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221515.002 (B&F)
As filed with the Securities and Exchange Commission on April __, 1996
Registration No.
333-2730
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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
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AMENDMENT No. 1
To
Form S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
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BOSTON LIFE SCIENCES, INC.
(Exact name of registrant as specified in charter)
Delaware 87-0277826
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
1601 Trapelo Road
Waltham, Massachusetts 02154
(617) 890-8263
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
S. David Hillson
President and Chief Executive Officer
Boston Life Sciences, Inc.
1601 Trapelo Road
Waltham, Massachusetts 02154
(617) 890-8263
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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Copies to:
Raymond D. Agran, Esq.
Gerald J. Guarcini, Esq.
Ballard Spahr Andrews & Ingersoll
1735 Market Street, 51st Floor
Philadelphia, PA 19103
(215) 665-8500
Approximate date of commencement of proposed sale to the public: As soon as
practicable after this Registration Statement is declared effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [_]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
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The registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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SUBJECT TO COMPLETION, DATED MAY __, 1996
PROSPECTUS
48,072,758 Shares
Boston Life Sciences, Inc.
Common Stock and Warrants
--------------------
The securities offered hereby consist of (i) 48,072,758 shares of common
stock, $.01 par value per share (the "Common Stock"), and (ii) 5,997,782
warrants (the "Warrants"), each of which entitles the holder thereof to
purchase one share of Common Stock of Boston Life Sciences, Inc., a
Delaware corporation ("BLSI" or the "Company"), which are owned by the
selling stockholders listed herein under "Selling Stockholders"
(collectively, the "Selling Stockholders") (the Common Stock and Warrants
offered hereby are collectively referred to as the "Shares"). The Shares
may be offered from time to time by the Selling Stockholders. All expenses
of registration incurred in connection herewith are being borne by the
Company, but all selling and other expenses incurred by a Selling
Stockholder will be borne by that Selling Stockholder. The Company will
not receive any of the proceeds from the sale of the Shares by the Selling
Stockholders.
The Selling Stockholders have not advised the Company of any specific plans
for the distribution of the Shares covered by this Prospectus, but it is
anticipated that the Shares will be sold from time to time primarily in
transactions (which may include block transactions) on the Nasdaq SmallCap
Market of The Nasdaq Stock Market, Inc. (the "Nasdaq SmallCap Market") at
the market price then prevailing, although sales may also be made in
negotiated transactions or otherwise. The Selling Stockholders and the
brokers and dealers through whom sale of the Shares may be made may be
deemed to be "underwriters" within the meaning of the Securities Act of
1933, as amended (the "Securities Act"), and their commissions or discounts
and other compensation may be regarded as underwriters' compensation. See
"Plan of Distribution."
The Company's Common Stock is traded on the Nasdaq SmallCap Market under
the symbol "BLSI." On May __, 1996, the last reported closing price of the
Common Stock was $__________ per share.
--------------------
An investment in the Common Stock and Warrants offered hereby involves a
high degree of risk. See "Risk Factors" beginning on page 5 of this
Prospectus.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
--------------------
The date of this Prospectus is May __, 1996.
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No dealer, salesman or other person has been authorized to give any
information or to make any representation not contained in or incorporated
by reference in this Prospectus and, if given or made, such information or
representation must not be relied upon as having been authorized by the
Company, the Selling Shareholders or any other person. This Prospectus
does not constitute an offer to sell or a solicitation of an offer to buy
any of the securities offered hereby in any jurisdiction to any person to
whom it is unlawful to make such an offer in such jurisdiction. Neither
the delivery of this Prospectus nor any sale made hereunder shall, under
any circumstances, create any implication that the information herein is
correct as of any time subsequent to the date hereof or that there has been
no change in the affairs of the Company since that date.
AVAILABLE INFORMATION
This Prospectus, which constitutes a part of a Registration Statement on
Form S-3 (the "Registration Statement") filed by the Company with the
Securities and Exchange Commission (the "Commission") under the Securities
Act, omits certain of the information set forth in the Registration
Statement. Reference is hereby made to the Registration Statement and to
the exhibits thereto for further information with respect to the Company
and the securities offered hereby. Copies of the Registration Statement
and the exhibits thereto are on file at the offices of the Commission and
may be obtained upon payment of the prescribed fee or may be examined
without charge at the public reference facilities of the Commission
described below.
Statements contained herein concerning the provisions of documents are
necessarily summaries of such documents, and each statement is qualified in
its entirety by reference to the copy of the applicable document filed with
the Commission.
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, accordingly,
files reports, proxy statements and other information with the Commission.
Such reports, proxy statements and other information can be inspected and
copied at the public reference facilities maintained by the commission at
Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549,
and at the Commission's Regional Offices located at Seven World Trade
Center, New York, New York 10048 and Northwestern Atrium Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such
documents may also be obtained from the Public Reference Section of the
Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C.
20549, at prescribed rates. In addition, reports and proxy statements
concerning the Company can be inspected at the offices of the National
Association of Securities Dealers, Inc., 1735 K Street, N.W., Washington,
D.C. 20006.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents or portions of documents filed by the Company (File
No. 0-6533) with the Commission are incorporated hereby by reference:
(a) Annual Report on Form 10-K for the fiscal year ended December
31, 1995.
(b) Annual Report on Form 10-K, as amended by Form 10-K/A, for the
fiscal year ended December 3, 1994.
(c) Current Report on Form 8-K filed February 23, 1996.
(d) Current Report on Form 8-K filed March 7, 1996.
(e) The description of the Company's Common Stock which is
contained in the Company's Registration Statement on Form 8-A filed under
the Exchange Act, including any amendment or reports filed for the purpose
of updating such description.
All reports and other documents subsequently filed by the Company pursuant
to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, prior to the
filing of a post-effective amendment which indicates that all securities
offered hereby have been sold or which deregisters all securities remaining
unsold, shall be deemed to be incorporated by reference in this Prospectus
and to be a part hereof from the date of the filing of such reports or
documents. Any statement
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contained in a document, all or a portion of which is incorporated by
reference herein, shall be deemed to be modified or superseded for purposes
of this Prospectus to the extent that a statement contained or incorporated
by reference herein modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Prospectus.
Upon request, the Company will provide without charge to each person to
whom this Prospectus is delivered a copy of any or all of such documents
which are incorporated herein by reference (other than exhibits to such
documents unless such exhibits are specifically incorporated by reference
into the documents that this Prospectus incorporates). Written or oral
requests for copies should be directed to Marc E. Lanser, M.D., Executive
Vice President and Chief Scientific Officer, 1601 Trapelo Road, Waltham,
Massachusetts 02154, telephone number (617) 890-8263.
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THE COMPANY
Boston Life Sciences, Inc. ("BLSI" or the "Company") is the result of a
merger (the "Merger") between BLSI and Greenwich Pharmaceuticals, Inc.
("Greenwich"). The Merger took place on June 15, 1995 and resulted in a
publicly traded company managed by the Board of Directors and management of
Boston Life Sciences, Inc. ("Old BLSI"), the company existing prior to the
merger.
BLSI is a development stage biotechnology company engaged in the research
and development of novel therapeutic and diagnostic products to treat
chronic debilitating diseases, such as cancer, Parkinson's Disease, central
nervous system (CNS) disorders and autoimmune diseases. With the exception
of the technologies originating with Greenwich, all of BLSI's technologies
currently under development were invented or discovered by researchers
working at Harvard University and/or its affiliated hospitals ("Harvard and
its Affiliates"). In addition, as a result of the merger, BLSI in the case
of THERAFECTIN(R) amiprilose HC1 ("THERAFECTIN"), expects to commence a
Phase III trial in the second quarter of 1996.
Corporate Strategy
The Company intends to (i) fund the early development of its compounds in
preclinical development and (ii) enter into corporate partnering
arrangements with established pharmaceutical or biotechnology companies to
support the continued development of BLSI's compounds and potential
marketing of any products following government approvals. Additionally,
BLSI does not currently own any laboratory or manufacturing facilities and
intends to contract out such services.
With the addition of Greenwich's carbohydrate technologies acquired in the
Merger, BLSI will also be formulating a strategy to address the potential
future requirements of THERAFECTIN with the ultimate objective of obtaining
U.S. Food and Drug Administration (FDA) approval. See "Recent
Developments." There can be no assurances, however, that the
implementation of any strategy would ultimately result in the approval of
THERAFECTIN by FDA.
Strategic Alliances
In June 1995, BLSI entered into a research and development collaboration
agreement with Zeneca Pharmaceuticals, Ltd. ("Zeneca") for all indications,
on a worldwide basis, of BLSI's MHC Class II Inhibition technology. The
collaboration calls for Zeneca to fund approximately the first two years of
research and for BLSI to receive payments from Zeneca as lead compounds
reach traditional clinical development milestones. In addition, BLSI will
receive royalties payable on the sale of any products originating from the
collaboration.
BLSI is also a party to two collaborations for THERAFECTIN with different
pharmaceutical companies for various geographic regions in the world.
Those development and license agreements are with (i) Kissei Pharmaceutical
Co., Ltd. ("Kissei") for all indications of amiprilose HCl in the Far East
and Russia and (ii) Irotec Laboratories of Cork, Ireland ("Irotec") to
market amiprilose HCl in the territories of the Republic of Ireland and the
Netherlands. Unless BLSI obtains marketing approval for THERAFECTIN in the
United States and Kissei and Irotec obtain marketing approval of amiprilose
HCl in their respective regions, the future milestone payments from Kissei
and Irotec will not be received.
Products Under Development And Research Programs
Compounds Approved for Clinical Development
THERAFECTIN. The Company currently expects to commence a Phase III
clinical trial for THERAFECTIN in the second quarter of 1996. THERAFECTIN
previously formed the foundation of Greenwich's drug development efforts.
Early work on THERAFECTIN revealed potent pharmacologic effects, e.g.
enhancement of killing and clearance of intracellular pathogens (including
bacteria, fungi, viruses, parasites) and anti-tumor activity. Further work
supported the immunostimulatory effects of THERAFECTIN. As the significant
anti-inflammatory effects of other known
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immunostimulants (levamisole and muramyl dipeptide) were well documented,
investigations of the potential anti-inflammatory activity of THERAFECTIN
were initiated.
Since the Merger, the Company has actively been engaged in a review of the
THERAFECTIN preclinical and clinical data, including the IND and NDA
filings made with FDA, correspondence between Greenwich and FDA, and the
transcripts of the Arthritis Advisory Committee meetings. The Company has
sought input from outside independent regulatory affairs consultants and
reviewed the preclinical and clinical data with certain of Greenwich's
scientific and regulatory affairs personnel. Based on its analysis, the
Company concluded that there was sufficient evidence of therapeutic
efficacy and that further investigation of the clinical development of
THERAFECTIN was warranted. To this end, the Company has assembled a panel
comprised of expert academic clinical rheumatologists and enlisted the aid
of medical, regulatory, and statistical consultants to assist BLSI in
formulating a clinical strategy for THERAFECTIN. The Company held a
consensus meeting with the entire panel and its consultants to discuss such
strategy (including potential protocols for any possible additional
clinical study) for THERAFECTIN. In November, the Company submitted to FDA
a draft protocol for a proposed Phase III study of THERAFECTIN. The draft
protocol is for a double-blind, placebo-controlled, multi-center study
similar to a successful Phase III study (RA-9) previously performed by
Greenwich. The Company has met with FDA to discuss the protocol and
currently intends to commence the study in the second quarter of 1996.
ALTROPANE (Parkinson's Disease-Diagnostic Agent). BLSI is developing a
nuclear medicine imaging agent, Altropane, that it believes will be useful
in the early diagnosis of Parkinson's Disease at its early stages, prior to
the onset of specific symptoms. Since administration of currently
available therapies in the early stages of Parkinson's Disease may delay
the progression of the disease, early definitive diagnosis may be of
substantial benefit. ALTROPANE is currently undergoing Phase I/II clinical
testing under a physician-sponsored IND.
Preclinical Development Programs
CDI (Cartilage-Derived Inhibitor). BLSI is developing a factor derived
from cartilage called CDI, which inhibits new blood vessel formation.
Angiogenesis (new blood vessel formation) plays a role in the growth and
spread of solid tumors throughout the body because cancerous tumors require
new blood vessels in order to grow and metastasize. The Company's
collaborating scientists have isolated and cloned CDI, and the Company
currently anticipates commencing large-scale animal testing in the second
quarter of 1996. BLSI plans to develop CDI for the treatment of solid
tumors and other diseases of neovascularization, including rheumatoid
arthritis and numerous eye diseases.
Autoimmune Diseases (Inhibition of the Expression of MHC Molecules).
Autoimmune diseases are characterized by the production of antibodies
directed against the body's own tissues, and the consequent destruction of
those tissues by the body's immune cells. Central to the pathogenesis of
these diseases is the expression of MHC (Major Histocompatibility Complex)
class II DR molecules on the surface of antigen-presenting cells that are
found within the tissues that are attacked in autoimmune disease. The
Company is developing a means to specifically inhibit MHC DR expression.
Inhibition of DR expression might provide a specific treatment for
autoimmune diseases, because of its specificity, this treatment might be
relatively free of side effects. In June 1995, BLSI entered into a
research and development collaboration agreement with Zeneca for all
indications, on a worldwide basis, of BLSI's MHC Class II Inhibition
technology. See "Summary of Offering Memorandum -- Strategic Alliances."
Cancer (Tumor Targeting). Monoclonal antibodies (MAbs) have high
specificity and high affinity and/or avidity for their antigens. Because
of this, MAbs have been considered particularly attractive as selective
carriers of diagnostic and therapeutic products. Recently, problems such
as low per cent maximum injected dose per gram of target tissue and slow
clearance and nonuniform distribution within tumors have led many to
question the future of MAbs in radioimmunodiagnosis and radioimmunotherapy.
There is thus a need for new methods for directing therapeutic molecules to
tumors that do not rely upon strict structural integrity of all MAb
molecules used, and could insure delivery of sufficient doses of
radiotherapy to tumors without harming normal tissues. The Company is
presently developing such a system to target radiotherapy to solid tumors.
This system is comprised of sequential specific binding pairs of reagents
that are injected in such a manner that the binding between functional
groups is specific and the results are maximally amplified.
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Central Nervous System (Axogenesis Factor 1). Axogenesis Factor 1 (AF-1)
is a recently discovered nerve growth factor that has the unique
characteristic of being the only factor identified so far that promotes
axon outgrowth from central nervous system (CNS) cells (i.e. CNS
regeneration). This property is significant, since the zone of partial
injury surrounding the central necrotic zone of a stroke contains live but
damaged nerve cells that have lost their axons. AF-1 would therefore
potentially salvage these partially injured cells, resulting in some
recovery of function. The same phenomena occurs in brain injury and in
spinal cord trauma. The Company hopes that AF-1 could provide the first
truly "regenerative" treatment for these conditions. Since the discovery
of AF-1 one year ago, AF-1 has been purified and amino acid composition has
been obtained. AF-1 is a peptide having 5 amino acids, which could make it
relatively simple to manufacture. Following amino acid sequencing of AF-1,
the Company believes that quantities sufficient for in vitro and in vivo
testing could be made without difficulty and at a reasonable price. This
material will then be tested in an animal model of spinal cord injury and
stroke. If the animal models are successful, then reformulation to
maximize crossing of the blood-brain barrier would have to be done prior to
filing of an IND. The Company believes that an IND could be filed within
three years although there can be no assurance to that effect.
