EXHIBIT 10.60
NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS EXERCISABLE
HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE
SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO
SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS
SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER
LOAN SECURED BY SUCH SECURITIES
STOCK PURCHASE WARRANT
To Purchase __________ Shares of Common Stock of
VIRAGEN, INC.
THIS CERTIFIES that, for value received, __________ (the "Holder"), is
entitled, upon the terms and subject to the limitations on exercise and the
conditions hereinafter set forth, at any time on or after January __, 2003 (the
"Initial Exercise Date") and on or prior to the close of business on the third
anniversary of the Initial Exercise Date (the "Termination Date") but not
thereafter, to subscribe for and purchase from Viragen, Inc., a corporation
incorporated in the State of Delaware (the "Company"), up to ________ shares
(the "Warrant Shares") of Common Stock, par value $0.01 per share, of the
Company (the "Common Stock"). The purchase price of one share of Common Stock
(the "Exercise Price") under this Warrant shall be $0.0625, subject to
adjustment hereunder. The Exercise Price and the number of Warrant Shares for
which the Warrant is exercisable shall be subject to adjustment as provided
herein. CAPITALIZED TERMS USED AND NOT OTHERWISE DEFINED HEREIN SHALL HAVE THE
MEANINGS SET FORTH IN THAT CERTAIN SECURITIES PURCHASE AGREEMENT (THE "PURCHASE
AGREEMENT"), DATED JANUARY 23, 2003, BETWEEN THE COMPANY AND THE INVESTORS
SIGNATORY THERETO.
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1. Title to Warrant. Prior to the Termination Date and
subject to compliance with applicable laws, this Warrant and all rights
hereunder are transferable, in whole or in part, at the office or agency of the
Company by the Holder in person or by duly authorized attorney, upon surrender
of this Warrant together with the Assignment Form annexed hereto properly
endorsed.
2. Authorization of Shares. The Company covenants that
all Warrant Shares which may be issued upon the exercise of the purchase rights
represented by this Warrant will, upon exercise of the purchase rights
represented by this Warrant, be duly authorized, validly issued, fully paid and
nonassessable and free from all taxes, liens and charges in respect of the issue
thereof (other than taxes in respect of any transfer occurring contemporaneously
with such issue).
3. Exercise of Warrant.
(a) Exercise of the purchase rights
represented by this Warrant may be made at any time or times on or
after the Initial Exercise Date and on or before the Termination Date
by delivery to the Company of a duly executed facsimile copy of the
Notice of Exercise Form annexed hereto (or such other office or agency
of the Company as it may designate by notice in writing to the
registered Holder at the address of such Holder appearing on the books
of the Company); provided, however, within 5 Trading Days of the date
said Notice of Exercise is delivered to the Company, the Holder shall
have surrendered this Warrant to the Company and the Company shall have
received payment of the aggregate Exercise Price of the shares thereby
purchased by wire transfer or cashier's check drawn on a United States
bank. Certificates for shares purchased hereunder shall be delivered to
the Holder within the earlier of (i) 5 Trading Days after the date on
which the Notice of Exercise shall have been delivered by facsimile
copy or (ii) 3 Trading Days from the delivery to the Company of the
Notice of Exercise Form by facsimile copy, surrender of this Warrant
and payment of the aggregate Exercise Price as set forth above
("Warrant Share Delivery Date"); provided, however, in the event the
Warrant is not surrendered or the aggregate Exercise Price is not
received by the Company within 5 Trading Days after the date on which
the Notice of Exercise shall be delivered by facsimile copy, the
Warrant Share Delivery Date shall be extended to the extent such 5
Trading Day period is exceeded. This Warrant shall be deemed to have
been exercised on the date the Notice of Exercise is delivered to the
Company by facsimile copy. The Warrant Shares shall be deemed to have
been issued, and Holder or any other person so designated to be named
therein shall be deemed to have become a holder of record of such
shares for all purposes, as of the date the Warrant has been exercised
by payment to the Company of the Exercise Price and all taxes required
to be paid by the Holder, if any, pursuant to Section 5 prior to the
issuance of such shares, have been paid. If the Company fails to
deliver to the Holder a certificate or certificates representing the
Warrant Shares pursuant to this Section 3(a) by the Warrant Share
Delivery Date, then the Holder will have the right to rescind such
exercise. In addition to any other rights available to the Holder, if
the Company fails to deliver to the Holder a certificate or
certificates representing the Warrant Shares pursuant to an exercise by
the
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second Trading Day after the Warrant Share Delivery Date, and if after
