Form of Warrant THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUED UPON ITS EXERCISE ARE SUBJECT TO THE RESTRICTIONS ON TRANSFER SET FORTH IN SECTION 4 OF THIS WARRANT
Exhibit
4.1
Form
of Common Stock Warrant
Form
of Warrant
THIS
WARRANT AND THE SHARES OF COMMON STOCK ISSUED UPON ITS
EXERCISE
ARE SUBJECT TO THE RESTRICTIONS ON
TRANSFER
SET FORTH IN SECTION 4 OF THIS
WARRANT
Warrant
No. 2007-
|
Number
of Shares:
(subject
to adjustment)
|
Date
of Issuance: September , 2007
Original
Issue Date (as defined in subsection 2(a)): September ,
2007
|
Genelabs
Technologies, Inc.
Common
Stock Purchase Warrant
(Void
after ,
2012)
Genelabs
Technologies, Inc., a California corporation (the “Company”), for value
received, hereby certifies
that ,
or its registered assigns (the “Registered Holder”), is entitled, subject to the
terms and conditions set forth below, to purchase from the Company, at any
time
or from time to time on or after the Original Issue Date and on or before
the
earlier to occur of (i) 5:00 p.m. (Eastern time) on
,
2012 and (ii) an Acquisition Event (the “Exercise Period”),
shares of Common Stock, no par value per share, of the Company (“Common Stock”),
at a purchase price of $
per
share (subject to the survivability and succession provisions of Section
2(d)).
The shares purchasable upon exercise of this Warrant, and the purchase price
per
share, each as adjusted from time to time pursuant to the provisions of this
Warrant, are hereinafter referred to as the “Warrant Shares” and the “Purchase
Price,” respectively. This Warrant is one of a series of Warrants to purchase
Common Stock (this “Warrant”
and
collectively, the “Company Warrants”) issued pursuant to that certain
Subscription Agreement, dated as of September
, 2007, by and among the Company and
the Registered Holder (the “Subscription
Agreement”)
pursuant to the Company’s Registration Statement on Form S-3 (File number
333-145497) (the “Registration Statement”). An “Acquisition Event” shall mean
the occurrence, in a single transaction or in a series of related transactions,
of any one or more of the following events: (i) a sale or other disposition
of
all or substantially all, of the consolidated assets of the Company; (ii)
a sale
or other disposition of at least ninety percent (90%) of the outstanding
securities of the Company; (iii) the consummation of a merger, consolidation
or
similar transaction (with an unaffiliated entity) following which the Company
is
not the surviving corporation; or (iv) the consummation of a merger,
consolidation or similar transaction (with an unaffiliated entity) following
which the Company is the surviving corporation but the shares of Common Stock
outstanding immediately preceding the merger, consolidation or similar
transaction are converted or exchanged by virtue of the merger, consolidation
or
similar transaction into other property, whether in the form of securities,
cash
or otherwise.
1.
|
Exercise.
|
(a) Exercise
for Cash.
The
Registered Holder may, at its option, elect to exercise this Warrant, in whole
or in part and at any time or from time to time during the Exercise Period,
by
surrendering this Warrant, with the purchase form appended hereto as
Exhibit I
duly
executed by or on behalf of the Registered Holder, at the principal office
of
the Company, or at such other office or agency as the Company may designate,
accompanied by payment in full, in lawful money of the United States, of the
Purchase Price payable in respect of the number of Warrant Shares purchased
upon
such exercise. A facsimile signature of the Registered Holder on the purchase
form shall be sufficient for purposes of exercising this Warrant, provided
that
the Company receives the Registered Xxxxxx’s original signature with three (3)
business days thereafter.
(b) Cashless
Exercise.
At
any
time during the Exercise Period, the Registered Holder may, at its option,
elect
to exercise this Warrant, in whole or in part, on a cashless basis, by
surrendering this Warrant, with the purchase form appended hereto as
Exhibit
I
duly
executed by or on behalf of the Registered Holder, at the principal office
of
the Company, or at such other office or agency as the Company may designate,
by
canceling a portion of this Warrant in payment of the Purchase Price payable
in
respect of the number of Warrant Shares purchased upon such exercise. In the
event of an exercise pursuant to this subsection 1(b), the number of Warrant
Shares issued to the Registered Holder shall be determined according to the
following formula:
X
=
Y(A-B)
A
The
Fair
Market Value per share of Common Stock shall be determined as
follows:
(1) If
the
Common Stock is listed on a national securities exchange, the Nasdaq Global
Market, the Nasdaq Capital Market or another nationally recognized trading
system as of the Exercise Date, the Fair Market Value per share of Common Stock
shall be deemed to be the average of the high and low reported sale prices
per
share of Common Stock thereon on the trading day immediately preceding the
Exercise Date (provided
that if
no such price is reported on such day, the Fair Market Value per share of Common
Stock shall be determined pursuant to clause (2) below).
