EXHIBIT 10.4

 

THE WARRANT REPRESENTED BY THIS CERTIFICATE AND THE SHARES ISSUABLE UPON
EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAWS, AND NEITHER SUCH SECURITIES
NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR OTHERWISE
TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS
EFFECTIVE UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR (2) THE
COMPANY RECEIVES AN OPINION OF COUNSEL TO THE HOLDER OF SUCH SECURITIES, WHICH
COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH
SECURITIES MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR TRANSFERRED IN THE MANNER
CONTEMPLATED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR
APPLICABLE STATE SECURITIES LAWS.

 

BIOJECT MEDICAL TECHNOLOGIES INC.

 

WARRANT FOR THE PURCHASE OF          SHARES OF COMMON STOCK

 

Warrant No.

 

This Warrant Expires on September 7, 2010

 

THIS CERTIFIES that, for value received,                               , a
Delaware limited partnership, with an address at
                                    (including any permitted transferee, the
“Holder”), is the registered holder of this Warrant, which represents the right
to purchase                  fully paid and nonassessable shares of the common
stock, without par value (the “Common Stock”) of BIOJECT MEDICAL TECHNOLOGIES
INC., an Oregon corporation (the “Company”), at an initial exercise price equal
to $1.37 per share (subject to adjustment as provided herein) (the “Exercise
Price”) upon the terms and conditions set forth herein, at any time or from time
to time from March 8, 2006 until 5:00 P.M. on September 7, 2010, New York time
(the “Exercise Period”).

 

This Warrant is issued pursuant to that certain Note and Warrant Purchase
Agreement, dated as of March 8, 2006, by and among the Company and the entities
listed on Schedule 1 thereto (the “N&W Purchase Agreement”). As used herein, the
term “this Warrant” shall mean and include this Warrant and any Warrant or
Warrants hereafter issued as a consequence of the exercise or transfer of this
Warrant in whole or in part. The number of shares of Common Stock issuable upon
exercise of this Warrant (the “Warrant Shares”) and the Exercise Price may be
adjusted from time to time as hereinafter set forth. Capitalized terms used
herein without definition shall have the meanings assigned to such terms in the
N&W Purchase Agreement.

 

Pursuant to the terms of a Securities Purchase Agreement, dated the date hereof,
between the Company and the parties listed on Exhibit A thereto, the Company is
required to register the Warrant Shares for resale under the Securities Act of
1933, as amended, together with, and at the time, the securities offered and
sold by the Company in its next private offering and sale of equity securities
(including the Securities Offering (as defined in the N&W Purchase Agreement))
are so registered, and the Warrant Shares shall be Registrable Securities under
any registration rights or similar agreement entered into by the Company in
connection with any such offering of equity securities.

 

1.                                       Exercise of Warrant.

 

(a)                                  This Warrant may be exercised 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 the notice address set forth in paragraph 14 hereof
or at such other place as is designated in writing by the Company. Such executed
election must be accompanied by payment in an amount

 

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equal to the Exercise Price multiplied by the number of Warrant Shares for which
this Warrant is being exercised. Such payment may be made by certified or bank
cashier’s check payable to the order of the Company.

 

(b)                                 All or any part of this Warrant may be
exercised on a “cashless” basis, by stating in the Exercise Notice such
intention and the maximum number (the “Maximum Number”) of shares of Common
Stock the Holder desires to purchase in consideration of cancellation of
Warrants in payment for such exercise. The number of shares of Common Stock the
Holder shall receive (the “Cashless Exercise Number”) upon such exercise
pursuant to this Section 1(b) shall equal the quotient that is obtained when the
product of the Maximum Number and the difference between the Current Weighted
Market Price and the then current Exercise Price is divided by the then Current
Weighted Market Price per share (as hereinafter defined). The following is an
example of the determination of the Cashless Exercise Number:

 

X = Y(A-B)

A

 

Where                                                                                                                                   
X =                             the Cashless Exercise Number

 

Y =                              the Maximum Number

 

A =                            the Current Weighted Market Price of one share of
the Common Stock (at the date of such calculation)

 

B =                              the current Exercise Price (as adjusted to the
date of such calculation).

