Exhibit 10.46


 


THIS WARRANT AND THE UNDERLYING SECURITIES HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY
STATE SECURITIES LAWS.  THIS WARRANT AND
THE UNDERLYING SECURITIES MAY NOT BE TRANSFERRED UNLESS (I) THIS WARRANT
AND THE UNDERLYING SECURITIES HAVE BEEN REGISTERED FOR SALE PURSUANT TO THE
SECURITIES ACT, (II) THIS WARRANT AND THE UNDERLYING SECURITIES MAY BE
SOLD PURSUANT TO RULE 144(K) OR (III) THE COMPANY HAS RECEIVED AN OPINION OF
COUNSEL REASONABLY SATISFACTORY TO IT THAT SUCH TRANSFER MAY LAWFULLY BE
MADE WITHOUT REGISTRATION UNDER THE SECURITIES ACT OR QUALIFICATION UNDER
APPLICABLE STATE SECURITIES LAWS.


 


WARRANT TO PURCHASE SHARES OF COMMON STOCK


OF SUNESIS PHARMACEUTICALS, INC.


 


THIS
CERTIFIES THAT, for value received,                                    
is entitled to subscribe for and purchase                        
fully paid and nonassessable shares (the “Shares”) of common stock, par
value $0.0001 per share (the “Common Stock”), of Sunesis Pharmaceuticals, Inc.,
a Delaware corporation (the “Company”), at a price per share equal to $6.21
(such price and such other price as shall result, from time to time, from the
adjustments specified in Section 4 hereof is herein referred to as the “Warrant
Price”), upon the terms and subject to the conditions hereinafter set
forth.


 


1.     Term.  The purchase right represented by this
warrant is exercisable, in whole or in part, at any time and from time to time
from March 17, 2006 (the “Date of Grant”) until the 7-year
anniversary of the Date of Grant.


 


2.     Method of Exercise; Payment; Issuance of New
Warrant.  Subject to Section 1 hereof, the
purchase right represented by this warrant may be exercised by the holder
hereof, in whole or in part and from time to time, at the election of the
holder hereof, by (a) the surrender of this warrant (with the notice of
exercise substantially in the form attached hereto as Exhibit A-1 duly
completed and executed) at the principal office of the Company and by the
payment to the Company, by certified or bank check, or by wire transfer to an
account designated by the Company (a “Wire Transfer”) of an amount equal
to the then applicable Warrant Price multiplied by the number of Shares then
being purchased; or (b)  exercise of the “net issuance” right provided for
in Section 9 hereof.  The person or
persons in whose name(s) any certificate(s) representing shares of Common Stock
shall be issuable upon exercise of this warrant shall be deemed to have become
the holder(s) of record of, and shall be treated for all purposes as the record
holder(s) of, the shares represented thereby (and such shares shall be deemed
to have been issued) immediately prior to the close of business on the date or
dates upon which this warrant is exercised. 
In the event of any exercise of the rights represented by this
warrant, certificates for the shares of stock so purchased shall be delivered
to the holder hereof as soon as practicable and in any event within thirty (30)
days after such exercise and, unless this warrant has been fully exercised or
expired, a new warrant representing the portion of the Shares, if any, with
respect to which this warrant shall not then have been exercised shall also be
issued to the


 

















 


holder hereof as soon as practicable and in any event
within such thirty-day period; provided, however, if requested by the holder of
this warrant, the Company shall use reasonable efforts to cause its transfer
agent to deliver the certificate representing Shares issued upon exercise of this
warrant to a broker or other person (as directed by the holder exercising this
warrant) within the time period required to settle any trade made by the holder
after exercise of this warrant.


