EXHIBIT 4.5
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR
ANY STATE SECURITIES LAWS. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF A REGISTRATION STATEMENT
IN EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT OR AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED OR UNLESS
SOLD PURSUANT TO RULE 144 OF SUCH ACT. ANY SUCH TRANSFER MAY ALSO BE SUBJECT TO
APPLICABLE STATE SECURITIES LAWS.
BOSTON LIFE SCIENCES, INC.
Warrant for the Purchase of Shares of
--------------------------------------
Common Stock
------------
NO. BLSI - [INSERT NUMBER] [INSERT NUMBER] SHARES
FOR VALUE RECEIVED, BOSTON LIFE SCIENCES, INC., A Delaware corporation (the
"COMPANY"), hereby certifies that United Congregations Mesora or his permitted
assigns, is entitled to purchase from the Company, at any time or from time to
time commencing on [insert date] (the "Initial Exercise Date") and prior to 5:00
P. M., New York City time, on [insert date] (the "Termination Date"), [INSERT
NUMBER] fully paid and non-assessable shares of the Common Stock, $.01 par value
per share, of the Company for an aggregate purchase price of [insert price]
computed on the basis of [insert price] per share. (Hereinafter, (i) said
Common Stock, together with any other equity securities which may be issued by
the Company with respect thereto or in substitution therefor, is referred to as
the "COMMON STOCK", (ii) the shares of the Common Stock purchasable hereunder or
under any other Warrant (as hereinafter defined) are referred to as the "WARRANT
SHARES", (iii) the aggregate purchase price payable for the Warrant Shares
hereunder is referred to as the "AGGREGATE WARRANT PRICE", (iv) the price
payable for each of the Warrant Shares hereunder is referred to as the "PER
SHARE WARRANT PRICE", (v) this Warrant, all similar Warrants issued on the date
hereof and all warrants hereafter issued in exchange or substitution for this
Warrant or such similar Warrants are referred to as the "WARRANTS" and (vi) the
holder of this Warrant is referred to as the "HOLDER" and the holder of this
Warrant and all other Warrants or Warrant Shares issued upon the exercise of any
Warrant are referred to as the "HOLDERS"). The Aggregate Warrant Price is not
subject to adjustment. The Per Share Warrant Price is subject to adjustment as
hereinafter provided; in the event of any such adjustment, the number of Warrant
Shares shall be adjusted by dividing the Aggregate Warrant Price by the Per
Share Warrant Price in effect immediately after such adjustment.
1. EXERCISE OF WARRANT
-------------------
(a) This Warrant may be exercised, in whole at any time or in part
from time to time, commencing on the Initial Exercise Date and prior to 5:00
P.M. New York City time, on the Termination Date by the holder by the surrender
of this Warrant (with the subscription form at the end hereof duly executed) at
the address set forth in Subsection 9(a) hereof, together with proper payment of
the Aggregate Warrant Price, or the proportionate part thereof if this Warrant
is exercised in part, with payment for Warrant Shares made by certified or
official bank check payable to the order of the Company.
(b) If this Warrant is exercised in part, this Warrant must be
exercised for a number of whole shares of the Common Stock and the Holder is
entitled to receive a new Warrant covering the Warrant Shares which have not
been exercised and setting forth the proportionate part of the Aggregate Warrant
Price applicable to such Warrant Shares. Upon surrender of this Warrant, the
Company will (i) issue a certificate or certificates in the name of the Holder
for the largest number of whole shares of the Common Stock to which the Holder
shall be entitled and, if this Warrant is exercised in whole, in lieu of any
fractional share of the Common Stock to which the Holder shall be entitled, pay
to the Holder cash in an amount equal to the fair value of such fractional share
(determined in such reasonable manner as the Board of Directors of the Company
shall determine), and (ii) deliver the other securities and properties
receivable upon the exercise of this Warrant, if any, or the proportionate part
thereof if this Warrant is exercised in part, pursuant to the provisions of this
Warrant.