such Trading Day the Holder purchases (in an open market transaction or
otherwise) shares of Common Stock to deliver in satisfaction of a sale
by the Holder of the Warrant Shares which the Holder anticipated
receiving upon such exercise (a "Buy-In"), then the Company shall (1)
pay in cash to the Holder the amount by which (x) the Holder's total
purchase price (including brokerage commissions, if any) for the shares
of Common Stock so purchased exceeds (y) the amount obtained by
multiplying (A) the number of Warrant Shares that the Company was
required to deliver to the Holder in connection with the exercise at
issue times (B) the closing bid price of the Common Stock at the time
of the obligation giving rise to such purchase obligation, and (2) at
the option of the Holder, either reinstate the portion of the Warrant
and equivalent number of Warrant Shares for which such exercise was not
honored or deliver to the Holder the number of shares of Common Stock
that would have been issued had the Company timely complied with its
exercise and delivery obligations hereunder. For example, if the Holder
purchases Common Stock having a total purchase price of $11,000 to
cover a Buy-In with respect to an attempted exercise of shares of
Common Stock with a market price on the date of exercise totaled
$10,000, under clause (1) of the immediately preceding sentence the
Company shall be required to pay the Holder $1,000. The Holder shall
provide the Company written notice indicating the amounts payable to
the Holder in respect of the Buy-In. Nothing herein shall limit a
Holder's right to pursue any other remedies available to it hereunder,
at law or in equity including, without limitation, a decree of specific
performance and/or injunctive relief with respect to the Company's
failure to timely deliver certificates representing shares of Common
Stock upon exercise of the Warrant as required pursuant to the terms
hereof.
(b) If this Warrant shall have been
exercised in part, the Company shall, at the time of delivery of the
certificate or certificates representing Warrant Shares, deliver to
Holder a new Warrant evidencing the rights of Holder to purchase the
unpurchased Warrant Shares called for by this Warrant, which new
Warrant shall in all other respects be identical with this Warrant.
(c) Notwithstanding anything herein to
the contrary, in no event shall the Holder be permitted to exercise
this Warrant for Warrant Shares to the extent that (i) the number of
shares of Common Stock owned by such Holder (other than Warrant Shares
issuable upon exercise of this Warrant) plus (ii) the number of Warrant
Shares issuable upon exercise of this Warrant, would be equal to or
exceed 4.9999% of the number of shares of Common Stock then issued and
outstanding, including shares issuable upon exercise of this Warrant
held by such Holder after application of this Section 3(c). As used
herein, beneficial ownership shall be determined in accordance with
Section 13(d) of the Exchange Act. To the extent that the limitation
contained in this Section 3(c) applies, the determination of whether
this Warrant is exercisable (in relation to other securities owned by
the Holder) and of which a portion of this Warrant is exercisable shall
be in the sole discretion of such Xxxxxx, and the submission of a
Notice of Exercise shall be deemed to be such Holder's determination of
whether this Warrant is exercisable (in relation to other securities
owned by such Holder) and of which portion of this Warrant is
exercisable, in each case subject to such aggregate percentage
limitation, and the Company shall have no obligation to verify or
confirm the accuracy of such
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determination. Nothing contained herein shall be deemed to restrict the
right of a Holder to exercise this Warrant into Warrant Shares at such
time as such exercise will not violate the provisions of this Section
3(c). The provisions of this Section 3(c) may be waived by the Holder
upon, at the election of the Holder, not less than 61 days' prior
notice to the Company, and the provisions of this Section 3(c) shall
continue to apply until such 61st day (or such later date, as
determined by the Holder, as may be specified in such notice of
waiver). No exercise of this Warrant in violation of this Section 3(c)
but otherwise in accordance with this Warrant shall affect the status
of the Warrant Shares as validly issued, fully-paid and nonassessable.
(d) If after one year if there is no
effective Registration Statement registering the Warrant Shares, this
Warrant may also be exercised by means of a "cashless exercise" in
which the Holder shall be entitled to receive a certificate for the
number of Warrant Shares equal to the quotient obtained by dividing
[(A-B) (X)] by (A), where:
(A) = the average of the high and low trading
prices per share of Common Stock on the
Trading Day preceding the date of such
election;
(B) = the Exercise Price of the Warrants; and
(X) = the number of Warrant Shares issuable upon
exercise of the Warrants in accordance with
the terms of this Warrant.
