NORTHWEST BIOTHERAPEUTICS INC
EXHIBIT 10.8
<DOCUMENT>
<TYPE>EX-10.8
<SEQUENCE>9
<FILENAME>v00943exv10w8.txt
<DESCRIPTION>EXHIBIT 10.8
<TEXT>
<PAGE>

                                                                    Exhibit 10.8

                                                               EXECUTION VERSION

THIS WARRANT AND THE UNDERLYING SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). THEY MAY NOT BE SOLD, OFFERED
FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT AS TO SUCH SECURITIES UNDER THE ACT OR UNLESS SUCH TRANSACTION IS IN
COMPLIANCE WITH APPLICABLE FEDERAL AND STATE SECURITIES LAWS.

                         NORTHWEST BIOTHERAPEUTICS, INC.

                                     WARRANT

NO. BW-3                                                           JUNE 11, 2004

      THIS CERTIFIES THAT, for value received, TOUCAN CAPITAL FUND II, L.P.,
with its principal office at 7600 Wisconsin Avenue, Suite 700, Bethesda, MD
20814, and/or its designees or assigns (collectively, the "HOLDER"), is entitled
to subscribe for and purchase from NORTHWEST BIOTHERAPEUTICS, INC., a Delaware
corporation, with its principal office at 22322 20th Avenue SE, Suite 150,
Bothell, Washington 98021 (the "COMPANY"), such number of Exercise Shares as
provided herein at the Exercise Price (each subject to adjustment as provided
herein). This Warrant is being issued pursuant to the terms of the
Recapitalization Agreement, dated April 26, 2004, by and among the Company and
the Holder, as amended and/or restated from time to time (the "RECAPITALIZATION
AGREEMENT"), along with Warrant No. BW-2, to Holder in exchange for Warrant No.
BW-1.

      1. DEFINITIONS. Capitalized terms used but not defined herein shall have
the meanings set forth in the Recapitalization Agreement or Related
Recapitalization Document, as applicable. As used herein, the following terms
shall have the following respective meanings:

            (a) "CAPITAL STOCK" shall mean the securities for which this Warrant
is exercisable as provided in Section 2.2 hereof.

            (b) "DENOMINATOR SHARE PRICE" shall mean $0.05.

            (c) "EXERCISE PERIOD" shall mean the period (a) commencing July 30,
2004 and (b) ending June 11, 2011.

            (d) "EXERCISE PRICE" shall mean $0.01 per Exercise Share, subject to
adjustment pursuant to the terms herein.

            (e) "EXERCISE SHARES" shall mean a number of shares of Capital Stock
equal to the quotient of (i) 300% (i.e., 3.0) multiplied by the Note Amount,
divided by (ii) the Denominator Share Price, subject to adjustment pursuant to
the terms herein.

            (f) "NOTE AMOUNT" shall mean $500,000.

                                       1.
<PAGE>

                                                               EXECUTION VERSION

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

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

            (B) Payment of the Exercise Price either (i) in cash or by check, or
(ii) by cancellation of indebtedness; and

            (C) This Warrant.

      Upon the exercise of the rights represented by this Warrant, a certificate
or certificates for the Exercise Shares so purchased, registered in the name of
the Holder or persons affiliated with the Holder, if the Holder so designates,
shall be issued and delivered to the Holder within a reasonable time after the
rights represented by this Warrant shall have been so exercised. In the event
that this Warrant is being exercised for less than all of the then-current
number of Exercise Shares purchasable hereunder, the Company shall, concurrently
with the issuance by the Company of the number of Exercise Shares for which this
Warrant is then being exercised, issue a new Warrant exercisable for the
remaining number of Exercise Shares purchasable hereunder.

