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VIRAGEN, INC.
REGULATION D SUBSCRIPTION AGREEMENT
THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED WITH THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE OR OTHER SECURITIES
AUTHORITIES. THEY MAY NOT BE SOLD OR TRANSFERRED EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT OR AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THOSE SECURITIES LAWS.
THIS SUBSCRIPTION AGREEMENT DOES NOT CONSTITUTE AN OFFER TO SELL, OR A
SOLICITATION OF AN OFFER TO PURCHASE, ANY OF THE SECURITIES DESCRIBED
HEREIN BY OR TO ANY PERSON IN ANY JURISDICTION IN WHICH SUCH OFFER OR
SOLICITATION WOULD BE UNLAWFUL. THESE SECURITIES HAVE NOT BEEN
RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES AUTHORITIES, NOR HAVE
SUCH AUTHORITIES REVIEWED OR DETERMINED THE ACCURACY OF THIS DOCUMENT.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
AN INVESTMENT IN THESE SECURITIES INVOLVES A HIGH DEGREE OF RISK.
SUBSCRIBERS MUST RELY ON THEIR OWN ANALYSIS OF THE INVESTMENT AND
ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET FORTH IN THE
ATTACHED DISCLOSURE DOCUMENTS AS EXHIBIT H.
SEE ADDITIONAL LEGENDS AT SECTIONS 3.7 and 9.
THIS REGULATION D SUBSCRIPTION AGREEMENT (this "Agreement") is made as
of the _____ day of February, 1998, by and between Viragen, Inc., a corporation
duly organized and existing under the laws of the State of Delaware (the
"Company"), and the undersigned subscriber executing this Agreement
("Subscriber").
THE PARTIES HEREBY AGREE AS FOLLOWS:
This Agreement is executed by Subscriber in connection with the offer
by the Company and the purchase by Subscriber of Series H Preferred Stock, $.01
par value (the "Preferred Stock"), of the Company. The Preferred Stock is being
offered at a purchase price of Ten Thousand Dollars ($10,000), U.S., per share,
in minimum subscription amounts of at least twenty five(25) shares ($250,000),
and increments of five (5) shares ($50,000) in excess thereof, with an aggregate
offering amount of Five Hundred (500) shares of Preferred Stock, or Five Million
Dollars ($5,000,000) (the "Offering Amount"), (collectively, the "Offering").
The terms of the Preferred Stock, including the terms on which the Preferred
Stock may be converted into common stock, $.01 par value, of the Company (the
"Common Stock"), are set forth in the Certificate of Designation of Series H
Preferred Stock (the "Certificate of Designation"), substantially in the form
attached hereto as Exhibit A. The Preferred Stock is accompanied by (i) a
warrant or warrants to purchase a number of shares of Common Stock of the
Company equal to ten percent (10%) multiplied by the aggregate purchase price of
the Subscriber's Preferred Stock outstanding on the date which is nine (9)
months following the closing hereunder (the "Nine Month Date") divided by the
Market Price of the Common Stock on the Nine Month Date (the "Nine Month
Warrants"); (ii) a warrant or warrants to purchase a number of shares of Common
Stock of the Company equal to fifteen percent (15%) multiplied by the aggregate
purchase price of the Subscriber's Preferred
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Stock outstanding on the date which is twelve (12) months following the closing
hereunder (the "Twelve Month Date") divided by the Market Price of the Common
Stock on the Twelve Month Date (the "Twelve Month Warrants"); and (iii) a
warrant or warrants to purchase a number of shares of Common Stock of the
Company equal to twenty percent (20%) multiplied by the aggregate purchase price
of the Subscriber's Preferred Stock outstanding on the date which is fifteen
(15) months following the closing hereunder (the "Fifteen Month Date") divided
by the Market Price of the Common Stock on the Fifteen Month Date (the "Fifteen
Month Warrants", together with the Nine Month Warrants and the Twelve Month
Warrants, collectively referred to as the "Conversion Warrants"). The terms of
the Warrants are set forth in the form of the Nine Month, Twelve Month and
Fifteen Month Warrants attached hereto as Exhibit B, Exhibit C, and Exhibit D,
respectively. For purposes hereof, "Market Price" shall equal the average of the
two (2) lowest Closing Bid Prices (as that term is defined in the Certificate of
Designation) for the twenty (20) trading days immediately preceding the date in
question. The solicitation of this subscription and, if accepted by the Company,
the offer and sale of the Preferred Stock are being made in reliance upon the
provisions of Regulation D ("Regulation D") promulgated under the Securities Act
of 1933, as amended ("the Act"). The Preferred Stock and the Common Stock
issuable upon conversion thereof (the "Conversion Shares"), together with the
Conversion Warrants and the Common Stock issuable upon exercise thereof (the
"Warrant Shares") are sometimes referred to herein singularly as "Security" and
collectively as the "Securities."
It is agreed as follows:
1. Offering
1.1 Offer to Subscribe; Purchase Price and Closing; and
Placement Fees.
Subject to satisfaction of the conditions to closing set forth in Section 1.2
below, Subscriber hereby offers to subscribe for and purchase Preferred Stock
and accompanying Conversion Warrants, for the aggregate purchase price in the
amount set forth in Section 10 of this Agreement, in accordance with the terms
and conditions of this Agreement. Assuming that the Offering Amount and
corresponding subscription agreements accepted by the Company are received into
the Company's designated escrow account for this Offering established pursuant
to the Escrow Agreement and Instructions (the "Escrow Agreement") by and among
the Company, First Union National Bank of Georgia (the "Escrow Agent") and the
Placement Agent (as defined below) (the "Escrow Account"), the closing of a sale
and purchase of Preferred Stock as to each Subscriber (the "Closing") shall be
deemed to occur when this Agreement has been executed by both Subscriber and the
Company and full payment shall have been made by Subscriber, by wire transfer to
the Escrow Account as set forth in Section 7.1(a) for payment in consideration
for the Company's delivery of certificates representing the Preferred Stock
subscribed for.
The parties hereto acknowledge that ▇▇▇▇▇▇ Investments, LLC is acting as
placement agent (the "Placement Agent") for this Offering and will be
compensated by the Company in cash and warrants to purchase Common Stock. The
Placement Agent has acted solely as placement agent in connection with the
Offering by the Company of the Preferred Stock pursuant to this Agreement. The
information and data contained in the Disclosure Documents (as defined in
Section 2.2.4) have not been subjected to independent verification by the
Placement Agent, and no representation or warranty is made by the Placement
Agent as to the accuracy or completeness of the information contained in the
Disclosure Documents.
1.2 Conditions to Subscriber's Obligations. Subscriber's
obligations hereunder are conditioned upon all of the following:
(a) the following documents shall have been deposited
with the Escrow Agent: the Registration Rights
Agreement, substantially in the form attached hereto
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as Exhibit E (the "Registration Rights Agreement")
(executed by the Company), an opinion of counsel,
substantially in the form attached hereto as Exhibit
F (the "Opinion of Counsel") (signed by the Company's
counsel), the Irrevocable Instructions to Transfer
Agent, substantially in the form attached hereto as
Exhibit G (the "Irrevocable Instructions to Transfer
Agent")(executed by the Company and the Company's
transfer agent, the "Transfer Agent"), and the
Certificate of Designation, substantially in the form
attached hereto as Exhibit A (together with evidence
showing that it has been filed with the Secretary of
State of Delaware); certificates representing the
Preferred Stock issued in the name of the Subscriber;
the Conversion Warrants issued in the name of the
Subscriber;
(b) the Company's Common Stock shall be listed for and
actively trading on the Nasdaq National Market
System;
(c) other than losses described in the Risk Factors as
set forth in Section 2.2.4 below there have been no
material adverse changes in the Company's business
prospects or financial condition since the date of
the last balance sheet included in the Disclosure
Documents (defined below in Section 2.2.4), including
but not limited to incurring material liabilities;
(d) the representations and warranties of the Company are
true and correct in all material respects at the
Closing as if made on such date, and the Company
shall deliver a certificate, signed by an officer of
the Company, to such effect to the Escrow Agent;
(e) the Offering Amount and corresponding subscription
agreements accepted by the Company shall have been
received by the Escrow Agent; and
(f) the Company shall have reserved for issuance a
sufficient number of shares of Common Stock to effect
conversions of the Preferred Stock and exercise of
the Conversion Warrants, which number of shares shall
initially be equal to Seven Million Two Hundred
Thousand (7,200,000) shares.
2. Representations and Warranties of Subscriber. Subscriber hereby
represents and warrants to the Company as follows:
2.1 Accredited Investor. Subscriber is an accredited investor, as
defined in Rule 501 of Regulation D, and has checked the applicable box set
forth in Section 10 of this Agreement.
2.2 Investment Experience; Access to Information; Independent
Investigation.
2.2.1 Access to Information. Subscriber or Subscriber's
professional advisor has been granted the opportunity to ask questions of and
receive answers from representatives of the Company, its officers, directors,
employees and agents concerning the terms and conditions of this Offering, the
Company and its business and prospects, and to obtain any additional information
which Subscriber or Subscriber's professional advisor deems necessary to verify
the accuracy and completeness of the information received.
2.2.2 Reliance on Own Advisors. Subscriber has relied completely
on the advice of, or has consulted with, Subscriber's own personal tax,
investment, legal or other advisors and has not relied on the Company or any of
its affiliates, officers, directors, attorneys, accountants or any affiliates of
any thereof and each other person, if any, who controls any thereof, within the
meaning of Section 15 of the Act for any tax or legal advice (other than
reliance
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on information in the Disclosure Documents as defined in Section 2.2.4
below and on the Opinion of Counsel). The foregoing, however, does not limit or
modify Subscriber's right to rely upon representations and warranties of the
Company in Section 4 of this Agreement.
2.2.3 Capability to Evaluate. Subscriber has such knowledge and
experience in financial and business matters so as to enable such Subscriber to
utilize the information made available to it in connection with the Offering in
order to evaluate the merits and risks of the prospective investment, which are
substantial, including without limitation those set forth in the Disclosure
Documents (as defined in Section 2.2.4 below).
2.2.4 Disclosure Documents. Subscriber, in making Subscriber's
investment decision to subscribe for the Securities hereunder, represents that
(a) Subscriber has received and had an opportunity to review (i) the Company's
Annual Report on Form 10-K for the year ended June 30, 1997 (ii) the Company's
quarterly report on Form 10-Q for the quarter ended December 31, 1997, (iii) the
Risk Factors, attached as Exhibit H, (iv) the Capitalization Schedule, attached
as Exhibit I, (the "Capitalization Schedule") and (v) the Use of Proceeds
Schedule, attached as Exhibit J, (the "Use of Proceeds Schedule") (b) Subscriber
has read, reviewed, and relied solely on the documents described in (a) above,
the Company's representations and warranties and other information in this
Agreement, including the exhibits, any other written information prepared by the
Company which has been specifically provided to Subscriber in connection with
this Offering (the documents described in Section 2.2.4 (a) and (b) are
collectively referred to as the "Disclosure Documents"), and an independent
investigation made by Subscriber and Subscriber's representatives, if any; (c)
Subscriber has, prior to the date of this Agreement, been given an opportunity
to review material contracts and documents of the Company which have been filed
as exhibits to the Company's filings under the Act and the Securities Exchange
Act of 1934, as amended (the "Exchange Act") and has had an opportunity to ask
questions of and receive answers from the Company's officers and directors; and
(d) is not relying on any oral representation of the Company or any other
person, nor any written representation or assurance from the Company other than
those referred to in Section 4 or otherwise contained in the Disclosure
Documents or incorporated herein or therein. The foregoing, however, does not
limit or modify Subscriber's right to rely upon representations and warranties
of the Company in Section 4 of this Agreement. Subscriber acknowledges and
agrees that the Company has no responsibility for, does not ratify, and is under
no responsibility whatsoever to comment upon or correct any reports, analyses or
other comments made about the Company by any third parties, including, but not
limited to, analysts' research reports or comments (collectively, "Third Party
Reports"), and Subscriber has not relied upon any Third Party Reports, including
any provided by the Placement Agent, in making the decision to invest.
2.2.5 Investment Experience; Fend for Self. Subscriber has
substantial experience in investing in securities and he, she or it has made
investments in securities other than those of the Company. Subscriber
acknowledges that Subscriber is able to fend for Subscriber's self in the
transaction contemplated by this Agreement, that Subscriber has the ability to
bear the economic risk of Subscriber's investment pursuant to this Agreement and
that Subscriber is an "Accredited Investor" by virtue of the fact that
Subscriber meets the investor qualification standards set forth in Section 2.1
above. Subscriber has not been organized for the purpose of investing in
securities of the Company, although such investment is consistent with
Subscriber's purposes.
2.3 Exempt Offering Under Regulation D.
2.3.1 Investment; No Distribution. Subscriber is acquiring the
Securities to be issued and sold hereunder for his, her or its own account (or a
trust account if such Subscriber is a trustee) for investment and not as a
nominee and not with a present view to the distribution thereof. Subscriber is
aware that there are legal and practical limits on Subscriber's ability to sell
or dispose of the Securities and, therefore, that Subscriber must bear the
economic
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risk of the investment for an indefinite period of time and has adequate means
of providing for Subscriber's current needs and possible personal contingencies
and has need for only limited liquidity of this investment. Subscriber's
commitment to illiquid investments is reasonable in relation to Subscriber's net
worth. By making the representations in this Section 2.3.1, the Subscriber does
not agree to hold the Securities for any minimum or other specific term and
reserves the right to dispose of the Securities at any time in accordance with
or pursuant to a registration statement or an exemption from registration under
the Act, except as otherwise required in this Agreement or in the Registration
Rights Agreement. Subscriber has reached the age of majority (if an individual)
according to the laws of the state in which he resides.
2.3.2 No General Solicitation. The Securities were not offered
to Subscriber through, and Subscriber is not aware of, any form of general
solicitation or general advertising, including, without limitation, (i) any
advertisement, article, notice or other communication published in any
newspaper, magazine or similar media or broadcast over television or radio, and
(ii) any seminar or meeting whose attendees have been invited by any general
solicitation or general advertising.
2.3.3 Restricted Securities. Subscriber understands that the
Preferred Stock and the Conversion Warrants issued at Closing are, and the
Conversion Shares and the Warrant Shares will be, characterized as "restricted
securities" under the federal securities laws inasmuch as they are being
acquired from the Company in a transaction not involving a public offering and
that under such laws and applicable regulations such securities may not be
transferred or resold without registration under the Act or pursuant to an
exemption therefrom. In this connection, Subscriber represents that Subscriber
is familiar with Rule 144 under the Act, as presently in effect, and understands
the resale limitations imposed thereby and by the Act.
2.3.4 Disposition. Without in any way limiting the
representations set forth above, Subscriber further agrees not to make any
disposition of all or any portion of the Securities unless and until:
(a) There is then in effect a registration statement under
the Act covering such proposed disposition and such disposition is made in
accordance with such registration statement; or
(b) (i) Subscriber shall have notified the Company of the
proposed disposition and shall have furnished the Company with a detailed
statement of the circumstances surrounding the proposed disposition, and (ii) if
reasonably requested by the Company, Subscriber shall have furnished the Company
with an opinion of counsel, reasonably satisfactory to the Company, that such
disposition will not require registration of the Securities under the Act. It is
agreed that the Company will not require opinions of counsel for transactions
made pursuant to Rule 144 except in unusual circumstances.
2.4 Due Authorization.
2.4.1 Authority. Subscriber, if executing this Agreement in a
representative or fiduciary capacity, has full power and authority to execute
and deliver this Agreement and each other document included herein for which a
signature is required in such capacity and on behalf of the subscribing
individual, partnership, trust, estate, corporation or other entity for whom or
which Subscriber is executing this Agreement.
2.4.2 Due Authorization. If Subscriber is a corporation,
Subscriber is duly and validly organized, validly existing and in good tax and
corporate standing as a corporation under the laws of the jurisdiction of its
incorporation with full power and authority to purchase the Securities to be
purchased by Subscriber and to execute and deliver this Agreement.
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2.4.3 Partnerships. If Subscriber is a partnership, the
representations, warranties, agreements and understandings set forth above are
true with respect to all partners of Subscriber (and if any such partner is
itself a partnership, all persons holding an interest in such partnership,
directly or indirectly, including through one or more partnerships), and the
person executing this Agreement has made due inquiry to determine the
truthfulness of the representations and warranties made hereby.
2.4.4 Representatives. If Subscriber is purchasing in a
representative or fiduciary capacity, the representations and warranties shall
be deemed to have been made on behalf of the person or persons for whom
Subscriber is so purchasing.
2.4 Subscriber's Broker/Dealer Status. Subscriber is not a
licensed NASD broker-dealer and does not engage in the business of a
broker-dealer.
3. Acknowledgments Subscriber is aware that:
3.1 Risks of Investment. Subscriber recognizes that an investment in
the Company involves substantial risks, including the potential loss of
Subscriber's entire investment herein. Subscriber recognizes that this Agreement
and the exhibits hereto do not purport to contain all the information which
would be contained in a registration statement under the Act;
3.2 No Government Approval. No federal or state agency has passed
upon the Securities, recommended or endorsed the Offering, or made any finding
or determination as to the fairness of this transaction;
3.3 No Registration. The Securities and any component thereof have
not been registered under the Act or any applicable state securities laws by
reason of exemptions from the registration requirements of the Act and such
laws, and may not be sold, pledged, assigned or otherwise disposed of in the
absence of an effective registration of the Securities and any component thereof
under the Act or unless an exemption from such registration is available;
3.4 Restrictions on Transfer. Subscriber may not attempt to sell,
transfer, assign, pledge or otherwise dispose of all or any portion of the
Securities or any component thereof in the absence of either an effective
registration statement or an exemption from the registration requirements of the
Act and applicable state securities laws;
3.5 No Assurances of Registration. There can be no assurance that any
registration statement will become effective at the scheduled time. Therefore,
Subscriber may bear the economic risk of Subscriber's investment for an
indefinite period of time;
3.6 Exempt Transaction. Subscriber understands that the Securities
are being offered and sold in reliance on specific exemptions from the
registration requirements of federal and state law and that the representations,
warranties, agreements, acknowledgments and understandings set forth herein are
being relied upon by the Company in determining the applicability of such
exemptions and the suitability of Subscriber to acquire such Securities;
3.7 Legends. It is understood that the certificates evidencing the
Preferred Stock, the Conversion Warrants, the Conversion Shares and the Warrant
Shares shall bear the following legend (the "Legend") (prior to registration as
provided in Section 5.3):
"The securities represented hereby have not been registered
under the Securities Act of 1933, as amended, or applicable
state securities laws, nor the securities laws of any other
jurisdiction. They may not be sold or transferred in the
absence of an
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effective registration statement under those securities laws
or pursuant to an exemption therefrom."
4. Representations and Warranties of the Company . The Company hereby
makes the following representations and warranties to Subscriber (which shall be
true at the signing of this Agreement, as of Closing, and as of any such later
date as contemplated hereunder) and agrees with Subscriber that:
4.1 Organization, Good Standing, and Qualification. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware USA and has all requisite corporate power and authority
to carry on its business as now conducted and as proposed to be conducted. The
Company is duly qualified to transact business and is in good standing in each
jurisdiction in which the failure to so qualify would have a material adverse
effect on the business or properties of the Company and its subsidiaries taken
as a whole. The Company is not the subject of any pending, threatened or, to its
knowledge, contemplated investigation or administrative or legal proceeding by
the Internal Revenue Service, the taxing authorities of any state or local
jurisdiction, or the Securities and Exchange Commission ("SEC"), or any state
securities commission, or any other governmental entity, which have not been
disclosed in the Disclosure Documents.
4.2 Corporate Condition. The Company's condition is, in all material
respects, as described in the Disclosure Documents, except for changes in the
ordinary course of business and normal year-end adjustments that are not, in the
aggregate, materially adverse to the Company. There have been no material
adverse changes to the Company's business, financial condition, or prospects
since the date of such Disclosure Documents. The financial statements contained
in the Disclosure Documents have been prepared in accordance with generally
accepted accounting principles, consistently applied (except as otherwise
permitted by Regulation S-X of the Exchange Act), and fairly present the
consolidated financial condition of the Company as of the dates of the balance
sheets included therein and the consolidated results of its operations and cash
flows for the periods then ended. Without limiting the foregoing, there are no
material liabilities, contingent or actual, that are not disclosed in the
Disclosure Documents (other than liabilities incurred by the Company in the
ordinary course of its business, consistent with its past practice, after the
period covered by the Disclosure Documents). The Company has paid all material
taxes which are due, except for taxes which it reasonably disputes. There is no
material claim, litigation, or administrative proceeding pending, or, to the
best of the Company's knowledge, threatened against the Company, except as
disclosed in the Disclosure Documents. This Agreement and the Disclosure
Documents do not contain any untrue statement of a material fact and do not omit
to state any material fact required to be stated therein or herein necessary to
make the statements contained therein or herein not misleading in the light of
the circumstances under which they were made. No event or circumstance exists
relating to the Company which, under applicable law, requires public disclosure
but which has not been so publicly announced or disclosed.
4.3 Authorization. Except for the filing of the Certificate of
Designation, all corporate action on the part of the Company by its officers,
directors and shareholders necessary for the authorization, execution and
delivery of this Agreement, the performance of all obligations of the Company
hereunder and the authorization, issuance and delivery of the Preferred Stock
being sold hereunder and the issuance (and/or the reservation for issuance) of
the Conversion Shares, the Conversion Warrants and the Warrant Shares have been
taken, and this Agreement, the Certificate of Designation, the Irrevocable
Instructions to Transfer Agent, the Escrow Agreement and the Registration Rights
Agreement constitute valid and legally binding obligations of the Company,
enforceable in accordance with their terms, except insofar as the enforceability
may be limited by applicable bankruptcy, insolvency, reorganization, or other
similar laws affecting creditors' rights generally or by principles governing
the availability of equitable remedies. The
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Company has obtained all consents and approvals required for it to execute,
deliver and perform each agreement referenced in the previous sentence.
4.4 Valid Issuance of Preferred Stock and Common Stock. The
Preferred Stock and the Conversion Warrants are duly authorized and, when
issued, sold and delivered in accordance with the terms hereof, for the
consideration expressed herein, will be validly issued, fully paid and
nonassessable and, based in part upon the representations of Subscriber in this
Agreement, will be issued in compliance with all applicable U.S. federal and
state securities laws. The Conversion Shares and the Warrant Shares are duly
authorized and, when issued in accordance with the terms of the Certificate of
Designation or the Conversion Warrants, as applicable, shall be duly and validly
issued and outstanding, fully paid and nonassessable, and based in part on the
representations and warranties of Subscriber of the Preferred Stock, will be
issued in compliance with all applicable U.S. federal and state securities laws.
The Preferred Stock, the Conversion Shares, the Conversion Warrants and the
Warrant Shares will be issued free of any preemptive rights. The Company
currently has Seven Million Two Hundred Thousand (7,200,000) Conversion Shares
reserved for issuance upon conversion of the Preferred Stock, and upon exercise
of the Conversion Warrants.
4.5 Compliance with Other Instruments. The Company is not in
violation or default of any provisions of its Certificate of Incorporation or
Bylaws each as amended, and in effect on and as of the date of the Agreement or
of any material provision of any material instrument or material contract to
which it is a party or by which it is bound or, to its knowledge, of any
provision of any federal or state judgment, writ, decree, order, statute, rule
or governmental regulation applicable to the Company, which would have a
material adverse affect on the Company's business or prospects, except as
described in the Disclosure Documents. The execution, delivery and performance
of this Agreement and the other agreements entered into in conjunction with the
Offering and the consummation of the transactions contemplated hereby will not
result in any such violation or be in conflict with or constitute, with or
without the passage of time and giving of notice, either a default under any
such provision, instrument or contract or an event which results in the creation
of any lien, charge or encumbrance upon any assets of the Company.
4.6 Reporting Company. The Company is subject to the reporting
requirements of the Exchange Act, has a class of securities registered under
Section 12 of the Exchange Act, and has filed all reports required by the
Exchange Act since 1990. The Company undertakes to furnish Subscriber with
copies of such reports as may be reasonably requested by Subscriber prior to
consummation of this Offering and thereafter, to make such reports available, as
long as Subscriber holds the Securities. The Company is not in violation of the
listing requirements of the Nasdaq National Market System and does not
reasonably anticipate that the Common Stock will be delisted by the Nasdaq
National Market System for the foreseeable future. The Company has filed all
reports required under the Exchange Act. The Company has not furnished to the
Subscriber any material nonpublic information concerning the Company
4.7 Capitalization. The capitalization of the Company as of December
31, 1997, is, and the capitalization as of the Closing, after taking into
account the offering of the Securities contemplated by this Agreement and all
other share issuances occurring prior to this Offering, will be, as set forth in
the Capitalization Schedule as set forth in Exhibit I. Except as disclosed in
the Capitalization Schedule and in the Company's Annual Report on Form 10-K for
the year ended June 30, 1997, as of the date of this Agreement, (i) there are no
outstanding options, warrants, scrip, rights to subscribe for, calls or
commitments of any character whatsoever relating to, or securities or rights
convertible into or exercisable or exchangeable for, any shares of capital stock
of the Company or any of its subsidiaries, or arrangements by which the Company
or any of its subsidiaries is or may become bound to issue additional shares of
capital stock of the Company or any of its subsidiaries, and (ii) other than the
current Registration Statement for the Company's
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Series F Preferred Stock and for certain Selling Security Holders underlying
warrants issued prior to 1996 or for shares of Common Stock underlying warrants
issued in connection with the Company's Preferred Stock Series as described in
the Company's Form 10-K Annual Report for the year ended June 30, 1997, there
are no agreements or arrangements under which the Company or any of its
subsidiaries is obligated to register the sale of any of its or their securities
under the Act (except the Registration Rights Agreement).
