WARRANT AGREEMENT
Exhibit
10.1
WARRANT
AGREEMENT, dated
as
of May 10, 2007 (this “Agreement”),
between DOV
PHARMACEUTICAL, INC.,
a
Delaware corporation, with offices at 000 Xxxxxx Xxxxxx, Xxxxxxxx, XX 00000
(the
“Company”),
and
CONTINENTAL
STOCK TRANSFER & TRUST COMPANY,
with
offices at 00 Xxxxxxx Xxxxx, Xxx Xxxx, XX 00000 (the “Warrant
Agent”).
W
I T N E S S E T H:
WHEREAS,
the
Company currently contemplates distributing or otherwise delivering number
up to
30,000,000 Warrants (“Warrants”)
to
holders of the Company’s common stock, par value $0.0001 per share
(“Common
Stock”),
each
Warrant evidencing the right of the holder thereof to purchase one share of
Common Stock of the Company for $0.523, subject to adjustment as described
herein;
WHEREAS,
the
Company will distribute Warrants to purchase 11 shares of Common Stock for
each
10 shares of Common Stock held by a holder of Common Stock.
WHEREAS,
the
Company desires to have the Warrant Agent act on behalf of the Company, and
the
Warrant Agent is willing to so act, in connection with the issuance,
registration, transfer, exchange, redemption and exercise of the Warrants;
WHEREAS,
the
Company desires to provide for the form and provisions of the Warrants, the
terms upon which they shall be issued and exercised, and the respective rights,
limitation of rights and immunities of the Company, the Warrant Agent and the
holders of the Warrants; and
WHEREAS,
all
acts and things have been done and performed which are necessary to make the
Warrants, when executed on behalf of the Company and countersigned by or on
behalf of the Warrant Agent, as provided herein, the valid, binding and legal
obligations of the Company, and to authorize the execution and delivery of
this
Agreement.
NOW,
THEREFORE,
in
consideration of the premises, representations and warranties and the mutual
covenants and agreements contained herein and other good, valuable and
sufficient consideration, the receipt of which is hereby acknowledged, the
Parties, intending to be legally bound, agree as follows:
1. Appointment
of Warrant Agent. The
Company hereby appoints the Warrant Agent to act as agent for the Company
relating to the Warrants in accordance with the terms and conditions of this
Agreement, and the Warrant Agent hereby accepts such appointment and agrees
to
act in accordance with such terms and conditions.
2. Warrants..
2.1. Form
of Warrant.
Each
Warrant shall be in substantially the form of Exhibit
A
hereto,
the provisions of which are incorporated herein. Each Warrant shall be signed
by, or bear the facsimile signature of, the Chief Executive Officer and either
the President, Vice President of Finance or Secretary of the Company and shall
bear a facsimile of the Company’s seal. If the person whose facsimile signature
has been placed upon any Warrant shall have ceased to serve in the capacity
in
which such person signed the Warrant before such Warrant is issued, it may
be
issued with the same effect as if he or she had not ceased to be such at the
date of issuance.
2.2. Effect
of Countersignature.
Unless
and until countersigned by the Warrant Agent pursuant to this Agreement, a
Warrant shall be invalid and of no effect and may not be exercised by the holder
thereof. Such signature by the Warrant Agent upon any Warrant executed by the
Company shall be conclusive evidence that such Warrant Certificate has been
duly
issued under the terms of this Agreement.
2.3. Registration.
2.3.1 Warrant
Register.
The
Warrant Agent shall maintain books (the “Warrant
Register”)
for
the registration of original issuance and the transfer of Warrants. Upon the
initial issuance of Warrants, the Warrant Agent shall issue and register such
Warrants in the names of holders, in such denominations and otherwise in
accordance with instructions delivered to the Warrant Agent by the
Company.
2.3.2 Registered
Holder.
Prior
to due presentment for registration of transfer of any Warrant, the Company
and
the Warrant Agent may deem and treat the person in whose name such Warrant
shall
be registered upon the Warrant Register (the “registered
holder”)
as the
absolute owner of such Warrant (notwithstanding any notation of ownership or
other writing on such Warrant made by anyone other than the Company or the
Warrant Agent) for the purpose of any exercise thereof and for all other
purposes, and neither the Company nor the Warrant Agent shall be affected by
any
notice to the contrary.
3. Terms
and Exercise of Warrants..
3.1. Warrant
Price.
Each
Warrant shall, when countersigned by the Warrant Agent, entitle the registered
holder thereof, subject to the provisions of such Warrant and of this Agreement,
to purchase from the Company the number of shares of Common Stock stated
therein, at the price of $0.523 per whole share, subject to the adjustments
provided in Section 4 and in the proviso below in this Section 3.1. The term
“Warrant
Price”,
as
used in respect of a Warrant, refers to the price per share at which Common
Stock may be purchased at the time such Warrant is exercised.
3.2. Duration
of Warrants.
A
Warrant may be exercised only during the period (the “Exercise
Period”)
commencing on July 1, 2007, but subject to Section 3.3.3 below regarding an
effective registration statement under the Securities Act of 1933, as amended
(the “Securities
Act”),
and
terminating at 5:00 p.m., New York time, on the earliest to occur of (x)
December 31, 2009, and (y) the date fixed for redemption of Warrants as provided
in Section 6.2 (the “Expiration
Date”).
Except with respect to the right to receive the Redemption Price (as set forth
in Section 6), each Warrant not exercised on or before the Expiration Date
shall
become void, and all rights thereunder and all rights in respect thereof under
this Agreement shall expire.
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3.3. Exercise
of Warrants.
3.3.1 Payment.
Subject
to the provisions of such Warrant and this Agreement, a Warrant, when
countersigned by the Warrant Agent, may be exercised by the registered holder
thereof by surrendering it, at the office of the Warrant Agent, or at the office
of its successor as Warrant Agent, in the Borough of Manhattan, City and State
of New York, with the exercise form, as set forth in the Warrant, duly completed
and executed, and by paying in full, in lawful money of the United States,
in
cash or by certified check payable to the order of the Company (or as otherwise
agreed by the Company), the Warrant Price for each full share of Common Stock
as
to which such Warrant is exercised, the aggregate exercise price for such
Warrant to be rounded up to the next whole cent for such Warrant so exercised
(for example, if a Warrant is exercised for 5 shares of Common Stock, the
aggregate exercise price shall be $2.62, or $0.523 multiplied by 5 shares,
rounded to the next whole cent) and any and all transfer taxes in respect of
such Warrant or shares of Common Stock issuable on exercise thereof.
