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Exhibit 4.12
THESE SECURITIES HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND MAY NOT BE SOLD, PLEDGED OR
OTHERWISE TRANSFERRED UNLESS (A)
COVERED BY AN EFFECTIVE REGISTRATION
STATEMENT UNDER SUCH ACT, (B) THE COMPANY
HAS BEEN FURNISHED WITH AN OPINION OF
COUNSEL REASONABLY ACCEPTABLE TO THE
COMPANY TO THE EFFECT THAT NO REGISTRATION
IS REQUIRED FOR SUCH TRANSFER OR (C)
SUCH TRANSFER IS MADE IN ACCORDANCE WITH
THE PROVISIONS OF REGULATION S UNDER
THE ACT. HEDGING TRANSACTIONS INVOLVING
THESE SHARES MAY NOT BE CONDUCTED UNLESS
IN COMPLIANCE WITH THE ACT.
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Warrant No. W-B __________
XXXXXX Shares
Form of
WARRANT
To Purchase Shares of Series B Convertible Preferred Stock
of
ALTUS BIOLOGICS INC.
Dated September __, 2001
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WHEREAS, Altus
Biologics Inc., a Delaware corporation (the "Company"),
intends to provide the Holder an
opportunity to increase its equity interest in
the Company through the acquisition of
shares of its Series B Convertible
Preferred Stock, $.0l par value per share
("Series B Stock"), upon the exercise
of a warrant with respect thereto;
NOW, THEREFORE,
in consideration of the foregoing and other good and
valuable consideration, the receipt of
which is hereby acknowledged, the Company
certifies and agrees as follows:
This Warrant
certifies that, for value received, ______________ (the
"Holder"), or registered assigns, is
entitled to purchase from the Company XXXXX
(as adjusted from time to time pursuant to
Section 6 hereof, the "Original
Number") shares of the fully paid and
non-assessable Series B Stock of the
Company, at a price of $4.3147358 per share
(the "Exercise Price").
Notwithstanding the foregoing, if the
Series B Stock shall prior to exercise or
exchange of this Warrant have been
converted into Common Stock, $.01 par value
(the "Common Stock") of the Company as a
result of mandatory conversion
("Mandatory Conversion Event") of the
Series B Stock as set forth in Article IV,
Section E5 of the Amended and Restated
Certificate of Incorporation of the
Company (as the same may be further
amended, restated or in effect from time to
time, the "Charter"), then from and after
the date of the Mandatory Conversion
Event, this Warrant shall be exercisable
for that number of shares of Common
Stock that is equal to the Original Number
multiplied by the Conversion Factor
(as defined below). The Conversion Factor
shall equal the number of shares of
Common Stock that each share of outstanding
Series B Stock converted into on the
date of the Mandatory Conversion Event.
Upon the occurrence of the Mandatory
Conversion Event, the Exercise Price then
in effect (the "Original Exercise
Price") shall be adjusted to a number that
is equal to the Original Exercise
Price divided by the Conversion Factor.
This Warrant may be exercised at any
time on or before the "Expiration Date"
which shall mean the date that is seven
(7) years after the date hereof. This
Warrant is issued as of September __, 2001
(the "Issue Date") pursuant to that certain
Series B Convertible Preferred Stock
and Warrant Purchase Agreement dated as of
September __, 2001. The shares of
capital stock of the Company issuable upon
exercise or exchange of this Warrant
are sometimes hereinafter referred to as
the "Warrant Shares," and, in
connection therewith, all references herein
to Warrant Shares shall mean Series
B Stock until the occurrence of a Mandatory
Conversion Event, and upon and at
all times after, the occurrence of a
Mandatory Conversion Event, shall mean
Common Stock. As used herein, the term
"Warrant Class" shall mean (i) prior to
the occurrence of the Mandatory Conversion
Event, the Series B Stock and (ii)
after the occurrence of the Mandatory
Conversion Event, the Common Stock.
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1. EXERCISE OF
WARRANT.
1.1. PROCEDURE.
The Holder or any person or entity to whom the Holder has
assigned its rights under this Warrant
(collectively referred to as the
"Warrantholder") may exercise this Warrant,
at any time or from time to time,
prior to the Expiration Date, on any
business day, by surrendering the Warrant,
accompanied by a written notice in the form
attached hereto (the "Exercise
Notice"), to the Company at the address
designated in Section 8.4 hereof,
exercising this Warrant and specifying the
total number of Warrant Shares the
Warrantholder will purchase pursuant to
such exercise. This Warrant may be
exercised in whole or in part as to any or
all of the Warrant Shares. A
certificate or certificates for the Warrant
Shares purchased upon exercise of
this Warrant and, in the event of a partial
exercise of this Warrant, a new
Warrant of like tenor representing the
balance of Warrant Shares purchasable
hereunder, shall be delivered by the
Company to the Warrantholder not later than
ten days after payment is made for the
Warrant Shares purchased upon such
partial exercise. No fractions of a share
of capital stock will be issued upon
the exercise of this Warrant, but if a
fractional share would be issuable upon
exercise, the Company will pay in cash the
fair market value thereof as
determined under Section 1.2 below.
