Exhibit 5
THIS WARRANT AND THE WARRANT SHARES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 AND THIS WARRANT MAY NOT BE EXERCISED BY OR ON
BEHALF OF A U.S. PERSON UNLESS REGISTERED UNDER THE SECURITIES ACT OF 1933
OR AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.
THIS WARRANT AND THE WARRANT SHARES SHALL NOT BE SOLD OR TRANSFERRED EXCEPT
(A) IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S UNDER THE ACT, (B)
PURSUANT TO REGISTRATION UNDER THE ACT OR (C) PURSUANT TO AN AVAILABLE
EXEMPTION FROM REGISTRATION UNDER THE ACT. HEDGING TRANSACTIONS INVOLVING THIS
WARRANT AND THE WARRANT SHARES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH
THE SECURITIES ACT.
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUED UPON ITS
EXERCISE ARE SUBJECT TO THE RESTRICTIONS ON
TRANSFER SET FORTH IN SECTION 4 OF THIS WARRANT
Date of Issuance: August 28, 2003 Number of Shares: 587,709
(subject to adjustment)
HYBRIDON, INC.
Common Stock Purchase Warrant
(Void after August 28, 2008)
Hybridon, Inc., a Delaware corporation (the "Company"), for value
received, hereby certifies that Pillar Investment Limited, or his or its
registered assigns (the "Registered Holder"), is entitled, subject to the terms
and conditions set forth below, to purchase from the Company, at any time or
from time to time on or after the date of issuance and on or before 5:00 p.m.
(Boston time) on August 28, 2008, 587,709 shares of Common Stock, $0.001 par
value per share, of the Company ("Common Stock"), at a purchase price of $1.00
per share. The shares purchasable upon exercise of this Warrant, and the
purchase price per share, each as adjusted from time to time pursuant to the
provisions of this Warrant, are hereinafter referred to as the "Warrant Shares"
and the "Purchase Price," respectively.
1. Exercise.
(a) Exercise for Cash. The Registered Holder may, at its
option, elect to exercise this Warrant, in whole or in part and at any time or
from time to time, by surrendering this Warrant, with the purchase form appended
hereto as Exhibit I duly executed by or on behalf of the Registered Holder, at
the principal office of the Company, or at such other office or agency as the
Company may designate, accompanied by payment in full, in lawful money of the
United States, of the Purchase Price payable in respect of the number of Warrant
Shares purchased upon such exercise.
(b) Cashless Exercise.
(i) The Registered Holder may, at its option,
elect to exercise this Warrant, in whole or in part and at any time or from time
to time, on a cashless basis, by surrendering this Warrant, with the purchase
form appended hereto as Exhibit I duly executed by or on behalf of the
Registered Holder, at the principal office of the Company, or at such other
office or agency as the Company may designate, by canceling a portion of this
Warrant in payment of the Purchase Price payable in respect of the number of
Warrant Shares purchased upon such exercise. In the event of an exercise
pursuant to this subsection 1(b), the number of Warrant Shares issued to the
Registered Holder shall be determined according to the following formula:
X = Y(A-B)
-----
A
Where: X = the number of Warrant Shares that shall be issued to
the Registered Holder;
Y = the number of Warrant Shares for which this Warrant
is being exercised (which shall include both the
number of Warrant Shares issued to the Registered
Holder and the number of Warrant Shares subject to
the portion of the Warrant being cancelled in payment
of the Purchase Price);
A = the Fair Market Value (as defined below) of one share
of Common Stock; and
B = the Purchase Price then in effect.
(ii) The "Fair Market Value" per share of Common
Stock shall be determined as follows:
(1) If the Common Stock is listed on a
national securities exchange, the Nasdaq National Market, the Nasdaq SmallCap
Market, the OTC Bulletin Board or another nationally recognized trading system
as of the Exercise Date, the Fair Market Value per share of Common Stock shall
be deemed to be the average of the high and low reported sale prices per share
of Common Stock thereon for the five consecutive trading day period immediately
preceding the Exercise Date (as defined below); provided that if the Common
Stock is not so listed during such period, the Fair Market Value per share of
Common Stock shall be determined pursuant to clause (2).
