Placement Agent's Warrant - Biopure Corp. and DP Securities Inc.
THIS WARRANT AND THE SHARES OF COMMON STOCK THAT ARE ISSUABLE UPON EXERCISE OF
THE WARRANT MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR OTHERWISE TRANSFERRED
UNLESS SUCH TRANSFER IS REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, AND APPLICABLE STATE SECURITIES LAWS OR UNLESS THE CORPORATION
RECEIVES AN OPINION OF COUNSEL OR OTHER EVIDENCE REASONABLY SATISFACTORY TO IT
TO THE EFFECT THAT SUCH REGISTRATION AND QUALIFICATION ARE NOT REQUIRED.
WARRANT TO PURCHASE 20,700 SHARES OF CLASS A COMMON STOCK
(INCLUDING ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS)
PLACEMENT AGENT'S WARRANT
Dated: May 9, 2002
This certifies that DP Securities, Inc. (herein sometimes called the
"Placement Agent") or its permitted transferee (the Placement Agent or any such
transferee is sometimes herein called the "Holder") is entitled to purchase from
BIOPURE CORPORATION, a Delaware corporation (the "Company"), at the price and
during the period as hereinafter specified, up to 20,700 shares, including
associated preferred stock purchase rights under that certain Rights Agreement
(the "Rights Agreement") dated as of as of September 24, 1999 between the
Company and American Stock Transfer & Trust Company, as Rights Agent (such
shares collectively with such associated rights, the "Shares") of Class A common
stock, $0.01 par value per share, of the Company (the "Common Stock") at a
purchase price of $7.67 per share (equal to the closing price of a Share, as
reported on The Nasdaq Stock Market on the Closing Date (as defined below)
subject to adjustment as described below (as so adjusted from time to time, the
"Exercise Price"), at any time during the three (3) year period commencing one
(1) year from the Closing Date. "Closing Date" means May 9, 2002.
This Placement Agent's Warrant (the "Placement Agent's Warrant") is
issued pursuant to an Engagement Letter, dated April 1, 2002, by and between the
Company and DP Securities, Inc., as Placement Agent, in connection with a public
offering, through the reasonable best efforts of the Placement Agent, of 690,000
Shares as therein described. Except as specifically otherwise provided herein,
the Shares issued pursuant to the Placement Agent's Warrant shall bear the same
terms and conditions as described under the caption "Description of Capital
Stock" in the prospectus supplement except that the Holder shall have
registration rights under the Securities Act of 1933, as amended (the "Act"),
for the Shares issuable pursuant the Placement Agent's Warrant as more fully
described in Section 6 herein.
1. The rights represented by the Placement Agent's Warrant shall be
exercisable at the Exercise Price, and during the periods as follows:
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(a) During the period from the Closing Date to and through
May 8, 2003 (the "First Anniversary Date"), inclusive, the Holder shall have no
right to purchase any Shares hereunder.
(b) At any time and from time to time between May 9, 2003 and
May 8, 2006, (the expiration of four (4) years from the Closing Date, i.e. the
"Expiration Date") inclusive, the Holder shall have the right to purchase Shares
hereunder at the Exercise Price.
(c) After the Expiration Date, the Holder shall have no right
to purchase all or any portion of the Shares hereunder.
2. (a) The rights represented by the Placement Agent's Warrant may be
exercised at any time within the periods above specified, in whole or in part,
by (i) the surrender of the Placement Agent's Warrant (with the purchase form at
the end hereof properly executed) at the principal executive office of the
Company (or such other office or agency of the Company as it may designate by
notice in writing to the Holder at the address of the Holder appearing on the
books of the Company); (ii) payment to the Company of the Exercise Price then in
effect for the number of Shares specified in the above-mentioned purchase form
together with applicable stock transfer taxes, if any; and (iii) delivery to the
Company of a duly executed agreement signed by the person(s) designated in the
purchase form to the effect that such person(s) agree(s) to be bound by the
provisions of Section 6 and subsections (b), (c) and (d) of Section 7 hereof.
The Placement Agent's Warrant shall be deemed to have been exercised, in whole
or in part to the extent specified, immediately prior to the close of business
on the date the Placement Agent's Warrant is surrendered and payment is made in
accordance with the foregoing provisions of this Section 2, and the person or
persons in whose name or names the certificates for the Shares shall be issuable
upon such exercise shall become the holder or holders of record of such Shares
at that time and date. The Shares and the certificates for the Shares so
purchased shall be delivered to the Holder within a reasonable time, not
exceeding ten (10) business days, after the rights represented by this Placement
Agent's Warrant shall have been so exercised.