-2-
(2) If
the
Common Stock is not listed on a national securities exchange, the Nasdaq Global
Market, the Nasdaq Capital Market or another nationally recognized trading
system as of the Exercise Date, the Fair Market Value per share of Common Stock
shall be deemed to be the amount most recently determined in good faith by
the
Board of Directors of the Company (the “Board”) to represent the fair market
value per share of the Common Stock (including without limitation a
determination for purposes of granting Common Stock options or issuing Common
Stock under any plan, agreement or arrangement with employees of the Company);
and, upon request of the Registered Holder, the Board (or a representative
thereof) shall, as promptly as reasonably practicable but in any event not
later
than 10 days after such request, notify the Registered Holder of the Fair Market
Value per share of Common Stock and furnish the Registered Holder with
reasonable documentation of the Board’s determination of such Fair Market Value.
Notwithstanding the foregoing, if the Board has not made such a determination
within the three-month period prior to the Exercise Date, then (A) the
Board shall make, and shall provide or cause to be provided to the Registered
Holder notice of, a determination of the Fair Market Value per share of the
Common Stock within 15 days of a request by the Registered Holder that it do
so,
and (B) the exercise of this Warrant pursuant to this subsection 1(b) shall
be delayed until such determination is made and notice thereof is provided
to
the Registered Holder.
(c) Exercise
Date.
Each
exercise of this Warrant shall be deemed to have been effected immediately
prior
to the close of business on the day on which this Warrant shall have been
surrendered to the Company together with the duly executed purchase form as
provided in subsection 1(a) or 1(b) above (the “Exercise Date”). At such time,
the person or persons in whose name or names any certificates for Warrant Shares
shall be issuable upon such exercise as provided in subsection 1(d) below shall
be deemed to have become the holder or holders of record of the Warrant Shares
represented by such certificates.
(d) Issuance
of Certificates.
As soon
as practicable after the exercise of this Warrant in whole or in part, and
in
any event within 3 trading days thereafter, the Company, at its expense, will
cause to be issued in the name of, and sent for delivery to, the Registered
Holder, or as the Registered Holder (upon payment by the Registered Holder
of
any applicable transfer taxes) may direct:
(i) a
certificate or certificates for the number of full Warrant Shares to which
the
Registered Holder shall be entitled upon such exercise plus, in lieu of any
fractional share to which the Registered Holder would otherwise be entitled,
cash in an amount determined pursuant to Section 3 hereof; and
(ii) in
case
such exercise is in part only, a new warrant or warrants (dated the date hereof)
of like tenor, calling in the aggregate on the face or faces thereof for the
number of Warrant Shares equal (without giving effect to any adjustment therein)
to the number of such shares called for on the face of this Warrant minus the
number of Warrant Shares for which this Warrant was so exercised (which, in
the
case of an exercise pursuant to subsection 1(b), shall include both the number
of Warrant Shares issued to the Registered Holder pursuant to such partial
exercise and the number of Warrant Shares subject to the portion of the Warrant
being cancelled in payment of the Purchase Price).
-3-
(e) Alternative
to the Issuance of Certificates.
If so
requested by the Registered Holder, provided that the transfer agent is
participating in the Depository Trust Company (“DTC”) Fast Automated Securities
Transfer Program, on or before the third (3rd)
business day following the Exercise Date, the Company shall credit such
aggregate number of Warrant Shares to which the Registered Holder is entitled
pursuant to such exercise to the Registered Holder’s or its designee’s balance
account with DTC through its Deposit Withdrawal Agent Commission system.
(f)
Limitation
on Exercise.