Parkinson's Disease Therapy
The Company's interest in developing novel therapeutic agents for
Parkinson's Disease continues. However, based on recent insights into the
structure-function relationship of the D1 receptor-dopamine interaction,
the Company's emphasis has shifted toward the development of new molecules
that have been designed to mimic dopamine's action on the D1 receptor. The
Company has entertained inquiries from potential corporate partners, and
intends to pursue this R&D effort if a corporate partnership is secured.
There can be no assurances that a corporate partner will be secured or, if
secured, that the partnership will be successful.
CAPITAL INVESTMENT SINCE JANUARY 1, 1996
Pursuant to Regulation D of the Act, in January and February 1996, the
Company sold pursuant to certain subscription agreements approximately 240
units (each, a "Unit") for net proceeds to the Company of approximately
$20.8 million. Each Unit consists of (i) 1,000 shares of Series A
Convertible Preferred Stock, stated value $100 per share (the "Preferred
Stock"), and (ii) warrants to purchase 25,000 shares of Common Stock at
$.6708 per share at any time over a ten-year period. The Preferred Stock
is initially convertible at any time at the option of the holder into
shares of the Company's Common Stock pursuant to a ratio of 175.3771 shares
of Common Stock for each share of Preferred Stock. This initial conversion
ratio is subject to adjustment in February 1997 (the "Adjustment Date") if
the fair market value on the Adjustment Date of the Company's Common Stock
issuable upon conversion of one share of the Preferred Stock is less than
$130.00.
The proceeds from the Regulation S and Regulation D offers described above
are expected to be sufficient to fund the Company's current development
programs at their present levels of expenditure through 1997.
NAME CHANGE
The Company was incorporated in Delaware in 1972 under the name Greenwich
Pharmaceuticals Incorporated ("Greenwich") and, effective June 15, 1995
changed its name to Boston Life Sciences, Inc. Effective June 15, 1995,
Old BLSI merged with and into Greenwich. The Company's principal executive
offices are now located at Reservoir Place, 1601 Trapelo Road, Waltham,
Massachusetts, and its telephone number at that location is (617) 890-8263.
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RISK FACTORS
In addition to the other information appearing elsewhere or incorporated by
reference in this Prospectus, prospective investors should consider the
following factors in evaluating the Company and its business before
purchasing any of the Shares offered hereby.
DEVELOPMENT STAGE
Each of BLSI and Greenwich prior to the Merger had net operating losses
since their respective inceptions. Further, the Company has not generated
revenues to date from product sales. Presently, the Company is expected to
incur substantial additional operating losses for the foreseeable future.
The Company's ability to achieve profitability will depend, among other
things, on a combination of one or more of the following factors: the
Company's ability to obtain significant additional financing; the Company's
ability to obtain regulatory approvals for, and successfully complete the
development and commercialization of, its product candidates, preclinical
compounds and technologies; the time and cost of obtaining regulatory
approvals for its products; the Company's ability to protect its
proprietary rights, including its patent claims and the patent claims of
its licensors and collaborators; the Company's licensors' and
collaborators' ability to protect their patent claims; the Company's
ability to enter into agreements for product development and
commercialization; competing technological and market developments;
manufacturing costs associated with its products and product candidates;
and the costs of commercializing its products. There can be no assurance
that the Company will obtain required regulatory approvals, or successfully
develop, manufacture and market its products or that the Company will
achieve profitability.
STATUS OF LITIGATION
The Company was served with five complaints during 1992, which complaints
were subsequently consolidated and granted class action status, alleging
violations of the Federal securities laws and common law. On April 12,
1995, the Court entered a Final Judgment and Order of Dismissal pursuant to
Rule 23(e) of the Federal Rules of Civil Procedure approving the Class
Action Settlement and on April 25, 1995 the Court of Chancery of the State
of Delaware for New Castle County entered an Order and Final Judgment
pursuant to Rule 23.1 of the Rules of the Court of Chancery approving the
Derivative Action Settlement. During the 30-day period following such court
orders, appeals of the settlements are permitted. No appeals were accepted
and the orders approving the Class Action Settlement and the Derivative
Action Settlement are final.
EARLY STAGE OF BLSI'S PRODUCTS; NO MARKETING EXPERIENCE
None of the Company's product candidates, preclinical compounds and
technologies have been approved for marketing by FDA or FDA's international
equivalent. The evaluation, research and development of any of the
Company's product candidates, preclinical compounds or technologies
requires further extensive laboratory and clinical testing prior to
regulatory approval. There can be no assurance that any of the Company's
product development efforts will be successfully completed, that any
required regulatory approvals will be obtained, that any such product
candidates will be capable of being manufactured in commercial quantities
at reasonable cost or that any new products, if introduced, will achieve
market acceptance. Also, there can be no assurance that the Company will
not cease (i) all efforts to obtain approval of its technologies or (ii)
the research and development of any of its current compounds in preclinical
development.
In addition, BLSI has had no experience in marketing pharmaceutical
products. In order to achieve commercial success for any product
candidates, the Company will be required to either enter into arrangements
with third parties with respect to the marketing of the Company's products
or develop such marketing experience internally. There can be no assurance
that the Company will be able to enter into marketing agreements with
others on acceptable terms, if at all, or that it will successfully develop
such experience.
DEPENDENCE UPON HARVARD AND ITS AFFILIATES
BLSI currently conducts a substantial portion of its research and
development through Harvard and its Affiliates pursuant to sponsored
research agreements. Virtually all of BLSI's current technologies under
development were
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invented or discovered by researchers working for Harvard and its
Affiliates (the "BLSI Technologies"). A substantial portion of the
Company's business is thus dependent upon (i) the continuing research and
development performed by Harvard and its Affiliates pursuant to sponsored
research agreements with BLSI relating to BLSI's technologies, and (ii) the
licenses granted to BLSI with respect to the BLSI Technologies by, or the
licenses that it is seeking to acquire from, Harvard Medical School,
Harvard School of Public Health and The Children's Medical Center
Corporation. As a result of such dependence, the success of the Company
depends, in large part, upon its maintaining its sponsored research
agreements with Harvard and its Affiliates. There can be no assurances that
the Company will be successful in this regard or that Harvard and its
Affiliates will continue to provide access to their resources.
There can be no assurance that any research performed by Harvard and its
Affiliates and sponsored by the Company will ever result in any proprietary
technology which is patentable by Harvard and its Affiliates or that any
issued patents will provide the Company with any competitive advantages or
will not be successfully challenged by any third parties. Moreover, the
Company will not own licenses to all of the Company's technologies. There
can be no assurance that the Company will be able to obtain any required
licenses or that any patent applications which are the subject of such
licenses will result in the issuance of any patents.
RELIANCE UPON FUTURE COLLABORATIONS; CERTAIN PRIOR RELATIONSHIPS
The Company expects its strategy for the development, clinical testing,
manufacturing and commercializing of its product candidates, preclinical
compounds and technologies will include entering into various
collaborations with corporate partners, joint venturers, licensors, sub-
licensees and others. There can be no assurance that the Company will be
able to negotiate any such collaborative arrangements on acceptable terms,
if at all, that such arrangements will be successful or that the Company
will realize any revenues pursuant to such arrangements. Even if the
Company is able to negotiate collaborative arrangements on acceptable
terms, there can be no assurance that such collaborations will be
completed, will be successful or that disputes will not arise with respect
to the ownership rights to any technology which may be developed pursuant
to such collaborations.
In the event that the Company enters into collaborative arrangements, the
amount and timing of resources which the other parties to such
collaborations devote to these activities will not necessarily be within
the control of the Company. There can be no assurance that such parties
will perform their obligations as expected. If any of the Company's
collaborators breaches or terminates its agreement with the Company or
otherwise fails to conduct its collaborative activities in a timely manner,
the development or commercialization of the product candidate or technology
subject to such collaboration agreement may be delayed, and the Company may
be required to undertake unforeseen additional responsibilities or to
devote unforeseen additional resources to such development or
commercialization, or such development or commercialization could be
terminated. The termination or cancellation of collaborative arrangements
could also adversely affect the Company's financial condition, intellectual
property position and operations.
In addition, the Company expects to rely on third parties to manufacture
its product candidates. There can be no assurance that the Company will be
able to contract with manufacturers that meet the Company's requirements
for quality, quantity and timeliness, or that the Company would be able to
find substitute manufacturers, if necessary. Such inability to contract
for manufacturing capabilities on acceptable terms may adversely affect the
Company's ability to conduct preclinical and clinical testing and may
result in delays in obtaining regulatory approvals, which also may
adversely affect the Company. In addition, the manufacture by the Company
of its products on a commercial scale will require significant start-up
expenses and expansion of facilities and personnel, and no assurance can be
given that the Company can develop such manufacturing capability or hire
and train qualified personnel.
To the extent that the Company is not able to establish collaborative
arrangements, it will face increased capital requirements to undertake
research and development activities at its own expense and may encounter
significant delays in introducing its products into certain markets or find
that the development, manufacture or sale of its products in such markets
is adversely affected by the absence of such collaborative arrangements.
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UNCERTAINTY REGARDING PATENTS AND PROPRIETARY RIGHTS
Even though patent protection will be sought for proprietary technologies
either by the Company, its collaborators or the inventors or owners of such
technologies which are subject to licenses granted to the Company, the
patent application and issuance process can be expected to take several
years and may entail considerable expense without any assurance that any
patent will issue. The Company's ability to obtain protection for any of
its product candidates, preclinical compounds and technologies could be
delayed or adversely affected if the United States Patent and Trademark
Office (the "USPTO") requires clinical data demonstrating efficacy of
potential therapeutic agents. The failure to obtain patent protection on
the Company's product candidates, preclinical compounds and unpatented
technologies may have a material adverse effect on the Company's
competitive position and business prospects. Further, even if patents can
be obtained, there can be no assurance that any such patents will provide
the Company with any competitive advantage, that others will not
independently develop similar technologies or products or duplicate any
technology developed by or on behalf of the Company or, if patents are
issued, design around the patented aspects of any technology or products
developed by or on behalf of the Company, or that any such patent will not
be successfully challenged by a third party. It is also possible that
patented technologies or products of the Company or its licensors or
collaborators may infringe on patents or other rights owned by others,
licenses to which may not be available to the Company. The Company may
have to alter its products or processes, pay licensing fees or cease
certain activities altogether because of patent rights of third parties,
thereby causing additional unexpected costs and delays to the Company.
Patent law relating to the scope of claims in the fields of healthcare and
biosciences is still evolving, and the Company's patent rights will be
subject to this uncertainty. The Company's patent rights on its products
therefore might conflict with the patent rights of others, whether existing
now or in the future. For the same reasons, the products of others could
infringe the patent rights of the Company. The defense and prosecution of
patent claims is both costly and time-consuming, even if the outcome is
favorable to the Company. The failure of any existing or future patents
owned by or licensed to the Company or its collaborators to provide the
Company protection against competitors, including without limitation
protection against a claim of patent infringement, could subject the
Company to significant liabilities to third parties, require disputed
rights to be licensed from third parties, require the Company to alter its
products or processes or require the Company to cease selling its products.
The Company relies on trade secrets and proprietary know-how, which it
seeks, and will continue to seek, to protect in part by confidentiality
agreements with their collaborators, employees and consultants. There can
be no assurance that these agreements will not be breached, that the
Company will have adequate remedies for any such breach or that the
Company's trade secrets will not otherwise become known or be independently
developed by competitors.
To the extent that consultants, key employees or other third parties apply
technological information independently developed by them or by others to
the Company's product candidates, preclinical compounds or technologies,
disputes may arise as to the proprietary rights to such information which
may not be resolved in favor of the Company. The Company's scientific
advisors and other consultants are each employed by, and may have
consulting agreements with, third parties and any inventions discovered by
such individuals are not likely to become property of the Company.
POTENTIAL NEED FOR ADDITIONAL KEY PERSONNEL
Should the Company determine to undertake the research and development of
any of the product candidates or preclinical compounds, such research and
development and the resultant preclinical and clinical testing of its
various product candidates and preclinical compounds, the governmental
approval process and the marketing of its product candidates may require
the addition of key management and scientific personnel, in addition to
those presently employed by the Company, in areas such as research and
development, preclinical testing, clinical investigation, regulatory
affairs, manufacturing and, to the extent applicable, marketing and product
sales. The failure of the Company to attract, or to gain access to, such
personnel could have a material adverse effect on the Company's ability to
develop such product candidates, preclinical compounds and technologies.
The Company will face intense competition for such personnel from other
companies, research and academic institutions, government entities and
other organizations. There can be no assurance that the Company will be
successful in hiring, retaining or otherwise gaining access to the
personnel required for such activities.
9
<PAGE>
POTENTIAL DIFFICULTY IN OBTAINING FDA AND OTHER GOVERNMENTAL APPROVALS
The Company's products and its manufacturing and research activities will
be subject to varying degrees of regulation by a number of government
authorities in the United States and other countries, including FDA
pursuant to the Federal Food, Drug and Cosmetic Act. FDA regulates
pharmaceutical products, including their manufacture and labeling. Prior
to marketing, any product developed by the Company must undergo an
extensive regulatory approval process, which includes preclinical and
clinical testing of such product to demonstrate its safety and efficacy.
This regulatory process can require many years and the expenditure of
substantial resources. Data obtained from preclinical and clinical trials
are subject to varying interpretations, which can delay, limit or prevent
FDA approval. See "Development Stage."
None of the Company's product candidates, preclinical compounds and
technologies have been approved for marketing by FDA or FDA's international
equivalent. The Company cannot accurately predict all relevant regulatory
requirements or issues. Changes in existing laws, regulations, policies or
interpretations of prior events could prevent the Company or its licensees,
licensors or collaborators from, or could affect the timing of, achieving
compliance with regulatory requirements, including obtaining current and
future regulatory clearances, where necessary. Federal and state laws,
regulations and policies are always subject to change, with possible
retroactive effect, and depend heavily on administrative policies and
interpretations. There can be no assurance that any changes with respect
to Federal and state laws, regulations and policies, and, particularly,
with respect to FDA and other such regulatory bodies, will not have a
material adverse effect on the Company.
The process of obtaining FDA clearances can be time-consuming and
expensive, and there is no assurance that such clearances will be granted
or that the FDA review process will not involve delays that materially and
adversely affect the testing, marketing and sale of the Company's products.
Similar delays may be encountered in foreign countries. Moreover,
regulatory clearances for new products, even if granted, may include
significant limitations on the uses for which such products may be
marketed. In addition, even if regulatory approval is obtained, any
marketed product and its manufacturer are subject to continual review and
any discovery of previously unrecognized problems with a product or
manufacturer could result in suspension or limitation of approvals. There
can be no assurance that any clearances that are required, once obtained,
will not be withdrawn or that compliance with other regulatory requirements
can be maintained, to the degree that the Company may have already
complied.
LIMITED PUBLIC MARKET FOR COMMON STOCK; POSSIBLE VOLATILITY OF PRICES, NO
DIVIDENDS
Historically, the Common Stock has experienced low trading volumes. The
market price of the Common Stock also has been highly volatile and it may
continue to be highly volatile as has been the case with the securities of
other public biotechnology companies. Factors such as announcements by the
Company or its competitors concerning technological innovations, results of
clinical trials, new commercial products or procedures, proposed government
regulations and developments of disputes relating to patents or proprietary
rights may have a significant effect on the market price of the Company
securities. The securities markets have experienced volatility that
particularly effects prices of equity securities of biotechnology companies
and which often is unrelated to the performance of such companies. Thus,
changes in the market price of the Common Stock may bear no relation to the
Company's actual operations or financial results. The Company does not
expect to pay any dividends on its capital stock for the foreseeable
future.