(b) Notwithstanding anything to the contrary contained in
Section 2(a), the Holder may elect to exercise this Placement Agent's Warrant in
whole or in part on a "cashless exercise basis" by receiving Shares equal to the
value (as determined below) of this Placement Agent's Warrant, or any part
hereof, upon surrender of the Placement Agent's Warrant at the principal office
of the Company together with notice of such election in which event the Company
shall issue to the Holder a number of Shares computed using the following
formula:
X = Y(A-B)
--------
A
Where X = the number of Shares to be issued to the Holder;
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Y = the number of Shares issuable upon exercise
of this Placement Agent's Warrant;
A = the current fair market value of one share
of Common Stock (determined in the same
manner as the "current market price per
share of Common Stock" is to be determined
pursuant to Section 8(e) of this Placement
Agent's Warrant);
B = the Exercise Price.
3. (a) The Placement Agent's Warrant shall not be sold, transferred,
assigned, or hypothecated for a period of one year commencing on the Closing
Date except that it may be transferred to successors of the Holder.
(b) Any transfer of this Placement Agent's Warrant shall be
effected by the Holder by (i) executing the0 form of assignment at the end
hereof and (ii) surrendering the Placement Agent's Warrant for cancellation at
the office or agency of the Company referred to in Section 2 hereof, accompanied
by (x) a written instrument of transfer in form reasonably satisfactory by the
Company, duly executed by the registered Holder thereof or by the duly appointed
legal representative thereof or by a duly authorized attorney-in-fact, (y) a
certificate (signed by an officer of the Holder if the Holder is a corporation)
stating that each transferee is a permitted transferee under this Section 3; and
(z) an opinion of counsel, reasonably satisfactory in form and substance to the
Company, to the effect that this Placement Agent's Warrant or the Shares, as
applicable, may be sold or otherwise transferred without registration under the
Securities Act of 1933, as amended (the "Act"). Upon original issuance thereof,
and until such time as the same shall have been registered under the Act or sold
pursuant to Rule 144 promulgated thereunder (or any similar rule or regulation),
each certificate representing the Placement Agent's Warrant or any part thereof
shall bear the following legend, unless in the opinion of counsel to the Company
such legend is no longer required by the Securities Act:
THIS WARRANT AND THE SHARES OF COMMON STOCK THAT ARE ISSUABLE UPON
EXERCISE OF THE WARRANT MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
OTHERWISE TRANSFERRED UNLESS SUCH TRANSFER IS REGISTERED OR QUALIFIED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE
SECURITIES LAWS OR UNLESS THE CORPORATION RECEIVES AN OPINION OF
COUNSEL OR OTHER EVIDENCE REASONABLY SATISFACTORY TO IT TO THE EFFECT
THAT SUCH REGISTRATION AND QUALIFICATION ARE NOT REQUIRED.
Upon any transfer of this Placement Agent's Warrant or any part thereof in
accordance with the first sentence of this Section 3(b), the Company shall
issue, in the name or names specified by the Holder (including the Holder), a
new Placement Agent's Warrant or
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Warrants of like tenor and representing in the aggregate rights to purchase the
same number of Shares as are purchasable hereunder at such time.
(c) Any attempted transfer of this Placement Agent's Warrant
or any part thereof in violation of this Section 3 shall be null and void ab
initio.
4. The Company covenants and agrees that all Shares which may be
purchased hereunder will, upon issuance and delivery against payment therefor of
the requisite purchase price, be duly and validly issued, fully paid and
nonassessable. The Company further covenants and agrees that, during the periods
within which the Placement Agent's Warrant may be exercised, the Company will at
all times have authorized and reserved a sufficient number of shares of its
Common Stock to provide for the exercise of the Placement Agent's Warrant.
5. The Placement Agent's Warrant shall not entitle the Holder to any
voting rights or other rights, including without limitation notice of meetings
of other actions or receipt of dividends, as a stockholder of the Company.
6. (a) Except as provided in Section 6(b), the Company shall advise the
Holder or its permitted transferee, whether the Holder holds the Placement
Agent's Warrant or has exercised the Placement Agent's Warrant and holds Shares,
by written notice at least four weeks prior to the filing of any new
registration statement thereto under the Act, covering any equity securities of
the Company, for its own account or for the account of others, except for any
registration statement filed on Form S-4 or S-8 (or other comparable form), and
will, during the three (3) year period from the First Anniversary Date, upon the
request of the Holder, include in any such new registration statement (the
"Registration Statement") such information as may be required to permit a public
offering of, all or any of the Shares underlying the Placement Agent's Warrant
(the "Registrable Securities").
