Exhibit 4.4
WARRANT AGREEMENT
WARRANT AGREEMENT, dated as of June 17, 1996 between VIMRx
Pharmaceuticals Inc., a Delaware corporation (the "Company"), and American Stock
Transfer & Trust Company (the "Warrant Agent").
WHEREAS, in connection with a private placement offering of up
to 2,800,000 units ("Units"), each Unit consisting of one share of the Company's
Common Stock, $.001 par value ("Common Stock") and one-half a Common Stock
Subscription Warrant (each a "Warrant" and collectively, the "Warrants")
pursuant to a Subscription and Registration Rights Agreement dated March 21,
1996 between the Company and the investors signatory thereto, and the automatic
conversion of certain warrants issued by the Company in December 1995 upon the
closing of the private placement offering of Units, the Company will issue up to
2,400,000 Warrants; and
WHEREAS, each Warrant entitles the registered holder thereof
(each a "Holder" and collectively, the "Holders") to purchase one share of
Common Stock at an Exercise Price (as defined in Section 9 hereof) of $1.50,
subject to adjustment as hereinafter provided (the shares of Common Stock
issuable upon exercise of the Warrants hereinafter referred to as the "Warrant
Shares"); and
WHEREAS, the Company desires the Warrant Agent to act on
behalf of the Company, and the Warrant Agent is willing so to act, in connection
with the issuance, registration, transfer and exchange of the Warrants, the
exercise of the Warrants, and the rights of the Holders;
NOW, THEREFORE, in consideration of the foregoing and for the
purpose of defining the terms and provisions of the Warrants and the respective
rights and obligations thereunder of the Company, the Holders and the Warrant
Agent, the Company and the Warrant Agent hereby agree as follows:
SECTION 1. Appointment of Warrant Agent. The Company hereby
appoints the Warrant Agent to act as agent for the Company in accordance with
the provisions set forth in this Agreement, and the Warrant Agent hereby accepts
such appointment. As used herein, the term "Warrant Agent" shall mean the
Warrant Agent and any successor appointed hereunder.
SECTION 2. Form and Countersignature of Warrants.
2.1 Form of Warrant. The text of the Warrant, the subscription
form (the "Subscription Form"), and form of assignment shall be substantially as
set forth in the form of warrant certificate attached hereto as Exhibit A. The
Warrants shall be executed on behalf of the Company by one or more authorized
officers. The signature of any such officers on the Warrants may be made
manually or by facsimile.
2.2 Countersignature of Warrants. The Warrants shall be
countersigned manually or by facsimile by the Warrant Agent and shall not be
valid for any purpose unless so countersigned. Warrants may be countersigned by
the Warrant Agent and may be issued or delivered by the Warrant Agent,
notwithstanding that the persons whose manual or facsimile signatures appear
thereon as proper officers of the Company shall have ceased to be such officers
at the time of such countersignature, issuance or delivery. Warrants shall be
dated as of the date of issuance or countersignature thereof by the Warrant
Agent either upon initial issuance or upon exchange, substitution or transfer.
SECTION 3. Issuance and Registration of Warrants.
3.1 Initial Issuance of Warrants. The Warrant Agent shall
issue the Warrants upon receipt of, and in accordance with, a statement from an
authorized representative of the Company as contemplated by Section 14.10 hereof
specifying the identity of, and number of Warrants to be issued to, each person
or entity to be issued Warrants.
3.2 Registration. The Warrants shall be numbered and shall be
registered in a warrant register maintained by the Warrant Agent as they are
issued. The Company and the Warrant Agent may deem and treat the registered
holder of a Warrant Certificate as the absolute owner thereof (notwithstanding
any notation of ownership or other writing thereon made by anyone), for the
purpose of any exercise thereof and any distribution to the holder thereof and
for all other purposes and neither the Company nor the Warrant Agent shall be
affected by any notice to the contrary. The Company shall not be bound to
recognize any equitable or other claim to or interest in such Warrant on the
part of any other person.
SECTION 4. Transfer and Exchange of Warrants.
4.1 Transfer of Warrants. The Warrants shall be transferable
only on the books of the Warrant Agent maintained at the principal office of the
Warrant Agent upon delivery thereof duly endorsed by the Holder or by his duly
authorized attorney or representative, or accompanied by proper evidence of
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succession, assignment or authority to transfer, which endorsement shall be
guaranteed by an eligible guarantor institution which is a member of a signature
guarantee program satisfactory to the Warrant Agent (an "Eligible Institution").
Warrants may be transferred only in whole, so as to allow the Holder of each
Warrant to purchase one full share of Common Stock. In all cases of transfer by
an attorney-in-fact, the original power of attorney, duly approved, or a copy
thereof, duly certified, in such form and with such other evidence of authority
as the Warrant Agent shall request, shall be deposited and remain with the
Warrant Agent. In case of transfer by executors, administrators, guardians or
other legal representatives, duly authenticated evidence of their authority
shall be produced, in such form and with such other evidence of authority as the
Warrant Agent shall request, and may be required to be deposited and remain with
the Warrant Agent in its discretion. Upon any such registration of transfer, the
Warrant Agent shall countersign and deliver a new Warrant or Warrants to the
person entitled thereto.
4.2 Exchange of Warrant Certificates. Each Warrant certificate
may be exchanged upon surrender at the principal office of the Warrant Agent for
another certificate or certificates entitling the Holder thereof to purchase a
like aggregate number of Warrant Shares as the certificate or certificates
surrendered then entitle such Holder to purchase. Any Holder desiring to
exchange a Warrant certificate or certificates shall make such request in
writing delivered to the Warrant Agent, and shall surrender, properly endorsed,
the certificate or certificates to be so exchanged. Thereupon, the Warrant Agent
shall countersign and deliver to the Holder a new Warrant certificate or
certificates, as the case may be, as so requested, in the name of such Holder.
No fractional Warrant certificates shall be issued and no new Warrant
certificate entitling the Holder thereof to purchase fractional shares will be
issued.
