EXHIBIT 99.3
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
November __, 2002 (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 $_____, 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 NOVEMBER __, 2002, 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) Except as provided in Section 4 herein,
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 the surrender of this Warrant and
the Notice of Exercise Form annexed hereto duly executed, at the
office of the Company (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) and
upon payment of the Exercise Price of the shares thereby purchased by
wire transfer or cashier's check drawn on a United States bank [OR BY
MEANS OF A CASHLESS EXERCISE], the Holder shall be entitled to receive
a certificate for the number of Warrant Shares so purchased.
Certificates for shares purchased hereunder shall be delivered to the
Holder within three (3) Trading Days after the date on which this
Warrant shall have been exercised as aforesaid. This Warrant shall be
deemed to have been exercised and such certificate or certificates
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
third Trading Day after the date of exercise, 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 fifth Trading Day after the date of
exercise, and if after such fifth 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
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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 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
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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.][INCENTIVE WARRANTS ONLY]
[TO BE INCLUDED ONLY IN WARRANTS ISSUED PURSUANT TO
SECTIONS 2.2(A)II(D-E) OF THE PURCHASE AGREEMENT][(E) WITHIN 2 DAYS
AFTER THE END OF ANY PERIOD OF 10 CONSECUTIVE TRADING DAYS THAT THE
CLOSING BID PRICE HAS EXCEEDED $_____, THE COMPANY SHALL HAVE THE
RIGHT, UPON 15 DAYS ADVANCE WRITTEN NOTICE TO THE HOLDER, TO CAUSE THE
HOLDER TO EXERCISE THE UNEXERCISED PORTION OF THIS WARRANT.
NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN, THE COMPANY MAY ONLY
EXERCISE ITS RIGHTS HEREUNDER IF EACH OF THE FOLLOWING SHALL BE TRUE:
(I) THE COMPANY SHALL HAVE DULY HONORED ALL NOTICES OF EXERCISE TO
OCCUR OR OCCURRING PRIOR TO THE DATE OF THE REDEMPTION, (II) THERE IS
AN EFFECTIVE UNDERLYING SHARES REGISTRATION STATEMENT PURSUANT TO
WHICH THE HOLDER IS PERMITTED TO UTILIZE THE PROSPECTUS THEREUNDER TO
RESELL ALL OF THE WARRANT SHARES ISSUED TO THE HOLDER AND ALL OF THE
WARRANT SHARES AS ARE ISSUABLE TO THE HOLDER UPON EXERCISE IN FULL OF
THIS WARRANT (AND THE COMPANY BELIEVES, IN GOOD FAITH, THAT SUCH
EFFECTIVENESS WILL CONTINUE UNINTERRUPTED FOR THE FORESEEABLE FUTURE),
(III) THE COMMON STOCK IS LISTED FOR TRADING ON A PRINCIPAL MARKET
(AND THE COMPANY BELIEVES, IN GOOD FAITH, THAT TRADING OF THE COMMON
STOCK ON A PRINCIPAL MARKET WILL CONTINUE UNINTERRUPTED FOR THE
FORESEEABLE FUTURE), (IV) ALL LIQUIDATED DAMAGES AND OTHER AMOUNTS
OWING IN RESPECT OF THE WARRANT AND WARRANT SHARES SHALL HAVE BEEN
PAID OR WILL, CONCURRENTLY WITH THE ISSUANCE OF THE WARRANT SHARES, BE
PAID IN CASH; (V) THERE IS A SUFFICIENT NUMBER OF AUTHORIZED BUT
UNISSUED AND OTHERWISE UNRESERVED SHARES OF COMMON STOCK FOR THE
ISSUANCE OF ALL THE WARRANT SHARES AS ARE ISSUABLE TO THE HOLDER UPON
EXERCISE IN FULL OF THIS WARRANT; AND (VI) NO PUBLIC ANNOUNCEMENT OF A
PENDING OR PROPOSED EVENT SUBJECT SECTION 12 HAS OCCURRED THAT HAS NOT
BEEN CONSUMMATED. FURTHERMORE, SUBJECT TO THE TERMS AND CONDITIONS
HEREIN, THE HOLDER SHALL HAVE THE RIGHT TO EXERCISE THIS WARRANT AT
ANYTIME PRIOR TO THE DATE SUCH FORCED EXERCISE NOTICE IS DELIVERED OR
SUCH FORCED EXERCISE OCCURS.]
