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EX. 4.1
WARRANT AGREEMENT
THIS WARRANT AGREEMENT (the "Agreement") is made and entered into as of August ,
2001, by and between HIV-VAC, Inc., a Nevada corporation (the "Company") and
Continental Stock Transfer and Trust Company (together with any successor, the
"Warrant Agent").
WHEREAS, the Company proposes to conduct an offering (the "Offering") of up to
1,000,000 shares of its Convertible Preferred Stock, Series B (the "Shares");
and,
WHEREAS, the Company, as additional consideration for subscribing for the
Shares, proposes to issue to the purchasers in the Offering 5,000,000 warrants
(the "Warrants") to purchase one share of the Company's common stock, par value
$0.001 per share (the "Common Shares"); and
WHEREAS, the Company proposes to issue to the purchasers in the Offering
certificates representing the Warrants (collectively, the "Warrant
Certificates"); and,
WHEREAS, the Company desires to appoint the Warrant Agent, and the Warrant Agent
agrees, to act on behalf of the Company in connection with the issuance,
transfer, exchange, replacement and surrender of the Warrant Certificates; and,
WHEREAS, the Company and the Warrant Agent desire to set forth in this
Agreement, among other things, the form and provisions of the Warrant
Certificates and the terms and conditions under which they may be issued,
transferred, exchanged, replaced and surrendered in connection with exercise of
the Warrants;
NOW THEREFORE, in consideration of the premises and of the mutual agreements
herein contained, the parties hereto agree as follows:
ARTICLE I
DISTRIBUTION OF WARRANT CERTIFICATES
1.1 Appointment of Warrant Agent. The Company hereby appoints the Warrant
Agent to act on behalf of the Company in accordance with the instructions
hereinafter in this Agreement set forth, and the Warrant Agent hereby accepts
such appointment.
1.2 Form of Warrant Certificates. The Warrant Certificates for the Warrants
shall be issued in registered form only and, together with the purchase and
assignment forms to be printed on the reverse thereof, shall be substantially in
the form of EXHIBIT A, and in addition, may have such letters, numbers or other
marks of identification or designation and such legends, summaries or
endorsements stamped, printed, lithographed or engraved thereon as the Company
may deem appropriate and as are not inconsistent with the provisions of this
Agreement or as, in any particular case, may be required, in
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the opinion of the Company, to comply with any law or with any rule or
regulation of any regulatory authority or agency, or to conform to customary
usage.
1.3 Execution of Warrant Certificates. The Warrant Certificates shall be
executed on behalf of the Company by its Chairman or Vice Chairman of the Board,
or President or any Vice President, and by its Chief Financial Officer or any
Assistant Treasurer or Secretary or any Assistant Secretary, either manually or
by facsimile signature printed thereon. The Warrant Certificates shall be
manually countersigned and dated the date of countersignature by the Warrant
Agent and shall not be valid for any purpose unless so countersigned and dated.
In the case any authorized officer of the Company who shall have signed any of
the Warrant Certificates shall cease to be such officer of the Company either
before or after delivery thereof by the Company to the Warrant Agent, the
signature of such person on such Warrant Certificates, nevertheless, shall be
valid and such Warrant Certificates may be countersigned by the Warrant Agent
and issued and delivered to those persons entitled to receive the Warrants
represented by thereby with the same force and effect as though the person who
signed such Warrant Certificates had not ceased to be such officer of the
Company.
1.4 Issuance and Distribution of Warrant Certificates. Upon completion of the
Offering, the Company shall deliver to the Warrant Agent an adequate supply of
Warrant Certificates for the Warrants executed on behalf of the Company as
described in Section 1.3 hereof. Upon receipt of an order from the Company, the
Warrant Agent shall within three (3) business days complete and countersign the
Warrant Certificates representing the total number of Warrants to be issued as
part of the Units, and shall deliver such Warrant Certificates pursuant to
written instructions of the Company.
ARTICLE II
WARRANT EXERCISE PRICE AND EXERCISE OF WARRANTS
2.1 Exercise Price. Each Warrant Certificate for Warrants shall, when signed
and countersigned as set forth in Section 1.3 of this Agreement, entitle the
registered holder thereof to purchase from the Company one Common Share for each
Warrant represented thereby at an exercise price (the "Exercise Price") equal to
the average of the Market Price (as defined in Section 3.2 below) of the Common
Shares for the ten (10) trading days commencing on the first trading day
immediately following the effective date of a registration statement filed by
the Company under the Securities Act of 1933, as amended, with respect to the
Common Shares issuable upon exercise of the Warrants (a "Registration
Statement"), but in any case not less than $1.50 (the "Minimum Exercise Price").
The number of Common Shares issuable upon exercise of a Warrant and the Exercise
Price may be adjusted from time to time pursuant to the provisions of Article
III of this Agreement.
2.2 Exercisability of Warrants. Each Warrant may be exercised at any time
after issuance, but not after 5:00 pm, central time on August ___, 2003, unless
extended for an additional year at the Company's option by written notice given
to the Warrant Agent on or before August ___, 2003 (the "Exercise Deadline").
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2.3 Procedure for Exercise of Warrants. At anytime after the date of issuance
and before the Exercise Deadline, Warrants may be exercised by surrendering the
Warrant Certificates representing such Warrants to the Warrant Agent at its
offices as specified in Section 7.15 of this Agreement (the "Principal Office")
with the election to purchase form set forth on the Warrant Certificate duly
completed and executed, with signature guaranteed by an eligible guarantor
institution that is a participant in a signature guarantee program acceptable to
the Warrant Agent ("Signature Guaranteed"), accompanied by payment in full of
such taxes as are specified in Section 7.1 hereof and the Exercise Price in
effect at the time of such exercise, for each Common Share with respect to which
such Warrants are being exercised. The Exercise Price and taxes shall be paid in
full by certified check or money order payable in United States currency to the
order of the Company. The date on which the Warrants are exercised is sometimes
referred to herein as the "Exercise Date."
