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Exhibit 4.04
Warrant No. ________
Warrant to Purchase __________ Shares
SHARE PURCHASE WARRANT
To Purchase Shares of Common Stock (par value $0.0001)
of
LXR Biotechnology Inc.
(Delaware corporation)
Expires __________ __, 2001
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Warrant No. ________
NEITHER THIS WARRANT NOR THE SHARES ISSUABLE UPON EXERCISE HEREOF MAY BE
TRANSFERRED EXCEPT IN A TRANSACTION REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, OR WHICH IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THAT ACT.
VOID AFTER 5:00 P.M. NEW YORK TIME, ON __________ __, 2001
LXR Biotechnology Inc.
Warrant to Purchase Shares of Common Stock
__________ Shares
THIS CERTIFIES that, for good and valuable consideration received,
_______________________________ (the "Holder"), is entitled to subscribe for and
purchase from LXR Biotechnology Inc., a Delaware corporation (the "Company"),
upon the terms and conditions set forth herein, at any time or from time to time
until 5:00 P.M. New York City time on __________ __, 2001 (the "Expiration
Date"), all or any portion of __________ Shares of common stock of the Company,
par value $0.0001 per share, subject to adjustment as provided herein (the
"Warrant Shares"), at a price of $2.20 per share, subject to adjustment as
provided herein (the "Exercise Price"). This Warrant shall not be redeemable by
the Company. The term "Shares" as used herein shall mean the Company's Shares of
Common Stock, par value $0.0001 per share. This Warrant may be sold,
transferred, assigned or hypothecated at any time and the term the "Holder" as
used herein shall include any transferee to whom this Warrant has been
transferred.
1. Method of Exercise. This Warrant may be exercised at any time
prior to the Expiration Date, as to the whole or any lesser number of Warrant
Shares, by the surrender of this Warrant (with the election at the end hereof
duly executed) to the Company at its office at 0000 Xxxxxx Xxx Xxxxx, Xxxxxxxx,
XX 00000-0000 or at such other place as may be designated in writing by the
Company, together with a certified or bank cashier's check payable to the order
of the Company in an amount equal to the Exercise Price multiplied by the number
of Warrant Shares for which this Warrant is being exercised. In lieu of the
payment of the Exercise Price, the Holder shall have the right (but not the
obligation), during the Exercise Period, to require the Company to convert this
Warrant, in whole or in part, into the Warrant Shares as provided for in this
Section (the "Conversion Right"). Upon exercise of the Conversion Right, the
Company shall deliver to the Holder (without payment by the Holder of the
Exercise Price) that number of shares of Common Stock equal to (i) the number of
Warrant Shares issuable upon exercise of the portion of the Warrant being
converted, multiplied by (ii) the quotient obtained by dividing (x) the value of
the Warrant (on a per Warrant Share basis) at the time the Conversion Right is
exercised (determined by subtracting the Exercise Price from the Current Market
Price (as determined pursuant to Section 5(e) below), for the shares of Common
Stock issuable upon exercise of the Warrant immediately prior to the exercise of
the Conversion Right) by (y) the Current Market Price of one share of Common
Stock immediately
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prior to the exercise of the Conversion Right. The Conversion Rights provided
under this Section may be exercised in whole or in part and at any time and from
time to time while any Warrants remain outstanding. In order to exercise the
Conversion Right, the Holder shall surrender to the Company, at its offices,
this Warrant accompanied by the form of Subscription Agreement duly filled in
and signed and a duly completed Conversion Notice in the form attached hereto.
The presentation and surrender shall be deemed a waiver of the Holder's
obligation to pay all or any portion of the aggregate purchase price payable for
the Warrant Shares being issued upon such exercise of this Warrant. This Warrant
(or so much thereof as shall have been surrendered for conversion) shall be
deemed to have been converted immediately prior to the close of business on the
day of surrender of this Warrant for conversion in accordance with the foregoing
provisions. As promptly as practicable on or after the conversion date, the
Company shall issue and shall deliver to the Holder (i) a certificate or
certificates representing the largest number of whole Warrant Shares which the
Holder shall be entitled as a result of the conversion, and (ii) if such Warrant
is being converted in part only, a new Warrant exercisable for the number of
Warrant Shares equal to the unconverted portion of the Warrant. Upon any
exercise (which term, as used herein, shall include any exercise of the
Conversion Right) of this Warrant, in lieu of any fractional Warrant Shares to
which the Holder shall be entitled, the Company shall pay to the Holder cash in
accordance with the provisions of Section 5(d) hereof.
2. Issuance of Certificates. Upon each exercise of the Holder's
rights to purchase Warrant Shares, the Holder shall, as of the close of business
on such day, be deemed to be the holder of record of the Warrant Shares issuable
upon such exercise, notwithstanding that the transfer books of the Company shall
then be closed or certificates representing such Warrant Shares shall not then
have been actually delivered to the Holder. As soon as practicable after each
such exercise of this Warrant, the Company shall issue and deliver to the Holder
a certificate or certificates for the Warrant Shares issuable upon such
exercise, registered in the name of the Holder or its designee. If this Warrant
should be exercised in part only, upon surrender of this Warrant for
cancellation, the Company shall execute and deliver a new Warrant evidencing the
right of the Holder to purchase the balance of the Warrant Shares (or portions
thereof) subject to purchase hereunder.
