Document:

Exhibit 10.2

 

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND
MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED UNLESS SO REGISTERED OR AN EXEMPTION
FROM REGISTRATION UNDER SAID ACT IS AVAILABLE.

 

AVAX TECHNOLOGIES, INC.

 

5% Convertible Note Due May 17, 2004

 

	
  $            ,000.00

  	
   

  	
  Overland Park, Kansas

  
	
   

  	
   

  	
                                ,
  2003

  

 

AVAX
TECHNOLOGIES, INC., a Delaware corporation (the “Company”), for value received,
promises to pay to
                                                                    
or registered assigns, the principal sum of
                                           
and 00/100 Dollars ($          ,000.00)
on May 17, 2004, and interest (computed on the basis of a 365-day year) from
the date hereof on the unpaid principal amount from time to time outstanding at
the rate of five percent (5%) per annum, due and payable in arrears on the
maturity date hereof, unless payment is required at an earlier date pursuant to
the terms hereof.  This Note is one of a
series of similar Notes issued by the Company in the aggregate principal amount
not to exceed $1,000,000.

 

1.             Conversion.

 

(a)           Mandatory
Conversion.  This Note shall
automatically convert into the securities described below and at the conversion
ratios described below upon the closing of the Offering (as defined in Section 1(b)) if the closing of the
Offering occurs on or prior to the maturity date of this Note.  Upon the closing of the Offering, all
principal of and accrued and unpaid interest on this Note will automatically
convert, at the election of the holder of this Note, into either (i) 7.692
shares of Common Stock, $.004 par value per share, of the Company (“Common
Stock”) for each $1.00 of unpaid principal of and interest on this Note on the
conversion date, or (ii) into that number of securities issued by the Company
in the Offering equal to the quotient obtained by dividing the principal and
accrued interest owed hereunder on the conversion date by the price at which
the securities are issued in the Offering and on the same terms and conditions
and with the same rights and preferences as the securities issued in the
Offering.  To exercise this election as
to the form and amount of securities to be received upon conversion of this
Note, the holder of this Note shall deliver to the Company during usual
business hours at the Company’s principal executive office written notice in
form satisfactory to the Company that the holder elects to receive the
conversion securities specified in either clause (i) or clause (ii) above.  Such notice shall also state the name or
names (with address) in which the certificate or certificates for shares (or
other securities) that are issuable on such conversion are to be registered.

 

(b)           Offering
of Securities.  In accordance
with Section 7.5 of the Note
Purchase Agreement dated the date hereof, the Company will use its reasonable
efforts to close an offering of securities on or before May 17, 2004, in which
the gross proceeds to the Company are not less than $1,000,000 (the “Offering”).  Upon the closing of the Offering, the Note
will automatically convert into either (i) shares of Common Stock, or (ii) the
securities issued in the Offering, in accordance with Section 1(a).

 

(c)           Surrender
of Note and Delivery of Certificates. 
When surrendered for automatic conversion this Note shall, unless the
shares (or other securities) issuable on conversion are to be issued in the
same name as the name in which this Note is then registered, be duly endorsed
by, or accompanied by instruments of transfer in form satisfactory to the
Company duly executed by, the holder or his or its duly authorized
attorney.  As promptly as practicable
after the surrender of this Note for conversion and the

 

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receipt of the notice specified
above, the Company shall deliver or cause to be delivered to the holder, or on
the holder’s written order, a certificate or certificates for the number of
full shares (or other securities) issuable upon the conversion of this Note, in
accordance with the provisions hereof. 
Such conversion shall be deemed to have been made automatically on the
closing of the Offering, and from and after such time, the holder of this Note
will have no rights hereunder other than the right to receive the conversion
shares (or other securities) and the holder in whose name any certificate or
certificates for shares of shall be issuable upon such conversion shall be
deemed to have become on the Conversion Date the holder of record of the shares
represented thereby.

