EXHIBIT 10.79
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
February __, 2003 (the "Initial Exercise Date") and on or prior to the close of
business on the third anniversary of the Initial Exercise Date (the "Termination
Date") but not thereafter, to subscribe for and purchase from Viragen, Inc., a
corporation incorporated in the State of Delaware (the "Company"), up to
____________ shares (the "Warrant Shares") of Common Stock, par value $0.01 per
share, of the Company (the "Common Stock"). The purchase price of one share of
Common Stock (the "Exercise Price") under this Warrant shall be $_____, 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 8, 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-Sholes option pricing formula
which amount shall in no event exceed 150% of the product of the Exercise Price
and the number of Warrant Shares issuable hereunder. In case of any such
reorganization, reclassification, merger, consolidation or disposition of
assets, the successor or acquiring corporation (if other than the Company) shall
expressly assume the due and punctual observance and performance of each and
every covenant and condition of this Warrant to be performed and observed by the
Company and all the obligations and liabilities hereunder, subject to such
modifications as may be deemed appropriate (as determined in good faith by
resolution of the Board of Directors of the Company) in order to provide for
adjustments of Warrant Shares for which this Warrant is exercisable which shall
be as nearly equivalent as practicable to the adjustments provided for in this
Section 12. For purposes of this Section 12, "common stock of the successor or
acquiring corporation" shall include stock of such corporation of any class
which is not preferred as to dividends or assets over any other class of stock
of such corporation and which is not subject to redemption and shall also
include any evidences of indebtedness, shares of stock or other securities which
are convertible into or exchangeable for any such stock, either immediately or
upon the arrival of a specified date or the happening of a specified event and
any warrants or other rights to subscribe for or purchase any such stock. The
foregoing provisions of this Section 12 shall
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: February __, 2003
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:
Dated:
NOTE
The execution to the foregoing Notice of Exercise must exactly correspond to
the name of the Holder on the Warrant.