(e) Until the Company obtains
Shareholder Approval (as defined in Section 4.16 of the Purchase
Agreement), the Holder's right to exercise this Warrant shall be
limited to the extent such exercise causes the issuance to exceed such
Holder's (or its predecessor's) pro-rata portion of the Issuable
Maximum (as defined in Section 4(a)(iii) of the Debenture). The
Termination Date shall be extended for a number of Trading Days equal
to the number of days the exercise of this Warrant is prohibited
hereunder.
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4. No Fractional Shares or Scrip. No fractional shares
or scrip representing fractional shares shall be issued upon the exercise of
this Warrant. As to any fraction of a share which Holder would otherwise be
entitled to purchase upon such exercise, the Company shall pay a cash adjustment
in respect of such final fraction in an amount equal to such fraction multiplied
by the Exercise Price.
5. Charges, Taxes and Expenses. Issuance of certificates
for Warrant Shares shall be made without charge to the Holder for any issue or
transfer tax or other incidental expense in respect of 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 or in such name or
names as may be directed by the Holder; provided, however, that in the event
certificates for Warrant Shares are to be issued in a name other than the name
of the Holder, this Warrant when surrendered for exercise shall be accompanied
by the Assignment Form attached hereto duly executed by the Holder; and the
Company may require, as a condition thereto, the payment of a sum sufficient to
reimburse it for any transfer tax incidental thereto.
6. Closing of Books. The Company will not close its
stockholder books or records in any manner which prevents the timely exercise of
this Warrant.
7. Transfer, Division and Combination.
(a) Subject to compliance with any applicable
securities laws, transfer of this Warrant and all rights hereunder, in
whole or in part, shall be registered on the books of the Company to be
maintained for such purpose, upon surrender of this Warrant at the
principal office of the Company, together with a written assignment of
this Warrant substantially in the form attached hereto duly executed by
the Holder or its agent or attorney and funds sufficient to pay any
transfer taxes payable upon the making of such transfer. Upon such
surrender and, if required, such payment, the Company shall execute and
deliver a new Warrant or Warrants in the name of the assignee or
assignees and in the denomination or denominations specified in such
instrument of assignment, and shall issue to the assignor a new Warrant
evidencing the portion of this Warrant not so assigned, and this
Warrant shall promptly be cancelled. A Warrant, if properly assigned,
may be exercised by a new holder for the purchase of Warrant Shares
without having a new Warrant issued.
(b) This Warrant may be divided or combined with
other Warrants upon presentation hereof at the aforesaid office of the
Company, together with a written notice specifying the names and
denominations in which new Warrants are to be issued, signed by the
Holder or its agent or attorney. Subject to compliance with Section
7(a), as to any transfer which may be involved in such division or
combination, the Company shall execute and deliver a new Warrant or
Warrants in exchange for the Warrant or Warrants to be divided or
combined in accordance with such notice.
(c) The Company shall prepare, issue and deliver
at its own expense (other than transfer taxes) the new Warrant or
Warrants under this Section 7.
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(d) The Company agrees to maintain, at its
aforesaid office, books for the registration and the registration of
transfer of the Warrants.
8. No Rights as Shareholder until Exercise. Upon the
surrender of this Warrant and the payment of the aggregate Exercise Price (or by
means of a cashless exercise), the Warrant Shares so purchased shall be and be
deemed to be issued to such Holder as the record owner of such shares as of the
close of business on the later of the date of such surrender or payment. This
Warrant does not entitle the Holder to any voting rights or other rights as a
shareholder of the Company prior to such date.
9. Loss, Theft, Destruction or Mutilation of Warrant.
The Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant
or any stock certificate relating to the Warrant Shares, and in case of loss,
theft or destruction, of indemnity or security reasonably satisfactory to it
(which shall not include the posting of any bond), and upon surrender and
cancellation of such Warrant or stock certificate, if mutilated, the Company
will make and deliver a new Warrant or stock certificate of like tenor and dated
as of such cancellation, in lieu of such Warrant or stock certificate.
10. Saturdays, Sundays, Holidays, etc. 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, Sunday or a legal holiday, then
such action may be taken or such right may be exercised on the next succeeding
day not a Saturday, Sunday or legal holiday.
11. Adjustments of Exercise Price and Number of Warrant
Shares.
