Document:

EXHIBIT
10.1

 

WARRANT
PURCHASE AGREEMENT

 

 

THIS
WARRANT PURCHASE AGREEMENT (the "Agreement") is made and entered into this 12th
day of May, 2005 effective as of August 31, 2004 by and between POSITRON
CORPORATION, a Texas corporation (the "Company"), and those persons set forth on
the signature page hereof as Investors (the "Investors").

 

R E C
I T A L S :

 

WHEREAS,
the Company desires to issue to Investors and the Investors desire to purchase
from the Company, warrants (the "Warrants") to purchase 3,825,000 shares of the
Company's common stock (the "Shares") all on the terms and conditions
hereinafter provided. The Warrants and the Shares are hereafter collectively
referred to as the "Securities".

 

NOW,
THEREFORE, IT IS AGREED AS FOLLOWS:

 

1.  Issuance
of Warrants; Repurchase Right. In
consideration of the surrender to the Company by the Investors of warrants to
purchase an aggregate of 7,650,000 shares of the Company's common stock, the
Company agrees to issue to Investors an aggregate of 3,825,000 Warrants, the
form of which is attached hereto as Exhibit A, in the amounts and to the
Investors as set forth on the signature page hereto.

 

2.  Investors
Representations. The
Investors hereby severally represent and warrant to the Company as
follows:

 

(a)  The
Investors understand that: (i) the offer and sale of the Securities by the
Company to the Investors has not been registered under the Securities Act of
1933, as amended (the "Securities Act"), in reliance on an exemption from such
registration available under the Securities Act and rules adopted thereunder;
and (ii) the Investors must hold the Warrants indefinitely unless the Securities
are subsequently registered under the Securities Act and qualified under
applicable state securities laws, or unless an exemption from such registration
and qualification are available.

 

(b)  The
Investors are acquiring the Securities for his or her own account, for
investment, and not with a view to any sale or distribution of any interest
therein.

 

(c)  The
Investors have such knowledge and experience in financial and business matters
as to be capable of evaluating the merits and risks of an investment in the
Securities, and the Investors is able to bear the economic risks of such an
investment.

 

 

(d)  All
statements made, and information furnished, by the Investors in this certificate
and all other information furnished by the Investors to the Company, are true
and complete, to the best of the Investors' knowledge.

 

3.  Restrictions
on Transfer. The
Investors agree that:

 

(a)  The
Investors will not attempt to transfer the Securities in violation of the
restrictions set forth in this Agreement.

 

(b)  The
Company may note such restrictions on transfer in its records and refuse to
recognize any transfer which violates this agreement or for which the Company
has not received an acceptable opinion of counsel stating that such transfer
will not violate such restrictions.

 

(c)  One or
more legends indicating a lack of registration under the Securities Act and a
lack of qualification under state securities laws will be imprinted on the
Securities. One such legend shall read substantially as follows:

 

"THE
SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY, TRANSFERRED, ASSIGNED,
PLEDGED OR HYPOTHECATED EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S
PROMULGATED UNDER THE SECURITIES ACT, PURSUANT TO REGISTRATION UNDER THE
SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM
REGISTRATION."

 

4.  Binding
on Successors; Indemnification. The
Investors agree that the above representations and warranties are binding on the
Investors' successors and assigns and are made for the benefit of the Company
and any other persons who may become liable for violations of federal or state
securities laws as a result of the falsity of any of the Investors'
representations or warranties. The Investors agree to indemnify, defend, and
hold harmless such persons from any liability arising from the falsity of any of
the Investors' representations or warranties or from the breach of any covenant
of Investors contained herein. 

