THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF HAVE
NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AND MAY NOT
BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED ABSENT AN EFFECTIVE
REGISTRATION THEREOF UNDER SUCH ACT OR COMPLIANCE WITH AN AVAILABLE EXEMPTION
FROM REGISTRATION. THE COMPANY MAY REFUSE TO AUTHORIZE ANY TRANSFER OF THE
SECURITIES IN RELIANCE ON AN EXEMPTION FROM REGISTRATION UNTIL IT HAS RECEIVED
AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH
REGISTRATION IS NOT REQUIRED.
THE COMPANY IS AUTHORIZED TO ISSUE MORE THAN ONE CLASS OF STOCK OR MORE THAN ONE
SERIES OF ANY CLASS OF STOCK. THE DESIGNATIONS, PREFERENCES AND RELATIVE,
PARTICIPATING, OPTIONAL OR OTHER SPECIAL RIGHTS OF THE SHARES OF EACH CLASS OR
SERIES THEREOF AND THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH
RIGHTS, ARE SET FORTH IN THE ARTICLES OF INCORPORATION OF THE COMPANY. A COPY OF
SAID ARTICLES OF INCORPORATION WILL BE FURNISHED FREE OF CHARGE TO THE HOLDER OF
THIS CERTIFICATE UPON WRITTEN REQUEST TO THE SECRETARY OF THE COMPANY.
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF MAY BE
TRANSFERRED ONLY IN ACCORDANCE WITH THE TERMS OF AN AGREEMENT BETWEEN THE
COMPANY AND THE HOLDER, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE
COMPANY.
SERIES B WARRANT TO PURCHASE
SHARES OF COMMON STOCK
OF
BIOFORCE NANOSCIENCES HOLDINGS, INC.
Expires August 31, 2012
No.: W-B-07-__ Number of Shares: _______
Date of Issuance: August 31, 2007
FOR VALUE RECEIVED, the undersigned, BioForce Nanosciences Holdings, Inc.,
a Nevada corporation (together with its successors and assigns, the "Issuer"),
hereby certifies that ___________ or its registered assigns is entitled to
subscribe for and purchase, during the Term (as hereinafter defined), up to
____________ (________) shares (subject to adjustment as hereinafter provided,
the "Warrant Share Number") of the duly authorized, validly issued, fully paid
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and non-assessable Common Stock of the Issuer, at an exercise price per share
equal to the Warrant Price then in effect, subject, however, to the provisions
and upon the terms and conditions hereinafter set forth. Capitalized terms used
in this Warrant and not otherwise defined herein shall have the respective
meanings specified in Section 9 hereof.
1. Term. The term of this Warrant shall commence on August 31, 2007 and
shall expire at 6:00 p.m., eastern time, on August 31, 2012 (such period being
the "Term").
2. Method of Exercise; Payment; Issuance of New Warrant; Transfer and
Exchange.
(a) Time of Exercise. The purchase rights represented by this Warrant may
be exercised in whole or in part during the Term.
(b) Method of Voluntary Exercise. The Holder hereof may exercise this
Warrant, in whole or in part, by the surrender of this Warrant (with the
exercise form attached hereto duly executed) at the principal office of the
Issuer, and by the payment to the Issuer of an amount of consideration therefor
equal to the Warrant Price in effect on the date of such exercise multiplied by
the number of shares of Warrant Stock with respect to which this Warrant is then
being exercised (the "Exercise Price"), payable at such Holder's election (i) by
certified or official bank check or by wire transfer to an account designated by
the Issuer, (ii) by "cashless exercise" in accordance with the provisions of
subsection (c) of this Section 2, but only when a registration statement under
the Securities Act providing for the resale of the Warrant Stock is not then in
effect, or (iii) by a combination of the foregoing methods of payment selected
by the Holder of this Warrant.
(c) Voluntary Cashless Exercise. Except for any exercises pursuant to
Section 2(f), and commencing one (1) year following the Original Issue Date if
(i) the Per Share Market Value of one share of Common Stock is greater than the
Warrant Price (at the date of calculation as set forth below) and (ii) a
registration statement under the Securities Act providing for the resale of the
Warrant Stock is not in effect pursuant to and in accordance with the terms of
the Registration Rights Agreement on the date the Holders desires to exercise
this Warrant, unless the registration statement is not effective as a result of
the Issuer exercising its rights under Section 3(n) of the Registration Rights
Agreement, in lieu of exercising this Warrant by payment of cash, the Holder may
exercise this Warrant by a cashless exercise and shall receive the number of
restricted shares of Common Stock equal to an amount (as determined below) by
surrender of this Warrant at the principal office of the Issuer together with
the properly endorsed Notice of Exercise in which event the Issuer shall issue
to the Holder a number of restricted shares of Common Stock computed using the
following formula:
X = Y - (A)(Y)
------
B
Where X = the number of restricted shares of Common Stock to be issued
to the Holder.
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Y = the number of shares of Common Stock purchasable upon
exercise of all of the Warrant or, if only a portion of the
Warrant is being exercised, the portion of the Warrant being
exercised.
A = the Warrant Price.
B = the Per Share Market Value of one share of Common Stock.
(d) Issuance of Stock Certificates. In the event of any exercise of this
Warrant in accordance with and subject to the terms and conditions hereof,
certificates for the shares of Warrant Stock so purchased shall be dated the
date of such exercise and delivered to the Holder hereof within a reasonable
time, not exceeding three (3) Trading Days after the Issuer and its transfer
agent have received from the Holder this Warrant, a duly executed exercise form,
the Exercise Price and all fees and expenses required hereby in support of such
exercise (the "Delivery Date") or, at the request of the Holder (provided that a
registration statement under the Securities Act providing for the resale of the
Warrant Stock is then in effect), issued and delivered to the Depository Trust
Company ("DTC") account on the Holder's behalf via the Deposit Withdrawal Agent
Commission System ("DWAC") no later than the Delivery Date, and the Holder
hereof shall be deemed for all purposes to be the holder of the shares of
Warrant Stock so purchased as of the date of such exercise. Notwithstanding the
foregoing to the contrary, the Issuer or its transfer agent shall only be
obligated to issue and deliver the shares to the DTC on the Holder's behalf via
DWAC if such exercise is in connection with a sale and the Issuer and its
transfer agent are participating with DTC through the DWAC system. The Holder
shall deliver this original Warrant (or an indemnification undertaking with
respect to such Warrant in the case of its loss, theft or destruction), along
with a duly executed exercise form, the Exercise Price and all fees and expenses
required hereby in support of such exercise, at such time that this Warrant is
exercised. If this Warrant shall have been exercised in part, the Issuer shall
deliver to the Holder by the Delivery Date a new Warrant evidencing the rights
of Holder to purchase the unpurchased Warrant Shares called for by this Warrant,
which new Warrant shall in all other respects be identical with this Warrant.