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

      2.1 NET EXERCISE. Notwithstanding any provisions herein to the contrary,
if the fair market value of one Exercise Share is greater than the Exercise
Price (at the date of calculation as set forth below), in lieu of exercising
this Warrant by payment of cash, the Holder may elect to receive shares equal to
the value (as determined below) of this Warrant (or the portion thereof being
canceled) by surrender of this Warrant at the principal office of the Company
together with the properly endorsed Notice of Exercise in which event the
Company shall issue to the Holder a number of Exercise Shares computed using the
following formula:

                  X = Y (A-B)

                                    A

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

                  Y=    the number of Exercise Shares purchasable under the
                        Warrant or, if only a portion of the Warrant is being
                        exercised, that portion of the Warrant being canceled
                        (at the date of such calculation)

                  A     = the fair market value of one Exercise Share (at the
                        date of such calculation)

                                       2.
<PAGE>

                                                               EXECUTION VERSION

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

      For purposes of the above calculation, the fair market value of one
Exercise Share shall be determined by the Company's Board of Directors in good
faith; provided, however, that in the event that this Warrant is exercised
pursuant to this Section 2.1 in connection with the Company's initial public
offering of its Common Stock, the fair market value per share shall be the
product of (i) the per share offering price to the public of the Company's
initial public offering, and (ii) the number of shares of Common Stock into
which each Exercise Share is convertible at the time of such exercise.

      2.2 SECURITIES FOR WHICH WARRANT IS EXERCISABLE. In the event the
Convertible Preferred Stock is approved and authorized, and the terms and
conditions are the same as set forth in the Recapitalization Agreement and in
the Convertible Preferred Stock Term Sheet, and Other Investors have purchased
in cash (and not by conversion of debt, exercise of warrants or options, or
conversion or exercise of other securities or instruments) a minimum of $15
million of such Convertible Preferred Stock, on the terms and conditions set
forth in the Recapitalization Agreement and in the Convertible Preferred Stock
Term Sheet, then, subject to Section 5 hereof, this Warrant shall be exercisable
solely for such Convertible Preferred Stock. However, if, for any reason, such
Convertible Preferred Stock is not approved or authorized, and/or is approved or
authorized on any terms different than any terms set forth in the
Recapitalization Agreement and in the Convertible Preferred Stock Term Sheet,
and/or if Other Investors have not purchased in cash (and not by conversion of
debt, exercise of warrants or options, or conversion or exercise of other
securities or instruments) a minimum of $15 million of such Convertible
Preferred Stock, on the terms and conditions set forth in the Recapitalization
Agreement and in the Convertible Preferred Stock Term Sheet, this Warrant shall
be exercisable for any Equity Security and/or Debt Security and/or any
combination thereof, in each case that Holder shall designate in Holder's sole
discretion.

      3. COVENANTS OF THE COMPANY.

            3.1 COVENANTS AS TO EXERCISE SHARES. The Company covenants and
agrees that all Exercise Shares that may be issued upon the exercise of the
rights represented by this Warrant will, upon issuance, be validly issued and
outstanding, fully paid and nonassessable, and free from all taxes, liens and
charges with respect to the issuance thereof. The Company further covenants and
agrees that the Company will at all times during the Exercise Period, have
authorized and reserved, free from preemptive rights, a sufficient number of
shares of the series of equity securities comprising the Exercise Shares and the
Company's Common Stock to provide for the exercise of the rights represented by
this Warrant and the subsequent conversion of the Exercise Shares. If at any
time during the Exercise Period the number of authorized but unissued shares of
such series of the Company's equity securities or the Company's Common Stock
shall not be sufficient to permit exercise of this Warrant or the subsequent
conversion of the Exercise Shares, then, in addition to such other remedies as
may be available to Holder, including, without limitation, the exercise of
Holder's right of first refusal set forth in Section 2.7(f) of the
Recapitalization Agreement, the Company will take such corporate action as shall
be necessary to increase its authorized but unissued shares of such series of
the Company's equity securities or the Company's Common Stock, as appropriate,
to such number of shares as shall be sufficient for such purposes.

                                       3.
<PAGE>

                                                               EXECUTION VERSION

            3.3 NOTICES OF RECORD DATE. In the event of any taking by the
Company of a record of the holders of any class of securities for the purpose of
determining the holders thereof who are entitled to receive any dividend or
other distribution, the Company shall mail to the Holder, at least ten (10) days
prior to the date specified herein, a notice specifying the date on which any
such record is to be taken for the purpose of such dividend or distribution.

            3.4 NO IMPAIRMENT. The Company shall not, by amendment of its
Charter or through a reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities, or any other voluntary action,
omission or agreement, avoid or seek to avoid the observance or performance of
any of the terms to be observed or performed by the Company under and/or in
connection with this Warrant, but shall at all times in good faith use best
efforts to assist in carrying out of all the provisions of and/or relating to
this Warrant and in taking all such action as may be necessary or appropriate to
protect Holder's rights, preferences and privileges under and/or in connection
with this Warrant against impairment. The Holder's rights, preferences and
privileges granted under and/or in connection with this Warrant may not be
amended, modified or waived without the Holder's prior written consent, and the
documentation providing for such rights, preferences and privileges will
specifically provide as such.