3.3.2 Issuance
of Certificates.
As soon
as practicable after the exercise of any Warrant and the clearance of the funds
in payment of the Warrant Price in respect thereof, the Company shall issue
or
cause to be issued to the registered holder of such Warrant a certificate or
certificates for the number of full shares of Common Stock to which it is
entitled, registered in such name or names as may be directed by it, and if
such
Warrant shall not have been exercised in full, a new countersigned Warrant
for
the number of shares as to which such Warrant shall not have been exercised.
3.3.3 Delivery
of Securities.
Notwithstanding anything contained herein to the contrary, the Company shall
not
be obligated to deliver any securities pursuant to the exercise of a Warrant
unless a registration statement under the Securities Act with respect to the
issuance of the securities that shall have been issuable upon such exercise
is
effective and, unless issuance of such securities is qualified or exempt from
qualification under applicable securities laws of the states or other
jurisdictions in which the registered holder of such Warrant resides. If such
registration statement is not effective or the issuance of such securities
is
not exempt as described in the preceding sentence, the registered holder of
such
Warrant will not be entitled to exercise such Warrant and such Warrant may
have
no value and expire worthless.
3.3.4 No
Net-Cash Settlement.
Notwithstanding anything contained herein to the contrary, in no event shall
the
Company be liable for, or shall any registered holder of a Warrant be entitled
to receive, (a) any net-cash settlement or other consideration in lieu of
physical settlement in securities or (b) unless the conditions and requirements
set forth in Sections 3.3.3 and 7.4 shall have been satisfied, physical
settlement in securities upon exercise of any Warrant due to the inability
to
exercise any Warrant, or otherwise.
3.3.5 Valid
Issuance.
All
shares of Common Stock issued upon the proper exercise of a Warrant in
conformity with this Agreement shall be validly issued, fully paid and
non-assessable.
3.3.6 Date
of Issuance.
Each
person in whose name any such certificate for shares of Common Stock is issued
shall for all purposes be deemed to have become the holder of record of such
shares on the date on which the Warrant was duly surrendered and payment of
the
Warrant Price was duly made, irrespective of the date of delivery of such
certificate, except that, if the date of such surrender and payment is a date
when the stock transfer books of the Company are closed, such person shall
be
deemed to have become the holder of record of such shares at the close of
business on the next succeeding date on which the stock transfer books are
open.
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4. Adjustments..
4.1. Adjustment
of Exercise Rate and Exercise Price.
The
number of shares of Common Stock purchasable upon the exercise of each Warrant
(the “Exercise
Rate”),
and
the Exercise Price, are subject to adjustment from time to time upon the
occurrence of the events enumerated in this Section 4. The Exercise Rate shall
initially be 1 to 1.
4.1.1 Adjustment
for Change in Common Stock.
If,
after the date hereof, the Company:
(a) pays
a
dividend or makes a distribution on shares of its Common Stock payable in shares
of its Common Stock;
(b) subdivides
or splits any of its outstanding shares of Common Stock into a greater number
of
shares; or
(c) combines
any of its outstanding shares of Common Stock into a smaller number of
shares,
then
the
Exercise Rate in effect immediately prior to such action for each Warrant then
outstanding shall be adjusted by multiplying the Exercise Rate in effect
immediately prior to such action by a fraction (A) the numerator of which shall
be the number of shares of Common Stock outstanding immediately after such
action and (B) the denominator of which shall be the number of shares of Common
Stock outstanding immediately prior to such action or the record date applicable
to such action, if any (regardless of whether the Warrants then outstanding
are
then exercisable); and the Exercise Price for each Warrant shall be adjusted
to
a number determined by dividing the Exercise Price immediately prior to such
event by such fraction. The $1.046 per
share
contained in Section 6.1 shall also be adjusted to a number determined by
dividing the Exercise Price immediately prior to such event by such fraction.
The adjustment shall become effective immediately after the record date in
the
case of a dividend or distribution and immediately after the effective date
in
the case of a subdivision, combination or reclassification. If such dividend
or
distribution is not so paid or made or such subdivision, combination or
reclassification is not effected, the Exercise Rate and Exercise Price shall
again be adjusted to be the Exercise Rate and Exercise Price which would then
be
in effect if such record date or effective date had not been so fixed.
4.2. Replacement
of Securities upon Reorganization, Etc.
In case
of any reclassification (including, without limitation, a reclassification
effected by means of an exchange or tender offer by the Company) or
reorganization of the outstanding shares of Common Stock (other than a change
that solely affects the par value of the Common Stock or as a result of a
subdivision or combination covered by Section 4.1), or in the case of any merger
or consolidation of the Company with or into another entity (other than a
consolidation or merger in which the Company is the continuing corporation
and
that does not result in any reclassification or reorganization of the
outstanding shares of Common Stock), or in the case of any sale or conveyance
to
another corporation or entity of the assets or other property of the Company
as
an entirety or substantially as an entirety in connection with which the Company
is dissolved (each, a “Reorganization
Event”),
each
registered holder shall have the right thereafter (until the expiration of
the
right to exercise his Warrant) to receive, in lieu of the shares of Common
Stock
immediately theretofore receivable upon the exercise of his Warrant, the kind
and amount of shares of Common Stock and/or other securities and/or property
(including cash) receivable upon such Reorganization Event that such registered
holder would have received if he had exercised his Warrant immediately prior
to
such Reorganization Event. The provisions of this Section 4.2 shall similarly
apply to successive Reorganization Events. In case of any Reorganization Event
that is a consolidation or merger, the corporation formed by such consolidation
or merger shall execute and deliver a supplemental Warrant Agreement
acknowledging the provisions of this Section 4.2 and providing for adjustments
that shall be as identical as practicable to the adjustments provided in this
Section 4.
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4.3. Certificate
of Adjustment.
