exv10w2






Exhibit 10.2




ARIAD PHARMACEUTICALS, INC.




WARRANT TO PURCHASE COMMON STOCK




To Purchase [                    ] Shares of Common Stock




Date of Issuance: February 25, 2009




VOID AFTER FEBRUARY 25, 2012




     THIS CERTIFIES THAT, for value received, [                    ], or permitted registered assigns (the
“HOLDER”), is entitled to subscribe for and purchase at the Exercise Price (defined below) from
ARIAD Pharmaceuticals, Inc., a Delaware corporation (the “COMPANY”), up to [                    ] shares of the
common stock of the Company, par value $0.001 per share (the “COMMON STOCK”). This warrant is one
of a series of warrants issued by the Company as of the date hereof (individually a “WARRANT”;
collectively, the “WARRANTS”) pursuant to that certain subscription agreement between the Company
and the Holder, dated as of February 19, 2009 (the “SUBSCRIPTION AGREEMENT”).



     1. DEFINITIONS. Capitalized terms used herein but not otherwise defined herein shall
have their respective meanings as set forth in the Subscription Agreement. As used herein, the
following terms shall have the following respective meanings:



          (A) “Eligible Market” means any of the New York Stock Exchange, the American Stock Exchange,
The NASDAQ Global Market, The NASDAQ Global Select Market or The NASDAQ Capital Market.




          (B) “Exercise Period” shall mean the period commencing six (6) months after the date hereof
and ending 5:00 P.M. New York City time on February 25, 2012, unless sooner terminated as provided
below.




          (C) “Exercise Price” shall mean $2.15 per share, subject to adjustment pursuant to Section
4 below.




          (D) “Exercise Shares” shall mean the shares of Common Stock issuable upon exercise of this
Warrant.




          (E) “Trading Day” shall mean (a) any day on which the Common Stock is listed or quoted and
traded on its primary Trading Market, (b) if the Common Stock is not then listed or quoted and
traded on any Eligible Market, then a day on which trading occurs on the OTC Bulletin Board (or any
successor thereto), or (c) if trading does not occur on the OTC Bulletin Board (or any successor
thereto), any Business Day.




          (F) “Trading Market” shall mean the NASDAQ Global Market or any other Eligible Market, or any
national securities exchange, market or trading or quotation facility on which the Common Stock is
then listed or quoted.




 









 





     2. EXERCISE OF WARRANT. The rights represented by this Warrant may be exercised in
whole or in part at any time during the Exercise Period, by delivery of the following to the
Company at its address set forth on the signature page hereto (or at such other address as it may
designate by notice in writing to the Holder):



          (A) An executed Notice of Exercise in the form attached hereto;




          (B) Payment of the Exercise Price either (i) in cash or by check, or (ii) pursuant to
Section 2.1 below; and




          (C) This Warrant.




          Execution and delivery of the Notice of Exercise shall have the same effect as cancellation of
the original Warrant and issuance of a new Warrant evidencing the right to purchase the remaining
number of Exercise Shares, if any.




     Certificates for shares purchased hereunder shall be transmitted by the Company’s transfer
agent (the “Transfer Agent”) to the Holder by crediting the account of the Holder’s prime broker
with the Depository Trust Company through its Deposit Withdrawal Agent Commission system if the
Company is a participant in such system, and otherwise by physical delivery to the address
specified by the Holder in the Notice of Exercise within three (3) business days from the delivery
to the Company of the Notice of Exercise, surrender of this Warrant and payment of the aggregate
Exercise Price as set forth above. This Warrant shall be deemed to have been exercised on the date
the Exercise Price is received by the Company.



     The person in whose name any certificate or certificates for Exercise Shares are to be issued
upon exercise of this Warrant shall be deemed to have become the holder of record of such shares on
the date on which this Warrant was surrendered and payment of the Exercise Price was made,
irrespective of the date of delivery of such certificate or certificates, except that, if the date
of such surrender and payment is a date when the stock transfer books of the Company are closed,
such person shall be deemed to have become the holder of such shares at the close of business on
the next succeeding date on which the stock transfer books are open.