2. RESERVATION OF WARRANT SHARES; LISTING. The Company agrees that,
--------------------------------------
prior to the expiration of this Warrant, the Company will at all times (a) have
authorized and in reserve, and will keep available, solely for issuance or
delivery upon the exercise of this Warrant, the shares of the Common Stock and
other securities and properties as from time to time shall be receivable upon
the exercise of this Warrant, free and clear of all restrictions on sale or
transfer, except for the restrictions on sale or transfer set forth in the
Securities Act of 1933, as amended (the "ACT"), and restrictions created by or
on behalf of the Holder, and free and clear of all preemptive rights and rights
of first refusal; and (b) if the Company prepares and files a registration
statement covering the shares of Common Stock issued or issuable upon exercise
of this Warrant with the Securities and Exchange Commission (the "SEC") which
registration statement is declared effective by the SEC under the Act and the
Company lists its Common Stock on any national securities exchange, it will use
its best efforts to cause the shares of Common Stock subject to this Warrant to
be listed on such exchange.
3. PROTECTION AGAINST DILUTION.
---------------------------
(a) If, at any time or from time to time after the date of the
Warrant, the Company shall issue or distribute to the holders of shares of
Common Stock evidence of its indebtedness, any other securities of the Company
or any cash property or other assets (excluding a subdivision, combination or
reclassification, or dividend or distribution payable in shares of Common Stock,
referred to in Subsection 3(b), and also excluding cash dividends or cash
distributions paid out of net profits legally available therefor in the full
amount thereof, together with the value of other dividends and distributions
made substantially concurrently therewith or pursuant to a plan which includes
payment thereof, which is equivalent to not more than 5% of the Company's net
worth) (any such non-excluded event being herein called a "SPECIAL DIVIDEND"),
the Per Share Warrant Price shall be adjusted by multiplying the Per Share
Warrant Price then in effect by a fraction, the numerator of which shall be the
then current Market Price of the Common Stock less the fair market value (as
determined in good faith by the Company's Board of Directors) of the evidence of
indebtedness, cash, securities or property, or other assets
2
issued or distributed in such Special Dividend applicable to one share of Common
Stock and the denominator of which shall be the then current Market Price of the
Common Stock. An adjustment made pursuant to this Subsection 3(a) shall become
effective immediately after the record date of any such Special Dividend.
(b) In case the Company shall hereafter (i) pay a dividend or make a
distribution on its capital stock in shares of Common Stock, (ii) subdivide its
outstanding shares of Common Stock into a great number of shares, (iii) combine
its outstanding shares of Common Stock into a smaller number of shares or (iv)
issue by reclassification of its Common Stock any shares of capital stock of
the Company, the Per Share Warrant Price shall be adjusted to be equal to a
fraction, the numerator of which shall be the Aggregate Warrant Price and the
denominator of which shall be the number of shares of Common Stock or other
capital stock of the Company which he would have owned immediately following
such action had such Warrant been exercised immediately prior thereto. An
adjustment made pursuant to this Subsection 3(b) shall become effective
immediately after the record date in the case of a dividend or distribution and
shall become effective immediately after the effective date in the case of a
subdivision, combination or reclassification.
(c) Except as provided in Subsections 3(a) and 3(d), in case the
Company shall hereafter issue or sell any Common Stock, any securities
convertible into Common Stock, or any rights, options or warrants to purchase
Common Stock or any securities convertible into Common Stock, in each case for a
price per share or entitling the holders thereof to purchase Common Stock at a
price per share (determined by dividing (i) the total amount, if any, received
or receivable by the Company in consideration of the issuance or sale of such
securities plus the total consideration, if any, payable to the Company upon
exercise or conversion thereof (the "TOTAL CONSIDERATION") by (ii) the number of
additional shares of Common Stock issuable upon exercise or conversion of such
securities) less than the then current Per Share Warrant Price in effect on the
date of such issuance or sale, the Per Share Warrant Price shall be adjusted as
of the date of such issuance or sale so that the same shall equal the price
determined by dividing (i) the sum of (A) the number of shares of Common Stock
outstanding on the date of such issuance or sale multiplied by the Per Share
Warrant Price plus (B) the Total Consideration by (ii) the number of shares of
Common Stock outstanding on the date of such issuance or sale plus the maximum
number of additional shares of Common Stock issuable upon exercise or conversion
of such securities.