After
each adjustment of the Exercise Rate or the Exercise Price, the Company will
promptly prepare a certificate signed by the Chief Executive Officer, President,
Chief Financial Officer, Treasurer or Secretary of the Company setting forth:
(a) the Exercise Rate and Exercise Price, as so adjusted; (b) the amount of
shares of Common Stock purchasable upon exercise of each Warrant after such
adjustment; and (c) a brief statement of the facts accounting for such
adjustment. Such certificate shall be conclusive evidence that the adjustment
is
correct, absent manifest error and the Warrant Agent may rely conclusively
on
anything contained in this certificate. The Company will promptly cause a brief
summary thereof to be filed with the Warrant Agent and either the Company or
the
Warrant Agent will send such summary by ordinary first class mail to each
registered holder at such registered holder’s last address as it shall appear on
the registry books of the Company, but the failure to give such notice (or
any
defect therein) shall not affect the legality or validity of such event.
4.4. No
Fractional Shares.
Notwithstanding any provision contained in this Agreement to the contrary,
the
Company shall not be required to issue fractional shares upon exercise of
Warrants and shall not be required to issue scrip or pay cash in lieu of any
fractional interests. If, by reason of any adjustment made pursuant to this
Section 4, the registered holder of any Warrant would be entitled, upon the
exercise of such Warrant, to receive a fractional share, the Company shall
issue
the nearest whole number of shares of Common Stock to such registered
holder.
4.5. Changes
in Form.
The
form of Warrant need not be changed because of any adjustment pursuant to this
Section 4, and Warrants issued after such adjustment may state the same Warrant
Price and the same number of shares of Common Stock issuable on exercise thereof
as is stated in the Warrants initially issued pursuant to this Agreement. The
acceptance by a registered holder of the issuance of a new Warrant reflecting
a
required or permissive change shall not be deemed to waive any rights to an
adjustment occurring after the computation thereof. The Company may at any
time
in its sole discretion make any change in the form of Warrant that the Company
may deem appropriate and that does not affect the substance thereof, and any
Warrant thereafter issued or countersigned, whether in exchange or substitution
for an outstanding Warrant, or otherwise, may be issued or countersigned in
the
form as so changed.
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5. Transfer
and Exchange of Warrants..
5.1. Registration
of Transfer.
The
Warrant Agent shall register the transfer, from time to time, of any outstanding
Warrant, upon the Warrant Register, upon surrender of such Warrant for transfer,
properly endorsed with signatures properly guaranteed and accompanied by
appropriate instructions for transfer in substantially in the form attached
to
the relevant Warrant Certificate, provided,
however,
that
the Warrant Agent shall not register the transfer of any outstanding Warrant
held by an affiliate (as defined under the Securities Act) until the Warrant
Agent has received an opinion of counsel for the Company stating that such
transfer may be made. From time to time, the Company shall deliver to the
Warrant Agent a list of directors and executive officers of the Company and,
to
the extent known, a list of other affiliates of the Company. Any registered
holder desiring to exchange or transfer a Warrant Certificate shall deliver
a
written request to the Warrant Agent at its principal office, which is currently
located at the address listed in Section 9.2 hereof. When Warrant Certificates
are presented to the Warrant Agent with a written request (a) to register the
transfer of the Warrant Certificates or (b) to exchange such Warrants
Certificates for an equal number of Warrant Certificates of other authorized
denominations, the Warrant Agent shall register the transfer or make the
exchange as requested if the Warrant Certificates so presented have been duly
endorsed or accompanied by a written instruction of transfer in form
satisfactory to the Warrant Agent, duly executed by the registered holder or
by
such registered holder’s attorney and if any other requirements of the Warrant
Agent for such transactions are met; provided,
however,
that if
a Warrant surrendered for transfer bears a restrictive legend, the Warrant
Agent
shall not cancel such Warrant and issue new Warrants in exchange therefor until
the Warrant Agent has received an opinion of counsel for the Company stating
that such transfer may be made and indicating whether the new Warrants must
also
bear a restrictive legend.
5.2. Surrender
of Warrant Certificates.
Any
Warrant Certificate surrendered for registration of transfer, exchange, exercise
or repurchase of the Warrants represented thereby, or in connection with a
Conversion, shall, if surrendered to the Company, be delivered to the Warrant
Agent, and all Warrant Certificates surrendered or so delivered to the Warrant
Agent shall be promptly canceled by the Warrant Agent and shall not be reissued
by the Company and, except as provided in this Section 5 in case of a transfer
or exchange or in Section 3 in case of the exercise or repurchase of less than
all the Warrants represented thereby or in case of a mutilated Warrant
Certificate, no Warrant Certificate shall be issued hereunder in lieu thereof.
All cancelled Warrant Certificates held by the Warrant Agent shall be disposed
of by the Warrant Agent in accordance with its customary procedures and
certification of their disposal will be delivered to the Company from time
to
time as the Company may direct in writing.
5.3. Fractional
Warrants.
The
Warrant Agent shall not effect any registration of transfer or exchange which
will result in the issuance of a fraction of a Warrant, except as required
by
the rules of any national securities exchange upon which the Company’s Common
Stock may then be listed.
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5.4. Service
Charges.
No
service charge shall be made for any registration of exchange or transfer of
Warrants.
5.5. Warrant
Execution and Countersignature.
The
Warrant Agent is hereby authorized to countersign and to deliver, in accordance
with the terms of this Agreement, the Warrants required to be issued pursuant
to
the provisions of this Section 5, and the Company, whenever required by the
Warrant Agent, will supply the Warrant Agent with Warrants duly executed on
behalf of the Company for such purpose.
6. Redemption.
6.1. Redemption.
Not
less than all of the outstanding Warrants may be called for redemption, at
the
option of the Company, at any time after November 4, 2007 and prior to their
expiration, at the price of $.01 per Warrant (“Redemption
Price”);
provided,
that
Warrants shall not be called for redemption unless the last sales price of
the
Common Stock shall have been at least $1.046 per share on each of twenty (20)
trading days within the thirty (30) trading day period ending on the third
Business Day prior to the date on which notice of redemption is given. As used
herein, the term “Business
Day”
shall
mean any day, except a Saturday, Sunday or legal holiday on which the banking
institutions in the City of New York are authorized or obligated by law or
executive order to close.
