EXHIBIT 4.2 TO FORM S-3
SPECTRASCIENCE, INC.
(A MINNESOTA CORPORATION)
WARRANT TO PURCHASE _______________ SHARES
OF COMMON STOCK*
(*THIS WARRANT IS SUBJECT TO THE RESTRICTIONS ON TRANSFER SET FORTH
AT THE BOTTOM OF THE LAST PAGE HEREOF)
VOID AFTER MIDNIGHT, MINNEAPOLIS, MINNESOTA
TIME, ON _____________, ______.
No. ________
This is the certify that, for value received,__________________________
_________________________________ (the "Holder") is entitled to purchase,
subject to the provisions of this Warrant, from SPECTRASCIENCE, INC., a
Minnesota corporation (the "Company"), at any time from and after the date
hereof and prior to ______________, _____, (the "Exercise Period:), up to
_________________________________ fully paid the nonassessable shares of the
Common Stock, twenty five cent par value, of the Company ("Common Stock") ,
exercisable at the purchase price per share of $_____ subject to the provisions
of this Warrant. The number of shares of Common Stock to be received upon the
exercise of this Warrant and the price to be paid for a share of Common Stock
may be adjusted from time to time as hereinafter set forth. The shares of Common
Stock deliverable upon such exercise, and as adjusted from time to time, are
hereinafter sometimes referred to as "Warrant Stock" and the exercise price of a
share of Common Stock in effect at any time and as adjusted from time to time
hereinafter sometimes referred to as the "Exercise Price." This Warrant is one
of a series of Warrants identical in form which may be issued by the Company to
purchase shares of Common Stock of the Company and the term "Warrants" as used
herein means all such warrants (including this Warrant).
1. EXERCISE OF WARRANT. This Warrant may be exercised in whole or in part at any
time or from time to time during the Exercise Period, but not later than
Midnight, Minnesota Time, on _______________, _____, or if ______________, _____
is a day on which banking institutions are authorized by law to close, then on
the next succeeding day which shall not be such a day, by presentation and
surrender hereof to the Company or at the office of its stock transfer agent, if
any, with the Exercise Form annexed hereto duly executed and accompanied by
payment of the Exercise Price for the number of shares specified in such form,
together with all Federal and state taxes applicable upon such exercise. If this
Warrant should be exercised in part only, the Company shall, upon surrender of
this Warrant for cancellation, execute and deliver a new Warrant evidencing the
right of the Holder to purchase the balance of the shares purchasable hereunder.
Upon receipt by the Company of this Warrant at the office or agency of the
Company, in proper form for exercise, the Holder shall be deemed to be the
Holder of record of the shares of Common Stock issuable upon such exercise,
notwithstanding that the stock transfer books of the Company shall then be
closed or that certificates representing such shares of Common Stock shall not
then be actually delivered to the Holder.
2. RESERVATION OF SHARES. The Company hereby agrees that at all times there
shall be reserved for issuance and/or delivery upon exercise of this Warrant
such number of shares of Common Stock as shall be required for issuance or
delivery upon the exercise of this Warrant.
3. FRACTIONAL SHARES. No fractional shares or scrip representing fractional
shares shall be issued upon the exercise of this Warrant. With respect to any
fraction of a share called for upon any exercise hereof, the Company shall pay
to the Holder an amount in cash equal to such fraction multiplied by the current
market value of such fractional share, determined as follows:
3.1 If the Common Stock is listed on national securities exchange
or admitted to unlisted trading privileges on such exchange,
the current value shall be the last reported sale price of the
Common Stock on such exchange on the last business day prior
to the date of exercise of this Warrant or if no such sale is
made on such day, the average of the closing bid and asked
prices for such day on such exchange; or
3.2 If the Common Stock is not so listed or admitted to unlisted
trading privileges, current value shall be the mean of the
last reported bid and asked prices reported by bid and asked
prices reported by the National Association of Securities
Dealers Quotation System (or, if not so quoted on NASDAQ, by
the National Quotation Bureau, Inc.) on the last business day
prior to the date of the exercise of this Warrant; or
3.3 If the Common Stock is not so listed or admitted to unlisted
trading privileges and bid and asked prices are not so
reported, the current value shall be an amount, not less than
book value, determined in such reasonable manner as may be
prescribed by the Board of Directors of the Company, such
determination to be final and binding on the Holder.