 


3.     Stock Fully Paid; Reservation of Shares.  All
Shares that may be issued upon the exercise of the rights represented by this
warrant will, upon issuance pursuant to the terms and conditions herein, be
fully paid and nonassessable, and free from all preemptive rights and taxes,
liens and charges with respect to the issue thereof.  During the period within which the rights
represented by this warrant may be exercised, the Company will at all times
have authorized, and reserved for the purpose of the issue upon exercise of the
purchase rights evidenced by this warrant, a sufficient number of shares of
Common Stock to provide for the exercise of the rights represented by this
warrant.  If at any time during the term
of this warrant the number of authorized but unissued shares of Common Stock
shall not be sufficient to permit exercise of this warrant, the Company will
take such corporate action as may, in the opinion of its counsel, be necessary
to increase its authorized but unissued shares of Common Stock to such number
of shares as shall be sufficient for such purposes.


 


4.     Adjustment of Warrant Price and Number of Shares.  The
number of shares of Common Stock purchasable upon the exercise of this warrant
and the Warrant Price shall be subject to adjustment from time to time upon the
occurrence of certain events, as follows:


 


(a)           Reclassification
or Merger.  In case of any
reclassification or change of securities of the class issuable upon exercise of
this warrant (other than a change in par value, or from par value to no par
value, or from no par value to par value, or as a result of a subdivision or
combination), or in case of any merger of the Company with or into another
corporation (other than a merger with another corporation in which the Company
is the acquiring and the surviving corporation and which does not result in any
reclassification or change of outstanding securities issuable upon exercise of
this warrant), or in case of any sale of all or substantially all of the assets
of the Company, the Company, or such successor or purchasing corporation, as
the case may be, shall duly execute and deliver to the holder of this warrant a
new warrant (in form and substance reasonably satisfactory to the  holder of this warrant), so that the holder
of this warrant shall have the right to receive upon exercise of this warrant,
at a total purchase price equal to that payable upon the exercise of the
unexercised portion of this warrant, and in lieu of the shares of Common Stock
theretofore issuable upon exercise of this warrant, the kind and amount of
shares of stock, other securities, money and property receivable upon such
reclassification, change, merger or sale by a holder of the number of shares of
Common Stock then purchasable under this warrant.  Any new warrant shall provide for adjustments
that shall be as nearly equivalent as may be practicable to the adjustments
provided for in this Section 4.  The
provisions of this Section 4(a) shall similarly apply to successive
reclassifications, changes, mergers and sales.


 


(b)           Subdivision
or Combination of Shares.  If the
Company at any time while this warrant remains outstanding and unexpired shall
subdivide or combine its outstanding shares of Common Stock, the Warrant Price
shall be proportionately decreased and the number of Shares 


 


2

















 


issuable
hereunder shall be proportionately increased in the case of a subdivision and
the Warrant Price shall be proportionately increased and the number of Shares
issuable hereunder shall be proportionately decreased in the case of a
combination.


 


(c)           Stock
Dividends and Other Distributions. 
If the Company at any time while this warrant is outstanding and
unexpired shall (i) pay a dividend with respect to Common Stock payable in
Common Stock, then the Warrant Price shall be adjusted, from and after the date
of determination of stockholders entitled to receive such dividend or
distribution, to that price determined by multiplying the Warrant Price in
effect immediately prior to such date of determination by a fraction (A) the
numerator of which shall be the total number of shares of Common Stock
outstanding immediately prior to such dividend or distribution, and (B) the
denominator of which shall be the total number of shares of Common Stock
outstanding immediately after such dividend or distribution; or (ii) make
any other distribution with respect to Common Stock (except any distribution
specifically provided for in Sections 4(a) and 4(b)), then, in each
such case, provision shall be made by the Company such that the holder of this
warrant shall receive upon exercise of this warrant a proportionate share of
any such dividend or distribution as though it were the holder of the Common
Stock as of the record date fixed for the determination of the stockholders of
the Company entitled to receive such dividend or distribution.


 


(d)           Adjustment
of Number of Shares.  Upon each
adjustment in the Warrant Price, the number of shares of Common Stock
purchasable hereunder shall be adjusted, rounded up to the nearest whole share,
to the product obtained by multiplying the number of Shares purchasable
immediately prior to such adjustment in the Warrant Price by a fraction, the
numerator of which shall be the Warrant Price immediately prior to such
adjustment and the denominator of which shall be the Warrant Price immediately
thereafter.