(e) Compensation for Buy-In on Failure to Timely Deliver Certificates Upon
Exercise. In addition to any other rights available to the Holder, if the Issuer
fails to cause its transfer agent to transmit to the Holder a certificate or
certificates representing the Warrant Stock issuable pursuant to an exercise
(the "Exercise Shares") on or before the Delivery Date and the Issuer or its
transfer agent are solely at fault for such failure, and if after such date the
Holder is required by its broker to purchase (in an open market transaction or
otherwise) shares of Common Stock (the "Substitute Shares") to deliver in
satisfaction of a sale by the Holder of the Exercise Shares (a "Buy-In"), then
the Issuer shall (1) pay in cash to the Holder the amount by which (x) the
Holder's total purchase price (including brokerage commissions, if any) for the
Substitute Shares exceeds (y) the amount obtained by multiplying (A) the number
of Exercise Shares by (B) the per share price at which the Holder was to sell
shares of Common Stock in the Buy-In (pursuant to the executed sell order
associated with the Buy-In), and (2) at the option of the Holder, either
reinstate to the Warrant the number of Exercise Shares not transmitted to the
Holder on or before the Delivery Date or deliver the Exercise Shares to the
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Holder. For example, if the Holder purchases Common Stock having a total
purchase price of $11,000 to cover a Buy-In for the sale of Exercise Shares for
$10,000, under clause (1) of the immediately preceding sentence the Issuer shall
be required to pay the Holder $1,000. The Holder shall provide the Issuer
written notice indicating the amounts payable to the Holder in respect of the
Buy-In, together with applicable confirmations and other evidence reasonably
requested by the Issuer. Nothing herein shall limit a Holder's right to pursue
any other remedies available to it hereunder, at law or in equity including,
without limitation, a decree of specific performance and/or injunctive relief
with respect to the Issuer's failure to timely deliver certificates representing
the Exercise Shares as required pursuant to the terms hereof.
(f) Mandatory Exercise.
(i) Notwithstanding anything herein to the contrary, commencing at
any time, this Warrant shall automatically convert into shares of Common
Stock if (A) the average VWAP (as defined below) of the Common Stock has
been greater than the Forced Conversion Price (as may be adjusted for any
stock splits or combinations of the Common Stock) for a period of thirty
(30) consecutive Trading Days immediately prior to the date of delivery of
the Conversion Notice (a "Conversion Notice Period") and (B) the trading
volume of the Common Stock for each Trading Day of such thirty (30)
Trading Day period exceeds 75,000 shares of Common Stock, by providing the
Holder of this Warrant written notice pursuant to Section 13 hereof (the
"Conversion Notice"); provided, that if the Holder would otherwise be
unable to exercise this Warrant as a result of the restrictions contained
in Section 7 hereof, the Conversion Notice shall be deemed null and void
and shall not be deemed effective until the date that the Holder may
exercise this Warrant in accordance with Section 7 hereof. For purposes
hereof, "VWAP" means, for any date, (i) the daily volume weighted average
price of the Common Stock for such date on the OTC Bulletin Board as
reported by Bloomberg Financial L.P. (based on a trading day from 9:30
a.m. Eastern Time to 4:02 p.m. Eastern Time); (ii) if the Common Stock is
not then listed or quoted on the OTC Bulletin Board and if prices for the
Common Stock are then reported in the "Pink Sheets" published by the Pink
Sheets, LLC (or a similar organization or agency succeeding to its
functions of reporting prices), the most recent bid price per share of the
Common Stock so reported; or (iii) in all other cases, the fair market
value of a share of Common Stock as determined in accordance with the
definition of Per Share Market Value.
(ii) On the Mandatory Exercise Date, this Warrant (and all
substitute, replacement or successor Warrants issued hereto) shall be
converted into shares of Common Stock automatically without any further
action by the Holder and whether or not this Warrant is surrendered to the
Company or its transfer agent. Upon receipt of the Conversion Notice, the
Holder shall promptly (but in no event later than three (3) Trading Days
following such receipt) pay the Exercise Price (in the manner described in
Section 2(b)) and surrender this Warrant to the Company. Upon receipt of
the Exercise Price and this Warrant, the Company shall cause its transfer
agent to deliver the shares of Common Stock issuable upon such exercise
(in the same manner set forth in Section 2(d).
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(g) Transferability of Warrant. Subject to Section 2(i) hereof, this
Warrant may be transferred by a Holder, in whole or in part, without the consent
of the Issuer. If transferred pursuant to this paragraph, this Warrant may be
transferred on the books of the Issuer by the Holder hereof in person or by duly
authorized attorney, upon surrender of this Warrant at the principal office of
the Issuer, properly endorsed (by the Holder executing an assignment in the form
attached hereto) and upon payment of any necessary transfer tax or other
governmental charge imposed upon such transfer. This Warrant is exchangeable at
the principal office of the Issuer for new Warrants to purchase the same
aggregate number of shares of Warrant Stock, each new Warrant to represent the
right to purchase such number of shares of Warrant Stock as the Holder shall
designate at the time of such exchange. All Warrants issued on transfers or
exchanges shall be dated the Original Issue Date and shall be identical with
this Warrant except as to the number of shares of Warrant Stock issuable
pursuant thereto.
(h) Intentionally Omitted.
(i) Compliance with Securities Laws.
(i) The Holder of this Warrant, by acceptance hereof, acknowledges
that this Warrant and the shares of Warrant Stock to be issued upon
exercise hereof are being acquired solely for the Holder's own account and
not as a nominee for any other party, and for investment, and that the
Holder will not offer, sell or otherwise dispose of this Warrant or any
shares of Warrant Stock to be issued upon exercise hereof except pursuant
to an effective registration statement, or an exemption from registration,
under the Securities Act and any applicable state securities laws.
(ii) Except as provided in paragraph (iii) below, this Warrant and
all certificates representing shares of Warrant Stock issued upon exercise
hereof shall be stamped or imprinted with a legend in substantially the
following form:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AND MAY NOT BE SOLD,
TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED ABSENT AN EFFECTIVE
REGISTRATION THEREOF UNDER SUCH ACT OR COMPLIANCE WITH AN AVAILABLE
EXEMPTION FROM REGISTRATION. THE COMPANY MAY REFUSE TO AUTHORIZE ANY
TRANSFER OF THE SECURITIES IN RELIANCE ON AN EXEMPTION FROM
REGISTRATION UNTIL IT HAS RECEIVED AN OPINION OF COUNSEL,
SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION
IS NOT REQUIRED.
THE COMPANY IS AUTHORIZED TO ISSUE MORE THAN ONE CLASS OF STOCK OR
MORE THAN ONE SERIES OF ANY CLASS OF STOCK. THE DESIGNATIONS,
-5-
PREFERENCES AND RELATIVE, PARTICIPATING, OPTIONAL OR OTHER SPECIAL
RIGHTS OF THE SHARES OF EACH CLASS OR SERIES THEREOF AND THE
QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH RIGHTS, ARE SET
FORTH IN THE ARTICLES OF INCORPORATION OF THE COMPANY. A COPY OF
SAID ARTICLES OF INCORPORATION WILL BE FURNISHED FREE OF CHARGE TO
THE HOLDER OF THIS CERTIFICATE UPON WRITTEN REQUEST TO THE SECRETARY
OF THE COMPANY.
THE SECURITIES REPRESENTED HEREBY MAY BE TRANSFERRED ONLY IN
ACCORDANCE WITH THE TERMS OF AN AGREEMENT BETWEEN THE COMPANY AND
THE STOCKHOLDER, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF
THE COMPANY.