            3.5 REGISTRATION RIGHTS. The Company agrees that the Underlying
Shares (as defined below) shall be "registrable securities" (or terms of similar
impact) under any agreement executed by the Company as part of the Anticipated
Equity Financing, or any other agreement executed by the Company in lieu of,
and/or in addition to, the Anticipated Equity Financing, in each case, for
purposes of providing registration rights under the Act to holders of shares of
Capital Stock, and the Company shall ensure that any such agreement conforms
with the requirements of this Section 3.4. Such registration rights may not be
amended, modified or waived without the prior written consent of the Holder.

      4. REPRESENTATIONS OF HOLDER.

            4.1 ACQUISITION OF WARRANT FOR PERSONAL ACCOUNT. The Holder
represents and warrants that it is acquiring the Warrant, the Exercise Shares
and the shares of Common Stock issuable upon conversion of the Exercise Shares
(the "UNDERLYING SHARES") solely for its account for investment and not with a
view to or for sale or distribution of said Warrant, Exercise Shares or
Underlying Shares, or any part thereof except in compliance with applicable
federal and state securities laws. The Holder also represents that the entire
legal and beneficial interests of the Warrant, the Exercise Shares and the
Underlying Shares the Holder is acquiring is being acquired for, and will be
held for, its account only.

      4.2 SECURITIES ARE NOT REGISTERED.

            (A) The Holder understands that the Warrant, the Exercise Shares and
the Underlying Shares have not been registered under the Securities Act of 1933,
as amended (the "ACT") on the basis that no distribution or public offering of
the stock of the Company is to be effected by the Holder. The Holder realizes
that the basis for the exemption may not be present if, notwithstanding its
representations, the Holder has a present intention of acquiring the securities
for a fixed or determinable period in the future, selling (in connection with a

                                       4.
<PAGE>

                                                               EXECUTION VERSION

distribution or otherwise), granting any participation in, or otherwise
distributing the securities. The Holder has no such present intention.

            (b) The Holder recognizes that the Warrant, the Exercise Shares and
the Underlying Shares must be held indefinitely unless they are subsequently
registered under the Act or an exemption from such registration is available;
provided, however, the parties acknowledge and agree that the Company has an
obligation to register the Underlying Shares as provided in the Recapitalization
Agreement and the Convertible Preferred Stock Term Sheet.

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

      4.3 DISPOSITION OF WARRANT, EXERCISE SHARES AND UNDERLYING SHARES.

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

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

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

                  (iii) The Holder shall have notified the Company of the
proposed disposition and shall have furnished the Company with a detailed
statement of the circumstances surrounding the proposed disposition, and such
disposition shall not be contrary to any applicable federal and/or state
securities laws.

            (b) The Holder understands and agrees that all certificates
evidencing the shares to be issued to the Holder may bear the following legend:

      THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
      1933, AS AMENDED (THE "ACT"). THEY MAY NOT BE SOLD, OFFERED FOR SALE,
      PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
      STATEMENT AS TO THE SECURITIES UNDER THE ACT OR UNLESS SUCH TRANSACTION IS
      IN COMPLIANCE WITH APPLICABLE FEDERAL AND STATE SECURITIES LAWS.

            4.4 ACCREDITED INVESTOR STATUS. The Holder is an "accredited
investor" as defined in Regulation D promulgated under the Act.

                                       5.
<PAGE>

                                                               EXECUTION VERSION

      5. ADJUSTMENT OF EXERCISE PRICE AND EXERCISE SHARES.

            5.1 CHANGES IN SECURITIES. In the event of changes in the series of
equity securities of the Company comprising the Exercise Shares by reason of
stock dividends, splits, recapitalizations, reclassifications, combinations or
exchanges of shares, separations, reorganizations, liquidations, or the like,
the number and class of Exercise Shares available under the Warrant in the
aggregate and the Exercise Price shall be correspondingly adjusted to give the
Holder of the Warrant, on exercise for the same aggregate Exercise Price, the
total number, class, and kind of shares as the Holder would have owned had the
Warrant been exercised prior to the event and had the Holder continued to hold
such shares until after the event requiring adjustment. For purposes of this
Section 5, the "AGGREGATE EXERCISE PRICE" shall mean the aggregate Exercise
Price payable in connection with the exercise in full of this Warrant. The form
of this Warrant need not be changed because of any adjustment in the number of
Exercise Shares subject to this Warrant.

