15-MONTH COMMON STOCK PURCHASE WARRANT PRESSURE BIOSCIENCES INC. WARRANT NO. B-__
NEITHER
THIS SECURITY NOR THE SECURITIES FOR WHICH THIS SECURITY IS EXERCISABLE HAVE
BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES
COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY,
MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM,
OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS
EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE
SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY.
15-MONTH
COMMON STOCK PURCHASE WARRANT
WARRANT
NO. B-__
Warrant
Shares:
_____ Initial
Exercise Date: February 12, 2009
THIS
15-MONTH COMMON STOCK PURCHASE WARRANT (the “Warrant”)
certifies that, for value received, _____________ (the “Holder”)
is entitled, upon the terms and subject to the limitations on exercise and the
conditions hereinafter set forth, at any time on or after the date hereof (the
“Initial
Exercise Date”) and on or prior to the close of business on May 12, 2010,
which is 15 months after the Initial Exercise Date, or sooner in accordance with
Section 3(b) or
Section 5(c)
(the “Termination
Date”) but not thereafter, to subscribe for and purchase from Pressure
BioSciences Inc., a Massachusetts corporation (the “Company”),
up to ______ shares (the “Warrant
Shares”) of common stock, par value $0.01 per share (the “Common
Stock”), of the Company. The purchase price of one share of
Common Stock under this Warrant shall be equal to the Exercise Price, as defined
in Section
2(b).
1.
Definitions. Capitalized
terms used and not otherwise defined herein shall have the meanings set forth in
that certain Securities Purchase Agreement, dated February 12, 2009 (the “Purchase
Agreement”), by and among the Company and the purchasers signatory
thereto.
2.
Exercise.
a) Exercise of
Warrant. Exercise of the purchase rights represented by this
Warrant may be made, in whole or in part, at any time or times on or after the
Initial Exercise Date and on or before the Termination Date by delivery to the
Company of a duly executed Notice of Exercise (in the form annexed hereto, the
“Notice of
Exercise”) (or such other office or agency of the Company as it may
designate by notice in writing to the registered Holder at the address of such
Holder appearing on the books of the Company), this Warrant, and payment of the
aggregate Exercise Price of the Warrant Shares thereby purchased by wire
transfer or cashier’s check drawn on a United States bank.
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b) Exercise
Price. The exercise price per share of the Common Stock under
this Warrant shall be $1.25, subject to adjustment
hereunder (the “Exercise
Price”).
c) Cashless
Exercise.
i. If
at any time after six (6) months from the date of issuance of this Warrant (x)
there is no effective Registration Statement (as defined in that certain
Registration Rights Agreement, dated February 12, 2009, by and among the Company
and the other parties thereto) registering, or no current prospectus under such
Registration Statement available for, the resale of all of the Warrant Shares by
the Holder, and (y) the Warrant Shares not registered under such Registration
Statement and not provided for in any such prospectus thereunder may not be
resold without restriction by the Holder pursuant to Rule 144 under the
Securities Act (such Warrant Shares, the “Restricted
Warrant Shares”), then this Warrant may also be exercised at such time by
means of a “cashless exercise” only with respect to such Restricted Warrant
Shares, in which case the Holder shall be entitled to receive that number of
Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A),
where:
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(A)
=
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the
volume weighted average price (“VWAP”)
on the Trading Day immediately preceding the date of such election (with
the date of such election being deemed to be the date on which the Company
receives the Holder’s duly executed Notice of Exercise and this
Warrant);
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(B)
=
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the
Exercise Price, as adjusted; and
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(X)
=
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the
number of Restricted Warrant Shares issuable upon exercise of this Warrant
in accordance with the terms of this Warrant by means of a cash exercise
rather than a cashless exercise.