(a) Stock Splits, etc. The number and kind of
securities purchasable upon the exercise of this Warrant and the
Exercise Price shall be subject to adjustment from time to time upon
the happening of any of the following. In case the Company shall (i)
pay a dividend in shares of Common Stock or make a distribution in
shares of Common Stock to holders of its outstanding Common Stock, (ii)
subdivide its outstanding shares of Common Stock into a greater number
of shares, (iii) combine its outstanding shares of Common Stock into a
smaller number of shares of Common Stock, or (iv) issue any shares of
its capital stock in a reclassification of the Common Stock, then the
number of Warrant Shares purchasable upon exercise of this Warrant
immediately prior thereto shall be adjusted so that the Holder shall be
entitled to receive the kind and number of Warrant Shares or other
securities of the Company which it would have owned or have been
entitled to receive had such Warrant been exercised in advance thereof.
Upon each such adjustment of the kind and number of Warrant Shares or
other securities of the Company which are purchasable hereunder, the
Holder shall thereafter be entitled to purchase the number of Warrant
Shares or other securities resulting from such adjustment at an
Exercise Price per Warrant Share or other security obtained by
multiplying the Exercise Price in effect immediately prior to such
adjustment by the number of Warrant Shares purchasable pursuant hereto
immediately prior to such adjustment and dividing by the number of
Warrant Shares or other securities of the Company resulting from such
adjustment. An adjustment made pursuant to this paragraph shall become
effective immediately after the effective date of such event
retroactive to the record date, if any, for such event.
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(b) Anti-Dilution Provisions. During the
Exercise Period, the Exercise Price and the number of Warrant Shares
issuable hereunder and for which this Warrant is then exercisable
pursuant to Section 1 hereof shall be subject to adjustment from time
to time as provided in this Section 11(b). In the event that any
adjustment of the Exercise Price as required herein results in a
fraction of a cent, such Exercise Price shall be rounded up or down to
the nearest cent.
(i) Adjustment of Exercise Price. If and
whenever the Company issues or sells, or in accordance with
Section 8(b) hereof is deemed to have issued or sold, any
shares of Common Stock for a consideration per share of less
than the then the Exercise Price or for no consideration (such
lower price, the "Base Share Price" and such issuances
collectively, a "Dilutive Issuance"), then, the Exercise Price
shall be reduced to equal the Base Share Price, provided, that
for purposes hereof, all shares of Common Stock that are
issuable upon conversion, exercise or exchange of Capital
Share Equivalents shall be deemed outstanding immediately
after the issuance of such Common Stock. Such adjustment shall
be made whenever such shares of Common Stock or Capital Share
Equivalents are issued.
(ii) Effect on Exercise Price of Certain Events.
For purposes of determining the adjusted Exercise Price under
Section 11(b) hereof, the following will be applicable:
(A) Issuance of Rights or Options. If
the Company in any manner issues or grants any
warrants, rights or options, whether or not
immediately exercisable, to subscribe for or to
purchase Common Stock or other securities
exercisable, convertible into or exchangeable for
Common Stock ("Convertible Securities") (such
warrants, rights and options to purchase Common Stock
or Convertible Securities are hereinafter referred to
as "Options") and the price per share for which
Common Stock is issuable upon the exercise of such
Options is less than the Exercise Price ("Below Base
Price Options"), then the maximum total number of
shares of Common Stock issuable upon the exercise of
all such Below Base Price Options (assuming full
exercise, conversion or exchange of Convertible
Securities, if applicable) will, as of the date of
the issuance or grant of such Below Base Price
Options, be deemed to be outstanding and to have been
issued and sold by the Company for such price per
share. For purposes of the preceding sentence, the
"price per share for which Common Stock is issuable
upon the exercise of such Below Base Price Options"
is determined by dividing (i) the total amount, if
any, received or receivable by the Company as
consideration for the issuance or granting of all
such Below Base Price Options, plus the minimum
aggregate amount of additional consideration, if any,
payable to the Company upon the exercise of all such
Below Base Price Options, plus, in the case of
Convertible Securities issuable upon the exercise of
such Below Base Price Options, the minimum aggregate
amount of additional consideration payable upon the
exercise, conversion or exchange thereof at the time
such Convertible Securities first become exercisable,
convertible or
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exchangeable, by (ii) the maximum total number of
shares of Common Stock issuable upon the exercise of
all such Below Base Price Options (assuming full
conversion of Convertible Securities, if applicable).
No further adjustment to the Exercise Price will be
made upon the actual issuance of such Common Stock
upon the exercise of such Below Base Price Options or
upon the exercise, conversion or exchange of
Convertible Securities issuable upon exercise of such
Below Base Price Options.
