ex4-1.htm


    Exhibit 4.1

    

 

    NEITHER
THE SECURITIES REPRESENTED BY THIS WARRANT NOR THE UNDERLYING SHARES OF COMMON
STOCK HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“1933 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 1933 ACT, OR (2) PURSUANT TO AN EXEMPTION FROM REGISTRATION
UNDER THE 1933 ACT AND ANY APPLICABLE STATE SECURITIES LAWS AND THE COMPANY
SHALL HAVE RECEIVED AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY AS TO SUCH
EXEMPTION.

    


    IN
ADDITION, A SECURITIES PURCHASE AGREEMENT DATED AS
OF     November 2, 2009, A COPY OF WHICH MAY BE
OBTAINED FROM THE COMPANY AT ITS PRINCIPAL EXECUTIVE OFFICE, CONTAINS CERTAIN
ADDITIONAL AGREEMENTS BETWEEN THE PARTIES WITH RESPECT TO THIS
WARRANT.

    


    ---------------------------------------

    


    BIOSTAR
PHARMACEUTICALS, INC.

    


    COMMON
STOCK PURCHASE WARRANT

    


    Number of
Shares:                                                                Holder:

    


    Issue
Date: November 2, 2009

    


    Expiration
Date: November 2, 2014

    


    Exercise Price per Share:
$3.00

    


    THIS
COMMON STOCK PURCHASE WARRANT is issued by BIOSTAR PHARMACEUTICALS, INC, a
Maryland corporation (the “Company”) pursuant to
a Securities Purchase Agreement dated November 2, 2009, as amended (“Purchase
Agreement”).

    


    The
Company hereby certifies that, for value received, __________, or registered
assigns (the “Warrant
Holder”), is entitled, subject to the terms set forth below, to purchase
from the Company up to ________ shares (as adjusted from time to time as
provided in Section 7 of this Warrant, the “Warrant Shares”) of
common stock, $.001 par value (the “Common Stock”), of
the Company at a price of three dollars ($3.00) per Warrant Share (as adjusted
from time to time as provided in Section 7, the “Exercise Price”), at
any time and from time to time from and after the date thereof and through and
including 5:00 p.m. New York City time on November 2, 2014 (the “Expiration Date”),
and subject to the following terms and conditions:

     

    1. Registration
of Warrant.  The Company shall
register this Warrant upon records to be maintained by the Company for that
purpose (the “Warrant
Register”), in the name of the record Warrant Holder hereof from time to
time.  The Company may deem and treat the registered Warrant Holder of
this Warrant as the absolute owner hereof for the purpose of any exercise hereof
or any distribution to the Warrant Holder, and for all other purposes, and the
Company shall not be affected by notice to the contrary.

     

    2. Investment
Representation.  The Warrant
Holder by accepting this Warrant represents that the Warrant Holder is acquiring
this Warrant for its own account or the account of an affiliate that is an
accredited investor which has been identified to and approved by (such approval
not to be unreasonably withheld or delayed) for investment purposes and not with
the view to any offering or distribution and that the Warrant Holder will not
sell or otherwise dispose of this Warrant or the underlying Warrant Shares in
violation of applicable securities laws.  The Warrant Holder
acknowledges that the certificates representing any Warrant Shares will bear a
legend indicating that they have not been registered under the 1933 Act, and may
not be sold by the Warrant Holder except pursuant to an effective registration
statement or pursuant to an exemption from registration requirements of the 1933
Act and in accordance with federal and state securities laws.  If this
Warrant was acquired by the Warrant Holder pursuant to the exemption from the
registration requirements of the 1933 Act afforded by Regulation S thereunder,
the Warrant Holder acknowledges and covenants that this Warrant may not be
exercised by or on behalf of a Person during the one year distribution
compliance period (as defined in Regulation S) following the date
hereof.  “Person” means an
individual, partnership, firm, limited liability company, trust, joint venture,
association, corporation, or any other legal entity.

