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Exhibit 4.5
PREFERRED STOCK WARRANT
NEITHER THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE OF
THIS WARRANT
HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
NO SALE OR
DISPOSITION MAY BE EFFECTED EXCEPT IN COMPLIANCE WITH RULE 144
UNDER SAID ACT OR
WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN
OPINION OF
COUNSEL FOR THE HOLDER, SATISFACTORY TO THE COMPANY, THAT SUCH
REGISTRATION IS
NOT REQUIRED UNDER THE ACT OR RECEIPT OF A NO-ACTION LETTER FROM
THE SECURITIES
AND EXCHANGE COMMISSION.
WARRANT TO PURCHASE SHARES OF SERIES F PREFERRED STOCK
Dated: May 31, 2005
THIS CERTIFIES THAT, for value received, Oxford Finance
Corporation, ("Holder")
is entitled to subscribe for and purchase that number of shares as
set forth in
paragraph 1 below of the fully paid and non-assessable Series F
Preferred Stock
(the "Shares" or the "Preferred Stock") of Alsius Corporation, a
California
corporation (the "Company"), at the Warrant Price (as hereinafter
defined),
subject to the provisions and upon the terms and conditions
hereinafter set
forth. As used herein, the term "Series F Preferred Stock" shall
mean the
Company's presently authorized Series F Preferred Stock, and any
stock into
which such Series F Preferred Stock may hereafter be exchanged.
1. Warrant Price. The Warrant Price shall initially be the lower of
(i) Three
Dollars ($3.00) per share and (ii) the lowest effective price per
share (on a
common stock equivalent basis and taking into account any
securities issued
together with the preferred stock) at which shares of the Company's
convertible
preferred stock are sold in the next Qualified Financing; provided,
however, if
the Qualified Financing has not closed prior to the exercise of
this Warrant,
then the Warrant Price shall be Three Dollars ($3,00) per share. A
"Qualified
Financing" shall mean the sale of the convertible preferred stock
of the Company
to purchasers which include venture capital investors in an
aggregate gross cash
amount not less than $2,000,000 (excluding any bridge debt actually
converted
into equity.). The number of shares for which this Warrant is
exercisable shall
be the nearest whole number determined by dividing $350,000 by the
Warrant Price
determined pursuant to this paragraph
2. Conditions to Exercise. The purchase right represented by this
Warrant may be
exercised at any time, or from time to time, in whole or in part
during the term
commencing on the date hereof and ending on the earlier of:
(a)
5:00 P.M. Eastern
Standard time on the eighth annual anniversary of
this Warrant Agreement; or
(b)
the earlier
termination of this Warrant pursuant to Section 3(e).
In
the event that, although the Company shall have given notice of
a
transaction pursuant to subparagraph [3(e)] hereof, the transaction
does not
close within 60 days of the day specified by the Company, unless
otherwise
elected by the Holder any exercise of the Warrant subsequent to the
giving of
such notice shall be rescinded and the Warrant shall again be
exercisable until
terminated in accordance with this Paragraph 2.
3. Method of Exercise; Payment; Issuance of Shares; Issuance of New
Warrant.
(a)
Cash Exercise. Subject
to Section 2 hereof, the purchase right
represented by this Warrant may be exercised by the Holder hereof,
in
whole or in part, by the surrender of this Warrant (with a duly
executed Notice of Exercise in the form attached hereto) at the
principal office of the Company (as set forth in Section 18 below)
and
by payment to the Company, by check, of an amount equal to the
then
applicable Warrant Price per share multiplied by the number of
shares
then being purchased. In the event of any exercise of the
rights
represented by this Warrant, certificates for the shares of stock
so
purchased shall be in
the name of, and delivered to, the Holder
hereof, or as such Holder may direct (subject to the terms of
transfer
contained herein and upon payment by such Holder hereof of any
applicable transfer taxes). Such delivery shall be made within
10
business days after exercise of the Warrant and at the
Company's
expense and, unless this Warrant
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PREFERRED STOCK WARRANT
has been fully exercised or expired, a new Warrant having terms
and
conditions substantially identical to this Warrant and
representing
the portion of the Shares, if any, with respect to which this
Warrant
shall not
have been exercised, shall also be issued to the Holder
hereof within 10 business days after exercise of the Warrant.
(b)
Net Issue Exercise. In
lieu of exercising this Warrant pursuant to
Section 3(a), Holder may elect to receive shares equal to the value
of
this Warrant (or of any portion thereof remaining unexercised)
by
surrender of this Warrant at the principal office of the
Company
together with notice of such election, in which event the
Company
shall issue to Holder the number of shares of the Company's Series
___
Preferred Stock computed using the following formula:
Y (A-B)
X = -------
A
Where X = the number of shares of Series F Preferred Stock to
be
issued to Holder.
Y = the number of shares of Series F Preferred Stock purchasable
under
this Warrant (at the date of such calculation).
A = the Fair Market Value of one share of the Company's Series
F
Preferred Stock (at the date of such calculation).
B = Warrant Exercise Price (as adjusted to the date of such
calculation).