Notwithstanding anything to the contrary set forth in this Warrant, at no time
may a Registered Holder of this Warrant exercise any portion of this Warrant
if
the number of shares of Common Stock to be issued pursuant to such exercise
would exceed, when aggregated with all other shares of Common Stock beneficially
owned by such Registered Holder at such time, the number of shares of Common
Stock which would result in such Registered Holder beneficially owning (as
determined in accordance with Section 13(d) of the Exchange Act and the rules
thereunder) in excess of 4.99% of the then issued and outstanding shares of
Common Stock; provided, however, that upon a Registered Holder of this Warrant
providing the Company with sixty-one (61) days notice (pursuant to Section
9
hereof) (the “Waiver Notice”) that such Registered Holder would like to waive
this Section 1(f) with regard to any or all shares of Common Stock issuable
upon
exercise of this Warrant, this Section 1(f) will be of no force or effect with
regard to all or a portion of the Warrant referenced in the Waiver Notice;
provided, further, that the limitation in this Section 1(f) shall be of no
further force or effect during the sixty-one (61) days immediately preceding
the
expiration of the term of this Warrant.
(g)
Company-Elected
Conversion.
(i) The
Company shall provide to the Registered Holder prompt written notice of any
time
that the Company is unable to issue the Warrant Shares via DTC transfer (or
otherwise without restrictive legend), because (A) the Securities and Exchange
Commission (the “Commission”)
has
issued a stop order with respect to the Registration Statement, (B) the
Commission otherwise has suspended or withdrawn the effectiveness of the
Registration Statement, either temporarily or permanently, (C) the Company
has
suspended or withdrawn the effectiveness of the Registration Statement, either
temporarily or permanently, or (D) otherwise (each a “Restrictive
Legend Event”).
To
the extent that a Restrictive Legend Event occurs after the Registered Holder
has exercised this Warrant in accordance with Section 1 but prior to the
delivery of the Warrant Shares, the Company shall (i) if the Fair Market Value
(as defined above) of the Warrant Shares is greater than the Purchase Price,
provide written notice to the Registered Holder that the Company will deliver
that number of Warrant Shares to the Registered Holder as should be delivered
in
a Cashless Exercise in accordance with Section 1(b), and return to the
Registered Holder all consideration paid to the Company in connection with
the
Registered Holder’s attempted exercise of this Warrant pursuant to Section 1(a)
(a “Company-Elected
Conversion”),
or
(ii) at the election of the Registered Holder to be given within five (5) days
of receipt of notice of a Company-Elected Conversion, the Registered Holder
shall be entitled to rescind the previously executed purchase form and the
Company shall return all consideration paid by the Registered Holder for such
shares upon such rescission.
-4-
(ii)
If a
Restrictive Legend Event has occurred and no exemption from the registration
requirements is available (including, without limitation, under Section 3(a)(9)
of the Securities Act of 1933 by virtue of a Cashless Exercise), this Warrant
shall not be exercisable. Notwithstanding anything herein to the contrary,
the
Company shall not be required to make any cash payments to the Registered Holder
in lieu of issuance of the Warrant Shares. The Company shall give prompt written
notice to the Registered Holder of any cessation of a Restrictive Legend Event
(the “Re-Effectiveness
Notice”).
Notwithstanding anything to the contrary contained herein, the expiration of
the
Exercise Period of this Warrant shall be extended for a period of five (5)
days
following receipt by the Registered Holder of the Re-Effectiveness
Notice.
(h) Rule
144.
For
purposes of Rule 144(d) promulgated under the Securities Act of 1933, as in
effect on the date hereof, it is intended that the Warrant Shares issued in
a
Cashless Exercise shall be deemed to have been acquired by the Registered
Holder, and the holding period for the Warrant Shares shall be deemed to have
commenced, on the date this Warrant was originally issued pursuant to the
Subscription Agreement.
(i) Disputes.
In the
case of a dispute as to the determination of the Purchase Price or the
arithmetic calculation of the Warrant Shares, the Company shall promptly issue
to the Registered Holder the number of Warrant Shares that are not
disputed.
2. Adjustments.
(a)
Adjustment
for Stock Splits and Combinations.
If the
Company shall at any time or from time to time after the date on which this
Warrant was first issued (or, if this Warrant was issued upon partial exercise
of, or in replacement of, another warrant of like tenor, then the date on which
such original warrant was first issued) (the “Original Issue Date”) effect a
subdivision of the outstanding Common Stock, the Purchase Price then in effect
immediately before that subdivision shall be proportionately decreased and
the
number of Warrant Shares shall be proportionately adjusted. If the Company
shall
at any time or from time to time after the Original Issue Date combine the
outstanding shares of Common Stock, the Purchase Price then in effect
immediately before the combination shall be proportionately increased and the
number of Warrant Shares shall be proportionately adjusted. Any adjustment
under
this paragraph shall become effective at the close of business on the date
the
subdivision or combination becomes effective.