6.2. Date
Fixed for, and Notice of, Redemption.
In the
event the Company shall elect to redeem all of the Warrants, the Company shall
fix a date for the redemption (the “Redemption
Date”).
Notice of redemption shall be mailed by first class mail, postage prepaid,
by
the Company not less than thirty (30) days prior to the date fixed for
redemption to the registered holders of the Warrants at their last addresses
as
they shall appear on the Warrant Register. Any notice mailed in the manner
herein provided shall be conclusively presumed to have been duly given, whether
or not any registered holder shall have received such notice.
6.3. Exercise
After Notice of Redemption.
The
Warrants may be exercised in accordance with Section 3 at any time after notice
of redemption shall have been given by the Company pursuant to Section 6.2
and
prior to 5:00 p.m., New York time, on the Redemption Date. On and after the
Redemption Date, the registered holder of Warrants shall have no further rights
except to receive, upon surrender of such Warrants, the Redemption
Price.
7. Other
Provisions Relating to Rights of Holders of Warrants.
7.1. No
Rights as Stockholder.
A
Warrant does not entitle the registered holder thereof to any of the rights
of a
stockholder of the Company, including, without limitation, the right to receive
dividends or other distributions, to participate in any rights offering, to
vote
or consent, or to receive notice as a stockholder in respect of meetings of
stockholders or election of directors of the Company or any other
matter.
7.2. Lost,
Stolen, Mutilated or Destroyed Warrants.
If any
Warrant is lost, stolen, mutilated or destroyed, the Company and the Warrant
Agent may on such terms as to indemnity or otherwise as they may in their
discretion impose (which shall, in the case of a mutilated Warrant, include
the
surrender thereof), issue a new Warrant of like denomination, tenor and date
as
the Warrant so lost, stolen, mutilated or destroyed. Any such new Warrant shall
constitute a substitute contractual obligation of the Company, whether or not
the allegedly lost, stolen, mutilated or destroyed Warrant shall be at any
time
enforceable by any person.
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7.3. Reservation
of Common Stock.
The
Company shall at all times reserve and keep available a number of its authorized
but unissued shares of Common Stock that will be sufficient to permit the
exercise in full of all outstanding Warrants issued pursuant to this
Agreement.
7.4. Registration
of Common Stock.
The
Company agrees that, prior to the commencement of and during the Exercise
Period, it shall use commercially reasonable efforts to file with the United
States Securities and Exchange Commission (the “Commission”),
a
registration statement or any other filings with the Commission necessary to
cause to become effective and to maintain the effectiveness of the registration
under the Securities Act of the issuance of the Common Stock issuable upon
exercise of the Warrants; provided,
however,
that in
no event shall the Company be liable for, or shall any registered holder of
a
Warrant be entitled to receive, (a) any net-cash settlement or other
consideration in lieu of physical settlement in securities or (b) unless the
conditions and requirements set forth in Section 3.3.3 and this Section 7.4
shall have been satisfied, physical settlement in securities upon exercise
of
any Warrant due to the inability to exercise any Warrant, or otherwise. The
obligations of the Company under the preceding sentence shall terminate upon
the
expiration or redemption of the Warrants in accordance with the provisions
of
this Agreement (or, if the Company completes a going private transaction prior
to such expiration or redemption, at such time as such transaction is
completed).
8. Concerning
the Warrant Agent and Other Matters..
8.1. Payment
of Taxes.
The
Company will from time to time promptly pay all applicable taxes and other
governmental charges that may be imposed upon the Company or the Warrant Agent
due in connection with the exercise of the Warrants and the issuance of the
Common Stock upon the exercise of Warrants, but the Company shall not be
obligated to pay any transfer taxes in respect of Warrants or such
shares.
8.2. Resignation,
Consolidation, or Merger of Warrant Agent.
8.2.1 Resignation
or Removal.
The
Warrant Agent, or any successor to it, may resign its duties and be discharged
from all further duties and liabilities hereunder after giving thirty (30)
days'
notice in writing to the Company, and the Company may remove the Warrant Agent
at any time, without assigning any cause therefor, by delivering to the Warrant
Agent written notice of removal, effective not less than thirty (30) days after
receipt by the Warrant Agent of such notice. If the office of the Warrant Agent
becomes vacant by resignation or removal or otherwise, the Company shall appoint
in writing a successor Warrant Agent in place of the Warrant Agent. If the
Company shall fail to make such appointment within a period of thirty (30)
days
after it has been notified in writing of such vacancy by the Warrant Agent
or by
the registered holder of any Warrant (who shall, with such notice, submit its
Warrant for inspection by the Company), then any holder of any Warrant may
apply
to the Supreme Court of the State of New York for the County of New York for
the
appointment of a successor Warrant Agent at the Company's cost. Any successor
Warrant Agent, whether appointed by the Company or by such court, shall be
a
national banking corporation or a corporation organized and existing under
the
laws of the State of New York, in good standing and having its principal office
in the Borough of Manhattan, City and State of New York, and authorized under
such laws to exercise corporate trust powers and subject to supervision or
examination by federal or state authority.
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8.2.2 Successor
Warrant Agent.
After
appointment, any successor Warrant Agent shall be vested with all the authority,
powers, rights, immunities, duties and obligations of its predecessor Warrant
Agent with like effect as if originally named as Warrant Agent hereunder,
without any further act or deed; but if for any reason it becomes necessary
or
appropriate, the predecessor Warrant Agent shall execute and deliver, at the
expense of the Company, an instrument transferring to such successor Warrant
Agent all the authority, powers, and rights of such predecessor Warrant Agent
hereunder; and upon request of any successor Warrant Agent the Company shall
make, execute, acknowledge and deliver any and all instruments in writing for
more fully and effectually vesting in and confirming to such successor Warrant
Agent all such authority, powers, rights, immunities, duties and obligations.
In
addition, in the event of a resignation or removal, the property held by the
Warrant Agent hereunder shall be duly transferred to the successor Warrant
Agent.
8.2.3 Notice
of Successor Warrant Agent.
In the
event a successor Warrant Agent shall be appointed, the Company shall give
notice thereof to the predecessor Warrant Agent and the transfer agent for
the
Common Stock not later than the effective date of any such
appointment.
