Exhibit 10.1

AGREEMENT

This Agreement (the “Agreement”), dated December 22, 2008 (the “Effective
Date”), is by and among Generex Biotechnology Corporation (the “Company”), and
the investor listed on the signature page hereto (the “Investor”).

RECITALS

A.           Pursuant to that certain Securities Purchase Agreement (the
“Purchase Agreement”), dated as of March 31, 2008, by and among the Company, the
Investor and the other parties thereto, the Investor purchased the Company’s 8%
Senior Secured Convertible Note in the aggregate principal amount of $5,000,000
(the “Note”). Capitalized terms used in this Agreement that are not otherwise
defined have the meanings set forth in the Note.

B.           Pursuant to the Purchase Agreement, the Investor purchased (i) a
Series A Warrant to acquire additional shares of Common Stock (the “Series A
Warrants”), (ii) a Series A-1 Warrant to acquire additional shares of Common
Stock (the “Series A-1 Warrants”), (iii) a Series B Warrant to acquire
additional shares of Common Stock (the “Series B Warrants”), and (iv) a Series C
Warrant to acquire additional shares of Common Stock (the “Series C Warrants”),
in each case, as set forth on Schedule of Buyers attached to the Purchase
Agreement.  The Series A Warrants, the Series A-1 Warrants, the Series B
Warrants, and the Series C Warrants issued to the Investor are hereinafter
collectively called the “Series Warrants.”

C.           In connection with the transactions contemplated by the Purchase
Agreement, the Company reduced the strike prices of certain then outstanding
warrants held by the Investor (collectively, the “Pre-Extant Warrants”) to $1.10
and extended the expiration dates thereof to March 31, 2015.

D.           The Company, as of the Effective Date, is not in compliance with
the Net Cash Balance Test in the Note and each of the Other Notes, which
constitutes an Event of Default under the Note and each of the Other Notes.

E.           On December 17, 2008, one of the holders of the Other Notes served
on the Company an Event of Default Redemption Notice with respect to an Event of
Default by the Company under Section 4(a)(xv) of its Other Note (the “Redemption
Notice”).

F.           The Note requires the Company to pay the Investor on each
applicable Installment Date the Installment Amount due on such date by electing
(i) a Company Conversion if various conditions are satisfied and/or (ii) a
Company Redemption.

G.           As of the Effective Date, one of the Equity Conditions has not been
satisfied in that the Company received notice from The NASDAQ Stock Market of
the Company’s failure to comply with the minimum bid price requirement of
Marketplace Rule 4310(c)(4) (the “Listing Maintenance Equity Condition”).
 
 
 

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AGREEMENT
 
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Investor
hereby agree as follows:

 
1.
The exercise price of each of the Series Warrants is hereby reduced from $1.21
to $0.50, subject to further adjustment provided therein, effective from and
after the Effective Date.

 
2.
The exercise price of each of the Pre-Extant Warrants is hereby reduced from
$1.10 to $0.50, subject to further adjustment provided therein, effective from
and after the Effective Date.

 
3.
The Investor hereby agrees that the number of shares of Common Stock issuable
upon exercise of the Series Warrants and the Pre-Extant Warrants shall not be
increased solely as a result of the reductions of the exercise prices thereof
contemplated by Section 1 and 2 above. The Investor hereby agrees that the
Conversion Price shall not be reduced solely as a result of the reductions of
the exercise prices of the Series Warrants and the Pre-Extant Warrants
contemplated by Section 1 and 2 above.