     Subject to Section 2.4, to the extent permitted by law, the Company’s obligations to
issue and deliver Exercise Shares in accordance with the terms hereof are absolute and
unconditional, irrespective of any action or inaction by the Holder to enforce the same, any waiver
or consent with respect to any provision hereof, the recovery of any judgment against any person or
entity or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or
termination, or any breach or alleged breach by the Holder or any other person or entity of any
obligation to the Company or any violation or alleged violation of law by the Holder or any other
person or entity, and irrespective of any other circumstance which might otherwise limit such
obligation of the Company to the Holder in connection with the issuance of Exercise Shares.
Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder,
at law or in equity including, without limitation, a decree of specific performance and/or
injunctive relief with respect to the Company’s failure to timely deliver Exercise Shares upon
exercise of this Warrant as required pursuant to the terms hereof.



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     2.1 NET EXERCISE. If during the Exercise Period, the Holder is not permitted to sell
Exercise Shares pursuant to the Registration Statement, as defined in the Subscription Agreement,
and the fair market value of one share of the Common Stock is greater than the Exercise Price (at
the date of calculation as set forth below), in lieu of exercising this Warrant by payment of cash
or by check, the Holder may elect to receive shares equal to the value (as determined below) of
this Warrant (or the portion thereof being canceled) by surrender of this Warrant at the principal
office of the Company together with the properly endorsed Notice of Exercise in which event the
Company shall issue to the Holder a number of shares of Common Stock computed using the following
formula:



	 	 	 	 	 
	 
	 	X = Y (A-B)
	 	 
	 
	 	     A	 	 





Where X = the number of Exercise Shares to be issued to the Holder




	 	 	 	 	 
	 

	 	Y =
	 	the number of shares of Common Stock purchasable under this Warrant or, if
only a portion of this Warrant is being exercised, the portion of this Warrant being
canceled (at the date of such calculation)
	 
	 	 	 	 
	 

	 	A =
	 	the fair market value of one share of the Company’s Common Stock (at the date
of such calculation)
	 
	 	 	 	 
	 

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






     For purposes of the above calculation, the “fair market value” of one share of Common Stock
shall mean (i) the average of the closing sales prices for the shares of Common Stock on the Nasdaq
Global Market or other Eligible Market where the Common Stock is listed or traded 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”) for the five (5) consecutive
trading days immediately prior to the Exercise Date, or (ii) if the Nasdaq Global Market is not the
principal Trading Market for the shares of Common Stock, the average of the reported sales prices
reported by Bloomberg on the principal Trading Market for the Common Stock during the same period,
or, if there is no sales price for such period, the last sales price reported by Bloomberg for such
period, or (iii) if neither of the foregoing applies, the last sales price of such security in the
over-the-counter market on the pink sheets or bulletin board for such security as reported by
Bloomberg, or if no sales price is so reported for such security, the last bid price of such
security as reported by Bloomberg or (iv) if fair market value cannot be calculated as of such date
on any of the foregoing bases, the fair market value shall be as determined by the Board of
Directors of the Company in the exercise of its good faith judgment.



          2.2 ISSUANCE OF NEW WARRANTS. Upon any partial exercise of this Warrant, the Company,
at its expense, will forthwith and, in any event within five business days, issue and deliver to
the Holder a new warrant or warrants of like tenor, registered in the name of



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the Holder, exercisable, in the aggregate, for the balance of the number of shares of Common
Stock remaining available for purchase under this Warrant.




          2.3 PAYMENT OF TAXES AND EXPENSES. The Company shall pay any recording, filing, stamp
or similar tax which may be payable in respect of any transfer involved in the issuance of, and the
preparation and delivery of certificates (if applicable) representing, (i) any Exercise Shares
purchased upon exercise of this Warrant and/or (ii) new or replacement warrants in the Holder’s
name or the name of any transferee of all or any portion of this Warrant; provided, however, that
the Company shall not be required to pay any tax which may be payable in respect of any transfer
involved in the issuance, delivery or registration of any certificates for Exercise Shares or
Warrants in a name other than that of the Holder. The Holder shall be responsible for all other
tax liability that may arise as a result of holding or transferring this Warrant or receiving
Exercise Shares upon exercise hereof.




