the Company.
4.3. Reorganization, Reclassification, Merger, Consolidation or
Disposition of Assets.
(a) If there shall occur a Change of Control during the period
beginning on the date hereof and ending on the Expiration Date, and, pursuant to
the terms of such Change of Control, shares of common stock of the successor or
acquiring corporation, or any cash, shares of stock or other securities or
property of any nature whatsoever (including warrants or other subscription or
purchase rights) in addition to or in lieu of common stock of the successor or
acquiring corporation ("Other Property"), are to be received by or distributed
to the holders of
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Common Stock of the Company, then the Holder of this Warrant shall have the
right thereafter to receive, upon the exercise of the Warrant, the number of
shares of common stock of the successor or acquiring corporation or of the
Company, if it is the surviving corporation, and the Other Property receivable
upon or as a result of such Change of Control by a holder of the number of
shares of Common Stock into which this Warrant is exercisable immediately prior
to such event.
(b) In case of any such Change of Control described in Section
4.3(a) above, the resulting, successor or acquiring entity (if not the Company)
and, if an entity different from the successor or acquiring entity, the entity
whose capital stock or assets the holders of the Common Stock are entitled to
receive as a result of such Change of Control, shall assume by written
instrument all of the obligations of this Warrant, subject to such modifications
as may be deemed appropriate (as determined by resolution of the Board of
Directors of the Company) in order to provide for adjustments of shares of the
Common Stock into which this Warrant is exercisable which shall be as nearly
equivalent as practicable to the adjustments provided for in Section 4. For
purposes of Section 4, common stock of the successor or acquiring corporation
shall include stock of such corporation of any class which is not preferred as
to dividends or assets on liquidation over any other class of stock of such
corporation and which is not subject to redemption and shall also include any
evidences of indebtedness, shares of stock or other securities which are
convertible into or exchangeable for any such stock, either immediately or upon
the arrival of a specified date or the happening of a specified event and any
warrants or other rights to subscribe for or purchase any such stock. The
foregoing provisions of this Section 4 shall similarly apply to successive
Change of Control transactions.
4.4. Other Action Affecting Common Stock. In case at any time or from time
to time the Company shall take any action in respect of its Common Stock, other
than the payment of cash dividends payable out of earnings or earned surplus
legally available for the payment of dividends under the laws of the
jurisdiction of incorporation of the Company or any action described in Section
4, then, unless such action will not have a materially adverse effect upon the
rights of the holder of this Warrant, the number of shares of Common Stock or
other stock into which this Warrant is exercisable and/or the purchase price
thereof shall be adjusted in such manner as may be equitable in the
circumstances.
4.5. Certain Limitations. Notwithstanding anything herein to the contrary,
the Company agrees not to enter into any transaction which, by reason of any
adjustment hereunder, would cause the Current Warrant Price to be less than the
par value per share of Common Stock.
4.6. Stock Transfer Taxes. The issue of stock certificates upon exercise
of this Warrant shall be made without charge to the holder for any tax in
respect of such issue. The Company shall not, however, be required to pay any
tax which may be payable in respect of any transfer involved in the issue and
delivery of shares in any name other than that of the holder of this Warrant,
and the Company shall not be required to issue or deliver any such stock
certificate unless and until the person or persons requesting the issue thereof
shall have paid to the Company the amount of such tax or shall have established
to the satisfaction of the Company that such tax has been paid.
5. Notices to Warrant Holders.
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5.1. Certificate as to Adjustments. Upon the occurrence of each adjustment
or readjustment of the Current Warrant Price, the Company, at its expense, shall
promptly compute such adjustment or readjustment in accordance with the terms
hereof and prepare and furnish to the Holder of this Warrant a certificate
setting forth such adjustment or readjustment and showing in detail the facts
upon which such adjustment or readjustment is based. The Company shall, upon the
written request at any time of the Holder of this Warrant, furnish or cause to
be furnished to such Holder a like certificate setting forth (i) such
adjustments and readjustments, (ii) the Current Warrant Price at the time in
effect and (iii) the number of shares of Common Stock and the amount, if any, or
other property which at the time would be received upon the exercise of Warrants
owned by such Holder.