 
4.
The Company may, at its option and exercisable in its sole discretion, on one
occasion, upon not less than five (5) Business Days’ prior written notice
delivered to the Investor  (the “Call Notice”), require the Investor to exercise
all and not less than all of the Investor’s then outstanding Series Warrants and
Pre-Extant Warrants if the arithmetic average of the VWAP of the Common Stock on
the Principal Market for a twenty-one (21) consecutive Trading Day period is
equal to or greater than $1.00 (as adjusted for stock splits, combinations and
the like from and after the Effective Date) (the “Trigger Price”) from and after
the Effective Date. To be effective, the Call Notice must be given within two
(2) Business Days after the aforementioned twenty-one (21) consecutive Trading
Day period. The Call Notice shall state the date on which exercise shall be
required (the “Required Exercise Date”), which shall be no less than five (5)
Business Days after the date of such notice (or, if such date is not a Business
Day, on the next succeeding Business Day), provided that a Call Notice shall not
be valid if (i) the Equity Conditions (as defined on Schedule 1 attached hereto,
which is hereby incorporated by reference into, and made a part of, this
Agreement) are not satisfied on each day during the period commencing on the
date of the Call Notice and ending on the Required Exercise Date or (ii) as
otherwise contemplated below, and in either such case any such Call Notice that
is not so valid shall be invalid and of no force or effect.  The rights and
privileges granted pursuant to the Series Warrants and the Pre-Extant Warrants
which are subject to a valid Call Notice shall terminate at 12:00 a.m. on the
first Business Day following the Required Exercise Date if all of the Series
Warrants and the Pre-Extant Warrants are not exercised by the Investor (or the
successor holder thereof) on or prior to 11:59 p.m. (New York time) on the
Required Exercise Date. If the Company elects to issue a Call Notice, then it
must simultaneously take the same action with respect to all other similar
warrants originally issued to holders of the Other Notes. If the Company does
not comply with the immediately preceding sentence, then the Call Notice issued
by the Company to the Investor shall be invalid and of no force or effect. For
clarification purposes, nothing contained in this paragraph shall limit the
right of the Investor to exercise any of the Series Warrants or any of the
Pre-Extant Warrants on a cashless basis.

 
 
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5.
Promptly following the Effective Date, the Company shall issue to the Investor a
warrant (which will expire on the seven year anniversary of the Required
Exercise Date) to acquire up to that number of shares of Common Stock that is
equal to the number of shares of Common Stock acquired by such Investor in
connection with the Investor’s exercise of the Series Warrants and the
Pre-Extant Warrants pursuant to a Call Notice (the “Reload Warrants”). The per
share exercise price of the Reload Warrants shall be $1.00 (as adjusted for
stock splits, combinations and the like from and after the Effective Date). The
Reload Warrants shall contain standard terms and conditions (including, without
limitation, full-ratchet anti-dilution protection) and shall be in the same form
as the form of the Series Warrants.

 
6.
The expiration dates of the Series A Warrants and the Series A-1 Warrants are
hereby extended to March 31, 2016, and such warrants are hereby amended to
reflect the foregoing.

 
7.
The expiration date of the Series C Warrants is hereby extended to September 30,
2016, and such warrants are hereby amended to reflect the foregoing.

 
8.
The expiration dates of each of the Pre-Extant Warrants are hereby extended to
March 31, 2016, and such warrants are hereby amended to reflect the foregoing.

 
9.
The Investor hereby waives (a) the Event of Default under Section 4(a)(xv) of
the Note with respect to the Company’s failure to meet Net Cash Balance Test in
respect of any and all periods prior to the Effective Date, and (b) compliance
by the Company with the first sentence of Section 13(f) of the Note for the
period commencing on the Effective Date and ending on the 30th day of January
2009 (the “Reassessment Date”).

10.
The Company shall honor the Company Installment Notices delivered by the Company
on December 1, 2008 in respect of the January 1, 2009 Installment Date pursuant
to which the Company confirmed its intention to redeem 100% of the January 1,
2009 Installment Amounts pursuant to a Company Redemption, and the Company shall
promptly pay the applicable Company Redemption Amount when due.

