1
EXHIBIT 10.17
No. PW-
____ Shares
THE TRANSFER OF THIS WARRANT IS SUBJECT TO
RESTRICTIONS CONTAINED HEREIN. THIS WARRANT
HAS BEEN ISSUED IN RELIANCE UPON THE
REPRESENTATION OF THE HOLDER THAT IT HAS BEEN
ACQUIRED FOR INVESTMENT PURPOSES AND NOT WITH
A VIEW TOWARDS THE RESALE OR OTHER DISTRIBUTION
THEREOF. NEITHER THIS WARRANT NOR THE SHARES
ISSUABLE UPON THE EXERCISE OF THIS WARRANT HAVE BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY
STATE SECURITIES LAWS.
NANOGEN, INC.
Series B Preferred Stock Purchase Warrant
To Subscribe for and Purchase _______ April 11, 1995
Shares of Series B Preferred Stock
of Nanogen, Inc.
VOID AFTER 5:00 P.M.
PACIFIC TIME
April 11, 2000
THIS CERTIFIES that, for value received, _______________ or its registered
assigns (the "Holders"), is entitled to subscribe for and purchase from NANOGEN,
INC., a California corporation (hereinafter called the "Company"), at the price
of $1.50 per share (such price as from time to time to be adjusted as
hereinafter provided being hereinafter called the "Warrant Price"), at any time
from the date hereof but at or prior to 5:00 p.m. Pacific time on April 11,
2000, up to _____ shares of fully paid and non-assessable Series B Preferred
Stock of the Company (the "Series B Preferred Stock"), subject, however, to the
provisions and upon the terms and conditions hereinafter set forth. This warrant
and any warrant subsequently issued upon exchange or transfer hereof are
hereinafter collectively called the "Warrant". This warrant is one of a series
of warrants to purchase Series B Preferred Stock of even date herewith, each
containing substantially identical terms and conditions, which warrants shall
together be referred to as the "Series B Warrants."
Section 1. Exercise of Warrant. The rights represented by this Warrant may
be exercised by the Holder, in whole or in part (but not as to fractional
shares) at any time or
-1-
2
from time to time in part, but not as to a fractional share of Series B
Preferred Stock by the completion of the purchase form attached hereto and by
the surrender of this Warrant (properly endorsed) at the office of the Company
as it may designate by notice in writing to the Holder hereof at the address of
the Holder appearing on the books of the Company, and by payment to the Company
of the Warrant Price in cash or by certified or official bank check for each
share being purchased. In the event of any exercise of the rights represented by
this Warrant, a certificate or certificates for the shares of Series B Preferred
Stock so purchased, registered in the name of the Holder, or its nominee or
other party designated in the purchase form by the Holder hereof, shall be
delivered to the Holder within thirty business days after the date in which the
rights represented by this Warrant shall have been so exercised; and, unless
this Warrant has expired or has been exercised in full, a new Warrant
representing the number of shares (except a remaining fractional share), if any,
with respect to which this Warrant shall not then have been exercised shall also
be issued to the Holder within such time. The person in whose name any
certificate for shares of Series B Preferred Stock is issued upon exercise of
this Warrant shall for all purposes be deemed to have become the Holder of
record of such shares on the date on which this Warrant was surrendered and
payment of the Warrant Price, except that, if the date of such surrender and
payment is a date on which the stock transfer books of the Company are closed,
such person shall be deemed to have become the Holder of such shares at the
close of business on the next succeeding date on which the stock transfer books
are open. No fractional shares shall be issued upon exercise of this Warrant and
no payment or adjustment shall be made upon any exercise on account of any cash
dividends on the Series B Preferred Stock issued upon such exercise. If any
fractional interest in a share of Series B Preferred Stock would, except for the
provision of this Section 1, be delivered upon such exercise, the Company, in
lieu of delivery of a fractional share thereof, shall pay to the Holder an
amount in cash equal to the current fair market value of such fractional share.
Section 2. Net Issuance.