(B) Issuance of Convertible Securities.
If the Company in any manner issues or sells any
Convertible Securities, whether or not immediately
convertible (other than where the same are issuable
upon the exercise of Options) and the price per share
for which Common Stock is issuable upon such
exercise, conversion or exchange is less than the
Exercise Price, then the maximum total number of
shares of Common Stock issuable upon the exercise,
conversion or exchange of all such Convertible
Securities will, as of the date of the issuance of
such Convertible Securities, be deemed to be
outstanding and to have been issued and sold by the
Company for such price per share. For the purposes of
the preceding sentence, the "price per share for
which Common Stock is issuable upon such exercise,
conversion or exchange" is determined by dividing (i)
the total amount, if any, received or receivable by
the Company as consideration for the issuance or sale
of all such Convertible Securities, plus the minimum
aggregate amount of additional consideration, if any,
payable to the Company upon the exercise, conversion
or exchange thereof at the time such Convertible
Securities first become exercisable, convertible or
exchangeable, by (ii) the maximum total number of
shares of Common Stock issuable upon the exercise,
conversion or exchange of all such Convertible
Securities. No further adjustment to the Exercise
Price will be made upon the actual issuance of such
Common Stock upon exercise, conversion or exchange of
such Convertible Securities.
(C) Change in Option Price or
Conversion Rate. If there is a change at any time in
(i) the amount of additional consideration payable to
the Company upon the exercise of any Options; (ii)
the amount of additional consideration, if any,
payable to the Company upon the exercise, conversion
or exchange of any Convertible Securities; or (iii)
the rate at which any Convertible Securities are
convertible into or exchangeable for Common Stock (in
each such case, other than under or by reason of
provisions designed to protect against dilution), the
Exercise Price in effect at the time of such change
will be readjusted to the Exercise Price which would
have been in effect at such time had such Options or
Convertible Securities still outstanding provided for
such changed additional consideration or changed
conversion rate, as the case may be, at the time
initially granted, issued or sold.
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(D) Calculation of Consideration
Received. If any Common Stock, Options or Convertible
Securities are issued, granted or sold for cash, the
consideration received therefor for purposes of this
Warrant will be the amount received by the Company
therefor, before deduction of reasonable commissions,
underwriting discounts or allowances or other
reasonable expenses paid or incurred by the Company
in connection with such issuance, grant or sale. In
case any Common Stock, Options or Convertible
Securities are issued or sold for a consideration
part or all of which shall be other than cash, the
amount of the consideration other than cash received
by the Company will be the fair market value of such
consideration, except where such consideration
consists of securities, in which case the amount of
consideration received by the Company will be the
Market Price thereof as of the date of receipt. In
case any Common Stock, Options or Convertible
Securities are issued in connection with any merger
or consolidation in which the Company is the
surviving corporation, the amount of consideration
therefor will be deemed to be the fair market value
of such portion of the net assets and business of the
non-surviving corporation as is attributable to such
Common Stock, Options or Convertible Securities, as
the case may be. The fair market value of any
consideration other than cash or securities will be
determined in good faith by an investment banker or
other appropriate expert of national reputation
selected by the Company and reasonably acceptable to
the holder hereof, with the costs of such appraisal
to be borne by the Company.
(E) Exceptions to Adjustment of
Exercise Price. No adjustment to the Exercise Price
will be made upon the grant or exercise of any
Convertible Securities which may hereafter be granted
or exercised under any employee benefit plan of the
Company now existing or to be implemented in the
future, so long as the issuance of such Convertible
Securities is approved by a majority of the
non-employee members of the Board of Directors of the
Company or a majority of the members of a committee
of non-employee directors established for such
purpose.
(iii) Minimum Adjustment of Exercise Price. No
adjustment of the Exercise Price shall be made in an amount of
less than 1% of the Exercise Price in effect at the time such
adjustment is otherwise required to be made, but any such
lesser adjustment shall be carried forward and shall be made
at the time and together with the next subsequent adjustment
which, together with any adjustments so carried forward, shall
amount to not less than 1% of such Exercise Price.