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Notwithstanding
the foregoing provisions of this Section 2(c)(i), this
Warrant may be exercised only (A) first in accordance with Section 2(a) by
payment of the Exercise Price in cash with respect to the Warrant Shares that
are not Restricted Warrant Shares, and only after this Warrant has been so
exercised with respect to all such Warrant Shares this Warrant may be exercised
(B) in accordance with this Section 2(c)(i) by
means of cashless exercise with respect to the Restricted Warrant
Shares.
ii. At
any time that the Holder is an Affiliate of the Company, this Warrant may also
be exercised by means of a “cashless exercise” with respect to all Warrant
Shares, in which case the Holder shall be entitled to receive that number of
Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A),
where:
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(A)
=
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the
VWAP on the Trading Day immediately preceding the date of such election
(with the date of such election being deemed to be the date on which the
Company receives the Holder’s duly executed Notice of Exercise and this
Warrant);
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(B)
=
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the
Exercise Price, as adjusted; and
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(X)
=
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the
number of Warrant Shares issuable upon exercise of this Warrant in
accordance with the terms of this Warrant by means of a cash exercise
rather than a cashless exercise.
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d) ▇▇▇▇▇▇’s
Restrictions. The Company shall not effect any exercise of
this Warrant, and a Holder shall not have the right to exercise any portion of
this Warrant, pursuant to Section 2, to the
extent that after giving effect to such issuance after exercise as set forth in
the applicable Notice of Exercise, such Holder (together with such Holder’s
Affiliates, and any other person or entity acting as a group together with such
Holder or any of such Holder’s Affiliates) would beneficially own in excess of
the Beneficial Ownership Limitation (as defined below). For purposes
of the foregoing sentence, the number of shares of Common Stock beneficially
owned by such Holder and its Affiliates shall include the number of shares of
Common Stock issuable upon exercise of this Warrant with respect to which such
determination is being made, but shall exclude the number of shares of Common
Stock which would be issuable upon (A) exercise of the remaining, non-exercised
portion of this Warrant beneficially owned by such Holder or any of its
Affiliates and (B) exercise or conversion of the unexercised or non-converted
portion of any other securities of the Company (including, without limitation,
shares of Series A Convertible Preferred Stock, options and any other warrants)
subject to a limitation on conversion or exercise analogous to the limitation
contained herein beneficially owned by such Holder or any of its
Affiliates. Except as set forth in the preceding sentence, for
purposes of this Section 2(d),
beneficial ownership shall be calculated in accordance with Section 13(d) of the
Exchange Act, it being acknowledged by the Holder that the Company is not
representing to such Holder that such calculation is in compliance with Section
13(d) of the Exchange Act and such Holder is solely responsible for any
schedules required to be filed in accordance therewith. To the extent
that the limitation contained in this Section 2(d) applies,
the determination of whether this Warrant is exercisable in full or in part (in
relation to other securities owned by such Holder together with any Affiliates)
shall be made by the Holder, and the submission of a Notice of Exercise shall be
deemed to be each Holder’s determination of whether this Warrant is exercisable
(in relation to other securities owned by such Holder together with any
Affiliates), in each case subject to such aggregate percentage limitation, and
the Company shall have no obligation to verify or confirm the accuracy of such
determination. In addition, a determination as to any group status as
contemplated above shall be determined in accordance with Section 13(d) of the
Exchange Act. Upon the written request of the Holder, the Company
shall within two (2) Trading Days confirm in writing to such Holder the number
of shares of Common Stock then outstanding. In any case, the number
of outstanding shares of Common Stock shall be determined after giving effect to
the conversion or exercise of securities of the Company, including this Warrant,
by such Holder or its Affiliates since the date as of which such number of
outstanding shares of Common Stock was reported. The “Beneficial
Ownership Limitation” shall be 4.99% of the number of shares of the
Common Stock outstanding immediately after giving effect to the issuance of
shares of Common Stock issuable upon exercise of this Warrant. The
Beneficial Ownership Limitation provisions of this Section 2(d) may be
waived by the Holder, at the election of such Holder, upon not less than
sixty-one (61) days prior written notice to the Company (which notice period, if
requested by the Holder, may be waived by the Company in its sole discretion) to
increase the Beneficial Ownership Limitation to 9.99%, 14.99% or 19.99% of the
number of shares of the Common Stock outstanding immediately after giving effect
to the issuance of shares of Common Stock upon exercise of this Warrant, and the
provisions of this Section 2(d) shall
continue to apply. Upon a waiver of the Beneficial Ownership
Limitation from 4.99% to 9.99%, or from 9.99% to 14.99%, as the case may be, the
Holder may further waive the Beneficial Ownership Limitation from 9.99% to
14.99%, or from 14.99% to 19.99%, as applicable, by written notice to the
Company not less than sixty-one (61) days in advance of such waiver (which
notice period, if requested by the Holder, may be waived by the Company in its
sole discretion). Upon the change by the Holder of the Beneficial
Ownership Limitation from 14.99% to 19.99%, the Beneficial Ownership Limitation
may not be further waived by such Holder. The limitations contained
in this paragraph shall apply to a successor holder of this
Warrant.
