Exhibit 10.4
THIS WARRANT AND THE SECURITIES REPRESENTED BY THIS WARRANT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES ACT OF ANY
STATE AND MAY NOT BE SOLD OR TRANSFERRED UNLESS THERE IS AN EFFECTIVE
REGISTRATION STATEMENT UNDER SUCH ACTS COVERING THIS WARRANT AND THE
SECURITIES REPRESENTED BY THIS WARRANT OR PURSUANT TO AN EXEMPTION FROM
THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACTS.
NUWAY MEDICAL, INC.
WARRANT TO PURCHASE COMMON STOCK
Issued: July 29, 2005
WARRANT NO. AG-II
THIS CERTIFIES THAT, for value received, XXXXXXXXX XX, LLC, a limited
liability company formed under the laws of the State of Delaware (the "Holder"),
is entitled to subscribe for and purchase from NUWAY MEDICAL, INC., a
corporation organized under the laws of the state of Delaware (the "Company"),
commencing at the time periods prescribed herein and ending at 5:00 p.m.
Chicago, Illinois time on the fifth (5th) calendar anniversary of the date
hereof, 8,000,000 shares (the "Shares") of common stock, par value, $0.00067, of
the Company (the "Common Stock"). The exercise price for each Share subject to
this Warrant (the "Warrant Price") is equal to $0.005. The number of Shares and
the Warrant Price are subject to adjustment from time to time as provided in
Section 5 of this Warrant, subject in all cases to the Restricted Ownership
Percentage as provided in Section 1 of this Warrant.
This Warrant is issued in connection with and as consideration for the
extension of the Second Amended and Restated Convertible Term Note dated the
date hereof and issued by the Company in favor of the Holder, which Term Note
has been issued pursuant to that certain Amendment Number 2 to Term Loan
Agreement dated the date hereof between the Company and the Holder.
1. Method of Exercise; Payment; Issuance of New Warrant. The purchase
right represented by this Warrant may be exercised by the Holder, in whole or in
part, subject to the limitation set forth below, and from time to time, by (i)
the surrender of this Warrant (with a notice of exercise in the form attached
hereto as Exhibit A, duly executed) at the principal office of the Company and
(ii) the payment to the Company, by check or wire transfer of funds to an
account specified in writing by the Company, of an amount equal to the aggregate
Warrant Price (provided, however, this clause (ii) shall not be applicable if
the Holder is making a cashless exercise pursuant to Section 2 of this Warrant).
The Shares so purchased, representing the aggregate number of shares specified
in the executed Exhibit A, shall be delivered to the Holder within a reasonable
time, not exceeding five (5) business days, after this Warrant shall have been
so exercised. Upon receipt by the Company of this Warrant at the office of the
Company, in proper form for exercise and, unless a cashless exercise is being
made in accordance with Section 2 of this Warrant, accompanied by the amount
equal to the aggregate Warrant Price, the Holder shall be deemed to be the
holder of record of the Shares issuable upon such exercise, notwithstanding that
the stock transfer books of the Company shall then be closed or that
certificates representing such Shares shall not then be actually delivered to
the Holder.
Notwithstanding anything else herein to the contrary, the Holder
shall not have the right, and the Company shall not have the obligation, to
exercise all or any portion of this Warrant if and to the extent that the
issuance to the Holder of shares of Common Stock upon such exercise would result
in the total number of shares of Common Stock deemed beneficially owned by the
Holder (together with all shares of Common Stock deemed beneficially owned by
any of the Holder's affiliates that would be aggregated for purposes of
determining a group under Section 13(d) of the Exchange Act) exceeding, when
issued, 4.9% of the total issued and outstanding shares of the Company's Common
Stock (the "Restricted Ownership Percentage"); provided, however, that (i)
Holder shall have the right at any time and from time to time to increase or
decrease its Restricted Ownership Percentage and otherwise waive in whole or in
part the restrictions of this paragraph immediately upon written notice to the
Company, and (ii) Holder can make subsequent adjustments pursuant to the
preceding clause (i) any number of times, and provided further that nothing in
the foregoing shall prevent the partial exercise of the Warrant for such number
of shares of Common Stock as do not exceed the Restricted Ownership Percentage.
