THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED OR ANY STATE SECURITIES LAWS. NO SALE OR
DISPOSITION MAY BE EFFECTED WITHOUT (i) EFFECTIVE REGISTRATION
STATEMENTS RELATED THERETO, (ii) AN OPINION OF COUNSEL FOR THE
HOLDER, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH
REGISTRATIONS ARE NOT REQUIRED, (iii) RECEIPT OF NO ACTION LETTERS
FROM THE APPROPRIATE GOVERNMENTAL AUTHORITIES, OR (iv) OTHERWISE
COMPLYING WITH THE PROVISIONS OF SECTION 7 OF THIS WARRANT.
GENSIA, INC.
WARRANT TO PURCHASE 70,000 SHARES
OF COMMON STOCK
THIS CERTIFIES THAT, for value received, MMC/GATX Partnership No.
I (the "Partnership") is entitled to subscribe for and purchase 70,000
shares of the fully paid and nonassessable Common Stock (as adjusted
pursuant to Section 4 hereof, the "Shares") of Gensia Pharmaceuticals,
Inc., a Delaware corporation (the "Company"), at the price of $5.25 per
share (such price and such other price as shall result, from time to
time, from the adjustments specified in Section 4 hereof is herein
referred to as the "Warrant Price"), subject to the provisions and upon
the terms and conditions hereinafter set forth. As used herein, (a) the
term "Common Stock" shall mean the Company's presently authorized Common
Stock, and any stock for which such Common Stock may hereafter be
converted or exchanged, (b) the term "Date of Grant" shall mean July 22,
1996, and (c) the term "Other Warrants" shall mean any other warrants
issued by the Company in connection with the transaction with respect to
which this Warrant was issued, and any warrant issued upon transfer or
partial exercise of this Warrant.
1. TERM. The purchase right represented by this Warrant is
exercisable, in whole or in part, at any time and from time to time from
the Date of Grant through ten (10) years after the Date of Grant.
2. METHOD OF EXERCISE; PAYMENT; ISSUANCE OF NEW WARRANT.
Subject to Section 1 hereof, the purchase right represented by this
Warrant may be exercised by the holder hereof, in whole or in part and
from time to time, by either, at the election of the holder hereof, (a)
the surrender of this Warrant (with the notice of exercise form attached
hereto as Exhibit A duly executed) at the principal office of the
Company and by the payment to the Company, by check, of an amount equal
to the then applicable Warrant Price multiplied by the number of Shares
then being purchased, or (b) if in connection with a registered public
offering of the Company's securities, the surrender of this Warrant
(with the notice of exercise form attached hereto as Exhibit A-1 duly
executed) at the principal office of the Company together with notice of
arrangements reasonably satisfactory to the Company for payment to the
Company either by check or from the proceeds of the sale of shares to be
sold by the holder in such public offering of an amount equal to the
then applicable Warrant Price per share multiplied by the number of
Shares then being purchased. The person or persons in whose name(s) any
certificates)
representing shares of Common Stock shall be issuable upon exercise of
this Warrant shall be deemed to have become the holder(s) of record of,
and shall be treated for all purposes as the record holder(s) of, the
shares represented thereby (and such shares shall be deemed to have been
issued) immediately prior to the close of business on the date or dates
upon which this Warrant is exercised. In the event of any exercise of
the rights represented by this Warrant, certificates for the shares of
stock so purchased shall be delivered to the holder hereof as soon as
possible and in any event within thirty days after such exercise, and,
unless this Warrant has been fully exercised or expired, a new Warrant
representing the portion of the Shares, if any, with respect to which
this Warrant shall not then have been exercised shall also be issued to
the holder hereof as soon as possible and in any event within such
thirty day period.
3. STOCK FULLY PAID; RESERVATION OF SHARES. All Shares that
may br issued upon the exercise of the rights represented by this
Warrant will, upon issuance pursuant to the terms and conditions herein,
be fully paid and nonassessable, and free from all taxes, liens and
charges with respect to the issue thereof. During the period within
which the rights represented by this Warrant may be exercised, the
Company will at all times have authorized, and reserved for the purpose
of the issue upon exercise of the purchase rights evidenced by this
Warrant, a sufficient number of shares of its Common Stock to provide
for the exercise of the rights represented by this Warrant.
4. ADJUSTMENT OF WARRANT PRICE AND NUMBER OF SHARES. The
number and kind of securities purchasable upon the exercise of this
Warrant and the Warrant Price shall be subject to adjustment from time
to time upon the occurrence of certain events, as follows:
(a) RECLASSIFICATION OR MERGER. In case of any
reclassification, change or conversion of securities of the class
issuable upon exercise of this Warrant (other than a change in par
value, or from par value to no par value, or from no par value to par
value, or as a result of a subdivision or combination), or in case of
any merger of the Company with or into another corporation (other than
in which the Company is the acquiring and the surviving corporation and
which does not result in any reclassification or change of outstanding
securities issuable upon exercise of this Warrant), or in case of any
sale of all or substantially all of the assets of the Company, the
Company, or such successor or purchasing corporation, as the case may
be, shall duly execute and deliver to the holder of this Warrant a new
Warrant (in form and substance satisfactory to the holder of this
Warrant), so that the holder of this Warrant shall have the right to
receive, at a total purchase price not to exceed that payable upon the
exercise of the unexercised portion of this Warrant, and in lieu of the
shares of Common Stock theretofore issuable upon exercise of this
Warrant, the kind and amount of shares of stock, other securities, money
and property receivable upon such reclassification, change or merger a
holder of the number of shares of Common Stock then purchasable under
this Warrant. Such new Warrant shall provide for adjustments that shall
be as nearly equivalent as may be practicable to the adjustments
provided for in this Section 4 and shall provide for antidilution
protection that shall be as nearly equivalent as may be practicable to
the antidilution provisions applicable to the Common Stock on the Date
of Grant. The provisions of this Subsection (a) shall similarly apply
to successive reclassifications, changes, mergers and transfers.