4.8 Intellectual Property. The Company has valid, unrestricted and
exclusive patents, trademarks, trademark registrations, trade names, copyrights,
know-how, technology and other intellectual property necessary to the conduct of
its business as set forth on Exhibit K-1. The Company has granted such licenses
or has assigned or otherwise transferred a portion of (or all of) such valid,
unrestricted and exclusive patents, trademarks, trademark registrations, trade
names, copyrights, know-how, technology and other intellectual property
necessary to the conduct of its business as set forth on Exhibit K-2. The
Company has been granted licenses, know-how, technology and/or other
intellectual property necessary to the conduct of its business as set forth on
Exhibit K-3. To the best of the Company's knowledge, the Company is not
infringing on the intellectual property rights of any third party, nor is any
third party infringing on the Company's intellectual property rights. There are
no restrictions in any agreements, licenses, franchises, or other instruments
which preclude the Company from engaging in its business as presently conducted.
4.9 Use of Proceeds. As of the date hereof, the Company expects to
use the proceeds from this Offering (less fees and expenses) for the purposes
and in the approximate amounts set forth on the Use of Proceeds Schedule set
forth as Exhibit J hereto. These purposes and amounts are estimates and are
subject to change without notice to any Subscriber.
4.10 No Rights of Participation. No person or entity, including, but
not limited to, current or former shareholders of the Company, underwriters,
brokers, agents or other third parties, has any right of first refusal,
preemptive right, right of participation, or any similar right to participate in
the financing contemplated by this Agreement which has not been waived.
4.11 Company Acknowledgment. The Company hereby acknowledges that
Subscriber may elect to hold the Securities for various periods of time, as
permitted by the terms of this Agreement, the Certificate of Designation, the
Conversion Warrants, and other agreements contemplated hereby, and the Company
further acknowledges that Subscriber and the Placement Agent have made no
representations or warranties, either written or oral, as to how long the
Securities will be held by Subscriber or regarding Subscriber's trading history
or investment strategies.
4.12 Termination Date of Offering. In no event shall the last
Closing ("Last Closing") of a sale and purchase of the Preferred Stock and
accompanying Conversion Warrants occur later than February 28, 1998, which date
can be extended by up to ten (10) days upon written approval by the Company and
the Placement Agent.
4.13 Underwriter's Fees and Rights of First Refusal. The Company is
not obligated to pay any compensation or other fees, costs or related
expenditures in cash or securities to any underwriter, broker, agent or other
representative other than the Placement Agent in connection with this Offering.
4.14 Current Public Information. The Company is currently eligible
to register the resale of its Common Stock on a registration statement on Form
S-3 under the Act.
4.15 No Integrated Offering. Neither the Company, nor any of its
affiliates, nor any person acting on its or their behalf, has directly or
indirectly made any offers or sales of any of
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the Company's securities or solicited any offers to buy any security under
circumstances that would prevent the parties hereto from consummating the
transactions contemplated hereby pursuant to an exemption from registration
under the Act pursuant to the provisions of Regulation D. The Company has not
engaged in any form of general solicitation or advertising in connection with
the offering of Series H Preferred Stock.
4.16 Acknowledgment of Dilution. The number of Conversion Shares
issuable upon conversion of the Preferred Stock may increase substantially in
certain circumstances, including the circumstance wherein the trading price of
the Common Stock declines. The Company's executive officers and directors have
studied and fully understand the nature of the Securities being sold hereunder
and recognize that they have a potential dilutive effect. The board of directors
of the Company has concluded in its good faith business judgment that such
issuance is in the best interests of the Company. The Company acknowledges that
its obligation to issue Conversion Shares upon conversion of the Preferred Stock
is binding upon it and enforceable regardless of the dilution that such issuance
may have on the ownership interests of the other stockholders.
4.17 Foreign Corrupt Practices. Neither the Company, nor any of its
subsidiaries, nor any director, officer, agent, employee or other person acting
on behalf of the Company or any subsidiary has, in the course of its actions
for, or on behalf of, the Company, used any corporate funds for any unlawful
contribution, gift, entertainment or other unlawful expenses relating to
political activity; made any direct or indirect unlawful payment to any foreign
or domestic government official or employee from corporate funds; violated or is
in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977,
as amended; or made any bribe, rebate, payoff, influence payment, kickback or
other unlawful payment to any foreign or domestic government official or
employee.
4.18 Key Employees. Each Key Employee (as defined below) is
currently serving the Company in the capacity disclosed in Exhibit M. No Key
Employee, to the best knowledge of the Company and its subsidiaries, is, or is
now expected to be, in violation of any material term of any employment
contract, confidentiality, disclosure or proprietary information agreement,
non-competition agreement, or any other contract or agreement or any restrictive
covenant, and the continued employment of each Key Employee does not subject the
Company or any of its subsidiaries to any liability with respect to any of the
foregoing matters. No Key Employee has, to the best knowledge of the Company and
its subsidiaries, any intention to terminate his employment with, or services
to, the Company or any of its subsidiaries. "Key Employee" means each of ▇▇▇▇▇▇
▇▇▇▇▇, Chairman & President, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, CEO, ▇▇. ▇▇▇ ▇▇▇▇▇▇▇▇▇▇, COO,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, CFO and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Vice President of Research &
Development.
4.19 Representations Correct. The foregoing representations,
warranties and agreements are true, correct and complete in all material
respects, and shall survive the Closing and the issuance of the shares of
Preferred Stock.
4.20 Press Release Approval. Any press release or other publicity
concerning this transaction (not including the registration statement that is
required to be filed under the Registration Rights Agreement) and the
Subscribers shall be submitted to the Subscriber for comment and prior approval
at least one (1) business day prior to publishing.
5. Covenants of the Company
5.1 Independent Auditors. The Company shall, until at least three
(3) years after the date of the Last Closing, maintain as its independent
auditors an accounting firm authorized to practice before the SEC.
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5.2 Corporate Existence and Taxes. The Company shall, until at least
the later of (i) the date that is three (3) years after the date of the Last
Closing or (ii) the conversion or redemption of all of the Preferred Stock
purchased pursuant to this Agreement, and the exercise of the Conversion
Warrants, maintain its corporate existence in good standing and remain a
Reporting Company (provided, however, that the foregoing covenant shall not
prevent the Company from entering into any merger or corporate reorganization as
long as the surviving entity in such transaction, if not the Company, assumes
the Company's obligations with respect to the Preferred Stock and has Common
Stock listed for trading on a stock exchange or on Nasdaq and is a "Reporting
Issuer") and shall pay all its taxes when due except for taxes which the Company
disputes.
5.3 Registration Rights. The Company will enter into a registration
rights agreement covering the resale of the Conversion Shares and the Warrant
Shares substantially in the form of the Registration Rights Agreement attached
as Exhibit E.
5.4 Notification of Final Closing Date by Company. Within five (5)
business days after the Last Closing, the Company shall notify Subscriber in
writing that the Last Closing has occurred, the date of the Last Closing, the
dates that Subscriber is entitled to convert Subscriber's Preferred Stock, and
the name and telephone number of an administrative contact person at the Company
whom Subscriber may contact regarding information related to conversion of the
Preferred Stock as contemplated by the Certificate of Designation.
5.5 Asset Transfers. The Company shall not transfer, sell, convey or
otherwise dispose of any of its material assets to any Subsidiary or affiliate
except for a cash or cash equivalent consideration and for a proper business
purpose, while any of the Series H Preferred Stock are outstanding, except for
(i) transfers or other dispositions to the Company's subsidiary, Viragen USA,
Inc., relating to research and development partnerships, and (ii) licensing
agreements in the ordinary course of business.
5.6 Capital Raising Limitations; Rights of First Refusal.
5.6.1 Capital Raising Limitations. The Company shall not issue
any debt or equity securities for cash in private capital raising transactions
("Future Offerings") for a period beginning on the date hereof and ending One
Hundred and Eighty (180) days after the Last Closing without obtaining the prior
written approval of Subscribers holding a majority of the purchase price of
Preferred Stock then outstanding.
5.6.2 Right of First Offer. The Company agrees that, during the
period beginning on the date hereof and terminating on the date that is twelve
(12) months after the date of the Last Closing, the Company will not, without
the prior written consent of each Subscriber (which shall be deemed given for
the warrants to purchase Common Stock issued or to be issued to the Placement
Agent in consideration of its services in connection with this Agreement and the
transactions contemplated hereby) issue or sell, or agree to issue or sell any
equity or debt securities of the Company or any of its subsidiaries (or any
security convertible into or exercisable or exchangeable, directly or
indirectly, for equity or debt securities of the Company or any of its
subsidiaries) ("Future Offerings") unless the Company shall have first delivered
to each Subscriber at least thirty (30) days prior to the closing of such Future
Offering, written notice describing the proposed Future Offering, including the
terms and conditions thereof, and providing each Subscriber and its affiliates
an option during the twenty (20) day period following delivery of such notice to
purchase up to the full amount of the securities being offered in the Future
Offering on the same terms as contemplated by such Future Offering (the
limitations referred to in this sentence are collectively referred to as the
"Capital Raising Limitations"). Notwithstanding the foregoing, if any Subscriber
chooses not to participate in any Future Offering, then any debt or equity
security
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issued as a result of said Future Offering will be ineligible for resale and/or
conversion, as the case may be, until the date which is nine (9) months after
the Last Closing.
5.6.3 Amount of Subscriber's Right of First Refusal. The amount
of securities which a Subscriber is entitled to purchase in such a Future
Offering shall be a number obtained by multiplying the aggregate amount of
securities being offered in the Future Offering by a fraction, the numerator of
which is the purchase price of the Preferred Stock purchased by the Subscriber
pursuant to this Agreement and the denominator of which is the aggregate dollar
amount of Preferred Stock placed in this Offering.
5.6.4 Exceptions to the Capital Raising Limitation. The Capital
Raising Limitations shall not apply to any transaction involving issuances of
securities in connection with a merger, consolidation, acquisition or sale of
assets, or in connection with any strategic partnership or joint venture (the
primary purpose of which is not to raise equity capital), or in connection with
the disposition or acquisition of a business, product or license by the Company
or exercise of options by employees, consultants or directors. The Capital
Raising Limitations also shall not apply to (a) the issuance of securities
pursuant to an underwritten public offering, (b) the issuance of securities upon
exercise or conversion of the Company's options, warrants or other convertible
securities outstanding as of the date hereof, (c) the grant of additional
options or warrants, or the issuance of additional securities, under any Company
stock option or restricted stock plan for the benefit of the Company's
employees, directors or consultants, (d) the grant of options or warrants, or
the issuance of securities relating to any research and development partnership
with the Company's Subsidiary, Viragen USA, Inc., or (e) the grant of options or
warrants relating to any agreement with the American Red Cross and similar blood
collection and processing organizations in exchange for blood products.
5.7 Financial 10-K Statements, Etc. and Current Reports on Form 8-K.
The Company shall make available to the Subscriber copies of its annual reports
on Form 10-K, quarterly reports on Form 10-Q and current reports on form 8-K for
as long as the Preferred Stock may remain outstanding.
5.8 Opinion of Counsel. Subscribers shall, upon purchase of the
Preferred Stock and accompanying Conversion Warrants pursuant to this Agreement,
receive an opinion letter from Atlas, ▇▇▇▇▇▇▇▇, Trop & Borkson, PA, New River
Center, Suite 1900, ▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇., ▇▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
("Counsel"), counsel to the Company, in the form attached as Exhibit F.
5.9 Removal of Legend Upon Conversion. As contemplated by the
Certificate of Designation, upon conversion of the Preferred Stock, Subscriber
shall submit a Notice of Conversion and Resale, substantially in the form
attached hereto as Exhibit L. The Legend shall be removed and the Company shall
issue a certificate without such Legend to the holder of any Security upon which
it is stamped, and a certificate for a security shall be originally issued
without the Legend, if, unless otherwise required by state securities laws, (a)
the resale of such Security is registered under the Act, or (b) such holder
provides the Company with an opinion of counsel, in form, substance and scope
customary for opinions of counsel in comparable transactions (the reasonable
cost of which shall be borne by the Company), to the effect that a public sale
or transfer of such Security may be made without registration under the Act, or
(c) such holder provides the Company with reasonable assurances that such
Security can be sold pursuant to Rule 144. Each Subscriber agrees to sell all
Securities, including those represented by a certificate(s) from which the
Legend has been removed, or which were originally issued without the Legend,
pursuant to an effective registration statement and to deliver a prospectus in
connection with such sale or in compliance with an exemption from the
registration requirements of the Act. In the event the Legend is removed from
any Security or any Security is issued without the Legend and thereafter the
effectiveness of a registration statement covering the resale of such Security
is suspended or the Company determines that a supplement or amendment thereto is
required by applicable securities
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laws, then upon reasonable advance notice to Subscriber holding such Security,
the Company may require that the Legend be placed on any such Security that
cannot then be sold pursuant to an effective registration statement or Rule 144
or with respect to which the opinion referred to in clause (b) next above has
not been rendered, which Legend shall be removed when such Security may be sold
pursuant to an effective registration statement or Rule 144 or such holder
provides the opinion with respect thereto described in clause (b) next above.
5.10 Listing. Subject to the remainder of this Section 5.10, the
Company shall ensure that its shares of Common Stock (including all Conversion
Shares and Warrant Shares) are listed and available for trading on the Nasdaq
National Market ("NMS"). Thereafter, the Company shall (i) use its best efforts
to continue the listing and trading of its Common Stock on the NMS, or on the
Nasdaq Small Cap Market ("NASDAQ"), the New York Stock Exchange ("NYSE"), or the
American Stock Exchange ("AMEX") or any other national exchange or
over-the-counter market system; (ii) take all action necessary to cause and
maintain the listing and trading of its Common Stock on the OTC Bulletin Board
at any time the Common Stock is not listed and traded on NASDAQ, NMS, NYSE or
AMEX; and (iii) comply in all respects with the Company's reporting, filing and
other obligations under the by-laws or rules of the National Association of
Securities Dealers ("NASD") and such exchanges, as applicable.
5.11 The Company's Instructions to Transfer Agent. The Company will
issue to its Transfer Agent the Irrevocable Instructions to Transfer Agent
substantially in the form of Exhibit G instructing the Transfer Agent to issue
certificates, registered in the name of each Subscriber or its nominee, for the
Conversion Shares and Warrant Shares in such amounts as specified from time to
time by such Subscriber to the Company upon conversion of the Preferred Stock
and exercise of the Conversion Warrants. Such certificates shall bear a Legend
only to the extent permitted by Section 5.9 hereof. The Company warrants that no
instruction, other than such instructions referred to in Section 5.9 hereof or
in this Section 5.11 and stop transfer instructions to give effect to Section
3.7 hereof in the case of Conversion Shares and Warrant Shares prior to
registration of the Conversion Shares and Warrant Shares under the Act, will be
given by the Company to its Transfer Agent and that the Securities shall
otherwise be freely transferable on the books and records of the Company as and
to the extent provided in this Agreement and the Registration Rights Agreement.
Nothing in this Section shall affect in any way each Subscriber's obligations
and agreement set forth in Sections 2.3.3 or 2.3.4 hereof to resell the
Securities pursuant to an effective registration statement and to deliver a
prospectus in connection with such sale or in compliance with an exemption from
the registration requirements of applicable securities laws. If (a) a Subscriber
provides the Company with an opinion of counsel, which opinion of counsel shall
be in form, substance and scope customary for opinions of counsel in comparable
transactions (the reasonable cost of which shall be borne by the Company), to
the effect that the Securities to be sold or transferred may be sold or
transferred pursuant to an exemption from registration or (b) a Subscriber
transfers Securities to an affiliate which is an accredited investor pursuant to
Rule 144, the Company shall permit the transfer, and, in the case of Conversion
Shares and Warrant Shares, promptly instruct its transfer agent to issue one or
more certificates in such name and in such denomination as specified by such
Subscriber. The Company acknowledges that a breach by it of its obligations
hereunder will cause irreparable harm to a Subscriber by vitiating the intent
and purpose of the transaction contemplated hereby. Accordingly, the Company
acknowledges that the remedy at law for a breach of its obligations under this
Section 5.11 will be inadequate and agrees, in the event of a breach or
threatened breach by the Company of the provisions of this Section 5.11, that a
Subscriber shall be entitled, in addition to all other available remedies, to an
injunction restraining any breach and requiring immediate issuance and transfer,
without the necessity of showing economic loss and without any bond or other
security being required. The Company hereby agrees that it will not unilaterally
terminate its relationship with the Transfer Agent for any reason prior to the
date which is three (3) years after the Last Closing or one (1) month after the
first date that no Preferred Stock and no Conversion Warrants are outstanding,
whichever is earlier (the "Ending Date") or until such time
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that a successor transfer agent (i) is appointed by the Company, and (ii)
executes and agrees to be bound by the terms of the Irrevocable Instructions to
Transfer Agent.
6. Subscriber Covenant/Miscellaneous
6.1 Representations and Warranties Survive the Closing;
Severability. Subscriber's and the Company's representations and warranties
shall survive the Closing of the transactions contemplated by this Agreement
notwithstanding any due diligence investigation made by or on behalf of the
party seeking to rely thereon. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision; provided that no such severability shall be effective if
it materially changes the economic benefit of this Agreement to any party.
6.2 Successors and Assigns. The terms and conditions of this
Agreement shall inure to the benefit of and be binding upon the respective
successors and assigns of the parties. Nothing in this Agreement, express or
implied, is intended to confer upon any party other than the parties hereto or
their respective successors and assigns any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, except as expressly provided
in this Agreement. Subscriber may assign Subscriber's rights hereunder, in
connection with any private sale of the Preferred Stock of such Subscriber, so
long as, as a condition precedent to such transfer, the transferee executes an
acknowledgment agreeing to be bound by the applicable provisions of this
Agreement.
6.3 Governing Law. This Agreement shall be governed by and
construed under the laws of the State of Delaware without respect to conflict of
laws principles.
6.4 Execution in Counterparts Permitted. This Agreement may be
executed in any number of counterparts, each of which shall be enforceable
against the parties actually executing such counterparts, and all of which
together shall constitute one (1) instrument.
6.5 Titles and Subtitles; Gender. The titles and subtitles
used in this Agreement are used for convenience only and are not to be
considered in construing or interpreting this Agreement. The use in this
Agreement of a masculine, feminine or neither pronoun shall be deemed to include
a reference to the others.
6.6 Written Notices, Etc. Any notice, demand or request
required or permitted to be given by the Company or Subscriber pursuant to the
terms of this Agreement shall be in writing and shall be deemed given when
delivered personally, or by facsimile (with a hard copy to follow by two (2) day
courier), addressed to the parties at the addresses and/or facsimile telephone
number of the parties set forth at the end of this Agreement or such other
address as a party may request by notifying the other in writing.
6.7 Expenses. Each of the Company and Subscriber shall pay all
costs and expenses that it respectively incurs, with respect to the negotiation,
execution, delivery and performance of this Agreement.
6.8 Entire Agreement; Written Amendments Required. This
Agreement, including the Exhibits attached hereto, the Certificate of
Designation, the Preferred Stock certificates, the Conversion Warrants, the
Registration Rights Agreement, the Escrow Agreement, the Irrevocable
Instructions to Transfer Agent and the other documents delivered pursuant hereto
constitute the full and entire understanding and agreement between the parties
with regard to the subjects hereof and thereof, and no party shall be liable or
bound to any other party in any manner by any warranties, representations or
covenants except as specifically set forth herein or therein. Except as
expressly
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provided herein, neither this Agreement nor any term hereof may be amended,
waived, discharged or terminated other than by a written instrument signed by
the party against whom enforcement of any such amendment, waiver, discharge or
termination is sought.
6.9 No Five Percent Holders. Notwithstanding anything to the
contrary contained herein, the Series H Preferred Stock shall not be convertible
by a Holder or at the Termination Date to the extent (but only to the extent)
that, if converted by such Holder or at the Termination Date, the Holder would
beneficially own in excess of 4.9% of the then outstanding shares of Common
Stock of the Company. To the extent this limitation applies, the determination
of whether Series H Preferred Stock shall be convertible (vis-a vis other
securities owned by such Holder) and of which Series H Preferred Stock shall be
converted shall be in the sole discretion of the Holder and submission of the
Series H Preferred Stock for conversion shall be deemed to be the Holder's
determination of whether such Series H Preferred Stock is convertible, subject
to such aggregate percentage limitations. No prior inability to convert Series H
Preferred Stock pursuant to this subparagraph shall have any effect on the
applicability of its provisions with respect to any subsequent determination of
convertibility. For the purposes of this subparagraph, beneficial ownership and
all calculations, including without limitation, with respect to calculations of
percentage ownership shall be determined in accordance with Section 13(d) of the
Securities Exchange Act of 1934, as amended, and the Regulations thereunder.
Notwithstanding the foregoing, each Holder shall have the right to waive such
restriction or increase such percentage upon sixty one (61) days' prior notice
to the Company and to decrease any such percentage immediately upon written
notice to the Company. No transferee of Series H Preferred Stock shall be bound
by such restriction unless the transferee expressly so agrees. The provisions of
this subparagraph may be waived and/or implemented in a manner otherwise than in
strict conformity with the terms hereof with the approval of the Board of
Directors of the Company and the Holders of a majority in interest in the then
outstanding Series H Preferred Stock: (i) with respect to any matter to cure any
ambiguity herein, to correct this subparagraph (or any portion thereof) which
may be defective or inconsistent with the intended 4.9% beneficial ownership
limitation herein contained or to make changes or supplements necessary or
desirable to properly give effect to such 4.9% limitation; and (ii) with respect
to any other matter, with the further consent of the Holders of majority of the
then outstanding shares of Common Stock. The limitations contained in this
subparagraph shall apply to a successor Holder of Series H Preferred Stock if,
and to the extent, elected by such successor Holder concurrently with its
acquisition of such Series H Preferred Stock, such election to be promptly
confirmed in writing to the Company (provided no transfer or series of transfers
to a successor Holder or Holders shall be used by a Holder to evade the
limitations contained herein).
6.10 Arbitration. Any controversy or claim arising out of or
related to this Agreement or the breach thereof, shall be settled by binding
arbitration in Wilmington, Delaware in accordance with the Expedited Procedures
(Rules 53-57) of the Commercial Arbitration Rules of the American Arbitration
Association ("AAA"). A proceeding shall be commenced upon written demand by
Company or any Subscriber to the other. The arbitrator(s) shall enter a judgment
by default against any party which fails or refuses to appear in any properly
noticed arbitration proceeding. The proceeding shall be conducted by one (1)
arbitrator, unless the amount alleged to be in dispute exceeds two hundred fifty
thousand dollars ($250,000), in which case three (3) arbitrators shall preside.
The arbitrator(s) will be chosen by the parties from a list provided by the AAA,
and if they are unable to agree within ten (10) days, the AAA shall select the
arbitrator(s). The arbitrators must be experts in securities law and financial
transactions. The arbitrators shall assess costs and expenses of the
arbitration, including all attorneys' and experts' fees, as the arbitrators
believe is appropriate in light of the merits of the parties' respective
positions in the issues in dispute. Each party submits irrevocably to the
jurisdiction of any state court sitting in Wilmington, Delaware or to the United
States District Court sitting in Delaware for purposes of enforcement of any
discovery order, judgment or award in connection with such arbitration. The
award of the arbitrator(s) shall be final and binding upon the parties and may
be enforced in any
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court having jurisdiction. The arbitration shall be held in such place as set by
the arbitrator(s) in accordance with Rule 55.
6.11 Certain Trading Restrictions. The Subscriber agrees that
during the period from the date the Registration Statement is first declared
effective by the SEC to the date that all shares of Series H Preferred Stock
owned by the Subscriber are either converted in full or redeemed by the Company
or otherwise disposed of by the Subscriber, the Subscriber shall not engage in
short sales or other hedging transactions with respect to the Common Stock;
provided, however, that the Subscriber may enter into such transactions
involving a number of shares of Common Stock not to exceed the number of
Conversion Shares for which a Conversion Notice has been submitted to the
Company.
7. Subscription and Wiring Instructions; Irrevocability.
7.1 Subscription
(a) Wire transfer of Subscription Funds. Subscriber shall
send this signed Agreement by facsimile to the
Placement Agent at (▇▇▇) ▇▇▇-▇▇▇▇, and send the
subscription funds by wire transfer, to the Escrow
Agent as follows:
First Union National Bank
ABA # ▇▇▇▇▇▇▇▇▇
Account # 465946
Account Name: Trust Ledger
Attn: ▇▇▇▇▇ ▇▇▇▇ ▇▇▇-▇▇▇-▇▇▇▇
Reference: Viragen #3072237305
SWIFT Code: ▇▇▇▇▇▇▇▇
(b) Irrevocable Subscription. Subscriber hereby
acknowledges and agrees, subject to the provisions of
any applicable laws providing for the refund of
subscription amounts submitted by Subscriber, that
this Agreement is irrevocable and that Subscriber is
not entitled to cancel, terminate or revoke this
Agreement or any other agreements executed by such
Subscriber and delivered pursuant hereto, and that
this Agreement and such other agreements shall
survive the death or disability of such Subscriber
and shall be binding upon and inure to the benefit of
the parties and their heirs, executors,
administrators, successors, legal representatives and
assigns. If the Securities subscribed for are to be
owned by more than one person, the obligations of all
such owners under this Agreement shall be joint and
several, and the agreements, representations,
warranties and acknowledgments herein contained shall
be deemed to be made by and be binding upon each such
person and his heirs, executors, administrators,
successors, legal representatives and assigns.