1.2. NET
EXERCISE FORMULA. The Warrantholder may exercise this Warrant
either (i) by paying to the Company, by
cash or check, an amount equal to the
aggregate Exercise Price of the Warrant
Shares being purchased, or (ii) by
electing to receive Warrant Shares equal to
the value (as determined below) of
this Warrant by surrender of this Warrant
together with notice of such election,
in which event the Company shall issue to
the Warrantholder a number of Warrant
Shares computed using the following
formula:
X = Y(A-B)
------
A
Where: X = the number of Warrant Shares to
be issued to the Warrantholder.
Y = the number of Warrant Shares under this Warrant (or such
lesser
number of
Warrant Shares as the Warrantholder elects to purchase, in the
case of a
partial exercise).
A = the fair market value of one Warrant Share.
B = the Exercise Price.
As used herein,
the fair market value of one Warrant Share shall mean:
(i) After the
Mandatory Conversion Event (A) (1) if the Common Stock of the
Company is not then traded on a national
securities exchange, the average of the
closing prices quoted on the National
Association of Securities Dealers, Inc.
Automated Quotation National Market System,
if applicable, or the average of the
last bid and asked prices of the Common
Stock quoted in the
over-the-counter-market or (2) if the
Common Stock is then traded on a national
securities exchange, the average of the
high and low prices of the Common Stock
listed on the principal national securities
exchange on which the Common Stock
is so traded, in each case for the twenty
(20) trading days immediately
preceding the determination date or, if
such date is not a business day on which
shares are traded, the next immediately
preceding trading day;
(B) in all other circumstances, the fair market value per share
of Common Stock as determined by the
Company's Board of Directors in good faith
after taking into consideration all factors
it deems appropriate, including,
without limitation, recent sale and offer
prices of the capital stock of the
Company in private transactions negotiated
at arm's length; provided that in the
event the Warrantholder disagrees with the
fair market value determined by the
Board of Directors, the Company and the
Warrantholder shall use their best
efforts to agree upon the selection of an
independent appraiser, who will have
30 days in which to determine the fair
market value of the Common Stock, and
whose determination will be final and
binding on all parties concerned with all
costs of such determination to be borne by
the Company;
(ii) Prior to
the Mandatory Occurrence Event, the fair market value per
share of Series B Stock as determined by
the Company's Board of Directors in
good faith after taking into consideration
all factors it deems appropriate,
including, without limitation, recent sale
and offer prices of the capital stock
of the Company in private
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transactions negotiated at arm's length and
the privileges and preferences of
the Series B Stock, provided that in the
event the Warrantholder disagrees with
the fair market value determined by the
Board of Directors, the Company and the
Warrantholder disagrees with the fair
market value determined by the Board of
Directors, the Company and the
Warrantholder shall use their best efforts to
agree upon the selection of an independent
appraiser, who will have 30 days in
which to determine the fair market value of
the Series B Stock, and whose
determination will be final and binding on
all parties concerned with all costs
of such determination to be borne by the
Company.
1.3. AUTOMATIC
EXERCISE. To the extent this Warrant is not previously
exercised, and if the fair market value (as
determined in accordance with
Section 1.2 above) of one Warrant Share is
greater than the Exercise Price, as
adjusted, this Warrant shall be deemed
automatically exercised in accordance
with Section 1.2 hereof (even if not
surrendered) immediately prior to the close
of business on the Expiration Date or if
such date is not a business day in
Boston, on the business day next preceding
the Expiration Date. For purposes of
such automatic exercise, the fair market
value of one Warrant Share shall be the
fair market value determined pursuant to
Section 1.2 above. To the extent this
Warrant or any portion thereof is deemed
automatically exercised pursuant to
this Section 1.3, the Company agrees to
notify Warrantholder within a reasonable
period of time of the number of shares of
the Company's capital stock, if any,
the Warrantholder is to receive by reason
of such automatic exercise. The
Company shall not be required to deliver
any share certificates evidencing any
shares of capital stock issuable upon such
automatic exercise unless and until
the Company has received the original of
this Warrant or a Lost Warrant
Certificate (as defined below).