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e) Mechanics of
Exercise.
i. Authorization of Warrant
Shares. The Company covenants that all Warrant Shares which
may be issued upon the exercise of the purchase rights represented by this
Warrant will, upon such exercise, be duly authorized, validly issued, fully paid
and nonassessable and free from all taxes, liens and charges created by the
Company in respect of the issue thereof (other than taxes in respect of any
transfer occurring contemporaneously with such issue).
ii. Delivery of Certificates
Upon Exercise. Certificates for shares purchased hereunder
shall be transmitted by the Transfer Agent to the Holder by crediting the
account of the Holder’s prime broker with the Depository Trust Company through
its Deposit Withdrawal Agent Commission (“DWAC”)
system if the Company is a participant in such system, and otherwise by the
Company or by the Transfer Agent by physical delivery to the address specified
by the Holder in the Notice of Exercise promptly, or if required by law, within
three (3) Trading Days, from the delivery to the Company of the duly executed
Notice of Exercise, surrender of this Warrant and payment of the aggregate
Exercise Price as set forth above (or an exercise
pursuant to Section 2(c)) (“Warrant Share
Delivery Date”). This Warrant shall be deemed to have been
exercised, the Warrant Shares shall be deemed to have been issued, and the
Holder or any other person so designated to be named therein shall be deemed to
have become a holder of record of such shares of Common Stock for all purposes,
on the date the Company receives the duly executed Notice of Exercise, Warrant
and Exercise Price (unless such exercise is
pursuant to Section 2(c) in which case receipt of the Exercise Price is not
applicable), and all taxes required to be paid by the Holder,
if any, pursuant to Section 2(e)(v) prior
to the issuance of such shares, have been paid.
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iii. Delivery of New Warrants
Upon Exercise. If this Warrant shall have been exercised in
part, the Company shall, at the time of delivery of the certificate or
certificates representing Warrant Shares if prior to the Termination Date,
deliver to Holder a new Warrant evidencing the right of Holder to purchase the
unpurchased Warrant Shares called for by this Warrant, which new Warrant shall
in all other respects be identical with this Warrant.
iv. No Fractional Shares or
Scrip. No fractional shares or scrip representing fractional
shares shall be issued upon the exercise of this Warrant. As to any
fraction of a share which Holder would otherwise be entitled to purchase upon
such exercise, the Company shall at its election, either pay a cash adjustment
in respect of such final fraction in an amount equal to such fraction multiplied
by the Exercise Price or round up to the next whole share.
v. Charges, Taxes and
Expenses. Issuance of certificates for Warrant Shares shall be
made without charge to the Holder for any issue or transfer tax or other
incidental expense in respect of the issuance of such certificate, all of which
taxes and expenses shall be paid by the Company, and such certificates shall be
issued in the name of the Holder or in such name or names as may be directed by
the Holder; provided,
however, that in the event certificates for Warrant Shares are to be
issued in a name other than the name of the Holder, this Warrant when
surrendered for exercise shall be accompanied by the Assignment Form attached
hereto duly executed by the Holder; and the Company may require, as a condition
thereto, the payment of a sum sufficient to reimburse it for any transfer tax
incidental thereto.
vi. Closing of
Books. The Company will not close its stockholder books or
records in any manner which prevents the timely exercise of this Warrant,
pursuant to the terms hereof.