Notwithstanding the foregoing, (i) if the conditions
to Closing are not satisfied or (ii) if the
Disclosure Documents are discovered prior to Closing
to contain statements which are materially
inaccurate, or omit statements of material fact,
Subscriber may revoke or cancel this Agreement.
(c) Company's Right to Reject Subscription. Subscriber
understands that this Agreement is not binding on the
Company until the Company accepts it. This Agreement
shall be accepted by the Company when the Company
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countersigns this Agreement. Subscriber hereby
confirms that the Company has full right in its sole
discretion to accept or reject the subscription of
Subscriber, in whole or in part, provided that, if
the Company decides to reject such subscription, the
Company must do so promptly and in writing. In the
case of rejection, the Company will promptly return
any rejected payments and (if rejected in whole)
copies of all executed subscription documents
(including without limitation this Agreement) to
Subscriber. In the event of rejection, no interest
will be payable by the Company to Subscriber on any
return of payment, provided however, that any such
interest accrued on such funds in the Escrow Account
shall be returned to the Subscriber by the Escrow
Agent.
7.2 Acceptance of Subscription. In the case of acceptance of
Subscriber's subscription, ownership of the number of securities being purchased
hereby will pass to Subscriber upon the Closing.
7.3 Subscriber to Forward Original Signed Subscription
Agreement to Company. Subscriber agrees to courier to Company his, her or its
original inked signed Subscription Agreement within two (2) days after faxing
said signed agreement to Placement Agent.
8. Indemnification.
The Company agrees to indemnify and hold harmless Subscriber and the
Placement Agent and each of their respective officers, directors, employees and
agents, and each person who controls Subscriber or the Placement Agent within
the meaning of the Act or the Exchange Act (each, a "Subscriber Indemnified
Party") against any losses, claims, damages or liabilities, joint or several, to
which it, they or any of them, may become subject and not otherwise reimbursed
arising from or due to any untrue statement of a material fact or the omission
to state any material fact required to be stated in order to make the statements
not misleading in any representation or warranty made by the Company contained
in this Agreement or in any statements contained in the Disclosure Documents.
Subscriber agrees to indemnify and hold harmless the Company and the
Placement Agent and each of their respective officers, directors, employees and
agents, and each person who controls Company or the Placement Agent within the
meaning of the Act or the Exchange Act (each, a "Company Indemnified Party") (a
Subscriber Indemnified Party or a Company Indemnified Party may be hereinafter
referred to singularly as "Indemnified Party") against any losses, claims,
damages or liabilities, joint or several, to which it, they or any of them, may
become subject and not otherwise reimbursed arising from or due to any untrue
statement of a material fact or the omission to state any material fact required
to be stated in order to make the statements not misleading in any
representation or warranty made by Subscriber contained in this Agreement.
Promptly after receipt by an Indemnified Party of notice of the
commencement of any action pursuant to which indemnification may be sought, such
Indemnified Party will, if a claim in respect thereof is to be made against the
other party (hereinafter "Indemnitor") under this Section 8, deliver to the
Indemnitor a written notice of the commencement thereof and the Indemnitor shall
have the right to participate in and to assume the defense thereof with counsel
reasonably selected by the Indemnitor, provided, however, that an Indemnified
Party shall have the right to retain its own counsel, with the reasonably
incurred fees and expenses of such counsel to be paid by the Indemnitor, if
representation of such Indemnified Party by the counsel retained by the
Indemnitor would be inappropriate due to actual or potential conflicts of
interest between such Indemnified Party and any other party represented by such
counsel in such proceeding. The failure to deliver written notice to the
Indemnitor within a reasonable time of the commencement of any such action, if
prejudicial to the Indemnitor's ability to defend such action, shall relieve the
Indemnitor of any liability to the Indemnified Party under this Section 8, but
the omission to so deliver
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written notice to the Indemnitor will not relieve it of any liability that it
may have to any Indemnified Party other than under this Section 8 to the extent
it is prejudicial.
9. Certain Additional Legends and Information.
FOR FLORIDA RESIDENTS:
THE SECURITIES REFERRED TO HEREIN WILL BE SOLD TO, AND
ACQUIRED BY, THE HOLDER IN A TRANSACTION EXEMPT UNDER SECTION 517.061 OF THE
FLORIDA SECURITIES ACT. THE SECURITIES HAVE NOT BEEN REGISTERED UNDER SAID ACT
IN THE STATE OF FLORIDA. IN ADDITION, ALL FLORIDA RESIDENTS SHALL HAVE THE
PRIVILEGE OF VOIDING THE PURCHASE WITHIN THREE (3) DAYS AFTER THE FIRST TENDER
OF CONSIDERATION IS MADE BY SUCH SUBSCRIBER TO THE ISSUER, AN AGENT OF THE
ISSUER, OR AN ESCROW AGENT OR WITHIN THREE DAYS AFTER THE AVAILABILITY OF THAT
PRIVILEGE IS COMMUNICATED TO SUCH SUBSCRIBER, WHICHEVER OCCURS LATER.
FOR MAINE RESIDENTS:
THESE SECURITIES ARE BEING SOLD PURSUANT TO AN EXEMPTION FROM
REGISTRATION WITH THE BANK SUPERINTENDENT OF THE STATE OF MAINE UNDER SECTION
10502(2)(R) OF TITLE 32 OF THE MAINE REVISED STATUTES. THESE SECURITIES MAY BE
DEEMED RESTRICTED SECURITIES AND AS SUCH THE HOLDER MAY NOT BE ABLE TO RESELL
THE SECURITIES UNLESS PURSUANT TO REGISTRATION UNDER STATE OR FEDERAL SECURITIES
LAWS OR UNLESS AN EXEMPTION UNDER SUCH LAWS EXISTS.
FOR PENNSYLVANIA RESIDENTS:
EACH PENNSYLVANIA RESIDENT WHO SUBSCRIBES FOR THE SECURITIES
BEING OFFERED HEREBY AGREES NOT TO SELL THESE SECURITIES FOR A PERIOD OF TWELVE
MONTHS AFTER THE DATE OF PURCHASE UNLESS SUCH SECURITIES HAVE BEEN REGISTERED
FOR SALE. UNDER PROVISION OF THE PENNSYLVANIA SECURITIES ACT OF 1972 (THE "1972
ACT"), EACH PENNSYLVANIA RESIDENT SHALL HAVE THE RIGHT TO WITHDRAW HIS
ACCEPTANCE WITHOUT INCURRING ANY LIABILITY, TO THE SELLER, UNDERWRITER (IF ANY)
OR ANY PERSON, WITHIN TWO (2) BUSINESS DAYS FROM THE DATE OF RECEIPT BY THE
ISSUER OF HIS WRITTEN BINDING CONTRACT OF PURCHASE OR IN THE CASE OF A
TRANSACTION IN WHICH THERE IS NO WRITTEN BINDING CONTRACT OF PURCHASE, WITHIN
TWO BUSINESS DAYS AFTER HE MAKES THE INITIAL PAYMENT FOR THE SECURITIES BEING
OFFERED. TO ACCOMPLISH THIS WITHDRAWAL, A SUBSCRIBER NEED ONLY SEND A LETTER OR
TELEGRAM TO THE SELLING AGENT AT THE ADDRESS SET FORTH IN THE TEXT OF THE
MEMORANDUM, INDICATING HIS OR HER INTENTION TO WITHDRAW. SUCH LETTER OR TELEGRAM
SHOULD BE SENT AND POSTMARKED PRIOR TO THE END OF THE AFOREMENTIONED SECOND
BUSINESS DAY. IT IS PRUDENT TO SEND SUCH LETTER BY CERTIFIED MAIL, RETURN
RECEIPT REQUESTED, TO ENSURE THAT IT IS RECEIVED AND ALSO TO EVIDENCE THE TIME
WHEN IT WAS MAILED. IF THE REQUEST IS MADE ORALLY (IN PERSON OR BY TELEPHONE, TO
THE SELLING AGENT AT THE NUMBER LISTED IN THE TEXT OF THE MEMORANDUM) A WRITTEN
CONFIRMATION THAT THE REQUEST HAS BEEN RECEIVED SHOULD BE REQUESTED.
FOR NEW HAMPSHIRE RESIDENTS:
NEITHER THE FACT THAT A REGISTRATION STATEMENT OR AN
APPLICATION FOR A LICENSE HAS BEEN FILED WITH THE STATE OF NEW HAMPSHIRE
18
19
NOR THE FACT THAT A SECURITY IS EFFECTIVELY REGISTERED OR A PERSON IS LICENSED
IN THE STATE OF NEW HAMPSHIRE CONSTITUTES A FINDING BY THE SECRETARY OF STATE
THAT ANY DOCUMENT FILED UNDER RSA 421-B IS TRUE, COMPLETE AND NOT MISLEADING.
NEITHER ANY SUCH FACT NOR THE FACT THAT AN EXEMPTION OR EXCEPTION IS AVAILABLE
FOR A SECURITY OR A TRANSACTION MEANS THAT THE SECRETARY OF STATE HAS PASSED IN
ANY WAY UPON THE MERITS OR QUALIFICATIONS OF, OR RECOMMENDED OR GIVEN APPROVAL
TO, ANY PERSON, SECURITY, OR TRANSACTION. IT IS UNLAWFUL TO MAKE, OR CAUSE TO BE
MADE, TO ANY PROSPECTIVE PURCHASER, CUSTOMER OR CLIENT ANY REPRESENTATION
INCONSISTENT WITH THE PROVISIONS OF THIS PARAGRAPH.
[INTENTIONALLY LEFT BLANK]
19
20
10. Number of Shares and Purchase Price. Subscriber subscribes for
_________ shares of Preferred Stock (in the amount of $10,000 per Share) and the
accompanying Conversion Warrants against payment by wire transfer in the amount
of $___________________ ("Purchase Price").
11. Accredited Investor. Subscriber is an "accredited investor" because
(check all applicable boxes):
(a) [ ] it is an organization described in Section 501(c)(3) of the
Internal Revenue Code, or a corporation, business trust, or
partnership not formed for the specific purpose of acquiring
the securities offered, with total assets in excess of
$5,000,000.
(b) [ ] any trust, with total assets in excess of $5,000,000, not
formed fo r the specific purpose of acquiring the securities
offered, whose purchase is directed by a sophisticated person
who has such knowledge and experience in financial and
business matters that he is capable of evaluating the merits
and risks of the prospective investment.
(c) [ ] a natural person, who
[ ] is a director, executive officer or general partner of the
issuer of the securities being offered or sold or a director,
executive officer or general partner of a general partner of
that issuer.
[ ] has an individual net worth, or joint net worth with that
person's spouse, at the time of his purchase exceeding
$1,000,000.
[ ] had an individual income in excess of $200,000 in
each of the two most recent years or joint income with that
person's spouse in excess of $300,000 in each of those years
and has a reasonable expectation of reaching the same income
level in the current year.
(d) [ ] an entity each equity owner of which is an entity
described in a - b above or is an individual who could check
one (1) of the last three (3) boxes under subparagraph (c)
above.
(e) [ ] other [specify] ___________________________________________
The undersigned acknowledges that this Agreement and the subscription
represented hereby shall not be effective unless accepted by the Company as
indicated below.
IN WITNESS WHEREOF, the undersigned Subscriber does represent and
certify under penalty of perjury that the foregoing statements are true and
correct and that Subscriber by the following signature(s) executed this
Agreement.
Dated this _____ day of February, 1998.
------------------------------------ ---------------------------------------------------------
Your Signature PRINT EXACT NAME IN WHICH YOU WANT
THE SECURITIES TO BE REGISTERED
------------------------------------- DELIVERY INSTRUCTIONS:
Name: Please Print Please type or print address where your security is to
be delivered
----------------------------------------------- ATTN.:
Title/Representative Capacity (if applicable) ---------------------------------------------------
----------------------------------------------- ---------------------------------------------------------
Name of Company You Represent (if applicable) Street Address
----------------------------------------------- ---------------------------------------------------------
Place of Execution of this Agreement City, State or Province, Country, Offshore Postal Code
---------------------------------------------------------
Phone Number (For Federal Express) and Fax Number
(re: Notice)
THIS AGREEMENT IS ACCEPTED BY THE COMPANY IN THE AMOUNT OF $
_________________ ON THE ____ DAY OF FEBRUARY, 1998.
Viragen, Inc.
By:
--------------------------------
Name:
--------------------------------
Title:
--------------------------------
20
21
NOTICE OF CONVERSION [AND RESALE]
(To be Executed by the Registered Holder
in order to Convert the Preferred Stock)
The undersigned hereby irrevocably elects to convert _____________ shares of
Series H Preferred Stock, represented by stock certificate No(s).
________________ (the "Preferred Stock Certificates") into shares of common
stock ("Common Stock") of Viragen, Inc. (the "Company") according to the
conditions of the Certificate of Designation of Series H Preferred Stock, as of
the date written below [in connection with the resale of the underlying Common
Stock unless otherwise indicated below]. If shares are to be issued in the name
of a person other than the undersigned, the undersigned will pay all transfer
taxes payable with respect thereto and is delivering herewith such certificates.
No fee will be charged to the Holder for any conversion, except for transfer
taxes, if any. A copy of each of the Preferred Stock Certificates being
converted is attached hereto. The undersigned agrees to deliver a Prospectus in
connection with any sale made pursuant to the Registration Statement, as
provided in Section 5.10 of the Subscription Agreement.
____ Check here if this conversion is not being made in
connection with the resale of the Common Stock.
Date of Conversion:
----------------
Applicable Conversion Price:
-------
Number of Shares of
Common Stock to be Issued:_________
Signature:
-------------------------
Name:
------------------------------
Address:
--------------------------
* No shares of Common Stock will be issued until the original Series H Preferred
Stock Certificate(s) to be converted and the Notice of Conversion are received
by the Company or its Transfer Agent. The Holder shall (i) send via facsimile,
on or prior to 11:59 p.m., New York City time, on the date of conversion, a copy
of this completed and fully executed Notice of Conversion to the Company at the
office of the Company and its designated Transfer Agent for the Series H
Preferred Stock that the Holder elects to convert and (ii) surrender, to a
common courier for either overnight or two (2) day delivery to the office of the
Company or the Transfer Agent, the original Series H Preferred Stock
Certificate(s) representing the Series H Preferred Stock being converted, duly
endorsed for transfer. The Company or its Transfer Agent shall issue shares of
Common Stock and surrender them to a common courier for delivery to the
shareholder within two (2) business days following receipt of a facsimile of
this Notice of Conversion and receipt by the Company or its Transfer Agent of
the original Series H Preferred Stock Certificate(s) to be converted, all in
accordance with the terms of the Certificate of Designation and the Subscription
Agreement, and shall make payments for the number of business days such issuance
and delivery is late, pursuant to the terms of the Certificate of Designation.
21
22
EXHIBIT L
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF OR EXERCISED UNLESS (i) A REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL
HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS
AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
"N" shares
"9 MONTH" WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that ________________ or any subsequent holder hereof
("Holder"), has the right to purchase from VIRAGEN, INC., a Delaware corporation
(the "Company"), up to "N" fully paid and nonassessable shares, wherein "N" is
defined below, of the Company's common stock, $.01 par value per share ("Common
Stock"), subject to adjustment as provided herein, at a price equal to the
Exercise Price as defined in Section 3 below, at any time beginning on the Date
of Issuance (as defined below) and ending at 5:00 p.m., New York, New York time,
on February 17, 2003 (the "Exercise Period"); provided, that "N" shall equal ten
percent (10%) of the quotient obtained when (i) the principal amount of the
Series H Preferred Stock purchased by Holder minus the principal amount of any
Series H Share Disposition, as defined below, that occurs prior to the
expiration of the date which is nine (9) months from the Date of Issuance (the
"9 Month Date"), is divided by (ii) the "9 Month Market Price", as defined
below. For purposes hereof, "Series H Share Disposition" shall mean a
transaction whereby the Holder either (i) transfers shares of the Series H
Preferred Stock; or (ii) converts shares of the Series H Preferred Stock
pursuant to the terms of the Company's Certificate of Designation of Series H
Preferred Stock and "9 Month Market Price" shall mean the average of the lowest
two (2) closing bid prices during the twenty (20) trading days for the Common
Stock prior to the 9 Month Date. Within ten (10) days of the 9 Month Date, the
Company shall provide written confirmation to the Holder of the number of shares
of Common Stock, as adjusted if applicable, which the Holder has the right to
purchase hereunder.
Holder agrees with the Company that this Warrant to Purchase Common
Stock of Viragen, Inc. (this "Warrant") is issued and all rights hereunder shall
be held subject to all of the conditions, limitations and provisions set forth
herein.
23
EXHIBIT B
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF OR EXERCISED UNLESS (i) A REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL
HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS
AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
"N" shares
"9 MONTH" WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that Global Bermuda Limited Partnership or any
subsequent holder hereof ("Holder"), has the right to purchase from VIRAGEN,
INC., a Delaware corporation (the "Company"), up to "N" fully paid and
nonassessable shares, wherein "N" is defined below, of the Company's common
stock, $.01 par value per share ("Common Stock"), subject to adjustment as
provided herein, at a price equal to the Exercise Price as defined in Section 3
below, at any time beginning on the Date of Issuance (as defined below) and
ending at 5:00 p.m., New York, New York time, on February 17, 2003 (the
"Exercise Period"); provided, that "N" shall equal ten percent (10%) of the
quotient obtained when (i) the principal amount of the Series H Preferred Stock
purchased by Holder minus the principal amount of any Series H Share
Disposition, as defined below, that occurs prior to the expiration of the date
which is nine (9) months from the Date of Issuance (the "9 Month Date"), is
divided by (ii) the "9 Month Market Price", as defined below. For purposes
hereof, "Series H Share Disposition" shall mean a transaction whereby the Holder
either (i) transfers shares of the Series H Preferred Stock; or (ii) converts
shares of the Series H Preferred Stock pursuant to the terms of the Company's
Certificate of Designation of Series H Preferred Stock and "9 Month Market
Price" shall mean the average of the lowest two (2) closing bid prices during
the twenty (20) trading days for the Common Stock prior to the 9 Month Date.
Within ten (10) days of the 9 Month Date, the Company shall provide written
confirmation to the Holder of the number of shares of Common Stock, as adjusted
if applicable, which the Holder has the right to purchase hereunder.
Holder agrees with the Company that this Warrant to Purchase Common
Stock of Viragen, Inc. (this "Warrant") is issued and all rights hereunder shall
be held subject to all of the conditions, limitations and provisions set forth
herein.
24
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF OR EXERCISED UNLESS (i) A REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL
HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS
AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
"N" shares
"9 MONTH" WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that Lakeshore International, Ltd. or any subsequent
holder hereof ("Holder"), has the right to purchase from VIRAGEN, INC., a
Delaware corporation (the "Company"), up to "N" fully paid and nonassessable
shares, wherein "N" is defined below, of the Company's common stock, $.01 par
value per share ("Common Stock"), subject to adjustment as provided herein, at a
price equal to the Exercise Price as defined in Section 3 below, at any time
beginning on the Date of Issuance (as defined below) and ending at 5:00 p.m.,
New York, New York time, on February 17, 2003 (the "Exercise Period"); provided,
that "N" shall equal ten percent (10%) of the quotient obtained when (i) the
principal amount of the Series H Preferred Stock purchased by Holder minus the
principal amount of any Series H Share Disposition, as defined below, that
occurs prior to the expiration of the date which is nine (9) months from the
Date of Issuance (the "9 Month Date"), is divided by (ii) the "9 Month Market
Price", as defined below. For purposes hereof, "Series H Share Disposition"
shall mean a transaction whereby the Holder either (i) transfers shares of the
Series H Preferred Stock; or (ii) converts shares of the Series H Preferred
Stock pursuant to the terms of the Company's Certificate of Designation of
Series H Preferred Stock and "9 Month Market Price" shall mean the average of
the lowest two (2) closing bid prices during the twenty (20) trading days for
the Common Stock prior to the 9 Month Date. Within ten (10) days of the 9 Month
Date, the Company shall provide written confirmation to the Holder of the number
of shares of Common Stock, as adjusted if applicable, which the Holder has the
right to purchase hereunder.
Holder agrees with the Company that this Warrant to Purchase Common
Stock of Viragen, Inc. (this "Warrant") is issued and all rights hereunder shall
be held subject to all of the conditions, limitations and provisions set forth
herein.
25
EXHIBIT B
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF OR EXERCISED UNLESS (i) A REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL
HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS
AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
"N" shares
"9 MONTH" WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that ▇▇▇▇▇▇▇▇ Trading Group, LLC or any subsequent
holder hereof ("Holder"), has the right to purchase from VIRAGEN, INC., a
Delaware corporation (the "Company"), up to "N" fully paid and nonassessable
shares, wherein "N" is defined below, of the Company's common stock, $.01 par
value per share ("Common Stock"), subject to adjustment as provided herein, at a
price equal to the Exercise Price as defined in Section 3 below, at any time
beginning on the Date of Issuance (as defined below) and ending at 5:00 p.m.,
New York, New York time, on February 17, 2003 (the "Exercise Period"); provided,
that "N" shall equal ten percent (10%) of the quotient obtained when (i) the
principal amount of the Series H Preferred Stock purchased by Holder minus the
principal amount of any Series H Share Disposition, as defined below, that
occurs prior to the expiration of the date which is nine (9) months from the
Date of Issuance (the "9 Month Date"), is divided by (ii) the "9 Month Market
Price", as defined below. For purposes hereof, "Series H Share Disposition"
shall mean a transaction whereby the Holder either (i) transfers shares of the
Series H Preferred Stock; or (ii) converts shares of the Series H Preferred
Stock pursuant to the terms of the Company's Certificate of Designation of
Series H Preferred Stock and "9 Month Market Price" shall mean the average of
the lowest two (2) closing bid prices during the twenty (20) trading days for
the Common Stock prior to the 9 Month Date. Within ten (10) days of the 9 Month
Date, the Company shall provide written confirmation to the Holder of the number
of shares of Common Stock, as adjusted if applicable, which the Holder has the
right to purchase hereunder.
Holder agrees with the Company that this Warrant to Purchase Common
Stock of Viragen, Inc. (this "Warrant") is issued and all rights hereunder shall
be held subject to all of the conditions, limitations and provisions set forth
herein.
26
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF OR EXERCISED UNLESS (i) A REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL
HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS
AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
"N" shares
"9 MONTH" WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that The Tail Wind Fund Ltd. or any subsequent holder
hereof ("Holder"), has the right to purchase from VIRAGEN, INC., a Delaware
corporation (the "Company"), up to "N" fully paid and nonassessable shares,
wherein "N" is defined below, of the Company's common stock, $.01 par value per
share ("Common Stock"), subject to adjustment as provided herein, at a price
equal to the Exercise Price as defined in Section 3 below, at any time beginning
on the Date of Issuance (as defined below) and ending at 5:00 p.m., New York,
New York time, on February 17, 2003 (the "Exercise Period"); provided, that "N"
shall equal ten percent (10%) of the quotient obtained when (i) the principal
amount of the Series H Preferred Stock purchased by Holder minus the principal
amount of any Series H Share Disposition, as defined below, that occurs prior to
the expiration of the date which is nine (9) months from the Date of Issuance
(the "9 Month Date"), is divided by (ii) the "9 Month Market Price", as defined
below. For purposes hereof, "Series H Share Disposition" shall mean a
transaction whereby the Holder either (i) transfers shares of the Series H
Preferred Stock; or (ii) converts shares of the Series H Preferred Stock
pursuant to the terms of the Company's Certificate of Designation of Series H
Preferred Stock and "9 Month Market Price" shall mean the average of the lowest
two (2) closing bid prices during the twenty (20) trading days for the Common
Stock prior to the 9 Month Date. Within ten (10) days of the 9 Month Date, the
Company shall provide written confirmation to the Holder of the number of shares
of Common Stock, as adjusted if applicable, which the Holder has the right to
purchase hereunder.
Holder agrees with the Company that this Warrant to Purchase Common
Stock of Viragen, Inc. (this "Warrant") is issued and all rights hereunder shall
be held subject to all of the conditions, limitations and provisions set forth
herein.
27
1. Date of Issuance.
This Warrant shall be deemed to be issued on February 17, 1998 ("Date
of Issuance").
2. Exercise.
(a) Manner of Exercise. During the Exercise Period, this Warrant may be
exercised as to all or any lesser number of full shares of Common Stock covered
hereby upon surrender of this Warrant, with the Exercise Form attached hereto as
Exhibit A (the "Exercise Form") duly completed and executed, together with the
full Exercise Price (as defined below) for each share of Common Stock as to
which this Warrant is exercised, at the office of the Company, ▇▇▇ ▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ Telephone No. (▇▇▇) ▇▇▇-▇▇▇▇,
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇ , or at such other office or agency as the Company
may designate in writing, by overnight mail, with an advance copy of the
Exercise Form sent to the Company and its Transfer Agent by facsimile (such
surrender and payment of the Exercise Price hereinafter called the "Exercise of
this Warrant").
(b) Date of Exercise. The "Date of Exercise" of the Warrant shall be
defined as the date that the advance copy of the completed and executed Exercise
Form is sent by facsimile to the Company, provided that the original Warrant and
Exercise Form are received by the Company as soon as practicable thereafter.
Alternatively, the Date of Exercise shall be defined as the date the original
Exercise Form is received by the Company, if Holder has not sent advance notice
by facsimile.
(c) Cancellation of Warrant. This Warrant shall be canceled upon the
Exercise of this Warrant, and, as soon as practical after the Date of Exercise,
Holder shall be entitled to receive Common Stock for the number of shares
purchased upon such Exercise of this Warrant, and if this Warrant is not
exercised in full, Holder shall be entitled to receive a new Warrant (containing
terms identical to this Warrant) representing any unexercised portion of this
Warrant in addition to such Common Stock.
