No. W – 04-2009-02 Warrant to Purchase 1,315,542 Shares of Common Stock (subject to adjustment)
Exhibit 2.8
EXECUTION COPY
NEITHER THIS WARRANT NOR THE COMMON STOCK WHICH MAY BE ACQUIRED UPON EXERCISE HEREOF HAS BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY APPLICABLE STATE
SECURITIES LAWS, AND MAY NOT BE SOLD, OFFERED FOR SALE, TRANSFERRED, ASSIGNED, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT WITH RESPECT THERETO UNDER THE
ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR AN EXEMPTION THEREFROM EXISTS.
| No. W – ▇▇-▇▇▇▇-▇▇ | Warrant to Purchase 1,315,542 Shares of Common Stock (subject to adjustment) |
This certifies that, for value received, BlueCrest Venture Finance Master Fund Limited, a
company organized under the laws of the Cayman Islands (“BlueCrest”), or its assigns (the “Holder”)
is entitled, subject to the terms set forth below, to purchase from Bioheart, Inc. (the “Company”),
a Florida corporation, up to 1,315,542 shares (the “Warrant Shares”) of the common stock of the
Company, par value $.001 per share (the “Common Stock”), as constituted on the date hereof (the
“Warrant Issue Date”), upon surrender hereof, at the principal office of the Company
referred to below, with the duly executed Notice of Exercise, attached hereto as Exhibit A
(the “Notice of Exercise Form”), and simultaneous payment therefor in lawful money of the United
States or otherwise as hereinafter provided, at the Exercise Price set forth in Section 2 below.
The number of Warrant Shares and the Exercise Price are subject to adjustment as provided below.
The term “Warrant” as used herein shall include this Warrant, and any warrants delivered in
substitution or exchange therefor as provided herein. This Warrant is issued in connection with
the Amendment to Loan and Security Agreement (the “Loan Agreement”), made as of April 2, 2009 by
and between BlueCrest and the Company.
1. Term of Warrant. Subject to the terms and conditions set forth herein, this
Warrant shall be exercisable, in whole or in part, at any time, or from time to time, during the
term commencing on the Warrant Issue Date and ending at 5:00 p.m., New York City time, on the ten
year anniversary of the Warrant Issue Date (the “Expiration Date”), and shall be void thereafter.
2. Exercise Price. The price at which this Warrant may be exercised shall be $0.5321
per share of Common Stock, as may be adjusted from time to time pursuant to Section 14 hereof (the
“Exercise Price”).
3. Exercise of Warrant.
(a) In accordance with the procedures set forth in Section 1(c) below, this Warrant may be
exercised, in whole or in part, at any time, or from time to time during the period commencing on
the date that is three hundred and sixty-six (366) days following the Warrant Issue Date (the
“One Year Exercise Date”).
(b) During the period that this Warrant is exercisable in accordance with Sections 1(a) above,
the Holder may exercise this Warrant by presentation and surrender of this Warrant and the delivery
of the Notice of Exercise Form duly completed and executed on behalf of the Holder and, if the date
of exercise is prior to an Initial Public Offering, the Shareholders Agreement, attached hereto as
Exhibit B, duly completed and executed on behalf of the Holder, at the principal office of
the Company (or such other office or agency of the Company as it may designate by notice in writing
to the Holder at the address of the Holder appearing on the books of the Company), accompanied by
payment of the Exercise Price for the number of shares specified in such Notice of Exercise Form.
Payment may be made (i) in cash or by certified or official bank check, payable to the order of the
Company, (ii) by cancellation by the Holder of indebtedness or other obligations of the Company to
the Holder, or (iii) by a combination of the consideration described in sub-clauses (i) and (ii)
above. Notwithstanding the foregoing, in the event that the Company undertakes undergoes a sale or
merger transaction, then (A) if the Fair Market Value (as defined in Section 3(d) below) of one
share of Common Stock is greater than the Exercise Price in effect on such date, then this Warrant
shall be deemed automatically exercised pursuant to Section 3(d) below or (B) if the Fair Market
Value of one Share is less than the Exercise Price in effect on such date, then this Warrant shall
automatically terminate and be of no further force and effect.
(c) This Warrant shall be deemed to have been exercised immediately prior to the close of
business on the date of its surrender for exercise as provided above, and the person entitled to
receive the Warrant Shares shall be treated for all purposes as the holder of record of such
Warrant Shares as of the close of business on such date. As promptly as practicable on or after
such date and in any event within ten (10) days thereafter, the Company at its expense shall issue
and deliver to the person or persons entitled to receive the same a certificate or certificates for
the number of shares issuable upon such exercise. In the event that this Warrant is exercised in
part, the Company at its expense will execute and deliver a new Warrant of like tenor exercisable
for the number of shares for which this Warrant may then be exercised.
