Document:

exv4w3

Exhibit 4.3

THE SECURITIES REPRESENTED BY THIS WARRANT HAVE BEEN ACQUIRED FOR INVESTMENT, HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY STATE OR FEDERAL SECURITIES
LAWS AND MAY NOT BE SOLD, TRANSFERRED, OR ASSIGNED EXCEPT: (1) PURSUANT TO THE EFFECTIVE
REGISTRATION THEREOF UNDER SUCH ACT; OR (2) IF, IN THE OPINION OF COUNSEL FOR THE REGISTERED OWNER
HEREOF, WHICH OPINION IS REASONABLY SATISFACTORY TO THE COMPANY, THE PROPOSED SALE, TRANSFER OR
ASSIGNMENT MAY BE EFFECTED WITHOUT SUCH REGISTRATION AND WILL NOT BE IN VIOLATION OF APPLICABLE
STATE AND/OR FEDERAL SECURITIES LAWS

NUPATHE INC.

WARRANT TO PURCHASE SHARES

OF PREFERRED STOCK

Warrant No.                     
Issue Date:                      ___, 20___

     THIS CERTIFIES THAT, for value received,                      (“Holder”), is entitled to subscribe for
and purchase up to                      shares of                                          (as applicable, the “Shares”) of
NuPathe Inc., a Delaware corporation (the “Company”), at the Warrant Price (as defined
below), subject to the provisions and upon the terms and conditions set forth herein. As used
herein, “Note” shall mean that certain Secured Subordinated Convertible Promissory Note, dated as
of April ___, 2010, made by the Company in favor of the Holder. This Warrant is one of a series
of Warrants to purchase Shares of Preferred Stock issued by the Company pursuant to that certain
Subordinated Convertible Note and Warrant Purchase Agreement, dated as of April ___, 2010, by and
among the Company, the Holder and the other parties named therein (as the same may be amended from
time to time, the “Purchase Agreement”). Terms used, but not otherwise defined herein, shall have
the meanings ascribed to such terms in the Purchase Agreement.

     1. Warrant Price. The per share exercise price (the “Warrant Price”)
initially shall be equal to $                      per share as set forth in the Note. The Warrant Price shall
be subject to adjustment as provided in Section 6 below.

     2. Conditions to Exercise. The purchase right represented by this Warrant
may be exercised at any time, or from time to time, in whole or in part, during the term commencing
on the date hereof and ending on the earlier to occur of (i) the seventh (7th)
anniversary of such date and (ii) the consummation of an IPO (as defined in the Note).

     3. Method of Exercise; Payment; Issuance of Shares.

          (a) Cash Exercise. Subject to Section 2 hereof, the purchase right
represented by this Warrant may be exercised by the Holder hereof, in whole or in part, by the
surrender of this Warrant (with a duly executed Notice of Exercise in the form attached hereto) at
the principal office of the Company (as set forth in Section 11 below) and by payment to the
Company, by cashier’s or other check acceptable to the Company representing immediately available
funds, of an amount equal to the then applicable Warrant Price multiplied by the number of Shares
then being purchased. In the event of any exercise of the rights represented by this Warrant,
certificates for the Shares so purchased shall be in the name of, and delivered to, the Holder
hereof, or as such Holder may direct (subject to the terms of transfer contained herein and upon
payment by such Holder hereof of any applicable transfer taxes).

 

 

          (b) Net Issue Exercise. If the Fair Market Value of one Share is greater
than the Warrant Price (at the date of such calculation), then in lieu of exercising this Warrant
pursuant to Section 3(a), the Holder may elect to receive Shares equal to the value of this Warrant
(or of any portion thereof remaining unexercised) by surrender of this Warrant at the principal
office of the Company together with notice of such election, in which event the Company shall issue
to Holder the number of Shares computed using the following formula:

	 	 	 	 	 	 	 

	 

	 	X =
	 	Y (A-B)	 	 
	 

	 	 	 	 

	 	 
	 

	 	 	 	A
 

	 	 

	 	 	 

	Where X =

	 	the number of Shares to be issued to Holder.
	 
	 	 
	Y =

	 	the number of Shares purchasable under this Warrant (at the date of such calculation).
	 
	 	 
	A =

	 	the Fair Market Value of one Share issuable under this Warrant (at the date
of such calculation).
	 
	 	 
	B =

	 	Warrant Price (as adjusted to the date of such calculation).

          (c) Fair Market Value. For purposes of this Section 3, “Fair Market Value”
of one Share issuable under this Warrant shall mean: the fair market value of such security
determined by a third party appraiser designated by a majority of the members of the Company’s
Board of Directors (the “Board”) who are not affiliated with any Purchaser (the “Independent
Directors”) and reasonably acceptable to the Requisite Holders (the “Appraiser”); provided,
however, that if the parties fail to agree on an Appraiser, then the Independent Directors, on the
one hand, and the Majority Holders (as defined in the Note), on the other hand, shall each select
its own independent appraiser, which appraisers shall then select an independent appraiser to
finally determine the Fair Market Value. If either the Independent Directors, on the one hand, or
the Majority Holders, on the other hand, fails to select an independent appraiser, then the
successfully selected independent appraiser shall finally determine the Fair Market Value. The
Company shall bear all fees and expenses in connection with the selection and engagement of the
Appraiser

     4. Legends. Each certificate representing the Shares shall be endorsed
with the following legend:

“THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933 (THE “ACT”), AND MAY NOT BE OFFERED, SOLD
OR OTHERWISE TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED UNLESS
AND UNTIL REGISTERED UNDER THE ACT OR UNLESS THE COMPANY HAS
RECEIVED AN OPINION OF COUNSEL OR OTHER EVIDENCE SATISFACTORY TO THE
COMPANY AND ITS COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.”

     The Company need not enter into its stock register a transfer of Shares unless the conditions
specified in the foregoing legend are satisfied. The Company may also instruct its transfer agent
not to register the transfer of any of the Shares unless the conditions specified in the foregoing
legend are satisfied.

