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Exhibit 10.35
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE
SECURITIES LAWS AND MAY NOT BE TRANSFERRED, SOLD OR OFFERED FOR SALE EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AS TO THIS WARRANT AND THE
SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT UNDER SAID ACT AND ANY
APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
VOID AFTER 5:00 P.M., NEW YORK TIME, ON OCTOBER 15, 2006, OR IF NOT A BUSINESS
DAY, AS DEFINED HEREIN, AT 5:00 P.M., NEW YORK TIME, ON THE NEXT FOLLOWING
BUSINESS DAY.
WARRANT TO PURCHASE
_________ DEPOSITARY SHARES
WARRANT TO PURCHASE DEPOSITARY SHARES
OF
ASCENT PEDIATRICS, INC.
--------------------------
This certifies that, for value received, ____________ or
registered assigns ("Warrantholder"), is entitled to purchase from Ascent
Pediatrics, Inc., a Delaware corporation (the "Company"), subject to the terms
set forth below, at any time prior to the Expiration Date, after which time this
Warrant shall become void, _________ Warrant Shares at the Warrant Price. The
Warrant Price and the number of Warrant Shares purchasable hereunder are subject
to adjustment from time to time as provided herein.
This Warrant is one of a series of warrants (the "Warrants")
evidencing the right to purchase Depositary Shares of the Company issued
pursuant to a certain Fourth Amendment (the "Fourth Amendment"), dated as of
October 15, 1999, to the Series G Securities Purchase Agreement, dated as of May
13, 1998, by and between the Company and the persons named therein, as amended
(such Securities Purchase Agreement, as amended on September 30, 1998, February
16, 1999 and July 1, 1999 and by the Fourth Amendment being referred to herein
as the "Purchase Agreement"), copies of which Purchase Agreement are on file at
the principal office of the Company, and the holder of this Warrant shall be
entitled to all of the benefits of and be bound by all of the applicable
obligations of the Purchase Agreement, as provided therein.
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ARTICLE I
DEFINED TERMS
Section 1.1. DEFINITION OF TERMS. As used in this Warrant, the following
capitalized terms shall have the following respective meanings:
(a) "Business Day" shall mean a day other than a Saturday,
Sunday or other day on which banks in the State of New York or the Commonwealth
of Massachusetts are authorized by law to remain closed.
(b) "Convertible Notes" shall mean the 7.5% Convertible
Subordinated Notes due July 1, 2004 issued pursuant to the Third Amendment dated
as of July 1, 1999 to the Purchase Agreement, the 7.5% Convertible Subordinated
Notes due July 1, 2004 issuable pursuant to the Fourth Amendment and the 8.0%
Convertible Subordinated Notes issued on July 23, 1999 pursuant to the Purchase
Agreement.
(c) "Common Stock" shall mean the Common Stock, $.00004 par
value per share, of the Company.
(d) "Closing Price" shall mean, with respect to any day, the
last reported sales price of the Depositary Shares, regular way, or in case no
sale takes place on such day, the average of the reported closing bid and asked
prices of the Depositary Shares, regular way, in either case as reported on the
principal national securities exchange on which the Depositary Shares is listed
or admitted to trading or, if the Depositary Shares are not listed or admitted
to trading on any national securities exchange, but is traded in the
over-the-counter market, the closing sale price of the Depositary Shares or in
case no sale is publicly reported, the average of the representative closing bid
and asked quotations for the Depositary Shares on the Nasdaq National Market,
or, if bid and asked prices for such day shall not have been reported on The
Nasdaq Stock Market, the average of the bid and asked prices for the Depositary
Shares as furnished by any New York Stock Exchange, Inc. member firm regularly
making a market in the Depositary Shares and selected for such purpose by the
Board of Directors of the Company.
(e) "Depositary Shares" means the depositary shares of the
Company issued pursuant to the Depositary Agreement dated as of February 16,
1999 by and among the Company, Alpharma USPD Inc. and State Street Bank and
Trust Company, as amended (the "Depositary Agreement"), each Depositary Share
representing one share of Common Stock of the Company subject to a call option
and represented by a depositary receipt.