(iii) The Issuer agrees to reissue this Warrant or certificates
representing any shares of the Warrant Stock without the legend set forth
above, if at such time, prior to making any transfer of any such
securities, the Holder shall give written notice to the Issuer describing
the manner and terms of such transfer. Such proposed transfer will not be
effected until: (a) either (i) the Issuer has received an opinion of
counsel reasonably satisfactory to the Issuer, to the effect that the
registration of such securities under the Securities Act is not required
in connection with such proposed transfer, (ii) a registration statement
under the Securities Act covering such proposed disposition has been filed
by the Issuer with the Securities and Exchange Commission and has become
effective under the Securities Act and the Holder has represented that the
shares of Warrant Stock have been or will be sold, (iii) the Issuer has
received other evidence reasonably satisfactory to the Issuer that such
registration and qualification under the Securities Act and state
securities laws are not required, or (iv) the Holder provides the Issuer
with reasonable assurances that such security can be sold pursuant to Rule
144 under the Securities Act; and (b) either (i) the Issuer has received
an opinion of counsel, reasonably satisfactory to the Issuer, to the
effect that registration or qualification under the securities or "blue
sky" laws of any state is not required in connection with such proposed
disposition, or (ii) compliance with applicable state securities or "blue
sky" laws has been effected or a valid exemption exists with respect
thereto. The Issuer will respond to any such notice from the Holder within
three (3) Trading Days. In the case of any proposed transfer under this
Section 2(h), the Issuer will use reasonable efforts to comply with any
such applicable state securities or "blue sky" laws, but shall in no event
be required, (x) to qualify to do business in any state where it is not
then qualified, (y) to take any action that would subject it to tax or to
the general service of process in any state where it is not then subject,
or (z) to comply with state securities or "blue sky" laws of any state for
which registration by coordination is unavailable to the Issuer. The
restrictions on transfer contained in this Section 2(h) shall be in
-6-
addition to, and not by way of limitation of, any other restrictions on
transfer contained in any other section of this Warrant. Whenever a
certificate representing the shares of Warrant Stock is required to be
issued to a the Holder without a legend, in lieu of delivering physical
certificates representing the shares of Warrant Stock, the Issuer shall
use its reasonable best efforts to cause its transfer agent to
electronically transmit the shares of Warrant Stock to the Holder by
crediting the account of the Holder's prime broker with DTC through its
DWAC system (to the extent not inconsistent with any provisions of this
Warrant or the Purchase Agreement). Notwithstanding the foregoing to the
contrary, the Issuer or its transfer agent shall only be obligated to
issue and deliver the shares to the DTC on the Holder's behalf via DWAC if
such exercise is in connection with a sale and the Issuer and its transfer
agent are participating in DTC through the DWAC system.
(j) Accredited Investor Status. In no event may the Holder exercise this
Warrant in whole or in part unless the Holder is an "accredited investor" as
defined in Regulation D under the Securities Act.
3. Stock Fully Paid; Reservation and Listing of Shares; Covenants.
(a) Stock Fully Paid. The Issuer represents, warrants, covenants and
agrees that all shares of Warrant Stock which may be issued upon the exercise of
this Warrant or otherwise hereunder will, when issued in accordance with the
terms of this Warrant, be duly authorized, validly issued, fully paid and
nonassessable and free from all taxes, liens and charges created by or through
the Issuer. The Issuer further covenants and agrees that during the period
within which this Warrant may be exercised, the Issuer will at all times have
authorized and reserved for the purpose of issuance upon exercise of this
Warrant a sufficient number of shares of Common Stock to provide for the
exercise of this Warrant.
(b) Listing. The Issuer shall list the shares of Warrant Stock on the OTC
Bulletin Board (or any other securities exchange, quotation system or market, if
any, on which shares of Common Stock issued by the Company are then listed or
traded), all in accordance with the terms of the Registration Rights Agreement.
(c) Covenants. The Issuer shall not by any action including, without
limitation, amending the Articles of Incorporation or the by-laws of the Issuer,
or through any reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities or any other action, avoid or seek to
avoid the observance or performance of any of the terms of this Warrant, but
will at all times in good faith assist in the carrying out of all such terms and
in the taking of all such actions as may be necessary or appropriate to protect
the rights of the Holder hereof against dilution (to the extent specifically
provided herein) or impairment. Without limiting the generality of the
foregoing, the Issuer will (i) not permit the par value, if any, of its Common
Stock to exceed the then effective Warrant Price, (ii) not amend or modify any
provision of the Articles of Incorporation or by-laws of the Issuer in any
manner that would adversely affect the rights of the Holders of the Warrants,
(iii) take all such action as may be reasonably necessary in order that the
Issuer may validly and legally issue fully paid and nonassessable shares of
Common Stock, free and clear of any liens, claims, encumbrances and restrictions
-7-
(other than as provided herein) upon the exercise of this Warrant, and (iv) use
its best efforts to obtain all such authorizations, exemptions or consents from
any public regulatory body having jurisdiction thereof as may be reasonably
necessary to enable the Issuer to perform its obligations under this Warrant.
(d) Loss, Theft, Destruction of Warrants. Upon receipt of evidence
satisfactory to the Issuer of the ownership of and the loss, theft, destruction
or mutilation of any Warrant and, in the case of any such loss, theft or
destruction, upon receipt of indemnity or security satisfactory to the Issuer
or, in the case of any such mutilation, upon surrender and cancellation of such
Warrant, the Issuer will make and deliver, in lieu of such lost, stolen,
destroyed or mutilated Warrant, a new Warrant of like tenor and representing the
right to purchase the same number of shares of Common Stock.
4. Adjustment of Warrant Price and Number of Shares Issuable Upon
Exercise. The Warrant Price and the Warrant Share Number shall be subject to
adjustment from time to time as set forth in this Section 4. The Issuer shall
give the Holder notice of any event described below which requires an adjustment
pursuant to this Section 4 in accordance with the notice provisions set forth in
Section 5.
(a) Recapitalization, Reorganization, Reclassification, Consolidation,
Merger or Sale.
(i) In case the Issuer after the Original Issue Date shall do any of
the following (each, a "Triggering Event"): (a) consolidate or merge with
or into any other Person and the Issuer shall not be the continuing or
surviving corporation of such consolidation or merger, or (b) permit any
other Person to consolidate with or merge into the Issuer and the Issuer
shall be the continuing or surviving Person but, in connection with such
consolidation or merger, any Capital Stock of the Issuer shall be changed
into or exchanged for Securities of any other Person or cash or any other
property, or (c) transfer all or substantially all of its properties or
assets to any other Person, or (d) effect a capital reorganization or
reclassification of its Capital Stock, then, and in the case of each such
Triggering Event, proper provision shall be made to the Warrant Price and
the Warrant Share Number so that, upon the basis and the terms and in the
manner provided in this Warrant, the Holder of this Warrant shall be
entitled, upon the exercise hereof at any time after the consummation of
such Triggering Event (to the extent this Warrant is not exercised prior
to such Triggering Event), to receive at the Warrant Price (as adjusted to
take into account the consummation of such Triggering Event), in lieu of
the Common Stock issuable upon such exercise of this Warrant prior to such
Triggering Event, the Securities, cash and property to which such Holder
would have been entitled upon the consummation of such Triggering Event if
such Holder had exercised the rights represented by this Warrant
immediately prior thereto (including the right, if any, of a shareholder
to elect the type of consideration it will receive in connection with the
Triggering Event), subject to adjustments (subsequent to such corporate
action) as nearly equivalent as possible to the adjustments provided for
elsewhere in this Section 4. Immediately upon the occurrence of a
Triggering Event, the Issuer shall notify the Holder in writing of such
Triggering Event and provide the calculations in determining the number of
-8-
shares of Warrant Stock, if any, issuable upon exercise of the new warrant
and the adjusted Warrant Price. Upon the Holder's request, the continuing
or surviving corporation as a result of such Triggering Event shall issue
to the Holder a new warrant of like tenor, if any, evidencing the right to
purchase the adjusted number of shares of Warrant Stock and the adjusted
Warrant Price pursuant to the terms and provisions of this Section
4(a)(i). Notwithstanding the foregoing to the contrary, this Section
4(a)(i) shall only apply if the surviving entity pursuant to any such
Triggering Event is a company that has a class of equity securities
registered pursuant to the Securities Exchange Act of 1934, as amended,
and its common stock is listed or quoted on a national securities
exchange, national automated quotation system or the OTC Bulletin Board.