(2) If the Common Stock is not listed
on a national securities exchange, the Nasdaq National Market, the Nasdaq
SmallCap Market, the OTC Bulletin Board or another nationally recognized trading
system as of the Exercise Date, the Fair Market Value per share of Common Stock
shall be deemed to be the amount most recently determined by the Board of
Directors of the Company or an authorized committee of the Board of Directors of
the Company (the "Board") to represent the fair market value per share of the
Common Stock (including without limitation a determination for purposes of
granting Common Stock options or
-2-
issuing Common Stock under any plan, agreement or arrangement with employees of
the Company); and, upon request of the Registered Holder, the Board (or a
representative thereof) shall, as promptly as reasonably practicable but in any
event not later than 15 days after such request, notify the Registered Holder of
the Fair Market Value per share of Common Stock. Notwithstanding the foregoing,
if the Board has not made such a determination within the three-month period
prior to the Exercise Date, then (A) the Board shall make, and shall provide or
cause to be provided to the Registered Holder notice of, a determination of the
Fair Market Value per share of the Common Stock within 15 days of a request by
the Registered Holder that it do so, and (B) the exercise of this Warrant
pursuant to this subsection 1(b) shall be delayed until such determination is
made and notice thereof is provided to the Registered Holder.
(c) Exercise Date. Each exercise of this Warrant shall be
deemed to have been effected immediately prior to the close of business on the
day on which this Warrant shall have been surrendered to the Company as provided
in subsection 1(a) or 1(b) above (the "Exercise Date"). At such time, the person
or persons in whose name or names any certificates for Warrant Shares shall be
issuable upon such exercise as provided in subsection 1(d) below shall be deemed
to have become the holder or holders of record of the Warrant Shares represented
by such certificates.
(d) Issuance of Certificates. As soon as practicable
after the exercise of this Warrant in whole or in part, and in any event within
10 days thereafter, the Company, at its expense, will cause to be issued in the
name of, and delivered to, the Registered Holder, or as the Registered Holder
(upon payment by the Registered Holder of any applicable transfer taxes) may
direct:
(i) a certificate or certificates for the number
of full Warrant Shares to which the Registered Holder shall be entitled upon
such exercise plus, in lieu of any fractional share to which the Registered
Holder would otherwise be entitled, cash in an amount determined pursuant to
Section 3 hereof; and
(ii) in case such exercise is in part only, a new
warrant or warrants (dated the date hereof) of like tenor, calling in the
aggregate on the face or faces thereof for the number of Warrant Shares equal
(without giving effect to any adjustment therein) to the number of such shares
called for on the face of this Warrant minus the number of Warrant Shares for
which this Warrant was so exercised (which, in the case of an exercise pursuant
to subsection 1(b), shall include both the number of Warrant Shares issued to
the Registered Holder pursuant to such partial exercise and the number of
Warrant Shares subject to the portion of the Warrant being cancelled in payment
of the Purchase Price).
(e) Exercise by Non-U.S. Person. It shall be a condition
to the exercise of this Warrant by a Registered Holder that is not a U.S. Person
(as defined under the Securities Act of 1933, as amended (the "Act")) that such
Registered Holder certify in writing to the Company that it is not a U.S. Person
and that this Warrant is not being exercised on behalf of a U.S. Person.