1.4. LOST,
STOLEN, MUTILATED OR DESTROYED WARRANT. If this Warrant is
lost,
stolen mutilated or destroyed, the Company
may require the Warrantholder to
provide a certificate ("Lost Warrant
Certificate"), which may contain terms as
to indemnity or otherwise as it may require
in its reasonable discretion (which
shall, in the case of a mutilated Warrant,
include the surrender thereof), issue
a replacement Warrant of like denomination
and tenor as the Warrant so lost,
stolen, mutilated or destroyed.
2. RECORD
HOLDER. A Warrant shall be deemed to have been exercised
immediately prior to the close of business
on the date of its surrender for
exercise as provided in Section 1.1 above
and the person entitled to receive the
Warrant Shares issuable upon such exercise
or conversion shall be treated for
all purposes as the holder of such Warrant
Shares of record as of the close of
business on such date. In the event of an
automatic exercise pursuant to Section
1.3 above, the person entitled to receive
the Warrant Shares shall be treated
for all purposes as the holder of such
Warrant Shares of record as of the close
of business on the Expiration Date.
3. PAYMENT OF
TAXES. The Company shall pay all taxes and other governmental
charges (other than income taxes) that may
be imposed in respect of the issue of
delivery of the Warrant Shares or any
portion thereof. The Company shall not be
required, however, to pay any tax or other
charge imposed in connection with any
transfer involved in the issue of any
certificate for the Warrant Shares or any
portion thereof in any name other than that
of the registered holder of this
Warrant surrendered in connection with the
purchase of such shares, and in such
case the Company shall not be required to
issue or deliver any certificate until
such tax or other charge has been paid or
it has been established to the
Company's satisfaction that no tax or other
charge is due.
4. TRANSFER AND
EXCHANGE.
4.1. TRANSFER.
Subject to the terms hereof, including, without limitation,
Sections 5.1 and 5.3, this Warrant and all
rights thereunder are transferable,
in whole or in part, on the books of the
Company maintained for such purpose at
its office designated in Section 8.4 hereof
by the registered holder hereof in
person or by duly authorized attorney, upon
surrender of this Warrant property
endorsed. Upon any partial exercise or
transfer, the Company will issue and
deliver to such holder a new warrant or
warrants with respect to the Warrant
Shares not so exercised, converted or
transferred. Each taker and holder of the
Warrant, by taking or holding the same,
consents and agrees that this Warrant
when endorsed in blank shall be deemed
negotiable, and that when this Warrant
shall have been so endorsed, the holder may
be treated by the Company and all
other persons dealing with this Warrant as
the absolute owner of such Warrant
for any purpose and as the person entitled
to exercise the rights represented
thereby, or to the transfer on the books of
the Company, any notice to the
contrary notwithstanding; but until such
transfer on such books, the Company may
treat the registered holder of this Warrant
as the owner for all purposes. The
term "Warrant" as used herein shall include
this Warrant and, any warrants
delivered in substitution or exchange
therefor as provided herein.
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4.2. EXCHANGE.
The Warrant is exchangeable for a warrant or warrants for
the same aggregate number of Warrant
Shares, each new Warrant to represent the
right to purchase such number of Warrant
Shares as the holder shall designate at
the time of such exchange. The Warrant may
be subdivided, at the Warrantholder's
option, into several warrants to purchase
the Warrant Shares (collectively, also
referred to as the "Warrant"). Such
subdivision may be accomplished in
accordance with the provisions of this
Section 4.
5. TRANSFER OF
SECURITIES
5.1.
RESTRICTIONS ON TRANSFER. Neither this Warrant nor the Warrant
Shares
shall be transferable except upon the
conditions specified in this Section 5.1,
which conditions are intended to insure
compliance with the provisions of the
Securities Act of 1933, as amended (the
"Securities Act") in respect to the
transfer of this Warrant and the Warrant
Shares.
5.1.1. Unless and until otherwise permitted by this Section 5.1,
this
Warrant and each certificate or other
document evidencing any of the Warrant
Shares shall be endorsed with the legends
substantially in the following form:
THESE SECURITIES HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND MAY NOT BE SOLD, PLEDGED OR
OTHERWISE TRANSFERRED UNLESS (A)
COVERED BY AN EFFECTIVE REGISTRATION
STATEMENT UNDER SUCH ACT, (B) THE COMPANY
HAS BEEN FURNISHED WITH AN OPINION OF
COUNSEL REASONABLY ACCEPTABLE TO THE
COMPANY TO THE EFFECT THAT NO REGISTRATION
IS REQUIRED FOR SUCH TRANSFER OR (C)
SUCH TRANSFER IS MADE IN ACCORDANCE WITH
THE PROVISIONS OF REGULATION S UNDER
THE ACT. HEDGING TRANSACTIONS INVOLVING
THESE SHARES MAY NOT BE CONDUCTED UNLESS
IN COMPLIANCE WITH THE ACT.