 

2.             Adjustment of
Conversion Price.

 

(a)           Stock
Dividends, Stock Splits, etc. 
If the Company:

 

(i)            declares a dividend of Common Stock on its
Common Stock,

 

(ii)           subdivides its outstanding Common Stock into
a larger number of shares of Common Stock by reclassification, stock split or
otherwise, or

 

(iii)          combines its outstanding Common Stock into a
smaller number of shares of Common Stock by reclassification, reverse stock
split or otherwise,

 

the number of shares of Common Stock issuable upon conversion of this
Note pursuant to clause (i) of Section 1
immediately prior to any such event shall be adjusted proportionately so that
thereafter the holder of this Note shall be entitled to receive upon conversion
of this Note the number of shares of Common Stock which such holder would have
owned after the happening of any of the events described above had this Note
been converted immediately prior to the happening of such event, provided that
the Conversion Price shall in no event be reduced to less than the par value of
the shares issuable upon conversion.  An
adjustment made pursuant to this Section 2
will become effective immediately after the record date in the case of a
dividend and will become effective immediately after the effective date in the
case of a subdivision or combination.

 

(b)           Merger
or Consolidation.  If, prior to
maturity of this Note, the Company at any time consolidates or merges with
another corporation (other than a merger or consolidation in which the Company
is the surviving corporation), the holder hereof will thereafter be entitled to
receive, upon the conversion hereof, the securities or property to which a
holder of the number of shares of Common Stock then deliverable upon the
conversion hereof would have been entitled upon such consolidation or merger,
and the Company shall take such steps in connection with such consolidation or
merger as may be necessary to ensure that the provisions hereof shall
thereafter be applicable, as nearly as reasonably may be, in relation to any
securities or property thereafter deliverable upon the conversion of this Note.

 

(c)           Notice.  If the Company proposes to take any action
referred to in this Section 2,
or to effect the liquidation, dissolution or winding up of the Company, then
the Company shall cause notice thereof to be mailed to the record holder of
this Note at least ten (10) days prior to the record date or effective date, as
applicable, of the stock dividend, merger, consolidation or other event subject
to this Section.

 

(d)           Statement
of Adjustment.  Whenever the
conversion price is adjusted as provided in Section 2(a),
the Company shall promptly file at the Company’s principal executive office, a
statement, signed by the Chairman of the Board, the President or any Vice
President of the Company, showing in reasonable detail the facts requiring such
adjustment and the conversion price that will be effective after such
adjustment.  The Company shall also
cause a notice setting forth any such adjustment to be sent by

 

2

 

mail, first class, postage
prepaid, to each record holder of this Note. 
Where appropriate, such notice may be given in advance and may be
included as part of a notice required to be mailed under the provisions of Section 2(c).

 

(e)           Fractional
Shares.  No fractional shares of
Common Stock will be issued upon conversion of this Note, but a payment in cash
will be made in respect of any fraction of a share which would otherwise be
issuable upon the conversion of this Note. 
Such payment shall be based on the fair market value of the Common Stock
at the time of conversion of this Note.

 

(f)            Securities
Act of 1933.  Upon conversion of
this Note, the record holder may be required to execute and deliver to the
Company an instrument, in form satisfactory to the Company, representing that
the shares (or other securities) issuable upon conversion hereof are being
acquired for investment only and not with a view to distribution within the
meaning of the Securities Act of 1933, as amended.

 

3.             Prepayment of
Principal.  The principal amount of
this Note may NOT be prepaid in whole or in part, without the prior written
consent of the holder of this Note.