BROKER-DEALER SALES OF COMPANY SECURITIES
The Common Stock currently is, and in the future may continue to be,
subject to a Commission rule that imposes additional sales practice
requirements on broker-dealers who sell certain securities to persons other
than established customers and accredited investors (generally institutions
with assets in excess of $5,000,000 or individual with net worth in excess
of $1,000,000 or annual income exceeding $200,000, or $300,000 jointly with
his or her spouse). For transactions covered by the rule, the broker-
dealer must make a special suitability determination for the purchaser and
receive the purchaser's written agreement to the transaction before the
sale. Consequently, the rule may affect the ability of broker-dealers to
sell the Common Stock issuable upon conversion of the Preferred Stock and
also may affect the ability of purchasers in the Offering to sell the
Preferred Stock in the secondary market.
10
<PAGE>
OUTSTANDING OPTIONS AND WARRANTS
As of December 31, 1995, the Company had granted stock options and warrants
to purchase approximately 25.8 million shares of its Common Stock at
exercise prices ranging from $.01 - $8.91 per share. Many of these
previously granted options and warrants were issued at exercise prices
substantially below the conversion price of the Preferred Stock. To the
extent that such previously issued outstanding stock options and warrants
are exercised, dilution to the percentage interest of the Company's
stockholders will occur. Moreover, the terms upon which the Company would
be able to obtain additional equity capital may be affected adversely since
the holders of such outstanding options and warrants can be expected to
exercise them at a time when the Company would, in all likelihood, be able
to obtain any needed capital on terms more favorable to the Company than
those provided in the outstanding options and warrants.
TECHNOLOGICAL CHANGE AND COMPETITION
The Company operates in rapidly evolving fields. Competition from larger,
more experienced and better capitalized companies will be intense. There
can be no assurance that developments by others will not render the
Company's product candidates, preclinical compounds or technologies
obsolete or noncompetitive or that the Company will be able to keep pace
with any new technological developments. In addition, if the Company
commences sales of products, manufacturing efficiency and marketing
capabilities are likely to be significant competitive factors. The Company
has no sales force or marketing experience. In addition, many of the
Company's competitors and potential competitors have substantially greater
capital resources, manufacturing experience, research and development
staffs and production facilities than the Company. Many of these
competitors also may have significantly greater experience than the Company
in undertaking preclinical and clinical testing of new pharmaceutical
products and obtaining FDA and other regulatory approvals of products for
use in health care.
A substantial number of patents have been applied for by and issued to
other pharmaceutical and biotechnology companies, and other companies may
have filed applications for patents, may have been issued patents or may
have obtained additional patents and proprietary rights relating to
products or processes competitive with those of the Company. Patent
applications in the United States are maintained in secrecy until patents
based thereon issue, and since publication of discoveries in the scientific
or patent literature often lags behind actual discoveries, the Company
cannot be certain that it or any of its licensors or collaborators were the
first creator of inventions covered by pending patent applications or that
it or any of such licensors or collaborators were the first to file patent
applications for such inventions. Consequently, there can be no assurance
that existing patents of the Company or any patents that may be issued to
the Company or its licensors or collaborators in the future will provide
protection against competitive products or otherwise be commercially
valuable.
POTENTIAL PRODUCT LIABILITY CLAIMS
The use of the Company's product candidates in clinical trials and the sale
of any resulting products may expose the Company to liability claims
resulting from the use of such candidates or products. These claims might
be made directly by consumers or by pharmaceutical companies or other
sellers of such products. While the Company currently has product
liability insurance, there can be no assurance that such insurance will be
sufficient to satisfy any liabilities that may arise for the Company.
Moreover, such coverage is becoming increasingly expensive and difficult to
obtain. The existing coverage will not be adequate as the Company's
product development activities progress. There can be no assurance that
adequate insurance coverage will be available to the Company in the future
at an acceptable cost, if at all. An inability to obtain sufficient
insurance coverage at an acceptable cost or otherwise to protect against
potential product liability claims could prevent or limit the
commercialization of any products by the Company. In addition, there can
be no assurance that any product liability claims will not materially and
adversely affect the business or financial condition of the Company.
UNCERTAINTY OF PHARMACEUTICAL PRICING AND RELATED MATTERS; UNCERTAIN
AVAILABILITY OF HEALTH CARE REIMBURSEMENT
The Company's business may be materially adversely affected by the
continuing efforts of government and third-party payors to contain or
reduce the costs of health care through various means. For example, in
certain foreign markets, pricing or profitability of prescription
pharmaceuticals is subject to government control. In the United States,
there
11
<PAGE>
have been a number of federal and state proposals to implement similar
government control. Over the last eighteen months, a number of bills
proposing comprehensive health care reform have been introduced in
Congress. In general, such proposals are designed to reform the health care
system to, among other things, (i) control or reduce public and private
spending on health care, (ii) provide for uniform health insurance benefits
packages and administrative efficiency in the health care system, and (iii)
provide universal access to health care within the next several years. Some
of the proposals introduced in Congress call for a pricing regulatory
oversight board (sometimes referred to as the Breakthrough Drug Pricing
Committee) which may have input and/or place caps or limitations on
pharmaceutical prices, and potential mandatory or voluntary pharmaceutical
product rebate policies. Such proposals, if adopted, could decrease the
price that the Company receives for any products it may sell in the future.
There can be no assurance that such initiatives or proposals, if adopted,
will not have an adverse effect upon the Company. In addition, there have
been a number of federal and state proposals to subject the pricing of
health care products and services to government control. It is uncertain
what legislative proposals will be adopted, if any, or what actions
federal, state or private payors for health care goods and services may
take in response to any health care reforms and no assurance can be given
that any such reforms will not have a material adverse effect on the
Company. To the extent that such proposals or reforms have a material
adverse effect on the business, financial condition and profitability of
other pharmaceutical companies that are prospective collaborators for
certain of the Company's product candidates, the Company's ability to
commercialize its product candidates may be adversely affected.
The Company's ability to commercialize pharmaceutical products may depend
in part on the extent to which reimbursement for the costs of such products
and related treatments will be available from government health
administration authorities, private health insurers and others.
Significant uncertainty exists as to the reimbursement status of newly
approved health care products, and third-party payors are increasingly
challenging the prices charged for medical products and services. There
can be no assurance that adequate third-party insurance coverage will be
available to patients to allow the Company to establish and maintain price
levels sufficient for realization of an appropriate return on its
investment in developing its product candidates. If adequate coverage and
reimbursement levels are not provided by government and third-party payors
for use of the Company's products, the market acceptance of these products
will be adversely affected. In addition, many health maintenance
organizations and other managed care companies are seeking to negotiate
substantial volume discounts for the sale of pharmaceutical products to
their members thereby reducing profit margins for manufacturers, and
competitive pressures are inducing many manufacturers to accept such
discount arrangements.
12
<PAGE>
USE OF PROCEEDS
The net proceeds from the sale of the Shares will be received by the
Selling Shareholders. The Company will not receive any proceeds from the
sale of the Shares by the Selling Stockholders.
SELLING STOCKHOLDERS
The table below sets forth certain information regarding ownership of the
Company's Common Stock and Warrants by the Selling Stockholders on March
18, 1996 and the number of Shares to be sold by them under this Prospectus.
The Shares include 42,074,976 shares of Common Stock which were issued or
are issuable upon the conversion of outstanding Preferred Shares owned by
the Selling Stockholders and 5,997,782 shares of Common Stock which were
issued or are issuable upon the exercise of Warrants owned by the Selling
Stockholders, which Preferred Shares and Warrants were acquired by the
Selling Stockholders in a private placement by the Company.
In recognition of the fact that investors may wish to be legally permitted
to sell their Shares when they deem appropriate, the Company has filed with
the Commission, under the Act, a Registration Statement on Form S-3, of
which this Prospectus forms a part, with respect to the resale of the
Shares from time to time on the Nasdaq SmallCap Market or in privately-
negotiated transactions and has agreed to prepare and file such amendments
and supplements to the Registration Statement as may be necessary to keep
the Registration Statement effective until the Shares are no longer
required to be registered for the sale thereof by the Selling Stockholders.
<TABLE>
<CAPTION>
Name of Selling Warrants Owned Shares Owned Prior Shares Being Shares Owned
Shareholder to Offering (1)(2) Offered After Offering
Number of Percent Number of Percent
Shares Shares
<S> <C> <C> <C> <C> <C> <C>
126736 CANADA, Inc. 537,250 4,306,104 3.2 4,306,104 0 0%
Strome Offshore Limited 477,500 3,827,203 2.9 3,827,203 0 0
Strome Partners, L.P. 477,500 3,827,203 2.9 3,827,203 0 0
Reliance Insurance 375,000 3,005,657 2.3 3,005,657 0 0
Company
Mr. & Mrs. Jerome J. 225,000 1,803,394 1.4 1,803,394 0 0
Mullins
Strome, Susskind 179,073 1,435,290 1.1 1,435,290 0 0
Hedgecap Fund, L.P.
Alfons Melohn 150,000 1,202,264 * 1,202,264 0 0
Rahn & Bodmer 150,000 1,202,263 * 1,202,263 0 0
Diversified Fund Ltd. 125,000 1,001,886 * 1,001,886 0 0
Robert Merrill Hunter 100,000 801,510 * 801,510 0 0
Rosalind Davidowitz 100,000 801,509 * 801,509 0 0
Vincent Lanteri and 100,000 801,509 * 801,509 0 0
Susan Lanteri
Armen Partners, L.P. 87,500 701,320 * 701,320 0 0
Legong Investments 75,000 601,133 * 601,133 0 0
N.V.
</TABLE>
13
<PAGE>
<TABLE>
<CAPTION>
Name of Selling Warrants Owned Shares Owned Prior Shares Being Shares Owned
Shareholder to Offering (1)(2) Offered After Offering
Number of Percent Number of Percent
Shares Shares
<S> <C> <C> <C> <C> <C> <C>
Moussa Rahmanan & 62,500 500,943 * 500,943 0 0
Son
Strome Hedgecap 59,699 478,489 * 478,489 0 0
Limited
Etablissement Occramis 56,250 450,850 * 450,850 0 0
Atrix-Ventana 53,933 432,275 * 432,275 0 0
Investment Co., LP
Concordia Partners, 50,000 400,755 * 400,755 0 0
L.P.
Dr. & Mrs. Douglas N. 50,000 400,755 * 400,755 0 0
Benson
IASD Health Services 50,000 400,755 * 400,755 0 0
Corp.
Kathryn K. Croughan 50,000 400,755 * 400,755 0 0
Keys Foundation 50,000 400,755 * 400,755 0 0
Lion Tower Corporation 50,000 400,755 * 400,755 0 0
Michael Bollag 50,000 400,755 * 400,755 0 0
Porter Partners, L.P. 50,000 400,755 * 400,755 0 0
Robert A. Foisie 50,000 400,755 * 400,755 0 0
Thomas G. Williams 50,000 400,755 * 400,755 0 0
Vivaldi, Ltd. 50,000 400,755 * 400,755 0 0
C.S.L. Associates, L.P. 37,500 300,567 * 300,567 0 0
Mark Berg 37,500 300,566 * 300,566 0 0
Palmetto Partners, Ltd. 37,500 300,566 * 300,566 0 0
Pyton Finance 37,500 300,566 * 300,566 0 0
Associated Urology 25,000 200,378 * 200,378 0 0
Pension Plan
Beverly O. Lobell 25,000 200,378 * 200,378 0 0
Billy K. Yeh, M.D. 25,000 200,378 * 200,378 0 0
Bios Equity Fund, L.P. 25,000 200,378 * 200,378 0 0
Bishops Merchant Group 25,000 200,378 * 200,378 0 0
Limited
Bruce Pomper 25,000 200,378 * 200,378 0 0
Charles A. Zaffuto 25,000 200,378 * 200,378 0 0
</TABLE>
14
<PAGE>
<TABLE>
<CAPTION>
Name of Selling Warrants Owned Shares Owned Prior Shares Being Shares Owned
Shareholder to Offering (1)(2) Offered After Offering
Number of Percent Number of Percent
Shares Shares
<S> <C> <C> <C> <C> <C> <C>
Debra Freedberg 25,000 200,378 * 200,378 0 0
Debra L. Freedberg 25,000 200,378 * 200,378 0 0
Trust
Demachy Worms & Co. 25,000 200,378 * 200,378 0 0
Intern'l. LTD
DeWind Partners, L.P. 25,000 200,378 * 200,378 0 0
EJA Management 25,000 200,378 * 200,378 0 0
L.L.C.
Elliott Broidy 25,000 200,378 * 200,378 0 0
Ernest Trefz 25,000 200,378 * 200,378 0 0
Evan B. Pappas 25,000 200,378 * 200,378 0 0
Finter Bank Zurich 25,000 200,378 * 200,378 0 0
Halifax Fund, L.P. 25,000 200,378 * 200,378 0 0
Herman Tauber 25,000 200,378 * 200,378 0 0
J. Jay Lobell 25,000 200,378 * 200,378 0 0
J.F. Shea Co., Inc. 25,000 200,378 * 200,378 0 0
John D. Shepherd 25,000 200,378 * 200,378 0 0
Joseph A. Natiello 25,000 200,378 * 200,378 0 0
Larich Associates 25,000 200,378 * 200,378 0 0
Michael P. Marcus 25,000 200,378 * 200,378 0 0
Monument Trust 25,000 200,378 * 200,378 0 0
Company Ltd.
Mova Investments 25,000 200,378 * 200,378 0 0
Limited
Mr. & Mrs. Delbert E. 25,000 200,378 * 200,378 0 0
Allen, Jr.
Mr. & Mrs. Derek A. 25,000 200,378 * 200,378 0 0
Bruce
Mr. & Mrs. Jeffrey C. 25,000 200,378 * 200,378 0 0
Fernyhough
Mr. & Mrs. Joseph 25,000 200,378 * 200,378 0 0
Strassman
P.A.W. Offshore Fund, 25,000 200,378 * 200,378 0 0
Ltd.
</TABLE>
15
<PAGE>
<TABLE>
<CAPTION>
Name of Selling Warrants Owned Shares Owned Prior Shares Being Shares Owned
Shareholder to Offering (1)(2) Offered After Offering
Number of Percent Number of Percent
Shares Shares
<S> <C> <C> <C> <C> <C> <C>
Patrick M. Kane 25,000 200,378 * 200,378 0 0
Peter W. Frautschi 25,000 200,378 * 200,378 0 0
Robert J. Whetten 25,000 200,378 * 200,378 0 0%
Robert Rehme 25,000 200,378 * 200,378 0 0
Roger C. Keys 25,000 200,378 * 200,378 0 0
Sagres Group LTD. 25,000 200,378 * 200,378 0 0
Scoggin Capital 25,000 200,378 * 200,378 0 0
Management, L.P.
Sharyar & Babok 25,000 200,378 * 200,378 0 0
Baradaran
Shriya Investment 25,000 200,378 * 200,378 0 0
Holdings Limited
Termtec, Ltd. 25,000 200,378 * 200,378 0 0
The Holding Company 25,000 200,378 * 200,378 0 0
Thomas R. Ulie 25,000 200,378 * 200,378 0 0
Uzi Zucker 25,000 200,378 * 200,378 0 0
Winward Venture 25,000 200,378 * 200,378 0 0
Partners, Inc.
Ventana Growth Capital 21,068 168,859 * 168,859 0 0
Fund V, L.P.