SECTION 5. Term of Warrants; Exercise of Warrants.
5.1 Term of Warrants. Subject to the terms of this Agreement,
each Holder shall have the right, which may be exercised commencing at the
opening of business on June 21, 1996 until 5:00 p.m., New York time, on June 20,
2006 (the "Expiration Date"), to purchase from the Company the number of fully
paid and nonassessable Warrant Shares which the Holder may at the time be
entitled to purchase on exercise of such Warrants.
5.2 Exercise of Warrants. A Warrant may be exercised upon
surrender to the Warrant Agent at its principal office of the certificate or
certificates evidencing the Warrants to be exercised, together with the
Subscription Form duly completed and signed, which signature shall be guaranteed
by an Eligible Institution, and upon payment to the Warrant Agent for the
account of the Company of the Exercise Price (as defined in Section 9 hereof and
subject to adjustment in accordance with the provisions of Section 10 hereof)
for the number of Warrant Shares in respect of which such Warrants are then
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exercised. Payment of the aggregate Exercise Price shall be made by certified or
official bank check.
Upon the surrender of Warrants and payment of the Exercise
Price as aforesaid, the Warrant Agent shall (i) cause to be issued and delivered
as soon as practicable to or upon the written order of the Holder in such name
or names as the Holder may designate, a certificate or certificates for the
number of full Warrant Shares so purchased upon the exercise of such Warrants
and, if the Warrants are exercised in whole, in lieu of any fractional share of
the Common Stock to which the Holder shall be entitled, pay to the Holder or
such other person as the Holder may designate cash in an amount equal to the
closing price per share on the trading day preceding the date of such exercise
multiplied by such fraction, and (ii) deliver the other securities and
properties receivable upon the exercise of the Warrants pursuant to the
provisions of the Warrants. The Company shall promptly provide to the Warrant
Agent the cash payable in lieu of a fractional share. No certificate for
fractional Warrant Shares will be issued. If permitted by applicable law, such
certificate or certificates shall be deemed to have been issued and any person
so designated to be named therein shall be deemed to have become a holder of
record of such Warrant Shares as of the date of the receipt by the Warrant Agent
of such Warrants and payment of the Exercise Price, as aforesaid. The rights of
purchase represented by the Warrants shall be exercisable, at the election of
the Holders thereof, either in full or from time to time in part, and in the
event that a certificate evidencing Warrants is exercised in respect of less
than all of the Warrant Shares purchasable on such exercise at any time prior to
the date of expiration of the Warrants, a new certificate evidencing the
remaining Warrant or Warrants will be issued to the Holder thereof, and the
Warrant Agent is hereby authorized to countersign and deliver the required new
Warrant certificate or certificates pursuant to the provisions of this Section
and Section 2 hereof.
5.3 Compliance with Government Regulations. The Company
covenants that if any shares of Common Stock required to be reserved for
purposes of exercise of Warrants require, under any federal securities law or
applicable governing rule or regulation of any national securities exchange or
over-the-counter market, registration with or approval of any governmental
authority, or listing on any such national securities exchange or
over-the-counter market, the Company will in good faith prior to the issuance of
such shares endeavor to cause such shares to be duly registered, approved or
listed on the relevant national securities exchange or over-the-counter market,
as the case may be. The Company covenants that it will use reasonable efforts to
obtain any required approvals or registration under state "blue sky" securities
laws for the issuance of the Warrant Shares.
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SECTION 6. Payment of Taxes. The Company will pay all stamp,
original issue, transfer, or similar taxes, if any, attributable to the initial
issuance of Warrant Shares upon the exercise of Warrants; provided, however,
that the Company shall not be required to pay any tax or taxes which may be
payable in respect of any transfer involved in the issue or delivery of any
Warrants or certificates for Warrant Shares in a name other than that of the
Holder of such Warrants.
SECTION 7. Mutilated or Missing Warrants. In case any of the
certificates evidencing the Warrants shall be mutilated, lost, stolen or
destroyed, the Company may in its discretion issue, and the Warrant Agent shall
countersign and deliver in exchange and substitution for and upon cancellation
of the mutilated Warrant certificate, or in lieu of and in substitution for the
Warrant certificate lost, stolen or destroyed, a new Warrant certificate of like
tenor and representing an equivalent right or interest, but only upon receipt of
evidence satisfactory to the Company and the Warrant Agent of such loss, theft
or destruction of such Warrant and an indemnity or bond, if requested, also
satisfactory to them. An applicant for such a substitute Warrant certificate
shall also comply with such other reasonable regulations and pay such other
reasonable charges as the Company or the Warrant Agent may prescribe.
SECTION 8. Reservation of Warrant Shares;
Purchase and Cancellation of Warrants.
8.1 Reservation of Warrant Shares. Commencing June 20, 1996
(following the filing by the Company of a Certificate of Amendment increasing
the Company's authorized shares of Common Stock to 20,000,000 shares), there
shall have been reserved, and the Company shall at all times keep reserved, out
of its authorized Common Stock, a number of shares of Common Stock sufficient to
provide for the exercise of the rights of purchase represented by the
outstanding Warrants. The transfer agent for the Common Stock (the "Transfer
Agent") and every subsequent transfer agent for any shares of the Company's
capital stock issuable upon the exercise of any of the rights of purchase
aforesaid will be authorized and directed at all times to reserve such number of
authorized shares as shall be required for such purpose. The Company will keep a
copy of this Agreement on file with the Transfer Agent and with every subsequent
transfer agent for any shares of the Company's capital stock issuable upon the
exercise of the rights of purchase represented by the Warrants. The Warrant
Agent is hereby authorized to requisition from time to time from the Transfer
Agent the stock certificates required to honor outstanding Warrants upon
exercise thereof in accordance with the terms of this Agreement. The Company
will supply the Transfer Agent and any such subsequent transfer agent with duly
executed stock certificates for such purposes. The Company will furnish the
Transfer Agent and any such subsequent transfer agent a copy of all notices of
adjustments delivered by the Company to the Warrant Agent hereunder.