          2.4 EXERCISE LIMITATIONS; HOLDER’S RESTRICTIONS. A Holder shall not have the right to
exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent
that after giving effect to such issuance after exercise, such Holder (together with such Holder’s
affiliates), as set forth on the applicable Notice of Exercise, would beneficially own in excess of
9.9% of the number of shares of the Common Stock outstanding immediately after giving effect to
such issuance. For purposes of this Section 2.4, the number of shares of Common Stock
beneficially owned by such Holder and its affiliates shall include the number of shares of Common
Stock issuable upon exercise of this Warrant with respect to which the determination of such
sentence is being made, but shall exclude the number of shares of Common Stock which would be
issuable upon (A) exercise of the remaining, nonexercised portion of this Warrant beneficially
owned by such Holder or any of its affiliates and (B) exercise or conversion of the unexercised or
nonconverted portion of any other securities of the Company (including, without limitation, any
other shares of Common Stock or Warrants) subject to a limitation on conversion or exercise
analogous to the limitation contained herein beneficially owned by such Holder or any of its
affiliates. Except as set forth in the preceding sentence, for purposes of this Section
2.4, beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange
Act, it being acknowledged by a Holder that the Company is not representing to such Holder that
such calculation is in compliance with Section 13(d) of the Exchange Act and such Holder is solely
responsible for any schedules required to be filed in accordance therewith. To the extent that the
limitation contained in this Section 2.4 applies, the determination of whether this Warrant
is exercisable (in relation to other securities owned by such Holder) and of which a portion of
this Warrant is exercisable shall be in the sole discretion of a Holder, and the submission of a
Notice of Exercise shall be deemed to be each Holder’s determination of whether this Warrant is
exercisable (in relation to other securities owned by such Holder) and of which portion of this
Warrant is exercisable, in each case subject to such aggregate percentage limitation, and the
Company shall have no obligation to verify or confirm the accuracy of such determination. For
purposes of this Section 2.4, in determining the number of outstanding shares of Common
Stock, a Holder may rely on the number of outstanding shares of Common Stock as reflected in (x)
the Company’s most recent Form 10-Q or Form 10-K, as the case may be, (y) a more recent public
announcement by the Company or (z) any other notice by the Company or the Company’s Transfer Agent
setting forth the number of shares of Common Stock outstanding. Upon the written or oral request
of a Holder, the Company shall within two Trading Days confirm orally and in writing to such Holder
the number of shares of



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Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock
shall be determined after giving effect to the conversion or exercise of securities of the Company,
including this Warrant, by such Holder or its affiliates since the date as of which such number of
outstanding shares of Common Stock was reported. The provisions of this Section 2.4 may be
waived by such Holder, at the election of such Holder, upon not less than 61 days’ prior notice to
the Company, and the provisions of this Section 2.4 shall continue to apply until such 61st
day (or such later date, as determined by such Holder, as may be specified in such notice of
waiver).




     3. COVENANTS OF THE COMPANY.



          3.1 COVENANTS AS TO EXERCISE SHARES. The Company covenants and agrees that all
Exercise Shares that may be issued upon the exercise of the rights represented by this Warrant
will, upon issuance, be validly issued and outstanding, fully paid and nonassessable, and free from
all taxes, liens and charges with respect to the issuance thereof. The Company further covenants
and agrees that the Company will at all times during the Exercise Period, have authorized and
reserved, free from preemptive rights, 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 Exercise Period
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.




          3.2 NO IMPAIRMENT. Except and to the extent as waived or consented to by the holder
of the Warrants representing at least two-thirds of the number of shares of Common Stock then
subject to outstanding Warrants, the Company will not, by amendment of its Certificate of
Incorporation or through any reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms to be observed or performed hereunder by the Company,
but will at all times in good faith assist in the carrying out of all the provisions of this
Warrant and in the taking of all such action as may be necessary or appropriate in order to protect
the exercise rights of the Holder against impairment.




          3.3 NOTICES OF RECORD DATE AND CERTAIN OTHER EVENTS. In the event of any taking by
the Company of a record of the holders of any class of securities for the purpose of determining
the holders thereof who are entitled to receive any dividend or other distribution, the Company
shall mail to the Holder, at least ten (10) days prior to the date on which any such record is to
be taken for the purpose of such dividend or distribution, a notice specifying such date. In the
event of any voluntary dissolution, liquidation or winding up of the Company, the Company shall
mail to the Holder, at least ten (10) days prior to the date of the occurrence of any such event, a
notice specifying such date. In the event the Company authorizes or approves, enters into any
agreement contemplating, or solicits stockholder approval for any Fundamental Transaction, as
defined in Section 6 herein, the Company shall mail to the Holder, at least ten (10) days
prior to the date of the occurrence of such event, a notice specifying such date.