 

2.                                       Issuance of Certificates Upon Exercise.
Upon each exercise of the Holder’s rights to purchase Warrant Shares, the Holder
shall be deemed to be the holder of record of the Warrant Shares issuable upon
such exercise, notwithstanding that the transfer books of the Company shall then
be closed or certificates representing such Warrant Shares shall not then have
been actually delivered to the Holder. As soon as practicable after each such
exercise of this Warrant, the Company shall issue and deliver to the Holder a
certificate or certificates for the Warrant Shares issuable upon such exercise,
registered in the name of the Holder or its designee. If this Warrant should be
exercised 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)
subject to purchase hereunder.

 

3.                                       Transfer; Restrictions on Transfer;
Compliance with the Act; Registration Rights.

 

(a)                                  Any Warrants issued upon the transfer or
exercise in part of this Warrant shall be numbered and shall be registered in a
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 his duly authorized attorney
or representative, or accompanied by proper evidence of succession, assignment,
or authority to transfer. In all cases of transfer by an attorney, executor,
administrator, guardian, or other legal representative, duly authenticated
evidence of his or its authority shall be produced. Upon any registration of
transfer, the Company shall deliver a new Warrant or Warrants to the person
entitled thereto. This Warrant may be exchanged, at the option of the Holder
thereof, for another Warrant, or other Warrants of different denominations, of
like tenor and representing in the aggregate the

 

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right to purchase a like number of Warrant Shares (or portions thereof), upon
surrender to the Company or its duly authorized agent. Notwithstanding the
foregoing, the Company shall have no obligation to cause Warrants to be
transferred on its books to any person if, in the opinion of counsel to the
Company, such transfer does not comply with the provisions of the Act and the
rules and regulations thereunder.

 

(b)                                 The Holder acknowledges that the Holder has
been advised by the Company that neither this Warrant nor the Warrant Shares
have been registered under the Act, that this Warrant is being or has been
issued and the Warrant Shares may be issued on the basis of the statutory
exemption provided by Section 4(2) of the Act or Regulation D promulgated
thereunder, or both, relating to transactions by an issuer not involving any
public offering, and that the Company’s reliance thereon is based in part upon
the representations made by the original Holder in the Purchase Agreement. The
Holder acknowledges that he has been informed by the Company of, or is otherwise
familiar with, the nature of the limitations imposed by the Act and the
rules and regulations thereunder on the transfer of securities. In particular,
the Holder agrees that no sale, assignment or transfer of this Warrant or the
Warrant Shares issuable upon exercise hereof shall be valid or effective, and
the Company shall not be required to give any effect to any such sale,
assignment or transfer, unless (i) the sale, assignment or transfer of this
Warrant or such Warrant Shares is registered under the Act, it being understood
that neither this Warrant nor such Warrant Shares are currently registered for
sale and that the Company has no obligation or intention to so register this
Warrant or such Warrant Shares except as specifically referred to herein, or
(ii) this Warrant or such Warrant Shares are sold, assigned or transferred in
accordance with all the requirements and limitations of Rule 144 promulgated
under the Act, it being understood that Rule 144 is not available at the time of
the original issuance of this Warrant for the sale of this Warrant or such
Warrant Shares and that there can be no assurance that Rule 144 sales will be
available at any subsequent time, or (iii) such sale, assignment, or transfer is
otherwise exempt from registration under the Act.

 

4.                                       Nonassessable Reservation of Shares.
The Company shall at all times reserve and keep available out of its authorized
and unissued Common Stock, solely for the purpose of providing for the exercise
of the rights to purchase all Warrant Shares granted pursuant to this Warrant,
such number of shares of Common Stock as shall, from time to time, be sufficient
therefor. 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, shall be validly issued, fully paid, nonassessable, and free of
preemptive rights.

 

5.                                       Adjustment of Exercise Price and Number
of Warrant Shares.

 

(a)                                  In case the Company shall at any time after
the date this Warrant was first issued (i) declare a dividend on the outstanding
Common Stock payable in shares of its capital stock, (ii) subdivide the
outstanding Common Stock, (iii) combine the outstanding Common Stock into a
smaller number of shares, or (iv) issue 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), then, in each case, the Exercise Price, and the number of Warrant
Shares issuable upon exercise of this Warrant, in effect at the time of the
record date for such dividend or of the effective date of such subdivision,
combination, or reclassification, shall be proportionately adjusted so that the
Holder after such time shall be entitled to receive the aggregate number and
kind of shares which, if such Warrant had been exercised immediately prior to
such time, the Holder would have owned upon such exercise and been entitled to
receive by virtue of such dividend, subdivision, combination, or
reclassification. Such adjustment shall be made successively whenever any event
listed above shall occur.