(d) No adjustment in the Per Share Warrant Price shall be required in
the case of the issuance by the Company of (a) Common Stock pursuant to the
exercise of any Warrant, (b) options or warrants to purchase Common Stock
(including the exercise thereof) issued or sold to employees, officers or
directors of or consultants and advisers to the Company or any subsidiary
thereof, and (c) shares of Common Stock issued or sold pursuant to stock
purchase or stock option plans or other similar arrangements that are approved
by the Company's Board of Directors.
(e) In case of any capital reorganization or reclassification, or any
consolidation or merger to which the Company is a party other than a merger or
consolidation in which the Company is the continuing corporation, or in case of
any sale or conveyance to another entity of the property of the Company as an
entirety or substantially as an entirety, or in the case of any statutory
exchange of securities with another corporation (including any exchange effected
in connection with a merger of a third corporation into the Company), the Holder
of this Warrant shall have the right thereafter to receive on the exercise of
this Warrant the kind and amount of securities, cash or other property which the
Holder would have owned or have been entitled to receive immediately after such
reorganization, reclassification, consolidation, merger, statutory
3
exchange, sale or conveyance had this Warrant been exercised immediately prior
to the effective date of such reorganization, reclassification, consolidation,
merger, statutory exchange, sale or conveyance and in any such case, if
necessary, appropriate adjustment shall be made in the application of the
provisions set forth in this Section 3 with respect to the rights and interests
thereafter of the Holder of this Warrant to the end that the provisions set
forth in this Section 3 shall thereafter correspondingly be made applicable, as
nearly as may reasonably be, in relation to any shares or other securities or
property thereafter deliverable on the exercise of this Warrant. The above
provisions of this Subsection 3(e) shall similarly apply to successive
reorganizations, reclassifications, consolidations, mergers, statutory
exchanges, sales or conveyances. The issuer of any shares of stock or other
securities or property thereafter deliverable on the exercise of this Warrant
shall be responsible for all of the agreements and obligations of the Company
hereunder. Notice of any such reorganization, reclassification, consolidation,
merger, statutory exchange, sale or conveyance and of said provisions so
proposed to be made, shall be mailed to the Holders of the Warrants not less
than 30 days prior to such event. A sale of all or substantially all of the
assets of the Company for a consideration consisting primarily of securities
shall be deemed a consolidation or merger for the foregoing purposes.
(f) In case any event shall occur as to which the other provisions of
this Section 3 are not strictly applicable but as to which the failure to make
any adjustment would not fairly protect the purchase rights represented by this
Warrant in accordance with the essential intent and principles hereof then, in
each such case, the Holders of Warrants representing the right to purchase a
majority of the Warrant Shares subject to all outstanding Warrants may appoint a
firm of independent public accountants of recognized national standing
reasonably acceptable to the Company, which shall give their opinion as to the
adjustment, if any, on a basis consistent with the essential intent and
principles established herein, necessary to preserve the purchase rights
represented by the Warrants. Upon receipt of such opinion, the Company will
promptly mail a copy thereof to the Holder of this Warrant and shall make the
adjustments described therein. The fees and expenses of such independent public
accountants shall be borne by the Company.
(g) No adjustment in the Per Share Warranty Price shall be required
unless such adjustment would require an increase or decrease of at least $0.05
per share of Common Stock; provided, however, that any adjustments which by
-------- -------
reason of this Subsection 3(g) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment; provided, further,
-------- -------
however, that adjustments shall be required and made in accordance with the
provisions of this Section 3 (other than this Subsection 3(g)) not later than
such times as may be required in order to preserve the tax-free nature of a
distribution to the Holder of this Warrant or Common Stock issuable upon the
exercise hereof. All calculations under this section 3 shall be made to the
nearest cent or to the nearest 1/100th of share, as the case may be. Anything
in this Section 3 to the contrary notwithstanding, the Company shall be entitled
to make such reductions in the Per Share Warrant Price, in addition to those
required by this Section 3, as it in its discretion shall deem to be advisable
in order that any stock dividend, subdivision of shares or distribution of
rights to purchase stock or securities convertible or exchangeable for stock
hereafter made by the Company to its stockholders shall not be taxable.
