Document:

EXHIBIT
10.3

BIOJECT
MEDICAL TECHNOLOGIES INC.

FORM OF CONVERTIBLE NOTE PURCHASE
AND WARRANT AGREEMENT

 

This Convertible Note
Purchase and Warrant Agreement (the “Agreement”) is
made as of [                       ],
2007, by and between Bioject Medical Technologies
Inc., an Oregon corporation (the “Company”),
and                       
(“Purchaser”).

RECITALS

The Company desires to
issue and sell and the Purchaser desires to purchase a convertible subordinated
promissory note in substantially the form attached to this Agreement as Exhibit A (the “Notes”), which
shall be convertible on the terms stated therein into stock of the
Company.  Purchasers shall also receive a
warrant to purchase additional shares of the Company pursuant to the form of
warrant attached hereto as Exhibit B.  The Note, the equity securities issuable upon
conversion thereof (and any securities issuable upon conversion of such equity
securities), the warrant and the equity securities issued upon the Purchaser’s
exercise of the warrant are collectively referred to herein as the “Securities.”  Terms
not otherwise defined in this Agreement shall have the meaning given to them in
the Note attached hereto as Exhibit A.

AGREEMENT

In consideration of the
mutual promises contained herein and other good and valuable consideration,
receipt of which is hereby acknowledged, the parties to this Agreement agree as
follows:

1.             Purchase and Sale of Notes and Warrants.

(a)           Sale and
Issuance of Notes.  Subject to
the terms and conditions of this Agreement, each Purchaser agrees to purchase
at the Closing and the Company agrees to sell and issue to Purchaser a Note in
the principal amount of $                   .  The purchase price of each Note shall be
equal to 100% of the principal amount of such Note.  The Note shall be convertible into equity
securities of the Company as provided for under the Note, and the Warrant shall
be exercisable for equity securities of the Company as provided for under the
Warrant.

(b)           Warrants.  Upon the Closing (as defined in Section 1(c)
below), Purchaser shall receive a warrant to purchase                   shares
of the Company’s common stock in the form attached hereto as Exhibit B (the “Warrant”).    The exercise price of the Warrant (“Exercise Price”) shall be the $0.75 per share price, subject
to adjustment as set forth in the Warrant.

(c)           Closing;
Delivery.

(i)            The initial
purchase and sale of the Notes shall take place at the offices of the Company,
20245 S.W. 95th Ave., Tualatin, OR 97062, at 1:00 p.m., on November     ,
2007 (the “Closing”).  At Closing, the Company shall deliver to
Purchaser the Note to be purchased by Purchaser against payment of the purchase
price therefor by personal check (acceptance by the Company is subject to
receipt of readily available funds) cashier’s check or by wire transfer to the
Company’s bank account and the duly executed Warrant and the parties shall
execute and deliver the Registration Rights Agreement in the form attached
hereto as Exhibit C (the “Registration
Rights Agreement”).

2.             Stock Purchase Agreement.

(a)           Purchaser
understands and agrees that the conversion of the Note into equity securities
of the Company may require such Purchaser’s execution of certain agreements (in
form reasonably agreeable to a majority in interest of the Purchasers) relating
to the purchase and sale of such securities as well as registration,
information and voting rights, if any, relating to such equity securities.

 

(b)           Purchaser agrees to
be bound by the agreements described in Section 2(a).

3.             Representations and Warranties of the Company.  The Company hereby represents and warrants to
each Purchaser that:

(a)           Organization.  The Company is a corporation duly organized
and validly existing under the laws of the State of Oregon and has all
requisite corporate power and authority to carry on its business as now
conducted and as proposed to be conducted.

(b)           Authorization.  All corporate action on the part of the
Company, its officers, directors and shareholders necessary for the
authorization, execution and delivery of this Agreement and the authorization,
sale, issuance and delivery of the Note, the Warrant, the Registration Rights
Agreement, the shares of the Company’s capital stock issuable on conversion or
exercise thereunder, and the performance of all obligations of the Company
hereunder and thereunder, has been taken or will be taken prior to the
Closing.  The shares of Common Stock
issuable upon exercise of the Warrant and pursuant to Section 4.1.1 of the
Note, upon issuance in accordance with the terms of the Warrant or Note, as
applicable, will be duly and validly issued, fully paid, and nonassessable. The
Agreement, the Registration Rights Agreement, the Note and the Warrant, when
executed and delivered by the Company, shall constitute valid and legally
binding obligations of the Company, enforceable against the Company in
accordance with their terms except as limited by applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance, and other laws
of general application affecting enforcement of creditors’ rights generally, as
limited by laws relating to the availability of specific performance,
injunctive relief, or other equitable remedies.

(c)           Governmental
Consents.  All consents,
approvals, orders or authorizations of, or registrations, qualifications,
designations, declarations or filings with, any governmental authority,
required on the part of the Company in connection with the valid execution and
delivery of this Agreement, the Registration Rights Agreement, the offer, sale
or issuance of the Note, the Warrant, conversion of the Note, exercise of the
Warrant or the consummation of any other transaction contemplated hereby shall
have been obtained and will be effective at the Closing, except for notices
required or permitted to be filed with certain state and federal securities
commissions, which notices will be filed on a timely basis.

(d)           Offering.  Assuming the accuracy of the representations
and warranties of the Purchasers contained in Section 4 hereof, the offer,
issue and sale of the Notes and the Warrant are and will be exempt from the
registration and prospectus delivery requirements of the Securities Act of
1933, as amended (the “Securities Act”),
and have been registered or qualified (or are exempt from registration and
qualification) under the registration, permit or qualification requirements of
all applicable state securities laws.