2. Adjustments.
-3-
(a) Adjustment for Stock Splits and Combinations. If the
Company shall at any time, or from time to time after the date on which this
Warrant was first issued (or, if this Warrant was issued upon partial exercise
of, or in replacement of, another warrant of like tenor, then the date on which
such original warrant was first issued) (either such date being referred to as
the "Original Issue Date") effect a subdivision of the outstanding Common Stock,
the Purchase Price then in effect immediately before that subdivision shall be
proportionately decreased. If the Company shall at any time, or from time to
time after the Original Issue Date combine the outstanding shares of Common
Stock, the Purchase Price then in effect immediately before the combination
shall be proportionately increased. Any adjustment under this paragraph shall
become effective at the close of business on the date the subdivision or
combination becomes effective.
(b) Adjustment for Certain Dividends and Distributions.
In the event the Company at any time, or from time to time after the Original
Issue Date shall make or issue, or fix a record date for the determination of
holders of Common Stock entitled to receive, a dividend or other distribution
payable in additional shares of Common Stock, then and in each such event the
Purchase Price then in effect immediately before such event shall be decreased
as of the time of such issuance or, in the event such a record date shall have
been fixed, as of the close of business on such record date, by multiplying the
Purchase Price then in effect by a fraction:
(1) the numerator of which shall be the
total number of shares of Common Stock issued and outstanding immediately prior
to the time of such issuance or the close of business on such record date, and
(2) the denominator of which shall be
the total number of shares of Common Stock issued and outstanding immediately
prior to the time of such issuance or the close of business on such record date
plus the number of shares of Common Stock issuable in payment of such dividend
or distribution;
provided, however, that if such record date shall have been fixed and such
dividend is not fully paid or if such distribution is not fully made on the date
fixed therefor, the Purchase Price shall be recomputed accordingly as of the
close of business on such record date and thereafter the Purchase Price shall be
adjusted pursuant to this paragraph as of the time of actual payment of such
dividends or distributions.
(c) Adjustment in Number of Warrant Shares. When any
adjustment is required to be made in the Purchase Price pursuant to subsections
2(a) or 2(b) above, the number of Warrant Shares purchasable upon the exercise
of this Warrant shall be changed to the number determined by dividing (i) an
amount equal to the number of shares issuable upon the exercise of this Warrant
immediately prior to such adjustment, multiplied by the Purchase Price in effect
immediately prior to such adjustment, by (ii) the Purchase Price in effect
immediately after such adjustment.
(d) Adjustments for Other Dividends and Distributions. In
the event the Company at any time, or from time to time after the Original Issue
Date shall make or issue, or fix a record date for the determination of holders
of Common Stock entitled to receive, a
-4-
dividend or other distribution payable in securities of the Company (other than
shares of Common Stock) or in cash or other property (other than regular cash
dividends paid out of earnings or earned surplus, determined in accordance with
generally accepted accounting principles), then and in each such event provision
shall be made so that the Registered Holder shall receive upon exercise hereof,
in addition to the number of shares of Common Stock issuable hereunder, the kind
and amount of securities of the Company, cash or other property which the
Registered Holder would have been entitled to receive had this Warrant been
exercised on the date of such event and had the Registered Holder thereafter,
during the period from the date of such event to and including the Exercise
Date, retained any such securities receivable during such period, giving
application to all adjustments called for during such period under this Section
2 with respect to the rights of the Registered Holder.
(e) Adjustment for Reorganization. If there shall occur
any reorganization, recapitalization, reclassification, consolidation or merger
involving the Company in which the Common Stock is converted into or exchanged
for securities, cash or other property (other than a transaction covered by
subsections 2(a), 2(b) or 2(d)) (collectively, a "Reorganization"), then,
following such Reorganization, the Registered Holder shall receive upon exercise
hereof the kind and amount of securities, cash or other property which the
Registered Holder would have been entitled to receive pursuant to such
Reorganization if such exercise had taken place immediately prior to such
Reorganization. In any such case, appropriate adjustment (as determined in good
faith by the Board) shall be made in the application of the provisions set forth
herein with respect to the rights and interests thereafter of the Registered
Holder, to the end that the provisions set forth in this Section 2 (including
provisions with respect to changes in and other adjustments of the Purchase
Price) shall thereafter be applicable, as nearly as reasonably may be, in
relation to any securities, cash or other property thereafter deliverable upon
the exercise of this Warrant.
