Exhibit 10.60

 

Warrant Agreement

 

Warrant to Eli Lilly and Company for the Purchase of Shares of Common Stock of

Antares Pharma, Inc.,

$.01 par value per Share

 

Between Antares Pharma, Inc. (the “Company”), a Minnesota corporation, with its
principal place of business at 707 Eagleview Boulevard, Suite 414, Exton,
Pennsylvania 19341, and Eli Lilly and Company (“the Holder”), an Indiana
corporation, with its principal place of business at Lilly Corporate Center,
Indianapolis, Indiana, 46285.

 

Whereas, the Company and the Holder on this same date are entering into that
certain License Agreement pursuant to which the Holder shall acquire certain
rights to the Company’s needle free injection technology; and

 

Whereas, the License Agreement requires the Company to grant to the Holder the
right to acquire, under the terms and conditions set forth in this Warrant
Agreement, shares of the Company’s common stock; and

 

Whereas, the exercise price of the warrants provided herein, subject to
adjustment as provided herein, was determined by multiplying the average closing
price of Antares common stock over the last twenty trading days prior to the
signing of the License Agreement by a factor of two;

 

Therefore, for good and valuable consideration, the sufficiency of which is
hereby acknowledged by both parties, Antares and Lilly agree to the following
terms:

 

THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE THEREOF MAY
NOT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“ACT”), OR ANY STATE SECURITIES LAWS, AND MAY NOT BE SOLD, OFFERED FOR SALE,
PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED UNLESS THERE IS (i) AN EFFECTIVE
REGISTRATION STATEMENT UNDER SUCH ACT RELATED THERETO, OR (ii) AN OPINION OF
COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.

 

THIS Warrant Agreement CERTIFIES that, for value received, Holder is entitled to
subscribe for and purchase from the Company, upon the terms and conditions set
forth herein, at any time or from time to time after the date hereof, and before
5:00 P.M. on September 12, 2013, Pennsylvania time (the “Exercise Period”), one
million (1,000,000) shares of the Company’s Common Stock, $.01 par value
(“Common Stock”), at a price per share of $3.776 (the “Exercise Price”). This
Warrant may be transferred in whole or in part without restriction. The term the
“Holder” as used herein shall include any transferee to whom this Warrant has
been transferred in accordance with the above. The number of shares of Common
Stock issuable upon exercise of the Warrants (the “Warrant

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Shares”) and the Exercise Price may be adjusted from time to time as hereinafter
set forth.

 

1. Right to Exercise

This Warrant may be exercised by the Holder or its appropriate transferee during
the Exercise Period, as to the whole or any lesser number of whole Warrant
Shares, by the surrender of this Warrant (with the election at the end hereof
duly executed) to the Company at its office at 707 Eagleview Boulevard, Suite
414, Exton, Pennsylvania 19341, or at such other place as is designated in
writing by the Company, together with a certified or bank cashier’s check
payable to the order of the Company in an amount equal to the Exercise Price
multiplied by the number of Warrant Shares for which this Warrant is being
exercised (the “Stock Purchase Price”).

 

2. Conversion Right

(a) In lieu of the payment of the Stock Purchase Price, the Holder shall have
the right (but not the obligation), to require the Company to convert this
Warrant, in whole or in part, into shares of Common Stock (the “Conversion
Right”) as provided for in this Section 2. Upon exercise of the Conversion
Right, the Company shall deliver to the Holder (without payment by the Holder of
any of the Stock Purchase Price) that number of shares of Common Stock (the
“Conversion Shares”) equal to the quotient obtained by dividing (x) the value of
this Warrant (or portion thereof as to which the Conversion Right is being
exercised if the Conversion Right is being exercised in part) at the time the
Conversion Right is exercised (determined by subtracting the aggregate Stock
Purchase Price of the shares of Common Stock as to which the Conversion Right is
being exercised in effect immediately prior to the exercise of the Conversion
Right from the aggregate Current Market Price (as defined in Section 6(b)
hereof) of the shares of Common Stock as to which the Conversion Right is being
exercised immediately prior to the exercise of the Conversion Right) by (y) the
Current Market Price of one share of Common Stock immediately prior to the
exercise of the Conversion Right.