 

(b)                                 In case the Company shall issue or fix a
record date for the issuance to all holders of Common Stock of rights, options,
or warrants to subscribe for or purchase Common Stock (or securities convertible
into or exchangeable for Common Stock) at a price per share (or having a
Conversion or exchange price per share, if a security convertible into or
exchangeable for Common Stock) less than the Current Weighted Market Price (as
hereinafter defined) per share of Common Stock on such record date, then, in
each case, the Exercise Price shall be adjusted by multiplying the Exercise
Price in effect immediately prior to such record date by a fraction, the

 

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numerator of which shall be the number of shares of Common Stock outstanding on
such record date plus the number of shares of Common Stock which the aggregate
offering price of the total number of shares of Common Stock so to be offered
(or the aggregate initial conversion or exchange price of the convertible or
exchangeable securities so to be offered) would purchase at such Current
Weighted Market Price and the denominator of which shall be the number of shares
of Common Stock outstanding on such record date plus the number of additional
shares of Common Stock to be offered for subscription or purchase (or into which
the convertible or exchangeable securities so to be offered are initially
convertible or exchangeable); provided, however, that no such adjustment shall
be made which results in an increase in the Exercise Price and every adjustment
shall be subject to Section 5(f) hereof. Such adjustment shall become effective
at the close of business on such record date; provided, however, that, to the
extent the shares of Common Stock (or securities convertible into or
exchangeable for shares of Common Stock) are not delivered, the Exercise Price
shall be readjusted after the expiration of such rights, options, or warrants
(but only with respect to Warrants exercised after such expiration), to the
Exercise Price which would then be in effect had the adjustments made upon the
issuance of such rights, options, or warrants been made upon the basis of
delivery of only the number of shares of Common Stock (or securities convertible
into or exchangeable for shares of Common Stock) actually issued. In case any
subscription price may be paid in consideration part or all of which shall be in
a form other than cash, the value of such consideration shall be as determined
in good faith by the board of directors of the Company, whose determination
shall be conclusive absent manifest error. Shares of Common Stock owned by or
held for the account of the Company or any majority-owned subsidiary shall not
be deemed outstanding for the purpose of any such computation.

 

(c)                                  In case the Company shall distribute to all
holders of Common Stock (including any such distribution made to the
stockholders of the Company in connection with a consolidation or merger in
which the Company is the continuing corporation) evidences of its indebtedness,
cash (other than any cash dividend which, together with any cash dividends paid
within the 12 months prior to the record date for such distribution, does not
exceed 5% of the Current Weighted Market Price at the record date for such
distribution) or assets (other than distributions and dividends payable in
shares of Common Stock), or rights, options, or warrants to subscribe for or
purchase Common Stock, or securities convertible into or changeable for shares
of Common Stock (excluding those with respect to the issuance of which an
adjustment of the Exercise Price is provided pursuant to Section 5(b) hereof),
then, in each case, the Exercise Price shall be adjusted by multiplying the
Exercise Price in effect immediately prior to the record date for the
determination of stockholders entitled to receive such distribution by a
fraction, the numerator of which shall be the Current Weighted Market Price per
share of Common Stock on such record date, less the fair market value (as
determined in good faith by the board of directors of the Company, whose
determination shall be conclusive absent manifest error) of the portion of the
evidences of indebtedness or assets so to be distributed, or of such rights,
options, or warrants or convertible or exchangeable securities, or the amount of
such cash, applicable to one share, and the denominator of which shall be such
Current Weighted Market Price per share of Common Stock. Such adjustment shall
become effective at the close of business on such record date.

 

(d)                                 For the purpose of any computation under
this Agreement, the “Current Weighted Market Price” per share of Common Stock on
any date shall be deemed to be the arithmetic average of the daily VWAPs per
share of the Common Stock on the Principal Market for the 20 consecutive Trading
Days ending on and including the Trading Day immediately prior to the date in
question. If the Current Weighted Market Price cannot be determined under the
foregoing method, the Current Weighted Market Price shall mean the fair value
per share of Common Stock on such date as determined by the Board of Directors
in good faith, irrespective of any accounting treatment.

 

(e)                                  No adjustment in the Exercise Price shall
be required if such adjustment is less than $.01 (which amount will be
proportionately adjusted in the event of stock splits or the like); provided,
however, that any adjustments which by reason of this Section 5 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.

