Document:

Exhibit 4.13

 

THIS WARRANT AND THE UNDERLYING SECURITIES HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”).  THEY MAY NOT BE SOLD, OFFERED FOR SALE,
PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
AS TO SUCH SECURITIES UNDER THE ACT OR AN OPINION OF COUNSEL SATISFACTORY TO
THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.

 

METABASIS THERAPEUTICS, INC.

 

WARRANT TO PURCHASE COMMON STOCK

 

September
30, 2005

 

Void After September 30, 2010

 

This Certifies That,
for value received, [           ],
or assigns (the “Holder”), is entitled to
subscribe for and purchase at the Exercise Price (defined below) from Metabasis
Therapeutics, Inc., a Delaware corporation, with its principal office at 9390
Towne Centre Drive, Building 300, San Diego, California 92121 (the “Company”)
up to [       ]
shares of the common stock of the Company, par value $0.001 per share
(the “Common Stock”).

 

1.                                      Definitions. 
As used herein, the following terms shall have the following
respective meanings:

 

(a)                                  “Exercise
Period” shall mean the period commencing with the date that is 180 days after
the date hereof and ending five years from the date hereof, unless sooner
terminated as provided below.

 

(b)                                  “Exercise
Price” shall mean $6.74 per share, subject to adjustment pursuant to
Section 5 below.

 

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

 

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
above (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, (ii) by cancellation of
indebtedness, or (iii) pursuant to Section 2.1 below; and

 

(c)                                  This Warrant.

 

Certificates for shares purchased hereunder shall be transmitted by the
transfer agent of the Company to the Holder by crediting the account of the
Holder’s prime broker with the

 

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Depository Trust Company through its Deposit
Withdrawal Agent Commission system if the Company is a participant in such
system (and so long as the legend may be removed in accordance with Section
4.10 of the Securities Purchase Agreement dated September 30, 2005, by and
among the Company and the purchasers indicated on the signature pages thereto (the
“Purchase Agreement”)), and otherwise
by physical delivery to the address specified by the Holder in the Notice of
Exercise within five 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 Exercise
Shares shall be deemed to have been issued, and Holder or any other person so
designated to be named therein shall be deemed to have become a holder of
record of such shares for all purposes, as of the date the Warrant has been
exercised by payment to the Company of the Exercise Price.

 

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.

 

2.1                               Net
Exercise.  Notwithstanding any
provisions herein to the contrary, if during the Exercise Period 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, or by cancellation of
indebtedness, 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 shares of Common Stock to be issued to
  the Holder

  
	
   

  	
   

  	
   

  	
   

  
	
  Y =

  	
   

  	
   

  	
  the number
  of shares of Common Stock purchasable under the Warrant or, if only a portion
  of the Warrant is being exercised, the portion of the 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 National Market or other trading
market where such security is listed or traded as reported by Bloomberg
Financial Markets (or a comparable reporting service of national

 

2

 

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 10 consecutive trading days immediately preceding such date, or (ii) if
the Nasdaq National 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 the Holder, exercisable, in the aggregate, for the balance of the number of
shares of Common Stock remaining available for purchase under the 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.

 

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, 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

 

3.3                               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 (other than a cash dividend which is the
same as cash dividends paid in previous quarters) or other distribution, the
Company shall mail to the Holder, at least 20 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 20 days prior to
the date of the occurrence of any such event, a notice specifying such date.

 

4.                                      Representations of Holder.

 

4.1                               Acquisition
of Warrant for Personal Account.  The Holder represents and warrants that it is
acquiring the Warrant solely for its account for investment and not with a view
to or for sale or distribution of said Warrant or any part thereof.  The Holder also represents that the entire
legal and beneficial interests of the Warrant and Exercise Shares the Holder is
acquiring is being acquired for, and will be held for, its account only.