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3. Certain
Events.
a) Adjustments for Stock
Dividends and Splits. If the Company, at any time while this Warrant is
outstanding: (A) pays a stock dividend or otherwise makes a distribution or distributions on shares of
its Common Stock or any other equity or equity equivalent securities payable in
shares of Common Stock (which, for avoidance of doubt, shall not include any
shares of Common Stock issued by the Company upon exercise of this Warrant), (B)
subdivides outstanding shares of Common Stock into a larger number of shares,
(C) combines (including by way of reverse stock split) outstanding shares of
Common Stock into a smaller number of shares, or (D) issues by reclassification
of shares of the Common Stock any shares of capital stock of the Company, then
in each case the Exercise Price shall be multiplied by a fraction of which the
numerator shall be the number of shares of Common Stock (excluding treasury
shares, if any) outstanding immediately before such event and of which the
denominator shall be the number of shares of Common Stock outstanding
immediately after such event and the number of shares issuable upon exercise of
this Warrant shall be proportionately adjusted. Any adjustment made
pursuant to this Section 3(a) shall
become effective immediately after the record date for the determination of
stockholders entitled to receive such dividend or distribution and shall become
effective immediately after the effective date in the case of a subdivision,
combination or re-classification.
b) Fundamental
Transaction. If, at any time while this Warrant is outstanding, (A) the
Company effects any merger or consolidation of the Company (or a subsidiary of
the Company and the Company issues shares of its capital stock pursuant to such
merger or consolidation) with or into another Person in which the shares of
capital stock of the Company outstanding immediately prior to such merger or
consolidation do not continue to represent, or are not converted into or
exchanged for shares of capital stock that represent, immediately following such
merger or consolidation, at least a majority, by voting power, of the capital
stock of the surviving or resulting entity, or if the surviving or resulting
entity is a wholly owned subsidiary of another entity immediately following such
merger or consolidation, the parent entity of such surviving or resulting
entity, (B) the Company effects any sale of all or substantially all of its
assets in one or a series of related transactions, (C) any tender offer or
exchange offer (whether by the Company or another Person) is completed pursuant
to which holders of Common Stock are permitted to tender or exchange their
shares for other securities, cash or property, or (D) the Company effects any
reclassification of the Common Stock or any compulsory share exchange pursuant
to which the Common Stock is effectively converted into or exchanged for other
securities, cash or property (each “Fundamental
Transaction”), then, the Holder may exercise this Warrant subject to and
conditioned upon the completion or closing of such Fundamental Transaction, and
upon such completion or closing of such Fundamental Transaction, this Warrant
shall terminate and shall no longer be exerciseable.
c) Calculations. All
calculations under this Section 3 shall be
made to the nearest cent or the nearest 1/100th of a share, as the case may be.
For purposes of this Section 3, the number
of shares of Common Stock deemed to be issued and outstanding as of a given date
shall be the sum of the number of shares of Common Stock (excluding treasury
shares, if any) issued and outstanding.
d) Notice to
Holder.
i. Adjustment to Exercise
Price. Whenever the Exercise Price is adjusted pursuant to any provision
of this Section
3, the Company shall promptly mail to the Holder a notice setting forth
the Exercise Price after such adjustment and setting forth a brief statement of
the facts requiring such adjustment.
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ii. Notice to Allow Exercise by
▇▇▇▇▇▇. If (A) the Company shall declare a dividend (or any other
distribution in whatever form) on the Common Stock; (B) the Company shall
declare a special nonrecurring cash dividend on or a redemption of the Common
Stock; (C) the Company shall authorize the granting to all holders of the Common
Stock rights or warrants to subscribe for or purchase any shares of capital
stock of any class or of any rights; (D) the approval of any stockholders of the
Company shall be required in connection with any reclassification of the Common
Stock, any consolidation or merger to which the Company is a party, any sale or
transfer of all or substantially all of the assets of the Company, any
compulsory share exchange whereby the Common Stock is converted into other
securities, cash or property, or any Fundamental
Transaction; (E) the Company shall authorize the voluntary or involuntary
dissolution, liquidation or winding up of the affairs of the Company; then, in
each case, the Company shall cause to be mailed to the Holder at its last
address as it shall appear upon the Warrant Register (as defined below) of the
Company, at least 20 calendar days prior to the applicable record or effective
date hereinafter specified, a notice stating (x) the date on which a record is
to be taken for the purpose of such dividend, distribution, redemption, rights
or warrants, or if a record is not to be taken, the date as of which the holders
of the Common Stock of record to be entitled to such dividend, distributions,
redemption, rights or warrants are to be determined or (y) the date on which
such reclassification, consolidation, merger, sale, transfer or share exchange
is expected to become effective or close, and the date as of which it is
expected that holders of the Common Stock of record shall be entitled to
exchange their shares of the Common Stock for securities, cash or other property
deliverable upon such reclassification, consolidation, merger, sale, transfer or
share exchange; provided that the failure to mail such notice or any defect
therein or in the mailing thereof shall not affect the validity of the corporate
action required to be specified in such notice if
Holder is allowed to determine in its discretion that the Company must deem the
Warrant exercised immediately prior to and contingent upon the occurrence of the
events described in (A), (B), (C), (D) or (E) above. The
Holder is entitled to exercise this Warrant during the 20-day period commencing
on the date of such notice of the record or effective date of the event
triggering such notice.
