NORTHWEST BIOTHERAPEUTICS, INC. AMENDED AND RESTATED SERIES A PREFERRED STOCK WARRANT
Exhibit 10.3
THIS WARRANT AND THE UNDERLYING SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “ACT”). THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO SUCH SECURITIES UNDER THE
ACT OR UNLESS SUCH TRANSACTION IS IN COMPLIANCE WITH APPLICABLE FEDERAL AND STATE SECURITIES
LAWS.
NORTHWEST BIOTHERAPEUTICS, INC.
AMENDED
AND RESTATED SERIES A PREFERRED STOCK WARRANT
| No. A&R PW-1 | June 1, 2007 |
This Certifies That, for value received, Toucan Capital Fund II, L.P., with
its principal office at 0000 Xxxxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxx, XX 00000, and/or its designees
or assigns (collectively, the “Holder”), is entitled to subscribe for and purchase from
Northwest Biotherapeutics, Inc., a Delaware corporation, with its principal office at
00000 000xx Xxxxxx XX, Xxxxx 000, Xxxxxxx, Xxxxxxxxxx 00000 (the “Company”), such number
of Exercise Shares as provided herein at the Exercise Price (each subject to adjustment as provided
herein). This Warrant is being amended and restated in its entirety as of June 1, 2007, and amends,
restates and supersedes in full that certain Warrant No. PW-1 dated as of January 26, 2005 issued
by the Company in favor of the Holder, which was issued pursuant to the terms of the
Recapitalization Agreement, dated April 26, 2004, as amended and restated on July 30, 2004, and as
further amended from time to time, by and among the Company and the Holder (the “Recapitalization
Agreement”)..
1. Definitions. Capitalized terms used but not defined herein shall have the meanings
set forth in the Recapitalization Agreement or the Related Recapitalization Documents, as
applicable. As used herein, the following terms shall have the following respective meanings:
(a) “Preferred Stock” shall mean the Series A Cumulative Convertible Preferred Stock, par
value, $0.001 per share of the Company.
(b) “Exercise Period” shall mean the period commencing on the date of issuance of this Warrant
and ending seven (7) years after January 26, 2005.
(c) “Exercise Price” shall mean $.04 per share (subject to adjustment pursuant to Section 5).
(d)
“Exercise Shares” shall mean 32,500,000
shares of Preferred Stock, plus additional shares of Preferred Stock (calculated on the basis of $0.04 per share) attributable to accrued and unpaid
dividends on the 32,500,000 shares of Preferred Stock represented by Certificate No. CPA-1, from
the date of issuance of the Preferred Stock until the date of conversion of such Preferred Stock
into Common Stock or, if earlier, the date of exercise of this Warrant, subject to adjustment
pursuant to the terms herein.
(e)
“Capital Stock” shall mean any equity
securities of the Company, of any class or series, and any securities
directly or indirectly convertible into or exchangeable or
exercisable for any equity securities.
1.
2. Exercise of Warrant. The rights represented by this Warrant may be exercised in
whole or in part at any time or times during the Exercise Period, by delivery of the following to
the Company at its address set forth above (or at such other address as it may designate by notice
in writing to the Holder):
(a) An executed Notice of Exercise in the form attached hereto;
(b) Payment of the Exercise Price either (i) in cash or by check, or (ii) by cancellation of
indebtedness; and
(c) This Warrant.
Upon the exercise of the rights represented by this Warrant, a certificate or certificates for
the Exercise Shares so purchased, registered in the name of the Holder or persons affiliated with
the Holder, if the Holder so designates, shall be issued and delivered to the Holder within a
reasonable time after the rights represented by this Warrant shall have been so exercised. In the
event that this Warrant is being exercised for less than all of the then-current number of Exercise
Shares purchasable hereunder, the Company shall, concurrently with the issuance by the Company of
the number of Exercise Shares for which this Warrant is then being exercised, issue a new Warrant
exercisable for the remaining number of Exercise Shares purchasable hereunder.