(f) "Expiration Date" shall mean the earlier of (a)
October 15, 2006, or if such day is not a Business Day, the next succeeding day
which is a Business Day.
(g) "Fair Market Value" with respect to the date of any
exercise by the Warrantholder of all or a portion of this Warrant, shall mean
the average daily Closing Price of the Depositary Shares, as applicable, for
thirty (30) consecutive trading days commencing forty-five (45) days before the
date of such exercise by the Warrantholder of all or a portion of this Warrant,
PROVIDED, HOWEVER, that where no public market exists for the Depositary Shares
at the
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time of the exercise of all or a portion of this Warrant, the fair market
value per share shall be determined by the Company's Board of Directors in good
faith.
(h) "Fourth Amendment" shall mean the Fourth Amendment, dated
as of October 15, 1999, to the Purchase Agreement.
(i) "Person" shall mean any individual, corporation,
association, company, business trust, partnership, limited liability company,
joint venture, joint-stock company, trust, unincorporated organization,
association or any other entity or government or any agency or political
subdivision thereof.
(j) "Purchase Agreement" shall mean that certain Securities
Purchase Agreement, dated as of May 13, 1998, among the Company and the persons
named therein, as amended.
(k) "Related Person" of any Person means any other Person
directly or indirectly owning (A) twenty percent (20%) or more of the
outstanding common stock of such Person (or, in the case of a Person that is not
a corporation, twenty percent (20%) or more of the equity interest in such
Person) or (B) twenty percent (20%) or more of the combined voting power of the
voting capital stock of such Person.
(l) "Securities Act" shall mean the Securities Act of 1933, as
amended.
(m) "Subordinated Notes" shall mean the Company's 8%
Subordinated Notes due 2005 issued pursuant to the Purchase Agreement.
(n) "Third Amendment" shall mean the Third Amendment, dated as
of July 1, 1999, to the Purchase Agreement.
(o) "Warrant Price" shall mean Three Dollars ($3.00) per
Warrant Share, as such price may be adjusted from time to time pursuant to
Article III hereof.
(p) "Warrant Shares" shall mean the Depositary Shares
purchasable upon exercise of this Warrant.
ARTICLE II
DURATION AND EXERCISE OF WARRANT
Section 2.1. EXERCISE OF WARRANT. The Warrantholder may
exercise this Warrant, in whole or in part, by presentation and surrender of
this Warrant at the address of the Company set forth in Section 4.6 hereof or at
such other address as the Company may designate by notice in writing to the
Warrantholder with the Subscription Form annexed hereto duly executed,
accompanied by payment of the Warrant Price for each Warrant Share purchased.
Upon receipt thereof, the Company shall cause to be issued certificates for the
Warrant Shares so purchased in such denominations as are requested for delivery
to the Warrantholder. Such certificates shall be delivered as promptly as
practicable to the Warrantholder. Upon any partial exercise of this
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Warrant, the Company shall execute and deliver a new Warrant of like tenor
and date for the balance of the Warrant Shares purchasable hereunder. Upon
exercise, the Warrantholder shall be deemed to be the holder of record of
Depositary Shares issuable upon such exercise, notwithstanding that the stock
transfer books of the Company shall then be closed or that certificates
representing such Depositary Shares shall not then be actually delivered to the
Warrantholder. If at the time this Warrant is exercised, a registration
statement is not in effect to register under the Securities Act the Warrant
Shares issuable upon exercise of this Warrant, the Company may require the
Warrantholder to make such representations, and may place such legends on
certificates representing the Warrant Shares, as may be reasonably required to
permit the Warrant Shares to be issued without such registration. The Company
shall pay any and all stock transfer and similar taxes which may be payable in
respect of the issue of the Warrant or in respect of the issue of any of the
Warrant Shares, except the Company shall not pay such transfer taxes if the
Warrant Shares are issued to a Person other than the Warrantholder.