(d) Net Issue Exercise. Notwithstanding any provisions herein to the contrary, if the
Fair Market Value of one share of Common Stock is greater than the Exercise Price (at the date of
calculation as set forth below), in lieu of making payment of the consideration provided for in
Section 3(a) above upon the exercise of all or any part of this Warrant, the Holder may surrender
this Warrant at the principal office of the Company, together with the duly executed Notice of
Exercise Form and, if the date of exercise is prior to the Initial Public Offering, the duly
executed Shareholders Agreement, in which event the Company shall issue to the Holder a number of
shares of Common Stock computed using the following formula:
X = Y (A – B)
A
A
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| X = | the number of shares of Common Stock to be issued to the Holder upon exercise | |||
| Y = | the number of shares of Common Stock purchasable under the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being exercised (at the date of such calculation) | |||
| A = | the Fair Market Value of one share of the Company’s Common Stock (at the date of such calculation) | |||
| B = | the Exercise Price (as adjusted to the date of such calculation) |
For purposes of the above calculation, the term “Fair Market Value” shall mean (i) if the principal
market for the Common Stock is The NASDAQ Stock Market or any other national securities exchange,
the last sales price of the Common Stock on such day as reported by such exchange or market, or on
a consolidated tape reflecting transactions on such exchange or market, (ii) if the principal
market for the Common Stock is not a national securities exchange or The NASDAQ Stock Market and
the Common Stock is quoted on the National Association of Securities Dealers Automated Quotations
System, the mean between the closing bid and the closing asked prices for the Common Stock on such
day as quoted on such System or (iii) if the Common Stock is not quoted on the National Association
of Securities Dealers Automated Quotations System, the mean between the highest bid and lowest
asked prices for the Common Stock on such day as reported by Pink Sheets LLC; provided, however,
that if none of (i), (ii) or (iii) above is applicable, or if no trades have been made or no quotes
are available for such day, the Fair Market Value of the Common Stock shall be reasonably
determined, in good faith, by the Board of Directors of the Company.
4. No Fractional Shares or Scrip. No fractional shares or scrip representing
fractional shares shall be issued upon the exercise of this Warrant. In lieu of any fractional
share to which the Holder would otherwise be entitled, the Company shall make a cash payment equal
to the Exercise Price multiplied by such fraction.
5. Replacement of Warrant. On receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of loss,
theft or destruction, on delivery of an indemnity agreement reasonably satisfactory in form and
substance to the Company or, in the case of mutilation, on surrender and cancellation of this
Warrant, the Company at its expense shall execute and deliver, in lieu of this Warrant, a new
warrant of like tenor and amount.
6. Rights of Shareholders. Subject to Sections 12, 14 and 16 of this Warrant, the
Holder shall not be entitled to vote or receive dividends or be deemed the holder of Common Stock
or any other securities of the Company that may at any time be issuable on the exercise hereof for
any purpose, nor shall anything contained herein be construed to confer upon the Holder, as such,
any of the rights of a shareholder of the Company or any right to vote for the election of
directors or upon any matter submitted to shareholders at any meeting thereof, or to give or
withhold consent to any corporate action (whether upon any recapitalization, issuance of stock,
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reclassification of stock, change of par value, or change of stock to no par value,
consolidation, merger, conveyance, or otherwise) or to receive notice of meetings, or to receive
dividends or subscription rights or otherwise until the Warrant shall have been exercised as
provided herein.
7. Transfer of Warrant.
(a) Warrant Register. The Company will maintain a register (the “Warrant Register”)
containing the names and addresses of the Holder or Holders. Any Holder of this Warrant or any
portion thereof may change his or her address as shown on the Warrant Register by written notice to
the Company, requesting such change. Any notice or written communication required or permitted to
be given to the Holder may be delivered or given by mail to such Holder as shown on the Warrant
Register and at the address shown on the Warrant Register. Until this Warrant is transferred on
the Warrant Register of the Company, the Company may treat the Holder as shown on the Warrant
Register as the absolute owner of this Warrant for all purposes, notwithstanding any notice to the
contrary.
(b) Warrant Agent. The Company may, by written notice to the Holder, appoint an agent
for the purpose of maintaining the Warrant Register referred to in Section 7(a) above, issuing the
Common Stock or other securities then issuable upon the exercise of this Warrant, exchanging this
Warrant, replacing this Warrant, or any or all of the foregoing. Thereafter, any such registration,
issuance, exchange, or replacement, as the case may be, shall be made at the office of such agent.
(c) Transferability and Nonnegotiability of Warrant.
(i) The Holder hereby acknowledges that neither this Warrant nor the Warrant
Shares have been registered under the Securities Act of 1933, as amended (the “Act”)
and are “restricted securities” under the Act inasmuch as they are being acquired in
a transaction not involving a public offering. The Holder hereby agrees not to
sell, transfer, assign, distribute, offer to sell, hypothecate or otherwise dispose
of this Warrant or the Warrant Shares in the absence of: (i) an effective
registration statement under the Act as to this Warrant or the Warrant Shares and
the registration and/or qualification of this Warrant or the Warrant Shares under
any applicable federal or state securities laws then in effect, or (ii) an exemption
therefrom exists.
(ii) Subject to compliance with Section 7(c)(i) above and the provisions of
Section 9(f) of this Warrant, this Warrant may be transferred by the Holder with
respect to any or all of the shares purchasable hereunder. Upon surrender of this
Warrant to the Company, together with the Assignment Form, attached hereto as
Exhibit C duly executed, and funds sufficient to pay any transfer tax, 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 the
Assignment Form and shall issue to the assignor a new Warrant evidencing the portion
of this Warrant not so assigned. Thereafter, this Warrant shall promptly be
cancelled. This Warrant may be divided or combined with other Warrants that carry
the same rights upon presentation hereof at the office of the
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Company or at the office of its stock transfer agent, if any, together with a
written notice specifying the names and denominations in which new Warrants are to
be issued and signed by the Holder hereof. Notwithstanding the foregoing, the
Company shall not be required to issue a Warrant covering less than 1,000 shares of
Common Stock.