If this Warrant shall have been exercised only in part, the Company shall,
at the time of delivery of such Shares, deliver to the Holder a new Warrant
evidencing the right to purchase the remaining Shares called for by this
Warrant, which new Warrant shall in all other respects be identical with this
Warrant, or, at the request of Holder, appropriate notation may be made on this
Warrant which shall then be returned to Holder.
2. Exercise. The Holder shall pay the Warrant Price to the Company for
each Warrant that it exercises if as of the Term Loan Maturity Date (a) the
registration statement to be filed by the Company with the Securities and
Exchange Commission (the "SEC") to register the Holder's re-sale of the Common
Stock underlying the Warrant has been declared effective by the SEC; (b) the
closing bid price of the Common Stock of the Company as published in Bloomberg
for each trading day within the thirty calendar days prior to the Term Loan
Maturity Date has equaled or exceeded $0.60 per share; and (c) the volume of
trading of the Common Stock of the Company as published in Bloomberg for each
trading day within the thirty calendar days prior to the Term Loan Maturity Date
has equaled or exceeded 100,000 shares. If all of such conditions are not fully
satisfied by the Term Loan Maturity Date, then in lieu of exercising this
Warrant by payment in cash or check, the Holder may elect to pay the Warrant
Price by reducing the number of Shares issuable upon exercise of this Warrant in
accordance with the following formula:
X =Y(A-B)
--------
A
Where: X = the number of Shares to be issued to the Holder.
Y = the number of Shares requested to be exercised under this
Warrant.
A = the Fair Market Value of one (1) Share of Common Stock as of
the date such Warrant is exercised.
B = the Warrant Price.
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"Fair Market Value" of the Company's Common Stock means the average of the
closing bid prices of the Common Stock as published in Bloomberg for the ten
trading days prior to the date of determination of fair market value.
3. Stock Fully Paid; Reservation of Shares. All Shares that may be issued
upon the exercise of the rights represented by this Warrant will, upon issuance,
be fully paid and nonassessable, and free from all preemptive rights, taxes,
liens and charges with respect to the issue thereof; provided, however, that the
Company shall not be required to pay any transfer taxes with respect to the
issue of shares in any name other than that of the registered holder hereof.
During the period within which the rights represented by this Warrant may be
exercised, the Company will at all times have authorized, and reserved for the
purpose of the issue upon exercise of the purchase rights evidenced by this
Warrant, a sufficient number of shares of Common Stock to provide for the
exercise of the rights represented by this Warrant. The Company shall at all
times take all such action and obtain all such permits or orders as may be
necessary to enable the Company lawfully to issue such Common Stock as duly and
validly issued, fully paid and nonassessable shares upon exercise in full of
this Warrant.
4. Fractional Shares. No fractional shares of Common Stock will be issued
in connection with any exercise hereunder, but in lieu of such fractional shares
the Company shall make a cash payment therefor upon the basis of the Fair Market
Value of such Shares.
5. Adjustment. This Warrant shall be subject to adjustment from time to
time upon the occurrence of certain events, as follows:
(a) Adjustment for Stock Splits and Combinations. If the Company
shall at any time or from time to time after the date hereof effect a
subdivision of the outstanding Common Stock, the Warrant Price then in effect
immediately before that subdivision shall be proportionately decreased. If the
Company shall at any time or from time to time after the date hereof combine the
outstanding Common Stock, the Warrant Price then in effect immediately before
the combination shall be proportionately increased. Any adjustment under this
subsection shall become effective at the close of business on the date the
subdivision or combination becomes effective.