2.4 Issuance of Common Shares. As soon as practicable after the Exercise Date,
the Warrant Agent shall provide the Company and the Escrow Agent under that
certain Escrow Agreement (the "Escrow Agreement") of even date herewith between
the Company and Continental Stock Transfer and Trust Company, as escrow agent
(the "Escrow Agent"), with written notice of such exercise. Upon receipt of such
notice, the Company shall cause the Escrow Agent to transfer to the exercising
Warrant holder, in certificated or uncertificated form, that number of Common
Shares to which such holder is entitled in accordance with the instructions set
forth in the election to purchase. All Common Shares issued on exercise of any
Warrants shall be validly authorized and issued, fully paid and nonassessable,
and free from all taxes, liens and charges created by the Company in respect of
the issue thereof, and shall be previously unissued shares. Each person entitled
to Common Shares pursuant to instructions set forth in the election to purchase
shall for all purposes be deemed to have become the beneficial owner on the
Exercise Date of the Common Shares to be issued upon exercise of the Warrants
covered by election to purchase, irrespective of the date of issuance or
delivery of the Common Shares. Promptly after a Registration Statement has been
declared effective by the Securities and Exchange Commission (the "SEC"), the
Company shall cause notice thereof or a copy of the prospectus covering the
Common Shares to be mailed to the Warrant Agent and each registered holder of
Warrants.
2.5 Certificate of Unexercised Warrants. In the event that less than all of
the Warrants represented by a Warrant Certificate are exercised, the Warrant
Agent shall countersign and mail, by first class mail, within 30 days of the
Exercise Date, to the registered holder of such Certificate, or such other
person as shall be designated in the election to purchase, a new Warrant
Certificate representing the number of full Warrants not exercised. In no event
shall a fraction of a Warrant be exercised, and the Warrant Agent shall
distribute no Warrant Certificates representing fractions of Warrants under this
or any other section of this Agreement. Final fractions of Common Shares shall
be treated as provided in Section 3.14.
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2.6 Disposition of Proceeds. The Warrant Agent shall account at least
quarterly (or more frequently at the request of the Company; provided that in no
event shall the Warrant Agent be required to account more frequently than
monthly) to the Company with respect to Warrants exercised and concurrently
deliver to the Company all funds.
ARTICLE III
ADJUSTMENTS AND NOTICE PROVISIONS
3.1 Adjustment of Exercise Price. Subject to the provisions of this Article
III, the Exercise Price in effect from time to time shall be subject to
adjustment, as follows:
(a) In case the Company shall at any time after the date the Warrants were
first issued (1) declare a dividend on its outstanding common stock payable in
shares of its capital stock, (2) subdivide its outstanding common stock, (3)
combine its outstanding common stock into a smaller number of shares, or (4)
issue any shares of its capital stock by reclassification of its common stock
(including any such reclassification in connection with a consolidation or
merger in which the Company is the surviving entity), then, in each case, the
Minimum Exercise Price, and the number of Common Shares issuable upon exercise
of the Warrants, in effect at the time of the record date for such dividend or
of the effective date of such subdivision, combination or reclassification,
shall be proportionately adjusted so that the registered holders after such time
shall be entitled to receive the aggregate number and kind of shares which, if
the Warrants had been exercised immediately prior to such time, he would have
owned upon such exercise and been entitled to receive by virtue of such
dividend, subdivision, combination or reclassification. Such adjustment shall be
made successively whenever any event listed above shall occur.
(b) In case the Company shall issue or fix a record date for the issuance to
all holders of its common stock of rights, options, or warrant to subscribe for
or purchase the Company's common stock (or securities convertible into or
exchangeable for the Company's common stock) at a price per share (or having a
conversion or exchange price per share, if a security convertible into or
exchangeable for the Company's common stock) less than the Market Price of the
common stock on such record date, then, in each case, the Minimum Exercise Price
shall be adjusted by multiplying the Minimum Exercise Price in effect
immediately prior to such record date by a fraction, the numerator of which
shall be the number of shares of common stock outstanding on such record date
plus the number of shares of common stock which the aggregate offering price of
the total number of shares of common stock so to be offered (or the aggregate
initial conversion or exchange price of the convertible or exchangeable
securities so to be offered) would purchase at such Market Price and the
denominator of which shall be the number of shares of common stock outstanding
on such record date plus the number of additional shares of common stock to be
offered for subscription or purchase (or into which the convertible or
exchangeable securities so to be offered are initially convertible or
exchangeable); provided, however, that no such adjustment shall be made which
results in an increase in the Minimum Exercise Price. Such adjustment shall
become effective at the close of business on such record date; provided,
however, that, to the
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extent the shares of common stock (or securities convertible into or
exchangeable for shares of common stock) are not delivered, the Minimum Exercise
Price shall be readjusted after the expiration of such rights, options, or
warrants (but only with respect to Warrants exercised after such expiration), to
the Minimum Exercise Price which would then be in effect had the adjustments
made upon the issuance of such rights, options, or warrants been made upon the
basis of delivery of only the number of shares of common stock (or securities
convertible into or exchangeable for shares of common stock) actually issued. In
case any subscription price may be paid in a consideration, part or all of which
shall be in a form other than cash, the value of such consideration shall be as
determined in good faith by the board of directors of the Company, whose
determination shall be conclusive absent manifest error. Shares of common stock
owned by or held for the account of the Company or any majority-owned subsidiary
shall not be deemed outstanding for the purpose of any such computation.