(ii) In the event that the Holder has elected not to exercise this
Warrant prior to the consummation of a Triggering Event, so long as the
surviving entity pursuant to any Triggering Event is a company that has a
class of equity securities registered pursuant to the Securities Exchange
Act of 1934, as amended, and its common stock is listed or quoted on a
national securities exchange, national automated quotation system or the
OTC Bulletin Board, the surviving entity and/or each Person (other than
the Issuer) which may be required to deliver any Securities, cash or
property upon the exercise of this Warrant as provided herein shall
assume, by written instrument delivered to, and reasonably satisfactory
to, the Holder of this Warrant, (A) the obligations of the Issuer under
this Warrant (and if the Issuer shall survive the consummation of such
Triggering Event, such assumption shall be in addition to, and shall not
release the Issuer from, any continuing obligations of the Issuer under
this Warrant) and (B) the obligation to deliver to the Holder such
Securities, cash or property as, in accordance with the foregoing
provisions of this subsection (a), the Holder shall be entitled to
receive; and the surviving entity and/or each such Person shall have
similarly delivered to the Holder an opinion of counsel for the surviving
entity and/or each such Person, which counsel shall be reasonably
satisfactory to such Holder, or in the alternative, a written
acknowledgement executed by the President or Chief Financial Officer of
the Issuer, stating that this Warrant shall thereafter continue in full
force and effect and the terms hereof (including, without limitation, all
of the provisions of this subsection (a)) shall be applicable to the
Securities, cash or property which the surviving entity and/or each such
Person may be required to deliver upon any exercise of this Warrant or the
exercise of any rights pursuant hereto.
(b) Stock Dividends, Subdivisions and Combinations. If at any time the
Issuer shall:
(i) make or issue or set a record date for the holders of the Common
Stock for the purpose of entitling them to receive a dividend payable in,
or other distribution of, shares of Common Stock,
(ii) subdivide its outstanding shares of Common Stock into a larger
number of shares of Common Stock, or
-9-
(iii) combine its outstanding shares of Common Stock into a smaller
number of shares of Common Stock,
then (1) the Warrant Share Number immediately after the occurrence of any such
event shall be adjusted to equal the number of shares of Common Stock which a
record holder of the same number of shares of Common Stock for which this
Warrant is exercisable immediately prior to the occurrence of such event would
own or be entitled to receive after the happening of such event, and (2) the
Warrant Price then in effect shall be adjusted to equal (A) the Warrant Price
then in effect multiplied by (B) the Warrant Share Number immediately prior to
the adjustment divided by (B) the Warrant Share Number immediately after such
adjustment.
(c) Certain Other Distributions. If at any time the Issuer shall make or
issue or set a record date for the holders of the Common Stock for the purpose
of entitling them to receive any dividend or other distribution of:
(i) cash (other than a cash dividend payable out of earnings or
earned surplus legally available for the payment of dividends under the
laws of the jurisdiction of incorporation of the Issuer),
(ii) any evidences of its indebtedness, any shares of stock of any
class or any other securities or property of any nature whatsoever (other
than cash, Common Stock Equivalents or Additional Shares of Common Stock),
or
(iii) any warrants or other rights to subscribe for or purchase any
evidences of its indebtedness, any shares of stock of any class or any
other securities or property of any nature whatsoever (other than cash,
Common Stock Equivalents or Additional Shares of Common Stock),
then (1) the number of shares of Common Stock for which this Warrant is
exercisable shall be adjusted to equal the product of the number of shares of
Common Stock for which this Warrant is exercisable immediately prior to such
adjustment multiplied by a fraction (A) the numerator of which shall be the Per
Share Market Value of Common Stock at the date of taking such record and (B) the
denominator of which shall be such Per Share Market Value minus the amount
allocable to one share of Common Stock of any such cash so distributable and of
the fair value (as determined in good faith by the Board and supported by an
opinion from an investment banking firm mutually agreed upon by the Issuer and
the Holder) of any and all such evidences of indebtedness, shares of stock,
other securities or property or warrants or other subscription or purchase
rights so distributable, and (2) the Warrant Price then in effect shall be
adjusted to equal (A) the Warrant Price then in effect multiplied by the number
of shares of Common Stock for which this Warrant is exercisable immediately
prior to the adjustment divided by (B) the number of shares of Common Stock for
which this Warrant is exercisable immediately after such adjustment. A
reclassification of the Common Stock (other than a change in par value, or from
par value to no par value or from no par value to par value) into shares of
Common Stock and shares of any other class of stock shall be deemed a
distribution by the Issuer to the holders of its Common Stock of such shares of
such other class of stock within the meaning of this Section 4(c) and, if the
-10-
outstanding shares of Common Stock shall be changed into a larger or smaller
number of shares of Common Stock as a part of such reclassification, such change
shall be deemed a subdivision or combination, as the case may be, of the
outstanding shares of Common Stock within the meaning of Section 4(b).
(d) Issuance of Additional Shares of Common Stock.
(i) In the event the Issuer shall at any time following the Original
Issue Date issue any Additional Shares of Common Stock (otherwise than as
provided in the foregoing subsections (a) through (c) of this Section 4),
at a price per share less than the Warrant Price then in effect or without
consideration, then the Warrant Price upon each such issuance shall be
adjusted to that price determined by multiplying the Warrant Price then in
effect by a fraction:
(A) the numerator of which shall be equal to the sum of (x)
the number of shares of Outstanding Common Stock immediately prior
to the issuance of such Additional Shares of Common Stock plus (y)
the number of shares of Common Stock (rounded to the nearest whole
share) which the aggregate consideration received by the Issuer for
such Additional Shares of Common Stock would purchase at a price per
share equal to the Warrant Price then in effect, and
(B) the denominator of which shall be equal to the number of
shares of Outstanding Common Stock immediately after the issuance of
such Additional Shares of Common Stock.
(ii) No adjustment of the Warrant Share Number shall be made under
paragraph (i) of Section 4(d) upon the issuance of any Additional Shares
of Common Stock which are issued pursuant to the exercise of any Common
Stock Equivalents, if any such adjustment shall previously have been made
upon the issuance of such Common Stock Equivalents (or upon the issuance
of any warrant or other rights therefor) pursuant to Section 4(e).