 

4.             Default.

 

The entire
unpaid principal of this Note and the interest then accrued on this Note shall
become and be immediately due and payable upon written demand of the holder of
this Note, without any other notice or demand of any kind or any presentment or
protest, if any one of the following events occurs and be continuing at the time
of such demand:

 

(a)           If the Offering has not
closed on or before the maturity date hereof an the Company fails to pay the
principal amount of and all accrued interest on this Note on the maturity date
hereof; or

 

(b)           If the Company defaults
in the performance of any other obligation under this Note or the Note Purchase
Agreement, and such default continues for twenty (20) days after notice thereof
by the holder hereof to the Company; or

 

(c)           If the stockholders of
the Company fail to approve on or before December 31, 2003, either (i) an
increase in the authorized Common Stock or (ii) a reverse stock split of the
Common Stock; or

 

(d)           If the Company
(i) makes an assignment for the benefit of creditors, (ii) applies
for, consents to, acquiesces in, files a petition seeking or admits (by answer,
default or otherwise) the material allegations of a petition filed against it
seeking the appointment of a trustee, receiver or liquidator, in bankruptcy or
otherwise, of itself or of all or a substantial portion of its assets, or a
reorganization, arrangement with creditors or other remedy, relief or
adjudication available to or against a bankrupt, insolvent or debtor under any
bankruptcy or insolvency law or any law affecting the rights of creditors
generally, or (iii) admits in writing its inability to pay its debts
generally as they become due; or

 

(e)           If an order for relief
shall have been entered by a bankruptcy court or if a decree, order or judgment
shall have been entered adjudging the Company insolvent, or appointing a
receiver, liquidator, custodian or trustee, in bankruptcy or otherwise, for it
or for all or a substantial portion of its assets, or approving the winding-up
or liquidation of its affairs on the grounds of insolvency or nonpayment of
debts, and such order for relief, decree, order or judgment shall remain
undischarged or unstayed for a period of sixty (60) days; or

 

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(f)            If any substantial
part of the property of the Company is sequestered or attached and is not
returned to the possession of the Company or released from such attachment
within sixty (60) days.

 

5.             General.

 

(a)           Successors
and Assigns.  This Note, and the
obligations and rights of the Company hereunder, shall be binding upon and
inure to the benefit of the Company, the holder of this Note, and their
respective successors and assigns.

 

(b)           Recourse.  Recourse under this Note is to the general
unsecured assets of the Company only and in no event to the officers, directors
or stockholders of the Company.

 

(c)           Changes.  Changes in or additions to this Note may be
made or compliance with any term, covenant, agreement, condition or provision
set forth herein may be omitted or waived (either generally or in a particular
instance and either retroactively or prospectively), upon written consent of
the Company and the holder of this Note.

 

(d)           Currency.  All payments shall be made in such coin or
currency of the United States of America as at the time of payment is legal
tender therein for the payment of public and private debts.

 

(e)           Saturdays,
Sundays, Holidays.  If any date
specified in this Note as a date for the making of any payment of principal or
interest under this Note falls on a Saturday, Sunday or on a day that is a
legal holiday in the State of Pennsylvania, then the date for the making of
that payment shall be the next subsequent day that is not a Saturday, Sunday or
legal holiday.

 

(f)            Governing
Law.  This Note shall be
construed and enforced in accordance with, and the rights of the parties shall
be governed by, the laws of the State of Delaware.

 

IN WITNESS WHEREOF,
this Note has been executed and delivered on the date first above written by
the duly authorized representative of the Company.

 

	
   

  	
  AVAX TECHNOLOGIES, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
  Richard P. Rainey

  
	
   

  	
  Title:

  	
  President

  

 

4Exhibit 10.3

 

THE WARRANT REPRESENTED BY THIS
CERTIFICATE AND THE SECURITIES ISSUABLE UPON EXERCISE THEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF ANY
STATE.  NEITHER THE WARRANT NOR SUCH
SECURITIES MAY BE SOLD, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED WITHOUT
SUCH REGISTRATION, EXCEPT UPON DELIVERY TO THE COMPANY OF SUCH EVIDENCE AS MAY
BE SATISFACTORY TO COUNSEL FOR THE COMPANY TO THE EFFECT THAT ANY SUCH TRANSFER
IS NOT IN VIOLATION OF THE SECURITIES ACT OF 1933 OR APPLICABLE STATE
SECURITIES LAWS OR ANY RULE OR REGULATION PROMULGATED THEREUNDER.