5.2. Notice of Corporate Action. If at any time:
(a) the Company shall take a record of the holders of its Common
Stock for the purpose of entitling them to receive a dividend or other
distribution, or any right to subscribe for or purchase any evidences of its
indebtedness, any shares of stock of any class or any other securities or
property, or to receive any other right, or
(b) there shall be any capital reorganization of the Company, any
reclassification or recapitalization of the capital stock of the Company or any
consolidation or merger of the Company with, or any sale, transfer or other
disposition of all or substantially all the property, assets or business of the
Company to, another corporation, or
(c) there shall be a voluntary or involuntary dissolution,
liquidation or winding up of the Company; or
(d) the Company shall cause the holders of its Common Stock to be
entitled to receive (i) any dividend or other distribution of cash, (ii) any
evidences of its indebtedness, or (iii) any shares of stock of any class or any
other securities or property or assets of any nature whatsoever (other than cash
or additional shares of Common Stock as provided in Section 4.1 hereof); or (iv)
any warrants or other rights to subscribe for or purchase any evidences of its
indebtedness, any shares of stock of any class or any other securities or
property or assets of any nature whatsoever;
then, in any one or more of such cases, the Company shall give to the Holder (i)
at least 15 days' prior written notice of the record date selected for such
dividend, distribution or right or for determining rights to vote in respect of
any such reorganization, reclassification, merger, consolidation, sale,
transfer, disposition, dissolution, liquidation or winding up, and (ii) in the
case of any such reorganization, reclassification, merger, consolidation, sale,
transfer, disposition, dissolution, liquidation or winding up, at least 15 days'
prior written notice of the date when the same shall take place. Such notice in
accordance with the foregoing clause also shall specify (i) the date on which
any such record is to be taken for the purpose of such dividend, distribution or
right, the date on which the holders of Common Stock shall be entitled to any
such dividend, distribution or right, and the amount and character thereof, and
(ii) the date on which any such reorganization, reclassification, merger,
consolidation, sale, transfer, disposition, dissolution, liquidation or winding
up is to take place and the time, if any such time is to be fixed, as of which
the holders of Common Stock shall be entitled to exchange their
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shares of Common Stock for securities or other property deliverable upon such
reorganization, reclassification, merger, consolidation, sale, transfer,
disposition, dissolution, liquidation or winding up. Each such written notice
shall be sufficiently given if addressed to the Holder at the last address of
the Holder appearing on the books of the Company and delivered in accordance
with Section 12.2. The failure to give any notice required by this Section 5.2
shall not invalidate any such corporate action.
5.3. No Rights as Stockholder. This Warrant does not entitle the Holder to
any voting or other rights as a stockholder of the Company prior to exercise and
payment for the Warrant Price in accordance with the terms hereof.
6. No Impairment. The Company shall not by any action, including, without
limitation, amending its certificate of incorporation or through any
reorganization, transfer of assets, consolidation, merger, dissolution, issue or
sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of this Warrant, but will at all
times in good faith assist in the carrying out of all such terms and in the
taking of all such actions as may be necessary or appropriate to protect the
rights of the Holder against impairment. Without limiting the generality of the
foregoing, the Company will (a) not increase the par value of any shares of
Common Stock receivable upon the exercise of this Warrant above the amount
payable therefor upon such exercise immediately prior to such increase in par
value, (b) take all such action as may be necessary or appropriate in order that
the Company may validly and legally issue fully paid and nonassessable shares of
Common Stock upon the exercise of this Warrant, and (c) use its best efforts to
obtain all such authorizations, exemptions or consents from any public
regulatory body having jurisdiction thereof as may be necessary to enable the
Company to perform its obligations under this Warrant. Upon the request of the
Holder, the Company will at any time during the period this Warrant is
outstanding acknowledge in writing, in form satisfactory to the Holder, the
continuing validity of this Warrant and the obligations of the Company
hereunder.