(b) SUBDIVISION OR COMBINATION OF SHARES. If the Company
at any time while this Warrant remains outstanding and unexpired shall
subdivide or combine its outstanding shares of Common Stock, the Warrant
Price shall be proportionately decreased in the case of a subdivision or
increased in the case of a combination, effective at the close of
business on the date the subdivision or combination becomes effective.
(c) STOCK DIVIDENDS AND OTHER DISTRIBUTIONS. If the
Company at any time while this Warrant is outstanding and unexpired
shall (i) pay a dividend with respect to Common Stock payable in Common
Stock, or (ii) make any other distribution with respect to Common Stock
(except any distribution specifically provided for in the foregoing Sub
Sections (a) and (b)) of Common Stock, then the Warrant Price shall be
adjusted, from and after the date of determination of shareholders
entitled to receive such dividend or distribution, to that price
determined by multiplying the Warrant Price in effect immediately prior
to such date of determination by a fraction (i) the numerator of which
shall be the total number of shares of Common Stock outstanding
immediately prior to such dividend or distribution, and (ii) the
denominator of which shall be the total number of shares of Common Stock
outstanding immediately after such dividend or distribution.
(d) ADJUSTMENT OF NUMBER OF SHARES. Upon each adjustment
in the Warrant Price, the number of Shares of Common Stock purchasable
hereunder shall be adjusted, to the nearest whole share, to the product
obtained by multiplying the number of Shares purchasable immediately
prior to such adjustment in the Warrant Price by a fraction, the
numerator of which shall be the Warrant Price immediately prior to such
adjustment and the denominator of which shall be the Warrant Price
immediately thereafter.
(e) ANTIDILUTION RIGHTS. The relative rights applicable
to the Shares of the Company are set forth the Company's Restated
Certificate of Incorporation (the "Charter"), a true and complete copy
of which is attached hereto as Exhibit B. The Company shall promptly
provide the holder hereof with any restatement, amendment or
modification to the Charter promptly after the same has been made.
5. NOTICE OF ADJUSTMENTS. Whenever the Warrant Price or the
number of Shares purchasable hereunder shall be adjusted pursuant to
Section 4 hereof, the Company shall make a certificate signed by its
chief financial officer setting forth, in reasonable detail, the event
requiring the adjustment, the amount of the adjustment, the method by
which such adjustment was calculated, and the Warrant Price and the
number of Shares purchasable hereunder after giving effect to such
adjustment, shall be mailed (without regard to Section 13 hereof, by
first class mail, postage prepaid) to the holder of this Warrant.
6. FRACTIONAL SHARES. No fractional shares of Common Stock
will be issued in connection with any exercise hereunder, but in lieu of
such fractional shares the Company shall make a cash payment therefor
based on the fair market value of the Common Stock on the date of
exercise as reasonably determined in good faith by the Company's Board
of Directors.
7. COMPLIANCE WITH SECURITIES ACT; DISPOSITION OF WARRANT OR
SHARES OF COMMON STOCK.
(a) COMPLIANCE WITH SECURITIES ACT. The holder of this
Warrant, by acceptance hereof, agrees that this Warrant and the shares
of Common Stock to be issued upon exercise hereof are being acquired for
investment and that such holder will not offer, sell or otherwise
dispose of this Warrant or any shares of Common Stock to be issued upon
exercise hereof except under circumstances which will not result in a
violation of the Act. Upon exercise of this Warrant, the holder hereof
shall confirm in writing, by executing the form attached as Schedule 1
to Exhibit A hereto, that the shares of Common Stock so purchased are
being acquired for investment and not with a view toward distribution or
resale. This Warrant and all shares of Common Stock issued upon
exercise of this Warrant (unless registered under the Act) shall be
stamped or imprinted with a legend in substantially the following form:
"THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES
LAWS. NO SALE OR DISPOSITION MAY BE EFFECTED WITHOUT (i)
EFFECTIVE REGISTRATION STATEMENTS RELATED THERETO, (ii) AN OPINION
OF COUNSEL FOR THE HOLDER, REASONABLY SATISFACTORY TO THE COMPANY,
THAT SUCH REGISTRATIONS ARE NOT REQUIRED, (iii) RECEIPT OF NO
ACTION LETTERS FROM THE APPROPRIATE GOVERNMENTAL AUTHORITIES, OR
(iv) OTHERWISE COMPLYING WITH THE PROVISIONS OF SECTION 7 OF THE
WARRANT UNDER WHICH THESE SECURITIES WERE ISSUED, DIRECTLY OR
INDIRECTLY."
In addition, in connection with the issuance of this Warrant, the
holder specifically represents to the Company by acceptance of this
Warrant as follows:
(1) The holder is aware of the Company's business
affairs and financial condition, and has acquired information about the
Company sufficient to reach an informed and knowledgeable decision to
acquire this Warrant. The holder is acquiring this Warrant for its own
account for investment purposes only and not with a view to, or for the
resale in connection with, any "distribution" thereof for purposes of
the Act.
(2) The holder understands that this Warrant has not
been registered under the Act in reliance upon a specific exemption
therefrom, which exemption depends upon, among other things, the bona
fide nature of the holder's investment intent as expressed herein. In
this connection, the holder understands that, in the view of the SEC,
the statutory basis for such exemption may be unavailable if the
holder's representation was predicated solely upon a present intention
to hold the Warrant for the minimum capital gains period specified under
tax statutes, for a deferred sale, for or until an increase or decrease
in the market price of the Warrant, or for a period of one year or any
other fixed period in the future.