            5.2 AUTOMATIC CONVERSION. Upon the automatic conversion of all
outstanding shares of the series of equity securities comprising the Exercise
Shares into Common Stock, if applicable, this Warrant shall become exercisable
for that number of shares of Common Stock of the Company into which the Exercise
Shares would then be convertible, so long as such shares, if this Warrant had
been exercised prior to such offering, would have been converted into shares of
the Company's Common Stock pursuant to the Company's Certificate of
Incorporation. In such case, all references to "Exercise Shares" shall mean
shares of the Company's Common Stock issuable upon exercise of this Warrant, as
appropriate.

            5.3 DILUTIVE ISSUANCES. If at any time prior to exercise of this
Warrant, the Company issues or sells, or is deemed to have issued or sold,
additional shares of Capital Stock for a nominal or effective price less than
the then effective Exercise Price (a "DILUTIVE ISSUANCE"), then and in each such
case, the then existing Exercise Price shall be reduced, as of the opening of
business on the date of such issue or sale, to the price at which such shares
are issued or sold, or deemed to be issued or sold. For purposes of this Section
5.3, the Company will be deemed to have issued or sold additional shares of
Capital Stock if it issues any security or instrument convertible, exercisable
or exchangeable for Capital Stock, or if it promises, undertakes, commits,
agrees or enters into any letter of intent to do so. Notwithstanding the
foregoing, (i) no further adjustment of the Exercise Price shall be made as a
result of the actual issuance of shares of Capital Stock upon the conversion,
exercise or exchange of any such instrument or in satisfaction of any such
undertaking, commitment, agreement or letter of intent, and (ii) no adjustment
of the Exercise Price shall be made as a result of the actual issuance of any
shares of Common Stock pursuant to the exercise of those certain options to
purchase up to 35,000 shares of Common Stock at a purchase price of $0.0001 per
share that were outstanding on April 26, 2004 and held by members of the Board
of Directors of the Company.

            5.4 CERTIFICATE OF ADJUSTMENTS. Upon each adjustment of the Exercise
Price and/or Exercise Shares, the Company shall promptly notify the Holder in
writing and furnish the Holder with a certificate of its Chief Financial Officer
setting forth such adjustment and the facts upon which such adjustment is based.

                                       6.
<PAGE>

                                                               EXECUTION VERSION

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

      7. TRANSFER OF WARRANT. Subject to applicable laws, this Warrant and all
rights hereunder are transferable, in whole or in part, at any time or times by
the Holder, upon delivery of this Warrant and the form of assignment attached
hereto to any transferee designated by Holder. The transferee shall sign a
customary investment letter in form and substance reasonably satisfactory to the
Company.

      8. LOST, STOLEN, MUTILATED OR DESTROYED WARRANT. If this Warrant is lost,
stolen, mutilated or destroyed, the Company may, on such terms as to indemnity
or otherwise as it may reasonably impose (which shall, in the case of a
mutilated Warrant, include the surrender thereof), issue a new Warrant of like
denomination and tenor as the Warrant so lost, stolen, mutilated or destroyed.
Any such new Warrant shall constitute an original contractual obligation of the
Company, whether or not the allegedly lost, stolen, mutilated or destroyed
Warrant shall be at any time enforceable by anyone.

      9. AMENDMENT. Any term of this Warrant may be amended or waived only with
the written consent of the Company and the Holder.

      10. NOTICES, ETC. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given upon actual delivery to the
recipient. All communications shall be sent to the Company and to the Holder at
the addresses listed on the signature page hereof or at such other address as
the Company or Holder may designate by ten (10) days advance written notice to
the other parties hereto.

      11. GOVERNING LAW. This Warrant and all rights, obligations and
liabilities hereunder shall be governed by and construed under the laws of the
State of Delaware as applied to agreements among Delaware residents, made and to
be performed entirely within the State of Delaware without giving effect to
conflicts of laws principles.