(e) Issuance of Common Stock Equivalents. If at any time the Issuer shall
take a record of the holders of its Common Stock for the purpose of entitling
them to receive a distribution of, or shall in any manner (whether directly or
by assumption in a merger in which the Issuer is the surviving corporation)
issue or sell, any Common Stock Equivalents, whether or not the rights to
exchange or convert thereunder are immediately exercisable, and the price per
share for which Additional Shares of Common Stock are issuable upon conversion
or exchange thereof shall be less than the Warrant Price in effect immediately
prior to the time of such issue or sale, or if, after any such issuance of
Common Stock Equivalents, the price per share for which Additional Shares of
Common Stock may be issued thereunder is amended or adjusted, and such price as
so amended shall be less than the Warrant Price in effect at the time of such
amendment or adjustment, then the Warrant Price then in effect shall be adjusted
as provided in Section 4(d). No further adjustments of the Warrant Share Number
and the Warrant Price then in effect shall be made upon the actual issue of such
Common Stock upon conversion or exchange of such Common Stock Equivalents.
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(f) Superseding Adjustment. If, at any time after any adjustment of the
Warrant Share Number and the Warrant Price then in effect shall have been made
pursuant to Section 4(e) as the result of any issuance of Common Stock
Equivalents, and (i) such Common Stock Equivalents, or the right of conversion
or exchange associated with such Common Stock Equivalents, shall expire, and all
or a portion of such or the right of conversion or exchange with respect to all
or a portion of such Common Stock Equivalents, as the case may be, shall not
have been exercised, or (ii) the consideration per share for which shares of
Common Stock are issuable pursuant to such Common Stock Equivalents shall be
increased, then such previous adjustment shall be rescinded and annulled and the
Additional Shares of Common Stock which were deemed to have been issued by
virtue of the computation made in connection with such prior adjustment so
rescinded and annulled shall no longer be deemed to have been issued by virtue
of such computation. Upon the occurrence of an event set forth in this Section
4(f), there shall be a recomputation made of the effect of such Common Stock
Equivalents on the basis of: (i) treating the number of Additional Shares of
Common Stock theretofore actually issued or issuable pursuant to the previous
exercise of Common Stock Equivalents or any such right of conversion or
exchange, as having been issued on the date or dates of any such exercise and
for the consideration actually received and receivable therefor, and (ii)
treating any such Common Stock Equivalents which then remain outstanding as
having been granted or issued immediately after the time of such increase of the
consideration per share for which Additional Shares of Common Stock are issuable
under such Common Stock Equivalents; whereupon a new adjustment of the Warrant
Share Number and the Warrant Price then in effect shall be made, which new
adjustment shall supersede the previous adjustment so rescinded and annulled.
(h) Other Provisions applicable to Adjustments under this Section. The
following provisions shall be applicable to the making of adjustments of the
Warrant Share Number and the Warrant Price then in effect provided for in this
Section 4:
(i) Computation of Consideration. To the extent that any Additional
Shares of Common Stock or any Common Stock Equivalents (or any warrants or
other rights therefor) shall be issued for cash consideration, the
consideration received by the Issuer therefor shall be the amount of the
cash received by the Issuer therefor, or, if such Additional Shares of
Common Stock or Common Stock Equivalents are offered by the Issuer for
subscription, the subscription price, or, if such Additional Shares of
Common Stock or Common Stock Equivalents are sold to underwriters or
dealers for public offering without a subscription offering, the initial
public offering price (in any such case subtracting any amounts paid or
receivable for accrued interest or accrued dividends and without taking
into account any compensation, discounts or expenses paid or incurred by
the Issuer for and in the underwriting of, or otherwise in connection
with, the issuance thereof). In connection with any merger or
consolidation in which the Issuer is the surviving corporation (other than
any consolidation or merger in which the previously outstanding shares of
Common Stock of the Issuer shall be changed to or exchanged for the stock
or other securities of another corporation), the amount of consideration
therefore shall be, deemed to be the fair value, as determined reasonably
and in good faith by the Board, of such portion of the assets and business
of the nonsurviving corporation as the Board may determine to be
attributable to such shares of Common Stock or Common Stock Equivalents,
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as the case may be. The consideration for any Additional Shares of Common
Stock issuable pursuant to any warrants or other rights to subscribe for
or purchase the same shall be the consideration received by the Issuer for
issuing such warrants or other rights plus the additional consideration
payable to the Issuer upon exercise of such warrants or other rights. The
consideration for any Additional Shares of Common Stock issuable pursuant
to the terms of any Common Stock Equivalents shall be the consideration
received by the Issuer for issuing warrants or other rights to subscribe
for or purchase such Common Stock Equivalents, plus the consideration paid
or payable to the Issuer in respect of the subscription for or purchase of
such Common Stock Equivalents, plus the additional consideration, if any,
payable to the Issuer upon the exercise of the right of conversion or
exchange associated with such Common Stock Equivalents. In the event of
any consolidation or merger of the Issuer in which the Issuer is not the
surviving corporation or in which the previously outstanding shares of
Common Stock of the Issuer shall be changed into or exchanged for the
stock or other securities of another corporation, or in the event of any
sale of all or substantially all of the assets of the Issuer for stock or
other securities of any corporation, the Issuer shall be deemed to have
issued a number of shares of its Common Stock for stock or securities or
other property of the other corporation computed on the basis of the
actual exchange ratio on which the transaction was predicated, and for a
consideration equal to the fair market value on the date of such
transaction of all such stock or securities or other property of the other
corporation. In the event any consideration received by the Issuer for any
securities consists of property other than cash, the fair market value
thereof at the time of issuance or as otherwise applicable shall be as
determined in good faith by the Board. In the event Common Stock is issued
with other shares or securities or other assets of the Issuer for
consideration which covers both, the consideration computed as provided in
this Section 4(h)(i) shall be allocated among such securities and assets
as determined in good faith by the Board.
(ii) When Adjustments to Be Made. The adjustments required by this
Section 4 shall be made whenever and as often as any specified event
requiring an adjustment shall occur, except that any adjustment of the
Warrant Share Number that would otherwise be required may be postponed
(except in the case of a subdivision or combination of shares of the
Common Stock, as provided for in Section 4(b)) up to, but not beyond the
date of exercise if such adjustment either by itself or with other
adjustments not previously made adds or subtracts less than one percent
(1%) of the Warrant Share Number immediately prior to the making of such
adjustment. Any adjustment representing a change of less than such minimum
amount (except as aforesaid) which is postponed shall be carried forward
and made as soon as such adjustment, together with other adjustments
required by this Section 4 and not previously made, would result in a
minimum adjustment or on the date of exercise. For the purpose of any
adjustment, any specified event shall be deemed to have occurred at the
close of business on the date of its occurrence.
(iii) Fractional Interests. In computing adjustments under this
Section 4, fractional interests in Common Stock shall be taken into
account to the nearest one one-hundredth (1/100th) of a share.
(iv) When Adjustment Not Required. If the Issuer shall take a record
of the holders of its Common Stock for the purpose of entitling them to
receive a dividend or distribution or subscription or purchase rights and
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shall, thereafter and before the distribution to stockholders thereof,
legally abandon its plan to pay or deliver such dividend, distribution,
subscription or purchase rights, then thereafter no adjustment shall be
required by reason of the taking of such record and any such adjustment
previously made in respect thereof shall be rescinded and annulled.
(i) Form of Warrant after Adjustments. The form of this Warrant need not
be changed because of any adjustments in the Warrant Price or the number and
kind of Securities purchasable upon the exercise of this Warrant.