(3) The holder further understands that this Warrant
must be held indefinitely unless subsequently registered under the Act
and any applicable state securities laws, or unless exemptions from
registration are otherwise available. Moreover, the holder understands
that except as provided in Section 9 hereof, the Company is under no
obligation to register this Warrant or the shares issuable upon exercise
of this Warrant.
(4) The holder is aware of the provisions of Rule
144, promulgated under the Act, which, in substance, permit limited
public resale of "restricted securities" acquired, directly or
indirectly, from the issuer thereof (or from an affiliate of such
issuer), in a non-public offering subject to the satisfaction of certain
conditions, if applicable, including, among other things: The
availability of certain public information about the Company, the resale
occurring not less than two years after the party has purchased and paid
for the securities to be sold; the sale being made through a broker in
an unsolicited "broker's transaction" or in transactions directly with a
market maker (as said term is defined under the Securities Exchange Act
of 1934, as amended) and the amount of securities being sold during any
three-month period not exceeding the specified limitations stated
therein.
(5) The holder further understands that at the time
it wishes to sell this Warrant there may be no public market upon which
to make such a sale, and that, even if such a public market then exists,
the Company may not be satisfying the current public information
requirements of Rule 144, and that, in such event, the holder may be
precluded from selling this Warrant under Rule 144 even if the two-year
minimum holding period had been satisfied.
(6) The holder further understands that in the event
all of the requirements of Rule 144 are not satisfied, registration
under the Act, compliance with Regulation A, or some other registration
exemption will be required; and that, notwithstanding the fact that Rule
144 is not exclusive, the Staff of the SEC has expressed its opinion
that persons proposing to sell private placement securities other than
in a registered offering and otherwise than pursuant to Rule 144 will
have a substantial burden of proof in establishing that an exemption
from registration is available for such offers or sales, and that such
persons and their respective brokers who participate in such
transactions do so at their own risk.
(b) DISPOSITION OF WARRANT OR SHARES. With respect to any
offer, sale or other disposition of this Warrant or any shares of Common
Stock acquired pursuant to the exercise of this Warrant prior to
registration of such Warrant or shares, the holder hereof and each
subsequent holder of this Warrant agrees to give written notice to the
Company prior thereto, describing briefly the manner thereof, together
with a written opinion of such holder's counsel, if reasonably requested
by the Company, to the effect that such offer, sale or other disposition
may be effected without registration or qualification (under the Act as
then in effect or any federal or state law then in effect) of this
Warrant or such shares of Common Stock and indicating whether or not
under the Act certificates for this Warrant or such shares of Common
Stock to be sold or otherwise disposed of require any restrictive legend
as to applicable restrictions on transferability in order to ensure
compliance with such law. Promptly upon receiving such written notice
and reasonably satisfactory opinion, if so requested, the Company, as
promptly as practicable, shall notify such holder that such holder may
sell or otherwise dispose of this
warrant or such shares of Common Stock, all in accordance with the terms
of the notice delivered to the Company. If a determination has been
made pursuant to this Subsection (b) that the opinion of counsel for the
holder is not reasonably satisfactory to the Company, the Company shall
so notify the holder promptly after such determination has been made.
Notwithstanding the foregoing, this Warrant or such shares of Common
Stock may, as to such federal laws, be offered, sold or otherwise
disposed of in accordance with Rule 144 under the Act, provided that the
Company shall have been furnished with such information as the Company
may reasonably request to provide a reasonable assurance that the
provisions of Rule 144 have been satisfied. Each certificate
representing this Warrant or the shares of Common Stock thus transferred
(except a transfer pursuant to Rule 144) shall bear a legend as to the
applicable restrictions on transferability in order to ensure compliance
with such laws, unless in the aforesaid opinion of counsel for the
holder, such legend is not required in order to ensure compliance with
such laws. The Company may issue stop transfer instructions to its
transfer agent in connection with such restrictions.
(c) Neither any restrictions of any legend described in
this Warrant nor the requirements of Section 7(b) above shall apply to
any transfer without any additional consideration of, or grant of a
security interest in, this Warrant or any part hereof (i) to a partner
of the holder if the holder is a partnership, (ii) by the holder to a
partnership of which the holder is a general partner, or (iii) to any
affiliate of the holder if the holder is a corporation; PROVIDED,
HOWEVER, in any such transfer, the transferee shall deliver a
certificate reasonably acceptable to the Company that such transferee is
a sophisticated or "accredited" investor within the federal securities
laws; and on the Company's request, such transferee shall agree in
writing to be bound by the terms of this Warrant as if an original
signatory hereto.
8. RIGHTS AS SHAREHOLDERS; INFORMATION. No holder of this
Warrant, as such, shall be entitled to vote or receive dividends or be
deemed the holder of Common Stock or any other securities of the Company
which may at any time be issuable on the exercise hereof for any
purpose, nor shall anything contained herein be construed to confer upon
the holder of this Warrant, as such, any of the rights of a shareholder
of the Company or any right to vote for the election of directors or
upon any matter submitted to shareholders at any meeting thereof, or to
receive notice of meetings, or to receive dividends or subscription
rights or otherwise until this Warrant shall have been exercised and the
Shares purchasable upon the exercise hereof shall have become
deliverable, as provided herein. Notwithstanding the foregoing, the
Company will transmit to the holder of this Warrant such information,
documents and reports as are generally distributed to the holders of any
class or series of the securities of the Company concurrently with the
distribution thereof to the shareholders in the manner the same are
distributed to stockholders.
9. REGISTRATION RIGHTS. The Company covenants and agrees to
the registration rights set forth in Schedule 2 hereto as if such rights
were set forth at length herein.
