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EXHIBIT 10.5
THIS WARRANT AND THE COMMON STOCK ISSUABLE WITH RESPECT HERETO HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE BLUE
SKY ACTS AND MAY BE TRANSFERRED OR SOLD ONLY PURSUANT TO REGISTRATION UNDER
SUCH ACTS, OR TO EXEMPTIONS THEREUNDER.
ZYMETX, INC.
a Delaware corporation
(the "Company")
May 9, 1996
For the Purchase of_______ Shares of the
Company's Common Stock, $.001 par value
COMMON STOCK PURCHASE WARRANT
NO. ____
This certifies that ___________________, a _____________, or such
person's registered assigns (the "Warrant Holder"), is entitled, subject to the
terms and conditions hereinafter set forth at any time on or before May 9,
2003, to purchase from time to time up to a total of_______________________
(_______) shares of the Company's common stock, $.001 par value (the "Common
Stock"), at a price per share of $.80 (the "Purchase Price"). The number of
shares of Common Stock purchasable under this Common Stock Purchase Warrant
(the "Warrant") and the Purchase Price thereof shall be subject to adjustment
as hereinafter provided.
The Purchase Price shall be payable in cash or by certified or bank
cashier's check in lawful funds of the United States of America or by
cancellation of indebtedness. Upon presentation and surrender of this Warrant,
together with payment of the Purchase Price for the shares of Common Stock
thereby purchased, at the office of the Company's Transfer Agent for the
transfer of such stock or, if at any time there is no such Transfer Agent, at
the principal office of the Company, the Warrant Holder shall be entitled to
receive a certificate or certificates for the shares of Common Stock so
purchased (the "Shares"). All Shares that may be issued upon the exercise of
this Warrant will, upon issuance, be fully paid, nonassessable, and free from
all taxes, liens, and charges with respect thereto.
This Warrant is subject to the following additional terms and
conditions:
1. EXERCISE OF WARRANT.
1.1. At Warrant Holder's Option. This Warrant may be
exercised at any time on or before May 31, 2003 (the "Termination Date"), and
the purchase rights represented hereby are exercisable solely at the Warrant
Holder's option. If the Warrant Holder does not exercise its right to purchase
the number of shares of Common Stock designated herein, this Warrant shall
automatically expire on the Termination Date. In the event the Warrant Holder
purchases less than all the shares
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purchasable under this Warrant, the Company shall cancel this Warrant upon the
surrender hereof and execute and deliver a new Warrant of like tenor for the
balance of the shares purchasable hereunder.
2. ADJUSTMENTS.
2.1. Adjustment to Purchase Price. The Purchase Price of
the Common Stock issuable upon exercise of this Warrant shall be subject to
adjustment, from time to time, as follows:
(i)(A) If the Company shall issue any Additional
Stock (as hereinafter defined) after the date hereof for a consideration (the
"New Consideration") per share less than the Purchase Price for the Common
Stock issuable upon exercise of the Warrant in effect immediately prior to the
issuance of such Additional Stock, the Purchase Price shall be reduced so as to
be equal to such New Consideration.
(B) No adjustment of the Purchase Price for the
Common Stock issuable upon the exercise of this Warrant shall be made in an
amount less than one cent ($.01) per share, and (except to the limited extent
provided for in subparagraphs (i)(E)(y) and (i)(E)(z) of this Section 2.1) no
adjustment of such Purchase Price shall have the effect of increasing the
Purchase Price above the Purchase Price in effect immediately prior to such
adjustment.
(C) In the case of the issuance of Common Stock
for cash, the consideration shall be deemed to be the amount of cash paid
therefor before deducting any reasonable discounts, commissions, or other
expenses allowed, paid, or incurred by the Company for any underwriting or
otherwise in connection with the issuance and sale thereof.
(D) In the case of the issuance of Common Stock
for a consideration in whole or in part other than cash, the consideration
other than cash shall be deemed to be the fair value thereof as determined by
the Company's Board of Directors irrespective of any accounting treatment.