(j) Escrow of Warrant Stock. If after any property becomes distributable
pursuant to this Section 4 by reason of the taking of any record of the holders
of Common Stock, but prior to the occurrence of the event for which such record
is taken, the Holder exercises this Warrant, any shares of Common Stock
otherwise issuable upon exercise of this Warrant because of an adjustment to the
Warrant Share Number or the Warrant Price resulting from such event shall be
deemed the last shares of Common Stock for which this Warrant is exercised
(notwithstanding any other provision to the contrary herein) and such shares or
other property shall be held in escrow for the Holder by the Issuer to be issued
to the Holder upon and to the extent that the event actually takes place, upon
payment of the then-current Exercise Price. Notwithstanding any other provision
to the contrary herein, if the event for which such record was taken fails to
occur or is rescinded, then such escrowed shares shall be cancelled by the
Issuer and escrowed property returned.
5. Notice of Adjustments. Whenever the Warrant Price or Warrant Share
Number shall be adjusted pursuant to Section 4 hereof (for purposes of this
Section 5, each an "adjustment"), the Issuer shall cause its Chief Financial
Officer to prepare and execute a certificate setting forth, in reasonable detail
and to extent such is not material non-public information, the event requiring
the adjustment, the amount of the adjustment, the method by which such
adjustment was calculated (including a description of the basis on which the
Board made any determination hereunder), and the Warrant Price and Warrant Share
Number after giving effect to such adjustment, and shall cause copies of such
certificate to be delivered to the Holder of this Warrant promptly after each
adjustment. Any dispute between the Issuer and the Holder of this Warrant with
respect to the matters set forth in such certificate may at the option of the
Holder of this Warrant be submitted to a national or regional accounting firm
reasonably acceptable to the Issuer and the Holder. The firm selected by the
Holder as provided in the preceding sentence shall be instructed to deliver a
written opinion as to such matters to the Issuer and the Holder within thirty
(30) days after submission to it of such dispute. Such opinion shall be final
and binding on the parties hereto. The costs and expenses of the initial
accounting firm shall be paid equally by the Issuer and the Holder.
6. Fractional Shares. No fractional shares of Warrant Stock will be issued
in connection with any exercise hereof, but in lieu of such fractional shares,
the Issuer shall round the number of shares to be issued upon exercise up to the
nearest whole number of shares.
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7. Ownership Cap and Exercise Restriction. Notwithstanding anything to the
contrary set forth in this Warrant, at no time may the Holder exercise this
Warrant if the number of shares of Common Stock to be issued pursuant to such
exercise would, when aggregated with all other shares of Common Stock owned by
the Holder at such time, result in such Holder beneficially owning (as
determined in accordance with Section 13(d) of the Exchange Act and the rules
thereunder) in excess of 9.9% of the then issued and outstanding shares of
Common Stock; provided, however, that upon the Holder providing the Issuer with
sixty-one (61) days notice (pursuant to Section 13 hereof) (the "Waiver Notice")
that such Holder would like to waive this Section 7 with regard to any or all
shares of Warrant Stock issuable hereunder, this Section 7 will be of no force
or effect with regard to all or a portion of the Warrant referenced in the
Waiver Notice; provided, further, that this provision shall be of no further
force or effect during the sixty-one (61) days immediately preceding the
expiration of the term of this Warrant.
8. Registration Rights. The Holder of this Warrant is entitled to the
benefit of certain registration rights with respect to the shares of Warrant
Stock issuable hereunder pursuant to that certain Registration Rights Agreement,
of even date herewith, by and among the Issuer and Persons listed on Schedule I
thereto (the "Registration Rights Agreement") and the registration rights with
respect to the shares of Warrant Stock issuable hereunder by any subsequent
Holder may only be assigned in accordance with the terms and provisions of the
Registrations Rights Agreement.
9. Definitions. For the purposes of this Warrant, the following terms have
the following meanings:
"Additional Shares of Common Stock" means all shares of Common Stock
issued by the Issuer after the Original Issue Date, and all shares of
Other Common, if any, issued by the Issuer after the Original Issue Date,
except: (i) securities issued (other than for cash) in connection with a
merger, acquisition, or consolidation, (ii) securities issued pursuant to
the conversion or exercise of convertible or exercisable securities issued
or outstanding on or prior to the date of the Purchase Agreement or issued
pursuant to the Purchase Agreement (so long as the conversion or exercise
price in such securities are not amended to lower such price and/or
adversely affect the Holders), (iii) the Warrant Stock, (iv) securities
issued in connection with bona fide strategic license agreements or other
partnering arrangements so long as such issuances are not for the purpose
of raising capital, (v) Common Stock issued or the issuance or grants of
options to purchase Common Stock pursuant to the Issuer's stock option
plans and employee stock purchase plans outstanding as they exist on the
date of the Purchase Agreement, (vi) Common Stock issued as payment of
dividends on the Series A Convertible Preferred Stock issued pursuant to
the Purchase Agreement, and (vii) any warrants issued to the placement
agent and its designees for the transactions contemplated by the Purchase
Agreement.
"Articles of Incorporation" means the Articles of Incorporation of
the Issuer as in effect on the Original Issue Date, and as hereafter from
time to time amended, modified, supplemented or restated in accordance
with the terms hereof and thereof and pursuant to applicable law.
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"Board" shall mean the Board of Directors of the Issuer.
"Capital Stock" means and includes (i) any and all shares,
interests, participations or other equivalents of or interests in (however
designated) corporate stock, including, without limitation, shares of
preferred or preference stock, (ii) all partnership interests (whether
general or limited) in any Person which is a partnership, (iii) all
membership interests or limited liability company interests in any limited
liability company, and (iv) all equity or ownership interests in any
Person of any other type.
"Common Stock" means the Common Stock, $0.001 par value per share,
of the Issuer and any other Capital Stock into which such stock may
hereafter be changed.
"Common Stock Equivalent" means any Convertible Security, warrant,
option or other right to subscribe for or purchase any Additional Shares
of Common Stock or any Convertible Security.
"Convertible Securities" means evidences of shares of Capital Stock
or other Securities which are or may be at any time convertible into or
exchangeable for Additional Shares of Common Stock. The term "Convertible
Security" means one of the Convertible Securities.
"Forced Conversion Price" initially means $1.80, as such price may
be adjusted from time to time as shall result from the adjustments
specified in this Warrant, including Section 4 hereto.
"Governmental Authority" means any governmental, regulatory or
self-regulatory entity, department, body, official, authority, commission,
board, agency or instrumentality, whether federal, state or local, and
whether domestic or foreign.
"Holders" mean the Persons who shall from time to time own any
Warrant. The term "Holder" means one of the Holders.
"Independent Appraiser" means a nationally recognized or major
regional investment banking firm or firm of independent certified public
accountants of recognized standing (which may be the firm that regularly
examines the financial statements of the Issuer) that is regularly engaged
in the business of appraising the Capital Stock or assets of corporations
or other entities as going concerns, and which is not affiliated with
either the Issuer or the Holders.
"Issuer" means BioForce Nanosciences Holdings, Inc., a Nevada
corporation, and its successors.
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"Majority Holders" means at any time the Holders of Warrants
exercisable for a majority of the shares of Warrant Stock issuable under
the Warrants at the time outstanding.
"Original Issue Date" means August 31, 2007.
"OTC Bulletin Board" means the over-the-counter electronic bulletin
board.
"Other Common" means any other Capital Stock of the Issuer of any
class which shall be authorized at any time after the date of this Warrant
(other than Common Stock) and which shall have the right to participate in
the distribution of earnings and assets of the Issuer without limitation
as to amount.