 

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(f)                                    In any case in which this Section 5 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, issuing to the Holder, if the Holder exercised this
Warrant after such record date, the shares of Common Stock, if any, issuable
upon such exercise over and above the shares of Common Stock, if any, issuable
upon such exercise on the basis of the Exercise Price in effect prior to such
adjustment; provided, however, that 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.

 

(g)                                 Whenever there shall be an adjustment as
provided in this Section 5, the Company shall promptly cause written notice
thereof to be sent by certified or registered mail, 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, which officer’s
certificate shall be conclusive evidence of the correctness of any such
adjustment absent manifest error.

 

(h)                                 The Company shall not be required to issue
fractions of shares of Common Stock or other capital stock of the Company upon
the exercise of this Warrant. If any fraction of a share would be issuable on
the exercise 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
market price of such share of Common Stock on the date of exercise of this
Warrant, as determined in good faith by the Company’s Board of Directors.

 

(i)                                     Principal Market means whichever of
(a) the national securities exchange, (b) the Nasdaq Stock Market, or (c) such
other securities market on which the Common Stock is listed for trading which at
such time constitutes the principal securities market for the Common Stock.

 

(j)                                     Trading Day means a day on whichever of
(a) the national securities exchange, (b) the Nasdaq Stock Market, or (c) such
other securities markets, in any case which at the time constitutes the
Principal Market for the Common Stock, is open for general trading of
securities.

 

(k)                                  VWAP of the Common Stock on any Trading Day
means the volume-weighted average price of the Common Stock on the Principal
Market, as reported by Bloomberg Financial, L.P. (based on a Trading Day from
9:30 a.m., Eastern Time, to 4:00 p.m., Eastern Time, using the AQR function, for
such Trading Day; provided, however, if the volume-weighted average price of the
Common Stock on the Principal Market is not reported by Bloomberg Financial,
L.P., it will be determined by (a) using all regular way trades (including sold
sales and late sales) reported by the appropriate reporting authority from
9:30 a.m., Eastern Time, to 4:00 p.m., Eastern Time, (b) multiplying each
respective reported price by the total number of shares traded at that price,
(c) adding together each of these calculated values to compile an aggregate sum,
and (d) dividing the aggregate sum by the total number of reported shares that
appear in the prints included in step (a); and provided, further, during any
period the VWAP is being determined, the VWAP shall be subject to equitable
adjustments from time to time on terms consistent with Section 5 and otherwise
reasonably acceptable to the Purchaser Majority Interest for (s) stock splits,
(t) stock dividends, (u) combinations, (v) capital reorganizations, (w) issuance
to all holders of Common Stock of rights or warrants to purchase shares of
Common Stock, (x) distribution by the Company to all holders of Common Stock of
evidences of indebtedness of the Company or cash (other than regular quarterly
dividends), (y) tender offers by the Company or any subsidiary for, or other
repurchases of shares of, Common Stock in one or more transactions which,
individually or in the aggregate, result in the purchase of more than ten
percent of the Common Stock outstanding, and (z) similar events relating to the
Common Stock, in each case which occur, or with respect to which “ex-” trading
of the Common Stock begins, during such period. If on any Trading Day there is
no reported sale of Common Stock, the VWAP will not be determinable for such
day.

 

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6.                                       Reclassification: Reorganization or
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 the
property and assets of any nature of the Company as an entirety or substantially
as an entirety, 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 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 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 above.

 

(b)                                 In case of any reclassification or change of
the shares of Common Stock issuable upon exercise of this Warrant (other than a
change in par value or from no par value to a specified par value, or as a
result of a subdivision or combination, but including any change in the shares
into two or more classes or series of shares), or in case of any consolidation
or merger of another corporation into the Company in which the Company is the
continuing corporation and in which there is a reclassification or change
(including a change to the right to receive cash or other property) of the
shares of Common Stock (other than a change in par value, or from no par value
to a specified par value, or as a result of a subdivision or combination, but
including any change in the shares into two or more classes or series of
shares), the Holder shall have the right thereafter to receive upon exercise of
this Warrant solely the kind and amount of shares of stock and other securities,
property, cash, or any combination thereof receivable upon such
reclassification, change, consolidation, or merger by a holder of the number of
shares of Common Stock for which this Warrant might have been exercised
immediately prior to such reclassification, change, consolidation, or merger.
Thereafter, appropriate provision shall be made for adjustments which shall be
as nearly equivalent as practicable to the adjustments in Section 6.