(E) In the case of the issuance of options to
purchase or rights to subscribe for Common Stock, securities that by their
terms are convertible into or exchangeable for Common Stock, or options to
purchase or rights to subscribe for such convertible or exchangeable securities
(which are not excluded from the definition of Additional Stock):
(w) the aggregate maximum number of
shares of Common Stock deliverable upon exercise of such options to
purchase or rights to subscribe for Common Stock shall be deemed to
have been issued at the time such options or rights were issued and
for a consideration equal to the consideration (determined in the
manner provided in subparagraphs (i)(C) and (i)(D) of this Section
2.1), if any, received by the Company upon the issuance of such
options or rights, plus the minimum purchase price provided in such
options or rights for the Common Stock covered thereby;
(x) the aggregate maximum number of
shares of Common Stock deliverable upon conversion of or in exchange
for any such convertible or exchangeable securities or upon the
exercise of options to purchase or rights to subscribe
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for such convertible or exchangeable securities and subsequent
conversion or exchange thereof shall be deemed to have been issued at
the time such convertible or exchangeable securities were issued or
such options or rights were issued and for a consideration equal to
the consideration, if any, received by the Company for any such
convertible or exchangeable securities and related options or rights
(excluding any cash received on account of accrued interest or accrued
dividends), plus the additional consideration, if any, to be received
by the Company upon the conversion or exchange of such securities or
the exercise of any related options or rights (the consideration in
each case to be determined in the manner provided in subparagraphs
(i)(C) and (i)(D) of this Section 2.1);
(y) upon any change in the number of
shares of Common Stock deliverable upon exercise of such options or
rights or conversion of or exchange for such convertible or
exchangeable securities, the Purchase Price as then in effect shall
forthwith be readjusted to such Purchase Price as would have been
obtained had the adjustment made upon the issuance of such options,
rights, or securities not converted prior to such change or options or
rights related to such securities not converted prior to such change
been made upon the basis of such change, but no further adjustment
shall be made for the actual issuance of Common Stock upon the
exercise of any such options or rights or the conversion or exchange
of such securities;
(z) upon the expiration of any such
options or rights, the termination of any such rights to convert or
exchange or the expiration of any options or rights related to such
convertible or exchangeable securities, the Purchase Price shall
forthwith be readjusted to such Purchase Price as would have been
obtained had the adjustment made upon the issuance of such options,
rights, or securities or options or rights related to such securities
been made upon the basis of the issuance of only the number of shares
of Common Stock actually issued upon the exercise of such options or
rights, upon the conversion or exchange of such securities, or upon
the exercise of the options or rights related to such securities.
(ii) "Additional Stock" for purposes of this
Warrant shall mean any shares of the Company's Common Stock issued by the
Company in conjunction with or after the determination of the Purchase Price as
specified hereinabove, other than:
(A) Common Stock issued pursuant to a
transaction described in Section (iii) hereof;
(B) Common Stock issuable or issued to
officers, directors, employees, or consultants of the Company, whether directly
or pursuant to the exercise of options, on terms that have been approved by the
Company's Board of Directors; and
(C) Common Stock issued or issuable upon
conversion of any shares of the Company's outstanding Preferred Stock or upon
exercise of this Warrant or any other stock warrants issued contemporaneously
herewith or issued and outstanding as of the date hereon.
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(iii) If the number of shares of Common Stock
outstanding at any time after the date hereof is increased by a stock dividend
payable in shares of Common Stock or by a subdivision payable in shares of
Common Stock or by a subdivision or split-up of shares of the Company's Common
Stock, then, following the record date fixed for the determination of holders
of Common Stock entitled to receive such stock dividend, subdivision, or
split-up, the Purchase Price for the Common Stock issuable upon the exercise of
this Warrant shall be appropriately decreased so that the number of shares of
Common Stock issuable upon the exercise of this Warrant will be increased in
proportion to such increase in the number of outstanding shares of the
Company's Common Stock.
(iv) If the number of shares of Common Stock
outstanding at any time after the date hereof is decreased by a combination or
reverse stock split of the outstanding shares of the Company's Common Stock,
then, following the record date of such combination or reverse stock split, the
Purchase Price for the Common Stock shall be appropriately increased so that
the number of shares of Common Stock issuable upon the exercise of this Warrant
will be decreased in proportion to such decrease in the number of outstanding
shares of Common Stock.