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     5. Stock Fully Paid; Reservation of Shares. All Shares that may be issued
upon the exercise of the rights represented by this Warrant, will, upon issuance, be fully paid and
nonassessable, and free from all taxes, liens, and charges with respect to the issue thereof.
During the period within which the rights represented by this Warrant may be exercised, the Company
will at all times have authorized, and reserved for issuance upon exercise of the purchase rights
evidenced by this Warrant, a sufficient number of Shares to provide for the exercise of the rights
represented by this Warrant.

     6. Adjustment for Certain Events. In the event of changes in the
outstanding Shares (or the Company’s Common Stock in the event the Shares have been converted into
Common Stock) by reason of stock dividends, split-ups, recapitalizations, reclassifications,
mergers, consolidations, combinations or exchanges of shares, separations, reorganizations,
liquidations, or the like, the number and class of shares available for purchase pursuant to this
Warrant in the aggregate and the Warrant Price shall be correspondingly adjusted, as appropriate,
by the Board. The adjustment shall be such as will give the Holder of this Warrant upon exercise
for the same aggregate Warrant Price the total number, class and kind of shares as he would have
owned had the Warrant been exercised prior to the event and had he continued to hold such shares
until after the event requiring adjustment.

     7. Notice of Adjustments. Whenever any Warrant Price shall be adjusted
pursuant to Section 6 hereof, the Company shall prepare a certificate signed by the Company’s chief
executive officer setting forth, in reasonable detail, the event requiring the adjustment, the
amount of the adjustment, the method by which such adjustment was calculated, and the Warrant Price
and number of Shares issuable upon exercise of the Warrant after giving effect to such adjustment,
and shall cause copies of such certificate to be mailed (by certified or registered mail, return
receipt required, postage prepaid) within thirty (30) days of such adjustment to the Holder of this
Warrant as set forth in Section 11 hereof.

     8. No Fractional Shares. No fractional Shares will be issued in connection
with any exercise hereunder, but in lieu of such fractional share the Company shall make a cash
payment therefore upon the basis of the Warrant Price then in effect.

     9. Charges, Taxes and Expenses. Issuance of certificates for Shares upon
the exercise of this Warrant shall be made without charge to the Holder for any United States or
state of the United States documentary stamp tax or other incidental expense within respect to the
issuance of such certificate, all of which taxes and expenses shall be paid by the Company, and
such certificates shall be issued in the name of the Holder.

     10. Miscellaneous.

          (a) Successors. This Warrant shall be binding upon any successors or
assigns of the Company.

          (b) Assignment. The Holder may assign or otherwise transfer this Warrant to
any affiliate of such Holder that is an “accredited investor” without the prior written consent of
the Company; provided that (i) any such transferee agrees to be subject to the terms of the
Amended and Restated Investor Rights Agreement, dated as of July 8, 2008, by and among the Company
and the other parties named therein (the “Investor Rights Agreement”) to the same extent as if such
transferee was an original Holder (as defined in the Investor Rights Agreement) with respect to any
Registrable Securities (as defined in the Investor Rights Agreement) that may be issued to such
transferee and (ii) any transfer of this Warrant will be effected only by surrender of this
Warrant to the Company and reissuance of a new warrant to the transferee. Any other assignment or
transfer of this Warrant by the Holder shall require the prior written consent of the Company.

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          (c) Amendment. Except as otherwise provided in this Warrant, no
modification or amendment hereof shall be effective unless (i) made in a writing signed by
appropriate officers of the Company, (ii) such amendment or modification is approved by the
Majority Holders (as defined in the Note), and (iii) such amendment or modification is made to all
of the Warrants issued pursuant to the Purchase Agreement.

          (d) Governing Law. This Warrant shall be governed by, and construed and
enforced in accordance with, the substantive laws of the State of Delaware, without regard to the
conflicts of laws principles of any jurisdiction.

          (e) Headings. The headings used in this Warrant are used for convenience
only and are not to be considered in construing or interpreting this Warrant.

          (f) Saturdays, Sundays, Holidays. If the last or appointed day for the
taking of any action or the expiration of any right required or granted herein shall be a Saturday
or a Sunday or shall be a legal holiday in the State of Delaware, then such action may be taken or
such right may be exercised on the next succeeding day not a legal holiday

          (g) No Rights as Stockholder. Prior to the exercise of this Warrant, the
Holder shall not be entitled to any rights of a stockholder of the Company with respect to shares
for which this Warrant shall be exercisable, including, without limitation, the right to vote, to
receive dividends or other distributions (other than as expressly provided for in this Warrant) or
to exercise any preemptive rights, and shall not be entitled to receive any notice of any
proceedings of the Company

          (h) Compliance with Securities Laws. The Holder, by acceptance hereof,
acknowledges that this Warrant and the Shares to be issued upon exercise hereof are being acquired
solely for the Holder’s own account and not as a nominee for any other party, and for investment,
and that the Holder will not offer, sell or otherwise dispose of this Warrant or any Shares to be
issued upon exercise hereof except under circumstances that will not result in a violation of
applicable federal and state securities laws.

     11. Notices. Any notice required or permitted hereunder shall be in writing
and shall be mailed by overnight courier, registered or certified mail, return receipt required,
and postage pre-paid, or otherwise delivered by hand or by messenger, addressed as set forth below,
or at such other address as the Company or the Holder hereof shall have furnished to the other
party.

	 	 	 	 	 

	 

	 	If to the Company:	 	 
	 

	 	 	 	NuPathe Inc.
	 