The person in whose name any certificate or certificates for Exercise Shares are to be issued
upon exercise of this Warrant shall be deemed to have become the holder of record of such shares on
the date on which this Warrant was surrendered and payment of the Exercise Price was made,
irrespective of the date of delivery of such certificate or certificates, except that, if the date
of such surrender and payment is a date when the stock transfer books of the Company are closed,
such person shall be deemed to have become the holder of such shares at the close of business on
the next succeeding date on which the stock transfer books are open.
2.1 Net Exercise. Notwithstanding any provisions herein to the contrary, if the fair market
value of one Exercise Share is greater than the Exercise Price (at the date of calculation as set
forth below), in lieu of exercising this Warrant by payment of cash, the Holder may elect to
receive shares equal to the value (as determined below) of this Warrant (or the portion thereof
being canceled) by surrender of this Warrant at the principal office of the Company together with
the properly endorsed Notice of Exercise in which event the Company shall issue to the Holder a
number of Exercise Shares computed using the following formula:
X =
|
Y (A-B) |
Where X =
|
the number of Exercise Shares to be issued to the Holder | |
Y =
|
the number of Exercise Shares purchasable under the Warrant or, if only a portion of the Warrant is being exercised, that portion of the Warrant being canceled (at the date of such calculation) | |
A =
|
the fair market value of one Exercise Share (at the date of such calculation) |
2.
B =
|
Exercise Price (as adjusted to the date of such calculation) |
For purposes of the above calculation, the fair market value of one Exercise Share shall be
determined by the Company’s Board of Directors in good faith; provided, however, that in the event
that this Warrant is exercised pursuant to this Section 2.1 in connection with the Company’s
initial public offering of its Common Stock, the fair market value per share shall be the product
of (i) the per share offering price to the public of the Company’s initial public offering, and
(ii) the number of shares of Common Stock into which each Exercise Share is convertible at the time
of such exercise.
3. Covenants of the Company.
3.1 Covenants as to Exercise Shares. The Company covenants and agrees that all Exercise Shares
that may be issued upon the exercise of the rights represented by this Warrant will, upon issuance,
be validly issued and outstanding, fully paid and nonassessable, and free from all taxes, liens and
charges with respect to the issuance thereof. The Company further covenants and agrees that the
Company will at all times during the Exercise Period, have authorized and reserved, free from
preemptive rights, a sufficient number of shares of the series of equity securities comprising the
Exercise Shares and the Company’s Common Stock to provide for the exercise of the rights
represented by this Warrant and the subsequent conversion of the Exercise Shares. If at any time
during the Exercise Period the number of authorized but unissued shares of such series of the
Company’s equity securities or the Company’s Common Stock shall not be sufficient to permit
exercise of this Warrant or the subsequent conversion of the Exercise Shares, the Company will take
such corporate action as shall be necessary to increase its authorized but unissued shares of such
series of the Company’s equity securities or the Company’s Common Stock, as appropriate, to such
number of shares as shall be sufficient for such purposes.
3.2 Notices of Record Date. In the event of any taking by the Company of a record of the
holders of any class of securities for the purpose of determining the holders thereof who are
entitled to receive any dividend or other distribution, the Company shall mail to the Holder, at
least ten (10) days prior to the date specified herein, a notice specifying the date on which any
such record is to be taken for the purpose of such dividend or distribution.
3.3 No Impairment. The Company shall not, by amendment of its Certificate of Incorporation or
through a reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of
securities, or any other voluntary action, omission or agreement, avoid or seek to avoid the
observance or performance of any of the terms to be observed or performed by the Company under
and/or in connection with this Warrant, but shall at all times in good faith use best efforts to
assist in carrying out of all the provisions of and/or relating to this Warrant and in taking all
such action as may be necessary or appropriate to protect Holder’s rights, preferences and
privileges under and/or in connection with this Warrant against impairment. The Holder’s rights,
preferences and privileges granted under and/or in connection with this Warrant may not be amended,
modified or waived without the Holder’s prior written consent, and the documentation providing for
such rights, preferences and privileges will specifically provide as such.
3.