Section 2.2. RESERVATION OF SHARES. The Company hereby agrees
that at all times there shall be reserved for issuance and delivery upon
exercise of this Warrant such number of Depositary Shares or other shares of
capital stock of the Company as may be from time to time issuable upon exercise
of this Warrant. All such shares shall be duly authorized, and when issued upon
such exercise, shall be validly issued, fully paid and nonassessable, free and
clear of all liens, security interests, charges and other encumbrances or
restrictions, other than those restrictions imposed by the Securities Act of
1933, and free and clear of all preemptive and similar rights.
Section 2.3. FRACTIONAL SHARES. The Company shall not be
required to issue any fraction of a Depositary Share in connection with the
exercise of this Warrant, and in any case where the Warrantholder would, except
for the provisions of this Section 2.3, be entitled under the terms of this
Warrant to receive a fraction of a share upon the exercise of this Warrant, the
Company shall, upon the exercise of this Warrant and receipt of the Warrant
Price (as adjusted to cover the balance of the share), issue the largest number
of whole shares purchasable upon exercise of this Warrant, but in no event shall
the Company issue more than such number of Depositary Shares as are issuable
pursuant to the exercise of this Warrant. The Company shall not be required to
make any cash or other adjustment in respect of such fraction of a share to
which the Warrantholder would otherwise be entitled.
Section 2.4. PAYMENT FOR WARRANT SHARES.
(a) Payment of the aggregate Warrant Price for Warrant Shares
to be purchased upon exercise of all or a portion of this Warrant shall be made
in full by delivery to the Company, at its address set forth in Section 4.6
hereof or at such other address as the Company may designate by notice in
writing to the Warrantholder, of a certified or bank cashier's check or by wire
transfer to an account in the United States designated by the Company.
(b) Payment of the aggregate Warrant Price may also be made in
full by (i) delivery to the Company of Convertible Notes plus accrued interest
thereon, in an aggregate principal amount equal to the aggregate Warrant Price,
(ii) delivery to the Company of Subordinated Notes plus accrued interest
thereon, in an aggregate principal amount equal to the
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aggregate Warrant Price or (iii) a combination of cash (payable by wire
transfer or certified or bank check), Convertible Notes or Subordinated Notes
beneficially owned by such Warrantholder and such accumulated dividends or
accrued interest, as the case may be, in an aggregate principal amount equal to
the aggregate Warrant Price. Any Convertible Notes or Subordinated Notes
surrendered for exchange hereunder shall be, if so required by the Company,
accompanied by a written instrument or instruments of transfer in form
satisfactory to the Company duly delivered by the Warrantholder.
(c) Notwithstanding any provisions herein to the contrary, if
the Fair Market Value of one Depositary Share is greater than the Warrant Price
(at the date of calculation as set forth below), in lieu of exercising this
Warrant for cash, the Warrantholder may elect to receive shares equal to the
value (as determined below) of this Warrant (or the portion thereof, which
portion shall be canceled) by surrender of this Warrant at the principal office
of the Company together with the properly endorsed Subscription Form annexed
hereto and notice of such election in which event the Company shall issue to the
Warrantholder a number of Depositary Shares computed using the following
formula:
X = Y(A-B)
-----
A
Where X = the number of Depositary Shares to be issued
to the Warrantholder
Y = the number of Depositary Shares
purchasable under the Warrant or, if
only a portion of the Warrant is
being exercised, the portion of the
Warrant being canceled (at the date
of such calculation)
A = the Fair Market Value of one Depositary
Share (at the date of such calculation)
B = Warrant Price (as adjusted to the date of
such calculation)
ARTICLE III
ADJUSTMENT OF WARRANT PRICE OR WARRANT SHARES
Section 3.1. ADJUSTMENT OF WARRANT PRICE.