(b) At any time during the three (3) year period beginning on
the First Anniversary Date, a 50% Holder (as defined below) may request, on one
occasion, that the Company register under the Act any and all of the Registrable
Securities held by such 50% Holder, at the Company's expense (except as provided
below). Upon the receipt of any such notice, the Company will promptly, but no
later than four weeks after receipt of such notice, file a post-effective
amendment to any existing registration statement or a new registration statement
pursuant to the Act (such post-effective amendment or new registration
statement, a "Demand Registration Statement"), so that such designated
Registrable Securities may be publicly sold under the Act as promptly as
practicable thereafter and the Company shall, subject to Section 6(h), use
reasonable best efforts to cause such Demand Registration Statement to become
effective (including the taking of such reasonable steps as are necessary to
obtain the removal of any stop order) within 120 days after the receipt of such
notice, provided, that such 50% Holder shall furnish the Company with
appropriate information in connection therewith as the Company may reasonably
request in writing. The 50% Holder may, at its option, request the registration
of any of Registrable Securities in a registration statement made by the Company
as contemplated by Section 6(a) or in connection with a request made pursuant to
this
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Section 6(b), in either case prior to acquisition of the Shares issuable upon
exercise of the Placement Agent's Warrant. Subject to Section 6(h), within ten
days after receiving any such notice pursuant to this Section 6(b), the Company
shall give notice to any other Holders of the Placement Agent's Warrant,
advising that the Company is proceeding with such Demand Registration Statement
and offering to include therein, pursuant to Section 6(a), the Shares underlying
that part of the Placement Agent's Warrant held by the other Holders, provided
that they shall furnish the Company with such appropriate information (relating
to the intentions of such Holders) in connection therewith as the Company shall
reasonably request in writing.
(c) The term "50% Holder" as used in this Section 6 shall mean
one or more Holders of this Placement Agent's Warrant or the Shares underlying
this Placement Agent's Warrant that, together with one or more holders of the
Company's warrant issued April 23, 2002 (the "April 23 Warrant") or shares of
Common Stock issuable upon exercise of the April 23 Warrant, hold (assuming the
exercise in full of this Placement Agent's Warrant and the April 23 Warrant held
by such persons) a number of shares of Common Stock issued or issuable upon
exercise of this Placement Agent's Warrant or the April 23 Warrant that is at
least 50% of the sum of the number of Shares issuable upon exercise in full of
this Placement Agent's Warrant (as such number may be adjusted from time to time
pursuant to Section 8 of this Placement Agent's Warrant) and the number of
shares of Common Stock issuable upon exercise in full of the April 23 Warrant
(as such number may be adjusted from time to time pursuant to Section 8 of the
April 23 Warrant).
(d) For so long as the Registrable Securities included in any
Registration Statement or Demand Registration Statement remain unsold, but in
any event not longer than 270 days after the date of effectiveness of such
Registration Statement or Demand Registration Statement (plus the number of
days, if any, that such Registration Statement or Demand Registration Statement
has been suspended pursuant to the provisions of Section 6(h)), the Company
shall, subject to Section 6(h), (i) maintain the effectiveness of such
Registration Statement or Demand Registration Statement; (ii) timely file all
reports required under the Securities Exchange Act of 1934, as amended, and the
rules and regulations of the Securities and Exchange Commission (the
"Commission") thereunder; (iii) file such post-effective amendments to the
Registration Statement or Demand Registration Statement as may be necessary so
that the Registration Statement or Demand Registration Statement does not
contain any misstatement of a material fact or omit to state any material fact
required to make the statements therein not misleading; (iv) supply prospectuses
and such other documents as any Holder whose Registrable Securities are included
in such Registration Statement or Demand Registration Statement may reasonably
request in order to facilitate the public sale or other disposition of such
Registrable Securities; (v) use its reasonable best efforts to register and
qualify any of the Registrable Securities for sale in such jurisdictions within
the United States (x) as any such Holder designates and (y) with respect to
which the Company obtained a qualification in connection with its initial public
offering, provided that the nothing in this clause (v) shall require the Company
to qualify to do business as a foreign corporation or to file a general consent
to service of process in any jurisdiction in which it is not otherwise so
qualified or required to file such a consent at the time; and (vi) do any and
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all other acts and things which may be necessary or desirable to enable any such
Holder to consummate the public sale or other disposition of the Registrable
Securities included in the Registration Statement or Demand Registration
Statement, all at no expense to such Holder or the Placement Agent (except as
provided in the immediately following sentence). All costs and expenses in
connection with any Registration Statement or Demand Registration Statement
shall be borne by the Company, except that the Holder(s) shall bear the fees of
their own counsel and any other advisors retained by them and any underwriting
discounts or sales or other commissions applicable to any of the Registrable
Securities sold by them. In connection with any Registration Statement or Demand
Registration Statement, the Company shall furnish indemnification in the manner
provided in Section 7 hereof, and each Holder whose Registrable Securities are
included therein shall furnish information and indemnification in the manner
provided in Section 7. Subject to Section 6(g), the Company shall have the right
to include additional shares of Common Stock to be issued and sold by the
Company in any Demand Registration Statement.
(e) Notwithstanding the foregoing set forth in this Section 6,
the Company shall not be required to include in any Registration Statement or
any Demand Registration Statement any Registrable Securities which in the
opinion of counsel to the Company (which opinion is reasonably acceptable to
counsel to the Placement Agent) would be saleable immediately without
restriction or limitation under Rule 144 (or its successor) if the Placement
Agent's Warrant was exercised pursuant to Section 2(b) herein.
