EXHIBIT 4.33
WARRANT
TO SUBSCRIBE FOR AND PURCHASE COMMON STOCK OF
GALAGEN INC.
THIS WARRANT CERTIFIES THAT, for value received, William Young and
Rebecca Young (,herein called "Purchaser") or registered assigns is entitled
to subscribe for and purchase from GalaGen Inc. (herein called the
"Company"), a corporation organized and existing under the laws of the State
of Delaware, at the price specified below (subject to adjustment as noted
below) at any time from and after August 13, 1998 to and including August 13,
2003, Fifty Thousand (50,000) fully paid and nonassessable shares of the
Company's Common Stock, $.01 par value per share ("Common Stock") (subject to
adjustment as noted below). This Warrant granted to the Purchaser is in lieu
of any granted warrants to Investor Network Company or Young, Smith and
Associates.
The warrant purchase price shall be $3.125 per share (subject to
adjustment as noted below).
This Warrant is subject to the following provisions, terms and
conditions:
1. The rights represented by this Warrant may be exercised by
the holder hereof, in whole or in part, by written notice of exercise, in the
form attached hereto, delivered to the Company ten days prior to the intended
date of exercise and by the surrender of this Warrant (properly endorsed if
required) at the principal office of the Company and upon payment to it by
check of the purchase price in lawful money of the United States. The
Company agrees that the shares so purchased shall be and are deemed to be
issued to the holder hereof as the record owner of such shares as of the
close of business on the date on which this Warrant shall have been
surrendered and payment made for such shares as aforesaid. Subject to the
provisions of the next succeeding paragraph, certificates for the shares of
stock so purchased shall be delivered to the holder hereof within a
reasonable time, not exceeding 10 days, after the rights represented by this
Warrant shall have been so exercised, and, unless this Warrant has expired, a
new Warrant representing the number of shares, if any, with respect to which
this Warrant shall not then have been exercised shall also be delivered to
the holder hereof within such time.
2. Notwithstanding the foregoing, however, the Company shall
not be required to deliver any certificate for shares of stock upon exercise
of this Warrant except in accordance with the provisions, and subject to the
limitations, of paragraph 7 hereof and the restrictive legend under the
heading "Restriction on Transfer" below.
3. The Company covenants and agrees that all shares which may
be issued upon the exercise of the rights represented by this Warrant will,
upon issuance, be duly authorized and issued, fully paid and nonassessable.
The Company further covenants and
agrees that during the period within which the rights represented by this
Warrant may be exercised, the Company will at all times have authorized, and
reserved for the purpose of issue or transfer upon exercise of the
subscription rights evidenced by this Warrant, a sufficient number of shares
of its Common Stock to provide for the exercise of the rights represented by
this Warrant.
4. The above provisions are, however, subject to the following:
(a) The warrant purchase price shall, from and after the date of
issuance of this Warrant, be subject to adjustment from time to time as
hereinafter provided. Upon each adjustment of the warrant purchase price,
the holder of this Warrant shall thereafter be entitled to purchase, at the
warrant purchase price resulting from such adjustment, the number of shares
obtained by multiplying the warrant purchase price in effect immediately
prior to such adjustment by the number of shares purchasable pursuant hereto
immediately prior to such adjustment and dividing the product thereof by the
warrant purchase price resulting from such adjustment.