10. RIGHT TO CONVERT WARRANT INTO COMMON STOCK; NET ISSUANCE.
(a) RIGHT TO CONVERT. In addition to and without limiting
the rights of the holder under the terms of this Warrant, the holder
shall have the right to convert this Warrant or any portion thereof (the
"Conversion Right") into shares of Common Stock as provided in this
Section 10 at any time or from time to time during the term of this
Warrant. Upon exercise of the Conversion Right with respect to a
particular number of shares subject to this Warrant (the "Converted
Warrant Shares"), the Company shall deliver to the holder (without
payment by the holder of any exercise price or any cash or other
consideration) (X) that number of shares of fully paid and nonassessable
Common Stock equal to the quotient obtained by dividing the value of
this Warrant (or the specified portion hereof) on the Conversion Date
(as defined in Subsection (b) hereof), which value shall be determined
by subtracting (A) the aggregate Warrant Price of the Converted Warrant
Shares immediately prior to the exercise of the Conversion Right from
(B) the aggregate fair market value of the Converted Warrant Shares
issuable upon exercise of this Warrant (or the specified portion hereof)
on the Conversion Date (as herein defined) by (Y) the fair market value
of one share of Common Stock on the Conversion Date (as herein defined).
Expressed as a formula, such conversion shall be computed as
follows:
X = (B - A) / Y
Where: X = the number of shares of Common Stock that
may be issued to holder
Y = the fair market value (FMV) of one share
of Common Stock
A = the aggregate Warrant Price (i.e.,
Converted Warrant Shares x Warrant Price)
B = the aggregate FMV (i.e., FMV x Converted
Warrant Shares)
No fractional shares shall be issuable upon exercise of the
Conversion Right, and, if the number of shares to be issued determined
in accordance with the foregoing formula is other than a whole number,
the Company shall pay to the holder an amount in cash equal to the fair
market value of the resulting fractional share on the Conversion Date
(as hereinafter defined). For purposes of Section 9 of this Warrant,
shares issued pursuant to the Conversion Right shall be treated as if
they were issued upon the exercise of this Warrant.
(b) METHOD OF EXERCISE. The Conversion Right may be
exercised by the holder by the surrender of this Warrant at the
principal office of the Company together with a written statement
specifying that the holder thereby intends to exercise the Conversion
Right and indicating the number of shares subject to this Warrant which
are being surrendered (referred to in Subsection (a) hereof as the
Converted Warrant Shares) in exercise of the Conversion Right. Such
conversion shall be effective upon
receipt by the Company of this Warrant together with the aforesaid
written statement, or on such later date as is specified therein (the
"Conversion Date"), and, at the election of the holder hereof, may be
made contingent upon the closing of the sale of the Company's Common
Stock to the public in a public offering pursuant to a Registration
Statement under the Act (a "Public Offering"). Certificates for the
shares issuable upon exercise of the Conversion Right and, if
applicable, a new warrant evidencing the balance of the shares remaining
subject to this Warrant, shall be issued as of the Conversion Date and
shall be delivered to the holder within thirty (30) days following the
Conversion Date.
(c) DETERMINATION OF FAIR MARKET VALUE. For purposes of
this Section 10, "fair market values, of a share of Common Stock as of
the Conversion Date shall mean:
(i) If the Conversion Right is exercised in
connection with and contingent upon a Public Offering, and if the
Company's Registration Statement relating to such Public Offering -
("Registration Statement") has been declared effective by the SEC, then
the initial "Price to Public" specified in the final prospectus with
respect to such offering.
(ii) If the Conversion Right is not
exercised in connection with and contingent upon a Public Offering, then
as follows:
(A) If traded on a securities exchange,
the fair market value of the Common Stock shall be deemed to be the
average of the closing prices of the Common Stock on such exchange over
the 30-day period ending five business days prior to the Conversion
Date;
(B) If traded over-the-counter, the fair
market value of the Common Stock shall be deemed to be the average of
the closing bid prices of the Common Stock over the 30-day period ending
five business days prior to the Conversion Date; and
(C) If there is no public market for the
Common Stock, then fair market value shall be determined by mutual
agreement of the holder of this Warrant and the Company, and if the
holder and the Company are unable to so agree, at the Company's sole
expense, by an investment banker of national reputation selected by the
Company and reasonably acceptable to the holder of this Warrant.
11. REPRESENTATIONS AND WARRANTIES. The Company represents and
warrants to the holder of this Warrant as follows:
(a) This Warrant has been duly authorized and executed by
the Company and is a valid and binding obligation of the Company
enforceable in accordance with its terms, subject to laws of general
application relating to bankruptcy, insolvency and the relief of debtors
and the rules of law or principles at equity governing specific
performance, injunctive relief and other equitable remedies;
(b) The Shares have been duly authorized and reserved for
issuance by the Company and, when issued in accordance with the terms
hereof, will be validly issued, fully paid. and nonassessable;
(c) A true and complete copy of the Charter, as amended to
the Date of the Grant, has been delivered to the original holder of this
Warrant and is attached hereto as Exhibit B;
(d) The execution and delivery of this Warrant are not,
and the issuance of the Shares upon exercise of this Warrant in
accordance with the terms hereof will not be, inconsistent with the
Company's Charter or by-laws, do not contravene any law, governmental
rule or regulation, judgment or order applicable to the Company, and do
not and will not conflict with or contravene any provision of, or
constitute a material default under, any indenture, mortgage, contract
or other instrument of which the Company is a party or by which it is
bound or require the consent or approval of, the giving of notice to,
the registration or filing with or the taking of any action in respect
of or by, any Federal, state or local government authority or agency or
other person, except for actions required to be taken to comply with
federal and state securities laws, all of which actions have been taken.
(e) There are no actions, suits, audits, investigations or
proceedings pending or, to the knowledge of the Company, threatened
against the Company in any court or before any governmental commission,
board or authority which, if adversely determined, will have a material
adverse effect on the ability of the Company to perform its obligations
under this Warrant.