(d) Holder of Record. Each person in whose name any Warrant for shares
of Common Stock is issued shall, for all purposes, be deemed to be the Holder of
record of such shares on the Date of Exercise of this Warrant, irrespective of
the date of delivery of the Common Stock purchased upon the Exercise of this
Warrant. Nothing in this Warrant shall be construed as conferring upon Holder
any rights as a stockholder of the Company.
3. Payment of Warrant Exercise Price.
The Exercise Price shall equal the 9 Month Market Price per share
("Exercise Price").
Payment of the Exercise Price may be made by either of the following,
or a combination thereof, at the election of Holder:
(a) Cash Exercise: cash, bank or cashiers check or wire transfer;
or
2
28
(b) Cashless Exercise: subject to the last sentence of this
Section 3, surrender of this Warrant at the principal office of the Company
together with notice of cashless election, in which event the Company shall
issue Holder a number of shares of Common Stock computed using the following
formula:
X = Y (A-B)/A
where: X = the number of shares of Common Stock to be issued to Holder.
Y = the number of shares of Common Stock for which this Warrant
is being exercised.
A = the Market Price of one (1) share of Common Stock (for purposes of
this Section 3(b), the "Market Price" shall be defined as the average
closing bid price of the Common Stock for the five (5) trading days
prior to the Date of Exercise of this Warrant (the "Average Closing
Price"), as reported by the National Association of Securities Dealers
Automated Quotation System ("Nasdaq") National Market System, or if the
Common Stock is not traded on the Nasdaq National Market System, the
Average Closing Price on the Nasdaq Small Cap Market or in any other
over-the-counter market on which the Common Stock is traded. If the
Common Stock is/was not traded during the five (5) trading days prior
to the Date of Exercise, then the closing price for the last publicly
traded day shall be deemed to be the closing price for any and all (if
applicable) days during such five (5) trading day period.
B = the Exercise Price.
For purposes of Rule 144 and sub-section (d)(3)(ii) thereof, it is intended,
understood and acknowledged that the Common Stock issuable upon exercise of this
Warrant in a cashless exercise transaction shall be deemed to have been acquired
at the time this Warrant was issued. Moreover, it is intended, understood and
acknowledged that the holding period for the Common Stock issuable upon exercise
of this Warrant in a cashless exercise transaction shall be deemed to have
commenced on the date this Warrant was issued.
Notwithstanding anything to the contrary contained herein, this Warrant may not
be exercised in a cashless exercise transaction if, on the Date of Exercise, the
shares of Common Stock to be issued upon exercise of this Warrant would upon
such issuance (x) be immediately transferable in the United States free of any
restrictive legend, including without limitation under Rule 144; (y) be then
registered pursuant to an effective registration statement filed pursuant to
that certain Registration Rights Agreement dated on or about February 17, 1998
by and among the Company and certain investors; or (z) otherwise be registered
under the Securities Act of 1933, as amended.
4. Transfer and Registration.
(a) Transfer Rights. Subject to the provisions of Section 8 of this
Warrant, this Warrant may be transferred on the books of the Company, in whole
or in part, in person or by attorney, upon surrender of this Warrant properly
completed and endorsed. This Warrant shall be canceled upon such surrender and,
as soon as practicable thereafter, the person to whom such transfer is made
shall be entitled to receive a new Warrant or Warrants as to the portion of this
Warrant transferred, and Holder shall be entitled to receive a new Warrant as to
the portion hereof retained.
(b) Registrable Securities. The Common Stock issuable upon the exercise
of this Warrant constitutes "Registrable Securities" under that certain
Registration Rights Agreement dated on or about February 17, 1998 between the
Company and certain
3
29
investors and, accordingly, has the benefit of the registration rights pursuant
to that agreement.
5. Anti-Dilution Adjustments.
(a) Stock Dividend. If the Company shall at any time declare a
dividend payable in shares of Common Stock, then Holder, upon Exercise of this
Warrant after the record date for the determination of holders of Common Stock
entitled to receive such dividend, shall be entitled to receive upon Exercise of
this Warrant, in addition to the number of shares of Common Stock as to which
this Warrant is exercised, such additional shares of Common Stock as such Holder
would have received had this Warrant been exercised immediately prior to such
record date and the Exercise Price will be proportionately adjusted.
(b) Recapitalization or Reclassification. If the Company shall at
any time effect a recapitalization, reclassification or other similar
transaction of such character that the shares of Common Stock shall be changed
into or become exchangeable for a larger or smaller number of shares, then upon
the effective date thereof, the number of shares of Common Stock which Holder
shall be entitled to purchase upon Exercise of this Warrant shall be increased
or decreased, as the case may be, in direct proportion to the increase or
decrease in the number of shares of Common Stock by reason of such
recapitalization, reclassification or similar transaction, and the Exercise
Price shall be, in the case of an increase in the number of shares,
proportionally decreased and, in the case of decrease in the number of shares,
proportionally increased. The Company shall give Holder the same notice it
provides to holders of Common Stock of any transaction described in this Section
5(b).
(c) Distributions. If the Company shall at any time distribute
for no consideration to holders of Common Stock cash, evidences of indebtedness
or other securities or assets (other than cash dividends or distributions
payable out of earned surplus or net profits for the current or preceding year)
then, in any such case, Holder shall be entitled to receive, upon Exercise of
this Warrant, with respect to each share of Common Stock issuable upon such
exercise, the amount of cash or evidences of indebtedness or other securities or
assets which Holder would have been entitled to receive with respect to each
such share of Common Stock as a result of the happening of such event had this
Warrant been exercised immediately prior to the record date or other date fixing
shareholders to be affected by such event (the "Determination Date") or, in lieu
thereof, if the Board of Directors of the Company should so determine at the
time of such distribution, a reduced Exercise Price determined by multiplying
the Exercise Price on the Determination Date by a fraction, the numerator of
which is the result of such Exercise Price reduced by the value of such
distribution applicable to one share of Common Stock (such value to be
determined by the Board of Directors of the Company in its discretion) and the
denominator of which is such Exercise Price.
(d) Notice of Consolidation or Merger. In the event of a merger,
consolidation, exchange of shares, recapitalization, reorganization, or other
similar event, as a result of which shares of Common Stock shall be changed into
the same or a different number of shares of the same or another class or classes
of stock or securities or other assets of the Company or another entity or there
is a sale of all or substantially all the Company's assets (a "Corporate
Change"), then this Warrant shall be exerciseable into such class and type of
securities or other assets as Holder would have received had Holder exercised
this Warrant immediately prior to such Corporate Change; provided, however, that
Company may not affect any Corporate Change unless it first shall have given
thirty (30) days notice to Holder hereof of any Corporate Change.
4
30
(e) Exercise Price Adjusted. As used in this Warrant, the term
"Exercise Price" shall mean the purchase price per share specified in Section 3
of this Warrant, until the occurrence of an event stated in subsection (a), (b)
or (c) of this Section 5, and thereafter shall mean said price as adjusted from
time to time in accordance with the provisions of said subsection. No such
adjustment under this Section 5 shall be made unless such adjustment would
change the Exercise Price at the time by $.01 or more; provided, however, that
all adjustments not so made shall be deferred and made when the aggregate
thereof would change the Exercise Price at the time by $.01 or more. No
adjustment made pursuant to any provision of this Section 5 shall have the net
effect of increasing the Exercise Price. The number of shares of Common Stock
subject hereto shall increase proportionately with each decrease in the Exercise
Price.
(f) Adjustments: Additional Shares, Securities or Assets. In the
event that at any time, as a result of an adjustment made pursuant to this
Section 5, Holder shall, upon Exercise of this Warrant, become entitled to
receive shares and/or other securities or assets (other than Common Stock) then,
wherever appropriate, all references herein to shares of Common Stock shall be
deemed to refer to and include such shares and/or other securities or assets;
and thereafter the number of such shares and/or other securities or assets shall
be subject to adjustment from time to time in a manner and upon terms as nearly
equivalent as practicable to the provisions of this Section 5.
6. Fractional Interests.
No fractional shares or scrip representing fractional shares
shall be issuable upon the Exercise of this Warrant, but on Exercise of this
Warrant, Holder may purchase only a whole number of shares of Common Stock. If,
on Exercise of this Warrant, Holder would be entitled to a fractional share of
Common Stock or a right to acquire a fractional share of Common Stock, such
fractional share shall be disregarded and the number of shares of Common Stock
issuable upon exercise shall be the next higher number of shares.
7. Reservation of Shares.
The Company shall at all times reserve for issuance such
number of authorized and unissued shares of Common Stock (or other securities
substituted therefor as herein above provided) as shall be sufficient for the
Exercise of this Warrant and payment of the Exercise Price. The Company
covenants and agrees that upon the Exercise of this Warrant, all shares of
Common Stock issuable upon such exercise shall be duly and validly issued, fully
paid, nonassessable and not subject to preemptive rights, rights of first
refusal or similar rights of any person or entity.
8. Restrictions on Transfer.
(a) Registration or Exemption Required. This Warrant has been
issued in a transaction exempt from the registration requirements of the Act by
virtue of Regulation D and exempt from state registration under applicable state
laws. The Warrant and the Common Stock issuable upon the Exercise of this
Warrant may not be pledged, transferred, sold or assigned except pursuant to an
effective registration statement or an exemption to the registration
requirements of the Act and applicable state laws.
(b) Assignment. If Holder can provide the Company with
reasonably satisfactory evidence that the conditions of (a) above regarding
registration or exemption have been satisfied, Holder may sell, transfer,
assign, pledge or otherwise dispose of this Warrant, in whole or in part. Holder
shall deliver a written notice to Company, substantially in the form of the
Assignment attached hereto as Exhibit B, indicating the person or persons to
whom the Warrant shall be assigned and the respective number of
5
31
warrants to be assigned to each assignee. The Company shall effect the
assignment within ten (10) days, and shall deliver to the assignee(s) designated
by Holder a Warrant or Warrants of like tenor and terms for the appropriate
number of shares.
9. Benefits of this Warrant.
Nothing in this Warrant shall be construed to confer upon any
person other than the Company and Holder any legal or equitable right, remedy or
claim under this Warrant and this Warrant shall be for the sole and exclusive
benefit of the Company and Holder.
10. Applicable Law.
This Warrant is issued under and shall for all purposes be
governed by and construed in accordance with the laws of the state of Delaware,
without giving effect to conflict of law provisions thereof.
11. Loss of Warrant.
Upon receipt by the Company of evidence of the loss, theft,
destruction or mutilation of this Warrant, and (in the case of loss, theft or
destruction) of indemnity or security reasonably satisfactory to the Company,
and upon surrender and cancellation of this Warrant, if mutilated, the Company
shall execute and deliver a new Warrant of like tenor and date.
12. Notice or Demands.
Notices or demands pursuant to this Warrant to be given or made by Holder to or
on the Company shall be sufficiently given or made if sent by certified or
registered mail, return receipt requested, postage prepaid, and addressed, until
another address is designated in writing by the Company, to Attention:
President, ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ Telephone
No. (▇▇▇) ▇▇▇-▇▇▇▇, Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇ . Notices or demands pursuant
to this Warrant to be given or made by the Company to or on Holder shall be
sufficiently given or made if sent by certified or registered mail, return
receipt requested, postage prepaid, and addressed, to the address of Holder set
forth in the Company's records, until another address is designated in writing
by Holder.
IN WITNESS WHEREOF, the undersigned has executed this Warrant as of
the ______ day of February, 1998.
VIRAGEN, INC.
By:
-------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Exec. Vice President/CFO
6
32
EXHIBIT A
EXERCISE FORM
TO: VIRAGEN, INC.
The undersigned hereby irrevocably exercises the right to purchase
____________ of the shares of Common Stock (the "Common Stock") of VIRAGEN,
INC., a Delaware corporation (the "Company"), evidenced by the attached warrant
(the "Warrant"), and herewith makes payment of the exercise price with respect
to such shares in full, all in accordance with the conditions and provisions of
said Warrant.
1. The undersigned agrees not to offer, sell, transfer or otherwise dispose of
any of the Common Stock obtained on exercise of the Warrant, except in
accordance with the provisions of Section 8(a) of the Warrant.
2. The undersigned requests that stock certificates for such shares be issued
free of any restrictive legend, if appropriate, and a warrant representing any
unexercised portion hereof be issued, pursuant to the Warrant in the name of the
undersigned and delivered to the undersigned at the address set forth below:
Dated:
------------------------------------------------------------------------
Signature
-----------------------------------------------------------------------
Print Name
------------------------------------------------------------------------
Address
-----------------------------------------------------------------------
NOTICE
The signature to the foregoing Exercise Form must correspond to the name as
written upon the face of the attached Warrant in every particular, without
alteration or enlargement or any change whatsoever.
------------------------------------------------------------------------
7
33
EXHIBIT B
ASSIGNMENT
(To be executed by the registered holder
desiring to transfer the Warrant)
FOR VALUE RECEIVED, the undersigned holder of the attached warrant (the
"Warrant") hereby sells, assigns and transfers unto the person or persons below
named the right to purchase _______ shares of the Common Stock of VIRAGEN, INC.,
evidenced by the attached Warrant and does hereby irrevocably constitute and
appoint _______________________ attorney to transfer the said Warrant on the
books of the Company, with full power of substitution in the premises.
Dated: ------------------------------
Signature
Fill in for new registration of Warrant:
-----------------------------------
Name
-----------------------------------
Address
-----------------------------------
Please print name and address of assignee
(including zip code number)
------------------------------------------------------------------------
NOTICE
The signature to the foregoing Assignment must correspond to the name as written
upon the face of the attached Warrant in every particular, without alteration or
enlargement or any change whatsoever.
------------------------------------------------------------------------
34
EXHIBIT B
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF OR EXERCISED UNLESS (i) A REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL
HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS
AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
"N" shares
"12 MONTH" WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that ________________ or any subsequent holder hereof
("Holder"), has the right to purchase from VIRAGEN, INC., a Delaware corporation
(the "Company"), up to "N" fully paid and nonassessable shares, wherein "N" is
defined below, of the Company's common stock, $.01 par value per share ("Common
Stock"), subject to adjustment as provided herein, at a price equal to the
Exercise Price as defined in Section 3 below, at any time beginning on the Date
of Issuance (as defined below) and ending at 5:00 p.m., New York, New York time,
on February 17, 2003 (the "Exercise Period"); provided, that "N" shall equal
fifteen percent (15%) of the quotient obtained when (i) the principal amount of
the Series H Preferred Stock purchased by Holder minus the principal amount of
any Series H Share Disposition, as defined below, that occurs prior to the
expiration of the date which is nine (12) months from the Date of Issuance (the
"12 Month Date"), is divided by (ii) the "12 Month Market Price", as defined
below. For purposes hereof, "Series H Share Disposition" shall mean a
transaction whereby the Holder either (i) transfers shares of the Series H
Preferred Stock; or (ii) converts shares of the Series H Preferred Stock
pursuant to the terms of the Company's Certificate of Designation of Series H
Preferred Stock and "12 Month Market Price" shall mean the average of the lowest
two (2) closing bid prices during the twenty (20) trading days for the Common
Stock prior to the 12 Month Date. Within ten (10) days of the 12 Month Date, the
Company shall provide written confirmation to the Holder of the number of shares
of Common Stock, as adjusted if applicable, which the Holder has the right to
purchase hereunder.
Holder agrees with the Company that this Warrant to Purchase Common
Stock of Viragen, Inc. (this "Warrant") is issued and all rights hereunder shall
be held subject to all of the conditions, limitations and provisions set forth
herein.
35
EXHIBIT C
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF OR EXERCISED UNLESS (i) A REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL
HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS
AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
"N" shares
"12 MONTH" WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that Global Bermuda Limited Partnership or any
subsequent holder hereof ("Holder"), has the right to purchase from VIRAGEN,
INC., a Delaware corporation (the "Company"), up to "N" fully paid and
nonassessable shares, wherein "N" is defined below, of the Company's common
stock, $.01 par value per share ("Common Stock"), subject to adjustment as
provided herein, at a price equal to the Exercise Price as defined in Section 3
below, at any time beginning on the Date of Issuance (as defined below) and
ending at 5:00 p.m., New York, New York time, on February 17, 2003 (the
"Exercise Period"); provided, that "N" shall equal fifteen percent (15%) of the
quotient obtained when (i) the principal amount of the Series H Preferred Stock
purchased by Holder minus the principal amount of any Series H Share
Disposition, as defined below, that occurs prior to the expiration of the date
which is nine (12) months from the Date of Issuance (the "12 Month Date"), is
divided by (ii) the "12 Month Market Price", as defined below. For purposes
hereof, "Series H Share Disposition" shall mean a transaction whereby the Holder
either (i) transfers shares of the Series H Preferred Stock; or (ii) converts
shares of the Series H Preferred Stock pursuant to the terms of the Company's
Certificate of Designation of Series H Preferred Stock and "12 Month Market
Price" shall mean the average of the lowest two (2) closing bid prices during
the twenty (20) trading days for the Common Stock prior to the 12 Month Date.
Within ten (10) days of the 12 Month Date, the Company shall provide written
confirmation to the Holder of the number of shares of Common Stock, as adjusted
if applicable, which the Holder has the right to purchase hereunder.
Holder agrees with the Company that this Warrant to Purchase Common
Stock of Viragen, Inc. (this "Warrant") is issued and all rights hereunder shall
be held subject to all of the conditions, limitations and provisions set forth
herein.
36
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF OR EXERCISED UNLESS (i) A REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL
HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS
AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
"N" shares
"12 MONTH" WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that Lakeshore International, Ltd. or any subsequent
holder hereof ("Holder"), has the right to purchase from VIRAGEN, INC., a
Delaware corporation (the "Company"), up to "N" fully paid and nonassessable
shares, wherein "N" is defined below, of the Company's common stock, $.01 par
value per share ("Common Stock"), subject to adjustment as provided herein, at a
price equal to the Exercise Price as defined in Section 3 below, at any time
beginning on the Date of Issuance (as defined below) and ending at 5:00 p.m.,
New York, New York time, on February 17, 2003 (the "Exercise Period"); provided,
that "N" shall equal fifteen percent (15%) of the quotient obtained when (i) the
principal amount of the Series H Preferred Stock purchased by Holder minus the
principal amount of any Series H Share Disposition, as defined below, that
occurs prior to the expiration of the date which is nine (12) months from the
Date of Issuance (the "12 Month Date"), is divided by (ii) the "12 Month Market
Price", as defined below. For purposes hereof, "Series H Share Disposition"
shall mean a transaction whereby the Holder either (i) transfers shares of the
Series H Preferred Stock; or (ii) converts shares of the Series H Preferred
Stock pursuant to the terms of the Company's Certificate of Designation of
Series H Preferred Stock and "12 Month Market Price" shall mean the average of
the lowest two (2) closing bid prices during the twenty (20) trading days for
the Common Stock prior to the 12 Month Date. Within ten (10) days of the 12
Month Date, the Company shall provide written confirmation to the Holder of the
number of shares of Common Stock, as adjusted if applicable, which the Holder
has the right to purchase hereunder.
Holder agrees with the Company that this Warrant to Purchase Common
Stock of Viragen, Inc. (this "Warrant") is issued and all rights hereunder shall
be held subject to all of the conditions, limitations and provisions set forth
herein.
37
EXHIBIT C
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF OR EXERCISED UNLESS (i) A REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL
HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS
AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
"N" shares
"12 MONTH" WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that ▇▇▇▇▇▇▇▇ Trading Group, LLC or any subsequent
holder hereof ("Holder"), has the right to purchase from VIRAGEN, INC., a
Delaware corporation (the "Company"), up to "N" fully paid and nonassessable
shares, wherein "N" is defined below, of the Company's common stock, $.01 par
value per share ("Common Stock"), subject to adjustment as provided herein, at a
price equal to the Exercise Price as defined in Section 3 below, at any time
beginning on the Date of Issuance (as defined below) and ending at 5:00 p.m.,
New York, New York time, on February 17, 2003 (the "Exercise Period"); provided,
that "N" shall equal fifteen percent (15%) of the quotient obtained when (i) the
principal amount of the Series H Preferred Stock purchased by Holder minus the
principal amount of any Series H Share Disposition, as defined below, that
occurs prior to the expiration of the date which is nine (12) months from the
Date of Issuance (the "12 Month Date"), is divided by (ii) the "12 Month Market
Price", as defined below. For purposes hereof, "Series H Share Disposition"
shall mean a transaction whereby the Holder either (i) transfers shares of the
Series H Preferred Stock; or (ii) converts shares of the Series H Preferred
Stock pursuant to the terms of the Company's Certificate of Designation of
Series H Preferred Stock and "12 Month Market Price" shall mean the average of
the lowest two (2) closing bid prices during the twenty (20) trading days for
the Common Stock prior to the 12 Month Date. Within ten (10) days of the 12
Month Date, the Company shall provide written confirmation to the Holder of the
number of shares of Common Stock, as adjusted if applicable, which the Holder
has the right to purchase hereunder.
Holder agrees with the Company that this Warrant to Purchase Common
Stock of Viragen, Inc. (this "Warrant") is issued and all rights hereunder shall
be held subject to all of the conditions, limitations and provisions set forth
herein.
38
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF OR EXERCISED UNLESS (i) A REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL
HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS
AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
"N" shares
"12 MONTH" WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that The Tail Wind Fund Ltd. or any subsequent holder
hereof ("Holder"), has the right to purchase from VIRAGEN, INC., a Delaware
corporation (the "Company"), up to "N" fully paid and nonassessable shares,
wherein "N" is defined below, of the Company's common stock, $.01 par value per
share ("Common Stock"), subject to adjustment as provided herein, at a price
equal to the Exercise Price as defined in Section 3 below, at any time beginning
on the Date of Issuance (as defined below) and ending at 5:00 p.m., New York,
New York time, on February 17, 2003 (the "Exercise Period"); provided, that "N"
shall equal fifteen percent (15%) of the quotient obtained when (i) the
principal amount of the Series H Preferred Stock purchased by Holder minus the
principal amount of any Series H Share Disposition, as defined below, that
occurs prior to the expiration of the date which is nine (12) months from the
Date of Issuance (the "12 Month Date"), is divided by (ii) the "12 Month Market
Price", as defined below. For purposes hereof, "Series H Share Disposition"
shall mean a transaction whereby the Holder either (i) transfers shares of the
Series H Preferred Stock; or (ii) converts shares of the Series H Preferred
Stock pursuant to the terms of the Company's Certificate of Designation of
Series H Preferred Stock and "12 Month Market Price" shall mean the average of
the lowest two (2) closing bid prices during the twenty (20) trading days for
the Common Stock prior to the 12 Month Date. Within ten (10) days of the 12
Month Date, the Company shall provide written confirmation to the Holder of the
number of shares of Common Stock, as adjusted if applicable, which the Holder
has the right to purchase hereunder.
Holder agrees with the Company that this Warrant to Purchase Common
Stock of Viragen, Inc. (this "Warrant") is issued and all rights hereunder shall
be held subject to all of the conditions, limitations and provisions set forth
herein.
39
1. Date of Issuance.
This Warrant shall be deemed to be issued on February 17, 1998 ("Date
of Issuance").
2. Exercise.
(a) Manner of Exercise. During the Exercise Period, this Warrant may be
exercised as to all or any lesser number of full shares of Common Stock covered
hereby upon surrender of this Warrant, with the Exercise Form attached hereto as
Exhibit A (the "Exercise Form") duly completed and executed, together with the
full Exercise Price (as defined below) for each share of Common Stock as to
which this Warrant is exercised, at the office of the Company, ▇▇▇ ▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ Telephone No. (▇▇▇) ▇▇▇-▇▇▇▇,
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇, or at such other office or agency as the Company
may designate in writing, by overnight mail, with an advance copy of the
Exercise Form sent to the Company and its Transfer Agent by facsimile (such
surrender and payment of the Exercise Price hereinafter called the "Exercise of
this Warrant").
(b) Date of Exercise. The "Date of Exercise" of the Warrant shall be
defined as the date that the advance copy of the completed and executed Exercise
Form is sent by facsimile to the Company, provided that the original Warrant and
Exercise Form are received by the Company as soon as practicable thereafter.
Alternatively, the Date of Exercise shall be defined as the date the original
Exercise Form is received by the Company, if Holder has not sent advance notice
by facsimile.
(c) Cancellation of Warrant. This Warrant shall be canceled upon the
Exercise of this Warrant, and, as soon as practical after the Date of Exercise,
Holder shall be entitled to receive Common Stock for the number of shares
purchased upon such Exercise of this Warrant, and if this Warrant is not
exercised in full, Holder shall be entitled to receive a new Warrant (containing
terms identical to this Warrant) representing any unexercised portion of this
Warrant in addition to such Common Stock.
(d) Holder of Record. Each person in whose name any Warrant for shares
of Common Stock is issued shall, for all purposes, be deemed to be the Holder of
record of such shares on the Date of Exercise of this Warrant, irrespective of
the date of delivery of the Common Stock purchased upon the Exercise of this
Warrant. Nothing in this Warrant shall be construed as conferring upon Holder
any rights as a stockholder of the Company.
3. Payment of Warrant Exercise Price.
The Exercise Price shall equal the 12 Month Market Price per share
("Exercise Price").
Payment of the Exercise Price may be made by either of the following,
or a combination thereof, at the election of Holder:
(a) Cash Exercise: cash, bank or cashiers check or wire transfer;
or
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40
(b) Cashless Exercise: subject to the last sentence of this
Section 3, surrender of this Warrant at the principal office of the Company
together with notice of cashless election, in which event the Company shall
issue Holder a number of shares of Common Stock computed using the following
formula:
X = Y (A-B)/A
where: X = the number of shares of Common Stock to be issued to Holder.