(1) Right to Convert. In addition to and without limiting the rights of
the Holder under the terms of this Warrant, the Holder shall have the right to
convert this Warrant or any portion thereof (the "Conversion Right") into shares
of Series B Preferred Stock as provided in this Section 2 at any time or from
time to time during the term of the Warrant. Upon exercise of the Conversion
Right with respect to a particular number of shares subject to the Warrant (the
"Converted Warrant Shares"), the Company shall deliver to the Holder (without
payment by the Holder of any exercise price or any cash or other consideration)
that number of shares of fully paid and nonassessable Series B Preferred Stock
computed using the following formula:
X = Y (A - B)
---------
A
Where X = the number of shares of Series B Preferred Stock to be
delivered to the holder
Y = the number of Converted Warrant Shares
-2-
3
A = the fair market value of one share of the Company's Series B
Preferred Stock on the Conversion Date (as defined below)
B = the per share exercise price of the Warrant (as adjusted to
the Conversion Date)
The Conversion Right may only be exercised with respect to a whole number of
shares subject to the Warrant. No fractional shares shall be issuable upon
exercise of the Conversion Right, and if the number of shares to be issued
determined in accordance with the foregoing formula is other than a whole
number, the Company shall pay to the Holder an amount in cash equal to the fair
market value of the resulting fractional share on the Conversion Date. Shares
issued pursuant to the Conversion Right shall be treated as if they were issued
upon the exercise of the Warrant.
(2) Method of Exercise. The Conversion Right may be exercised by the
Holder by the surrender of the Warrant at the principal office of the Company
together with a written statement specifying that the Holder thereby intends to
exercise the Conversion Right and indicating the total number of shares under
the Warrant that the Holder is exercising through the Conversion Right. Such
conversion shall be effective upon receipt by the Company of the Warrant
together with the aforesaid written statement, or on such later date as is
specified therein (the "Conversion Date"). Certificates for the shares issuable
upon exercise of the Conversion Right and, if applicable, a new warrant
evidencing the balance of the shares remaining subject to the Warrant, shall be
issued as of the Conversion Date and shall be delivered to the Holder promptly
following the Conversion Date.
(3) Determination of Fair Market Value. For purposes of Section 1 and
this Section 2, fair market value of a share of Common Stock on the Conversion
Date shall mean:
(i) If traded on a stock exchange, the fair market value of the
Common Stock shall be deemed to be the average of the closing selling prices of
the Series B Preferred Stock on the stock exchange determined by the Board to be
the primary market for the Series B Preferred Stock over the ten (10) trading
day period (or such shorter period immediately following the closing of an
initial public offering) ending on the date prior to the Conversion Date, as
such prices are officially quoted in the composite tape of transactions on such
exchange;
(ii) If traded over-the-counter, the fair market value of the
Series B Preferred Stock shall be deemed to be the average of the closing bid
prices (or, if such information is available, the closing selling prices) of the
Series B Preferred Stock over the ten (10) trading day period (or such shorter
period immediately following the closing of an initial public offering) ending
on the date prior to the Conversion Date, as such prices are reported by the
National Association of Securities Dealers through its NASDAQ system or any
successor system; and
-3-
4
(iii) If there is no public market for the Series B Preferred Stock,
then the fair market value shall be determined by the Company's Board of
Directors in good faith.
Section 3. Stock Splits, Consolidation, Merger and Sale. In the event the
outstanding shares of Series B Preferred Stock shall be split, combined or
consolidated, by dividend, reclassification or otherwise, into a greater or
lesser number of shares of Series B Preferred Stock, the Warrant Price in effect
immediately prior to such combination or consolidation and the number of shares
purchasable under this Warrant shall, concurrently with the effectiveness of
such combination or consolidation, be proportionately adjusted. If there shall
be effected any consolidation or merger of the Company with another corporation,
or a sale of all or substantially all of the Company's assets to another
corporation, and if the holders of Series B Preferred Stock shall be entitled
pursuant to the terms of any such transaction to receive stock, securities or
assets with respect to or in exchange for Series B Preferred Stock (or Common
Stock issued upon conversion of Series B Preferred Stock), then, as a condition
of such consolidation, merger or sale, lawful and adequate provisions shall be
made whereby the Holder of this Warrant shall thereafter have the right to
receive, upon the basis and upon the terms and conditions specified herein and
in lieu of the shares of Series B Preferred Stock immediately theretofore
receivable upon the exercise of such Warrant, such shares of stock, securities
or assets as may be issuable or payable with respect to or in exchange for a
number of outstanding shares of such Series B Preferred Stock equal to the
number of shares of such Series B Preferred Stock immediately theretofore so
receivable had such consolidation, merger or sale not taken place, and in any
such case appropriate provisions shall be made with respect to the rights and
interests of the Holder to the end that the provisions hereof shall thereafter
be applicable, as nearly as may be, in relation to any shares of stock,
securities or assets thereafter deliverable upon the exercise of this Warrant.