(b) Adjustment for Certain Dividends and Distributions. In the event
the Company at any time or from time to time after the date hereof shall make or
issue a dividend or other distribution payable in additional shares of Common
Stock, then and in each such event the Warrant Price shall be decreased as of
the time of such issuance, by multiplying the Warrant Price by a fraction:
(x) the numerator of which shall be the total number of shares of Common
Stock issued and outstanding immediately prior to the time of such
issuance; and
(y) the denominator of which shall be the total number of shares of
Common Stock issued and outstanding immediately prior to the time of
such issuance plus the number of shares of Common Stock issuable in
payment of such dividend or distribution.
(c) Adjustment of Number of Shares. Upon each adjustment of the
Warrant Price pursuant to either Section 5(a) or 5(b) of this Warrant, the
number of shares of Common Stock purchasable upon exercise of this Warrant shall
be adjusted to the number of shares of Common Stock, calculated to the nearest
one hundredth of a share, obtained by multiplying the number of shares of Common
Stock purchasable immediately prior to such adjustment upon the exercise of the
Warrant by the Warrant Price in effect prior to such adjustment and dividing the
product so obtained by the new Warrant Price.
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(d) Adjustment for Reclassification, Exchange and Substitution. If
the Common Stock issuable upon the exercise of this Warrant are changed into the
same or different number of shares of any class or classes of stock, whether by
recapitalization, reclassification or otherwise (other than a subdivision or
combination provided for in Section 5(a) above, a dividend or distribution
provided for in Section 5(b) above, or a reorganization, merger, consolidation
or sale of assets, provided for in Section 5(e) below), then and in any such
event the Holder shall have the right thereafter to exercise this Warrant into
the kind and amount of stock and other securities receivable upon such
recapitalization, reclassification or other change, by holders of the number of
shares of Common Stock for which this Warrant might have been exercised
immediately prior to such recapitalization, reclassification or change.
(e) Reorganization, Mergers, Consolidations or Sales of Assets. If
at any time or from time to time there is a capital reorganization of the Common
Stock (other than a subdivision or combination provided for in Section 5(a)
above, a dividend or distribution provided for in Section 5(b) above, or a
reclassification or exchange of shares provided for in Section 5(d) above) or a
merger or consolidation of the Company with or into another entity, or a sale of
all or substantially all of the Company's properties and assets to any other
person or entity, then, as a part of such reorganization, merger, consolidation
or sale, provision shall be made so that the Holder shall thereafter be entitled
to receive upon exercise of this Warrant the number of shares of stock or other
securities, money or property of the Company, or of the successor entity
resulting from such merger or consolidation or sale, to which a holder of Common
Stock deliverable upon conversion would have been entitled on such capital
reorganization, merger, consolidation, or sale. The Company shall not effect any
reorganization, merger, consolidation or sale unless prior to the consummation
thereof each entity or person (other than the Company) that may be required to
deliver any cash, securities or other property upon the exercise of this Warrant
shall assume, by written instrument delivered to the Holder, the obligation to
deliver to the Holder such cash, securities or other property as in accordance
with the foregoing provisions the Holder may be entitled to receive. The
foregoing provisions of this Section 5(e) shall similarly apply to successive
reorganizations, mergers, consolidations and sales.
(f) Adjustment of Warrant Price for Matching Purposes. In the event
that the Company shall issue Common Stock or rights, warrants, options or
convertible or exchangeable securities entitling the holder thereof to subscribe
for or purchase, convert or exercise into or exchange for Common Stock, in any
such case at a price (the "Dilutive Strike Price") per share less than $0.035
("Dilutive Securities"), then the Warrant Price in effect immediately prior to
such earliest date shall be adjusted so that the Warrant Price shall equal the
price determined by multiplying the Warrant Price in effect immediately prior to
such earliest date by the fraction:
(i) whose numerator shall be the number of shares of Common Stock
outstanding on such date plus the number of shares which the aggregate
offering price of the total number of shares so offered would purchase at
the then applicable Warrant Price (such amount, with respect to any such
Dilutive Securities determined by multiplying the total number of shares
subject thereto by the Dilutive Strike Price and dividing the product so
obtained by the then applicable Warrant Price), and
(ii) whose denominator shall be the number of shares of Common Stock
outstanding on such date plus the number of additional shares of Common
Stock to be issued or distributed or receivable upon exercise of any such
Dilutive Securities.