(c) In case the Company shall distribute to all holders of its common stock
(including any such distribution made to the stockholders of the Company in
connection with a consolidation or merger in which the Company is the surviving
corporation) evidences of its indebtedness, cash or assets (other than
distributions and dividends payable in shares of common stock), or rights,
options, or warrants to subscribe for or purchase common stock, or securities
convertible into or changeable for shares of common stock (excluding those with
respect to the issuance of which an adjustment of the Minimum Exercise Price is
provided pursuant to Section 3.1(d) hereof), then, in each case, the Minimum
Exercise Price shall be adjusted by multiplying the Minimum Exercise Price, in
effect immediately prior to the record date for the determination of
stockholders entitled to receive such distribution by a fraction, the numerator
of which shall be the Market Price of the common stock on such record date, less
the fair market value (as determined in good faith by the board of directors of
the Company, whose determination shall be conclusive absent manifest error) of
the portion of the evidences of indebtedness or assets so to be distributed, or
of such rights, options, or warrants or convertible or exchangeable securities,
or the amount of such cash, applicable to one share, and the denominator of
which shall be such Market Price of the common stock. Such adjustment shall
become effective at the close of business on such record date.
(d) In any case in which this Article III shall require that an adjustment in
the Exercise Price be made effective as of a record date for a specified event,
the Company may elect to defer, until the occurrence of such event, issuing to
the holders of the Warrants, if any holder has exercised a Warrant after such
record date, the Common Shares, if any, issuable upon such exercise over and
above the Common Shares issuable upon such exercise on the basis of the Exercise
Price in effect prior to such adjustment; provided, however, that the Company
shall deliver to such exercising holder a due ▇▇▇▇ or other appropriate
instrument evidencing such holder's right to receive such additional shares upon
the occurrence of the event requiring such adjustment.
(e) Upon each adjustment of the Minimum Exercise Price as a result of the
calculations made in Sections 3.1(a) or 3.1(b) hereof, the holders of Warrants
shall thereafter be entitled to purchase, at the adjusted Exercise Price, that
number of shares
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(calculated to the nearest thousandth) obtained by dividing (i) the product
obtained by multiplying the number of shares purchasable upon exercise of the
Warrant prior to adjustment of the number of shares by the Exercise Price in
effect prior to adjustment of the Exercise Price by (ii) the Exercise Price in
effect after such adjustment of the Exercise Price.
3.2 Definition of Market Price. As used in this Agreement, the term "Market
Price" shall mean:
(i) if the Common Shares are listed, or admitted to unlisted trading
privileges on a national securities exchange, or is traded on the Nasdaq
National Market or the Nasdaq Small-Cap Market, the last reported high bid price
on the each trading day of any measurement period to which such Market Price
relates, in each case as officially reported by the principal securities
exchange on which the Common Shares are listed or admitted to unlisted trading
privileges or by the Nasdaq National Market or Nasdaq Small-Cap Market, or
(ii) if the Common Shares are not listed or admitted to unlisted trading
privileges, on any national securities exchange, or traded on the Nasdaq
National Market or Nasdaq Small-Cap Market, but is traded on the OTC Bulletin
Board of the Nasdaq Stock Market, Inc. (the "OTCBB"), then the Market Price is
the last reported high bid price of the Common Shares reported by the OTCBB; or
(iii) if the Common Shares are not listed or admitted to unlisted trading
privileges, on any national securities exchange, or traded on the Nasdaq
National Market, Nasdaq Small-Cap Market, or the OTCBB but is traded in the
over-the-counter market, then the Market Price is the last reported high bid
price of the Common Shares reported by the National Quotation Bureau, Inc. or
similar bureau if the National Quotation Bureau, Inc. is no longer reporting
such information on the date of the event to which such Market Price relates,
and if no such prices are reported on such date, then the average of the last so
reported high bid prices on the last five trading days on which such prices are
reported immediately preceding such date; or
(iv) if the Common Shares are neither listed, nor admitted to unlisted trading
privileges on a national securities exchange, nor traded on the Nasdaq National
Market or Nasdaq Small-Cap Market, nor on the OTCBB, nor traded in the
over-the-counter market, then the fair market value of the Common Shares, not
less that the book value thereof, as of the date of the event to which such
Market Price relates, as determined in good faith (using customary valuation
methods) by the Board of Directors of the Company, which determination shall be
evidenced by a resolution of the Board of Directors and based on the best
information available to it.
3.3 Merger and Consolidation. In case of any consolidation with or merger of
the Company with or into another corporation (other than a merger or
consolidation in which the Company is the surviving or continuing corporation),
or in case of any sale, lease, or conveyance to another corporation of the
property and assets of any nature of the
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Company as an entirety or substantially as an entirety, such successor, leasing,
or purchasing corporation, as the case may be, the Company shall (a) execute
with the Warrant Agent an agreement providing that the holders of the Warrants
shall have the right thereafter to receive upon exercise of the Warrants solely
the kind and amount of shares of stock and other securities, property, cash, or
any combination thereof receivable upon such consolidation, merger, sale, lease,
or conveyance by a holder of the number of shares of the Company's common stock
for which the Warrants might have been exercised immediately prior to such
consolidation, merger, sale, lease, or conveyance, and (b) make effective
provision in its certificate of incorporation or otherwise, if necessary, to
effect such agreement. Such agreement shall provide for adjustments that shall
be as nearly equivalent as practicable to the adjustments in Section 3.1.