(b)
Adjustment
for Certain Dividends and Distributions.
In the
event the Company at any time, or from time to time after the Original Issue
Date shall make or issue, or fix a record date for the determination of holders
of Common Stock entitled to receive, a dividend or other distribution payable
in
additional shares of Common Stock, then and in each such event the Purchase
Price then in effect immediately before such event shall be decreased (and
the
number of Warrant Shares shall be proportionately adjusted) as of the time
of
such issuance or, in the event such a record date shall have been fixed, as
of
the close of business on such record date, by multiplying the Purchase Price
then in effect by a fraction:
(1) the
numerator of which shall be the total number of shares of Common Stock issued
and outstanding immediately prior to the time of such issuance or the close
of
business on such record date, and
-5-
(2) the
denominator of which shall be the total number of shares of Common Stock issued
and outstanding immediately prior to the time of such issuance or the close
of
business on such record date plus the number of shares of Common Stock issuable
in payment of such dividend or distribution; provided,
however,
that if
such record date shall have been fixed and such dividend is not fully paid
or if
such distribution is not fully made on the date fixed therefor, the Purchase
Price shall be recomputed accordingly as of the close of business on such record
date and thereafter the Purchase Price shall be adjusted pursuant to this
paragraph as of the time of actual payment of such dividends or
distributions.
(c) Adjustments
for Other Dividends and Distributions.
In the
event the Company at any time or from time to time after the Original Issue
Date
shall make or issue, or fix a record date for the determination of holders
of
Common Stock entitled to receive, a dividend or other distribution payable
in
securities of the Company (other than shares of Common Stock) or in cash or
other property (other than regular cash dividends paid out of earnings or earned
surplus, determined in accordance with generally accepted accounting
principles), then and in each such event provision shall be made so that the
Registered Holder shall receive upon exercise hereof, in addition to the number
of shares of Common Stock issuable hereunder, the kind and amount of securities
of the Company, cash or other property which the Registered Holder would have
been entitled to receive had this Warrant been exercised on the date of such
event and had the Registered Holder thereafter, during the period from the
date
of such event to and including the Exercise Date, retained any such securities
receivable during such period, giving application to all adjustments called
for
during such period under this Section 2 with respect to the rights of the
Registered Holder.
(d) Adjustment
for Reorganization.
If
any
capital reorganization, reclassification of the capital stock of the Company,
consolidation or merger of the Company with another corporation in which the
Company is not the survivor, or sale, transfer or other disposition of all
or
substantially all of the Company’s assets to another corporation shall be
effected, then the Company shall seek to ensure that lawful and adequate
provision shall be made whereby the Registered Holder shall thereafter continue
to have the right to purchase and receive upon the basis and upon the terms
and
conditions herein specified and in lieu of the Warrant Shares issuable upon
exercise of the Warrant held by the Registered Holder, shares of stock in the
surviving or acquiring corporation (“Acquirer”), as the case may be, such that
the aggregate value of the Registered Holder’s warrants to purchase such number
of shares, where the value of each new warrant to purchase one share in the
Acquirer is determined in accordance with the Black-Scholes Option Pricing
formula set forth in Appendix A hereto, is equivalent to the aggregate value
of
the Warrants held by such Registered Holder, where the value of each Warrant
to
purchase one share in the Company is determined in accordance with the
Black-Scholes Option Pricing formula set forth in Appendix B attached hereto.
Furthermore, the new warrants to purchase shares in the Acquirer referred
to herein shall have the same expiration date as the Warrants, and shall have
a
strike price, KAcq,
that is
calculated in accordance with Appendix A hereto.