11.
In addition to the redemption of the January 1, 2009 Installment Amount, on
January 12, 2009 (the “Additional Installment Date”), the Company will repay to
the Investor an additional portion of the outstanding principal amount of the
Note equal to $333,333.33, which amount shall be converted in whole pursuant to
a Company Conversion (such amount is referred to herein as the “Additional
Conversion Amount” and such additional repayment is referred to herein as the
“Additional Repayment”) in accordance with the remainder of this Section 11. In
connection with the foregoing, (i) notwithstanding the terms of the Note, (a)
the Effective Date shall constitute the Installment Notice Due Date and the
Company Installment Notice Date, in each case, with respect to the Additional
Installment Date, (b) this Agreement shall constitute (I) the Company
Installment Notice with respect to the Additional Installment Date, (II) the
Company’s election of a Company Conversion with respect to the Additional
Conversion Amount and the Additional Installment Date and (III) the Company’s
confirmation of the matters required to be confirmed in Section 8 of the Note in
connection with the Company’s election of a Company Conversion with respect to
the Additional Conversion Amount and the Additional Installment Date and (c) the
Pre-Installment Conversion Shares with respect to the Additional Conversion
Amount and the Additional Installment Date shall be delivered no later than
December 23, 2008 in accordance with Section 8(a) of the Note, (ii)
notwithstanding the Pre-Installment Conversion Price set forth in the Note, the
Pre-Installment Conversion Price with respect to the Additional Repayment and
the Additional Conversion Amount shall be equal to the price which shall be
computed as 90% of the arithmetic average of the VWAP of the Common Stock on
each of the twenty (20) consecutive Trading Days immediately preceding the
Effective Date and (iii) notwithstanding the Company Conversion Price set forth
in the Note, the Company Conversion Price with respect to the Additional
Repayment and the Additional Conversion Amount shall be equal to the price which
shall be computed as 90% of the arithmetic average of the VWAP of the Common
Stock on each of the twelve (12) consecutive Trading Days immediately preceding
the Additional Installment Date. All such determinations to be appropriately
adjusted for any stock split, stock dividend, stock combination or other similar
transaction during such measuring periods. Other than as expressly set forth in
this Agreement, the Company shall deliver Pre-Installment Conversion Shares and
Conversion Shares in accordance with the terms of the Note.

 
 
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12.
The Investor hereby waives satisfaction of only the Listing Maintenance Equity
Condition solely with respect to (a) the Additional Repayment and the Additional
Installment Date, and (b) the Installment Date that is February 1, 2009 (the
“February 1st Installment Date”) such that the Company will be entitled to
deliver a Company Installment Notice in respect of the February 1st Installment
Date confirming that the applicable Installment Amount due in respect of the
February 1st Installment Date will be converted in whole pursuant to a Company
Conversion if (i) all other Equity Conditions and (ii) all other conditions
relating to a Company Conversion, in each case, are satisfied in accordance with
the terms of the Note.

13.
Solely for the purposes of the February 1st Installment Date, (a)
notwithstanding the terms of the Note, the Installment Notice Due Date shall be
January 9, 2009 (provided that the Company Installment Notice with respect to
the February 1st Installment Date shall be delivered on January 9, 2009 after
4:00 p.m. (New York time)), (b) notwithstanding the Pre-Installment Conversion
Price set forth in the Note, the Pre-Installment Conversion Price with respect
to the February 1st Installment Date shall be equal to the price which shall be
computed as 90% of the arithmetic average of the VWAP of the Common Stock on
each of the twelve (12) consecutive Trading Days immediately preceding and
ending on (and including) January 9, 2009 and (c) notwithstanding the Company
Conversion Price set forth in the Note, the Company Conversion Price with
respect to the February 1st Installment Date shall be equal to the price which
shall be computed as 90% of the arithmetic average of the VWAP of the Common
Stock on each of the fourteen (14) consecutive Trading Days immediately
preceding the February 1st Installment Date. All such determinations to be
appropriately adjusted for any stock split, stock dividend, stock combination or
other similar transaction during such measuring periods. Other than as expressly
set forth in this Agreement, the Company shall deliver Pre-Installment
Conversion Shares and Conversion Shares in accordance with the terms of the
Note.

14.
Prior to the opening of the Principal Market on December 23, 2008, the Company
shall file with the SEC a Form 8-K Current Report describing all of the material
terms of the transactions contemplated by this Agreement in the form required by
the 1934 Act and attaching a form of this Agreement.

 
 
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15.
On or before the Reassessment Date, the Company will procure and deliver to the
Investor an authenticated Control Agreement in respect of each Deposit Account
of each Grantor. For the purposes of this paragraph, the terms “Control
Agreement,” “Deposit Account,” and “Grantor” shall have the meanings ascribed
thereto in the Security Agreement. The Company’s breach of the provisions of
this paragraph shall constitute, and be deemed to be, an Event of Default under
Section 4(a)(xiv) of the Note, and the Company agrees that such a breach shall
be deemed a breach which is not curable.  This Agreement shall be deemed to be a
Transaction Document for purposes of the Purchase Agreement, the Note and all
other Transaction Documents.