(f) If any registration pursuant to this Section 6 is in the
form of an underwritten offering, the Company will select and obtain the
investment banker or investment bankers and manager or managers that will
administer the offering. The Company shall (together with each Holder whose
Registrable Securities are included in such offering) enter into an underwriting
agreement in customary form with the managing underwriter selected for such
underwriting. If any Holder disapproves of the terms of the underwriting, it may
elect to withdraw therefrom by written notice to the Company and the managing
underwriter, and upon such withdrawal the original request of such Holder to
cause Registrable Securities to be registered shall not be deemed to constitute
a request for registration pursuant to Section 6(b), provided that the
withdrawal of one or more Holders shall not affect the determination of whether
any request made pursuant to Section 6(b) was made by a 50% Holder, and provided
further that if all Holders who have requested inclusion of their shares in a
Demand Registration pursuant to Section 6(b) withdraw their Registrable
Securities, then, notwithstanding anything to the contrary in this Placement
Agent's Warrant, any Holders who request registration of Registrable Securities
pursuant to Section 6(b) in the future shall be responsible for and pay all
expenses incurred by the Company in connection with such future registration..
(g) (i) In the event that any registration pursuant to Section
6(a) shall be in connection with an underwritten offering, and the managing
underwriter determines in good faith and advises in writing that the number of
Registrable Securities to be included in such offering, together with the number
of shares of Common Stock to be included in the Registration Statement by the
Company or other holders of the Company's securities
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with the right to request inclusion in the Registration Statement, if any,
exceeds the number of shares of Common Stock that it is advisable to offer and
sell at such time or would interfere with the successful marketing of the Common
Stock covered by the Registration Statement, then priority for including shares
of Common Stock in the Registration Statement, up to the number advised by the
managing underwriter, shall be allocated first, to the Company and each other
person who has requested inclusion of shares of Common Stock pursuant to a
"demand" registration right, pro rata in proportion to the respective number of
shares of Common Stock to be included by them, and second, to the extent of any
remaining capacity as advised by the managing underwriter, to the Holders
requesting registration of their Registrable Securities and each other person
who has requested inclusion of shares of Common Stock pursuant to a "piggyback"
registration right, pro rata in proportion to the respective number of shares of
Common Stock (including Registrable Securities) to be included by them. (ii) In
the event that any registration pursuant to Section 6(b) shall be in connection
with an underwritten offering, and the managing underwriter determines in good
faith and advises in writing that the number of Registrable Securities to be
included in such offering, together with the number of shares of Common Stock to
be included in the Demand Registration Statement by the Company or other holders
of the Company's securities with the right to request inclusion in the Demand
Registration Statement, if any, exceeds the number of shares of Common Stock
that it is advisable to offer and sell at such time or would interfere with the
successful marketing of the Common Stock covered by the Demand Registration
Statement, then priority for including shares of Common Stock in the Demand
Registration Statement, up to the number advised by the managing underwriter,
shall be allocated first, to the 50% Holder and each other person who has
requested inclusion of shares of Common Stock pursuant to a "demand"
registration right, pro rata in proportion to the respective number of shares of
Common Stock to be included by them, and second, to the extent of any remaining
capacity as advised by the managing underwriter, to the Company and each other
person (including any Holder who is not a 50% Holder and who requests inclusion
of Registrable Securities in the Demand Registration Statement pursuant to
Section 6(a)) who has requested inclusion of shares of Common Stock pursuant to
a "piggyback" registration right, pro rata in proportion to the respective
number of shares of Common Stock (including Registrable Securities) to be
included by them.