8. Representations and Warranties of Company. In connection with the transactions
provided for herein, the Company hereby represents and warrants to the Holder that:
(a) Organization, Good Standing, and Qualification. The Company is a corporation duly
organized, validly existing, and in good standing under the laws of the State of Florida and has
all requisite corporate power and authority to carry on its business as now conducted. The Company
is duly qualified to transact business and is in good standing in each jurisdiction in which the
failure to so qualify would have a material adverse effect on its business or properties.
(b) Authorization. The Company has all necessary corporate power and authority to
execute, deliver and perform its obligations under this Warrant. All corporate action has been
taken on the part of the Company, its officers, directors, and shareholders necessary for the due
authorization, execution and delivery of this Warrant by the Company and the performance by the
Company of its obligations hereunder. This Warrant has been duly executed and delivered by the
Company and constitutes a legal, valid and binding obligation of the Company, enforceable against
the Company in accordance with its terms, except as may be limited by applicable bankruptcy,
insolvency, reorganization or similar laws relating to or affecting the enforcement of creditors’
rights. The Warrant Shares have been duly and validly authorized and reserved for issuance by the
Company.
(c) Compliance with Other Instruments. The authorization, execution and delivery of
this Warrant by the Company, the consummation of the transactions contemplated hereby and the
performance by the Company of its obligations hereunder will not (i) violate any judgment, order,
decree, injunction, law or regulation applicable to the Company; (ii) violate any term or provision
of the Articles of Incorporation (the “Articles”) or bylaws; (iii) violate, or result in a breach
or default under, any other agreement or instrument to which the Company is a party or by which it
is bound or to which its properties or assets are subject, except for such violations, breaches or
defaults under clauses (i), (ii) or (iii) above which, individually or in the aggregate, will not
result in a material adverse effect upon the business operations, properties, assets, results of
operations or condition (financial or otherwise) of the Company, the enforceability of any material
provision of this Warrant or the ability of the Holder to enforce its rights and remedies under
this Warrant; or (iv) result in the creation of any lien, claim or other encumbrance on any of the
property or other assets of the Company.
(d) Valid Issuance of Common Stock. When the Warrant Shares have been delivered in
accordance with the terms of this Warrant, such Warrant Shares will be duly authorized and validly
issued, fully paid and nonassessable.
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(e) Representations and Warranties in the Loan Agreement. As of the date hereof, each
of the representations and warranties made in the Loan Agreement by the Company are materially true
and correct.
9. Representations and Covenants of the Holder.
The Holder hereby represents and covenants to the Company that:
(a) This Warrant and any Warrant Shares purchased upon exercise of this Warrant will be
purchased for its own account for investment and not with a view to the offering or distribution
thereof within the meaning of the Act and any applicable state securities laws;
(b) The Holder has sufficient knowledge and expertise in financial and business matters so as
to be capable of evaluating the merits and risks of its investment in the Company. The Holder
understands that this investment involves a high degree of risk and could result in a substantial
or complete loss of its investment. The Holder is capable of bearing the economic risks of such
investment;
(c) The Holder is an “Accredited Investor” as such term is defined under Regulation D
promulgated pursuant to the Act;
(d) Any subsequent sale of any Warrant Shares shall be made either pursuant to an effective
registration statement under the Act and any applicable state securities laws, or pursuant to an
exemption from registration under the Act and any such state securities laws;
(e) If requested by the Company, the Holder shall submit a written statement, in form
reasonably satisfactory to the Company, to the effect that the representations set forth in
paragraphs (a) through (d) above are (x) true and correct as of the date of purchase of any Warrant
Shares hereunder or (y) true and correct as of the date of any sale of any Warrant Shares, as
applicable; and
(f) The Holder hereby agrees that, during the period of duration (not to exceed one hundred
eighty (180) days) specified by the Company and an underwriter of Common Stock or other securities
of the Company in an agreement in connection with any offering of the Company’s securities,
following the effective date of the registration statement for a public offering of the Company’s
securities filed under the Act, it shall not, to the extent requested by the Company and such
underwriter, directly or indirectly sell, offer to sell, contract to sell (including, without
limitation, any short sale), grant any option to purchase or otherwise transfer or dispose of
(other than to donees who agree to be similarly bound) any securities of the Company held by it at
any time during such period, except Common Stock, if any, included in such registration; provided,
that such “lock-up” period applicable to the Holder shall not be greater than the shortest lock-up
period restricting any other shareholder of the Company executing lock-up agreements in connection
with such registration (including ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇).
10. Legend. Unless the Warrant Shares or other securities issuable hereunder have
been registered under the Act, upon exercise of any of the Warrants and the issuance of any of the
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Warrant Shares or other securities, all certificates representing such securities shall bear
on the face thereof substantially the following legend:
“The securities represented by this certificate have not been registered under
the Securities Act of 1933, as amended (the “Securities Act”) and may not be sold
or transferred in the absence of an effective registration statement under the
Securities Act or an exemption from such registration. The securities
represented by this certificate are subject to certain restrictions and
agreements contained in, that certain Warrant Agreement dated April 2, 2009, by
and between BlueCrest Venture Finance Master Fund Limited and the Company and,
may not be sold, assigned, transferred, encumbered, pledged or otherwise disposed
of except upon compliance with the provisions of such Warrant Agreement. By the
acceptance of the shares of capital stock evidenced by this certificate, the
holder agrees to be bound by such Warrant Agreement and all amendments thereto.
