Warrant to purchase common stock between the Company and David Geller


    Exhibit
      10.17

     

     

    THESE
      SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
      (THE “ACT”), OR UNDER ANY STATE SECURITIES LAWS. THESE SECURITIES ARE SUBJECT TO
      RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED, SOLD,
      OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION
      STATEMENT IN EFFECT WITH RESPECT TO THESE SECURITIES UNDER THE ACT OR APPLICABLE
      STATE SECURITIES LAWS OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY
      THAT
      ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE ACT AND ANY APPLICABLE
      STATE SECURITIES LAWS. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED
      TO
      BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF
      TIME.

     

    March
      12,
      2003

     

    WARRANT
      TO PURCHASE COMMON STOCK

     

    OF

     

    BIOSPECIFICS
      TECHNOLOGIES CORP.

     

    THIS
      CERTIFIES THAT, in consideration of the loan in the amount of $100,000 made
      by
      David Geller (“Registered
      Holder”)
      on
      March 11, 2003 to BioSpecifics Technologies Corp., a Delaware corporation (the
      “Company”),
      receipt of which is hereby acknowledged, Registered Holder is entitled, subject
      to the terms and conditions of this warrant (the “Warrant”),
      to
      purchase from the Company at any time after the date set forth above (the
“Issue
      Date”)
      and
      prior to 5:00 p.m. New York Time on March 11, 2008 (the “Expiration
      Date”),
      10,000 shares of Common Stock at a price per share equal to $1.18 (the
“Warrant
      Price”),
      upon
      surrender of this Warrant at the principal office of the Company, together
      with
      a duty executed subscription form in the form attached hereto as Exhibit
      1
      (or
Exhibit
      2
      in the
      event of a net issue election pursuant to Section 3) and simultaneous payment
      of
      the full Warrant Price for the shares of Common Stock so purchased in lawful
      money of the United States (or as otherwise provided pursuant to Section 3).
      The
      Warrant Price and the number and character of shares of Common Stock purchasable
      under this Warrant ace subject to adjustment as provided herein.

     

    1.  Certain
      Definitions.
      The
      following definitions shall apply for purposes of this Warrant:

     

    (a)  “Common
      Stock”
means
      shames of common stock of the Company, par value $.001 per share.

     

    (b)  “Fair
      Market Value”
means
      the fair market value of the Company’s Common Stock determined as
      follows:

     

    (i)  if
      the
      Common Stock is then traded on a national securities exchange or the Nasdaq
      National Market (or a similar national quotation system), than the value shall
      be deemed to be the average of the closing prices of such Common Stock on such
      exchange or system over the ten (10) day period ending one (1) business day
      prior to the date of the exercise or net issue election by the Registered Holder
      pursuant to Section 2 or 3, as applicable; and

     

    (ii)  if
      (i)
      above does not apply but the securities are actively traded over-the-counter,
      then the value shall be deemed to be the average of the closing bid prices
      over
      the ten (10) day period ending one (1) business day prior to the date of
      the

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    exercise
      or net issue election by the Registered Holder pursuant to Section 2 or 3,
      as
      applicable; and

     

    (iii)  if
      there
      is no active public market for the Common Stock, then the value shall be the
      fair market value thereof as of the date of the exercise or net issue election
      by the Registered Holder pursuant to Section 2 or 3, as applicable, as
      determined in good faith by the Board.

     

    2.  Exercise.
      This
      Warrant may be exercised in whole or in part, at any time or from time to time
      prior to the Expiration Date, by surrendering this Warrant at the principal
      office of the Company at 35 Wilbur Street, Lynbrook, New York 11563 (or if
      the
      principal offices of the Company are changed, then at such other address for
      the
      principal offices of the Company shall give written notice to the Registered
      Holder), with the subscription form attached hereto duly executed by the
      Registered Holder, and payment, in cash of an amount equal to the product
      obtained by multiplying (i) the number of shares of Common Stock purchased
      upon
      such exercise by (ii) the Warrant Price, as determined in accordance with the
      terms hereof.

