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EXHIBIT 10.52
PURCHASE AGREEMENT
November 8, 2000
AGREEMENT dated as of the 8th day of November, 2000 by and between
ADVANCED VIRAL RESEARCH CORP., a Delaware corporation (the "Company"), with
offices at 000 Xxxxxxxxx Xxxxxxxxx Xxxxx, Xxxxxxx, Xxx Xxxx 00000 and each of
those persons, severally and not jointly, listed as a purchaser on the Schedule
of purchasers attached as EXHIBIT B hereto. Such persons are hereafter
collectively referred to as the "Purchasers" and each individually as a
"Purchaser".
ARTICLE I
AUTHORIZATION OF THE SECURITIES
The Company represents that it has taken all corporate action necessary
to authorize the issuance and sale of up to (a) 50,000,000 shares of Common
Stock of the Company, par value $.00001 per share ("Common Stock") and (b)
warrants to purchase up to an aggregate of 30,000,000 shares of Common Stock of
the Company (the "Warrants"). The Common Stock and the Warrants (collectively,
the "Securities") are to be sold to each Purchaser pursuant to this Agreement.
For purposes of this Agreement the term "Shares" shall mean the shares of Common
Stock purchased hereunder and the shares of Common Stock which may be issued
from time to time pursuant to the exercise of the Warrants.
ARTICLE II
SALE AND PURCHASE OF THE SECURITIES; CLOSING
II.1. SALE AND PURCHASE OF THE SECURITIES. Subject to the terms and
conditions hereof and in reliance on the representations and warranties
contained herein, or made pursuant hereto, the Company will issue and sell to
each Purchaser, severally and not jointly, as more particularly referred to
below, and each Purchaser will purchase from the Company, on any Closing Date
specified in Section 2.2, the Securities for the purchase price set forth next
to the name of such Purchaser on Exhibit B, at an aggregate purchase price for
all Purchasers of $5,000,000 (the "Aggregate Purchase Price"). Additional
Purchasers may be added to Exhibit B and/or the amount of Securities purchased
by any one or more Purchasers set forth on Exhibit B may be increased between
the date hereof and the Last Closing Date, as defined in Section 2.2, and in
such event the Aggregate Purchase Price shall be deemed to be the aggregate
purchase price paid by all Purchasers purchasing Securities as of the Last
Closing Date; provided that the Aggregate Purchase Price shall not exceed
$20,000,000.
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II.2. CLOSING.
(a) The closing of the purchase and sale of the Securities shall take
place at one or more closings (each, a "Closing"). A closing shall be deemed to
occur when this Agreement has been executed by both the Company and the
Purchasers and the Company has received payment for and issued all of the
Securities. The initial Closing will take place at such time and place or later
date as may be mutually agreed upon by the Company and the Purchasers
participating in the initial Closing, and shall be for an aggregate purchase
price of not less than $5,000,000. The date of any subsequent Closing or
Closings will be mutually agreed upon by the Company and a majority in interest
of the Purchasers participating in each such subsequent Closing, provided that
no Closing shall occur later than December 31, 2000 (the "Last Closing Date").
The date of any Closing is referred to as a "Closing Date." The date on which
this occurs is herein called the "Closing Date."
(b) On the Closing Date there will be delivered to each Purchaser (i)
the shares of Common stock indicated on Exhibit B registered in its name and
(ii) warrant certificates in the forms of Exhibits A-1 and A-2 registered in
such name representing the right to purchase the number of shares of Common
Stock set forth therein. The foregoing Securities shall be delivered by the
Company, against delivery by each Purchaser to the Company of an unendorsed
certified or official bank check drawn upon or issued by a bank which is a
member of the New York Clearinghouse for banks (or wire transfer) for the
aggregate purchase price to be paid by such Purchaser payable to the order of
the Company.
ARTICLE III
PURCHASERS' REPRESENTATIONS AND WARRANTIES
Each Purchaser represents and warrants to and covenants with the
Company that:
III.1. QUALIFIED BUYER. Purchaser is an "accredited investor" within
the meaning of Rule 501 of Regulation D promulgated under the Securities Act of
1933, as amended (the "Securities Act"). Either alone or together with the
advice of a representative, Purchaser is sophisticated and experienced in
making, and is qualified to make, decisions with respect to investments in
securities presenting an investment decision like that involved in the purchase
of the Securities, including investments in securities issued by the Company.
Purchaser has requested, received, reviewed and considered, either alone or with
a representative, all information Purchaser deems relevant in making an informed
decision to purchase the Securities, it being understood that such review will
not affect the validity of the representations of the Company in Article IV
hereof.
III.2. COMPLIANCE WITH LAWS. Purchaser will not, directly or
indirectly, offer, sell, pledge, transfer or otherwise dispose of (or solicit
any offers to buy, purchase or otherwise acquire or take a pledge of) any of the
Securities purchased hereunder except in compliance with the Securities Act,
applicable blue sky laws, and the rules and regulations promulgated thereunder.
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III.3. QUALIFIED INVESTOR QUESTIONNAIRE. Purchaser has completed or
caused to be completed the Purchaser Questionnaire attached hereto as Appendix
I. The answers thereto are true and correct as of the date hereof and will be
true and correct as of the Closing (provided that Purchaser shall be entitled to
update such information by providing notice thereof to the Company prior to the
Closing).
III.4. CAPACITY TO ENTER INTO AGREEMENT. Purchaser has full right,
power, authority and capacity to enter into this Agreement and to consummate the
transactions contemplated hereby. Upon the execution and delivery of this
Agreement by Purchaser, this Agreement shall constitute a valid and binding
obligation, enforceable in accordance with its terms, except (a) as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' and contracting
parties' rights generally, and (b) as limited by equitable principles generally.
III.5. OWNERSHIP IN THE COMPANY. Upon completion of the transaction or
upon exercise of any Warrant, Purchaser will not directly or beneficially own
more than 4.9% of the Common Stock of the Company.
III.6. INDEPENDENT INVESTIGATION. In electing to purchase the
Securities hereunder, Purchaser has relied solely upon the representations and
warranties of the Company set forth in this Agreement and on independent
investigation made by Purchaser and his representatives, if any, and Purchaser
has not been given any oral or written representations or assurance from the
Company or any representative of the Company other than as set forth in this
Agreement or in a document executed by a duly authorized representative of the
Company making reference to this Agreement.
III.7. NO GOVERNMENT RECOMMENDATION OR APPROVAL. Purchaser understands
that no United States federal or state agency, or similar agency of any other
country, has passed upon or made any recommendation or endorsement of the
Company, this transaction or the purchase of the Securities.
III.8. FURTHER LIMITATIONS ON DISPOSITION. Without in any way limiting
the representations set forth above, Purchaser agrees not to make any
disposition of all or any portion of the Warrants or the Shares issuable upon
the exercise of the Warrants unless and until (a) there is then in effect a
registration statement under the Securities Act covering such proposed
disposition and such disposition is made in accordance with such registration
statement, or (b) the disposition is made pursuant to an available exemption
from the registration requirements of the Securities Act and in the case of
clause (b) Purchaser shall have furnished the Company with such information as
the Company may reasonably require (including, if reasonably requested an
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opinion of counsel, reasonably satisfactory to the Company), to confirm that
such disposition will not violate any of the securities laws of the United
States.