 

(b) The Conversion Rights provided under this Section 2 may be exercised in
whole or in part and at any time and from time to time while any part of the
Warrants remain outstanding. In order to exercise the Conversion Right, the
Holder shall surrender to the Company, at its offices, this Warrant with the
Notice of Conversion at the end hereof duly executed. The presentation and
surrender shall be deemed a waiver by the Company of the Holder’s obligation to
pay all or any portion of the aggregate purchase price payable for the shares of
Common Stock as to which such Conversion Right is being exercised. This Warrant
(or so much thereof as shall have been surrendered for conversion) shall be
deemed to have been converted immediately prior to the close of business on the
day of surrender of such Warrant for conversion in accordance with the foregoing
provisions.

 

3. Holder of Record and Partial Exercises

Upon each exercise of the Holder’s rights to purchase Warrant Shares or
Conversion Shares, the Holder shall be deemed to be the holder of record of the
Warrant Shares or Conversion Shares issuable upon such exercise or conversion,
notwithstanding that the

 

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transfer books of the Company shall then be closed or certificates representing
such Warrant Shares or Conversion Shares shall not then have been actually
delivered to the Holder. As soon as practicable after each such exercise or
conversion of this Warrant, the Company shall issue and deliver to the Holder a
certificate or certificates for the Warrant Shares or Conversion Shares issuable
upon such exercise or conversion, registered in the name of the Holder or its
designee. If this Warrant should be exercised or converted in part only, the
Company shall, upon surrender of this Warrant for cancellation, execute and
deliver a new Warrant evidencing the right of the Holder to purchase the balance
of the Warrant Shares (or portions thereof) or to convert the balance of the
Conversion Shares in accordance with provisions of this Agreement.

 

4. Warrant Register and Transfers

The Company shall maintain books for the ownership, transfer and registration of
the Warrant in a Warrant Register. Any future Warrants issued as a result of the
transfer or exercise or conversion in part of this Warrant shall be numbered and
shall be registered in the Warrant Register as they are issued. The Company
shall be entitled to treat the registered holder of any Warrant on the Warrant
Register as the owner in fact thereof for all purposes and shall not be bound to
recognize any equitable or other claim to or interest in such Warrant on the
part of any other person, and shall not be liable for any registration or
transfer of Warrants which are registered or to be registered in the name of a
fiduciary or the nominee of a fiduciary unless made with the actual knowledge
that a fiduciary or nominee is committing a breach of trust in requesting such
registration or transfer, or with the knowledge of such facts that its
participation therein amounts to bad faith. This Warrant shall be transferable
only on the books of the Company upon delivery thereof duly endorsed by the
Holder or by the Holder’s duly authorized attorney or representative, or
accompanied by proper evidence of succession, assignment, or authority to
transfer. Upon any registration of transfer, the Company shall deliver a new
Warrant or Warrants to the person entitled thereto. Notwithstanding the
foregoing, the Company shall have no obligation to cause Warrants to be
transferred on its books to any person unless and until the Holder delivers an
opinion of Holder’s outside counsel that such transfer does comply with the
provisions of the Securities Act of 1933, as amended, and the rules and
regulations thereunder.

 

5. Reservation of Authorized Shares

The Company shall at all times reserve and keep available out of its authorized
but unissued shares of Common Stock, solely for the purpose of providing for the
exercise of the Warrants, such number of shares of Common Stock as shall from
time to time equal the number of shares sufficient to permit the exercise of the
Warrants in accordance with their respective terms. The Company covenants that
all shares of Common Stock issuable upon exercise of this Warrant, upon receipt
by the Company of the full Exercise Price therefor, and all shares of Common
Stock issuable upon conversion of this Warrant, shall be validly issued, fully
paid, and nonassessable, without any personal liability attaching to the
ownership thereof, and will not be issued in violation of any preemptive rights
of stockholders, optionholders, warrantholders or any other persons and the
Holder will receive good title to the securities purchased by it, free and clear
of all liens, security

 

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interests, pledges, charges, encumbrances, stockholders’ agreements and voting
trusts which might be created by acts or omissions to act of the Company.