7. Reservation and Authorization of Common Stock; Registration With
Approval of Any Governmental Authority. From and after the Closing Date, the
Company shall at all times reserve and keep available for issue upon the
exercise of Warrants such number of its authorized but unissued shares of Common
Stock as will be sufficient to permit the exercise in full of all outstanding
Warrants (without regard to any ownership limitations provided in Section 2.3).
All shares of Common Stock which shall be so issuable, when issued upon exercise
of any Warrant and payment therefor in accordance with the terms of such
Warrant, shall be duly and validly issued and fully paid and nonassessable, and
not subject to preemptive rights. Before taking any action which would cause an
adjustment reducing the Current Warrant Price below the then par value, if any,
of the shares of Common Stock issuable upon exercise of the Warrants, the
Company shall take any corporate action which may be necessary in order that the
Company may validly and legally issue fully paid and non-assessable shares of
such Common Stock at such adjusted Current Warrant Price. Before taking any
action which would result in an adjustment in the number of shares of Common
Stock for which this Warrant is exercisable or in the Current Warrant Price, the
Company shall obtain all such authorizations or exemptions thereof, or consents
thereto, as may be necessary from any public regulatory body or bodies having
jurisdiction thereof. If any shares of Common Stock required to be reserved for
issuance upon exercise of Warrants require registration or qualification with
any governmental authority
11
under any federal or state law before such shares may be so issued (other than
as a result of a prior or contemplated distribution by the Holder of this
Warrant), the Company will in good faith and as expeditiously as possible and at
its expense endeavor to cause such shares to be duly registered.
8. Taking of Record; Stock and Warrant Transfer Books. In the case of all
dividends or other distributions by the Company to the holders of its Common
Stock with respect to which any provision of Section 4 refers to the taking of a
record of such holders, the Company will in each such case take such a record
and will take such record as of the close of business on a Business Day. The
Company will not at any time, except upon dissolution, liquidation or winding up
of the Company, close its stock transfer books or Warrant transfer books so as
to result in preventing or delaying the exercise or transfer of any Warrant.
9. Loss or Mutilation. Upon receipt by the Company from the Holder of
evidence reasonably satisfactory to it of the ownership of and the loss, theft,
destruction or mutilation of this Warrant and indemnity or security reasonably
satisfactory to it and reimbursement to the Company of all reasonable expenses
incidental thereto and in case of mutilation upon surrender and cancellation
hereof, the Company will execute and deliver in lieu hereof a new Warrant of
like tenor to the Holder; provided, however, that in the case of mutilation, no
indemnity shall be required if this Warrant in identifiable form is surrendered
to the Company for cancellation.
10. Office of the Company. As long as any of the Warrants remain
outstanding, the Company shall maintain an office or agency (which may be the
principal executive offices of the Company) where the Warrants may be presented
for exercise, registration of transfer, division or combination as provided in
this Warrant.
11. Limitation of Liability. No provision hereof, in the absence of
affirmative action by the Holder to purchase shares of Common Stock, and no
enumeration herein of the rights or privileges of the Holder hereof, shall give
rise to any liability of the Holder for the purchase price of any Common Stock,
whether such liability is asserted by the Company or by creditors of the
Company.
12. Miscellaneous.
12.1. Nonwaiver and Expenses. No course of dealing or any delay or failure
to exercise any right hereunder on the part of the Holder shall operate as a
waiver of such right or otherwise prejudice the Holder's rights, powers or
remedies. If the Company fails to make, when due, any payments provided for
hereunder, or fails to comply with any other material provision of this Warrant,
the Company shall pay to the Holder such amounts as shall be sufficient to cover
any third party costs and expenses including, but not limited to, reasonable
attorneys' fees, including those of appellate proceedings, incurred by the
Holder in collecting any amounts due pursuant hereto or in otherwise enforcing
any of its rights, powers or remedies hereunder.