(h) In any registration initiated by the Company or by any
person having "demand" registration rights (other than a 50% Holder exercising
such rights pursuant to Section 6(b)) in which Holders request inclusion of
their Registrable Securities pursuant to Section 6(a), if at any time after
giving notice of its intention to register securities and prior to the effective
date of the Registration Statement the Company or such other person shall
determine for any reason not to register or to delay registration of it
securities, the Company may, at its election, give written notice of such
determination to each Holder that has requested inclusion of Registrable
Securities in the Registration Statement and (x) in the case of a determination
not to register, shall be relieved of its obligation to register any Registrable
Securities in connection with such registration and (y) in the case of a
determination to delay registering, shall be permitted to delay registering any
Registrable Securities for the same period as the delay in registering such
other securities. If (i) at any time when a prospectus relating to Registrable
Securities is required to be
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delivered under the Act, the Company discovers that, or any event occurs as a
result of which, the prospectus (including any supplement thereto) included in
any Registration Statement or Demand Registration Statement, as then in effect,
includes an untrue statement of a material fact or omits to state any material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading, or
(ii) the Commission issues any stop order suspending the effectiveness of any
Registration Statement or proceedings are initiated or threatened for that
purpose, then the Company shall promptly deliver a written notice to such effect
to each Holder whose Registrable Securities are included in such Registration
Statement or Demand Registration Statement, and each such Holder shall
immediately upon receipt of such notice discontinue its disposition of
Registrable Securities pursuant to such Registration Statement or Demand
Registration Statement until its receipt of the copies of the supplemented or
amended prospectus contemplated by the immediately following sentence and, if so
directed by the Company, shall deliver to the Company (at the Company's expense)
all copies, other than permanent file copies, then in such Holder's possession
of the prospectus or prospectus supplement relating to such Registrable
Securities current at the time of receipt of such notice. As promptly as
practicable following the event or discovery referred to in clause (i) of the
immediately preceding sentence, the Company shall prepare and furnish to the
Holders whose Registrable Securities are included in such Registration Statement
or Demand Registration Statement a reasonable number of copies of an amendment
or supplement of such prospectus so that, as thereafter delivered to purchasers
of such Registrable Securities, such prospectus shall not include an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading. Notwithstanding
anything to the contrary in this Section 6 if the filing or maintenance of any
Registration Statement or Demand Registration Statement would require the
Company to make a disclosure that would, in the reasonable judgment of the
Company's Board of Directors, have a material adverse effect on the business,
operations, properties, prospects or financial condition of the Company or on
pending or imminent transactions, the Company shall have the right, exercisable
for a period not to exceed in the aggregate 45 consecutive calendar days in any
period of twelve consecutive months (the "Blackout Period") upon written notice
to the Holders, to delay the filing of any Registration Statement or Demand
Registration Statement or of any amendment thereto, to suspend its obligation to
maintain the effectiveness of any Registration Statement or Demand Registration
Statement and to suspend the use of any prospectus or prospectus supplement in
connection with any Registration Statement or Demand Registration Statement.
Each Holder agrees that upon receipt of any such notice from the Company, it
shall immediately cease all efforts to dispose of Registrable Securities
pursuant to such Registration Statement or Demand Registration Statement until
such time as the Company shall notify it of the end of such restrictions or, if
earlier, the expiration of the Blackout Period.
7. (a) Whenever pursuant to Section 6 a Registration Statement or
Demand Registration Statement relating to any Shares issued upon exercise of the
Placement Agent's Warrant is filed under the Act, amended or supplemented, the
Company will indemnify and hold harmless each Holder of the securities covered
by such Registration
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Statement or Demand Registration Statement, amendment or supplement (such Holder
being hereinafter called the "Distributing Holder"), and each person, if any,
who controls (within the meaning of the Act) the Distributing Holder, and each
underwriter (within the meaning of the Act) of such securities and each person,
if any, who controls (within the meaning of the Act) any such underwriter,
against any losses, claims, damages or liabilities, joint or several, to which
the Distributing Holder, any such controlling person or any such underwriter may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities, or actions in respect thereof, arise out of or are based
upon any untrue statement or alleged untrue statement of any material fact
contained in any such Registration Statement or Demand Registration Statement as
declared effective or any final prospectus constituting a part thereof or any
amendment or supplement thereto, or arise out of or are based upon the omission
or the alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading and will
reimburse the Distributing Holder or such controlling person or underwriter for
any legal or other expense reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that the Company will not be liable in any such case to the
extent that any such loss, claim, damage or liability arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission made in said Registration Statement or Demand Registration Statement,
said preliminary prospectus, said final prospectus or said amendment or
supplement in reliance upon and in conformity with written information furnished
by such Distributing Holder or any other Distributing Holder for use in the
preparation thereof and provided further, that the indemnity agreement provided
in this Section 7(a) with respect to any preliminary prospectus shall not inure
to the benefit of any Distributing Holder, controlling person of such
Distributing Holder, underwriter or controlling person of such underwriter from
whom the person asserting any losses, claims, charges, liabilities or litigation
based upon any untrue statement or alleged untrue statement of a material fact
or omission or alleged omission to state therein a material fact, received such
preliminary prospectus, if a copy of the prospectus in which such untrue
statement or alleged untrue statement or omission or alleged omission was
corrected has not been sent or given to such person within the time required by
the Act and the rules and regulations of the Commission thereunder.
(b) The Distributing Holder will indemnify and hold harmless
the Company, each of its directors, each of its officers who have signed said
Registration Statement or Demand Registration Statement and such amendments and
supplements thereto, and each person, if any, who controls the Company (within
the meaning of the Act) against any losses, claims, damages or liabilities,
joint or several, to which the Company or any such director, officer or
controlling person may become subject, under the Act or otherwise, insofar as
such losses, claims, damages or liabilities, or actions in respect thereof,
arise out of or are based upon any untrue or alleged untrue statement of any
material fact contained in said Registration Statement or Demand Registration
Statement, said preliminary prospectus, said final prospectus, or said amendment
or supplement, or arise out of or are based upon the omission or the alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged
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untrue statement or omission or alleged omission made in said Registration
Statement or Demand Registration Statement, said preliminary prospectus, said
final prospectus or said amendment or supplement in reliance upon and in
conformity with written information furnished by such Distributing Holder for
use in the preparation thereof; and will reimburse the Company or any such
director, officer or controlling person for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action.