 

5.  Registration
Rights. The
Company hereby grants to Investors the following registration rights with
respect to the Shares:

 

(a)  Notice
of Registration. If, at
any time after the date hereof, the Company shall determine to register any of
its securities either for its own account or the account of a security holder or
holders exercising their respective demand registration rights, other than a
registration relating solely to employee benefit plans, or a registration
relating solely to a Commission Rule 145 transaction, or a registration on any
registration form which does not permit secondary sales, the Company will:

 

(i)  promptly
give to Investors written notice thereof (which shall include a list of the
jurisdictions in which the Company intends to attempt to qualify such securities
under the applicable blue sky or other state securities laws); and 

 

-2-

 

(ii)  include
in such registration (and any related qualification under blue sky laws or other
compliance), and in any underwriting involved therein, all the shares of the
Company's common stock exercisable upon exercise of the Warrants and any common
stock issued with respect thereto (e.g. upon a stock split or stock dividend)
specified in a written request or requests, made by Investors within fifteen
(15) days after receipt of the written notice from the Company described in this
clause. Notwithstanding the foregoing, if the underwriter advises the Company in
writing that marketing factors require a limitation of the number of shares to
be underwritten, then the Company shall so advise all holders of common stock
which would otherwise be underwritten pursuant to existing registration rights,
and the number of shares of common stock that may be included in the
underwriting shall be allocated among all holders thereof, including the
Investors, in proportion (as nearly as practicable) to the amount of shares of
common stock of the Company owned by each holder. 

 

(b)  The
Company shall bear all registration expenses, except selling expenses, incurred
in connection with any registration, qualification and compliance by the Company
pursuant to Section 5(a).

 

6.  Repurchase
Right.
The
Company reserves to itself the right to repurchase upon 30 says written notice
any portion of the Warrants issued pursuant to this Agreement ("Repurchase
Right") at any time after August 31, 2004, provided that the closing price of a
share of the Company's common stock shall be not less than $0.25 for a period at
least 20 consecutive trading days after August 31, 2004; and provided further
that a
registration statement filed pursuant to Section 5, above, permitting a sale of
the Shares shall have become effective and remain effective for a period of 90
days. The
repurchase price will be $0.001 per share for any portion of the Warrants that
remain unexercised at the time the Company exercises its Repurchase
Right. 

 

7.  Governing
Law. This
Agreement shall be governed by and construed in accordance with the laws of the
State of Texas.

 

8.  Counterparts. This
Agreement may be executed in any number of counterparts, each of which shall be
an original, but all of which together shall constitute one
instrument.

 

IN
WITNESS WHEREOF, the undersigned purchasers of securities and the Company have
executed this Agreement as of the day and year first above written.

 

 

-3-

 

[Signature
Page to Warrant Purchase Agreement]

 

 

	 	POSITRON
      CORPORATION	 
	 	 	 
	 	By:  ____________________________________________________	 
	 	Gary H. Brooks, President	 
	 	 	 
	 	 	 
	 	INVESTORS:	 
	 	 	 
	 	 	 
	 	Carlos Sao Paulo	 
	 	Warrants: 1,325,000	 
	 	 	 
	 	 	 
	 	Sofia Salema Garção 	 
	 	Warrants: 2,000,000	 
	 	 	 
	 	 	 
	 	Maria Madalena Pimentel	 
	 	Warrants: 1,650,000	 
	 	 	 
	 		 
	 	José Maria Salema Garção 	 
	 	Warrants: 2,000,000	 

 

-4-EXHIBIT
10.2

 

THE
SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY, TRANSFERRED, ASSIGNED,
PLEDGED OR HYPOTHECATED EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S
PROMULGATED UNDER THE SECURITIES ACT, PURSUANT TO REGISTRATION UNDER THE
SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM
REGISTRATION.