12.2. Notice Generally. Any and all notices or other communications or
deliveries required or permitted to be provided hereunder shall be in writing
and shall be deemed given and effective on the earliest of (a) the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile number specified on the signature pages attached hereto
12
prior to 5:00 p.m. (New York City time) on a Trading Day, (b) the next Trading
Day after the date of transmission, if such notice or communication is delivered
via facsimile at the facsimile number included with the address for the
recipient as provided herein on a day that is not a Trading Day or later than
5:00 p.m. (New York City time) on any Trading Day, (c) the Trading Day following
the date of mailing, if sent by U.S. nationally recognized overnight courier
service, or (d) upon actual receipt by the party to whom such notice is required
to be given. The address for such notices and communications shall be as
follows:
If to the Purchasers, at each Purchaser's address set forth in the books
and records of the Company, or with respect to the Company, addressed to:
Spectrum Pharmaceuticals, Inc.
157 Technology Drive
Irvine, California 92618
Attention: CEO
Facsimile No.: (949) 788-6706
or to such other address or addresses or facsimile number or numbers as any such
party may most recently have designated in writing to the other parties hereto
by such notice. Copies of notices to the Company shall be sent to:
Latham & Watkins LLP
650 Town Center Drive, Suite 2000
Costa Mesa, California 92626
Attention: Alan W. Pettis
Facsimile No.: (714) 755-8290
12.3. Successors and Assigns. Subject to compliance with the provisions of
Section 3.1, this Warrant and the rights evidenced hereby shall inure to the
benefit of and be binding upon the successors of the Company and the successors
and assigns of the Holder. The provisions of this Warrant are intended to be for
the benefit of all Holders from time to time of this Warrant, and shall be
enforceable by any such Holder.
12.4. Amendment. This Warrant may be modified or amended or the provisions
of this Warrant waived with the written consent of both the Company and the
Holder.
12.5. Severability. Wherever possible, each provision of this Warrant
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Warrant shall be prohibited by or
invalid under applicable law, such provision shall be modified to the extent of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Warrant.
12.6. Headings. The headings used in this Warrant are for the convenience
of reference only and shall not, for any purpose, be deemed a part of this
Warrant.
12.7. Governing Law. This Warrant and the transactions contemplated hereby
shall be deemed to be consummated in the State of New York and shall be governed
by and interpreted in
13
accordance with the local laws of the State of New York without regard to the
provisions thereof relating to conflicts of laws. The Company hereby irrevocably
consents to the exclusive jurisdiction of the State and Federal courts located
in New York City, New York in connection with any action or proceeding arising
out of or relating to this Warrant. In any such litigation the Company agrees
that the service thereof may be made by certified or registered mail directed to
the Company pursuant to Section 12.2.
[Signature Page Follows]
14
IN WITNESS WHEREOF, Spectrum Pharmaceuticals, Inc. has caused this Warrant
to be executed by its duly authorized officer and attested by its Secretary.
Dated: September 30, 2004
SPECTRUM PHARMACEUTICALS, INC.
By: /s/ Rajesh C. Shrotriya
---------------------------
Name: Rajesh C. Shrotriya, M.D.
---------------------------
Title: Chairman, CEO and President
---------------------------
Attest:
By: /s/ Shyam Kumaria
---------------------------
Name: Shyam Kumaria
---------------------------
Title: Secretary
---------------------------
15
EXHIBIT A
SUBSCRIPTION FORM
[To be executed only upon exercise of Warrant]
1. The undersigned registered owner of this Warrant hereby elects to
exercise this Warrant to purchase _______ shares of the Common Stock of Spectrum
Pharmaceuticals, Inc. pursuant to the terms of the attached Warrant, and tenders
herewith payment of the purchase price of such shares in full.
2. By signing below, the undersigned hereby certifies that the exercise of
the Warrant for the number of shares of Common Stock indicated above will not
violate the limitation on the number of shares that may be acquired upon
exercise of the Warrant set forth in Section 2.3 of the Warrant.
3. Please issue a certificate or certificates representing said shares of
Common Stock in the name of the undersigned or in such other name as is
specified below:
____________________________________
(Name)
____________________________________
____________________________________
____________________________________
(Address)
[and, if such shares of Common Stock shall not include all of the shares
of Common Stock issuable as provided in this Warrant, that a new Warrant of like
tenor and date for the balance of the shares of Common Stock issuable hereunder
be delivered to the undersigned.]