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     4. ADJUSTMENT OF EXERCISE PRICE AND SHARES.



               (A) In the event of changes in the outstanding Common Stock of the Company by reason of stock
dividends, split-ups, recapitalizations, reclassifications, combinations or exchanges of shares,
separations, reorganizations, liquidations, consolidation, acquisition of the Company (whether
through merger or acquisition of substantially all the assets or stock of the Company), or the
like, the number, class and type of shares available under this Warrant in the aggregate and the
Exercise Price shall be correspondingly adjusted to give the Holder of this Warrant, on exercise
for the same aggregate Exercise Price, the total number, class, and type of shares or other
property as the Holder would have owned had this Warrant been exercised prior to the event and had
the Holder continued to hold such shares until the event requiring adjustment. The form of this
Warrant need not be changed because of any adjustment in the number of Exercise Shares subject to
this Warrant.



               (B) If at any time or from time to time the holders of all outstanding shares of Common Stock
of the Company (or any shares of stock or other securities at the time receivable upon the exercise
of this Warrant) pursuant to a dividend or distribution declared by the Company (other than a
dividend or distribution covered in Section 4(A) above), shall have received or become
entitled to receive, without payment therefor.



                    (I) Common Stock or any shares of stock or other securities which are at any time directly or
indirectly convertible into or exchangeable for Common Stock, or any rights or options to subscribe
for, purchase or otherwise acquire any of the foregoing by way of dividend or other distribution;



                    (II) any cash paid or payable otherwise than as a cash dividend; or



                    (III) Common Stock or additional stock or other securities or property (including cash) by way
of spinoff, split-up, reclassification, combination of shares or similar corporate rearrangement,
then and in each such case, the Holder hereof will, upon the exercise of this Warrant, be entitled
to receive, in addition to the number of shares of Common Stock receivable thereupon, and without
payment of any additional consideration therefor, the amount of stock and other securities and
property (including cash in the cases referred to in clauses (II) and (III) above) which such
Holder would hold on the date of such exercise had such Holder been the holder of record of such
Common Stock as of the date on which holders of Common Stock received or became entitled to receive
such shares or all other additional stock and other securities and property.



               (C) Upon the occurrence of each adjustment pursuant to this Section 4, the Company at
its expense will, at the written request of the Holder, promptly compute such adjustment in
accordance with the terms of this Warrant and prepare a certificate setting forth such adjustment,
including a statement of the adjusted Exercise Price and adjusted number or type of Exercise Shares
or other securities issuable upon exercise of this Warrant (as applicable), describing the
transactions giving rise to such adjustments and showing in detail the facts upon which such
adjustment is based. Upon written request, the Company will promptly deliver a copy of each such
certificate to the Holder and to the Transfer Agent.



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     5. FRACTIONAL SHARES. No fractional shares shall be issued upon the exercise of this
Warrant as a consequence of any adjustment pursuant hereto. All Exercise Shares (including
fractions) issuable upon exercise of this Warrant may be aggregated for purposes of determining
whether the exercise would result in the issuance of any fractional share. If, after aggregation,
the exercise would result in the issuance of a fractional share, the Company shall, in lieu of
issuance of any fractional share, pay the Holder otherwise entitled to such fraction a sum in cash
equal to the product resulting from multiplying the then current fair market value of an Exercise
Share by such fraction.