	 	 	 	227 Washington Street, Suite 200
	 

	 	 	 	Conshohocken, PA 19428
	 

	 	 	 	Attention:   Chief Executive Officer
	 

	 	 	 	Telephone:  (484) 567-0130
	 

	 	 	 	Facsimile:    (484) 567-01362
	 
	 	 	 	 
	 

	 	 	 	with a copy to:
	 
	 	 	 	 
	 

	 	 	 	Morgan Lewis & Bockius LLP
	 

	 	 	 	1701 Market Street
	 

	 	 	 	Philadelphia, PA 19103
	 

	 	 	 	Attention: Michael N. Peterson
	 

	 	 	 	Telephone: (215) 963-5025

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	 	 	 	Facsimile: (215) 963-5001
	 

	 	 	 	Email: mpeterson@morganlewis.com

and, if to the Holder, at the most recent address provided to the Company by the Holder for
such purpose; or, in each case, to the most recent address, specified by written notice, given to
the sender pursuant to this paragraph.

[Signature Page Follows]

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     IN WITNESS WHEREOF, NuPathe Inc. has caused this Warrant to Purchase Shares of Preferred
Stock to be executed by its officers thereunto duly authorized.

Dated as
of this ___ day of                                         , 20___.

	 	 	 	 	 
	 	NuPathe Inc.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

[Signature page to NuPathe Inc. Warrant to Purchase Shares of Preferred Stock]

 

 

NOTICE OF EXERCISE

	 	 	 

	TO:

	 	NuPathe Inc.
	 

	 	227 Washington Street, Suite 200
	 
	 	Conshohocken, PA 19428
	 
	 	Attention: Chief Executive Officer

     The undersigned,                                          (“Holder”) elects to acquire shares of                                                             
of NuPathe Inc. (the “Company”), pursuant to the terms of the Warrant to Purchase Shares of
Preferred Stock dated                                          (the “Warrant”).

     The Holder exercises its rights under the Warrant as set forth below:

     1. The
Holder elects to purchase                      shares of the Company’s
                                                             and tenders herewith a check in the amount of $                      as payment of the
purchase price.

     2. The Holder surrenders the Warrant with this Notice of Exercise.

     3. The Holder represents that it is acquiring the aforesaid shares of
                                         for investment and not with a view to or for resale in connection with,
distribution and that the Holder has no present intention of distributing or reselling the shares.

     Please issue a certificate representing the shares of                                          in the name of the
Holder or in such other name as is specified below:

Name:                                                                                       

Address:                                                                                 

Taxpayer I.D.                                                                          

By:

Name:                                                                                       

Title:                                                                                         

Date:
                                                                                        

 

 

THE WARRANT AMENDED HEREBY WAS ORIGINALLY ISSUED ON AUGUST 20, 2009, AND NEITHER THE WARRANT
NOR THIS WARRANT AMENDMENT HAS BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
APPLICABLE STATE SECURITIES LAW, AND MAY NOT BE SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE
DISPOSED OF EXCEPT IN COMPLIANCE WITH APPLICABLE FEDERAL AND STATE SECURITIES LAWS AND THE OTHER
RESTRICTIONS ON TRANSFER SET FORTH IN THE WARRANT.

AMENDMENT NO. 1 TO WARRANT TO PURCHASE SHARES OF PREFERRED STOCK

          This Amendment No. 1 to Warrant to Purchase Shares of Preferred Stock (“Warrant Amendment”) is
made effective as of the ___ day of May, 2010, by NuPathe Inc., a Delaware corporation (the
“Company”), and shall be binding upon the Holder. Capitalized terms not otherwise defined shall
have the meaning given to them in the Warrant to Purchase Shares of Preferred Stock, dated August
20, 2009 (the “Warrant”), in favor of [NAME OF WARRANT HOLDER] (the “Holder”).

          WHEREAS, the Company previously entered into the Warrant in connection with the sale of a
Subordinated Convertible Promissory Note, dated July 8, 2009, to Holder;

          WHEREAS, the Subordinated Convertible Promissory Note has previously been converted into
shares of the Company’s Series B Preferred Stock;

          WHEREAS, upon the conversion of the Subordinated Convertible Promissory Note, the Company
issued the Warrant to Holder;

          WHEREAS, the Company desires to amend the Warrant as set forth below;

          WHEREAS, pursuant to Section 11(c) of the Warrant, no amendment thereof shall be effective
unless such amendment is approved by the Requisite Holders;

          WHEREAS, on May ___, 2010 the Requisite Holders approved the amendment set forth herein; and

          WHEREAS, in furtherance of the above, the Company desires to formally amend the terms of the
Warrant as set forth below:

1. Warrant Amendment. Section 6 of the Warrant is hereby amended and restated in its
entirety to read as follows:

     “6. Adjustments

     (a) Adjustment for Certain Events. In the event of
changes in the outstanding Shares (or the Company’s Common

 

 

Stock in the event the Shares have been converted into Common Stock)
by reason of stock dividends, split-ups, recapitalizations,
reclassifications, mergers, consolidations, combinations or exchanges
of shares, separations, reorganizations, liquidations, or the like,
the number and class of shares available for purchase pursuant to this
Warrant in the aggregate and the Warrant Price shall be
correspondingly adjusted, as appropriate, by the Board of Directors of
the Company. The adjustment shall be such as will give the Holder of
this Warrant upon exercise for the same aggregate Warrant Price the
total number, class and kind of shares as he would have owned had the
Warrant been exercised prior to the event and had he continued to hold
such shares until after the event requiring adjustment.

     (b) Adjustment for Conversion of Series B Preferred
Stock. If all of the outstanding shares of Series B Preferred
Stock are converted into Common Stock of the Company in accordance
with the terms of the Certificate of Incorporation of the Company, as
amended from time to time, then, effective upon such conversion, (i)
this Warrant shall be exercisable for such number of shares of Common
Stock as is equal to the number of shares of Common Stock that each
share of Series B Preferred Stock was converted into, multiplied by
the number of shares of Series B Preferred Stock subject to this
Warrant immediately prior to such conversion, (ii) the Warrant Price
shall be the Warrant Price in effect immediately prior to such
conversion divided by the number of shares of Common Stock into which
each share of Series B Preferred Stock was converted, and (iii) all
references in this Warrant to “Preferred Stock” and “Series B
Preferred Stock” shall thereafter be deemed to refer to “Common
Stock.”

