Exhibit 10.2


    Exhibit
      10.2

    OXIS
      INTERNATIONAL INC.

    


    COMMON
      STOCK PURCHASE WARRANT 

    


    NEITHER
      THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE BEEN
      REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR THE
      SECURITIES COMMISSION OF ANY STATE, OR UNDER THE SECURITIES ACT OF 1933, AS
      AMENDED (THE “ACT”). THIS WARRANT IS RESTRICTED AND MAY NOT BE OFFERED, RESOLD,
      PLEDGED OR TRANSFERRED EXCEPT AS PERMITTED UNDER THE ACT PURSUANT TO AN
      EFFECTIVE REGISTRATION STATEMENT OR AN EXEMPTION FROM SUCH REGISTRATION
      REQUIREMENTS. 

    


    OXIS
      INTERNATIONAL INC., a Delaware corporation (the “Company”), hereby certifies
      that, for value received, Fagan Capital Inc., a Texas corporation, the holder
      hereof (the “Holder”), is entitled, subject to the terms set forth below, to
      purchase from the Company at any time or from time to time before 5:00 P.M.
      New
      York time, on the Expiry Date, fully paid and nonassessable shares of the
      Company’s U.S. $.001 par value per share common stock (the “Common Stock”). The
      purchase price per share (the “Purchase Price”) shall (subject to adjustment
      pursuant to the terms hereof) be, in the event of a purchase at any time during
      the period commencing on the date hereof and ending on the Expiry Date, $0.35.
      The number of shares of Common Stock and the amount of the Purchase Price are
      subject to adjustment as provided herein. This Common Stock Purchase Warrant
      (this “Warrant”) may not be redeemed by the Company.

    


    This
      Warrant evidences the right to purchase an aggregate of 1,158,857 shares of
      Common Stock, subject to adjustment as provided in this Warrant. 

    


    As
      used
      herein, the following terms, unless the context otherwise requires, have the
      following respective meanings:

    


    (a) The
      term
“Company” includes any entity which shall succeed to or assume the obligations
      of the Company hereunder.

    


    (b)
       The
      term
“Expiry Date” means June 1, 2014. Notwithstanding, as of June 1, 2014 if the
      Company is not in compliance with all of its obligations under the Registration
      Rights Agreement (as defined below) between Holder and Company, , or any of
      its
      obligations under this Warrant, then the Expiry Date will be extended to the
      date which is two years after the date of full compliance with all its
      obligations under both this Warrant and the Registration Rights Agreement,
      including but not limited to complying with and effecting all of Holder’s Demand
      Registration rights (as defined in the Registration Rights Agreement).


    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    (c) The
      term
“Other Securities” refers to any stock (other than Common Stock) and other
      securities of the Company or any other person (corporate or otherwise) which
      the
      Holder at any time shall be entitled to receive, or shall have received, upon
      the exercise of this Warrant, in lieu of or in addition to Common Stock, or
      which at any time shall be issuable or shall have been issued in exchange for
      or
      in replacement of Common Stock or Other Securities pursuant to Section 6 or
      otherwise.

    


    (d) The
      term
“Registration Rights Agreement” refers to a registration rights agreement
      covering the Common Stock which may be acquired by Holder upon exercise of
      this
      Warrant, which agreement is intended to be executed by Company and Holder as
      soon as practicable after the issuance of this Warrant, and which will have
      the
      same effective date as this Warrant. Company and Holder have been negotiating,
      and agree to continue to negotiate in good faith and attempt to execute such
      Registration Rights Agreement, and agree that it will contain customary terms
      and conditions for a registration rights agreement, including but not limited
      to
      the granting to Holder of piggy-back registration rights beginning on the
      effective date of the Registration Rights Agreement and demand registration
      rights beginning on the first anniversary of the effective date of the
      Registration Rights Agreement. 

    


    (e) The
      term
“SEC,” “Securities and Exchange Commission” or “Commission” refers to the
      Securities and Exchange Commission or any other federal agency then
      administering the Securities Act.