-6-
Moreover,
appropriate provision shall be made with respect to the rights and interests
of
the Registered Holder to the end that the provisions hereof (including, without
limitation, provision for adjustment of the Purchase Price) shall thereafter
be
applicable, as nearly equivalent as may be practicable in relation to any shares
of stock thereafter deliverable upon the exercise thereof. The Company
shall not effect any such consolidation, merger, sale, transfer or other
disposition unless prior to or simultaneously with the consummation thereof
the
successor corporation (if other than the Company) resulting from such
consolidation or merger, or the corporation purchasing or otherwise acquiring
such assets or other appropriate corporation or entity shall assume by written
instrument, reasonably deemed by the Board of Directors of the Company to be
satisfactory in form and substance, the obligation to deliver to the Registered
Holder, at the last address of the Registered Holder appearing on the books
of
the Company, such shares of stock, as, in accordance with the foregoing
provisions, the Registered Holder may be entitled to purchase, and the other
obligations under these Warrants or otherwise provides for the Warrant as set
forth below. The provisions of this section shall similarly apply to
successive reorganizations, reclassifications, consolidations, mergers, sales,
transfers or other dispositions. If either the Company or the Acquirer
elects not to cause these Warrants to continue in full force and effect until
the expiration of the Exercise Period in connection with any capital
reorganization, reclassification of the capital stock of the Company,
consolidation or merger of the Company with another corporation in which the
Company is not the survivor, or sale, transfer or other disposition of all
or
substantially all of the Company’s assets to another corporation which they are
free to do so for any reason upon notice to the Registered Holder not later
than
30 days after consummation of such reorganization, consolidation, merger, sale,
transfer or disposition, then the Company, or the Acquirer, as the case may
be,
shall pay the Registered Holder in cash an amount per Warrant to purchase one
share in the Company that is calculated in accordance with the Black-Scholes
Option Pricing formula set forth in Appendix B hereto.
(e) Certificate
as to Adjustments.
Upon
the occurrence of each adjustment or readjustment of the Purchase Price pursuant
to this Section 2, the Company at its expense shall, as promptly as reasonably
practicable but in any event not later than 10 days thereafter, compute such
adjustment or readjustment in accordance with the terms hereof and furnish
to
the Registered Holder a certificate setting forth such adjustment or
readjustment (including the kind and amount of securities, cash or other
property for which this Warrant shall be exercisable and the Purchase Price)
and
showing in detail the facts upon which such adjustment or readjustment is based.
The Company shall, as promptly as reasonably practicable after the written
request at any time of the Registered Holder (but in any event not later than
10
days thereafter), furnish or cause to be furnished to the Registered Holder
a
certificate setting forth (i) the Purchase Price then in effect and
(ii) the number of shares of Common Stock and the amount, if any, of other
securities, cash or property which then would be received upon the exercise
of
this Warrant.
3. Fractional
Shares.
The
Company shall not be required upon the exercise of this Warrant to issue any
fractional shares, but shall pay the value thereof to the Registered Holder
in
cash on the basis of the Fair Market Value per share of Common Stock, as
determined pursuant to subsection 2(d) above.
-7-
4. Transfers,
etc.
(a) The
Company will maintain a register containing the name and address of the
Registered Holder of this Warrant. The Registered Holder may change its address
as shown on the warrant register by written notice to the Company requesting
such change.
(b) This
Warrant and all rights hereunder are transferable, in whole or in part, upon
surrender of this Warrant with a properly executed assignment (in the form
of
Exhibit II
hereto)
at the principal office of the Company (or, if another office or agency has
been
designated by the Company for such purpose, then at such other office or
agency).
5. No
Impairment.
The
Company will not, by amendment of its charter or through any 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 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 Registered Holder against impairment.
6. Notices
of Record Date, etc.
In the
event:
(a) the
Company shall take a record of the holders of its Common Stock (or other stock
or securities at the time deliverable upon the exercise of this Warrant) for
the
purpose of entitling or enabling them to receive any dividend or other
distribution, or to receive any right to subscribe for or purchase any shares
of
stock of any class or any other securities, or to receive any other right;
or
(b) of
any
capital reorganization of the Company, any reclassification of the Common Stock
of the Company, any consolidation or merger of the Company with or into another
corporation, including an Acquisition Event, or any transfer of all or
substantially all of the assets of the Company; or
(c) of
the
voluntary or involuntary dissolution, liquidation or winding-up of the Company,
then, and in each such case, the Company will send or cause to be sent to the
Registered Holder a notice specifying, as the case may be, (i) the record date
for such dividend, distribution or right, and the amount and character of such
dividend, distribution or right, or (ii) the effective date on which such
reorganization, reclassification, consolidation, merger, Acquisition Event,
transfer, dissolution, liquidation or winding-up is to take place, and the
time,
if any is to be fixed, as of which the holders of record of Common Stock (or
such other stock or securities at the time deliverable upon the exercise of
this
Warrant) shall be entitled to exchange their shares of Common Stock (or such
other stock or securities) for securities or other property deliverable upon
such reorganization, reclassification, consolidation, merger, transfer,
dissolution, liquidation or winding-up. Such notice shall be sent at least
10
days prior to the record date or effective date for the event specified in
such
notice.