 

 

AVAX
TECHNOLOGIES, INC.

 

 

Warrant for the
Purchase

of Shares of Common Stock

 

	
                         ,
  2003

  	
   

  	
  Delaware, U.S.A.

  

 

 

Holder:
                                                                     

 

Holder’s Address:                                                    

 

                                                                                  

 

                                                                                  

 

FOR VALUE RECEIVED,
AVAX TECHNOLOGIES, INC., a Delaware corporation (the “Company”), hereby certifies
that the above-named holder (the “Holder”), its designee or its permitted
assigns is entitled to purchase from the Company, at any time or from time to
time commencing on the date hereof and prior to 5:00 P.M., New York City time,
on  November 17,
2008,  up to
                                                
(                )
fully paid and non-assessable shares of common stock (subject to adjustment),
$.004 par value per share, of the Company for $0.143 per share (subject to
adjustment) at an aggregate purchase price of
$                        .  This Warrant, all similar Warrants issued by
the Company in November 2003 pursuant to the Note Purchase Agreement dated as
of November 17, 2003, and all Warrants hereafter issued in exchange or
substitution for this Warrant or similar Warrants are referred to as the “Warrants;”
common stock, $.004 par value per share, of the Company, is referred to as the
“Common
Stock;” the shares of the Common Stock purchasable hereunder are
referred to as the “Warrant Shares;” the aggregate purchase
price payable for the Warrant Shares purchasable hereunder is referred to as
the “Aggregate
Warrant Price;” the price payable (initially $0.143 per share,
subject to adjustment) for each of the Warrant Shares is referred to as the “Per Share
Warrant Price;” and the holder of this Warrant is referred to as the
“Holder.”  The Aggregate Warrant Price is not subject
to adjustment.

 

1.                                      Exercise
of Warrant.  (a) This Warrant
may be exercised in whole at any time, or in part from time to time, commencing
on the date hereof and prior to 5:00 P.M., New York City time, on

 

1

 

November 17, 2008, by the
Holder by the surrender of this Warrant (with the subscription form at the end
hereof duly executed) at the address set forth in Section 9(a), together with
proper payment of the Aggregate Warrant Price, or the proportionate part
thereof if this Warrant is exercised in part, with payment for the Warrant
Shares made by certified or official bank check payable to the order of the
Company.

 

(b)                                 If this Warrant is exercised in part,
this Warrant must be exercised for a number of whole shares of the Common
Stock, and the Holder is entitled to receive a new Warrant covering the Warrant
Shares that have not been exercised and setting forth the proportionate part of
the Aggregate Warrant Price applicable to such Warrant Shares.

 

(c)                                  Upon surrender of this Warrant, the
Company will (i) issue a certificate or certificates in the name of the Holder
for the number of whole shares of the Common Stock to which the Holder is
entitled and, if this Warrant is exercised in whole, in lieu of any fractional
share of the Common Stock to which the Holder may be entitled, pay to the
Holder cash in an amount equal to the fair value of the fractional share
(determined in such reasonable manner as the Board of Directors of the Company
determines), and (ii) to the extent applicable, deliver the other securities
and properties receivable upon the exercise of this Warrant, or the
proportionate part thereof if this Warrant is exercised in part, pursuant to
the provisions of this Warrant.

 

2.                                      Reservation
of Warrant Shares; Listing.  The
Company agrees that, prior to the expiration of this Warrant, the Company shall
at all times (i) have authorized and in reserve, and shall keep available,
solely for issuance and delivery upon the exercise of this Warrant, the shares
of the Common Stock and other securities and properties as from time to time
shall be receivable upon the exercise of this Warrant, free and clear of all
restrictions on sale or transfer, other than under Federal or state securities
laws, and free and clear of all preemptive rights and rights of first refusal
and (ii) use its best efforts to keep the Warrant Shares authorized for listing
on the Nasdaq National Market, the Nasdaq SmallCap Market or any national
securities exchange on which the Company’s Common Stock is traded.