3.4 Reclassification. In case of any reclassification or change of the Common
Shares issuable upon exercise of the Warrants (other than a change in par value
or from no par value to a specified par value, or as a result of a subdivision
or combination, but including any change in the shares into two or more classes
or series or shares), or in case of any consolidation or merger of another
corporation into the Company in which the Company is the continuing corporation
and in which there is a reclassification or change (including a change to the
right to receive cash or other property) of the Common Shares (other than a
change in par value, or from no par value to a specified par value, or as a
result of a subdivision or combination, but including any change in the shares
into two or more classes or series of shares), the holders of Warrants shall
have the right thereafter to receive upon exercise of the Warrants solely the
kind and amount of shares of stock and other securities, property, cash, or any
combination thereof receivable upon such reclassification, change,
consolidation, or merger by a holder of the number of shares of the Company's
common stock for which the Warrants might have been exercised immediately prior
to such reclassification, change, consolidation, or merger. Thereafter,
appropriate provision shall be made for adjustments that shall be as nearly
equivalent as practicable to the adjustments in Section 3.1.
3.5 Verification of Computations. Whenever the Minimum Exercise Price is
adjusted as provide in this Article III, the Company shall promptly obtain a
certificate of a firm of independent public accountants of recognized standing
selected by the board of directors (who may be the regular auditors of the
Company) setting forth the Minimum Exercise Price, so adjusted, and a brief
statement of the facts accounting for such adjustment, an shall make available a
brief summary thereof to the Warrant Agent and to the holders of the Warrants,
at their addresses listed on the register maintained for the purpose by the
Warrant Agent.
3.6 Notice of Actions. In the event that the Company shall propose to take any
action that could cause an adjustment in the Minimum Exercise Price, the Company
shall cause notice of such proposal to be given to the Warrant Agent. Such
notice shall specify the date on which the action is expected to take place. The
Company shall cause copies of such notice to be mailed to each registered holder
of Warrants at least 20 calendar days prior to the date of expected action.
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3.7 Amendment to Warrant Certificates. Irrespective of any adjustments
pursuant to this Article III, Warrant Certificates theretofore or thereafter
issued need not be amended or replaced, but certificates thereafter issued shall
bear a legend or other notice of any adjustments.
3.8 Fractional Shares. The Company shall not be required upon the exercise of
any Warrant to issue fractional shares of its common stock that may result from
adjustments in accordance with this Article III to the Maximum Exercise Price
and the Minimum Exercise Price or the number of Common Shares purchaseable under
each Warrant. If more than one Warrant is exercised at one time by the same
registered holder, the number of full Common Shares that shall be deliverable
shall be computed based on the number of Common Shares deliverable in exchange
for the aggregate number of Warrants exercised. With respect to any final
fraction of a share called for upon the exercise of any Warrant or Warrants, the
Company shall pay a cash adjustment in respect of such final fraction in an
amount equal to the same fraction of the Market Price of a Common Share
calculated in accordance with Section 3.2.
ARTICLE IV
REPURCHASE OF WARRANTS BY THE COMPANY
At any time after not less than 30 calendar days written notice to the Warrant
Agent and each registered holder of Warrants, the Company may repurchase all,
but not less than all of the then outstanding Warrants at a price of $0.10 per
Common Share issuable upon exercise of such Warrants, provided that on the date
notice is given (i) the Common Stock issuable upon exercise of the Warrants
shall be subject to an effective registration statement under the Securities
Act, and (ii) the Market Price of the Common Shares for the 20 preceding
consecutive trading days shall have been at least two times the Exercise Price
of the Warrants to be repurchased. During the notice period provided above, the
holder of Warrants may give notice of exercise of the Warrants called for
repurchase, in which event the Company's right to repurchase the Warrants shall
be suspended for the period provided for closing of the purchase of Common
Shares issuable upon exercise of the Warrants.
ARTICLE V
OTHER PROVISIONS RELATING TO
RIGHTS OF REGISTERED HOLDERS
OF WARRANT CERTIFICATES
5.1 Rights of Warrant Holders. No Warrant Certificate shall entitle the
registered holder thereof to any rights of a shareholder of the Company,
including without limitation, the right to vote, to receive dividends and other
distributions, to receive any notice of, or to attend, meetings of shareholders
or any other proceedings of the Company.
5.2 Lost, Stolen, Mutilated or Destroyed Warrant Certificates. If any Warrant
Certificate shall be lost, mutilated, stolen or destroyed, the Company in its
discretion may
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direct the Warrant Agent to execute and deliver, in exchange and substitution
for and upon cancellation of a mutilated Warrant Certificate, or in lieu of or
in substitution for a lost, stolen or destroyed Warrant Certificate, a new
Warrant Certificate for the number of Warrants represented by the Warrant
Certificate so lost, mutilated, stolen or destroyed but only upon receipt of
evidence of such loss, theft or destruction of such Warrant Certificate, and of
the ownership thereof, and indemnity, if requested, all satisfactory to the
Company and the Warrant Agent. Applicants for such substitute Warrant
Certificates shall also comply with such other reasonable regulations and pay
such other reasonable charges incidental thereto as the Company or the Warrant
Agent may prescribe. Any such new Warrant Certificate shall constitute and
original contractual obligation of the Company, whether or not the allegedly
lost, stolen, mutilated or destroyed Warrant Certificate shall be at anytime
enforceable by anyone.
ARTICLE VI
SPLIT UP, COMBINATION, EXCHANGE, TRANSFER
AND CANCELLATION OF WARRANT CERTIFICATES
6.1 Split Up, Combination, Exchange and Transfer of Warrant Certificates.
(a) Prior to the Exercise Deadline, Warrant Certificates, subject to the
provisions of Section 6.2 and compliance with applicable law, may be split up,
combined or exchanged for other Warrant Certificates representing a like
aggregate number of Warrants or may be transferred in whole or in part. Any
holder desiring to split up, combine or exchange a Warrant Certificate or
Warrant Certificates shall make such request in writing delivered to the Warrant
Agent at its Principal Office and shall surrender the Warrant Certificate or
Warrant Certificates so to be split up, combined or exchanged at said office.