3.4 Registration Rights. The Company agrees that the Underlying Shares (as defined below)
shall be “registrable securities” (or terms of similar impact) under any agreement executed by the
Company as part of the Anticipated Equity Financing, or any other agreement executed by the Company
in lieu of, and/or in addition to, the Anticipated Equity Financing, in each case, for purposes of
providing registration rights under the Act to holders of shares of capital stock of the Company,
and the Company shall ensure that any such agreement conforms with the requirements of this Section
3.4. Such registration rights may not be amended, modified or waived without the prior written
consent of the Holder.
4. Representations of Holder.
4.1 Acquisition of Warrant for Personal Account. The Holder represents and warrants that it is
acquiring the Warrant, the Exercise Shares and the shares of Common Stock issuable upon conversion
of the Exercise Shares (the “Underlying Shares”) solely for its account for investment and not with
a view to or for sale or distribution of said Warrant, Exercise Shares or Underlying Shares or any
part thereof except in compliance with applicable federal and state securities laws. The Holder
also represents that the entire legal and beneficial interests of the Warrant, the Exercise Shares
and the Underlying Shares the Holder is acquiring is being acquired for, and will be held for, its
account only.
4.2 Securities Are Not Registered.
(a) The Holder understands that the Warrant, the Exercise Shares and the Underlying Shares
have not been registered under the Securities Act of 1933, as amended (the “Act”) on the basis that
no distribution or public offering of the stock of the Company is to be effected by the Holder. The
Holder realizes that the basis for the exemption may not be present if, notwithstanding its
representations, the Holder has a present intention of acquiring the securities for a fixed or
determinable period in the future, selling (in connection with a distribution or otherwise),
granting any participation in, or otherwise distributing the securities. The Holder has no such
present intention.
(b) The Holder recognizes that the Warrant, the Exercise Shares and the Underlying Shares must
be held indefinitely unless they are subsequently registered under the Act or an exemption from
such registration is available; provided, however, the parties acknowledge and agree that the
Company has an obligation to register the Underlying Shares as provided in the Recapitalization
Agreement and Related Recapitalization Documents.
(c) The Holder is aware that neither the Warrant, the Exercise Shares nor the Underlying
Shares may be sold pursuant to Rule 144 adopted under the Act unless certain conditions are met,
including, among other things, the existence of a public market for the shares, the availability of
certain current public information about the Company, the resale following the required holding
period under Rule 144 and the number of shares being sold during any three month period not
exceeding specified limitations.
4.3 Disposition of Warrant, Exercise Shares and Underlying Shares.
The Holder understands and agrees that all certificates evidencing the shares to be issued to
the Holder may bear the following legend:
4.
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “ACT”). THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED
IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER THE
ACT OR UNLESS SUCH TRANSACTION IS IN COMPLIANCE WITH APPLICABLE FEDERAL AND STATE
SECURITIES LAWS.
4.4 Accredited Investor Status. The Holder is an “accredited investor” as defined in
Regulation D promulgated under the Act.
5. Adjustment of Exercise Price and Exercise Shares.
5.1 Changes in Securities. In the event of changes in the series of equity securities of the
Company comprising the Exercise Shares by reason of stock dividends, splits, recapitalizations,
reclassifications, combinations or exchanges of shares, separations, reorganizations, liquidations,
or the like, the number and class of Exercise Shares available under the Warrant in the aggregate
and the Exercise Price shall be correspondingly adjusted to give the Holder of the Warrant, on
exercise for the same aggregate Exercise Price, the total number, class, and kind of shares as the
Holder would have owned had the Warrant been exercised prior to the event and had the Holder
continued to hold such shares until after the event requiring adjustment. For purposes of this
Section 5, the “Aggregate Exercise Price” shall mean the aggregate Exercise Price payable in
connection with the exercise in full of this Warrant. The form of this Warrant need not be changed
because of any adjustment in the number of Exercise Shares subject to this Warrant.