(f) Certificate as to Adjustments. Upon the occurrence of
each adjustment or readjustment of the Purchase Price pursuant to this Section
2, the Company at its expense shall, as promptly as reasonably practicable but
in any event not later than 30 days thereafter, compute such adjustment or
readjustment in accordance with the terms hereof and furnish to the Registered
Holder a certificate setting forth such adjustment or readjustment (including
the kind and amount of securities, cash or other property for which this Warrant
shall be exercisable and the Purchase Price) and showing in detail the facts
upon which such adjustment or readjustment is based. The Company shall, as
promptly as reasonably practicable after the written request at any time of the
Registered Holder (but in any event not later than 30 days thereafter), furnish
or cause to be furnished to the Registered Holder a certificate setting forth
(i) the Purchase Price then in effect and (ii) the number of shares of Common
Stock and the amount, if any, of other securities, cash or property which then
would be received upon the exercise of this Warrant.
3. Fractional Shares. The Company shall not be required upon the
exercise of this Warrant to issue any fractional shares, but shall pay the value
thereof to the Registered Holder in cash on the basis of the Fair Market Value
per share of Common Stock, as determined pursuant to subsection 1(b)(ii) above.
4. Transfers, etc.
-5-
(a) Neither this Warrant nor the Warrant Shares shall be
sold or transferred unless either (i) they first shall have been registered
under the 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
Act. Notwithstanding the foregoing, no registration or opinion of counsel shall
be required for a transfer made in accordance with Rule 144 under the Act.
(b) Each certificate representing Warrant Shares shall
bear a legend substantially in the following form:
"The securities represented by this certificate have
not been registered under the Securities Act of 1933,
as amended, and may not be offered, sold or otherwise
transferred, pledged or hypothecated unless and until
such securities are registered under such Act or an
opinion of counsel satisfactory to the Company is
obtained to the effect that such registration is not
required."
The foregoing legend shall be removed from the certificates representing any
Warrant Shares, at the request of the holder thereof, at such time as they
become eligible for resale pursuant to Rule 144(k) under the Act.
(c) In the case of a Registered Holder that is a non-U.S.
Person:
(i) THIS WARRANT AND THE WARRANT SHARES HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND THIS WARRANT MAY NOT BE
EXERCISED BY OR ON BEHALF OF A U.S. PERSON UNLESS REGISTERED UNDER THE
SECURITIES ACT OF 1933 OR AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.
(ii) This Warrant and the Warrant Shares shall
not be sold or transferred except (A) in accordance with the provisions of
Regulation S under the Act, (B) pursuant to registration under the Act or (C)
pursuant to an available exemption from registration under the Act. Hedging
transactions involving this Warrant and the Warrant Shares may not be conducted
unless in compliance with the Securities Act.
(iii) Notwithstanding Section 4(b) to the
contrary, each certificate representing Warrant Shares issued to a Registered
Holder that is a non-U.S. Person shall bear a legend substantially in the
following form:
"These shares have not been registered under the Securities Act of
1933. They may not be offered or transferred by sale, assignment,
pledge or otherwise unless (i) a registration statement for the shares
under the Securities Act of 1933 is in effect or (ii) the corporation
has received an opinion of counsel, which opinion is satisfactory to
the corporation, to the effect that such registration is not required
under the Securities Act of 1933 or (iii) such offer or transfer is
made in accordance with the provisions of Regulation S under the
Securities Act of 1933. Hedging transactions involving these shares may
not be conducted unless in compliance with the Securities Act of 1933."
-6-
(d) The Company will maintain a register containing the
name and address of the Registered Holder of this Warrant. The Registered Holder
may change its address as shown on the warrant register by written notice to the
Company requesting such change.