4. EXCHANGE, ASSIGNMENT OR LOSS OF WARRANT. Subject to Section 7, this Warrant
is exchangeable, without expense, at the option of the Holder, upon presentation
and surrender hereof to the Company for other Warrants of different
denominations entitling the Holder thereof to purchase in the aggregate the same
number of shares of Common Stock purchasable hereunder. Any such assignment
shall be made by surrender of this Warrant with the Assignment Form annexed
hereto duly executed and funds sufficient to pay any transfer tax, whereupon the
Company shall, without change, execute and deliver a new Warrant in the name of
the assignee named in such instrument of assignment and this Warrant shall
promptly be canceled. This Warrant may be divided or combined with other
Warrants which carry the same rights upon presentation hereof at the office of
the Company or at the office of its stock transfer agent, if any, together with
a written notice specifying the names and denominations in which new Warrants
are to be issued and signed by the Holder hereof The term "Warrant" issued
herein includes any Warrants issued in substitution for or replacement of this
Warrant, or into which this Warrant may be divided or exchanged. Upon receipt by
the Company of evidence satisfactory to it of the loss, theft, destruction or
mutilation of this Warrant, and (in the case of loss, theft or destruction) of
reasonably satisfactory indemnification, and upon surrender and cancellation of
this Warrant, if mutilated, the Company will execute and deliver a new Warrant
of like tenor and date. Any such new Warrant executed and delivered shall
constitute an additional contractual obligation on the part of the Company,
whether or not this Warrant so lost, stolen, destroyed or mutilated shall be at
any time enforceable by anyone.
5. RIGHTS OF THE HOLDER. The Holder shall not, by virtue hereof, be entitled to
any rights of a shareholder in the Company, either at law or equity, and the
rights of the Holder are limited to those expressed in the Warrant and are not
enforceable against the Company, either at law or equity, except to the extent
set forth herein..
6. STOCK SPLITS, REORGANIZATION, MERGER, SALES OF ALL ASSETS.
6.1 In case the Company shall declare any dividend or other
distribution upon its outstanding capital stock payable in
capital stock or shall subdivide its outstanding shares of
capital stock into a greater number of shares, then the number
of shares of capital stock which may thereafter be purchased
upon the exercise of the rights represented hereby shall be
increased in proportion to the increase through such dividend
or subdivision and the purchase price per share shall be
decreased in such proportion. In case the Company shall at any
time combine the outstanding shares of its capital stock into
a smaller number of shares, the number of shares of capital
stock which may thereafter be purchased upon the exercise of
the rights represented hereby shall be decreased in proportion
to the increase through such combination and the purchase
price per share shall be increased in such proportion.
6.2 In case of any reclassification, capital reorganization or
other change of outstanding shares of Common Stock of the
Company (other than a change in par value, or from without par
value to par value, or from par value to without par value, or
as a result of an issuance of Common Stock by way of dividend
or other distribution or of a subdivision or combination), or
in case of any consolidation or merger of the Company with or
into another corporation (other than a merger with a
subsidiary in which merger the Company is the continuing
corporation and which does not result in any reclassification,
capital reorganization or other change of outstanding shares
of Common Stock of the class issuable upon exercise of this
Warrant) or in case of any sale or conveyance to another
corporation of the property of the Company as an entirety or
substantially as an entirety, the Company shall cause an
effective provision to be made so that the Holder shall have
the right thereafter, by excising this Warrant, to purchase
the kind and amount of shares of stock and other securities
and property receivable upon such reclassification, capital
reorganization or other change, consolidation, merger, sale or
conveyance, if any, which the Holder would have received had
the Warrants been exercised immediately prior to such event.
The Company shall not effect any such consolidation, merger,
or sale, unless prior to or simultaneously with the
consummation thereof the successor corporation (if other than
the Company) resulting from such consolidation or merger or
the corporation purchasing such assets shall assume by written
instrument executed and mailed or delivered to the Holder at
the last address of such Holder appearing on the books of the
Company, the obligation to deliver to such Holder such shares
of stock, securities or assets as, in accordance with the
foregoing provisions, such Holder may be entitled to purchase.