	 	2.	 	All other terms in the Warrant shall remain in full force and effect; provided that
to the extent that any term in the Warrant would be inconsistent with the actions taken
hereunder, such term shall be deemed to be modified so as to be consistent with the
modification of terms set forth above.
	 
	 	3.	 	This Warrant Amendment shall be construed in accordance with the provisions of
Delaware law.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

 

          IN WITNESS WHEREOF, the undersigned has executed this Warrant Amendment as of the date set
forth above.

	 	 	 	 	 
	 	NUPATHE INC.

 	 
	 	By:  	 	 
	 	 	Name:  	Keith A. Goldan 	 
	 	 	Title:  	Chief Financial Officerexv4w4

Exhibit 4.4

THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE AND, EXCEPT AND PURSUANT TO THE
PROVISIONS OF ARTICLE 5 BELOW, MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR
HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAW OR, IN
THE OPINION OF LEGAL COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURITIES,
SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS EXEMPT FROM REGISTRATION.

WARRANT TO PURCHASE STOCK

Company: NuPathe, Inc., a Delaware corporation

Number of Shares: As set forth below

Class of Stock: Series B Preferred Stock, $0.001 par value per share

Warrant Price: $0.93, subject to adjustment as set forth herein

Issue Date: May 13, 2010

Expiration Date: May 13, 2020

	Credit Facility: 	This Warrant is issued in connection with that certain
Loan and Security Agreement of even date herewith by and
among MidCap Funding III, LLC, Silicon Valley Bank and
the Company (as amended and in effect from time to time,
the “Loan Agreement”).

     THIS WARRANT CERTIFIES THAT, for good and valuable consideration, MIDCAP FUNDING III, LLC
(together with any successor or permitted assignee or transferee of this Warrant or of any Shares
issued upon exercise or conversion hereof, “Holder”) is entitled to purchase the number of fully
paid and non-assessable shares (the “Shares”) of the above-stated Class of Stock (the “Class”) of
the above-named company (the “Company”) at the above-stated Warrant Price per Share, all as set
forth above and as adjusted pursuant to Article 2 of this Warrant, subject to the provisions and
upon the terms and conditions set forth in this Warrant.

     A. Number of Shares. Upon each Term Loan (as defined in the Loan Agreement) made by
Holder (or its affiliate) to the Company under the Loan Agreement, this Warrant automatically shall
become exercisable for such number of shares of the Class (cumulatively, the “Shares”) as shall
equal (a)(i) 0.0475, multiplied by (ii) the original principal amount of such Term Loan made by
Holder (or its affiliate), divided by (b) the Warrant Price in effect on and as of the date of such
Term Loan, and subject to adjustment thereafter from time to time in accordance with the provisions
of this Warrant.

ARTICLE 1. EXERCISE.

          1.1 Method of Exercise. Holder may exercise this Warrant by delivering the original
of this Warrant together with a duly executed Notice of Exercise in substantially the form attached
as Appendix 1 to the principal office of the Company. Unless Holder is exercising the conversion
right set forth in Article 1.2, Holder shall also deliver to the Company a check, wire transfer (to
an account designated by the

 

 

Company), or other form of payment acceptable to the Company for the aggregate Warrant Price for
the Shares being purchased.

          1.2 Conversion Right. If the fair market value of one Share (as determined pursuant
to Article 1.3) is greater than the Warrant Price (at the date of such calculation), then in lieu
of exercising this Warrant as specified in Article 1.1, Holder may from time to time convert this
Warrant, in whole or in part, into a number of Shares determined by dividing (a) the aggregate fair
market value of the Shares or other securities otherwise issuable upon exercise of this Warrant
minus the aggregate Warrant Price of such Shares by (b) the fair market value of one Share. The
fair market value of the Shares shall be determined pursuant to Article 1.3.

          1.3 Fair Market Value. If the Company’s common stock is traded in a public market and
the Shares are common stock, the fair market value of a Share shall be the closing price of a share
of common stock reported for the business day immediately before Holder delivers this Warrant
together with its Notice of Exercise to the Company (or in the instance where the Warrant is
exercised immediately prior to the effectiveness of the Company’s initial public offering (“IPO”),
the initial public offering price as set forth in the final prospectus relating to such offering).
If the Company’s common stock is traded in a public market and the Shares are preferred stock, the
fair market value of a Share shall be the closing price of a share of the Company’s common stock
reported for the business day immediately before Holder delivers this Warrant together with its
Notice of Exercise to the Company (or, in the instance where the Warrant is exercised immediately
prior to the effectiveness of the IPO, the initial public offering price as set forth in the final
prospectus relating to such offering), in both cases, multiplied by the number of shares of the
Company’s common stock into which a Share is convertible. If the Company’s common stock is not
traded in a public market, the Board of Directors of the Company shall determine fair market value
in its reasonable good faith judgment.

          1.4 Delivery of Certificate and New Warrant. Promptly after Holder exercises or
converts this Warrant and, if applicable, the Company receives payment of the aggregate Warrant
Price, the Company shall deliver to Holder certificates for the Shares acquired and, if this
Warrant has not been fully exercised or converted and has not expired, a new warrant of like tenor
representing the Shares not so acquired.

          1.5 Replacement of Warrants. On receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of loss,
theft or destruction, on delivery of an indemnity agreement reasonably satisfactory in form and
amount to the Company or, in the case of mutilation, on surrender and cancellation of this Warrant,
the Company shall execute and deliver, in lieu of this Warrant, a new warrant of like tenor.

          1.6 Treatment of Warrant Upon Acquisition of Company.

               1.6.1 “Acquisition”. For the purpose of this Warrant, “Acquisition” means any sale or
other disposition of all or substantially all of the assets of the Company, or any reorganization,
consolidation, merger, or sale of outstanding equity securities of the Company by the holders
thereof, where the holders of the Company’s outstanding voting equity securities as of immediately
before the transaction beneficially

2

 

own less than a majority of the outstanding voting equity securities of the surviving or successor
entity as of immediately after the transaction.