A copy of such Warrant Agreement has been filed at the office of the Company.”
In the event the date the certificates referenced above are issued prior to an Initial Public
Offering, such certificates shall include the following additional legend:
“The securities represented by this certificate and the holder of such securities
are subject to the terms and conditions (including, without limitation, voting
agreements and restrictions on transfer) set forth in a Shareholders Agreement,
dated as of , 200___, a copy of which may be obtained from the Company. No
transfer of such securities will be made on the books of the Company unless
accompanied by evidence of compliance with the terms of such agreement.”
11. Reservation of Stock. The Company covenants that during the term this Warrant is
exercisable, the Company will reserve from its authorized and unissued Common Stock a sufficient
number of shares to provide for the issuance of Common Stock upon the exercise of this Warrant and,
from time to time, will take all steps necessary to amend its Articles to provide sufficient
reserves of shares of Common Stock issuable upon exercise of the Warrant. The Company further
covenants that all shares that may be issued upon the exercise of rights represented by this
Warrant and payment of the Exercise Price, all as set forth herein, will be free from all taxes,
liens and charges in respect of the issue thereof (other than taxes in respect of any transfer
occurring contemporaneously or otherwise specified herein). The Company agrees 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 shares of Common
Stock upon the exercise of this Warrant.
12. Notices.
(a) Whenever the Exercise Price or number of shares purchasable hereunder shall be adjusted
pursuant to Section 14 hereof, the Company shall issue a certificate signed by its Chief Executive
Officer or Chief Financial Officer setting forth, in reasonable detail, the event
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requiring the adjustment, the amount of the adjustment, the method by which such adjustment
was calculated, and the Exercise Price and number of shares purchasable hereunder after giving
effect to such adjustment, and shall cause a copy of such certificate to be mailed (by first-class
mail, postage prepaid) to the Holder of this Warrant.
(b) in case:
(i) The Company shall take a record of the holders of its Common Stock (or
other stock or securities at the time receivable upon the exercise of this Warrant)
for the purpose of entitling them to receive any dividend or other distribution, or
any right to subscribe for or purchase any shares of stock of any class or any other
securities, or to receive any other right, or
(ii) of any capital reorganization of the Company, any reclassification of the
capital stock of the Company, any consolidation or merger of the Company with or
into another corporation, or any conveyance of all or substantially all of the
assets of the Company to another corporation, or
(iii) of any voluntary dissolution, liquidation or winding-up of the Company,
(c) then, and in each such case, the Company will mail or cause to be mailed to the Holder or
Holders a notice specifying, as the case may be, (A) the date on which a record is to be taken for
the purpose of such dividend, distribution or right, and stating the amount and character of such
dividend, distribution or right, or (B) the date on which such reorganization, reclassification,
consolidation, merger, conveyance, dissolution, liquidation or winding-up is to take place, and the
time, if any is to be fixed, as of which the holders of record-of Common Stock (or such stock or
securities at the time receivable upon the exercise of this Warrant) shall be entitled to exchange
their shares of Common Stock (or such other stock or securities) for securities or other property
deliverable upon such reorganization, reclassification, consolidation, merger, conveyance,
dissolution, liquidation or winding-up. Such notice shall be mailed by overnight delivery at least
15 days prior to the date therein specified.
(d) All such notices, advices and communications shall be deemed to have been received (i) in
the case of personal delivery, on the date of such delivery and (ii) in the case of mailing, on the
next business day following the date of such mailing by overnight delivery.
13. Amendments.
(a) Any term of this Warrant may be amended with the written consent of the Company and the
Holder.
(b) No waivers of, or exceptions to, any term, condition or provision of this Warrant, in any
one or more instances, shall be deemed to be, or construed as, a further or continuing waiver of
any such term, condition or provision.
14. Adjustments. The Exercise Price and the number of Warrant Shares purchasable
hereunder are subject to adjustment from time to time as follows:
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(a) Reclassification, etc. In case of any reorganization of the Company (or any other
corporation, the securities of which are at the time receivable on the exercise of this Warrant)
after the Warrant Issue Date or in case after such date the Company (or any such other corporation)
shall consolidate with or merge into another corporation or convey all or substantially all of its
assets to another corporation, then, and in each such case, the Holder of this Warrant upon the
exercise thereof as provided herein at any time after the consummation of such reorganization,
consolidation, merger or conveyance, shall be entitled to receive, in lieu of the securities and
property receivable upon the exercise of this Warrant prior to such consummation, the securities or
property to which such Holder would have been entitled upon such consummation if such Holder had
exercised this Warrant immediately prior thereto; in each such case, the terms of this Warrant
shall be applicable to the securities or property receivable upon the exercise of this Warrant
after such consummation.
(b) Split, Subdivision or Combination of Shares. If the Company at any time while
this Warrant, or any portion hereof, remains outstanding and unexpired shall split, subdivide or
combine the securities as to which purchase rights under this Warrant exist, into a different
number of securities of the same class, the Exercise Price for such securities shall be
proportionately decreased in the case of a split or subdivision or proportionately increased in the
case of a combination.