(e) Subject to the provisions of Section 4 hereof, this
Warrant and all rights hereunder are transferable, in whole or in part, upon
surrender of this Warrant with a properly executed assignment (in the form of
Exhibit II hereto) at the principal office of the Company (or, if another office
or agency has been designated by the Company for such purpose, then at such
other office or agency).
5. No Impairment. The Company will not, by amendment of its
charter or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities or any other voluntary 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 action as may be necessary or
appropriate in order to protect the rights of the Registered Holder against
impairment.
6. Notices of Record Date, etc. In the event:
(a) the Company shall take a record of the holders of its
Common Stock (or other stock or securities at the time deliverable upon the
exercise of this Warrant) for the purpose of entitling or enabling them to
receive any dividend or other distribution, or to receive any right to subscribe
for or purchase any shares of stock of any class or any other securities, or to
receive any other right; or
(b) of any capital reorganization of the Company, any
reclassification of the Common Stock of the Company, any consolidation or merger
of the Company with or into another corporation (other than a consolidation or
merger in which the Company is the surviving entity and its Common Stock is not
converted into or exchanged for any other securities or property), or any
transfer of all or substantially all of the assets of the Company; or
(c) of the voluntary or involuntary dissolution,
liquidation or winding-up of the Company,
then, and in each such case, the Company will send or cause to be sent to the
Registered Holder a notice specifying, as the case may be, (i) the record date
for such dividend, distribution or right, and the amount and character of such
dividend, distribution or right, or (ii) the effective date on which such
reorganization, reclassification, consolidation, merger, transfer, dissolution,
liquidation or winding-up is to take place, and the time, if any is to be fixed,
as of which the holders of record of Common Stock (or such other stock or
securities at the time deliverable upon the exercise of this Warrant) shall be
entitled to exchange their shares of Common Stock (or such other stock or
securities) for securities or other property deliverable upon such
reorganization, reclassification, consolidation, merger, transfer, dissolution,
liquidation or winding-up. Such notice shall be sent at least 10 days prior to
the record date or effective date for the event specified in such notice.
7. Reservation of Stock. The Company will at all times reserve
and keep available, solely for issuance and delivery upon the exercise of this
Warrant, such number of Warrant
-7-
Shares and other securities, cash and/or property, as from time to time shall be
issuable upon the exercise of this Warrant.
8. Exchange or Replacement of Warrants.
(a) Upon the surrender by the Registered Holder, properly
endorsed, to the Company at the principal office of the Company, the Company
will issue and deliver to or upon the order of the Registered Holder, at the
Company's expense, a new Warrant or Warrants of like tenor, in the name of the
Registered Holder or as the Registered Holder (upon payment by the Registered
Holder of any applicable transfer taxes) may direct, calling in the aggregate on
the face or faces thereof for the number of shares of Common Stock (or other
securities, cash and/or property) then issuable upon exercise of this Warrant.
(b) Upon receipt of evidence reasonably satisfactory to
the Company of the loss, theft, destruction or mutilation of this Warrant and
(in the case of loss, theft or destruction) upon delivery of an indemnity
agreement (with surety if reasonably required) in an amount reasonably
satisfactory to the Company, or (in the case of mutilation) upon surrender and
cancellation of this Warrant, the Company will issue, in lieu thereof, a new
Warrant of like tenor.
9. Notices. All notices and other communications from the Company
to the Registered Holder in connection herewith shall be mailed by certified or
registered mail, postage prepaid, or sent via a reputable overnight courier
service to the address last furnished to the Company in writing by the
Registered Holder. All notices and other communications from the Registered
Holder to the Company in connection herewith shall be mailed by certified or
registered mail, postage prepaid, or sent via a reputable overnight courier
service to the Company at its principal office set forth below. If the Company
should at any time change the location of its principal office to a place other
than as set forth below, it shall give prompt written notice to the Registered
Holder and thereafter all references in this Warrant to the location of its
principal office at the particular time shall be as so specified in such notice.