               1.6.2 Treatment of Warrant at
Acquisition.

A) Holder agrees that, in the event of an Acquisition in which the sole consideration is cash
and/or Marketable Securities, this Warrant shall terminate on and as of the closing of such
Acquisition to the extent not previously exercised. The Company shall provide Holder with written
notice of any proposed Acquisition not later than ten (10) days prior to the closing thereof
setting forth the material terms and conditions thereof, and shall provide Holder with copies of
the draft transaction agreements and other documents in connection therewith and with such other
information respecting such proposed Acquisition as may reasonably be requested by Holder.

B) Upon the closing of any Acquisition other than as particularly described in subsection (A)
above, the surviving or successor entity shall assume this Warrant and the obligations of the
Company hereunder, and this Warrant shall, from and after such closing, be exercisable for the same
class, number and kind of securities, cash and other property as would have been paid for or in
respect of the Shares issuable (as of immediately prior to such closing) upon exercise in full
hereof as if such Shares had been issued and outstanding on and as of such closing, at an aggregate
Warrant Price equal to the aggregate Warrant Price in effect as of immediately prior to such
closing; and subject to further adjustment thereafter from time to time in accordance with the
provisions of this Warrant.

C) As used in this Article 1.6, “Marketable Securities” means securities meeting all of the
following requirements: (i) the issuer thereof is then subject to the reporting requirements of
Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), and is then current in its filing of all required reports and other information under the
Act and the Exchange Act; (ii) the class and series of shares or other security of the issuer that
would be received by Holder in connection with the Acquisition were Holder to exercise or convert
this Warrant on or prior to the closing thereof is then traded on a national securities exchange or
over-the-counter market, and (iii) Holder would not be restricted by contract or by applicable
federal and state securities laws from publicly re-selling, within six (6) months and one day
following the closing of such Acquisition, all of the issuer’s shares and/or other securities that
would be received by Holder in such Acquisition were Holder to exercise or convert this Warrant in
full on or prior to the closing of such Acquisition.

          1.7 Put Option.

               1.7.1 Holder shall have the right, but not the obligation, to require the Company to purchase
from Holder (“Put Option”) some or all of this Warrant at any time (i) upon or immediately prior to
the occurrence of the closing of an Acquisition, or liquidation, dissolution or winding up of the
Company, or (ii) upon, following or immediately prior to the occurrence of (1) any “Event of
Default” (as such term is defined in the Loan Agreement), or (2) maturity of the Obligations (as
defined in the Loan Agreement) (each of the events described in clauses (i) and (ii) of this
Article 1.7.1 a “Trigger Event”). The purchase price to the Company therefor (“Put Price”) shall
be equal to (x)(i) the then-fair market value of a Share (as determined in accordance with Article
1.3 above), less (ii) the then-effective Warrant Price, multiplied by (y) the

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aggregate number of Shares issuable upon exercise or conversion hereof as to which Holder has
exercised the Put Option.

               1.7.2 The Put Option may be exercised by written notice given by Holder to the Company: (a) in
connection with a Trigger Event described in Article 1.7.1(i) above, within twenty (20) days
following Holder’s receipt of written notice of such Trigger Event (but in no event later than
three (3) days prior to the closing of such Trigger Event, (b) in connection with a Trigger Event
described in Article 1.7.1(ii)(1) above, within thirty (30) days following the declaration by a
Lender or Administrative Agent (as each such term is defined in the Loan Agreement) of such Trigger
Event, and (c) in connection with a Trigger Event described in Article 1.7.1(ii)(2) above, at any
time prior to, or within thirty (30) days after, such Trigger Event. The closing of the purchase
and sale of the Warrant upon exercise by Holder of the Put Option shall be effected: (x) in
connection with a Trigger Event described in Article 1.7.1(i) above, within 30 days of the closing
thereof, or (y) in connection with a Trigger Event described in Article 1.7.1(ii) above, within 30
days of the determination of fair market value of the Shares. At the closing, the Put Price shall
be paid to Holder by the Company in cash (by certified check or wire transfer of immediately
available funds) in a single installment against delivery of this original Warrant. If less than
all of the Shares evidenced by this Warrant are being purchased at such closing pursuant to
Holder’s exercise of the Put Option, the Company shall also deliver to Holder thereat a new warrant
of like tenor evidencing the Shares as to which the Put Option was not so exercised. In the event
that the Company fails to pay to Holder the full Put Price at the closing of Holder’s exercise of
the Put Option at the time and in the manner required under this Article 1.7, then in addition to
any and all other remedies at law and in equity which Holder has or may have in respect thereof,
the unpaid portion of the Put Price shall bear interest, payable to Holder on demand, at the
Default Rate (as defined in the Loan Agreement), compounded daily, until paid in full.

               1.7.3 Notwithstanding any provision herein to the contrary, the Put Option shall terminate and
be of no further force or effect from and following the consummation of the IPO to the extent not
previously exercised by Holder prior to the consummation of the IPO.

ARTICLE 2. ADJUSTMENTS TO THE SHARES.

          2.1 Stock Dividends, Splits, Etc. If the Company declares or pays a dividend on the
outstanding shares of the Class payable in common stock or other securities, then upon exercise of
this Warrant, for each Share acquired, Holder shall receive, without cost to Holder, the total
number and kind of securities to which Holder would have been entitled had Holder owned the Shares
of record as of the date the dividend occurred. If the Company subdivides the outstanding shares
of the Class by reclassification or otherwise into a greater number of shares, the number of Shares
purchasable hereunder shall be proportionately increased and the Warrant Price shall be
proportionately decreased. If the outstanding shares of the Class are combined or consolidated, by
reclassification or otherwise, into a lesser number of shares, the Warrant Price shall be
proportionately increased and the number of Shares shall be proportionately decreased.

