Warrant No. __
WARRANT TO PURCHASE A MAXIMUM OF
_________ SHARES OF COMMON STOCK OF
NEUROBIOLOGICAL TECHNOLOGIES, INC.
(Void after April 14, 2004)
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE
ABSENCE OF A REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES
UNDER SUCH ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144 OF SUCH ACT.
THIS WARRANT AND THE SHARES PURCHASABLE HEREUNDER ARE SUBJECT TO RESTRICTIONS ON
TRANSFER AS SET FORTH HEREIN.
This certifies that _____________ (the "Holder"), or assigns, for value
received, is entitled to purchase from Neurobiological Technologies, Inc., a
Delaware corporation (the "Company"), subject to the terms set forth below, a
maximum of __________ fully paid and nonassessable shares (subject to adjustment
as provided herein) of the Company's Common Stock (the "Warrant Shares") for
cash at a price of $1.00 per share (the "Exercise Price") (subject to adjustment
as provided herein) at any time or from time to time up to and including 5:00
p.m. (California Time) on April 14, 2004, (the "Expiration Date") upon surrender
to the Company at its principal office (or at such other location as the Company
may advise the Holder in writing) of this Warrant properly endorsed with the
Form of Subscription attached hereto duly filled in and signed and upon payment
in cash or by check of the aggregate Exercise Price for the number of shares for
which this Warrant is being exercised determined in accordance with the
provisions hereof. The Exercise Price is subject to adjustment as provided in
Section 3 of this Warrant. This Warrant is issued subject to the following terms
and conditions:
1. Exercise, Issuance of Certificates, Reduction in Number of Warrant
Shares.
1.1 General. This Warrant is exercisable at the option of the
Holder of record hereof on or prior to the Expiration Date, at any time or from
time to time following its issuance, for all or any part of the Warrant Shares
(but not for a fraction of a share) which may be purchased hereunder, as that
number may be adjusted pursuant to Section 3 of this Warrant. The Company agrees
that the Warrant Shares purchased under this Warrant shall be and are deemed to
be issued to the Holder hereof as the record owner of such Warrant Shares as of
the close of business on the date on which this
Warrant shall have been surrendered, properly endorsed, the completed and
executed Form of Subscription delivered, and payment made for such Warrant
Shares. Certificates for the Warrant Shares so purchased, together with any
other securities or property to which the Holder hereof is entitled upon such
exercise, shall be delivered to the Holder hereof by the Company at the
Company's expense not later than 10 days after the rights represented by this
Warrant have been so exercised. In case of a purchase of less than all the
Warrant Shares which may be purchased under this Warrant, the Company shall
cancel this Warrant and execute and deliver to the Holder hereof within a
reasonable time a new Warrant or Warrants of like tenor for the balance of the
Warrant Shares purchasable under the Warrant surrendered upon such purchase.
Each stock certificate so delivered shall be registered in the name of such
Holder.
1.2 Net Issue Exercise of Warrant. Notwithstanding any
provisions herein to the contrary, if the fair market value of one share of
Common Stock is greater than the Exercise Price (at the date of calculation as
set forth below), in lieu of exercising this Warrant for cash, Holder may elect
to receive shares of Common Stock equal to the value (as determined below) of
this Warrant (or the portion thereof being canceled) by surrender of this
Warrant at the principal office of the Company together with the properly
endorsed Form of Subscription in which event the Company shall issue to the
Holder a number of shares of Common Stock computed using the following formula:
X= Y (A-B)
A
Where X= the number of shares of Common Stock to be
issued to Holder;
Y= the number of shares of Common Stock
purchasable under the Warrant or, if only a
portion of the Warrant is being exercised,
the portion of the Warrant being canceled
(at the date of such calculation);
A= the fair market value of one share of the
Company's Common Stock (at the date of such
calculation); and
B= Exercise Price (as adjusted to the date of
such calculation).
For purposes of the above calculation, the fair market value of one share of
Common Stock shall be the average of the closing bid and asked prices of the
Common Stock quoted in the over-the-counter market summary or the last reported
sale price of the Common Stock or the closing price quoted on the Nasdaq
National Market System or on any exchange on which the Common Stock is listed,
whichever is applicable, as
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published in The Wall Street Journal for the five trading days prior to the date
of determination of fair market value.