3. Recording of Transfer. Any warrants issued upon the transfer
or exercise in part of this Warrant shall be numbered and shall be registered in
an Warrant Register as they are issued. The Company shall be entitled to treat
the registered holder of any Warrant on the Warrant Register as the owner in
fact thereof for all purposes and shall not be bound to recognize any equitable
or other claim to or interest in such Warrant on the part of any other person,
and shall not be liable for any registration or transfer of warrants which are
registered or to be registered in the name of a fiduciary or the nominee of a
fiduciary unless made with the actual knowledge that a fiduciary or nominee is
committing a breach of trust in requesting such registration or transfer, or
with the knowledge of such facts that its participation therein amounts to bad
faith. This Warrant shall be transferable only on the books of the Company upon
delivery thereof duly endorsed by the Holder or by his or its duly authorized
attorney or representative, or accompanied by proper evidence of succession,
assignment or authority to transfer. In all cases of transfer by an attorney,
executor, administrator, guardian or other legal representative, duly
authenticated evidence of his or its authority shall be produced. Upon any
registration of
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transfer, the Company shall deliver a new warrant or warrants to the person
entitled thereto. This Warrant may be exchanged, at the option of the Holder
hereof, for another warrant, or other warrants of different denominations, of
like tenor and representing in the aggregate the right to purchase a like number
of Warrant Shares (or portions thereof), upon surrender to the Company or its
duly authorized agent. Notwithstanding the foregoing, the Company shall have no
obligation to cause this Warrant to be transferred on its books to any person if
counsel to the Company reasonably requests a legal opinion that such transfer
does not violate the provisions of the Securities Act of 1933, as amended (the
"Act"), and the rules and regulations thereunder, unless such opinion is
delivered.
4. Reservation of Shares. The Company shall at all times reserve
and keep available out of its authorized and unissued Shares, solely for the
purpose of providing for the exercise of the warrants, such number of shares of
Shares as shall, from time to time, be sufficient therefor. The Company
covenants that all shares of Shares issuable upon exercise of this Warrant, upon
receipt by the Company of the full payment therefor, shall be validly issued,
fully paid, nonassessable and free of preemptive rights.
5. Exercise Price Adjustments. Subject to the provisions of this
Section 5, the Exercise Price in effect from time to time shall be subject to
adjustment, as follows:
(a) In case the Company shall at any time after the date
hereof (i) declare a dividend or make a distribution on the outstanding Shares
payable in shares of its capital stock or securities convertible into or
exchangeable for capital stock, (ii) subdivide the outstanding Shares, (iii)
combine the outstanding Shares into a smaller number of shares, or (iv) issue
any shares by reclassification of the Shares (other than a change in par value,
or from par value to no par value, or from no par value to par value), then, in
each case, the Exercise Price in effect, and the number of Shares issuable upon
exercise of the warrants outstanding, at the time of the record date for such
dividend or at the effective date of such subdivision, combination or
reclassification, shall be proportionately adjusted so that the holders of the
warrants after such time shall be entitled to receive upon exercise of the
warrant the aggregate number and kind of shares which, if such warrants had been
exercised immediately prior to such time, such holders would have owned upon
such exercise and immediately thereafter been entitled to receive by virtue of
such dividend, subdivision, combination or reclassification. Such adjustment
shall be made successively whenever any event listed above shall occur.
(b) In case the Company shall distribute to all holders
of Shares (including any such distribution made to the stockholders of the
Company in connection with a consolidation or merger in which the Company is the
surviving or continuing corporation) evidences of its indebtedness, cash, or
assets (other than distributions and dividends payable as contemplated by
Section 5(a) above), or rights, options, or warrants to subscribe for or
purchase Shares or securities convertible into or exchangeable for Shares, then,
in each case, the Exercise Price shall be adjusted by multiplying the Exercise
Price in effect immediately prior to the record date for the determination of
stockholders entitled to receive such distribution by a fraction, the numerator
of which shall be the Current Market Price (as determined pursuant to Section
5(e) hereof) per Share on such record date, less the fair market value (as
determined in good faith by the board of directors of the Company, whose
determination shall be conclusive absent manifest
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error) of the portion of the evidences of indebtedness or assets so to be
distributed, or of such rights, options, or warrants or convertible or
exchangeable securities, or the amount of such cash, applicable to one share,
and the denominator of which shall be such Current Market Price per Share. Such
adjustment shall become effective at the close of business on such record date.
(c) Whenever there shall be an adjustment as provided in
this Section 5, the Company shall within 15 days thereafter cause written notice
thereof to be sent by registered mail, postage prepaid, to the Holder, at its
address as it shall appear in the Warrant Register, which notice shall be
accompanied by an officer's certificate setting forth the number of Warrant
Shares issuable hereunder and the exercise price thereof after such adjustment
and setting forth a brief statement of the facts requiring such adjustment and
the computation thereof, which officer's certificate shall be conclusive
evidence of the correctness of any such adjustment absent manifest error.
(d) The Company shall not be required to issue fractions
of Shares or other shares of the Company upon the exercise of this Warrant. If
any fraction of a share would be issuable upon the exercise of this Warrant (or
specified portions thereof), the Company may issue a whole share in lieu of such
fraction or the Company may purchase such fraction for an amount in cash equal
to the same fraction of the Current Market Price of such Shares on the date of
exercise of this Warrant.