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8.2 Purchase of Warrants by the Company. The Company shall
have the right, except as limited by law, other agreements or herein, to
purchase or otherwise acquire Warrants at such times, in such manner and for
such consideration as it may deem appropriate.
8.3 Cancellation of Warrants. In the event the Company shall
purchase or otherwise acquire Warrants, the same shall thereupon be delivered to
the Warrant Agent and be cancelled by it and retired. The Warrant Agent shall
cancel any Warrant surrendered for exchange, substitution, transfer or exercise
in whole or in part and such cancelled Warrant Certificate shall be disposed of
by the Warrant Agent in a manner satisfactory to the Company.
SECTION 9. Exercise Price. The price per share at which a
Warrant Share shall be purchasable upon exercise of a Warrant (the "Exercise
Price") shall be $1.50, subject to adjustment as provided in Section 10 hereof.
SECTION 10. Adjustments. The Exercise Price and the number and
kind of securities subject to purchase upon the exercise of each Warrant shall
be subject to adjustment form time to time upon the happening of certain events,
as hereinafter set forth. The Aggregate Warrant Price with respect to each
Holder shall equal $1.50 multiplied by the number of Warrant Shares represented
by the certificate evidencing the Warrants issuable to a Holder on the date
hereof.
10.1 Adjustments. (a) If, at any time or from time to time
after the issuance date of the Warrants, the Company shall issue or distribute
to the holders of shares of Common Stock evidence of its indebtedness, any other
securities of the Company or any cash, property or other assets (excluding a
subdivision, combination or reclassification, or dividend or distribution
referred to in Section 10.1(b), and also excluding cash dividends or cash
distributions paid out of net profits legally available therefor in the full
amount thereof, which together with the value of other dividends and
distributions made substantially concurrently therewith or pursuant to a plan
which includes payment thereof, is equivalent to not more than 5% of the
Company's net worth) (any such non-excluded event being herein called a "Special
Dividend"), then the Exercise Price in effect immediately prior to the close of
business on the record date fixed for the determination of holders of any class
of securities entitled to receive such Special Dividend shall be adjusted by
multiplying the Exercise Price then in effect by a fraction, the numerator of
which shall be the then Current Market Price (as defined in paragraph (g) below)
of the Common Stock less the fair market value of the evidence of indebtedness,
cash, securities or property, or other assets issued or distributed in such
Special Dividend applicable to one share of Common Stock, and the denominator of
which shall be the then Current Market Price of the Common Stock. An adjustment
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made pursuant to this Section 10.1(a) shall become effective immediately after
the record date of any such Special Dividend.
(b) Except for an event set forth in Section 10.1(e) in case
the Company shall hereafter (i) pay a dividend or make a distribution on its
capital stock in shares of Common Stock, (ii) subdivide its outstanding shares
of Common Stock into a greater number of shares, (iii) combine its outstanding
shares of Common Stock into a smaller number of shares or (iv) issue by
reclassification of its Common Stock any shares of capital stock of the Company,
the Exercise Price in effect immediately prior to the close of business on the
record date fixed for such dividend or distribution, subdivision, combination or
reclassification shall be adjusted to be equal to a fraction, the numerator of
which shall be the Aggregate Warrant Price and the denominator of which shall be
the number of shares of Common Stock or other capital stock of the Company which
such Holder would have owned immediately following such action had such Warrants
been exercised immediately prior thereto. An adjustment made pursuant to this
Subsection 10.1(b) shall become effective immediately after the record date in
the case of a dividend or distribution and shall become effective immediately
after the effective date in the case of a subdivision, combination or
reclassification.
(c)(i) Except as provided in Sections 10.1(a) and 10.1(e), in
case the Company shall hereafter issue or sell any Common Stock, any securities
convertible into Common Stock or any rights, options or warrants to purchase
Common Stock or securities convertible into Common Stock, or set a record date
for the determination of holders of any securities entitled to receive any such
issuance, in each case for a price per share or entitling the holders thereof to
purchase Common Stock at a price per share (determined by dividing (x) the total
amount, if any, received or receivable by the Company in consideration of the
issuance or sale of such securities plus the total consideration, if any,
payable to the Company upon exercise or conversion thereof (the "Total
Consideration") by (y) the number of additional shares of Common Stock issuable
upon exercise or conversion of such securities) less than the greater of (x) the
Current Market Price and (y) the then current Exercise Price in effect on the
record date for such issuance or, if there is no record date, the date of such
issuance or sale, the Exercise Price shall be adjusted by multiplying the
Exercise Price then in effect by a fraction, the numerator of which shall be the
sum of (1) the number of shares of Common Stock outstanding on such issue or
sale date or record date and (2) the number of additional shares of Common Stock
which the Total Consideration would purchase at the greater of (x) the Current
Market Price or (y) the then current Exercise Price, and the denominator of
which shall be the sum of (1) the number of shares of Common Stock outstanding
on such record date or, if there is no record date, immediately prior to such
issue or sale and (2) the number of additional shares of Common Stock to be
sold, issued or issuable (or into which the convertible securities to be sold,
issued or issuable are convertible). An adjustment
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pursuant to this Section 10.1(c) shall be made successively whenever an event
described in this Section 10.1(c) shall occur and shall become effective on the
record date for the determination of holders entitled to receive such issuance
or if there is no record date, immediately after the date of such sale or
issuance.
(ii) For purposes of this Section 10.1(c), in the
event the Company shall assume, amend or modify the terms of any right, option,
warrant or convertible security, for purposes of determining an adjustment, if
any, to the Exercise Price, if any, pursuant to this Section 10.1(c) such right,
option, warrant or convertible security shall be deemed issued or sold on the
date of such assumption or amendment or modification.