12. Reorganization, Reclassification, Merger,
Consolidation or Disposition of Assets. In case the Company shall reorganize its
capital, reclassify its capital stock, consolidate or merge with or into another
corporation (where the Company is not the surviving corporation or where there
is a change in or distribution with respect to the Common Stock of the Company),
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or sell, transfer or otherwise dispose of all or substantially all its property,
assets or business to another corporation and, pursuant to the terms of such
reorganization, reclassification, merger, consolidation or disposition of
assets, shares of common stock of the successor or acquiring corporation, or any
cash, shares of stock or other securities or property of any nature whatsoever
(including warrants or other subscription or purchase rights) in addition to or
in lieu of common stock of the successor or acquiring corporation ("Other
Property"), are to be received by or distributed to the holders of Common Stock
of the Company, then the Holder shall have the right thereafter to receive, at
their option, (a) upon exercise of this Warrant, the number of shares of Common
Stock of the successor or acquiring corporation or of the Company, if it is the
surviving corporation, and Other Property receivable upon or as a result of such
reorganization, reclassification, merger, consolidation or disposition of assets
by a Holder of the number of shares of Common Stock for which this Warrant is
exercisable immediately prior to such event, or (b) only if the Company is not
the surviving corporation and the Closing Bid Price immediately prior to such
event is less than 110% of the Exercise Price, cash equal to the value of this
Warrant as determined in accordance with the Black-Sholes option pricing formula
which amount shall in no event exceed 150% of the product of the Exercise Price
and the number of Warrant Shares issuable hereunder. In case of any such
reorganization, reclassification, merger, consolidation or disposition of
assets, the successor or acquiring corporation (if other than the Company) shall
expressly assume the due and punctual observance and performance of each and
every covenant and condition of this Warrant to be performed and observed by the
Company and all the obligations and liabilities hereunder, subject to such
modifications as may be deemed appropriate (as determined in good faith by
resolution of the Board of Directors of the Company) in order to provide for
adjustments of Warrant Shares for which this Warrant is exercisable which shall
be as nearly equivalent as practicable to the adjustments provided for in this
Section 12. For purposes of this Section 12, "common stock of the successor or
acquiring corporation" shall include stock of such corporation of any class
which is not preferred as to dividends or assets over any other class of stock
of such corporation and which is not subject to redemption and shall also
include any evidences of indebtedness, shares of stock or other securities which
are convertible into or exchangeable for any such stock, either immediately or
upon the arrival of a specified date or the happening of a specified event and
any warrants or other rights to subscribe for or purchase any such stock. The
foregoing provisions of this Section 12 shall similarly apply to successive
reorganizations, reclassifications, mergers, consolidations or disposition of
assets.
13. Voluntary Adjustment by the Company. The Company may
at any time during the term of this Warrant reduce the then current Exercise
Price to any amount and for any period of time deemed appropriate by the Board
of Directors of the Company.
14. Notice of Adjustment. Whenever the number of Warrant
Shares or number or kind of securities or other property purchasable upon the
exercise of this Warrant or the Exercise Price is adjusted, as herein provided,
the Company shall promptly mail by registered or certified mail, return receipt
requested, to the Holder notice of such adjustment or adjustments setting forth
the number of Warrant Shares (and other securities or property) purchasable upon
the exercise of this Warrant and the Exercise Price of such Warrant Shares (and
other securities or property) after such adjustment, setting forth a brief
statement of the facts requiring such adjustment and setting forth the
computation by which such adjustment was made. Such notice,
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in the absence of manifest error, shall be conclusive evidence of the
correctness of such adjustment.
15. Notice of Corporate Action. If at any time:
(a) the Company shall take a record of the
holders of its Common Stock for the purpose of entitling them to
receive a dividend or other distribution, or any right to subscribe for
or purchase any evidences of its indebtedness, any shares of stock of
any class or any other securities or property, or to receive any other
right, or
(b) there shall be any capital reorganization of
the Company, any reclassification or recapitalization of the capital
stock of the Company or any consolidation or merger of the Company
with, or any sale, transfer or other disposition of all or
substantially all the property, assets or business of the Company to,
another corporation or,
(c) there shall be a voluntary or involuntary
dissolution, liquidation or winding up of the Company;
then, in any one or more of such cases, the Company shall give to Holder (i) at
least 20 days' prior written notice of the date on which a record date shall be
selected for such dividend, distribution or right or for determining rights to
vote in respect of any such reorganization, reclassification, merger,
consolidation, sale, transfer, disposition, liquidation or winding up, and (ii)
in the case of any such reorganization, reclassification, merger, consolidation,
sale, transfer, disposition, dissolution, liquidation or winding up, at least 20
days' prior written notice of the date when the same shall take place. Such
notice in accordance with the foregoing clause also shall specify (i) the date
on which any such record is to be taken for the purpose of such dividend,
distribution or right, the date on which the holders of Common Stock shall be
entitled to any such dividend, distribution or right, and the amount and
character thereof, and (ii) the date on which any such reorganization,
reclassification, merger, consolidation, sale, transfer, disposition,
dissolution, liquidation or winding up is to take place and the time, if any
such time is to be fixed, as of which the holders of Common Stock shall be
entitled to exchange their Warrant Shares for securities or other property
deliverable upon such disposition, dissolution, liquidation or winding up. Each
such written notice shall be sufficiently given if addressed to Holder at the
last address of Xxxxxx appearing on the books of the Company and delivered in
accordance with Section 17(d).