Y = the number of shares of Common Stock for which this Warrant
is being exercised.
A = the Market Price of one (1) share of Common Stock (for purposes of
this Section 3(b), the "Market Price" shall be defined as the average
closing bid price of the Common Stock for the five (5) trading days
prior to the Date of Exercise of this Warrant (the "Average Closing
Price"), as reported by the National Association of Securities Dealers
Automated Quotation System ("Nasdaq") National Market System, or if the
Common Stock is not traded on the Nasdaq National Market System, the
Average Closing Price on the Nasdaq Small Cap Market or in any other
over-the-counter market on which the Common Stock is traded. If the
Common Stock is/was not traded during the five (5) trading days prior
to the Date of Exercise, then the closing price for the last publicly
traded day shall be deemed to be the closing price for any and all (if
applicable) days during such five (5) trading day period).
B = the Exercise Price.
For purposes of Rule 144 and sub-section (d)(3)(ii) thereof, it is intended,
understood and acknowledged that the Common Stock issuable upon exercise of this
Warrant in a cashless exercise transaction shall be deemed to have been acquired
at the time this Warrant was issued. Moreover, it is intended, understood and
acknowledged that the holding period for the Common Stock issuable upon exercise
of this Warrant in a cashless exercise transaction shall be deemed to have
commenced on the date this Warrant was issued.
Notwithstanding anything to the contrary contained herein, this Warrant may not
be exercised in a cashless exercise transaction if, on the Date of Exercise, the
shares of Common Stock to be issued upon exercise of this Warrant would upon
such issuance (x) be immediately transferable in the United States free of any
restrictive legend, including without limitation under Rule 144; (y) be then
registered pursuant to an effective registration statement filed pursuant to
that certain Registration Rights Agreement dated on or about February 17, 1998
by and among the Company and certain investors; or (z) otherwise be registered
under the Securities Act of 1933, as amended.
4. Transfer and Registration.
(a) Transfer Rights. Subject to the provisions of Section 8 of this
Warrant, this Warrant may be transferred on the books of the Company, in whole
or in part, in person or by attorney, upon surrender of this Warrant properly
completed and endorsed. This Warrant shall be canceled upon such surrender and,
as soon as practicable thereafter, the person to whom such transfer is made
shall be entitled to receive a new Warrant or Warrants as to the portion of this
Warrant transferred, and Holder shall be entitled to receive a new Warrant as to
the portion hereof retained.
3
41
(b) Registrable Securities. The Common Stock issuable upon the exercise
of this Warrant constitutes "Registrable Securities" under that certain
Registration Rights Agreement dated on or about February 17, 1998 between the
Company and certain investors and, accordingly, has the benefit of the
registration rights pursuant to that agreement.
5. Anti-Dilution Adjustments.
(a) Stock Dividend. If the Company shall at any time declare a
dividend payable in shares of Common Stock, then Holder, upon Exercise of this
Warrant after the record date for the determination of holders of Common Stock
entitled to receive such dividend, shall be entitled to receive upon Exercise of
this Warrant, in addition to the number of shares of Common Stock as to which
this Warrant is exercised, such additional shares of Common Stock as such Holder
would have received had this Warrant been exercised immediately prior to such
record date and the Exercise Price will be proportionately adjusted.
(b) Recapitalization or Reclassification. If the Company shall at
any time effect a recapitalization, reclassification or other similar
transaction of such character that the shares of Common Stock shall be changed
into or become exchangeable for a larger or smaller number of shares, then upon
the effective date thereof, the number of shares of Common Stock which Holder
shall be entitled to purchase upon Exercise of this Warrant shall be increased
or decreased, as the case may be, in direct proportion to the increase or
decrease in the number of shares of Common Stock by reason of such
recapitalization, reclassification or similar transaction, and the Exercise
Price shall be, in the case of an increase in the number of shares,
proportionally decreased and, in the case of decrease in the number of shares,
proportionally increased. The Company shall give Holder the same notice it
provides to holders of Common Stock of any transaction described in this Section
5(b).
(c) Distributions. If the Company shall at any time distribute
for no consideration to holders of Common Stock cash, evidences of indebtedness
or other securities or assets (other than cash dividends or distributions
payable out of earned surplus or net profits for the current or preceding year)
then, in any such case, Holder shall be entitled to receive, upon Exercise of
this Warrant, with respect to each share of Common Stock issuable upon such
exercise, the amount of cash or evidences of indebtedness or other securities
or assets which Holder would have been entitled to receive with respect to each
such share of Common Stock as a result of the happening of such event had this
Warrant been exercised immediately prior to the record date or other date
fixing shareholders to be affected by such event (the "Determination Date") or,
in lieu thereof, if the Board of Directors of the Company should so determine
at the time of such distribution, a reduced Exercise Price determined by
multiplying the Exercise Price on the Determination Date by a fraction, the
numerator of which is the result of such Exercise Price reduced by the value of
such distribution applicable to one share of Common Stock (such value to be
determined by the Board of Directors of the Company in its discretion) and the
denominator of which is such Exercise Price.
(d) Notice of Consolidation or Merger. In the event of a merger,
consolidation, exchange of shares, recapitalization, reorganization, or other
similar event, as a result of which shares of Common Stock shall be changed into
the same or a different number of shares of the same or another class or classes
of stock or securities or other assets of the Company or another entity or there
is a sale of all or substantially all the Company's assets (a "Corporate
Change"), then this Warrant shall be exerciseable into such class and type of
securities or other assets as Holder would have received had Holder exercised
this Warrant immediately prior to such Corporate Change; provided, however, that
Company may not
4
42
affect any Corporate Change unless it first shall have given thirty (30) days
notice to Holder hereof of any Corporate Change.
(e) Exercise Price Adjusted. As used in this Warrant, the term
"Exercise Price" shall mean the purchase price per share specified in Section 3
of this Warrant, until the occurrence of an event stated in subsection (a), (b)
or (c) of this Section 5, and thereafter shall mean said price as adjusted from
time to time in accordance with the provisions of said subsection. No such
adjustment under this Section 5 shall be made unless such adjustment would
change the Exercise Price at the time by $.01 or more; provided, however, that
all adjustments not so made shall be deferred and made when the aggregate
thereof would change the Exercise Price at the time by $.01 or more. No
adjustment made pursuant to any provision of this Section 5 shall have the net
effect of increasing the Exercise Price. The number of shares of Common Stock
subject hereto shall increase proportionately with each decrease in the Exercise
Price.
(f) Adjustments: Additional Shares, Securities or Assets. In the
event that at any time, as a result of an adjustment made pursuant to this
Section 5, Holder shall, upon Exercise of this Warrant, become entitled to
receive shares and/or other securities or assets (other than Common Stock) then,
wherever appropriate, all references herein to shares of Common Stock shall be
deemed to refer to and include such shares and/or other securities or assets;
and thereafter the number of such shares and/or other securities or assets shall
be subject to adjustment from time to time in a manner and upon terms as nearly
equivalent as practicable to the provisions of this Section 5.
6. Fractional Interests.
No fractional shares or scrip representing fractional shares
shall be issuable upon the Exercise of this Warrant, but on Exercise of this
Warrant, Holder may purchase only a whole number of shares of Common Stock. If,
on Exercise of this Warrant, Holder would be entitled to a fractional share of
Common Stock or a right to acquire a fractional share of Common Stock, such
fractional share shall be disregarded and the number of shares of Common Stock
issuable upon exercise shall be the next higher number of shares.
7. Reservation of Shares.
The Company shall at all times reserve for issuance such
number of authorized and unissued shares of Common Stock (or other securities
substituted therefor as herein above provided) as shall be sufficient for the
Exercise of this Warrant and payment of the Exercise Price. The Company
covenants and agrees that upon the Exercise of this Warrant, all shares of
Common Stock issuable upon such exercise shall be duly and validly issued, fully
paid, nonassessable and not subject to preemptive rights, rights of first
refusal or similar rights of any person or entity.
8. Restrictions on Transfer.
(a) Registration or Exemption Required. This Warrant has been
issued in a transaction exempt from the registration requirements of the Act by
virtue of Regulation D and exempt from state registration under applicable state
laws. The Warrant and the Common Stock issuable upon the Exercise of this
Warrant may not be pledged, transferred, sold or assigned except pursuant to an
effective registration statement or an exemption to the registration
requirements of the Act and applicable state laws.
(b) Assignment. If Holder can provide the Company with
reasonably satisfactory evidence that the conditions of (a) above regarding
registration or exemption have been satisfied, Holder may sell, transfer,
assign, pledge or otherwise dispose of this
5
43
Warrant, in whole or in part. Holder shall deliver a written notice to Company,
substantially in the form of the Assignment attached hereto as Exhibit B,
indicating the person or persons to whom the Warrant shall be assigned and the
respective number of warrants to be assigned to each assignee. The Company shall
effect the assignment within ten (10) days, and shall deliver to the assignee(s)
designated by Holder a Warrant or Warrants of like tenor and terms for the
appropriate number of shares.
9. Benefits of this Warrant.
Nothing in this Warrant shall be construed to confer upon any
person other than the Company and Holder any legal or equitable right, remedy or
claim under this Warrant and this Warrant shall be for the sole and exclusive
benefit of the Company and Holder.
10. Applicable Law.
This Warrant is issued under and shall for all purposes be
governed by and construed in accordance with the laws of the state of Delaware,
without giving effect to conflict of law provisions thereof.
11. Loss of Warrant.
Upon receipt by the Company of evidence of the loss, theft,
destruction or mutilation of this Warrant, and (in the case of loss, theft or
destruction) of indemnity or security reasonably satisfactory to the Company,
and upon surrender and cancellation of this Warrant, if mutilated, the Company
shall execute and deliver a new Warrant of like tenor and date.
12. Notice or Demands.
Notices or demands pursuant to this Warrant to be given or made by Holder to or
on the Company shall be sufficiently given or made if sent by certified or
registered mail, return receipt requested, postage prepaid, and addressed, until
another address is designated in writing by the Company, to Attention:
President, ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ Telephone
No. (▇▇▇) ▇▇▇-▇▇▇▇, Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇ . Notices or demands pursuant
to this Warrant to be given or made by the Company to or on Holder shall be
sufficiently given or made if sent by certified or registered mail, return
receipt requested, postage prepaid, and addressed, to the address of Holder set
forth in the Company's records, until another address is designated in writing
by Holder.
IN WITNESS WHEREOF, the undersigned has executed this Warrant as of the
______ day of February, 1998.
VIRAGEN, INC.
By:
--------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Exec. Vice President/CFO
6
44
EXHIBIT A
EXERCISE FORM
TO: VIRAGEN, INC.
The undersigned hereby irrevocably exercises the right to purchase
____________ of the shares of Common Stock (the "Common Stock") of VIRAGEN,
INC., a Delaware corporation (the "Company"), evidenced by the attached warrant
(the "Warrant"), and herewith makes payment of the exercise price with respect
to such shares in full, all in accordance with the conditions and provisions of
said Warrant.
1. The undersigned agrees not to offer, sell, transfer or otherwise dispose of
any of the Common Stock obtained on exercise of the Warrant, except in
accordance with the provisions of Section 8(a) of the Warrant.
2. The undersigned requests that stock certificates for such shares be issued
free of any restrictive legend, if appropriate, and a warrant representing any
unexercised portion hereof be issued, pursuant to the Warrant in the name of the
undersigned and delivered to the undersigned at the address set forth below:
Dated:
------------------------------------------------------------------------
Signature
-----------------------------------------------------------------------
Print Name
------------------------------------------------------------------------
Address
-----------------------------------------------------------------------
NOTICE
The signature to the foregoing Exercise Form must correspond to the name as
written upon the face of the attached Warrant in every particular, without
alteration or enlargement or any change whatsoever.
------------------------------------------------------------------------
7
45
EXHIBIT B
ASSIGNMENT
(To be executed by the registered holder
desiring to transfer the Warrant)
FOR VALUE RECEIVED, the undersigned holder of the attached warrant (the
"Warrant") hereby sells, assigns and transfers unto the person or persons below
named the right to purchase _______ shares of the Common Stock of VIRAGEN, INC.,
evidenced by the attached Warrant and does hereby irrevocably constitute and
appoint _______________________ attorney to transfer the said Warrant on the
books of the Company, with full power of substitution in the premises.
Dated: ------------------------------
Signature
Fill in for new registration of Warrant:
-----------------------------------
Name
-----------------------------------
Address
-----------------------------------
Please print name and address of assignee
(including zip code number)
------------------------------------------------------------------------
NOTICE
The signature to the foregoing Assignment must correspond to the name as written
upon the face of the attached Warrant in every particular, without alteration or
enlargement or any change whatsoever.
------------------------------------------------------------------------
46
EXHIBIT C
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF OR EXERCISED UNLESS (i) A REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL
HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS
AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
"N" shares
"15 Month" Warrant to Purchase Common Stock
of
VIRAGEN, INC.
THIS CERTIFIES that ________________ or any subsequent holder hereof
("Holder"), has the right to purchase from VIRAGEN, INC., a Delaware corporation
(the "Company"), up to "N" fully paid and nonassessable shares, wherein "N" is
defined below, of the Company's common stock, $.01 par value per share ("Common
Stock"), subject to adjustment as provided herein, at a price equal to the
Exercise Price as defined in Section 3 below, at any time beginning on the Date
of Issuance (as defined below) and ending at 5:00 p.m., New York, New York time,
on February 17, 2003 (the "Exercise Period"); provided, that "N" shall equal
twenty percent (20%) of the quotient obtained when (i) the principal amount of
the Series H Preferred Stock purchased by Holder minus the principal amount of
any Series H Share Disposition, as defined below, that occurs prior to the
expiration of the date which is nine (15) months from the Date of Issuance (the
"15 Month Date"), is divided by (ii) the "15 Month Market Price", as defined
below. For purposes hereof, "Series H Share Disposition" shall mean a
transaction whereby the Holder either (i) transfers shares of the Series H
Preferred Stock; or (ii) converts shares of the Series H Preferred Stock
pursuant to the terms of the Company's Certificate of Designation of Series H
Preferred Stock and "15 Month Market Price" shall mean the average of the lowest
two (2) closing bid prices for the Common Stock during the twenty (20) trading
days prior to the 15 Month Date. Within ten (10) days of the 15 Month Date, the
Company shall provide written confirmation to the Holder of the number of shares
of Common Stock, as adjusted if applicable, which the Holder has the right to
purchase hereunder.
Holder agrees with the Company that this Warrant to Purchase Common
Stock of Viragen, Inc. (this "Warrant") is issued and all rights hereunder shall
be held subject to all of the conditions, limitations and provisions set forth
herein.
47
EXHIBIT D
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF OR EXERCISED UNLESS (i) A REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL
HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS
AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
"N" shares
"15 Month" Warrant to Purchase Common Stock
of
VIRAGEN, INC.
THIS CERTIFIES that Global Bermuda Limited Partnership or any
subsequent holder hereof ("Holder"), has the right to purchase from VIRAGEN,
INC., a Delaware corporation (the "Company"), up to "N" fully paid and
nonassessable shares, wherein "N" is defined below, of the Company's common
stock, $.01 par value per share ("Common Stock"), subject to adjustment as
provided herein, at a price equal to the Exercise Price as defined in Section 3
below, at any time beginning on the Date of Issuance (as defined below) and
ending at 5:00 p.m., New York, New York time, on February 17, 2003 (the
"Exercise Period"); provided, that "N" shall equal twenty percent (20%) of the
quotient obtained when (i) the principal amount of the Series H Preferred Stock
purchased by Holder minus the principal amount of any Series H Share
Disposition, as defined below, that occurs prior to the expiration of the date
which is nine (15) months from the Date of Issuance (the "15 Month Date"), is
divided by (ii) the "15 Month Market Price", as defined below. For purposes
hereof, "Series H Share Disposition" shall mean a transaction whereby the Holder
either (i) transfers shares of the Series H Preferred Stock; or (ii) converts
shares of the Series H Preferred Stock pursuant to the terms of the Company's
Certificate of Designation of Series H Preferred Stock and "15 Month Market
Price" shall mean the average of the lowest two (2) closing bid prices for the
Common Stock during the twenty (20) trading days prior to the 15 Month Date.
Within ten (10) days of the 15 Month Date, the Company shall provide written
confirmation to the Holder of the number of shares of Common Stock, as adjusted
if applicable, which the Holder has the right to purchase hereunder.
Holder agrees with the Company that this Warrant to Purchase Common
Stock of Viragen, Inc. (this "Warrant") is issued and all rights hereunder shall
be held subject to all of the conditions, limitations and provisions set forth
herein.
48
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF OR EXERCISED UNLESS (i) A REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL
HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS
AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
"N" shares
"15 Month" Warrant to Purchase Common Stock
of
VIRAGEN, INC.
THIS CERTIFIES that Lakeshore International, Ltd. or any subsequent
holder hereof ("Holder"), has the right to purchase from VIRAGEN, INC., a
Delaware corporation (the "Company"), up to "N" fully paid and nonassessable
shares, wherein "N" is defined below, of the Company's common stock, $.01 par
value per share ("Common Stock"), subject to adjustment as provided herein, at a
price equal to the Exercise Price as defined in Section 3 below, at any time
beginning on the Date of Issuance (as defined below) and ending at 5:00 p.m.,
New York, New York time, on February 17, 2003 (the "Exercise Period"); provided,
that "N" shall equal twenty percent (20%) of the quotient obtained when (i) the
principal amount of the Series H Preferred Stock purchased by Holder minus the
principal amount of any Series H Share Disposition, as defined below, that
occurs prior to the expiration of the date which is nine (15) months from the
Date of Issuance (the "15 Month Date"), is divided by (ii) the "15 Month Market
Price", as defined below. For purposes hereof, "Series H Share Disposition"
shall mean a transaction whereby the Holder either (i) transfers shares of the
Series H Preferred Stock; or (ii) converts shares of the Series H Preferred
Stock pursuant to the terms of the Company's Certificate of Designation of
Series H Preferred Stock and "15 Month Market Price" shall mean the average of
the lowest two (2) closing bid prices for the Common Stock during the twenty
(20) trading days prior to the 15 Month Date. Within ten (10) days of the 15
Month Date, the Company shall provide written confirmation to the Holder of the
number of shares of Common Stock, as adjusted if applicable, which the Holder
has the right to purchase hereunder.
Holder agrees with the Company that this Warrant to Purchase Common
Stock of Viragen, Inc. (this "Warrant") is issued and all rights hereunder shall
be held subject to all of the conditions, limitations and provisions set forth
herein.
49
EXHIBIT D
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF OR EXERCISED UNLESS (i) A REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL
HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS
AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
"N" shares
"15 Month" Warrant to Purchase Common Stock
of
VIRAGEN, INC.
THIS CERTIFIES that ▇▇▇▇▇▇▇▇ Trading Group, LLC or any subsequent
holder hereof ("Holder"), has the right to purchase from VIRAGEN, INC., a
Delaware corporation (the "Company"), up to "N" fully paid and nonassessable
shares, wherein "N" is defined below, of the Company's common stock, $.01 par
value per share ("Common Stock"), subject to adjustment as provided herein, at a
price equal to the Exercise Price as defined in Section 3 below, at any time
beginning on the Date of Issuance (as defined below) and ending at 5:00 p.m.,
New York, New York time, on February 17, 2003 (the "Exercise Period"); provided,
that "N" shall equal twenty percent (20%) of the quotient obtained when (i) the
principal amount of the Series H Preferred Stock purchased by Holder minus the
principal amount of any Series H Share Disposition, as defined below, that
occurs prior to the expiration of the date which is nine (15) months from the
Date of Issuance (the "15 Month Date"), is divided by (ii) the "15 Month Market
Price", as defined below. For purposes hereof, "Series H Share Disposition"
shall mean a transaction whereby the Holder either (i) transfers shares of the
Series H Preferred Stock; or (ii) converts shares of the Series H Preferred
Stock pursuant to the terms of the Company's Certificate of Designation of
Series H Preferred Stock and "15 Month Market Price" shall mean the average of
the lowest two (2) closing bid prices for the Common Stock during the twenty
(20) trading days prior to the 15 Month Date. Within ten (10) days of the 15
Month Date, the Company shall provide written confirmation to the Holder of the
number of shares of Common Stock, as adjusted if applicable, which the Holder
has the right to purchase hereunder.
Holder agrees with the Company that this Warrant to Purchase Common
Stock of Viragen, Inc. (this "Warrant") is issued and all rights hereunder shall
be held subject to all of the conditions, limitations and provisions set forth
herein.
50
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF OR EXERCISED UNLESS (i) A REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL
HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS
AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
"N" shares
"15 Month" Warrant to Purchase Common Stock
of
VIRAGEN, INC.
THIS CERTIFIES that The Tail Wind Fund Ltd. or any subsequent holder
hereof ("Holder"), has the right to purchase from VIRAGEN, INC., a Delaware
corporation (the "Company"), up to "N" fully paid and nonassessable shares,
wherein "N" is defined below, of the Company's common stock, $.01 par value per
share ("Common Stock"), subject to adjustment as provided herein, at a price
equal to the Exercise Price as defined in Section 3 below, at any time beginning
on the Date of Issuance (as defined below) and ending at 5:00 p.m., New York,
New York time, on February 17, 2003 (the "Exercise Period"); provided, that "N"
shall equal twenty percent (20%) of the quotient obtained when (i) the principal
amount of the Series H Preferred Stock purchased by Holder minus the principal
amount of any Series H Share Disposition, as defined below, that occurs prior to
the expiration of the date which is nine (15) months from the Date of Issuance
(the "15 Month Date"), is divided by (ii) the "15 Month Market Price", as
defined below. For purposes hereof, "Series H Share Disposition" shall mean a
transaction whereby the Holder either (i) transfers shares of the Series H
Preferred Stock; or (ii) converts shares of the Series H Preferred Stock
pursuant to the terms of the Company's Certificate of Designation of Series H
Preferred Stock and "15 Month Market Price" shall mean the average of the lowest
two (2) closing bid prices for the Common Stock during the twenty (20) trading
days prior to the 15 Month Date. Within ten (10) days of the 15 Month Date, the
Company shall provide written confirmation to the Holder of the number of shares
of Common Stock, as adjusted if applicable, which the Holder has the right to
purchase hereunder.
Holder agrees with the Company that this Warrant to Purchase Common
Stock of Viragen, Inc. (this "Warrant") is issued and all rights hereunder shall
be held subject to all of the conditions, limitations and provisions set forth
herein.
51
1. Date of Issuance.
This Warrant shall be deemed to be issued on February 17, 1998 ("Date
of Issuance").
2. Exercise.
(a) Manner of Exercise. During the Exercise Period, this Warrant may be
exercised as to all or any lesser number of full shares of Common Stock covered
hereby upon surrender of this Warrant, with the Exercise Form attached hereto as
Exhibit A (the "Exercise Form") duly completed and executed, together with the
full Exercise Price (as defined below) for each share of Common Stock as to
which this Warrant is exercised, at the office of the Company, ▇▇▇ ▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ Telephone No. (▇▇▇) ▇▇▇-▇▇▇▇,
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇ , or at such other office or agency as the Company
may designate in writing, by overnight mail, with an advance copy of the
Exercise Form sent to the Company and its Transfer Agent by facsimile (such
surrender and payment of the Exercise Price hereinafter called the "Exercise of
this Warrant").
(b) Date of Exercise. The "Date of Exercise" of the Warrant shall be
defined as the date that the advance copy of the completed and executed Exercise
Form is sent by facsimile to the Company, provided that the original Warrant and
Exercise Form are received by the Company as soon as practicable thereafter.
Alternatively, the Date of Exercise shall be defined as the date the original
Exercise Form is received by the Company, if Holder has not sent advance notice
by facsimile.
(c) Cancellation of Warrant. This Warrant shall be canceled upon the
Exercise of this Warrant, and, as soon as practical after the Date of Exercise,
Holder shall be entitled to receive Common Stock for the number of shares
purchased upon such Exercise of this Warrant, and if this Warrant is not
exercised in full, Holder shall be entitled to receive a new Warrant (containing
terms identical to this Warrant) representing any unexercised portion of this
Warrant in addition to such Common Stock.
(d) Holder of Record. Each person in whose name any Warrant for shares
of Common Stock is issued shall, for all purposes, be deemed to be the Holder of
record of such shares on the Date of Exercise of this Warrant, irrespective of
the date of delivery of the Common Stock purchased upon the Exercise of this
Warrant. Nothing in this Warrant shall be construed as conferring upon Holder
any rights as a stockholder of the Company.
3. Payment of Warrant Exercise Price.
The Exercise Price shall equal the 15 Month Market Price per share
("Exercise Price").
Payment of the Exercise Price may be made by either of the following,
or a combination thereof, at the election of Holder:
(a) Cash Exercise: cash, bank or cashiers check or wire transfer;
or
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52
(b) Cashless Exercise: subject to the last sentence of this Section 3,
surrender of this Warrant at the principal office of the Company together with
notice of cashless election, in which event the Company shall issue Holder a
number of shares of Common Stock computed using the following formula:
X = Y (A-B)/A
where: X = the number of shares of Common Stock to be issued to Holder.
Y = the number of shares of Common Stock for which this Warrant
is being exercised.