(1) Stock to Be Reserved.
(a) The Company will at all times reserve and keep available out of its
authorized Series B Preferred Stock solely for the purpose of issue upon the
exercise of this Warrant as herein provided, such number of shares of Series B
Preferred Stock as shall then be issuable upon the exercise of this Warrant. The
Company shall from time to time in accordance with applicable law increase the
authorized amount of its Series B Preferred Stock if at any time the number of
shares of Series B Preferred Stock remaining unissued and available for issuance
shall not be sufficient to permit exercise of this Warrant. The Company
covenants that all shares of Series B Preferred Stock which shall be so issued
shall be duly and validly issued and fully paid and nonassessable and free from
all taxes, liens and charges with respect to the issue thereof, and, without
limiting the generality of the foregoing, the Company will take all such action
as may be necessary to assure that all such shares of Series B Preferred Stock
may be so issued without violation of any applicable law or regulation, or of
any requirements of any national securities exchange upon which shares of
capital stock of the Company may be listed.
(b) The Company will at all times reserve and keep available out of its
authorized Common Stock, solely for the purpose of issue upon the conversion of
the Series B
-4-
5
Preferred Stock issuable upon exercise of this Warrant as herein provided, such
number of shares of Common Stock as shall then be issuable upon conversion of
the Series B Preferred Stock issuable upon exercise of this Warrant. The Company
shall from time to time in accordance with applicable law increase the
authorized amount of its Common Stock if at any time the number of shares of
Common Stock remaining unissued and available for issuance shall not be
sufficient to permit conversion of the shares of Series B Preferred Stock
issuable upon exercise of this Warrant. The Company covenants that all shares of
Common Stock which shall be so issued shall be duly and validly issued and fully
paid and non-assessable and free from all taxes, liens and charges with respect
to the issue thereof, and, without limiting the generality of the foregoing, the
Company will take all such action as may be reasonably necessary to assure that
all such shares of Common Stock may be so issued without violation of any
applicable law or regulation, or of any requirements of any national securities
exchange upon which shares of capital stock of the Company may be listed.
(2) Issue Tax. The issuance of certificates for shares of Series B
Preferred Stock upon exercise of this Warrant shall be made without charge to
the Holders of this Warrant for any issuance tax in respect thereof provided
that the Company shall not be required to pay any tax which may be payable in
respect of any transfer involved in the issuance and delivery of any certificate
in a name other than that of Holder of this Warrant.
(a) Closing of Books. The Company will at no time close its transfer
books against the transfer of the shares of Series B Preferred Stock (or Common
Stock issued upon the conversion of Series B Preferred Stock) issued or issuable
upon the exercise of this Warrant in any manner which interferes with the timely
exercise of this Warrant.
Section 4. Conversion of Series B Preferred Stock into Common Stock. Upon
conversion of all of the issued and outstanding shares of the Company's Series B
Preferred Stock into Common Stock this Warrant shall automatically be
exercisable only for such number of shares of Common Stock of the Company as the
Holder hereof would have received had this Warrant been exercised in full for
Series B Preferred Stock and then converted into Common Stock on the date all
issued and outstanding shares of Series B Preferred Stock converted into Common
Stock. The Warrant Price in effect immediately prior to such conversion shall,
concurrently with the effectiveness of such conversion, be proportionally
adjusted. Upon such conversion of Series B Preferred Stock into Common Stock all
references under this Warrant to Series B Preferred Stock shall be deemed to be
references to Common Stock.