 

6. Warrant Price Computation Adjustments to the Number of Shares and the
Exercise Price

 

(a) In case the Company shall at any time after the date the Warrants were first
issued engage in any transaction, or act in any way, to affect the capital
structure of the Company, including but not limited to the following specific
scenarios in subsections(a)(i)-(vii) below, (a “Capital Transaction”), wherein
the Company:

 

(i) declares a dividend on the outstanding Common Stock payable in shares of its
capital stock;

(ii) divides or subdivides the outstanding Common Stock;

(iii) combines the outstanding Common Stock into a smaller number of shares, or

(iv) issues any shares of its capital stock by reclassification of the Common
Stock (including any such reclassification in connection with a consolidation or
merger in which the Company is the continuing corporation);

(v) exchanges Common Stock for the securities of a new entity pursuant to a
consolidation or merger; or

(vi) issues debt instruments to holders of Common Stock generally;

 

then the Exercise Price shall be adjusted proportionately and the number and
kind of securities issuable upon exercise or conversion of this Warrant shall be
adjusted proportionately so that the Holder after such Capital Transaction shall
be entitled to receive the aggregate number, overall value and kind of shares
which, if such Warrant had been exercised or converted immediately prior to such
time, the Holder would have owned upon such exercise or conversion and been
entitled to receive by virtue of such Capital Transaction, all in accordance
with the provisions of this Section 6. Such adjustment shall be made
successively whenever any Capital Transaction shall occur.

 

(b) For the purpose of any computation under this Warrant, the Current Market
Price per share of Common Stock on any date shall be deemed to be the average of
the daily closing prices for the twenty (20) consecutive trading days
immediately preceding the date in question. The closing price for each day shall
be the last reported sales price regular way or, in case no such reported sale
takes place on such day, the closing bid price regular way, in either case on
the principal national securities exchange (including, for purposes hereof, the
Nasdaq SmallCap Market) on which the Common Stock is listed or admitted to
trading or, if the Common Stock is not listed or admitted to trading on any
national securities exchange, the highest reported bid price for the Common
Stock as reported by a recognized interdealer quotation system or as furnished
by the National Association of Securities Dealers, Inc. through Nasdaq or a
similar organization if Nasdaq is no longer reporting such information. If on
any such date the Common Stock is not listed or admitted to trading on any
national securities exchange and is not quoted by Nasdaq or any similar
organization, the fair value of a share of Common Stock on such date, as
determined in good faith by a nationally recognized investment banking

 

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firm selected by mutual agreement of the parties, whose determination shall be
conclusive absent manifest error, shall be used.

 

(c) No adjustment in the Exercise Price shall be required if such adjustment is
less than $.05; provided, however, that any adjustments which by reason of this
Section 6 are not required to be made shall be carried forward and taken into
account in any subsequent adjustment. All calculations under this Section 6
shall be made to the nearest cent or to the nearest one-thousandth of a share,
as the case may be.

 

(d) In any case in which this Section 6 shall require that an adjustment in the
Exercise Price be made effective as of a record date for a specified event, the
Company may elect to defer, until the occurrence of such event and after such
record date, issuing to the Holder, if the Holder exercised or converted this
Warrant, those shares of Common Stock, if any, issuable upon such exercise or
conversion over and above the shares of Common Stock, if any, issuable upon such
exercise or conversion on the basis of the Exercise Price in effect prior to
such adjustment; provided, however, that in such case where the Company elects
such a deferral the Company shall deliver to the Holder a due bill or other
appropriate instrument evidencing the Holder’s right to receive such additional
shares upon the occurrence of the event requiring such adjustment.

 

(e) Whenever there shall be an adjustment provided in this Section 6, the
Company shall promptly cause written notice thereof to be sent by registered
mail or overnight courier, postage prepaid, to the Holder, at its address as it
shall appear in the Warrant Register, which notice shall be accompanied by an
officer’s certificate setting forth the number of Warrant Shares purchasable
upon the exercise of this Warrant and the Exercise Price after such adjustment
and setting forth a brief statement of the facts requiring such adjustment and
the computation thereof.

 

(f) The Company shall not be required to issue fractions of shares of Common
Stock or other capital stock of the Company upon the exercise or conversion of
this Warrant. If any fraction of a share would be issuable on the exercise or
conversion of this Warrant (or specified portions thereof), the Company shall
purchase such fraction for an amount in cash equal to the same fraction of the
Current Market Price of such share of Common Stock on the date of exercise or
conversion of this Warrant.

 

7. Merger

(a) In case of any consolidation with or merger of the Company with or into
another corporation (other than a merger or consolidation in which the Company
is the surviving or continuing corporation), or in case of any sale, lease, or
conveyance to another corporation of all or substantially all of the property
and assets of the Company, such successor, leasing, or purchasing corporation,
as the case may be, shall (i) execute with the Holder an agreement providing
that the Holder shall have the right thereafter to receive upon exercise or
conversion of this Warrant solely the kind and amount of shares of stock and
other securities, property, cash, or any combination thereof receivable upon
such consolidation, merger, sale, lease, or conveyance by a holder of the number
of shares of Common Stock for which this Warrant might have been exercised or
converted

 

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immediately prior to such consolidation, merger, sale, lease, or conveyance, and
(ii) make effective provision in its certificate of incorporation or otherwise,
if necessary, to effect such agreement. Such agreement shall provide for
adjustments which shall be as nearly equivalent as practicable to the
adjustments in Section 6.

