Exhibit 4.1
Form of Letter Agreement dated April 18, 2003 between the Company and certain
investors in the April 2002 offering
Gender Sciences, Inc.
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April 18, 2003
Name
Address
City, State, Zip
Dear __________:
This Letter Agreement sets forth the understanding of Gender
Sciences, Inc., a New Jersey corporation (the "Company") and _______________ the
("Shareholder") with respect to certain of Shareholder's rights under the
Subscription Agreement for Purchase of Shares dated as of April __, 2002 (the
"Subscription Agreement") by and between the Company and Shareholder. For good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Company and Shareholder hereby agree as follows:
1. Issuance of Warrant. The Company is currently seeking to raise
funding through a $2,000,000 convertible note financing, the material terms of
which are set forth on Exhibit A attached hereto (the "New Financing"). Upon the
Company closing a minimum of $550,000 in connection with the New Financing (such
closing to be, except as otherwise provided herein, upon the material terms set
forth on Exhibit A attached hereto) the Company will issue Shareholder a
warrant, in the form attached hereto as Exhibit B (the "Warrant"), to purchase a
number of shares of the Company's common stock (the "Common Stock") equal to two
(2) times the number of shares of the Company's Common Stock (as adjusted for
the Company's February, 2003 1:25 reverse split) purchased by Shareholder under
the Subscription Agreement. Except as otherwise provided in the Warrant, the
Warrant will be exercisable for a period of three (3) years following the date
of issuance of the Warrant and have an exercise price per share of $0.50
(subject to adjustment as set forth in the Warrant). Shareholder acknowledges
and agrees that upon receipt of the Warrant Shareholder shall have no other
rights under the Subscription Agreement, and the Company shall have no other
obligations to the Shareholder under the Subscription Agreement, with respect to
(a) the convertible note financing completed by the Company in November 2002
and/or (b) the New Financing. Notwithstanding any other provision of this Letter
Agreement, the Company and Shareholder acknowledge and agree that the conversion
and warrant price of the New Financing may need to be adjusted to take into
account the issuance of the Warrant; provided, however, that in no event shall
the final conversion and warrant price of the New Financing be less than the
exercise price of the Warrant. The Company represents and warrants that (a) the
form of Warrant attached hereto as Exhibit B is the form of warrant to be issued
to investors in the New Financing, and (b) it will use best efforts to raise the
entire $2,000,000 contemplated by the New Financing summary of terms attached
hereto as Exhibit A.
2. Termination of Rights in Subscription Agreement. The parties
acknowledge and agree that upon Shareholder's receipt of the Warrant, all of
Shareholder's rights, and all of the Company's obligations, under Sections 12,
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14 and 15 of the Subscription Agreement shall immediately, and without any
further action by the parties hereto, terminate.
3. Consent to Issuance of Options. Shareholder hereby consents to
each issuance by the Company of options to purchase Common Stock to ▇▇▇▇▇▇ ▇▇▇▇,
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of the Subscription Agreement.
4. Full and Adequate Consideration. Shareholder acknowledges and
agrees that the issuance of the Warrant and the terms and conditions of this
Letter Agreement constitute full and adequate consideration for the agreements
set forth herein.
5. Registration Rights. Shareholder shall execute a counterpart
signature page to the Company's Amended and Restated Registration Rights
Agreement. Pursuant to such agreement Shareholder shall, with respect to (a) the
shares of Common Stock issuable upon exercise of the Warrant and (b) the shares
of Common Stock purchased under the Subscription Agreement, be entitled to
unlimited piggyback registration rights on registrations of the Company, subject
to the right of any underwriter retained by the Company to limit the number of
shares covered by any such registration.
6. General. Notwithstanding any other agreement, written or oral,
this Letter Agreement, together with all exhibits hereto, constitutes the entire
understanding between the parties on the subject matter hereof. Except as
otherwise provided herein, this Letter Agreement may be amended or modified only
by a writing executed by each of the parties hereto. This Letter Agreement and
the rights and obligations of the parties set forth herein shall be governed by,
construed and interpreted in accordance with the laws of the State of New
Jersey, without regard to conflicts of law principles. This Letter Agreement may
be executed in one or more counterparts, all of which when fully executed and
delivered by all parties and taken together shall constitute a single agreement,
binding against each of the parties. To the maximum extent permitted by law or
by any applicable governmental authority, this Letter Agreement may be signed
and transmitted by facsimile with the same validity as if it were an ink-signed
document. This Letter Agreement shall inure to the benefit of, and be binding
upon, the parties hereto and their respective successors and assigns. The
prevailing party in any action to enforce the terms of this Letter Agreement
shall be entitled to payment of its fees and expenses (including, without
limitation, attorneys' fees) incurred in connection with such action.
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IN WITNESS WHEREOF, the parties have executed this Letter Agreement,
effective as of the date set forth above.
"Company" GENDER SCIENCES, INC.
By: ________________________________
Print Name: ________________________
Title: _____________________________
"Shareholder" NAME
By: ________________________________
Print Name: ________________________
Title: _____________________________
(if applicable)
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APRIL 2002 INVESTORS # WARRANTS PRICE GRANT EXPIRATION
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▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ 200,000 $0.50 7/31/03 7/31/06
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ 200,000 $0.50 7/31/03 7/31/06
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 100,000 $0.50 7/31/03 7/31/06
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 40,000 $0.50 7/31/03 7/31/06
▇▇▇▇ ▇▇▇▇▇▇▇ 50,000 $0.50 7/31/03 7/31/06
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 50,000 $0.50 7/31/03 7/31/06
I.B.B. 40,000 $0.50 7/31/03 7/31/06
▇▇▇▇ ▇▇▇▇▇ 50,000 $0.50 7/31/03 7/31/06
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TOTAL APRIL 2002 WARRANTS 730,000
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