 

3.                                      Protection
Against Dilution.  (a)  If the Company hereafter (i) pays a dividend
or makes a distribution on its Common Stock in shares of Common Stock, (ii)
subdivides its outstanding shares of Common Stock into a greater number of
shares, (iii) combines its outstanding shares of Common Stock into a smaller
number of shares or (iv) issues by reclassification of its Common Stock any
shares of capital stock of the Company, then (x) the Per Share Warrant Price
(but not the Aggregate Warrant Price) and (y) the number of Warrant Shares
issuable hereunder (collectively the “Exercise Terms”) shall be adjusted so that
the Holder upon the exercise hereof will be entitled to receive the number of
shares of Common Stock or other capital stock of the Company that the Holder
would have owned immediately following such action had the Warrant been
exercised immediately prior thereto.  An
adjustment made pursuant to this Section 3(a) will become effective
immediately after the record date in the case of a dividend or distribution and
will become effective immediately after the effective date in the case of a
subdivision, combination or reclassification. 
If the Board of Directors of the Company declares any dividend or
distribution or resolve to take any action referred to in this Section 3(a),
it shall provide written notice thereof to the Holders not less than 10 days
prior to the record date fixed for determining the stockholders entitled to
participate therein.

 

(b)                                 In the case of any capital reorganization
or reclassification, or any consolidation or merger to which the Company is a
party, other than a merger or consolidation in which the Company is the
continuing corporation, or in the case of any sale or conveyance to another
entity of the property of the Company as an entirety or substantially as an
entirety, or in the case of any statutory exchange of

 

2

 

securities with
another corporation (including any exchange effected in connection with a
merger of a third corporation into the Company), the Holder will have the right
thereafter to receive on the exercise of the Warrant the kind and amount of
securities, cash or other property that the Holder would have owned or have
been entitled to receive immediately after such reorganization,
reclassification, consolidation, merger, statutory exchange, sale or conveyance
had the Warrant been exercised immediately prior to the effective date of the
reorganization, reclassification consolidation, merger, statutory exchange,
sale or conveyance and in any such case, if necessary, appropriate adjustment
shall be made in the application of the provisions set forth in this Section 3
with respect to the rights and interests thereafter of the Holder to the end that
the provisions set forth in this Section 3 shall thereafter correspondingly
be made applicable, as nearly as may reasonably be, in relation to any shares
of stock or other securities thereafter deliverable on the exercise of the
Warrant.  Notice of any such
reorganization, reclassification, consolidation, merger, exchange, sale or
conveyance shall be mailed to the Holders not less than 30 days prior to such
event.  The above provisions of this Section 3(b)
shall similarly apply to successive reorganizations, reclassifications,
consolidations, mergers, statutory exchanges, sales or conveyances.  The Company shall require the issuer of any
shares of stock or other securities or property thereafter deliverable on the
exercise of the Warrants to be responsible for all of the agreements and
obligations of the Company hereunder.

 

(c)                                  If
the Company issues rights, options, warrants or convertible securities to all
holders of its Common Stock, without any charge to or consideration from such
holders, entitling them to subscribe for or purchase Common Stock at a price
per share that is lower at the record date mentioned below than the closing bid
price (as defined below) for the trading day immediately prior to such record
date (the “Current
Market Price”), then the Per Share Warrant Price shall be determined
by multiplying the Per Share Warrant Price then in effect by a fraction, of
which the numerator is the number of shares of Common Stock outstanding
immediately prior to the issuance of such rights, options, warrants or
convertible securities plus the number of additional shares of Common Stock
offered for subscription or purchase, and of which the denominator is the
number of shares of Common Stock outstanding immediately prior to the issuance
of such rights, options, warrants or convertible securities plus the number of
shares which the aggregate offering price of the total number of shares offered
would purchase at such Current Market Price. 
Such adjustment shall be made whenever such rights, options, warrants or
convertible securities are issued, and shall become effective immediately and
retroactive to the record date for the determination of stockholders entitled
to receive such rights, options, warrants or convertible securities.