2.2. Adjustment to Number of Shares Purchasable Under
Warrant. Upon any adjustment to the Purchase Price, the number of shares
purchasable under this Warrant shall be adjusted to equal the product of (i)
the number of shares of Common Stock purchasable under this Warrant immediately
prior to such adjustment to the Purchase Price and (ii) the quotient of (A) the
Purchase Price in effect immediately prior to such adjustment divided by (B)
the Purchase Price in effect immediately after such adjustment.
2.3. Warrant Need Not be Changed to Reflect Adjustments.
This Warrant need not be changed to reflect any adjustment or changes in the
Purchase Price.
2.4. Reorganization, Merger, Etc. If any capital
reorganization or reclassification of the capital stock of the Company, or
consolidation or merger of the Company with another corporation or entity, or
the sale or conveyance of all or substantially all of the Company's assets to
another corporation or entity shall be effected, then, as a condition of such
reorganization, reclassification, consolidation, merger, sale, or conveyance,
lawful and adequate provision shall be made whereby the Warrant Holder shall
thereafter have the right to purchase and receive upon the basis and upon the
terms and conditions specified in this Warrant and in lieu of the shares of
Common Stock immediately theretofore purchasable and receivable upon the
exercise of the rights represented hereby, such shares of stock, securities, or
assets 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 Common Stock immediately theretofore purchasable and receivable upon the
exercise of the rights represented hereby had such reorganization,
reclassification, consolidation, merger, sale, or conveyance not taken place,
and, in any such case, appropriate provision shall be made with respect to the
rights and interests of the Warrant Holder such that the provisions hereof
(including, without limitation, provisions for adjustment of the Purchase
Price) shall thereafter be applicable, as nearly as may be, to any stock,
securities, or assets thereafter deliverable upon the exercise hereof.
The Company shall not effect any consolidation, merger, or sale of all
or substantially all of its assets to any other corporation or entity, unless
prior to or simultaneously with the consummation
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thereof the successor corporation or entity (if other than the Company)
resulting from such consolidation or merger, or the corporation or entity
purchasing such assets, shall assume, by written instrument executed and mailed
or delivered to the Warrant Holder at the address indicated in Section 7
hereof, the obligation of such corporation or entity to deliver to such Warrant
Holder shares of stock, securities, or assets as, in accordance with the
provisions of this Warrant, such Warrant Holder may be entitled to purchase,
and to perform and observe each and every covenant and condition of this
Warrant to be performed and observed by the Company.
2.5. Notice to Warrant Holder or Warrant Holders.
(a) Upon any adjustment of the Purchase Price,
the Company, within thirty (30) days thereafter, shall give written notice
thereof, pursuant to Section 7 hereof, which notice shall state the adjusted
Purchase Price setting forth in reasonable detail the method of calculation and
the facts (including a statement of the consideration received or deemed to
have been received by the Company for any additional shares or convertible or
exchangeable securities or rights or options) upon which such calculations are
based. Where appropriate, such notice may be given in advance and be included
as part of the notice required to be mailed pursuant to the provisions of
paragraph (b) of this Section 2.5.