    


    (f) The
      term
“Shares” means the Common Stock issued or issuable upon exercise of this
      Warrant.

    


    (g) The
      term
“Securities Act” means the Securities Act of 1933, as amended, or any successor
      federal statute, and the rules and regulations of the Securities and Exchange
      Commission thereunder, all as the same shall be in effect at the
      time.

    


    (h) The
      term
“Securities Exchange Act” means the Securities Exchange Act of 1934, as amended,
      or any successor federal statute, and the rules and regulations of the
      Securities and Exchange Commission thereunder, all as the same shall be in
      effect at the time.

    


    1. Restricted
      Stock.

    


    1.1
      Restrictive
      Legend.
      The
      certificates evidencing the Shares issuable upon any exercise of this Warrant
      shall, unless such Shares have been registered under the Securities Act, be
      unregistered securities and shall bear a restrictive legend similar to the
      legend on the first page of this Warrant.

    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    1.2
      Commission
      Filings.
      

    


    (a)
      The
      Company shall at all times keep adequate “current public information” available
      under, and otherwise comply with the requirements of, Rule 144 promulgated
      under
      the Securities Act.

    


    (b)
      The
      Company shall file with the Commission in a timely manner all required reports
      and other documents as the Commission may prescribe under Section 13(a) or
      15(d)
      of the Securities Exchange Act. 

    


    (c)
      The
      Company shall furnish to the Holder forthwith upon request, (i) a written
      statement by the Company as to its compliance with the reporting requirements
      under the Securities Act and of the reporting requirements of the Securities
      Exchange Act, (ii) a copy of the most recent annual or quarterly report of
      the
      Company, (iii) any other reports and documents necessary to satisfy the
      information-furnishing condition to offers and sales under Rule 144A under
      the
      Securities Act, and (iv) such other reports and documents as the Holder
      reasonably requests to avail itself of any rule or regulation of the Commission
      allowing the Holder to sell any such securities without
      registration.

    


    2. Exercise
      of Warrant.

    


    2.1 Exercise
      in Full.
      The
      Holder may exercise this Warrant in full by surrendering this Warrant, with
      the
      form of Notice of Exercise attached hereto as Attachment A duly executed by
      the
      Holder, to the Company at its principal office. The surrendered Warrant shall
      be
      accompanied by payment in the amount obtained by multiplying the number of
      Shares which may be purchased pursuant to this Warrant, by the then applicable
      Purchase Price. 

    


    2.2 Partial
      Exercises.
      The
      Holder may exercise this Warrant in part (one or more times) by surrendering
      this Warrant and a completed Notice of Exercise in the manner and at the place
      provided in Subsection 2.1 except that the number of Shares obtained through
      a
      partial exercise shall be the number of Shares as shall be designated by the
      Holder in the Notice of Exercise. The surrendered Warrant shall be accompanied
      by payment in an amount equal to (a) the number of Shares as shall be designated
      by the Holder in the Notice of Exercise multiplied
      by
      (b) the
      then applicable Purchase Price. After each such partial exercise, the Company
      at
      its expense will forthwith issue and deliver to the Holder a new Warrant of
      like
      tenor, in the name of the Holder, pursuant to which the Holder may thereafter
      purchase a number of Shares equal to the aggregate number of Shares which could
      have been purchased pursuant to a full exercise of the Warrant immediately
      prior
      to the most recent partial exercise, less
      the
      number of such Shares purchased pursuant to the most recent partial
      exercise.

    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    2.3 Company
      Acknowledgment.
      The
      Company will, at the time of any exercise, exchange or transfer of this Warrant,
      upon the request of the Holder, acknowledge in writing its continuing obligation
      to afford to the Holder any rights (including, without limitation, any right
      to
      registration of the Shares) to which the Holder shall continue to be entitled
      after such exercise or exchange in accordance with the provisions of this
      Warrant. If the Holder shall fail to make any such request, such failure shall
      not affect the continuing obligation of the Company to afford to the Holder
      any
      such rights.