 

POSITRON
CORPORATION

COMMON
STOCK PURCHASE WARRANT

TO
PURCHASE ___________ SHARES OF COMMON STOCK

OF
POSITRON CORPORATION

 

This
Warrant Expires August 31, 2005 Subject to Extension Pursuant to Section
14

	
      Warrant
      No. 05-00_
	
      ___________
      Shares

	 	 

 

THIS
CERTIFIES that, subject to the terms and conditions herein set forth in this
Warrant, _____________ (the "Holder") is
entitled to purchase from Positron Corporation, a Texas corporation
("Company"), at
any time or from time to time during
the Exercise Period (defined in Section 14 below) and subject to the provisions
regarding Exercise of Warrant (as set forth in Section 6 below) the number of
fully paid and non-assessable shares of Common Stock of the Company (the
"Shares") as
provided herein upon surrender of this Warrant at the principal office of the
Company, and, at the election of the Holder, upon payment of the purchase price
at said office in cash or by cashier's check or by the wire transfer of funds in
a dollar amount equal to the purchase price of the Shares for which the
consideration is being given. 

 

This
Warrant shall be exercisable for that number of Shares as set forth
above.

 

1.  Purchase
Price. Subject
to adjustment as hereinafter provided, the purchase price of one share of Common
Stock (or such securities as may be substituted for one share of Common Stock
pursuant to the provisions hereinafter set forth) (the "Warrant
Price") shall
be five cents ($0.02). 

 

2.  Adjustment
of Warrant Price and Number of Shares. The
number and kind of securities issuable upon the exercise of this Warrant shall
be subject to adjustment from time to time upon the happening of certain events
as follows: 

 

a.  Adjustment
for Dividends in Stock. If at
any time on or after the date hereof, the holders of the Common Stock of the
Company (or any shares of stock or other securities at the time receivable upon
the exercise of this Warrant) shall have received, or, on or after the record
date fixed for the determination of eligible shareholders, shall have become
entitled to receive, without payment therefor, other or additional stock of the
Company by way of dividend (other than as provided for in Section 2(b) below),
then and in each such case, upon the exercise of this Warrant, the Holder shall
be entitled to receive, in addition to the number of shares of Common Stock
receivable, and without payment of any additional consideration therefor, the
amount of such other or additional stock of the Company which the Holder would
have received on the date of such exercise had it been the holder of record of
such Common Stock on the date hereof and had Holder thereafter, during the
period from the date hereof to and including the date of such exercise, retained
such shares and/or all other additional stock receivable by it as aforesaid
during such period and given effect to all adjustments called for during such
period by this Section 2. 

 

 

b.  Adjustment
for Changes in Common Stock. In the
event of changes in the outstanding Common Stock of the Company by reason of
stock splits, recapitalizations, reclassifications, mergers, consolidations,
combinations or exchanges of shares, separations, reorganizations, liquidations,
or the like, the number and class of shares available under the Warrant in the
aggregate and the Warrant Price shall be correspondingly adjusted by the Board
of Directors of the Company. The adjustment shall be such as will give the
Holder on exercise for the same aggregate Warrant Price the total number, class,
and kind of shares as the Holder would have owned had the Warrant been exercised
immediately prior to the event and had the Holder continued to hold such shares
until after the event requiring adjustment.

 

The
foregoing provisions of subparagraph (b) notwithstanding, if at any time while
this Warrant, or any portion thereof, is outstanding and unexpired there shall
be (i) a reorganization (other than a combination, reclassification, exchange or
subdivision of shares otherwise provided herein), (ii) a merger or consolidation
of the Company with or into another entity in which the Company is not the
surviving entity, or a reverse triangular merger in which the Company is the
surviving entity but the shares of the Company's capital stock outstanding
immediately prior to the merger are converted by virtue of the merger into other
property, or (iii) a sale or transfer of all or substantially all the Company's
properties and assets to any other person and further, if as
part of such reorganization, merger, sale or transfer the Holder is entitled to
exercise the Warrant or any portion thereof and, upon payment of the Warrant
Price in effect at the time, is entitled to receive that number of shares of the
successor corporation resulting from such reorganization, merger, sale or
transfer deliverable upon exercise of the Warrant and thereupon exchangeable
into shares of the successor corporation, but
further, such
Holder shall fail or refuse to exercise the Warrant or any portion then
outstanding, then this Warrant or any outstanding portion thereof shall
terminate upon the lapse of ten (10) calendar days following such failure or
refusal to exercise the Warrant and/or any portions thereof remaining
outstanding and unexpired as of the effective date of the reorganization,
merger, sale or transfer.