Section 5. No Shareholder Rights or Liabilities. This Warrant shall not
entitle the Holder hereof to any voting rights or other rights as a shareholder
of the Company. No provision hereof, in the absence of affirmative action by the
Holder hereof to purchase shares of Series B Preferred Stock, and no mere
enumeration hereon of the rights or privileges of the Holder hereof, shall give
rise to any liability of such Holder for the Warrant Price or as a shareholder
of the Company, whether such liability is asserted by the Company or by
creditors of the Company.
-5-
6
Section 6. Representations of Holder. By acceptance of this Warrant, the
Holder hereby represents and acknowledges to the Company that:
(1) this Warrant, the Series B Preferred Stock issuable upon exercise of
this Warrant, and the Common Stock issuable upon conversion of the Series B
Preferred Stock and any securities issued with respect to any of them by way of
a stock dividend or stock split or in connection with a recapitalization,
merger, consolidation or other reorganization will be "restricted securities" as
such term is used in the rules and regulations under the Securities Act and that
such securities have not been and will not be registered under the Securities
Act or any state securities law, and that such securities must be held
indefinitely unless registration is effected or transfer can be made pursuant to
appropriate exemptions;
(2) the Holder has read, and fully understands, the terms of this
Warrant set forth on its face and the attachments hereto, including the
restrictions on transfer contained herein;
(3) the Holder has either a pre-existing personal or business
relationship with the Company or one of its officers, directors or controlling
persons;
(4) the Holder is purchasing for investment for its own account and not
with a view to or for sale in connection with any distribution of this Warrant,
the Series B Preferred Stock of the Company issuable upon exercise of this
Warrant or the Common Stock of the Company issuable upon conversion of the
Series B Preferred Stock and it has no intention of selling such securities in a
public distribution in violation of the federal securities laws or any
applicable state securities laws; provided that nothing contained herein will
prevent Holder from transferring such securities in compliance with the terms of
this Warrant and the applicable federal and state securities laws;
(5) the Holder is an "accredited investor" within the meaning of
paragraph (a) of Rule 501 of Regulation D promulgated by the Securities and
Exchange Commission and an "excluded purchaser" within the meaning of Section
25102(f) of the California Corporate Securities Law of 1968; and
(6) the Company may affix the following legend (in addition to any other
legend(s), if any, required by applicable state corporate and/or securities laws
to certificates for shares of Series B Preferred Stock (or other securities)
issued upon exercise of this Warrant and the shares of Common Stock issued upon
conversion of the Series B Preferred Stock ("Warrant Shares"):
"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED 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."
-6-
7
Section 7. Notice of Proposed Transfers. The Holder of this Warrant, by
acceptance hereof, agrees to comply in all respects with the provisions of this
Section 7. Prior to any proposed transfer of this Warrant or any Warrant Shares,
unless there is in effect a registration statement under the Securities Act
covering the proposed transfer, the Holder of such securities shall give written
notice to the Company of such Holder's intention to effect such transfer. Each
such notice shall describe the manner and circumstances of the proposed transfer
in sufficient detail and shall be accompanied (except in transactions in
compliance with Rule 144) by either (i) a written opinion of legal counsel who
shall be reasonably satisfactory to the Company addressed to the Company and
reasonably satisfactory in form and substance to the Company's counsel to the
effect that the proposed transfer of the Warrant and/or Warrant Shares may be
effected without registration under the Securities Act, or (ii) a "no action"
letter from the U.S. Securities and Exchange Commission (the "Commission") to
the effect that the transfer of such securities without registration will not
result in a recommendation by the staff of the Commission that enforcement
action be taken with respect thereto, whereupon the Holder of such securities
shall be entitled to transfer such securities in accordance with the terms of
the notice delivered by the Holder to the Company. Each new certificate
evidencing the Warrant and/or Warrant Shares so transferred shall bear the
appropriate restrictive legends set forth in Section 7 above, except that such
certificate shall not bear such restrictive legend if, in the opinion of counsel
for the Company, such legend is not required in order to establish or assist in
compliance with any provisions of the Securities Act or any applicable state
securities laws.