(c) Promptly after receipt by an indemnified party under this
Section 7 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against an indemnifying party
under this Section 7, notify the indemnifying party in writing of the
commencement thereof, but the omission so to notify the indemnifying party will
not relieve it from any liability which it may have to any indemnified party for
indemnity or contribution to the extent it is not prejudiced as a proximate
result of such failure. In case any such action is brought against any
indemnified party, and such indemnified party seeks or intends to seek indemnity
from an indemnifying party, the indemnifying party will be entitled to
participate in, and, to the extent that it shall elect, jointly with any other
indemnifying party similarly notified, by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party; provided, however, if the defendants in
any such action include both the indemnified party and the indemnifying party
and the indemnified party shall have reasonably concluded that a conflict may
arise between the positions of the indemnifying party and the indemnified party
in conducting the defense of any such action or that there may be legal defenses
available to it and/or other indemnified parties which are different from or
additional to those available to the indemnifying party, the indemnified party
or parties shall have the right to select separate counsel to assume such legal
defenses and to otherwise participate in the defense of such action on behalf of
such indemnified party or parties. Upon receipt of notice from the indemnifying
party to such indemnified party of such indemnifying party's election so to
assume the defense of such action and approval by the indemnified party of
counsel (which approval shall not be unreasonably withheld or delayed), the
indemnifying party will not be liable to such indemnified party under this
Section 7 for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof unless: (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the next preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
separate counsel (together with local counsel), representing the indemnified
parties who are parties to such action); (ii) the indemnifying party shall not
have employed counsel satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of commencement of the
action; or (iii) the indemnifying party has authorized the employment of counsel
for the indemnified party satisfactory to the indemnified party at the expense
of the indemnifying party, in each of which cases the fees and expenses of
counsel shall be at the expense of the indemnifying party.
(d) The indemnifying party under this Section 7 shall not be
liable for any settlement of any proceeding effected without its written
consent, which consent shall not
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be unreasonably withheld or delayed, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party against any loss, claim, damage, liability or
expense by reason of such settlement or judgment. No indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement, compromise or consent to the entry of judgment in any pending or
threatened action, suit or proceeding in respect of which any indemnified party
is or could have been a party and indemnity was or could have been sought
hereunder by such indemnified party, unless such settlement, compromise or
consent includes: (i) an unconditional release of such indemnified party from
all liability on claims that are the subject matter of such action, suit or
proceeding; and (ii) does not include a statement as to or an admission of
fault, culpability or a failure to act by or on behalf of any indemnified party.
(e) Any losses, claims, damages, liabilities or expenses for
which an indemnified party is entitled to indemnification or contribution under
this Section 7 shall be paid by the indemnifying party to the indemnified party
as such losses, claims, damages, liabilities or expenses are incurred, but in
all cases, no later than forty-five (45) days after invoice to the indemnifying
party.
(f) If the indemnification provided for in this Section 7 is
unavailable to or insufficient to hold harmless an indemnified party under
Section 7(a) or 7(b) above in respect of any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) then each
indemnifying party shall contribute to the aggregate amount paid or payable by
such indemnified party in such proportion as is appropriate to reflect the
relative fault of such indemnifying party on the one hand and the Distributing
Holder on the other in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof), as well as any other relevant equitable
considerations. The relative fault shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company or the "control" stockholders on the one
hand or the Distributing Holder on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Company and each Distributing Holder agree that it would not be
just and equitable if contributions pursuant to this Section 7(f) were
determined by pro rata allocation or by any other method of allocation which
does not take account of the equitable considerations referred to above in this
Section 7(f). The amount paid or payable by an indemnified party as a result of
the losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) referred to above in this Section 7(f) shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7(f): (i) each Distributing
Holder shall not be required to contribute any amount in excess of the amount of
proceeds received by such Holder from sale(s) of such Holder's Shares pursuant
to the Registration Statement or Demand Registration Statement; and (ii) no
person guilty of fraudulent
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misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation.