The foregoing legend shall be removed from
the certificates representing any
Warrant Shares, at the request of the
Warrantholder, (x) upon any sale pursuant
to an effective registration statement
under the Securities Act, Section 4(1) of
the Securities Act or Rule 144 under the
Securities Act or (y) at such time as
they become eligible for sale under Rule
144(k) under the Securities Act.
THE SHARES OF STOCK REPRESENTED BY THIS
CERTIFICATE ARE SUBJECT TO CERTAIN
VOTING AGREEMENTS AS SET FORTH IN A
STOCKHOLDERS' VOTING AGREEMENT, AS AMENDED
FROM TIME TO TIME, BY AND AMONG THE
REGISTERED OWNER OF THIS CERTIFICATE, THE
COMPANY AND CERTAIN OTHER STOCKHOLDERS OF
THE COMPANY, A COPY OF WHICH IS
AVAILABLE FOR INSPECTION AT THE OFFICES OF
THE SECRETARY OF THE COMPANY.
THE SALE OR OTHER DISPOSITION OF ANY OF THE
SHARES REPRESENTED BY THIS
CERTIFICATE IS RESTRICTED BY A RIGHT OF
FIRST REFUSAL AND CO-SALE AGREEMENT,
DATED AS OF SEPTEMBER __, 2001 AS AMENDED
FROM TIME TO TIME, AMONG CERTAIN OF
THE STOCKHOLDERS OF THIS COMPANY AND THIS
COMPANY (THE "AGREEMENT"). A COPY OF
THE AGREEMENT IS AVAILABLE FOR INSPECTION
DURING NORMAL BUSINESS HOURS AT THE
PRINCIPAL EXECUTIVE OFFICE OF THIS
COMPANY.
5.1.2. Neither this Warrant nor the Warrant Shares shall be
transferred and the Company shall not be
required to register any such transfer,
unless and until one of the following
events shall have occurred:
(a) (i) the
Warrant or the Warrant Shares, as the case may be, first shall
have been registered under the Securities
Act, or (ii) the Company first shall
have been furnished with an opinion of
legal counsel, reasonably satisfactory to
the Company, to the effect that such sale
or transfer is exempt from the
registration requirements of the Securities
Act.
(b)
Notwithstanding the foregoing, no registration or opinion of
counsel
shall be required for (i) a transfer by a
Warrantholder to an affiliate (as such
term is defined in the Securities Act) of
such Warrantholder, (ii) a transfer by
a Warrantholder which is a partnership to a
partner of such partnership or a
retired partner of such
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partnership who retires after the date
hereof, or to the estate of any such
partner or retired partner, or (iii) a
transfer by a Warrantholder which is a
limited liability company to a member of
such limited liability company or a
retired member who resigns after the date
hereof or to the estate of any such
member or retired member; provided that the
transferee in each case agrees in
writing to be subject to the terms of this
Section 5 to the same extent as if it
were the original Warrantholder hereunder,
or (iv) a transfer made in accordance
with Rule 144 under the Securities Act.
(c) For purposes
of this Section 5, "Warrant Shares" shall mean the Warrant
Shares and any other shares of capital
stock of the Company issued in respect of
such shares (as a result of stock splits,
stock dividends, reclassifications,
recapitalizations, or similar events).
5.2.
COOPERATION. The Company shall cooperate in supplying such
information
as may be reasonably requested by the
Warrantholder to complete and file any
information reporting forms presently or
subsequently required by the Commission
as a condition to the availability of an
exemption, presently existing or
subsequently adopted, from the Securities
Act for the sale of this Warrant or
Warrant Shares.
5.3. PERMITTED
TRANSFERS. The Warrantholder may, subject to all applicable
laws and rules, transfer this Warrant and
any Warrant Shares purchased
hereunder.
6. ADJUSTMENTS
TO EXERCISE PRICE AND WARRANT SHARES. The Exercise Price in
effect from time to time and the number of
Warrant Shares shall be subject to
adjustment in certain cases as set forth in
this Section 6.
6.1. SUBDIVISION
OR COMBINATION. In the event the outstanding shares of the
Warrant Class shall be subdivided into a
greater number of shares of such class,
