Warrant To Purchase Common Stock Healthcare Iii

Warrant to Purchase 1,082,200 Shares of Common Stock or
such additional shares as this Warrant may entitle the holder
to purchase pursuant to provisions of this Warrant.


WARRANT TO PURCHASE COMMON STOCK


OF


3-DIMENSIONAL PHARMACEUTICALS, INC.


This is to Certify That, FOR VALUE RECEIVED, HealthCare Ventures III, L.P. or assigns ("Holder") is entitled to purchase, subject to the provisions of this Warrant, from 3-Dimensional Pharmaceuticals, Inc., a Delaware corporation (the "Company"), 1,082,200 fully paid, validly issued and nonassessable shares of Common Stock, par value $.001 per share, of the Company ("Common Stock") at a price of $1.25 per share during the Exercise Period (as defined below). The number of shares of Common Stock to be received upon the exercise of this Warrant and the price to be paid for each share of Common Stock may be adjusted from time to time as hereinafter set forth. The shares of Common Stock deliverable upon such exercise, and as adjusted from time to time, are hereinafter sometimes referred to as "Warrant Shares" and the exercise price of a share of Common Stock in effect at any time and as adjusted from time to time is hereinafter sometimes referred to as the "Exercise Price." This Warrant is being issued in connection with the issuance by the Company of Warrants to purchase shares of Common Stock and promissory notes in the aggregate principal amount of up to $10,000,000 (the "Notes"), pursuant to a Note and Warrant Purchase Agreement dated as of November 18, 1999 (the "Agreement").


1. EXERCISE OF WARRANT.


a. This Warrant may be exercised in whole or in part at
any time or from time to time on or after November 18,
1999 until 5 p.m. New York City Time on November 18,
2000 (the "Exercise Period"); provided, however, that
if such day is a day on which banking institutions in
the State of New York are authorized by law to close,
then on the next succeeding day which shall not be
such a day. This Warrant may be exercised by
presentation and surrender hereof to the Company at
its principal office, or at the office of its stock
transfer agent, if any, with the Purchase Form annexed
hereto duly executed and accompanied by payment of the
Exercise Price for the number of Warrant Shares
specified in such form. As soon as practicable after
each such exercise of the


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Warrants, but not later than seven (7) days from the
date of such exercise, the Company shall issue and
deliver to the Holder a certificate or certificates
for the Warrant Shares issuable upon such exercise,
registered in the name of the Holder or its designee.
If this Warrant should be exercised in part only, the
Company shall, upon surrender of this Warrant for
cancellation, execute and deliver a new Warrant
evidencing the rights of the Holder thereof to
purchase the balance of the Warrant Shares purchasable
thereunder. Upon receipt by the Company of this
Warrant at its office, or by the stock transfer agent
of the Company at its office, in proper form for
exercise, the Holder shall be deemed to be the holder
of record of the shares of Common Stock issuable upon
such exercise, notwithstanding that the stock transfer
books of the Company shall then be closed or that
certificates representing such shares of Common Stock
shall not then be physically delivered to the Holder.


b. At any time during the Exercise Period, the Holder
may, at its option, exchange this Warrant, in whole or in
part (a "Warrant Exchange") into the number of Warrant
Shares determined in accordance with this Section (a)(ii),
by surrendering this Warrant at the principal office of
the Company or at the office of its stock transfer agent,
accompanied by a notice stating such Holder's intent to
effect such exchange, the number of Warrant Shares to be
exchanged and the date on which the Holder requests that
such Warrant Exchange occur (the "Notice of Exchange").
The Warrant Exchange shall take place on the date
specified in the Notice of Exchange or, if later, the date
the Notice of Exchange is received by the Company (the
"Exchange Date"). Certificates for the shares issuable
upon such Warrant Exchange and, if applicable, a new
warrant of like tenor evidencing the balance of the shares
remaining subject to this Warrant, shall be issued as of
the Exchange Date and delivered to the Holder within seven
(7) days following the Exchange Date. In connection with
any Warrant Exchange, this Warrant shall represent the
right to subscribe for and acquire the number of Warrant
Shares (rounded to the next highest integer) equal to (i)
the number of Warrant Shares specified by the Holder in
its Notice of Exchange (the "Total Number") less (ii) the
number of Warrant Shares equal to the quotient obtained by
dividing (A) the product of the Total Number and the
existing Exercise Price by (B) the Fair Market Value.
"Fair Market Value" shall mean: (1) if the Common Stock is
listed on a National Securities Exchange or admitted to
unlisted trading privileges on such exchange or listed for
trading on the NASDAQ system, the average of the last
reported sale prices of the Common Stock on such exchange
or system for the twenty (20) business days ending on the
last business day prior to the date for which the
determination is being made; or (2) if the Common Stock is
not so listed or admitted to unlisted trading privileges,
the average of the means of the last reported bid and
asked prices reported


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by the National Quotation Bureau, Inc. for the twenty (20)
business days ending on the last business day prior to the
date for which the determination is being made; or (3) if
the Common Stock is not so listed or admitted to unlisted
trading privileges and bid and asked prices are not so
reported, an amount, not less than book value thereof as
at the end of the most recent fiscal year of the Company
ending prior to the Exchange Date, determined in such
reasonable manner as may be prescribed by the Board of
Directors of the Company.


2. RESERVATION OF SHARES. The Company shall at all times
reserve for issuance and/or delivery upon exercise of this Warrant
such number of shares of its Common Stock as shall be required for
issuance and delivery upon exercise of the Warrants.


3. FRACTIONAL SHARES. No fractional shares or script
representing fractional shares shall be issued upon the exercise of
this Warrant. With respect to any fraction of a share called for upon
any exercise hereof, the Company shall pay to the Holder an amount in
cash equal to such fraction multiplied by the Fair Market Value of a
share.


4. EXCHANGE, TRANSFER, ASSIGNMENT OR LOSS OF WARRANT.


(i) This Warrant is exchangeable, without expense, at
the option of the Holder, upon presentation and surrender
hereof to the Company or at the office of its stock
transfer agent, if any, for other warrants of different
denominations entitling the holder thereof to purchase in
the aggregate the same number of shares of Common Stock
purchasable hereunder. Subject to the restrictions set
forth in subparagraph (ii) below, upon surrender of this
Warrant to the Company at its principal office or at the
office of its stock transfer agent, if any, with the
Assignment Form annexed hereto duly executed and funds
sufficient to pay any transfer tax, the Company shall,
without charge, execute and deliver a new Warrant in the
name of the assignee named in such instrument of
assignment and this Warrant shall promptly be canceled.
This Warrant may be divided or combined with other
warrants which carry the same rights upon presentation
hereof at the principal office of the Company or at the
office of its stock transfer agent, if any, together with
a written notice specifying the names and denominations in
which new Warrants are to be issued and signed by the
Holder hereof. The term "Warrant" as used herein includes
any Warrants into which this Warrant may be divided or
exchanged. Upo ...