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4. Transfer of
Warrant.
a) Transferability. Subject
to compliance with any applicable securities laws and the conditions set forth
in Section 4(d)
hereof and to the provisions of Section 4.1 of the
Purchase Agreement, this Warrant and all rights hereunder (including, without
limitation, any registration rights) are transferable, in whole or in part, upon
surrender of this Warrant at the principal office of the Company or its
designated agent, together with a written assignment of this Warrant
substantially in the form attached hereto duly executed by the Holder or its
agent or attorney and funds sufficient to pay any transfer taxes payable upon
the making of such transfer. Upon such surrender and, if required,
such payment, the Company shall execute and deliver a new Warrant or Warrants in
the name of the assignee or assignees and in the denomination or denominations
specified in such instrument of assignment, and shall issue to the assignor a
new Warrant evidencing the portion of this Warrant not so assigned, and this
Warrant shall promptly be cancelled. A Warrant, if properly assigned,
may be exercised by a new holder for the purchase of Warrant Shares without
having a new Warrant issued.
b) New Warrants. This
Warrant may be divided or combined with other Warrants upon presentation hereof
at the aforesaid office of the Company, together with a written notice
specifying the names and denominations in which new Warrants are to be issued,
signed by the Holder or its agent or attorney. Subject to compliance
with Section
4(a), as to any transfer which may be involved in such division or
combination, the Company shall execute and deliver a new Warrant or Warrants in
exchange for the Warrant or Warrants to be divided or combined in accordance
with such notice.
c) Warrant Register. The
Company shall register this Warrant, upon records to be maintained by the
Company for that purpose (the “Warrant
Register”), in the name of the record Holder hereof from time to
time. The Company may deem and treat the registered Holder of this
Warrant as the absolute owner hereof for the purpose of any exercise hereof or
any distribution to the Holder, and for all other purposes, absent actual notice
to the contrary reasonably satisfactory to the Company.
d) Transfer
Restrictions. If, at the time of the surrender of this Warrant in connection with
any transfer of this Warrant, the transfer of this Warrant shall not be
registered pursuant to an effective registration statement under the Securities Act and under applicable state securities or blue sky laws, the
Company may require, as a condition of allowing such transfer, that (i) the
Holder or transferee of this Warrant, as the case may be, furnish to the Company
a written opinion of counsel (which opinion shall be in form, substance and
scope customary for opinions of counsel in comparable transactions) to the
effect that such transfer may be made without registration under the Securities Act and under applicable state securities
or blue sky laws, and (ii) the Holder or transferee execute and deliver to the
Company an investment letter in form and substance acceptable to the Company,
and (iii) the transferee be an “accredited investor” as defined in Rule 501(a)
promulgated under the Securities Act or a “qualified institutional buyer” as
defined in Rule 144A(a) promulgated under the Securities
Act.
5.
Right to
Call.
a) Call
Conditions. The Company may call for cancellation this
Warrant, subject to the limitations discussed in Section 5(b), if the
volume weighted average price for the Common Stock on the Trading Market equals
or exceeds $1.75 for either (i) ten (10) consecutive Trading Days or (ii)
fifteen (15) out of twenty-five (25) consecutive Trading Days.