Such adjustment shall be made successively whenever any such Dilutive Securities
are issued or distributed. In determining whether any Dilutive Securities
entitle the holders to subscribe for or purchase shares of Common Stock at less
than $0.035, and in determining the aggregate offering price of shares of Common
Stock so issued or distributed, there shall be taken into account any
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consideration received by the Company for such Dilutive Securities. If any
Dilutive Securities to purchase or acquire Common Stock, the issuance of which
resulted in an adjustment in the Warrant Price pursuant to this Section 5(f)
shall expire and shall not have been exercised, the Warrant Price shall
immediately upon such expiration be recomputed to the Warrant Price which would
have been in effect had the adjustment of the Warrant Price made upon the
issuance of such Dilutive Securities been made on the basis of offering for
subscription, purchase or issuance, as the case may be, only of that number of
shares of Common Stock actually purchased or issued upon the actual exercise of
such Dilutive Securities.
(g) Exceptions to Adjustment. Notwithstanding the provisions of
Section 5(f):
(i) No adjustment in the Warrant Price shall be required
unless the adjustment would require an increase or decrease of at least 1% in
the Warrant Price then in effect; provided, however, that any adjustments that
by reason of this subparagraph (g)(i) are not required to be made shall be
carried forward and taken into account in any subsequent adjustment. All
calculations under this subparagraph shall be made to the nearest cent or
nearest 1/100th of a share.
(ii) Upon the sale or issuance of any Dilutive Securities as
compensation to officers, directors, employees or consultants of the Company
other than pursuant to compensation or incentive plans existing as of the date
of this Warrant, then the Warrant Price shall be automatically adjusted, for an
equivalent number of Shares equal to all such compensatory Dilutive Securities,
to be equal to the lowest Dilutive Strike Price of all such compensatory
Dilutive Securities. By way of illustration, if compensatory Dilutive Securities
to purchase 1,000 shares of Common Stock are issued to various persons at Strike
Prices of $0.01, $.02 and $0.025, this Warrant shall be adjusted so as to
provide the Holder with the right to purchase 1,000 shares of Common Stock at
$0.01 per share.
(iii) Upon the sale or issuance of any Dilutive Securities in
connection with capital investment into the Company, or debt financings or
refinancings, then the Warrant Price shall be automatically adjusted to be equal
to the lowest Dilutive Strike Price of all such Dilutive Securities. The parties
intend that any Dilutive Securities sold or issued to placement agents, finders,
brokers, underwriters and the like as compensation for their assistance with
respect to any such transaction are intended to be governed by this provisions
of this subparagraph (g)(iii) rather than the provisions of subparagraph
5(g)(ii).
(iv) Notwithstanding anything to the contrary set forth in
this Section 5(f), no adjustment shall be made to the Warrant Price upon the
issuance of Common Stock upon the conversion or exercise of the options,
warrants or rights of the Company outstanding as of the date hereof.
(h) No Impairment. The Company will not, by amendment of its
Articles 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 to be observed or performed hereunder by the Company but will at all
times in good faith assist in the carrying out of all the provisions of this
Section and in the taking of all such action as may be necessary or appropriate
in order to protect the conversion rights of the Holder against dilution or
other impairment. Without limiting the generality of the foregoing, the Company
will not issue any capital stock of any class which is preferred as to dividends
or as to the distribution of assets upon the voluntary or involuntary
dissolution, liquidation or winding up of the Company.
(i) Notice of Adjustments. Whenever this Warrant shall be adjusted
pursuant to this Section 5, the Company shall make a certificate signed by an
officer of the Company setting forth, in reasonable detail, the event requiring
the adjustment, the amount of the adjustment, the method by which such
5
adjustment was calculated, and the new Warrant Price and the type or the number
of Shares purchasable after giving effect to such adjustment, and shall cause
copies of such certificate to be mailed (by first class mail, postage prepaid)
to the Holder.