"Outstanding Common Stock" means, at any given time, the aggregate
amount of outstanding shares of Common Stock, assuming full exercise,
conversion or exchange (as applicable) of all options, warrants and other
Securities which are convertible into or exercisable or exchangeable for,
and any right to subscribe for, shares of Common Stock that are
outstanding at such time.
"Person" means an individual, corporation, limited liability
company, partnership, joint stock company, trust, unincorporated
organization, joint venture, Governmental Authority or other entity of
whatever nature.
"Per Share Market Value" means on any particular date (a) the last
closing bid price per share of the Common Stock on such date on the OTC
Bulletin Board or another registered national stock exchange on which the
Common Stock is then listed, or if there is no such price on such date,
then the closing bid price on such exchange or quotation system on the
date nearest preceding such date, or (b) if the Common Stock is not listed
then on the OTC Bulletin Board or any registered national stock exchange,
the last closing bid price for a share of Common Stock in the
over-the-counter market, as reported by the National Quotation Bureau
Incorporated (or similar organization or agency succeeding to its
functions of reporting prices) at the close of business on such date, or
(c) if the Common Stock is not then reported by the OTC Bulletin Board or
the National Quotation Bureau Incorporated (or similar organization or
agency succeeding to its functions of reporting prices), then the average
of the "Pink Sheet" quotes for the five (5) Trading Days preceding such
date of determination, or (d) if the Common Stock is not then publicly
traded the fair market value of a share of Common Stock as determined by
an Independent Appraiser selected in good faith by the Majority Holders,
at the Holders sole expense; provided, however, that the Issuer, after
receipt of the determination by such Independent Appraiser, shall have the
right to select an additional Independent Appraiser (at its sole expense),
in which case, the fair market value shall be equal to the average of the
determinations by each such Independent Appraiser; and provided, further
that all determinations of the Per Share Market Value shall be
appropriately adjusted for any stock dividends, stock splits or other
similar transactions during such period. The determination of fair market
value by an Independent Appraiser shall be based upon the fair market
-17-
value of the Issuer determined on a going concern basis as between a
willing buyer and a willing seller and taking into account all relevant
factors determinative of value, and shall be final and binding on all
parties. In determining the fair market value of any shares of Common
Stock, no consideration shall be given to any restrictions on transfer of
the Common Stock imposed by agreement or by federal or state securities
laws, or to the existence or absence of, or any limitations on, voting
rights.
"Purchase Agreement" means the Series A Convertible Preferred Stock
and Warrant Purchase Agreement dated as of August 31, 2007, among the
Issuer and the Purchasers.
"Purchasers" means the purchasers of the Series A Convertible
Preferred Stock and the Warrants issued by the Issuer pursuant to the
Purchase Agreement.
"Securities" means any debt or equity securities of the Issuer,
whether now or hereafter authorized, any instrument convertible into or
exchangeable for Securities or a Security, and any option, warrant or
other right to purchase or acquire any Security. "Security" means one of
the Securities.
"Securities Act" means the Securities Act of 1933, as amended, or
any similar federal statute then in effect.
"Subsidiary" means any corporation at least 50% of whose outstanding
Voting Stock shall at the time be owned directly or indirectly by the
Issuer or by one or more of its Subsidiaries, or by the Issuer and one or
more of its Subsidiaries.
"Term" has the meaning specified in Section 1 hereof.
"Trading Day" means (a) a day on which the Common Stock is traded on
the OTC Bulletin Board, or (b) if the Common Stock is not traded on the
OTC Bulletin Board, a day on which the Common Stock is quoted in the
over-the-counter market as reported by the National Quotation Bureau
Incorporated (or any similar organization or agency succeeding its
functions of reporting prices); provided, however, that in the event that
the Common Stock is not listed or quoted as set forth in (a) or (b)
hereof, then Trading Day shall mean any day except Saturday, Sunday and
any day which shall be a legal holiday or a day on which banking
institutions in the State of Delaware are authorized or required by law or
other government action to close.
"Voting Stock" means, as applied to the Capital Stock of any
corporation, Capital Stock of any class or classes (however designated)
having ordinary voting power for the election of a majority of the members
of the board of directors (or other governing body) of such corporation,
other than Capital Stock having such power only by reason of the happening
of a contingency.
-18-
"Warrants" means the Warrants issued and sold pursuant to the
Purchase Agreement, including, without limitation, this Warrant, and any
other warrants of like tenor issued in substitution or exchange for any
thereof pursuant to the provisions of Section 2(b), 2(c), 2(d) or 2(e)
hereof or of any of such other Warrants.
"Warrant Price" initially means $0.90, as such price may be adjusted
from time to time as shall result from the adjustments specified in this
Warrant, including Section 4 hereto.
"Warrant Stock" means Common Stock issuable upon exercise of any
Warrant or Warrants or otherwise issuable pursuant to any Warrant or
Warrants.
10. Other Notices. In case at any time:
(A) the Issuer shall make any distributions to the
holders of Common Stock; or
(B) the Issuer shall authorize the granting to all
holders of its Common Stock of rights to subscribe
for or purchase any shares of Capital Stock of any
class or other rights; or
(C) there shall be any reclassification of the Capital
Stock of the Issuer; or
(D) there shall be any capital reorganization by the
Issuer; or
(E) there shall be any (i) consolidation or merger
involving the Issuer or (ii) sale, transfer or
other disposition of all or substantially all of
the Issuer's property, assets or business (except
a merger or other reorganization in which the
Issuer shall be the surviving corporation and its
shares of Capital Stock shall continue to be
outstanding and unchanged and except a
consolidation, merger, sale, transfer or other
disposition involving a wholly-owned Subsidiary);
or
(F) there shall be a voluntary or involuntary
dissolution, liquidation or winding-up of the
Issuer or any partial liquidation of the Issuer or
distribution to holders of Common Stock;
then, in each of such cases, the Issuer shall give written notice to the Holder
of the date on which (i) the books of the Issuer shall close or a record shall
be taken for such dividend, distribution or subscription rights or (ii) such
reorganization, reclassification, consolidation, merger, disposition,
dissolution, liquidation or winding-up, as the case may be, shall take place.
Such notice also shall specify the date as of which the holders of Common Stock
of record shall participate in such dividend, distribution or subscription
rights, or shall be entitled to exchange their certificates for Common Stock for
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securities or other property deliverable upon such reorganization,
reclassification, consolidation, merger, disposition, dissolution, liquidation
or winding-up, as the case may be. Such notice shall be given at least twenty
(20) days prior to the action in question and not less than ten (10) days prior
to the record date or the date on which the Issuer's transfer books are closed
in respect thereto. This Warrant entitles the Holder to receive copies of all
financial and other information distributed or required to be distributed to the
holders of the Common Stock.
11. Amendment and Waiver. Any term, covenant, agreement or condition in
this Warrant may be amended, or compliance therewith may be waived (either
generally or in a particular instance and either retroactively or
prospectively), by a written instrument or written instruments executed by the
Issuer and the Majority Holders; provided, however, that no such amendment or
waiver shall reduce the Warrant Share Number, increase the Warrant Price,
shorten the period during which this Warrant may be exercised or modify any
provision of this Section 11 without the consent of the Holder of this Warrant.
No consideration shall be offered or paid to any person to amend or consent to a
waiver or modification of any provision of this Warrant unless the same
consideration is also offered to all Holders.