_____________________________________
(Name of Registered Owner)
_____________________________________
(Signature of Registered Owner)
_____________________________________
(Street Address)
_____________________________________
(State) (Zip Code)
NOTICE: The signature on this subscription must correspond with the name as
written upon the face of the Warrant in every particular, without alteration or
enlargement or any change whatsoever.
16
EXHIBIT B
ASSIGNMENT FORM
FOR VALUE RECEIVED the undersigned registered owner of this Warrant for the
purchase of shares of common stock of Spectrum Pharmaceuticals, Inc. hereby
sells, assigns and transfers unto the Assignee named below all of the rights of
the undersigned under this Warrant, with respect to the number of shares of
common stock set forth below:
_____________________________________
_____________________________________
_____________________________________
(Name and Address of Assignee)
_____________________________________
(Number of Shares of Common Stock)
and does hereby irrevocably constitute and appoint ____________ attorney-in-fact
to register such transfer on the books of the Company, maintained for the
purpose, with full power of substitution in the premises.
Dated:_______________________________
_____________________________________
(Print Name and Title)
_____________________________________
(Signature)
_____________________________________
(Witness)
NOTICE: The signature on this assignment must correspond with the name as
written upon the face of the Warrant in every particular, without alteration or
enlargement or any change whatsoever.
17
EXHIBIT C
FORM OF INVESTMENT REPRESENTATION LETTER
In connection with the acquisition of [warrants (the "Warrants") to purchase
____ shares of common stock of Spectrum Pharmaceuticals, Inc. (the "Company"),
par value $0.001 per share (the "Common Stock")][___shares of common stock of
Spectrum Pharmaceuticals, Inc. (the "Company"), par value $0.001 per share (the
"Common Stock") upon the exercise of warrants by ________], by _______________
(the "Holder") from _____________, the Holder hereby represents and warrants to
the Company as follows:
The Holder (i) is an "Accredited Investor" as that term is defined in Rule 501
of Regulation D promulgated under the Securities Act of 1933, as amended (the
"Act"); (ii) has the ability to bear the economic risks of such Holder's
prospective investment, including a complete loss of Holder's investment in the
Warrants and the shares of Common Stock issuable upon the exercise thereof
(collectively, the "Securities"); and (iii) is acquiring the securities such
Holder's own account for investment and not with a view to, or for sale in
connection with, any distribution thereof, nor with the intention of
distributing or reselling the same, provided, however, that by making the
representation herein, the Holder does not agree to hold any of the Securities
for any minimum or other specific term and reserves the right to dispose of the
Securities at any time in accordance with or pursuant to a registration
statement or an exemption from registration under the Securities Act.
[The Holder acknowledges that (i) the Securities have not been registered under
the Act, (ii) the Securities are "restricted securities" and the certificate(s)
representing the Securities shall bear the following legend, or a similar legend
to the same effect, until (i) in the case of the shares of Common Stock
underlying the Warrants, such shares shall have been registered for resale by
the Holder under the Act and effectively been disposed of in accordance with a
registration statement that has been declared effective; (ii) such Securities
have been sold pursuant to and in accordance with Rule 144 under the Act; or
(iii) such Securities may be sold pursuant to and in accordance with Rule 144(k)
under the Act:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 AS AMENDED, AND MAY NOT BE OFFERED OR SOLD IN THE ABSENCE
OF AN EFFECTIVE REGISTRATION STATEMENT UNDER SAID ACT UNLESS, IN THE OPINION OF
COUNSEL REASONABLY SATISFACTORY TO THE COMPANY, SUCH REGISTRATION IS NOT
REQUIRED."
18
IN WITNESS WHEREOF, the Holder has caused this Investment Representation Letter
to be executed this __ day of __________ 200_.
[Name]
By:______________________________
Name:
Title:
19
Exhibit 4.1
SCHEDULE I
WARRANT NUMBER ENTITY NAME WARRANTS STOCK
-------------- ----------- --------------
SPPI 267 SCO Capital Partners, LLC 63,970
SPPI 272 Jeffrey B. Davis 20,000
SPPI 273 Daniel DiPietro 7,650
SPPI 274 Preston Tsao 6,380
SPPI 275 Mark Alvino 2,000