EXHIBIT 4.3
ANNEX B (TO SUBSCRIPTION AGREEMENT)
ANTI-DILUTION RIGHTS
IR BioSciences Holdings, Inc. hereby grants to the Subscriber the
following anti-dilution rights.
1. DEFINITIONS. Capitalized terms used herein without definition shall
have the respective meanings given such terms as set forth in: (i) the
Subscription Agreement between IR BioSciences Holdings, Inc. and the subscriber
signatory thereto (the "SUBSCRIPTION AGREEMENT"), or (ii) the Warrant
certificate issued to the Subscriber in connection with the Placement or (iii)
in the Company's Confidential Private Placement Memorandum, dated as of
September 3, 2004 (as amended or supplemented, and together with all documents
and filings attached thereto, the "MEMORANDUM"). As used herein, the following
capitalized terms have the following meanings:
(a) "DISCOUNTED PRICE" means an amount per share of Common
Stock (or other securities convertible into Common Stock) less than the
lowest Common Stock Purchase Price calculated for any Closing, as
adjusted pursuant to the terms of the Subscription Agreement and
Memorandum.
(b) "DISCOUNTED PRICE TRANSACTION" each sale or issuance of
Common Stock (or other securities convertible into Common Stock) at a
Discounted Price.
2. ISSUANCES OF ADDITIONAL SHARES OF COMMON STOCK.
(a) If, at any time prior to the first anniversary of the
Final Closing Date, the Company shall issue or sell any shares of
Common Stock (or other securities convertible into Common Stock) at a
Discounted Price, then each Subscriber shall, within 30 days of the
applicable Discounted Price Transaction, be issued by the Company (the
"ANTI-DILUTION Issuance") a number of additional shares of Common Stock
so that the sum of the number of shares of Common Stock issued to such
Subscriber in the Placement and in the Anti-Dilution Issuance shall,
collectively, be equal to the number of shares of Common Stock which is
the product of:
(i) such Subscriber's average Common Stock Purchase
Price, MULTIPLIED BY
(ii) the weighted average sales price for all sales
of Common Stock in the Closings of the Placement and in all
subsequent Discounted Price Transactions.
(b) The provisions of paragraph (a) of this Section 2 shall
not apply to any issuance of shares of Common Stock for which an
adjustment is provided under Sections 6(a) or 6(b) of the Warrant.
(c) No additional shares of Common Stock will be issued upon
the issuance of any shares of Common Stock which are issued pursuant to
the exercise of any warrants or other
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subscription or purchase rights or pursuant to the exercise of any
conversion or exchange rights in any Convertible Securities, if any
such adjustment shall previously have been made upon the issuance of
such warrants or other rights or upon the issuance of such Convertible
Securities (or upon the issuance of any warrant or other rights
therefor) pursuant to Section 6(d) or Section 6(e) of the Warrant.
(d) No additional shares of Common Stock will be issued due
to, or as a result of, any Permitted Issuances. "PERMITTED ISSUANCES"
shall mean (i) Common Stock issued pursuant to a stock split or
subdivision, (ii) Common Stock issuable or issued to employees,
consultants or directors of the Company directly or pursuant to a stock
plan or other compensation arrangement approved by the Board of
Directors of the Company at the then fair market value, (iii) capital
stock, debt instruments convertible into capital stock or warrants or
options to purchase capital stock issued in connection with bona fide
acquisitions, mergers, technology licenses or purchases, corporate
partnering agreements, joint ventures or similar transactions, the
terms of which are approved by the Board of Directors of the Company,
and (v) Common Stock issued or issuable upon conversion of the Warrants
or any other securities exercisable or exchangeable for, or convertible
into shares of Common Stock outstanding as of September 3, 2004.
3. PROCEDURES FOR ISSUANCES OF ADDITIONAL SHARES OF COMMON STOCK. The
Company may retain a firm of independent public accountants of recognized
standing selected by the Company's board of directors (who may be the regular
accountants employed by the Company) to make any computation required by this
ANNEX B.
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