(a) Except as hereinafter provided, in case the Company shall
at any time after the date hereof issue or sell any obligations or Depositary
Shares, for a consideration per share less than the Warrant Price in effect
immediately prior to the issuance or sale of such shares, or without
consideration, then, and thereafter successively upon each issuance or sale, the
Warrant Price in effect immediately prior to each such issuance or sale shall
forthwith be reduced to a price determined by dividing (i) an amount equal to
(X) the total number of
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Depositary Shares outstanding immediately prior to such issuance or sale
multiplied by the Warrant Price in effect immediately prior to such issuance or
sale, plus (Y) the consideration, if any, received by the Company upon such
issuance or sale, by (ii) the total number of Depositary Shares outstanding
immediately after such issuance or sale.
For the purposes of any computation to be made in
accordance with the provisions of this paragraph (a), the following shall be
applicable:
(i) In case of the issuance or sale
of Depositary Shares for a consideration part or all
of which shall be cash, the amount of the cash
consideration therefor shall be deemed to be the
amount of cash received by the Company for such
shares (or, if such Depositary Shares are offered by
the Company for subscription, the subscription price,
or, if Depositary Shares shall be sold to
underwriters or dealers for public offering without a
subscription offering, the public offering price)
before deducting therefrom any commissions or other
expenses paid or incurred by the Company for any
underwriting of, or otherwise in connection with the
issuance of such shares;
(ii) In case of the issuance or sale
of Depositary Shares for a consideration part or all
of which shall be other than cash (otherwise than as
a dividend or other distribution on any Depositary
Shares of the Company or on conversion, exercise or
exchange of other securities of the Company or upon
acquisition of the assets or securities of another
company or upon merger or consolidation with another
entity), the amount of consideration therefor other
than cash shall be the value of such consideration as
of the date of the issuance or sale of the Depositary
Shares, irrespective of accounting treatment, but as
determined by the Board of Directors of the Company
in good faith. The reclassification of securities
other than Depositary Shares into Depositary Shares
shall be deemed to involve the issuance for a
consideration other than cash of such Depositary
Shares immediately prior to the close of business on
the date fixed for the determination of security
holders entitled to receive such Depositary Shares;
(iii) In case of the issuance of
Depositary Shares upon conversion or exchange of any
obligations or of any securities of the Company that
shall be convertible into or exchangeable for
Depositary Shares or upon the exercise of rights or
options to subscribe for or to purchase Depositary
Shares (other than upon exercise of this Warrant),
the amount of consideration received by the Company
for such Depositary Shares shall be deemed to be the
sum of (A) the amount of the consideration received
by the Company upon the original issuance of such
obligations, shares, rights or options, as the case
may be, plus (B) the consideration, if any, other
than such obligations, shares, rights or options,
received by the Company upon such conversion,
exchange, or exercise
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except in adjustment of interest and dividends. The
amount of the consideration received by the Company
upon the original issuance of the obligations,
shares, rights or options so converted, exchanged or
exercised and the amount of the consideration, if
any, other than such obligations, shares, rights or
options, received by the Company upon such
conversion, exchange or exercise shall be determined
in the same manner provided in subparagraphs (i) and
(ii) above with respect to the consideration received
by the Company in case of the issuance of Depositary
Shares; if such obligations, shares, rights or
options shall have been issued as a dividend upon any
securities of the Company, the amount of the
consideration received by the Company upon the
original issuance thereof shall be deemed to be zero.
In case of the issuance of Warrant Shares upon
exercise of this Warrant, the Company shall be deemed
to have received the Warrant Price then in effect as
the consideration for each Depositary Share so
issued;
(iv) Depositary Shares issuable by
way of dividend or other distribution on any
securities of the Company shall be deemed to have
been issued and to be outstanding at the close of
business on the record date fixed for the
determination of security holders entitled to receive
such dividend or other distribution and shall be
deemed to have been issued without consideration.