(b) Without the written consent of the Company (which shall not be
unreasonably withheld), Warrants may not be sold, transferred or otherwise
disposed of by the registered holder thereof, except to officers, directors,
partners, members, employees or affiliates of such registered holder. Subject to
the foregoing restriction, any applicable laws, rules or regulations restricting
transferability, any restriction that may appear on a Warrant Certificate in
accordance with the terms hereof, or any "stop-transfer" instructions the
Company may give to the Warrant Agent to implement any such restrictions (which
instructions the Company is expressly authorized to give), transfer of
outstanding Warrant Certificates may be effected by the Warrant Agent from time
to time upon the books of the Company to be maintained by the Warrant Agent for
that purpose, upon surrender of the Warrant Certificate to the Warrant Agent at
its Principal Office, with the assignment form set forth in the Warrant
Certificate duly executed with Signatures Guaranteed.
(c) Upon any such surrender for split up, combination, exchange or transfer,
the Warrant Agent shall execute and deliver to the person entitled thereto a
Warrant Certificate or Warrant Certificates, as the case may be, as so
requested. The Warrant Agent may require the holder to pay a sum sufficient to
cover any tax or governmental
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charge that may be imposed in connection with any split up, combination,
exchange or transfer of Warrant Certificate prior to the issuance of any new
Warrant Certificate.
6.2 Cancellation of Warrant Certificates. Any Warrant Certificate surrendered
upon the exercise of Warrants or for split up, combination, exchange or
transfer, or purchased or otherwise acquired by the Company, shall be cancelled
and shall not be reissued by the Company; and, except in the case of the
exercise of less than all of the Warrants evidenced by a Warrant Certificate or
as provided in Section 6.1 in the case of a split up, combination, exchange or
transfer, no Warrant Certificate shall be issued hereunder in lieu of such
cancelled Warrant Certificate. Any Warrant Certificate so cancelled shall be
destroyed by the Warrant Agent, unless otherwise directed by the Company.
6.3 Agreement of Warrant Holders. Every holder of a Warrant Certificate by
accepting the same consents and agrees with the Company and the Warrant Agent
and with every other holder of a Warrant that: (a) transfer of the Warrant
Certificates shall be registered on the books of the Company maintained for that
purpose by the Warrant Agent only if surrendered at the Principal Office of the
Warrant Agent, duly endorsed or accompanied by a proper instrument of transfer,
with Signatures Guaranteed; and, (b) prior to due presentment for registration
of transfer, the Company and the Warrant Agent may be deem and treat the person
in whose name the Warrant Certificate is registered as the absolute owner
thereof and of the Warrants evidenced thereby (notwithstanding any notations of
ownership or writing on the Warrant Certificates made by anyone other than the
Company or the Warrant Agent) for all purposes whatsoever, and neither the
Company nor the Warrant Agent shall be affected by any notice to the contrary.
ARTICLE VII
PROVISIONS CONCERNING THE WARRANT AGENT
AND OTHER MATTERS
7.1 Payment of Taxes and Charges. The Company will from time to time promptly
pay to the Warrant Agent, or make provisions satisfactory to the Warrant Agent
for the payment of, all transfer taxes and charges that may be imposed by the
United States or any state upon the Company or the Warrant Agent in connection
with the issuance or delivery of Common Shares upon the exercise of any
Warrants, but any such taxes in connection with the issuance of Warrant
Certificates or certificates for Common Shares in any name other than that of
the registered holder of the Warrant Certificate surrendered shall be paid by
such registered holder; and, in such case, the Company shall not be required to
issue or deliver any Warrant Certificate or Common Share certificate until such
taxes shall have been paid or it has been established to the Company's
satisfaction that no tax is due.
7.2 Resignation or Removal of Warrant Agent. The Warrant Agent may resign his
duties and be discharged from all further duties and liabilities hereunder after
giving 30 days' notice in writing to the Company, except that such shorter
notice may be given as the Company shall, in writing, accept as sufficient. Upon
comparable notice to the Warrant Agent, the Company may remove the Warrant
Agent; provide, however, that in
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such case the Company shall appoint a new Warrant Agent, as hereinafter
provided, and the removal of the Warrant Agent shall not be effective until a
new Warrant Agent has been appointed and has accepted such appointment. If the
Company shall fail to make such appointment within a period of 30 days after it
has been notified in writing of such resignation or incapacity by the resigning
or incapacitated Warrant Agent or by the registered holder of any Warrant, then
the registered holder of any Warrant may apply to any court of competent
jurisdiction for the appointment of a new Warrant Agent. The Warrant Agent
hereby agrees to take any such action as may be necessary to provide for the
orderly transfer of its responsibilities hereunder to the new Warrant Agent. Any
new Warrant Agent appointed hereunder shall execute, acknowledge and deliver to
the former Warrant Agent last in office, and to the Company, an instrument
accepting such appointment under substantially the same terms and conditions as
are contained herein, and thereupon such new Warrant Agent without any further
act or deed shall become vested with the rights, powers, duties and
responsibilities of the Warrant Agent and the former Warrant Agent shall cease
to be the Warrant Agent; but for any reason if it becomes necessary or expedient
to have the former Warrant Agent execute and deliver any further assurance,
conveyance, act or deed, the same shall be done at the expense of the Company
and shall be legally and validly executed and delivered by the former Warrant
Agent. Notwithstanding anything to the contrary, the former Warrant Agent shall
pay any expenses resulting from such former Warrant Agent's removal due to his
breach of this Agreement.
7.3 Notice of Appointment. Not later than the effective date of the
appointment of a new Warrant Agent, the Company shall cause notice thereof to be
mailed to the former Warrant Agent and the transfer agent for the Common Shares,
and shall forthwith cause a copy of such notice to be mailed to each registered
holder of a Warrant. Failure to mail such notice, or any defect contained
therein, shall not affect the legality or validity of the appointment of any
successor Warrant Agent.