7. TRANSFER TO COMPLY WITH THE SECURITIES ACT OF 1933.
7.1 This Warrant or the Warrant Stock or any other security issued
or issuable upon exercise of this Warrant may not be offered
or sold except in conformity with the Securities Act of 1933,
as amended, and then only against receipt of an agreement of
such person to whom such offer of sale is made to comply with
the provisions of this Section 7.1 with respect to any resale
or other disposition of such securities.
7.2 The Company may cause the following legend to be set forth on
each Warrant and certificate representing Warrant Stock or any
other security issued or issuable upon exercise of this
Warrant not theretofore distributed to the public or sold to
underwriters for distribution to the public unless counsel for
the Company is of the opinion as to any such certificate that
such legend is unnecessary:
The securities represented by this certificate may
not be offered for sale, sold or otherwise
transferred exceptpursuant to an effective
registration statement made under the Securities Act
of 1933 ("the Act"), or pursuant to an exemption from
registration under the Act.
8. REGISTRATION RIGHTS.
(a) If the Company proposes to claim an exemption under
Section 3(b) for a public offering of any of its securities or to
register under the Securities Act of 1933 (except by a claim of
exemption or registration statement on a form that does not permit the
inclusion of shares by its security holders) any of its securities, it
will give written notice to all registered holders of Warrants, and all
registered holders of shares of common stock acquired upon the exercise
of Warrants, of its intention to do so and, on the written request of
any such registered holders given within twenty (20) days after receipt
of any such notice (which request must be made within five (5) years
from the date of this Warrant), the Company will use its best efforts
to cause all such shares, the registered holders of which shall have
requested the registration or qualification thereof, to be included in
such notification or registration statement proposed to be filed by the
Company; provided, however, that nothing herein shall prevent the
Company from, at any time, abandoning or delaying any such registration
initiated by it. If any such registration shall be underwritten in
whole or in part, the Company may require that the shares requested for
inclusion pursuant to this section be included in the underwriting on
the same terms and conditions as the securities otherwise being sold
through the underwriters. In the event that, in the good faith judgment
of the managing underwriter of such public offering, the inclusion of
all of the shares originally covered by a request for registration
would reduce the number of shares to be offered by the Company or
interfere with the successful marketing of the shares of stock offered
by the Company, the number of shares otherwise to be included pursuant
to this Section in the underwritten public offering may be reduced.
Those shares which are thus excluded from the underwritten public
offering shall be withheld from the market for a period, not to exceed
90 days, which the managing underwriter reasonably determines is
necessary in order to effect the underwritten public offering. All
expenses of such offering, except the fees of special counsel to such
holders and brokers' commissions or underwriting discounts payable by
such holders, shall be borne by the Company.
(b) Further, on one occasion only, commencing one year from
the date hereof, upon request by the holders of Warrants and/or the
holders of shares issued upon the exercise of the Warrants who
collectively (i) have the right to purchase at least 50% of the shares
subject to the Warrants, (ii) hold directly at least 50% of the shares
purchased hereunder, or (iii) have the right to purchase or hold
directly an aggregate of at least 50% of the shares purchasable or
purchased hereunder, the Company will promptly take all necessary
steps, at the option of such holders, to register or qualify the sale
of the Warrants or such shares by the holders thereof, or to register
the issuance by the Company of shares upon the exercise of Warrants,
under the Securities Act of 1933 (and, upon the request of such
holders, under Rule 415 thereunder) and such state laws as such holders
may reasonably request; provided that (i) such request must be made by
___________, _____, and (ii) the Company may delay the filing of any
registration statement requested pursuant to this section to a date not
more than ninety (90) days following the date of such request if in the
opinion of the Company's principal investment banker at the time of
such request such a delay is necessary in order not to adversely affect
financing efforts then underway at the Company or if in the opinion of
the Company such a delay is necessary or advisable to avoid disclosure
of material nonpublic information. The costs and expenses directly
related to any registration requested pursuant to this section,
including but not limited to legal fees of the Company's counsel, audit
fees, printing expense, filing fees and fees and expenses relating to
qualifications under state securities or blue sky laws incurred by the
Company shall be borne entirely by the Company; provided, however, that
the persons for whose account the securities covered by such
registration are sold shall bear the expenses of underwriting
commissions applicable to their shares and fees of their legal counsel.