 

4.2                               Securities
Are Not Registered.

 

(a)                                  The Holder
understands that the Warrant and the Exercise Shares have not been registered
under the Securities Act of 1933, as amended (the “Act”)
on the basis that no distribution or public offering of the stock of the
Company is to be effected.  The Holder
realizes that the basis for the exemption may not be present if,
notwithstanding its representations, the Holder has a present intention of
acquiring the securities for a fixed or determinable period in the future,
selling (in connection with a distribution or otherwise), granting any
participation in, or otherwise distributing the securities.  The Holder has no such present intention
except as set forth in Article 7 of the Purchase Agreement.

 

(b)                                  The Holder recognizes
that the Warrant and the Exercise Shares must be held indefinitely unless they
are subsequently registered under the Act or an exemption from such
registration is available.  The Holder
recognizes that the Company will register the Exercise Shares pursuant to the
provisions of Article 7 of the Purchase Agreement.

 

(c)                                  The Holder is aware
that neither the Warrant nor the Exercise Shares may be sold pursuant to Rule
144 adopted under the Act unless certain conditions are met, including, among
other things, the existence of a public market for the shares, the availability
of certain current public information about the Company, the resale following
the required holding period under Rule 144 and the number of shares being sold
during any three-month period not exceeding specified limitations.

 

4.3                               Disposition of Warrant and Exercise Shares.

 

(a)                                  The
Holder further agrees not to make any disposition of all or any part of the
Warrant or Exercise Shares in any event unless and until:

 

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(i)                                    The Company shall
have received a letter secured by the Holder from the Securities and Exchange
Commission stating that no action will be recommended to the Commission with
respect to the proposed disposition; or

 

(ii)                                There is then in effect
a registration statement under the Act covering such proposed disposition and
such disposition is made in accordance with said registration statement; or

 

(iii)                            The Holder shall have
furnished the Company with an opinion of counsel, reasonably satisfactory to
the Company, for the Holder to the effect that such disposition will not
require registration of such Warrant or Exercise Shares under the Act or any
applicable state securities laws; provided, however,
that no such opinion of counsel shall be required for sales (a) under Rule 144,
(b) to one of its nominees, affiliates or a nominee thereof, (c) to a pension
or profit-sharing fund established and maintained for its employees or for the
employees of any affiliate,  (d) from a
nominee to any of the aforementioned persons as beneficial owner of this
Warrant or such Exercise Shares or (e) to a qualified institutional buyer, so
long as such transfer is effected in compliance with Rule 144A under the
Securities Act.

 

(b)                                  The Holder
understands and agrees that, subject to Section 4.10 of the Purchase Agreement,
all certificates evidencing the shares to be issued to the Holder may bear the
following legend:

 

“THESE SECURITIES
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“ACT”).  THEY MAY NOT BE SOLD, OFFERED
FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT AS TO THE SECURITIES UNDER THE ACT OR AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.”

 

5.                                      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 the Warrant in the aggregate and the
Exercise Price shall be correspondingly adjusted to give the Holder of the
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
the 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 Common Stock of the Company (or any shares of
stock or other securities at the time receivable upon the exercise of this
Warrant) shall have received or become entitled to receive, without payment
therefor,

 

5

 

(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 (other than a dividend or distribution covered
in Section 5(a) above),

 

(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 (other than shares of Common Stock pursuant to Section 5(a)
above),

 

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.

 

6.                                      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.

 

7.                                      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 5
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, at the option of the Holder, (a) upon exercise of this
Warrant, 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

 

6

 

which
this Warrant is exercisable immediately prior to such event.   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 7 and insuring that this Warrant (or any such
replacement security) will be similarly adjusted upon any subsequent
transaction analogous to a Fundamental Transaction.

 

8.                                      No Stockholder Rights.  This Warrant in and of itself
shall not entitle the Holder to any voting rights or other rights as a
stockholder of the Company.

 

9.                                      Transfer of Warrant.  Subject to applicable laws and the
restriction on transfer set forth on the first page of this Warrant and set
forth in the Purchase 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.

