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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.
WARRANT TO PURCHASE
SHARES OF COMMON STOCK
OF
BIOFORCE NANOSCIENCES HOLDINGS, INC.
Expires June 10, 2013
Date of Issuance: June 10, 2008 Number of Shares: ________
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
_____________ Thousand (________) shares (subject to adjustment
as hereinafter
provided, the "Warrant Share Number") of the duly authorized,
validly issued,
fully paid and non-assessable Common Stock of the Issuer, at an
exercise price
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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 8 hereof.
1. Term. The term of this Warrant shall commence on June 10,
2008 and
shall expire at 6:00 p.m., eastern time, on June 10, 2013 (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 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 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. 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, 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.
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.
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(c) 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.
(d) Transferability of Warrant. Subject to Section 2(e) 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.
(e) 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
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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, 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.
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(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(e), 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(e) shall be
in
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.
(f) 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.
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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).
(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
(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.
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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
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
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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
(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:
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(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
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 combinat
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