2. Shares to be Fully Paid. The Company covenants and agrees that all
Warrant Shares, will, upon issuance and, if applicable, payment of the
applicable Exercise Price, be duly authorized, validly issued, fully paid and
nonassessable, and free of all liens and encumbrances, except for restrictions
on transfer provided for herein or under applicable federal and state securities
laws.
3. Adjustment of Exercise Price and Number of Shares. The Exercise
Price and the total number of Warrant Shares shall be subject to adjustment from
time to time upon the occurrence of certain events described in this Section 3.
Upon each adjustment of the Exercise Price, the Holder of this Warrant shall
thereafter be entitled to purchase, at the Exercise Price resulting from such
adjustment, the number of shares obtained by multiplying the Exercise Price in
effect immediately prior to such adjustment by the number of shares purchasable
pursuant hereto immediately prior to such adjustment, and dividing the product
thereof by the Exercise Price resulting from such adjustment.
3.1 Subdivision or Combination of Stock. In case the Company
shall at any time subdivide its outstanding shares of Common Stock into a
greater number of shares, the Exercise Price in effect immediately prior to such
subdivision shall be proportionately reduced and the number of Warrant Shares
issuable hereunder proportionately increased, and conversely, in case the
outstanding shares of the Common Stock of the Company shall be combined into a
smaller number of shares, the Exercise Price in effect immediately prior to such
combination shall be proportionately increased and the number of Warrant Shares
issuable hereunder proportionately decreased.
3.2 Reclassification. If any reclassification of the capital
stock of the Company or any reorganization, consolidation, merger, or any sale,
lease, license, exchange or other transfer (in one transaction or a series of
related transactions) of all or substantially all, of the business and/or assets
of the Company (the "Reclassification Events") shall be effected in such a way
that holders of Common Stock shall be entitled to receive stock, securities, or
other assets or property, then, as a condition of such Reclassification Event
lawful and adequate provisions shall be made whereby the Holder hereof shall
thereafter have the right to purchase and receive (in lieu of the shares of
Common Stock of the Company immediately theretofore purchasable and receivable
upon the exercise of the rights represented hereby) such shares of stock,
securities, or other assets or property as may be issued or payable with respect
to or in exchange for a number of outstanding shares of such Common Stock equal
to the number of shares of such stock immediately theretofore purchasable and
receivable upon the exercise of the rights represented hereby. In any
Reclassification Event, appropriate provision shall be
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made with respect to the rights and interests of the Holder of this Warrant to
the end that the provisions hereof (including, without limitation, provisions
for adjustments of the Exercise Price and of the number of Warrant Shares),
shall thereafter be applicable, as nearly as may be, in relation to any shares
of stock, securities, or assets thereafter deliverable upon the exercise hereof.
3.3 Notice of Adjustment. Upon any adjustment of the Exercise
Price or any increase or decrease in the number of Warrant Shares, the Company
shall give written notice thereof, by first class mail postage, prepaid,
addressed to the registered Holder of this Warrant at the address of such Holder
as shown on the books of the Company. The notice shall be prepared and signed by
the Company's Chief Financial Officer and shall state the Exercise Price
resulting from such adjustment and the increase or decrease, if any, in the
number of shares purchasable at such price upon the exercise of this Warrant,
setting forth in reasonable detail the method of calculation and the facts upon
which such calculation is based.
4. No Voting or Dividend Rights. Nothing contained in this Warrant
shall be construed as conferring upon the holder hereof the right to vote or to
consent to receive notice as a shareholder of the Company on any other matters
or any rights whatsoever as a shareholder of the Company. No dividends or
interest shall be payable or accrued in respect of this Warrant or the interest
represented hereby or the shares purchasable hereunder until, and only to the
extent that, this Warrant shall have been exercised.
5. Compliance with Securities Act; Transferability of Warrant;
Disposition of Shares of Stock.