Albert Milstein 18,750 150,284 * 150,284 0 0
Neil and Laurie Spindel 18,750 150,283 * 150,283 0 0
Robert Klein, M.D. 18,750 150,283 * 150,283 0 0
The Lincoln Fund Tax 18,750 150,283 * 150,283 0 0
Advantaged, L.P.
Amram Kass P.C. 14,250 114,216 * 114,216 0 0
Defined Benefit Pension
Plan
Richard Elkin 13,750 110,208 * 110,208 0 0
Alan Weiss 12,500 100,189 * 100,189 0 0
Andre P. Visser 12,500 100,189 * 100,189 0 0
Arnold Byer and Marisa 12,500 100,189 * 100,189 0 0
Byer
Arthur or Sean Kohn 12,500 100,189 * 100,189 0 0
</TABLE>
16
<PAGE>
<TABLE>
<CAPTION>
Name of Selling Warrants Owned Shares Owned Prior Shares Being Shares Owned
Shareholder to Offering (1)(2) Offered After Offering
Number of Percent Number of Percent
Shares Shares
<S> <C> <C> <C> <C> <C> <C>
Bridgewater Partners, 12,500 100,189 * 100,189 0 0
L.P.
Carlos Plancarte Garcia 12,500 100,189 * 100,189 0 0
Naranjo
Colony Partners, A 12,500 100,189 * 100,189 0 0
California GP
Daniel F. Herrmann 12,500 100,189 * 100,189 0 0
Debra Potter 12,500 100,189 * 100,189 0 0
Frank J. Lincoln, Jr. 12,500 100,189 * 100,189 0 0
GHA Management 12,500 100,189 * 100,189 0 0
Corporation
Harold S. Goldstein 12,500 100,189 * 100,189 0 0
Harris R. L. Lydon 12,500 100,189 * 100,189 0 0
Indian Creek Capital, 12,500 100,189 * 100,189 0 0
Ltd.
Jeffrey S. Gutfreund 12,500 100,189 * 100,189 0 0
Jonathan Kurt 12,500 100,189 * 100,189 0 0
Leonard J. Adams 12,500 100,189 * 100,189 0 0
Marjorie L. Stieduhar 12,500 100,189 * 100,189 0 0
Marvin G. Barish 12,500 100,189 * 100,189 0 0
Michael Cantor 12,500 100,189 * 100,189 0 0
Michael Kubin and 12,500 100,189 * 100,189 0 0
Nicole Kubin
Mr. & Mrs. Amnon 12,500 100,189 * 100,189 0 0
Barness
Myron M. Teitelbaum, 12,500 100,189 * 100,189 0 0
M.D.
Old Oly, J.V. 12,500 100,189 * 100,189 0 0
Ralph S. O'Connor 12,500 100,189 * 100,189 0 0
RHL Associates, L.P. 12,500 100,189 * 100,189 0 0
Robert P. Gordon 12,500 100,189 * 100,189 0 0
Schottenfeld Associates, 12,500 100,189 * 100,189 0 0
L.P.
</TABLE>
17
<PAGE>
<TABLE>
<CAPTION>
Name of Selling Warrants Owned Shares Owned Prior Shares Being Shares Owned
Shareholder to Offering (1)(2) Offered After Offering
Number of Percent Number of Percent
Shares Shares
<S> <C> <C> <C> <C> <C> <C>
The Townsen Family 12,500 100,189 * 100,189 0 0
Trust
Tis Prager 12,500 100,189 * 100,189 0 0
Wayne Saker 12,500 100,189 * 100,189 0 0
Lifelines Care, Inc. 10,000 80,151 * 80,151 0 0
Scott G. Sandler 10,000 80,151 * 80,151 0 0
Harriet Brother & Bruce 8,750 70,132 * 70,132 0 0
Leibowitz
Ronald S. Baruch 8,750 70,132 * 70,132 0 0
Martin Zelman 7,500 60,114 * 60,114 0 0
Mechie Nebenzahl 7,500 60,114 * 60,114 0 0
Aaron Speisman (IRA) 6,250 50,095 * 50,095 0 0
JMS Inc. Cust. FBO
Alfred D. Morgan 6,250 50,095 * 50,095 0 0
Amy Goldberg 6,250 50,095 * 50,095 0 0
Arie Belldegrun 6,250 50,095 * 50,095 0 0
Dan Valahu 6,250 50,095 * 50,095 0 0
Edward Julie 6,250 50,095 * 50,095 0 0
Frederick J. Korniewicz 6,250 50,095 * 50,095 0 0
Geun-Eun Kim 6,250 50,095 * 50,095 0 0
Jeffrey C. Hoos, DMD 6,250 50,095 * 50,095 0 0
Lewis Cohen 6,250 50,095 * 50,095 0 0
Lindsay A. McManus 6,250 50,095 * 50,095 0 0%
M. Rafael Gonalez 6,250 50,095 * 50,095 0 0
Cavillo
Marathon Agents Profit 6,250 50,095 * 50,095 0 0
Sharing
Mark H. Maier 6,250 50,095 * 50,095 0 0
Martin S. Kratchman 6,250 50,095 * 50,095 0 0
Martine Rothblatt 6,250 50,095 * 50,095 0 0
Michael C. Miles 6,250 50,095 * 50,095 0 0
Mr. & Mrs. Alan Wise 6,250 50,095 * 50,095 0 0
</TABLE>
18
<PAGE>
<TABLE>
<CAPTION>
Name of Selling Warrants Owned Shares Owned Prior Shares Being Shares Owned
Shareholder to Offering (1)(2) Offered After Offering
Number of Percent Number of Percent
Shares Shares
<S> <C> <C> <C> <C> <C> <C>
Mr. & Mrs. Steve Beane 6,250 50,095 * 50,095 0 0
Ofelia Anton Gomez 6,250 50,095 * 50,095 0 0
Robert E. Spivak 6,250 50,095 * 50,095 0 0
Associates, Inc.
Robert J. Conrads 6,250 50,095 * 50,095 0 0
Ross D. Ain 6,250 50,095 * 50,095 0 0
Seymour Buehler 6,250 50,095 * 50,095 0 0
Stephen Unger and 6,250 50,095 * 50,095 0 0
Kathleen Unger
Stuart Schube 6,250 50,095 * 50,095 0 0
Techknoledge 6,250 50,095 * 50,095 0 0
Consulting Inc.
Elke R. de Ramirez 5,000 40,076 * 40,076 0 0
Jeffrey Rothenberg, 5,000 40,076 * 40,076 0 0
DDS
Mark B. Fisher 5,000 40,076 * 40,076 0 0
Sal and Lorraine 5,000 40,076 * 40,076 0 0
Albanese
Anthony J. Gerace 3,750 30,057 * 30,057 0 0
Mr. & Mrs. Donald R. 3,750 30,057 * 30,057 0 0
Kendall, Jr.
William G. McCahey 3,125 25,048 * 25,048 0 0
Alain M. Oberrotman 2,500 20,038 * 20,038 0 0
Alan Mitchell Troyetsky 2,500 20,038 * 20,038 0 0
Bruce Carver Jackson 2,500 20,038 * 20,038 0 0
Chaim Herman 2,500 20,038 * 20,038 0 0
Jon D. Blakesberg 2,500 20,038 * 20,038 0 0
Richard M. Liling 2,500 20,038 * 20,038 0 0
Blumen Partners 1,875 15,029 * 15,029 0 0
Mr. & Mrs. Brian 1,250 10,019 * 10,019 0 0
Johnston
____________________
</TABLE>
19
<PAGE>
* Less than one percent.
(1) Assumes the conversion of all outstanding Preferred Shares and the
exercise of all outstanding Warrants owned by the Selling
Stockholders.
(2) Based on shares of Common Stock outstanding as of April 16, 1996 and
includes 42,074,976 shares of Common Stock which were issued or are
issuable upon the conversion of outstanding Preferred Shares owned by
the Selling Stockholders and 5,997,782 shares of Common Stock which
were issued or are issuable upon the exercise of outstanding Warrants
owned by the Selling Stockholders.
PLAN OF DISTRIBUTION
The Shares offered hereby by the Selling Stockholders may be sold from time
to time by any such Selling Stockholder, or by pledgees, donees,
transferees or other successors in interest. Such sales may be made on one
or more exchanges or in the over-the-counter market (including the Nasdaq
SmallCap Market), or otherwise at prices and at terms then prevailing or at
prices related to the then-current market price, or in negotiated
transactions. The Shares may be sold by one or more of the following
methods, including, without limitation: (a) a block trade in which the
broker-dealer so engaged will attempt to sell the Shares as agent but may
position and resell a portion of the block as principal to facilitate the
transaction; (b) purchases by a broker or dealer as principal and resale by
such broker or dealer for its account pursuant to this Prospectus; (c)
ordinary brokerage transactions and transactions in which the broker
solicits purchasers; and (d) face-to-face transactions between the Selling
Stockholders and purchasers without a broker-dealer. In effecting sales,
brokers or dealers engaged by the Selling Stockholders may arrange for
other brokers or dealers to participate. Such brokers or dealers may
receive commissions or discounts from the Selling Stockholders in amounts
to be negotiated immediately prior to the sale. Such brokers or dealers
and any other participating brokers or dealers may be deemed to be
"underwriters" within the meaning of the Securities Act, in connection with
such sales. In addition, any securities covered by this Prospectus that
qualify for sale pursuant to Rule 144 under the Securities Act might be
sold under Rule 144 rather than pursuant to this Prospectus.
Upon the Company being notified by any Selling Shareholder that a material
arrangement has been entered into with a broker or dealer for the sale of
shares through a block trade, special offering, exchange distribution or
secondary distribution or a purchase by a broker or dealer, a supplemented
Prospectus will be filed, if required, pursuant to Rule 424(c) under the
Securities Act, disclosing (a) the name of each such broker-dealer, (b) the
number of shares involved, (c) the price at which such shares were sold,
(d) the commissions paid or discounts or concessions allowed to such
broker-dealer(s), which applicable, (e) that such broker-dealer(s) did not
conduct any investigation to verify the information set out or incorporated
by reference in this Prospectus, as supplemented, and (f) other facts
material to the transaction.
The Company is bearing all costs relating to the registration of Shares
(other than fees and expenses, if any, of counsel or other advisers to the
Selling Stockholders). Any commissions, discounts or other fees payable to
broker-dealers in connection with any sale of the Shares will be borne by
the Selling Stockholders selling such Shares.
20
<PAGE>
The Company has agreed to indemnify the Selling Stockholders in certain
circumstances against certain liabilities, including liabilities arising
under the Securities Act. Each Selling Stockholder has agreed to indemnify
the Company, its directors and its officers who sign the Registration
Statement against certain liabilities, including liabilities arising under
the Securities Act.
21
<PAGE>
DESCRIPTION OF SECURITIES TO BE REGISTERED
Common Stock
The description of the Company's Common Stock is contained in the Company's
Registration Statement on Form 8-A filed under the Exchange Act, including
any amendment or reports filed for the purpose of updating such
description, and is incorporated herein by reference.
Warrants
Exercise Price and Terms
Each Warrant entitles the holder thereof to purchase one share of Common
Stock at an exercise price of $.6708. Warrants are issued, subject to
adjustment in accordance with the adjustment provisions referred to below.
The Warrants may be exercised upon surrender of the Warrant certificate on
or prior to February 28, 2006 (or, if redeemed prior thereto, the date
immediately preceding the redemption date) at the offices of the Warrant
Agent, with the subscription form on the reverse side of the Warrant
certificate completed as indicated, accompanied by payment of the full
exercise price (by cashier's or certified check payable to the order of the
Warrant Agent, or by wire transfer) for the number of Warrants being
exercised. No fractional shares will be issued upon exercise of the
Warrants, and the Company will pay cash in lieu of fractional shares.
After February 28, 2006, Warrants will become void and of no value.
Adjustments
The exercise price and the number of shares of Common Stock purchasable
upon the exercise of the Warrants are subject to adjustments upon the
occurrence of certain events, such as stock dividend or stock splits of the
Common Stock. Additionally, an adjustment would be made in the case of the
reclassification or exchange of the Common Stock, consolidation or merger
of the Company with or into another corporation or sale of all or
substantially all of the assets of the Company, in order to enable Warrant
holders to acquire the kind and number of shares of Common Stock that might
otherwise have been purchased upon the exercise of the Warrant. No
adjustment to the exercise price of the shares subject to the Warrants will
be made for dividends (other than dividends in the form of stock), if any,
paid on the Common Stock.
Redemption
The Warrants are subject to redemption by the Company at $.10 per share for
each share subject to each Warrant on 60 days prior written notice provided
that the closing bid quotation for the Common Stock as reported on the
Nasdaq SmallCap Market, or on such exchange on which the Common Stock is
then traded exceeds 200% of the exercise price per share for 20 consecutive
trading days ending three days prior to the date of redemption. The
Warrants are not redeemable on or prior to February 28, 1997.
22
<PAGE>
Warrant Holder Not a Stockholder
The Warrants do not confer upon holders thereof any voting or other rights
of a stockholder of the Company. The shares of Common Stock issuable upon
exercise of the Warrants in accordance with the terms thereof will be fully
paid and nonassessable.
Transfer and Warrant Agent
The transfer and warrant agent for the Common Stock is Continental Stock
Transfer & Trust Company, 2 Broadway, New York, New York 10004.
LEGAL OPINION
The validity of the shares of Common Stock offered hereby will be passed
upon for the Company by Ballard Spahr Andrews & Ingersoll, Philadelphia,
Pennsylvania.
EXPERTS
The Consolidated Financial Statements of Greenwich and its subsidiary,
Greenwich Pharmaceuticals International Incorporated, as of December 31,
1994 and 1993 and for each of the three years in the period ended December
31, 1994 incorporated by reference in this Prospectus, have been audited by
Arthur Andersen LLP, independent public accountants, as indicated in their
report with respect thereto, and is included herein in reliance upon the
authority of said firm as experts in giving said reports. Reference is
made to said report which contains an explanatory paragraph relating to
Greenwich's ability to continue as a going concern as discussed in Note 1
to the consolidated financial statements incorporated herein. Arthur
Andersen LLP did not audit the financial statements of Greenwich for the
period from inception to December 31, 1988. Such statements are included
in from inception to December 31, 1994 totals. The statements of
operations, stockholders' equity and cash flows of Greenwich for the period
from inception (February 1969) to December 31, 1988 (not presented or
incorporated by reference separately herein) have been audited by Deloitte
& Touche LLP, independent auditors, as stated in their report, which is
incorporated herein by reference and has been so incorporated in reliance
upon the report of such firm given upon their authority as experts in
accounting and auditing. Such report includes an explanatory paragraph
that states that the ultimate success of Greenwich's development program is
dependent upon future events, the outcome of which is currently
undeterminable, and is also dependent upon obtaining additional financing
adequate to fulfill its development activities and achieving a level of
revenues adequate to support Greenwich's cost structure.
The consolidated financial statements of the Company as of December 31,
1995 and 1994, for the three years ended December 31, 1995 and for the
period from inception (October 16, 1992) through December 31, 1995,
incorporated by reference in this Prospectus from the Company's Annual
Report on Form 10-K for the year ended December 31, 1995, have been so
included in reliance on the report
23
<PAGE>
of Price Waterhouse LLP, independent accountants, given on the authority of
said firm as experts in auditing and accounting.