12. MODIFICATION AND WAIVER. This Warrant and any provision
hereof may be changed, waived, discharged or terminated only by an
instrument in writing signed by the party against which enforcement of
the same is sought.
13. NOTICES. Any notice, request, communication or other
document required or permitted to be given or delivered to the holder
hereof or the Company shall be delivered, or shall be sent by certified
or registered mail, postage prepaid, or overnight express mail or
courier service or by confirmed facsimile transmission to each such
holder at its address as shown on the books of the Company or to the
Company at the address indicated therefor on the signature page of this
Warrant or at such other address as Holder or the Company may designate
by ten days advance written notice to the other.
14. BINDING EFFECT ON SUCCESSORS. This Warrant shall be binding
upon any corporation succeeding the Company by merger, consolidation or
acquisition of all or substantially all of the Company's assets, and all
of the obligations of the Company relating to the Common Stock issuable
upon the exercise or conversion of this Warrant shall survive the
exercise, conversion and termination of this Warrant and all of the
covenants and agreements of the Company shall inure to the benefit of
the successors and assigns of the holder hereof.
15. LOST WARRANTS OR STOCK CERTIFICATES. The Company covenants
to the holder hereof that, upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or
mutilation of this Warrant or any stock certificate and, in the case of
any such loss, theft
or destruction, upon receipt of an indemnity reasonably satisfactory to
the Company, or in the case of any such mutilation upon surrender and
cancellation of such Warrant or stock certificate, the Company will make
and deliver a new Warrant or stock certificate, of like tenor, in lieu
of the lost, stolen, destroyed or mutilated Warrant or stock
certificate.
16. DESCRIPTIVE HEADINGS. The descriptive headings of the
several Sections of this Warrant are inserted for convenience only and
do not constitute a part of this Warrant.
17. GOVERNING LAW. This Warrant shall be construed and enforced
in accordance with, and the rights of the parties shall be governed by,
the laws of the State of California.
18. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS. All
representations and warranties of the Company and the holder hereof
contained herein shall survive the Date of Grant. All agreements of the
Company and the holder hereof contained herein shall survive
indefinitely until, by their respective terms, they are no longer
operative.
19. REMEDIES. In case any one or more of the covenants and
agreements contained in this Warrant shall have been breached, the
holders hereof (in the case of a breach by the Company), or the Company
(in the case of a breach by a holder), may proceed to protect and
enforce their or its rights either by suit in equity and/or by action at
law, including, but not limited to, an action for damages as a result of
any such breach and/or an action for specific performance of any such
covenant or agreement contained in this Warrant.
20. ACCEPTANCE. Receipt of this Warrant by the holder hereof
shall constitute acceptance of and agreement to the foregoing terms and
conditions.
21. NO IMPAIRMENT OF RIGHTS. The Company will not, by amendment
of its Charter or through any other means, avoid or seek to avoid the
observance or performance of any of the terms of this Warrant, but will
at all times in good faith assist in the carrying out of all such terms
and in the taking of all such action as may be necessary or appropriate
in order to protect the rights of the holder of this Warrant against
impairment.
22. VALUE. The holder of this Warrant by acceptance hereof
agrees with the Company that the value of this Warrant as of the Date of
Grant is $100.00.
GENSIA, INC.
By: ________________________________
Name: _________________________
Title: __________________________
0000 Xxxxx Xxxxxx Xxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
EXHIBIT A
NOTICE OF EXERCISE
To: Gensia, Inc.
1. The undersigned hereby elects to purchase _________ shares of
Common Stock of Gensia Pharmaceuticals, Inc. pursuant to the terms of the
attached Warrant., and tenders herewith payment of the purchase price of
such shares in full.
2. Please issue a certificate or certificates representing said
shares in the name of the undersigned or in such other name or names as
are specified below:
______________________________
(Name)
______________________________
______________________________
(Address)
3. The undersigned represents that the aforesaid shares are being
acquired for the account of the undersigned for investment and not with a
view to, or for resale in connection with, the distribution thereof and
that the undersigned. has no present intention of distributing or
reselling such shares. In support thereof, the undersigned has executed
an Investment Representation Statement attached hereto as Schedule 1.
_______________________________
(Signature)
__________________
(Date)
EXHIBIT A-1
NOTICE OF EXERCISE
To: Gensia, Inc. (the "Company")
1. Contingent upon and effective immediately prior to the closing
(the "Closing") of the Company's public offering contemplated by the
Registration Statement of Form S-______, filed _____________________,
19__, the undersigned hereby elects to purchase _____ shares of Common
Stock of the Company (or such lesser number of shares as may be sold on
behalf of the undersigned at the Closing) pursuant to the terms of the
attached Warrant.
2. Please deliver to the custodian for the selling shareholders
a stock certificate representing such shares.
3. The undersigned has instructed the custodian for the selling
shareholders to deliver to the Company $___________ or, if less, the net
proceeds due the undersigned from the sale of shares in the aforesaid
public offering. If such net proceeds are less than the purchase price
for such shares, the undersigned agrees to deliver the difference to the
Company prior to the Closing.
_______________________________
(Signature)
____________________
(Date)
SCHEDULE 1
INVESTMENT REPRESENTATION STATEMENT
Purchaser :
Company : Gensia, Inc.
Security Common Stock
Amount :
Date :
In connection with the purchase of the above listed securities and
underlying Common Stock (the "Securities"), the undersigned (the
"Purchaser") represents to the Company as follows:
(a) The Purchaser is aware of the Company's business affairs and
financial condition, and has acquired sufficient information about the
Company to reach an informed and knowledgeable decision to acquire the
Securities. The Purchaser is purchasing the Securities for its own
account for investment purposes only and not with a view to, or for the
resale in connection with, any "distribution" thereof for purposes of the
Securities Act of 1933, as amended (the "Act").