(c) Adjustments for Dividends in Stock or Other Securities or Property. If while this
Warrant, or any portion hereof, remains outstanding and unexpired, the holders of the securities as
to which purchase rights under this Warrant exist at the time shall have received, or, on or after
the record date fixed for the determination of eligible shareholders, shall have become entitled to
receive, without payment therefor, other or additional stock or other securities or property (other
than cash) of the Company by way of dividend, then and in each case, this Warrant shall represent
the right to acquire, in addition to the number of shares of the security receivable upon exercise
of this Warrant, and without payment of any additional consideration therefor, the amount of such
other or additional stock or other securities or property (other than cash) of the Company that
such holder would hold on the date of such exercise had it been the holder of record of the
security receivable upon exercise of this Warrant on the date hereof and had thereafter, during the
period from the date hereof to and including the date of such exercise, retained such shares and/or
all other additional stock available by it as aforesaid during such period, giving effect to all
adjustments called for during such period by the provisions of this Section 14.
(d) Certificate as to Adjustments. Upon the occurrence of each adjustment or
readjustment pursuant to this Section 14, the Company at its expense shall promptly compute such
adjustment or readjustment in accordance with the terms hereof and furnish to each Holder of this
Warrant a certificate setting forth such adjustment or readjustment and showing in detail the facts
upon which such adjustment or readjustment is based. The Company shall, upon the written request,
at any time, of any such Holder, furnish or cause to be furnished to such Holder a like certificate
setting forth: (i) such adjustments and readjustments; (ii) the Exercise Price at the time in
effect; and (iii) the number of Warrant Shares and the amount, if any, of other property that at
the time would be received upon the exercise of the Warrant.
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(e) No Impairment. The Company will not, by any voluntary action, avoid or seek to
avoid the observance or performance of any of the terms to be observed or performed hereunder by
the Company, but will at all times in good faith assist in the carrying out of all the provisions
of this Section 14 and in the taking of all such action as may be reasonably necessary or
appropriate in order to protect the rights of the Holder of this Warrant against impairment.
15. Piggyback Registration Rights
15.1. If at any time during the period commencing on the Six Month Post-IPO Exercise Date and
ending on the Expiration Date (the “Piggyback Registration Period”), the Company
proposes to register any shares of its Common Stock under the Securities Act on any form for
registration thereunder (the “Registration Statement”) for its own account or the account
of shareholders (other than a registration solely relating to (i) shares of Common Stock underlying
a stock option, restricted stock, stock purchase or compensation or incentive plan or of stock
issued or issuable pursuant to any such plan, or a dividend investment plan; (ii) a registration of
securities proposed to be issued in exchange for securities or assets of, or in connection with a
merger or consolidation with, another corporation or other entity; or (iii) a registration of
securities proposed to be issued in exchange for other securities of the Company), it will at such
time give prompt written notice to the Holder of its intention to do so (the “Section 15.1
Notice”). Upon the written request of the Holder given to the Company within ten (10) days
after the giving of any Section 15.1 Notice setting forth the number of shares of Warrant Shares
intended to be disposed of by the Holder and the intended method of disposition thereof, the
Company will include or cause to be included in the Registration Statement the shares of Warrant
Shares which the Holder has requested to register, to the extent provided in this Section 15 (a
“Piggyback Registration”). Notwithstanding the foregoing, the Company may, at any time,
withdraw or cease proceeding with any registration pursuant to this Section 15.1 if it shall at the
same time withdraw or cease proceeding with the registration of all of the Common Stock originally
proposed to be registered. The Company shall be obligated to file and cause the effectiveness of
only one (1) Piggyback Registration; provided however, that to the extent that shares for which
registration is requested pursuant hereto are excluded under Section 15.5, such shares shall be
eligible for Piggyback Registration, notwithstanding the one Piggyback Registration limit. The
shares of Warrant Shares set forth in the Section 15.1 Notice are referred to for purposes of this
Section 15 as the “Registrable Shares”.
15.2 Company Covenants. Whenever required under this Section 15 to include
Registrable Shares in a Registration Statement, the Company shall, as expeditiously as reasonably
possible:
(a) Use its commercially reasonable efforts to cause such Registration Statement to become
effective and cause such Registration Statement to remain effective until the earlier of the Holder
having completed the distribution of all its Registrable Shares described in the Registration
Statement or six (6) months from the effective date of the Registration Statement (or such later
date by reason of suspensions the effectiveness as provided hereunder). The Company will also use
its commercially reasonable efforts to, during the period that such Registration Statement is
required to be maintained hereunder, file such post-effective amendments and supplements thereto as
may be required by the Securities Act and the rules and regulations thereunder or otherwise to
ensure that the Registration Statement does not contain any untrue
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statement of material fact or omit to state a fact required to be stated therein or necessary
to make the statements contained therein, in light of the circumstances under which they are made,
not misleading; provided, however, that if applicable rules under the Securities Act governing the
obligation to file a post-effective amendment permits, in lieu of filing a post-effective amendment
that (i) includes any prospectus required by Section 10(a)(3) of the Securities Act or (ii)
reflects facts or events representing a material or fundamental change in the information set forth
in the Registration Statement, the Company may incorporate by reference information required to be
included in (i) and (ii) above to the extent such information is contained in periodic reports
filed pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”) in the Registration Statement.
(b) Prepare and file with the Unites States Securities and Exchange Commission (the
“SEC”) such amendments and supplements to such Registration Statement, and the prospectus
used in connection with such Registration Statement, as may be necessary to comply with the
provisions of the Securities Act with respect to the disposition of all securities covered by such
Registration Statement.