(e) The Current Market Price per Share on any date shall
be deemed to be the average of the daily closing prices for the five (5)
consecutive trading days immediately preceding the date in question. The closing
price for each day shall be the last reported sales price regular way or, in
case no such reported sale takes place on such day, the closing bid price
regular way, in either case on the principal national securities exchange on
which the Common Stock is listed or admitted to trading or, if the Common Stock
is not listed or admitted to trading on any national securities exchange, the
highest reported bid price for the Common Stock as furnished by the National
Association of Securities Dealers, Inc. through NASDAQ or a similar organization
if NASDAQ is no longer reporting such information. If on any such date the
Common Stock is not listed or admitted to trading on any national securities
exchange and is not quoted by NASDAQ or any similar organization, the fair value
of a share of Common Stock on such date, as determined in good faith by the
Board of Directors of the Company, whose determination shall be conclusive
absent manifest error, shall be used.
(f) No adjustment in the Exercise Price shall be required
if such adjustment is less than $0.05; provided, however, that any adjustments
which by reason of this Section 5 are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All calculations
under this Section 5 shall be made to the nearest cent or to the nearest
thousandth of a share, as the case may be.
(g) Upon each adjustment of the Exercise Price as a
result of the calculations made in this Section 5, the warrants shall thereafter
evidence the right to purchase, at the adjusted Exercise Price, that number of
Shares (calculated to the nearest hundredth) obtained by dividing (i) the
product obtained by multiplying the number of Shares purchasable upon exercise
of the warrants prior to adjustment of the number of Shares by the Exercise
Price in
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effect prior to adjustment of the Exercise Price by (ii) the Exercise Price in
effect after such adjustment of the Exercise Price.
6. (a) Consolidations and Mergers. In case of any
consolidation with or merger of the Company with or into another corporation
(other than a merger or consolidation in which the Company is the surviving or
continuing corporation and which does not result in any reclassification of the
outstanding Shares or the conversion of such outstanding Shares into shares of
other stock or other securities or property), or in case of any sale, lease or
conveyance to another corporation of the property and assets of any nature of
the Company as an entirety or substantially as an entirety (such actions being
hereinafter collectively referred to as "Reorganizations"), there shall
thereafter be deliverable upon exercise of this Warrant (in lieu of the number
of Shares theretofore deliverable) the kind and amount of shares of stock or
other securities, cash or other property which would otherwise have been
deliverable to a holder of the number of Shares upon the exercise of this
Warrant upon such Reorganization if this Warrant had been exercised in full
immediately prior to such Reorganization. In case of any Reorganization,
appropriate adjustment, as determined in good faith by the Board of Directors of
the Company, shall be made in the application of the provisions herein set forth
with respect to the rights and interests of the Holder so that the provisions
set forth herein shall thereafter be applicable, as nearly as possible, in
relation to any shares or other property thereafter deliverable upon exercise of
this Warrant. Any such adjustment shall be made by and set forth in a
supplemental agreement between the Company, or any successor thereto, and the
Holder and shall for all purposes hereof conclusively be deemed to be an
appropriate adjustment. The Company shall not effect any such Reorganization
unless upon or prior to the consummation thereof the successor corporation, or
if the Company shall be the surviving corporation in any such Reorganization and
is not the issuer of the shares of stock or other securities or property to be
delivered to holders of Shares outstanding at the effective time thereof, then
such issuer, shall assume by written instrument the obligation to deliver to the
Holder such shares of stock, securities, cash or other property as the Holder
shall be entitled to purchase in accordance with the foregoing provisions.
(b) In case of any reclassification or change of the
Shares issuable upon exercise of this Warrant (other than a change in par value
or from no par value to a specified par value, or as a result of a subdivision
or combination, but including any change in the shares into two or more classes
or series of shares), or in case of any consolidation or merger of another
corporation into the Company in which the Company is the continuing corporation
and in which there is a reclassification or change (including a change to the
right to receive cash or other property) of the Shares (other than a change in
par value, or from no par value to a specified par value, or as a result of a
subdivision or combination, but including any change in the shares into two or
more classes or series of shares), the Holder shall have the right thereafter to
receive upon exercise of this Warrant solely the kind and amount of shares of
stock and other securities, property, cash or any combination thereof receivable
upon such reclassification, change, consolidation or merger by a holder of the
number of Shares for which this Warrant might have been exercised immediately
prior to such reclassification, change, consolidation or merger. Thereafter,
appropriate provision shall be made for adjustments which shall be as nearly
equivalent as practicable to the adjustments in Section 5.
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(c) The above provisions of this Section 6 shall
similarly apply to successive reclassifications and changes of Shares and to
successive consolidations, mergers, sales, leases, or conveyances.