24
<PAGE>
================================================================================
No dealer, salesperson or any other individual has been authorized to give
any information or to make any representations not contained in this Prospectus
in connection with the offer covered by this Prospectus. If given or made, such
information or representations must not be relied upon as having been authorized
by the Company or the Selling Stockholders. This Prospectus does not constitute
an offer to sell, or a solicitation of an offer to buy, any of these securities
in any jurisdiction where, or to any person whom, it is unlawful to make such
offer or solicitation. Neither the delivery of this Prospectus nor any offer or
sale made hereunder shall, under any circumstances, create any implication that
there has been no change in the affairs of the Company or that the information
contained herein is correct as of any time subsequent to the date hereof.
TABLE OF CONTENTS
-----------------
PAGE
----
Available Information
Incorporation of Certain
Documents by Reference
The Company
Risk Factors
Use of Proceeds
Selling Stockholders
Plan of Distribution
Description of Securities
to be Registered
Legal Opinion
Experts
----------------------
================================================================================
48,072,758 Shares
BOSTON LIFE SCIENCES, INC
Common Stock
Warrants
----------------
PROSPECTUS
----------------
May , 1996
================================================================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table sets forth the costs and expenses of the sale and
distribution of the securities being registered, all of which are being
borne by the Company.
<TABLE>
<CAPTION>
<S> <C>
Securities and Exchange Commission filing fee.............. $15,747.97
Printing expenses.......................................... 15,000.00
Legal fees and expenses.................................... 13,000.00
Miscellaneous.............................................. -0-
Total.................................................... $43,747.97
</TABLE>
All of the amounts shown are estimates except for the fee payable to the
Securities and Exchange Commission.
Item 15. Indemnification of Directors and Officers
The Delaware General Corporation Law authorizes the Company to grant
indemnities to directors and officers in terms sufficiently broad to permit
indemnification of such persons under certain circumstances for liabilities
(including reimbursement for expenses incurred) arising under the
Securities Act of 1933. In addition, the Company has obtained Directors'
and Officers' Liability Insurance, which insures its officers and directors
against certain liabilities such persons may incur in their capacities as
officers or directors of the Company.
Article 6 of the Company's Amended and Restated Certificate of
Incorporation provides as follows:
SIXTH: No director of the Corporation shall be personally liable to
the Corporation or any of its stockholders for monetary damages for
breach of fiduciary duty as a director, except for liability (i) for
any breach of the director's duty of loyalty to the Corporation or
its stockholders, (ii) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law,
(iii) under Section 174 of the Delaware General Corporation Law, as
the same exists or hereafter may be amended, or (iv) for any
transaction from which the director derived an improper personal
benefit. If the Delaware General Corporation Law hereafter is
amended to authorize the further elimination or limitation of the
liability of directors, then the liability of a director of the
Corporation, in addition to the limitation on personal liability
provided herein, shall be limited to the fullest extent permitted by
the amended Delaware General Corporation Law. Any repeal or
modification of this paragraph by the stockholders of the
Corporation shall be prospective only, and shall not adversely
affect any limitation on the personal liability of a director of the
Corporation existing at the time of such repeal or modification.
II-1
<PAGE>
Item 16. Exhibits
The following is a list of exhibits filed as part of this Registration
Statement.
Exhibit
Number Description
------ -----------
4.1 Specimen copy of stock certificate for shares of Common Stock of
the Registrant (filed as an exhibit to the Registrant's
Registration Statement on Form S-3 filed with the Securities and
Exchange Commission, Registration Number 33-25955.
4.2 Form of Warrant Agreement by and among Registrant, the Warrant
Agent and Paramount Capital, Inc.
4.3 Form of Warrant Certificate for Purchase of Common Stock.
5 Opinion of Ballard Spahr Andrews & Ingersoll regarding legality
of the Company's Common Stock being registered.
23.1 Consent of Ballard Spahr Andrews & Ingersoll (included in its
opinion filed as Exhibit 5 hereto).
23.2 Consent of Price Waterhouse LLP.
24 Powers of Attorney (included on signature pages to this
Registration Statement).
Item 17. Undertakings
The undersigned registrant hereby undertakes:
(1) to file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in
the aggregate, represent a fundamental change in the information set
forth in the registration statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that which
was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more
than a 20% change in the maximum aggregate offering price set forth
in the "Calculation of Registration Fee" table in the effective
registration statement.
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) of this section
do not apply if the registration statement is on Form S-3, Form S-8 or
Form F-3, and the information required to be included in a post-effective
II-2
<PAGE>
amendment by those paragraphs is contained in periodic reports filed with
or furnished to the Commission by the registrant pursuant to section 13 or
section 15(d) of the Securities Exchange Act of 1934 that are incorporated
by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(4) If the registrant is a foreign private issuer, to file a post-
effective amendment to the registration statement to include any financial
statements required by (S) 210.3-19 of this chapter at the start of any
delayed offering or throughout a continuous offering. Financial statements
and information otherwise required by Section 10(a)(3) of the Act need not
be furnished, provided that the registrant includes in the prospectus, by
means of a post-effective amendment, financial statements required pursuant
to this paragraph (a)(4) and other information necessary to ensure that all
other information in the prospectus is at least as current as the date of
those financial statements. Notwithstanding the foregoing, with respect to
registration statements on Form F-3, a post-effective amendment need not be
filed to include financial statements and information required by section
10(a)(3) of the Act or (S) 210.3-19 of this chapter if such financial
statements and information are contained in periodic reports filed with or
furnished to the Commission by the registrant pursuant to section 13 or
section 15(d) of the Securities Exchange Act of 1934 that are incorporated
by reference in the Form F-3.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing provisions,
or otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than
the payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful defense
of any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Amendment No. 1 to Registration Statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Waltham, Commonwealth of Massachusetts, on May __, 1996.
BOSTON LIFE SCIENCES, INC.
By: /s/ S. David Hillson
-----------------------------------------
S. David Hillson
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 1 to Registration Statement has been signed by the following persons in
the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ S. David Hillson President and Chief Executive May __, 1996
----------------------------- Officer and Director (Principal
S. David Hillson Executive Officer)
* Director and Chairman
-----------------------------
Edson D. de Castro
* Director and Secretary
-----------------------------
Steve H. Kanzer, Esq.
* Director, Executive Vice President
----------------------------- and Chief Scientific Officer
Marc E. Lanser, M.D.
* Director
-----------------------------
Ira K. Lieberman, Ph.D.
* Director
-----------------------------
E. Christopher Palmer, C.P.A.
* By: /s/ S. David Hillson
---------------------------
S. David Hillson
</TABLE>
II-4
<PAGE>
EXHIBIT INDEX
-------------
<TABLE>
<CAPTION>
Exhibit
Sequential Sequential
Number Description Page Number
- ---------- ----------- -----------
<C> <S> <C>
4.1 Specimen copy of stock certificate for shares of Stock -
of the Registrant (filed as an exhibit to the
Company's Registration Statement on Form S-3 filed
with the Securities and Exchange Commission,
Registration Number 33-25955.
4.2 Form of Warrant Agreement by and among Registrant, the Warrant Agent
and Paramount Capital, Inc.
4.3 Form of Warrant Certificate for Purchase of Common Stock.
5 Opinion of Ballard Spahr Andrews & Ingersoll regarding 37
legality of the Company's Common Stock being
registered.
23.1 Consent of Ballard Spahr Andrews & Ingersoll (included 37
in its opinion filed as Exhibit 5 hereto).
23.2 Consent of Price Waterhouse LLP. 39
23.3 Consent of Deloitte & Touche LLP 41
23.4 Consent of Arthur Andersen LLP 43
</TABLE>
II-5
<PAGE>
WARRANT AGREEMENT
-----------------
AGREEMENT (this "Agreement") dated as of [ ], 1995, by and among BOSTON
LIFE SCIENCES, INC., a Delaware corporation (the "Company"), [ ], as
warrant agent (the "Warrant Agent"), and PARAMOUNT CAPITAL, INC., a New York
corporation ("Paramount").
W I T N E S S E T H
- - - - - - - - - -
WHEREAS, in connection with a private placement (the "Private Placement")
of units (each, a "Unit"), consisting of (a) 1,000 shares of the Premium
Preferred Stock, stated value $100.00 per share (the "Preferred Stock"), and
(b) warrants (the "Common Stock Warrants") to purchase 25,000 shares of common
stock, par value $.01 per share (the "Common Stock"), with a minimum of 10 Units
(the "Minimum Offering") and a maximum of ___ Units (the "Maximum Offering")
sold through this offering (the "Offering"); and
WHEREAS, the Company desires the Warrant Agent to act on behalf of the
Company, and the Warrant Agent is willing to so act, in connection with the
issuance, registration, transfer, exchange and redemption of the Warrants, the
issuance of certificates representing the Warrants, the exercise of the
Warrants, and the rights of the holders thereof;
NOW THEREFORE, in consideration of the premises and the mutual agreements
hereinafter set forth and for the purpose of defining the terms and provisions
of the Warrants and the certificates representing the Warrants and the
respective rights and obligations thereunder of the Company, the holders of
certificates representing the Warrants and the Warrant Agent, the parties hereto
agree as follows:
SECTION 1. Definitions. As used herein, the following terms shall have the
-----------
following meanings:
(a) "Common Stock" shall mean stock of the Company of any class, whether
now or hereafter authorized which has the right to participate in the
distributions of earnings and assets of the Company without limit as to amount
or percentage, which at the date hereof consists of 175,000,000 authorized
shares of Common Stock.
(b) "Corporate Office" shall mean the office of the Warrant Agent (or its
successor) at which at any particular time its principal business shall be
administered, which office is located at the date hereof at Reservoir Place,
1601 Trapelo Road, Waltham, MA, 02154.
(c) "Exercise Date" shall mean, as to any Warrant, the date on which the
Warrant Agent shall have received both (a) the Warrant Certificate representing
such Warrant, with the exercise form thereon duly executed by the Registered
Holder thereof or
1
<PAGE>
his attorney duly authorized in writing, and (b) payment in cash, or by official
bank or certified check made payable to the Company, of an amount in lawful
money of the United States of America equal to the applicable Purchase Price.
(d) "Purchase Price" shall mean the purchase price to be paid upon
exercise of each Warrant in accordance with the terms hereof, which price shall
be equal to the lesser of (a) $1.00 per share and (b) the average closing bid
price of the Common Stock on the National Association of Securities Dealers Inc.
Automated Quotation System ("Nasdaq") for the thirty consecutive trading days
immediately preceding the Closing Date on which such Warrants are issued,
subject to adjustment from time to time pursuant to the provisions of Section 8
hereof, and subject to the Company's right to reduce the Purchase Price upon
notice to all warrantholders.
(e) "Registered Holder" shall mean the person in whose name any
certificate representing Warrants shall be registered on the books maintained by
the Warrant Agent pursuant to Section 6.
(f) "Transfer Agent" shall mean,____________________ as the Company's
transfer agent, or its authorized successor, as such.
(g) "Warrant Expiration Date" shall mean 5:00 P.M. (New York time) on
[ ], 2005; provided that if such date shall in the State of New York be a
holiday or a day on which banks are authorized to close, then 5:00 P.M. (New
York time) on the next following day which in the State of New York is not a
holiday or a day on which banks are authorized to close. Upon notice to all
warrantholders the Company shall have the right to extend the Warrant Expiration
Date.
SECTION 2. Warrants and Issuance of Warrant Certificates.
----------------------------------------------
(a) A Warrant shall initially entitle the Registered Holder of the Warrant
Certificate representing such Warrant to purchase one share of Common Stock upon
the exercise thereof, in accordance with the terms hereof, subject to
modification and adjustment as provided in Section 8.
(b) From time to time, up to the Warrant Expiration Date, the Transfer
Agent shall execute and deliver stock certificates in required whole number
denominations representing up to an aggregate of 3,300,000 shares of Common
Stock, subject to adjustment as described herein, upon the exercise of Warrants
in accordance with this Agreement.
(c) From time to time, up to the Warrant Expiration Date, the Warrant
Agent shall execute and deliver Warrant Certificates in required whole number
denominations to the persons entitled thereto in connection with any transfer
or exchange permitted under this Agreement; provided that no Warrant
Certificates shall be issued except (i) those initially issued hereunder, (ii)
those issued on or after the Initial Warrant Exercise
2
<PAGE>
Date, upon the exercise of fewer than all Warrants represented by any Warrant
Certificate, to evidence any unexercised Warrants held by the exercising
Registered Holder, (iii) those issued upon any transfer or exchange pursuant to
Section 6; (iv) those issued in replacement of lost, stolen, destroyed or
mutilated Warrant Certificates pursuant to Section 7; and (v) at the option of
the Company, in such form as may be approved by the its Board of Directors, to
reflect (a) any adjustment or change in the Purchase Price or the number of
shares of Common Stock purchasable upon exercise of the Warrants, made pursuant
to Section 8 hereof and (b) other modifications approved by Warrantholders in
accordance with Section 16 hereof.
SECTION 3. Form and Execution of Warrant Certificates.
------------------------------------------
(a) The Warrant Certificates shall be substantially in the form annexed
hereto as Exhibit A (the provisions of which are hereby incorporated herein) and
may have such letters, numbers or other marks of identification or designation
and such legends, summaries or endorsements printed, lithographed, engraved or
typed thereon as the Company may deem appropriate and as are not inconsistent
with the provisions of this Agreement, or as may be required to comply with any
law or with any rule or regulation made pursuant thereto or with any rule or
regulation of any stock exchange on which the Warrants may be listed, or to
conform to usage. The Warrant Certificates shall be dated the date of issuance
thereof (whether upon initial issuance, transfer, exchange or in lieu of
mutilated, lost, stolen, or destroyed Warrant Certificates) and issued in
registered form. Warrants shall be numbered serially with the letter W.
(b) Warrant Certificates shall be executed on behalf of the Company by its
Chairman of the Board, President or any Vice President and by its Secretary or
an Assistant Secretary, by manual signatures or by facsimile signatures printed
thereon, and shall have imprinted thereon a facsimile of the Company's seal. In
case any officer of the Company who shall have signed any of the Warrant
Certificates shall cease to be such officer of the Company before the date of
issuance of the Warrant Certificates and issue and delivery thereof, such
Warrant Certificates may nevertheless be issued and delivered with the same
force and effect as though the person who signed such Warrant Certificates had
not ceased to be such officer of the Company. After execution by the Company,
Warrant Certificates shall be delivered by the Warrant Agent to the Registered
Holder.
SECTION 4. Exercise.
--------
(a) Each Warrant may be exercised by the Registered Holder thereof at any
time prior to the Warrant Expiration Date, upon the terms and subject to the
conditions set forth herein and in the applicable Warrant Certificate. A
Warrant shall be deemed to have been exercised immediately prior to the close of
business on the Exercise Date and the person entitled to receive the securities
deliverable upon such exercise shall be treated for all purposes as the holder
upon exercise thereof as of the close of business on the Exercise Date. As soon
as practicable on or after the Exercise Date, the Warrant Agent shall deposit
the
3
<PAGE>
proceeds received from the exercise of a Warrant, and promptly after clearance
of checks received in payment of the Purchase Price pursuant to such Warrants,
cause to be issued and delivered by the Transfer Agent, to the person or persons
entitled to receive the same, a certificate or certificates for the securities
deliverable upon such exercise, (plus a certificate for any remaining
unexercised Warrants of the Registered Holder). Notwithstanding the foregoing,
in the case of payment made in the form of a check drawn on an account of
Paramount or such other investment banks and brokerage houses as the Company
shall approve, certificates shall immediately be issued without any delay. Upon
the exercise of any Warrant and clearance of the funds received, the Warrant
Agent shall promptly remit the payment received for the Warrant to the Company
or as the Company may direct in writing.