(e)           SEC
Documents; Financial Statements. 
As of the Closing, the Company shall have filed all reports, schedules,
forms, statements and other documents required to be filed by it with the
Securities and Exchange Commission (“SEC”) pursuant
to the reporting requirements of the Securities Exchange Act of 1934, as
amended (the “1934 Act”) (all of the foregoing
filed prior to the date hereof and all exhibits included therein and financial
statements and schedules thereto and documents incorporated by reference
therein being hereinafter referred to as the “SEC
Documents”).  As of their
respective dates, the SEC Documents complied in all material respects with the
requirements of the 1934 Act and the rules and regulations of the SEC
promulgated thereunder applicable to the SEC Documents, and none of the SEC
Documents, at the time they were filed with the SEC, contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading.  As of their respective dates, the financial
statements of the Company included in the SEC Documents complied as to form in
all material respects with applicable accounting requirements and the published
rules and regulations of the SEC with respect thereto.  Such financial statements have been prepared in
accordance with generally accepted accounting principles, consistently applied,
during the periods involved (except in the case of unaudited interim
statements, to the extent they may exclude footnotes or may be condensed or
summary statements) and fairly present in all material respects the financial
position of the Company as of the dates thereof and the results of its
operations and cash flows for the periods then ended (subject, in the case of
unaudited statements, to normal year-end audit adjustments).  No other information provided by or on behalf
of the Company to the Purchaser which is not included in the SEC Documents
contains any untrue statement of a material fact or

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omits to state any
material fact necessary in order to make the statements therein, in the light
of the circumstance under which they are or were made, not misleading.

4.             Representations and Warranties of the Purchaser.  Purchaser hereby represents and warrants to
the Company that:

(a)           Authorization.  The Purchaser has the full right, power and
authority to enter into and perform the Purchaser’s obligations under this
Agreement, and this Agreement when executed and delivered by the Purchaser will
constitute valid and binding obligations of the Purchaser, enforceable in
accordance with their respective terms, subject to the laws of general
application relating to bankruptcy, insolvency and the relief of debtors, rules
of law governing specific performance, injunctive relief or other equitable
remedies.

(b)           Purchase
Entirely for Own Account.  The
Securities to be acquired by the Purchaser will be acquired for investment for
the Purchaser’s own account, not as a nominee or agent, and not with a view to
the resale or distribution of any part thereof, and the Purchaser has no
present intention of selling, granting any participation in, or otherwise
distributing the same.  The Purchaser is
not an entity formed for the specific purpose of acquiring any of the
Securities.

(c)           Knowledge.  The Purchaser 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
to acquire the Securities.  The Purchaser
has had the opportunity to ask questions of the Company concerning the Company’s
business and any related matter, and has received answer to his or her
satisfaction.

(d)           Restricted
Securities.  The Purchaser
understands that the Securities have not been, and will not be, registered under
the Securities Act, by reason of a specific exemption from the registration
provisions of the Securities Act which depends upon, among other things, the
bona fide nature of the investment intent and the accuracy of the Purchaser’s
representations as expressed herein.  The
Purchaser understands that the Securities are “restricted securities” under
applicable U.S. federal and state securities laws and that, pursuant to
these laws, the Purchaser must hold the Securities indefinitely unless they are
registered with the Securities and Exchange Commission and qualified by state
authorities, or an exemption from such registration and qualification
requirements is available.  The Purchaser
further acknowledges that if an exemption from registration or qualification is
available, it may be conditioned on various requirements including, but not
limited to, the time and manner of sale, the holding period for the Securities,
and on requirements relating to the Company which are outside of the Purchaser’s
control, and which the Company is under no obligation and may not be able to
satisfy.

(e)           Legends.  The Purchaser understands that the
Securities, and any securities issued in respect thereof or exchange therefor,
may bear one or all of the following legends:

(i)            “THIS NOTE, AND THE
SECURITIES ISSUABLE PURSUANT TO A CONVERSION OF THIS NOTE, HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”).  THIS NOTE, AND THE SECURITIES ISSUABLE
PURSUANT TO A CONVERSION OF THIS NOTE, HAVE BEEN ACQUIRED WITHOUT A VIEW TO
DISTRIBUTION AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED
IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THIS NOTE, OR FOR THE
SECURITIES ISSUABLE PURSUANT TO A CONVERSION OF THIS NOTE, AS THE CASE MAY BE, UNDER
THE ACT AND UNDER ANY APPLICABLE STATE SECURITIES LAWS, OR AN OPINION OF
COUNSEL FOR THE HOLDER (CONCURRED IN BY LEGAL COUNSEL FOR THE CORPORATION) THAT
SUCH REGISTRATION IS NOT REQUIRED AS TO SUCH SALE OR OFFER”

(ii)           “THIS WARRANT, AND
THE SECURITIES ISSUABLE PURSUANT TO AN EXERCISE OF THIS WARRANT, HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”).  THIS WARRANT, AND THE SECURITIES ISSUABLE
PURSUANT TO AN EXERCISE OF THIS WARRANT, HAVE BEEN ACQUIRED WITHOUT A VIEW TO DISTRIBUTION
AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THIS WARRANT, OR FOR THE
SECURITIES ISSUABLE PURSUANT TO AN EXERCISE OF THIS WARRANT, AS THE CASE MAY
BE,

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UNDER THE ACT AND UNDER ANY APPLICABLE STATE
SECURITIES LAWS, OR AN OPINION OF COUNSEL FOR THE HOLDER (CONCURRED IN BY LEGAL
COUNSEL FOR THE CORPORATION) THAT SUCH REGISTRATION IS NOT REQUIRED AS TO SUCH
SALE OR OFFER”

 

(iii)          Any legend required
by the Blue Sky laws of any state to the extent such laws are applicable to the
shares represented by the certificate so legended.