6. The Company's Obligation to Make Payments.
(a) Dividends and Distributions. In the event the Company at any
time or from time to time after the date hereof shall make or issue a dividend
or other distribution, whether payable in cash, securities or other property of
the Company, with respect to any of its capital stock for which an adjustment is
not made pursuant to Section 5 of this Warrant, then and in each such event, the
Company shall concurrently make a cash payment to the Holder equal to the
product of (i) the quotient obtained by dividing (x) the amount of cash plus the
fair value of any property or securities distributed by (y) the number of shares
of Common Stock outstanding on the record date for such dividend or distribution
and (ii) the number of Shares on such record date.
(b) Redemption of Capital Stock. In the event the Company at any
time or from time to time after the date hereof shall repurchase or redeem any
of its capital stock or any rights, including without limitation, options,
warrants or other convertible or exchangeable securities, to acquire such
capital stock, then and in each such event, the Company shall concurrently make
a cash payment to the Holder equal to the product of (i) the quotient obtained
by dividing (x) the aggregate amount of cash and the aggregate fair value of any
property paid out by the Company in connection with any such repurchase or
redemption by (y) the number of shares of Common Stock outstanding on a fully
diluted basis immediately after such repurchase or redemption and (2) the number
of Shares.
7. Notice of Record Date. In the event:
(1) that the Company declares a dividend (or any other
distribution) on any of its capital stock (including without
limitation, its Common Stock);
(2) that the Company repurchases or redeems any of its capital
stock (including without limitation, its Common Stock) or any
rights to acquire such capital stock;
(3) that the Company subdivides or combines its outstanding shares
of Common Stock;
(4) of any reclassification of the Common Stock, or of any
consolidation, merger or share exchange of the Company into or
with another entity, or of the sale of all or substantially
all of the assets of the Company;
(5) of the involuntary or voluntary dissolution, liquidation or
winding up of the Company; or
(6) of any offer of its Common Stock or any rights to acquire such
Common Stock for consideration paid per share of Common Stock
less than the Warrant Price then in effect.
then the Company shall notify the Holder at least 30 days prior to the date
specified in (A), (B) or (C) below, in writing stating:
(A) the record date of such dividend, distribution, repurchase,
redemption, subdivision or combination, or, if a record is not to be
6
taken, the date as to which the holders of Common Stock of record to be
entitled to such dividend, distribution, repurchase, redemption,
subdivision or combination are to be determined;
(B) the date on which such reclassification, consolidation, merger,
share exchange, sale, dissolution, liquidation or winding up is expected
to become effective, and the date as of which it is expected that holders
of Common Stock of record shall be entitled to exchange their shares of
Common Stock for securities or other property deliverable upon such
reclassification, consolidation, merger, sale, dissolution or winding up;
or
(C) the date on which such offering of its Common Stock or any
rights to acquire such Common Stock for consideration paid per share of
Common Stock less than the Warrant Price is expected to become
consummated.
8. Compliance with Securities Act; Disposition of Warrant or Common Stock.
(a) Compliance with Securities Act. The Holder, by acceptance
hereof, agrees that this Warrant and the Shares to be issued upon exercise
hereof are being acquired for investment and that such Holder will not offer,
sell or otherwise dispose of this Warrant or any Common Stock to be issued upon
exercise hereof except under circumstances which will not result in a violation
of the Securities Act of 1933, as amended (the "Act"). All Shares issued upon
exercise of this Warrant (unless registered under the Act or sold or transferred
pursuant to Rule 144 promulgated under the Act) shall be stamped or imprinted
with a legend in substantially the following form:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR
THE SECURITIES ACTS OF ANY STATE AND MAY NOT BE SOLD OR TRANSFERRED UNLESS
THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACTS COVERING THIS
SECURITY OR PURSUANT TO AN EXEMPTION FROM THE REGISTRATION AND PROSPECTUS
DELIVERY REQUIREMENTS OF SUCH ACTS."