(b) In case the Company shall (i) declare a dividend upon the
Common Stock payable in Common Stock (other than a dividend declared to
effect a subdivision of the outstanding shares of Common Stock, as described
in paragraph (c) below) or any obligations or any shares of stock of the
Company which are convertible into or exchangeable for Common Stock (any of
such obligations or shares of stock being hereinafter called "Convertible
Securities"), or in any rights or options to purchase Common Stock or
Convertible Securities, or (ii) declare any other dividend or make any other
distribution upon the Common Stock payable otherwise than out of earnings or
earned surplus, then thereafter the holder of this Warrant upon the exercise
hereof will be entitled to receive the number of shares of Common Stock to
which such holder shall be entitled upon such exercise, and, in addition and
without further payment therefor, each dividend described in clause (i) above
and each dividend or distribution described in clause (ii) above which such
holder would have received by way of dividends or distributions if
continuously since such holder became the record holder of this Warrant such
holder (x) had been the record holder of the number of shares of Common Stock
then received, and (y) had retained all dividends or distributions in stock
or securities (including Common Stock or Convertible Securities, and any
rights or options to purchase any Common Stock or Convertible Securities)
payable in respect of such Common Stock or in respect of any stock or
securities paid as dividends or distributions and originating directly or
indirectly from such Common Stock. For the purposes of the foregoing, a
dividend or distribution other than in cash shall be considered payable out
of earnings or earned surplus only to the extent that such earnings or earned
surplus are charged an amount equal to the fair value of such dividend or
distribution as determined by the Board of Directors of the Company.
(c) In case the Company shall at any time subdivide its
outstanding shares of Common Stock into a greater number of shares, the
warrant purchase price in effect immediately prior to such subdivision shall
be proportionately reduced, and conversely, in case the outstanding shares of
Common Stock of the Company shall be combined into a smaller
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number of shares, the warrant purchase price in effect immediately prior to
such combination shall be proportionately increased.
(d) If any capital reorganization or reclassification of the
capital stock of the Company, or consolidation or merger of the Company with
another corporation, or sale of all or substantially all of its assets to
another corporation (any such reorganization, reclassification,
consolidation, merger or sale being hereinafter called an "Event") shall be
effected in such a way that holders of Common Stock shall be entitled to
receive stock, securities or assets with respect to or in exchange for Common
Stock, then, unless lawful and adequate provision shall have been made
whereby the holder hereof shall thereafter have the right to purchase and
receive, upon the basis and upon the terms and conditions specified in this
Warrant and in lieu of the shares of the Common Stock of the Company
immediately theretofore purchasable and receivable upon the exercise of the
rights represented hereby, such shares of stock, securities or assets as may
be issued or payable with respect to or in exchange for a number of
outstanding shares of Common Stock of the Company equal to the number of
shares of such stock immediately theretofore purchasable and receivable upon
the exercise of the rights represented hereby had the Event not taken place,
the Board of Directors of the Company shall declare, at least twenty days
prior to the actual effective date of the Event, and provide written notice
to the holder hereof of the declaration, that this Warrant shall be canceled
at the time of, or immediately prior to the occurrence of, the Event (unless
it shall have been exercised prior to the occurrence of the Event) in
exchange for payment to the holder hereof, within twenty days after the
Event, of cash equal to the amount (if any), for each share of Common Stock
issuable upon exercise of this Warrant, by which the Event Proceeds per share
of Common Stock (as hereinafter defined) exceeds the purchase price per share
of Common Stock under this Warrant. In the event of a declaration pursuant
to this paragraph (d), this Warrant, if not exercised prior to the Event,
shall be canceled at the time of, or immediately prior to, the Event, as
provided in the declaration, subject to the payment obligations of the
Company provided in this paragraph (d). For purposes of this paragraph (d),
"Event Proceeds per share of Common Stock" shall mean the cash plus the fair
market value, as determined in good faith by the Board of Directors of the
Company, of the non-cash consideration to be received per share of Common
Stock by the shareholders of the Company upon the occurrence of the Event. If
provision shall be made, pursuant to this paragraph (d), for the right of the
holder hereof to purchase and receive stock, securities or assets of any
successor corporation (other than the Company) upon the occurrence of any
Event, then such successor corporation shall assume, by written instrument
executed and mailed to the registered holder hereof at the last address of
such holder appearing on the books of the Company, the obligation to deliver
to such holder such shares of stock, securities or assets as, in accordance
with the foregoing provisions, such holder may be entitled to purchase.
(e) Upon any adjustment of the warrant purchase price, then and
in each such case the Company shall give written notice thereof, by
first-class mail, postage prepaid, addressed to the registered holder of this
Warrant at the address of such holder as shown on the books of the Company,
which notice shall state the warrant purchase price resulting from such
adjustment and the increase or decrease, if any, in the number of shares
purchasable at such
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price upon the exercise of this Warrant, setting forth in reasonable detail
the method of calculation and the facts upon which such calculation is based.
