Exhibit 10.23
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THE SECURITIES REPRESENTED HEREBY
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED
WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR AN
OPINION OF COUNSEL, SATISFACTORY TO THE CORPORATION AND ITS
COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.
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BioDrain Medical, Inc.
MEDICAL ADVISORY BOARD WARRANT
AGREEMENT
This
Advisory Board Warrant Agreement is made and entered as of the 31
day of August, 2005 (the Agreement Date”) by and between
BioDrain Medical, Inc., a Minnesota corporation
(“Company”) and Medical Advisory Board member Mary
Wolls Gorman (the “ Warrantee ”) as
consideration for Board membership..
1. Warrant Grant.
The Company hereby grants to the
Warrantee a warrant (the “Warrant”) to purchase 5,000
shares (“Warrant Shares”, with each being a
“Warrant Share”) of its $0.01 par value common stock
(“Share”), under the terms and conditions set forth
below.
2. Nonstatutory
Option. The Warrant is
granted to purchase up to the number of shares of authorized but
unissued common stock of the Company specified in Section 1 (the
“Shares”). The Warrant will expire, end all rights to
exercise it will terminate on the earliest of (a) the date provided
below in Sections 8 and 9, and (b) the Expiration Date.
3. Exercise Price.
The exercise price of each Warrant
Share of the Company as of any exercise date is $1.00 per
Share.
4. Period of
Exercise. The Warrant
will expire at 5:00 p.m. on the fifth anniversary of the Agreement
Date (“the Expiration Date”).
5. Vesting of Options.
Warrantee will have the right to exercise the Warrant in accordance
with the following schedule:
(a)
The Shares subject to Warrant will vest in 90 days from the
Agreement Date.
6. Transferability.
The Warrant is not transferable
except by will or the laws of descent and distribution and may be
exercised during the lifetime of the Warrantee only by the
Warrantee, and if exercised following the Warrantee’s death,
by the Warrantee’s legal representative upon presenting
evidence of authority to act on behalf of the Warrantee’s
estate acceptable to the Company.
7. Change in
Control. If the Company
enters into a binding agreement during the time that Warrantee is a
Medical Advisory Board member of the Company that results in a
change in control (as defined in the following sentence), then 100%
of the Shares will vest. For purposes of this Warrant Agreement,
“change in control” means that:
(a)
any individual, partnership, firm, corporation, association, trust,
unincorporated organization or other entity or person, or any
syndicate or group deemed to be a person under Section 14(d)(2) of
the Securities Exchange Act of 1994, as amended (the
“Exchange Act”), is or becomes the “beneficial
owner” (as defined in Rule 13d-3 of the General Rules and
Regulations under the Exchange Act), directly or indirectly, of
securities of the Corporation representing fifty percent (50%) or
more of the combined voting power of the Company’s then
outstanding securities entitled to vote in the election of
directors of the Company; or
1
(b)
there occurs a reorganization, merger, consolidation or other
corporate transaction involving the company
(“Transaction”), in each case, with respect to which
the stockholders of the company immediately prior to such
Transaction do not, immediately after the Transaction, own more
than fifty percent (50%) of the combined voting power of the
company or other corporation resulting from such Transaction;
or
(c)
all or substantially all of the assets of the Company are sold,
liquidated or distributed.
8. Warrant Lapse.
The Warrant will lapse and becomes
unexercisable in full on the earliest of the following
events:
(a)
three (3) months following the Warrantee’s death, as provided
below in Section 9;
(b)
the date otherwise provided below in Section 9, unless the Board of
Directors otherwise extends such period before the applicable
expiration date.
9. Medical Advisory Board
Resignation. If Warrantee
ceases to be a Medical Advisory Board member for any reason other
than that described in this Section 9, Warrantee will have the
right, subject to the other provisions of this Agreement, to
exercise the Warrant for up to ninety (90) days following the date
of termination, but only to the extent that on the date of
termination the Warrantee’s right to exercise such Warrant
had vested, and at the end of such period the Warrant will expire,
and all rights to exercise it will terminate.
(a)
If warrantee dies while a Medical Advisory Board member, or after
ceasing to be a Medical Advisory Board member but during the period
while be or she could have exercised an Warrant under the proceding
and Sections, the Warrant granted to the Warrantee may be
exercised, to the extent it has vested at the time of death at any
time Within ninety (90) days after the Warrantee’s death, by
the executors or administrations of his or her estate or by any
person or persons who acquire the warrant by will or the laws of
descent and distribution, but not beyond the otherwise applicable
tern of the Warrant.
10. Adjustment in
Capitalization. If there
is any change in the outstanding common stock of the company by
reason of a stock dividend or split, recapitalization,
reclassification, or other similar capital change, the agreegate
member of Warrant Sha