(b) On the Exercise Date in respect of the exercise of any Warrant,
simultaneously with the receipt of the proceeds upon exercise of the Warrant(s)
so exercised, the Company shall pay from the proceeds received upon exercise of
the Warrant(s), a fee of 5% of the Purchase Price to Paramount (of which a
portion may be reallowed by Paramount in its sole discretion to any member of
the National Association of Securities Dealers, Inc. who solicited the
exercise). Within five days after exercise, the Warrant Agent shall send
Paramount a copy of the reverse side of each Warrant exercised. The Company
shall reimburse the Warrant Agent, upon request, for its reasonable expenses
relating to compliance with this Section 4(b). In addition, Paramount may at
any time during business hours, examine the records of the Warrant Agent,
including its ledger of original Warrant Certificates returned to the Warrant
Agent upon exercise of Warrants. The provisions of this paragraph may not be
modified, amended or deleted without the prior written consent of Paramount.
SECTION 5. Reservation of Shares; Listing; Payment of Taxes; etc. (a) The
-----------------------------------------------------
Company covenants that it will at all times reserve and keep available out of
its authorized Common Stock, solely for the purpose of issue upon exercise of
Warrants, such number of shares of Common Stock as shall then be issuable upon
the exercise of all outstanding Warrants. The Company covenants that all shares
of Common Stock which shall be issuable upon exercise of the Warrants and
payment of the Purchase Price shall, at the time of delivery, be duly and
validly issued, fully paid, nonassessable and free from all taxes, liens and
charges with respect to the issue thereof (other than those that arise as a
result of the action or inaction of the Registered Holder).
(b) The Company will use reasonable best efforts to obtain appropriate
approvals or registrations under state "blue sky" securities laws with respect
to the exercise of the Warrants; provided, however, that the Company shall not
be obligated to file any general consent to service of process or qualify as a
foreign corporation in any jurisdiction. With respect to any such securities
laws, however, Warrants may not be exercised by, or shares of Common Stock
issued to, any Registered Holder in any state in which such exercise would be
unlawful.
4
<PAGE>
(c) The Company shall pay all documentary, stamp or similar taxes and
other governmental charges that may be imposed with respect to the issuance of
Warrants, or the issuance, or delivery of any shares upon exercise of the
Warrants; provided, however, that if the shares of Common Stock are to be
delivered in a name other than the name of the Registered Holder of the Warrant
Certificate representing any Warrant being exercised, then no such delivery
shall be made unless the person requesting the same has paid to the Warrant
Agent the amount of transfer taxes or charges incident thereto, if any.
(d) The Warrant Agent is hereby irrevocably authorized to requisition the
Company's Transfer Agent from time to time for certificates representing shares
of Common Stock required upon exercise of the Warrants, and the Company will
authorize the Transfer Agent to comply with all such proper requisitions.
SECTION 6. Exchange and Registration of Transfer.
-------------------------------------
Subject to the restrictions on transfer contained in the Warrant
Certificates and the Subscription Agreements between the Company and the
purchasers of Units:
(a) Warrant Certificates may be exchanged for other Warrant Certificates
representing an equal aggregate number of Warrants of the same class or may be
transferred in whole or in part; provided that no transfers, sales or other
dispositions of the Warrants may be made except in accordance with Section 8 of
the Subscription Agreement. Warrant Certificates to be exchanged shall be
surrendered to the Warrant Agent at its Corporate Office, and upon satisfaction
of the terms and provisions hereof, the Company shall execute, and the Warrant
Agent shall countersign, issue and deliver in exchange therefor the Warrant
Certificate or Certificates which the Registered Holder making the exchange
shall be entitled to receive.
(b) The Warrant Agent shall keep at its office books in which, subject to
such reasonable regulations as it may prescribe, it shall register Warrant
Certificates and the transfer thereof in accordance with its regular practice.
Upon due presentment for registration of transfer of any Warrant Certificate at
its office, the Company shall execute and the Warrant Agent shall issue and
deliver to the transferee or transferees a new Warrant Certificate or
Certificates representing an equal aggregate number of Warrants.
(c) With respect to all Warrant Certificates presented for registration of
transfer, or for exchange or exercise, the subscription form on the reverse
thereof shall be duly endorsed, or be accompanied by a written instrument or
instruments of transfer and subscription, in form satisfactory to the Company,
duly executed by the Registered Holder or his attorney-in-fact duly authorized
in writing.
(d) The Company may require payment by such holder of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
therewith.
<PAGE>
(e) All Warrant Certificates surrendered for exercise or for exchange in
case of mutilated Warrant Certificates shall be promptly canceled by the Warrant
Agent and thereafter retained by the Warrant Agent until termination of this
Agreement or resignation of the Warrant Agent, or, with the prior written
consent of Paramount, disposed of or destroyed, at the direction of the Company.
(f) Prior to due presentment for registration of transfer thereof, the
Company and the Warrant Agent may deem and treat the Registered Holder of any
Warrant Certificate as the absolute owner thereof and of each Warrant
represented thereby (notwithstanding any notations of ownership of writing
thereon made by anyone other than a duly authorized officer of the Company or
the Warrant Agent) for all purposes and shall not be affected by any notice to
the contrary.
SECTION 7. Loss or Mutilation. Upon receipt by the Company and the
------------------
Warrant Agent of evidence satisfactory to them of the ownership of and loss,
theft, destruction or mutilation of any Warrant Certificate and (in case of
loss, theft or destruction) of indemnity satisfactory to them, and (in the case
of mutilation) upon surrender and cancellation thereof, the Company shall
execute and the Warrant Agent shall (in the absence of notice to the Company
and/or Warrant Agent that the Warrant Certificate has been acquired by a
bonafide purchaser) countersign and deliver to the Registered Holder in lieu
thereof a new Warrant Certificate of like tenor representing an equal aggregate
number of Warrants. Applicants for a substitute Warrant Certificate shall comply
with such other reasonable regulations and pay such other reasonable charges as
the Warrant Agent may prescribe.
SECTION 8. Adjustment of Purchase Price and Number of Shares of Common
-----------------------------------------------------------
Stock or Warrants.
-----------------
(a) Subject to the exceptions referred to in Section 8(g) below, in the
event the Company shall, at any time or from time to time after the date hereof,
sell any shares of Common Stock for a consideration per share less than the then
applicable Purchase Price and less than the current fair market value per share
of the Common Stock on the date of the sale or issue any shares of Common Stock
as a stock dividend to the holders of Common Stock, or subdivide or combine the
outstanding shares of Common Stock into a greater or lesser number of shares
(any such sale, issuance, subdivision or combination being herein called a
"Change of Shares"), then, and thereafter upon each further Change of Shares,
the Purchase Price in effect immediately prior to such Change of Shares shall be
changed to a price (including any applicable fraction of a cent) determined by
multiplying the Purchase Price in effect immediately prior thereto by a
fraction, the numerator of which shall be the sum of the number of shares of
Common Stock outstanding immediately prior to the issuance of such additional
shares and the number of shares of Common Stock which the aggregate
consideration received (determined as provided in subsection 8(f)(F) below), if
any, for the issuance of such additional shares would purchase at such current
market price per share of Common Stock, and the denominator of which shall be
the number of shares of Common
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<PAGE>
Stock outstanding immediately after the issuance of such additional shares. Such
adjustment shall be made successively whenever such an issuance is made.
Upon each adjustment of the Purchase Price pursuant to this
Section 8, the total number of shares of Common Stock purchasable upon the
exercise of each Warrant shall (subject to the provisions contained in Section
8(b) hereof) be such number of shares (calculated to the nearest tenth)
purchasable at the Purchase Price immediately prior to such adjustment
multiplied by a fraction, the numerator of which shall be the Purchase Price in
effect immediately prior to such adjustment and the denominator of which shall
be the Purchase Price in effect immediately after such adjustment.
(b) The Company may elect, upon any adjustment of the Purchase
Price hereunder, to adjust the number of Warrants outstanding, in lieu of the
adjustment in the number of shares of Common Stock purchasable upon the exercise
of each Warrant as hereinabove provided, so that each Warrant outstanding after
such adjustment shall represent the right to purchase one share of Common Stock.
Each Warrant held of record prior to such adjustment of the number of Warrants
shall become that number of Warrants (calculated to the nearest tenth)
determined by multiplying the number one by a fraction, the numerator of which
shall be the Purchase Price in effect immediately prior to such adjustment and
the denominator of which shall be the Purchase Price in effect immediately after
such adjustment. Upon each adjustment of the number of Warrants pursuant to
this Section 8, the Company shall, as promptly as practicable, cause to be
distributed to each Registered Holder of Warrant Certificates on the date of
such adjustment Warrant Certificates evidencing, subject to Section 10 hereof,
the number of additional Warrants to which such Holder shall be entitled as a
result of such adjustment or, at the option of the Company, cause to be
distributed to such Holder in substitution and replacement for the Warrant
Certificates held by him prior to the date of adjustment (and upon surrender
thereof, if required by the Company) new Warrant Certificates evidencing the
number of Warrants to which such Holder shall be entitled after such adjustment.
(c) In case of any reclassification, capital reorganization or
other change of outstanding shares of Common Stock, or in case of any
consolidation or merger of the Company with or into another corporation (other
than a consolidation or merger in which the Company is the continuing
corporation and which does not result in any reclassification, capital
reorganization or other change of outstanding shares of Common Stock), or in
case of any sale or conveyance to another corporation of the property of the
Company as, or substantially as, an entirety (other than a sale/leaseback,
mortgage or other financing transaction), the Company shall cause effective
provision to be made so that each holder of a Warrant then outstanding shall
have the right thereafter, by exercising such Warrant, to purchase the kind and
number of shares of stock or other securities or property (including cash)
receivable upon such reclassification, capital reorganization or other change,
consolidation, merger, sale or conveyance by a holder of the number of shares of
Common Stock that might have been purchased upon exercise of such Warrant
immediately prior to such reclassification, capital reorganization or other
change, consolidation, merger, sale or
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<PAGE>
conveyance. Any such provision shall include provision for adjustments that
shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Section 8. The foregoing provisions shall similarly apply to
successive reclassifications, capital reorganizations and other changes of
outstanding shares of Common Stock and to successive consolidations, mergers,
sales or conveyances.
(d) Irrespective of any adjustments or changes in the Purchase Price or
the number of shares of Common Stock purchasable upon exercise of the Warrants,
the Warrant Certificates theretofore and thereafter issued shall, unless the
Company shall exercise its option to issue new Warrant Certificates pursuant to
Section 2(c) hereof, continue to express the Purchase Price per share and the
number of shares purchasable thereunder as the Purchase Price per share, and the
number of shares purchasable were expressed in the Warrant Certificates when the
same were originally issued.
(e) After each adjustment of the Purchase Price pursuant to this Section
8, the Company will promptly prepare a certificate signed by the Chairman or
President of the Company setting forth: (i) the Purchase Price as so adjusted,
(ii) the number of shares of Common Stock purchasable upon exercise of each
Warrant after such adjustment, and, if the Company shall have elected to adjust
the number of Warrants, the number of Warrants to which the registered holder of
each Warrant shall then be entitled, and the adjustment in Redemption Price
resulting therefrom, and (iii) a brief statement of the facts accounting for
such adjustment. The Company will promptly file such certificate with the
Warrant Agent and cause a brief summary thereof to be sent by ordinary first
class mail to Paramount and to each registered holder of Warrants at his last
address as it shall appear on the registry books of the Warrant Agent. No
failure to mail such notice nor any defect therein or in the mailing thereof
shall affect the validity thereof except as to the holder to whom the Company
failed to mail such notice, or except as to the holder whose notice was
defective. The affidavit of an officer of the Warrant Agent or the Secretary or
an Assistant Secretary of the Company that such notice has been mailed shall, in
the absence of fraud, be prima facie evidence of the facts stated therein.
(f) For purposes of Section 8(a) and 8(b) hereof, the following provisions
(A) to (F) shall also be applicable:
(A) The number of shares of Common Stock outstanding at any given
time shall include shares of Common Stock owned or held by or for the
account of the Company and the sale or issuance of such treasury shares or
the distribution of any such treasury shares shall not be considered a
Change of Shares for purposes of said sections
(B) No adjustment of the Purchase Price shall be made unless such
adjustment would require an increase or decrease of at least $.01 in such
price; provided that any adjustments which by reason of this clause (B) are
not required to be made shall be carried forward and shall be made at the
time of
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<PAGE>
and together with the next subsequent adjustment which, together with any
adjustment(s) so carried forward, shall require an increase or decrease of at
least $.01 in the Purchase Price then in effect hereunder.
(C) In case of (1) the sale by the Company for cash of any rights or
warrants to subscribe for or purchase, or any options for the purchase of,
Common Stock or any securities convertible into or exchangeable for Common Stock
without the payment of any further consideration other than cash, if any (such
convertible or exchangeable securities being herein called "Convertible
Securities"), or (2) the issuance by the Company, without the receipt by the
Company of any consideration therefore, of any rights or warrants to subscribe
for or purchase, or any options for the purchase of, Common Stock or Convertible
Securities, in each case, if (and only if) the consideration payable to the
Company upon the exercise of such rights, warrants or options, shall consist of
cash, whether or not such rights, warrants or options, or the right to convert
or exchange such Convertible Securities, are immediately exercisable, and the
price per share for which Common Stock is issuable upon the exercise of such
rights, warrants or options or upon the conversion or exchange of such
Convertible Securities (determined by dividing (x) the minimum aggregate
consideration payable to the Company upon the exercise of such rights, warrants
or options, plus the consideration received by the Company for the issuance or
sale of such rights, warrants or options, plus, in the case of such Convertible
Securities, the minimum aggregate amount of additional consideration, if any,
other than such Convertible Securities, payable upon the conversion or exchange
thereof, by (y) the total maximum number of shares of Common Stock issuable upon
the exercise of such rights, warrants or options or upon the conversion or
exchange of such Convertible Securities issuable upon the exercise of such
rights, warrants or options) is less than the Market Price of the Common Stock
on the date of the issuance or sale of such rights, warrants or options, then
the total maximum number of shares of Common Stock issuable upon the exercise of
such rights, warrants or options or upon the conversion or exchange of such
Convertible Securities (as of the date of the issuance or sale of such rights,
warrants or options) shall be deemed to be outstanding shares of Common Stock
for purposes of Sections 8(a) and 8(b) hereof and shall be deemed to have been
sold for cash in an amount equal to such price per share.
(D) In case of the sale by the Company for cash of any Convertible
Securities, whether or not the right of conversion or exchange thereunder is
immediately exercisable, and the price per share for which Common Stock is
issuable upon the conversion or exchange of such Convertible Securities
(determined by dividing (x) the total amount of consideration received by the
Company for the sale of such Convertible Securities, plus the minimum aggregate
amount of additional consideration, if any, other than such
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<PAGE>
Convertible Securities, payable upon the conversion or exchange thereof, by
(y) the total maximum number of shares of Common Stock issuable upon the
conversion or exchange of such convertible Securities) is less than the Market
Price of the Common Stock on the date of the sale of such Convertible
Securities, then the total maximum number of shares of Common Stock issuable
upon the conversion or exchange of such Convertible Securities (as of the date
of the sale of such Convertible Securities) shall be deemed to be outstanding
shares of Common Stock for purposes of Sections 8(a) and 8(b) hereof and shall
be deemed to have been sold for cash in an amount equal to such price per share.