III.9. LEGAL REPRESENTATION. Purchaser has had the opportunity to be
represented in this transaction by counsel of his own choice and has been so
advised by counsel for the Company.
III.10. SEPARATE PURCHASERS. Each Purchaser is a separate investor; no
Purchaser is acting in concert with any other Purchaser or any other person in
connection with the purchase of Securities pursuant to this Agreement.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants as follows:
IV.1. ORGANIZATION AND EXISTENCE, ETC. The Company is a corporation
duly organized and validly existing and in good standing under the laws of its
jurisdiction of incorporation, and has all requisite corporate power and
authority to carry on its business as now conducted and proposed to be
conducted; the Company has all requisite corporate power and authority to enter
into this Agreement, to issue the Securities as contemplated herein and the
Shares issuable upon exercise of the Warrants and to carry out and perform its
obligations under the terms and conditions of this Agreement. The Company does
not own or lease any property or engage in any activity in any jurisdiction
which might require qualification to do business as a foreign corporation in
such jurisdiction and where the failure to so qualify would have a material
adverse effect on the financial condition of the Company or subject the Company
to a material liability. To the extent the Company has not qualified to do
business in such jurisdictions, it has, as of the date hereof, prepared the
necessary applications or documents to be filed with the appropriate authorities
in such jurisdictions to obtain such qualifications.
IV.2. AUTHORIZATION. All corporate action on the part of the Company
and the directors and stockholders of the Company necessary for the
authorization, execution, delivery and performance by the Company of this
Agreement and the transactions contemplated herein, and for the authorization,
issuance and delivery of the Securities and the Shares issuable upon exercise of
the Warrants, has been taken or will have been taken prior to the Closing. The
Shares, when issued and sold in accordance with the terms hereof, will be
validly issued, fully paid and non-assessable.
IV.3. BINDING OBLIGATIONS; NO MATERIAL ADVERSE CONTRACTS, ETC. This
Agreement is a valid and binding obligation of the Company enforceable in
accordance with its terms. The execution, delivery and performance by the
Company of this Agreement and compliance herewith will not result in any
violation of and will not conflict with, or result in a breach of any of the
terms of, or constitute a default under, any provision of state or Federal law
to which the Company is subject, the Certificate of Incorporation, as amended,
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or the By-laws, as amended, of the Company, or any mortgage, indenture,
agreement, instrument, judgment, decree, order, rule or regulation or other
restriction to which the Company is a party or by which it is bound, or, result
in the creation of any mortgage, pledge, lien, encumbrance or charge upon any of
the properties or assets of the Company pursuant to any such term. Except as set
forth herein, or as waived by such stockholder, no stockholder of the Company
has or will have any preemptive rights or rights of first refusal by reason of
the issuance of the Securities.
IV.4. OFFERING. Subject in part to the truth and accuracy of the
representations made by each Purchaser herein and such Purchaser's compliance
with his covenants set forth in this Agreement, the offer, sale and issuance of
the Warrants and the Shares issuable upon exercise of the Warrants, in each case
as contemplated by this Agreement, are not subject to the registration
requirements of the Securities Act, and the Company, or anyone acting on its
behalf, will not take any action hereafter that would cause such registration
requirements to be applicable.
IV.5. SEC REPORTS. (a) The Company has filed with the Securities and
Exchange Commission (the "Commission") all reports ("SEC Reports") required to
be filed by it under the Securities Act of 1934, as amended (the "Exchange
Act"). All of the SEC Reports filed by the Company comply in all material
respects with the requirements of the Exchange Act. None of the SEC Reports
contains as of the respective dates thereof, any untrue statement of a material
fact or omits to state any material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances under which they were made. All financial statements contained in
the SEC Reports have been prepared in accordance with generally accepted
accounting principles consistently applied throughout the period indicated
("GAAP"). Each balance sheet presents fairly in accordance with GAAP the
financial position of the Company as of the date of such balance sheet, and each
statement of operations, of stockholders' equity and of cash flows presents
fairly in accordance with GAAP the results of operations, the stockholders'
equity and the cash flows of the Company for the periods then ended.
(b) No event has occurred since December 31, 1999 requiring the filing
of an SEC Report that has not heretofore been filed.
(c) The SEC Reports and this Agreement taken together as a whole will
not, as of the Closing Date, contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein, or necessary to
make the statements contained therein, in light of the circumstances under which
they were made, not misleading.
IV.6. DISCLOSURE. The information heretofore provided and to be
provided pursuant to this Agreement, and each of the agreements, documents,
certificates and writings previously delivered to Purchaser or his
representatives, do not and will not contain any untrue statement of material
fact and do not and will not omit to state a material fact required to be stated
herein or therein or necessary in order to make the statements and writings
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contained herein and therein not false or misleading in light of the
circumstances under which they were made. To the knowledge of the Company, there
is no fact which materially adversely affects the business, prospects or
condition (financial or otherwise) of the Company which has not been set forth
herein.
ARTICLE V
CONDITIONS TO PURCHASERS CLOSING
Each Purchaser's obligation to purchase the Securities at the Closing
is subject to the fulfillment to such Purchaser's satisfaction on or prior to
the Closing Date of each of the following conditions, any of which may be waived
by such Purchaser:
V.1. REPRESENTATIONS AND WARRANTIES CORRECT. The representations and
warranties in Article IV hereof shall be true and correct in all material
respects when made, and shall be true and correct in all material respects on
the Closing Date with the same force and effect as if they had been made on and
as of the Closing Date.
V.2. PERFORMANCE. All covenants, agreements and conditions contained in
this Agreement to be performed or complied with by the Company on or prior to
the Closing Date shall have been performed or complied with by the Company in
all material respects.
V.3. NO IMPEDIMENTS. Neither Purchaser nor the Company shall be subject
to any order, decree or injunction of a court or administrative agency of
competent jurisdiction which would impose any material limitation on Purchaser's
ability to exercise full rights of ownership of the Securities.
V.4. OTHER AGREEMENTS. The Company shall have issued to Purchaser all
of the Securities.
V.5. LEGAL INVESTMENT. At the time of the Closing, the purchase of the
Securities to be purchased hereunder shall be legally permitted by all laws and
regulations to which Purchaser and the Company are subject.
V.6. PROCEEDINGS AND OTHER DOCUMENTS. All corporate and other
proceedings in connection with the transactions contemplated by this Agreement
shall have been taken and Purchaser shall have received such other documents, in
form and substance reasonably satisfactory to Purchaser, as to such other
matters incident to the transaction contemplated hereby as Purchaser may
reasonably request.
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ARTICLE VI
CONDITIONS TO CLOSING OF THE COMPANY
The Company's obligation to sell the Securities at the Closing is
subject to the fulfillment to its satisfaction on or prior to the Closing Date
of each of the following conditions:
VI.1. REPRESENTATIONS. The representations made by each Purchaser in
Article III hereof shall be true and correct when made and shall be true and
correct on the Closing Date.
VI.2. LEGAL INVESTMENT. At the time of the Closing, the offer, sale and
purchase of the Securities shall be legally permitted by all laws and
regulations to which the Purchasers and the Company are subject.
VI.3. PAYMENT OF PURCHASE PRICE. The Company shall have received
payment in full of the Aggregate Purchase Price.