    


    2.4 Payment.
      

    


    (a)
      Upon
      any exercise of this Warrant, in full or in part, Holder may, in lieu of paying
      cash, elect a cashless exercise through the surrender of certain Shares that
      would otherwise be acquired upon such exercise (using a valuation per Share
      for
      such purpose equal to the closing sales price, or the closing bid price if
      no
      sales occurred, on the business day immediately preceding such exercise), all
      as
      more fully illustrated in Section 2.4(b). 

    


    (b)
      To
      illustrate the application of Section 2.4(a), assume the following (all
      assumptions are for illustration purposes only): Purchase Price remains at
      $.35.
      The closing per share sales price on the business day immediately preceding
      the
      exercise, is $.85. There is a net unrealized gain of $579,428.50 (based on
      1,158,857 shares times the $.50 per share difference between the immediately
      preceding closing price and the Purchase Price). Holder wishes to exercise
      this
      Warrant in full. Holder may either (i) Pay $405,600 cash and receive 1,158,857
      Shares or (ii) elect a cashless exercise, by paying no cash and receiving that
      number of Shares which has a value equal to the net unrealized gain, which
      in
      this example is 681,681 shares (valued at $.85 per share), whereupon in either
      case this Warrant would be deemed fully exercised. 

    


    3. Delivery
      of Stock Certificates, Etc., on Exercise.
      As soon
      as practicable after the exercise of this Warrant, in full or in part, (a)
      the
      Holder hereof shall be deemed to be the record owner of the number of fully
      paid
      and non-assessable Shares to which the Holder shall be entitled upon such
      exercise and (b) in any event within ten (10) business days thereafter, the
      Company, at its expense (including the payment by it of any applicable issue
      taxes), will cause to be issued in the name of and delivered to the Holder,
      a
      certificate or certificates for the number of fully paid and nonassessable
      Shares to which the Holder shall be entitled on such exercise. No fractional
      Share or scrip representing a fraction of a Share will be issued on exercise,
      but the number of Shares issuable shall be rounded up to the nearest whole
      Share.

    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    4. Adjustment
      for Reorganization, Consolidation, Merger, Etc.

    


    4.1
      Merger,
      Etc.
      If the
      Company shall (a) consolidate with or merge into any other person, or (b)
      transfer all or substantially all of its properties or assets to any other
      person under any plan or arrangement contemplating the dissolution of the
      Company (any such transaction being hereinafter sometimes referred to as a
      “Reorganization”) then, in each such case, the Holder, on the exercise hereof as
      provided in Section 2, at any time after the consummation or effective date
      of
      such Reorganization (the “Effective Date”), shall receive, in lieu of the Shares
      issuable on such exercise prior to such consummation or such Effective Date,
      the
      stock and Other Securities and other property (including cash) to which the
      Holder would have been entitled upon such consummation or in connection with
      such dissolution, as the case may be, if the Holder had so exercised this
      Warrant, immediately prior thereto. The successor entity in any such
      Reorganization, where the Company will not be the surviving entity (the
“Acquiring Company”), must agree prior to such Reorganization in a writing
      satisfactory in form and substance to the Holder that this Warrant shall
      continue in full force and effect and the terms hereof shall be applicable
      to
      the shares of stock and Other Securities and other property receivable on
      exercise after the consummation of such Reorganization, and shall be binding
      upon the issuer of any such stock or Other Securities (including, in the case
      of
      any transfer of properties or assets referred to above, the person acquiring
      all
      or substantially all of the properties or assets of the Company). If the
      Acquiring Company has not so agreed to continue this Warrant, then the Company
      shall give 30 days' prior written notice to the Holder of such Reorganization,
      during which 30-day period (the “Notice Period”) the Holder at the Holder's
      option and upon written notice to the Company shall be able to (i) exercise
      this
      Warrant or any part thereof at an exercise price (the “Discounted Exercise
      Price”) equal to the then prevailing Purchase Price hereunder discounted at the
      Discount Rate (as used herein the “Discount Rate” shall mean the then prevailing
      interest rate on U.S. Treasury Notes issued on (or immediately prior to) the
      date of such 30-day notice and maturing on the Expiry Date (or immediately
      prior
      thereto), such rate to be compounded annually through the Expiry Date, and
      in no
      event to be less than 10% annually); or (ii) on the Effective Date, the Holder
      shall be paid an amount (the “Merger Profit Amount”) equal to the difference
      between the fair market value per share of Common Stock being purchased by
      the
      Acquiring Company in the Reorganization and the Discounted Exercise Price
      described in clause (i) above, and the Warrant shall thereafter expire. The
      Merger Profit Amount shall be payable in cash. The fair market value of any
      noncash property received from the Acquiring Company upon the Reorganization
      shall be determined in good faith by the Board of Directors of the Company
      relying upon a good faith independent appraisal of such noncash
      property.