 


5.     Notice of Adjustments.  Whenever
the Warrant Price or the number of Shares purchasable hereunder shall be
adjusted pursuant to Section 4 hereof, the Company shall make a
certificate signed by its chief financial officer setting forth, in reasonable
detail, the event requiring the adjustment, the amount of the adjustment, the
method by which such adjustment was calculated, and the Warrant Price and the
number of Shares purchasable hereunder after giving effect to such adjustment,
and shall cause copies of such certificate to be mailed to the holder of this
warrant.


 


6.     Fractional Shares.  No
fractional shares of Common Stock will be issued in connection with any
exercise hereunder, but in lieu of such fractional shares the Company shall
make a cash payment therefor based on the product resulting from multiplying
the then fair market value of the Common Stock on the date of exercise as
determined in good faith by the Company’s Board of Directors by such fraction.


 


7.     Compliance with Act; Disposition of Warrant or
Shares of Common Stock.


 


(a)           Compliance
with Act.  The holder of this
warrant, by acceptance hereof, agrees that this warrant, and the shares of
Common Stock to be issued upon exercise hereof are being acquired for investment
and that such holder will not offer, sell or otherwise dispose of this warrant,
or any shares of Common Stock except under circumstances which will not result
in a violation of 


 


3

















 


the
Securities Act of 1933, as amended (the “Securities Act”) or any
applicable state securities laws.  Upon
exercise of this warrant, unless the Shares being acquired are registered under
the Securities Act and any applicable state securities laws or an exemption
from such registration is available, the holder hereof shall confirm in writing
that the shares of Common Stock so purchased are being acquired for investment
and not with a view toward distribution or resale in violation of the
Securities Act and shall confirm such other matters related thereto as may be
reasonably requested by the Company. 
This warrant and all shares of Common Stock issued upon exercise of this
warrant (unless registered under the Securities Act and any applicable state
securities laws) shall be stamped or imprinted with a legend in substantially
the following form:


 


THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS.  THE
SECURITIES REPRESENTED HEREBY MAY NOT BE TRANSFERRED UNLESS (I) SUCH
SECURITIES HAVE BEEN REGISTERED FOR SALE PURSUANT TO THE SECURITIES ACT, (II)
SUCH SECURITIES MAY BE SOLD PURSUANT TO RULE 144(K) OR (III) THE COMPANY
HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO IT THAT SUCH
TRANSFER MAY LAWFULLY BE MADE WITHOUT REGISTRATION UNDER THE SECURITIES
ACT OR QUALIFICATION UNDER APPLICABLE STATE SECURITIES LAWS.


 


Said legend shall be
removed by the Company, upon the request of a holder, at such time as the
restrictions on the transfer of the applicable security shall have
terminated.  In addition, in connection
with the issuance of this warrant, the holder specifically represents to the
Company by acceptance of this warrant as follows:


 


(1)           The
holder is aware of the Company’s business affairs and financial condition, and
has acquired information about the Company sufficient to reach an informed and
knowledgeable decision to acquire this warrant. 
The holder is acquiring this warrant for its own account for investment
purposes only and not with a view to, or for the resale in connection with, any
“distribution” thereof in violation of the Securities Act.


 


(2)           The
holder understands that this warrant has not been registered under the
Securities Act in reliance upon a specific exemption therefrom, which exemption
depends upon, among other things, the bona fide nature of the holder’s
investment intent as expressed herein.


 


(3)           The
holder further understands that this warrant must be held indefinitely unless
subsequently registered under the Securities Act and qualified under any
applicable state securities laws, or unless exemptions from registration and
qualification are otherwise available. 
The holder is aware of the provisions of Rule 144, promulgated
under the Securities Act.


 


(4)           The
holder is an “accredited investor” as such term is defined in Rule 501 of
Regulation D promulgated under the Securities Act.