5.1 Compliance with Securities Act. The Holder of this
Warrant, by acceptance hereof, agrees that this Warrant and the Warrant Shares
to be issued upon exercise hereof are being acquired for investment and that it
will not offer, sell, or otherwise dispose of this Warrant or any Warrant Shares
except under circumstances which will not result in a violation of the
Securities Act of 1933, as amended (the "Act") or any applicable state
securities laws. The Holder agrees that the Company is under no obligation to
register the Warrants and the Warrant Shares, and Xxxxxx acknowledges that the
Company does not intend to cause such a registration. This Warrant and all
Warrant Shares shall be stamped or imprinted with a legend in substantially the
following form:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED OR THE SECURITIES OR BLUE SKY LAWS OF
ANY STATE. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, OR
HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT IN
EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT OR AN
OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE
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COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED, OR UNLESS SOLD
PURSUANT TO RULE 144 OF SUCH ACT.
5.2 Access to Information; Pre Existing Relationship. Xxxxxx
has had the opportunity to ask questions of, and to receive answers from,
appropriate executive officers of the Company with respect to the terms and
conditions of the transactions contemplated hereby and with respect to the
business, affairs, financial condition and results of operations of the Company.
Xxxxxx has had access to such financial and other information as is necessary in
order for Holder to make a fully informed decision as to investment in the
Company, and has had the opportunity to obtain any additional information
necessary to verify any of such information to which Xxxxxx has had access.
Holder further represents and warrants that he has either (i) a pre-existing
relationship with the Company or one or more of its officers or directors
consisting of personal or business contacts of a nature and duration which
enable him to be aware of the character, business acumen and general business
and financial circumstances of the Company or the officer or director with whom
such relationship exists or (ii) such business or financial expertise as to be
able to protect his own interests in connection with the purchase of the Shares.
5.3 Warrant Transferable. Subject to compliance with
applicable federal and state securities laws under which this Warrant was
purchased, this Warrant and all rights hereunder are transferable, in whole or
in part, without charge to the Holder (except for transfer taxes), upon
surrender of this Warrant properly endorsed; provided, however, that the Holder
shall notify the Company in writing in advance of any proposed transfer and
shall not transfer this Warrant or any rights hereunder to any person or entity
which is then engaged in a business that in the reasonable judgment of the
Company is in direct competition with the Company.
5.4 Disposition of Warrant Shares and Common Stock. With
respect to any offer, sale, or other disposition of the Warrant or any Warrant
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 Xxxxxx'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 such Warrant or
Warrant Shares, as the case may be, and indicating whether or not under the Act
certificates for such Warrant or Warrant Shares to be sold or otherwise disposed
of require any restrictive legend as to applicable restrictions on
transferability in order to insure compliance with the Act. Promptly upon
receiving such written notice and opinion, the Company, as promptly as
practicable, shall notify such Holder that such Holder may sell or otherwise
dispose of such Warrant or Warrant Shares, all in accordance with the terms of
the notice delivered to the Company. If a determination has
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been made pursuant to this Section 5.4 that the opinion of the 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, such Warrant or Warrant Shares may 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 request to provide reasonable assurance that the provisions of Rule
144 have been satisfied. Each certificate representing the Warrant or Warrant
Shares 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 the Act, unless in the aforesaid opinion of counsel for the
Holder, such legend is not required in order to ensure compliance with the Act.
The Company may issue stop transfer instructions to its transfer agent in
connection with such restrictions.
6. 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.
7. Notices. Any notice, request, 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 mail, postage prepaid, to each such
Holder at its address as shown on the books of the Company or to the Company at
the address indicated therefor in the first paragraph of this Warrant or such
other address as either may from time to time provide to the other.
8. Other Notices. If at any time:
(1) the Company shall declare any cash dividend upon its
Common Stock;
(2) the Company shall declare any dividend upon its Common
Stock payable in stock or make any special dividend or other distribution to the
holders of its Common Stock;
(3) the Company shall offer for subscription pro rata to the
holders of its Common Stock any additional shares of stock of any class or other
rights;
(4) there shall be any capital reorganization or
reclassification of the capital stock of the Company, or consolidation or merger
of the Company with, or sale of all or substantially all of its assets to,
another corporation; or
(5) there shall be a voluntary or involuntary dissolution,
liquidation, or winding-up of the Company;
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then, in any one or more of said cases, the Company shall give, by first class
mail, postage prepaid, addressed to the Holder of this Warrant at the address of
such Holder as shown on the books of the Company, (a) at least 10 days prior
written notice of the date on which the books of the Company shall close or a
record shall be taken for such dividend, distribution, or subscription rights or
for determining rights to vote in respect of any such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation, or
winding-up, and (b) in the case of any such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding-up, at least 10
days' prior written notice of the date when the same shall take place; provided,
however, that the Holder shall make a best efforts attempt to respond to such
notice as early as possible after the receipt thereof. Any notice given in
accordance with the foregoing clause (a) shall also specify, in the case of any
such dividend, distribution, or subscription rights, the date on which the
holders of Common Stock shall be entitled thereto. Any notice given in
accordance with the foregoing clause (b) shall also specify the date on which
the holders of Common Stock shall be entitled to exchange their Common Stock for
securities or other property deliverable upon such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation,
winding-up or conversion, as the case may be.