7. Notice of Certain Events. In case at any time any of the
following occur:
(a) The Company shall take a record of the holders of its
Shares for the purpose of entitling them to receive a dividend or distribution
payable otherwise than in cash, or a cash dividend or distribution payable
otherwise than out of current or retained earnings, as indicated by the
accounting treatment of such dividend or distribution on the books of the
Company; or
(b) The Company shall offer to all the holders of its
Shares any additional shares of capital stock of the Company or securities
convertible into or exchangeable for shares of capital stock of the Company, or
any option, right or warrant to subscribe therefor; or
(c) The Company shall take any action to effect any
reclassification or change of outstanding Shares or any consolidation, merger,
sale, lease or conveyance of property, described in Section 6; or
(d) The Company shall take any action to effect any
liquidation, dissolution or winding-up of the Company or a sale of all or
substantially all of its property, assets and business;
then, and in any one or more of such cases, the Company shall give written
notice thereof, by registered mail, postage prepaid, to the Holder at the
Holder's address as it shall appear in the Warrant Register, mailed at least
fifteen (15) days prior to (i) the date as of which the holders of record of
Shares to be entitled to receive any such dividend, distribution, rights,
warrants or other securities are to be determined, (ii) the date on which any
such offer to holders of Shares is made, or (iii) the date on which any such
reclassification, change of outstanding Shares, consolidation, merger, sale,
lease, conveyance of property, liquidation, dissolution or winding-up is
expected to become effective and the date as of which it is expected that
holders of record of Shares shall be entitled to exchange their shares for
securities or other property, if any, deliverable upon such reclassification,
change of outstanding shares, consolidation, merger, sale, lease, conveyance of
property, liquidation, dissolution or winding-up. Nothing herein shall allow a
Holder to delay or prevent any of the foregoing actions.
8. Registration Rights. (a) If, at any time during the five-year
period commencing on the date hereof the Company shall file a registration
statement (other than on Form S-4, Form S-8, or any successor form) with the
Securities and Exchange Commission (the "Commission") while any Warrants or
Warrant Shares are outstanding, the Company shall give all of the then holders
of any Warrants (the "Eligible Holders") at least 45 days' prior written notice
of the filing of such registration statement. If requested by any Eligible
Holder in writing within 30 days after receipt of any such notice, the Company
shall, at the Company's sole expense (other than the fees and disbursements of
counsel for the Eligible Holders and the
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underwriting discounts, if any, payable in respect of the Warrant Shares sold by
any Eligible Holder), register or qualify all or, at each Eligible Holder's
option, any portion of the Warrant Shares of any Eligible Holders who shall have
made such request, concurrently with the registration of such other securities,
all to the extent requisite to permit the public offering and sale of the
Warrant Shares through the facilities of all appropriate securities exchanges
and the over-the-counter market, and will use its best efforts through its
officers, directors, auditors, and counsel to cause such registration statement
to become effective as promptly as practicable. Notwithstanding the foregoing,
if the managing underwriter of any such offering shall advise the Company in
writing that, in its opinion, the distribution of all or a portion of the
Warrant Shares requested to be included in the registration concurrently with
the securities being registered by the Company would materially adversely affect
the distribution of such securities by the Company for its own account, then any
Eligible Holder who shall have requested registration of his or its Warrant
Shares shall delay the offering and sale of such securities (or the portions
thereof so designated by such managing underwriter) for such period, not to
exceed 90 days, as the managing underwriter shall request (the "Delay Period");
provided that if any securities of the Company are included in such registration
statement and are eligible for sale during the Delay Period for the account of
any person other than the Company, a pro rata portion of the securities which
were requested to be included and eligible for sale during the Delay Period
shall also be included in such registration statement and shall be eligible for
sale during the Delay Period.
(b) If, on any two occasions during the five-year period
commencing on the date hereof, the Company shall receive a written request from
Eligible Holders who in the aggregate own (or upon exercise of all Warrants then
outstanding would own) a majority of the total number of shares of Common Stock
then included (or upon such exercises would be included) in the Warrant Shares
(the "Majority Holders"), to register the sale of all or part of the Warrant
Shares, the Company shall, as promptly as practicable, prepare and file with the
Commission a registration statement sufficient to permit the public offering and
sale of the Warrant Shares (whether covered by such request from the Majority
Holders or by any other written request from any Eligible Holder received within
30 days after such Eligible Holder's receipt of the Company's notice, as
described in the last sentence of this Section 8(b)) through the facilities of
all appropriate securities exchanges and the over-the-counter market, and will
use its best efforts through its officers, directors, auditors, and counsel to
cause such registration statement to become effective as promptly as
practicable; provided, that the Company shall only be obligated to file one such
registration statement for which all expenses incurred in connection with such
registration (other than the fees and disbursements of counsel for the Eligible
Holders and underwriting discounts, if any, payable in respect of the Warrant
Shares sold by the Eligible Holders) shall be borne by the Company. Within three
business days after receiving any request contemplated by this Section 8(b), the
Company shall give written notice to all the other Eligible Holders, advising
each of them that the Company is proceeding with such registration and offering
to include therein all or any portion of any such other Eligible Holder's
Warrant Shares, provided that the Company receives a written request to do so
from such Eligible Holder within 30 days after receipt by him or it of the
Company's notice.
(c) Notwithstanding anything herein to the contrary, in
addition to the registration rights under Sections 8(a) and 8(b) above, the
Eligible Holder shall be entitled to the same registration rights and rights
included therein as the purchasers of securities of the
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Company are entitled to pursuant to the Subscription Agreement, dated as of the
date hereof, among the purchasers described therein and the Company as to the
Warrant Shares.