 

10.                               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 the Warrant so lost, stolen, mutilated or
destroyed.  Any such new Warrant shall
constitute an original contractual obligation of the Company, whether or not
the allegedly lost, stolen, mutilated or destroyed Warrant shall be at any time
enforceable by anyone.

 

11.                               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 Purchase
Agreement or at such other address as the Company or Holder may designate by 10
days advance written notice to the other parties hereto.

 

7

 

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

 

13.                               Governing Law. 
This Warrant and all rights, obligations and liabilities
hereunder shall be governed by the laws of the State of California.

 

[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 September 30, 2005.

 

	
   

  	
  METABASIS THERAPEUTICS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
  Paul K. Laikind

  
	
   

  	
   

  
	
   

  	
  Title:  

  	
  President and Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  Address: 

  	
  9390 Towne Centre Drive, Building 300

  
	
   

  	
   

  	
  San Diego,
  California 92121

  
				

 

 

NOTICE OF EXERCISE

 

TO:  Metabasis Therapeutics, Inc.

 

(1)                                 o                                    The
undersigned hereby elects to purchase           
shares of the Common Stock of Metabasis
Therapeutics, 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.

 

o                                    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 a
certificate or certificates representing said shares of Common Stock of the
Company in the name of the undersigned or in such other name as is specified
below:

 

	
   

  
	
  (Name)

  
	
   

  
	
   

  
	
   

  
	
  (Address)

  

 

(3)                                 The undersigned
represents that (i) the aforesaid shares of Common Stock 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, other than
as contemplated by Article 7 of the Securities Purchase Agreement dated as of
September 30, 2005 by and among the Company and the purchasers named therein
(the “Purchase Agreement”); (ii) the
undersigned is aware of the Company’s business affairs and financial condition
and has acquired sufficient information about the Company to reach an informed
and knowledgeable decision regarding its investment in the Company; (iii) the
undersigned is experienced in making investments of this type and has such
knowledge and background in financial and business matters that the undersigned
is capable of evaluating the merits and risks of this investment and protecting
the undersigned’s own interests; (iv) the undersigned understands that the
shares of Common Stock issuable upon exercise of this Warrant have not been
registered (except to the extent a registration statement pursuant to and as
contemplated by Article 7 of the Purchase Agreement is effective) under the
Securities Act of 1933, as amended (the “Securities Act”),
by reason of a specific exemption from the registration provisions of the
Securities Act, which exemption depends upon, among other things, the bona fide
nature of the investment intent as expressed herein, and, because such
securities have not been registered under the Securities Act, they must be held
indefinitely unless subsequently registered under the Securities Act or an
exemption from such registration is available; (v) the undersigned is aware
that the aforesaid shares of Common Stock may not be sold pursuant to Rule 144
adopted under the Securities Act unless certain conditions are met and until
the undersigned has held the shares for the number of years prescribed by Rule
144, that among the conditions for use of the Rule is the availability of
current information to the public about the

 

 

Company; and (vi) the undersigned agrees not to make any disposition of
all or any part of the aforesaid shares of Common Stock unless and until there
is then in effect a registration statement under the Securities Act covering
such proposed disposition and such disposition is made in accordance with said
registration statement, or the undersigned has provided upon the Company’s
reasonable request, an opinion of counsel satisfactory to the Company, stating
that such registration is not required.

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (Date)

  	
   

  	
  (Signature)

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (Print name)

  	
   

  

 

 

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: 

  	
   

  	
  , 20

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  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.Exhibit 10.1

 

STOCK OPTION AGREEMENT dated as of «Month»
«day», «year», between BED BATH &
BEYOND INC. (the “Company”) and «Name» (“you”).