     

    3. Validity
of Warrant and Issue of Shares.  The Company
represents and warrants that this Warrant has been duly authorized and validly
issued and warrants and agrees that all of Common Stock that may be issued upon
the exercise of the rights represented by this Warrant will, when issued upon
such exercise, be duly authorized, validly issued, fully paid and nonassessable
and free from all taxes, liens and charges with respect to the issue thereof
other than those incurred by the Holder.  The Company further warrants
and agrees that during the Exercise Period, the Company will at all times have
authorized and reserved a sufficient number of Common Stock to provide for the
exercise of the rights represented by this Warrant.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    4. Registration of Transfers
and Exchange of Warrants.

     

    a. Subject
to compliance with the federal and state securities laws, the Company shall
register the transfer of any portion of this Warrant in the Warrant Register,
upon surrender of this Warrant with the Form of Assignment attached hereto duly
completed and signed, to the Company at the office specified in or pursuant to
Section 13.  Upon any such registration or transfer, a new warrant to
purchase Common Stock, in substantially the form of this Warrant (any such new
warrant, a “New
Warrant”), evidencing the portion of this Warrant so transferred shall be
issued to the transferee and a New Warrant evidencing the remaining portion of
this Warrant not so transferred, if any, shall be issued to the transferring
Warrant Holder.  The acceptance of the New Warrant by the transferee
thereof shall be deemed the acceptance of such transferee of all of the rights
and obligations of a Warrant Holder of a Warrant.

     

    b. This
Warrant is exchangeable, upon the surrender hereof by the Warrant Holder to the
office of the Company specified in or pursuant to Section 9 for one or more New
Warrants, evidencing in the aggregate the right to purchase the number of
Warrant Shares which may then be purchased hereunder.  Any such New
Warrant will be dated the date of such exchange.

     

    
      	
              5.  

            	
              Exercise of
      Warrants.

            


    

     

    a. Upon
surrender of this Warrant with the Form of Election to Purchase attached hereto
duly completed and signed to the Company, at its address set forth in Section
13, and upon payment and delivery of the Exercise Price per Warrant Share
multiplied by the number of Warrant Shares that the Warrant Holder intends to
purchase hereunder, in lawful money of the United States of America, by wire
transfer or by certified or official bank check or checks, to the Company, all
as specified by the Warrant Holder in the Form of Election to Purchase, the
Company shall promptly (but in no event later than 7 business days after the
Date of Exercise (as defined herein)) issue or cause to be issued  and
cause to be delivered to or upon the written order of the Warrant Holder and in
such name or names as the Warrant Holder may designate (subject to the
restrictions on transfer described in the legend set forth on the face of this
Warrant), a certificate for the Warrant Shares issuable upon such exercise, with
such restrictive legend as required by the 1933 Act.  Any person so
designated by the Warrant Holder to receive Warrant Shares shall be deemed to
have become holder of record of such Warrant Shares as of the Date of Exercise
of this Warrant.

     

    b. A “Date of Exercise”
means the date on which the Company shall have received (i) this Warrant (or any
New Warrant, as applicable), with the Form of Election to Purchase attached
hereto (or attached to such New Warrant) appropriately completed and duly
signed, and (ii) payment of the Exercise Price for the number of Warrant Shares
so indicated by the Warrant Holder to be purchased.

     

    c. This
Warrant shall be exercisable at any time and from time to time during the
Exercise Period for such number of Warrant Shares as is indicated in the
attached Form of Election to Purchase.  If less than all of the
Warrant Shares which may be purchased under this Warrant are exercised at any
time, the Company shall issue or cause to be issued, at its expense, a New
Warrant evidencing the right to purchase the remaining number of Warrant Shares
for which no exercise has been evidenced by this Warrant.