Depositary Shares issued otherwise than as a
dividend, shall be deemed to have been issued and to
be outstanding at the close of business on the date
of issue;
(v) The number of Depositary Shares
at any time outstanding shall not include any shares
then owned or held by or for the account of the
Company, but shall include the aggregate number of
shares deliverable in respect of options, rights and
exercisable, convertible and exchangeable securities
at all times while such options, rights or securities
remain outstanding and unexercised, unconverted or
unexchanged, as the case may be; and
(vi) No adjustment shall be made to
the Warrant Price in effect upon conversion or
exchange of (i) securities convertible or exercisable
or exchangeable for Depositary Shares or for other
securities that are subsequently exercisable for
Depositary Shares that are outstanding as of the date
of the Fourth Amendment, or (ii) any obligations or
any securities of the Company that shall be
convertible into or exercisable or exchangeable for
Depositary Shares or upon the exercise of rights or
options to subscribe for or to purchase Depositary
Shares for which an adjustment in the Warrant Price
has previously been made in accordance with paragraph
(b) of this Section 3.1.
(vii) In the event that any payment
is made to the holders of warrants issued pursuant to
the Securities Purchase Agreement dated as of January
31, 1997 among the Company, Triumph Connecticut
Limited
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Partnership and the other purchasers named therein
pursuant to Section 8.3(b) (or successor provision)
of such Securities Purchase Agreement which does not
result in a modification pursuant to Section 3.4, the
Company shall be deemed to have issued without
consideration as of the date of the event giving rise
to such payment a number of Depositary Shares equal
to the amount of such payment divided by the Closing
Price on the date of such event.
(b) In case the Company shall at any time after the date
hereof issue options or rights to subscribe for Depositary Shares, or issue any
obligations or securities convertible into or exchangeable for Depositary
Shares, otherwise than as contemplated by Section 3.1(a)(vi) or pursuant to
Section 3.3 hereof, for a consideration per share less than the Warrant Price in
effect immediately prior to the issuance of such options or rights or
convertible or exchangeable securities, or without consideration, the Warrant
Price in effect immediately prior to the issuance of such options or rights or
securities shall be reduced to a price determined by making a computation in
accordance with the provisions of paragraph (a) of this Section 3.1, provided
that:
(i) the aggregate maximum number of Depositary Shares
deliverable under such options or rights shall be considered to have
been delivered at the time such options or rights were issued, and for a
consideration equal to the minimum purchase price per Depositary Share provided
for in such options or rights, plus the consideration (determined in the same
manner as consideration received on the issue or sale of Depositary Shares), if
any, received by the Company for such options or rights;
(ii) the aggregate maximum number of Depositary
Shares deliverable upon conversion of or exchange for any such obligations or
securities shall be considered to have been delivered at the time of issuance of
such securities, and for a consideration equal to the consideration (determined
in the same manner as consideration received on the issue or sale of Depositary
Shares) received by the Company for such securities, plus the consideration, if
any, to be received by the Company upon the exchange or conversion thereof; and
(iii) on the expiration of such options or rights, or
an increase in the minimum exercise price thereof, or a decrease in the
maximum number of Depositary Shares deliverable upon exercise or conversion of
such options, rights or convertible or exchangeable securities pursuant to the
terms thereof (and not as a result of exercise or conversion), or the
termination of such right to convert or exchange, the Warrant Price in effect
shall forthwith be readjusted to such Warrant Price as would have obtained (A)
in the case of the expiration or termination of options or rights or the
termination of the right to convert or exchange convertible or exchangeable
securities, had no adjustments been made upon the issuance of such options,
rights or convertible or exchangeable securities, or (B) in the case of an
increase in the minimum exercise price thereof, or a decrease in the maximum
number of shares deliverable thereunder, had the adjustments made upon the
issuance of such options, rights or convertible or exchangeable securities been
made upon the basis of the delivery of only the number of Depositary Shares (A)
actually deliverable upon the exercise of such options or rights or upon
conversion or exchange of such securities, or (B) deliverable by reason of such
increase in price or decrease in number of shares.