          2.2 Reclassification, Exchange or Substitution.

4

 

               (a) Upon any reclassification, exchange, substitution, or other event affecting the
outstanding shares of the Class, Holder shall be entitled to receive, upon exercise or conversion
of this Warrant, the number and kind of securities and property that Holder would have received for
the Shares if this Warrant had been exercised in full immediately before such reclassification,
exchange, substitution, or other event, at an aggregate Warrant Price not exceeding the aggregate
Warrant Price in effect as of immediately prior thereto. Such an event shall include, without
limitation, any automatic or voluntary conversion of all outstanding shares of the Class to common
stock pursuant to the terms of the Company’s Certificate of Incorporation. The Company or its
successor shall promptly issue to Holder a certificate pursuant to Article 2.8 hereof setting forth
the number, class and series or other designation of such new securities or other property issuable
upon exercise or conversion of this Warrant as a result of such reclassification, exchange,
substitution or other event. The provisions of this Article 2.2 shall similarly apply to
successive reclassifications, exchanges, substitutions, or other events.

               (b) Notwithstanding the foregoing, if all of the outstanding shares of Series B Preferred
Stock of the Company are converted into Common Stock of the Company in accordance with the terms of
the Certificate of Incorporation of the Company, as amended from time to time, then, effective upon
such conversion, (i) this Warrant shall be exercisable for such number of shares of Common Stock as
is equal to the number of shares of Common Stock that each share of Series B Preferred Stock was
converted into, multiplied by the number of shares of Series B Preferred Stock subject to this
Warrant immediately prior to such conversion, (ii) the Warrant Price shall be the Warrant Price in
effect immediately prior to such conversion divided by the number of shares of Common Stock into
which each share of Series B Preferred Stock was converted, and (iii) all references in this
Warrant to “Class,” “Preferred Stock” and “Series B Preferred Stock” shall thereafter be deemed to
refer to “Common Stock” of the Company.

          2.3 Adjustments for Diluting Issuances. The number of shares of common stock
issuable upon conversion of the Shares shall be subject to adjustment, from time to time in the
manner set forth in the Company’s Certificate of Incorporation as if the Shares were issued and
outstanding on and as of the date of any such required adjustment. The provisions set forth for
the Class in the Company’s Certificate of Incorporation relating to the above in effect as of the
Issue Date may not be amended, modified or waived, without the prior written consent of Holder
unless such amendment, modification or waiver affects the rights associated with the Shares in the
same manner as such amendment, modification or waiver affects the rights associated with all other
shares of the Class.

          2.4 Adjustment to Warrant Price on Cash Dividend. At all times prior to the IPO, in
the event that the Company at any time prior or from time to time prior to exercise or conversion
in full of this Warrant pays any cash dividend on the outstanding shares of the Class or makes any
cash distribution on or in respect of the outstanding shares of the Class, then on and as of the
date of such dividend payment or the making of such distribution, the Warrant Price shall be
reduced by an amount equal to the amount paid or distributed upon or in respect of each
outstanding share of the Class.

          2.5 No Impairment. The Company shall not, by amendment of its Certificate of
Incorporation or through a reorganization, transfer of assets, consolidation,

5

 

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 under this
Warrant by the Company, but shall at all times in good faith assist in carrying out of all the
provisions of this Article 2 and in taking all such action as may be both commercially reasonable
and necessary or appropriate to protect Holder’s rights under this Article against impairment.

          2.6 Fractional Shares. No fractional Shares shall be issuable upon exercise or
conversion of the Warrant and the number of Shares to be issued shall be rounded down to the
nearest whole Share. If a fractional share interest arises upon any exercise or conversion of the
Warrant, the Company shall eliminate such fractional share interest by paying Holder the amount
computed by multiplying the fractional interest by the fair market value of a full Share.

          2.7 Pay to Play Adjustments. Notwithstanding the definition of Class herein, if Pay to
Play Provisions are at any time during the term of this Warrant applied to the outstanding shares
of the Class, then from and after such application, “Class” shall mean that class and series of the
Company’s securities that a holder of outstanding shares of the Class as of immediately prior to
such application would have received or retained had such holder participated in the manner
necessary to receive or retain the class and series of the Company’s securities having the relative
rights, powers, privileges and preferences more favorable to the holder. As used herein, “Pay to
Play Provisions” means provisions set forth in the Company’s Certificate of Incorporation or
elsewhere that require holders of the outstanding shares of the Class to participate in a
subsequent round of equity financing of the Company or lose all or a portion of the benefit of
anti-dilution protection or any other right, power, privilege or preference applicable to such
shares or have such shares automatically convert to common stock or another class or series of
Company capital stock.

          2.8 Certificate as to Adjustments. Upon each adjustment of the Warrant Price, Class
and/or number of Shares, the Company shall promptly notify Holder in writing, and, at the Company’s
expense, promptly compute such adjustment, and furnish Holder with a certificate of its Chief
Financial Officer setting forth such adjustment and the facts upon which such adjustment is based.
The Company shall, upon written request, furnish Holder a certificate setting forth the Warrant
Price, Class and number of Shares in effect upon the date thereof and the series of adjustments
leading to such Warrant Price, Class and number of Shares.

ARTICLE 3. REPRESENTATIONS AND COVENANTS OF THE COMPANY.

          3.1 Representations and Warranties. The Company represents and warrants to, and
agrees with, the Holder as follows:

               (a) The initial Warrant Price first set forth above is not greater than the price per share at
which shares of the Class were last issued in an arms-length transaction in which at least $500,000
of such shares were sold.

               (b) All Shares which may be issued upon the exercise of the purchase right represented by this
Warrant, and all securities, if any, issuable upon conversion of the Shares, shall at all time be
duly reserved for issuance out of the authorized and unissued capital stock of the Company and
shall, upon issuance in

6

 

accordance with the provisions hereof, be duly authorized, validly issued, fully paid and
non-assessable, and free of any liens and encumbrances except for restrictions on transfer provided
for herein or under applicable federal and state securities laws.