 

1.  Option
Grant.  The Company grants you an
option (the “Option”) to purchase up to «Shares»
shares of the Company’s Common Stock at a price of $«Price» per share.  The
Option is not exercisable now but becomes exercisable in installments, which
are cumulative, so that «Vesting   »%
of the number of shares originally subject to the Option will vest and become
exercisable on each of the dates described on the Vesting Schedule below.

 

2.  Option
Plan.  You agree that the Option is
entirely subject to the terms of the Company’s 2004 Stock Option Plan (the “Plan”),
which is described in the Prospectus for the Plan.

 

3.  Type
of Option.  The Option is not
intended to qualify as an “incentive stock option” under Section 422 of
the Internal Revenue Code.

 

4.  Termination.  The Option terminates on the eighth
anniversary of the date of this Agreement and as otherwise provided in the
Plan.  The Option will immediately
terminate upon your termination of employment with the Company, except that (i) if
termination is because of your death or disability, the portion of the Option
vested and unexercised as of such termination date (the “Vested Portion”) will
remain exercisable for 12 months after termination and (ii) if termination
is for any other reason, excluding cause, the Vested Portion will remain
exercisable for three months after termination, although in all cases the
Option will never be exercisable after the eighth anniversary of this
Agreement.  Upon termination for cause,
the Vested Portion terminates immediately, together with the balance of the
Option.  Notwithstanding any other
provision of this Agreement, the provisions regarding the termination of this
Option (and the provisions regarding the termination of previously granted
options) shall be subject to the terms of any separate Employment Agreement,
Severance Agreement or other similar agreement entered into between you and the
Company.

 

5.  Exercise.  You may exercise the Option by delivering to
the Company your signed, written notice of the number of shares covered by your
exercise, together with the full purchase price.  Payment may be made by certified check, bank
draft, or money order payable to the order of the Company or, if permitted by
the Committee that administers the Plan (the “Committee”), through delivery of
shares of the Company’s Common Stock. 
The Committee may require you to pay the amount needed (or to make other
arrangements) to pay any withholding taxes.

 

6.  Transfer
Restriction.  Unless otherwise
permitted by the Committee, the Option is non-transferable, except that, in
case of your death, it may be transferred by will or the laws of descent and
distribution.  Only you (or your guardian
or legal representative) may exercise the Option.

 

7.  Notice.  Any notice or communication to the Company
concerning the Option must be in writing and delivered in person, or by United
States mail, to the following address (or another address specified by the
Company):

 

Bed Bath & Beyond Inc.

Finance Department – Stock Administration

650 Liberty Avenue

Union, New Jersey 07083

 

1

 

	
  BED BATH & BEYOND INC.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  
	
  Co-Chairman
  of the Board of Directors or

  	
  «Name»

  	
   

  
	
  Chief
  Executive Officer

  	
   

  
					

 

VESTING
SCHEDULE

 

Total Option
Grant:  «Shares»
shares

 

	
  Date on Which Installment First

  Vests and Becomes Exercisable

  	
   

  	
  Number of Shares in Installment

  
	
   

  	
   

  	
   

  
	
  «Month» «day», «vyear1»

  	
   

  	
  «Vesting  »%
  of the number of shares

  
	
   

  	
   

  	
  originally
  subject to the Option

  
	
  «Month» «day», «vyear2»

  	
   

  	
  «Vesting  »%
  of the number of shares

  
	
   

  	
   

  	
  originally
  subject to the Option

  
	
  «Month» «day», «vyear3»

  	
   

  	
  «Vesting  »%
  of the number of shares

  
	
   

  	
   

  	
  originally
  subject to the Option

  
	
  «Month» «day», «vyear4»

  	
   

  	
  «Vesting  »%
  of the number of shares

  
	
   

  	
   

  	
  originally
  subject to the Option

  
	
  «Month» «day», «vyear5»

  	
   

  	
  «Vesting  »%
  of the number of shares

  
	
   

  	
   

  	
  originally
  subject to the Option

  

 

2

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00091-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00091-of-00352.parquet"}]]