4
(h) Whenever the Per Share Warrant Price is adjusted as provided in
this Section 3 and upon any modification of the rights of a Holder of Warrants
in accordance with this Section 3, the Company shall promptly obtain, at its
expense, a certificate of a firm of independent public accountants of recognized
standing selected by the Board of Directors (who may be the regular auditors of
the Company) setting forth the Per Share Warrant Price and the number of Warrant
Shares after such adjustment or the effect of such modification, a brief
statement of the facts requiring such adjustment or modification and the manner
of computing the same and cause copies of such certificate to be mailed to the
Holders of the Warrants.
(i) If the Board of Directors of the Company shall declare any
dividend or other distribution with respect to the Common Stock other than a
cash distribution out of earned surplus, the Company shall mail notice thereof
to the Holders of the Warrants not less than 15 days prior to the record date
fixed for determining stockholders entitled to participate in such dividend or
other distribution.
(j) If, as a result of an adjustment made pursuant to this Section 3,
the Holder of any Warrant thereafter surrendered for exercise shall become
entitled to receive shares of two or more classes of capital stock or shares of
Common Stock and other capital stock of the Company, the Board of Directors
(whose determination shall be conclusive and shall be described in a written
notice to the Holder of any Warrant promptly after such adjustment) shall
determine the allocation of the adjusted Per Share Warrant Price between or
among shares or such classes of capital stock or shares of Common Stock and
other capital stock.
4. FULLY PAID STOCK; TAXES. The Company agrees that the shares of the
-----------------------
Common Stock represented by each and every certificate of Warrant Shares
delivered on the exercise of this Warrant be validly issued and outstanding,
fully paid and nonassessable, and not subject to preemptive rights or rights of
first refusal, and the Company will take all such actions as may be necessary to
assure that the par value or stated value, if any, per share of the Common Stock
is at all times equal to or less than the then Per Share Warrant Price. The
Company further covenants and agrees that it will pay, when due and payable, any
and all Federal and State stamp, original issue or similar taxes which may be
payable in respect of the issue of any Warrant Share or any certificate thereof.
5. REGISTRATION UNDER SECURITIES ACT OF 1933.
-----------------------------------------
(a) The Company agrees that if, at any time during the period
commencing on the date hereof and ending on the Termination Date, the Holder
and/or the Holders of any other Warrants and Warrant Shares which have not
previously been registered under the Act or which are not freely transferable
without registration under the Act due to the lapse of time or otherwise and who
or which shall hold greater than 50% of the Warrant Shares issued or is issuable
upon the exercise of the Warrants, shall request that the Company file a
registration statement under the Act covering not less than 50% of the shares of
the Warrant Shares issued or issuable upon the exercise of the Warrants, the
Company will (i) promptly notify each Holder of the Warrants and each holder of
Warrant Shares that such registration statement will be filed and that the
Warrant Shares which are then held, and/or may be acquired upon exercise of the
Warrants by the Holder and such holders will be included in such registration
statement at the Holder's and such holders' request, (ii) cause such
registration statement to cover all such Warrant Shares which it has been so
requested to include, (iii) use its best efforts to cause such registration
statement to become effective as soon as practicable and (iv) take all other
action necessary under any Federal or state law or regulation of any
governmental authority to permit all such Common Stock which it has been so
requested to include in such registration statement to be sold or otherwise
disposed of, and will use its best efforts to maintain such compliance with
5
each such Federal and state law and regulation of any governmental authority for
the period necessary for such Holders to effect the proposed sale of other
disposition; provided, however, that such period and the period during which the
Company is required to keep the registration statement effective in connection
with this Section 5(a) shall not exceed the earlier of (A) 120 days from the
date of effectiveness of such registration statement under the Act and (B) the
date upon which the Holders have completed the sale or other disposition of the
Warrant Shares. The Company shall be required to effect a registration or
qualification pursuant to this Subsection 5(a) on one occasion only.