 

The “closing
bid price” for each trading day shall be the reported closing bid price on the
NASDAQ SmallCap Market or the NASDAQ National Market System (“NMS”) (such
markets are collectively referred to as “NASDAQ”) or, if the Common Stock is
not quoted on NASDAQ, on the principal national securities exchange on which
common stock is listed or admitted to trading (based on the aggregate dollar
value of all securities listed or admitted to trading) or, if not listed or
admitted to trading on any national securities exchange or quoted on NASDAQ,
the closing bid price in the over-the-counter market as furnished by any NASD
member firm selected from time to time by the Company for that purpose, or, if
such prices are not available, the fair market value set by, or in a manner
established by, the Board of Directors of the Company in good faith.  “Trading day” shall mean a day on which the
national securities exchange or NASDAQ used to determine the closing bid price
is open for the transaction of business or the reporting of trades or, if the
closing bid price is not so determined, a day on which NASDAQ is open for the
transaction of business.

 

(d)                                 If the Company distributes (other than a
distribution in liquidation of the Company) to all holders of its Common Stock,
without any charge to or consideration from such holder, evidences of its
indebtedness or assets (excluding cash dividends or distributions out of
earnings), then in each case the Company shall simultaneously distribute such
evidences of its indebtedness or assets pro rata to the

 

3

 

Holders of
Warrants on the record date or date of effectiveness, as the case may be, fixed
for determining the holders of Common Stock entitled to participate in such
distribution in an amount equal to the amount that such Holders would have been
entitled to receive had their Warrants been exercised for shares of Common
Stock immediately prior to the time for determination of the holders of Common
Stock entitled to participate in that distribution.

 

(e)                                  No adjustments in the Exercise Terms
shall be required:

 

(i)                                     Unless such adjustment would require an
increase or decrease of at least $0.01 per share of Common Stock; provided,
however, that any adjustments that by reason of this Section
3(e)(i) are not required to be made shall be carried forward and
cumulated with amounts in any subsequent adjustment, and provided, further,
however, that adjustments shall be required and made in accordance with
the provisions of this Section 3 (other than this Section 3(e)(i))
not later than such time as may be required in order to preserve the tax-free
nature of a distribution to the Holder of this Warrant or Common Stock issuable
upon the exercise hereof.  All
calculations that shall be required pursuant to this Section 3 shall be made to
the nearest cent or to the nearest one-hundredth of a share, as the case may
be.  Anything in this Section 3
to the contrary notwithstanding, the Company shall be entitled to make such
adjustments to the Exercise Terms, in addition to those required by this Section 3
as it in its discretion shall deem to be advisable in order that any stock
dividend, subdivision of shares or distribution of rights to purchase stock or
securities convertible or exchangeable for stock hereafter made by the Company
to its stockholders is not taxable.

 

(ii)                                  If the Company issues
shares of Common Stock pursuant to (a) the exercise of any warrants (or
warrants or options to acquire any shares of convertible preferred stock) of
the Company outstanding on the date hereof, (b) the exercise of the Warrants,
or a portion thereof, (c) the conversion of shares of any series of convertible
preferred stock of the Company outstanding on the date hereof or (d) the
exercise of any stock options or warrants currently outstanding or issued after
the date hereof pursuant to any Company benefit plan or compensation
arrangement.

