Exhibit 4.8
THE TERMS OF THIS WARRANT ARE SUBJECT TO THE TERMS OF A SUBSCRIPTION AGREEMENT,
COPIES OF WHICH ARE AVAILABLE FROM NEPHROS, INC. NEITHER THIS WARRANT NOR THE
SECURITIES FOR WHICH IT IS EXERCISABLE HAVE BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY
APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED
OR HYPOTHECATED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF A REGISTRATION
STATEMENT IN EFFECT WITH RESPECT TO SUCH SECURITIES UNDER THE SECURITIES ACT OR
AN EXEMPTION FROM THE SECURITIES ACT. ANY SUCH TRANSFER MAY ALSO BE SUBJECT TO
COMPLIANCE WITH APPLICABLE STATE SECURITIES LAWS AND THE LAWS OF OTHER
APPLICABLE JURISDICTIONS.
THE SALE, TRANSFER, ASSIGNMENT, PLEDGE, OR ENCUMBRANCE OF THE SECURITIES
REPRESENTED BY THIS CERTIFICATE AND THE RIGHTS OF THE HOLDER OF SUCH SECURITIES
IN RESPECT OF THE ELECTION OF DIRECTORS ARE SUBJECT TO THE TERMS AND CONDITIONS
OF A STOCKHOLDERS' AGREEMENT DATED AS OF MAY 17, 2000 AMONG NEPHROS, INC. AND
THE HOLDERS OF OUTSTANDING CAPITAL STOCK OF SUCH COMPANY. COPIES OF SUCH
AGREEMENT MAY BE OBTAINED AT NO COST BY WRITTEN REQUEST MADE BY THE HOLDER OF
RECORD OF THIS CERTIFICATE TO THE SECRETARY OF NEPHROS, INC.
NEPHROS, INC.
Class A Warrant for the Purchase of Shares of
Common Stock*
No. A-1 August 5, 2002
FOR VALUE RECEIVED, NEPHROS, INC., a Delaware corporation (the "Company"),
hereby certifies that Lancer Offshore, Inc. or its registered assigns (the
"Holder") is entitled to purchase from the Company, subject to the provisions of
this Warrant (the "Warrant"), at any time on or after the date hereof (the
"Initial Exercise Date"), and prior to 12:01 A.M., New York City time, on
December 1, 2007 (the "Termination Date"), 120,000 fully paid and non-assessable
shares of the Common Stock, $.001 par value, of the Company ("Common Stock"), at
an exercise price of $2.50 per share of Common Stock for an aggregate exercise
price of three hundred thousand dollars ($300,000) (the aggregate purchase price
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* [Please note: this Warrant was amended by the Settlement Agreement, dated
as of January 31, 2003, between Nephros, Inc. and Lancer Offshore, Inc.]
payable for the Warrant Shares hereunder is hereinafter sometimes referred to as
the "Aggregate Exercise Price"). The number of shares of Common Stock to be
received upon exercise of this Warrant and the price to be paid for each share
of Common Stock are subject to possible adjustment from time to time as
hereinafter set forth. The shares of Common Stock or other securities or
property deliverable upon such exercise as adjusted from time to time is
hereinafter sometimes referred to as the "Warrant Shares." The exercise price of
a share of Common Stock in effect at any time and as adjusted from time to time
is hereinafter sometimes referred to as the "Per Share Exercise Price." The Per
Share Exercise Price is subject to adjustment as hereinafter provided; in the
event of any such adjustment, the number of Warrant Shares shall also be
adjusted, by dividing the Aggregate Exercise Price by the Per Share Exercise
Price in effect immediately after such adjustment. The Aggregate Exercise Price
is not subject to adjustment except to the extent of any partial exercise of
this Warrant. This Warrant constitutes one in a series of warrants (the "Class A
Warrants") which includes this Warrant and any other Class A Warrants issued
pursuant to Section 1 and/or Section 2.2 of the Subscription Agreement dated as
of even date herewith (the "Subscription Agreement") by and among the Company
and the Purchasers (as defined in the Subscription Agreement).
1. Exercise of Warrant.
(a) This Warrant may be exercised in whole or in part, at any time by its
holder commencing on the Initial Exercise Date and prior to the Termination Date
by presentation and surrender of this Warrant, together with the duly executed
subscription form attached at the end hereof, at the address set forth in
Subsection 8(a) hereof, together with payment, by certified or official bank
check or wire transfer payable to the order of the Company, of the Aggregate
Exercise Price or the proportionate part thereof if exercised in part.