(b) The Company agrees that if, at any time and from time to time
during the period commencing on the date hereof and ending on the Termination
Date, the Board of Directors of the Company shall authorize the filing of a
registration statement under the Act (other than the initial public offering of
the Company's Common Stock and otherwise than pursuant to Subsection 5(a)
hereof, or other than a registration statement on Form S-8, S-4 or other form
which does not include substantially the same information as would be required
in a form for the general registration of securities) in connection with the
proposed offer of any of its securities by it or any of its stockholders, the
Company will (i) promptly notify each Holder of the Warrants and each holder of
Warrant Shares that such registration statement will be filed and that the
Warrant Shares which are then held, and/or may be acquired upon exercise of the
Warrants by the Holder and such holders will be included in such registration
statement at the Holder's and such holders' request, (ii) cause such
registration statement to cover all of such Common Stock which it has been so
requested to include, (iii) use its best efforts to cause such registration
statement to become effective as soon as practicable and (iv) take all other
action necessary under any Federal or state law or regulation of any
governmental authority to permit all such Common Stock which it has been so
requested to include in such registration statement to be sold or otherwise
disposed of, and will use its best efforts to maintain such compliance with each
such Federal and state law and regulation of any governmental authority for the
period necessary for the Holder and such Holders to effect the proposed sale or
other disposition; provided, however, that such period and the period during
which the Company is required to keep the registration statement effective in
connection with this Section 5(b) shall not exceed the earlier of (A) 120 days
from the date of effectiveness of such registration statement under the Act and
(B) the date upon which the Holders have completed the sale or other disposition
of the Warrant Shares; provided, further, however that such period shall be
extended for a period of time, not to exceed 120 days, equal to the period the
Holders refrain from selling or disposing of any Warrant Shares in such
registration at the request of the underwriter.
(c) Whenever the Company is required pursuant to the provisions of
this Section 5 to include in a registration statement Warrant Shares, the
Company shall (i) furnish each Holder of any such Warrant Shares and each
underwriter of such Common Stock with such copies of the prospectus, including
the preliminary prospectus, conforming to the Act (and such other documents as
each such Holder or each such underwriter may reasonably request) in order to
facilitate the sale or distribution of such Common Stock, (ii) use its best
efforts to register or qualify such Common Stock under the blue sky laws (to the
extent applicable) of such jurisdiction or laws (to the extent applicable) of
such jurisdiction or jurisdictions as the Holders of any Common Stock and each
underwriter of such Common Stock being sold by such Holders shall reasonably
request and (iii) take such other actions as may be reasonably necessary or
advisable to enable such Holders and such underwriters to consummate the sale or
distribution in such jurisdiction or jurisdictions in which such Holders shall
have reasonably requested that such Common Stock be sold; provided, however that
the foregoing "piggyback" registration right shall be subject to the cutback in
the sole discretion of the underwriter for the Company.
6
(d) The Company shall pay all expenses incurred in connection with any
registration statement or other action pursuant to the provision of this Section
5, other than underwriting discounts and applicable transfer taxes relating to
the Warrant Shares.
(e) The Company will indemnify the holders of Warrant Shares which are
included in each registration statement referred to in Subsection 5(a) and 5(b),
and the underwriters of such Common Stock, substantially to the same extent as
is customary for indemnification and contribution provisions in favor or
underwriters and selling shareholders of similar offerings, and such Holders
will indemnify the Company (and the underwriters, if applicable) with respect to
information furnished by them in writing to the Company for inclusion therein
substantially to the same extent as the underwriters indemnify the Company.
(f) If the Company shall at any time have completed a public offering
of shares of its Common Stock, it shall thereafter take such steps as may be
necessary to register it's Common Stock, as the case may be, under Section 12 of
the Securities Exchange Act of 1934, as amended, use its best efforts to
maintain such status, and to file with the Securities and Exchange Commission
all current reports and the information as may be necessary to enable the Holder
to effect sales of its shares in reliance upon Rule 144 promulgated under the
Act.