(b) In case at any time:
(i) the Company shall declare any
dividend upon its Common Stock payable otherwise than in cash or in
the Common Stock of the Company or payable otherwise than out of net
income for a twelve (12) month period ending not earlier than ninety
(90) days prior to the date of payment of such dividend; or
(ii) the Company shall offer for
subscription to the holders of its Common Stock any additional shares
of stock of any class or any other securities convertible into or
exchangeable for shares of stock or any rights or options to subscribe
thereto; or
(iii) there shall be any capital
reorganization or reclassification of the capital stock of the
Company, or a sale or conveyance of all or substantially all of the
assets of the Company, or a consolidation or merger of the Company
with another corporation or entity; or
(iv) there shall be a voluntary or
involuntary dissolution, liquidation, or winding up of the Company; or
(v) the Company intends to issue or has
issued any Common Stock or rights convertible into Common Stock for a
per share consideration of less than the Purchase Price, then, in any
one or more of said cases, the Company shall give written notice,
pursuant to Section 7 hereof, at the earliest time legally practicable
(and, unless otherwise impossible for a legal reason, not less than
thirty (30) days before any record date or other date set for
definitive action) of the date as of which (A) the books of the
Company shall close or a record date shall be taken for such dividend,
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distribution, or subscription rights or options, or (B) such
reorganization, reclassification, sale, conveyance, consolidation,
merger, dissolution, liquidation, or winding up shall take place, as
the case may be. Such notice shall also specify the date as of which
the holders of the Common Stock of record shall participate in said
dividend, distribution, subscription rights, or options or shall be
entitled to exchange their Common Stock for securities or other
property deliverable upon such reorganization, reclassification, sale,
conveyance, consolidation, merger, dissolution, liquidation, or
winding up, as the case may be (on which date, in the event of
voluntary or involuntary dissolution, liquidation, or winding up of
the Company, the right to exercise this Warrant shall cease and
terminate).
2.6. Conditions Not Specifically Covered. In case at any
time conditions shall arise by reason of action taken by the Company, which, in
the good faith judgment of the Company's Board of Directors, are not adequately
covered by the limited antidilution provisions of this Warrant so as to
potentially materially and adversely affect the rights of the Warrant Holder or
Warrant Holders, or, in case at any time any such conditions are expected to
arise by reason of any action contemplated by the Company, its Board of
Directors shall appoint a firm of independent certified public accountants of
recognized standing (which may be the firm that regularly examines the
Company's financial statements), who shall give an opinion as to the
adjustment, if any (not inconsistent with the standards established in this
Section 2 hereof), of the Purchase Price, which is, or would be, required to
preserve, without dilution, the rights of the Warrant Holder or Warrant Holders
to the extent provided herein. The Company's Board of Directors shall make the
adjustment recommended forthwith upon the receipt of such opinion or the taking
of any such action contemplated, as the case may be.
3. STATUS OF WARRANT HOLDERS. This Warrant does not entitle the
Warrant Holder or Warrant Holders hereof to any rights as a shareholder of the
Company.
4. REMEDIES. The Company stipulates that the remedies at law of
the Warrant Holder or Warrant Holders in the event of any default or threatened
default by the Company in the performance of or compliance with any of the
terms of this Warrant are not and will not be adequate, and that such terms may
be specifically enforced by a decree for the specific performance of any
agreement contained herein or by an injunction against a violation of any of
the terms hereof or otherwise.
5. RESERVATION OF SHARES. The Company shall reserve and keep
available a sufficient number of shares of Common Stock to satisfy the
requirements of this Warrant. Before taking any action that would cause a
reduction of the Purchase Price below the then current par value of the shares
of Common Stock issuable upon exercise of this Warrant, the Company will take
any corporate action that may, in the opinion of its counsel, be necessary in
order that the Company may validly and legally issue fully paid and
nonassessable shares of such Common Stock at such adjusted Purchase Price.
6. ASSIGNMENT. This Warrant shall be binding upon and inure to
the benefit of the Company, the Warrant Holder, and their respective successors
and assigns.
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7. NOTICES. All notices, requests, consents, and other
communications hereunder shall be in writing and shall be deemed to have been
given when personally delivered, mailed first class (postage prepaid), or
delivered to a telegraph office:
(i) if to a Warrant Holder, at the address of such
Warrant Holder as shown on the books of the Company.
(ii) if to the Company, at 000 X.X. 00xx Xxxxxx, Xxxxxxxx
Xxxx, Xxxxxxxx 00000, to the attention of the corporate Secretary, or
at such other address as may have been furnished to the Warrant Holder
in writing.
8. HEADINGS. The headings of the Sections and subsections of
this Warrant are inserted for convenience only and shall not be deemed to
constitute a part of this Warrant.
IN WITNESS WHEREOF, this Warrant has been duly executed by its duly
authorized officer as of the date first above written.
ZYMETX, INC.
a Delaware corporation
By:
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Xxxxx X. Xxxxxxxxxx, President
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