A = the Market Price of one (1) share of Common Stock (for purposes of
this Section 3(b), the "Market Price" shall be defined as the average
closing bid price of the Common Stock for the five (5) trading days
prior to the Date of Exercise of this Warrant (the "Average Closing
Price"), as reported by the National Association of Securities Dealers
Automated Quotation System ("Nasdaq") National Market System, or if the
Common Stock is not traded on the Nasdaq National Market System, the
Average Closing Price on the Nasdaq Small Cap Market or in any other
over-the-counter market on which the Common Stock is traded. If the
Common Stock is/was not traded during the five (5) trading days prior to
the Date of Exercise, then the closing price for the last publicly
traded day shall be deemed to be the closing price for any and all (if
applicable) days during such five (5) trading day period).
B = the Exercise Price.
For purposes of Rule 144 and sub-section (d)(3)(ii) thereof, it is intended,
understood and acknowledged that the Common Stock issuable upon exercise of this
Warrant in a cashless exercise transaction shall be deemed to have been acquired
at the time this Warrant was issued. Moreover, it is intended, understood and
acknowledged that the holding period for the Common Stock issuable upon exercise
of this Warrant in a cashless exercise transaction shall be deemed to have
commenced on the date this Warrant was issued.
Notwithstanding anything to the contrary contained herein, this Warrant may not
be exercised in a cashless exercise transaction if, on the Date of Exercise, the
shares of Common Stock to be issued upon exercise of this Warrant would upon
such issuance (x) be immediately transferable in the United States free of any
restrictive legend, including without limitation under Rule 144; (y) be then
registered pursuant to an effective registration statement filed pursuant to
that certain Registration Rights Agreement dated on or about February 17, 1998
by and among the Company and certain investors; or (z) otherwise be registered
under the Securities Act of 1933, as amended.
4. Transfer and Registration.
(a) Transfer Rights. Subject to the provisions of Section 8 of this
Warrant, this Warrant may be transferred on the books of the Company, in whole
or in part, in person or by attorney, upon surrender of this Warrant properly
completed and endorsed. This Warrant shall be canceled upon such surrender and,
as soon as practicable thereafter, the person to whom such transfer is made
shall be entitled to receive a new Warrant or Warrants as to the portion of this
Warrant transferred, and Holder shall be entitled to receive a new Warrant as to
the portion hereof retained.
(b) Registrable Securities. The Common Stock issuable upon the exercise
of this Warrant constitutes "Registrable Securities" under that certain
Registration Rights
3
53
Agreement dated on or about February 17, 1998 between the Company and certain
investors and, accordingly, has the benefit of the registration rights pursuant
to that agreement.
5. Anti-Dilution Adjustments.
(a) Stock Dividend. If the Company shall at any time declare a dividend
payable in shares of Common Stock, then Holder, upon Exercise of this Warrant
after the record date for the determination of holders of Common Stock entitled
to receive such dividend, shall be entitled to receive upon Exercise of this
Warrant, in addition to the number of shares of Common Stock as to which this
Warrant is exercised, such additional shares of Common Stock as such Holder
would have received had this Warrant been exercised immediately prior to such
record date and the Exercise Price will be proportionately adjusted.
(b) Recapitalization or Reclassification. If the Company shall at any
time effect a recapitalization, reclassification or other similar transaction of
such character that the shares of Common Stock shall be changed into or become
exchangeable for a larger or smaller number of shares, then upon the effective
date thereof, the number of shares of Common Stock which Holder shall be
entitled to purchase upon Exercise of this Warrant shall be increased or
decreased, as the case may be, in direct proportion to the increase or decrease
in the number of shares of Common Stock by reason of such recapitalization,
reclassification or similar transaction, and the Exercise Price shall be, in the
case of an increase in the number of shares, proportionally decreased and, in
the case of decrease in the number of shares, proportionally increased. The
Company shall give Holder the same notice it provides to holders of Common Stock
of any transaction described in this Section 5(b).
(c) Distributions. If the Company shall at any time distribute for no
consideration to holders of Common Stock cash, evidences of indebtedness or
other securities or assets (other than cash dividends or distributions payable
out of earned surplus or net profits for the current or preceding year) then, in
any such case, Holder shall be entitled to receive, upon Exercise of this
Warrant, with respect to each share of Common Stock issuable upon such exercise,
the amount of cash or evidences of indebtedness or other securities or assets
which Holder would have been entitled to receive with respect to each such share
of Common Stock as a result of the happening of such event had this Warrant been
exercised immediately prior to the record date or other date fixing shareholders
to be affected by such event (the "Determination Date") or, in lieu thereof, if
the Board of Directors of the Company should so determine at the time of such
distribution, a reduced Exercise Price determined by multiplying the Exercise
Price on the Determination Date by a fraction, the numerator of which is the
result of such Exercise Price reduced by the value of such distribution
applicable to one share of Common Stock (such value to be determined by the
Board of Directors of the Company in its discretion) and the denominator of
which is such Exercise Price.
(d) Notice of Consolidation or Merger. In the event of a merger,
consolidation, exchange of shares, recapitalization, reorganization, or other
similar event, as a result of which shares of Common Stock shall be changed into
the same or a different number of shares of the same or another class or classes
of stock or securities or other assets of the Company or another entity or there
is a sale of all or substantially all the Company's assets (a "Corporate
Change"), then this Warrant shall be exerciseable into such class and type of
securities or other assets as Holder would have received had Holder exercised
this Warrant immediately prior to such Corporate Change; provided, however, that
Company may not affect any Corporate Change unless it first shall have given
thirty (30) days notice to Holder hereof of any Corporate Change.
4
54
(e) Exercise Price Adjusted. As used in this Warrant, the term
"Exercise Price" shall mean the purchase price per share specified in Section 3
of this Warrant, until the occurrence of an event stated in subsection (a), (b)
or (c) of this Section 5, and thereafter shall mean said price as adjusted from
time to time in accordance with the provisions of said subsection. No such
adjustment under this Section 5 shall be made unless such adjustment would
change the Exercise Price at the time by $.01 or more; provided, however, that
all adjustments not so made shall be deferred and made when the aggregate
thereof would change the Exercise Price at the time by $.01 or more. No
adjustment made pursuant to any provision of this Section 5 shall have the net
effect of increasing the Exercise Price. The number of shares of Common Stock
subject hereto shall increase proportionately with each decrease in the Exercise
Price.
(f) Adjustments: Additional Shares, Securities or Assets. In the
event that at any time, as a result of an adjustment made pursuant to this
Section 5, Holder shall, upon Exercise of this Warrant, become entitled to
receive shares and/or other securities or assets (other than Common Stock) then,
wherever appropriate, all references herein to shares of Common Stock shall be
deemed to refer to and include such shares and/or other securities or assets;
and thereafter the number of such shares and/or other securities or assets shall
be subject to adjustment from time to time in a manner and upon terms as nearly
equivalent as practicable to the provisions of this Section 5.
6. Fractional Interests.
No fractional shares or scrip representing fractional shares
shall be issuable upon the Exercise of this Warrant, but on Exercise of this
Warrant, Holder may purchase only a whole number of shares of Common Stock. If,
on Exercise of this Warrant, Holder would be entitled to a fractional share of
Common Stock or a right to acquire a fractional share of Common Stock, such
fractional share shall be disregarded and the number of shares of Common Stock
issuable upon exercise shall be the next higher number of shares.
7. Reservation of Shares.
The Company shall at all times reserve for issuance such
number of authorized and unissued shares of Common Stock (or other securities
substituted therefor as herein above provided) as shall be sufficient for the
Exercise of this Warrant and payment of the Exercise Price. The Company
covenants and agrees that upon the Exercise of this Warrant, all shares of
Common Stock issuable upon such exercise shall be duly and validly issued, fully
paid, nonassessable and not subject to preemptive rights, rights of first
refusal or similar rights of any person or entity.
8. Restrictions on Transfer.
(a) Registration or Exemption Required. This Warrant has been
issued in a transaction exempt from the registration requirements of the Act by
virtue of Regulation D and exempt from state registration under applicable state
laws. The Warrant and the Common Stock issuable upon the Exercise of this
Warrant may not be pledged, transferred, sold or assigned except pursuant to an
effective registration statement or an exemption to the registration
requirements of the Act and applicable state laws.
(b) Assignment. If Holder can provide the Company with
reasonably satisfactory evidence that the conditions of (a) above regarding
registration or exemption have been satisfied, Holder may sell, transfer,
assign, pledge or otherwise dispose of this Warrant, in whole or in part. Holder
shall deliver a written notice to Company, substantially in the form of the
Assignment attached hereto as Exhibit B, indicating the
5
55
person or persons to whom the Warrant shall be assigned and the respective
number of warrants to be assigned to each assignee. The Company shall effect the
assignment within ten (10) days, and shall deliver to the assignee(s) designated
by Holder a Warrant or Warrants of like tenor and terms for the appropriate
number of shares.
9. Benefits of this Warrant.
Nothing in this Warrant shall be construed to confer upon any
person other than the Company and Holder any legal or equitable right, remedy or
claim under this Warrant and this Warrant shall be for the sole and exclusive
benefit of the Company and Holder.
10. Applicable Law.
This Warrant is issued under and shall for all purposes be
governed by and construed in accordance with the laws of the state of Delaware,
without giving effect to conflict of law provisions thereof.
11. Loss of Warrant.
Upon receipt by the Company of evidence of the loss, theft,
destruction or mutilation of this Warrant, and (in the case of loss, theft or
destruction) of indemnity or security reasonably satisfactory to the Company,
and upon surrender and cancellation of this Warrant, if mutilated, the Company
shall execute and deliver a new Warrant of like tenor and date.
12. Notice or Demands.
Notices or demands pursuant to this Warrant to be given or made by Holder to or
on the Company shall be sufficiently given or made if sent by certified or
registered mail, return receipt requested, postage prepaid, and addressed, until
another address is designated in writing by the Company, to Attention:
President, ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ Telephone
No. (▇▇▇) ▇▇▇-▇▇▇▇, Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇ . Notices or demands pursuant
to this Warrant to be given or made by the Company to or on Holder shall be
sufficiently given or made if sent by certified or registered mail, return
receipt requested, postage prepaid, and addressed, to the address of Holder set
forth in the Company's records, until another address is designated in writing
by Holder.
IN WITNESS WHEREOF, the undersigned has executed this Warrant as of the
______ day of February, 1998.
VIRAGEN, INC.
By:
-----------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Exec. Vice President/CFO
6
56
EXHIBIT A
EXERCISE FORM
TO: VIRAGEN, INC.
The undersigned hereby irrevocably exercises the right to purchase
____________ of the shares of Common Stock (the "Common Stock") of VIRAGEN,
INC., a Delaware corporation (the "Company"), evidenced by the attached warrant
(the "Warrant"), and herewith makes payment of the exercise price with respect
to such shares in full, all in accordance with the conditions and provisions of
said Warrant.
1. The undersigned agrees not to offer, sell, transfer or otherwise dispose of
any of the Common Stock obtained on exercise of the Warrant, except in
accordance with the provisions of Section 8(a) of the Warrant.
2. The undersigned requests that stock certificates for such shares be issued
free of any restrictive legend, if appropriate, and a warrant representing any
unexercised portion hereof be issued, pursuant to the Warrant in the name of the
undersigned and delivered to the undersigned at the address set forth below:
Dated:
-----------------------------------------------------------------------------
Signature
-----------------------------------------------------------------------------
Print Name
-----------------------------------------------------------------------------
Address
-----------------------------------------------------------------------------
NOTICE
The signature to the foregoing Exercise Form must correspond to the name as
written upon the face of the attached Warrant in every particular, without
alteration or enlargement or any change whatsoever.
-----------------------------------------------------------------------------
7
57
EXHIBIT B
ASSIGNMENT
(To be executed by the registered holder
desiring to transfer the Warrant)
FOR VALUE RECEIVED, the undersigned holder of the attached warrant (the
"Warrant") hereby sells, assigns and transfers unto the person or persons below
named the right to purchase _______ shares of the Common Stock of VIRAGEN, INC.,
evidenced by the attached Warrant and does hereby irrevocably constitute and
appoint _______________________ attorney to transfer the said Warrant on the
books of the Company, with full power of substitution in the premises.
Dated: -------------------
Signature
Fill in for new registration of Warrant:
----------------------------------------
Name
-----------------------------------------
Address
-----------------------------------------
Please print name and address of assignee
(including zip code number)
-------------------------------------------------------------------------------
NOTICE
The signature to the foregoing Assignment must correspond to the name as written
upon the face of the attached Warrant in every particular, without alteration or
enlargement or any change whatsoever.
-------------------------------------------------------------------------------
58
EXHIBIT D
THIS WARRANT AND THE SECURITIES RECEIVABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS (i) A REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME
EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN CONNECTION
WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
2,500 shares
WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ or any subsequent ("Holder")
hereof, has the right to purchase from VIRAGEN, INC., a Delaware corporation
(the "Company"), not more than 2,500 fully paid and nonassessable shares of the
Company's Common Stock, $.01 par value ("Common Stock"), at a price equal to the
Exercise Price as defined in Section 3 below, subject to adjustment as provided
herein, at any time on or before 5:00 p.m., Atlanta, Georgia time, on February
17, 2003.
The Holder of this Warrant agrees with the Company that this Warrant is
issued and all rights hereunder shall be held subject to all of the conditions,
limitations and provisions set forth herein.
1. Date of Issuance.
This Warrant shall be deemed to be issued on February 17, 1998 ("Date
of Issuance").
2. Exercise.
(a) Manner of Exercise. This Warrant may be exercised as to all or any
lesser number of full shares of Common Stock covered hereby upon surrender of
this Warrant, with the Exercise Form attached hereto duly completed and
executed, together with the full Exercise Price (as defined in Section 3) for
each share of Common Stock as to which this Warrant is exercised, at the office
of the Company, Viragen, Inc., ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President/CFO, Telephone No.
(▇▇▇) ▇▇▇-▇▇▇▇, Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇, or at such other office or agency
as the Company may designate in writing, by overnight mail, with
59
THIS WARRANT AND THE SECURITIES RECEIVABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS (i) A REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME
EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN CONNECTION
WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
2,000 shares
WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ or any subsequent ("Holder")
hereof, has the right to purchase from VIRAGEN, INC., a Delaware corporation
(the "Company"), not more than 2,000 fully paid and nonassessable shares of the
Company's Common Stock, $.01 par value ("Common Stock"), at a price equal to the
Exercise Price as defined in Section 3 below, subject to adjustment as provided
herein, at any time on or before 5:00 p.m., Atlanta, Georgia time, on February
17, 2003.
The Holder of this Warrant agrees with the Company that this Warrant is
issued and all rights hereunder shall be held subject to all of the conditions,
limitations and provisions set forth herein.
1. Date of Issuance.
This Warrant shall be deemed to be issued on February 17, 1998 ("Date
of Issuance").
2. Exercise.
(a) Manner of Exercise. This Warrant may be exercised as to all or any
lesser number of full shares of Common Stock covered hereby upon surrender of
this Warrant, with the Exercise Form attached hereto duly completed and
executed, together with the full Exercise Price (as defined in Section 3) for
each share of Common Stock as to which this Warrant is exercised, at the office
of the Company, Viragen, Inc., ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President/CFO, Telephone No.
(▇▇▇) ▇▇▇-▇▇▇▇, Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇, or at such other office or agency
as the Company may designate in writing, by overnight mail, with
60
THIS WARRANT AND THE SECURITIES RECEIVABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS (i) A REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME
EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN CONNECTION
WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
1,900 shares
WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ or any subsequent ("Holder")
hereof, has the right to purchase from VIRAGEN, INC., a Delaware corporation
(the "Company"), not more than 1,900 fully paid and nonassessable shares of the
Company's Common Stock, $.01 par value ("Common Stock"), at a price equal to the
Exercise Price as defined in Section 3 below, subject to adjustment as provided
herein, at any time on or before 5:00 p.m., Atlanta, Georgia time, on February
17, 2003.
The Holder of this Warrant agrees with the Company that this Warrant is
issued and all rights hereunder shall be held subject to all of the conditions,
limitations and provisions set forth herein.
1. Date of Issuance.
This Warrant shall be deemed to be issued on February 17, 1998 ("Date
of Issuance").
2. Exercise.
(a) Manner of Exercise. This Warrant may be exercised as to all or any
lesser number of full shares of Common Stock covered hereby upon surrender of
this Warrant, with the Exercise Form attached hereto duly completed and
executed, together with the full Exercise Price (as defined in Section 3) for
each share of Common Stock as to which this Warrant is exercised, at the office
of the Company, Viragen, Inc., ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President/CFO, Telephone No.
(▇▇▇) ▇▇▇-▇▇▇▇, Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇, or at such other office or agency
as the Company may designate in writing, by overnight mail, with
61
THIS WARRANT AND THE SECURITIES RECEIVABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS (i) A REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME
EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN CONNECTION
WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
20,057 shares
WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ or any subsequent ("Holder")
hereof, has the right to purchase from VIRAGEN, INC., a Delaware corporation
(the "Company"), not more than 20,057 fully paid and nonassessable shares of the
Company's Common Stock, $.01 par value ("Common Stock"), at a price equal to the
Exercise Price as defined in Section 3 below, subject to adjustment as provided
herein, at any time on or before 5:00 p.m., Atlanta, Georgia time, on February
17, 2003.
The Holder of this Warrant agrees with the Company that this Warrant is
issued and all rights hereunder shall be held subject to all of the conditions,
limitations and provisions set forth herein.
1. Date of Issuance.
This Warrant shall be deemed to be issued on February 17, 1998 ("Date
of Issuance").
2. Exercise.
(a) Manner of Exercise. This Warrant may be exercised as to all or any
lesser number of full shares of Common Stock covered hereby upon surrender of
this Warrant, with the Exercise Form attached hereto duly completed and
executed, together with the full Exercise Price (as defined in Section 3) for
each share of Common Stock as to which this Warrant is exercised, at the office
of the Company, Viragen, Inc., ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President/CFO, Telephone No.
(▇▇▇) ▇▇▇-▇▇▇▇, Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇, or at such other office or agency
as the Company may designate in writing, by overnight mail, with
62
THIS WARRANT AND THE SECURITIES RECEIVABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS (i) A REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME
EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN CONNECTION
WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
12,923 shares
WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ or any subsequent ("Holder")
hereof, has the right to purchase from VIRAGEN, INC., a Delaware corporation
(the "Company"), not more than 12,923 fully paid and nonassessable shares of the
Company's Common Stock, $.01 par value ("Common Stock"), at a price equal to the
Exercise Price as defined in Section 3 below, subject to adjustment as provided
herein, at any time on or before 5:00 p.m., Atlanta, Georgia time, on February
17, 2003.
The Holder of this Warrant agrees with the Company that this Warrant is
issued and all rights hereunder shall be held subject to all of the conditions,
limitations and provisions set forth herein.
1. Date of Issuance.
This Warrant shall be deemed to be issued on February 17, 1998 ("Date
of Issuance").
2. Exercise.
(a) Manner of Exercise. This Warrant may be exercised as to all or any
lesser number of full shares of Common Stock covered hereby upon surrender of
this Warrant, with the Exercise Form attached hereto duly completed and
executed, together with the full Exercise Price (as defined in Section 3) for
each share of Common Stock as to which this Warrant is exercised, at the office
of the Company, Viragen, Inc., ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President/CFO, Telephone No.
(▇▇▇) ▇▇▇-▇▇▇▇, Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇, or at such other office or agency
as the Company may designate in writing, by overnight mail, with
63
THIS WARRANT AND THE SECURITIES RECEIVABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS (i) A REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME
EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN CONNECTION
WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
3,000 shares
WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that ▇▇▇▇▇ ▇. ▇▇▇▇▇ or any subsequent ("Holder") hereof,
has the right to purchase from VIRAGEN, INC., a Delaware corporation (the
"Company"), not more than 3,000 fully paid and nonassessable shares of the
Company's Common Stock, $.01 par value ("Common Stock"), at a price equal to the
Exercise Price as defined in Section 3 below, subject to adjustment as provided
herein, at any time on or before 5:00 p.m., Atlanta, Georgia time, on February
17, 2003.
The Holder of this Warrant agrees with the Company that this Warrant is
issued and all rights hereunder shall be held subject to all of the conditions,
limitations and provisions set forth herein.
1. Date of Issuance.
This Warrant shall be deemed to be issued on February 17, 1998 ("Date
of Issuance").
2. Exercise.
(a) Manner of Exercise. This Warrant may be exercised as to all or any
lesser number of full shares of Common Stock covered hereby upon surrender of
this Warrant, with the Exercise Form attached hereto duly completed and
executed, together with the full Exercise Price (as defined in Section 3) for
each share of Common Stock as to which this Warrant is exercised, at the office
of the Company, Viragen, Inc., ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President/CFO, Telephone No.
(▇▇▇) ▇▇▇-▇▇▇▇, Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇, or at such other office or agency
as the Company may designate in writing, by overnight mail, with
64
THIS WARRANT AND THE SECURITIES RECEIVABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS (i) A REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME
EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN CONNECTION
WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
500 shares
WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ or any subsequent ("Holder")
hereof, has the right to purchase from VIRAGEN, INC., a Delaware corporation
(the "Company"), not more than 500 fully paid and nonassessable shares of the
Company's Common Stock, $.01 par value ("Common Stock"), at a price equal to the
Exercise Price as defined in Section 3 below, subject to adjustment as provided
herein, at any time on or before 5:00 p.m., Atlanta, Georgia time, on February
17, 2003.
The Holder of this Warrant agrees with the Company that this Warrant is
issued and all rights hereunder shall be held subject to all of the conditions,
limitations and provisions set forth herein.
1. Date of Issuance.
This Warrant shall be deemed to be issued on February 17, 1998 ("Date
of Issuance").
2. Exercise.
(a) Manner of Exercise. This Warrant may be exercised as to all or any
lesser number of full shares of Common Stock covered hereby upon surrender of
this Warrant, with the Exercise Form attached hereto duly completed and
executed, together with the full Exercise Price (as defined in Section 3) for
each share of Common Stock as to which this Warrant is exercised, at the office
of the Company, Viragen, Inc., ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President/CFO, Telephone No.
(▇▇▇) ▇▇▇-▇▇▇▇, Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇, or at such other office or agency
as the Company may designate in writing, by overnight mail, with
65
THIS WARRANT AND THE SECURITIES RECEIVABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS (i) A REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME
EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN CONNECTION
WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
500 shares
WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ or any subsequent ("Holder")
hereof, has the right to purchase from VIRAGEN, INC., a Delaware corporation
(the "Company"), not more than 500 fully paid and nonassessable shares of the
Company's Common Stock, $.01 par value ("Common Stock"), at a price equal to the
Exercise Price as defined in Section 3 below, subject to adjustment as provided
herein, at any time on or before 5:00 p.m., Atlanta, Georgia time, on February
17, 2003.
The Holder of this Warrant agrees with the Company that this Warrant is
issued and all rights hereunder shall be held subject to all of the conditions,
limitations and provisions set forth herein.
1. Date of Issuance.
This Warrant shall be deemed to be issued on February 17, 1998 ("Date
of Issuance").
2. Exercise.
(a) Manner of Exercise. This Warrant may be exercised as to all or any
lesser number of full shares of Common Stock covered hereby upon surrender of
this Warrant, with the Exercise Form attached hereto duly completed and
executed, together with the full Exercise Price (as defined in Section 3) for
each share of Common Stock as to which this Warrant is exercised, at the office
of the Company, Viragen, Inc., ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President/CFO, Telephone No.
(▇▇▇) ▇▇▇-▇▇▇▇, Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇, or at such other office or agency
as the Company may designate in writing, by overnight mail, with
66
THIS WARRANT AND THE SECURITIES RECEIVABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS (i) A REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME
EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN CONNECTION
WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
12,500 shares
WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇. or any subsequent
("Holder") hereof, has the right to purchase from VIRAGEN, INC., a Delaware
corporation (the "Company"), not more than 12,500 fully paid and nonassessable
shares of the Company's Common Stock, $.01 par value ("Common Stock"), at a
price equal to the Exercise Price as defined in Section 3 below, subject to
adjustment as provided herein, at any time on or before 5:00 p.m., Atlanta,
Georgia time, on February 17, 2003.
The Holder of this Warrant agrees with the Company that this Warrant is
issued and all rights hereunder shall be held subject to all of the conditions,
limitations and provisions set forth herein.
1. Date of Issuance.
This Warrant shall be deemed to be issued on February 17, 1998 ("Date
of Issuance").
2. Exercise.
(a) Manner of Exercise. This Warrant may be exercised as to all or any
lesser number of full shares of Common Stock covered hereby upon surrender of
this Warrant, with the Exercise Form attached hereto duly completed and
executed, together with the full Exercise Price (as defined in Section 3) for
each share of Common Stock as to which this Warrant is exercised, at the office
of the Company, Viragen, Inc., ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President/CFO, Telephone No.
(▇▇▇) ▇▇▇-▇▇▇▇, Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇, or at such other office or agency
as the Company may designate in writing, by overnight mail, with
67
THIS WARRANT AND THE SECURITIES RECEIVABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS (i) A REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME
EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN CONNECTION
WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
12,500 shares
WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ or any subsequent ("Holder")
hereof, has the right to purchase from VIRAGEN, INC., a Delaware corporation
(the "Company"), not more than 12,500 fully paid and nonassessable shares of the
Company's Common Stock, $.01 par value ("Common Stock"), at a price equal to the
Exercise Price as defined in Section 3 below, subject to adjustment as provided
herein, at any time on or before 5:00 p.m., Atlanta, Georgia time, on February
17, 2003.
The Holder of this Warrant agrees with the Company that this Warrant is
issued and all rights hereunder shall be held subject to all of the conditions,
limitations and provisions set forth herein.
1. Date of Issuance.
This Warrant shall be deemed to be issued on February 17, 1998 ("Date
of Issuance").