5.2 Reserved.
5.3 Dilutive Issuances. Notwithstanding any other provision of this Warrant or other
documents, if at any time prior to exercise of this Warrant, the Company issues or sells or is
deemed to have issued or sold additional shares of Capital Stock (including, without limitation in
the event that the nominal or effective price of Capital Stock is amended after issuance),
for a nominal or effective price less than the then effective Exercise Price (a “Dilutive
Issuance”), then and in each such case, as of the opening of business on the date of such issue or
sale, the then existing Exercise Price shall be reduced to the price at which such shares are
issued or sold, or deemed to be issued or sold, and the number of Exercise Shares shall be
increased proportionately, so that after such adjustment the aggregate Exercise Price payable
hereunder for the increased number of Warrant Shares shall be the same as the aggregate Exercise
Price payable for the Warrant Shares immediately prior to such adjustment. For purposes of this
Section 5.3, the Company will be deemed to have issued or sold additional shares of Capital
5.
Stock if
it issues any security or instrument directly or indirectly convertible, exercisable or exchangeable for
Capital Stock, or if it promises, undertakes, commits, agrees or enters into any letter of intent
to do so (including by reducing the nominal or effective exercise price or nominal or effective
conversion price of a security directly or indirectly exercisable, convertible or exchangeable for Capital Stock).
Notwithstanding the foregoing, (i) no further adjustment of the Exercise Price shall be made as a
result of the actual issuance of shares of Capital Stock upon the conversion, exercise or exchange
of any such instrument or in satisfaction of any such undertaking, commitment, agreement or letter
of intent, and (ii) no adjustment of the Exercise Price shall be made as a result of the actual
issuance of any shares of Common Stock pursuant to either (X) the exercise of those certain options
to purchase up to 35,000 shares of Common Stock at a purchase price of $0.0001 per share that were
outstanding on April 26, 2004 and held by members of the Board of Directors of the Company; or (Y)
the issuance or exercise of Warrant No. PA1W-1.
5.4 Certificate of Adjustments. Upon each adjustment of the Exercise Price and/or Exercise
Shares, the Company shall promptly notify the Holder in writing and furnish the Holder with a
certificate of its Chief Financial Officer setting forth such adjustment and the facts upon which
such adjustment is based.
6. Fractional Shares. No fractional shares shall be issued upon the exercise of this
Warrant as a consequence of any adjustment pursuant hereto. All Exercise Shares (including
fractions) to be issued upon exercise of this Warrant shall be aggregated for purposes of
determining whether the exercise would result in the issuance of any fractional share. If, after
aggregation, the exercise would result in the issuance of a fractional share, the Company shall, in
lieu of issuance of any fractional share, pay the Holder otherwise entitled to such fraction a sum
in cash equal to the product resulting from multiplying the then current fair market value of one
Exercise Share by such fraction.
7. Transfer of Warrant. Subject to applicable laws, this Warrant and all rights
hereunder are transferable, in whole or in part, at any time or times by the Holder, upon delivery
of this Warrant and the form of assignment attached hereto to any transferee designated by Holder.
The transferee shall sign a customary investment letter in form and substance reasonably
satisfactory to the Company.
8. Lost, Stolen, Mutilated or Destroyed Warrant. If this Warrant is lost, stolen,
mutilated or destroyed, the Company may, on such terms as to indemnity or otherwise as it may
reasonably impose (which shall, in the case of a mutilated Warrant, include the surrender thereof),
issue a new Warrant of like denomination and tenor as the Warrant so lost, stolen, mutilated or
destroyed. Any such new Warrant shall constitute an original contractual obligation of the Company,
whether or not the allegedly lost, stolen, mutilated or destroyed Warrant shall be at any time
enforceable by anyone.
9. Amendment. Any term of this Warrant may be amended or waived only with the written
consent of the Company and the Holder.
10. Notices, etc. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given upon actual delivery to the recipient. All
communications shall be sent to the Company and to the Holder at the addresses listed on the
signature page
6.
hereof or at such other address as the Company or Holder may designate by ten (10) days
advance written notice to the other parties hereto.
11. Governing Law. This Warrant and all rights, obligations and liabilities hereunder
shall be governed by and construed under the laws of the State of Delaware as applied to agreements
among Delaware residents, made and to be performed entirely within the State of Delaware without
giving effect to conflicts of laws principles.
[Signature Page Follows]
7.