(f)            Accredited Investor. 
The Purchaser is an accredited investor as defined in Rule 501(a) of Regulation
D promulgated under the Securities Act because the undersigned is either (i) a
natural person whose individual net worth, or joint net worth with his or her
spouse, exceeds $1,000,000 as of the date of this Agreement, (ii) a natural
person who had an individual income in excess of $200,000 in each of the two
most recent years or joint income with his or her spouse in excess or $300,000
in each of those years and has a reasonable expectation of reaching the same
income level in the current year, or (c) a director or executive officer of the
Company.  Purchaser is in a financial
position to hold the Securities and is able to bear the economic risk and
withstand a complete loss of Purchaser’s investment in the Securities.

5.             Conditions of the Purchaser’s Obligations at Closing.  The obligations of Purchaser to the Company
under this Agreement are subject to the fulfillment, on or before the Closing,
of each of the following conditions, unless otherwise waived:

(a)           Representations
and Warranties.  The representations
and warranties of the Company contained in Section 3 shall be true on and
as of the Closing with the same effect as though such representations and
warranties had been made on and as of the date of the Closing.

(b)           Qualifications.  All authorizations, approvals or permits, if
any, of any governmental authority or regulatory body of the United States or
of any state that are required in connection with the lawful issuance and sale
of the Securities pursuant to this Agreement shall be obtained and effective as
of the Closing.

6.             Conditions of the Company’s Obligations at Closing.  The obligations of the Company to Purchaser
under this Agreement are subject to the fulfillment, on or before the Closing,
of each of the following conditions, unless otherwise waived:

(a)           Representations
and Warranties.  The
representations and warranties of each Purchaser contained in Section 4
shall be true on and as of the Closing with the same effect as though such
representations and warranties had been made on and as of the date of the
Closing.

(b)           Qualifications.  All authorizations, approvals or permits, if
any, of any governmental authority or regulatory body of the United States or
of any state that are required in connection with the lawful issuance and sale of
the Securities pursuant to this Agreement shall be obtained and effective as of
the Closing.

(c)           Payment of
Principal Amount.  Purchaser
shall have paid by check or wire transfer of immediately available funds the
principal amount set forth on the signature page of this Agreement.

7.             Miscellaneous.

(a)           Successors
and Assigns.  The terms and
conditions of this Agreement shall inure to the benefit of and be binding upon
the respective successors and assigns of the parties.  Nothing in this Agreement, express or
implied, is intended to confer upon any party other than the parties hereto or
their respective successors and assigns any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, except as expressly provided
in this Agreement.

(b)           Governing Law.  This Agreement and all acts and transactions
pursuant hereto and the rights and obligations of the parties hereto shall be
governed, construed and interpreted in accordance with the laws of the State of
Oregon, without giving effect to principles of conflicts of law.  The parties agree that the state or

4

 

federal courts located in
the State of Oregon constitute the sole and exclusive venue, and the exclusive
jurisdiction, for disputes arising under or with respect to this Agreement.

(c)           Counterparts.  This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.

(d)           Titles and Subtitles.  The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.

(e)           Notices.  Any notice required or permitted by this
Agreement shall be in writing and shall be deemed sufficient upon receipt, when
delivered personally or by courier, overnight delivery service or confirmed
facsimile, or forty-eight (48) hours after being deposited in the
U.S. mail as certified or registered mail with postage prepaid, if such notice
is addressed to the party to be notified at such party’s address or facsimile
number as set forth below or as subsequently modified by written notice.

(f)            Finder’s Fee.  Except as may otherwise be specifically
agreed to by the parties, each party represents that it neither is nor will be
obligated for any finder’s fee or commission in connection with this
transaction.  Each Purchaser agrees to
indemnify and to hold harmless the Company from any liability for any
commission or compensation in the nature of a finder’s fee (and the costs and
expenses of defending against such liability or asserted liability) for which
each Purchaser or any of its officers, employees, or representatives is
responsible.  The Company agrees to indemnify
and hold harmless each Purchaser from any liability for any commission or
compensation in the nature of a finder’s fee (and the costs and expenses of
defending against such liability or asserted liability) for which the Company
or any of its officers, employees or representatives is responsible.

(g)           Amendments and Waivers.  Any term of this Agreement may be amended or
waived only with the written consent of the Company and the holders of at least
a majority of the outstanding principal amount of the Notes.  Any amendment or waiver effected in
accordance with this Section 7(g) shall be binding upon the Purchasers and
each transferee of the Securities, each future holder of all such Securities,
and the Company.

(h)           Severability.  If one or more provisions of this Agreement
are held to be unenforceable under applicable law or in violation of any law,
exchange rule or regulation to which the Company is subject, the parties agree
to renegotiate such provision in good faith, in order to maintain the economic
position enjoyed by each party as close as possible to that under the provision
rendered unenforceable.  In the event
that the parties cannot reach a mutually agreeable and enforceable replacement
for such provision, then (i) such provision shall be excluded from this
Agreement, (ii) the balance of the Agreement shall be interpreted as if
such provision were so excluded and (iii) the balance of the Agreement
shall be enforceable in accordance with its terms.

(i)            Entire Agreement. 
This Agreement, and the documents referred to herein constitute the
entire agreement between the parties hereto pertaining to the subject matter
hereof and any and all other written or oral agreements existing between the
parties hereto are expressly canceled.

(j)            Most Favored Terms. 
The Note is intended to be one of a series of convertible promissory
notes of like tenor to be issued by the Company prior to March 31, 2008 in an
aggregate principal amount not to exceed $1.5 million (collectively, the “Bridge Notes”).  If
any subsequent purchaser of a Bridge Note receives terms for such note or the
related warrant (including the percentage of warrant coverage) that are
superior to those contained in the Note and the Warrant, then the Company shall
amend the Note or Warrant, as applicable, to provide purchaser with the same
terms.

[Signature Page Follows]

 

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The parties have executed
this Convertible Note Purchase and Warrant Agreement as of the date first
written above.

	
   

  	
  COMPANY:

  
	
   

  
	
   

  	
  BIOJECT MEDICAL TECHNOLOGIES
  INC.