16.
Except as otherwise expressly provided herein, the Note, the Series Warrants,
the Pre-Extant Warrants and all other Transaction Documents are, and shall
continue to be, in full force and effect and are hereby ratified and confirmed
in all respects. All dollar amounts referred to in this Agreement are in United
States Dollars.

17.
If requested by the Investor, the Company will deliver to the Investor amended
warrant certificates to the address specified by the Investor that reflect the
amendments set forth herein within five (5) days after such request, and such
amended warrant certificates shall replace the Series Warrants and the
Pre-Extant Warrants and the Investor shall not be obligated to return any of
such warrants to the Company. For clarification purposes, it is understood and
agreed that the amendments set forth herein are effective as of the date hereof
regardless of whether such amended warrant certificates are so requested or
delivered.

18.
This Agreement may be executed in two or more identical counterparts, all of
which shall be considered one and the same agreement and shall become effective
when counterparts have been signed by each party and delivered to the other
party. In the event that any signature is delivered by facsimile transmission or
by an e-mail which contains a portable document format (.pdf) file of an
executed signature page, such signature page shall create a valid and binding
obligation of the party executing (or on whose behalf such signature is
executed) with the same force and effect as if such signature page were an
original thereof.

 
 
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19.
The Company represents, warrants and covenants that the Company has not entered
into, and will not enter into, any agreement with any holder of Other Notes or
similar warrants on terms or conditions which are more favorable to any such
holder with respect to the matters addressed by this Agreement. To the extent
the Company enters into any agreement with any holder of Other Notes or similar
warrants that contains any terms or conditions which are more favorable to any
such holder with respect to the matters addressed by this Agreement, then the
Investor, at its option, shall be entitled to the benefit of such more favorable
terms or conditions (as the case may be) and this Agreement shall be
automatically amended to reflect such more favorable terms or conditions (as the
case may be).

20.
The obligations of the Investor hereunder are several and not joint with the
obligations of any other holder of Other Notes or similar warrants, and the
Investor shall not be responsible in any way for the performance of the
obligations of any other holder of Other Notes or similar warrants under any
other similar agreement. Nothing contained herein, and no action taken by the
Investor pursuant hereto, shall be deemed to constitute the Investor and the
holders of the Other Notes or similar warrants as, and the Company acknowledges
that the Investor and the holders of the Other Notes and similar warrants do not
so constitute, a partnership, an association, a joint venture or any other kind
of group or entity, or create a presumption that the Investor or any holder of
Other Notes or similar warrants are in any way acting in concert or as a group
or entity with respect to such obligations or the transactions contemplated by
this Agreement or any matters, and the Company acknowledges that the Investor
and the holders of the Other Notes and similar warrants are not acting in
concert or as a group, and the Company shall not assert any such claim, with
respect to such obligations or the transactions contemplated by this Agreement
or any other similar agreement. The decision of the Investor to enter into this
Agreement has been made by the Investor independently of any holder of Other
Notes or similar warrants. The Company and the Investor confirms that the
Investor has independently participated with the Company in the negotiation of
the transaction contemplated hereby with the advice of its own counsel and
advisors. The Investor shall be entitled to independently protect and enforce
its rights, including, without limitation, the rights arising out of this
Agreement or out of any other Transaction Documents, and it shall not be
necessary for any other holder of Other Notes or similar warrants to be joined
as an additional party in any proceeding for such purpose. To the extent that
any holder of Other Notes or similar warrants enters into an agreement with the
same or similar terms and conditions or pursuant to the same or similar
documents, all such matters are solely in the control of the Company, not the
action or decision of the Investor, and would be solely for the convenience of
the Company and not because it was required or requested the Investor.

[signature page follows]
 
 
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IN WITNESS WHEREOF, the Investor and the Company have caused their respective
signature page to this Agreement to be duly executed as of the Effective Date.
 