    


    4.2
      Dissolution.
      In the
      event of any dissolution of the Company following the transfer of all or
      substantially all of its properties or assets, the Company, prior to such
      dissolution, shall at its expense deliver or cause to be delivered the stock
      and
      Other Securities and other property (including cash, where applicable)
      receivable by the Holder after the effective date of such dissolution pursuant
      to this Section 4 to a bank or trust company having its principal office in
      New
      York, New York, as trustee for the Holder.


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    4.3
      Continuation
      of Terms.
      Except
      as otherwise expressly provided in Subsection 4.1, upon any reorganization,
      consolidation, merger or transfer (and any dissolution following any transfer)
      referred to in this Section 4, this Warrant shall continue in full force and
      effect and the terms hereof shall be applicable to the shares of stock and
      Other
      Securities and other property receivable on the exercise of this Warrant after
      the consummation of such reorganization, consolidation or merger or the
      effective date of dissolution following any such transfer, as the case may
      be,
      and shall be binding upon the issuer of any such stock or Other Securities,
      including, in the case of any such transfer, the person acquiring all or
      substantially all of the properties or assets of the Company, whether or not
      such person shall have expressly assumed the terms of this Warrant as provided
      in Section 4.1.

    


    5. No
      Impairment.
      The
      Company will not, by amendment of its certificate of incorporation or through
      any reorganization, transfer of assets, consolidation, merger, dissolution,
      issue or sale of securities or any other voluntary action, avoid or seek to
      avoid the observance or performance of any of the terms of this Warrant, but
      will, at all times, in good faith, assist in the carrying out of all such terms
      and in the taking of all such action as may be necessary or appropriate in
      order
      to protect the rights of the Holder against dilution or other impairment.
      Without limiting the generality of the foregoing, the Company covenants that
      it
      (a) will not increase the par value of any shares of stock receivable on the
      exercise of this Warrant and (b) will at all times reserve and keep available
      out of its authorized capital stock, solely for the purpose of issue upon
      exercise of this Warrant as herein provided, such number of shares of Common
      Stock as shall then be issuable upon exercise of this Warrant in full, taking
      into account the full application of the anti-dilution provisions, and shall
      take all such action as may be necessary or appropriate in order that all shares
      of Common Stock that shall be so issuable shall be duly and validly issued
      and
      fully paid and nonassessable and free from all taxes, liens and charges with
      respect to the issue thereof.