(E) If the exercise or purchase price provided for in any right, warrant
or option referred to in (C) above, or the rate at which any Convertible
Securities referred to in (C) or (D) above are convertible into or exchangeable
for Common Stock, shall change at any time (other than under or by reason of
provisions designed to protect against dilution), the Purchase Price then in
effect here undershall forthwith be readjusted to such Purchase Price as would
have obtained (1) had the adjustments made upon the issuance or sale of such
rights, warrants, options or Convertible Securities been made upon the basis of
the issuance of only the number of shares of Common Stock theretofore actually
delivered (and the total consideration received therefor) upon the exercise of
such rights, warrants or options or upon the conversion or exchange of such
Convertible Securities, (2) had adjustments been made on the basis of the
Purchase Price as adjusted under clause (1) for all transactions (which would
have affected such Purchase Price) made after the issuance or sale of such
rights, warrants, options or Convertible Securities, and (3) had any such
rights, warrants, options or Convertible Securities then still outstanding been
originally issued or sold at the time of such change. On the expiration of any
such right, warrant or option or the termination of any such right to convert or
exchange any such Convertible Securities, the Purchase Price then in effect
hereunder shall forthwith be readjusted to such Purchase Price as would have
obtained (a) had the adjustments made upon the issuance or sale of such rights,
warrants, options or Convertible Securities been made upon the basis of the
issuance of only the number of shares of Common Stock theretofore actually
delivered (and the total consideration received therefor) upon the exercise of
such rights, warrants or options or upon the conversion or exchange of such
Convertible Securities and (b) had adjustments been made on the basis of the
Purchase Price as adjusted under clause (a) for all transactions (which would
have affected such adjusted Purchase Price) made after the issuance or sale of
such rights, warrants, options or Convertible Securities.
(F) In case of the sale for cash of any shares of Common Stock, any
Convertible Securities, any rights or warrants to subscribe for or purchase, or
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<PAGE>
any options for the purchase of, Common Stock or Convertible Securities,
the consideration received by the Company therefore shall be deemed to be
the gross sales price therefor without deducting therefrom any expense paid
or incurred by the Company or any underwriting discounts or commissions or
concessions paid or allowed by the Company in connection therewith.
(g) No adjustment to the Purchase Price of the Warrants or to the number of
shares of Common Stock purchasable upon the exercise of each Warrant will be
made, however,
(i) upon the exercise of any of the options presently outstanding
under the Company's Stock Option Plan (the "Plan") for officers, directors
and certain other key personnel of the Company; or
(ii) upon the grant or exercise of any other options which may
hereafter be granted or exercised under the Plan; or
(iii) upon the sale or exercise of the Warrants or any other Warrants
issued by the Company; or
(iv) upon the conversion of the Preferred Stock underlying any Units
sold in the Private Placement; or
(v) upon the issuance or sale of Common Stock upon conversion or
exchange of any Convertible Securities, whether or not any adjustment in
the Purchase Price was made or required to be made upon the issuance or
sale of such Convertible Securities and whether or not such Convertible
Securities were outstanding on the date of the original sale of the
Warrants or were thereafter issued or sold; or
(vi) upon any amendment to or change in the terms of any rights or
warrants to subscribe for or purchase, or options for the purchase of,
Common Stock or Convertible Securities or in the terms of any Convertible
Securities, including, but not limited to, any extension of any expiration
date of any such right, warrant or option, any change in any exercise or
purchase price provided for in any such right, warrant or option, any
extension of any date through which any Convertible Securities are
convertible into or exchangeable for Common Stock or any change in the rate
at which any Convertible Securities are convertible into or exchangeable
for Common Stock (other than rights, warrants, options or Convertible
Securities issued or sold after the close of business on the date of the
original issuance of the Warrants (i) for which an adjustment in the
Purchase Price then in effect was theretofore made or required to be made,
upon the issuance or sale thereof, or (ii) for which such an adjustment
would have been required had the exercise or purchase price of
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<PAGE>
such rights, warrants or options at the time of the issuance or sale
thereof or the rate of conversion or exchange of such Convertible
Securities, at the time of the sale of such Convertible Securities, or the
issuance or sale of rights or warrants to subscribe for or purchase, or
options for the purchase of, such Convertible Securities, been the price
or rate as changed, in which case the provisions of Section 8(f)(E) hereof
shall be applicable if, but only if, the exercise or purchase price
thereof, as changed, or the rate of conversion or exchange thereof, as
changed, consists of cash or requires the payment of additional
consideration, if any, consisting of cash and the Company did not receive
any consideration other than cash, if any, in connection with such
change).
(h) As used in this Section 8, the term "Common Stock" shall mean and
include the Company's Common Stock authorized on the date of the original issue
of the Units and shall also include any capital stock of any class of the
Company thereafter authorized which shall not be limited to a fixed sum or
percentage in respect of the rights of the holders thereof to participate in
dividends and in the distribution of assets upon the voluntary liquidation,
dissolution or winding up of the Company; provided, however, that the shares
issuable upon exercise of the Warrants shall include only shares of such class
designated in the Company's Certificate of Incorporation as Common Stock on the
date of the original issue of the Units or (i), in the case of any
reclassification, change, consolidation, merger, sale or conveyance of the
character referred to in Section 8(c) hereof, the stock, securities or property
provided for in such section or (ii), in the case of any reclassification or
change in the outstanding shares of Common Stock issuable upon exercise of the
Warrants as a result of a subdivision or combination or consisting of a change
in par value, or from par value to no par value, or from no par value to par
value, such shares of Common Stock as so reclassified or changed.
(i) Any determination as to whether an adjustment in the Purchase Price
in effect hereunder is required pursuant to Section 8, or as to the amount of
any such adjustment, if required, shall be binding upon the holders of the
Warrants and the Company if made in good faith by the Board of Directors of the
Company.
(j) If and whenever the Company shall declare any dividends or
distributions or grant to the holders of Common Stock, as such, rights or
warrants to subscribe for or to purchase, or any options for the purchase of,
Common Stock or securities convertible into or exchangeable for or carrying a
right, warrant or option to purchase Common Stock, the Company shall notify each
of the then Registered Holders of the Warrants of such event prior to its
occurrence to enable such Registered Holders to exercise their Warrants and
participate as holders of Common Stock in such event.
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SECTION 9. Redemption
----------
(a) The Warrant is not redeemable at the option of the company prior to
[ ], 1996. The Warrant may be redeemed at the election of the Company, in whole
but not in part, at any time on or after [ ], 1996, at $.10 per Warrant (the
"Redemption Price") provided that either (i) the closing bid quotation for the
Common Stock as reported on Nasdaq, or on such other exchange on which the
Common Stock is then traded, exceeds 200% of the Purchase Price for twenty (20)
consecutive trading days ending three days prior to the date of redemption.
(b) The election of the Company to redeem the Warrants shall be
evidenced by a resolution of the board of directors of the Company, which shall
be delivered to the Warrant Agent and Paramount at or prior to the date of
notice of redemption.
(c) At the sole cost and expense of the Company notice of redemption
shall be given by the Company, or at the Company's request, by the Warrant
Agent, to the Registered Holders at each Registered Holder's address appearing
in the Warrant register, by first class-mail, postage prepaid, mailed sixty (60)
days prior to the Redemption Date.
All the notices of redemption shall state in reasonable detail:
(1) the date fixed for redemption of the Warrants (the "Redemption
Date");
(2) the Redemption Price;
(3) that on the Redemption Date, the Redemption Price will become due and
payable upon each Warrant;
(4) the Purchase Price, the date on which the right to exercise the
Warrants will terminate and the place or places where the Warrants may be
exercised;
(5) the place or places where the Warrants are to be surrendered for
payment of the Redemption Price.
(d) On or before the Redemption Date, the Company shall deposit with the
Warrant Agent (or if the Company is acting as its own paying agent, in a
segregated, trust account or at the Company's option with a paying agent
authorized by the Company to pay the Redemption Price on behalf of the Company),
an amount of money sufficient to pay the Redemption Price of all the Warrants to
be redeemed on the Redemption Date other than any Warrants which have been
exercised prior to the date of deposit.
If any Warrant called for redemption is exercised on or prior to the
Redemption Date, any money deposited with the Warrant Agent (or any
aforementioned paying agent) shall be paid to the Company upon written request
stating the reasons therefor.
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(e) Notice of redemption having been given as aforesaid, the Warrants
so to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price and at the place or places therein specified. Upon surrender of
each such Warrant for redemption in accordance with said notice, such Warrant
shall be paid by the Company at the Redemption Price.
If any Warrant called for redemption shall not be so paid upon
surrender therefor, the Redemption Price shall, until paid, bear interest
compounded daily from the Redemption Date at the maximum rate permitted by
applicable law not to exceed 18% per annum.
SECTION 10. Fractional Warrants and Fractional Shares.
-----------------------------------------
(a) If the number of shares of Common Stock purchasable upon the
exercise of each Warrant is adjusted pursuant to Section 8 hereof, the Company
shall nevertheless not be required to issue fractions of shares, upon exercise
of the Warrants or otherwise, or to distribute certificates that evidence
fractional shares. With respect to any fraction of a share called for upon any
exercise hereof, the Company shall pay to the Holder an amount in cash equal to
such fraction multiplied by the current market value of such fractional share,
determined as follows:
(1) If the Common Stock is listed on a national securities
exchange or admitted to unlisted trading privileges on such exchange or
listed for trading on the Nasdaq National Market System ("NMS"), the
current market value shall be the last reported sale price of the
Common Stock on such exchange on the last business day prior to the
date of exercise of this Warrant or if no such sale is made on such day
or no closing sale price is quoted, the average of the closing bid and
asked prices for such day on such exchange or system; or
(2) If the Common Stock is listed in the over-the-counter market
(other than on NMS) or admitted to unlisted trading privileges, the
current market value shall be the mean of the last reported bid and
asked prices reported by the National Quotation Bureau, Inc. on the
last business day prior to the date of the exercise of this Warrant; or
(3) If the Common Stock is not so listed or admitted to unlisted
trading privileges and bid and asked prices are not so reported, the
current market value shall be prescribed by the Board of Directors of
the Company.
SECTION 11. Warrantholders Not Deemed Stockholders. No holder of
--------------------------------------
Warrants shall, as such, be entitled to vote or to receive dividends or be
deemed the holder of Common Stock that may at any time be issuable upon exercise
of such Warrants for any purpose whatsoever, nor shall anything contained herein
be construed to confer upon the holder of Warrants, as such, any of the rights
of a stockholder of the Company or any right to vote for the election of
directors or upon any matter submitted to stockholders at any
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meeting thereof, or to give or withhold consent to any corporate action
(whether upon any recapitalization, issue or reclassification of stock, change
of par value or change of stock to no par value, consolidation, merger or
conveyance or otherwise), or to receive notice of meetings, or to receive
dividends or subscription rights, until such Holder shall have exercised such
Warrants and been issued shares of Common Stock in accordance with the
provisions hereof.
SECTION 12. Rights of Action. All rights of action with respect to this
Agreement are vested in the respective Registered Holders of the Warrants, and
any Registered Holder of a Warrant, without consent of the Warrant Agent or of
the holder of any other Warrant, may, on his own behalf and for his own benefit,
enforce against the Company his right to exercise his Warrants for the purchase
of shares of Common Stock in the manner provided in the Warrant Certificate
and this Agreement.
SECTION 13. Agreement of Warrantholders. Every holder of a Warrant, by
his acceptance thereof, consents and agrees with the Company, the Warrant Agent
and every other holder of a Warrant that:
(a) The Warrants are transferable only on the registry books of the
Warrant Agent by the Registered Holder thereof in person or by his attorney duly
authorized in writing and only if the Warrant Certificates representing such
Warrants are surrendered at the office of the Warrant Agent, duly endorsed or
accompanied by a proper instrument of transfer satisfactory to the Warrant Agent
and the Company in their sole discretion, together with payment of any
applicable transfer taxes; and
(b) The Company may deem and treat the person in whose name the Warrant
Certificate is registered as the holder and as the absolute, true and lawful
owner of the Warrants represented thereby for all purposes, and the Company
shall not be affected by any notice or knowledge to the contrary, except as
otherwise expressly provided in Section 7 hereof.
SECTION 14. Cancellation of Warrant Certificates. If the Company shall
purchase or acquire any Warrant or Warrants, the Warrant Certificate or Warrant
Certificates evidencing the same shall thereupon be cancelled by it and retired.
The Warrant Agent shall also cancel Common Stock following exercise of any or
all of the Warrants represented thereby or delivered to it for transfer, split
up, combination or exchange.
SECTION 15. Concerning the Warrant Agent. The Warrant Agent acts hereunder
as agent and in a ministerial capacity for the Company, and its duties shall be
determined solely by the provisions hereof. The Warrant Agent shall not, by
issuing and delivering Warrant Certificates or by any other act hereunder be
deemed to make any representations as to the validity, value or authorization of
the Warrant Certificates or the Warrants represented thereby or of any
securities or other property delivered upon exercise
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of any Warrant or whether any stock issued upon exercise of any Warrant is fully
paid and nonassessable.
The Warrant Agent shall account promptly to the Company with
respect to Warrants exercised and concurrently pay the Company, as provided in
Section 4, all moneys received by the Warrant Agent upon the exercise of such
Warrants. The Warrant Agent shall, upon request of the Company from time to
time, deliver to the Company such complete reports of registered ownership of
the Warrants and such complete records of transactions with respect to the
Warrants and the shares of Common Stock as the Company may request. The Warrant
Agent shall also make available to the Company and Paramount for inspection by
their agents or employees, from time to time as either of them may request, such
original books of accounts and record (including original Warrant Certificates
surrendered to the Warrant Agent upon exercise of Warrants) as may be maintained
by the Warrant Agent in connection with the issuance and exercise of Warrants
hereunder, such inspections to occur at the Warrant Agent's office as specified
in Section 17, during normal business hours.
The Warrant Agent shall not at any time be under any duty or
responsibility to any holder of Warrant Certificates to make or cause to be made
any adjustment of the Purchase Price provided in this Agreement, or to determine
whether any fact exists which may require any such adjustments, or with respect
to the nature or extent of any such adjustment, when made, or with respect to
the method employed in making the same. It shall not (i) be liable for any
recital or statement of facts contained herein or for any action taken, suffered
or omitted by it in reliance on any Warrant Certificate or other document or
instrument believed by it in good faith to be genuine and to have been signed or
presented by the proper party or parties, (ii) be responsible for any failure on
the part of the Company to comply with any of its covenants and obligations
contained in this Agreement or in any Warrant Certificate, or (iii) be liable
for any act or omission in connection with this Agreement except for its own
negligence or wilful misconduct.
The Warrant Agent may at any time consult with counsel
satisfactory to it (who may be counsel for the Company) and shall incur no
liability or responsibility for any action taken, suffered or omitted by it in
good faith in accordance with the written opinion or advice of such counsel.
Any notice, statement, instruction, request, direction, order or
demand of the Company shall be sufficiently evidenced by an instrument signed by
the Chairman of the Board, President, any Vice President, its Secretary, or
Assistant Secretary, (unless other evidence in respect thereof is herein
specifically prescribed). The Warrant Agent shall not be liable for any action
taken, suffered or omitted by it in accordance with such notice, statement,
instruction, request, direction, order or demand believed by it to be genuine.
The Company agrees to pay the Warrant Agent reasonable
compensation for its services hereunder and to reimburse it for its reasonable
expenses hereunder; it further
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agrees to indemnify the Warrant Agent and save it harmless against any and all
losses, expenses and liabilities, including judgments, costs and counsel fees,
for anything done or omitted by the Warrant Agent in the execution of its duties
and powers hereunder except losses, expenses and liabilities arising as a result
of the Warrant Agent's negligence or wilful misconduct.
