EXHIBIT 10.1
SECURITIES PURCHASE AGREEMENT
THIS SECURITIES PURCHASE AGREEMENT is dated as of February 3, 2004 by
and among ADVANCED VIRAL RESEARCH CORP., a Delaware corporation (the "Company"),
and XXXXX X. XXXXX XX and XXXXX X. XXXXX III (each of whom is hereinafter
referred to as a "Purchaser" and all of whom are referred to as "Purchasers").
RECITALS
WHEREAS, the parties desire that, upon the terms contained herein, the
Company shall issue and sell to Purchasers and Purchasers shall purchase from
the Company, (i) 120,000,000 shares (the "Shares") of the Company's common
stock, par value $0.00001 per share (the "Common Stock"); and (ii) warrants to
purchase 15,000,000 shares of Common Stock (the "Warrants") in the form attached
hereto as EXHIBIT A. For purposes of this Agreement, the term "Securities" shall
mean the Shares, the Warrants, and the shares of Common Stock which may be
purchased pursuant to the Warrants (the "Warrant Shares").
WHEREAS, such investment will be made in reliance upon the provisions
of Section 4(2) of the Securities Act of 1933, as amended (the "Securities
Act"), and the regulations promulgated thereunder, and or upon such other
exemption from the registration requirements of the Securities Act as may be
available with respect to any or all of the investments to be made hereunder.
WHEREAS, contemporaneously with the execution and delivery of this
Agreement, the parties hereto are executing and delivering a Registration Rights
Agreement substantially in the form attached hereto as Schedule B (the
"Registration Rights Agreement") pursuant to which the Company has agreed to
provide certain registration rights under the Securities Act and applicable
state securities laws.
NOW, THEREFORE, the parties hereto agree as follows:
1. SALE AND PURCHASE OF THE SHARES AND WARRANTS; CLOSING
1.1. SALE AND PURCHASE OF THE SHARES AND THE WARRANTS. Upon the terms
hereof and in reliance on the representations and warranties contained herein,
or made pursuant hereto, the Company will issue and sell to each Purchaser and
each Purchaser agrees (on a several basis and not on a joint basis) to purchase
from the Company that number of Shares on the closing dates specified in the
table at Section 1.2 under Purchaser's name at a purchase price of $.10 per
share. Each Purchaser shall be issued at the first closing specified in Section
1.2 the right to purchase one Warrant Share pursuant to the Warrant for each
eight shares that Purchaser has agreed to purchase pursuant to this Agreement.
1.2. AMOUNT OF SHARES AND CLOSING DATES. The closing of the purchase
and sale of the Shares at an aggregate purchase price of $12,000,000 shall occur
in the following amounts no later than 10:00 a.m. on the following closing dates
(the "Closing Dates"):
[The balance of this page is intentionally left blank.]
Closing Closing Date Xxxxx X. Xxxxx XX Xxxxx X. Xxxxx III Grand Total
------- ------------ ----------------- ------------------ -----------
(Dollars/shares) (Dollars/shares) (Dollars/shares)
---------------- ---------------- ----------------
1ST February 5, 2004 $1,500,000 $1,500,000 $3,000,000
15,000,000 shs 15,000,000 shs 30,000,000 SHS
Warrants for Warrants for WARRANTS FOR
7,500,000 shs 7,500,000 shs 15,000,000 SHS
2ND May 5, 2004 $1,500,000 $1,500,000 $3,000,000
15,000,000 shs 15,000,000 shs 30,000,000 SHS
3RD August 4, 2004 $1,500,000 $1,500,000 $3,000,000
15,000,000 shs 15,000,000 shs 30,000,000 SHS
4TH November 3, 2004 $1,500,000 $1,500,000 $3,000,000
15,000,000 shs 15,000,000 shs 30,000,000 SHS
================================================================================
TOTAL $6,000,000 $6,000,000 $12,000,000
60,000,000 SHS 60,000,000 SHS 120,000,000 SHS
WARRANTS FOR WARRANTS FOR WARRANTS FOR
7,500,000 SHS 7,500,000 SHS 15,000,000 SHS
1.3. CLOSING DELIVERIES.
(a) On the first Closing Date the Company shall deliver to
each Purchaser (i) the number of Shares specified in the table at Section 1.2 as
being purchased by the particular Purchaser at the first Closing against
delivery by that Purchaser to the Company of a certified or official bank check
for the purchase price of such shares as specified in the table at Section 1.2,
payable to the order of the Company or wire transfer of immediately available
funds in the same amount; and (ii) a Warrant registered in the particular
Purchaser's name for that number of Warrant Shares specified under Purchaser's
name in the table at Section 1.2.