8.2.4 Merger
or Consolidation of Warrant Agent.
Any
corporation into which the Warrant Agent may be merged or with which it may
be
consolidated or any corporation resulting from any merger or consolidation
to
which the Warrant Agent shall be a party shall be the successor Warrant Agent
under this Agreement without any further act.
8.3. Fees
and Expenses of Warrant Agent.
8.3.1 Remuneration.
The
Company agrees to pay the Warrant Agent reasonable remuneration for its services
as such Warrant Agent hereunder and will reimburse the Warrant Agent upon demand
for all expenditures that the Warrant Agent may reasonably incur in the
execution of its duties hereunder.
8.3.2 Further
Assurances.
From
time to time on and after the date hereof, the Company agrees to perform,
execute, acknowledge and deliver or cause to be performed, executed,
acknowledged and delivered all such further and other acts, instruments,
documents and assurances as may reasonably be required by the Warrant Agent
for
the carrying out or performing of the provisions and purposes of this Agreement,
to evidence compliance herewith or to assure itself that it is protected in
acting hereunder.
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8.4. Liability
of Warrant Agent
8.4.1 Reliance
on Company Statement.
Whenever in the performance of its duties under this Agreement, the Warrant
Agent shall deem it necessary or desirable that any fact or matter be proved
or
established by the Company prior to taking or suffering any action hereunder,
such fact or matter (unless other evidence in respect thereof be herein
specifically prescribed) may be deemed to be conclusively proved and established
by a statement signed by the Chief Executive Officer, President, Chief Financial
Officer or Chairman of the Board of the Company and delivered to the Warrant
Agent. The Warrant Agent may rely upon such statement for any action taken
or
suffered in good faith by it pursuant to the provisions of this
Agreement.
8.4.2 Indemnity.
The
Warrant Agent shall be liable hereunder only for its own gross negligence,
willful misconduct or bad faith. The Company agrees to indemnify the Warrant
Agent and save it harmless against any and all liabilities, including judgments,
costs and reasonable counsel fees, for anything done or omitted by the Warrant
Agent in the execution of this Agreement except as a result of the Warrant
Agent's gross negligence, willful misconduct or bad faith.
8.4.3 Exclusions.
The
Warrant Agent shall have no responsibility with respect to the validity of
this
Agreement or with respect to the validity or execution of any Warrant (except
its countersignature thereof); nor shall it be responsible for any breach by
the
Company of any covenant or condition contained in this Agreement or in any
Warrant; nor shall it be responsible to make any adjustments required under
the
provisions of Section 4 or responsible for the manner, method or amount of
any
such adjustment or the ascertaining of the existence of facts that would require
any such adjustment; nor shall it by any act hereunder be deemed to make any
representation or warranty as to the authorization or reservation of any shares
of Common Stock to be issued pursuant to this Agreement or any Warrant or as
to
whether any shares of Common Stock will when issued be valid and fully paid
and
non-assessable.
8.5. Acceptance
of Agency.
The
Warrant Agent hereby accepts the agency established by this Agreement and agrees
to perform the same upon the terms and conditions herein set forth and among
other things, shall account promptly to the Company with respect to Warrants
exercised and concurrently account for, and promptly pay to the Company, all
moneys received by the Warrant Agent for the purchase of shares of Common Stock
through the exercise of Warrants.
9. Miscellaneous
Provisions..
9.1. Confidentiality.
9.1.1 Confidential
Information.
Subject
to Section 9.1.3, all information (whether in written, electronic, oral or
other
form and including trade secrets and non-public, confidential or proprietary
information) received by the Warrant Agent or its agents, advisors or other
representatives (individually and collectively, the “Receiving
Party”)
relating to (i) the other Party, its subsidiaries or affiliates or its or their
agents, advisors or other representatives (individually and collectively, a
“Disclosing
Party”),
or
(ii) this Agreement or the transactions contemplated hereby, in each case,
furnished by or on behalf of or obtained from a Disclosing Party, before or
after the date hereof shall be treated as confidential (collectively, the
“Confidential
Information”).
10
9.1.2 Use.
The
Receiving Party (i) will keep all of the Confidential Information confidential
and will not disclose any of the Confidential Information in any manner
whatsoever (except as required by applicable law) without the prior written
consent of the relevant Disclosing Party, and (ii) will not use any of the
Confidential Information in any manner whatsoever other than in connection
with
the consummation of the transactions contemplated hereby; provided,
however,
that
Confidential Information may be revealed to agents, advisors or other
representatives of the Receiving Party who (x) need to know such Confidential
Information for the purpose of consummating such transactions, (y) are informed
in writing by the Receiving Party of the confidential nature and restricted
use
of such Confidential Information and (z) agree to observe the terms of this
Section 9.1 as if they were Parties.
9.1.3 Exclusions.
Confidential Information shall not include information to the extent, but only
to the extent, that such information is (i) on the date hereof part of, or
after
the date hereof becomes part of, the public domain other than as a result of
disclosure by the Receiving Party or any of its agents, advisors or other
representatives where such disclosure constituted or constitutes a breach of
this Section 9.1, (ii) on the date hereof known by the Receiving Party or its
agents, advisors or other representatives so long as such knowledge is
demonstrated by reasonably convincing written (or, if dating is demonstrated
by
reasonably convincing evidence, electronic) evidence, (iii) after the date
hereof becomes known by the Receiving Party on a non-confidential basis from
a
source (other than a Disclosing Party) which, to the knowledge of the Receiving
Party, after due inquiry, is not prohibited from disclosing such information
by
a statutory, regulatory, contractual or fiduciary obligation or (iv) after
the
date hereof developed by the Receiving Party independent of any information
furnished by or on behalf of or obtained from a Disclosing Party so long as
such
independent development is clearly and convincingly demonstrated by dated
written (or, if dating can be independently demonstrated by reasonably
convincing evidence, electronic) records of a type that is customarily generated
and maintained by the Receiving Party in the ordinary course consistent with
past practices.