7.4 Merger of Warrant Agent. If the Warrant Agent is not a natural person and
is merged with or into another, or is consolidated with another, then any
company resulting from any merger or consolidation to which the Warrant Agent
shall be a party, shall be the successor Warrant Agent under this Agreement
without further act, provided that such company would be eligible for
appointment as a successor Warrant Agent under the provisions of Section 7.2
hereof. Any such successor Warrant Agent may adopt the prior countersignature of
any predecessor Warrant Agent and distribute Warrant Certificates countersigned
but not distributed by such predecessor Warrant Agent, or may countersign the
Warrant Certificates in its own name.
7.5 Company Responsibilities.
(a) The Company Agrees that it shall pay to the Warrant Agent The sum of $
per year (the "Agency Fee") In cash as reasonable remuneration for his services
as Warrant Agent hereunder and will reimburse the Warrant Agent upon demand for
all expenses, advances and expenditures that the Warrant Agent may reasonably
incur in the execution of its duties hereunder (including fees and disbursements
of legal counsel). Concurrently
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with the execution of this Agreement, the Company shall pay to the Warrant Agent
the Agency Fee for the period beginning on the date hereof and ending on
December 31, 2001. Thereafter, the Agency Fee shall be payable in advance on or
before the first day of January of each calendar year or portion thereof during
the term of this Agreement.
(b) provide the Warrant Agent, upon request, with sufficient funds to pay any
cash due pursuant to Section 3.8 upon exercise of Warrants,
(c) prepare, file and cause to become effective within 120 days after the
first issuance of Warrants a registration statement under the Securities Act
with respect to the Common Shares issuable upon exercise of the Warrants,
(d) prepare and file with the SEC such amendments and supplements to such
registration statement and the prospectus used in connection therewith as may be
necessary to keep such registration statement effective for a period of not less
than six months (subject to extension as provided below) or such longer period
as in the opinion of counsel for the Warrant Agent a prospectus is required by
law to be delivered in connection with sales of the Common Shares issuable on
exercise of the Warrants,
(e) furnish to each holder of Warrants and to the Warrant Agent such number of
copies of such registration statement, each amendment and supplement thereto,
the prospectus included in such registration statement (including each
preliminary prospectus) and such other documents as such persons may reasonably
request in order to facilitate the disposition of the Common Shares issuable
upon exercise of the Warrants,
(f) register or qualify the Common Shares issuable on exercise of the Warrants
under such other securities or blue sky laws of such jurisdictions as any holder
of Warrants reasonably requests and do any and all other acts and things which
may be reasonably necessary or advisable to enable such holders to consummate
the disposition the Common Shares issuable on exercise of the Warrants, and
(g) perform, execute, acknowledge and deliver or cause to be performed,
executed, acknowledged and delivered all further and other acts, instruments and
assurances as may reasonably be required by the Warrant Agent for the carrying
out or performing by the Warrant Agent of the provisions of this Agreement.
7.6 Certificate for the Benefit of Warrant Agent. Whenever in the performance
of his duties under this Agreement the Warrant Agent shall deem it necessary or
desirable that any matter be proved or established or that any instructions with
respect to the performance of his duties hereunder be given by the Company prior
to taking or suffering any action hereunder, such matter (unless other evidence
in respect thereof be herein specifically prescribed) may be deemed conclusively
proved and established, or such instructions may be given, by a certificate or
instrument signed by the Chairman, the President, a Vice President, the
Secretary or the Treasurer of the Company and delivered to the Warrant Agent.
Such certificate or instrument may be relied upon by the Warrant Agent for any
action taken or suffered in good faith by him under the provisions of this
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Agreement; but in its discretion the Warrant Agent may in lieu thereof accept
other evidence of such matter or may require such further or additional evidence
as he may deem reasonable.
7.7 Books and Records. The Warrant Agent shall maintain the Company's books
and records for registration and registration of transfer of the Warrants issued
hereunder. Such books shall show the names and addresses of the respective
holders of the Warrants, the number of Warrants evidenced on its face by each
Warrant Certificate and the date of each Warrant Certificate.
7.8 Liability of the Warrant Agent. The Warrant Agent shall be liable
hereunder for his own gross negligence or willful misconduct. The Warrant Agent
shall act hereunder solely by the provisions hereof. The Warrant Agent shall not
be liable for or by reason of any of the statements of fact or recitals
contained in this Agreement or in the Warrant Certificates (except its
countersignature thereof) or be required to verify the same, but all such
statements and recitals are and shall be deemed to have been made by the Company
only. The Warrant Agent will not incur any liability or responsibility to the
Company or to any holder of any Warrants for any action taken, or any failure to
take action, in reliance on any notice, resolution, waiver, consent, order,
certificate, or other paper, document or instrument reasonable believed by the
Warrant Agent to be genuine and to have been signed, sent or presented by the
proper party or parties. The Warrant Agent shall not be under any responsibility
in respect of the validity of this Agreement or the execution and delivery
hereof by the Company or in respect of the validity or execution of any Warrant
Certificate (except its countersignature thereof); nor shall he be responsible
for any breach by the Company of any covenant or condition contained in this
Agreement or in any Warrant Certificate; nor shall he be responsible for the
making of any adjustment required under the provisions of Article III hereof or
responsible for the manner, method or amount of any such adjustment or the facts
that would require any such adjustment; nor shall he by any act hereunder be
deemed to make any representation or warranty as to the authorization or
reservation of any Common Shares or other securities to be issued pursuant to
this Agreement or any Warrant Certificate or as to whether any Common Shares or
other securities will when issued be validly authorized and issued and fully
paid and nonassessable.
7.9 Use of Attorneys, Agents and Employees. The Warrant Agent may execute and
exercise any of the rights or powers hereby vested in he or perform any duty
hereunder either himself or by or through his attorneys, agents or employees.