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b) Callable Warrant
Shares. The Company shall not have the right to call any
portion of this Warrant, pursuant to this Section 5, to the
extent that, after giving effect to the issuance of Warrant Shares after
exercise of this Warrant, such Holder (together with such ▇▇▇▇▇▇’s Affiliates,
and any other person or entity acting as a group together with such Holder or
any of such Holder’s Affiliates) would beneficially own in excess of the
Beneficial Ownership Limitation (as defined below). For purposes of
the foregoing sentence, the number of shares of Common Stock beneficially owned
by such Holder and its Affiliates shall include the number of shares of Common
Stock issuable upon exercise of this Warrant with respect to which such right to
call determination is being made, but shall exclude the number of shares of
Common Stock which would be issuable upon (A) exercise of the remaining portion,
if any, of this Warrant with respect to which such right to call determination
is not being made beneficially owned by such Holder or any of its Affiliates and
(B) exercise or conversion of the unexercised or non-converted portion of any
other securities of the Company (including, without limitation, shares of Series
A Convertible Preferred Stock, options and any other warrants) subject to a
limitation on conversion or exercise analogous to the limitation contained
herein beneficially owned by such Holder or any of its
Affiliates. Except as set forth in the preceding sentence, for
purposes of this Section 5(b),
beneficial ownership shall be calculated in accordance with Section 13(d) of the
Exchange Act, it being acknowledged by the Holder that the Company is not
representing to such Holder that such calculation is in compliance with Section
13(d) of the Exchange Act and such Holder is solely responsible for any
schedules required to be filed in accordance therewith. To the extent
that the limitation contained in this Section 5(b) applies,
the determination of whether this Warrant may be called by the Company in full
or in part (in relation to other securities owned by such Holder together with
any Affiliates) shall be made by the Holder, and the submission of a Notice of
Exercise shall be deemed to be each Holder’s determination of whether this
Warrant is exercisable (in relation to other securities owned by such Holder
together with any Affiliates), in each case subject to such aggregate percentage
limitation, and the Company shall have no obligation to verify or confirm the
accuracy of such determination. In addition, a determination as to
any group status as contemplated above shall be determined in accordance with
Section 13(d) of the Exchange Act. Upon the written request of the
Holder, the Company shall within two (2) Trading Days confirm in writing to such
Holder the number of shares of Common Stock then outstanding. In any
case, the number of outstanding shares of Common Stock shall be determined after
giving effect to the conversion or exercise of securities of the Company,
including this Warrant, by such Holder or its Affiliates since the date as of
which such number of outstanding shares of Common Stock was
reported. The “Beneficial
Ownership Limitation” shall be 4.99% of the number of shares of the
Common Stock outstanding immediately after giving effect to the issuance of
shares of Common Stock issuable upon exercise of this Warrant. The
Beneficial Ownership Limitation provisions of this Section 5(b) may be
waived by the Holder, at the election of such Holder, upon not less than
sixty-one (61) days prior written notice to the Company (which notice period, if
requested by the Holder, may be waived by the Company in its sole discretion) to
increase the Beneficial Ownership Limitation to 9.99%, 14.99% or 19.99% of the
number of shares of the Common Stock outstanding immediately after giving effect
to the issuance of shares of Common Stock upon exercise of this Warrant, and the
provisions of this Section 5(b) shall
continue to apply. Upon a waiver of the Beneficial Ownership
Limitation from 4.99% to 9.99%, or from 9.99% to 14.99%, as the case may be, the
Holder may further waive the Beneficial Ownership Limitation from 9.99% to
14.99%, or from 14.99% to 19.99%, as applicable, by written notice to the
Company not less than sixty-one (61) days in advance of such waiver (which
notice period, if requested by the Holder, may be waived by the Company in its
sole discretion). Upon the change by the Holder of the Beneficial
Ownership Limitation from 14.99% to 19.99%, the Beneficial Ownership Limitation
may not be further waived by such Holder. The limitations contained
in this Section
5(b) shall apply to a successor holder of this Warrant.