[TO BE INCLUDED ONLY IN WARRANTS ISSUED PURSUANT TO
SECTIONS 2.2(A)(II)(D-E) OF THE PURCHASE AGREEMENT][(E) SUBJECT
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TO SUBSECTION (F) BELOW, WITHIN 2 DAYS AFTER THE END OF ANY PERIOD OF
10 CONSECUTIVE TRADING DAYS THAT THE CLOSING BID PRICE HAS EXCEEDED
$_____, THE COMPANY SHALL HAVE THE RIGHT, UPON 15 DAYS ADVANCE WRITTEN
NOTICE TO THE HOLDER, TO CAUSE THE HOLDER TO EXERCISE THE UNEXERCISED
PORTION OF THIS WARRANT. NOTWITHSTANDING ANYTHING TO THE CONTRARY
HEREIN, THE COMPANY MAY ONLY EXERCISE ITS RIGHTS HEREUNDER IF EACH OF
THE FOLLOWING SHALL BE TRUE: (I) THE COMPANY SHALL HAVE DULY HONORED
ALL NOTICES OF EXERCISE TO OCCUR OR OCCURRING PRIOR TO THE DATE OF THE
REDEMPTION, (II) THERE IS AN EFFECTIVE UNDERLYING SHARES REGISTRATION
STATEMENT PURSUANT TO WHICH THE HOLDER IS PERMITTED TO UTILIZE THE
PROSPECTUS THEREUNDER TO RESELL ALL OF THE WARRANT SHARES ISSUED TO
THE HOLDER AND ALL OF THE WARRANT SHARES AS ARE ISSUABLE TO THE HOLDER
UPON EXERCISE IN FULL OF THIS WARRANT (AND THE COMPANY BELIEVES, IN
GOOD FAITH, THAT SUCH EFFECTIVENESS WILL CONTINUE UNINTERRUPTED FOR
THE FORESEEABLE FUTURE), (III) THE COMMON STOCK IS LISTED FOR TRADING
ON A PRINCIPAL MARKET (AND THE COMPANY BELIEVES, IN GOOD FAITH, THAT
TRADING OF THE COMMON STOCK ON A PRINCIPAL MARKET WILL CONTINUE
UNINTERRUPTED FOR THE FORESEEABLE FUTURE), (IV) ALL LIQUIDATED DAMAGES
AND OTHER AMOUNTS OWING IN RESPECT OF THE WARRANT AND WARRANT SHARES
SHALL HAVE BEEN PAID OR WILL, CONCURRENTLY WITH THE ISSUANCE OF THE
WARRANT SHARES, BE PAID IN CASH; (V) THERE IS A SUFFICIENT NUMBER OF
AUTHORIZED BUT UNISSUED AND OTHERWISE UNRESERVED SHARES OF COMMON
STOCK FOR THE ISSUANCE OF ALL THE WARRANT SHARES AS ARE ISSUABLE TO
THE HOLDER UPON EXERCISE IN FULL OF THIS WARRANT AND ALL OF THE
UNDERLYING SHARES ISSUABLE PURSUANT TO THE DEBENTURES AND WARRANTS
ISSUABLE PURSUANT TO SECTION 2.2(A)(II)(A-C) OF THE PURCHASE
AGREEMENT; AND (VI) NO PUBLIC ANNOUNCEMENT OF A PENDING OR PROPOSED
EVENT SUBJECT SECTION 12 HAS OCCURRED THAT HAS NOT BEEN CONSUMMATED.
FURTHERMORE, SUBJECT TO THE TERMS AND CONDITIONS HEREIN, THE HOLDER
SHALL HAVE THE RIGHT TO EXERCISE THIS WARRANT AT ANYTIME PRIOR TO THE
DATE SUCH FORCED EXERCISE NOTICE IS DELIVERED OR SUCH FORCED EXERCISE
OCCURS.]
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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. This
Warrant does not entitle the Holder to any voting rights or other rights as a
shareholder of the Company prior to the exercise hereof. Upon the surrender of
this Warrant and the payment of the aggregate Exercise Price (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.
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) [ONLY INCLUDED IN INCENTIVE WARRANTS]
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 A PRICE DETERMINED BY DIVIDING (I)
AN AMOUNT EQUAL TO THE SUM OF (A) THE TOTAL NUMBER OF SHARES
OF COMMON STOCK OUTSTANDING IMMEDIATELY PRIOR TO SUCH
ISSUANCE OR SALE MULTIPLIED BY THE EXERCISE PRICE THEN IN
EFFECT, PLUS (B) THE CONSIDERATION, IF ANY, RECEIVED BY THE
COMPANY UPON SUCH ISSUANCE OR SALE, BY (II) THE TOTAL NUMBER
OF SHARES OF COMMON STOCK OUTSTANDING IMMEDIATELY AFTER SUCH
ISSUANCE OR SALE, 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
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(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
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
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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.
(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
10
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), 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-Scholes 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
11
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, 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
12
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.
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
13
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 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.
********************
14
IN WITNESS WHEREOF, the Company has caused this Warrant to be
executed by its officer thereunto duly authorized.
Dated: November __, 2002
VIRAGEN, INC.
By:
----------------------------------------
Name:
Title:
15
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.