(d) In the event of a registration pursuant to the
provisions of this Section 8, the Company shall use its best efforts to cause
the Warrant Shares so registered to be registered or qualified for sale under
the securities or blue sky laws of such jurisdictions as the Holder or such
holders may reasonably request; provided, however, that the Company shall not be
required to qualify to do business in any state by reason of this Section 8(d)
in which it is not otherwise required to qualify to do business or otherwise
subject itself to general service of process in any such state.
(e) The Company shall keep effective any registration or
qualification contemplated by this Section 8(a) or (b) and shall from time to
time amend or supplement each applicable registration statement, preliminary
prospectus, final prospectus, application, document and communication for such
period of time as shall be required to permit the Eligible Holders to complete
the offer and sale of the Warrant Shares covered thereby. The Company shall in
no event be required to keep any such registration or qualification in effect
for a period in excess of six months from the date on which the Eligible Holders
are first free to sell such Warrant Shares; provided, however, that, if the
Company is required to keep any such registration or qualification in effect
with respect to securities other than the Warrant Shares beyond such period, the
Company shall keep such registration or qualification in effect as it relates to
the Warrant Shares for so long as such registration or qualification remains or
is required to remain in effect in respect of such other securities.
(f) In the event of a registration pursuant to the
provisions of this Section 8, the Company shall furnish to each Eligible Holder
such number of copies of the registration statement and of each amendment and
supplement thereto (in each case, including all exhibits), such reasonable
number of copies of each prospectus contained in such registration statement and
each supplement or amendment thereto (including each preliminary prospectus),
all of which shall conform to the requirements of the Act and the rules and
regulations thereunder, and such other documents, as any Eligible Holder may
reasonably request to facilitate the disposition of the Warrant Shares included
in such registration.
(g) In the event of a registration pursuant to the
provisions of this Section 8, the Company shall furnish each Eligible Holder of
any Warrant Shares so registered with an opinion of its counsel (reasonably
acceptable to the Eligible Holders) to the effect that (i) the registration
statement has become effective under the Act and no order suspending the
effectiveness of the registration statement, preventing or suspending the use of
the registration statement, any preliminary prospectus, any final prospectus or
any amendment or supplement thereto has been issued, nor has the Commission or
any securities or blue sky authority of any jurisdiction instituted or
threatened to institute any proceedings with respect to such an order, (ii) the
registration statement and each prospectus forming a part thereof (including
each preliminary prospectus), and any amendment or supplement thereto, complies
as to form with the Act and the rules and regulations thereunder, and (iii) such
counsel has no knowledge of any material misstatement or omission in such
registration statement or any prospectus, as amended or supplemented.
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(h) In the event of a registration pursuant to the
provision of this Section 8, the Company shall enter into a cross-indemnity
agreement and a contribution agreement, each in customary form, with each
underwriter, if any, and, if requested, enter into an underwriting agreement
containing conventional representations, warranties, allocation of expenses and
customary closing conditions, including, without limitation, opinions of counsel
and accountants' cold comfort letters, with any underwriter who acquires any
Warrant Shares.
(i) The Company agrees that until all the Warrant Shares
have been sold under a registration statement or pursuant to Rule 144 under the
Act, it shall, so long as it is so required by applicable law, timely file all
reports, statements and other materials required to be filed with the Commission
to permit holders of the Warrant Shares to sell such securities under Rule 144,
for a period of up to five years from the date hereof.
(j) Until such time as the Warrant Shares shall become
fully transferable under Rule 144 under the Act, the Company will not, without
the written consent of the Majority Holders, grant to any persons the right to
request the Company to register any securities of the Company, provided that the
Company may grant such registration rights to other persons so long as such
rights do not conflict with the rights of the Eligible Holders; provided,
however, that pro rata rights resulting from "underwriter cutbacks" shall be
deemed not to conflict with the rights of Eligible Holders.
(k) The Company may delay any requested registration
hereunder if the Company's Board of Directors determines in good faith that a
registration at such time would be materially detrimental to the Company
provided that any such delay shall not exceed 30 days and Company cannot provide
this notice more than twice in any 12 month period.
(l) The Company shall not be obligated to register any
shares that may be freely sold under Rule 144 or otherwise in a 91 day period,
nor to initiate a demand registration for less than $250,000 of Warrant Shares.
(m) Subject to the conditions set forth below, the
Company agrees to indemnify and hold harmless each Eligible Holder, its
officers, directors, partners, employees, agents and counsel, and each person,
if any, who controls any such person within the meaning of Section 15 of the Act
or Section 20(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), from and against any and all loss, liability, charge, claim,
damage and expense whatsoever (which shall include, for all purposes of this
Section 8, without limitation, reasonable attorneys' fees and any and all
expense whatsoever incurred in investigating, preparing or defending against any
litigation, commenced or threatened, or any claim whatsoever, and any and all
amounts paid in settlement of any claim or litigation), as and when incurred,
arising out of, based upon, or in connection with (i) any untrue statement or
alleged untrue statement of a material fact contained (A) in any registration
statement, preliminary prospectus or final prospectus (as from time to time
amended and supplemented), or any amendment or supplement thereto, relating to
the sale of any of the Warrant Shares, or (B) in any application or other
document or communication (in this Section 8 collectively called an
"application") executed by or on behalf of the Company or based upon written
information furnished by or on behalf of the
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Company filed in any jurisdiction in order to register or qualify any of the
Warrant Shares under the securities or blue sky laws thereof or filed with the
Commission or any securities exchange; or any omission or alleged omission to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, unless such statement or omission was made in
reliance upon and in conformity with written information furnished to the
Company with respect to such Eligible Holder by or on behalf of such person
expressly for inclusion in any registration statement, preliminary prospectus,
or final prospectus, or any amendment or supplement thereto, or in any
application, as the case may be, or (ii) any breach of any representation,
warranty, covenant or agreement of the Company contained in this Warrant. The
foregoing agreement to indemnify shall be in addition to any liability the
Company may otherwise have, including liabilities arising under this Warrant.