6. LIMITED TRANSFERABILITY. This Warrant may not be sold, transferred,
------------------------
assigned or hypothecated by the Holder (a) except in compliance with the
provisions of the Act and the applicable state securities "blue sky" laws, and
(b) until the first anniversary hereof except (i) to any successor firm or
corporation of Paramount Capital, Inc., (ii) to any of the officers or employees
of Paramount Capital, Inc., or any such successor firm or (iii) in the case of
an individual, pursuant to such individual's last will and testament or the laws
of descent and distribution, and is so transferable only upon the books of the
Company which it shall cause to me maintained for such purpose. The Company may
treat the registered Holder of this Warrant as he or it appears on the Company's
books at any time as the Holder for all purposes. The Company shall permit any
Holder of a Warrant or his duly authorized attorney, upon written request
during ordinary business hours, to inspect and copy or make extracts from its
books showing the registered holders of Warrants. All warrants issued upon the
transfer or assignment of this Warrant will be dated the same date as this
Warrant, and all rights of the holder thereof shall be identical to those of the
Holder.
7. LOSS, ETC., OF WARRANT. Upon receipt of evidence satisfactory to the
----------------------
Company of the loss, theft, destruction or mutilation of this Warrant, and of
indemnity reasonably satisfactory to the Company, if lost, stolen or destroyed,
and upon surrender and cancellation of this Warrant, if mutilated, the Company
shall execute and deliver to the Holder a new Warrant of like date, tenor and
denomination.
8. WARRANT HOLDER NOT SHAREHOLDER. Except as otherwise provided herein,
------------------------------
this Warrant does not confer upon the Holder any right to vote or to consent to
or receive notice as a stockholder of the Company, as such, in respect of any
matters whatsoever, or any other rights or liabilities as a stockholder, prior
to the exercise hereof.
7
9. COMMUNICATION. No notice or other communication under this Warrant
-------------
shall be effective unless, but any notice or other communication shall be
effective and shall be deemed to have been given if, the same is in writing and
is mailed by first-class mail, postage prepaid, addressed to:
(a) The Company at 31 Newbury Street, Suite 300, Boston,
Massachusetts 02116 or other address as the Company has designated in writing to
the Holder, or
(b) the Holder at [insert address] or other such address as the Holder
has designated in writing to the Company.
10. HEADINGS. The headings of this Warrant have been inserted as a matter
--------
of convenience and shall not affect the construction hereof.
11. APPLICABLE LAW. This Warrant shall be governed by and construed in
--------------
accordance with the law of the State of Delaware without giving effect to the
principles of conflicts of law thereof.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its
President and attested to by its Chief Financial Officer this [insert date].
BOSTON LIFE SCIENCES, INC.
By:_______________________
Chief Executive Officer
ATTEST:
_______________________
Chief Financial Officer
8
SUBSCRIPTION
------------
The undersigned, _______________________, pursuant to the provisions
of the foregoing Warrant, hereby agrees to Subscribe for and purchase
________________ shares of the Common Stock, par value $.01 per share, of Boston
Life Sciences, Inc. covered by said Warrant, and makes payment therefor in full
at the price per share provided by said Warrant.
Dated:__________________ Signature:______________________________
Address:________________________________
________________________________
ASSIGNMENT
----------
FOR VALUE RECEIVED______________ hereby sells, assigns and transfers
unto ______________________the foregoing Warrant and all right evidenced
thereby, and does irrevocably constitute and appoint ________________________,
attorney, to transfer said Warrant on the books of Boston Life Sciences, Inc.
Dated:__________________ Signature:______________________________
Address:________________________________
________________________________
PARTIAL ASSIGNMENT
------------------
FOR VALUE RECEIVED __________________ hereby assigns and transfers
unto ________________________ the right to purchase ___________ shares of the
Common Stock, par value $.01 per share, of Boston Life Sciences, Inc. covered by
the foregoing Warrant, and a proportionate part of said Warrant and the rights
evidenced thereby, and does irrevocably constitute and appoint
____________________________, attorney, to transfer that part of said Warrant on
the books of Boston Life Sciences, Inc.
Dated:__________________ Signature:______________________________
Address:________________________________
________________________________
9