  
	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  (print)

  
	
   

  	
  Title:

  	
   

  
	
   

  	
  Address:

  	
   

  
	
   

  	
   

  
	
   

  	
  Facsimile Number:

  	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  	
  PURCHASER:

  
	
   

  
	
   

  	
   

  
	
   

  	
  (Purchaser)

  
	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  (print)

  
	
   

  	
  Title:

  	
   

  
	
   

  	
  Address:

  	
   

  
	
   

  	
   

  
	
   

  	
  Facsimile Number:

  	
   

  
	
   

  
									

 

 

Exhibits:

 

A — Form of Convertible Promissory Note

C — Form of Warrant

D — Form of Registration Rights Agreement

 

6EXHIBIT 10.4

FORM
OF WARRANT

NEITHER
THIS WARRANT NOR THE SHARES OF COMMON STOCK ISSUABLE UPON ITS EXERCISE HAVE
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR ANY APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD,
OR OTHERWISE TRANSFERRED, PLEDGED, OR HYPOTHECATED UNLESS (I) PURSUANT TO
REGISTRATION UNDER THE SECURITIES ACT OR (II) IN COMPLIANCE WITH AN EXEMPTION
THEREFROM AND ACCOMPANIED, IF REQUESTED BY BIOJECT MEDICAL TECHNOLOGIES INC.,
WITH AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH
TRANSFER IS IN COMPLIANCE WITH AN EXEMPTION THEREFROM.

	
  Warrant No. II-

  	
   

  	
  Number of
  Shares:           

  
	
   

  	
   

  	
  (subject to
  adjustment)

  
	
  Date of
  Issuance: November      , 2007

  	
   

  	
   

  

 

WARRANT

TO PURCHASE COMMON STOCK OF

BIOJECT MEDICAL TECHNOLOGIES INC.

EXPIRING ON NOVEMBER 15, 2011

 

THIS IS TO CERTIFY THAT,
for value received,
                                             ,
a
                                 
(the “Registered Holder”), or its permitted assigns, is entitled to
purchase from BIOJECT MEDICAL TECHNOLOGIES INC., an Oregon corporation (the “Company”),
at the place where the Warrant Office designated pursuant to Section 2.1 is
located, at a purchase price per share of $0.75 (as adjusted pursuant to the
terms of this Warrant, the “Exercise Price”),                  
shares of duly authorized, validly issued, fully paid and nonassessable shares
of Common Stock, no par value per share (“Common Stock”), of the
Company, and is entitled also to exercise the other appurtenant rights, powers
and privileges hereinafter set forth. 
The number of shares of the Common Stock purchasable hereunder and the
Exercise Price are subject to adjustment in accordance with Article III
hereof.  This Warrant shall expire at
5:00 p.m., New York time, on November      ,
2011.

Certain Terms used in
this Warrant are defined in Article IV.

ARTICLE I

EXERCISE OF WARRANT

1.1           Method of
Exercise.  This Warrant may be
exercised by the Registered Holder as a whole or in part from time to time
until November     , 2011, at which time this Warrant
shall expire and be of no further force or effect; provided, however, that the
minimum number of Warrant Shares that may be purchased on a single exercise
shall be the entire number of shares remaining available for exercise
hereunder.  To exercise this Warrant, the
Registered Holder or permitted assignees of all rights of the Registered Holder
shall deliver to the Company, at the Warrant Office designated in Section
2.1(a), a written notice in the form of the Purchase Form attached as Exhibit A
hereto, stating therein the election of the Registered Holder or such permitted
assignees of the Registered Holder to exercise this Warrant in the manner
provided in the Purchase Form, (b) payment in full of the Exercise Price (in
the manner described below) for all Warrant Shares purchased hereunder, and (c)
this Warrant.  Subject to compliance with
Section 3.1(a)(vii), this Warrant shall be deemed to be exercised on the date
of receipt by the Company of the Purchase Form, accompanied by payment for the
Warrant Shares to be purchased and surrender of this Warrant, as aforesaid, and
such date is referred to herein as the “Exercise Date.”  Upon such exercise (subject as aforesaid),
the Company shall issue and deliver to the Registered Holder a certificate for
the full number of the Warrant Shares

 

purchasable by the
Registered Holder hereunder, against the receipt by the Company of the total
Exercise Price payable hereunder for all such Warrant Shares, in cash or by
certified or cashier’s check.  The Person
in whose name the certificate(s) for Common Stock is to be issued shall be
deemed to have become a holder of record of such Common Stock on the Exercise
Date.

1.2           Fractional Shares.  No fractional shares of Common Stock shall be
issued upon exercise of this Warrant. Instead of any fractional shares of
Common Stock that would otherwise be issuable upon exercise of this Warrant,
the Company shall pay a cash adjustment in respect of such fractional interest
equal to the fair market value of such fractional interest as determined in
good faith by the Board of Directors.

1.3           Purchase of
Warrants by the Company.  The Company
shall have the right, except as limited by law, other agreement, or herein, to
purchase or otherwise acquire Warrants at such time, in such manner, and for
such consideration as it may deem appropriate.

1.4           Cancellation of
Warrants.  In the event the Company
shall purchase or otherwise acquire the Warrants, the same shall thereupon be
cancelled by it and retired.

ARTICLE II

WARRANT OFFICE; TRANSFER

2.1           Warrant Office.  The Company shall maintain an office for
certain purposes specified herein (the “Warrant Office”), which office
shall initially be the Company’s office at 20245 S.W. 95th Avenue, Tualatin, Oregon
97062, and may subsequently be such other office of the Company or of any
transfer agent of the Common Stock in the continental United States of which
written notice has previously been given to the Registered Holder.  The Company shall maintain, at the Warrant
Office, a register for the Warrant in which the Company shall record the name
and address of the Registered Holder, as well as the name and address of each
permitted assignee of the rights of the Registered Holder.