 


4

















 


(b)           Disposition
of Warrant or Shares.    This warrant
and any shares of Common Stock acquired pursuant to the exercise or conversion
of this warrant may be transferred only pursuant to a registration statement
filed under the Securities Act or an exemption from such registration.  Subject to such restrictions, the Company
shall transfer this warrant from time to time upon the books to be maintained
by the Company for that purpose, upon surrender thereof for transfer properly
endorsed or accompanied by appropriate instructions for transfer and such other
documents as may be reasonably required by the Company, including, if required
by the Company, an opinion of counsel to the effect that such transfer is
exempt from the registration requirements of the Securities Act to establish
that such transfer is being made in accordance with the terms hereof, and a new
warrant shall be issued to the transferee and the surrendered warrant shall be
cancelled by the Company.  Each
certificate representing this warrant or the shares of Common Stock thus
transferred (except a transfer pursuant to Rule 144 or 144A) shall bear a
legend as to the applicable restrictions on transferability in order to ensure
compliance with such laws, unless such legend is not required in order to
ensure compliance with such laws.  The
Company may issue stop transfer instructions to its transfer agent in
connection with such restrictions.


 


(c)           Applicability
of Restrictions.  Neither any
restrictions of any legend described in this warrant nor the requirements of Section 7(b) above
shall apply to any transfer of, or grant of a security interest in, this
warrant (or the Common Stock obtainable upon exercise hereof) or any part
hereof (i) to a partner of the holder if the holder is a partnership or to
a member of the holder if the holder is a limited liability company, (ii) to
a partnership of which the holder is a partner or to a limited liability
company of which the holder is a member, or (iii) to any affiliate of the
holder if the holder is a corporation; provided, however, in any such transfer,
if applicable, the transferee shall on the Company’s request agree in writing
to be bound by the terms of this warrant as if an original holder hereof.


 


8.     Rights as Stockholders; Information.  No holder
of this warrant, as such, shall be entitled to vote or receive dividends or be
deemed the holder of Common Stock issuable upon the exercise hereof for any
purpose, nor shall anything contained herein be construed to confer upon the
holder of this warrant, as such, any of the rights of a stockholder of the
Company or any right to vote for the election of directors or upon any matter
submitted to stockholders at any meeting thereof, or to receive notice of
meetings, or to receive dividends or subscription rights or otherwise until
this warrant shall have been exercised and the Shares purchasable upon the
exercise hereof shall have become deliverable, as provided herein.


 


9.     Right to Convert Warrant into Stock:  Net Issuance.


 


(a)           Right
to Convert.  In addition to and
without limiting the rights of the holder under the terms of this warrant, the
holder shall have the right to convert this warrant or any portion thereof (the
“Conversion Right”) into shares of Common Stock as provided in this Section 9
at any time or from time to time during the term of this warrant.  Upon exercise of the Conversion Right with
respect to a particular number of shares subject to this warrant (the “Converted
Warrant Shares”), the Company shall deliver to the holder (without payment
by the holder of any exercise 


 


5

















 


price or
any cash or other consideration) that number of shares of fully paid and
nonassessable Common Stock as is determined according to the following formula:


 


X =   B - A  


Y


 


Where:           X =                  the
number of shares of Common Stock that shall be issued to holder


 


Y =                  the fair market
value of one share of Common Stock


 


A =                 the
aggregate Warrant Price of the specified number of Converted Warrant Shares
immediately prior to the exercise of the Conversion Right (i.e.,
the number of Converted Warrant Shares multiplied by the Warrant Price)


 


B =                  the
aggregate fair market value of the specified number of Converted Warrant Shares
(i.e., the number of Converted Warrant
Shares multiplied by the fair market value of one Converted Warrant Share)


 


No fractional shares
shall be issuable upon exercise of the Conversion Right, and, if the number of
shares to be issued determined in accordance with the foregoing formula is
other than a whole number, the Company shall pay to the holder an amount in
cash equal to the fair market value of the resulting fractional share on the
Conversion Date (as hereinafter defined).