16. Authorized Shares. The Company covenants that during
the period the Warrant is outstanding, it will reserve from its authorized and
unissued Common Stock a sufficient number of shares to provide for the issuance
of the Warrant Shares upon the exercise of any purchase rights under this
Warrant. The Company further covenants that its issuance of this Warrant shall
constitute full authority to its officers who are charged with the duty of
executing stock certificates to execute and issue the necessary certificates for
the Warrant Shares upon the exercise of the purchase rights under this Warrant.
The Company will take all such reasonable action as may be necessary to assure
that such Warrant Shares may be issued as provided herein without violation of
any applicable law or regulation, or of any requirements of the Principal Market
upon which the Common Stock may be listed.
11
The Company shall not by any action, including, without limitation,
amending its certificate of incorporation or through any reorganization,
transfer of assets, consolidation, merger, dissolution, issue or sale of
securities or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of this Warrant, but will at all times in
good faith assist in the carrying out of all such terms and in the taking of all
such actions as may be necessary or appropriate to protect the rights of Holder
against impairment. Without limiting the generality of the foregoing, the
Company will (a) not increase the par value of any Warrant Shares above the
amount payable therefor upon such exercise immediately prior to such increase in
par value, (b) take all such action as may be necessary or appropriate in order
that the Company may validly and legally issue fully paid and nonassessable
Warrant Shares upon the exercise of this Warrant, and (c) use commercially
reasonable efforts to obtain all such authorizations, exemptions or consents
from any public regulatory body having jurisdiction thereof as may be necessary
to enable the Company to perform its obligations under this Warrant.
Before taking any action which would result in an adjustment in the
number of Warrant Shares for which this Warrant is exercisable or in the
Exercise Price, the Company shall obtain all such authorizations or exemptions
thereof, or consents thereto, as may be necessary from any public regulatory
body or bodies having jurisdiction thereof.
17. Miscellaneous.
(a) Jurisdiction. This Warrant shall constitute
a contract under the laws of New York, without regard to its conflict
of law, principles or rules.
(b) Restrictions. The Holder acknowledges that
the Warrant Shares acquired upon the exercise of this Warrant, if not
registered, will have restrictions upon resale imposed by state and
federal securities laws.
(c) Nonwaiver and Expenses. No course of dealing
or any delay or failure to exercise any right hereunder on the part of
Holder shall operate as a waiver of such right or otherwise prejudice
Xxxxxx's rights, powers or remedies, notwithstanding all rights
hereunder terminate on the Termination Date. If the Company willfully
and knowingly fails to comply with any provision of this Warrant, which
results in any material damages to the Holder, the Company shall pay to
Holder such amounts as shall be sufficient to cover any costs and
expenses including, but not limited to, reasonable attorneys' fees,
including those of appellate proceedings, incurred by Holder in
collecting any amounts due pursuant hereto or in otherwise enforcing
any of its rights, powers or remedies hereunder.
(d) Notices. Any notice, request or other
document required or permitted to be given or delivered to the Holder
by the Company shall be delivered in accordance with the notice
provisions of the Purchase Agreement.
(e) Limitation of Liability. No provision
hereof, in the absence of affirmative action by Holder to purchase
Warrant Shares, and no enumeration herein of the rights or privileges
of Holder, shall give rise to any liability of Holder for the
12
purchase price of any Common Stock or as a stockholder of the Company,
whether such liability is asserted by the Company or by creditors of
the Company.
(f) Remedies. Holder, in addition to being
entitled to exercise all rights granted by law, including recovery of
damages, will be entitled to specific performance of its rights under
this Warrant. The Company agrees that monetary damages would not be
adequate compensation for any loss incurred by reason of a breach by it
of the provisions of this Warrant and hereby agrees to waive the
defense in any action for specific performance that a remedy at law
would be adequate.