2.2           Ownership of
Warrant.  The Company may deem and
treat the Registered Holder as the holder and owner hereof (notwithstanding any
notations of ownership or writing hereon made by anyone other than the Company)
for all purposes and shall not be affected by any notice to the contrary, until
presentation of this Warrant for registration of transfer as provided in this
Article II.

2.3           Transfer of
Warrants.  The Company agrees to
maintain at the Warrant Office books for the registration and transfer of this
Warrant.  Subject to the restrictions on
transfer of Warrants in Section 2.8, the Company, from time to time, shall
register the transfer of this Warrant in such books upon surrender of this
Warrant at the Warrant Office, properly endorsed, together with a written assignment
of this Warrant, substantially in the form of the Assignment attached as Exhibit
B hereto. Upon any such transfer, a new Warrant shall be issued to the
transferee, and the Company shall cancel the surrendered Warrant.  The Registered Holder shall pay all taxes and
all other expenses and charges payable in connection with the transfer of
Warrants pursuant to this Section 2.3.

2.4           Acknowledgement
of Rights.  The Company will, at the
time of exercise of this Warrant in accordance with the terms hereof, upon
request of the Registered Holder, acknowledge in writing its continuing
obligation to afford to such holder any rights to which such holder shall
continue to be entitled after such exercise in accordance with the provisions
of this Warrant, provided that if the holder of this Warrant shall fail to make
any such request, such failure shall not affect the continuing obligation of
the Company to afford to such holder any such rights.

2.5           No Rights as
Shareholder Until Exercise.  This
Warrant does not entitle the Registered Holder to any voting rights or other
rights as a shareholder of the Company prior to the exercise hereof.  Upon the surrender of this Warrant and the
payment of the aggregate Exercise Price, the Warrant Shares so purchased shall
be and be deemed to be issued to the Registered Holder as the record owner of
such shares as of the close of business on the Exercise Date.

 

2

 

2.6           Expenses of
Delivery of Warrants.  Except as
provided in Section 2.3 above, the Company shall pay all reasonable expenses,
taxes (other than transfer taxes), and other charges payable in connection with
the preparation, issuance and delivery of Warrants and related Warrant Shares
hereunder.

2.7           Compliance with
Securities Laws.  The Registered
Holder (and its transferees and assigns), by acceptance of this Warrant,
covenants and agrees that such Registered Holder is acquiring the Warrants
evidenced hereby, and, upon exercise hereof, the Warrant Shares, for its own
account as an investment and not with a view to distribution thereof.  Neither this Warrant nor the Warrant Shares
issuable hereunder have been registered under the Securities Act or any state
securities laws and no transfer of this Warrant or any Warrant Shares shall be
permitted unless the Company has received notice of such transfer in the form
of the assignment attached hereto as Exhibit B, accompanied, if
requested by the Company, by an opinion of counsel reasonably satisfactory to
the Company that an exemption from registration of such Warrant or Warrant
Shares under the Securities Act is available for such transfer, except that no
such opinion shall be required with respect to the Warrant Shares after the
registration for resale of the Warrant Shares has become effective if the
Warrant Shares are sold pursuant to the registration statement.  Upon any exercise of the Warrants prior to
effective registration for resale or except as in accordance with Rule 144
under the Securities Act, certificates representing the Warrant Shares shall
bear a restrictive legend substantially identical to that set forth as follows:

“The securities
represented by this certificate have not been registered under the Securities
Act of 1933, as amended, or the securities laws of any state (collectively, the
“Acts”).  Neither the shares nor any
interest therein may be offered, sold, transferred, pledged, or otherwise
disposed of in the absence of an effective registration statement with respect
to the shares under all of the applicable Acts, or an opinion of counsel
satisfactory to Bioject Medical Technologies Inc. to the effect that such
registrations are not required.”

(c)           Any purported transfer of the Warrant
or Warrant Shares not in compliance with the provisions of this section shall
be null and void.  Stop transfer
instructions have been or will be imposed with respect to the Warrant Shares so
as to restrict resale or other transfer thereof, subject to this Section 2.7.

ARTICLE III

ANTI-DILUTION PROVISIONS

3.1           Adjustment of
Exercise Price and Number of Warrant Shares.  The Exercise Price shall be subject to
adjustment from time to time as hereinafter provided in this Article III.  Upon each adjustment of the Exercise Price,
except pursuant to Sections 3.1(a)(iii) and (iv), the Registered Holder shall
thereafter be entitled to purchase, at the Exercise Price resulting from such
adjustment, the number of shares of the Common Stock obtained by multiplying
the Exercise Price in effect immediately prior to such adjustment by the number
of shares of the Common Stock purchasable pursuant hereto immediately prior to
such adjustment and dividing the product thereof by the Exercise Price
resulting from such adjustment.

(a)           Exercise Price
Adjustments.  The Exercise Price
shall be subject to adjustment from time to time as follows:

(i)            Adjustment for
Stock Splits and Combinations. If the Company shall, at any time or from
time to time after the date hereof (the “Original Issue Date”) while
this Warrant remains outstanding, effect a subdivision of the outstanding
Common Stock, the Exercise Price in effect immediately before such subdivision
shall be proportionately decreased. 
Conversely, if the Company shall at any time or from time to time after
the Original Issue Date combine the outstanding shares of Common Stock into a
smaller number of shares, the Exercise Price in effect immediately before such
combination shall be proportionately increased. 
Any adjustment under this Section 3.1(a)(i) shall become effective at
the close of business on the date the subdivision or combination becomes
effective.