 


(b)           Method
of Exercise.  The Conversion Right
may be exercised by the holder by the surrender of this warrant at the
principal office of the Company together with a written statement (which may be
in the form of Exhibit A-1) specifying that the holder thereby intends to
exercise the Conversion Right and indicating the number of shares subject to
this warrant which are being surrendered (referred to in Section 9(a) hereof
as the Converted Warrant Shares) in exercise of the Conversion Right.  Such conversion shall be effective upon
receipt by the Company of this warrant together with the aforesaid written
statement, or on such later date as is specified therein (the “Conversion
Date”).  Certificates for the shares
issuable upon exercise of the Conversion Right and, if applicable, a new
warrant evidencing the balance of the shares remaining subject to this warrant,
shall be issued as of the Conversion Date and shall be delivered to the holder
within thirty (30) days following the Conversion Date.


 


(c)           Determination
of Fair Market Value.  For purposes
of this Section 9, “fair market value” of a share of Common Stock
as of a particular date (the “Determination Date”) shall mean:  (i) if traded on a securities exchange,
the fair market value of the Common Stock shall be deemed to be the average of
the closing prices of the Common Stock on such exchange over the five trading
days immediately prior to the Determination Date as reported by Bloomberg
Financial Markets (or a comparable reporting service of national reputation
selected by the Company and reasonably acceptable to the holder if Bloomberg
Financial Markets is not then reporting sales prices of such security) (collectively,
“Bloomberg”); (ii) if traded on the Nasdaq Stock Market or other
over-the-counter system, the fair market value of the Common Stock shall be
deemed to be the 


 


6

















 


average
of the closing bid prices of the Common Stock over the five trading days
immediately prior to the Determination Date as reported by Bloomberg; and (iii) if
there is no public market for the Common Stock, then fair market value shall be
determined by the Board of Directors of the Company in good faith.


 


10.   Representations and Warranties.  The
Company represents and warrants to the holder of this warrant as follows:


 


(a)           This
warrant has been duly authorized and executed by the Company and is a valid and
binding obligation of the Company enforceable in accordance with its terms,
subject to laws of general application relating to bankruptcy, insolvency and
the relief of debtors and the rules of law or principles at equity
governing specific performance, injunctive relief and other equitable remedies.


 


(b)           The
Shares have been duly authorized and reserved for issuance by the Company and,
when issued in accordance with the terms hereof, will be validly issued, fully
paid and nonassessable and free from preemptive rights.


 


(c)           The
execution and delivery of this warrant are not, and the issuance of the Shares
upon exercise of this warrant in accordance with the terms hereof will not be,
inconsistent with the Company’s certificate of incorporation or bylaws, do not
and will not contravene any law, governmental rule or regulation, judgment
or order applicable to the Company, and do not and will not conflict with or
contravene any provision of, or constitute a default under, any indenture,
mortgage, contract or other instrument of which the Company is a party or by
which it is bound or require the consent or approval of, the giving of notice
to, the registration or filing with or the taking of any action in respect of
or by, any federal, state or local government authority or agency or other person,
except for the filing of notices pursuant to federal and state securities laws,
which filings will be effected by the time required thereby.


 


11.   Modification and Waiver.  This
warrant and any provision hereof may be changed, waived, discharged or terminated
only by an instrument in writing signed by the party against which enforcement
of the same is sought.


 


12.   Notices.  Any notice, request,
communication or other document required or permitted to be given or delivered
to the holder hereof or the Company shall be delivered, or shall be sent by
certified or registered mail, postage prepaid, to each such holder at its
address as shown on the books of the Company or to the Company at the address
indicated therefor on the signature page of this warrant.


 


13.   Binding Effect on Successors.  This
warrant shall be binding upon any corporation succeeding the Company by merger,
consolidation or acquisition of all or substantially all of the Company’s
assets, and all of the obligations of the Company relating to the Common Stock
issuable upon the exercise or conversion of this warrant shall survive the
exercise, conversion and termination of this warrant and all of the covenants
and agreements of the Company shall inure to the benefit of the successors and
assigns of the holder hereof.