(b) On each of the second, third and fourth Closing Dates, the
Company shall deliver to each Purchaser the number of Shares specified in the
table at Section 1.2 as being purchased by the particular Purchaser at the
particular Closing against delivery by that Purchaser to the Company of a
certified or official bank check for the purchase price of such shares as
specified in the table at Section 1.2, payable to the order of the Company or
wire transfer of immediately available funds in the same amount.
1.4. LEGENDS. The certificate(s) representing the Shares and Warrants
delivered to each Purchaser at Closing (and the shares issued upon exercise of
the Warrants) shall be stamped or otherwise imprinted with a legend
substantially similar to 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.
2. PURCHASER'S REPRESENTATIONS AND WARRANTIES
Each Purchaser represents and warrants, severally and solely with
respect to itself and its purchase hereunder and not with respect to any other
Purchaser, that:
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2.1. ACCREDITED INVESTOR. The Purchaser is an "Accredited Investor"
within the meaning of Rule 501 of Regulation D promulgated under the Securities
Act.
2.2. CAPACITY TO ENTER INTO AGREEMENT. The 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 the Purchaser, this Agreement shall constitute a valid and binding
obligation, enforceable in accordance with its terms against the Purchaser,
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.
2.3. INDEPENDENT INVESTIGATION. The Purchaser has had access to copies
of the Company's press releases that were listed on the Company's website as
being issued from August 13, 2002 through January 27, 2004 (the "Press
Releases") and filings by the Company with the Securities and Exchange
Commission (the "COMMISSION"), that were posted on the Commission's XXXXX system
within the last two years as having been filed or submitted by the Company. In
electing to purchase the Shares and the Warrants, each Purchaser has relied
solely upon the representations and warranties of the Company set forth in this
Agreement and on independent investigation made by the Purchaser and its
representatives, if any, and the 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.
2.4. NO GOVERNMENT RECOMMENDATION OR APPROVAL. The Purchaser
understands that no Federal, state, local or foreign governmental body or
regulatory authority has made any finding or determination relating to the
fairness of an investment in any of the Shares or the Warrants and that no
Federal, state, local or foreign governmental body or regulatory authority has
recommended or endorsed, or will recommend or endorse, any investment in any of
the Shares or the Warrants.
2.5. FURTHER LIMITATIONS ON DISPOSITION. Without in any way limiting
the representations set forth above, the Purchaser agrees not to make any
disposition of all or any portion of the Shares or the Warrant 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,
applicable blue sky laws, and the rules and regulations promulgated thereunder,
and in the case of clause (b) the Purchaser shall have furnished the Company
with such information as the Company may reasonably require (including, if
reasonably requested an 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.
2.6. INFORMATION PROVIDED. The Purchaser and its advisors (and its
counsel), if any, have been furnished with all materials relating to the
business, finances and operations of the Company and information it deemed
material to making an informed investment decision. The Purchaser and its
advisors, if any, have been afforded the opportunity to ask questions of the
Company and its management. The Purchaser understands that its investment
involves a high degree of risk. The Purchaser is in a position to evaluate the
merits and risks of this investment. The Purchaser has sought such accounting,
legal and tax advice, as it has considered necessary to make an informed
investment decision with respect to this transaction.
2.7. RISKS; TAX AND ECONOMIC CONSIDERATIONS. The Purchaser recognizes
that an investment in the Shares and the Warrants involves substantial risks,
including loss of the entire amount of such investment. The Purchaser is
familiar with and understands the terms regarding the offer and sale of
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the Shares and the Warrants. With respect to tax and other economic
considerations involved in this investment, the Purchaser is not relying on the
Company. The Purchaser has carefully considered and has, to the extent the
Purchaser believes such discussion necessary, discussed with the Purchaser's
professional legal, tax, accounting and financial advisors the suitability of an
investment in the Company, by purchasing the Shares and the Warrants, for the
Purchaser's particular tax and financial situation and has determined that the
investment being made by the Purchaser is a suitable investment for the
Purchaser.