(b) If this Warrant is exercised in part only, the Company shall, upon
presentation of this Warrant upon such exercise, execute and deliver (along with
the certificate for the Warrant Shares purchased) a new Warrant evidencing the
rights of the Holder hereof to purchase the balance of the Warrant Shares
purchasable hereunder upon the same terms and conditions as herein set forth.
Upon proper exercise of this Warrant, the Company promptly shall deliver
certificates for the Warrant Shares to the Holder duly legended as authorized by
the subscription form. No fractional shares or scrip representing fractional
shares shall be issued upon exercise of this Warrant; provided that the Company
shall pay to the Holder of the Warrant cash in lieu of such fractional shares.
2. Reservation of Warrant Shares; Fully Paid Shares; Taxes. The Company
hereby represents that it has, and until expiration of this Warrant agrees that
it shall, reserve for issuance or delivery upon exercise of this Warrant, such
number of shares of the Common Stock as shall be required for issuance and/or
delivery upon exercise of this Warrant in full, and agrees that all Warrant
Shares so issued and/or delivered will be validly issued, fully paid and
non-assessable, and further agrees to pay all taxes (other than income taxes)
and charges that may be imposed upon such issuance and/or delivery. The Company
shall not, however, be required to pay any tax which may be payable in respect
of any transfer involved in the issue or delivery of Common Stock (or other
securities or assets) in a name other than that in which the Warrants so
exercised were registered, and no such issue or delivery shall be made unless
and until the person requesting such issue has paid to the Company the amount of
such tax or has established, to the satisfaction of the Company, that such tax
has been paid.
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3. Protection Against Dilution.
(a) 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 (each of (i) through (iv) an "Action"), the Per Share
Exercise Price shall be adjusted to be equal to a fraction, the numerator of
which shall be the Aggregate Exercise Price and the denominator of which shall
be the number of shares of Common Stock or other capital stock of the Company
that the Holder would have held (solely as a result of the exercise of this
Warrant and the operation of such Action) immediately following such Action if
this Warrant had been exercised immediately prior to such Action. An adjustment
made pursuant to this Subsection 3(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.
(b) In the event of any capital reorganization or reclassification, or any
consolidation or merger to which the Company is a party other than a merger or
consolidation in which the Company is the continuing corporation, 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, or in the case of any statutory
exchange of securities with another corporation (including any exchange effected
in connection with a merger of a third corporation into the Company), the Holder
of this Warrant shall have the right thereafter to receive on the exercise of
this Warrant 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, statutory exchange,
sale or conveyance had this Warrant been exercised immediately prior to the
effective date of such reorganization, reclassification, consolidation, merger,
statutory exchange, sale or conveyance and in any such case, if necessary,
appropriate adjustment shall be made in the application of the provisions set
forth in this Section 3 with respect to the rights and interests thereafter of
the Holder of this Warrant to the end that the provisions set forth in this
Section 3 shall thereafter correspondingly be made applicable, as nearly as may
reasonably be, in relation to any shares of stock or other securities or
property thereafter deliverable on the exercise of this Warrant. The above
provisions of this Subsection 3(b) shall similarly apply to successive
reorganizations, reclassifications, consolidations, mergers, statutory
exchanges, sales or conveyances.
(c) Whenever the Per Share Exercise Price payable upon exercise of this
Warrant is adjusted pursuant to this Section 3, the number of shares of Common
Stock underlying this Warrant shall simultaneously be adjusted to equal the
number obtained by dividing the Aggregate Exercise Price (as the same shall be
reduced to the extent of any partial exercise of this Warrant) by the adjusted
Per Share Exercise Price.
(d) If, as a result of an adjustment made pursuant to this Section 3, the
Holder shall become entitled to receive, upon exercise of the Warrant, 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) shall determine the allocation of the
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adjusted Per Share Exercise Price between or among shares or such classes of
capital stock or shares of Common Stock and other capital stock.
4. Limited Transferability. This Warrant may not be sold, transferred,
assigned or hypothecated by the Holder except in compliance with the provisions
of the Act and the applicable state securities "blue sky" laws, and is so
transferable only upon the books of the Company which it shall cause to be
maintained for such purpose. The Company may treat the registered Holder of this
Warrant as he or it appears on the Company's books at any time as the Holder for
all purposes.