Section 8. Lost, Stolen, Mutilated or Destroyed Warrant. If this Warrant
is lost, stolen, mutilated or destroyed, the Company may, on such terms as to
indemnity or otherwise as it may in its discretion reasonably impose (which
shall, in the case of a mutilated Warrant, include the surrender thereof), issue
a new Warrant of like denomination and tenor as the Warrant so lost, stolen,
mutilated or destroyed. Any such new Warrant shall constitute an original
contractual obligation of the Company, whether or not the allegedly lost,
stolen, mutilated or destroyed Warrant shall be at any time enforceable by
anyone.
Section 9. Presentment. Prior to due presentment of this Warrant together
with a completed assignment form attached hereto for registration of transfer,
the Company may deem and treat the Holder as the absolute owner of the Warrant,
notwithstanding any notation of ownership or other writing thereon, for the
purpose of any exercise thereof and for all other purposes, and the Company
shall not be affected by any notice to the contrary.
Section 10. Notice. All notices, requests, demands, instructions,
payments, documents and other communications to be given hereunder shall be
governed by the applicable provisions of the Note.
Section 11. Governing Law. The validity, interpretation and performance of
this Warrant shall be governed by the laws of the State of California without
regard to principles of conflicts of laws.
-7-
8
Section 12. Successors Assigns. Subject to the restrictions on transfer by
Holder set forth in Section 8 hereof, all the terms and provisions of the
Warrant shall be binding upon and inure to the benefit and be enforceable by the
respective successors and assigns of the parties hereto.
Section 13. Amendment. This Warrant may be modified or amended by a
writing signed by the Company and the Holder.
Section 14. Severability. Should any part but not the whole of this
Warrant for any reason be declared invalid, such decision shall not affect the
validity of any remaining portion, which remaining portion shall remain in force
and effect as if this Warrant had been executed with the invalid portion thereof
eliminated, and it is hereby declared the intention of the parties hereto that
they would have executed the remaining portion of this Warrant without including
therein any such part which may, for any reason, be hereafter declared invalid.
IN WITNESS WHEREOF, the Company has caused this Warrant to be duly
executed and delivered on and as of the day and year first above written by one
of its officers thereunto duly authorized.
Dated: April 11, 1995
NANOGEN, INC., a California corporation
By /s/ XXXXXX XXXXXXXX
----------------------------------------
Xxxxxx Xxxxxxxx, Chief Executive Officer
-8-
9
PURCHASE FORM
(To be executed by the Warrant Holder if he desires to exercise the Warrant in
whole or in part)
To: NANOGEN, INC.
The undersigned, whose Social Security or other identifying number
is__________, hereby irrevocably elects the right of purchase represented by the
within Warrant for, and to purchase thereunder, ____________________
__________ shares of securities provided for therein and tenders payment
herewith to the order of:
NANOGEN, INC.
in the amount of
$__________
The undersigned requests that certificates for such shares be issued as follows:
Name: __________________________________________________________________________
Address: _______________________________________________________________________
Deliver to: ____________________________________________________________________
Address: _______________________________________________________________________
and, if said number of shares shall not be all the shares purchasable hereunder,
that a new Warrant for the balance remaining of the shares purchasable under the
within Warrant be registered in the name of, and delivered to, the undersigned
at the address stated below:
Address: _______________________________________________________________________
Dated: __________, 19__
-----------------------------------------------
(Signature must conform in all respects to
the name of the Warrant Holder as specified
on the face of the Warrant, without alteration,
enlargement or any change whatsoever)
10
ASSIGNMENT
(To be executed by the Warrant Holder if he desires to effect a transfer of the
Warrant)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto ____________________ whose Social Security or other identification number
is __________ [residing/located] at ______________________________ the attached
Warrant, and appoints ____________________ residing at _________________________
the undersigned's attorney-in-fact to transfer said Warrant on the books of the
Company, with full power of substitution in the premises.
Dated: __________, 19__
In the presence of:
----------------------------------- -----------------------------------------
(Signature must conform in all respects to
the name of the Warrant Holder as
specified on the face of the Warrant,
without alteration, enlargement
or any change whatsoever).