    
    

     

    
    

    
      	                   
                 
      d.	(i) Notwithstanding
      anything contained herein to the contrary, but subject to Section 5(e) and
      Section 6, the holder of this Warrant may, at its election exercised in
      its sole discretion, exercise this Warrant in whole or in part and, in
      lieu of making the cash payment otherwise contemplated to be made to the
      Company upon such exercise in payment of the Aggregate Exercise Price,
      elect instead to receive upon such exercise the “Net Number” of shares of
      Common Stock determined according to the following formula (a “Cashless
      Exercise”):
	 	 
	 	Net
      Number = (A x (B - C))/B
	 	 
	 	(ii) For
      purposes of the foregoing formula:
	 	 
	 	A=
      the total number shares with respect to which this Warrant is then being
      exercised.
	 	 
	 	B=
      the last reported sale price (as reported by Bloomberg) of the Common
      Stock on the trading day immediately preceding the date of the Exercise
      Notice.
	 	 
	 	C=
      the Warrant Exercise Price then in effect at the time of such
      exercise.


    

     

    6. Maximum
Exercise.  The Warrant
Holder shall not be entitled to exercise this Warrant on a Date of
Exercise in connection with that number of shares of Common Stock which would be
in excess of the sum of (i) the number of shares of Common Stock beneficially
owned by the Warrant Holder and its affiliates on the Date of Exercise, and (ii)
the number of shares of Common Stock issuable upon the exercise of this Warrant
with respect to which the determination of this limitation is being made on an
Date of Exercise, which would result in beneficial ownership by the Warrant
Holder and its affiliates of more than 9.9% of the outstanding shares of Common
Stock on such date.  This Section 6 may not be waived or amended. As
used in this Warrant, beneficial ownership shall be determined in accordance
with Section 13(d) of the Securities Exchange Act of 1934, as amended (the
“Exchange
Act”), and Regulation 13d-3 thereunder.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    7. Adjustment
of Exercise Price and Number of Shares.  The character of the
shares of stock or other securities at the time issuable upon exercise of this
Warrant and the Exercise Price therefore, are subject to adjustment upon the
occurrence any of the following events which shall have occurred or which shall
occur at any time on or after the Closing Date, as defined in the Purchase
Agreement and regardless of whether any Warrants were issued on the Closing
Date, and all such adjustments shall be cumulative:

     

    a. Adjustment for Stock Splits, Stock
Dividends, Recapitalizations, Etc.  The Exercise Price of this
Warrant and the number of shares of Common Stock or other securities at the time
issuable upon exercise of this Warrant shall be appropriately adjusted to
reflect any stock dividend, stock split, stock distribution, combination of
shares, reverse split, reclassification, recapitalization or other similar event
affecting the number of outstanding shares of stock or securities.

     

    b. Adjustment for Reorganization,
Consolidation, Merger, Etc.  In case of any consolidation or
merger of the Company with or into any other corporation, entity or person, or
any other corporate reorganization, in which the Company shall not be the
continuing or surviving entity of such consolidation, merger or reorganization
(any such transaction being hereinafter referred to as a “Reorganization”),
then, in each case, the holder of this Warrant, on exercise hereof at any time
after the consummation or effective date of such Reorganization (the “Effective Date”),
shall receive, in lieu of the shares of stock or other securities at any time
issuable upon the exercise of the Warrant issuable on such exercise prior to the
Effective Date, the stock and other securities and property (including cash) to
which such holder would have been entitled upon the Effective Date if such
holder had exercised this Warrant immediately prior thereto (all subject to
further adjustment as provided in this Warrant).

     

    c. Certificate as to
Adjustments.  In case of any adjustment or readjustment in the
price or kind of securities issuable on the exercise of this Warrant, the
Company will promptly give written notice thereof to the holder of this Warrant
in the form of a certificate, certified and confirmed by the Board of Directors
of the Company, setting forth such adjustment or readjustment and showing in
reasonable detail the facts upon which such adjustment or readjustment is
based.