9.2. Notices.
All
notices and demands required or permitted to be given to a Party pursuant to
this Agreement shall be transmitted by personal delivery, by a nationally
recognized courier service, by registered or certified mail, return receipt
requested, postage prepaid, or by facsimile and shall be addressed as
follows:
When
the
Company is the intended recipient:
DOV
Pharmaceutical, Inc.
000
Xxxxxx Xxxxxx
Xxxxxxxx,
Xxx Xxxxxx 00000
Attention:
Chief Financial Officer
Facsimile:
(000) 000-0000
11
With
a
copy to:
DOV
Pharmaceutical, Inc.
000
Xxxxxx Xxxxxx
Xxxxxxxx,
Xxx Xxxxxx 00000
Attention:
General Counsel
Facsimile:
(000) 000-0000
When
the
Warrant Agent is the intended recipient:
Continental
Stock Transfer & Trust Company
00
Xxxxxxx Xxxxx
Xxx
Xxxx,
XX 00000
Attention:
Compliance Department
Facsimile: (000)
000-0000
A
Party
may designate a new address to which notices required or permitted to be given
pursuant to this Agreement shall thereafter be transmitted by giving written
notice to that effect to the other Party. Each notice transmitted in the manner
described in this Section 9.2 shall be deemed to have been given, received
and
become effective for all purposes at the time it shall have been (a) delivered
to the addressee as indicated by the affidavit of the messenger (if transmitted
by personal delivery), the receipt of the courier service (if transmitted by
courier service), the return receipt (if transmitted by mail) or the answer
back
or call back (if transmitted by facsimile) or (b) presented for delivery to
the
addressee as so indicated during normal business hours, if such delivery shall
have been refused for any reason.
9.3. Governing
Law; Forum; Jury Trial.
THE
VALIDITY, INTERPRETATION, PERFORMANCE AND ENFORCEMENT OF THIS AGREEMENT SHALL
BE
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK. Each Party agrees that any
action, claim or proceeding arising out of this Agreement or the breach or
threatened breach of this Agreement shall be commenced and prosecuted in a
court
in the State of New York. Each Party consents and submits to the non-exclusive
personal jurisdiction of any court in the State of New York in
respect of any such action, claim or proceeding. Each Party consents to service
of process upon it with respect to any such action, claim or proceeding by
registered mail, return receipt requested, and by any other means permitted
by
applicable laws. Each Party waives any objection that it may now or hereafter
have to the laying of venue of any such action, claim or proceeding in any
court
in the State of New York and
any
claim that it may now or hereafter have that any such action, claim or
proceeding in any court in the State of New York has
been
brought in an inconvenient forum. EACH PARTY WAIVES TRIAL BY JURY IN ANY SUCH
ACTION, CLAIM OR PROCEEDING.
9.4. Binding
Effect; Assignment; Third Party Beneficiaries.
This
Agreement shall be binding upon the Parties and their respective successors
and
assigns and shall inure to the benefit of the Parties and their respective
successors and permitted assigns. Except as permitted in Section 8.2, neither
Party shall assign any of its rights or delegate any of its duties under this
Agreement (by operation of law or otherwise) without the prior written consent
of the other Party. Any assignment of rights or delegation of duties under
this
Agreement by a Party without the prior written consent of the other Party,
if
such consent is required hereby, shall be void. No such assignment or delegation
shall relieve the assignor or delegator of its obligations hereunder,
except
that if a Party delegates any of its obligations hereunder with the prior
written consent of the other Party, then it shall be relieved of those
obligations assumed by its delegatee. The Representative (as to Sections 6.1,
7.4 and 9.2), the registered holders and any such transferee shall be deemed
third party beneficiaries of this Agreement. Except as otherwise provided
herein, no other person shall be, or be deemed to be, a third party beneficiary
of this Agreement.
12
9.5. Entire
Agreement.
This
Agreement constitutes the entire agreement between the Parties with respect
to
the subject matter hereof and cancels and supersedes all of the previous or
contemporaneous agreements, representations, warranties and understandings
(whether oral or written) by or between the Parties with respect to the subject
matter hereof.
9.6. Amendments.
No
addition to, and no cancellation, renewal, extension, modification
or amendment of, this Agreement shall be binding upon a Party unless such
addition, cancellation, renewal, extension, modification or amendment is set
forth in a written instrument that states that it adds to, cancels, renews,
extends, modifies
or amends this Agreement and that is executed and delivered on behalf of each
Party by an officer of, or attorney-in-fact for, such Party, or, if a natural
person, by such Party or an attorney-in-fact for such Party, and each such
cancellation, renewal, extension, modification or amendment shall be subject
to
the prior written consent of the Representative; provided,
that
notwithstanding the foregoing, this Agreement may be amended or supplemented
without consent of the Warrant Agent or the Representative to (x) cure any
ambiguity or omission or to correct or supplement any provision contained herein
that may be defective or inconsistent with any other provision contained herein,
(y) add further covenants, restrictions or conditions of the Company for the
benefit of the Warrant Agent or the registered holders, or (z) make any other
change that is not adverse to the Warrant Agent or the registered holders.
9.7. Waivers.
No
waiver of any provision of this Agreement shall be binding upon a Party, unless
such waiver is expressly set forth in a written instrument that is executed
and
delivered by such Party. Such waiver shall be effective only to the extent
specifically set forth in such written instrument. Neither the exercise (from
time to time and at any time) by a Party of, nor the delay or failure (at any
time or for any period of time) to exercise, any right, power or remedy shall
constitute a waiver of the right to exercise, or impair, limit or restrict
the
exercise of, such right, power or remedy or any other right, power or remedy
at
any time and from time to time thereafter. No waiver of any right, power or
remedy of a Party shall be deemed to be a waiver of any other right, power
or
remedy of such Party or shall, except to the extent so waived, impair, limit
or
restrict the exercise of such right, power or remedy.
9.8. Remedies
Limited.
Neither
Party shall, for any reason or under any legal theory, be liable for any
special, indirect, incidental or consequential damages arising out of any breach
of or default under this Agreement, even if informed of the possibility of
such
damages in advance.
9.9. Headings;
Counterparts; Interpretation.
9.9.1 Headings.
The
headings set forth herein have been inserted for convenience of reference only,
shall not be considered a part of this Agreement and shall not limit, modify
or
affect in any way the meaning or interpretation of this Agreement.