8. The Exercise Price in effect at the time and the number and kind of
securities purchasable upon the exercise of the Warrant shall be subject to
adjustment from time to time upon the happening of certain events as follows:
(a) In case the Company shall (i) declare a dividend or make a
distribution on its outstanding shares of Common Stock in shares of Common
Stock, (ii) subdivide or reclassify its outstanding shares of Common Stock into
a greater number of shares, (iii) combine or reclassify its outstanding shares
of Common Stock into a smaller number of shares, or (iv) enter into any
transaction whereby the outstanding shares of Common Stock of the Company are at
any time changed into or exchanged for a different number or kind of shares or
other security of the Company or of another corporation through reorganization,
merger, consolidation, liquidation or recapitalization, then appropriate
adjustments in the number of Shares (or other securities for which such Shares
have previously been exchanged or converted) subject to this Placement Agent's
Warrant shall be made and the Exercise Price in effect at the time of the record
date for such dividend or distribution or of the effective date of such
subdivision, combination, reclassification, reorganization, merger,
consolidation, liquidation or recapitalization shall be proportionately adjusted
so that the Holder of this Placement Agent's Warrant exercised after such date
shall be entitled to receive the aggregate number and kind of shares of Common
Stock which, if this Placement Agent's Warrant had been exercised by such Holder
immediately prior to such date, the Holder would have been entitled to receive
upon such dividend, distribution, subdivision, combination, reclassification,
reorganization, merger, consolidation, liquidation or recapitalization. For
example, if the Company declares a 2 for 1 stock distribution and the Exercise
Price hereof immediately prior to such event was $9.80 per Share and the number
of Shares issuable upon exercise of this Placement Agent's Warrant was 6,000,
the adjusted Exercise Price immediately after such event would be $4.90 per
Share and the adjusted number of Shares issuable upon exercise of this Placement
Agent's Warrant would be 12,000. Such adjustment shall be made successively
whenever any event listed above shall occur.
(b) In case the Company shall fix a record date for the
issuance of rights or warrants to all holders of its Common Stock entitling them
to subscribe for or purchase shares of Common Stock (or securities convertible
into Common Stock) at a price (the "Subscription Price") (or having a conversion
price per share) less than the current market price per share of Common Stock
basis as determined pursuant to Section 8(e) on such record date, the Exercise
Price shall be adjusted so that the same shall equal the price determined by
multiplying the same by a fraction, the numerator of which shall be the sum of
the number of shares of Common Stock outstanding on the record date mentioned
below and the number of additional shares of Common Stock which the aggregate
offering price of the total number of shares of Common Stock so offered (or the
aggregate conversion price of the convertible securities so offered) would
purchase at the current market price per share of Common Stock on such record
date, and the denominator of which shall be the sum of the number of shares of
Common Stock outstanding on the record date mentioned below and the number of
additional shares of
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Common Stock offered for subscription or purchase (or into which the convertible
securities so offered are convertible). Such adjustment shall be made
successively whenever such rights or warrants are issued and shall become
effective immediately after the record date for the determination of
stockholders entitled to receive such rights or warrants; and to the extent that
shares of Common Stock are not delivered (or securities convertible into Common
Stock are not delivered) after the expiration of such rights or warrants the
Exercise Price shall be readjusted to the Exercise Price which would then be in
effect had the adjustments made upon the issuance of such rights or warrants
been made upon the basis of delivery of only the number of shares of Common
Stock (or securities convertible into Common Stock) actually delivered. This
Section 8(b) shall not apply to the occurrence of a "Distribution Date" under
the Rights Agreement.
(c) In case the Company shall hereafter distribute to all
holders of its Common Stock evidences of its indebtedness or assets (excluding
cash dividends or distributions and dividends or distributions referred to in
Section 8(a) above) or subscription rights or warrants (excluding those referred
to in Section 8(b) above), then in each such case the Exercise Price shall be
adjusted by multiplying the same, by a fraction, the numerator of which shall be
the total number of shares of Common Stock then outstanding multiplied by the
current market price per share of Common Stock (as defined in Section 8(e)
below), less the fair market value (as determined by the Company's Board of
Directors) of said assets, or evidences of indebtedness so distributed or of
such rights or warrants, and the denominator of which shall be the total number
of shares of Common Stock outstanding multiplied by such current market price
per share of Common Stock. Such adjustment shall be made whenever any such
distribution is made and shall become effective immediately after the record
date for the determination of stockholders entitled to receive such distribution
and to the extent that any subscription rights or warrants are not exercised
before the expiration of such rights or warrants the Exercise Price shall be
readjusted to the Exercise Price which would then be in effect had the
adjustments made upon the issuance of such rights or warrants been made upon the
basis of delivery of only the number of rights or warrants actually exercised.
This Section 8(c) shall not apply to the occurrence of a "Distribution Date"
under the Rights Agreement.
(d) Whenever the Exercise Price payable upon exercise of the
Placement Agent's Warrant is adjusted pursuant to Sections (a), (b) or (c)
above, the number of Shares purchasable upon exercise of this Placement Agent's
Warrant shall simultaneously be adjusted by multiplying the number of Shares
issuable upon exercise of this Placement Agent's Warrant by the Exercise Price
in effect immediately prior to such adjustment and dividing the product so
obtained by the Exercise Price, as adjusted.
(e) For the purpose of any computation under Subsection (c)
above, the current market price per share of Common Stock at any date shall be
deemed to be the closing price on the Trading Day immediately preceding the date
as of which the current market price is being determined, provided that if the
Common Stock is not then listed on any market or exchange, then the current
market price shall be the average of the closing bid prices for the Common Stock
on the OTC Bulletin Board, or, if such is not available,
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the Pink Sheets LLC (formerly the National Quotation Bureau), or otherwise the
average of the closing bid prices for the Common Stock quoted by two
market-makers of the Common Stock, or otherwise such Market Price shall be the
fair market value of one share of Common Stock as reasonably determined in good
faith by the Corporation and the Holders. "Trading Day" shall mean any day on
which the principal United States securities exchange or trading market on which
the Common Stock is listed or traded (the "Principal Market") as reported by
Bloomberg Financial Markets ("Bloomberg's") is open for trading. "Closing price"
shall mean the last sale price for the Common Stock on the Principal Market on
any particular Trading Day.