     6. FUNDAMENTAL TRANSACTIONS. If, at any time while this Warrant is outstanding, (i)
the Company effects any merger of the Company with or into another entity, (ii) the Company effects
any sale of all or substantially all of its assets in one or a series of related transactions,
(iii) any tender offer or exchange offer (whether by the Company or another individual or entity)
is completed pursuant to which holders of Common Stock are permitted to tender or exchange their
shares for other securities, cash or property or (iv) the Company effects any reclassification of
the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively
converted into or exchanged for other securities, cash or property (other than as a result of a
subdivision or combination of shares of Common Stock covered by Section 4 above) (in any
such case, a “FUNDAMENTAL TRANSACTION”), then, upon any subsequent exercise of this Warrant, the
Holder shall have the right to receive, for each Warrant Share that would have been issuable upon
such exercise immediately prior to the occurrence of such Fundamental Transaction (disregarding any
limitation on exercise contained herein solely for the purpose of such determination), the number
of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the
surviving corporation, and any additional consideration (the “ALTERNATE CONSIDERATION”) receivable
upon or as a result of such reorganization, reclassification, merger, consolidation or disposition
of assets by a Holder of the number of shares of Common Stock for which this Warrant is exercisable
immediately prior to such event (disregarding any limitation on exercise contained herein solely
for the purpose of such determination). For purposes of any such exercise, the determination of
the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based
on the amount of Alternate Consideration issuable in respect of one share of Common Stock in such
Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate
Consideration in a reasonable manner reflecting the relative value of any different components of
the Alternate Consideration. If holders of Common Stock are given any choice as to the securities,
cash or property to be received in a Fundamental Transaction, then the Holder shall be given the
same choice as to the Alternate Consideration it receives upon any exercise of this Warrant
following such Fundamental Transaction. To the extent necessary to effectuate the foregoing
provisions, any successor to the Company or surviving entity in such Fundamental Transaction shall
issue to the Holder a new warrant consistent with the foregoing provisions and evidencing the
Holder’s right to exercise such warrant into Alternate Consideration. The terms of any agreement
pursuant to which a Fundamental Transaction is effected shall include terms requiring any such
successor or surviving entity to comply with the provisions of this Section 6 and ensuring
that this Warrant (or any such replacement security) will be similarly adjusted upon any subsequent
transaction analogous to a Fundamental Transaction.



     Notwithstanding anything to the contrary, in the event of a Fundamental Transaction and the
amount of the Alternate Consideration is less than the Exercise Price, then the Company or



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any successor entity shall pay at the Holder’s option, exercisable at any time concurrently
with or within thirty (30) days after the consummation of the Fundamental Transaction, an amount of
cash equal to the value of this Warrant as determined in accordance with the Black Scholes Option
Pricing Model obtained from the “OV” function on Bloomberg L.P. using (i) a price per share of
Common Stock equal to the Volume-Weighted Average Price of the Common Stock for the Trading Day
immediately preceding the date of consummation of the applicable Fundamental Transaction, (ii) a
risk-free interest rate corresponding to the U.S. Treasury rate for a period equal to the remaining
term of this Warrant as of the date of consummation of the applicable Fundamental Transaction and
(iii) an expected volatility equal to the thirty (30) day volatility obtained from the “HVT”
function on Bloomberg L.P. determined as of the end of the Trading Day immediately following the
public announcement of the applicable Fundamental Transaction.



     7. NO STOCKHOLDER RIGHTS. Other than as provided in Section 3.3 or otherwise
herein, this Warrant in and of itself shall not entitle the Holder to any voting rights or other
rights as a stockholder of the Company.



     8. TRANSFER OF WARRANT. Subject to applicable laws and the restriction on transfer
set forth in the Subscription Agreement, this Warrant and all rights hereunder are transferable, by
the Holder in person or by duly authorized attorney, upon delivery of this Warrant and the form of
assignment attached hereto to any transferee designated by Holder. The transferee shall sign an
investment letter in form and substance reasonably satisfactory to the Company and its counsel. Any
proposed transfer of all or any portion of this Warrant in violation of the provisions of this
warrant or the Subscription Agreement shall be null and void. Upon surrender of this Warrant and
delivery of an assignment, the Company shall execute and deliver a new Warrant or Warrants in the
name of the transferee or transferees, as applicable, and in the denomination or denominations
specified in such instrument of assignment, and shall issue to the transferor a new Warrant
evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be
cancelled.



     9. LOST, STOLEN, MUTILATED OR DESTROYED WARRANT. If this Warrant is lost, stolen,
mutilated or destroyed, the Company may, on such terms as to indemnity or otherwise as it may
reasonably impose (which shall, in the case of a mutilated Warrant, include the surrender thereof),
issue a new Warrant of like denomination and tenor as this Warrant so lost, stolen, mutilated or
destroyed. Any such new Warrant shall constitute an original contractual obligation of the Company.