 

(b) The above provisions of this Section 7 shall similarly apply to successive
reclassifications and changes of shares of Common Stock and to successive
consolidations, mergers, sales, leases, or conveyances.

 

8. Notice of Adjustments and Extraordinary Distributions to Shareholders

 

In case at any time the Company shall propose:

 

(i) to pay any dividend or make any distribution on shares of Common Stock in
shares of Common Stock or make any other distribution to all holders of Common
Stock; or

 

(ii) to issue any rights, warrants, or other securities to all holders of Common
Stock entitling them to purchase any additional shares of Common Stock or any
other rights, warrants, or other securities; or

 

(iii) to effect any Capital Transaction, including but not limited to
reclassification or change of outstanding shares of Common Stock, or any
consolidation, merger, sale, lease, or conveyance of property, as described in
Section 7; or

 

(iv) to effect any liquidation, dissolution, or winding-up of the Company; or.

 

(v) to take any other action which would cause an adjustment to the Exercise
Price;

 

then, and in any one or more of such cases, the Company shall give written
notice thereof, by registered mail, postage prepaid, to the Holder at the
Holder’s address as it shall appear in the Warrant Register, mailed at least 15
days prior to (i) the date as of which the holders of record of shares of Common
Stock (to be entitled to receive any such dividend, distribution, rights,
warrants, or other securities) are to be determined, (ii) the date on which any
such reclassification, change of outstanding shares of Common Stock,
consolidation, merger, sale, lease, conveyance of property, liquidation,
dissolution, or winding-up is expected to become effective, and the date as of
which it is expected that holders of record of shares of Common Stock shall be
entitled to exchange their shares for securities or other property, if any,
deliverable upon such reclassification, change of outstanding shares,
consolidation, merger, sale, lease, conveyance of property, liquidation,
dissolution, or winding-up, or (iii) the date of such action which would require
an adjustment to the Exercise Price.

 

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9. Payment of Taxes

 

The issuance of any shares or other securities upon the exercise or conversion
of this Warrant, and the delivery of certificates or other instruments
representing such shares or other securities, shall be made without charge to
the Holder for any tax or other charge in respect of such issuance. The Company
shall not, however, be required to pay any tax which may be payable in respect
of any transfer involved in the issue and delivery of any certificate in a name
other than that of the Holder and the Company shall not be required to issue or
deliver any such certificate unless and until the person or persons requesting
the issue thereof shall have paid to the Company the amount of such tax or shall
have established to the satisfaction of the Company that such tax has been paid.
The Holder and/or its transferee shall be responsible for income taxes due under
federal, state or other law, if any such tax is due.

 

10. Execution of Registration Rights Agreement

 

The Company shall execute simultaneous with this Warrant Agreement a
Registration Rights Agreement pursuant to which the Company shall register and
maintain throughout the term of this Warrant Agreement a shelf registration for
all shares of Common Stock subject to the Warrant granted herein in accordance
with the Securities Act of 1933. All expenses of such a registration shall be
borne by the Company.

 

11. No Restrictions on Shares Subject to the Warrant

 

The Shares of Common Stock issued upon exercise of the Warrants shall not be
subject to any contractual restrictions, and, once the shares issued pursuant to
exercise of the Warrant have been registered in accordance with the Registration
Rights Agreement and the Securities Act of 1933, shall be freely transferable.

 

12. Loss or Mutilation of Warrant

 

Upon receipt of evidence satisfactory to the Company of the loss, theft,
destruction, or mutilation of any Warrant (and upon surrender of any Warrant if
mutilated), and upon reimbursement of the Company’s reasonable incidental
expenses, the Company shall execute and deliver to the Holder thereof a new
Warrant of like date, tenor, and denomination.

 

13. Warrantholder Not a Shareholder Until Exercise

 

The Holder of any Warrant shall not have, solely on account of such status, any
rights of a shareholder of the Company, either at law or in equity, or to any
notice of meetings of stockholders or of any other proceedings of the Company,
except as provided in this Warrant Agreement.

 

14. Choice of Law and Forum Selection

 

This Warrant shall be construed in accordance with the laws of the State of
Deleware applicable to contracts made and performed within such State, without
regard to principles of conflicts of law.