(b) The Purchaser understands that the Securities have not been
registered under the Securities Act in reliance upon a specific exemption
therefrom, which exemption depends upon, among other things, the bona fide
nature of the Purchaser's investment intent as expressed herein. In this
connection, the Purchaser understands that, in the view of the Securities
and Exchange Commission ("SEC"), the statutory basis for such exemption
may be unavailable if the Purchaser's representation was predicated solely
upon a present intention to hold these Securities for the minimum capital
gains period specified under tax statutes, for a deferred sale, for or
until an increase or decrease in the market price of the Securities, or
for a period of one year or any other fixed period in the future.
(c) The Purchaser further understands that the Securities must be
held indefinitely unless subsequently registered under the Act or unless
an exemption from registration is otherwise available. Moreover, the
Purchaser understands that the Company is under no obligation to register
the Securities. In addition, the Purchaser understands that the
certificate evidencing the Securities will be imprinted with the legend
referred to in the Warrant under which the Securities are being purchased.
(d) The Purchaser is aware of the provisions of Rule 144,
promulgated under the Act, which, in substance, permit limited public
resale of "restricted securities" acquired, directly or indirectly, from
the issuer thereof (or from an affiliate of such issuer), in a non-public
offering subject to the satisfaction of certain conditions, if applicable,
including, among other things: The availability of certain public
information about the Company, the resale occurring not less than two
years after the party has purchased and paid for the securities to be
sold; the sale being made through a broker in an unsolicited "broker's
transaction" or in transactions directly with a market maker (as said term
is defined under the Securities Exchange Act of 1934, as amended) and the
amount of securities being sold during any three-month period not
exceeding the specified limitations stated therein.
(e) The Purchaser further understands that at the time it wishes
to sell the Securities there may be no public market upon which to make
such a sale, and that, even if such a public market then exists, the
Company may not be satisfying the current public information requirements
of Rule 144, and that, in such event, the Purchaser may be precluded from
selling the Securities under Rule 144 even if the two-year minimum holding
period had been satisfied.
(f) The Purchaser further understands that in the event all of the
requirements of Rule 144 are not satisfied, registration under the Act,
compliance with Regulation A, or some other registration exemption will be
required; and that, notwithstanding the fact that Rule 144 is not
exclusive, the Staff of the SEC has expressed its opinion that persons
proposing to sell private placement securities other than in a registered
offering and otherwise than pursuant to Rule 144 will have a substantial
burden of proof in establishing that an exemption from registration is
available for such offers or sales, and that such persons and their
respective brokers who participate in such transactions do so at their own
risk.
Purchaser:
________________________________
Date: ________________, _______
SCHEDULE 2
The following provisions constitute the "Registration Rights"
referred to in Section 9 of the Warrant for 70,000 Shares of Common Stock
with the Date of Grant. Unless otherwise defined herein, capitalized
terms shall have the meaning set forth in said Warrant
9.1 DEFINITIONS. For purposes of this Section 9:
(a) The terms "Register," "registered," and "registration"
refer to a registration effected by preparing and filing a registration
statement or similar document in compliance with the Act, and the
declaration or ordering of effectiveness of such registration statement or
document;
(b) The term "Registrable Securities" means (i) the Common
Stock issuable or issued upon exercise or conversion of this Warrant or
upon exercise or conversion of the Other Warrants, and (ii) any Common
Stock of the Company issued as (or issuable upon the conversion or
exercise of any warrant, right or other security which is issued as) a
dividend or other distribution with respect to or in exchange for or in
replacement of, such Common Stock; excluding in all cases, however, any
Registrable Securities sold or transferred by a person in a transaction in
which his rights under this Section 9 are not assigned in accordance with
Section 9.7 hereof;
(c) The term "Holder" means any person owning or having the
right to acquire Registrable Securities or any assignee thereof in
accordance with Section 9.7 hereof; and
(d) The term "Form S-3" means such form under the Act as in
effect on the date hereof or any registration form under the Act
subsequently adopted by the Securities and Exchange Commission ("SEC") in
lieu of or as a replacement for such form and which similarly permits
inclusion or incorporation of substantial information by. reference to
other documents filed by the Company with the SEC.
9.2 OBLIGATIONS OF THE COMPANY. Whenever required under this
Section 9 to effect the registration of any Registrable Securities, the
Company shall, as expeditiously as reasonably possible:
(a) Prepare and file with the SEC a registration statement
with respect to such Registrable Securities and use its best efforts to
cause such registration statement to become effective, and, upon the
request of the Holders of a majority of the Registrable Securities
registered thereunder, keep such registration statement effective for up
to one hundred twenty (120) days.
(b) Prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in
connection with such registration statement as may be necessary to comply
with the provisions of the Act with respect to the disposition of all
securities covered by such registration statement.
(c) Furnish to the Holders such numbers of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Act, and such other documents as they may reasonably
request in order to facilitate the disposition of Registrable Securities
owned by them.
(d) Use its best efforts to register and qualify the
securities covered by such registration statement under such other
securities or Blue Sky laws of such jurisdictions as shall be reasonably
requested by the Holders, PROVIDED that the Company shall not be required
in connection therewith or as a condition thereto to qualify to do
business or to file a general consent to service of process in any such
states or jurisdiction.
(e) In the event of any underwritten public offering enter
into and perform its obligations under an underwriting agreement, in usual
and customary form, with the managing underwriter of such offering. Each
Holder participating in such underwriting shall also enter into and
perform its obligations under such an agreement.
(f) Notify each Holder of Registrable Securities covered by
such registration statement, at any time when a prospectus relating
thereto is required to be delivered under the Act, of the happening of any
event as a result of which the prospectus included in such registration
statement, as then in effect, includes an untrue statement of a material
fact or omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing.