    


    6.
       Anti-Dilution
      Provisions.

    


    (a)
       In
      the
      event the Company shall pay a share dividend or other distribution payable
      in
      shares of Common Stock, the Purchase Price in effect immediately prior (and
      each
      Purchase Price in effect subsequent) to such dividend or distribution shall,
      concurrently with the effectiveness of such dividend or distribution, be
      proportionately adjusted. Specifically, in the case of a share dividend or
      other
      distribution payable in shares of Common Stock such adjustment shall occur
      as
      follows: the Purchase Price that is then in effect (and in effect at any time
      thereafter) shall be decreased as of the time of such issuance, or in the event
      a record date is fixed, as of the close of business on such record date, by
      multiplying the Purchase Price then (and therefore) in effect by a fraction
      (1)
      the numerator of which is the total number of shares of issued Common Stock
      immediately prior to the time of such issuance or the close of business on
      such
      record date, as the case may be, and (2) the denominator of which is the
      aggregate of (A) the number of shares of issued Common Stock immediately prior
      to the time of such issuance or the close of business on such record date
plus
      (B) the
      number of shares of Common Stock to be issued in payment of such dividend or
      distribution. 

    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    (b)
       In
      the
      event the issued shares of Common Stock shall be subdivided, combined or
      consolidated, by reclassification or otherwise, into a greater or lesser number
      of shares of Common Stock, the number of Shares which may be purchased pursuant
      to this Warrant and the Purchase Price shall be proportionately adjusted, in
      accordance with the example in Section 6(d).

    


    (c) If
      the
      Company shall, after the date of issuance of this Warrant, (i) issue any Common
      Stock or Common Stock Equivalents for a consideration per share less than the
      Purchase Price in effect immediately prior to the issuance of such Common Stock
      or Common Stock Equivalent, or (ii) amend any outstanding Common Stock
      Equivalent such that Common Stock is issuable thereunder (whether or not
      actually issued) for a consideration per share less than the Purchase Price
      in
      effect immediately prior to the amendment of such Common Stock Equivalent,
      then
      in either case the Purchase Price in effect immediately after each such issuance
      or amendment shall forthwith be adjusted downward (but never upward) to a price
      equal to the price per share (net of selling expenses) received by the Company
      for such Common Stock or Common Stock Equivalents. For purposes of this Section
      6(c): 

    


    (i)
      “Common Stock Equivalents” are defined to include options or warrants to
      purchase or rights to subscribe for Common Stock, securities by their terms
      convertible into or exchangeable for Common Stock, and options to purchase
      or
      rights to subscribe for such convertible or exchangeable securities, provided
      however, that the term Common Stock Equivalents excludes the first 2,300,000
      common stock purchase options granted by the Company to directors or employees
      of the Company after the effective date of this Warrant. The term “2,300,000
      common stock purchase options” in the previous sentence will be construed on the
      basis of the following: (1) each such option can convey to the holder the right
      to purchase no more than one share of Common Stock and (2) the 2,300,000 figure
      will be adjusted proportionately hereafter for any events described in Sections
      6(a) and 6(b) hereof (in accordance with the example in Section 6(d)).


     

    (ii)
      In
      the case of the issuance of Common Stock Equivalents, the aggregate maximum
      number of shares of Common Stock deliverable upon exercise or conversion of
      such
      Common Stock Equivalents shall for all purposes be deemed to have been issued
      at
      the time such Common Stock Equivalents were issued (or, as applicable, at any
      time they are subsequently amended), and for a consideration equal to the
      consideration, if any, received by the Company upon the issuance (or amendment)
      of such Common Stock Equivalents plus the minimum additional consideration,
      if
      any, to be received by the Company upon exercise or conversion thereof into
      Common Stock.

     


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    (iii)
      Upon the final expiration of any such Common Stock Equivalents, the Purchase
      Price (as to any Shares remaining available for purchase under this Warrant)
      to
      the extent in any way affected by the issuance of such Common Stock Equivalents
      shall be recomputed to reflect the issuance of only the shares of Common Stock
      actually issued upon the exercise or conversion of such Common Stock Equivalents
      for the price per share (net of selling expenses) actually received by the
      Company.

     

    (iv)
      No
      adjustment shall be made for the actual issuance of Common Stock upon the
      exercise or conversion of any Common Stock Equivalents, to the extent that
      adjustments were already made in connection with the issuance or amendment
      of
      Common Stock Equivalents which gave rise to the ultimate issuance of such Common
      Stock. 