 

3.  No
Fractional Shares. No
fractional shares of Common Stock will be issued in connection with any
subscription under this Warrant. In lieu of any fractional shares which would
otherwise be issuable, the Company shall pay cash equal to the product of such
fraction multiplied by the fair value of one share of Common Stock on the date
of exercise as determined in good faith by the Company's Board of Directors.

 

-2-

 

4.  No
Shareholder Rights. This
Warrant shall not entitle its holder to any of the rights of a shareholder of
the Company prior to its exercise, including but not limited to the entitlement
to vote or receive dividends, to receive notice of meetings, or otherwise to be
deemed the holder of Common Stock or any other securities of the Company that
may at any time be issuable on exercise hereof for any purpose

 

5.  Reservation
of Stock. The
Company covenants that during the period this Warrant is exercisable, the
Company will reserve from its authorized and unissued Common Stock a sufficient
number of shares to provide for the issuance of Common Stock upon the exercise
of this Warrant. If at any relevant time the number of authorized but unissued
shares of Common Stock is insufficient to allow for full exercise of this
Warrant, the Company will use its reasonable efforts to forthwith take such
corporate action as may be necessary to increase its authorized but unissued
shares of Common Stock to such number of shares as shall be sufficient for such
purposes. The Company agrees that its issuance of this Warrant shall constitute
full authority to its officers who are charged with the duty of executing stock
certificates to execute and issue the necessary certificates for shares of
Common Stock upon the exercise of this Warrant. 

 

6.  Exercise
of Warrant. (a)
Subject to the terms and conditions hereof, this Warrant may be exercised by the
holder hereof then registered on the books of the Company at any time from the
date of issuance and before the expiration date (set forth above). Subject to
the foregoing, this Warrant may be exercised by the Holder or its registered
assigns, in whole or in part and in minimum units of 100,000 shares, by the
surrender of this Warrant at the principal office of the Company, together with
the attached form of subscription agreement duly executed, accompanied by
payment in full of the amount of the Warrant Price in the form described in this
Warrant. Upon partial exercise of this Warrant, a new warrant or warrants
containing the same date and provisions as this Warrant shall be issued by the
Company to the registered holder for the number of shares of Common Stock with
respect to which this Warrant shall not have been exercised. A Warrant shall be
deemed to have been exercised immediately prior to the close of business on the
date of its surrender for exercise as provided above, and the person entitled to
receive the shares of Common Stock issuable upon such exercise shall be treated
for all purposes as the holder of such shares of record as of the close of
business on such date. As promptly as practicable on or after such date, the
Company shall issue and deliver to the person or persons entitled to receive the
shares, a certificate or certificates for the number of full shares of Common
Stock issuable upon such exercise, together with cash in lieu of any fraction of
a share as provided above.

 

7.  Certificate
of Adjustment.
Whenever the Warrant Price is adjusted as provided in Section 2, the Company
shall promptly deliver to the record holder of this Warrant a certificate of an
officer of the Company setting forth the relevant Warrant Price or number of
shares after such adjustment and setting forth a brief statement of the facts
requiring such adjustment. 

 

8.  Compliance
With Securities Act. The
Holder, by acceptance of this Warrant, agrees that this Warrant and the Shares
(or shares of any security into which such Common Stock may be converted) are
being acquired for investment and that the Holder will not offer, sell, or
otherwise dispose of this Warrant or any Shares (or shares of any security into
which such Common Stock may be converted) except under circumstances which will
not result in a violation of the Securities Act of 1933, as amended (the
"Securities
Act"). Upon
exercise of this Warrant, the holder hereof shall, if requested by the Company,
confirm in writing its investment purpose and acceptance of the restrictions on
transfer of the Shares. 