(g) Furnish, at the request of any Holder requesting
registration of Registrable Securities pursuant to this Section 9, on the
date that such Registrable Securities are delivered to the underwriters
for sale in connection with a registration pursuant to this Section 9, if
such securities are being sold through underwriters, or, if such
securities are not being sold through underwriters, on the date that the
registration statement with respect to such securities becomes effective,
(i) an opinion, dated such date, of the counsel representing the Company
for the purposes of such registration, in form and substance as is
customarily given to underwriters in an underwritten public offering,
addressed to the underwriters, if any, and to the Holders requesting
registration of Registrable Securities and (ii) a letter, dated such date,
from the independent certified public accountants of the Company, in form
and substance as is customarily given by independent certified public
accountants to underwriters in an underwritten public offering, addressed
to the underwriters, if any, and to the Holders requesting registration of
Registrable Securities; such a letter to the Holders shall be paid by the
Holders.
9.3 FURNISH INFORMATION. It shall be a condition precedent to the
obligations of the Company to take any action pursuant to Sections 9.2 or
9.6 hereof that the selling Holders shall furnish to the Company such
information regarding themselves, the Registrable Securities held by them,
and the intended method of disposition of such securities as shall be
reasonably required to effect the registration of their Registrable
Securities.
9.4 INDEMNIFICATION. In the event any Registrable Securities are
included in a registration statement under this Section 9:
(a) To the extent permitted by law, the Company will
indemnify and hold harmless each Holder, the officers, directors and
employees or partners of each Holder, any underwriter (as defined in the
Act) for such Holder and each person, if any who controls such Holder or
underwriter within the meaning of the Act or the Securities Exchange Act
of 1934, as amended (the 111934 Act"), against any losses, claims, damages
or liabilities (joint or several) to which they may become subject,
regardless of the legal theory upon which the same may be based, under the
Act, the 1934 Act or other federal or state law, insofar as such losses,
claims, damages, or liabilities (or actions in respect thereof) arise out
of or are based upon any of the following statements, omissions or
violations (collectively, a "Violation"): (i) any untrue statement or
alleged untrue statement of a material fact contained in such registration
statement, including any preliminary prospectus or final prospectus
contained therein or any amendments or supplements thereto, (ii) the
omission or alleged omission to state therein a material fact required to
be stated therein, or necessary to make the statements therein not
misleading, or (iii) any violation or alleged violation by the Company of
the Act, the 1934 Act, any state securities law or any rule or regulation
promulgated under the Act, the 1934 Act or any state securities law; and
the Company will reimburse each such Holder, officer or director or
partner, underwriter or controlling person for any legal or other expenses
reasonably incurred by them in connection with investigating or defending
any such loss, claim, damage, liability, or action; provided, HOWEVER,
that the indemnity agreement contained in this Section 9.4(a) shall not
apply to amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the consent of
the Company (which consent shall not be unreasonably withheld), nor shall
the Company be liable in any such case for any such loss, claim, damage,
liability or action to the extent that it arises out of or is based upon
a Violation which occurs in reliance upon and in conformity with written
information furnished expressly for use in connection with such
registration by any such Holder, underwriter or controlling person.
(b) To the extent permitted by law, each selling Holder will
indemnify and hold harmless the Company, each of its directors, each of
its officers who have signed the registration statement, each person, if
any, who controls the Company within the meaning of the Act, any
underwriter and any other Holder selling securities in such registration
statement or any of its directors or officers or partners or any person
who controls such Holder, against any losses, claims, damages, or
liabilities (joint or several) to which the Company or any such director,
officer, controlling person, or underwriter or controlling person or other
such Holder or director, officer or partner or controlling person may
become subject, regardless of the legal theory upon which the same may be
based, under the Act, the 1934 Act or other federal or state law, insofar
as such losses, claims, damages, or liabilities (or actions in respect
thereto) arise out of or are based upon any Violation, in each case to the
extent (and only to the extent) that such Violation occurs in reliance
upon and in conformity with written information furnished by such Holder
expressly for use in connection with such registration; and each such
Holder will reimburse any legal or other expenses reasonably incurred by
the Company or any such director, officer, controlling person, underwriter
or controlling person, other Holder, officer, director or partner, or
controlling person in connection with investigating or defending any such
loss, claim, damage, liability or action;
PROVIDED, however, that the indemnity agreement contained in this
Section 9.4(b) shall be limited to an amount equal to the gross proceeds
to each Holder of shares sold pursuant to the registration statement to
which such loss, claim, damage, liability or action relates and shall not
apply to amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the consent of
the Holder, officer, director, partner, which consent shall not be
unreasonably withheld.
(c) Promptly after receipt by an indemnified party under
this Section 9.4 of notice of the commencement of any action (including
any governmental action), such indemnified party will, if a claim in
respect thereof is to be made against any indemnifying party under this
Section 9.4, deliver to the indemnifying party a written notice of the
commencement thereof and the indemnifying party shall have the right to
participate in, and, to the extent the indemnifying party so desires,
Jointly with any other indemnifying party similarly noticed, to assume the
defense thereof with counsel selected by it and reasonably satisfactory to
the other party; PROVIDED, however,. that an indemnified party shall have
the right to retain its own counsel, with the fees and expenses to be paid
by the indemnifying party, if representation of such indemnified party by
the counsel retained by the indemnifying party would be inappropriate due
to actual or potential differing interests between such indemnified party
and any other party represented by such counsel in such proceeding. The
failure to deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action, if prejudicial to
its ability to defend such action, shall relieve such indemnifying party
of any liability to the indemnified party under this Section 9.4, but the
omission so to deliver written notice to the indemnifying party will not
relieve it of any liability that it may have to any indemnified party
otherwise than under this Section 9.4.