2.8. NO ADVERTISEMENT, ETC. The Purchaser is not subscribing for the
Shares and the Warrant as a result of, or pursuant to, any advertisement,
article, notice or other communication published in any newspaper, magazine or
similar media or broadcast over television or radio or presented at any seminar
or meeting. The 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 Shares or the Warrants.
2.9. ACQUISITION FOR INVESTMENT. The Purchaser is purchasing the Shares
and the Warrants for its own account, and not with a view toward the public sale
or distribution thereof, except as permitted under the Securities Act. The
Purchaser has not offered nor sold any portion of the Shares or the Warrants nor
does the Purchaser have any intention of dividing the Shares or the Warrants
with others or of selling, distributing or otherwise disposing of any of the
Shares or the Warrants either currently or after the passage of a fixed or
determinable period of time or upon the occurrence or non-occurrence of any
predetermined event or circumstance; provided, however, that by making the
representations herein, the Purchaser does not agree to hold any of the Shares
or the Warrants for any minimum or other specific term and reserves the right to
dispose of the Shares and the Warrants at any time in accordance with or
pursuant to a registration statement or an exemption under the Securities Act
and in compliance with this Agreement.
2.10. NOT AN AFFILIATE. The Purchaser is a separate Purchaser; except
as set forth herein, Purchaser is not acting in concert with or as a group with
any other person in connection with the purchase of the Shares or the Warrants.
The Purchaser is not an officer, director or a person that directly, or
indirectly through one or more intermediaries, controls or is controlled by, or
is under common control with the Company or any "AFFILIATE" of the Company (as
that term is defined in Rule 405 of the Securities Act). Neither the Purchaser
nor its Affiliates has an open short position in the Common Stock.
2.11. TRADING ACTIVITIES. The Purchaser's trading activities with
respect to the Common Stock shall be in compliance with all applicable federal
and state securities laws, rules and regulations and the rules and regulations
of the principal market on which the Common Stock is listed or traded. Neither
the Purchaser nor its affiliates has an open short position in the Common Stock
and, except as set forth below, the Purchaser shall not and will cause its
affiliates not to engage in any short sale as defined in any applicable SEC or
National Association of Securities Dealers rules on any hedging transactions
with respect to the Common Stock.
2.12. LEGAL REPRESENTATION. The Purchaser has had the opportunity to be
represented in this transaction by counsel of its own choice and has been so
advised by counsel for the Company.
2.13. COMPANY RELIANCE. The Purchaser understands that the Shares and
the Warrants are being offered and sold to the Purchaser by the Company in
reliance upon the truth and accuracy of, and the Purchaser's compliance with,
the representations, warranties, agreements, acknowledgments and understandings
of the Purchaser set forth herein and in the documents contemplated in
connection herewith in order to determine the eligibility of the Purchaser to
acquire or receive an offer to acquire the Shares and the Warrants; and the
information with respect to the Purchaser provided to the Company by the
Purchaser is accurate and complete in all material respects.
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3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to each of the Purchasers as
follows:
3.1 ORGANIZATION AND EXISTENCE, ETC. The Company is a corporation duly
organized and validly existing and in good standing under the laws of the
jurisdiction in which it is incorporated, 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 Shares, the Warrants, and the Warrant Shares
as contemplated herein 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.
3.2 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 Shares, Warrant and the Warrant Shares has been taken. The
Shares and Warrant Shares, when issued and sold in accordance with the terms
hereof, will be validly issued, fully paid and non-assessable. The Company has
reserved 135,000,000 shares of its authorized and unissued Common Stock for
issuance in accordance with the terms of this Agreement and will keep such
reservation in effect to the extent that the Company may be required to issue
shares of Common Stock under this Agreement.
3.3 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,
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. No
stockholder of the Company has or will have any preemptive rights or rights of
first refusal by reason of the issuance of the Shares, the Warrants or the
Warrant Shares.