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(c) No adjustment to the Warrant Price shall be made in
connection with the issuance of:
(i) the Convertible Notes, the
Warrants issued pursuant to the Third Amendment, the
Warrants issued pursuant to the Fourth Amendment, the
Warrants issued pursuant to the Purchase Agreement
and the New Warrants, as such term is defined in the
Purchase Agreement (together, the "Convertible
Securities"), and the securities issued or issuable
upon conversion or exercise of the Convertible
Securities, or other currently outstanding securities
that are convertible, exercisable or exchangeable for
Depositary Shares; and
(ii) Depositary Shares or rights,
options or warrants to acquire Depositary Shares
issued to directors, employees or consultants of the
Company pursuant to a stock option plan or agreement
(and, in the case of rights, options, or warrants,
the Depositary Shares issued or issuable upon
exercise thereof) and approved by the Board of
Directors;
(d) In case the Company shall at any time after the date
hereof subdivide or combine the outstanding Depositary Shares, the Warrant Price
in effect shall forthwith be proportionately decreased in the case of the
subdivision or proportionately increased in the case of combination to the
nearest one cent. Any such adjustment shall become effective at the close of
business on the date that such subdivision or combination shall become
effective.
(e) No adjustment to the Warrant Price shall be made in
connection with the conversion of all outstanding Depositary Shares into shares
of Common Stock on the Option Expiration Date (as defined in the Depositary
Agreement) pursuant to the terms of the Depositary Agreement.
Section 3.2. ADJUSTMENT OF WARRANT SHARES. In the event of an
adjustment of the Warrant Price, the number of Depositary Shares (or
reclassified or recapitalized stock) issuable upon exercise of this Warrant
after such adjustment shall be equal to the number determined by multiplying the
number of Depositary Shares issuable upon exercise of this Warrant immediately
prior to such adjustment by a fraction, of which the numerator is the Warrant
Price in effect immediately prior to such adjustments, and the denominator is
the Warrant Price in effect immediately after such adjustment.
Section 3.3. DIVIDENDS AND DISTRIBUTIONS. In the event that
the Company shall at any time after the date hereof pay any dividend (other than
in Depositary Shares) on, or make any distribution of its assets upon or with
respect to, the Depositary Shares, or in the event that the Company shall offer
options or rights to subscribe for Depositary Shares, or issue any securities
convertible into or exchangeable for Depositary Shares, to all of its holders of
Depositary Shares, then on the record date for such payment, distribution or
offer or, in the absence of a record date, on the date of such payment,
distribution or offer, the Warrantholder shall receive what the Warrantholder
would have received had it exercised this Warrant in full
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immediately prior to the record date of such payment, distribution or offer or,
in the absence of a record date, immediately prior to the date of such payment,
distribution or offer.
Section 3.4. MERGERS, CONSOLIDATIONS, RECLASSIFICATIONS. In
the case of any reorganization or reclassification of the outstanding Depositary
Shares (other than a change in par value, or from par value to no par value, or
from no par value to par value, or as a result of a subdivision or combination)
or in the case of any consolidation of the Company into, or merger of the
Company with another corporation in which it is not the surviving entity (or it
is the surviving entity, but its Depositary Shares become shares of another
corporation), or in the case of any sale, lease or conveyance of all, or
substantially all, of the property, assets, business and goodwill of the Company
as an entirety, the Warrantholder shall thereafter have the right upon exercise
of this Warrant to receive the kind and amount of shares of stock and other
securities, cash and property receivable upon such reorganization,
reclassification, consolidation, merger or disposition by a holder of the number
of Depositary Shares which the Warrantholder would have received had it
exercised this Warrant immediately prior to such reorganization,
reclassification, consolidation, merger or disposition, at a price equal to the
aggregate Warrant Price then in effect for exercising this Warrant in full (the
kind, amount and price of such stock and other securities to be subject to
adjustment as herein provided); provided, however, that the kind and amount of
such shares of stock and other securities, cash and other property shall be
determined as if any payment made to the holders of warrants issued pursuant to
the Securities Purchase Agreement dated as of January 31, 1997 among the
Company, Triumph Connecticut Limited Partnership and the other purchasers named
therein upon such reorganization, reclassification, consolidation, merger or
disposition in excess of the amount such holders would otherwise have been
entitled to receive under the terms of such warrants without regard to Section
8.3(b) (or successor provision) of such Securities Purchase Agreement had not
been made. The foregoing provisions of this Section 3.4 shall similarly apply to
successive reorganizations, reclassifications, consolidations, mergers and
dispositions.