ARTICLE VII
AFFIRMATIVE COVENANTS AND INDEMNITY
The Purchasers and the Company hereby covenant and agree as follows:
VII.1. FURTHER ASSURANCES. From time to time the Company shall execute
and deliver to each Purchaser and each Purchaser shall execute and deliver to
the Company such other instruments, certificates, agreements and documents and
take such other action and do all other things as may be reasonably requested by
the other party in order to implement or effectuate the terms and provisions of
this Agreement and any of the Securities.
VII.2. REGISTRATION RIGHTS.
(a) The Company shall use its best efforts to file on or before the
date which is 60 days after the Company is given written notice by counsel for
the Purchasers that no additional persons shall make purchases of the Securities
under this Agreement (the "Deadline"), a registration statement (the
"Registration Statement") with the Commission, on such form as the Company deems
to be appropriate, to register under the Securities Act for resale by the
holders thereof the Shares which may be acquired upon exercise of the Warrants.
The Company shall thereafter use its best efforts to cause the Registration
Statement to be declared effective by the Commission. If for any reason (other
than the failure of one or more Purchasers to provide the information requested
pursuant to Section 7.2(b) in which event the filing deadline shall be extended
by one day for each day beyond the 10th day after written request therefor
during which the information is not provided) the Registration Statement is not
filed on or before the Deadline, then, subject to the next sentence, the Company
shall pay to the Purchasers (PRO RATA based on the Shares being acquired by
each) liquidated damages in an amount equal to .025% of the Aggregate Purchase
Price per business day until the Registration Statement is filed, it being
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agreed that this amount represents the parties' best estimate of the actual
damages to the purchasers. The maximum aggregate amount of liquidated damages
that the Company shall be required to pay to the Purchasers under this Section
7.2(b) shall be 2% of the Aggregate Purchase Price.
(b) Each Purchaser shall furnish to the Company such information as the
Company shall reasonably request in writing and as shall be required in
connection with the registration.
VII.3. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold each Purchaser harmless
from and against any losses, claims, damages or liabilities to which such
Purchaser may become subject (under the Securities Act or otherwise) insofar as
such losses, claims, damages or liabilities (or actions or proceedings in
respect thereof) arise out of, or are based upon, any Untrue Statement (as
defined below) on or after the effective date of the Registration Statement, or
arise out of any failure by the Company to fulfill any undertaking included in
the Registration Statement, and the Company will reimburse such Purchaser any
reasonable legal or other expenses reasonably incurred in investigating,
defending or preparing to defend any such action, proceeding or claim; PROVIDED,
HOWEVER, that the Company shall not be liable in any such case to the extent
that such loss, claim, damage or liability arises out of, or is based upon, an
Untrue Statement made in such Registration Statement in reliance upon and in
conformity with written information furnished to the Company by such Purchaser
or on such Purchaser's behalf, specifically for use in preparation of the
Registration Statement, or any statement or omission in any prospectus that is
corrected in any subsequent prospectus that was delivered prior to the pertinent
sale or sales by such Purchaser of his Shares.
(b) Each Purchaser agrees to indemnify and hold harmless the Company
and each person, if any, who controls the Company within the meeting of Section
15 of the Securities Act, each officer of the Company who signs the Registration
Statement and each director of the Company from and against any losses, claims,
damages or liabilities to which the Company or any such officer, director or
controlling person may become subject (under the Securities Act or otherwise),
including, but not limited to, any legal or other expenses reasonably incurred
in investigating, defending or preparing to defend any such action, proceeding
or claim, insofar as such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) arise out of, or are based upon, any failure to
comply with such Purchaser's representation and warranties hereunder, or any
Untrue Statement contained in the Registration Statement on or after the
effective date thereof if such Untrue Statement was made in reliance upon and in
conformity with written information furnished by such Purchaser or on such
Purchaser's behalf specifically for use in preparation of the Registration
Statement; PROVIDED, HOWEVER, that in no event shall such Purchaser's indemnity
exceed the gross proceeds received by Purchaser from the sale of Shares covered
by such Registration Statement.
(c) Promptly after receipt by any indemnified person of a notice of a
claim or the beginning of any action in respect of which indemnity is to be
sought against an indemnifying person pursuant to this section, such indemnified
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person shall notify the indemnifying person in writing of such claim or of the
commencement of such action, and, subject to the provisions hereinafter stated,
in case any such action shall be brought against an indemnified person and such
indemnifying person shall have been notified thereof, such indemnifying person
shall be entitled to participate therein, and, to the extent it shall wish, to
assume the defense thereof, with counsel reasonably satisfactory to such
indemnified person. After notice from the indemnifying person to such
indemnified person of its election to assume the defense thereof, such
indemnifying person shall not be liable to such indemnified person for any legal
expenses subsequently incurred by such indemnified person in connection with the
defense thereof; PROVIDED, HOWEVER, that if there exists or shall exist a
conflict of interest that would make it inappropriate, in the opinion of counsel
to the indemnified person, for the same counsel to represent both the
indemnified person and such indemnifying person or any affiliate or associate
thereof, the indemnified person shall be entitled to retain its own counsel at
the expense of such indemnifying person; PROVIDED FURTHER, however, that no
indemnifying person shall be responsible for the fees and expenses of more than
one separate counsel for all indemnified parties.
(d) "Untrue Statement" means any untrue statement or alleged untrue
statement, or any omission or alleged omission to state in the Registration
Statement a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
ARTICLE VIII
COMPLIANCE WITH THE SECURITIES ACT
VIII.1. LEGENDS. The certificate(s)representing the Warrants delivered
to the Purchasers at Closing (and the Shares issued upon exercise of the
Warrants) shall be stamped or otherwise imprinted with a legend substantially
similar the following (in addition to any other legend required under applicable
state securities laws):
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 (THE "ACT") AND MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER
THE ACT OR, IN THE OPINION OF COUNSEL OR BASED ON OTHER WRITTEN EVIDENCE IN THE
FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER,
SALE OR TRANSFER, PLEDGE, OR HYPOTHECATION IS IN COMPLIANCE THEREWITH.
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ARTICLE IX
MISCELLANEOUS
IX.1. GOVERNING LAW. This Agreement and the rights of the parties
hereunder shall be governed in all respects by the laws of the State of New
York.
IX.2. SURVIVAL. The representations, warranties, covenants and
agreements made herein shall survive the Closing, for a period of one year from
the date of Closing.
IX.3. SUCCESSORS AND ASSIGNS. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding upon
and enforceable by and against, the successors, assigns, heirs, executors and
administrators of the parties hereto; PROVIDED, HOWEVER, that the Company may
not assign its rights hereunder.
IX.4. ENTIRE AGREEMENT. This Agreement (including the Exhibits hereto)
and the other documents delivered pursuant hereto and simultaneously herewith
constitute the full and entire understanding and agreement between the parties
with regard to the subject matter hereof and thereof.
IX.5. AMENDMENT. This Agreement may not be amended, discharged or
terminated without the written consent of each Purchaser and that of the
Company.
IX.6. NOTICES, ETC. All notices, demands or other communications given
hereunder shall be in writing and shall be sufficiently given if delivered
either personally or by a nationally recognized courier service marked for next
business day delivery or sent in a sealed envelope by first class mail, postage
prepaid and either registered or certified, addressed as follows:
if to the Company:
Advanced Viral Research Corp.