(iii) No further adjustment to the Exercise Price
shall be made upon the subsequent issue or sale of shares of Common Stock or
convertible securities or upon the exercise of such rights, options or warrants,
or the conversion of such convertible securities; provided that to the extent
that shares of Common Stock are not delivered (or securities convertible into
Common Stock are not delivered) after the expiration of any rights, options or
warrants to purchase Common Stock or securities convertible into Common Stock,
the Exercise Price shall be readjusted to the Exercise Price which would then be
in effect had the adjustments made upon the issuance of such securities
convertible into Common Stock or any rights, options or warrants to purchase
Common Stock or securities convertible into Common Stock been made upon the
basis of delivery of only the number of shares of Common Stock (or securities
convertible into Common Stock) actually delivered.
(d) No adjustment in the Exercise Price shall be required in
the case of the issuance by the Company of Common Stock pursuant to the exercise
of these Warrants or the issuance of shares of Common Stock pursuant to the
option, warrants, rights, convertible securities and contracts set forth in
Section 3.2 of the Subscription and Registration Rights Agreement as such
option, warrants, rights, convertible securities and contracts are in effect on
the date hereof.
(e) In case of any capital reorganization or reclassification
(other than a change in par value), or any consolidation or merger to which the
Company is a party, or in case of any sale or conveyance to another entity of
the property of the Company as an entirety or substantially as an entirety, the
Warrants shall after such reorganization, reclassification, consolidation,
merger, sale or conveyance be exercisable, upon the terms and conditions of the
Warrants, for the kind and amount of securities, cash or other property which
the Holder would have owned or have been entitled to receive immediately after
such reorganization, reclassification, consolidation, merger, sale or conveyance
had the Warrants been exercised immediately prior to the effective date of such
reorganization, reclassification, consolidation, merger, sale or conveyance and
in any such case, if necessary, the provisions set forth in this Section 3 with
respect to the rights and interests thereafter of the Holders of the Warrants
shall be appropriately adjusted so as to be applicable, as nearly as may
reasonably be, to any shares of stock or other securities or property thereafter
deliverable on the exercise of the Warrants. The above provisions of this
Section 10.1 shall similarly apply to successive reorganizations,
reclassifications, consolidations, mergers, sales or
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conveyances. The subdivision or combination of shares of Common Stock at any
time outstanding into a greater or lesser number of shares shall not be deemed
to be a reclassification of the Common Stock for the purposes of this Section
10.1(e). The Company shall not effect any such reorganization, reclassification,
consolidation, merger, sale or conveyance unless prior to or simultaneously with
the consummation thereof the successor corporation (if other than the Company)
resulting from such transaction or the corporation purchasing such assets or
other appropriate corporation or entity shall assume, by written instrument
executed and delivered to the Holders, the obligation to deliver to the Holders
such shares of stock, securities or assets as, in accordance with the foregoing
provisions, such Holders may be entitled to purchase and the other obligations
under the Warrants. The issuer of any shares of stock or other securities or
property thereafter deliverable on the exercise of the Warrants shall be
responsible for all of the agreements and obligations of the Company hereunder.
Notice of any such reorganization, reclassification, consolidation, merger, sale
or conveyance and of said provisions so proposed to be made, shall be mailed to
the Holders not less than 30 days prior to such event.
(f) For purposes of any computation respecting consideration
received pursuant to Sections 10.1(a), (b) or (c) above, the following shall
apply:
(i) in the case of the issuance of shares of Common
Stock for cash, the consideration shall be the amount of such cash, provided
that in no case shall any deduction be made for any commissions, discounts or
other expenses incurred by the Company for any underwriting of the issue or
otherwise in connection therewith; and
(ii) in the case of the issuance of shares 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 market value thereof as
determined in good faith by the Board of Directors of the Company (irrespective
of the accounting treatment thereof), whose determination shall be conclusive.
(g) For purposes hereof, the Current Market Price per share of
Common Stock at any date shall be deemed to be the average of the daily closing
prices for 30 consecutive trading days ending on the date immediately prior to
such date, and if the Common Stock is no longer listed on a national securities
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exchange or over-the-counter market, the Current Market Price (and the closing
price per share in Section 5.2) shall be as determined by the Board of
Directors.
(h) In the event of any adjustment to the Exercise Price
pursuant to this Section 10.1, the number of Warrant Shares shall be adjusted by
dividing the Aggregate Warrant Price by the Exercise Price in effect immediately
after such adjustment.
(i) In case any event shall occur as to which the other
provisions of this Section 10.1 are not strictly applicable but as to which the
failure to make any adjustment would not fairly protect the purchase rights
represented by the Warrants in accordance with the essential intent and
principles hereof then, in each such case, the Holders representing the right to
purchase a majority of the shares of Common Stock and other securities and
properties receivable upon the exercise of the Warrants may appoint a firm of
independent public accountants of recognized national standing reasonably
acceptable to the Company, which shall give their opinion as to the adjustment,
if any, on a basis consistent with the essential intent and principles
established herein, necessary to preserve the purchase rights represented by
these Warrants. Upon receipt of such opinion, the Company will promptly mail a
copy thereof to the Holders and shall make the adjustments described therein.
The fees and expenses of such independent public accountants shall be borne by
the Company.
(j) No adjustment in the Exercise Price shall be required
unless such adjustment would require an increase or decrease of at least $0.05
per share of Common Stock; provided, however, that any adjustments which by
reason of this Section 10.1(j) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment; provided, further,
however, that adjustments shall be required and made in accordance with the
provisions of this Section 10.1 (other than this Section 10.1(j)) not later than
such time as may be required in order to preserve the tax-free nature of any
distribution to the Holders or Common Stock issuable upon the exercise of the
Warrants. All calculations under this Section 10.1 shall be made to the nearest
cent or to the nearest 1/100th of a share, as the case may be. Anything in this
Section 10.1 to the contrary notwithstanding, the Company shall be entitled to
make such reductions in the Exercise Price, in addition to those required by
this Section 10.1, as it in its discretion shall deem to be advisable in order
that any stock dividend, subdivision of shares or distribution of options,
rights or warrants to purchase stock or securities convertible for stock
hereafter made by the Company to its holders of the Common Stock shall not be
taxable.