If the holders of Warrants and the holders of shares of Common Stock
underlying the Warrants are the only persons whose shares are included
in the registration pursuant to this section, such holders shall bear
the expense of inclusion of audited financial statements in the
registration statement which are not dated as of the Company's normal
fiscal year or are not otherwise prepared by the Company for its own
business purposes. The Company shall keep effective and maintain any
registration, qualification, notification or approval specified in this
paragraph for such period as may be necessary for the holders of the
Warrants and such common stock to dispose thereof, and from time to
time shall amend or supplement, at the holder's expense, the prospectus
or offering circular used in connection therewith to the extent
necessary in order to comply with applicable law, provided that the
Company shall not be obligated to maintain any registration for a
period of more than nine (9) months.
If, at the time any written request for registration is
received by the Company pursuant to this Section 8(b), the Company has
determined to proceed with the actual preparation and filing of a
registration statement under the Securities Act in connection with the
proposed offer and sale for cash of any of its securities by it or any
of its security holders, such written request shall be deemed to have
been given pursuant to Section 8(a) hereof rather than this Section
8(b), and the rights of the holders of Warrants and or shares issued
upon the exercise of the Warrants covered by such written request shall
be governed by Section 8(a) hereof.
The managing underwriter of an offering registered pursuant to
this Section 8(b), if any, shall be selected by the holders of a
majority of the Warrants and/or shares issued upon the exercise of the
Warrants for which registration has been requested and shall be
reasonably acceptable to the Company. Without the written consent of
the holders of a majority of the Warrants and/or shares issued upon
exercise of the Warrants for which registration has been requested
pursuant to this Section 8(b), neither the Company nor any other holder
of securities of the Company may include securities in such
registration if in the good faith judgment of the managing underwriter
of such public offering the inclusion of such securities would
interfere with the successful marketing of the Warrants and/or shares
issued upon the exercise of the Warrants or require the exclusion of
any portion of the Warrants and/or shares issued upon the exercise of
the Warrants to be registered. Subject to the preceding sentence,
shares to be excluded from an underwritten public offering shall be
selected in the manner provided in Section 8(a) hereof.
(c) If and whenever the Company is required by the provisions
of Section 8(a) or 8(b) hereof to effect the registration of Warrants
and/or shares issued upon the exercise of the Warrants under the
Securities Act, the Company will:
(i) prepare and file with the Commission a
registration statement with respect to such securities, and
use its best efforts to cause such registration statement to
become and remain effective for such period as may be
reasonably necessary to effect the sale of such securities;
(ii) prepare and file with the Commission such
amendments to such registration statement and supplements to
the prospectus contained therein as may be necessary to keep
such registration statement effective for such period as may be
reasonably necessary to effect the sale of such securities;
(iii) furnish to the security holders participating
in such registration and to the underwriters of the securities
being registered such reasonable number of copies of the
registration statement, preliminary prospectus, final
prospectus and such other documents as such underwriters may
reasonably request in order to facilitate the public offering
of such securities;
(iv) use its best efforts to register or qualify the
securities covered by such registration statement under such
state securities or blue sky laws of such jurisdictions as
such participating holders may reasonably request in writing
within 30 days following the original filing of such
registration statement, except that the Company shall not for
any purpose be required to execute a general consent to
service of process or to qualify to do business as a foreign
corporation in any jurisdiction wherein it is not so
qualified;
(v) notify the security holders participating in such
registration, promptly after it shall receive notice thereof,
of the time when such registration statement has become
effective or a supplement to any prospectus forming a part of
such registration statement has been filed;
(vi) notify such holders promptly of any request by
the Commission for the amending or supplementing of such
registration statement or prospectus or for additional
information;
(vii) prepare and file with the Commission, promptly
upon the request of any such holders, any amendments or
supplements to such registration statement or prospectus
which, in the opinion of counsel for such holders (and
concurred in by counsel for the Company), is required under
the Securities Act or the rules and regulations thereunder in