000 Xxxxxxxxx Xxxxxxxxx Xxxxx
Xxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxxxx, M.D.
President and Chief Executive Officer
(a) if to Purchaser, to the address set forth on Exhibit B to this
Agreement
or to such other address with respect to any party hereto as such party may from
time to time notify (as provided above) the other parties hereto. Any such
notice, demand or communication shall be deemed to have been given (i) on the
date of delivery, if delivered personally, (ii) one business day after delivery
to a nationally recognized overnight courier service, if marked for next day
delivery or (iii) five business days after the date of mailing, if mailed.
Copies of any notice, demand or communication given to the Company
shall be delivered to Wolf, Block, Xxxxxx and Xxxxx-Xxxxx LLP, 000 Xxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx, 00000, Attn.: Xxxxxx X. Xxxxxxx, Esq., or such other address
as may be directed.
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IX.7. DELAYS OR OMISSIONS. No delay or omission to exercise any right,
power or remedy accruing to any holder of any Securities upon any breach or
default of the Company under this Agreement shall impair any such right, power
or remedy of such holder nor shall it be construed to be a waiver of any such
breach or default, or an acquiescence, therein, or of or in any similar breach
or default thereafter occurring; nor shall any waiver of any single breach or
default be deemed a waiver of any other breach or default theretofore or
thereafter occurring. Any waiver, permit, consent or approval of any kind or
character on the part of any holder of any breach or default under this
Agreement, or any waiver on the part of any holder of any provisions or
conditions of this Agreement must be made in writing and shall be effective only
to the extent specifically set forth in such writing. Except as otherwise
provided herein, all remedies, either under this Agreement or by law or
otherwise afforded to any holder, shall be cumulative and not alternative.
IX.8. SEVERABILITY. In case any provision of this Agreement shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
IX.9. PLACEMENT FEE. Each Purchaser hereby represents and warrants to
the Company that he has not retained a finder or broker in connection with the
transactions contemplated by this Agreement. The Company agrees to indemnify and
to hold each Purchaser harmless of and from any liability for commission or
compensation in the nature of an agent's or broker's fee to any broker, person
or firm claiming to have been retained by Company to act as a finder or broker
in connection with this transaction and the costs and expenses of defending
against such liability or asserted liability. Each Purchaser agrees to indemnify
and to hold the Company harmless of and from any liability for commission or
compensation in the nature of an agent's or broker's fee to any broker, person
or firm claiming to have been retained by or on behalf of such Purchaser to act
as a finder or broker in connection with this transaction and the costs and
expenses of defending against such liability or asserted liability.
IX.10. EXPENSES. Each of the parties shall bear its own expenses and
legal fees incurred on its behalf with respect to the negotiation, execution and
consummation of the transactions contemplated by this Agreement, except that on
the Closing Date the Company shall pay (i) the reasonable fees and disbursements
of Salans Xxxxxxxxx Xxxxxxxxx Xxxxxxx & Xxxxxx, counsel to the Purchasers, and
(ii) a fee to Xxxxxxxx Xxxxxxxxx equal to 5% of the Aggregate Purchase Price.
IX.11. LITIGATION. The parties each hereby waive trial by jury in any
action or proceeding of any kind or nature in any court in which an action may
be commenced arising out of this Agreement or by reason of any other cause or
dispute whatsoever between them. The parties hereto agree that the State and
Federal Courts which sit in the State of New York and the County of New York
shall have exclusive jurisdiction to hear and determine any claims or disputes
between the Company and such holders, pertaining directly or indirectly to this
Agreement or to any matter arising therefrom. The parties each expressly submit
and consent in advance to such jurisdiction in any action or proceeding
commenced in such courts provided that such consent shall not be deemed to be a
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waiver of personal service of the summons and complaint, or other process or
papers issued therein. The choice of forum set forth in this Section 9.11 shall
not be deemed to preclude the enforcement of any judgment obtained in such forum
or the taking of any action under this Agreement to enforce same in any
appropriate jurisdiction. The parties each waive any objection based upon forum
non conveniens and any objection to venue of any action instituted hereunder.
IX.12. TITLES AND SUBTITLES. The titles of the articles, sections and
subsections of this Agreement are for convenience of reference only and are not
to be considered in construing this Agreement.
IX.13. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
If a Purchaser is in agreement with the foregoing, such Purchaser
should sign where indicated below and thereupon this letter shall become a
binding agreement between such Purchaser and the Company.
Very truly yours,
ADVANCED VIRAL RESEARCH CORP.
By: /s/ XXXXXX X. XXXXXXXXX, M.D.
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Name: Xxxxxx X. Xxxxxxxxx, M.D.
Title: President and Chief Executive Officer
AGREED TO:
PURCHASERS
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Signature
Print Name:
--------------------------
Address:
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EXHIBIT B
TO
SECURITIES PURCHASE AGREEMENT
DATED NOVEMBER 8, 2000
BETWEEN ADVANCED VIRAL RESEARCH CORP.
AND THE PURCHASERS THEREIN
NAME AND ADDRESS NUMBER OF SHARES OF NUMBER OF
OF PURCHASER AMOUNT COMMON STOCK WARRANTS*
------------ ------ ------------ --------
Xxxxxxxxxxx Xxxxxxxxx $80,000 200,000 120,000
00 Xxxxx Xxxx Xxxxxx
Xxxxxxx, Xxx Xxxxxx 00000
Xxxx Xxxxxxx $100,000 250,000 150,000
00X Xxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Xxxxxx Xxxxx $120,000 300,000 180,000
000 Xxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
Xxxxxxx Xxxxxxx** $145,000 362,500 217,500
00 Xxx Xxxxxxx Xxxxxxx
Xxxxxxx, XX 00000
Bridge Ventures, Inc. $100,000 250,000 150,000
0000 Xxxx xx Xxxxxx Xxxxx
Xxxxxxxx Xxx, XX 00000
Xxxxxxxx Xxxxx $40,000 100,000 60,000
000 Xxxxxxx Xxx
Xxxxxxxxxx, XX 00000
Xxxx Xxxxxxxxxx Living Trust $100,000 250,000 150,000
c/o Xxxx Xxxxxxxxxx
0000 X. Xxxxx Xxxxx Xx.
Xxx Xxxxx, XX 00000
Xxxxxxx Xxxxxxxxxxxx $120,000 300,000 180,000
00 Xxxxxxxxx Xxxx
Xxxx Xxxxxxxxxx, XX 00000
Xxxxxxx Xxxxx $240,000 600,000 360,000
00 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Xxxxx Xxxxx $120,000 300,000 180,000
0 Xxxx Xx.
Xxxxxxxx, XX 00000
--------
** Xxxxxxx Xxxxxxx invested $100,000 in December 2000 and $45,000 in January
2001.