(ii)           Adjustment
for Common Stock Dividends and Distributions.  If the Company, at any time or from time to
time after the Original Issue Date while this Warrant remains outstanding
makes, or fixes a

 

3

 

record date for
the determination of holders of Common Stock entitled to receive, a dividend or
other distribution payable in additional shares of Common Stock, in each such
event the Exercise Price that is then in effect shall be decreased as of the
time of such issuance or, in the event such record date is fixed, as of the
close of business on such record date, by multiplying the Exercise Price then
in effect by a fraction (i) the numerator of which is the total number of
shares of Common Stock issued and outstanding immediately prior to the time of
such issuance or the close of business on such record date, and (ii) the
denominator of which is the total number of shares of Common Stock issued and
outstanding immediately prior to the time of such issuance or the close of
business on such record date plus the number of shares of Common Stock issuable
in payment of such dividend or distribution; provided, however,
that if such record date is fixed and such dividend is not fully paid or if
such distribution is not fully made on the date fixed therefor, the Exercise
Price shall be recomputed accordingly as of the close of business on such
record date, and thereafter the Exercise Price shall be adjusted pursuant to this
Section 3.1(a)(ii) to reflect the actual payment of such dividend or
distribution.

(iii)          Adjustment for
Reclassification, Exchange, and Substitution.  If at any time or from time to time after the
Original Issue Date while this Warrant remains outstanding, the Common Stock is
changed into the same or a different number of shares of any class or classes
of stock, whether by recapitalization, reclassification, or otherwise (other
than an Acquisition, Asset Transfer, subdivision or combination of shares, stock
dividend, reorganization, merger, consolidation, or sale of assets provided for
elsewhere in this Section 3.1(a)), in any such event the Registered Holder
shall have the right thereafter to convert such stock into the kind and amount
of stock and other securities and property receivable upon such
recapitalization, reclassification or other change by holders of the maximum
number of shares of Common Stock into which such shares of Common Stock could
have been converted immediately prior to such recapitalization,
reclassification or change, all subject to further adjustment as provided
herein or with respect to such other securities or property by the terms
thereof.

(iv)          Reorganizations,
Mergers, Consolidations, or Sales of Assets.  If at any time or from time to time after the
Original Issue Date while this Warrant remains outstanding, there is a capital
reorganization of the Company, an Acquisition, an Asset Transfer (other than a
recapitalization, or subdivision, combination, reclassification, exchange, or
substitution of shares provided for elsewhere in this Section 3.1(a)), as a
part of such capital reorganization, Acquisition, or Asset Transfer, provision
shall be made so that the Registered Holder shall thereafter be entitled to
receive upon exercise hereof the number of shares of stock or other securities
or property to which a holder of the number of shares of Common Stock
deliverable upon exercise immediately prior to such event would have been
entitled as a result of such capital reorganization, subject to adjustment in
respect of such stock or securities by the terms thereof.  In any such case, appropriate adjustment
shall be made in the application of the provisions of this Section 3.1(a) with
respect to the rights of the Registered Holder after the capital
reorganization, Acquisition, or Asset Transfer to the end that the provisions
of this Section 3.1(a) (including adjustment of the Exercise Price then in
effect and the number of shares issuable upon exercise) shall be applicable
after that event and be as nearly equivalent as practicable.

(v)           Distributions of
Securities.  In case of any
distribution of any security (including rights or warrants to subscribe for any
such secur­ities) of the Company (except Common Stock), evidences of its
indebtedness, cash, or other assets to all of the holders of its Common Stock,
then in each such case the Exercise Price in effect thereafter shall be
determined by multiplying the Exercise Price in effect immediately prior
thereto by a fraction, the numerator of which shall be the total number of
outstanding shares of Common Stock multiplied by the Current Market Price on
the record date mentioned below, less the fair market value (as determined in
good faith by the Board of Directors) of the securities, evidences of
indebtedness, cash, or other assets distributed by the Company, and the
denominator of which shall be the total number of outstanding shares of Common
Stock multiplied by the Current Market Price; such adjustment shall become
effective as of the record date for the determination of shareholders entitled
to receive such distribution. The subdivision or combination of shares of
Common Stock issuable upon exercise of this Warrant at any time outstanding
into a greater or lesser number of shares of Common Stock shall not be deemed
to be a reclassifica­tion of the Common Stock of the Company of this clause
(v).

(vi)          Rounding of
Calculations; Minimum Adjustment. 
All calculations under this Section 3.1(a) and under Section 3.1(b)
shall be made to the nearest cent.  Any
provision of this Section 3.1 to the contrary notwithstanding, no adjustment in
the Exercise Price shall be made if the amount of such adjustment would be less
than one percent, but any such amount shall be carried forward and an
adjustment with respect thereto shall

 

4

 

be made at the
time of and together with any subsequent adjustment which, together with such
amount and any other amount or amounts so carried forward, shall aggregate one
percent or more.

(vii)         Timing of
Issuance of Additional Common Stock Upon Certain Adjustments.  In any case in which the provisions of this
Section 3.1(a) shall require that an adjustment shall become effective
immediately after a record date for an event, the Company may defer until the
occurrence of such event issuing to the Registered Holder after such record
date and before the occurrence of such event the additional shares of Common
Stock or other property issuable or deliverable upon exercise by reason of the
adjustment required by such event over and above the shares of Common Stock or
other property issuable or deliverable upon such exercise before giving effect
to such adjustment; provided, however, that the Company upon
request shall deliver to such Registered Holder a due bill or other appropriate
instrument evidencing such Registered Holder’s right to receive such additional
shares or other property, and such cash, upon the occurrence of the event
requiring such adjustment.

(viii)        Voluntary
Adjustment by the Company.  The
Company may at any time during the term of this Warrant, reduce the then
current Exercise Price to any amount and for any period of time deemed
appropriate by the Board of Directors, in its sole discretion.