(g) Successors and Assigns. Subject to
applicable securities laws, this Warrant and the rights and obligations
evidenced hereby shall inure to the benefit of and be binding upon the
successors of the Company and the successors and permitted assigns of
Holder. The provisions of this Warrant are intended to be for the
benefit of all Holders from time to time of this Warrant and shall be
enforceable by any such Holder or holder of Warrant Shares.
(h) Amendment. This Warrant may be modified or
amended or the provisions hereof waived with the written consent of the
Company and the Holder.
(i) Severability. Wherever possible, each
provision of this Warrant shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this
Warrant shall be prohibited by or invalid under applicable law, such
provision shall be ineffective to the extent of such prohibition or
invalidity, without invalidating the remainder of such provisions or
the remaining provisions of this Warrant.
(j) Headings. The headings used in this Warrant
are for the convenience of reference only and shall not, for any
purpose, be deemed a part of this Warrant.
********************
13
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed
by its officer thereunto duly authorized.
Dated: January __, 2003
VIRAGEN, INC.
By:
-------------------------
Name:
Title:
14
NOTICE OF EXERCISE
To: Viragen, Inc.
(1) The undersigned hereby elects to purchase ________ Warrant
Shares (the "Common Stock"), of Viragen, Inc., 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.
(2) Please issue a certificate or certificates representing said
Warrant Shares in the name of the undersigned or in such other name as is
specified below:
------------------------------------
The Warrant Shares shall be delivered to the following:
-------------------------------------
-------------------------------------
-------------------------------------
[PURCHASER]
By:
--------------------------
Name:
Title:
Dated:
-----------------------
ASSIGNMENT FORM
(To assign the foregoing warrant, execute
this form and supply required information.
Do not use this form to exercise the warrant.)
FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced
thereby are hereby assigned to
_______________________________________________ whose address is
________________________________________________________________
________________________________________________________________
Dated: ______________, _______
Holder's Signature:
------------------------
Holder's Address: ------------------------
------------------------
Signature Guaranteed:
-----------------------------------------
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 whatsoever, and must be guaranteed by a bank or trust company. Officers
of corporations and those acting in a fiduciary or other representative capacity
should file proper evidence of authority to assign the foregoing Warrant.
NOTICE OF EXERCISE OF COMMON STOCK WARRANT
PURSUANT TO CASHLESS EXERCISE PROVISIONS
To: Viragen, Inc.
Aggregate Price of Warrant Before Exercise: $_______
Aggregate Price Being Exercised: $______
Exercise Price: $______ per share
Number of Shares of Common Stock to be Issued Under this Notice: ________
Remaining Aggregate Price (if any) After Issuance: $_______
Gentlemen:
The undersigned, registered Holder of the Warrant delivered herewith,
hereby irrevocably exercises such Warrant for, and purchases thereunder, shares
of the Common Stock of Viragen, Inc., as provided below. Capitalized terms used
herein, unless otherwise defined herein, shall have the meanings given in the
Warrant. The portion of the Exercise Price (as defined in the Warrant) to be
applied toward the purchase of Common Stock pursuant to this Notice of Exercise
is $_______, thereby leaving a remaining Exercise Price (if any) equal to
$________. Such exercise shall be pursuant to the cashless exercise provisions
of Section 3 of the Warrant; therefore, Holder makes no payment with this Notice
of Exercise. The number of shares to be issued pursuant to this exercise shall
be determined by reference to the formula in Section 3 of the Warrant which, by
reference to Section 3, requires the use of the high and low trading price of
the Company's Common Stock on the Trading Day preceding the date of such
election. The high and low trading price of the Company's Common Stock has been
determined by Holder to be $______ and $_________, respectively, which figure is
acceptable to Holder for calculations of the number of shares of Common Stock
issuable pursuant to this Notice of Exercise. Holder requests that the
certificates for the purchased shares of Common Stock be issued in the name of
_________________________ and delivered to ____________________________________.
To the extent the foregoing exercise is for less than the full Aggregate Price
of the Warrant, a replacement Warrant representing the remainder of the
Aggregate Price (and otherwise of like form, tenor and effect) shall be
delivered to Holder along with the share certificate evidencing the Common Stock
issued in response to this Notice of Exercise.
[Purchaser]
By:
----------------------------------
Name:
Title:
Date:
NOTE
The execution to the foregoing Notice of Exercise must exactly
correspond to the name of the Holder on the Warrant.