13
14
NAME AND ADDRESS NUMBER OF SHARES OF NUMBER OF
OF PURCHASER AMOUNT COMMON STOCK WARRANTS*
------------ ------ ------------ --------
Xxxx X. Xxxxx $150,000 375,000 225,000
00 Xxxxxx Xxxxx
Xxxxxxxx, XX 00000
Xxxxxxx Xxxxxxx*** $20,000 50,000 30,000
c/o Xxx Xxxxxx
0000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxxx Xxxxxxxx $100,000 250,000 150,000
0 Xxxxxxx Xxxxx
Xxx Xxxxxxxx, XX 00000
Xxxxxx Xxxxxxxxx $100,000 250,000 150,000
Hemlock Drive
Alpine, New Jersey
Xxxxxx Director $80,000 200,000 120,000
00 Xxxxxx Xxxx
Xxxxx Xxxxxx, XX 00000
Xxxxxx Xxxxxxxx $80,000 200,000 120,000
0 Xxxxx Xxxx Xxxxxxx
Xxxxxxx, XX 00000
Xxxxxx X. Xxxxxx $200,000 500,000 300,000
0000 Xxx Xxxxxx Xxxxx
Xxxxxx, XX 00000-0000
Xxxxxxx Xxxxxxx $100,000 250,000 150,000
000 Xxxxx Xxxx
Xxxxxxx, XX 00000
Xxxxx Xxxxxxx $80,000 200,000 120,000
0000 Xxxxxxxxxx Xx.
Xxxx Xxxxx, XX 00000
Harbor View Group, Inc. $450,000 1,125,000 675,000
Xxx Xxx Xxxxxxx Xxxx
Xxxxx 000
Xxxxx Xxxxx, XX 00000
-----------
*** Xxxxxxx Xxxxxxx invested $20,000 on January 2001.
14
15
NAME AND ADDRESS NUMBER OF SHARES OF NUMBER OF
OF PURCHASER AMOUNT COMMON STOCK WARRANTS*
------------ ------ ------------ --------
Xxxxx X. Xxxxxxxx $100,000 250,000 150,000
0000 XX Xxxxxxxx Xx.
Xxxxxx, XX 00000
Xxxxx Xxxxxxxxxxxx $80,000 200,000 120,000
00 Xxx Xxxx Xxxxx
Xxxxxxxxxxxx, XX 00000
Xxxxxxxx Xxxxxx $240,000 600,000 360,000
00 Xxxxx Xxxxxxxx Xxxx
Xxxxxxxx, XX 00000-0000
Xxxxx Xxxxxx $300,000 750,000 450,000
0 Xxxxxxx Xxxxxx
Xxxxxxx, Xxx Xxxx 00000
Xxxxxx Xxxxxx $100,000 250,000 150,000
0000 Xxxx Xxxx Xxxx
Xxxxxxx, Xxx Xxxx 00000
Xxxxxxxxx Xxxx $200,000 500,000 300,000
0000 Xxxxxxxxx Xxxxx XX
Xxxxxxx, XX 00000
Xxx X. Xxxxxxx $50,000 125,000 75,000
0000 Xxxx Xxxx Xxxxx
Xxxx, XX 00000
Xxxxx Xxxxxx and Xxxxx Xxxxxx, Joint $44,000 110,000 66,000
Tenants
00 Xxxxxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Xxxxxx Xxxxxxx $80,000 200,000 120,000
3 Xxxxx
Xxxxxxxxxx, XX 00000
Xxxxxxx X. Xxxxxx $160,000 400,000 240,000
00 Xxxxx Xxxx Xxxxx
Xxxxxx Xxxx, XX 00000
Xxxxxx Xxxxxxxx $300,000 750,000 450,000
0000 Xxxxxxxx Xxxx Xxxxx
Xxxxxxx, XX 00000
15
16
NAME AND ADDRESS NUMBER OF SHARES OF NUMBER OF
OF PURCHASER AMOUNT COMMON STOCK WARRANTS*
------------ ------ ------------ --------
Xxxxxxx Xxxxxxxx $40,000 100,000 60,000
0000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Xxxxx Xxxxxxxxxx $350,000 875,000 525,000
0 Xxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Xxxxx Xxxxxx $222,000 555,000 333,000
000 X. 00xx Xxxxxx
Xxx Xxxx, XX 00000
Xxxxx Xxxxxxx $80,000 200,000 120,000
c/o Barymor Enterprises, Inc.
X.X. Xxx 000
Xxxxxxxxx, XX 00000
Xxx Xxxxxx $500,000 1,250,000 750,000
00 Xxx Xxxxxxx Xxxxxxx
Xxxxxxx, XX 00000
-----------------
* 50% of such Warrants have an exercise price of $.48 per share and 50% of
such warrants have an exercise price of $.56 per share.
16
17
EXHIBIT A-1
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON THE EXERCISE
OF THIS WARRANT (COLLECTIVELY, THE "SECURITIES") HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE
OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT, OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS UNDER THE
SECURITIES ACT.
WARRANT TO PURCHASE
COMMON STOCK, PAR VALUE $.00001 PER SHARE
OF
ADVANCED VIRAL RESEARCH CORP.
------------------------------------------
This certifies that, for value received, [NAME OF PURCHASER],
or registered assigns ("Warrantholder"), is entitled to purchase from ADVANCED
VIRAL RESEARCH CORP. (the "Company"), subject to the provisions of this Warrant,
at any time and from time to time until 5:00 p.m. Eastern Standard Time on
November __, 2005, _______ shares of the Company's Common Stock, par value
$.00001 per share ("Warrant Shares"). The purchase price payable upon the
exercise of this Warrant shall be $.48 per Warrant Share. The Warrant Price and
the number of Warrant Shares which the Warrantholder is entitled to purchase is
subject to adjustment upon the occurrence of the contingencies set forth in
Section 3 of this Warrant, and as adjusted from time to time, such purchase
price is hereinafter referred to as the "Warrant Price."
This Warrant is subject to the following terms and conditions:
I. EXERCISE OF WARRANT.
(a) This Warrant may be exercised in whole or in part
but not for a fractional share. Upon delivery of this Warrant at the offices of
the Company or at such other address as the Company may designate by notice in
writing to the registered holder hereof with the Subscription Form annexed
hereto duly executed, accompanied by payment of the Warrant Price for the number
of Warrant Shares purchased (in cash, by certified, cashier's or other check
17
18
acceptable to the Company, or any combination of the foregoing), the registered
holder of this Warrant shall be entitled to receive a certificate or
certificates for the Warrant Shares so purchased. Such certificate or
certificates shall be promptly delivered to the Warrantholder. Upon any partial
exercise of this Warrant, the Company shall execute and deliver a new Warrant of
like tenor for the balance of the Warrant Shares purchasable hereunder.
(b) The Warrant Shares deliverable hereunder shall,
upon issuance, be fully paid and non-assessable and the Company agrees that at
all times during the term of this Warrant it shall cause to be reserved for
issuance such number of shares of its Common Stock as shall be required for
issuance and delivery upon exercise of this Warrant.
II. TRANSFER OR ASSIGNMENT OF WARRANT.
(a) Any assignment or transfer of this Warrant shall
be made by surrender of this Warrant at the offices of the Company or at such
other address as the Company may designate in writing to the registered holder
hereof with the Assignment Form annexed hereto duly executed and accompanied by
payment of any requisite transfer taxes, and the Company shall, without charge,
execute and deliver a new Warrant of like tenor in the name of the assignee for
the portion so assigned in case of only a partial assignment, with a new Warrant
of like tenor to the assignor for the balance of the Warrant Shares purchasable.