12. Governing Law; Jurisdiction. This Warrant shall be governed by and
construed in accordance with the internal laws of the State of Delaware, without
giving effect to any of the conflicts of law principles which would result in
the application of the substantive law of another jurisdiction. This Warrant
shall not be interpreted or construed with any presumption against the party
causing this Warrant to be drafted. The Issuer and the Holder agree that venue
for any dispute arising under this Warrant will lie exclusively in the state or
federal courts located in the State of Delaware, and the parties irrevocably
waive any right to raise forum non conveniens or any other argument that
Delaware is not the proper venue. The Issuer and the Holder irrevocably consent
to personal jurisdiction in the state and federal courts of the State of
Delaware. The Issuer and the Holder consent to process being served in any such
suit, action or proceeding by mailing a copy thereof to such party at the
address in effect for notices to it under this Warrant and agrees that such
service shall constitute good and sufficient service of process and notice
thereof. Nothing in this Section 12 shall affect or limit any right to serve
process in any other manner permitted by law. The Issuer and the Holder hereby
agree that the prevailing party in any suit, action or proceeding arising out of
or relating to this Warrant or the Purchase Agreement, shall be entitled to
reimbursement for reasonable legal fees from the non-prevailing party. The
parties hereby unconditionally and irrevocably waive all rights to a trial by
jury in any suit, action or proceeding arising out of or relating to this
Warrant or the transactions contemplated hereby.
13. Notices. Any notice, demand, request, waiver or other communication
required or permitted to be given hereunder shall be in writing and shall be
effective (a) upon delivery when sent by hand delivery, telecopy or facsimile at
the address or number designated below (if delivered on a business day during
normal business hours where such notice is to be received), or the first
business day following such delivery (if delivered other than on a business day
during normal business hours where such notice is to be received) or (b) on the
second business day following the date of mailing by express courier service,
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fully prepaid, addressed to such address, or upon actual receipt of such
mailing, whichever shall first occur. The addresses for such communications
shall be:
If to the Company: BioForce Nanosciences Holdings, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
with copies (which ▇▇▇▇▇▇▇▇ & English, LLP
shall not constitute Four Gateway Center
notice) to: ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to any Holder: At the address of such Holder set forth on Exhibit A to
the Purchase Agreement or as specified in writing by
such Holder.
Any party hereto may from time to time change its address for notices by
giving written notice of such changed address to the other party hereto.
14. Warrant Agent. The Issuer may, by written notice to the Holder of this
Warrant, appoint an agent having an office in ______, _______ for the purpose of
issuing shares of Warrant Stock on the exercise of this Warrant pursuant to
subsection (b) of Section 2 hereof, exchanging this Warrant pursuant to
subsection (d) of Section 2 hereof or replacing this Warrant pursuant to
subsection (d) of Section 3 hereof, or any of the foregoing, and thereafter any
such issuance, exchange or replacement, as the case may be, shall be made at
such office by such agent.
15. Remedies. Each of the Issuer and the Holder (the "Defaulting Party")
stipulates to the other (the "Harmed Party") that the remedies at law of the
Harmed Party in the event of any default or threatened default by the Defaulting
Party in the performance of or compliance with any of the terms of this Warrant
are not and will not be adequate and that, to the fullest extent permitted by
law, such terms may be specifically enforced by a decree for the specific
performance of any agreement contained herein or by an injunction against a
violation of any of the terms hereof or otherwise.
16. Successors and Assigns. This Warrant and the rights evidenced hereby
shall inure to the benefit of and be binding upon the successors and assigns of
the Issuer, the Holder hereof and (to the extent provided herein) the Holders of
Warrant Stock issued pursuant hereto, and shall be enforceable by any such
Holder or Holder of Warrant Stock.
17. Modification and Severability. If, in any action before any court or
agency legally empowered to enforce any provision contained herein, any
provision hereof is found to be unenforceable, then such provision shall be
deemed modified to the extent necessary to make it enforceable by such court or
agency. If any such provision is not enforceable as set forth in the preceding
sentence, the unenforceability of such provision shall not affect the other
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provisions of this Warrant, but this Warrant shall be construed as if such
unenforceable provision had never been contained herein.
18. Headings. The headings of the Sections of this Warrant are for
convenience of reference only and shall not, for any purpose, be deemed a part
of this Warrant.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the Issuer has executed this Series B Warrant as of
the day and year first above written.
BIOFORCE NANOSCIENCES HOLDINGS, INC.
By:
------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chief Financial Officer
Accepted and Agreed:
--------------------------
Holder:
By:
Title:
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EXERCISE FORM
SERIES B WARRANT
BIOFORCE NANOSCIENCES HOLDINGS, INC.
The undersigned _______________, pursuant to the provisions of the within
Warrant, hereby elects to purchase _____ shares of Common Stock of BioForce
Nanosciences Holdings, Inc. covered by the within Warrant.
Dated: _________________ Signature ___________________________
Address _____________________
_____________________
Number of shares of Common Stock beneficially owned or deemed beneficially owned
by the Holder on the date of Exercise: _________________________
The undersigned is an "accredited investor" as defined in Regulation D under the
Securities Act of 1933, as amended.
The undersigned intends that payment of the Warrant Price shall be made as
(check one):
Cash Exercise_______
Cashless Exercise_______
If the Holder has elected a Cash Exercise, the Holder shall pay the sum of
$________ by certified or official bank check (or via wire transfer) to the
Issuer in accordance with the terms of the Warrant.
[Continued on next page]
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If the Holder has elected a Cashless Exercise, a certificate shall be issued to
the Holder for the number of shares equal to the whole number portion of the
product of the calculation set forth below, which is ___________. The Issuer
shall pay a cash adjustment in respect of the fractional portion of the product
of the calculation set forth below in an amount equal to the product of the
fractional portion of such product and the Per Share Market Value on the date of
exercise, which product is ____________.
X = Y - (A)(Y)
------
B
Where:
The number of shares of Common Stock to be issued to the Holder
__________________("X").
The number of shares of Common Stock purchasable upon exercise of all of the
Warrant or, if only a portion of the Warrant is being exercised, the portion of
the Warrant being exercised ___________________________ ("Y").
The Warrant Price ______________ ("A").
The Per Share Market Value of one share of Common Stock _________________ ("B").
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ASSIGNMENT
FOR VALUE RECEIVED, _________________ hereby sells, assigns and transfers unto
__________________ the within Warrant and all rights evidenced thereby and does
irrevocably constitute and appoint _____________, attorney, to transfer the said
Warrant on the books of the within named corporation.
Dated: _________________ Signature ___________________________
Address _____________________
_____________________
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PARTIAL ASSIGNMENT
FOR VALUE RECEIVED, _________________ hereby sells, assigns and transfers unto
__________________ the right to purchase _________ shares of Warrant Stock
evidenced by the within Warrant together with all rights therein, and does
irrevocably constitute and appoint ___________________, attorney, to transfer
that part of the said Warrant on the books of the within named corporation.
Dated: _________________ Signature ___________________________
Address _____________________
_____________________
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FOR USE BY THE ISSUER ONLY:
This Warrant No. W-___ canceled (or transferred or exchanged) this _____ day of
___________, _____, shares of Common Stock issued therefor in the name of
_______________, Warrant No. W-_____ issued for ____ shares of Common Stock in
the name of _______________.
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