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c) Call
Procedure. To exercise this right, the Company shall deliver
to the Holder a written notice (a “Call
Notice”) indicating therein that this Warrant must be exercised by a date
specified in the Call Notice, which date shall be at least twelve (12) Business
Days after the date of the Call Notice, and which date shall be extended for a
Holder providing written notice of waiver of the Beneficial Ownership Limitation
to the sixty-first (61st) day
following the date such Holder provides such sixty-one (61) days notice or to
such earlier date on which the Company has waived such sixty-one (61) day
notice) (such date, the “Call
Date”). If the Holder does not exercise this Warrant by the
Call Date, then on the date immediately following the Call Date this Warrant
shall terminate and shall no longer be exerciseable.
6. Miscellaneous.
a) No Rights as Shareholder
Until Exercise. This Warrant does not entitle the Holder to
any voting rights or other rights as a shareholder of the Company prior to the
exercise hereof as set forth in Section
2(e)(ii).
b) Loss, Theft, Destruction or
Mutilation of Warrant. The Company covenants that upon receipt by the
Company of evidence reasonably satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant or any stock certificate relating to
the Warrant Shares, and in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to it and upon surrender and cancellation of
such Warrant or stock certificate, if mutilated, the Company will make and
deliver a new Warrant or stock certificate of like tenor and dated as of such
cancellation, in lieu of such Warrant or stock certificate.
c) Saturdays, Sundays,
Holidays, etc. If the last or appointed day for the taking of
any action or the expiration of any right required or granted herein shall not
be a Business Day, then such action may be taken or such right may be exercised
on the next succeeding Business Day.
d) Authorized
Shares.
The
Company covenants that during the period the Warrant is outstanding, it will
reserve from its authorized and unissued Common Stock a sufficient number of
shares to provide for the issuance of the Warrant Shares upon the exercise of
any purchase rights under this Warrant, including
as the Warrant is adjusted pursuant to Section 3 above The Company further covenants
that its issuance of this Warrant shall constitute full authority to its
officers who are charged with the duty of executing stock certificates to
execute and issue the necessary certificates for the Warrant Shares upon the
exercise of the purchase rights under this Warrant. The Company will
take all such commercially reasonable action as may be necessary to assure that
such Warrant Shares may be issued as provided herein without violation of any
applicable law or regulation, or of any requirements of the Trading Market upon
which the Common Stock may be listed.
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Except
and to the extent as waived or consented to by the Holder, the Company shall not
by any action, including, without limitation, amending its articles of
organization 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 actions as may be necessary or
appropriate to protect the rights of Holder as set forth in this Warrant against
impairment. Without limiting the generality of the foregoing, the
Company will (a) not increase the par value of any Warrant Shares above the
amount payable therefor upon such exercise immediately prior to such increase in
par value, (b) take all such action as may be necessary or appropriate in order
that the Company may validly and legally issue fully paid and nonassessable
Warrant Shares upon the exercise of this Warrant, and (c) use commercially
reasonable efforts to obtain all such authorizations, exemptions or consents
from any public regulatory body having jurisdiction thereof as may be necessary
to enable the Company to perform its obligations under this
Warrant.
Before
taking any action which would result in an adjustment in the number of Warrant
Shares for which this Warrant is exercisable or in the Exercise Price, the
Company shall obtain all such authorizations or exemptions thereof, or consents
thereto, as may be necessary from any public regulatory body or bodies having
jurisdiction thereof.
e) Jurisdiction. All
questions concerning the construction, validity, enforcement and interpretation
of this Warrant shall be determined in accordance with the provisions of the
Purchase Agreement.
f) Governing
Law. This Warrant shall be governed by and construed and
enforced in accordance with the internal laws of the Commonwealth of
Massachusetts, with regard to the principles of conflicts of law
thereof.
g) Restrictions. The
Holder acknowledges that the Warrant Shares acquired upon the exercise of this
Warrant, if not registered, will have restrictions upon resale imposed by state
and federal securities laws.
h) Nonwaiver and
Expenses. No course of dealing or any delay or failure to
exercise any right hereunder on the part of Holder shall operate as a waiver of
such right or otherwise prejudice Holder’s rights, powers or remedies,
notwithstanding the fact that all rights hereunder terminate on the Termination
Date. If the Company willfully and knowingly fails to comply with any
provision of this Warrant, which results in any material damages to the Holder,
the Company shall pay to Holder such amounts as shall be sufficient to cover any
costs and expenses including, but not limited to, reasonable attorneys’ fees,
including those of appellate proceedings, incurred by Holder in collecting any
amounts due pursuant hereto or in otherwise enforcing any of its rights, powers
or remedies hereunder.