(c)
Fair Market Value. For
purposes of this Section 3, Fair Market Value
of one share of the Company's Series F Preferred Stock shall
mean:
(i) If the Common
Stock is traded on NASDAQ or Over-The-Counter or on
an exchange, the per share Fair Market Value for the Series F
Preferred Stock will be the average of the closing bid and
asked
prices of the Common Stock quoted in the Over-The-Counter
Market
Summary or the closing price quoted on any exchange on which
the
Common Stock is listed, whichever is applicable, as published
in
the Western Edition of The Wall Street Journal for the ten (10)
trading days prior to the date of determination of Fair Market
Value multiplied by the number of shares of Common Stock into
which each share of Series F Preferred Stock is then
convertible;
or
(ii) In the event of an exercise in connection with a merger,
acquisition or other consolidation in which the Company is not
the surviving entity, the per share Fair Market Value for the
Series F Preferred Stock shall be the value to be received per
share of Series F Preferred Stock by all Holders of the Series
F
Preferred Stock in such transaction as determined by the Board
of
Directors; or
(iii) In any other instance, the per share Fair Market Value for
the
Series F Preferred Stock shall be as determined in good faith
by
the Company's Board of Directors unless Holder elects to have
such fair market value determined by an appraiser, which
election
must be made by Holder within ten (10) business days of the
date
the Company notifies Holder of the fair market value as
determined by its Board of Directors. In the event of such an
appraisal, the cost thereof shall be borne by the Holder unless
such appraisal results in a fair market value in excess of 115%
of that determined by the Company's Board of Directors, in
which
event the Company shall bear the cost of such appraisal.
In the event of 3(c)(ii) or 3(c)(iii), above, the Company's
Board
of Directors shall prepare a certificate, to be signed by an
authorized Officer of the Company, setting forth in reasonable
detail
the basis for and method of determination of the per share Fair
Market
Value of the Series Preferred Stock. The Board will also certify
to
the Holder that this per share Fair Market Value
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PREFERRED STOCK WARRANT
will be applicable to all holders of the Company's Series F
Preferred
Stock. Such certification must be made to Holder at least fifteen
(15)
business days prior to the proposed effective date of the
merger,
consolidation, sale, or other triggering event as defined in
3(c)(ii)
and 3(c)(iii).
(d)
Automatic Exercise. To
the extent this Warrant is not previously
exercised, it shall be automatically exercised in accordance
with
Sections 3(b) and 3(c) hereof (even if not surrendered)
immediately
before its expiration.
(e)
Treatment of Warrant
Upon Acquisition of Company.
(i) Upon the written
request of the Company, Holder agrees that, in
the event of an Acquisition (as defined below) in which the
sole
consideration is cash, either (a) Holder shall exercise its
conversion or purchase right under this Warrant and such
exercise
will be deemed effective immediately prior to the consummation
of
such Acquisition or (b) if Holder elects not to exercise the
Warrant, this Warrant will expire upon the consummation of such
Acquisition. The Company shall provide the Holder with written
notice of its request relating to the foregoing (together with
such reasonable information as the Holder may request in
connection with such contemplated Acquisition giving rise to
such
notice), which is to be delivered to Holder not less than ten
(10) days prior to the closing of the proposed Acquisition.
(ii) Upon written request of the Company, Holder agrees that, in
the
event of a stock for stock Acquisition of the Company by a
publicly traded acquirer if, on the record date for the
Acquisition, the fair market value of the Shares (or other
securities issuable upon exercise of this Warrant) is equal to
or
greater than four [4] times the Warrant Price, Company may
require the Warrant to be deemed automatically exercised and
the
Holder shall participate in the Acquisition as a holder of the
Shares (or
other securities issuable upon exercise of the
Warrant) on the same terms as other holders of the same class
of
securities of the Company.
(iii) Upon the closing of any Acquisition other than those
particularly described in subsections (i) or (ii) above, the
successor entity shall assume the obligations of the Warrant,
and
the Warrant shall be exercisable for the same securities, cash,
and property as would be payable for the Shares issuable upon
exercise of the unexercised portion of this Warrant as if such
Shares were outstanding on the record date for the Acquisition
and subsequent closing. The Warrant Price and/or number of
Shares
shall be adjusted accordingly.
(iv) For the purpose of this Warrant, "Acquisition" means any
sale,
license, or other disposition of all or substantially all of
the
assets of the Company, or any reorganization, consolidation, or
merger of the Company where the holders of the Company's
securities before the transaction beneficially own less than
50%
of the outstanding voting securities of the surviving entity
after the transaction, other than in connection with an initial
public offering.
4. Representations and Warranties of Holder and Restrictions on
Transfer Imposed
by the Securities Act of 1933.
(a)
Representations and
Warranties by Holder. The Holder represents and
warrants to the Company with respect to this purchase as
follows:
(i) The Holder has
substantial experience in evaluating and investing
in private placement transactions of securities of companies
similar to the Company so that the Holder is capable of
evaluating the merits and risks of its investment in the
Company
and has the capacity to protect its interests.
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PREFERRED STOCK WARRANT
(ii) The Holder is acquiring the Warrant and the Shares of Series
F
Preferred Stock issuable upon exercise of the Warrant and
Common
Stock issuable upon conversion thereof (collectively the
"Securities") for investment for its own account and not with a
view to, or for resale in connection with, any distribution
thereof. The Holder understands that the Securities have not
been
registered under the Securities Act of 1933, as amended (the
"Act") by reason of a specific exemption from the registration
provisions of the Act, which depends upon, a