     

    (d)
       Notwithstanding
      anything else to the contrary contained in this Warrant, each time that an
      adjustment is required to be made to the Purchase Price, proportionate
      adjustments will also be made to the number of Shares which may be purchased
      pursuant to this Warrant, so that (I) and (II) are equal, whereby (I) equals
      the
      total proceeds payable to the Company upon exercise in full of this Warrant
      immediately prior to such adjustment to the Purchase Price, and (II) equals
      the
      total proceeds payable to the Company upon exercise in full of this Warrant
      immediately after such adjustment to the Purchase Price. As an example of how
      the provisions of this Section 6 shall be applied, assume that the number of
      Shares which may be purchased upon exercise of this Warrant at a point in time
      is 2,000,000 Shares, and that at such point in time, the Purchase Price is
      $0.20, such that an exercise in full of this Warrant would yield proceeds to
      the
      Company of $400,000. Assume further that the Company effects a two-for-one
      stock
      split, which results in the Purchase Price being adjusted to $.10. Upon the
      effective date of such two-for-one stock split, the number of Shares which
      may
      be purchased upon exercise of this Warrant will be adjusted to be 4,000,000
      Shares so that an exercise in full of this Warrant would still yield proceeds
      to
      the Company of $400,000. Upon the occurrence of each adjustment pursuant to
      this
      Section 6, the Company shall prepare, and promptly provide to the Holder, a
      certificate setting forth such adjustment and showing in detail the facts upon
      which such adjustment is based.

    


    (e)
       In
      the
      event the Company shall pay a dividend or other distribution in cash or noncash
      property (other than shares of Common Stock), the Purchase Price shall be
      adjusted downward in an amount equal to the value of such dividend or other
      distribution. The fair market value of any noncash property shall be determined
      in good faith by the Board of Directors of the Company relying upon a good
      faith
      independent appraisal of such noncash property.

    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    (f)
       Company
      and Holder acknowledge that Company and certain of its subsidiaries are, were
      or
      will be obligated to Holder separately under that certain Renewal and
      Modification Promissory Note (the “Renewal Note”) which was issued on or about
      the same date as this Warrant was issued. Upon any Event of Default under the
      Renewal Note (as defined in the Renewal Note), and regardless of whether this
      Warrant and the Renewal Note are owned by the same person at such time, the
      Purchase Price will be adjusted downward by 10% on the first day of each and
      every month thereafter until all amounts outstanding under the Renewal Note
      are
      repaid in full. 

    


    (g)
       There
      will be no aggregating of Purchase Price adjustments. Each event which gives
      rise to a Purchase Price adjustment will in fact give rise to a separate
      Purchase Price adjustment hereunder. 

    


    
      	 	
              (h)
                

            	
              In
                case at any time after the date of this
                Warrant:

            


    

     

    (i)
       The
      Company shall authorize (or events shall have occurred resulting in) any action
      referred to in Section 4 or Section 6 of this Warrant, or

    


    (ii)
       The
      Company shall authorize (or events shall have occurred resulting in) any action
      for which approval of any shareholders of the Company is required,

    


    then
      the
      Company shall cause to be sent to the Holder as soon as possible but not later
      than at least thirty (30) days prior to any relevant record date, a written
      notice stating (1) the date on which a record is to be taken, or if a record
      is
      not to be taken, the date as of which any rights are to be determined or any
      other actions are expected to become effective. 

    


    
      	7.  	
              Representations
                and Warranties; Covenants.

            


    

    


    7.1 Representations
      and Warranties.
      The
      Company represents and warrants to the Holder as follows:

    


    (a) The
      Company is a corporation duly organized, validly existing and in good standing
      under the laws of the State of Delaware.

    


    (b) The
      execution, delivery, and performance of this Warrant by the Company are within
      the Company’s corporate powers, have been duly authorized by all necessary
      corporate action, and do not contravene (i) the Company’s charter or by-laws or
      (ii) any law or any contractual restriction binding on or affecting the Company,
      any subsidiary of the Company, or its or their properties.