     

    Upon
      a
      partial exercise of this Warrant: (i) the number of shares of Common Stock
      issuable upon exercise hereof immediately prior to such exercise shall be
      reduced by the aggregate number purchased upon such exercise of this Warrant,
      and (ii) this Warrant shall be surrendered by the Registered Holder and replaced
      with a new Warrant of like tenor in which the number of shares of Common Stock
      issuable thereon is reduced by the number of shares of Common Stock purchased
      hereunder. This Warrant shall be deemed to have been exercised immediately
      prior
      to the close of business on the date of its surrender for exercise as provided
      above, and the person entitled to receive the shares of Common Stock issuable
      upon such exercise shall be treated for all purposes as the holder of record
      of
      such shares as of the close of business on such date. As soon as practicable
      on
      or after such date, the Company shall issue and deliver to the person or persons
      entitled to receive the same a certificate or certificates for the number of
      whole shares of Common Stock issuable upon such exercise, together with cash
      in
      lieu of any fraction of a share equal to such fraction of the current Fair
      Market Value of one whole share of Common Stock as of the date of exercise.
      No
      fractional shares may be issued upon any exercise of this Warrant, and any
      fractions shall be rounded down to the nearest whole number of
      shares.

     

    3.  Net
      Issue Election.
      The
      Registered Holder may, in lieu of exercising this Warrant in exchange for
      payment of cash, elect to receive instead, without the payment by the Registered
      Holder of any additional consideration and upon the delivery of Net Issue
      Election Notice annexed hereto as Exhibit
      2
      duly
      executed, at the principal office of the Company, that number of shares of
      Common Stock equal to X as is computed using the following formula:

     

    X=
      Y(A
      -
      B)

           
      A

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    where:

     

    
      	 	
              X
                =

            	
              the
                number of shares of Common Stock to be issued to the Registered Holder
                pursuant to this Section 3.

            


    

     

    
      	 	
              Y
                =

            	
              the
                number of shares of Common Stock that would have been issuable upon
                such
                an exercise, or partial exercise, as applicable, of this Warrant
                under
                Section 3 if such exercise had instead been made pursuant to Section
                2
                without any shares issuable upon such exercise being deemed surrendered
                to
                the Company as payment of the Warrant
                Price.

            


    

     

    
      	 	
              A
                =

            	
              the
                Fair Market Value of one share of Common
                Stock.

            


    

     

    
      	 	
              B
                =

            	
              the
                Warrant price in effect under this Warrant at the time the net issue
                election is made pursuant to this Section
                3.

            


    

     

    4.  Fully
      Paid Shares.
      All
      shares of Common Stock issued upon the exercise of this Warrant shall be validly
      issued, fully paid and nonassessable.

     

    5.  Adjustment
      of Warrant price and Number of Shares.
      The
      number and character of shares of Common Stock issuable upon exercise of this
      Warrant (or any shares of stock or other securities or property at the time
      receivable or issuable upon exercise of this Warrant) and the Warrant Price
      therefor, are subject to adjustment upon the occurrence of the following
      events:

     

    5.1  Adjustment
      for Stock Splits, Stock Dividends, Recapitalizations etc.
      The
      Warrant Price and the number of shares of Common Stock issuable upon exercise
      of
      this Warrant shall each be proportionally adjusted to reflect any stock
      dividend, stock split, or stock combination affecting the number of outstanding
      shares of Common Stock that occurs after the Issue Date.

     

    5.2  Adjustment
      for Other Dividends and Distributions.
      In case
      the Company shall make or issue, or shall fix a record date for the
      determination of eligible holders entitled to receive, a dividend or other
      distribution payable with respect to the Common Stock payable in securities
      of
      the Company (other than issuances with respect to which adjustment is made
      under
      Section 5.1) or other non-cash assets of the Company, then, and in each such
      case, the Registered Holder of this Warrant, upon exercise of this Warrant
      at
      any time after the consummation, effective date or record date of such event,
      shall receive, in addition to the shares of Common Stock issuable upon such
      exercise prior to such date, the securities or such other assets of the Company
      to which such Registered Holder would have been entitled upon such date if
      such
      Registered Holder had exercised this Warrant immediately prior thereto (all
      subject to further adjustment as provided in this Warrant).