               (c) The Company’s capitalization table attached hereto as Schedule 1 is true and
complete as of the Issue Date.

          3.2 Notice of Certain Events. If the Company proposes at any time (a) to declare any
dividend or distribution upon the outstanding shares of the Class, whether in cash, property,
stock, or other securities and whether or not a regular cash dividend; (b) to offer for
subscription or sale pro rata to the holders of the outstanding shares of the Class any additional
shares of any class or series of the Company’s stock; (c) to effect any reclassification,
reorganization or recapitalization of the shares of the Class; (d) to effect an Acquisition or to
liquidate, dissolve or wind up; or (e) offer holders of registration rights the opportunity to
participate in an underwritten public offering of the Company’s securities for cash, then, in
connection with each such event, the Company shall give Holder: (1) at least 10 days prior written
notice of the date on which a record will be taken for such dividend, distribution, or subscription
rights (and specifying the date on which the holders of shares of the Class will be entitled
thereto) or for determining rights to vote, if any, in respect of the matters referred to in (c)
and (d) above; (2) in the case of the matters referred to in (c) and (d) above at least 10 days
prior written notice of the date when the same will take place (and specifying the date on which
the holders of shares of the Class will be entitled to exchange their shares for the securities or
other property deliverable upon the occurrence of such event); and (3) in the case of the matter
referred to in (e) above, the same notice as is given to the holders of such registration rights.

          3.3 Registration Under Securities Act of 1933, as amended. The Company agrees that
the Shares or, if the Shares are convertible into common stock of the Company, such common stock,
shall have certain registration rights pursuant to and as set forth in Sections 2.2 through 2.14
inclusive, and 3 (the “Applicable Sections”) of the Company’s Amended and Restated Investor Rights
Agreement, dated July 8, 2008, as amended from time to time (the “Investor Rights Agreement”);
provided, that (1) Holder shall not be permitted to be an Initiating Holder (as defined in
the Investor Rights Agreement) for purposes of making a Demand Request (as defined in the Investor
Rights Agreement) under Section 2.2(a) of the Investor Rights Agreement, and (2) Holder will be
subject to all of the obligations set forth in the Applicable Sections as if Holder were an
original “Holder” (as defined in the Investor Rights Agreement) thereunder. The Applicable
Sections in effect as of the Issue Date may not be amended, modified or waived without the prior
written consent of Holder unless such amendment, modification or waiver affects the rights
associated with the Shares in the same manner as such amendment, modification, or waiver affects
the rights associated with all other shares of the Class whose holders are parties thereto.

          3.4 No Shareholder Rights. Except as provided in this Warrant, Holder will not have
any rights as a shareholder of the Company until the exercise of this Warrant.

          3.5 Certain Information. The Company agrees to provide Holder at any time and from
time to time with such information as Holder may reasonably request

7

 

for purposes of Holder’s compliance with regulatory, accounting and reporting requirements
applicable to Holder.

ARTICLE 4. REPRESENTATIONS, WARRANTIES OF THE HOLDER. The Holder represents and warrants
to the Company as follows:

          4.1 Purchase for Own Account. This Warrant and the securities to be acquired upon
exercise of this Warrant by Holder will be acquired for investment for Holder’s account, not as a
nominee or agent, and not with a view to the public resale or distribution within the meaning of
the Act. Holder also represents that it has not been formed for the specific purpose of acquiring
this Warrant or the Shares.

          4.2 Disclosure of Information. Holder has received or has had full access to all the
information it considers necessary or appropriate to make an informed investment decision with
respect to the acquisition of this Warrant and its underlying securities. Holder further has had
an opportunity to ask questions and receive answers from the Company regarding the terms and
conditions of the offering of this Warrant and its underlying securities and to obtain additional
information (to the extent the Company possessed such information or could acquire it without
unreasonable effort or expense) necessary to verify any information furnished to Holder or to which
Holder has access.

          4.3 Investment Experience. Holder understands that the purchase of this Warrant and
its underlying securities involves substantial risk. Holder has experience as an investor in
securities of companies in the development stage and acknowledges that Holder can bear the economic
risk of such Holder’s investment in this Warrant and its underlying securities and has such
knowledge and experience in financial or business matters that Holder is capable of evaluating the
merits and risks of its investment in this Warrant and its underlying securities and/or has a
preexisting personal or business relationship with the Company and certain of its officers,
directors or controlling persons of a nature and duration that enables Holder to be aware of the
character, business acumen and financial circumstances of such persons.

          4.4 Accredited Investor Status. Holder is an “accredited investor” within the meaning
of Regulation D promulgated under the Act.

          4.5 The Act. Holder understands that this Warrant and the Shares issuable upon
exercise or conversion hereof have not been registered under the Act in reliance upon a specific
exemption therefrom, which exemption depends upon, among other things, the bona fide nature of the
Holder’s investment intent as expressed herein. Holder understands that this Warrant and the
Shares issued upon any exercise or conversion hereof must be held indefinitely unless subsequently
registered under the Act and qualified under applicable state securities laws, or unless exemption
from such registration and qualification are otherwise available.

          4.6 Market “Stand-Off” Agreement. Holder agrees to comply with and be bound by the
provisions of Section 2.13 of the Investor Rights Agreement to the same extent as all other holders
of shares of the Class are bound thereby.

ARTICLE 5. MISCELLANEOUS.

8

 

          5.1 Term: This Warrant is exercisable in whole or in part at any time and from time
to time on or before the Expiration Date.

          5.2 Legends. This Warrant and the Shares (and the securities issuable, directly or
indirectly, upon conversion of the Shares, if any) shall be imprinted with a legend in
substantially the following form:

THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED
UNDER THE ACT, OR THE SECURITIES LAWS OF ANY STATE AND, EXCEPT AND
PURSUANT TO THE PROVISIONS OF ARTICLE 5 OF THAT CERTAIN WARRANT TO
PURCHASE STOCK ISSUED BY THE COMPANY TO MIDCAP FUNDING III, LLC DATED AS
OF _________, MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED,
PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND
APPLICABLE STATE SECURITIES LAW OR, IN THE OPINION OF LEGAL COUNSEL IN
FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH
OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS EXEMPT FROM
REGISTRATION.