(f) In case any time:
(1) the Company shall declare any cash dividend on Common
Stock at a rate in excess of the rate of the last cash dividend
theretofore paid;
(2) the Company shall pay any dividend payable in stock upon
Common Stock or make any distribution (other than regular cash
dividends) to the holders of Common Stock;
(3) the Company shall offer for subscription pro rata to the
holders of Common Stock any additional shares of stock of any class or
other rights;
(4) there shall be any capital reorganization, or
reclassification of the capital stock of the Company, or consolidation
or merger of the Company with, or sale of all or substantially all of
its assets to, another corporation; or
(5) there shall be a voluntary or involuntary dissolution,
liquidation or winding up of the Company;
then, in any one or more of said cases, the Company shall give written
notice, by first-class mail, postage prepaid, addressed to the registered
holder of this Warrant at the address of such holder as shown on the books of
the Company, of the date on which (aa) the books of the Company shall close
or a record shall be taken for such dividend, distribution or subscription
rights, or (bb) such reorganization, reclassification, consolidation, merger,
sale, dissolution, liquidation or winding up shall take place, as the case
may be. Such notice shall also specify the date as of which the holders of
Common Stock of record shall participate in such dividend, distribution or
subscription rights, or shall be entitled to exchange their Common Stock for
securities or other property deliverable upon such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation or
winding up, as the case may be. Such written notice shall be given at least
20 days prior to the action in question and not less than 20 days prior to
the record date or the date on which the Company's transfer books are closed
in respect thereto.
(g) If any event occurs as to which in the opinion of the Board
of Directors of the Company the other provisions of this paragraph 4 are not
strictly applicable or if strictly applicable would not fairly protect the
purchase rights of the holder of this Warrant or of Common Stock in
accordance with the essential intent and principles of such provisions, then
the Board of Directors shall make an adjustment in the application of such
provisions, in accordance with such essential intent and principles, so as to
protect such purchase rights as aforesaid; provided, however, that the
members of the Board of Directors of the Company shall not be liable to the
holders hereof for any such determination made in good faith.
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(h) No fractional shares of Common Stock shall be issued upon
the exercise of this Warrant, but, instead of any fraction of a share which
would otherwise be issuable, the Company shall pay a cash adjustment (which
may be effected as a reduction of the amount to be paid by the holder hereof
upon such exercise) in respect of such fraction in an amount equal to the
same fraction of the market price per share of Common Stock as of the close
of business on the date preceding the written notice of exercise required by
paragraph 1 above. "Market price" for purposes of this paragraph 4(h) shall
mean, if the Common Stock is traded on a securities exchange or on The Nasdaq
National Market, the closing price of the Common Stock on such exchange or
The Nasdaq National Market, or, if the Common Stock is otherwise traded in
the over-the-counter market, the closing bid price, in each case averaged
over a period of 20 consecutive business days prior to the date as of which
"market price" is being determined. If at any time the Common Stock is not
traded on an exchange or The Nasdaq National Market, or otherwise traded in
the over-the-counter market, the "market price" shall be deemed to be the
higher of (i) the book value thereof as determined by any firm of independent
public accountants of recognized standing selected by the Board of Directors
of the Company as of the last day of any month ending within 60 days
preceding the date as of which the determination is to be made, or (ii) the
fair value thereof determined in good faith by the Board of Directors of the
Company as of a date which is within l5 days of the date as of which the
determination is to be made.
5. As used herein, the term "Common Stock" shall mean and
include the Company's presently authorized Common Stock and shall also
include any capital stock of any class of the Company hereafter authorized
which shall not be limited to a fixed sum or percentage in respect of the
rights of the holders thereof to participate in dividends or in the
distribution of assets upon the voluntary or involuntary liquidation,
dissolution or winding up of the Company; provided that the shares
purchasable pursuant to this Warrant shall include shares designated as
Common Stock of the Company on the date of original issue of this Warrant or,
in the case of any reclassification of the outstanding shares thereof, the
stock, securities or assets provided for in paragraph 4(d) above.