 

(f)                                    Whenever
the conversion rate is adjusted as provided in any provision of this Section 3:

 

(i)                                     the Company shall compute the adjusted
Exercise Terms in accordance with this Section 3 and shall prepare a certificate
signed by the principal financial officer of the Company setting forth the
adjusted conversion rate and showing in reasonable detail the facts upon which
such adjustment is based, and such certificate shall forthwith be filed with
the registrar of the Warrant; and

 

(ii)                                  the Company shall mail as soon as
practicable after an adjustment is required a notice stating that the Exercise
Terms have been adjusted and setting forth the adjusted Exercise Terms to all
record Holders of this Warrant at its address as it appears in the records of
the Company.

 

4.                                      Fully
Paid Stock; Taxes.  The shares
of the Common Stock represented by each certificate for Warrant Shares
delivered on the exercise of this Warrant shall at the time of such delivery,
be duly authorized, validly issued and outstanding, fully paid and
nonassessable, and not subject to preemptive rights or rights of first refusal,
and the Company will take all such actions as may be necessary to assure that
the par value, if any, per share of the Common Stock is at all times equal to
or less than the then Per Share Warrant Price. 
The Company shall pay all documentary, stamp or similar taxes and other
similar governmental charges that may be imposed with respect to the issuance
or delivery of any shares of Common Stock upon exercise of the Warrant (other
than income taxes); provided, however, that if the shares of Common Stock are
to be delivered in a name other than the name of the

 

4

 

Holder, no such delivery shall
be made unless the person requesting the same has paid to the Company the
amount of transfer taxes or charges incident thereto, if any.

 

5.                                      Registration
Under Securities Act of 1933. 
The Holder shall have the right to participate in the registration
rights described in the Note Purchase Agreement dated as of
November       , 2003 hereto.  By acceptance of this Warrant, the Holder
agrees to comply with the registration right provisions of the Note Purchase
Agreement to the same extent as if it were a party thereto.

 

6.                                      Investment
Intent; Limited Transferability. 
(a) The Holder represents, by accepting this Warrant, that it
understands that this Warrant and any securities obtainable upon exercise of
this Warrant have not been registered for sale under Federal or state
securities laws and are being offered and sold to the Holder pursuant to one or
more exemptions from the registration requirements of such securities laws.  In the absence of an effective registration
of such securities or an exemption therefrom, any certificates for such
securities shall bear the legend set forth on the first page hereof.  The Holder understands that it must bear the
economic risk of its investment in this Warrant and any securities obtainable
upon exercise of this Warrant for an indefinite period of time, as this Warrant
and such securities have not been registered under Federal or state securities
laws and therefore cannot be sold unless subsequently registered under such
laws, unless an exemption from such registration is available.

 

(b)                                 The
Holder, by its acceptance of this Warrant, represents to the Company that it is
acquiring this Warrant and will acquire any securities obtainable upon exercise
of this Warrant for its own account, or for the account of its customers, each
of whom is an “accredited investor,” for investment and not with a view to, or
for sale in connection with, any distribution thereof in violation of the Act.  The Holder agrees that this Warrant and any
such securities will not be sold or otherwise transferred unless (i) a
registration statement with respect to such transfer is effective under the Act
and any applicable state securities laws or (ii) such sale or transfer is made
pursuant to one or more exemptions from the Act.

 

(c)                                  This
Warrant may not be sold, transferred, assigned or hypothecated by the Holder
except in compliance with the provisions of the Act and the applicable state
securities “blue sky” laws, and is transferable only upon the books of the
Company, which it shall cause to be maintained for such purpose.  The Company may treat the registered Holder
of this Warrant as he, she or it appears on the Company’s books at any time as
the Holder for all purposes.  The
Company shall permit any Holder of a Warrant or his duly authorized attorney,
upon written request during ordinary business hours, to inspect and copy or
make extracts from its books showing the registered holders of Warrants.  All Warrants issued upon the transfer or assignment
of this Warrant will be dated the same date as this Warrant, and all rights of
the holder thereof shall be identical to those of the Holder.