(b) Prior to any assignment or transfer of this
Warrant, the holder thereof shall, if reasonably requested by the Company,
deliver an opinion of counsel to the Company to the effect that the proposed
transfer may be effected without registration under the Act.
III. ADJUSTMENT OF WARRANT PRICE AND WARRANT SHARES --
ANTI-DILUTION PROVISIONS.
A. (1) Except as hereinafter provided, in case the
Company shall at any time after the date hereof issue any
shares of Common Stock (including shares held in the Company's
treasury) without consideration, then, and thereafter
successively upon each issuance, the Warrant Price in effect
immediately prior to each such issuance shall forthwith be
reduced to a price determined by multiplying the Warrant Price
in effect immediately prior to such issuance by a fraction:
(a) the numerator of which shall be the total
number of shares of Common Stock outstanding
immediately prior to such issuance, and
(b) the denominator of which shall be the total
number of shares of Common Stock outstanding
immediately after such issuance.
For the purposes of any computation to be made in accordance
with the provisions of this clause (1), the following provisions shall be
applicable:
(i) Shares of Common Stock issuable by way of dividend or
other distribution on any stock of the Company shall be deemed to have been
issued and to be outstanding at the close of business on the record date fixed
18
19
for the determination of stockholders entitled to receive such dividend or other
distribution and shall be deemed to have been issued without consideration.
Shares of Common Stock issued otherwise than as a dividend, shall be deemed to
have been issued and to be outstanding at the close of business on the date of
issue.
(ii) The number of shares of Common Stock at any time
outstanding shall not include any shares then owned or held by or for the
account of the Company.
(2) In case the Company shall at any
time subdivide or combine the outstanding
shares of Common Stock, the Warrant Price
shall forthwith be proportionately decreased
in the case of the subdivision or
proportionately increased in the case of
combination to the nearest one cent. Any
such adjustment shall become effective at
the close of business on the date that such
subdivision or combination shall become
effective.
B. In the event that the number of outstanding shares
of Common Stock is increased by a stock dividend payable in
shares of Common Stock or by a subdivision of the outstanding
shares of Common Stock, which may include a stock split, then
from and after the time at which the adjusted Warrant Price
becomes effective pursuant to the foregoing Subsection A of
this Section by reason of such dividend or subdivision, the
number of shares issuable upon the exercise of this Warrant
shall be increased in proportion to such increase in
outstanding shares. In the event that the number of
outstanding shares of Common Stock is decreased by a
combination of the outstanding shares of Common Stock, then,
from and after the time at which the adjusted Warrant Price
becomes effective pursuant to such Subsection A of this
Section by reason of such combination, the number of shares
issuable upon the exercise of this Warrant shall be decreased
in proportion to such decrease in outstanding shares.
C. In the event of an adjustment of the Warrant
Price, the number of shares of Common Stock (or reclassified
stock) issuable upon exercise of this Warrant after such
adjustment shall be equal to the number determined by
dividing:
(1) an amount equal to the product of
(i) the number of shares of Common
Stock issuable upon exercise of this
Warrant immediately prior to such
adjustment, and (ii) the Warrant
Price immediately prior to such
adjustment, by
(2) the Warrant Price immediately after
such adjustment.
D. In the case of any reorganization or
reclassification of the outstanding shares of Common Stock
(other than a change in par value, or from par value to no par
value, or from no par value to par value, or as a result of a
subdivision or combination) or in the case of any
consolidation of the Company with, or merger of the Company
with, another corporation, or in the case of any sale, lease
or conveyance of all, or substantially all, of the property,
assets, business and goodwill of the Company as an entity, the
holder of this Warrant shall thereafter have the right upon
19
20
exercise to purchase the kind and amount of shares of stock
and other securities and property receivable upon such
reorganization, reclassification, consolidation, merger or
sale by a holder of the number of shares of Common Stock which
the holder of this Warrant would have received had all Warrant
Shares issuable upon exercise of this Warrant been issued
immediately prior to such reorganization, reclassification,
consolidation, merger or sale, at a price equal to the Warrant
Price then in effect pertaining to this Warrant (the kind,
amount and price of such stock and other securities to be
subject to adjustment as herein provided).
E. In case the Company shall, at any time prior to
the expiration of this Warrant and prior to the exercise
thereof, dissolve, liquidate or wind up its affairs, the
Warrantholder shall be entitled, upon the exercise hereof, to
receive, in lieu of the Warrant Shares of the Company which it
would have been entitled to receive, the same kind and amount
of assets as would have been issued, distributed or paid to it
upon such Warrant Shares of the Company, had it been the
holder of record of shares of Common Stock receivable upon the
exercise of this Warrant on the record date for the
determination of those entitled to receive any such
liquidating distribution. After any such dissolution,
liquidation or winding up which shall result in any
distribution in excess of the Warrant Price provided for by
this Warrant, the Warrantholder may at its option exercise the
same without making payment of the aggregate Warrant Price and
in such case the Company shall upon the distribution to said
Warrantholder consider that the aggregate Warrant Price has
been paid in full to it and in making settlement to said
Warrantholder, shall deduct from the amount payable to such
Warrantholder an amount equal to the aggregate Warrant Price.
F. In case the Company shall, at any time prior to
the expiration of this Warrant and prior to the exercise
thereof make a distribution of assets (other than cash) or
securities of the Company to its stockholders (the
"Distribution") the Warrantholder shall be entitled, upon the
exercise thereof, to receive, in addition to the Warrant
Shares it is entitled to receive, the same kind and amount of
assets or securities as would have been distributed to it in
the Distribution had it been the holder of record of shares of
Common Stock receivable upon exercise of this Warrant on the
record date for determination of those entitled to receive the
Distribution.
G. Irrespective of any adjustments in the number of
Warrant Shares and the Warrant Price or the number or kind of
shares purchasable upon exercise of this Warrant, this Warrant
may continue to express the same price and number and kind of
shares as originally issued.
IV. OFFICER'S CERTIFICATE. Whenever the number of Warrant
Shares and the Warrant Price shall be adjusted pursuant to the provisions
hereof, the Company shall forthwith file at its principal executive office a
statement, signed by the Chairman of the Board, President, or one of the Vice
20
21
Presidents of the Company and by its Chief Financial Officer or one of its
Treasurers or Assistant Treasurers, stating the adjusted number of Warrant
Shares and the new Warrant Price calculated to the nearest one hundredth of a
cent and setting forth in reasonable detail the method of calculation and the
facts requiring such adjustment and upon which such calculation is based. Each
adjustment shall remain in effect until a subsequent adjustment hereunder is
required. A copy of such statement shall be mailed to the Warrantholder.
V. CHARGES, TAXES AND EXPENSES. The issuance of certificates
for Warrant Shares upon any exercise of this Warrant shall be made without
charge to the Warrantholder for any tax or other expense in respect to the
issuance of such certificates, all of which taxes and expenses shall be paid by
the Company, and such certificates shall be issued only in the name of the
Warrantholder.
VI. MISCELLANEOUS.
(a) The terms of this Warrant shall be binding upon
and shall inure to the benefit of any successors or assigns of the Company and
of the holder or holders hereof and of the shares of Common Stock issued or
issuable upon the exercise hereof.