     

    5.3  Adjustment
      for Recapitalization, Reorganization, Consolidation, Merger.
      In case
      of any recapitalization or reorganization of the Company (or of any other
      corporation, the stock or other securities of which are at the time receivable
      on the exercise of this Warrant), after

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    the
      Issue
      Date, or in case, after such date, the Company (or any such corporation) shall
      consolidate with or merge into another corporation, then, and in each such
      case,
      the Registered Holder of this Warrant, upon the exercise of this Warrant (as
      provided in Section 2 or Section 3), at any time after the consummation of
      such
      reorganization, consolidation, or merger, shall be entitled to receive, in
      lieu
      of the stock or other securities and property receivable upon the exercise
      of
      this Warrant prior to such consummation, the stock or other securities or
      property to which such Registered Holder would have been entitled upon the
      consummation of such reorganization, consolidation or merger if such Registered
      Holder had so exercised this Warrant immediately prior thereto, all subject
      to
      further adjustment as provided in this Section 5, and the successor or
      purchasing corporation in such reorganization, consolidation or merger (if
      other
      than the Company) shall duly execute aid deliver to the Registered Holder a
      supplement hereto acknowledging such corporation’s obligations under this
      Warrant; and in each such case, the terms of this Warrant shall be applicable
      to
      the shares of stock or other securities or property receivable upon the exercise
      of this Warrant after the consummation of such reorganization, consolidation,
      merger or conveyance.

     

    6.  Certificate
      as to Adjustments.
      In each
      case of any adjustment in either the Warrant Price or in the number of shares
      of
      Common Stock, or other stock, securities or property receivable upon the
      exercise of this Warrant, the Chief Financial Officer of the Company shall
      compute such adjustment in accordance with the terms of this Warrant and prepare
      a certificate setting forth such adjustment and showing in detail the facts
      upon
      which such adjustment is based, including a statement of the adjusted Warrant
      Price. The Company will cause copies of such certificate to be delivered to
      the
      Registered Holder in accordance with the provisions of Section 11.

     

    7.  Loss
      or Mutilation.
      Upon
      receipt by the Company of evidence reasonably satisfactory to it of the
      ownership, and the loss, theft, destruction or mutilation, of this Warrant,
      and
      of indemnity reasonably satisfactory to it, and (in the case of mutilation)
      upon
      surrender and cancellation of this Warrant, the Company will execute and deliver
      in lieu thereof a new Warrant of like tenor.

     

    8.  Reservation
      of Common Stock.
      If at
      any time the number of authorized but unissued shares of the Company’s Common
      Stock or other securities of the Company shall not be sufficient to effect
      the
      full exercise of all of the Warrants, the Company will take such corporate
      action as may, in the opinion of its counsel, be reasonably necessary to
      increase its authorized but unissued shares of Common Stock or other securities
      to such number of shares of Common Stock or other securities as shall be
      sufficient for such purpose; provided, however, if the Company is required
      to
      obtain shareholder approval to increase the authorized but unissued shares
      of
      Common Stock or other securities, the Company shall be required to use all
      reasonable commercial efforts to obtain such approval.

     

    9.  No
      Rights or Liabilities as Shareholder.
      This
      Warrant does not by itself entitle the Registered Holder to any voting rights
      or
      other rights as a shareholder of the Company. In the absence of affirmative
      action by Registered Holder to purchase Common Stock by exercise of this
      Warrant, no provisions of this Warrant, and no enumeration herein of the rights
      or privileges of the Registered Holder, shall cause such Registered Holder
      to be
      a shareholder of the Company for any purpose.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    10.  Limitation
      on Disposition.
      The
      Registered Holder acknowledges that, notwithstanding anything contained herein
      to the contrary, this Warrant may not be sold, transferred or otherwise disposed
      of, in whole or in part, to any person.

     

    11.  Miscellaneous.

     

    11.1  Notices.
      Any
      notice, request or other communication required or permitted hereunder shall
      be
      in writing and shall be deemed to have been duly given upon the earlier of
      (i)
      actual receipt, (ii) the date that is one business day after delivery to an
      express overnight courier service for United States deliveries, fees prepaid;
      (iii) a date that is three business days after delivery to an internationally
      recognized courier for deliveries outside the United States, fees prepaid,
      or
      (iv) a date that is five business days after mailing by certified or registered
      mail, return receipt requested, postage prepaid, to the party to be notified
      as
      follows:

     

    If
      to the Company:

     

        BioSpecifics
      Technologies Corp.