Section 3.5. NOTICE OF ADJUSTMENT. Whenever the Warrant Price
or the number of Warrant Shares shall be adjusted pursuant to the provisions of
Article III, the Company shall prepare and deliver forthwith to the
Warrantholder a certificate signed by the President of the Company and by its
Chief Financial Officer, setting forth the adjusted number of Warrant Shares
purchasable upon the exercise of this Warrant and the Warrant Price calculated
to the nearest cent and setting forth in reasonable detail the method of
calculation and the facts requiring such adjustment and upon which such
calculation is based.
Section 3.6. NOTICE OF CERTAIN CORPORATE ACTION. In case at
any time:
(A) the Company shall declare any
dividend (or any other
distributions) on Depositary
Shares; or
(B) the Company shall authorize the
granting to all holders of its
Depositary Shares of rights to
subscribe for or purchase any shares
of stock of any class or of any
other rights; or
(C) there shall be any reclassification
of the Depositary Shares or capital
stock of the Company; or
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(D) there shall be any capital
reorganization by the Company; or
(E) there shall be any (i) consolidation
or merger involving the Company,
other than the merger contemplated
by the Merger Agreement, or (ii)
sale, transfer or other disposition
of all or substantially all of the
Company's property, assets or
business (except a merger or other
reorganization in which the Company
shall be the surviving corporation
and its shares of capital stock
shall continue to be outstanding and
unchanged and except a
consolidation, merger, sale,
transfer or other disposition
involving a wholly-owned
subsidiary); or
(F) there shall be a voluntary or
involuntary dissolution, liquidation
or winding-up of the Company or any
partial liquidation of the Company
or distribution to holders of
Depositary Shares;
then, in each of such cases, the Company shall give written notice to the
Warrantholder of the date on which (i) the books of the Company shall close or a
record date shall be fixed for such dividend, distribution or subscription
rights or (ii) such reorganization, reclassification, consolidation, merger,
disposition, dissolution, liquidation or winding-up, as the case may be, shall
take place. Such notice also shall specify the date as of which the holders of
Depositary Shares of record shall participate in such dividend, distribution or
subscription rights, or shall be entitled to exchange their depositary receipts
for Depositary Shares for securities or other property deliverable upon such
reorganization, reclassification, consolidation, merger, disposition,
dissolution, liquidation or winding-up, as the case may be. Such notice shall be
given at least twenty (20) days prior to the action in question and not less
than twenty (20) days prior to the record date or the date on which the
Company's transfer books are closed in respect thereto.
Section 3.7. ADJUSTMENT FOR EXPIRATION OF CALL OPTION. From
and after the Option Expiration Date, this Warrant shall be exercisable into a
number of shares of Common Stock of the Company equal to the number of shares of
Common Stock that the Warrantholder would have received upon the exchange of the
Depositary Shares that the Warrantholder would have received had it exercised
this Warrant in full immediately prior to the Option Expiration Date. From and
after the Option Expiration Date, all references herein to Depositary Shares
shall be deemed to include the Common Stock of the Company.
Section 3.8. FORM OF WARRANT AFTER ADJUSTMENTS. The form of
this Warrant need not be changed because of any adjustments in the Warrant Price
or the number or kind of the Warrant Shares.
ARTICLE IV
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MISCELLANEOUS
Section 4.1. SUCCESSORS AND ASSIGNS; TRANSFERS.
(a) The terms of this Warrant shall be binding upon, inure to
the benefit of and be enforceable by and against any successors or assigns of
the Company and of the Warrantholder; PROVIDED, HOWEVER, that the Company may
not assign its rights or obligations hereunder.
(b) Subject to the provisions of paragraph (f) below and
Section 17.3 of the Purchase Agreement, this Warrant and all rights hereunder
are transferable by the Warrantholder, in whole or in party, upon surrender of
this Warrant with a properly executed assignment at the principal office of the
Company.