13
9.9.2 Counterparts.
This
Agreement may be signed in any number of counterparts, each of which (when
executed and delivered) shall constitute an original instrument, but all of
which together shall constitute one and the same instrument. This Agreement
shall become effective and be deemed to have been executed and delivered by
all
of the Parties at such time as counterparts shall have been executed and
delivered by each of the Parties, regardless of whether each of the Parties
has
executed the same counterpart. It shall not be necessary when making proof
of
this Agreement to account for any counterparts other than a sufficient number
of
counterparts which, when taken together, contain signatures of all of the
Parties. Delivery of a counterpart by facsimile shall be as effective as
delivery of an original.
9.9.3 Interpretation.
Each of
the Parties has participated substantially in the negotiation and drafting
of
this Agreement and no ambiguity herein shall be construed against the draftsman.
9.10. Severability.
If any
provision of this Agreement shall hereafter be held to be invalid, unenforceable
or illegal, in whole or in part, in any jurisdiction under any circumstances
for
any reason, (a) such provision shall be reformed to the minimum extent necessary
to cause such provision to be valid, enforceable and legal while preserving
the
intent of the Parties as expressed in, and the benefits to the Parties provided
by, this Agreement or (b) if such provision cannot be so reformed, such
provision shall be severed from this Agreement and an equitable adjustment
shall
be made to this Agreement (including addition of necessary further provisions
to
this Agreement) so as to give effect to the intent so expressed and the benefits
so provided. Such holding shall not affect or impair the validity,
enforceability or legality of such provision in any other jurisdiction or under
any other circumstances. Neither such holding nor such reformation nor severance
shall affect or impair the legality, validity or enforceability of any other
provision of this Agreement.
9.11. Examination.
A copy
of this Agreement shall be available at all reasonable times at the office
of
the Warrant Agent for inspection by the registered holder of any Warrant. The
Warrant Agent may require any such registered holder to submit its Warrant
for
inspection by it.
[remainder
of page intentionally left blank]
14
IN
WITNESS WHEREOF,
the
Parties have executed and delivered this Agreement as of the date first above
written.
| DOV PHARMACEUTICAL, INC. | ||
| |
|
|
| By: | /s/ Xxxxxxx Xxxxxx | |
|
Name:
Xxxxxxx
Xxxxxx
|
||
|
Title:
Chief
Executive Officer
|
||
|
CONTINENTAL
STOCK TRANSFER & TRUST
COMPANY
|
||
| |
|
|
| Date: | By: | /s/ Xxxxx Xxxxxxxxxx |
|
Name:
Xxxxx Xxxxxxxxxx
|
||
|
Title:
Vice President
|
||
15
Exhibit
A
[SPECIMEN
WARRANT CERTIFICATE]
|
NUMBER
W______
|
WARRANTS
|
(THIS
WARRANT WILL BE VOID IF NOT EXERCISED PRIOR TO 5:00 P.M.
NEW
YORK
TIME, DECEMBER 31, 2009)
DOV
PHARMACEUTICAL, INC.
CUSIP
WARRANT
THIS
CERTIFIES THAT, for value received ,_____________________, is the registered
holder (the “holder”)
of
________________ Warrants, expiring at 5:00 p.m. New York time on December
31,
2009 and entitling the holder, upon exercise after the date specified in the
immediately succeeding paragraph, to purchase one fully paid and non-assessable
share of common stock, par value $0.0001 per share (the “Shares”),
of
DOV PHARMACEUTICAL, INC., a Delaware corporation (the “Company”),
for
each Warrant evidenced by this Warrant Certificate, at the price of $0.523
per
Share (the “Warrant
Price”),
upon
surrender of this Warrant Certificate and payment of the Warrant Price at the
office of the Warrant Agent identified below in accordance with the Warrant
Agreement (as defined below; capitalized terms used without definition in this
Warrant Certificate shall have the meanings given to them in the Warrant
Agreement).
Each
Warrant shall become exercisable on July 1, 2007, but subject to the third
paragraph below regarding an effective registration statement under the
Securities Act of 1933, as amended (the “Securities
Act”).
The
Warrant Agreement provides that, upon the occurrence of certain events, the
Warrant Price and the number of Shares purchasable upon exercise of a Warrant,
may, subject to certain conditions, be adjusted.
This
Warrant Certificate and the Warrants evidenced hereby have been issued pursuant
to the Warrant Agreement dated May 10, 2007 between the Company and Continental
Stock Transfer & Trust Company, as Warrant Agent (the “Warrant
Agreement”).
Notwithstanding anything contained herein to the contrary, this Warrant
Certificate and the Warrants evidenced hereby shall be governed by and be
subject to the conditions, limitations and provisions set forth in the Warrant
Agreement.
Prior
to
the commencement of and during the Exercise Period, the Company must use
commercially reasonable efforts to file with the Commission, a registration
statement or any other filings with the Commission necessary to cause to become
effective and to maintain the effectiveness of the registration under the
Securities Act of the issuance of the Common Stock issuable upon exercise of
any
Warrant evidenced by this Warrant Certificate, which obligations will terminate
upon the expiration or redemption thereof in accordance with the provisions
of
the Warrant Agreement (or, if the Company completes a going private transaction
prior to such expiration or redemption, at such time as such transaction is
completed).
The
Company shall not be obligated to deliver any securities pursuant to the
exercise of any Warrant evidenced by this Warrant Certificate unless a
registration statement under the Securities Act with respect to the issuance
of
the securities that shall have been issuable upon such exercise is effective
and
unless issuance of such securities is qualified or exempt from qualification
under applicable securities laws of the states or other jurisdictions in which
the registered holder of the Warrant evidenced by this Warrant Certificate
resides. If such registration statement is not effective or the issuance of
such
securities is not exempt as described in the preceding sentence, the registered
holder of such Warrant will not be entitled to exercise such Warrant and such
Warrant may have no value and expire worthless. In no event shall the Company
be
liable for, nor shall any registered holder of Warrants be entitled to receive,
(a) any net-cash settlement or other consideration in lieu of physical
settlement in securities or (b) unless the conditions and requirements set
forth
in Sections 3.3.3 and 7.4 of the Warrant Agreement shall have been satisfied,
physical settlement in securities upon exercise of any Warrant due to the
inability to exercise any Warrant, or otherwise. Except with respect to the
right to receive the Redemption Price (as set forth in Section 6 of the Warrant
Agreement), each Warrant not exercised on or before the Expiration Date will
become void, and all rights thereunder and all rights in respect thereof under
the Warrant Agreement will expire.