The Warrant Agent may resign its duties and be discharged from all further
duties and liabilities hereunder (except liabilities arising as a result of the
Warrant Agent's own negligence or wilful misconduct), after giving 30 days'
prior written notice to the Company. At least 15 days prior to the date such
resignation is to become effective, the Warrant Agent shall cause a copy of such
notice of residnation to be mailed to the Registered Holder of each Warrant
Certificate at the Company's expense. Upon such resignation, or any inability of
the Warrant Agent to act as such hereunder, the Company shall appoint a new
warrant agent in writing. If the Company shall fail to make such appointment
within a period of 15 days after it has been notified in writing of such
resignation by the resigning Warrant Agent, then the Registered Holder of any
Warrant Certificate may apply to any court of competent jurisdiction for the
appointment of a new warrant agent. Any new warrant agent, whether appointed by
the Company or by such a court, shall be a bank or trust company having a
capital and surplus, as shown by its last published report to its stockholders,
of not less than $10,000,000 or a stock transfer company. After acceptance in
writing of such appointment by the new warrant agent is received by the Company,
such new warrant agent shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named herein as the Warrant Agent,
without any further assurance, conveyance, act or deed; but if for any reason it
shall be necessary or expedient to execute and deliver any further assurance,
conveyance, act or deed, the same shall be done at the expense of the Company
and shall by legally and validly executed and delivered by the resigning Warrant
Agent. Not later than the effective date of any such appointment the Company
shall file notice thereof with the resigning Warrant Agent and shall forthwith
cause a copy of such notice to be mailed to the Registered Holder of each
Warrant Certificate.
Any corporation into which the Warrant Agent or any new warrant agent may
be converted or merged or any corporation resulting from any consolidation to
which the Warrant Agent or any new warrant agent shall be a party or any
corporation succeeding to the trust business of the Warrant Agent shall be a
successor warrant agent under this Agreement without any further act, provided
that such corporation is eligible for appointment as successor to the Warrant
Agent under the provisions of the preceding paragraph. Any such successor
warrant agent shall promptly cause notice of its succession as warrant agent to
be mailed to the Company and to the Registered Holder of each Warrant
Certificate.
The Warrant Agent, its subsidiaries and affiliates, and any of its or
their officers or directors, may buy and hold or sell Warrants or other
securities of the Company and otherwise deal with the Company in the same manner
and to the same extent and with like effects as though it were not Warrant
Agent. Nothing herein shall preclude the Warrant Agent from acting in any other
capacity for the Company or for any other legal entity.
17
<PAGE>
SECTION 16. Modification of Agreement. The parties hereto may
-------------------------
by supplemental agreement make any changes or corrections in this Agreement (i)
that it shall deem appropriate to cure any ambiguity or to correct any defective
or inconsistent provision or manifest mistake or error herein contained; (ii) to
reflect an increase in the number of Warrants which are to be governed by this
Agreement resulting from an increase in the size of the Private Placement; or
(iii) that it may deem necessary or desirable and which shall not adversely
affect the interests of the holders of Warrant Certificates; provided however,
----------------
that this Agreement shall not otherwise be modified, supplemented or altered in
any respect except with the consent in writing of the Registered Holders of
Warrant Certificates representing not less than 50% of the Warrants then
outstanding; and provided, further, that no change in the number or nature of
-----------------
the securities purchasable upon the exercise of any Warrant, or the Purchase
Price therefor, or the acceleration of the Warrant Expiration Date, shall be
made without the consent in writing of the Registered Holder of the Warrant
Certificate representing such Warrant, other than such changes as are
specifically prescribed by this Agreement as originally executed.
SECTION 17. Notices. All notices, requests, consents and other
-------
communications hereunder shall be in writing and shall be deemed to have been
made when delivered or mailed first class registered or certified mail, postage
prepaid as follows: if to the Registered Holder of a Warrant Certificate, at the
address of such holder as shown on the registry books maintained by the Warrant
Agent; if to the Company, at Reservoir Place, 1601 Trapelo Road, Waltham, MA,
02154, if to the Warrant Agent, at J.A.F. Building, P.O. Box 3068, New York, NY,
10116-3068 and if to Paramount, at 375 Park Avenue, 15th Floor, New York, New
York 10152. Attention: Michael S. Weiss.
SECTION 18. Governing Law. This Agreement shall be governed by
-------------
and construed in accordance with the laws of the State of New York, without
reference to its principles of conflict of laws.
SECTION 19. Binding Effect. This Agreement shall be binding
--------------
upon and inure to the benefit of the Company and the Warrant Agent (and their
respective successors and assigns) and the holders from time to time of Warrant
Certificates. Nothing in this Agreement is intended or shall be construed to
confer upon any other person any right, remedy or claim, in equity or at law, or
to impose upon any other person any duty, liability or obligation.
SECTION 20. Termination. This Agreement shall terminate on the
-----------
earlier to occur of (i) the close of business on the Expiration Date of all the
Warrants; (ii) the date upon which all Warrants have been exercised.
SECTION 21. Counterparts. This Agreement may be executed in
------------
several counterparts, which taken together shall constitute a single document.
18
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
BOSTON LIFE SCIENCES, INC.
By:
------------------------------
Name:
Title:
PARAMOUNT CAPITAL, INC.,
By:
------------------------------
Name:
Title:
[ ]
By:
------------------------------
Name:
Title:
19
<PAGE>
THIS WARRANT AND ANY SHARES OF COMMON STOCK ISSUABLE UPON ITS EXERCISE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT") AND MAY NOT BE
TRANSFERRED UNTIL (1) A REGISTRATION STATEMENT UNDER THE ACT SHALL HAVE BECOME
EFFECTIVE WITH RESPECT THERETO, OR (2) RECEIPT BY THE ISSUER OF AN OPINION OF
COUNSEL REASONABLE SATISFACTORY TO THE ISSUER TO THE EFFECT THAT REGISTRATION
UNDER THE ACT IS NOT REQUIRED IN CONNECTION WITH SUCH PROPOSED TRANSFER NOR IS
SUCH TRANSFER IN VIOLATION OF ANY APPLICABLE STATE SECURITIES LAWS.
No. Warrants
VOID AFTER [ ], 2005
WARRANT CERTIFICATE FOR PURCHASE
OF COMMON STOCK
BOSTON LIFE SCIENCES, INC.
This certifies that FOR VALUE RECEIVED __________________________________
___________________________ or registered assigns (the "Registered Holder") is
the owner of the number of Warrants ("Warrants") specified above. Each Warrant
initially entitles the Registered Holder to purchase, subject to the terms and
conditions set forth in this Certificate and the Warrant Agreement (as
hereinafter defined), one fully paid and nonassessable share of Common Stock,
$.02 par value ("Common Stock"), of BOSTON LIFE SCIENCES, INC., a Delaware
Corporation (the "Company"), at any time commencing [ ], 1995 and prior to the
Expiration Date (the "Company"), at any time commencing [ ], 1995 and prior to
the Expiration (as hereinafter defined), upon the presentation and surrender of
this Warrant Certificate with the Subscription Form on the reverse hereof duly
executed, at the corporate office of, as Warrant Agent, or its successor (the
"Warrant Agent"), accompanied by payment of an amount equal to the lesser of (a)
$1.00 per share and (b) the average closing bid price of the Common Stock of
Nasdaq for the thirty consecutive trading days immediately preceding the Closing
Date on which such Warrants are issued (the "Purchase Price") in lawful money of
the United States of America in cash or by official bank or certified check made
payable to Boston Life Sciences, Inc. The Company may, at its election, reduce
the Purchase Price.
This Warrant Certificate and each Warrant represented hereby are issued
pursuant to and are subject in all respects to the terms and conditions set
forth in the Warrant Agreement (the "Warrant Agreement"), dated September ___,
1995 by and among the Company, the Warrant Agent and Paramount Capital, Inc.
1
<PAGE>
In the event of certain contingencies provided for in the Warrant
Agreement, the Purchase Price or the number of shares of Common Stock subject to
purchase upon the exercise of each Warrant represented hereby are subject to
modification or adjustment.
Each Warrant represented hereby is exercisable at the option of
the Registered Holder, but no fractional shares of Common Stock will be issued.
In the case of the exercise of less than all the Warrants represented hereby,
the Company shall cancel this Warrant Certificate upon the surrender hereof and
shall execute and deliver a new Warrant Certificate or Warrant Certificates of
like tenor, which the Warrant Agent shall countersign, for the balance of such
Warrants.
The term "Expiration Date" shall mean 5:00 P.M. (New York time)
on [ ], 2005. If such date shall in the State of New York be a holiday or a day
on which the banks are authorized to close, then the Expiration Date shall mean
5:00 P.M. (New York time) the next following day which in the State of New York
is not a holiday or a day on which banks are authorized to close. The Company
may, at its election, extend the Expiration Date.
The Warrant is not redeemable at the option of the company prior
to [ ], 1996. The Warrants may be redeemed at the election of the Company, in
whole but not in part, at any time on or after [ ], 1996, at $.10 per Warrant
(the "Redemption Price") provided that either (i) the closing bid quotation for
the Common Stock as reported on Nasdaq, or on such other exchange on which the
Common Stock is then traded, exceeds 200% of the Purchase Price for twenty (20)
consecutive trading days ending three days prior to the date of redemption.
This Warrant Certificate is exchangeable, upon the surrender
hereof by the Registered Holder at the corporate office of the Warrant Agent,
for a new Warrant Certificate or Warrant Certificates of like tenor representing
an equal aggregate number of Warrants, each of such new Warrant Certificates to
represent such number of Warrants as shall be designated by such Registered
Holder at the time of such surrender. Upon due presentment with any tax or other
governmental charge imposed in connection therewith, for registration of
transfer of this Warrant Certificate at such office, a new Warrant Certificate
or Warrant Certificates representing an equal aggregate number of Warrants will
be issued to the transferee in exchange therefor, subject to the limitations
provided in the Warrant Agreement.
Prior to the exercise of any Warrant represented hereby, the
Registered Holder shall not be entitled to any limitation, the right to vote or
to receive dividends or other distributions, and shall not be entitled to
received any notice of any proceedings of the Company, except as provided in the
Warrant Agreement.
Prior to due presentment for registration of transfer hereof, the
Company may deem and treat the Registered Holder as the absolute owner hereof
and of each Warrant
2
<PAGE>
represented hereby (notwithstanding any notations of ownership or writing hereon
made by anyone other than a duly authorized officer of the Company) for all
purposes and shall not be affected by any notice of the contrary.
This Warrant Certificate shall be governed by and construed in accordance
with the laws of the State of New York without reference to its principles of
conflict of laws.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be
duly executed, manually or in facsimile by two of its officers thereunto duly
authorized and a facsimile of its corporate seal to be imprinted hereon.
BOSTON LIFE SCIENCES, INC.
Dated: [ ], 1995
By _______________________________
Name: S. David Hillson
Title: President
[seal]
_______________________________
Name: Steve H. Kanzer
Title: Secretary
[ ]
By _______________________________
Name:
Title:
<PAGE>
SUBSCRIPTION FORM
To Be Executed by the Registered Holder
in Order to Exercise Warrants
The undersigned Registered Holder hereby irrevocably elects to exercise
_____________ Warrants represented by this Warrant Certificate, and to purchase
the securities issuable upon the exercise of such Warrants, and requests that
certificates for such securities shall be issued in the name of
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER
[please print or type name and address]
and be delivered to
[please print or type name and address]
and if such number of Warrants shall not be all the Warrants evidenced by this
Warrant Certificate, that a new Warrant Certificate for the balance of such
Warrants be registered in the name of, and delivered to, the Registered Holder
at the address stated below.
4
<PAGE>
The undersigned represents that the exercise of the within Warrant was
solicited by a member of the National Association of Securities Dealers, Inc.
If not solicited by an NASD member, please write "unsolicited" in the space
below. Unless otherwise indicated by listing the name of another NASD member
firm, it will be assumed that the exercise was solicited by Paramount Capital,
Inc.
-------------------------------------
(Name of NASD Member if other
than Paramount Capital, Inc.)
Dated:_________
-------------------------------------
-------------------------------------
-------------------------------------
Address
-------------------------------------
Taxpayer Identification Number
- ------------------------
Signature Guaranteed
- ------------------------
5
<PAGE>
ASSIGNMENT
To Be Executed by the Registered Holder
in Order to Assign Warrants
FOR VALUE RECEIVED, hereby sell, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER
[please print or type name and address]
of the Warrants represented by this Warrant Certificate, and hereby
irrevocably constitutes and appoints
Attorney to transfer this Warrant
Certificate on the books of the Company, with full power of substitution in the
premises.
Dated:
X
Signature Guaranteed
THE SIGNATURE TO THE ASSIGNMENT OR THE SUBSCRIPTION FORM MUST CORRESPOND TO THE
NAME AS WRITTEN UPON THE FACE OF THIS WARRANT CERTIFICATE IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER, AND MUST BE
GUARANTEED BY A COMMERCIAL BANK OR TRUST COMPANY OR A MEMBER FIRM OF THE
AMERICAN STOCK EXCHANGE, NEW YORK STOCK EXCHANGE, PACIFIC STOCK EXCHANGE OR
MIDWEST STOCK EXCHANGE.
6
<PAGE>
[Letterhead of Price Waterhouse L.L.P. Appears Here]
EXHIBIT 23.2
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report dated
March 4, 1996, which appears on page FS-2 of Boston Life Sciences, Inc's Annual
Report on Form 10-K for the year ended December 31, 1995. We also consent to
the reference to us under the heading "Experts" in such Prospectus.
/s/ Price Waterhouse LLP
PRICE WATERHOUSE LLP
Boston, Massachusetts
May 10, 1996
<PAGE>
EXHIBIT 23.3
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Boston Life Sciences, Inc. on Form S-3 of the report of Deloitte & Touche LLP
dated January 31, 1989 with respect to the statements of operations,
stockholders' equity and cash flows of Greenwich Pharmaceuticals Incorporated
(the "Company") for the period of inception (February 1969) to December 31, 1988
appearing in the Annual Report on Form 10-K/A of Greenwich Pharmaceuticals
Incorporated for the year ended December 31, 1994, as amended by Form 10-K/A.
Such report contains an explanatory paragraph that states that the ultimate
success of the Company's development program is dependent upon future events,
the outcome of which is currently undeterminable, and is also dependent upon
obtaining financing adequate to fulfill its development activities and achieving
a level of revenues adequate to support the Company's cost structure. We also
consent to the reference to us under the headings "Experts" in such prospectus.
/s/ DELOITTE & TOUCHE LLP
DELOITTE & TOUCHE LLP
Philadelphia, Pennsylvania
May 10, 1996
<PAGE>
ARTHUR ANDERSEN LLP
EXHIBIT 23.4
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
-----------------------------------------
As independent public accountants, we hereby consent to the incorporation by
reference in the Boston Life Sciences, Inc. Amendment No. 1 to Form S-3
Registration Statement of our report dated February 24, 1995 (except with
respect to the matters discussed in Note 12, as to which the date is June 15,
1995) included in the Greenwich Pharmaceuticals Incorporated's Form 10-K, as
amended, for the three years in the period ended December 31, 1994 and to all
references to our Firm included in this registration.
/s/ Arthur Andersen LLP
Philadelphia, PA
May 10, 1996