     

    8. Fractional
Shares.  The Company shall
not be required to issue or cause to be issued fractional Warrant Shares on the
exercise of this Warrant.  The number of full Warrant Shares that
shall be issuable upon the exercise of this Warrant shall be computed on the
basis of the aggregate number of Warrants Shares purchasable on exercise of this
Warrant so presented.  If any fraction of a Warrant Share would,
except for the provisions of this Section 8, be issuable on the exercise of this
Warrant, the Company shall, at its option, (i) pay an amount in cash equal to
the Exercise Price multiplied by such fraction or (ii) round the number of
Warrant Shares issuable, up to the next whole number.

     

    9. Sale or
Merger of the Company.  Upon a Merger
Transaction, the restriction contained in Section 6 shall immediately be
released and the Warrant Holder will have the right to exercise this Warrant
concurrently with such Merger Transaction.  For purposes of this
Warrant, the term “Merger Transaction” shall mean a consolidation or merger of
the Company into another company or entity in which the Company is not the
surviving entity or the sale of all or substantially all of the assets of the
Company to another company or entity not controlled by the then existing
stockholders of the Company.

     

    10. Notice of
Intent to Sell or Merge the Company.  The Company will
give Warrant Holder ten (10) business days notice before any Merger
Transaction.

     

    11. Issuance
of Substitute Warrant. In the event of a merger,
consolidation, recapitalization or reorganization of the Company or a
reclassification of Company shares of stock, which results in an adjustment to
the number of shares subject to this Warrant and/or the Exercise Price
hereunder, the Company agrees to issue to the Warrant Holder a substitute
Warrant reflecting the adjusted number of shares and/or Exercise Price upon the
surrender of this Warrant to the Company.  However, in the event that
the Company does not issue a substitute warrant, the number and class of Warrant
Shares or other securities and the Exercise Price shall be adjusted as provided
in this Warrant, and this Warrant shall relate the adjusted number of Warrant
Shares and Exercise Price.

     

    
    

    12. Right of
Redemption.

     

    
      	
                                       
            a.  

            	
              i.The
      Company shall have the right at any time, on written notice given not less
      than forty five (45) days prior to the Redemption Date, to redeem the
      outstanding Warrants at the Redemption Price of one cent ($.01) per share
      of Common Stock issuable upon exercise of the Warrants, provided the
      Market Price of the Common Stock shall equal or exceed the “Target Price”
      on each trading day in the consecutive twenty (20) trading days in the
      period ending on the trading day prior to the date that the Company calls
      the Warrants for redemption Notice of redemption shall be mailed by first
      class mail, postage prepaid, and sent by telecopier and e-mail not later
      than three (3) business days after the date the Warrants are called for
      redemption, and shall be deemed given on the date of receipt of the notice
      by the Holder.  All Warrants must be redeemed if any Warrants
      are redeemed; provided, however, that if the exercise by the Company of
      its right of redemption pursuant to this Section 12(a)(i) would result in
      a violation of the 9.9% Limitation, the Company shall not have the right
      to redeem the Holders’ Warrants to the extent that the exercise of the
      Warrants as to which the redemption notice is given would result in such a
      violation.  In such event, the Company may subsequently exercise
      it right to redeem the remaining Warrants held by the Holder on and
      subject to the provisions of this Section
  12(a)(i).

            


    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	
               

            	
              ii.
      As used in this Section 12, the following terms shall have the meanings
      set forth below:

            


    

     

    
      	
              1.  

            	
              “Redemption
      Date” shall mean the date on which the Warrants are to be redeemed as set
      forth in the notice of redemption from the Company to the Holders of the
      Warrants, as the same may be extended pursuant to Section 12(b)(ii) of
      this Warrant.

            


    

     

    
      	
              2.  

            	
              “Market
      Price” shall mean the closing bid price of the Common Stock (as reported
      by Bloomberg L.P. or, if the Common Stock is traded on the Nasdaq Stock
      Market or the New York or American Stock Exchange, as reported by such
      market or exchange).