(b) Disposition of Warrant or Shares. Subject to the terms and
conditions of this Warrant and applicable securities laws, this Warrant and the
rights represented by this Warrant may be transferred, assigned or pledged, in
whole or in part with prior written notice to the Company. Any transfer shall be
accompanied by the Notice of Transfer form attached hereto as Exhibit B.
9. Rights as Shareholders. The Holder shall not, by virtue hereof, be
entitled to any rights of a shareholder in the Company, either at law or equity,
and the rights of the Holder are limited to those expressed in this Warrant and
are not enforceable against the Company except to the extent set forth herein.
10. Representations and Warranties. The Company represents and warrants to
the Holder as follows:
(a) This Warrant has been duly authorized and executed by the
Company and is a valid and binding obligation of the Company enforceable in
accordance with its terms;
(b) The Shares have been duly authorized and reserved for issuance
by the Company and, when issued in accordance with the terms hereof, will be
validly issued, fully paid and nonassessable;
(c) The rights, preferences, privileges and restrictions granted to
or imposed upon the Shares and the holders thereof are as set forth in the
Company's Articles of Incorporation;
7
(d) The execution and delivery of this Warrant are not, and the
issuance of the Shares upon exercise of this Warrant in accordance with the
terms hereof will not be, inconsistent with the Company's Articles of
Incorporation or by-laws, do not and will not contravene any law, governmental
rule or regulation, judgment or order applicable to the Company, and, except for
consents that have already been obtained by the Company, do not and will not
conflict with or contravene any provision of, or constitute a default under, any
indenture, mortgage, contract or other instrument of which the Company is a
party or by which it is bound or require the consent or approval of, the giving
of notice to, the registration with or the taking of any action in respect of or
by, any federal, state or local government authority or agency or other person;
and
(e) Capitalization. As of the date of this Warrant the
capitalization of the Company is as follows:
(i) Common Stock. A total of 100,000,000 authorized shares of Common
Stock, of which approximately 55,000,000 shares were issued and
outstanding. All of such outstanding shares are validly issued,
fully paid and non-assessable. No shares of the Common Stock are
held in the Company's treasury.
(ii) Preferred Stock. A total of 25,000,000 authorized shares of
Preferred Stock, of which 559,322 shares were issued and
outstanding.
(iii) Options, Warrants, Reserved Shares. Except as disclosed in the
Form 10-KSB for the period ended December 31, 2004 filed by the
Company, and any subsequent reports filed with the SEC, there are no
outstanding options, warrants, rights (including conversion or
preemptive rights) or agreements for the purchase or acquisition
from the Company of any shares of its capital stock or any
securities convertible into or ultimately exchangeable or
exercisable for any shares of the Company's capital stock. No shares
of the Company's outstanding capital stock, or stock issuable upon
exercise, conversion or exchange of any outstanding options,
warrants or rights, or other stock issuable by the Company, are
subject to any rights of first refusal or other rights to purchase
such stock (whether in favor of the Company or any other person),
pursuant to any agreement, commitment or other obligation of the
Company.
11. Registration Rights. If the Company proposes to file any registration
statement under the Act (other than Form S-8), with respect to an offering of
any equity securities, then the Company shall give the Holder written notice of
such proposed filing as soon as practicable (but in no event less than thirty
(30) days before the anticipated initial filing date of such registration
statement), and such notice shall offer the Holder the opportunity to register
such number of Shares as the Holder shall request (the "Piggyback Shares"). The
Company shall bear all costs of registering the Piggyback Shares, except for
underwriting discounts or commissions if the registration statement relates to
an underwritten offering. Any registration rights granted by this paragraph
expire when shares issued pursuant to this Warrant Agreement are eligible for
sale under Rule 144(k) of the Securities Act of 1933.
12. Modification and Waiver. This Warrant and any provision hereof may be
changed, waived, discharged or terminated only by an instrument in writing
signed by the party against which enforcement of the same is sought.