-8-
7. Reservation
of Stock.
The
Company will at all times reserve and keep available, solely for issuance and
delivery upon the exercise of this Warrant, such number of Warrant Shares and
other securities, cash and/or property, as from time to time shall be issuable
upon the exercise of this Warrant.
8. Exchange
or Replacement of Warrants.
(a) Upon
the
surrender by the Registered Holder, properly endorsed, to the Company at the
principal office of the Company, the Company will, subject to the provisions
of
Section 4 hereof, issue and deliver to or upon the order of the Registered
Holder, at the Company’s expense, a new Warrant or Warrants of like tenor, in
the name of the Registered Holder or as the Registered Holder (upon payment
by
the Registered Holder of any applicable transfer taxes) may direct, calling
in
the aggregate on the face or faces thereof for the number of shares of Common
Stock (or other securities, cash and/or property) then issuable upon exercise
of
this Warrant.
(b) Upon
receipt of evidence reasonably satisfactory to the Company of the loss, theft,
destruction or mutilation of this Warrant and (in the case of loss, theft or
destruction) upon delivery of an indemnity agreement (with surety if reasonably
required) in an amount reasonably satisfactory to the Company, or (in the case
of mutilation) upon surrender and cancellation of this Warrant, the Company
will
issue, in lieu thereof, a new Warrant of like tenor.
9. Notices.
All
notices and other communications from the Company to the Registered Holder
in
connection herewith shall be mailed by certified or registered mail, postage
prepaid, or sent via a reputable nationwide overnight courier service
guaranteeing next business day delivery, to the address last furnished to the
Company in writing by the Registered Holder. All notices and other
communications from the Registered Holder to the Company in connection herewith
shall be mailed by certified or registered mail, postage prepaid, or sent via
a
reputable nationwide overnight courier service guaranteeing next business day
delivery, to the Company at its principal office set forth below. If the Company
should at any time change the location of its principal office to a place other
than as set forth below, it shall give prompt written notice to the Registered
Holder and thereafter all references in this Warrant to the location of its
principal office at the particular time shall be as so specified in such notice.
All such notices and communications shall be deemed delivered one business
day
after being sent via a reputable international overnight courier service
guaranteeing next business day delivery.
10. No
Rights as Stockholder.
Until
the exercise of this Warrant, the Registered Holder shall not have or exercise
any rights by virtue hereof as a stockholder of the Company. Notwithstanding
the
foregoing, in the event (i) the Company effects a split of the Common Stock
by means of a stock dividend and the Purchase Price of and the number of Warrant
Shares are adjusted as of the date of the distribution of the dividend (rather
than as of the record date for such dividend), and (ii) the Registered
Holder exercises this Warrant between the record date and the distribution
date
for such stock dividend, the Registered Holder shall be entitled to receive,
on
the distribution date, the stock dividend with respect to the shares of Common
Stock acquired upon such exercise, notwithstanding the fact that such shares
were not outstanding as of the close of business on the record date for such
stock dividend.
-9-
11. Amendment
or Waiver.
Any
term of this Warrant may be amended or waived (either generally or in a
particular instance and either retroactively or prospectively) with the written
consent of the Company and the holders of Company Warrants representing at
least
two-thirds of the number of shares of Common Stock then subject to outstanding
Company Warrants. Notwithstanding the foregoing, (a) this Warrant may be amended
and the observance of any term hereunder may be waived without the written
consent of the Registered Holder only in a manner which applies to all Company
Warrants in the same fashion and (b) the number of Warrant Shares subject to
this Warrant and the Purchase Price of this Warrant may not be amended, and
the
right to exercise this Warrant may not be waived, without the written consent
of
the Registered Holder (it being agreed that an amendment to or waiver under
any
of the provisions of Section 2 of this Warrant shall not be considered an
amendment of the number of Warrant Shares or the Purchase Price). The Company
shall give prompt written notice to the Registered Holder of any amendment
hereof or waiver hereunder that was effected without the Registered Holder’s
written consent. No waivers of any term, condition or provision of this Warrant,
in any one or more instances, shall be deemed to be, or construed as, a further
or continuing waiver of any such term, condition or provision.
12. Section
Headings.
The
section headings in this Warrant are for the convenience of the parties and
in
no way alter, modify, amend, limit or restrict the contractual obligations
of
the parties.
13. Governing
Law.
This
Warrant will be governed by and construed in accordance with the internal laws
of the State of New York (without reference to the conflicts of law provisions
thereof).