(b) No holder of this Warrant, as such, shall be
entitled to vote or receive dividends or be deemed to be a stockholder of the
Company for any purpose, nor shall anything contained in this Warrant be
construed to confer upon the holder of this Warrant, as such, any rights of a
stockholder of the Company or any right to vote, give or withhold consent to any
corporate action, receive notice of meetings, receive dividends or subscription
rights, or otherwise.
(c) Receipt of this Warrant by the holder hereof
shall constitute acceptance of an agreement to the foregoing terms and
conditions.
(d) The Warrant and the performance of the parties
hereunder shall be construed and interpreted in accordance with the laws of the
State of New York and the parties hereunder consent and agree that the State and
Federal Courts which sit in the State of New York and the County of New York
shall have exclusive jurisdiction with respect to all controversies and disputes
arising hereunder.
IN WITNESS WHEREOF, the Company has caused this Warrant to be
signed by its duly authorized officer and its corporate seal to be affixed
hereto.
Dated: November ___, 2000
ADVANCED VIRAL RESEARCH CORP.
By:
----------------------------
Xxxxxx Xxxxxxxxx, M.D.
President
21
22
SUBSCRIPTION FORM
(TO BE EXECUTED BY THE REGISTERED HOLDER
IF HE DESIRES TO EXERCISE THE WARRANT)
TO: ADVANCED VIRAL RESEARCH CORP.
The undersigned hereby exercises the right to purchase
_________ shares of Common Stock, par value $.00001 per share, covered by the
attached Warrant in accordance with the terms and conditions thereof, and
herewith makes payment of the Warrant Price for such shares in full.
-------------------------------------------
SIGNATURE
-------------------------------------------
-------------------------------------------
ADDRESS
DATED:
------------------------
22
23
ASSIGNMENT
(TO BE EXECUTED BY THE REGISTERED HOLDER
IF HE DESIRES TO TRANSFER THE WARRANT)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto the right to purchase shares of Common Stock of ADVANCED VIRAL
RESEARCH CORP., evidenced by the within Warrant, and does hereby irrevocably
constitute and appoint Attorney to transfer the said Warrant on the books of the
Company, with full power of substitution.
-------------------------------------------
SIGNATURE
-------------------------------------------
-------------------------------------------
ADDRESS
DATED:
-------------------------------
IN THE PRESENCE OF:
23
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EXHIBIT A-2
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON THE EXERCISE OF
THIS WARRANT (COLLECTIVELY, THE "SECURITIES") HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE
OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT, OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS UNDER THE SECURITIES ACT.
WARRANT TO PURCHASE
COMMON STOCK, PAR VALUE $.00001 PER SHARE
OF
ADVANCED VIRAL RESEARCH CORP.
-------------------------------------------
This certifies that, for value received, [NAME OF PURCHASER],
or registered assigns ("Warrantholder"), is entitled to purchase from ADVANCED
VIRAL RESEARCH CORP. (the "Company"), subject to the provisions of this Warrant,
at any time and from time to time until 5:00 p.m. Eastern Standard Time on
November __, 2005, _______ shares of the Company's Common Stock, par value
$.00001 per share ("Warrant Shares"). The purchase price payable upon the
exercise of this Warrant shall be $.56 per Warrant Share. The Warrant Price and
the number of Warrant Shares which the Warrantholder is entitled to purchase is
subject to adjustment upon the occurrence of the contingencies set forth in
Section 3 of this Warrant, and as adjusted from time to time, such purchase
price is hereinafter referred to as the "Warrant Price."
This Warrant is subject to the following terms and conditions:
I. EXERCISE OF WARRANT.
(a) This Warrant may be exercised in whole or in part
but not for a fractional share. Upon delivery of this Warrant at the offices of
the Company or at such other address as the Company may designate by notice in
writing to the registered holder hereof with the Subscription Form annexed
hereto duly executed, accompanied by payment of the Warrant Price for the number
of Warrant Shares purchased (in cash, by certified, cashier's or other check
acceptable to the Company, or any combination of the foregoing), the registered
holder of this Warrant shall be entitled to receive a certificate or
24
25
certificates for the Warrant Shares so purchased. Such certificate or
certificates shall be promptly delivered to the Warrantholder. Upon any partial
exercise of this Warrant, the Company shall execute and deliver a new Warrant of
like tenor for the balance of the Warrant Shares purchasable hereunder.
(b) The Warrant Shares deliverable hereunder shall,
upon issuance, be fully paid and non-assessable and the Company agrees that at
all times during the term of this Warrant it shall cause to be reserved for
issuance such number of shares of its Common Stock as shall be required for
issuance and delivery upon exercise of this Warrant.
II. TRANSFER OR ASSIGNMENT OF WARRANT.
(a) Any assignment or transfer of this Warrant shall
be made by surrender of this Warrant at the offices of the Company or at such
other address as the Company may designate in writing to the registered holder
hereof with the Assignment Form annexed hereto duly executed and accompanied by
payment of any requisite transfer taxes, and the Company shall, without charge,
execute and deliver a new Warrant of like tenor in the name of the assignee for
the portion so assigned in case of only a partial assignment, with a new Warrant
of like tenor to the assignor for the balance of the Warrant Shares purchasable.
(b) Prior to any assignment or transfer of this
Warrant, the holder thereof shall, if reasonably requested by the Company,
deliver an opinion of counsel to the Company to the effect that the proposed
transfer may be effected without registration under the Act.
III. ADJUSTMENT OF WARRANT PRICE AND WARRANT SHARES --
ANTI-DILUTION PROVISIONS.
A. (1) Except as hereinafter provided, in
case the Company shall at any time after the date
hereof issue any shares of Common Stock (including
shares held in the Company's treasury) without
consideration, then, and thereafter successively upon
each issuance, the Warrant Price in effect
immediately prior to each such issuance shall
forthwith be reduced to a price determined by
multiplying the Warrant Price in effect immediately
prior to such issuance by a fraction:
(a) the numerator of which shall be the
total number of shares of Common
Stock outstanding immediately prior
to such issuance, and
(b) the denominator of which shall be
the total number of shares of Common
Stock outstanding immediately after
such issuance.
For the purposes of any computation to be made in accordance
with the provisions of this clause (1), the following provisions shall be
applicable:
25
26
(i) Shares of Common Stock issuable by way of
dividend or other distribution on any stock of the Company shall be deemed to
have been issued and to be outstanding at the close of business on the record
date fixed for the determination of stockholders entitled to receive such
dividend or other distribution and shall be deemed to have been issued without
consideration. Shares of Common Stock issued otherwise than as a dividend, shall
be deemed to have been issued and to be outstanding at the close of business on
the date of issue.
(ii) The number of shares of Common Stock at any time
outstanding shall not include any shares then owned or held by or for the
account of the Company.
(2) In case the Company shall at any
time subdivide or combine the outstanding
shares of Common Stock, the Warrant Price
shall forthwith be proportionately decreased
in the case of the subdivision or
proportionately increased in the case of
combination to the nearest one cent. Any
such adjustment shall become effective at
the close of business on the date that such
subdivision or combination shall become
effective.