3.4 OFFERING. Subject in part to the truth and accuracy of the
representations made by the Purchaser herein and the Purchaser's compliance with
its covenants set forth in this Agreement, the offer, sale and issuance of the
Shares, the Warrant, and the Warrant Shares, 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.
3.5 CAPITALIZATION. As of the date hereof, the authorized capital stock
of the Company was comprised solely of 1,000,000,000 shares of Common Stock, of
which there were 559,633,459 shares outstanding on such date. Except for the
obligations of the Company to issue Common Stock as described in the Company's
most recent filings with the Commission and the transactions contemplated
hereby, as of the date hereof there were no outstanding options, warrants,
rights to subscribe for, puts,
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calls, rights of first refusal, agreements, or other commitments of any
character whatsoever that could require the Company to issue additional shares
of Common Stock.
3.6 SEC REPORTS.
(a) The Company filed on December 30, 2003 with the Commission
a Prospectus pursuant to Rule 424(b)(3) under the Securities Act relating to
Registration Statement No. 333-107178 (the "Prospectus") and files reports and
other information (together with the Prospectus, "SEC Reports") with the
Commission pursuant to Section 13 and 15(d) of 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 or the
Securities, as the case may be. None of the SEC Reports contains, or will
contain, as of the respective dates thereof, 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 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, 2002 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 each 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.
3.7 EXCHANGE ACT REGISTRATION. The Company has not been and is not
required to register the Common Stock under the Exchange Act and will not
voluntarily register the Common Stock under the Exchange Act prior to March 31,
2005.
3.8 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 the Purchaser or its 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 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 or in the SEC Reports.
4. SOLE CONDITION TO PURCHASER'S OBLIGATION TO CLOSE
The obligation hereunder of each Purchaser to purchase Shares from the
Company at each Closing Date is subject to the satisfaction, or waiver by the
Purchaser, at or before each such Closing Date, of the following condition:
The representations and warranties of the Company contained herein or
made pursuant to this Agreement must be true and correct in all material
respects as of the particular Closing Date as though made at that time (except
for representations and warranties that speak as of a specific date, which
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representations and warranties must be true and correct as of such date) and the
Company must have performed and complied with the covenants and conditions
required by this Agreement to be performed or complied with by the Company at or
prior to the particular Closing Date.
5. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE COMPANY
The obligation hereunder of the Company to issue and sell the Shares
and the Warrant to the Purchaser at each Closing Date is subject to the
satisfaction, or waiver by the Company, at or before each such Closing Date, of
each of the conditions set forth below.
5.1 REPRESENTATIONS. The representations made by the Purchaser in
Section 2 hereof shall be true and correct when made and shall be true and
correct on each Closing Date.
5.2 LEGAL INVESTMENT. At the time of each Closing Date, the offer, sale
and purchase of the Shares shall be legally permitted by all laws and
regulations to which the Purchaser and the Company are subject.
5.3 PAYMENT OF PURCHASE PRICE. At each Closing Date, the Company shall
have received payment in full of the applicable portion of the Purchase Price.
6. AFFIRMATIVE COVENANTS AND INDEMNIFICATION
Each of the Purchasers (severally and not jointly) and the Company
hereby covenant and agree as follows:
6.1 FURTHER ASSURANCES. From time to time the Company shall execute and
deliver to the Purchaser and the 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.
6.2 REGISTRATION RIGHTS. The Company filed with the Commission on
January 29, 2004 a Registration Statement on Form S-1 to register the offer and
sale of certain shares of its Common Stock by certain selling stockholders (the
"2004 Registration Statement"). The Company shall use its best efforts to amend
on or before the date which is 30 days after the First Closing Date, the 2004
Registration Statement to register as part of the 2004 Registration Statement
the Shares and the Warrant Shares for resale by the Purchasers. The Company
shall thereafter use its best efforts to cause the 2004 Registration Statement
as so amended to include the Shares and the Warrant Shares to be declared
effective by the Commission. Nothing contained in this Section 6.2 is intended
to limit the rights of Purchasers under the Registration Rights Agreement.