6. This Warrant shall not entitle the holder hereof to any
voting rights or other rights as a stockholder of the Company.
7.(a) The holder of this Warrant acknowledges that neither this
Warrant nor any of the shares of Common Stock issuable upon exercise hereof
have been registered under the Securities Act of 1933, as amended (the
"Act"), or any state securities laws and that this Warrant or such shares of
Common Stock may only be transferred in accordance with this paragraph 7.
The holder of this Warrant, by acceptance hereof, represents that it has
acquired this Warrant for investment and not with a view to distribution of
this Warrant or the shares of Common Stock issuable upon exercise hereof
within the meaning of the Act and the rules and regulations thereunder.
(b) The Purchaser realizes that the purchase of this Warrant is
a speculative investment, and that the economic benefits which may be derived
therefrom are uncertain. In determining whether or not to purchase the
Warrant, the Purchaser has relied solely upon the
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publicly-available materials filed by the Company with the Securities and
Exchange Commission, copies of which have been reviewed by the Purchaser, and
upon independent investigations made by the Purchaser and its representatives.
(c) The holder of this Warrant, by acceptance hereof, agrees to
give written notice to the Company before exercising or transferring this
Warrant, in whole or in part, or transferring any shares of Common Stock
issuable or issued upon the exercise hereof, of such holder's intention to do
so, describing briefly the manner of any proposed exercise or transfer. Such
holder shall also provide the Company with an opinion of counsel satisfactory
to the Company to the effect that the proposed exercise or transfer of this
Warrant or transfer of shares may be effected without registration or
qualification under the Act and any applicable state securities laws of this
Warrant and the shares of Common Stock issuable or issued upon the exercise
hereof. Upon receipt of such written notice and opinion by the Company, such
holder shall be entitled to exercise this Warrant in accordance with its
terms, or to transfer this Warrant, or to transfer shares of Common Stock
issuable or issued upon the exercise of this Warrant, all in accordance with
the terms of the notice delivered by such holder to the Company, provided
that an appropriate legend respecting the aforesaid restrictions on transfer
may be endorsed on this Warrant or the certificates for such shares. In the
event of a proposed transfer of this Warrant, prior to the transfer the
proposed transferee shall execute and deliver to the Company a warrant
transfer letter in the form attached hereto.
8. Subject to the provisions of paragraph 7 hereof, this
Warrant and all rights hereunder are transferable, in whole or in part, at
the principal office of the Company by the holder hereof in person or by duly
authorized attorney, upon surrender of this Warrant properly endorsed. Each
taker and holder of this Warrant, by taking or holding the same, consents and
agrees that the bearer of this Warrant, when endorsed, may be treated by the
Company and all other persons dealing with this Warrant as the absolute owner
hereof for any purpose and as the person entitled to exercise the rights
represented by this Warrant, or to the transfer hereof on the books of the
Company, any notice to the contrary notwithstanding; but until such transfer
on such books, the Company may treat the registered holder hereof as the
owner for all purposes.