 


7

















 


14.   Lost Warrants or Stock Certificates.  The
Company covenants to the holder hereof that, upon receipt of evidence
reasonably satisfactory to the Company of the loss, theft, destruction or
mutilation of this warrant or any stock certificate and, in the case of any
such loss, theft or destruction, upon receipt of an indemnity reasonably
satisfactory to the Company, or in the case of any such mutilation upon
surrender and cancellation of such warrant or stock certificate, the Company
will make and deliver a new warrant or stock certificate, of like tenor, in
lieu of the lost, stolen, destroyed or mutilated warrant or stock certificate.


 


15.   Descriptive Headings.  The
descriptive headings of the various sections of this warrant are inserted for
convenience only and do not constitute a part of this warrant.  The language in this warrant shall be
construed as to its fair meaning without regard to which party drafted this
warrant.


 


16.   Governing Law.  This warrant shall be construed
and enforced in accordance with, and the rights of the parties shall be
governed by, the laws of the State of California.


 


17.   Remedies.  In case any one or more of the
covenants and agreements contained in this warrant shall have been breached,
the holder hereof (in the case of a breach by the Company), or the Company (in
the case of a breach by a holder), may proceed to protect and enforce their or
its rights either by suit in equity and/or by action at law, including, but not
limited to, an action for damages as a result of any such breach and/or an
action for specific performance of any such covenant or agreement contained in
this warrant.


 


18.   No Impairment of Rights.  The
Company will not, by amendment of its certificate of incorporation or through
any other means, avoid or seek to avoid the observance or performance of any of
the terms of this warrant, but will at all times in good faith assist in the
carrying out of all such terms and in the taking of all such action as may be
necessary or appropriate in order to protect the rights of the holder of this
warrant against impairment.


 


19.   Severability.  The invalidity or
unenforceability of any provision of this warrant in any jurisdiction shall not
affect the validity or enforceability of such provision in any other
jurisdiction, or affect any other provision of this warrant, which shall remain
in full force and effect.


 


20.   Recovery of Litigation Costs.  If any
legal action or other proceeding is brought for the enforcement of this
warrant, or because of an alleged dispute, breach, default, or
misrepresentation in connection with any of the provisions of this warrant, the
successful or prevailing party or parties shall be entitled to recover
reasonable attorneys’ fees and other costs incurred in that action or
proceeding, in addition to any other relief to which it or they may be
entitled.


 


21.   Entire Agreement; Modification.  This
warrant constitutes the entire agreement between the parties pertaining to the
subject matter contained in it and supersedes all prior and contemporaneous
agreements, representations, and undertakings of the parties, whether oral or
written, with respect to such subject matter.


 


(Signature page follows)


 


8

















 


 


 


The Company has caused
this Warrant to Purchase Shares of Common Stock of Sunesis Pharmaceuticals, Inc.
to be duly executed and delivered as of the Date of Grant specified above.


 


	
   

  	
  SUNESIS
  PHARMACEUTICALS, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Address:

  	
  341 Oyster Point
  Boulevard

  
	
   

  	
   

  	
  South San
  Francisco, CA 94080

  
						



 


9

















 


EXHIBIT A-1


 


NOTICE OF EXERCISE


 


To:          SUNESIS
PHARMACEUTICALS, INC. (the “Company”)


 


1.             The
undersigned hereby:


 


o            elects
to purchase
              
shares of common stock of the Company pursuant to the terms of the attached
warrant, and tenders herewith payment of the purchase price of such shares in
full, or


 


o            elects
to exercise its net issuance rights pursuant to Section 9 of the attached
warrant with respect to            
shares of common stock.


 


2.             Please
issue a certificate or certificates representing                  
shares in the name of the undersigned or in such other name or names as are
specified below:


 


	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (Name)

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (Address)

  	
   

  	
   

  



 


3.             The
undersigned represents that the aforesaid shares are being acquired for the
account of the undersigned for investment and not with a view to, or for resale
in connection with, the distribution thereof and that the undersigned has no
present intention of distributing or reselling such shares, all except as in
compliance with applicable securities laws.


 


	
   

  	
   

  	
   

  
	
   

  	
  (Signature)

  



 


 


	
   

  	
   

  
	
  (Date)