If any action is brought against any Eligible Holder or any of its
officers, directors, partners, employees, agents or counsel, or any controlling
persons of such person (an "indemnified party") in respect of which indemnity
may be sought against the Company pursuant to the foregoing paragraph, such
indemnified party or parties shall promptly notify the Company in writing of the
institution of such action (but the failure so to notify shall not relieve the
Company from any liability other than pursuant to this Section 8(m) and shall
not relieve the Company from any liability pursuant to this Section 8(m) except
to the extent the Company has been prejudiced in any material respect by such
failure) and the Company shall promptly assume the defense of such action,
including the employment of counsel (reasonably satisfactory to such indemnified
party or parties) and payment of expenses. Such indemnified party or parties
shall have the right to employ its or their own counsel in any such case, but
the fees and expenses of such counsel shall be at the expense of such
indemnified party or parties unless the employment of such counsel shall have
been authorized in writing by the Company in connection with the defense of such
action or the Company shall not have promptly employed counsel reasonably
satisfactory to such indemnified party or parties to have charge of the defense
of such action or such indemnified party or parties shall have reasonably
concluded that there may be one or more legal defenses available to it or them
or to other indemnified parties which are different from or additional to those
available to the Company, in any of which events such fees and expenses of one
counsel shall be borne by the Company, and the Company shall not have the right
to direct the defense of such action on behalf of the indemnified party or
parties. Anything in this Section 8 to the contrary notwithstanding, the Company
shall not be liable for any settlement of any such claim or action effected
without its written consent, which shall not be unreasonably withheld. The
Company shall not, without the prior written consent (which shall not be
unreasonably withheld) of each indemnified party that is not released as
described in this sentence, settle or compromise any action, or permit a default
or consent to the entry of judgment in or otherwise seek to terminate any
pending or threatened action, in respect of which indemnity may be sought
hereunder (whether or not any indemnified party is a party thereto), unless such
settlement, compromise, consent or termination includes an unconditional release
of each indemnified party from all liability in respect of such action. The
Company agrees promptly to notify the Eligible Holders of the commencement of
any litigation or proceedings against the Company or any of its officers or
directors in connection with the sale of any Warrant Shares or any preliminary
prospectus, prospectus, registration statement or amendment or supplement
thereto, or any application relating to any sale of any Warrant Shares.
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(n) Each of the Holder and any Eligible Holder agrees to
indemnify and hold harmless the Company, each director of the Company, each
officer of the Company who shall have signed any registration statement covering
Warrant Shares held by the Holder and any Eligible Holder, each other person, if
any, who controls the Company within the meaning of Section 15 of the Act or
Section 20(a) of the Exchange Act, and its or their respective counsel, to the
same extent as the foregoing indemnity from the Company to the Holder in Section
8(m), but only with respect to statements or omissions, if any, made in any
registration statement or final prospectus, or any amendment or supplement
thereto, or in any application, in reliance upon and in conformity with written
information furnished to the Company with respect to the Holder by or on behalf
of the Holder or with respect to any Eligible Holder or by or on behalf of such
Eligible Holder expressly for inclusion in any such registration statement or
final prospectus, or any amendment or supplement thereto, or in any application,
as the case may be; provided, however, that the Holder and each Eligible Holder
shall be liable only for written information furnished to the Company by it or
on its own behalf for inclusion in a registration statement; and provided,
further, that no Eligible Holder shall be liable in an amount greater than the
net proceeds received by such Eligible Holder in connection with the applicable
registration. If any action shall be brought against the Company or any other
person so indemnified based on any such registration statement or final
prospectus, or any amendment or supplement thereto, or in any application, and
in respect of which indemnity may be sought against the Holder pursuant to this
Section 8(n), the Holder and each Eligible Holder, as the case may be, shall
have the rights and duties given to the Company, and the Company and each other
person so indemnified shall have the rights and duties given to the indemnified
parties, by the provisions of Section 8(m).