 

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15. Waiver of Jury Trial

 

The Company and the Holder each hereby waives all right to trial by jury of any
claim, action, proceeding or counterclaim brought against the other party of any
issue related to the subject matter of this Agreement, of any dispute that
arises under or relates to this Agreement, or of any claim of injury or damage
of any and every kind whatsoever by one party against the other.

 

16. Injunctive Relief

 

The Company agrees that remedies at law of the Holder of this Warrant in the
event of any default or threatened default by the Company in the performance or
compliance with any of the terms of this Warrant are not and will not be
adequate and that such default or threatened default will result in irreparable
harm to the Holder, and that, to the fullest extent permitted by law, such terms
may be specifically enforced by a decree for the specific performance of any
provision of this Warrant Agreement or by an injunction against a violation of
any of the terms hereof. The provision of such equitable relief as contained in
the first sentence of this Section is not intended by the parties to be the
exclusive remedy for the Holder, and such other remedies, including legal
remedies, as may be appropriate to the situation, are and shall remain available
to the Holder to pursue.

 

17. Financial Statements

 

If at anytime the Company is not subject to the reporting requirements of the
Securities Exchange Act of 1934, the Company shall provide to Lilly, not later
than 30 days after the end of each quarter, unaudited quarterly financial
statements, and within 90 days of the end of each year, audited annual financial
statements prepared in accordance with generally accepted accounting principles,
consistently applied.

 

Dated as of: September 12, 2003

 

Antares Pharma, Inc.

By:

 

/s/    Roger Harrison        

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Name: Roger Harrison, Ph.D.

Title: President, Chief Executive Officer

        and Chairman of the Board of Directors

 

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FORM OF ASSIGNMENT

 

(To be executed by the registered holder if such holder desires to transfer the
attached Warrant.)

 

FOR VALUE RECEIVED, Eli Lilly and Company hereby sells, assigns, and transfers
unto                          a Warrant to purchase          shares of Common
Stock, $.01 per share, of Antares, Inc. (the “Company”), together with all
right, title, and interest therein, and does hereby irrevocably constitute and
appoint                  attorney to transfer such Warrant on the books of the
Company, with full power of substitution.

 

Dated:                                     

 

Eli Lilly and Company

 

By:                                         

Name:

Its:

 

NOTICE

 

The signature on the foregoing Assignment must correspond to the name as written
upon the face of this Warrant in every particular, without alteration or
enlargement or any change whatsoever.

 

To:   Antares Pharma, Inc.

707 Eagleview Boulevard, Suite 414

Exton, PA19341

 

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ELECTION TO EXERCISE

 

The undersigned hereby exercises his or its rights to purchase             
Warrant Shares covered by the within Warrant and tenders payment herewith in the
amount of $             in accordance with the terms thereof, and requests that
certificates for such securities be issued in the name of, and delivered to:

 

(Print Name, Address and Social Security

    or Tax Identification Number)

 

and, if such number of Warrant Shares shall not be all the Warrant Shares
covered by the within Warrant, that a new Warrant for the balance of the Warrant
Shares covered by the within Warrant be registered in the name of, and delivered
to, the undersigned at the address stated below.

 

Dated:                                     
                                                                                
  Name:                                         
                                                                               

(Print)

                                              
                                        
                                                      

(Signature)

       

 

Address:                                     
                                                                      

                                                        
                                        
                                                                 

To:   Antares Pharma, Inc.

707 Eagleview Boulevard, Suite 414

Exton, PA 19341

 

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CASHLESS EXERCISE FORM

 

(To be executed upon conversion of the attached Warrant)

 

The undersigned hereby irrevocably elects to surrender its Warrant for the
number of shares of Common Stock as shall be issuable pursuant to the cashless
exercise provisions of the within Warrant, in respect of              shares of
Common Stock underlying the within Warrant, and requests that certificates for
such securities be issued in the name of, and delivered to:

 

(Print Name, Address and Social Security

    or Tax Identification Number)

 

and, if such number of shares shall not be all the shares exchangeable or
purchasable under the within Warrant, that a new Warrant for the balance of the
Warrant Shares covered by the within Warrant be registered in the name of, and
delivered to, the undersigned at the address stated below.

 

Dated:                                     
                                                                                
  Name:                                         
                                                                               

(Print)

                                              
                                        
                                                      

(Signature)

       

 

Address:                                     
                                                                      

                                                        
                                        
                                                                 

 

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