6.3 INDEMNIFICATION.
(a) The Company agrees to indemnify and hold each Purchaser
(and its officers, directors, employees and agents, and each person who controls
any of them within the meaning of the Securities Act) harmless from and against
any losses, claims, damages or liabilities to which the Purchaser (or any such
other person) 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) contained in or incorporated by reference in the 2004
Registration Statement or any other Registration Statement relating to the
Shares (the "Registration Statement"), or arise out of any failure by the
Company to fulfill any undertaking included in the
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Registration Statement, and the Company will reimburse the Purchaser (or any
such other person) for 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 the Purchaser or on the 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 the Purchaser of its Shares.
(b) Each of the Purchasers agrees (severally and solely with
respect to itself and its purchase of Shares hereunder and its representations
and warranties hereunder) to indemnify and hold harmless the Company and each
person, if any, who controls the Company within the meaning 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 the 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 the Purchaser or on the
Purchaser's behalf specifically for use in preparation of the Registration
Statement; PROVIDED, HOWEVER, that in no event shall the Purchaser's indemnity
exceed the gross proceeds received by the Purchaser from the sale of his Shares
covered by the 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 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.
"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.
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7. MISCELLANEOUS
7.1 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.
7.2 SURVIVAL. The representations, warranties, covenants and agreements
made herein shall survive each of the Closings, for a period of four years from
the date of the last Closing to occur pursuant to this Agreement..
7.3 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.
7.4 ENTIRE AGREEMENT. This Agreement (including the Schedules 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.
7.5 AMENDMENT. This Agreement may not be amended, discharged or
terminated without the written consent of the parties hereto.
7.6 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
Attn: Xxx Xxxxxx, Chief Executive Officer
With a copy to: Xxxxxx Xxxxxxx Xxxxx & Xxxxxxx, P.A.
Bank of America Tower
Suite 3500, 000 XX 0xx Xxxxxx
Xxxxx, Xxxxxxx 00000
Attn.: Xxxxxxx X. Xxxxxxx, Esq.
If to Xxxxx X. Xxxxx XX: 00 Xxxxx Xxxxxxxxxx Xxxxxx
Xxx Xxxxxx, Xxxx 00000
If to Xxxxx X. Xxxxx III: 00 Xxxxx Xxxxxxxxxx Xxxxxx
Xxx Xxxxxx, Xxxx 00000
With a copy to: Xxxxxxxx Xxxx LLP
0000 Xxxxxxxxxx Xxxxx X.X.
Xxxxxx, Xxxx 00000
Attn: J. Xxxxxxx Xxxx, Esq.
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
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nationally recognized overnight courier service, if marked for next day delivery
or (iii) five business days after the date of mailing, if mailed.
7.7 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.
7.8 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.
7.9 BROKERS; PLACEMENT FEE. Each of the Purchasers (severally and not
jointly) hereby represents and warrants to the Company that it has not retained
a finder or broker in connection with the transactions contemplated by this
Agreement. The 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 the 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.
7.10 EXPENSES. The Company agrees to pay for reasonable legal expenses
of each of the Purchasers incurred on its behalf with respect to the
negotiation, execution and consummation of the transactions contemplated by this
Agreement. In addition to the remedies available to Purchaser hereunder, the
Company agrees to reimburse each of the Purchaser for any and all expenses,
including reasonable legal expenses, incurred as a result of any breach by the
Company of any representation, warranty or covenant contained herein.
7.11 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 there from. 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
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 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.
7.12 TITLES AND SUBTITLES. The titles of the sections and subsections
of this Agreement are for convenience of reference only and are not to be
considered in construing this Agreement.
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7.13 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. A party's execution of this Agreement (as well
as any other document relating to the transactions contemplated by this
Agreement) may be evidenced by, and a party's delivery of this Agreement (as
well as any such other document) may be effected by, facsimile transmission.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first written above.
ADVANCED VIRAL RESEARCH CORP.
By: /s/ XXX XXXXXX
-------------------------------------
Name: Xxx Xxxxxx
Title: Chief Executive Officer
PURCHASERS:
/s/ XXXXX X. XXXXX XX
-----------------------------------------
Xxxxx X. Xxxxx XX
/s/ XXXXX X. XXXXX III
-----------------------------------------
Xxxxx X. Xxxxx III
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