(c) Furnish to the Holder such numbers of copies of a prospectus, including a preliminary
prospectus as amended or supplemented from time to time, in conformity with the requirements of the
Securities Act, and such other documents as it may reasonably request in order to facilitate the
disposition of Registrable Shares owned by the Holder; provided that, in no event, shall the
Company be required to incur printing expenses in excess of $1,000 in complying with its
obligations under this Section 15.2(c).
(d) Use its commercially reasonable efforts to register and qualify the securities covered by
such Registration Statement under such other federal or state securities laws of such jurisdictions
as shall be reasonably requested by the Holder; provided, however, that the Company shall not be
required in connection therewith or as a condition thereto to qualify to do business or to file a
general consent to service of process in any such states or jurisdictions, unless the Company is
already subject to service in such jurisdiction and except as may be required by the Securities
Act.
(e) In the event of any underwritten public offering, enter into and perform its obligations
under an underwriting agreement, in usual and customary form, with the managing underwriter of such
offering.
(f) Notify the Holder, at any time when a prospectus relating thereto is required to be
delivered under the Securities Act, (a) when the Registration Statement or any post-effective
amendment and supplement thereto has become effective; (b) of the issuance by the SEC of any stop
order or the initiation of proceedings for that purpose (in which event the Company shall make use
commercially reasonable efforts to obtain the withdrawal of any order suspending effectiveness of
the Registration Statement. at the earliest possible time or prevent the entry thereof); (c) of the
receipt by the Company of any notification with respect to the suspension of the qualification of
the Registrable Shares for sale in any jurisdiction or the initiation of any proceeding for such
purpose; and (d) of the happening of any event as a result of which the prospectus included in such
Registration Statement, as then in effect, includes an untrue statement of a material fact or omits
to state a material fact required to be stated therein or
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necessary to make the statements therein not misleading in the light of the circumstances then
existing.
(g) Cause all such Registrable Shares registered hereunder to be listed on each exchange or
quotation service on which similar securities issued by the Company are then listed or quoted.
(h) Provide a transfer agent and registrar for all Registrable Shares registered pursuant
hereunder and CUSIP number for all such Registrable Shares, in each case not later than the
effective date of such registration.
15.3 Furnish Information. In connection with a registration in which the Holder is
participating, such Holder agrees to execute and deliver such other agreements as may be reasonably
requested by the Company or the underwriter. In addition, if requested by the Company or the
representative of the underwriters of Common Stock (or other securities) of the Company, the Holder
shall provide, within ten (10) days of such request, such information related to such Holder as may
be required by the Company or such representative in connection with the completion of any public
offering of the Company’s securities pursuant to a registration statement filed under the
Securities Act.
15.4 Expenses of Company Registration. All expenses other than underwriting discounts
and commissions incurred in connection with registrations, filings or qualifications pursuant to
Section 15.1, including, without limitation, all registration, filing and qualification fees,
printers’ and accounting fees and fees, disbursements of counsel for the Company and disbursements
of counsel for the Holder up to $10,000 (the “Registration Expenses”) shall be borne by the
Company.
15.5 Underwriting Requirements. In connection with any offering involving an
underwriting of shares of the Company’s capital stock, the Company shall not be required under
Section 15.1 to include any of the Holder’s Registrable Shares in such underwriting unless the
Holder accepts the terms of the underwriting as agreed upon between the Company and the
underwriters selected by it (or by other persons entitled to select the underwriters), and then
only in such quantity as the underwriters determine in their sole and reasonable discretion will
not materially jeopardize the success of the offering by the Company, and the Holder enters into
such lock-up agreements as may be reasonably required of other selling shareholders in such
Registration Statement. If the total amount of securities, including Registrable Shares, requested
by shareholders to be included in such offering exceeds the amount of securities sold other than by
the Company that the underwriters determine in their sole and reasonable discretion is compatible
with the success of the offering, then the Company shall be required to include in the offering
only that number of such securities, including Registrable Shares, which the underwriters determine
in their sole and reasonable discretion will not materially jeopardize the success of the offering
(the securities so included to be apportioned pro rata among the selling shareholders according to
the total amount of securities entitled to be included therein owned by each selling shareholder or
in such other proportions as shall mutually be agreed to by such selling shareholders). For
purposes of the preceding parenthetical concerning apportionment, for any selling shareholder who
is a holder of Registrable Shares and is a partnership or corporation, the partners, retired
partners and shareholders of such holder, or the estates and family members
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of any such partners and retired partners and any trusts for the benefit of any of the
foregoing persons shall be deemed to be a single “selling shareholder”, and any pro-rata reduction
with respect to such “selling shareholder” shall be based upon the aggregate amount of shares
carrying registration rights owned by all entities and individuals included in such “selling
shareholder”, as defined in this sentence.
15.6 Indemnification. In the event that any Registrable Shares are included in a
Registration Statement under this Section 15.