     10. NOTICES, ETC. All notices required or permitted hereunder shall be in writing and
shall be deemed effectively given: (a) upon personal delivery to the party to be notified, (b) when
sent by confirmed telex or facsimile if sent during normal business hours of the recipient, if not,
then on the next business day, (c) five days after having been sent by registered or certified
mail, return receipt requested, postage prepaid, or (d) one day after deposit with a nationally
recognized overnight courier, specifying next day delivery, with written verification of receipt.
All communications shall be sent to the Company at the address listed on the signature page hereto
and to Holder at the applicable address set forth on the applicable signature page to the
Subscription Agreement or at such other address as the Company or Holder may designate by ten (10)
days advance written notice to the other parties hereto.



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     11. ACCEPTANCE. Receipt of this Warrant by the Holder shall constitute acceptance of
and agreement to all of the terms and conditions contained herein.



     12. GOVERNING LAW. This Warrant and all rights, obligations and liabilities hereunder
shall be governed by, and construed in accordance with, the internal laws of the State of New York,
without giving effect to the principles of conflicts of law that would require the application of
the laws of any other jurisdiction.



     13. AMENDMENT OR WAIVER. Any term of this Warrant may be amended or waived (either
generally or in a particular instance and either retroactively or prospectively) with the written
consent of the Company and the holders of the Warrants representing at least two-thirds of the
number of shares of Common Stock then subject to outstanding Warrants. Notwithstanding the
foregoing, (a) this Warrant may be amended and the observance of any term hereunder may be waived
without the written consent of the Holder only in a manner which applies to all Warrants in the
same fashion and (b) the number of Exercise Shares subject to this Warrant and the Exercise Price
of this Warrant may not be amended, and the right to exercise this Warrant may not be waived,
without the written consent of the Holder. The Company shall give prompt written notice to the
Holder of any amendment hereof or waiver hereunder that was effected without the Holder’s written
consent. No waivers of any term, condition or provision of this Warrant, in any one or more
instances, shall be deemed to be, or construed as, a further or continuing waiver of any such term,
condition or provision.



[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]




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     IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its duly authorized
officer as of February 25, 2009.



	 	 	 	 	 	 	 
	 	 	ARIAD PHARMACEUTICALS, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	26 Landsdowne Street	 	 
	 	 	Cambridge, MA 02139	 	 







 









 








NOTICE OF EXERCISE




TO: ARIAD PHARMACEUTICALS, INC.




     (1) [_] The undersigned hereby elects to purchase [                    ] shares of the common stock, par
value $0.001 (the “Common Stock”), of ARIAD PHARMACEUTICALS, INC. (the “Company”) pursuant to the
terms of the attached Warrant, and tenders herewith payment of the exercise price in full, together
with all applicable transfer taxes, if any.



           [_] The undersigned hereby elects to purchase [                    ] shares of Common Stock of the Company
pursuant to the terms of the net exercise provisions set forth in Section 2.1 of the
attached Warrant, and shall tender payment of all applicable transfer taxes, if any.



     (2) Please issue the certificate for shares of Common Stock in the name of, and pay any cash
for any fractional share to:



      



Print or type name




      



Social Security or other Identifying Number




      



Street Address




      



City State Zip Code




     (3) If such number of shares shall not be all the shares purchasable upon the exercise of the
Warrants evidenced by this Warrant, a new warrant certificate for the balance of such Warrants
remaining unexercised shall be registered in the name of and delivered to:



     Please insert social security or other identifying number:                                         



      



(Please print name and address)




      




     Dated:




 









 





	 	 	 	 	 
	(Date)

	 	 

(Signature)
	 	 
	 
	 	 	 	 
	 

	 	 

(Print name)
	 	 







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ASSIGNMENT FORM




     (To assign the foregoing Warrant, execute this form and supply required information. Do not
use this form to purchase shares.)



     FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned
to



	 	 	 	 	 
	Name:
	 	 	 	 
	 

	 	 

(Please Print)
	 	 
	 
	 	 	 	 
	Address:
	 	 	 	 
	 

	 	 

(Please Print)
	 	 






Dated: [                    ], 200[_]




	 	 	 	 	 
	Holder’s Signature:

	 	 

	 	 
	 
	 	 	 	 
	Holder’s Address:
	 	 	 	 
	 

	 	 

	 	 





NOTE: The signature to this Assignment Form must correspond with the name as it appears on the
face of the Warrant, without alteration or enlargement or any change whatever. Officers of
corporations and those acting in a fiduciary or other representative capacity should file proper
evidence of authority to assign the foregoing Warrant.