5. Loss, etc., of Warrant. Upon receipt of evidence satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant, and of
indemnity reasonably satisfactory to the Company (which may include a bond), if
lost, stolen or destroyed, and upon surrender and cancellation of this Warrant,
if mutilated, the Company shall execute and deliver to the Holder a new Warrant
of like date, tenor and denomination.
6. Investment Intent.
(a) The Holder represents, by accepting this Warrant, that it understands
that this Warrant and any securities obtainable upon exercise of this Warrant
have not been registered for sale under Federal or state securities laws and are
being offered and sold to the Holder pursuant to one or more exemptions from the
registration requirements of such securities laws. The Holder is an "accredited
investor" within the meaning of Regulation D under the Securities Act of 1933,
as amended (the "Act"). In the absence of an effective registration of such
securities or an exemption therefrom, any certificates for such securities shall
bear the legend set forth on the first page hereof. The Holder understands that
it must bear the economic risk of its investment in this Warrant and any
securities obtainable upon exercise of this Warrant for an indefinite period of
time, as this Warrant and such securities have not been registered under Federal
or state securities laws and therefore cannot be sold unless subsequently
registered under such laws, unless as exemption from such registration is
available.
(b) The Holder, by its acceptance of its Warrant, represents to the Company
that it is acquiring this Warrant and will acquire any securities obtainable
upon exercise of this Warrant for its own account for investment and not with a
view to, or for sale in connection with, any distribution thereof in violation
of the Act. The Holder agrees that this Warrant and any such securities will not
be sold or otherwise transferred unless (i) a registration statement with
respect to such transfer is effective under the Act and any applicable state
securities laws or (ii) such sale or transfer is made pursuant to one or more
exemptions from the Act.
7. Status of Holder. This Warrant does not confer upon the Holder any right
to vote or to consent to or receive notice as a stockholder of the Company, as
such, in respect of any matters whatsoever, or any other rights or liabilities
as a stockholder, prior to the exercise hereof.
8. Notices. No notice or other communication under this Warrant shall be
effective unless, but any notice or other communication shall be effective and
shall be deemed to
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have been given if, the same is in writing and is mailed by first-class mail,
postage prepaid, addressed to:
(a) the Company c/o Audubon Business and Technology Center,
Columbia-Presbyterian Medical Center, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: President, or such other address as the Company has designated
in writing to the Holder; or
(b) the Holder at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, Antilles,
Attention: Investment Manager, or such other address as the Holder has
designated in writing to the Company.
9. Headings. The headings of this Warrant have been inserted as a matter of
convenience and shall not affect the construction hereof.
10. Applicable Law. This Warrant shall be governed by and construed in
accordance with the law of the State of New York without giving effect to
principles of conflicts of law thereof.
11. Amendments. This Warrant may be amended only by mutual written
agreement of the Company and the holder or holders holding Class A Warrants
exercisable for a majority of the shares of Common Stock issuable upon exercise
of all then-outstanding Class A Warrants (the "Majority Holders"), and the
Company may take any action herein prohibited or omit to take any action herein
required to be performed by it, and any breach of any covenant, agreement,
warranty or representation may be waived, only if the Company has obtained the
written consent or waiver of the Majority Holders.
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IN WITNESS WHEREOF, the undersigned, acting for and on behalf of the
Company, has executed this Warrant as of the date first written above.
NEPHROS, INC.
By:/s/ ▇▇▇▇▇▇ ▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇▇▇▇▇
Title: President and Chief Executive
Officer
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SUBSCRIPTION
The undersigned, , pursuant to the
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provisions of the foregoing Warrant, hereby elects to exercise the within
Warrant to the extent of purchasing shares of Common Stock thereunder
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and hereby makes payment of $ by certified or official bank check in
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payment of the exercise price therefor.
Dated: Signature:
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Address:
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ASSIGNMENT
FOR VALUE RECEIVED hereby sells,
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assigns and transfers unto the foregoing
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Warrant and all rights evidenced thereby, and does irrevocably constitute and
appoint , attorney, to transfer said Warrant on the
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books of Nephros, Inc.
Dated: Signature:
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Address:
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PARTIAL ASSIGNMENT
FOR VALUE RECEIVED hereby assigns and transfers
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unto the right to purchase shares of the
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Common Stock, no par value per share, of Nephros, Inc. covered by the foregoing
Warrant, and a proportionate part of said Warrant and the rights evidenced
thereby, and does irrevocably constitute and appoint ,
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attorney, to transfer that part of said Warrant on the books of Nephros, Inc.
Dated: Signature:
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Address:
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