2. Exercise.
(a) Manner of Exercise. This Warrant may be exercised as to all or any
lesser number of full shares of Common Stock covered hereby upon surrender of
this Warrant, with the Exercise Form attached hereto duly completed and
executed, together with the full Exercise Price (as defined in Section 3) for
each share of Common Stock as to which this Warrant is exercised, at the office
of the Company, Viragen, Inc., ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President/CFO, Telephone No.
(▇▇▇) ▇▇▇-▇▇▇▇, Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇, or at such other office or agency
as the Company may designate in writing, by overnight mail, with
68
THIS WARRANT AND THE SECURITIES RECEIVABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS (i) A REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME
EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN CONNECTION
WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
8,000 shares
WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ or any subsequent ("Holder")
hereof, has the right to purchase from VIRAGEN, INC., a Delaware corporation
(the "Company"), not more than 8,000 fully paid and nonassessable shares of the
Company's Common Stock, $.01 par value ("Common Stock"), at a price equal to the
Exercise Price as defined in Section 3 below, subject to adjustment as provided
herein, at any time on or before 5:00 p.m., Atlanta, Georgia time, on February
17, 2003.
The Holder of this Warrant agrees with the Company that this Warrant is
issued and all rights hereunder shall be held subject to all of the conditions,
limitations and provisions set forth herein.
1. Date of Issuance.
This Warrant shall be deemed to be issued on February 17, 1998 ("Date
of Issuance").
2. Exercise.
(a) Manner of Exercise. This Warrant may be exercised as to all or any
lesser number of full shares of Common Stock covered hereby upon surrender of
this Warrant, with the Exercise Form attached hereto duly completed and
executed, together with the full Exercise Price (as defined in Section 3) for
each share of Common Stock as to which this Warrant is exercised, at the office
of the Company, Viragen, Inc., ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President/CFO, Telephone No.
(▇▇▇) ▇▇▇-▇▇▇▇, Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇, or at such other office or agency
as the Company may designate in writing, by overnight mail, with
69
THIS WARRANT AND THE SECURITIES RECEIVABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS (i) A REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME
EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN CONNECTION
WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
8,000 shares
WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that P. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or any subsequent ("Holder")
hereof, has the right to purchase from VIRAGEN, INC., a Delaware corporation
(the "Company"), not more than 8,000 fully paid and nonassessable shares of the
Company's Common Stock, $.01 par value ("Common Stock"), at a price equal to the
Exercise Price as defined in Section 3 below, subject to adjustment as provided
herein, at any time on or before 5:00 p.m., Atlanta, Georgia time, on February
17, 2003.
The Holder of this Warrant agrees with the Company that this Warrant is
issued and all rights hereunder shall be held subject to all of the conditions,
limitations and provisions set forth herein.
1. Date of Issuance.
This Warrant shall be deemed to be issued on February 17, 1998 ("Date
of Issuance").
2. Exercise.
(a) Manner of Exercise. This Warrant may be exercised as to all or any
lesser number of full shares of Common Stock covered hereby upon surrender of
this Warrant, with the Exercise Form attached hereto duly completed and
executed, together with the full Exercise Price (as defined in Section 3) for
each share of Common Stock as to which this Warrant is exercised, at the office
of the Company, Viragen, Inc., ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President/CFO, Telephone No.
(▇▇▇) ▇▇▇-▇▇▇▇, Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇, or at such other office or agency
as the Company may designate in writing, by overnight mail, with
70
THIS WARRANT AND THE SECURITIES RECEIVABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS (i) A REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME
EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN CONNECTION
WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
101,400 shares
WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that ▇▇▇▇▇▇▇▇ Family Partnership, LP or any subsequent
("Holder") hereof, has the right to purchase from VIRAGEN, INC., a Delaware
corporation (the "Company"), not more than 101,400 fully paid and nonassessable
shares of the Company's Common Stock, $.01 par value ("Common Stock"), at a
price equal to the Exercise Price as defined in Section 3 below, subject to
adjustment as provided herein, at any time on or before 5:00 p.m., Atlanta,
Georgia time, on February 17, 2003.
The Holder of this Warrant agrees with the Company that this Warrant is
issued and all rights hereunder shall be held subject to all of the conditions,
limitations and provisions set forth herein.
1. Date of Issuance.
This Warrant shall be deemed to be issued on February 17, 1998 ("Date
of Issuance").
2. Exercise.
(a) Manner of Exercise. This Warrant may be exercised as to all or any
lesser number of full shares of Common Stock covered hereby upon surrender of
this Warrant, with the Exercise Form attached hereto duly completed and
executed, together with the full Exercise Price (as defined in Section 3) for
each share of Common Stock as to which this Warrant is exercised, at the office
of the Company, Viragen, Inc., ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President/CFO, Telephone No.
(▇▇▇) ▇▇▇-▇▇▇▇, Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇, or at such other office or agency
as the Company may designate in writing, by overnight mail, with
71
THIS WARRANT AND THE SECURITIES RECEIVABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS (i) A REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME
EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN CONNECTION
WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
101,400 shares
WARRANT TO PURCHASE COMMON STOCK
OF
VIRAGEN, INC.
THIS CERTIFIES that ▇▇▇▇ ▇. ▇▇▇▇▇▇ or any subsequent ("Holder") hereof,
has the right to purchase from VIRAGEN, INC., a Delaware corporation (the
"Company"), not more than 101,400 fully paid and nonassessable shares of the
Company's Common Stock, $.01 par value ("Common Stock"), at a price equal to the
Exercise Price as defined in Section 3 below, subject to adjustment as provided
herein, at any time on or before 5:00 p.m., Atlanta, Georgia time, on February
17, 2003.
The Holder of this Warrant agrees with the Company that this Warrant is
issued and all rights hereunder shall be held subject to all of the conditions,
limitations and provisions set forth herein.
1. Date of Issuance.
This Warrant shall be deemed to be issued on February 17, 1998 ("Date
of Issuance").
2. Exercise.
(a) Manner of Exercise. This Warrant may be exercised as to all or any
lesser number of full shares of Common Stock covered hereby upon surrender of
this Warrant, with the Exercise Form attached hereto duly completed and
executed, together with the full Exercise Price (as defined in Section 3) for
each share of Common Stock as to which this Warrant is exercised, at the office
of the Company, Viragen, Inc., ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President/CFO, Telephone No.
(▇▇▇) ▇▇▇-▇▇▇▇, Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇, or at such other office or agency
as the Company may designate in writing, by overnight mail, with
72
THIS WARRANT AND THE SECURITIES RECEIVABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS (i) A REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME
EFFECTIVE WITH REGARD THERETO, OR (ii) AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN CONNECTION
WITH SUCH OFFER, SALE OR TRANSFER.
AN INVESTMENT IN THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE
HEREOF INVOLVES A HIGH DEGREE OF RISK. HOLDER MUST RELY ON HIS OWN ANALYSIS OF
THE INVESTMENT AND ASSESSMENT OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET
FORTH IN THE DISCLOSURE DOCUMENTS UNDER THAT CERTAIN SUBSCRIPTION AGREEMENT FOR
SERIES H PREFERRED STOCK BY AND BETWEEN THE COMPANY AND HOLDER REFERENCED
THEREIN AS EXHIBIT H.
Warrant to Purchase
_________ shares
Warrant to Purchase Common Stock
of
VIRAGEN, INC.
THIS CERTIFIES that ▇▇▇▇▇▇ Investments, LLC or any subsequent
("Holder") hereof, has the right to purchase from VIRAGEN, INC., a Delaware
corporation (the "Company"), not more than fully paid and nonassessable shares
of the Company's Common Stock, $.01 par value ("Common Stock"), at a price equal
to the Exercise Price as defined in Section 3 below, subject to adjustment as
provided herein, at any time on or before 5:00 p.m., Atlanta, Georgia time, on
February 17, 2003.
The Holder of this Warrant agrees with the Company that this Warrant is
issued and all rights hereunder shall be held subject to all of the conditions,
limitations and provisions set forth herein.
1. Date of Issuance.
This Warrant shall be deemed to be issued on February 17, 1998 ("Date
of Issuance").
2. Exercise.
(a) Manner of Exercise. This Warrant may be exercised as to all or any
lesser number of full shares of Common Stock covered hereby upon surrender of
this Warrant, with the Exercise Form attached hereto duly completed and
executed, together with the full Exercise Price (as defined in Section 3) for
each share of Common Stock as to which this Warrant is exercised, at the office
of the Company, Viragen, Inc., ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President/CFO, Telephone No.
(▇▇▇) ▇▇▇-▇▇▇▇, Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇, or at such other office or agency
as the Company may designate in writing, by overnight mail, with
12
73
an advance copy of the Exercise Form attached as Exhibit A ("Exercise Form")
sent by facsimile to the Company and its Transfer Agent (such surrender and
payment of the Exercise Price hereinafter called the "Exercise of this
Warrant").
(b) Date of Exercise. The "Date of Exercise" of the Warrant shall be
defined as the date that the advance copy of the completed and executed Exercise
Form is sent by facsimile to the Company and its Transfer Agent, provided that
the original Warrant and Exercise Form are received by the Company within five
(5) business days thereafter. The original Warrant and Exercise Form must be
received within five (5) business days of the Date of Exercise, or the exercise
may, at the Company's option, be considered void. Alternatively, the Date of
Exercise shall be defined as the date the original Exercise Form is received by
the Company, if Holder has not sent advance notice by facsimile.
(c) Cancellation of Warrant. This Warrant shall be canceled upon its
Exercise, and, as soon as practical after the Date of Exercise, the Holder
hereof shall be entitled to receive Common Stock for the number of shares
purchased upon such Exercise, and if this Warrant is not exercised in full, the
Holder shall be entitled to receive a new Warrant or Warrants (containing terms
identical to this Warrant) representing any unexercised portion of this Warrant
in addition to such Common Stock.
(d) Holder of Record. Each person in whose name any Warrant for shares
of Common Stock is issued shall, for all purposes, be deemed to have become the
Holder of record of such shares on the Date of Exercise of this Warrant,
irrespective of the date of delivery of such shares of Common Stock. Nothing in
this Warrant shall be construed as conferring upon the Holder hereof any rights
as a shareholder of the Company.
3. Payment of Warrant Exercise Price.
The Exercise Price ("Exercise Price") shall equal $1.684 ("Initial
Exercise Price") or, if the Date of Exercise is more than one (1) year after the
Date of Issuance, the lesser of (i) the Initial Exercise Price or (ii) the
"Lowest Reset Price", as that term is defined below. The Company shall calculate
a "Reset Price" on each anniversary date of the Date of Issuance which shall
equal one hundred percent (100%) of the average of the lowest two (2) Closing
Bid Prices of the Company's Common Stock for the twenty (20) trading days ending
on such anniversary date of the Date of Issuance. The "Lowest Reset Price" shall
equal the lowest Reset Price determined on an anniversary date of the Date of
Issuance preceding the Date of Exercise, taking into account, as appropriate,
any adjustments made pursuant to Section 5 hereof.
For purposes hereof, the term "Closing Bid Price" shall mean the
closing bid price on the National Association of Securities Dealers Automated
Quotation System ("Nasdaq") Small Cap Market or OTC Bulletin Board, or if no
longer traded on the Nasdaq Small Cap Market or OTC Bulletin Board, the closing
price on the principal national securities exchange or the over-the-counter
system on which the Common Stock is so traded and, if not available, the mean of
the high and low prices on the principal national securities exchange or the
National Securities Exchange on which the Common Stock is so traded.
Payment of the Exercise Price may be made by either of the following,
or a combination thereof, at the election of Holder:
(a) Cash Exercise: cash, bank or cashiers check or wire transfer; or
2
74
(b) Cashless Exercise: surrender of this Warrant at the principal
office of the Company together with notice of cashless election, in which event
the Company shall issue Holder a number of shares of Common Stock computed using
the following formula:
X = Y (A-B)/A
where: X = the number of shares of Common Stock to be issued to Holder.
Y = the number of shares of Common Stock for which this Warrant
is being exercised.
A = the Market Price of one (1) share of Common Stock (for purposes of
this Section 3(b), the "Market Price" shall be defined as the average
closing price of the Common Stock for the five (5) trading days prior
to the Date of Exercise of this Warrant (the "Average Closing Price"),
as reported by Nasdaq or if the Common Stock is not traded on Nasdaq,
the Average Closing Price in the over-the-counter market on which the
Common Stock is traded. If the Common Stock is/was not traded during
the five (5) trading days prior to the Date of Exercise, then the
closing price for the last publicly traded day shall be deemed to be
the closing price for any and all (if applicable) days during such five
(5) trading day period.
B = the Exercise Price.
For purposes of Rule 144 and sub-section (d)(3)(ii) thereof, it is intended,
understood and acknowledged that the Common Stock issuable upon exercise of this
Warrant in a cashless exercise transaction shall be deemed to have been acquired
at the time this Warrant was issued. Moreover, it is intended, understood and
acknowledged that the holding period for the Common Stock issuable upon exercise
of this Warrant in a cashless exercise transaction shall be deemed to have
commenced on the date this Warrant was issued.
4. Transfer and Registration.
(a) Transfer Rights. Subject to the provisions of Section 8 of this
Warrant, this Warrant may be transferred on the books of the Company, in whole
or in part, in person or by attorney, upon surrender of this Warrant properly
completed and endorsed. This Warrant shall be canceled upon such surrender and,
as soon as practicable thereafter, the person to whom such transfer is made
shall be entitled to receive a new Warrant or Warrants as to the portion of this
Warrant transferred, and the Holder of this Warrant shall be entitled to receive
a new Warrant or Warrants as to the portion hereof retained.
(b) Registrable Securities. The Common Stock issuable upon the exercise
of this Warrant constitute "Registrable Securities" under that certain
Registration Rights Agreement dated on or about February 17, 1998 by and between
the Company and ▇▇▇▇▇▇ Investments, LLC and, accordingly, has the benefit of the
registration rights pursuant to that agreement.
5. Anti-Dilution Adjustments.
(a) Stock Dividend. If the Company shall at any time declare a dividend
payable in shares of Common Stock, then the Holder hereof, upon Exercise of this
Warrant after the record date for the determination of Holders of Common Stock
entitled to receive such dividend, shall be entitled to receive upon Exercise of
this Warrant, in addition to the number of shares of Common Stock as to which
this Warrant is Exercised, such additional
3
75
shares of Common Stock as such Holder would have received had this Warrant been
Exercised immediately prior to such record date and the Exercise Price will be
proportionately adjusted.
(b) Recapitalization or Reclassification. If the Company shall at any
time effect a recapitalization, reclassification or other similar transaction of
such character that the shares of Common Stock shall be changed into or become
exchangeable for a larger or smaller number of shares, then upon the effective
date thereof, the number of shares of Common Stock which the Holder hereof shall
be entitled to purchase upon Exercise of this Warrant shall be increased or
decreased, as the case may be, in direct proportion to the increase or decrease
in the number of shares of Common Stock by reason of such recapitalization,
reclassification or similar transaction, and the Exercise Price shall be, in the
case of an increase in the number of shares, proportionally decreased and, in
the case of decrease in the number of shares, proportionally increased. The
Company shall give the Warrant Holder the same notice it provides to holders of
Common Stock of any transaction described in this Section 5(b).
(c) Distributions. If the Company shall at any time distribute to
Holders of Common Stock cash, evidences of indebtedness or other securities or
assets (other than cash dividends or distributions payable out of earned surplus
or net profits for the current or preceding year) then, in any such case, the
Holder of this Warrant shall be entitled to receive, upon exercise of this
Warrant, with respect to each share of Common Stock issuable upon such Exercise,
the amount of cash or evidences of indebtedness or other securities or assets
which such Holder would have been entitled to receive with respect to each such
share of Common Stock as a result of the happening of such event had this
Warrant been Exercised immediately prior to the record date or other date fixing
shareholders to be affected by such event (the "Determination Date") or, in lieu
thereof, if the Board of Directors of the Company should so determine at the
time of such distribution, a reduced Exercise Price determined by multiplying
the Exercise Price on the Determination Date by a fraction, the numerator of
which is the result of such Exercise Price reduced by the value of such
distribution applicable to one share of Common Stock (such value to be
determined by the Board in its discretion) and the denominator of which is such
Exercise Price.
(d) Notice of Consolidation or Merger. In the event of a merger,
consolidation, exchange of shares, recapitalization, reorganization, or other
similar event, as a result of which shares of Common Stock of the Company shall
be changed into the same or a different number of shares of the same or another
class or classes of stock or securities or other assets of the Company or
another entity or there is a sale of all or substantially all the Company's
assets (a "Corporate Change"), then this Warrant shall be assumed by the
acquiring entity or any affiliate thereof and thereafter this Warrant shall be
exerciseable into such class and type of securities or other assets as the
Holder would have received had the Holder exercised this Warrant immediately
prior to such Corporate Change; provided, however, that Company may not affect
any Corporate Change unless it first shall have given thirty (30) days notice to
the Holder hereof of any Corporate Change.
(e) Exercise Price Adjusted. As used in this Warrant, the term
"Exercise Price" shall mean the purchase price per share specified in Section 3
of this Warrant, as it may be reset from time to time, until the occurrence of
an event stated in subsection (a), (b) or (c) of this Section 5 and thereafter
shall mean said price as adjusted from time to time in accordance with the
provisions of said subsection. No such adjustment under this Section 5 shall be
made unless such adjustment would change the Exercise Price at the time by $.01
or more; provided, however, that all adjustments not so made shall be deferred
and made when the aggregate thereof would change the Exercise Price at the time
by $.01 or more.
4
76
No adjustment made pursuant to any provision of this Section 5 shall have the
effect of increasing the total consideration payable upon Exercise of this
Warrant in respect of all the Common Stock as to which this Warrant may be
exercised. Notwithstanding anything to the contrary contained herein, the
Exercise Price shall not be reduced to an amount below the par value of the
Common Stock.
(f) Adjustments: Additional Shares, Securities or Assets. In the
event that at any time, as a result of an adjustment made pursuant to this
Section 5, the Holder of this Warrant shall, upon Exercise of this Warrant,
become entitled to receive shares and/or other securities or assets (other than
Common Stock) then, wherever appropriate, all references herein to shares of
Common Stock shall be deemed to refer to and include such shares and/or other
securities or assets; and thereafter the number of such shares and/or other
securities or assets shall be subject to adjustment from time to time in a
manner and upon terms as nearly equivalent as practicable to the provisions of
this Section 5.
6. Fractional Interests.
No fractional shares or scrip representing fractional shares
shall be issuable upon the Exercise of this Warrant, but on Exercise of this
Warrant, the Holder hereof may purchase only a whole number of shares of Common
Stock. If, on Exercise of this Warrant, the Holder hereof would be entitled to a
fractional share of Common Stock or a right to acquire a fractional share of
Common Stock, such fractional share shall be disregarded and the number of
shares of Common Stock issuable upon conversion shall be the next higher number
of shares.
7. Reservation of Shares.
The Company shall at all times reserve for issuance such
number of authorized and unissued shares of Common Stock (or other securities
substituted therefor as herein above provided) as shall be sufficient for
Exercise and payment of the Exercise Price of this Warrant. The Company
covenants and agrees that upon Exercise of this Warrant, all shares of Common
Stock issuable upon such Exercise shall be duly and validly issued, fully paid,
nonassessable and not subject to preemptive rights, rights of first refusal or
similar rights of any person or entity.
8. Restrictions on Transfer.
(a) Registration or Exemption Required. This Warrant and the
Common Stock issuable on Exercise hereof have not been registered under the
Securities Act of 1933, as amended, and may not be sold, assigned, transferred,
pledged, hypothecated or otherwise disposed of in the absence of registration or
the availability of an exemption from registration under said Act. All shares of
Common Stock issued upon Exercise of this Warrant shall bear an appropriate
legend to such effect, if applicable.
(b) Assignment. Assuming the conditions of (a) above regarding
registration or exemption have been satisfied, the Holder may sell, transfer,
assign, pledge or otherwise dispose of this Warrant, in whole or in part. Holder
shall deliver a written notice to Company, substantially in the form of the
Assignment attached hereto as Exhibit B, indicating the person or persons to
whom the Warrant shall be assigned and the respective number of warrants to be
assigned to each assignee. The Company shall effect the assignment within ten
days, and shall deliver to the assignee(s) designated by Holder a Warrant or
Warrants of like tenor and terms for the appropriate number of shares.
5
77
(c) Investment Intent. The Warrant and Common Stock issuable upon
conversion are intended to be held for investment purposes and not with an
intent to distribution, as defined in the Act.
9. Benefits of this Warrant.
Nothing in this Warrant shall be construed to confer upon any
person other than the Company and the Holder of this Warrant any legal or
equitable right, remedy or claim under this Warrant and this Warrant shall be
for the sole and exclusive benefit of the Company and the Holder of this
Warrant.
10. Applicable Law.
This Warrant is issued under and shall for all purposes be governed
by and construed in accordance with the laws of the state of Georgia, without
giving effect to conflict of law provisions thereof.
11. Loss of Warrant.
Upon receipt by the Company of evidence of the loss, theft,
destruction or mutilation of this Warrant, and (in the case of loss, theft or
destruction) of indemnity or security reasonably satisfactory to the Company,
and upon surrender and cancellation of this Warrant, if mutilated, the Company
shall execute and deliver a new Warrant of like tenor and date.
12. Notice or Demands.
Notices or demands pursuant to this Warrant to be given or made by the Holder of
this Warrant to or on the Company shall be sufficiently given or made if sent by
certified or registered mail, return receipt requested, postage prepaid, and
addressed, until another address is designated in writing by the Company,
Viragen, Inc., ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President/CFO, Telephone No. (▇▇▇) ▇▇▇-▇▇▇▇,
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇. Notices or demands pursuant to this Warrant to be
given or made by the Company to or on the Holder of this Warrant shall be
sufficiently given or made if sent by certified or registered mail, return
receipt requested, postage prepaid, and addressed, Attn: Holder, address: c/▇
▇▇▇▇▇▇ Investments, LLC, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, until another address is designated in writing by
Holder.
IN WITNESS WHEREOF, the undersigned has executed this Warrant as of
the ____ day of February, ____ 1998.
VIRAGEN, INC.
By:
----------------------------------
Print Name:
--------------------------------
Title:
--------------------------------
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EXHIBIT A
EXERCISE FORM
TO: ___________________.
The undersigned hereby irrevocably exercises the right to purchase
____________ of the shares of Common Stock of VIRAGEN, INC., a Delaware
corporation, evidenced by the attached Warrant, and herewith makes payment of
the Exercise Price with respect to such shares in full, all in accordance with
the conditions and provisions of said Warrant.
The undersigned agrees not to offer, sell, transfer or otherwise
dispose of any of such Common Stock, except in accordance with the provisions of
Section 8 of the Warrant, and consents that the following legend may be affixed
to the stock certificates for the Common Stock hereby subscribed for, if such
legend is applicable:
"The securities represented hereby have not been registered under the
Securities Act of 1933, as amended (the "Securities Act"), or any
provincial or state securities law, and may not be sold, transferred,
pledged, hypothecated or otherwise disposed of until either (i) a
registration statement under the Securities Act and applicable
provincial or state securities laws shall have become effective with
regard thereto, or (ii) an exemption from registration under the
Securities Act or applicable provincial or state securities laws is
available in connection with such offer, sale or transfer."
The undersigned requests that stock certificates for such shares be
issued, and a warrant representing any unexercised portion hereof be issued,
pursuant to the Warrant in the name of the Registered Holder and delivered to
the undersigned at the address set forth below:
Dated:
-------------------------------------------------------------------------------
Signature of Registered Holder
-------------------------------------------------------------------------------
Name of Registered Holder (Print)
-------------------------------------------------------------------------------
Address
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
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EXHIBIT B
ASSIGNMENT
(To be executed by the registered Holder
desiring to transfer the Warrant)
FOR VALUE RECEIVED, the undersigned Holder of the attached Warrant hereby sells,
assigns and transfers unto the person or persons below named the right to
purchase _______ shares of the Common Stock of VIRAGEN, INC. evidenced by the
attached Warrant and does hereby irrevocably constitute and appoint
_______________________ attorney to transfer the said Warrant on the books of
the Company, with full power of substitution in the premises.
Dated:
--------------------------------
Signature
Fill in for new Registration of Warrant:
------------------------------------------
Name
------------------------------------------
Address
------------------------------------------
Please print name and address of assignee
(including zip code number)
-------------------------------------------------------------------------------
NOTICE
The signature to the foregoing Exercise Form or Assignment must correspond to
the name as written upon the face of the attached Warrant in every particular,
without alteration or enlargement or any change whatsoever.
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REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT ("Agreement") is entered into as of
February __, 1998, by and among Viragen, Inc., a corporation duly incorporated
and existing under the laws of the State of Delaware ("Company"), ▇▇▇▇▇▇
Investments, LLC ("▇▇▇▇▇▇"), a Georgia limited liability company, and the
subscribers (hereinafter referred to as "Subscribers") to the Company's Offering
("Offering") of up to Five Million Dollars ($5,000,000) of Preferred Stock (the
"Preferred Stock") pursuant to the Regulation D Subscription Agreement between
the Company and each of the Subscribers ("Subscription Agreement").