(c) Any transferee to whom rights hereunder are transferred
shall, as a condition to such transfer, deliver to the Company a written
instrument by which such transferee agrees to be bound by the obligations
imposed upon the Warrantholder under this Warrant to the same extent as if such
transferee was the Warrantholder.
(d) The Company will maintain a register containing the names
and addresses of the Warrantholders of the Warrants. Any Warrantholder may
change its or his address as shown on the warrant register by written notice to
the Company requesting such change.
(e) Until any transfer of this Warrant is made in the warrant
register, the Company may treat the Warrantholder as the absolute owner hereof
for all purposes; provided, however, that if and when this Warrant is properly
assigned in blank, the Company may (but shall not be obligated to) treat the
bearer hereof as the absolute owner hereof for all purposes, notwithstanding any
notice to the contrary.
(f) This Warrant and the Warrant Shares shall not be sold or
transferred unless either (i) they first shall have been registered under the
Securities Act or (ii) the Company first shall have been furnished with an
opinion of legal counsel, reasonably satisfactory to the Company, to the effect
that such sale or transfer is exempt from the registration requirements of the
Securities Act.
(g) Each certificate representing Warrant Shares shall bear a
legend substantially in the following form:
"The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended, and
may not be offered, sold or otherwise transferred, pledged or
hypothecated unless and until such securities are registered
under such Act or an opinion of counsel reasonably
satisfactory to the Company is obtained to the effect that
such registration is not required."
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The foregoing legend shall be removed from the certificates
representing any Warrant Shares, at the request of the holder thereof, at such
time as they become eligible for resale pursuant to Rule 144(k) under the
Securities Act.
Section 4.2. RIGHTS AS STOCKHOLDER. Except as provided herein,
the Warrantholder, as such, shall not be entitled to vote or be deemed to be a
stockholder of the Company for any purpose, nor shall anything contained in this
Warrant be construed to confer upon the Warrantholder, as such, any rights of a
stockholder of the Company or any right to vote, give or withhold consent to any
corporate action or receive notice of meetings.
Section 4.3. ACCEPTANCE BY WARRANTHOLDER. Receipt of this
Warrant by the Warrantholder shall constitute acceptance of an agreement to the
foregoing terms and conditions.
Section 4.4. GOVERNING LAW. This Warrant and the rights of the
parties hereunder shall be governed in all respects by the laws of the State of
New York, without giving effect to the provisions thereof relating to conflicts
of law.
Section 4.5. SEVERABILITY. In case any provision of this
Warrant shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
Section 4.6. NOTICES. Any notices or certificates by the
Company to the Warrantholder and by the Warrantholder to the Company shall be
deemed delivered if in writing and delivered in person or by registered mail
(return receipt requested) to the Warrantholder, at its address in the registry
of Warrantholders maintained by the Company, and if to the Company, at 000
Xxxxxxxxxxx Xxxxxx, Xxxxx X000, Xxxxxxxxxx, XX 00000, Attention: Principal
Financial Officer. The Company may change its address by written notice to the
Warrantholder.
Section 4.7. AMENDMENT. This Warrant may be amended or
modified (or any provision hereof waived) only if Warrantholders holding at
least eighty percent (80%) of the Warrant Shares (assuming exercise of all the
Warrants) shall approve such amendment, modification or waiver in writing;
PROVIDED, HOWEVER, that no amendment that adversely affects the rights of any
Warrantholder in a manner different from the rights of the other Warrantholders
shall be effective against such Warrantholder unless approved in writing by such
Warrantholder. After an amendment, modification or waiver of a provision the
Warrants becomes effective, the Company shall mail to the Warrantholders a
notice briefly describing the amendment, modification or waiver.
IN WITNESS WHEREOF, this Warrant has been duly executed by the
Company under its corporate seal as of the 15th day of October, 1999.
ASCENT PEDIATRICS, INC.
By:_________________________________
Name:
Its:
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