9. The Purchaser shall receive registration rights as follows:
(a) If the Company at any time within five years from the date
of this Warrant (but no more than two (2) years after the date of exercise of
this Warrant), proposes to register under the Securities Act (except by a
Form S-4 or Form S-8 Registration Statement or any successor forms thereto)
any of its securities, it will give written notice to Purchaser hereof, and
on the written request from such Purchaser given within Ten (10) days after
receipt of any such notice (which request shall specify the interest in this
Warrant or the Common Stock from the Warrant to be intended to be sold or
disposed of by such Purchaser (the "Warrant Shares") and describe the nature
of any proposed sale or other disposition thereof), the Company will use its
best efforts to cause all such Warrant Shares, the Purchaser of which shall
have
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requested the registration or qualification thereof, to be included in such
registration statement proposed to be filed by the Company; provided that:
(i) all Warrant Shares subject to this Warrant must be registered
(no registration of a portion of the Warrant Shares is permitted),
provided, however, if a greater number of Warrant Shares is offered for
participation in the proposed offering than in the reasonable opinion of
the managing underwriter of the proposed offering can be accommodated
without adversely affecting the proposed offering, then the amount of
Warrant Shares proposed to be offered by such Purchaser for registration,
as well as the number of securities of any other selling shareholders
participating in the registration, shall be proportionately reduced to a
number deemed satisfactory by the managing underwriter
(ii) the Company may, at its sole discretion and without the
consent of the Purchaser of the Warrant Shares, withdraw such registration
statement and abandon the proposed offering in which any such holder had
requested to participate;
(iii) if the offering to which the registration statement relates is
to be distributed by or through an underwriter, the Purchaser of the
Warrant Shares shall agree, as a condition to the inclusion of such
Purchaser's securities in such registration, to sell securities held by
such Purchaser through such underwriter on the same terms and conditions as
the underwriter agrees to sell securities on behalf of the Company and not
to sell, transfer, pledge, assign or otherwise dispose of the Warrant
Shares of the Company not sold by such holder in such offering for such
period (up to 180 days after the effective date of the registration
statement) as may be required by the underwriter;
(iv) the Company shall not be obligated to include any Warrant
Shares in any such registration if the Purchaser is able to sell all of the
Warrant Shares in a single transaction pursuant to Rule 144 under the
Securities Act (or any other similar rule or regulation) during the
three-month period beginning on the date such notice is received by such
holder, calculated as of the date of such receipt.
(b) Upon the exercise of registration rights pursuant to this
Section 9, Purchaser agrees to supply the Company with such information as
may be required by the Company to register or qualify the shares to be
registered.
(c) With respect to each inclusion of securities in a
registration statement pursuant to this Section 9, the Company shall bear the
following fees, costs, and expenses: all registration, filing and NASD fees,
printing expenses, fees and disbursements of counsel and accountants for the
Company, fees and disbursements of counsel for the underwriter or
underwriters of such securities (if the Company is required to bear such fees
and disbursements), all internal expenses, and legal fees and disbursements
and other expenses of complying with state securities laws of any
jurisdictions in which the securities to be offered are to be registered or
qualified. Fees and disbursements of special counsel and accountants for
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the selling Purchaser, underwriting discounts and commissions, and transfer
taxes for selling Purchaser and any other expenses relating to the sale of
securities by the selling Purchaser not expressly included above shall be
borne by the selling Purchaser.
(d) The Company hereby indemnifies the Purchaser of this Warrant
and of any Warrant Shares within the meaning of Section 15 of the Securities
Act, against all losses, claims, damages, and liabilities caused by (i) any
untrue statement or alleged untrue statement of a material fact contained in
any Registration Statement or Prospectus (and as amended or supplemented if
the Company shall have furnished any amendments thereof or supplements
thereto), any Preliminary Prospectus or any state securities law filings;
(ii) any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading except insofar as such losses, claims, damages, or liabilities are
caused by any untrue statement or omission contained in information furnished
in writing to the Company by such Purchaser expressly for use therein; and
each such Purchaser by its acceptance hereof severally agrees that it will
indemnify and hold harmless the Company, each of its officers who signs such
Registration Statement, each underwriter of the Common Stock so registered,
and each person, if any, who controls the Company or such underwriter, within
the meaning of Section 15 of the Securities Act, with respect to losses,
claims, damages, or liabilities which are caused by any untrue statement or
omission contained in information furnished in writing to the Company by such
Purchaser expressly for use therein.
10. This Warrant is exchangeable, upon the surrender hereof by
the holder hereof at the principal office of the Company, for new Warrants of
like tenor representing in the aggregate the right to subscribe for and
purchase the number of shares which may be subscribed for and purchased
hereunder, each of such new Warrants to represent the right to subscribe for
and purchase such number of shares as shall be designated by said holder
hereof at the time of such surrender.