(k) Whenever the Exercise Price is adjusted as provided in this
Section 10.1 and upon any modification of the rights of the Holders of these
Warrants in accordance with this Section 10.1, the Company shall promptly
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but in no event later than ten days after any request for an adjustment by the
Holder, obtain, at its expense, a certificate of a firm of independent public
accountants of recognized standing selected by the Board of Directors (who may
be the regular auditors of the Company) setting forth the Exercise Price and the
number of shares of Common Stock and other securities and properties receivable
upon exercise of the Warrants after such adjustment or the effect of such
modification, a brief statement of the facts requiring such adjustment or
modification and the manner of computing the same and cause copies of such
certificate to be mailed to the Holders of the Warrants.
(l) If, as a result of an adjustment made pursuant to this
Section 10.1, the Holder thereafter surrendered for exercise shall become
entitled to receive shares of two or more classes of capital stock or shares of
Common Stock and other capital stock of the Company, the Board of Directors
(whose determination shall be conclusive and shall be described in a written
notice to the Holder promptly after such adjustment) shall determine the
allocation of the adjusted Exercise Price between or among shares or such
classes of capital stock or shares of Common Stock and other capital stock. In
the event that at any time, as a result of an adjustment made pursuant to this
Section 10.1, the holder of any Warrant thereafter exercised shall become
entitled to receive any shares of capital stock of the Company other than shares
of Common Stock, thereafter the number of such other shares so receivable upon
exercise of the Warrants shall be subject to adjustment from time to time in a
manner and on terms as nearly equivalent as practicable to the provisions with
respect to the shares of Common Stock contained in Section 10.1, and the
remainder of the terms of the Warrants shall apply on like terms to any such
other shares.
10.2 Notice of Adjustment. Whenever the Exercise Price is
adjusted, as herein provided, the Company shall cause the Warrant Agent promptly
to give notice to the Holders as provided in Section 17 hereof of such
adjustment or adjustments and shall deliver to the Warrant Agent a certificate
setting forth the Exercise Price after such adjustment, setting forth a brief
statement of the facts requiring such adjustment and setting forth the
computation by which such adjustment was made. The Warrant Agent shall be
entitled to rely on such certificate and shall be under no duty or
responsibility with respect to any such certificate, except to exhibit the same,
from time to time, to any Holder desiring an inspection thereof during
reasonable business hours. The Warrant Agent shall not at any time be under any
duty or responsibility to any Holders to determine whether any facts exist which
may require any adjustment of the Exercise Price or other stock or property
purchasable on the exercise thereof, or with respect to the nature or extent of
any such adjustment when made, or with respect to the method employed in making
such adjustment.
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10.3 Statement on Warrants. Irrespective of any adjustments in
the Exercise Price or the number or kind of shares or other property purchasable
upon the exercise of the Warrants or other amendments to or corrections of this
Agreement, Warrants theretofore or thereafter issued may continue to express the
same price and number and kind of shares as are stated in the Warrants initially
issuable pursuant to this Agreement.
SECTION 11. No Rights as Stockholders; Notice to Holders.
Nothing contained in this Agreement or in any of the Warrants shall be construed
as conferring upon the Holders or their transferees the right to vote or to
receive dividends or to consent or to receive notice as stockholders in respect
of any meeting of stockholders for the election of directors of the Company or
any other matter, or any rights whatsoever as stockholders of the Company. If
the Board of Directors of the Company shall set a record date for any action
which would require an adjustment pursuant to Section 10, the Company shall
cause the Warrant Agent to mail notice thereof to the Holders of the Warrants
not less than 10 days prior to the record date with respect to any such action.
SECTION 12. Disposition of Proceeds on Exercise of Warrants;
Inspection of Warrant Agreement. The Warrant Agent shall account promptly to the
Company with respect to Warrants exercised and concurrently pay to the Company
all monies received by the Warrant Agent for the purchase of the Warrant Shares
through the exercise of such Warrants.
The Warrant Agent shall keep copies of this Agreement and any
notices given or received hereunder available for inspection by the Holders
during normal business hours at its principal office. The Company shall supply
the Warrant Agent from time to time with such number of copies of this Agreement
as the Warrant Agent may request.
SECTION 13. Merger or Consolidation or Change of Name of
Warrant Agent. Any corporation into which the Warrant Agent may be merged or
with which it may be consolidated, or any corporation resulting from any merger
or consolidation to which the Warrant Agent shall be a party, or any corporation
succeeding to substantially all of the business of the Warrant Agent, shall be
the successor to the Warrant Agent hereunder without the execution or filing of
any paper or any further act on the part of any of the parties hereto, provided
that such corporation would be eligible for appointment as a successor Warrant
Agent under the provisions of Section 15 hereof. In case at the time such
successor to the Warrant Agent shall succeed to the agency created by this
Agreement any of the Warrants shall have been countersigned but not delivered,
any such successor to the Warrant Agent may adopt the countersignature of the
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original Warrant Agent and deliver such Warrants so countersigned; and in case
at that time any of the Warrants shall not have been countersigned, any
successor to the Warrant Agent may countersign such Warrants either in the name
of the predecessor Warrant Agent or in the name of the successor Warrant Agent;
and in any such cases such Warrants shall have the full force provided in the
Warrants and in this Agreement.
In case at any time the name of the Warrant Agent shall be
changed and at such time any of the Warrants shall have been countersigned but
not delivered, the Warrant Agent may adopt the countersignatures under its prior
name and deliver such Warrants so countersigned; and in case at that time any of
the Warrants shall not have been countersigned, the Warrant Agent may
countersign such Warrants either in its prior name or in its changed name; and
in all such cases such Warrants shall have the full force provided in the
Warrants and in this Agreement.
SECTION 14. Concerning the Warrant Agent. The Warrant Agent
undertakes the duties and obligations imposed by this Agreement upon the
following terms and conditions, by all of which the Company and the Holders, by
their acceptance of Warrants, shall be bound.