11
i) Notices. Any
notice, request or other document required or permitted to be given or delivered
to the Holder by the Company shall be delivered in accordance with the notice
provisions of the Purchase Agreement.
j) Successors and
Assigns. Subject to applicable securities laws, this Warrant
and the rights and obligations evidenced hereby shall inure to the benefit of
and be binding upon the successors of the Company and the successors and
permitted assigns of 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 or holder of Warrant
Shares.
k) Amendment. This
Warrant may be modified or amended or the provisions hereof waived with the
written consent of the Company and the Holder.
l) Severability. Wherever
possible, each provision of this Warrant shall be interpreted in such manner as
to be effective and valid under applicable law, but if any provision of this
Warrant shall be prohibited by or invalid under applicable law, such provision
shall be ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provisions or the remaining provisions of
this Warrant.
m) Headings. The
headings used in this Warrant are for the convenience of reference only and
shall not, for any purpose, be deemed a part of this Warrant.
********************
12
IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed by its
officer thereunto duly authorized as of the date first above
indicated.
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By:
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Name:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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Title:
President and Chief Executive
Officer
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13
NOTICE OF
EXERCISE
(1) The
undersigned hereby elects to purchase ________ Warrant Shares of the Company
pursuant to the terms of the attached Warrant (only if exercised in full), and
tenders herewith payment of the Exercise Price in full, together with all
applicable transfer taxes, if any.
(2)
Payment shall take the form of (check applicable box):
o in lawful money of the
United States; or
o [if permitted] the
cancellation of such number of Warrant Shares as is necessary, in accordance
with the formula set forth in Section 2(c)(i), to
exercise this Warrant with respect to the maximum number of Warrant Shares
purchasable pursuant to the cashless exercise procedure set forth in Section 2(c)(i);
or
o [if permitted] the
cancellation of such number of Warrant Shares as is necessary, in accordance
with the formula set forth in Section 2(c)(ii), to
exercise this Warrant with respect to the maximum number of Warrant Shares
purchasable pursuant to the cashless exercise procedure set forth in Section
2(c)(ii).
(3)
Please issue a certificate or certificates representing said Warrant Shares in
the name of the undersigned or in such other name as is specified
below:
_______________________________
The
Warrant Shares shall be delivered to the following DWAC Account Number or by
physical delivery of a certificate to:
_______________________________
_______________________________
_______________________________
(4) Accredited
Investor. The undersigned is an “accredited investor” as defined in
Regulation D promulgated under the Securities Act of 1933, as
amended.
[SIGNATURE
OF HOLDER]
Name of
Investing Entity:
________________________________________________________________________
Signature
of Authorized Signatory of Investing Entity:
_________________________________________________
Name of
Authorized Signatory:
___________________________________________________________________
Title of
Authorized Signatory:
____________________________________________________________________
Date:
________________________________________________________________________________________
ASSIGNMENT
FORM
(To
assign the foregoing Warrant, execute
this form
and supply required information.
Do not
use this form to exercise the Warrant.)
FOR VALUE
RECEIVED, [____] all of or [_______] shares of the foregoing Warrant and all
rights evidenced thereby are hereby assigned to
_______________________________________________
whose address is
_______________________________________________________________.
_______________________________________________________________
Dated: ______________,
_______
Holder’s
Signature: _____________________________
Holder’s
Address:
_____________________________
_____________________________
Signature
Guaranteed: ___________________________________________
NOTE: The
signature to this Assignment Form must correspond with the name as it appears on
the face of the Warrant, without alteration or enlargement or any change
whatsoever, and must be guaranteed by a bank or trust
company. Officers of corporations and those acting in a fiduciary or
other representative capacity should file proper evidence of authority to assign
the foregoing Warrant.