                            [SIGNATURE PAGE FOLLOWS]

                                       7.
<PAGE>

                                                               EXECUTION VERSION

      IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by
its duly authorized officer as of the date first written above.

                                           NORTHWEST BIOTHERAPEUTICS, INC.

                                           By: /s/ Alton Boynton
                                               ________________________________

                                            Name: Alton Boynton

                                             Title: President

                                             Address:  22322 20th Avenue SE
                                                        Suite 150
                                                        Bothell, WA 98021
                                                        Fax: (425) 608-3146

ACKNOWLEDGED AND AGREED:

TOUCAN CAPITAL FUND II, L.P.

By: /s/ Linda Powers
    _______________________

Name:    Linda Powers

Title: Managing Director

Address:  7600 Wisconsin Avenue
           Suite 700
           Bethesda, MD  20814
           Fax:  (240) 497-4060

                      [SIGNATURE PAGE TO WARRANT NO. BW-3]

<PAGE>

                                                               EXECUTION VERSION

                               NOTICE OF EXERCISE

TO: NORTHWEST BIOTHERAPEUTICS, INC.

      (1) [ ] The undersigned hereby elects to purchase ________ shares of
___________ (the "EXERCISE SHARES") of NORTHWEST BIOTHERAPEUTICS, INC. (the
"COMPANY") pursuant to the terms of the attached Warrant, and tenders herewith
payment of the exercise price in full, together with all applicable transfer
taxes, if any.

      [ ] The undersigned hereby elects to purchase ________ shares of
__________ (the "EXERCISE SHARES") of NORTHWEST BIOTHERAPEUTICS, INC. (the
"COMPANY") pursuant to the terms of the net exercise provisions set forth in
Section 2.1 of the attached Warrant, and shall tender payment of all applicable
transfer taxes, if any.

      (2) Please issue a certificate or certificates representing said Exercise
Shares in the name of the undersigned or in such other name as is specified
below:

                                           __________________________
                                     (Name)

                                           __________________________

                                           __________________________
                                    (Address)

      (3) The undersigned represents that (i) the aforesaid Exercise Shares are
being acquired for the account of the undersigned for investment and not with a
view to, or for resale in connection with, the distribution thereof and that the
undersigned has no present intention of distributing or reselling such shares,
except in accordance with applicable federal and state securities laws; (ii) the
undersigned is aware of the Company's business affairs and financial condition
and has acquired sufficient information about the Company to reach an informed
and knowledgeable decision regarding its investment in the Company; (iii) the
undersigned is experienced in making investments of this type and has such
knowledge and background in financial and business matters that the undersigned
is capable of evaluating the merits and risks of this investment and protecting
the undersigned's own interests; (iv) the undersigned understands that Exercise
Shares issuable upon exercise of this Warrant have not been registered under the
Securities Act of 1933, as amended (the "SECURITIES ACT"), by reason of a
specific exemption from the registration provisions of the Securities Act, which
exemption depends upon, among other things, the bona fide nature of the
investment intent as expressed herein, and, because such securities have not
been registered under the Securities Act, they must be held indefinitely unless
subsequently registered under the Securities Act or an exemption from such
registration is available; (v) the undersigned is aware that the aforesaid
Exercise Shares may not be sold pursuant to Rule 144 adopted under the
Securities Act unless certain conditions are met and until the undersigned has
held the shares for the number of years prescribed by Rule 144, that among the
conditions for use of the Rule is the availability of current information to the
public about the Company; and (vi) the undersigned agrees not to make any
disposition of all or any part of the aforesaid shares of Exercise Shares unless
and until there is then in effect a registration statement under the Securities
Act covering such proposed disposition or unless such transaction is in
compliance with applicable federal and state securities laws.

                                       1.
<PAGE>

                                                               EXECUTION VERSION

____________________________                    _______________________________
Date                                            (Signature)

                                                _______________________________
                                                (Print name)

                                       2.
<PAGE>

                                                               EXECUTION VERSION

                                 ASSIGNMENT FORM

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

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

Name:
      ____________________________________________________________________
                                 (Please Print)

Address:
         __________________________________________________________________
                                 (Please Print)

Dated: __________, 20__

Holder's

Signature:
           ____________________________________________________________

Holder's

Address:
         ____________________________________________________________

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

                                       3.

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</DOCUMENT>