9. 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.
10. Lost Warrants. The Company represents and warrants to the Holder
hereof that upon receipt of evidence reasonably satisfactory to the Company of
the loss, theft, destruction, or mutilation of this Warrant and, in the case of
any such loss, theft or destruction, upon receipt of an indemnity reasonably
satisfactory to the Company (without the requirement to post bond), or in the
case of any such mutilation upon surrender and cancellation of such Warrant, the
Company, at its expense, will make and deliver a new Warrant, of like tenor, in
lieu of the lost, stolen, destroyed or mutilated Warrant.
11. Fractional Shares. No fractional shares shall be issued upon
exercise of this Warrant. The Company shall, in lieu of issuing any fractional
share, pay the Holder entitled to such fraction a sum in cash equal to such
fraction (calculated to the nearest 1/100th of a share) multiplied by the then
effective Exercise Price on the date the Form of Subscription is received by the
Company.
12. No Impairment. The Company will not, by charter amendment or by
reorganization, transfer of assets, consolidation, merger, dissolution, issue or
sale of securities, or any other voluntary action, avoid or seek to avoid the
observance or
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performance of any 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 against impairment. Upon the request of the Holder, the Company will at
any time during the period this Warrant is outstanding acknowledge in writing,
in form satisfactory to Holder, the continued validity of this Warrant and the
Company's obligations hereunder.
13. Successors and Assigns. This Warrant and the rights evidenced
hereby shall inure to the benefit of and be binding upon the successors of the
Company and the Holder. The provisions of this Warrant are intended to be for
the benefit of all Holders from time to time of this Warrant, and shall be
enforceable by any such Holder.
IN WITNESS WHEREOF, the Company has caused this Warrant to be duly
executed by its officer, thereunto duly authorized as of this 14th day of April,
1999.
NEUROBIOLOGICAL TECHNOLOGIES, INC.
a Delaware corporation
By: _________________________________
Name: _________________________________
Title: _________________________________
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FORM OF SUBSCRIPTION
(To be signed only upon exercise of Warrant)
To: Neurobiological Technologies, Inc.
[Please mark one box]
[ ] The undersigned, the holder of the attached Common Stock Warrant, hereby
irrevocably elects to exercise the purchase right represented by such
Warrant for, and to purchase thereunder, (1) shares of Common Stock of
Neurobiological Technologies, Inc. (the "Company") and herewith makes
payment of $_________ therefor, and requests certificates for such shares
be issued in the name of, and delivered to,
_______________________________ whose address is ________________________
________________________________________________________________________.
[ ] The undersigned, the holder of the attach Common Stock Warrant, hereby
irrevocably elects to exercise the purchase right represented by such
Warrant for, and to purchase thereunder, (1) shares of Common Stock of
the Company and herewith elects to pay for such shares by reducing the
number of shares issuable thereunder in accordance with Section 1.2
thereof. The undersigned hereby authorizes the Company to make the
required calculation under Section 1.2 of the Warrant.
The undersigned represents that it is acquiring such Common Stock for its
own account for investment and not with a view to or for sale in connection with
any distribution thereof.
DATED: ___________, _____
___________________________________________
(Signature must conform in all respects to
name of Xxxxxx as specified on the face of
the Warrant)
Name: _________________________________
Title: _________________________________
(1) Insert here the number of shares called for on the face of the Warrant (or,
in the case of a partial exercise, the portion thereof as to which the
Warrant is being exercised), in either case without making any adjustment
for any stock or other securities or property or cash which, pursuant to
the adjustment provisions of the Warrant, may be deliverable upon exercise.
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