(b)           Statement
Regarding Adjustments.  Whenever the
Exercise Price shall be adjusted as provided in Section 3.1(a), and upon each
change in the number of shares of the Common Stock issuable upon exercise of
this Warrant, the Company shall forthwith file, at the office of any transfer
agent for this Warrant and at the principal office of the Company, a statement
showing in detail the facts requiring such adjustment and the Exercise Price
and new number of shares issuable that shall be in effect after such
adjustment, and the Company shall also cause a copy of such statement to be
given to the Registered Holder.  Each
such statement shall be signed by the Company’s chief financial or accounting
officer.  Where appropriate, such copy
may be given in advance and may be included as part of a notice required to be
mailed under the provisions of Section 3.1(c).

(c)           Notice to Holders.  In the event the Company shall propose to
take any action of the type described in clause (iii) or (iv) of Section
3.1(a), the Company shall give notice to the Registered Holder, in the manner
set forth in Section 6.6, which notice shall specify the record date, if any,
with respect to any such action and the approximate date on which such action
is to take place.  Such notice shall also
set forth such facts with respect thereto as shall be reasonably necessary to
indicate the effect of such action (to the extent such effect may be known at
the date of such notice) on the Exercise Price and the number, kind or class of
shares or other securities or property which shall be deliverable upon exercise
of this Warrant.  In the case of any
action which would require the fixing of a record date, such notice shall be
given at least 10 days prior to the date so fixed, and in case of all other action,
such notice shall be given at least 15 days prior to the taking of such
proposed action.  Failure to give such
notice, or any defect therein, shall not affect the legality or validity of any
such action.

3.2           Costs.  The Registered Holder shall pay all
documentary, stamp, transfer or other transactional taxes attributable to the
issuance or delivery of the Warrant Shares upon exercise of this Warrant.  Additionally, the Company shall not be
required to pay any taxes which may be payable in respect of any transfer
involved in the issuance or delivery of any certificate for such Warrant
Shares.  The Registered Holder shall
reimburse the Company for any such taxes assessed against the Company.

3.3           Reservations of
Shares.  The Company shall reserve at
all times so long as this Warrant remains outstanding, free from preemptive
rights, out of its authorized but unissued shares of Common Stock, solely for
the purpose of effecting the exercise of this Warrant, sufficient shares of
Common Stock to provide for the exercise hereof.

3.4           Valid Issuance.  All shares of Common Stock which may be
issued upon exercise of this Warrant will upon issuance by the Company be duly
and validly issued, fully paid and nonassessable and free from all taxes, liens
and charges with respect to the issuance thereof attributable to any act or
omission by the Company, and the Company shall take no action which will cause
a contrary result (including without limitation, any action which would cause
the Exercise Price to be less than the par value, if any, of the Common Stock).

 

5

ARTICLE IV

TERMS DEFINED

As used in this Warrant,
unless the context otherwise requires, the following terms have the respective
meanings set forth below or in the Section indicated:

Acquisition means the acquisition of the Company by
another person or entity or group of affiliated persons or entities by means of
any transaction or series of related transactions (including, without
limitation, any reorganization, merger, or consolidation but excluding any merger
effected exclusively for the purpose of changing the domicile of the Company)
that results in the transfer of more than 50% of the outstanding voting power
of the Company.

Asset Transfer means the sale, lease, or other transfer
of all or substantially all of the assets of the Corporation

Board of Directors means the Board of Directors of the
Company.

Common Stock means the Company’s authorized Common
Stock, no par value per share.

Company means Bioject Medical Technologies Inc.,
an Oregon corporation, and any other corporation assuming or required to assume
the obligations undertaken in connection with this Warrant.

Current Market Price means the arithmetic average of the
closing price per share of the Common Stock on the Principal Market for the
20 consecutive Trading Days ending on and including the Trading Day
immediately prior to the date in question. If the Current Market Price cannot
be determined under the foregoing method, the Current Market Price shall mean
the fair value per share of Common Stock on such date as determined by the
Board of Directors in good faith, irrespective of any accounting treatment.

Exchange Act means the Securities and Exchange Act of
1934, as amended.

Exercise Date is defined in Section 1.1.

Exercise Price is defined in the Preamble.

Majority Holders means at any time Registered Holders of
Warrant Shares which shares constitute a majority of the outstanding Warrant
Shares.

Original Issue Date is defined in Section 3.1(a)(i).

Outstanding means when used with reference to Common
Stock at any date, all issued shares of Common Stock (including, but without
duplication, shares deemed issued pursuant to Article III) at such date.

Person means any individual, corporation,
partnership, trust, organization, association or other entity.

Principal Market means whichever of (a) the national
securities exchange, (b) the Nasdaq Capital Market, or (c) such other
securities market on which the Common Stock is listed for trading which at such
time constitutes the principal securities market for the Common Stock.

Registered Holder is defined in the Preamble.

Securities Act means the Securities Act of 1933 and the
rules and regulations promulgated thereunder, all as the same shall be in
effect at the time.

 

6

 

Trading Day means a day on whichever of (a) the
national securities exchange, (b) the Nasdaq Capital Market, or (c) such other
securities markets, in any case which at the time constitutes the Principal
Market for the Common Stock, is open for general trading of securities.

Warrant means this Warrant and any successor or
replacement Warrant delivered in accordance with Section 2.3 or 6.8.

Warrant Office is defined in Section 2.1.

Warrant Shares means the shares of Common Stock
purchased or purchasable by the Registered Holder, or the permitted assignees
of such Registered Holder, upon exercise of this Warrant pursuant to Article I
hereof.

ARTICLE V

COVENANT OF THE COMPANY

The Company covenants and
agrees that this Warrant shall be binding upon any corporation succeeding to
the Company by merger, consolidation, or acquisition of all or substantially
all of the Company’s assets.

ARTICLE VI

MISCELLANEOUS

6.1           Entire Agreement.  This Warrant and the Registration Rights
Agreement contain the entire agreement between the Registered Holder and the
Company with respect to the Warrant Shares that it can purchase upon exercise
hereof and the related transactions and supersedes all prior arrangements or
understanding with respect thereto.