9.5 REPORTS UNDER SECURITIES EXCHANGE ACT OF 1934. With a view to
making available to the Holders the benefits of Rule 144 promulgated under
the Act and any other rule or regulation of the SEC that may at any time
permit a Holder to sell securities of the Company to the public without
registration or pursuant to a registration on Form S-3, the Company agrees
to:
(a) make and keep public information available, as those
terms are understood and defined in SEC Rule 144;
(b) file with the SEC in a timely manner all reports and
other documents required of the Company under the Act and the 1934 Act;
and
(c) furnish to any Holder, so long as the Holder owns any
Registrable Securities, forthwith upon request (i) a written statement by
the Company that it has complied with the reporting requirements of SEC
Rule 144 the Act and the 1934 Act or that it qualifies as a registrant
whose securities may be resold pursuant to Form S-3 (at any time after it
so qualifies), (ii) a copy of the most recent annual or quarterly report
of the Company and such other reports and documents so filed by the
Company, and (iii) such other information as may be reasonably requested
in availing any Holder of any rule or regulation of the SEC which permits
the selling of any such securities without registration or pursuant to
such form.
9.6 FORM S-3 REGISTRATION. In case the Company shall receive from
any Holder or Holders a written request or requests that the Company
effect a registration on Form S-3 and any related qualification or
compliance with respect to all or a part of the Registrable Securities
owned by such Holder or Holders, the Company will:
(a) promptly give written notice of the proposed
registration, and any related qualification or compliance, to all other
Holders; and
(b) as soon as practicable, effect such registration and all
such qualifications and compliances as may be so requested and as would
permit or facilitate the sale and distribution of all or such portion of
such Holder' s or Holders, Registrable Securities as are specified in such
request, together with all or such portion of the Registrable Securities
of any other Holder or Holders joining in such request as are specified in
a written request given within twenty (20) days after receipt of such
written notice from the Company; PROVIDED, HOWEVER, that the Company shall
not be obligated to effect any such registration, qualification or
compliance, pursuant to this Section 9.6: (1) if Form S-3 is not available
for such offering by the Holders; (2) if the Holders, together with the
holders of any other securities of the Company entitled to inclusion in
such registration, propose to sell Registrable Securities and such other
securities (if any) at an aggregate price to the public (net of any
underwriters' discounts or commissions) of less than $250,000; (3) if the
Company shall furnish to the Holders a certificate signed by the President
of the Company stating that in the good faith judgment of the Board of
Directors of the Company, it would be seriously detrimental to the Company
and its shareholders for such Form S-3 Registration to be effected at such
time, in which event the Company shall have the right to defer the filing
of the Form S-3 registration statement for a period of not more than sixty
(60) days after receipt of the request of the Holder or Holders under this
Section 9.6; PROVIDED, further, however, that the Company shall not
utilize this right more than once in any twelve-month period; (4) if the
Company has within the twelve-month period preceding the date of such
request, already effected two registrations on Form S-3 for the Holders
pursuant to this Section 9.6; or (5) if such registration could be
declared effective within the one hundred twenty (120) day period
following the effective date of any registration effected by the Company
pursuant to the request of stockholders of the Company under this
Section 9.6; or (6) in any particular jurisdiction in which the Company
would be required to qualify to do business or to execute a general
consent to service of process in effecting such registration,
qualification or compliance.
(c) Subject to the foregoing, the Company shall file a
registration statement covering the Registrable Securities and other
securities so requested to be registered as soon as practicable. after
receipt of the request or requests of the Holders. All expenses incurred
in connection with a registration requested pursuant to this Section 9.6,
including without limitation, all registration, filing, qualification,
underwriting discounts and commissions, printer's and accounting fees and
the reasonable fees and disbursements of counsel for the selling Holder or
Holders and counsel for the Company shall be borne pro rata by the selling
Holders; PROVIDED, HOWEVER, that such Holders shall pay an aggregate
amount of such expenses up to $15,000 plus 50% of such expenses in excess
of $15,000 up to a maximum of $30,000; and the Company shall pay all other
such expenses.
9.7 ASSIGNMENT OF REGISTRATION RIGHTS. The rights to cause the
Company to register Registrable Securities pursuant to this Section 9 may
be assigned by a Holder to a transferee or assignee of such securities;
PROVIDED that the same number of such Holders, shares relating to the
rights being so transferred shall also be transferred to such assignee;
and the Company is, within a reasonable time after such transfer,
furnished with written notice of the name and address of such transferee
or assignee and the securities with respect to which such registration
rights are being assigned; and provided, further, that such assignment
shall be effective only if immediately following such transfer the further
disposition of such securities by the transferee or assignee is restricted
under the Act.
9.8 NO CONFLICTING AGREEMENTS. The Company represents and
warrants to the Holders that the Company is not a party to any agreement
that conflicts in any manner with the Holders, rights to cause the Company
to register Registrable Securities pursuant to this Section 9. The
Company covenants and agrees that it shall not, without the prior written
consent of the Holders of a majority of the outstanding Registrable
Securities, enter into any agreement with any holder or prospective holder
of any securities of the Company that would allow such holder to include
such securities in any registration if the inclusion of such holder's
securities would reduce on other than a pro-rata basis (based on the
number of shares owned) the amount of the Registrable Securities of the
holders that may be included in such registration.
9.9 RIGHTS AND OBLIGATIONS SURVIVE EXERCISE AND EXPIRATION OF
WARRANTS. The rights and obligations of the Company, of the Holder of
this Warrant and of the Holder of shares of Common Stock issued upon
exercise or conversion of this Warrant, contained in this Section 9 shall
survive the exercise, the conversion and the expiration of this Warrant,
provided that the term of the registration rights shall survive for a
period of ten (10) years from the Date of Grant.