14.1 Correctness of Statements. The statements contained
herein and in the Warrants shall be taken as statements of the Company and the
Warrant Agent assumes no responsibility for the correctness of any of the same
except such as describe the Warrant Agent or action taken by it. The Warrant
Agent assumes no responsibility with respect to the distribution of the Warrants
except as otherwise provided herein.
14.2 Breach of Covenants. The Warrant Agent shall not be
responsible for any failure of the Company to comply with any of the covenants
of the Company contained in this Agreement or in the Warrant.
14.3 Reliance on Counsel. The Warrant Agent may consult at any
time with legal counsel satisfactory to it (who may be counsel for the Company)
and the Warrant Agent shall incur no liability or responsibility to the Company
or to any Holder in respect of any action taken, suffered or omitted by it
hereunder in good faith and in accordance with the opinion or the advice of such
counsel.
14.4 Proof of Actions Taken. Whenever in the performance of
its duties under this Agreement the Warrant Agent shall deem it necessary or
desirable that any fact or matter be proved or established by the Company prior
to taking or suffering any action hereunder, such fact or matter (unless other
evidence in respect thereof be herein specifically prescribed and except for a
notice pursuant to Section 10.2) may be deemed conclusively to be proved and
established by a certificate signed by an officer of the Company and delivered
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to the Warrant Agent; and such certificate shall be full authorization to the
Warrant Agent for any action taken or suffered in good faith by it under the
provisions of this Agreement in reliance upon such certificate.
14.5 Compensation and Indemnification. The Company agrees to
pay the Warrant Agent reasonable compensation for all services rendered by the
Warrant Agent in the performance of its duties under this Agreement, to
reimburse the Warrant Agent for all expenses, taxes and governmental charges and
other charges of any kind and nature reasonably incurred by the Warrant Agent in
the performance of its duties under this Agreement, and to indemnify the Warrant
Agent and save it harmless against any and all liabilities, including judgments,
costs and reasonable counsel fees, for anything done or omitted by the Warrant
Agent in the performance of its duties under this Agreement except as a result
of the Warrant Agent's gross negligence or bad faith. In connection with such
indemnification, the Company shall be entitled to conduct any litigation and
shall only be required to pay the reasonable costs and fees of one counsel
selected by the Company. The Warrant Agent will cooperate in the defense of any
such action and will not settle such action without the consent of the Company.
14.6 Other Transactions in Securities of Company. The Warrant
Agent and any stockholder, director, officer or employee of the Warrant Agent
may buy, sell or deal in any of the Warrants or other securities of the Company
or become pecuniarily interested in any transaction in which the Company may be
interested or contract with or lend money to the Company or otherwise act as
fully and freely as though the Warrant Agent was not Warrant Agent under this
Agreement. Nothing herein shall preclude the Warrant Agent from acting in any
other capacity for the Company or for any legal entity including, without
limitation, acting as a lender to the Company or an affiliate thereof.
14.7 Liability of Warrant Agent. The Warrant Agent shall act
hereunder solely as the agent of the Company and its duties shall be determined
solely by the provisions hereof. The Warrant Agent shall not be liable for
anything which it may do or refrain from doing in connection with this Agreement
except for its own gross negligence or bad faith. Anything in this Agreement to
the contrary notwithstanding, in no event shall the Warrant Agent be liable for
special, indirect or consequential loss or damage whatsoever (including, but not
limited to, lost profits) even if the Warrant Agent has been advised of the
likelihood of such loss or damage and regardless of the form of action.
14.8 Reliance on Documents. The Warrant Agent will not incur
any liability or responsibility to the Company or to any Holder for any action
taken in reliance on any notice, resolution, waiver, consent, order,
certificate, or other paper, document or instrument reasonably believed by it to
be genuine and to have been signed, sent or presented by the proper party or
parties.
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14.9 Validity of Agreement. The Warrant Agent shall not be
under any responsibility in respect of the validity of this Agreement or the
execution and delivery hereof (except the due execution hereof by the Warrant
Agent) or in respect of the validity and execution of any Warrant (except its
countersignature thereof); nor shall the Warrant Agent by any act hereunder be
deemed to make any representation or warranty as to the authorization or
reservation of any Warrant Shares (or other stock) to be issued pursuant to this
Agreement or any Warrant, or as to whether any Warrant Shares (or other stock)
will, when issued, be validly issued, fully paid and nonassessable, or as to the
Exercise Price or the number or amount of Warrant Shares or other securities or
other property issuable upon exercise of any Warrant.
14.10 Instructions from Company. The Warrant Agent is hereby
authorized and directed to accept instructions with respect to the performance
of its duties hereunder from the Chairman of the Board, the President, the Chief
Financial Officer, any Vice Chairman of the Board, or any Executive, Senior or
other Vice President of the Company or any other employee of the Company
expressly authorized in writing by any of such persons as having the authority
to deliver instructions hereunder, and to apply to such officers or employees
for advice or instructions in connection with its duties, and shall not be
liable for any action taken or suffered to be taken by it in good faith in
accordance with instructions of any such officers or employees.