 

(c)                                  Notwithstanding anything to the contrary
herein contained, in the event of a transaction contemplated by Section 6(a) in
which the surviving, continuing, successor, purchasing or leasing corporation
demands that all outstanding convertible notes and warrants be extinguished
prior to the closing date of the contemplated transaction, the Company shall
give prior notice (the “Merger Notice”) thereof to the Holder advising the
Holder of such transaction. The Holder shall have ten (10) days after the date
of the Merger Notice to elect to (i) exercise this Warrant in the manner
provided herein or (ii) receive from the surviving, continuing, successor, or
purchasing corporation the same consideration receivable by a holder of the
number of shares of Common Stock for which this Warrant might have been
exercised immediately prior to such consolidation, merger, sale, or purchase
reduced by such amount of the consideration as has a market value equal to the
Exercise Price, as determined by the Board of Directors of the Company, whose
determination shall be conclusive absent manifest error. If the Holder fails to
timely notify the Company of its election, the Holder shall be deemed for all
purposes to have elected the option set forth in (ii) above. Any amounts
receivable by a Holder who has elected the option set forth in (ii) above shall
be payable at the same time as amounts payable to shareholders in connection
with any such transaction.

 

(d)                                 The above provisions of this Section 6 shall
similarly apply to successive reclassifications and changes of shares of Common
Stock and to successive consolidations, mergers, sales, leases, or conveyances.

 

7.                                       Certain Notices to the Holder. In case
at any time the Company shall propose to: (i) pay any dividend or make any
distribution on shares of Common Stock in shares of Common Stock or make any
other distribution (other than regularly scheduled cash dividends which are not
in a greater amount per share than the most recent such cash dividend) to all
holders of Common Stock; (ii) 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; (iii) effect
any reclassification or change of outstanding shares of Common Stock, or

 

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any consolidation, merger, sale, lease, or conveyance of property, described in
Section 6; or (iv) effect any liquidation, dissolution, or winding-up of the
Company; then, and in any one or more of such cases, the Company shall give
written notice thereof, by certified or registered mail, postage prepaid, to the
Holder at the Holder’s address as it shall appear in the Warrant Register,
mailed at least fifteen (15) days prior to (x) 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, (y)
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 (z) the date of such action which would require
an adjustment to the Exercise Price.

 

8.                                       Issue Tax. The issuance of any shares
or other securities upon the exercise 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.

 

9.                                       Restrictive Legend. The Warrant Shares
issued upon exercise of this Warrant shall be subject to a stop transfer order
and the certificate or certificates evidencing such Warrant Shares shall bear
the following legend:

 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAWS
AND NEITHER SUCH SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD,
PLEDGED, ASSIGNED OR OTHERWISE TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT
WITH RESPECT THERETO IS EFFECTIVE UNDER THE ACT AND ANY APPLICABLE STATE
SECURITIES LAWS, OR (2) THE COMPANY RECEIVES AN OPINION OF COUNSEL TO THE HOLDER
OF SUCH SECURITIES, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE
COMPANY, THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR
TRANSFERRED IN THE MANNER CONTEMPLATED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT OR APPLICABLE STATE SECURITIES LAWS.

 

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

 

11.                                 No Shareholder Rights. The Holder of this
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 shareholders or of any other proceedings of the Company, except as
provided in this Warrant.

 

12.                                 Governing Law. This Warrant has been
negotiated and consummated in the State of New York and shall be construed in
accordance with the laws of the State of New York applicable to contracts made
and performed within such State, without regard to principles governing
conflicts of law.

 

13.                                 Jurisdiction. Each of the Company and the
Holder of this Warrant, irrevocably consents to the jurisdiction of the courts
of the State of New York and of any federal court located in such State in
connection with

 

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any action or proceeding arising out of or relating to this Warrant, any
document or instrument delivered pursuant to, in connection with or
simultaneously with this Warrant, or a breach of this Warrant or any such
document or instrument. In any such action or proceeding, the Company waives
personal service of any summons, complaint or other process and agrees that
service thereof may be made in accordance with Section 14 hereof.

 

14.                                 Notices. Any notice or other communication
required or permitted to be given hereunder shall be in writing and shall be
mailed by certified mail, return receipt requested, or by Federal Express,
Express Mail or similar overnight delivery or courier service or delivered (in
person or by telecopy, telex or similar telecommunications equipment) against
receipt to the party to whom it is to be given:

 

if to the Company:                                              Bioject Medical
Technologies Inc.