(a) To the extent permitted by law, the Company will promptly indemnify and hold harmless the
Holder, any underwriter (as defined in the Securities Act) for the Holder and each person, if any,
who controls the Holder or underwriter within the meaning of the Securities Act or the Exchange
Act, against any losses, claims, damages, or liabilities (joint or several) to which they may
become subject under the Securities Act, or the Exchange Act, insofar as such losses, claims,
damages, or liabilities (or actions in respect thereof) arise out of or are based upon any of the
following statements, omissions or violations (collectively a “Violation”): (i) any untrue
statement or alleged untrue statement of a material fact contained in such Registration Statement,
including any preliminary prospectus or final prospectus contained therein or any amendments or
supplements thereto, (ii) the omission or alleged omission to state therein a material fact
required to be stated therein, or necessary to make the statements therein not misleading, or (iii)
any violation or alleged violation by the Company of the Securities Act, the Exchange Act, or any
rule or regulation promulgated under the Securities Act, or the Exchange Act, and the Company will
pay to the Holder, underwriter or controlling person, as incurred, any legal or other expenses
reasonably incurred by them in connection with investigating or defending any such loss, claim,
damage, liability, or action; provided, however, that the indemnity agreement contained in this
Section 15.6(a) shall not apply to amounts paid in settlement of any such loss, claim, damage,
liability, or action if such settlement is effected without the consent of the Company (which
consent shall not be unreasonably withheld), nor shall the Company be liable in any such case for
any such loss, claim, damage, liability, or action incurred by the Holder, underwriter or
controlling person to the extent that such party’s loss, claim, damage, liability or action arises
out of or is based upon a Violation which occurs in reliance upon and in conformity with written
information furnished expressly for use in connection with such registration by such party.
(b) To the extent permitted by law, the Holder will indemnify and hold harmless the Company,
its directors, officers, and each person, if any, who controls the Company within the meaning of
the Securities Act or the Exchange Act, any underwriter, any other holder selling securities in
such Registration Statement and any controlling person of any such underwriter or other holder,
against any losses, claims, damages, or liabilities (joint or several) to which any of the
foregoing persons may become subject, under the Securities Act, or the Exchange Act, insofar as
such losses, claims, damages, or liabilities (or actions in respect thereto) arise out of or are
based upon any Violation, in each case to the extent (and only to the extent) that such Violation
occurs in reliance upon and in conformity with written information furnished by the Holder
expressly for use in connection with such registration; and the Holder will pay, as incurred, any
legal or other expenses reasonably incurred by any person intended to be indemnified pursuant to
this Section 15.6(b), in connection with investigating or defending
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any such loss, claim, damage, liability, or action; provided, however, that
the indemnity agreement contained in this Section 15.6(b) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability or action if such settlement is effected
without the consent of the Holder, which consent shall not be unreasonably withheld;
provided, further, that, in no event shall any indemnity under this Section 15.6(b)
exceed 20% of the cash value of the gross proceeds from the offering received by the Holder.
(c) Promptly after receipt by an indemnified party under this Section 15.6 of notice of the
commencement of any action (including any governmental action), such indemnified party shall, if a
claim in respect thereof is to be made against any indemnifying party under this Section 15.6,
deliver to the indemnifying party a written notice of the commencement thereof and the indemnifying
party shall have the right to participate in, and, to the extent the indemnifying party so desires,
jointly with any other indemnifying party similarly notified, to assume the defense thereof with
counsel selected by the indemnifying party and approved by the indemnified party (whose approval
shall not be unreasonably withheld); provided, however, that an indemnified party (together with
all other indemnified parties which may be represented without conflict by one counsel) shall have
the right to retain one separate counsel, with the fees and expenses to be paid by the indemnifying
party, if representation of such indemnified party by the counsel retained by the indemnifying
party would be inappropriate due to actual or potential differing interests between such
indemnified party and any other party represented by such counsel in such proceeding. The failure
to deliver written notice to the indemnifying party within a reasonable time of the commencement of
any such action, if prejudicial to its ability to defend such action, shall relieve such
indemnifying party of any liability to the indemnified party under this Section 15.6, but the
omission so to deliver written notice to the indemnifying party will not relieve it of any
liability that it may have to any indemnified party otherwise than under this Section 15.6.
(d) If the indemnification provided for in this Section 15.6 is held by a court of competent
jurisdiction to be unavailable to an indemnified party with respect to any loss, liability, claim,
damage, or expense referred to therein, then the indemnifying party, in lieu of indemnifying such
indemnified party hereunder, shall contribute to the amount paid or payable by such indemnified
party as a result of such loss, liability, claim, damage, or expense in such proportion as is
appropriate to reflect the relative fault of the indemnifying party on the one hand and of the
indemnified party on the other in connection with the statements or omissions that resulted in such
loss, liability, claim, damage, or expense as well as any other relevant equitable considerations.
The relative fault of the indemnifying party and of the indemnified party shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement of a material fact
or the alleged omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties’ relative intent, knowledge, access
to information, and opportunity to correct or prevent such statement or omission.
(e) Notwithstanding the foregoing, to the extent that the provisions on indemnification and
contribution contained in the underwriting agreement entered into in connection with the
underwritten public offering are in conflict with the foregoing provisions, the provisions in the
underwriting agreement shall control.
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(f) The obligations of the Company and the Holder under this Section 15.6 shall survive the
completion of any offering of Registrable Shares in a Registration Statement under this Section 15,
and otherwise.