No
fraction of a Share will be issued upon any exercise of a Warrant. If, upon
exercise of a Warrant, the holder would be entitled to receive a fractional
Share, the Company will, upon exercise, issue that number of Shares obtained
by
rounding such fractional share to the nearest whole number.
Upon
exercise of less than the total number of Warrants evidenced by this Warrant
Certificate, the Warrant Agent shall issue to the holder a new Warrant
Certificate of like tenor and evidencing the number of Warrants not so
exercised.
Upon
due
presentment for exchange or transfer of this Warrant Certificate at the office
of the Warrant Agent, a new Warrant Certificate or Warrant Certificates of
like
tenor and evidencing in the aggregate a like number of Warrants shall be issued
to the holder or transferee, as applicable, subject to the limitations set
forth
in the Warrant Agreement, without charge except for any applicable transfer
tax.
The
Company and the Warrant Agent may deem and treat the registered holder as the
absolute owner of this Warrant Certificate and the Warrants evidenced hereby
(notwithstanding any notation of ownership or other writing hereon made by
anyone other than the Company or the Warrant Agent), for the purpose of any
exercise hereof and for all other purposes, and neither the Company nor the
Warrant Agent shall be affected by any notice to the contrary.
Neither
this Warrant Certificate nor any of the Warrants evidenced hereby entitle the
holder to any of the rights of a stockholder of the Company.
THE
COMPANY MAY REDEEM THE WARRANTS, IN WHOLE AND NOT IN PART, AT A PRICE OF $.01
PER WARRANT AT ANY TIME AFTER NOVEMBER 4, 2007, BY GIVING 30 DAYS’ PRIOR WRITTEN
NOTICE OF REDEMPTION, IF, AND ONLY IF, THE LAST SALES PRICE OF THE COMMON STOCK
HAS BEEN AT LEAST $1.046 PER SHARE (THE “REDEMPTION PRICE”), ON EACH OF TWENTY
(20) TRADING DAYS WITHIN THE THIRTY (30) TRADING DAY PERIOD ENDING ON THE THIRD
BUSINESS DAY PRIOR TO THE DATE ON WHICH NOTICE OF REDEMPTION IS GIVEN. THE
RIGHT
TO EXERCISE THE WARRANTS WILL BE FORFEITED UNLESS THEY ARE EXERCISED BEFORE
THE
DATE SPECIFIED IN THE NOTICE OF REDEMPTION. ON AND AFTER THE REDEMPTION DATE,
THE RECORD HOLDER OF A WARRANT WILL HAVE NO FURTHER RIGHTS EXCEPT TO RECEIVE,
UPON SURRENDER OF THE WARRANTS, THE REDEMPTION PRICE. THE WARRANT AGREEMENT
PROVIDES THAT, UPON THE OCCURRENCE OF CERTAIN EVENTS, THE $1.046 MINIMUM LAST
SALES PRICE AT WHICH THE WARRANTS BECOME SUBJECT TO REDEMPTION, MAY, SUBJECT
TO
CERTAIN CONDITIONS, BE ADJUSTED.
This
certificate is not valid unless countersigned and registered by the Warrant
Agent.
WITNESS
the
facsimile seal of the Corporation and the facsimile signatures of its duly
authorized officers.
|
By:
|
|
By:
|
|
|
|
Chief
Executive Officer
|
President
|
|||
|
CONTINENTAL
STOCK TRANSFER & TRUST
COMPANY
|
||||
|
By:
|
||||
|
Name:
|
||||
| Title: |
The
following abbreviations, when used in the inscription on the face of this
certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
|
TEN
COM
|
-
as tenants in common
|
||
|
TEN
ENT
|
-
as tenants by the entireties
|
||
|
JT
TEN
|
-
as joint tenants with right of survivorship and not as tenants in
common
|
||
|
UNIF
GIFT MIN ACT -
|
as Custodian for | |
|
(Cust)
|
(Minor)
|
|
|
under Uniform Gifts to Minors Act of
|
(state) |
Additional
abbreviations may also be used though not in the above list.
EXERCISE
FORM
To
Be
Executed by the Holder in Order to Exercise Warrants
The
undersigned holder, _______________, hereby irrevocably elects to exercise
______________________ (_________) Warrants evidenced by this Warrant
Certificate, and to purchase the shares of Common Stock issuable upon the
exercise of such Warrants, and requests that certificates for such shares be
issued in the name of and be delivered to
| (PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, AND INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE) | |
| ( ) | |
and,
if
such number of Warrants shall not be all the Warrants evidenced by this Warrant
Certificate, requests that a new Warrant Certificate of like tenor for the
balance of such Warrants be registered in the name of, and delivered to, the
holder at the address stated below.
|
(Signature)
|
NOTICE:
The signature to this form must correspond with the name as written upon the
face of the certificate in every particular, without alteration or enlargement
or any change whatever.
(Dated)
|
(Signature
Guaranteed)
|
THE
SIGNATURE SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP
IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM, PURSUANT TO SEC RULE
17Ad-15).
ASSIGNMENT
FORM
To
Be
Executed by the Holder in Order to Transfer Warrants
For
value
received, the undersigned holder, _________________________________, hereby
sells, assigns and transfers unto
| (PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, AND INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE) | |
| ( ) | |
Warrants
represented by the within Warrant Certificate, and does hereby irrevocably
constitute and appoint
______________________________________
Attorney to transfer the said Warrants on the books of the within-named
Corporation and Warrant Agent with full power of substitution in the
premises.
|
(Signature)
|
NOTICE:
The signature to this form must correspond with the name as written upon
the
face of the certificate in every particular, without alteration or enlargement
or any change whatever.
(Dated)
|
(Signature
Guaranteed)
|
THE
SIGNATURE SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP
IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM, PURSUANT TO SEC RULE
17Ad-15).