13. Notices. Except as otherwise expressly provided herein, all notices
and other communications provided for hereunder shall be in writing (including
telegraphic, telex, telecopier or cable communication) and mailed, telegraphed,
telexed, telecopied, cabled or delivered to the applicable party at its address
8
specified opposite its signature below, or at such other address as shall be
designated by such party in a written notice to the other. All such notices and
communications shall, when mailed, telegraphed, telexed, telecopied or cabled or
sent by overnight courier, be effective when deposited in the mails, delivered
to the telegraph company, cable company or overnight courier, as the case may
be, or sent by telex or telecopier.
14. Descriptive Headings. The descriptive headings of the several sections
of this Warrant are inserted for convenience only and do not constitute a part
of this Warrant.
15. Governing Law. THIS WARRANT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF ILLINOIS.
16. Binding Effect on Successors. This Warrant shall be binding upon any
entity succeeding the Company by merger, consolidation or acquisition of all or
substantially all of the Company's assets, and all of the obligations of the
Company relating to the Common Stock issuable upon the exercise of this Warrant
shall survive the exercise, and termination of this Warrant and all of the
covenants and agreements of the Company shall inure to the benefit of the
successors and assigns of the Holder.
17. Severability. In case any one or more of the provisions contained in
this Warrant shall be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby. The parties shall
endeavor in good faith negotiations to replace the invalid, illegal or
unenforceable provisions with valid provisions, the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.
18. Lost Warrants or Stock Certificates. The Company covenants to the
Holder that upon receipt of evidence reasonably satisfactory to the Company of
the loss, theft, destruction, or mutilation of this Warrant or any stock
certificate and, in the case of any such loss, theft or destruction, upon
receipt of an indemnity reasonably satisfactory to the Company, or in the case
of any such mutilation upon surrender and cancellation of such Warrant or stock
certificate, the Company will make and deliver a new Warrant or stock
certificate, of like tenor, in lieu of the lost, stolen, destroyed or mutilated
Warrant or stock certificate.
[Signature Page Follows]
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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed and
delivered by its duly authorized officer on the day and year first above
written.
NUWAY MEDICAL, INC.
By: /s/ Xxxxxx Xxxxxxx
Name: Xxxxxx Xxxxxxx, President
Address: 0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx Xxxxxxx
Facsimile: 000 000-0000
ACKNOWLEDGED AND ACCEPTED:
XXXXXXXXX XX, LLC
By: AUGUSTINE CAPITAL
MANAGEMENT, L.L.C., its manager
By: /s/Xxxxxx X. Xxxxxxxxx
---------------------------
Xxxxxx X. Xxxxxxxxx
Member and Authorized Officer
Address: 000 Xxxx Xxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxxxx
Facsimile: (000) 000-0000
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EXHIBIT A
NOTICE OF EXERCISE
TO: NUWAY MEDICAL, INC.
(1) The undersigned hereby elects to purchase __________ shares of Common
Stock of NUWAY MEDICAL, INC. pursuant to the terms of the attached Warrant, and,
unless such Warrant allows the exercise to be "cashless," tenders herewith
payment of the Warrant Price for such shares in full.
(2) Please issue a certificate or certificates representing said shares of
Common Stock in the name of the undersigned or in such other name as is
specified below:
---------------------------------
(Name)
---------------------------------
(Name)
(3) Please issue a new Warrant for the unexercised portion of the attached
Warrant in the name of the undersigned or in such other name as is specified
below:
---------------------------------
(Name)
---------------------------------
(Address)
---------------------------------
(Signature)
---------------------------------
(Date)
EXHIBIT B
NOTICE OF TRANSFER
(To be signed only upon transfer of Warrant)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto ____________________________________________ the right represented by the
attached Warrant to purchase __________ shares of the Common Stock of NUWAY
MEDICAL, INC., to which the attached Warrant relates, and appoints
_____________________ as Attorney to transfer such right on the books of NUWAY
MEDICAL, INC., with full power of substitution in the premises.
Dated:
------------------------
---------------------------------------
(Signature must conform in all respects
to the name of the Holder as specified
on the face of the Warrant)
---------------------------------------
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(Address)
Signed in the presence of:
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