            


    

     

    
      	
              3.  

            	
              “Target
      Price” shall mean four and 50/100 dollars
  ($4.50).

            


    

     

    
      	
               b.

            	
               Notwithstanding
      any other provision of this Section
12:

            


    

     

    
      	 	i.
      For a period of 12 months from the Issue Date, the Company may only
      mandate the Holder of the Warrant to exercise this Warrant pursuant to
      Section 12 of this Warrant if a registration statement covering the sale
      by the Holder of the Warrant Shares of Common Stock issuable upon exercise
      of this Warrant is current and effective for the 25 trading days prior to
      the Notice Date and the right of the Company to mandate exercise only
      applies with respect to the Warrant Shares included in such registration
      statement.


    

     

    
      	
                

            	
              ii.
      The Redemption Date shall be postponed for two (2) trading days for each
      day after the Warrants are called for redemption that the Market Price of
      the Common Stock is less than the Target Price; provided, however, that if
      the Market Price shall be less than the Target Price for ten (10)
      consecutive trading days or fifteen (15) trading days during the period
      from the date the Warrants are called for redemption to the Redemption
      Date, the Company’s right to redeem any Warrants not theretofore exercised
      or converted shall terminate, subject to the right of the Company to call
      the remaining Warrants for redemption pursuant to this Section
      12.

            


    

     

    
      	
              c.

            	
              The
      notice of redemption shall specify (i) the Redemption Price, (ii) the
      Redemption Date, (iii) the place where the Warrants shall be delivered and
      the Redemption Price shall be paid, (iv) the representation required by
      Section 12(b)(i), (v) the number of Warrants being called for redemption
      if less than all of the Warrants are being redeemed, and (vi) that the
      right to exercise the Warrants shall terminate at 5:30 p.m. (New York City
      time) on the trading day immediately preceding the Redemption
      Date.  No failure to mail such notice nor any defect therein or
      in the mailing thereof shall affect the validity of the proceedings for
      such redemption except as to a Holder (x) to whom notice was not mailed or
      (y) whose notice was defective.  An affidavit of the Chief
      Financial Officer of the Company that notice of redemption has been mailed
      shall, in the absence of fraud, be prima facie evidence of the facts
      stated therein.

            


    

     

    
      	
              d.

            	
              Any
      right to exercise or convert a Warrant to the extent that the Warrant was
      called for redemption shall terminate at 5:30 p.m. (New York City time) on
      the Redemption Date.  After such time, Holders of the Warrants
      shall have no further rights except to receive, upon surrender of the
      Warrant, the Redemption Price without interest, subject to the provisions
      of applicable laws relating to the treatment of abandoned
      property.

            


    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    13. Notice.  All notices and
other communications hereunder shall be in writing and shall be deemed to have
been given (i) on the date they are delivered if delivered in person; (ii) on
the date initially received if delivered by facsimile transmission followed by
registered or certified mail confirmation; (iii) on the date delivered by an
overnight courier service; or (iv) on the date of delivery after it is mailed by
registered or certified mail, return receipt requested with postage and other
fees prepaid as follows:

     

    
      	 	If to the
      Company:
	 	 
	 	Biostar
      Pharmaceuticals, Inc.
	 	No. 588 Shiji
      Avenue, Xiangyang City,
	 	Shaanxi Province,
      The People’s Republic of China
	 	Attention: Mr.
      Ronghua Wang
	 	E-mail:
      office@aoxing-group.com
	 	Fax:
	 	 
	 	With a copy
      to:
	 	 
	 	Sichenzia
      Ross Friedman Ference LLP
	 	61
      Broadway, 32 Floor
	 	New
      York, New York 10006
	 	Attention:
      Benjamin Tan
	 	E-mail:
      btan@srff.com
	 	Fax:
      (212) 930-9725
	 	 
	 	If to the Warrant
      Holder:


    

     

    at the
address or telecopier number and to the attention of the person shown on the
Company’s warrant register.