7.10 Indemnification. The Company agrees to indemnify the Warrant Agent and
save him harmless against any and all losses, expenses or liabilities, including
judgments, costs and counsel fees arising out of or in connection with his
agency under this Agreement, except as a result of the gross negligence or
willful misconduct of the Warrant Agent.
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7.11 Acceptance of the Agency. The Warrant Agent hereby accepts the agency
established by this Agreement and agrees to perform the same upon the terms and
conditions herein set forth.
7.12 Changes to Agreement. Neither the Company nor the Warrant Agent may, by
supplemental agreement or otherwise, materially alter or change the rights,
privileges or immunities of the registered holders of the Warrants, without the
prior written consent of the holders of a majority of the Warrants.
7.13 Assignment. All the covenants and provisions of this Agreement by or for
the benefit of the Company or the Warrant Agent shall bind and inure to the
benefit of their respective successors and assigns.
7.14 Successor to Company. The Company will not merge or consolidate with or
into any other corporation or sell or otherwise transfer its property, assets
and business substantially as an entirety to a successor corporation, unless the
corporation resulting from such merger, consolidation, sale or transfer (if not
the Company) shall expressly assume, by supplemental agreement reasonably
satisfactory in form and substance to the Warrant Agent, the due and punctual
performance and observance and each and every covenant condition of this
Agreement to be performed and observed by the Company.
7.15 Notices. Any notice or demand required by this Agreement to be given or
made by the Warrant Agent or by the registered holder of any Warrant to or on
the Company shall be sufficiently given or made if sent by certified mail,
postage prepaid, addressed (until another address is filed in writing by the
Company with the Warrant Agent), as follows:
HIV-VAC, Inc.
▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Any notice or demand required by this Agreement to be given or made by the
registered holder of any Warrants or by the Company to or on the Warrant Agent
shall be sufficiently given or made if sent by certified mail, postage prepaid,
addressed (until another address is filed in writing by the Warrant Agent with
the Company), as follows:
Continental Stock Transfer & Trust Company
▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Any notice or demand required by this Agreement to be given or made by the
Company or the Warrant Agent to or on any registered holder of Warrants shall be
sufficiently given or made, whether or not such registered holder receives the
notice, if sent by first class mail, postage prepaid, addressed to such
registered holder at his last address as
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shown on the books of the Company maintained by the Warrant Agent. Otherwise
such notice or demand shall be deemed given when received by the party entitled
thereto.
7.16 Defects in Notice. Failure to file any certificate or notice or to mail any
notice, or any defect in any certificate or notice pursuant to this Agreement,
shall not affect in any way the rights of any registered holder of a Warrant or
the legality or validity of any adjustment made pursuant to Section 3.1 hereof,
or any transaction giving rise to any such adjustment, or the legality or
validity of any action taken or to be taken by the Company.
7.17 Governing Law. The laws of the State of New York shall govern this Warrant
Agreement and the Warrant Certificates.
7.18 Standing. Nothing in this Agreement expressed and nothing that may be
implied from any of the provisions hereof is intended, or shall be construed, to
confer upon, or given to, any person or corporation other than the Company, the
Warrant Agent and the registered holders of the Warrants any right remedy or
claim under or by reason of this Agreement or of any covenant, condition,
stipulations, promises and agreements contained in this Agreement shall be for
the sole and exclusive benefit of the Company and the Warrant Agent and their
respective successors, and registered holders of the Warrants.
7.19 Headings. The descriptive headings of the articles and sections of this
Agreement are inserted for convenience only and shall not control or affect the
meaning or construction of any of the provisions hereof.
7.20 Counterparts. This Agreement may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original; but such
counterparts shall together constitute but one and the same instrument.
7.21 Conflict of Interest. The Warrant Agent and any shareholder, director,
officer or employee of the Warrant Agent may buy, sell or deal in any of the
Warrants or other securities of the Company or become pecuniarily interested in
any transaction in which the Company may be interested, or contract with or lend
money to the Company or otherwise act as fully and freely as though the Warrant
Agent were not Warrant Agent under this Agreement. Nothing in this Agreement
shall preclude the Warrant Agent from acting in any other capacity for the
Company, including without limitation as escrow agent, trustee under any
indenture or as transfer agent for the Units, Common Shares or any other
securities of the Company, or for any other legal entity.
7.22 Availability of the Agreement. The Warrant Agent shall keep copies of this
Agreement available for inspection by holders of Warrants during normal business
hours at his Principal Office. Copies of this Agreement may be obtained, without
charge, upon written request to the Company at the address set forth in Section
7.15.
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7.23 Term of Agreement. The term of this Agreement shall commence on the date
hereof and continue until the earlier of (a) August , 2003, or (b) the date
which is 30 days after the Exercise Date of the last outstanding Warrant. Upon
termination of this Agreement, the Warrant Agent shall be discharged from any
further obligation hereunder and the Company shall be discharged from any
further obligation to compensate the Warrant Agent for services rendered after
such termination date.
In Witness Whereof, this Agreement has been duly executed by the parties hereto
as of the day and year first above written.
HIV-VAC, INC.
By:
--------------------------------------------------
Name:
------------------------------------------------
Title:
-----------------------------------------------
CONTINENTAL STOCK TRANSFER & TRUST COMPANY
By:
-------------------------------------------------
Name:
------------------------------------------------
Title:
-----------------------------------------------
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EXHIBIT A
No.____ _____ Warrants
HIV-VAC, INC.