1. DEFINITIONS. For purposes of this Agreement:
(a) The terms "register," "registered," and "registration"
refer to a registration effected by preparing and filing a registration
statement or similar document in compliance with the Securities Act of 1933 (the
"Act"), and pursuant to Rule 415 under the Act or any successor rule, and the
declaration or ordering of effectiveness of such registration statement or
document;
(b) For purposes hereof, the term "Registrable Securities"
means the shares of the Company's Common Stock together with any capital stock
issued in replacement of, in exchange for or otherwise in respect of such Common
Stock (the "Common Stock"), issuable or issued upon (i) conversion of the
Preferred Stock, (ii) exercise of the warrants to purchase Common Stock to be
issued to the Subscribers in connection with the Offering (the "Subscriber
Warrants") and (iii) exercise of the Warrant to purchase Common stock issued to
▇▇▇▇▇▇ or to persons designated by ▇▇▇▇▇▇ in connection with the Offering (the
"Placement Agent Warrant", together with the Subscriber Warrants, collectively
referred to as the "Warrants"), by ▇▇▇▇▇▇, its designees or any subsequent
Holder of the Warrant or portion thereof.
Notwithstanding the above:
1. Common Stock which would otherwise be deemed to be
Registrable Securities shall not constitute Registrable
Securities if and to the extent that those shares of Common
Stock may be resold in a public transaction without volume
limitations or other material restrictions without
registration under the Act, including without limitation,
pursuant to Rule 144 under the Act; and
2. any Registrable Securities resold in a public transaction
shall cease to constitute Registrable Securities.
(c) The number of shares of "Registrable Securities then
outstanding" shall be determined by the number of shares of Common Stock which
have been issued or are issuable upon conversion of the Preferred Stock and
exercise of the then outstanding Warrants at the time of such determination;
(d) The term "Holder" means any person owning or having the
right to acquire Registrable Securities or any permitted assignee thereof;
(e) The term "Initiating Holders" means (i) one or more
holders of Registrable Securities obtained or obtainable upon conversion of at
least Fifty (50) shares of Preferred Stock; and
(f) The term "Filing Date" means the date which is two (2)
months after the Last Closing Date (as defined in the Certificate of Designation
of the Series H Preferred Stock) and the term "Due Date" means the date which is
four (4) months after the Last Closing Date of the Offering.
EXHIBIT E
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2. REQUIRED REGISTRATION.
(a) The Company shall file, by the Filing Date, a registration
statement ("Registration Statement") on Form S-3 (or other suitable form, at the
Company's discretion, but subject to the reasonable approval of Subscribers),
covering the resale of all shares of Registrable Securities then outstanding or
issuable upon conversion of all then outstanding Preferred Stock or upon
exercise of the Warrants. Such Registration Statement shall initially cover the
number of shares issuable upon exercise of the Placement Agent Warrant plus at
least Seven Million Two Hundred Thousand (7,200,000) shares of Common Stock and
(including SEC Rule 416), shall state such Registration Statement also covers
such indeterminate number of additional shares of Common Stock as may become
issuable upon conversion of the Preferred Stock and the exercise of the Warrants
(i) to prevent dilution resulting from stock splits, stock dividends or similar
transactions or (ii) by reason of changes in the Conversion Price of the
Preferred Stock or the Exercise Price of the Warrants in accordance with the
terms thereof, as the case may be. The Company shall use its best efforts to
have the Registration Statement declared effective as soon as possible. In the
event that the Company determines, which determination shall be made by the
Company within five (5) business days after the last business day of each month
after the Due Date or is notified at any time by a Holder, that the Registration
Statement does not cover a sufficient number of shares of Common Stock to effect
the resales of a number of shares of Common Stock equal to one hundred twenty
five percent (125%) of the number of shares of Common Stock issuable to each
Subscriber upon conversion of all outstanding Preferred Stock then eligible for
conversion, at the Conversion Price (as defined in the Certificate of
Designation of the Series A Preferred Stock) in effect on the last business day
of such month (the "Assumed Conversion Price"), and upon exercise of all the
outstanding Warrants (a "Registration Shortfall"), the Company shall, within
five (5) business days, amend the Registration Statement or file a new
Registration Statement (an "Amended" or "New" Registration Statement,
respectively), as appropriate, to add such number of additional shares as would
be necessary to effect the resales of a number of shares of Common Stock equal
to at least one hundred fifty percent (150%) of the number of shares of Common
Stock issuable to each Subscriber upon conversion of all outstanding Preferred
Stock then eligible for conversion, at the Assumed Conversion Price then in
effect and upon exercise of all the outstanding Warrants. If the Registration
Statement is not filed by the Filing Date, Company shall pay the Subscribers an
amount equal to two percent (2%) per month of the aggregate amount of
outstanding Preferred Stock held by Subscriber, accruing daily until the
Registration Statement is filed, payable in cash or Common Stock, at the
Subscriber's option, as set forth below ("Late Filing Payment"). If the
Registration Statement is not declared effective by the Due Date, or if any
Amended or New Registration Statement required to be filed hereunder is not
declared effective within two (2) calendar months of the date it is required to
be filed, the Company shall pay the Subscribers an amount equal to two percent
(2%) per month of the aggregate amount of outstanding Preferred Stock held by
Subscriber, accruing daily until the Registration Statement or a registration
statement filed pursuant to Section 3 of this Agreement is declared effective
(the "Late Registration Payment"). Any Late Filing Payment or Late Registration
Payment shall be payable in cash or Common Stock, at the Subscriber's option, as
follows: If Subscriber elects to be paid in cash, such late Filing Payment or
Late Registration Payment shall be paid to such Subscriber within five (5)
business days following the end of the month in which such Late Registration
Payment was accrued. If Subscriber elects to be paid in Common Stock, such
number of shares shall be determined as follows:
Upon conversion of each share of Preferred Stock, the Company shall
issue to the Subscriber the number of shares of Common Stock determined
as set forth in Section 5(a) of the Certificate of Designation, plus an
additional number of shares of Common Stock attributable to such share
of Preferred Stock (the "Additional Shares") determined as set forth
below:
Additional Shares = Late Registration Payment + Late Filing Payment
-----------------------------------------------
Conversion Price
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With respect to the Preferred Stock, "Conversion Price" has the definition
ascribed to it in the Certificate of Designation.
Such Additional Shares shall also be deemed "Registrable Securities" as defined
herein. The Company covenants to use its best efforts to use Form S-3 (or other
suitable form, at the Company's discretion, but subject to the reasonable
approval of the Subscribers) for the registration required by this Section
during all applicable times contemplated by this Agreement.
(b) The Registration Statement shall be prepared as a "shelf"
registration statement under Rule 415, and shall be maintained effective until
all Registrable Securities cease to exist.
(c) The Company represents that it is presently eligible to
effect the registration contemplated hereby on Form S-3 and will use its best
efforts to continue to take such actions as are necessary to maintain such
eligibility.
3. PIGGYBACK REGISTRATION. If the Registration Statement
described in Section 2 is not effective by the Due Date, and if (but without any
obligation to do so) the Company proposes to register (including for this
purpose a registration effected by the Company for shareholders other than the
Holders) any of its Common Stock under the Act in connection with the public
offering of such securities solely for cash (other than a registration relating
solely for the sale of securities to participants in a Company stock plan or a
registration on Form S-4 promulgated under the Act or any successor or similar
form registering stock issuable upon a reclassification, upon a business
combination involving an exchange of securities or upon an exchange offer for
securities of the issuer or another entity), the Company shall, at such time,
promptly give each Holder written notice of such registration (a "Piggyback
Registration Statement"). Upon the written request of each Holder given by fax
within ten (10) days after mailing of such notice by the Company, the Company
shall cause to be included in such registration statement under the Act all of
the Registrable Securities that each such Holder has requested to be registered
("Piggyback Registration") to the extent such inclusion does not violate the
registration rights of any other security holder of the company granted prior to
the date hereof; nothing herein shall prevent the Company from withdrawing or
abandoning the registration statement prior to its effectiveness. The election
of initiating Holders to participate in a Piggyback Registration Statement shall
not impact the amount payable to investors pursuant to Section 2(a) herein
except that the Late Registration Payment shall cease to accrue, as of the date
of effectiveness of the Piggyback Registration Statement, on a percentage of the
initiating Holders' Preferred Stock equal to the number of shares of Common
Stock included in the Piggyback Registration Statement divided by 7,200,000.
4. LIMITATION ON OBLIGATIONS TO REGISTER.
(a) In the case of a Piggyback Registration on an underwritten
public offering by the Company, if the managing underwriter determines and
advises in writing that the inclusion in the registration statement of all
Registrable Securities proposed to be included would interfere with the
successful marketing of the securities proposed to be registered by the Company,
then the number of such Registrable Securities to be included in the
registration statement, to the extent such Registrable Securities may be
included in such Piggyback Registration Statement shall be allocated among all
Holders who had requested Piggyback Registration pursuant to the terms hereof,
in the proportion that the number of Registrable Securities which each such
Holder, including ▇▇▇▇▇▇, seeks to register bears to the total number of
Registrable Securities sought to be included by all Holders, including ▇▇▇▇▇▇.
If required by the managing underwriter of such an underwritten public offering,
the Holders shall enter into a reasonable agreement limiting the
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number of Registrable Securities to be included in such Piggyback Registration
Statement and the terms, if any, regarding the future sale of such Registrable
Securities.
(b) In the event the Company believes that shares sought to be
registered under Section 2 or Section 3 by Holders do not constitute
"Registrable Securities" by virtue of Section 1(b) of this Agreement, and the
status of those shares as Registrable Securities is disputed, the Company shall
provide, at its expense, an Opinion of Counsel, reasonably acceptable to the
Holders of the Securities at issue (and satisfactory to the Company's transfer
agent to permit the sale and transfer) that those securities may be sold
immediately, without volume limitation or other material restrictions, without
registration under the Act, by virtue of Rule 144 or similar provisions.
5. OBLIGATIONS OF THE COMPANY. Whenever required under this
Agreement to effect the registration of any Registrable Securities, the Company
shall, as expeditiously as reasonably possible:
(a) Prepare and file with the Securities and Exchange
Commission ("SEC") a registration statement with respect to such Registrable
Securities and use its best efforts to cause such registration statement to
become effective and to remain effective for the applicable period.
(b) Prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in connection
with such registration statement as may be necessary to comply with the
provisions of the Act with respect to the disposition of all securities covered
by such registration statement.
(c) Furnish to the Holders such numbers of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Securities Act, and such other documents as they may
reasonably request in order to facilitate the disposition of Registrable
Securities owned by them.
(d) Use its best efforts to register and qualify the
securities covered by such registration statement under such other securities or
Blue Sky laws of such jurisdictions as shall be reasonably requested by the
Holders of the Registrable Securities covered by such registration statement,
provided that the Company shall not be required in connection therewith or as a
condition thereto to qualify to do business or to file a general consent to
service of process in any such states or jurisdictions.
(e) In the event of any underwritten public offering, enter
into and perform its obligations under an underwriting agreement, in usual and
customary form, with the managing underwriter of such offering. Each Holder
participating in such underwriting shall also enter into and perform its
obligations under such an agreement.
(f) As promptly as practicable after becoming aware of such
event, notify each Holder of Registrable Securities of the happening of any
event of which the Company has knowledge, as a result of which the prospectus
included in the registration statement, as then in effect, includes an untrue
statement of a material fact or omits to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, and subject to Section
6 use its best efforts promptly to prepare a supplement or amendment to the
registration statement to correct such untrue statement or omission, and deliver
a number of copies of such supplement or amendment to each Holder as such Holder
may reasonably request.
(g) Provide Holders with written notice of the date that a
registration statement registering the resale of the Registrable Securities is
declared effective by the SEC, and the date or dates when the Registration
Statement is no longer effective.
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(h) Provide Holders and their representatives the opportunity
to conduct a reasonable due diligence inquiry of Company's pertinent financial
and other records and make available its officers, directors and employees for
questions regarding such information as it relates to information contained in
the registration statement.
(i) Provide Holders and their representatives the opportunity
to review the registration statement and all amendments thereto a reasonable
period of time prior to their filing with the SEC if so requested by Holder in
writing and to consider reasonable comments from the Holders given within five
(5) business days of the date such statement was received by the Holder.
(j) Provide each Holder with prompt notice of the assurance by
the SEC or any state securities commission or agency of any stop order
suspending the effectiveness of the registration statement or the initiation of
any proceeding for such purpose. The Company shall use its best efforts to
prevent the issuance of any stop order, and, if any is issued to obtain the
removal thereof at the earliest possible date.
(k) Use its best efforts to list the Registrable Securities
covered by the registration statement with all securities exchanges or markets
on which the Common Stock is then listed and prepare and file any required
filing with the NASD or any such exchange or market.
6. BLACK OUT. In the event that, during the time that the
Registration Statement is effective, the Company reasonably determines, based
upon advice of counsel, that due to the existence of material non-public
information, disclosure of such material non-public information would be
required to make the statements contained in the Registration Statement not
misleading, and the Company has a bona fide business purpose for preserving as
confidential such material non-public information, the Company shall have the
right to suspend the effectiveness of the Registration Statement, and no Holder
shall be permitted to sell any Registrable Securities pursuant thereto, until
such time as such suspension is no longer advisable; provided, however, that
such time shall not exceed a period of sixty (60) days. If the Company attempts
to exceed such sixty (60) day limit, the Late Registration Payments shall
accrue. As soon as such suspension is no longer advisable, the Company shall, if
required, promptly, but in no event later than the date the Company files any
documents with the Securities and Exchange Commission ("SEC") referencing such
material information, file with the SEC an amendment to the Registration
Statement disclosing such information and use its best efforts to have such
amendment declared effective as soon as possible.
In the event the effectiveness of the Registration
Statement is suspended by the Company pursuant hereto, the Company shall
promptly notify all Holders whose securities are covered by the Registration
Statement of such suspension, and shall promptly notify each such Holder as soon
as the effectiveness of the Registration Statement has been resumed. The Company
shall be entitled to effect no more than one such suspension during the one (1)
year period following the Last Closing.
7. FURNISH INFORMATION. It shall be a condition precedent to
the obligations of the Company to take any action pursuant to this Agreement
with regard to each selling Holder that such selling Holder shall furnish to the
Company such information regarding Holder, the Registrable Securities held by
it, and the intended method of disposition of such securities as shall be
required to effect the registration of its Registrable Securities or to
determine that registration is not required pursuant to Rule 144 or other
applicable provision of the Act.
8. EXPENSES. All expenses other than underwriting discounts
and commissions and fees and expenses of counsel to the selling Holders incurred
in connection with registrations, filings or qualifications pursuant hereto,
including (without limitation) all
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registration, filing and qualification fees, printers' and accounting fees, fees
and disbursements of counsel for the Company, shall be borne by the Company.
9. INDEMNIFICATION. In the event any Registrable Securities
are included in a Registration Statement or a Piggyback Registration Statement
under this Agreement:
(a) To the extent permitted by law, the Company will indemnify
and hold harmless each Holder, the officers and directors of each Holder, any
underwriter (as defined in the Act) for such Holder and each person, if any, who
controls such Holder or underwriter within the meaning of the Act or the
Securities Exchange Act of 1934, as amended (the "1934 Act"), against any
losses, claims, damages, or liabilities (joint or several) to which they may
become subject under the Act, the 1934 Act or other federal or state law,
insofar as such losses, claims, damages, or liabilities (or actions in respect
thereof) arise out of or are based upon any of the following statements or
omissions: (i) any untrue statement or alleged untrue statement of a material
fact contained in such registration statement, including any preliminary
prospectus or final prospectus contained therein or any amendments or
supplements thereto, or (ii) the omission or alleged omission to state therein a
material fact required to be stated therein, or necessary to make the statements
therein not misleading, and the Company will reimburse each such Holder, officer
or director, underwriter or controlling person for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability, or action; provided, however, that the
indemnity agreement contained in this subsection 9(a) shall not apply to amounts
paid in settlement of any such loss, claim, damage, liability, or action if such
settlement is effected without the consent of the Company (which consent shall
not be unreasonably withheld), nor shall the Company be liable in any such case
for any such loss, claim, damage, liability, or action to the extent that it
arises out of or is based upon a Violation which occurs in reliance upon and in
conformity with written information furnished expressly for use in connection
with such registration by any such Holder, officer, director, underwriter or
controlling person.
(b) To the extent permitted by law, each selling Holder,
severally and not jointly, will indemnify and hold harmless the Company, each of
its directors, each of its officers who have signed the registration statement,
each person, if any, who controls the Company within the meaning of the Act, any
underwriter and any other Holder selling securities in such registration
statement or any of its directors or officers or any person who controls such
Holder, against any losses, claims, damages, or liabilities (joint or several)
to which the Company or any such director, officer, controlling person, or
underwriter or controlling person, or other such Holder or director, officer or
controlling person may become subject, under the Act, the 1934 Act or other
federal or state law, insofar as such losses, claims, damages, or liabilities
(or actions in respect thereto) arise out of or are based upon any statement or
omission in each case to the extent (and only to the extent) that such statement
or omission is made in reliance upon and in conformity with written information
furnished by such Holder expressly for use in connection with such registration
statement; and each such Holder will reimburse any legal or other expenses
reasonably incurred by the Company and any such director, officer, controlling
person, underwriter or controlling person, other Holder, officer, director, or
controlling person in connection with investigating or defending any such loss,
claim, damage, liability, or action; provided, however, that the indemnity
agreement contained in this subsection 9(b) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Holder, which consent shall
not be unreasonably withheld.
(c) Promptly after receipt by an indemnified party under this
Section 9 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made against any indemnifying party under this Section 9, deliver to
the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense
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thereof with counsel mutually satisfactory to the parties; provided, however,
that an indemnified party shall have the right to retain its own counsel, with
the reasonably incurred fees and expenses of one such counsel to be paid by the
indemnifying party, if representation of such indemnified party by the counsel
retained by the indemnifying party would be inappropriate due to actual or
potential conflicting interests between such indemnified party and any other
party represented by such counsel in such proceeding. The failure to deliver
written notice to the indemnifying party within a reasonable time of the
commencement of any such action, if prejudicial to its ability to defend such
action, shall relieve such indemnifying party of any liability to the
indemnified party under this Section 9, but the omission so to deliver written
notice to the indemnifying party will not relieve it of any liability that it
may have to any indemnified party otherwise than under this Section 9.
(d) In the event that the indemnity provided in paragraph (a)
or (b) of this Section 9 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company and each Holder agree to
contribute to the aggregate claims, losses, damages and liabilities (including
legal or other expenses reasonably incurred in connection with investigating or
defending same) (collectively "Losses") to which the Company and one or more of
the Holder may be subject in such proportion as is appropriate to reflect the
relative fault of the Company and the Holders in connection with the statements
or omissions which resulted in such Losses. Relative fault shall be determined
by reference to whether any alleged untrue statement or omission relates to
information provided by the Company or by the Holders. The Company and the
Holders agree that it would not be just and equitable if contribution were
determined by pro rata allocation or any other method of allocation which does
not take account of the equitable considerations referred to above.
Notwithstanding the provisions of this paragraph (d), no person guilty of
fraudulent misrepresentation (within the meaning of Section 10(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. For purposes of this Section 9,
each person who controls a Holder of Registrable Securities within the meaning
of either the Securities Act or the Exchange Act and each director, officer,
partner, employee and agent of a Holder shall have the same rights to
contribution as such holder, and each person who controls the Company within the
meaning of either the Act or the Exchange Act and each director of the Company,
and each officer of the Company who has signed the registration statement, shall
have the same rights to contribution as the Company, subject in each case to the
applicable terms and conditions of this paragraph (d).
(e) The obligations of the Company and Holders under this
Section 9 shall survive the redemption and conversion, if any, of the Preferred
Stock, the completion of any offering of Registrable Securities in a
Registration Statement under this Agreement, and otherwise.
(f) If the Registration Statement or any Piggyback
Registration involves an underwritten offering, the Company shall enter into
such customary agreements for secondary offerings (including a customary
underwriting agreement with the underwriter or underwriters) and take all such
other reasonable actions reasonably requested by the Holders in connection
therewith in order to expedite or facilitate the disposition of such Registrable
Securities and in such connection:
(i) make such representations and warranties to the
Holders and the underwriter or underwriters in form, substance and scope as are
customarily made by issuers to underwriters in secondary offerings;
(ii) cause to be delivered to the sellers of Registrable
Securities and the underwriter or underwriters opinions of independent counsel
to Company on and dated as of the date of delivery of any Registrable Securities
sold pursuant to the Registration Statement, which counsel and opinions (in
form, scope and substance) shall be reasonably satisfactory to the Holders and
the underwriter(s) and their counsel and covering, without limitation, such
matters as the due authorization and issuance of the securities being registered
and compliance with securities
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laws by Company in connection with the authorization, issuance and registration
thereof and other matters that are customarily given to underwriters in
underwritten offerings, addressed to the Holders and each underwriter;
(iii) if required by the underwriters, cause to be
delivered, immediately prior to the effectiveness of the Registration Statement
and at the time of delivery of any Registrable Securities sold pursuant
thereto, a "comfort" letter from Company's independent certified public
accountants addressed to the Holders and each underwriter stating that such
accountants are independent public accountants within the meaning of the
Securities Act and the applicable published rules and regulations thereunder,
and otherwise in customary form and covering such financial and accounting
matters as are customarily covered by letters of the independent certified
public accountants delivered in connection with secondary offerings;
(iv) the underwriting agreement shall include customary
indemnification and contribution provisions to and from the underwriters and
procedures for secondary underwritten offerings; and
(v) deliver such documents and certificates as may be
reasonably requested by the Holders of the Registrable Securities being sold or
the managing underwriter or underwriters to evidence compliance with clause (i)
above and with any customary conditions contained in the underwriting agreement.
10. REPORTS UNDER SECURITIES EXCHANGE ACT OF 1934. With a view to
making available to the Holders the benefits of Rule 144 promulgated under the
Act and any other rule or regulation of the SEC that may at any time permit a
Holder to sell securities of the Company to the public without registration, the
Company agrees to:
(a) make and keep public information available, as those terms are
understood and defined in Rule 144;
(b) use its best efforts to file with the SEC in a timely manner
all reports and other documents required of the Company under the Act and the
1934 Act; and
11. AMENDMENT OF REGISTRATION RIGHTS. Any provision of this
Agreement may be amended and the observance thereof may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and the Holders of
a majority of the Registrable Securities provided that the amendment treats all
Holders equally. Any amendment or waiver effected in accordance with this
paragraph shall be binding upon each Holder, each future Holder, and the
Company.
12. NOTICES. All notices required or permitted under this Agreement
shall be made in writing signed by the party making the same, shall specify the
section under this Agreement pursuant to which it is given, and shall be
addressed if to (i) the Company at: Viragen, Inc., ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ Telephone No. (▇▇▇) ▇▇▇-▇▇▇▇, Facsimile No.
(▇▇▇) ▇▇▇-▇▇▇▇ and (ii) the Holders at their respective last address as the
party as shown on the records of the Company. Any notice, except as otherwise
provided in this Agreement, shall be made by fax and shall be deemed given at
the time of transmission of the fax.
13. TERMINATION. This Agreement shall terminate on the date all
Registrable Securities cease to exist; but without prejudice to (i) the parties'
rights and obligations arising from breaches of this Agreement occurring prior
to such termination (ii) other indemnification obligations under this Agreement.
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14. ASSIGNMENT. No assignment, transfer or delegation, whether
by operation of law or otherwise, of any rights or obligations under this
Agreement by the Company or any Holder, respectively, shall be made without the
prior written consent of the majority in interest of the Holders or the Company,
respectively; provided that the rights of a Holder may be transferred to a
subsequent holder of the Holder's Registrable Securities (provided such
transferee shall provide to the Company, together with or prior to such
transferee's request to have such Registrable Securities included in a Piggyback
Registration, a writing executed by such transferee agreeing to be bound as a
Holder by the terms of this Agreement), and the Company hereby agrees to file a
new registration statement or an amended registration statement including such
transferee or a selling security holder thereunder; and provided further that
the Company may transfer its rights and obligations under this Agreement to a
purchaser of all or a substantial portion of its business if the obligations of
the Company under this Agreement are assumed in connection with such transfer,
either by merger or other operation of law (which may include without limitation
a transaction whereby the Registrable Securities are converted into securities
of the successor in interest) or by specific assumption executed by the
transferee.
15. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware applicable to
agreements made in and wholly to be performed in that jurisdiction, except for
matters arising under the Act or the Securities Exchange Act of 1934, which
matters shall be construed and interpreted in accordance with such laws.
16. EXECUTION IN COUNTERPARTS PERMITTED. This Agreement may be
executed in any number of counterparts, each of which shall be enforceable
against the parties actually executing such counterparts, and all of which
together shall constitute one (1) instrument.
17. SPECIFIC PERFORMANCE. The Holder shall be entitled to the
remedy of specific performance in the event of the Company's breach of this
Agreement, the parties agreeing that a remedy at law would be inadequate.
18. INDEMNITY. Each party shall indemnify each other party
against any and all claims, damages (including reasonable attorney's fees), and
expenses arising out of the first party's breach of any of the terms of this
Agreement.
19. ENTIRE AGREEMENT; Written Amendments Required. This
Agreement, including the Exhibits attached hereto, the Subscription Agreements,
the Certificates of Designation, the Preferred Stock certificates, the Escrow
Agreement, and the other documents delivered pursuant hereto constitute the full
and entire understanding and agreement between the parties with regard to the
subjects hereof and thereof, and no party shall be liable or bound to any other
party in any manner by any warranties, representations or covenants except as
specifically set forth herein or therein. Except as expressly provided herein,
neither this Agreement nor any
[INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as
of this ____ day of February, 1998.
VIRAGEN, INC.
By:
--------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice
President/CFO
Address: Viragen, Inc.
▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No. (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇ INVESTMENTS, LLC
By:
--------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇, President
Address: ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇. ▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
INVESTOR(S)
------------------------------------
Investor's Name
By:
---------------------------------
(Signature)
Address:
------------------------------------
------------------------------------
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