     

    14. Miscellaneous.


    a. This
Warrant shall be binding on and inure to the benefit of the parties hereto and
their respective successors and permitted assigns.  This Warrant may
be amended only by a writing signed by the Company and the Warrant
Holder.

     

    b. Nothing
in this Warrant shall be construed to give to any person or corporation other
than the Company and the Warrant Holder any legal or equitable right, remedy or
cause of action under this Warrant; this Warrant shall be for the sole and
exclusive benefit of the Company and the Warrant Holder.

     

    c. This
Warrant shall be governed by, construed and enforced in accordance with the
internal laws of the State of New York without regard to the principles of
conflicts of law thereof.

     

    d. The
headings herein are for convenience only, do not constitute a part of this
Warrant and shall not be deemed to limit or affect any of the provisions
hereof.

     

    e. In case
any one or more of the provisions of this Warrant shall be invalid or
unenforceable in any respect, the validity and enforceability of the remaining
terms and provisions of this Warrant shall not in any way be affected or
impaired thereby and the parties will attempt in good faith to agree upon a
valid and enforceable provision which shall be a commercially reasonably
substitute therefore, and upon so agreeing, shall incorporate such substitute
provision in this Warrant.

     

    f. The
Warrant Holder shall not, by virtue hereof, be entitled to any voting or other
rights of a stockholder of the Company, either at law or equity, and the rights
of the Warrant Holder are limited to those expressed in this
Warrant.

     

    IN
WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by the
authorized officer as of the date first above stated.

    


    


    Date:
________________                          
BIOSTAR PHARMACEUTICALS, INC.

    


                                                                               By:_______________________                                                                

                                                                              
Name:

                                                                              
Title:  Chief
Executive Officer

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    FORM
OF ELECTION TO PURCHASE

    


    (To be
executed by the Warrant Holder to exercise the right to purchase shares
of

    Common
Stock under the foregoing Warrant)

    


    To:  Biostar Pharmaceuticals,
Inc.:

    


    In
accordance with the COMMON STOCK WARRANT enclosed with this Form of Election to
Purchase, the undersigned hereby irrevocably elects to purchase ______________
shares of Common Stock (“Common Stock”), $.001 par value, of Biostar
Pharmaceuticals, Inc. and encloses the warrant and $____ for each Warrant Share
being purchased or an aggregate of $________________ in cash or certified or
official bank check or checks, which sum represents the aggregate Exercise Price
(as defined in the Warrant) together with any applicable taxes payable by the
undersigned pursuant to the Warrant.

    


    The
undersigned requests that certificates for the shares of Common Stock issuable
upon this exercise be issued in the name of:

     

    
      	 	 	 
	 	 	 
	 	 	 
	 	(Please print name
      and address)	 
	 	 	 
	 	 	 
	 	(Please insert
      Social Security or Tax Identification Number)	 


    

                                                             

     

    If the
number of shares of Common Stock issuable upon this exercise shall not be all of
the shares of Common Stock which the undersigned is entitled to purchase in
accordance with the enclosed Warrant, the undersigned requests that a New
Warrant (as defined in the Warrant) evidencing the right to purchase the shares
of Common Stock not issuable pursuant to the exercise evidenced hereby be issued
in the name of and delivered to:

                                                                               

     

    
      	 	 	 
	 	 	 
	 	 	 
	 	(Please print name
      and address)	 


    

     

    
       

      
        	Dated:                             	Name of Warrant
      Holder:	 	 
	 	 	 	 
	 	(Print)  	 	 
	 	 	 	 
	 	(By:) 	 	 
	 	 	 	 
	 	(Name:)  	 	 
	 	 	 	 
	 	(Title:)  	 	 


      

       

      (Signature
must conform in all respects to name of Warrant Holder as specified on the face
of the Warrant)