SECTION 15. Change of Warrant Agent. The Warrant Agent may
resign and be discharged from its duties under this Agreement by giving to the
Company 30 days' notice in writing. The Warrant Agent may be removed by like
notice to the Warrant Agent from the Company. If the Warrant Agent shall resign
or be removed or shall otherwise become incapable of acting, the Company shall
appoint a successor to the Warrant Agent. If the Company shall fail to make such
appointment within a period of 30 days after such removal or after it has been
notified in writing of such resignation or incapacity by the resigning or
incapacitated Warrant Agent or by any Holder (who shall with such notice submit
his Warrant for inspection by the Company), then any Holder may apply to any
court of competent jurisdiction located in Hartford, Connecticut for the
appointment of a successor to the Warrant Agent. Pending appointment of a
successor to the Warrant Agent, either by the Company or by such a court, the
duties of the Warrant Agent shall be carried out by the Company. Any successor
Warrant Agent, whether appointed by the Company or such a court, shall be a bank
or trust company, in good standing, incorporated under the laws of the United
States of America or any state thereof and having at the time of its appointment
as Warrant Agent a combined capital and surplus of at least $5,000,000. After
appointment, the successor Warrant Agent shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally named as
Warrant Agent without further act or deed; but the former warrant agent shall
deliver and transfer to the successor warrant agent any property at the time
held by it hereunder, and execute and deliver any further assurance, conveyance,
15
act or deed necessary for the purpose. Failure to file any notice provided for
in this Section 15, however, or any defect therein, shall not affect the
legality or validity of the resignation or removal of the warrant agent or the
appointment of the successor warrant agent, as the case may be. In the event of
such resignation or removal, the successor warrant agent shall mail, by first
class mail, postage prepaid, to each Holder, written notice of such removal or
resignation and the name and address of such successor warrant agent.
SECTION 16. Identity of Transfer Agent. Forthwith upon the
appointment of any subsequent transfer agent for the Common Stock, or any other
shares of the Company's capital stock issuable upon exercise of the Warrant, the
Company will file with the Warrant Agent a statement setting forth the name and
address of such subsequent transfer agent.
SECTION 17. Notices. Any notice pursuant to this Agreement by
the Company or by any Holder to the Warrant Agent, or by the Warrant Agent or by
any Holder to the Company, shall be in writing and shall be delivered in person,
by overnight courier, or by facsimile transmission (with hard copy to follow
promptly by first class mail or overnight courier), or mailed first class,
postage prepaid (a) to the Company at its offices ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, fax: (▇▇▇) ▇▇▇-▇▇▇▇, Attention: President; or (b)
to the Warrant Agent its corporate office, ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇. Each party hereto may from time to time change the address as facsimile
numbers to which notices to it are to be delivered or mailed hereunder by notice
to the other party.
Any notice required to be mailed pursuant to this Agreement by
the Company or the Warrant Agent to the Holders shall be in writing and shall be
mailed first class, postage prepaid, or otherwise delivered, to such Holders at
their respective addresses on the books of the Warrant Agent. Any other notices
which the Company or the Warrant Agent may wish to provide to the Holder may be
made in such manner (including by publication in a newspaper of national
circulation) as the Company or the Warrant Agent, as the case may be, shall
elect. Any notice requested by any other person may be dispatched in the
discretion of the Warrant Agent, but at no expense to the Warrant Agent or the
Company.
SECTION 18. Supplements and Amendments. The Company and the
Warrant Agent may from time to time supplement or amend this Agreement without
the approval of any Holder in order to cure any ambiguity or to correct or
supplement any provision contained herein which may be defective or inconsistent
with any other provision herein, or to make any other provisions in regard to
matters or questions arising hereunder which the Company and the Warrant Agent
may deem necessary or desirable, which shall not adversely affect in any
material manner the interest of the Holders. The Company and the Warrant Agent
16
may from time to time supplement or amend this Agreement in any other respect
with the written consent of the Holders of not less than a majority of the
Warrants then outstanding; provided, however, that no change in the number or
nature of the securities purchasable upon the exercise of any Warrant, or
increase in the Exercise Price of any Warrant, or acceleration of the Expiration
Date of any Warrant, shall be made without the written consent of the Holder of
such Warrant, other than such changes as are specifically prescribed by this
Agreement as originally executed or are made in compliance with applicable law.
SECTION 19. Successors. All the covenants and provisions of
this Agreement by or for the benefit of the Company or the Warrant Agent shall
bind and inure to the benefit of their respective successors and assigns
hereunder.
SECTION 20. Applicable Law. This Agreement and each Warrant
issued hereunder shall be governed by and construed in accordance with the laws
of the State of New York applicable to contracts made and to be performed within
such State, without giving effect to principles of conflicts of laws.
SECTION 21. Benefits of this Agreement. Nothing in this
Agreement shall be construed to give to any person or corporation other than the
Company, the Warrant Agent, and the Holders any legal or equitable right, remedy
or claim under this Agreement; this Agreement shall be for the sole and
exclusive benefit of the Company, the Warrant Agent and the Holders of the
Warrants.
SECTION 22. Counterparts. This Agreement may be executed in
counterparts and by facsimile and each of such counterparts and facsimile copies
shall for all purposes be deemed to be an original, and all such counterparts
shall together constitute but one and the same instrument.
SECTION 23. Severability. Any term or provision of this
Agreement which is invalid or unenforceable in any jurisdiction shall, as to
that jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the remaining terms
and provisions of this Agreement or affecting the validity or enforceability of
any of the terms or provisions of this Agreement in any other jurisdiction. If
any provision of this Agreement is so broad as to be unenforceable, the
provision shall be interpreted to be only so broad as is enforceable.
17
SECTION 24. Captions. The captions of the Sections and
subsections of this Agreement have been inserted for convenience only and shall
have no substantive effect.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed, all as of the day and year first above written.
VIMRx PHARMACEUTICALS INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President and Chief Executive
Officer
AMERICAN STOCK TRANSFER
& TRUST COMPANY
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
18
Exhibit A
Form of Warrant Certificate
(obverse)
EXERCISABLE ONLY ON OR AFTER JUNE 21, 1996 AND ON OR
BEFORE 5:00 P.M. NEW YORK CITY TIME ON JUNE 20, 2006
NUMBER
VPW: ________ WARRANTS: ________
SEE REVERSE SIDE
FOR DEFINITIONS
COMMON STOCK
SUBSCRIPTION WARRANTS CUSIP 927186 13 0
Incorporated Under the Laws of The State of Delaware
VIMRx PHARMACEUTICALS, INC.