14. Facsimile
Signatures.
This
Warrant may be executed by facsimile signature.
*
* * * *
* *
-10-
EXECUTED
as of the Date of Issuance indicated above.
GENELABS TECHNOLOGIES, INC. | ||
|
|
|
By: | ||
Name: |
||
Title: |
ATTEST:
_________________________
APPENDIX
A
Black
Scholes Option Pricing formula to be used when calculating the value of each
new
warrant to purchase one share in the Acquirer shall be:
CAcq
= SAcqe-λ(TAcq-tAcq)N(d1)
- KAcqe-r(TAcq-tAcq)N(d2),
where
CAcq
= value
of
each warrant to purchase one share in the Acquirer
SAcq
= price
of
Acquirer’s stock as determined by reference to the average of the closing prices
on its primary securities exchange over
the
20-day period ending three trading days prior to the closing of the capital
reorganization, reclassification of the capital stock of the Company,
consolidation or merger of the Company with another corporation in which the
Company is not the survivor, or sale, transfer or other disposition of all
or
substantially all of the Company’s assets to another corporation described in
Section 2(d) if the Acquirer’s stock is then traded on such exchange, or the
average of the closing bid or sale prices (whichever is applicable) in the
over-the-counter market over the 20-day period ending three trading days prior
to the closing of the transaction if the Acquirer’s stock is then actively
traded in the over-the-counter market, or the then most recently completed
financing if the Acquirer’s stock is not then traded on a securities exchange or
system or in the over-the-counter market.
TAcq
= expiration
date of new warrants to purchase shares in the Acquirer = TCorp
tAcq
= date
of
issue of new warrants to purchase shares in the Acquirer
TAcq-tAcq
=
time
until warrant expiration, expressed in years
σ
= volatility
= annualized standard deviation of daily log-returns (using a 262-day
annualization factor) of the Acquirer’s stock price on its primary securities
exchange over a 20-day trading period, determined by the Registered Holder,
that
is within the 100-day trading period ending on the trading day immediately
after
the public announcement of the capital reorganization, reclassification of
the
capital stock of the Company, consolidation or merger of the Company with
another corporation in which the Company is not the survivor, or sale, transfer
or other disposition of all or substantially all of the Company’s assets to
another corporation described in Section 2(d) if the Acquirer’s stock is then
traded on such exchange, or the annualized standard deviation of daily-log
returns (using a 262-day annualization factor) of the closing bid or sale prices
(whichever is applicable) in the over-the-counter market over a 20-day trading
period, determined by the Registered Holder, that is within the 100-day trading
period ending on the trading day immediately after the public announcement
of
the transaction if the Acquirer’s stock is then actively traded in the
over-the-counter market, or 0.6 (or 60%) if the Acquirer’s stock is not then
traded on a securities exchange or system or in the over-the-counter market.
N
=
cumulative normal distribution function
d1
=
(ln(SAcq/KAcq)
+ (r-λ+σ2/2)(TAcq-tAcq))
÷ (σ√(TAcq-tAcq))
ln
=
natural logarithm
λ
= dividend
rate of the Acquirer for the most recent 12-month period at the time of closing
of the capital reorganization, reclassification of the capital stock of the
Company, consolidation or merger of the Company with another corporation in
which the Company is not the survivor, or sale, transfer or other disposition
of
all or substantially all of the Company’s assets to another corporation.
KAcq
=
strike
price of
new
warrants to purchase shares in the Acquirer = KCorp
*
(SAcq
/
SCorp)
r
= annual
yield, as reported by Bloomberg at time tAcq,
of the
United States Treasury security measuring the nearest time TAcq
d2
=
d1-
σ√(TAcq-tAcq)
APPENDIX
B
Black
Scholes Option Pricing formula to be used when calculating the value of each
Warrant to purchase one share in the Company shall be:
CCorp
= SCorpe-λ(TCorp-tCorp)N(d1)
- KCorpe-r(TCorp-tCorp)N(d2),
where
CCorp
= value
of
each Warrant to purchase one share in the Company
SCorp
= price
of
Company stock as determined by reference to the average of the closing prices
on
its primary securities exchange over the 20-day period ending three trading
days
prior to the closing of the capital reorganization, reclassification of the
capital stock of the Company, consolidation or merger of the Company with
another corporation in which the Company is not the survivor, or sale, transfer
or other disposition of all or substantially all of the Company’s assets to
another corporation described in Section 2(d) if the Company’s stock is then
traded on such exchange, or the average of the closing bid or sale prices
(whichever is applicable) in the over-the-counter market over the 20-day period
ending three trading days prior to the closing of the transaction if the
Company’s stock is then actively traded in the over-the-counter market, or the
then most recently completed financing if the Company’s stock is not then traded
on a securities exchange or system or in the over-the-counter market.