(f) No adjustment in the Exercise Price shall be required
unless such adjustment would require an increase or decrease of at least five
cents ($0.05) in such price; provided, however, that any adjustments which may
by reason of this Section 8(f) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment required to be made
hereunder. All calculations under this Section 8 shall be made to the nearest
cent or to the nearest one-hundredth of a share, as the case may be. Anything in
this Section 8 to the contrary notwithstanding, the Company shall be entitled,
but shall not be required, to make such changes in the Exercise Price, in
addition to those required by this Section 8, as it shall determine, in its sole
discretion, to be advisable in order that any dividend or distribution in shares
of Common Stock, or any subdivision, reclassification or combination of Common
Stock, hereafter made by the Company shall not result in any Federal income tax
liability to the holders of the Common Stock or securities convertible into
Common Stock.
(g) Whenever the Exercise Price is adjusted, as herein
provided, the Company shall promptly cause a notice setting forth the adjusted
Exercise Price and adjusted number of Shares issuable upon exercise of the
Placement Agent's Warrant to be mailed to the Holder, at its address set forth
herein, and shall cause a certified copy thereof to be mailed to the Company's
transfer agent, if any. The Company may retain a firm of independent certified
public accountants selected by the Board of Directors (who may be the regular
accountants employed by the Company) to make any computation required by this
Section 8, and a certificate signed by such firm shall be conclusive evidence of
the correctness of such adjustment.
(h) In the event that at any time, as a result of an
adjustment made pursuant to the provisions of this Section 8, the Holder of the
Placement Agent's Warrant thereafter shall become entitled to receive any shares
of the Company other than Common Stock, thereafter the number of such other
shares so receivable upon exercise of the Placement Agent's Warrant shall be
subject to adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to the Common Stock
contained in Sections 8(a) to (f), inclusive, above.
9. This Agreement shall be governed by and in accordance with the laws
of the State of Delaware without regard to conflicts of laws principles thereof.
10. In case of any consolidation of the Company with, or merger of the
Company into, any other entity, or in case of any sale or conveyance of all or
substantially all of the
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assets of the Company other than in connection with a plan of complete
liquidation of the Company at any time prior to the Expiration Date, then as a
condition of such consolidation, merger or sale or conveyance, the Company shall
give written notice of consolidation, merger, sale or conveyance to the Holder
and, from and after the effective date of such consolidation, merger, sale or
conveyance the Placement Agent's Warrant shall represent only the right to
receive the consideration that would have been issuable in respect of the Shares
underlying the Placement Agent's Warrant in such consolidation, merger, sale or
conveyance had the Placement Agent's Warrant been exercised in full immediately
prior to such effective time and the Holder shall have no further rights under
this Placement Agent's Warrant other than the right to receive such
consideration.
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[Signature Page Follows]
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IN WITNESS WHEREOF, the Company has caused this Placement Agent's
Warrant to be signed by its duly authorized officers under its corporate seal,
and this Placement Agent's Warrant to be dated April 9, 2002.
BIOPURE CORPORATION
By: ________________________________
__________________________
Chief Financial Officer
Attest:
________________________________
_____________________
Secretary
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PURCHASE FORM
(To be signed only upon exercise of Warrant)
The undersigned, the holder of the foregoing Placement Agent's Warrant,
hereby irrevocably elects to exercise the purchase rights represented by such
Warrant for, and to purchase thereunder, _______________ Shares of Common Stock,
$0.01 par value per share (the "Shares"), of BIOPURE CORPORATION and either
tenders herewith payment of the aggregate Exercise Price in respect
of the Shares in full, in the amount of $_________; or
elects pursuant to Section 2(b) of such Warrant to convert
such Warrant into Common Stock on a cashless exercise basis;
and
requests that the certificates for the Shares issued in the name(s) of, and
delivered to _________________, whose address(es) is (are):
Dated: _______________, ____
By:________________________________
___________________________________
___________________________________
Address
<PAGE>
TRANSFER FORM
(To be signed only upon transfer of Placement Agent's Warrant)
For value received, the undersigned hereby sells, assigns, and
transfers unto ______________________________ the right to purchase Shares
represented by the foregoing Placement Agent's Warrant to the extent of
__________ Shares, and appoints _________________________ attorney to transfer
such rights on the books of Biopure Corporation, with full power of substitution
in the premises. The undersigned believes that each transferee is a permitted
transferee under Section 3 of the Placement Agent's Warrant.
Dated: _______________, ____
By:________________________________
___________________________________
___________________________________
Address
In the presence of:
_____________________________