6.2           Governing Law.  This Warrant shall be governed by and
construed in accordance with the internal laws of the State of Oregon, without
regard to its conflict of law provisions.

6.3           Waiver and
Amendment.  Any term or provision of
this Warrant may be waived at any time by the party which is entitled to the
benefits thereof, and any term or provision of this Warrant may be amended or
supplemented at any time by written consent of the parties (it being agreed
that an amendment to or waiver under any of the provisions of Article III of
this Warrant shall not be considered an amendment of the number of Warrant
Shares or the Exercise Price).  No waiver by any party of any default, misrepresentation, or
breach of warranty or covenant hereunder, whether intentional or not, shall be
deemed to extend to any prior or subsequent default, misrepresentation, or
breach of warranty or covenant hereunder or affect in any way any rights
arising because of any prior or subsequent such occurrence.

6.4           Illegality.  In the event that any one or more of the
provisions contained in this Warrant shall be determined to be invalid, illegal
or unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in any other respect and the remaining
provisions of this Warrant shall not, at the election of the party for whom the
benefit of the provision exists, be in any way impaired.

6.5           Copy of Warrant.  A copy of this Warrant shall be filed among
the records of the Company.

6.6           Notice.  Any notice or other document required or
permitted to be given or delivered to the Registered Holder shall be delivered
at, or sent by certified or registered mail to such Registered Holder at, the
last address shown on the books of the Company maintained at the Warrant Office
for the registration of this Warrant or at any more recent address of which the
Registered Holder shall have notified the Company in writing.  Any notice or other document required or
permitted to be given or delivered to the Company, other than such notice or
documents required to be delivered to the Warrant Office, shall be delivered
at, or sent by certified or registered mail to, the office of the Company at 20245
S.W. 95th Avenue, Tualatin, Oregon 97062 or any other address within the
continental United States of America as shall have been designated in writing
by the Company delivered to the Registered Holder.

 

7

 

6.7           Limitation of
Liability; Not Stockholders.  Subject
to the provisions of Article III, until the exercise of this Warrant, the
Registered Holder shall not have or exercise any rights by virtue hereof as a
stockholder of the Company, including, without limitation, the right to vote,
to receive dividends and other distributions, or to receive notice of, or
attend meetings of stockholders or any other proceedings of the Company.  Until the exercise of this Warrant, no
provision hereof, and no mere enumeration herein of the rights or privileges of
the Registered Holder, shall give rise to any liability of such Registered
Holder for the purchase price of any shares of Common Stock or as a stockholder
of the Company, whether such liability is asserted by the Company or by
creditors of the Company.

6.8           Exchange, Loss,
Destruction, etc. of Warrant.  Upon receipt
of evidence satisfactory to the Company (an affidavit of the Registered Holder
shall be satisfactory evidence) of the loss, theft, mutilation or destruction
of this Warrant, and, in the case of any such loss, theft or destruction, upon
delivery of a bond of indemnity in such form and amount as shall be reasonably
satisfactory to the Company, or, in the event of such mutilation upon surrender
and cancellation of this Warrant, the Company will make and deliver a new
Warrant of like tenor, in lieu of such lost, stolen, destroyed or mutilated
Warrant; provided, however, that the original Registered Holder
of this Warrant shall not be required to provide any such bond of indemnity and
may in lieu thereof provide his agreement of indemnity.  Any Warrant issued under the provisions of
this Section 6.8 in lieu of any Warrant alleged to be lost, destroyed or
stolen, or in lieu of any mutilated Warrant, shall constitute an original
contractual obligation on the part of the Company.  This Warrant shall be promptly canceled by
the Company upon the surrender hereof in connection with any exchange or
replacement.  The Registered Holder of
this Warrant shall pay all taxes (including securities transfer taxes) and all
other expenses and charges payable in connection with the preparation,
execution and delivery of replacement Warrant(s) pursuant to this Section 6.8.

6.9           Headings.  The Article and Section and other headings
herein are for convenience only and are not a part of this Warrant and shall
not affect the interpretation thereof.

6.10         Successors and
Assigns.  Subject to applicable
securities laws, this Warrant and the rights and obligations evidenced hereby
shall inure to the benefit of and be binding upon the successors of the Company
and the successors and permitted assigns of Registered Holder.  The provisions of this Warrant are intended
to be for the benefit of all Registered Holders from time to time of this
Warrant and shall be enforceable by any such Registered Holder or holder of
Warrant Shares.

 

IN WITNESS WHEREOF, the
Company has caused this Warrant to be signed in its name.

Dated:  November 
    , 2007

 

	
   

  	
  BIOJECT MEDICAL
  TECHNOLOGIES INC.

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					

 

8

 

Exhibit A

 

PURCHASE FORM

 

	
  To:

  	
   

  	
  Bioject Medical
  Technologies Inc.

  	
   

  	
  Dated:                    ,
  20

  
	
   

  	
   

  	
  20245 S.W. 95th Avenue

  	
   

  	
   

  
	
   

  	
   

  	
  Tualatin, Oregon 97062

  	
   

  	
   

  

 

The undersigned, pursuant
to the provisions set forth in the attached Warrant (No.            ),
hereby irrevocably elects to purchase            
shares of the Common Stock covered by such Warrant.

The undersigned herewith
makes payment of the full exercise price for such shares at the price per share
provided for in such Warrant, which is $         per
share in lawful money of the United States.

	
   

  	
   

  	
   

  
	
  [

  	
   

  	
  ]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  

 

 

9

 

Exhibit B

 

ASSIGNMENT

 

For value received,                                             , hereby sells, assigns and transfers unto                                                    
the within Warrant, together with all right, title and interest therein and
does hereby irrevocably constitute and appoint attorney, to transfer said
Warrant on the books of the Company, with full power of substitution.

 

 

	
   

  	
   

  
	
   

  
	
  Dated:                              ,
  20         

  
	
   

  

 

10

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