 

-3-

 

9.  Registration
Rights. The
Shares issuable upon exercise of this Warrant are the subject of registration
rights under that certain Warrant Purchase Agreement between the Company and the
Holder of even date herewith (the "Warrant Purchase Agreement").

 

10.  Subdivision
of Warrant. At the
request of the holder of this Warrant in connection with a transfer or exercise
of a portion of the Warrant and upon surrender of this Warrant for such purpose
to the Company, the Company at its expense (except for any transfer tax payable)
will issue in exchange therefor warrants of like tenor and date representing in
the aggregate the right to purchase such number of shares of such Common Stock
as shall be designated by such holder at the time of such surrender; provided,
however, that the Company's obligations to subdivide securities under this
Section shall be subject to and conditioned upon the compliance of any such
subdivision with applicable state securities laws and with the Securities Act.

 

11.  Loss,
Theft, Destruction, or Mutilation of Warrant. Upon
receipt by the Company of evidence reasonably satisfactory to it of the loss,
theft, destruction, or mutilation of this Warrant, and in the case of loss,
theft, or destruction, of indemnity or security reasonably satisfactory to it
and reimbursement to the Company of all reasonable expenses incidental thereto,
in the case of mutilation, and upon surrender and cancellation of this Warrant
the Company will make and deliver a new Warrant of like tenor and dates as of
such cancellation, in lieu of this Warrant. 

 

12.  Miscellaneous. This
Warrant shall be governed by the laws of the State of Texas. The headings in
this Warrant are for purposes of convenience and reference only, and shall not
be deemed to constitute a part of this Warrant. Neither this Warrant nor any
term included may be changed, waived, discharged, or terminated orally but only
by an instrument in writing signed by the Company and the Holder. All notices
and other communications from the Company to the Holder shall be by telecopy or
expedited courier service to the address furnished to the Company in writing by
the last holder of this Warrant who shall have furnished an address to the
Company in writing.

 

[THE
REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

 

-4-

 

13.  Repurchase
Right. The Warrants that are evidenced by this Warrant are subject to repurchase
by the Company pursuant to the terms of the Warrant Purchase Agreement (the
"Warrant Purchase Agreement").

 

14.  Exercise
Period. The
Exercise Period shall mean the period commencing on the date hereof and ending
on the later of (i) August 31, 2005, or (ii) the date on which a registration
statement filed pursuant to Section 5 of the Warrant Purchase Agreement
permitting
a sale of the Shares shall have become effective and shall have remained
effective for a period of six months.

 

ISSUED
this ___ day of April, 2005. 

	 	 	 
	 	
      POSITRON
      CORPORATION

	 
 	 
 	 
 
		By:  	/s/ 
	 	
      

      Gary H. Brooks, President
	 	Title 

 

[Seal]

 

-5-

 

SUBSCRIPTION
AGREEMENT

 

__________,
200__

 

To:
Positron Corporation

 

Subject
to the terms and conditions contained in the attached Warrant, the undersigned
hereby irrevocably elects to purchase _________________ shares of Common Stock
of Positron Corporation pursuant to the provisions of Section 6 of the
attached Warrant. 

 

Enclosed
with this Subscription Agreement is payment of the purchase price by certified
check for such shares in full.

 

Please
issue a certificate or certificates representing said shares of Common Stock in
the name of the undersigned or in such other name as is specified below.

 

	 	 	 
	 	 	 
	 	 	 
	 	(Signature)	 

 

Please
issue a new Warrant for the unexercised portion of the attached Warrant in the
name of the undersigned or in such other name as is specified below:

 

	 	 	 
	 	(Signature)	 
	 	 	 
	 		 
	 	(Address) 	 
	 	 	 
	 	 	 

 

 

-6-

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