TCorp
= expiration
date of Warrants to purchase shares in the Company
tCorp
= date
of
public announcement of transaction
TCorp-tCorp
=
time
until Warrant expiration, expressed in years
σ
= volatility
= the annualized standard deviation of daily log-returns (using a 262-day
annualization factor) of the Company’s stock price on the securities exchange or
Nasdaq Global Market over
a
20-day trading period, determined by the Registered Holder, that is within
the
100-day trading period ending on the trading day immediately after the public
announcement of the capital reorganization, reclassification of the capital
stock of the Company, consolidation or merger of the Company with another
corporation in which the Company is not the survivor, or sale, transfer or
other
disposition of all or substantially all of the Company’s assets to another
corporation described in Section 2(d) if the Company’s stock is then traded on
such exchange, or the annualized standard deviation of daily-log returns (using
a 262-day annualization factor) of the closing bid or sale prices (whichever
is
applicable) in the over-the-counter market over a 20-day trading period,
determined by the Registered Holder, that is within the 100-day trading period
ending on the trading day immediately after the public announcement of the
transaction if the Company’s stock is then actively traded in the
over-the-counter market, or 0.6 (or 60%) if the Company’s stock is not then
traded on a securities exchange or system or in the over-the-counter market.
N
=
cumulative normal distribution function
d1
=
(ln(SCorp/KCorp)
+ (r-λ+σ2/2)(TCorp-tCorp))
÷ (σ√(TCorp-tCorp))
ln
=
natural logarithm
λ
= dividend
rate of the Company for the most recent 12-month period at the time of closing
of the capital reorganization, reclassification of the capital stock of the
Company, consolidation or merger of the Company with another corporation in
which the Company is not the survivor, or sale, transfer or other disposition
of
all or substantially all of the Company’s assets to another corporation.
KCorp
=
strike
price of warrant
r
= annual
yield, as reported by Bloomberg at time tCorp,
of the
United States Treasury security measuring the nearest time TCorp
d2
= d1- σ√(TCorp-tCorp)
EXHIBIT
I
PURCHASE
FORM
To:
Genelabs Technologies, Inc.
|
Dated:____________
|
The
undersigned, pursuant to the provisions set forth in the attached Warrant
(No. ___), hereby elects to purchase (check applicable box):
____
shares of the Common Stock of Genelabs Technologies, Inc. covered by such
Warrant; or
____
the
maximum number of shares of Common Stock covered by such Warrant pursuant to
the
cashless exercise procedure set forth in subsection 1(b).
The
undersigned herewith makes payment of the full purchase price for such shares
at
the price per share provided for in such Warrant. Such payment takes the form
of
(check applicable box or boxes):
|
$______
in lawful money of the United States;
and/or
|
|
the
cancellation of such portion of the attached Warrant as is exercisable
for
a total of _____ Warrant Shares (using a Fair Market Value of $_____
per
share for purposes of this calculation) ;
and/or
|
|
the
cancellation of such number of Warrant Shares as is necessary, in
accordance with the formula set forth in subsection 1(b), to exercise
this Warrant with respect to the maximum number of Warrant Shares
purchasable pursuant to the cashless exercise procedure set forth
in
subsection 1(b).
|
|
|
|
Signature: | ||
|
||
Address: | ||
|
||
|
||
EXHIBIT
II
ASSIGNMENT
FORM
FOR
VALUE
RECEIVED, ______________________________________ hereby sells, assigns and
transfers all of the rights of the undersigned under the attached Warrant (No.
____) with respect to the number of shares of Common Stock of Genelabs
Technologies, Inc. covered thereby set forth below, unto:
Name
of Assignee
|
Address
|
No.
of Shares
|
||
Dated:________________
|
Signature:_____________________
|
Signature
Guaranteed:
By:
_______________________
The
signature should be guaranteed by an eligible guarantor institution (banks,
stockbrokers, savings and loan associations and credit unions with membership
in
an approved signature guarantee medallion program) pursuant to Rule 17Ad-15
under the Securities Exchange Act of 1934, as amended.