15.7. Reports Under Securities Exchange Act of 1934. With a view to making available
to the Holder the benefits of Rule 144 under the Securities Act (“Rule 144”) and any other
rule or regulation of the SEC that may at any time permit the Holder to sell shares of the
Company’s Common Stock to the public without registration, commencing immediately after the date on
which a registration statement filed by the Company under the Securities Act becomes effective, the
Company agrees to use its best efforts to:
(a) make and keep public information available, as those terms are understood and defined in
Rule 144;
(b) file with the SEC in a timely manner all reports and other documents required of the
Company under the Securities Act and the Exchange Act; and
(c) furnish to the Holder, so long as the Holder owns any Registrable Shares, forthwith upon
request (i) a copy of the most recent annual or quarterly report of the Company and such other
reports and documents so filed by the Company, and (ii) such other information as may be reasonably
requested in availing any Holder of any rule or regulation of the SEC which permits the selling of
any such securities without registration or pursuant to such form.
15.8. Permitted Transferees. The rights to cause the Company to register Registrable
Shares granted to the Holder by the Company under this Section 15 may be assigned in full by a
Holder in connection with a transfer by the Holder of its Registrable Shares or Warrants if: (a)
the Holder gives prior written notice to the Company; (b) such transferee agrees to comply with and
be bound by the terms and provisions of this Agreement; (c) such transfer is otherwise in
compliance with this Agreement and (d) such transfer is otherwise effected in accordance with
applicable securities laws. Except as specifically permitted by this Section 15.8, the rights of a
Holder with respect to Registrable Shares as set out herein shall not be transferable to any other
person, and any attempted transfer shall cause all rights of the Holder therein to be forfeited.
15.9 Termination of Registration Rights. The Holder shall no longer be entitled to
exercise any registration rights provided for in Section 15.1 after such time at which all
Registrable Shares held by the Holder can be sold in any three-month period without registration in
compliance with Rule 144 of the Act.
16. Information. So long as the Holder holds the Warrant and/or shares of Common
Stock, the Company shall deliver to the Holder, promptly after mailing, copies of all notices,
reports, financial statements, proxies or other written communication delivered or mailed to the
holders of the Common Stock.
17. Descriptive Headings. The description headings of the several sections and
paragraphs of this Warrant are inserted for convenience only and do not constitute a part of this
Warrant.
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18. Governing Law. This Warrant shall be construed and enforced under the laws of the
State of Florida without regard to conflicts of law provisions
19. Waiver of Jury Trial. THE COMPANY AND THE HOLDER HEREBY WAIVE THEIR RESPECTIVE
RIGHTS TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED UPON, OR RELATED TO, THE SUBJECT MATTER
OF THIS AGREEMENT. THIS WAIVER IS KNOWINGLY, INTENTIONALLY AND VOLUNTARILY MADE BY THE HOLDER AND
THE COMPANY.
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IN WITNESS WHEREOF, the parties have executed this Warrant as of the date set forth below.
Dated: April 2, 2009
| BLUECREST VENTURE FINANCE MASTER FUND LIMITED |
BIOHEART INC. | |||||||||
| acting through its duly appointed agent and investment manager, BlueCrest Capital Management LLP | ||||||||||
By:
|
/s/▇▇▇▇ ▇▇▇▇▇▇▇▇ | By: | /s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ | |||||||
| Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇ | Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ | |||||||||
| Title: General Counsel | Title: Chairman, CEO &CTO | |||||||||
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EXHIBIT A
NOTICE OF EXERCISE FORM
To: Bioheart Inc.
(1) The undersigned hereby (A) elects to purchase shares of Common Stock of
Bioheart Inc., pursuant to the provisions of Section 3(b) of the attached Warrant, and
tenders herewith payment of the purchase price for such shares in full, or (B) elects to
exercise this Warrant for the purchase of shares of Common Stock, pursuant to the
provisions of Section 3(d) of the attached Warrant.
(2) In exercising this Warrant, the undersigned hereby confirms and acknowledges that
the shares of Common Stock to be issued are being acquired solely for the account of the
undersigned and not as a nominee for any other party, and for investment, and that the
undersigned will not offer, sell or otherwise dispose of any such shares of Common Stock
except under circumstances that will not result in a violation of the Securities Act of
1933, as amended, or any applicable state securities laws.
(3) Please issue a certificate or certificates representing said shares of Common
Stock in the name of the undersigned or in such other name as is specified below:
(4) Please issue a new Warrant for the unexercised portion of the attached Warrant in
the name of the undersigned or in such other name as is specified below:
Date: |
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EXHIBIT B
FORM OF SHAREHOLDERS’ AGREEMENT
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EXHIBIT C
ASSIGNMENT FORM
FOR VALUE RECEIVED, the undersigned registered owner of this Warrant hereby sells, assigns and
transfers unto the Assignee named below all of the rights of the undersigned under the within
Warrant, with respect to the number of shares of Common Stock set forth below:
| Name of Assignee | Address | No. of Shares |
and does hereby irrevocably constitute and appoint Attorney to make such transfer on
the books of Bioheart Inc. maintained for the purpose, with full power of substitution in the
premises.
The undersigned also represents that, by assignment hereof, the Assignee acknowledges that this
Warrant and the shares of stock to be issued upon exercise hereof are being acquired for investment
and that the Assignee will not offer, sell or otherwise dispose of this Warrant or any shares of
stock to be issued upon exercise hereof except under circumstances which will not result in a
violation of the Securities Act of 1933, as amended, or any state securities laws. Further, the
Assignee has acknowledged that upon exercise of this Warrant, the Assignee shall, if requested by
the Company, confirm in writing, in a form satisfactory to the Company, that the shares of stock so
purchased are being acquired for investment and not with a view toward distribution or resale.
Name: |
||||
Dated:
|
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