(o) To provide for just and equitable contribution, if
(i) an indemnified party makes a claim for indemnification pursuant to Section
8(m) or 8(n) (subject to the limitations thereof) but it is found in a final
judicial determination, not subject to further appeal, that such indemnification
may not be enforced in such case, even though this Agreement expressly provides
for indemnification in such case, or (ii) any indemnified or indemnifying party
seeks contribution under the Act, the Exchange Act or otherwise, then the
Company (including for this purpose any contribution made by or on behalf of any
director of the Company, any officer of the Company who signed any such
registration statement, any controlling person of the Company, and its or their
respective counsel), as one entity, and the Eligible Holders of the Warrant
Shares included in such registration in the aggregate (including for this
purpose any contribution made by or on behalf of an indemnified party), as a
second entity, shall contribute to the losses, liabilities, claims, damages and
expenses whatsoever to which any of them may be subject, on the basis of
relevant equitable considerations such as the relative fault of the Company and
such Eligible Holders in connection with the facts which resulted in such
losses, liabilities, claims, damages and expenses. The relative fault, in the
case of an untrue statement, alleged untrue statement, omission or alleged
omission, shall be determined by, among other things, whether such statement,
alleged statement, omission or alleged omission relates to information supplied
by the Company or by such Eligible Holders, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement, alleged statement, omission or alleged omission. The Company and the
Holder agree that it would be unjust and inequitable if the respective
obligations of the Company and the Eligible Holders for contribution were
determined by pro rata or per capita allocation of the aggregate losses,
liabilities, claims, damages and expenses (even if the Holder and the other
indemnified parties
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were treated as one entity for such purpose) or by any other method of
allocation that does not reflect the equitable considerations referred to in
this Section 8(o). In no case shall any Eligible Holder be responsible for a
portion of the contribution obligation imposed on all Eligible Holders in excess
of its pro rata share based on the number of shares of Common Stock owned (or
which would be owned upon exercise of all Warrants) by it and included in such
registration as compared to the number of shares of Common Stock owned (or which
would be owned upon exercise of all Warrants) by all Eligible Holders and
included in such registration nor shall any Eligible Holder be responsible for
an amount greater than the net proceeds received by such Eligible Holder in
connection with the applicable registration. No person guilty of a fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who is not guilty of such fraudulent
misrepresentation. For purposes of this Section 8(o), each person, if any, who
controls any Eligible Holder within the meaning of Section 15 of the Act or
Section 20(a) of the Exchange Act and each officer, director, partner, employee,
agent and counsel of each such Eligible Holder or control person shall have the
same rights to contribution as such Eligible Holder or control person and each
person, if any, who controls the Company within the meaning of Section 15 of the
Act or Section 20(a) of the Exchange Act, each officer of the Company who shall
have signed any such registration statement, each director of the Company and
its or their respective counsel shall have the same rights to contribution as
the Company, subject in each case to the provisions of this Section 8(o).
Anything in this Section 8(o) to the contrary notwithstanding, no party shall be
liable for contribution with respect to the settlement of any claim or action
effected without its written consent. This Section 8(o) is intended to supersede
any right to contribution under the Act, the Exchange Act or otherwise.
9. Taxes. The issuance of any shares or other securities upon the
exercise of this Warrant and the delivery of certificates or other instruments
representing such shares or other securities shall be made without charge to the
Holder for any tax or other charge in respect of such issuance. The Company
shall not, however, be required to pay any tax which may be payable in respect
of any transfer involved in the issue and delivery of any certificate in a name
other than that of the Holder (except for any tax that is payable in respect of
any such transfer and any related exercise of this Warrant and that would be
payable pursuant to the first sentence of this Section 9 were such certificate
to be issued in the name of the Holder) and the Company shall not be required to
issue or deliver any such certificate unless and until the person or persons
requesting the issue thereof shall have paid to the Company the amount of such
tax or shall have established to the satisfaction of the Company that such tax
has been paid.
10. Legend. Unless registered pursuant to the provisions of
Section 8 hereof, the certificate or certificates evidencing the Warrant Shares,
shall bear the following legend:
"THE SECURITIES REPRESENTED BY THIS
CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"),
OR STATE SECURITIES LAWS, BUT HAVE BEEN ISSUED
OR TRANSFERRED PURSUANT TO AN EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THE ACT. NO
DISTRIBUTION,
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SALE, OFFER FOR SALE, TRANSFER, DELIVERY,
PLEDGE, OR OTHER DISPOSITION OF THESE
SECURITIES MAY BE EFFECTED EXCEPT IN COMPLIANCE
WITH THE ACT, ANY APPLICABLE STATE LAWS, AND
THE RULES AND REGULATIONS OF THE SECURITIES AND
EXCHANGE COMMISSION AND STATE AGENCIES
PROMULGATED THEREUNDER."
In addition, if, after the Warrant Shares are registered pursuant to Section
8(c) hereof, the Holder wishes to have the original legend removed, then, unless
the Warrant Shares are registered pursuant to the provisions of Section 8(a) and
(b) hereof, the certificate or certificates evidencing the Warrant Shares shall
bear the following legend:
"THE SHARES REPRESENTED BY THIS
CERTIFICATE HAVE BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, PURSUANT TO
A REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. HOWEVER,
SUCH SHARES MAY NOT BE OFFERED OR SOLD EXCEPT
PURSUANT TO (i) A POST-EFFECTIVE AMENDMENT TO
SUCH REGISTRATION STATEMENT, UNLESS COUNSEL OF
COMPANY ADVISES IN WRITING THAT SUCH
POST-EFFECTIVE AMENDMENT IS NOT REQUIRED, IN
WHICH EVENT SUCH SHARES MAY BE OFFERED PURSUANT
TO THE ORIGINAL REGISTRATION STATEMENT PURSUANT
TO WHICH THESE SHARES HAVE BEEN REGISTERED,
(ii) A SEPARATE REGISTRATION STATEMENT UNDER
SUCH ACT, OR (iii) AN EXEMPTION FROM
REGISTRATION UNDER SUCH ACT."