    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    (c) No
      authorization or approval or other action by, and no notice to or filing with,
      any governmental authority or regulatory body is required for the due execution,
      delivery, and performance by the Company of this Warrant and any other documents
      or instruments executed or to be executed by the Company in connection with
      this
      Warrant.

    


    (d) This
      Warrant constitutes the legal, valid, and binding obligation of the Company,
      enforceable against the Company in accordance with its terms. Upon any issuance
      of Shares hereunder, such Shares will be duly authorized, validly issued, and
      fully-paid and non-assessable and free of any preemptive rights. The Company
      has, by formal action of its Board of Directors, reserved the maximum number
      of
      Shares that may be issued upon the full exercise of this Warrant and authorized
      the issuance of such Shares upon any exercise of this Warrant.

    


    


    (e) All
      information and other materials concerning the Company or any subsidiary of
      the
      Company which have been made available to the Holder by, or on behalf of the
      Company or any subsidiary of the Company, are complete and correct in all
      material respects and do not contain any untrue statement of material fact
      or
      omit to state a material fact necessary in order to make the statements
      contained therein not misleading in light of the circumstances under which
      such
      statements have been made.

    


    (f) There
      is
      no action, litigation, investigation, or proceeding pending or, to the knowledge
      of the Company, threatened against the Company or any subsidiary of the Company
      before any court, arbitrator, or administrative agency which might result in
      any
      material adverse change in the business, assets, liabilities, or condition
      (financial or otherwise) of the Company.

    


    7.2 Covenants.
      The
      Company covenants and agrees with the Holder that the following will be true
      and
      correct until the Expiry Date:

    


    (a) The
      Company will, and will cause each of its subsidiaries to, comply in all material
      respects with all applicable laws, ordinances, rules, regulations, orders and
      other requirements of governmental authorities.

    


    (b) The
      Company will, and will cause each of its subsidiaries to, maintain and preserve
      their existence, rights and privileges, intellectual property, licenses and
      franchises and obtain, maintain, and preserve all permits, licenses,
      authorizations and approvals that are necessary in the proper conduct of their
      business.

    


    (c) The
      Company will, and will cause each of its subsidiaries to, keep adequate and
      proper records and books of account, in which complete and correct entries
      will
      be made in accordance with generally accepted accounting principles consistently
      applied, reflecting all financial matters and transactions in relation to the
      business and activities of the Company and its subsidiaries and
      affiliates.

    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    (d) The
      Company will file, and will cause each of its subsidiaries to file, on a timely
      basis, all federal, state and local tax returns and other reports required
      by
      applicable law to be filed and all taxes, assessments and other charges imposed
      by any governmental authority upon the Company and any subsidiary of the
      Company, or any property of the Company or any subsidiary of the Company
      (including, without limitation, all federal income and social security taxes
      on
      employees' wages) and all such taxes, assessments and other charges which become
      due and payable shall be paid when due.

    


    (e) The
      Company will (i) continue to be a reporting company required to make filings
      under the Securities Exchange Act and (ii) timely make all filings required
      by
      the Securities Exchange Act.

    


    (f) The
      Company will (i) not increase the par value per share of the Common Stock and
      (ii) promptly take any and all action necessary to always have sufficient
      authorized but unissued shares of Common Stock (A) available to comply with
      the
      terms of this Warrant and (B) reserved for issuance upon exercise in full of
      this Warrant.

    


    8. Reporting
      Requirements.
      The
      Company shall provide written notice to the Holder of any “Ineffective Period,”
as defined below, within ten (10) days of the commencement of any Ineffective
      Period. The term “Ineffective Period” shall mean any period of time after the
      effective date of a Registration Statement prior to the Expiry Date that such
      Registration Statement or any supplemental or amended Registration Statement
      becomes ineffective or unavailable for use for the sale or resale, as
      applicable, of any or all of the Shares for any reason (or in the event the
      prospectus included in such Registration Statement is not current and
      deliverable).