11. All questions concerning this Warrant will be governed and
interpreted and enforced in accordance with the internal law of the State of
Minnesota.
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IN WITNESS WHEREOF, the Company has caused this Warrant to be
signed by its duly authorized officer and this Warrant to be dated as of
March 9, 1999.
GALAGEN INC.
By
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Its
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RESTRICTION ON TRANSFER
The securities evidenced hereby may not be transferred without (i)
the opinion of counsel satisfactory to the Company that such transfer may be
lawfully made without registration under the Securities Act of 1933, as
amended, and all applicable state securities laws or (ii) such registration.
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ASSIGNMENT
(To Be Signed Only Upon Assignment)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto ___________________________________________________________ this
Warrant, and appoints ____________________________________________________ to
transfer this Warrant on the books of GalaGen Inc. with the full power of
substitution in the premises.
Dated:
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In the presence of:
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(Signature must conform in all
respects to the name of the holder
as specified on the face of this
Warrant without any alteration or
change whatsoever, and the
signature must be guaranteed in the
usual manner)
FORM OF WARRANT TRANSFER LETTER
To: GalaGen Inc.
Ladies and Gentlemen:
The undersigned is a proposed transferee of the warrant (the "Warrant")
to purchase ____________________ shares of Common Stock, par value $.01
("Common Stock"), of GalaGen Inc., a Delaware corporation (the "Company"),
currently registered in the name of ____________________. In order to induce
the Company to consent to the transfer of the Warrant, the undersigned hereby
represents, warrants and agrees as follows:
1. The undersigned acknowledges that neither the Warrant nor any of
the shares of Common Stock issuable upon exercise thereof have been
registered under the Securities Act of 1933, as amended (the "Act"), or any
state securities laws and that, accordingly, the Warrant and such shares of
Common Stock may only be transferred in accordance with the terms of
paragraph 7 of the Warrant.
2. The undersigned is acquiring the Warrant for investment and not
with a view to distribution of the Warrant or the shares of Common Stock
issuable upon exercise thereof within the meaning of the Act and the rules
and regulations thereunder.
3. The undersigned is an "accredited investor" as defined in Rule
501(a) of Regulation D promulgated under the Act.
Signature
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Address
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Date
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FORM OF EXERCISE NOTICE
To be Executed by the Holder of this Warrant if such Holder
Desires to Exercise this Warrant in Whole or in Part:
To: GalaGen Inc. (the "Company")
The undersigned
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Please insert Social Security or other
identifying number of Purchaser:
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hereby irrevocably elects to exercise the right of purchase represented by
this Warrant for, and to purchase thereunder, ______________________ shares
of the Common Stock provided for therein and tenders payment herewith to the
order of the Company in the amount of $______________________, such payment
being made as provided on the face of this Warrant.
In order to induce the Company to consent to the exercise of this
Warrant, the undersigned hereby represents, warrants and agrees as follows:
1. The undersigned acknowledges that neither this Warrant nor any of
the shares of Common Stock issuable upon exercise hereof have been registered
under the Securities Act of 1933, as amended (the "Act"), or any state
securities laws and that, accordingly, this Warrant may be exercised and the
shares of Common Stock issued pursuant to this exercise may only be
transferred in accordance with the terms of paragraph 7 of this Warrant.
2. The undersigned is acquiring the shares of Common Stock issued
pursuant to this exercise for investment and not with a view to distribution
of such shares within the meaning of the Act and the rules and regulations
thereunder.
The undersigned requests that certificates for such shares of
Common Stock be issued as follows:
Name:
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Address:
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Deliver to:
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Address:
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and, if such number of shares of Common Stock shall not be all the shares of
Common Stock purchasable hereunder, that a new Warrant for the balance
remaining of the shares of Common Stock purchasable under this Warrant be
registered in the name of, and delivered to, the undersigned at the address
stated below.
Address:
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Signature
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(Signature must conform in all respects
to the name of the holder as written
specified on the face of this Warrant
without any alteration or change
whatsoever)
Dated:
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