 
COMPANY:  
         
GENEREX BIOTECHNOLOGY CORPORATION
             
By:
                 
Name:  
Rose C. Perri
     
Title:
Chief Financial Officer
             
By:
                             
Name:
Mark A. Fletcher
     
Title:
Executive Vice President and General Counsel
 

 
 
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IN WITNESS WHEREOF, the Investor and the Company have caused their respective
signature page to this Agreement to be duly executed as of the Effective Date.
 

 
INVESTOR:
         
CRANSHIRE CAPITAL, L.P.
           
By:
Downsview Capital, Inc. 
   
Its:   
General Partner
                     
By:
Mitchell P. Kopin            
   
Its:
President
 

 
 
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Schedule 1

“Equity Conditions” means: (i) on each day during the period beginning one month
prior to the applicable date of determination and ending on and including the
applicable date of determination either (x) a registration statement for the
resale of all shares of Common Stock issuable upon exercise of the Series
Warrants and the Pre-Extant Warrants on a continuous basis into the market at
prevailing market prices of all shares of Common Stock issuable upon exercise of
the Series Warrants and the Pre-Extant Warrants shall be effective and the
prospectus contained therein shall be available for use or (y) all shares of
Common Stock issuable upon exercise of the Series Warrants and the Pre-Extant
Warrants shall be eligible for sale without restriction and without the need for
registration under any applicable federal or state securities laws (in each
case, disregarding any limitations on exercise); (ii) on each day during the
period beginning three months prior to the applicable date of determination and
ending on and including the applicable date of determination (the “Equity
Conditions Measuring Period”), the shares of Common Stock are listed or
designated for quotation on an Eligible Market (as defined in the Note) and
shall not have been suspended from trading on an Eligible Market (other than
suspensions of not more than two (2) days and occurring prior to the applicable
date of determination due to business announcements by the Company) nor shall
delisting or suspension by an Eligible Market have been threatened (with a
reasonable prospect of delisting occurring) or pending either (A) in writing by
such Eligible Market or (B) by falling below the minimum listing maintenance
requirements of the Eligible Market on which the shares of Common Stock are then
listed; (iii) on each day during the Equity Conditions Measuring Period, the
Company shall have delivered all shares of Common Stock issuable upon conversion
of the Series Warrants and the Pre-Extant Warrants on a timely basis as set
forth therein and all other shares of capital stock required to be delivered by
the Company on a timely basis as set forth in the Transaction Documents; (iv)
any shares of Common Stock to be issued in connection with the event requiring
determination may be issued in full without violating the “blocker” provisions
thereof or the rules or regulations of the Eligible Market on which the Common
Stock is then listed; (v) on each day during the Equity Conditions Measuring
Period, no public announcement of a pending, proposed or intended Fundamental
Transaction (as defined in the Note) shall have occurred which has not been
abandoned, terminated or consummated; (vi) the Company shall have no knowledge
of any fact that would reasonably be expected to cause (1) the registration
statement described in clause (i) above not to be effective or the prospectus
contained therein not to be available for the resale of at least all of the
shares of Common Stock issuable upon exercise of the Series Warrants and the
Pre-Extant Warrants or (2) any shares of Common Stock issuable upon exercise of
the Series Warrants and the Pre-Extant Warrants not to be eligible for sale
without restriction pursuant to Rule 144 under the 1933 Act (as defined in the
Note) and any applicable state securities laws (in each case, disregarding any
limitations on exercise); (vii) the Investor shall not be in possession of any
material, non-public information provided to the Investor by the Company or any
of its affiliates or representatives; (viii) on each day during the Equity
Conditions Measuring Period, the Company otherwise shall have been in compliance
with and shall not have breached any provision, covenant, representation or
warranty of any Transaction Document (which, for clarification purposes,
includes, without limitation, this Agreement); (ix) on each day during the
Equity Conditions Measuring Period, there shall not have occurred an Event of
Default (as defined in the Note) or an event that with the passage of time or
giving of notice would constitute an Event of Default; and (x) on each day
beginning on the date of the Call Notice and ending on the Required Exercise
Date, no share of Common Stock shall trade for a price less than the Trigger
Price.
 
 
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