11. Replacement of Warrants. Upon receipt of evidence satisfactory
to the Company of the loss, theft, destruction or mutilation of any Warrant (and
upon surrender of any Warrant if mutilated), and upon reimbursement of the
Company's reasonable incidental expenses and execution of a reasonable lost
security indemnification agreement, the Company shall execute and deliver to the
Holder thereof a new Warrant of like date, tenor and denomination.
12. No Rights as Stockholder. The Holder of any Warrant shall not
have, solely on account of such status, any rights of a stockholder of the
Company, either at law or in equity, or to any notice of meetings of
stockholders or of any other proceedings of the Company, except as provided in
this Warrant.
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13. Notices. All notices, requests, consents and other
communications hereunder shall be in writing and shall be deemed to have been
duly made when delivered, or mailed by registered or certified mail, return
receipt requested:
(a) If to the registered Holder of this Warrant, to the
address of such Holder as shown on the books of the Company; or
(b) If to the Company, to the address set forth on the
first page of this Warrant or to such other address as the Company may designate
by notice to the Holder.
14. Successors. All the covenants, agreements, representations and
warranties contained in this Warrant shall bind the parties hereto and their
respective heirs, executors, administrators, distributees, successors and
assigns.
15. Headings. The Article and Section headings in this Warrant are
inserted for purposes of convenience only and shall have no substantive effect.
16. Governing Law. This Warrant shall be construed in accordance
with the laws of the State of New York applicable to contracts made and
performed within such State, without regard to principles of conflicts of law.
17. Modification of Agreement. This Warrant shall not otherwise be
modified, supplemented or amended in any respect unless such modification,
supplement or amendment is in writing and signed by the Company and the Holder
of this Warrant and Holders of any portion of the Warrant subsequently assigned
or transferred in accordance with the terms of this Warrant.
18. Consent to Jurisdiction. The Company and the Holder
irrevocably consent to the jurisdiction of the courts of the State of New York
and of any federal court located in such State in connection with any action or
proceeding arising out of or relating to this Warrant, any document or
instrument delivered pursuant to, in connection with or simultaneously with this
Warrant, or a breach of this Warrant or any such document or instrument. In any
such action or proceeding, the Company waives personal service of any summons,
complaint or other process and agrees that service thereof may be made in
accordance with Section 13 hereof.
IN WITNESS WHEREOF, the undersigned has executed this instrument as of
the date set forth below.
Dated: _____________, 1996 LXR BIOTECHNOLOGY INC.
By:___________________________
Name:_________________________
Title:________________________
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FORM OF ASSIGNMENT
(To be executed by the registered holder if such holder desires to
transfer the attached Warrant.)
FOR VALUE RECEIVED, _______________________ hereby sells, assigns, and
transfers unto _________________, having an address at
___________________________ _______________________, the attached Warrant to the
extent of the right to purchase ____________ Shares of $0.0001 par value per
share, of LXR Biotechnology Inc. (the "Company"), together with all right,
title, and interest therein, and does hereby irrevocably constitute and appoint
_________________ as attorney to transfer such Warrant on the books of the
Company, with full power of substitution.
Dated: _______________, 199_
____________________________________
Print name of holder of Warrant
By:_________________________________
Name:_______________________________
Title:______________________________
NOTICE
The signature on the foregoing Assignment must correspond to the name
as written upon the face of this Warrant in every particular, without alteration
or enlargement or any change whatsoever.
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To:
CASH EXERCISE FORM
The undersigned hereby exercises its rights to purchase _________
Warrant Shares covered by the within Warrant and tenders payment herewith in the
amount of $_____________ in accordance with the terms thereof, and requests that
certificates for such securities be issued in the name of, and delivered to:
(Print Name, Address and Social Security
or Tax Identification Number)
and, if such number of Warrant Shares shall not be all the Warrant Shares
covered by the within Warrant, that a new Warrant for the balance of the Warrant
Shares covered by the within Warrant be registered in the name of, and delivered
to, the undersigned at the address stated below.
Dated:__________________ Name:______________________________
(Print)
___________________________________
(Signature)
(Signature must conform to the name of the
Warrant Holder specified on the face
of the Warrant)
Address:___________________________
___________________________
___________________________
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To:
CASHLESS EXERCISE FORM
(To be executed upon conversion of the attached Warrant)
The undersigned hereby irrevocably elects to surrender its Warrant for
the number of Warrant Shares as shall be issuable pursuant to the cashless
exercvise provisions of Section 1 of the within Warrant, in respect of ________
Warrant Shares underlying the within Warrant, and requests that certificates for
such Warrant Shares be issued in the name of and delivered to:
(Print Name, Address and Social Security
or Tax Identification Number)
and, if such number of Warrant Shares shall not be all the shares exchangeable
or purchasable under the within Warrant, that a new Warrant for the balance of
the Warrant Shares covered by the within Warrant be registered in the name of,
and delivered to, the undersigned at the address stated below.
Dated:__________________ Name:______________________________
(Print)
___________________________________
(Signature)
Address:___________________________
___________________________
___________________________
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