        35
      Wilbur Street

        Lynbrook,
      New York  11563

        Attn: 
Mr.
      Edwin Wegman, CEO

     

    With
      a copy to:

     

        Fried,
      Frank, Harris, Shriver & Jacobson

        One
      New York Plaza

        New
      York, NY  10004-1980

        Attn. 
Mr.
      Jeffrey Bagner

     

    If
      to Registered Holder:

     

        David
      Geller

        c/o
      David Geller Associates

        1017
      Avenue of the Americas

        New
      York, New York  10018

     

    Either
      the Company or the Registered Holder may by notice so given change its address
      for future notice hereunder. Notice shall conclusively be deemed to have been
      given when personally delivered or when delivered in the manner set forth
      above.

     

    11.2  Headings.
      The
      headings in this Warrant are for purposes of convenience in reference only,
      and
      shall not be deemed to constitute a part hereof.

     

    11.3  Governing
      Law; Consent to Jurisdiction.
      This
      Warrant shall be governed by and construed under the internal laws of the State
      of New York as applied to agreements among Now York residents entered into
      and
      to be performed entirely within New York, without reference to principles of
      conflict of laws or choice of laws. The Company and the Registered Holder
      consent to and hereby submit to the exclusive jurisdiction of any state or
      federal court located within the county of New York, state of New York in
      connection with any action, suit or

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

     proceeding
      arising out of or relating to this Warrant brought by any such party against
      any
      other such party, and each of the parties hereto irrevocably waives, to the
      fullest extent permitted by law, any objection which it may now or hereafter
      have to the laying of the venue of any such proceeding brought in such a court
      and any claim that any such proceeding brought in such court has been brought
      in
      an inconvenient forum.

     

    11.4  Terms
      Binding.
      By
      acceptance of this Warrant, the Registered Holder of this Warrant accepts and
      agrees to be bound by all the terms and conditions of this Warrant.

    
       

      	
              BIOSPECIFICS
                TECHNOLOGIES CORP.

            
	
              By:
                 /s/ Edwin H.
                Wegman                                                               
                

            
	
              Name:
                Edwin H.
                Wegman                                                                 

            
	
              Title:
                President and
                Chairman                                                        
                 

            


       

    

     

    [Signature
      page to Common Stock Warrant Issued by BioSpecifics

    Technologies
      Corp. to Registered Holder]

    


    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    


    EXHIBIT
      1

     

    FORM
      OF SUBSCRIPTION

     

    (To
      be
      signed only upon exercise of Warrant)

     

    To: 
      BioSpecifics Technologies Corp.

     

    (1)    The
      undersigned hereby elects to purchase ________ shares of Common Stock of
      BioSpecifics Technologies Corp., pursuant to the terms of the attached Warrant,
      and tenders herewith payment of the purchase price for such shares in
      full.

     

    (2)    Please
      issue a certificate or certificates representing said shares of Common Stock
      in
      the name of Registered Holder,

     

     

     

    
      
        	
                 

              	
                REGISTERED
                  HOLDER

              
	
                 

              	
                 

              
	
                                                                     
                  
(Date)

              	
                                                                                  
                  
(Signature)

              
	
                 

                 

              	
                 

              
	
                                                                                  
                  
(Print Name)

              
	
                 

              
	
                                                                                  
                  
(Print Title)

              


      



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    



    EXHIBIT
      2

     

    Net
      Issue Election Notice

    (To
      be
      signed only upon exercise of Warrant)

     

    To:
      BioSpecifics Technologies Corp.

     

    (1)           
      The
      undersigned hereby elects under Section 3 of the Warrant to which this Net
      Issue
      Election Notice is an Exhibit to purchase, ________ shares of the Common Stock
      of BioSpecifics Technologies Corp., subject to the surrender of the right to
      purchase that number of such shares of Common Stock as determined pursuant
      to
      Section 3.

     

    (2)           
       Please
      issue a certificate or certificates representing said shares of Common Stock
      in
      the name of Registered Holder.

     

     

     

    
      	
               

            	
              REGISTERED
                HOLDER

            
	
               

            	
               

            
	
                                                                   
                
(Date)

            	
                                                                                
                
(Signature)

            
	
               

               

            	
               

            
	
                                                                                
                
(Print Name)

            
	
               

            
	
                                                                                
                
(Print Title)