connection with the distribution of the Warrants or shares by
such holder;
(viii) prepare and promptly file with the Commission
and promptly notify such holders of the filing of such
amendment or supplement to such registration statement or
prospectus as may be necessary to correct any statements or
omissions if, at the time when a prospectus relating to such
securities is required to be delivered under the Securities
Act, any event shall have occurred as the result of which any
such prospectus or any other prospectus as then in effect
would include an untrue statement of a material fact or omit
to state any material fact necessary to make the statements
therein, in the light of the circumstances in which they were
made, not misleading;
(ix) advise such holders, promptly after it shall
receive notice or obtain knowledge thereof, of the issuance of
any stop order by the Commission suspending the effectiveness
of such registration statement or the initiation or
threatening of any proceeding for that purpose and promptly
use its best efforts to prevent the issuance of any stop order
or to obtain its withdrawal if such stop order should be
issued;
(x) not file any amendment or supplement to such
registration statement or prospectus to which a majority in
interest of such holders shall have reasonably objected on the
grounds that such amendment or supplement does not comply in
all material respects with the requirements of the Securities
Act or the rules and regulations thereunder, after having been
furnished with a copy thereof at least five business days
prior to the filing thereof, unless in the opinion of counsel
for the Company the filing of such amendment or supplement is
reasonably necessary to protect the Company from any
liabilities under any applicable federal or state law and such
filing will not violate applicable law; and
(xi) at the request of any such holder, furnish on
the effective date of the registration statement and, if such
registration includes an underwritten public offering, at the
closing provided for in the underwriting agreement: (i)
opinions, dated such respective dates, of the counsel
representing the Company for the purposes of such
registration, addressed to the underwriters, if any, and to
the holder or holders making such request, covering such
matters as such underwriters and holder or holders may
reasonably request; and (ii) letters, dated such respective
dates, from the independent certified public accountants of
the Company, addressed to the underwriters, if any, and to the
holder or holders making such request, covering such matters
as such underwriters and holder or holders may reasonably
request, in which letter such accountants shall state (without
limiting the generality of the foregoing) that they are
independent certified public accountants with the meaning of
the Securities Act and that in the opinion of such accountants
the financial statements and other financial data of the
Company included in the registration statement or the
prospectus or any amendment or supplement thereto comply in
all material respects with the applicable accounting
requirements of the Securities Act.
(d) The Company hereby indemnifies the holder of this Warrant
and of any common stock issued or issuable hereunder, its officers and
director, and any person who controls such Warrant holder or such
holder of common stock within the meaning of Section 15 of the
Securities Act of 1933, against all losses, claims, damages and
liabilities caused by any untrue statement of a material fact contained
in any registration statement, prospectus, notification or offering
circular (and as amended or supplemented if the Company shall have
furnished any amendments or supplements thereto) or any preliminary
prospectus or caused by any omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading except insofar as such losses, claims, damages
or liabilities are caused by any untrue statement or omission contained
in information furnished in writing to the Company by such Warrant
holder or such holder of common stock expressly for use therein, and
each such holder by its acceptance hereof severally agrees that it will
indemnify and hold harmless the Company and each of its officers who
signs such registration statement and each of its directors and each
person, if any, who controls the Company within the meaning of Section
15 of the Securities Act of 1933 with respect to losses, claims,
damages or liabilities which are caused by any untrue statement or
omission contained in information furnished in writing to the Company
by such holder expressly for use therein.
9. APPLICABLE LAW. This Warrant shall be governed by, and construed in
accordance with, the laws of the State of Minnesota.
DATED: _________________________
SPECTRASCIENCE, INC.,
By:
---------------------------------------
Xxxxx X. XxXxxxx
Its: President & CEO
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933 OR APPLICABLE STATE SECURITIES LAWS. THESE SECURITIES HAVE BEEN
ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED, ASSIGNED
OR OTHERWISE DISPOSED OF, AND NO TRANSFER OF THE SECURITIES WILL BE MADE BY THE
COMPANY OR ITS TRANSFER AGENT, IN THE ABSENCE OF SUCH REGISTRATION OR AN OPINION
OF COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