COMMON STOCK PURCHASE WARRANT
Not exerciseable after 5:00, pm, Central time,
On ___________, 2003,
Unless extended for an additional year at the Company's option
THIS CERTIFIES THAT: ________________________________
Or registered assigns is the registered holder (the "Registered Holder") of the
number of Warrants set forth above, each of which represents the right to
purchase one fully paid and nonassessable share of the common stock, no par
value (the "Common Stock"), of HIV-VAC, Inc. (the "Company") at an initial
exercise price equal to the average of the Market Price (as defined in the
Warrant Agreement referred to below) of the Common Stock for the ten (10)
trading days commencing on the first trading day immediately following the
effective date of a registration statement filed by the Company under the
Securities Act of 1933, as amended, with respect to the Common Stock issuable
upon exercise of the Warrant, but in any case not less than $1.50 (the "Minimum
Exercise Price"), at any time after issuance hereof, but not after 5:00 pm,
central time on August ____, 2003, unless extended for an additional year at the
Company's option by written notice given to the Warrant Agent on or before
August ___, 2003 (the "Exercise Deadline"), by surrendering this Warrant
Certificate, with the Form of Election to purchase on the reverse side hereof
duly executed at the office maintained pursuant to the Warrant Agreement
hereinafter referred to for that purpose to Continental Stock Transfer & Trust
Company, or its successor as warrant agent (the "Warrant Agent") and by paying
in full the Exercise Price, plus transfer taxes, if any. Payment of the Exercise
Price shall be made in United States currency, by certified check or money order
payable to the order of the Company.
No Warrant may be exercised after the Exercise Deadline. All Warrants evidenced
hereby shall thereafter become void.
Without the written consent of the Company (which shall not be unreasonably
withheld), Warrants may not be sold, transferred or otherwise disposed of by the
registered holder thereof, except to officers, directors, partners, members,
employees or affiliates of such registered holder. Subject to the foregoing
restriction, any applicable laws, rules or regulations restricting
transferability and to any restriction on transferability that may appear on
this Warrant Certificate in accordance with the terms of the Warrant Agreement,
dated as of August ____, 2001, between the Company and the Warrant Agent (the
"Warrant Agreement"), the Registered Holder shall be entitled to transfer this
Warrant Certificate in whole or in part upon surrender of this Warrant
Certificate at the office of the Warrant Agent maintained for that purpose with
the form of assignment on the reverse side hereof duly executed, with signatures
guaranteed. Upon such a transfer, a new Warrant Certificate or Warrant
Certificates representing the same aggregate number of Warrants will be issued
in accordance with instructions in the form of assignment.
Upon the exercise of less than all of the Warrants evidenced by this Warrant
Certificate, there shall be issued to the Registered Holder a new Warrant
Certificate in respect of the Warrants not exercised.
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Upon certain events provided for in the Warrant Agreement, the Exercise Price
and the Minimum Exercise Price, and number of shares of Common Stock issuable
upon the exercise of each Warrant are required to be adjusted.
No fractional shares will be issued upon the exercise of Warrants. As to any
final fraction of a share which the Registered Holder of one or more Warrant
Certificates, the rights under which are exercised in the same transaction,
would otherwise be entitled to purchase upon such exercise, the Company shall
pay the cash value thereof determined as provided in the Warrant Agreement.
This Warrant Certificate is issued under and in accordance with the Warrant
Agreement and is subject to the terms and provisions contained in said Warrant
Agreement, to all of which terms and provisions the Registered Holder consents
by acceptance hereof.
This Warrant Certificate shall not entitle the Registered Holder to any of
rights of a shareholder of the Company, including without limitation, the right
to vote, to receive dividends and other distributions, or to attend or receive
any notice of meetings of shareholders or any other proceedings of the Company.
This Warrant Certificate shall not be valid for any purpose until it shall have
been countersigned by the Warrant Agent.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be duly
executed under its corporate seal.
HIV-VAC, INC.
[SEAL]
By:
--------------------------------
ATTEST:
-------------------------------------
Treasurer
Countersigned:
Dated:
---------------------------- -------------------------------------
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FORM OF ELECTION TO PURCHASE
The undersigned hereby irrevocably elects to exercise _________ of the Warrants
represented by this Warrant Certificate and to purchase the shares of Common
Stock issuable upon the exercise of said Warrants, and requests that
certificates for such shares be issued and delivered as follows:
Issue to:
-----------------------------------------------------------------------
(Name)
-----------------------------------------------------------------------
(Address, Including Zip Code)
-----------------------------------------------------------------------
(Social Security or other Tax Identifying Number)
Deliver to:
---------------------------------------------------------------------
(Name)
--------------------------------------------------------------------------------
(Address, Including Zip Code)
If the number of warrants hereby exercised does this Warrant Certificate
represent less than all the Warrants, the undersigned requests that a new
Warrant Certificate representing the number of full Warrants not exercised be
issued and delivered as set forth.
In full payment of the purchase price with respect to the Warrants exercised and
transfer taxes, if any, the undersigned hereby tenders payment of $_____ by
certified check or money order payable in the United States currency to the
order of the Company.
Dated:
--------------------------------
-------------------------------------- --------------------------------
(Insert Social Security Number or (Signature of Registered Holder)
other identifying number of holder)
--------------------------------
(Signature of Registered Holder,
if co-owned)
NOTE: Signature must conform in all respects to the name of holder as specified
on the face of the Warrant Certificate.
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FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto the
Assignee named below all of the rights of the undersigned represented by the
within Warrant Certificate, with respect to the number of Warrants set forth
below:
Name of Assignee Address No. of Warrants
---------------- ------- ---------------
And does hereby irrevocably constitute and appoint _________________ attorney to
make such transfer on the books of HIV-VAC, Inc. maintained for that purpose,
with full power of substitution in the premises.
Dated:
--------------------------------
-------------------------------------- --------------------------------
(Insert Social Security Number or (Signature of Registered Holder)
other identifying number of holder)
--------------------------------
(Signature of Registered Holder,
if co-owned)
NOTE: Signature must conform in all respects to the name of holder as specified
on the face of the Warrant Certificate.
Signature Guaranteed:
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