This certifies that FOR VALUE RECEIVED
or registered assigns (the "Registered Holder") is the owner of the number of
Common Stock Subscription Warrants (the "Warrants") specified above. Each
Warrant initially entitles the Registered Holder to purchase, subject to the
terms and conditions set forth in this Warrant Certificate and the Warrant
Agreement (as hereinafter defined), one fully paid and nonassessable share of
Common Stock, $.001 par value (the "Common Stock"), of VIMRx Pharmaceuticals
Inc., a Delaware corporation (the "Company"), at any time between June 21, 1996
and 5:00 p.m. (New York City time) on June 20, 2006 (the "Expiration Date"),
upon surrender of this Warrant Certificate with the Subscription Form on the
reverse hereof duly executed, at the principal office of American Stock Transfer
& Trust Company, as Warrant Agent, or its successor (the "Warrant Agent"),
accompanied by payment of $1.50 per Warrant (the "Exercise Price") by certified
or official bank check made payable to the Warrant Agent for the account of the
Company.
19
This Warrant Certificate and each Warrant represented hereby
are issued pursuant to and are subject in all respects to the terms and
conditions set forth in the Warrant Agreement (the "Warrant Agreement"), dated
as of June 17, 1996, by and between the Company and the Warrant Agent. A copy of
the Warrant Agreement may be obtained by the Registered Holder upon written
request to the Company.
Upon the occurrence of certain events provided for in the
Warrant Agreement, the Exercise Price and the number and kind of securities
subject to purchase upon the exercise of each Warrant represented hereby are
subject to adjustment.
Each Warrant represented hereby is exercisable at the option
of the Registered Holder, but no fractional shares of Common Stock will be
issued. In the case of the exercise of less than all of the Warrants represented
hereby, the Company shall execute a new Warrant Certificate, which the Warrant
Agent shall countersign and deliver, for the balance of such Warrants.
This Warrant Certificate is exchangeable, upon the surrender
hereof by the Registered Holder at the principal office of the Warrant Agent,
for a new Warrant Certificate or Warrant Certificates entitling such Registered
Holder to purchase a like aggregate number of shares of Common Stock as this
Warrant Certificate entitles such Registered Holder to purchase. A Registered
Holder desiring to exchange this Warrant Certificate shall make such request in
writing delivered to the Warrant Agent, and shall surrender, properly endorsed,
this Warrant Certificate to be so exchanged. Thereupon, the Warrant Agent shall
countersign and deliver to the Registered Holder a new Warrant Certificate or
Warrant Certificates as so requested, in the name of such Registered Holder,
subject to the limitations provided in the Warrant Agreement. No fractional
Warrant Certificate shall be issued and no new Warrant Certificate entitling the
Registered Holder thereof to purchase fractional shares will be issued.
Prior to the exercise of any Warrant represented hereby, the
Registered Holder shall not be entitled to any rights of a stockholder of the
Company, including, without limitation, the right to vote or to receive
dividends, and shall not be entitled to receive any notice of any proceedings of
the Company, except as provided in the Warrant Agreement.
The Company and the Warrant Agent may deem and treat the
Registered Holder as the absolute owner hereof (notwithstanding any notation of
20
ownership or other writing hereon made by anyone) for all purposes and shall not
be affected by any notice to the contrary.
This Warrant Certificate is not valid unless countersigned by
the Warrant Agent.
IN WITNESS WHEREOF, the Company has caused this Warrant
Certificate to be duly executed, manually or in facsimile, by two of its
officers thereunto duly authorized and a facsimile of its corporate seal to be
imprinted thereon.
VIMRx PHARMACEUTICALS INC.
By:_____________________________
Secretary
By:____________________________
President and Chief Executive
Officer
COUNTERSIGNED:
AMERICAN STOCK TRANSFER & TRUST COMPANY, as Warrant Agent
By:____________________________
Authorized Officer
21
(Reverse)
The following abbreviations, when used in the inscription on
the face of this certificate, shall be construed as though they were written out
in full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT-______Custodian_______
TEN ENT - as tenants by the entireties (Cust) (Minor)
JT TEN - as joint tenants with right under Uniform Gifts to Minor
of survivorship and not as tenants Act__________________
in common (State)
Additional abbreviations may also be used though not in the above
list.
SUBSCRIPTION FORM
(To be executed only upon exercise of Warrant)
The undersigned hereby irrevocably elects to exercise the
right of purchase represented by the within Warrant Certificate for, and to
purchase thereunder, shares of Common Stock, as provided for therein, and
tenders herewith payment of the purchase price in full in the form of a
certified or official bank check in the amount of $
Please issue a certificate or certificates for such shares of
Common Stock in the name of:
Name_______________________________________
(Please Print Name, Address and Social
Security or Taxpayer Identification Number)
_______________________________________
_______________________________________
_______________________________________
_______________________________________
22
And, if said number of shares shall not be all the shares purchasable under the
within Warrant Certificate, a new Warrant Certificate is to be issued in the
name of said undersigned for the balance remaining of the shares purchasable
thereunder.
Signature ________________________________________
Note: The above signature must correspond
exactly with the name on the face of this Warrant
Certificate or with the name of assignee appearing
in the assignment form below.
--------------------------------------------
Signature Guarantee Signatures should be guaranteed
by an eligible guarantor institution which
is a member of a signature guarantee
program satisfactory to the Warrant Agent.
ASSIGNMENT
(To be executed only upon assignment of Warrant)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
[ ]
________________________________________________________________________________
(Name and Address of Assignee Must Be Printed or Typewritten)
________________________________________________________________________________
the within Warrant Certificate, hereby irrevocably constituting and appointing
_____________________________________________________________________ , Attorney
to transfer said Warrant Certificate on the books of the Company, with full
power of substitution in the premises.
Dated:_________________________________ ______________________________
Signature of Registered Holder
Note: The above signature must
correspond exactly with the
name on the face of this
Warrant Certificate.
------------------------------------
Signature Guarantee Signatures should
be guaranteed by an eligible
guarantor institution which
is a member of a signature
guarantee program
satisfactory to the Warrant
Agent.
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