B. In the event that the number of outstanding shares
of Common Stock is increased by a stock dividend payable in
shares of Common Stock or by a subdivision of the outstanding
shares of Common Stock, which may include a stock split, then
from and after the time at which the adjusted Warrant Price
becomes effective pursuant to the foregoing Subsection A of
this Section by reason of such dividend or subdivision, the
number of shares issuable upon the exercise of this Warrant
shall be increased in proportion to such increase in
outstanding shares. In the event that the number of
outstanding shares of Common Stock is decreased by a
combination of the outstanding shares of Common Stock, then,
from and after the time at which the adjusted Warrant Price
becomes effective pursuant to such Subsection A of this
Section by reason of such combination, the number of shares
issuable upon the exercise of this Warrant shall be decreased
in proportion to such decrease in outstanding shares.
C. In the event of an adjustment of the Warrant
Price, the number of shares of Common Stock (or reclassified
stock) issuable upon exercise of this Warrant after such
adjustment shall be equal to the number determined by
dividing:
(1) an amount equal to the product of
(i) the number of shares of Common
Stock issuable upon exercise of this
Warrant immediately prior to such
adjustment, and (ii) the Warrant
Price immediately prior to such
adjustment, by
(2) the Warrant Price immediately after
such adjustment.
26
27
D. In the case of any reorganization or
reclassification of the outstanding shares of Common Stock
(other than a change in par value, or from par value to no par
value, or from no par value to par value, or as a result of a
subdivision or combination) or in the case of any
consolidation of the Company with, or merger of the Company
with, another corporation, or in the case of any sale, lease
or conveyance of all, or substantially all, of the property,
assets, business and goodwill of the Company as an entity, the
holder of this Warrant shall thereafter have the right upon
exercise to purchase the kind and amount of shares of stock
and other securities and property receivable upon such
reorganization, reclassification, consolidation, merger or
sale by a holder of the number of shares of Common Stock which
the holder of this Warrant would have received had all Warrant
Shares issuable upon exercise of this Warrant been issued
immediately prior to such reorganization, reclassification,
consolidation, merger or sale, at a price equal to the Warrant
Price then in effect pertaining to this Warrant (the kind,
amount and price of such stock and other securities to be
subject to adjustment as herein provided).
E. In case the Company shall, at any time prior to
the expiration of this Warrant and prior to the exercise
thereof, dissolve, liquidate or wind up its affairs, the
Warrantholder shall be entitled, upon the exercise hereof, to
receive, in lieu of the Warrant Shares of the Company which it
would have been entitled to receive, the same kind and amount
of assets as would have been issued, distributed or paid to it
upon such Warrant Shares of the Company, had it been the
holder of record of shares of Common Stock receivable upon the
exercise of this Warrant on the record date for the
determination of those entitled to receive any such
liquidating distribution. After any such dissolution,
liquidation or winding up which shall result in any
distribution in excess of the Warrant Price provided for by
this Warrant, the Warrantholder may at its option exercise the
same without making payment of the aggregate Warrant Price and
in such case the Company shall upon the distribution to said
Warrantholder consider that the aggregate Warrant Price has
been paid in full to it and in making settlement to said
Warrantholder, shall deduct from the amount payable to such
Warrantholder an amount equal to the aggregate Warrant Price.
F. In case the Company shall, at any time prior to
the expiration of this Warrant and prior to the exercise
thereof make a distribution of assets (other than cash) or
securities of the Company to its stockholders (the
"Distribution") the Warrantholder shall be entitled, upon the
exercise thereof, to receive, in addition to the Warrant
Shares it is entitled to receive, the same kind and amount of
assets or securities as would have been distributed to it in
the Distribution had it been the holder of record of shares of
Common Stock receivable upon exercise of this Warrant on the
record date for determination of those entitled to receive the
Distribution.
G. Irrespective of any adjustments in the number of
Warrant Shares and the Warrant Price or the number or kind of
shares purchasable upon exercise of this Warrant, this Warrant
may continue to express the same price and number and kind of
shares as originally issued.
27
28
IV. OFFICER'S CERTIFICATE. Whenever the number of Warrant
Shares and the Warrant Price shall be adjusted pursuant to the provisions
hereof, the Company shall forthwith file at its principal executive office a
statement, signed by the Chairman of the Board, President, or one of the Vice
Presidents of the Company and by its Chief Financial Officer or one of its
Treasurers or Assistant Treasurers, stating the adjusted number of Warrant
Shares and the new Warrant Price calculated to the nearest one hundredth of a
cent and setting forth in reasonable detail the method of calculation and the
facts requiring such adjustment and upon which such calculation is based. Each
adjustment shall remain in effect until a subsequent adjustment hereunder is
required. A copy of such statement shall be mailed to the Warrantholder.
V. CHARGES, TAXES AND EXPENSES. The issuance of certificates
for Warrant Shares upon any exercise of this Warrant shall be made without
charge to the Warrantholder for any tax or other expense in respect to the
issuance of such certificates, all of which taxes and expenses shall be paid by
the Company, and such certificates shall be issued only in the name of the
Warrantholder.
VI. MISCELLANEOUS.
(a) The terms of this Warrant shall be binding upon
and shall inure to the benefit of any successors or assigns of the Company and
of the holder or holders hereof and of the shares of Common Stock issued or
issuable upon the exercise hereof.
(b) No holder of this Warrant, as such, shall be
entitled to vote or receive dividends or be deemed to be a stockholder of the
Company for any purpose, nor shall anything contained in this Warrant be
construed to confer upon the holder of this Warrant, as such, any rights of a
stockholder of the Company or any right to vote, give or withhold consent to any
corporate action, receive notice of meetings, receive dividends or subscription
rights, or otherwise.
(c) Receipt of this Warrant by the holder hereof
shall constitute acceptance of an agreement to the foregoing terms and
conditions.
(d) The Warrant and the performance of the parties
hereunder shall be construed and interpreted in accordance with the laws of the
State of New York and the parties hereunder consent and agree that the State and
Federal Courts which sit in the State of New York and the County of New York
shall have exclusive jurisdiction with respect to all controversies and disputes
arising hereunder.
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IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by
its duly authorized officer and its corporate seal to be affixed hereto.
Dated: November ___, 2000
ADVANCED VIRAL RESEARCH CORP.
By:
--------------------------
Xxxxxx Xxxxxxxxx, M.D.
President
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SUBSCRIPTION FORM
(TO BE EXECUTED BY THE REGISTERED HOLDER
IF HE DESIRES TO EXERCISE THE WARRANT)
TO: ADVANCED VIRAL RESEARCH CORP.
The undersigned hereby exercises the right to purchase
_________ shares of Common Stock, par value $.00001 per share, covered by the
attached Warrant in accordance with the terms and conditions thereof, and
herewith makes payment of the Warrant Price for such shares in full.
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SIGNATURE
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-------------------------------------------
ADDRESS
DATED:
------------------------
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ASSIGNMENT
(TO BE EXECUTED BY THE REGISTERED HOLDER
IF HE DESIRES TO TRANSFER THE WARRANT)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto ________________ the right to purchase shares of Common Stock of
ADVANCED VIRAL RESEARCH CORP., evidenced by the within Warrant, and does hereby
irrevocably constitute and appoint ___________________ Attorney to transfer the
said Warrant on the books of the Company, with full power of substitution.
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SIGNATURE
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-------------------------------------------
ADDRESS
DATED:
-------------------------------
IN THE PRESENCE OF:
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