All such notices and communications shall be deemed delivered (i) two business
days after being sent by certified or registered mail, return receipt requested,
postage prepaid, or (ii) two business days after being sent via a reputable
overnight courier service.
10. No Rights as Stockholder. Until the exercise of this Warrant,
the Registered Holder shall not have or exercise any rights by virtue hereof as
a stockholder of the Company. Notwithstanding the foregoing, in the event (i)
the Company effects a split of the Common Stock by means of a stock dividend and
the Purchase Price of and the number of Warrant Shares are adjusted as of the
date of the distribution of the dividend (rather than as of the record date for
such dividend), and (ii) the Registered Holder exercises this Warrant between
the record date and the distribution date for such stock dividend, the
Registered Holder shall be entitled to receive, on the distribution date, the
stock dividend with respect to the shares of Common Stock acquired upon such
exercise, notwithstanding the fact that such shares were not outstanding as of
the close of business on the record date for such stock dividend.
11. Amendment or Waiver. Any term of this Warrant may be amended
or waived only by an instrument in writing signed by the party against which
enforcement of the change or waiver is sought. No waivers of any term, condition
or provision of this Warrant, in any one or
-8-
more instances, shall be deemed to be, or construed as, a further or continuing
waiver of any such term, condition or provision.
12. Section Headings. The section headings in this Warrant are for
the convenience of the parties and in no way alter, modify, amend, limit or
restrict the contractual obligations of the parties.
13. Governing Law. This Warrant will be governed by and construed
in accordance with the internal laws of the State of Delaware (without reference
to the conflicts of law provisions thereof).
14. Facsimile Signatures. This Warrant may be executed by
facsimile signature.
15. Acceptance by Registered Holder. By acquiring and accepting
this Warrant, the Registered Holder shall be deemed to have agreed and accepted
the terms and conditions of this Warrant.
EXECUTED as of the Date of Issuance indicated above.
HYBRIDON, INC.
By: /s/ Xxxxxx Xxxxxxxx
-------------------------------
Title: Chief Financial Officer
-9-
EXHIBIT I
PURCHASE FORM
To:_________________ Dated:____________
The undersigned, pursuant to the provisions set forth in the attached
Warrant (No. ___), hereby elects to purchase (check applicable box):
- ____ shares of the Common Stock of Hybridon, Inc. covered by
such Warrant; or
- the maximum number of shares of Common Stock covered by such
Warrant pursuant to the cashless exercise procedure set forth in subsection
1(b).
The undersigned herewith makes payment of the full purchase price for
such shares at the price per share provided for in such Warrant. Such payment
takes the form of (check applicable box or boxes):
- $______ in lawful money of the United States; and/or
- the cancellation of such portion of the attached Warrant as is
exercisable for a total of _____ Warrant Shares (using a Fair
Market Value of $_____ per share for purposes of this
calculation); and/or
- the cancellation of such number of Warrant Shares as is
necessary, in accordance with the formula set forth in
subsection 1(b), to exercise this Warrant with respect to the
maximum number of Warrant Shares purchasable pursuant to the
cashless exercise procedure set forth in subsection 1(b).
Signature: ________________________
Address: __________________________
__________________________
-10-
EXHIBIT II
ASSIGNMENT FORM
FOR VALUE RECEIVED, ________________________________________ hereby
sells, assigns and transfers all of the rights of the undersigned under the
attached Warrant (No. ____) with respect to the number of shares of Common Stock
of Hybridon, Inc. covered thereby set forth below, unto:
Name of Assignee Address No. of Shares
Dated:_____________________ Signature:________________________________
Signature Guaranteed:
By: _______________________
The signature should be guaranteed by an eligible guarantor institution (banks,
stockbrokers, savings and loan associations and credit unions with membership in
an approved signature guarantee medallion program) pursuant to Rule 17Ad-15
under the Securities Exchange Act of 1934.
-11-