    


    9. Replacement
      of Warrants.
      On
      receipt of evidence reasonably satisfactory to the Company of the loss, theft,
      destruction or mutilation of this Warrant, the Company at its expense will
      promptly execute and deliver, in lieu thereof, a new Warrant of like
      tenor.

    


    10. Expenses.
      The
      Company agrees to pay any and all stamp, transfer and other similar taxes
      payable or determined to be payable in connection with the execution and
      delivery of this Warrant and the issuance of this Warrant or the
      Shares.

    


    11. Warrant
      Agent.
      The
      Company may, by written notice to the Holder, appoint an agent, or U.S. Stock
      Transfer Corp., for the purpose of issuing Shares on the exercise of this
      Warrant. 

    


    12. Remedies.
      The
      Company stipulates that the remedies at law of the Holder, in the event of
      any
      default or threatened default by the Company in the performance of or compliance
      with any of the terms of this Warrant, are not and will not be adequate, and
      that such terms may be specifically enforced by a decree for the specific
      performance of any agreement contained herein or by an injunction against a
      violation of any of the terms hereof or otherwise.

    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    13. Assignment;
      Registered.
      The
      Holder may assign all or a portion of its rights under this Warrant to any
      person or entity and the Company shall promptly issue a Warrant of like tenor
      (a) to the assignee for the number of Shares such assignee is entitled to
      purchase and (b) to the Holder for the number of Shares the Holder remains
      entitled to purchase following the assignment. Until this Warrant is transferred
      on the books of the Company, the Company may treat the registered holder hereof
      as the absolute owner hereof for all purposes, notwithstanding any notice to
      the
      contrary.

    


    14. Notices,
      Etc.
      All
      notices and other communications from the Company to the Holder shall be mailed
      by first class registered or certified mail, postage prepaid, at such address
      as
      may have been furnished to the Company in writing by the Holder.

    


    15. Miscellaneous.
      This
      Warrant and any term hereof may be changed, waived, discharged or terminated
      only by an instrument in writing signed by the Holder and the Company. This
      Warrant shall be construed and enforced in accordance with and governed by
      the
      internal laws (and not the conflicts laws) of Delaware. The headings in this
      Warrant are for purposes of reference only, and shall not limit or otherwise
      affect any of the terms hereof. This Warrant is being executed as an instrument
      under seal. All nouns and pronouns used herein shall be deemed to refer to
      the
      masculine, feminine or neuter, as the identity of the person or persons to
      whom
      reference is made herein may require.

    


    16. Expiration.
      The
      right to exercise this Warrant shall expire at 5:00 P.M.,
      New
      York time, on the Expiry Date.

    


    Dated
      Effective: June 2, 2006.

    


    


    OXIS
      INTERNATIONAL INC.

    


    By: 
      /s/
      Steven T. Guillen    

    Name:
      Steven T. Guillen  

    Title:
      President & Chief Executive Officer


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    ATTACHMENT
      A

    


    


    NOTICE
      OF EXERCISE

    


    (To
      be
      Executed by the Registered Holder in order to Exercise the Warrant)

    


    The
      undersigned holder hereby irrevocably elects to purchase _________ shares of
      Common Stock of OXIS INTERNATIONAL INC. (the “Company”) pursuant to the Common
      Stock Purchase Warrant issued by the Company according to the conditions set
      forth in said warrant and as of the date set forth below.*

    


    Date
      of
      Exercise: ________________________________________ 

    


    Number
      of
      Shares be Purchased: __________________________________________

    


    Applicable
      Total Purchase Price: __________________________________________

    


    Method
      of
      exercise (Cash or Cashless): ____________________________________

    


    If
      this
      is a Cashless exercise, provide detail on an attachment to this Notice, showing
      the methodology and results calculated in accordance with Section 2.4 of
      Warrant.

    


    Signature: 

    [Name]

    


    Address: 

    


    


    The
      Warrant must accompany this Notice of Exercise.