          5.3 Compliance with Securities Laws on Transfer. This Warrant and the Shares issuable
upon exercise of this Warrant (and the securities issuable, directly or indirectly, upon conversion
of the Shares, if any) may not be transferred or assigned in whole or in part without compliance
with applicable federal and state securities laws by the transferor and the transferee (including,
without limitation, the delivery of investment representation letters and legal opinions reasonably
satisfactory to the Company, as reasonably requested by the Company). The Company shall not
require Holder to provide an opinion of counsel if the transfer is to any affiliate of Holder,
provided that any such affiliate transferee is an “accredited investor” as defined in Regulation D
promulgated under the Act.

          5.4 Transfer Procedure. Subject to the provisions of Article 5.3 and upon
providing the Company with written notice, Holder may transfer all or part of this Warrant or the
Shares issuable upon exercise of this Warrant (or the securities issuable directly or indirectly,
upon conversion of the Shares, if any) to any transferee, provided, however, in connection with any
such transfer, Holder will give the Company notice of the portion of the Warrant being transferred
with the name, address and taxpayer identification number of the transferee and Holder will
surrender this Warrant to the Company for reissuance to the transferee(s) (and Holder if
applicable). The Company may refuse to transfer this Warrant or the Shares to any person who (i)
directly competes with the Company, unless, in either case, the stock of the Company is publicly
traded or (ii) fails to agree in writing to agree to be bound by the terms of this Warrant as if an
original holder hereof.

          5.5 Notices. All notices and other communications from the Company to the Holder, or
vice versa, shall be deemed delivered and effective when given personally or mailed by first-class
registered or certified mail, postage prepaid (or on the first business day after transmission by
facsimile), at such address as may have been furnished to the Company or Holder, as the case may
be, in writing by the Company or

9

 

such holder from time to time. All notices to Holder shall be addressed as follows until the
Company receives notice of a change of address in connection with a transfer or otherwise:

MidCap Funding III, LLC

7735 Old Georgetown Road, Suite 400

Bethesda, Maryland 20814

Attention: Portfolio Management- Life Sciences

Telephone:

Facsimile:

     Notice to the Company shall be addressed as follows until Holder receives notice of a change
in address:

NuPathe, Inc.

Attn: Keith A. Goldan

227 Washington Street, Suite 200

Conshohocken, Pennsylvania 19428

Telephone: 484.567.0130

Facsimile: 484.567.0136

          5.6 Waiver. This Warrant and any term hereof may be changed, waived, discharged or
terminated only by an instrument in writing signed by the party against which enforcement of such
change, waiver, discharge or termination is sought.

          5.7 Attorney’s Fees. In the event of any dispute between the parties concerning the
terms and provisions of this Warrant, the party prevailing in such dispute shall be entitled to
collect from the other party all costs incurred in such dispute, including reasonable attorneys’
fees.

          5.8 Automatic Conversion upon Expiration. In the event that, upon the Expiration
Date, the fair market value of one Share (or other security issuable upon the exercise hereof) as
determined in accordance with Article 1.3 above is greater than the Warrant Price in effect on such
date, then this Warrant shall automatically be deemed on and as of such date to be converted
pursuant to Article 1.2 above as to all Shares (or such other securities) for which it shall not
previously have been exercised or converted, and the Company shall promptly deliver a certificate
representing the Shares (or such other securities) issued upon such conversion to Holder.

          5.9 Counterparts. This Warrant may be executed in counterparts, all of which together
shall constitute one and the same agreement.

          5.10 Governing Law. This Warrant shall be governed by and construed in accordance
with: (i) to the extent applicable, the General Corporation Law of the State of Delaware, and (ii)
otherwise, the internal domestic laws of the State of Maryland, without giving effect to its
principles regarding conflicts of law.

[Remainder of page left blank intentionally; signature page follows]

10

 

     IN WITNESS WHEREOF, the parties hereto have caused this Warrant to Purchase Stock to be duly
executed as of the date first set forth above.

	 	 	 	 	 
	“COMPANY”

NUPATHE, INC.

 	 	 
	By:  	/s/ Keith A. Goldan
 	 	 
	 	Name:  	Keith A. Goldan 	 	 
	 	  	(Print)

 	 	 
	 	Title:  	

CFO 	 	 
	 
	“HOLDER”

MIDCAP FUNDING III, LLC

 	 	 
	By:  	/s/ Josh Groman
 	 	 
	 	Name:  	/s/ Josh Groman 	 	 
	 	  	(Print)
 	 	 
	 	Title:  	
Managing Director 	 	 

11

 

	 	 	 	 	 

APPENDIX 1

NOTICE OF EXERCISE

     1. Holder elects to purchase _________ shares of the Common/Series ______
Preferred [strike
one] Stock of _______________ pursuant to the terms of the attached Warrant, and tenders payment
of the purchase price of the shares in full.

          [or]

     1. Holder elects to convert the attached Warrant into Shares/cash [strike one] in the manner
specified in the Warrant. This conversion is exercised for __________________ of the Shares
covered by the Warrant.

     [Strike paragraph that does not apply.]

     2. Please issue a certificate or certificates representing the Shares in the name specified
below:

	 	 	 	 	 

	 

	 	 

	 	 
	 

	 	Holders Name	 	 
	 

	 	 

	 	 
	 

	 	 

	 	 
	 

	 	(Address)	 	 

     3. By its execution below and for the benefit of the Company, Holder hereby restates each of
the representations and warranties in Article 4 of the Warrant as of the date hereof.

	 	 	 	 	 
	 	HOLDER:

 
 

	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 	 	(Date):  	 	 

12

 

	 	 	 	 	 

SCHEDULE 1

Company Capitalization Table

See attached

1215188.5

13

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