In Witness Whereof, the Company has caused this Warrant to be executed by its duly
authorized officer as of the date first written above.
| Northwest Biotherapeutics, Inc. | |||||||
| By: | |||||||
| Name: | |||||||
| Title: | |||||||
| Address: | 00000 000xx Xxxxxx, XX | ||||||
| Xxxxx 000 | |||||||
| Xxxxxxx, XX 00000 | |||||||
| Fax: (000) 000-0000 | |||||||
ACKNOWLEDGED AND AGREED:
Toucan Capital Fund II, L.P.
By: |
||
Name: |
||
Title: |
||
Address:
|
0000 Xxxxxxxxx Xxxxxx | |
| Xxxxx 000 | ||
| Xxxxxxxx, XX 00000 | ||
| Fax: (000) 000-0000 | ||
[Signature Page to Warrant No. A&R PW-1]
NOTICE OF EXERCISE
TO: Northwest Biotherapeutics, Inc.
(1) o
The undersigned hereby elects to purchase ___ shares of
___ (the
“Exercise Shares”) of Northwest Biotherapeutics, Inc. (the “Company”) pursuant to the
terms of the attached Warrant, and tenders herewith payment of the exercise price in full, together
with all applicable transfer taxes, if any.
o
The undersigned hereby elects to purchase ___ shares of
___ (the “Exercise
Shares”) of Northwest Biotherapeutics, Inc. (the “Company”) pursuant to the terms of the
net exercise provisions set forth in Section 2.1 of the attached Warrant, and shall tender payment
of all applicable transfer taxes, if any.
(2) Please issue a certificate or certificates representing said Exercise Shares in the name
of the undersigned or in such other name as is specified below:
(Name)
(Address)
(3) The undersigned represents that (i) the aforesaid Exercise Shares are being acquired for
the account of the undersigned for investment and not with a view to, or for resale in connection
with, the distribution thereof and that the undersigned has no present intention of distributing or
reselling such shares except in accordance with applicable federal and state securities laws; (ii)
the undersigned is aware of the Company’s business affairs and financial condition and has acquired
sufficient information about the Company to reach an informed and knowledgeable decision regarding
its investment in the Company; (iii) the undersigned is experienced in making investments of this
type and has such knowledge and background in financial and business matters that the undersigned
is capable of evaluating the merits and risks of this investment and protecting the undersigned’s
own interests; (iv) the undersigned understands that Exercise Shares issuable upon exercise of this
Warrant have not been registered under the Securities Act of 1933, as amended (the “Securities
Act”), by reason of a specific exemption from the registration provisions of the Securities Act,
which exemption depends upon, among other things, the bona fide nature of the investment intent as
expressed herein, and, because such securities have not been registered under the Securities Act,
they must be held indefinitely unless subsequently registered under the Securities Act or an
exemption from such registration is available; (v) the undersigned is aware that the aforesaid
Exercise Shares may not be sold pursuant to Rule 144 adopted under the Securities Act unless
certain conditions are met and until the undersigned has held the shares for the number of years
prescribed by Rule 144, that among the conditions for use of the Rule is the availability of
current information to the public about the Company; and (vi) the undersigned agrees not to make
any disposition of all or any part of the aforesaid shares of Exercise Shares unless and until
there is then in effect a registration statement under the Securities Act covering such proposed
disposition and such
1.
disposition is made in accordance with said registration statement or unless such transaction
is in compliance with applicable federal and state securities laws.
(Date)
|
(Signature) | |||
| (Print name) |
2.
ASSIGNMENT FORM
(To assign the foregoing Warrant, execute this form
and supply required information. Do not use this
form to purchase shares.)
and supply required information. Do not use this
form to purchase shares.)
For Value Received, the foregoing Warrant and all rights evidenced thereby are hereby
assigned to
Name: |
||
| (Please Print) | ||
Address: |
||
| (Please Print) | ||
| Dated: __________, 20__ | ||
Holder’s Signature: |
||
Holder’s Address: |
||
NOTE: The signature to this Assignment Form must correspond with the name as it appears on the face
of the Warrant, without alteration or enlargement or any change whatever. Officers of corporations
and those acting in a fiduciary or other representative capacity should file proper evidence of
authority to assign the foregoing Warrant.
3.