 

7.                                      Loss,
etc., of Warrant.  Upon receipt
of evidence satisfactory to the Company of the loss, theft, destruction or
mutilation of this Warrant, and of indemnity reasonably satisfactory to the
Company, if lost, stolen or destroyed, and upon surrender and cancellation of
this Warrant, if mutilated, the Company shall execute and deliver to the Holder
a new Warrant of like date, tenor and denomination.

 

8.                                      Warrant
Holder Not Stockholder.  This
Warrant does not confer upon the Holder any right to vote on or consent to or
receive notice as a stockholder of the Company, as such, in respect of any
matters whatsoever, nor any other rights or liabilities as a stockholder, prior
to the exercise hereof; this Warrant does, however, require certain notices to
Holders as set forth herein.

 

9.                                      Communication.  Any notice or other communication shall be
effective and shall be deemed to have been given if, the same is in writing and
is mailed by first-class mail, postage prepaid, addressed to:

 

5

 

(a)                                  the
Company at AVAX Technologies, Inc., 9200 Indian Creek Parkway, Suite 200, Overland
Park, Kansas 66210, Attn:  President, or
such other address as the Company has designated in writing to the Holder, or

 

(b)                                 the
Holder at the address set forth on the cover page of this Warrant, or such
other address as the Holder has designated in writing to the Company.

 

10.                               Headings.  The headings of this Warrant have been
inserted as a matter of convenience and shall not affect the construction
hereof.

 

11.                               Applicable
Law.  This Warrant shall be
governed by and construed in accordance with the laws of the State of Delaware
without giving effect to the principles of conflicts of law thereof.

 

12.                               Amendment,
Waiver, etc.  Except as
expressly provided herein, neither this Warrant nor any term hereof may be
amended, waived, discharged or terminated other than by a written instrument
signed by the party against whom enforcement of any such amendment, waiver,
discharge or termination is sought; provided, however, that any provisions
hereof may be amended, waived, discharged or terminated upon the written
consent of the Company and the Holder.

IN WITNESS WHEREOF,
the Company has caused this Warrant to be signed by its President as of the
date first above written.

 

	
   

  	
   

  	
   

  	
  AVAX TECHNOLOGIES,
  INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Richard P. Rainey

  
	
   

  	
   

  	
   

  	
  Title:

  	
  President

  
							

 

6

 

EXERCISE
OF WARRANT

 

The
undersigned,
                                  ,
pursuant to the provisions of the foregoing Warrant, hereby elects to purchase
                                      
shares of the Common Stock, par value $.004 per share, of AVAX Technologies,
Inc. covered by said Warrant, and makes payment therefor in full at the Per
Share Warrant Price provided in the Warrant.

 

	
  Dated:

  	
   

  	
   

  	
  Signature:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address:

  	
   

  	
   

  
							

 

ASSIGNMENT

 

FOR VALUE RECEIVED,
                                  
hereby sells, assigns and transfers unto                                   
the foregoing Warrant and all rights evidenced thereby, and does irrevocably
constitute and appoint
                                      ,
attorney, to transfer said Warrant on the books of AVAX Technologies, Inc.

 

	
  Dated:

  	
   

  	
   

  	
   

  	
  Signature:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Address:

  	
   

  	
   

  
								

 

PARTIAL
ASSIGNMENT

 

FOR VALUE RECEIVED,
                                 
hereby assigns and transfers unto                                  
the right to purchase
              
shares of Common Stock, par value $.004 per share, of AVAX Technologies, Inc.
covered by the foregoing Warrant, and a proportionate part of said Warrant and
the rights evidenced thereby, and does irrevocably constitute and appoint
                                    ,
attorney, to transfer such part of said Warrant on the books of the Company.

 

	
  Dated:

  	
   

  	
   

  	
   

  	
  Signature:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Address:

  	
   

  	
   

  
								

 

7

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