20245 S.W. 95thAvenue
Tualatin, OR  97062
Attention:  Christine Farrell
Facsimile:  (503) 692-6783

 

if to the Holder:            

 

or in either case, to such other address as the party shall have furnished in
writing in accordance with the Provisions of this Section 14. Any notice or
other communication given by certified mail shall be deemed given at the time of
certification thereof, except for a notice changing a party’s address which
shall be deemed given at the time of receipt thereof. Any notice given by other
means permitted by this Section 14 shall be deemed given at the time of receipt
thereof;

 

15.                                 Overall Cap On Common Stock Issued And
Issuable.

 

(a)                                  Notwithstanding anything herein or in any
agreement between the Holder and the Company executed in connection herewith to
the contrary, if the rules of Nasdaq require, the Holder shall not have the
right to exercise any portion of this Warrant for shares of Common Stock in
accordance with its terms (such shares of Common Stock being referred to herein
as “Conversion Shares”), to the extent that either: (i) the aggregate number of
Conversion Shares issued and issuable by the Company pursuant to the Bridge
Notes and the Bridge Warrants exceeds 19.9% of the number of shares of Common
Stock or the voting power of the Company outstanding on the original date of
issuance of the Warrants (“Date of Original Issuance”) or (ii) after giving
effect to such conversion or exercise, the Holder (together with the Holder’s
affiliates) would beneficially own in excess of 19.9% of the number of shares of
the Common Stock or the voting power of the Company outstanding immediately
after the Bridge Loan  (the securities issued and issuable up to and in
compliance with the 19.9% thresholds described in clauses (i) and (ii) above,
being referred to herein as the “Issuable Maximum”), unless the issuance of
securities in excess of the Issuable Maximum shall first be approved by the
Company’s shareholders in accordance with applicable law and the Bylaws and
Articles of Incorporation of the Company. If, at the time of any potential
exercise of this Warrant, the Conversion Shares issued and issuable exceed the
Issuable Maximum (and if the Company has not previously obtained the required
shareholder approval), the Company shall issue to the Holder a number of
Conversion Shares not exceeding the Issuable Maximum, and the remainder of the
Conversion Shares to be issued shall constitute “Excess Shares” pursuant to
paragraph 15(b) below.

 

(b)                                 In the event than the Holder’s receipt of
Conversion Shares is restricted based on the Issuable Maximum, the Company shall
promptly call a shareholder’s meeting for the purpose of obtaining shareholder
approval of the issuance of the Excess Shares to the Holder. No Conversion
Shares issued pursuant to exercise of any Warrants shall be entitled to vote to
approve the issuance of the Excess Shares.

 

(c)                                  Neither the Company nor any Holder
may waive the provisions of this Section 15.

 

8

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IN WITNESS WHEREOF, this Warrant has been duly executed as of March        ,
2006.

 

 

 

BIOJECT MEDICAL TECHNOLOGIES INC.

 

 

 

 

 

By:

 

 

 

Name:

 

Title:

 

 

 

 

 

[HOLDER]

 

 

 

 

 

By:

 

 

 

Name:

 

Title:

 

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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,                              hereby sells, assigns, and
transfers unto:

 

Name:

 

Address:

 

Social Security or Employer Identification Number:

 

the right to purchase                             shares of Common Stock, no par
value, of Bioject Medical Technologies Inc. (the “Company”) represented by the
attached Warrant, 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:

 

 

 

Signature:

 

 

Name:

 

 

 

 

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.

 

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ELECTION TO EXERCISE

 

The undersigned hereby exercises its rights to purchase                Warrant
Shares covered by the within Warrant, and tenders payment herewith in the
aggregate amount of $               , including (i) $                by
certified or bank cashier’s check or wire transfer, and/or (ii) subject to
paragraph 1(b) of the Warrant, cancellation of Warrants to purchase        
Warrant Shares based upon a Maximum Number (as therein defined)
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.

 

 

 

 

 

 

 

 

 

 

 

(Print Name, Address and Social Security
or Tax identification Number)

 

 

Name of Holder

 

 

 

 

Dated:

 

 

 

 

 

Signature

 

 

 

 

Print Name

 

 

 

 

Title (if entity)

 

Address:

 

 

 

 

 

 

 

 

Signature Guarantee

 

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