Document:

COMMON
      STOCK PURCHASE

    

    WARRANT

    

    THE
      SECURITIES REPRESENTED BY THIS CERTIFICATE, THE COMMON STOCK ISSUABLE UPON
      EXERCISE HEREOF, AND ANY INTEREST THEREIN MAY NOT BE OFFERED OR SOLD EXCEPT
      PURSUANT TO (i) A REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933,
      AS
      AMENDED, OR (ii) AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT.

    

    THE
      TRANSFER OF THIS WARRANT

    IS
      RESTRICTED AS DESCRIBED HEREIN

    

    VOID
      AFTER 5:00 P.M., NEW YORK TIME,

    ON
      JUNE
      19, 2007

    

    HEALTH-CHEM
      CORPORATION

    

    Warrant
      for the Purchase

    of

    712,500
      Shares of Common Stock

    

    No.
      

    

    THIS
      CERTIFIES that, for value received, Lazar & Company IG LLC (the "Holder") is
      entitled to subscribe for and purchase from Health-Chem Corporation, a Delaware
      corporation (the "Company"), upon the terms and subject to the conditions set
      forth herein, at any time or from time to time, on or after June 19, 2002,
      and
      before 5:00 P.M., New York time, on June 19, 2007 (the "Exercise Period"),
      seven
      hundred twelve thousand five hundred (712,500) shares of the Company's Common
      Stock, par value $.01 per share (the "Common Stock"), subject to adjustment
      as
      provided herein (the "Warrant Shares"), at a price of $ .125 per share, subject
      to adjustment as provided herein (the "Exercise Price").

    

    This
      Warrant may not be sold or otherwise disposed of without the Company's prior
      written consent. No transfer of this Warrant or the Warrant Shares will be
      permitted unless a registration statement under the Securities Act of 1933,
      as
      amended (the "Act"), is in effect as to that transfer or, in the opinion of
      counsel reasonably satisfactory to the Company, registration under the Act
      is
      not necessary for that transfer to comply with the Act. The Company has no
      obligation, and does not intend, to register this Warrant or any Warrant Shares
      under the Act. The term the "Holder" as used herein shall include any transferee
      to whom this Warrant has been transferred in accordance with the
      above.

    

    1. This
      Warrant may be exercised during the Exercise Period, as to the whole or any
      lesser number of whole Warrant Shares, by the surrender of this Warrant (with
      the Form of Election to Exercise at the end hereof duly completed and executed)
      to the Company at 101 Sinking Springs Lane, Emigsville, Pennsylvania 17318,
      Attn: Andy E. Yurowitz, Chairman, or at such other place as may be designated
      in
      writing by the Company, together with a certified or bank cashier's check
      payable to the order of the Company, or by the Holder’s causing the
      contemporaneous wire transfer of funds to an account designated by the Company,
      in an amount equal to the Exercise Price multiplied by the number of Warrant
      Shares for which this Warrant is being exercised. Notwithstanding the foregoing,
      at any time that there exists an established trading market for the Common
      Stock, the Holder may elect to cause the cashless exercise of this Warrant,
      in
      which case the Holder shall be entitled to receive a certificate for the number
      of Warrant Shares equal to the product of (I) the quotient obtained by dividing
      (A) (i) the closing price per share for the Common Stock on the principal market
      on which it trades on the trading day preceding the date of delivery of the
      Form
      of Election to Exercise the Warrant to the Company, or if no such closing price
      is available, the average of the closing bid and asked prices on such date,
      or,
      if no such prices are available for such date, on the next preceding trading
      date for which such a closing sale price or, failing that, closing bid and
      asked
      prices may be found (the “Market Price”) minus (ii) the Exercise Price then in
      effect, by (B) the Market Price, multiplied by (II) the number of Warrant Shares
      issuable upon exercise of the Warrant in accordance with its terms without
      regard to this sentence.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    2. Upon
      each
      exercise of the Holder's rights to purchase Warrant Shares, the Holder shall
      be
      deemed to be the holder of record of the Warrant Shares issuable upon such
      exercise, notwithstanding that the transfer books of the Company shall then
      be
      closed or certificates representing such Warrant Shares shall not then have
      been
      actually delivered to the Holder. As soon as practicable after each such
      exercise of this Warrant, the Company shall issue and deliver to the Holder
      a
      certificate or certificates for the Warrant Shares issuable upon such exercise,
      registered in the name of the Holder. If this Warrant should be exercised in
      part only, the Company shall, upon surrender of this Warrant for cancellation,
      execute and deliver a new Warrant evidencing the right of the Holder to purchase
      the balance of the Warrant Shares (or portions thereof) subject to purchase
      hereunder.

    

    3. Any
      Warrants issued upon the transfer or exercise in part of this Warrant shall
      be
      numbered and shall be registered in a warrant register (the "Warrant Register")
      as they are issued. The Company shall be entitled to treat the registered holder
      of any Warrant on the Warrant Register as the owner in fact thereof for all
      purposes and shall not be bound to recognize any equitable or other claim to
      or
      interest in such Warrant on the part of any other person, and shall not be
      liable for any registration or transfer of Warrants which are registered or
      to
      be registered in the name of a fiduciary or the nominee of a fiduciary unless
      made with the actual knowledge that a fiduciary or nominee is committing a
      breach of trust in requesting such registration or transfer, or with the
      knowledge of such facts that its participation therein amounts to bad faith.
      This Warrant shall be transferable on the books of the Company only upon
      delivery hereof with the Form of Assignment at the end hereof duly completed
      and
      executed by the Holder or by his or its duly authorized attorney or
      representative, or accompanied by proper evidence of succession, assignment,
      or
      authority to transfer. In all cases of transfer by an attorney, executor,
      administrator, guardian or other legal representative, duly authenticated
      evidence of his or its authority shall be produced. Upon any registration of
      transfer, the Company shall deliver a new Warrant or Warrants to the person
      entitled thereto. This Warrant may be exchanged, at the option of the Holder
      thereof, for another Warrant, or other Warrants of different denominations,
      of
      like tenor and representing in the aggregate the right to purchase a like number
      of Warrant Shares (or portions thereof), upon surrender to the Company or its
      duly authorized agent. Notwithstanding the foregoing, the Company shall have
      no
      obligation to cause this Warrant to be transferred on its books to any person
      if, in the opinion of counsel to the Company, such transfer does not comply
      with
      the provisions of the Act and the rules and regulations thereunder.

    

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    4. The
      Company shall at all times during the Exercise Period reserve and keep available
      out of its authorized and unissued Common Stock, solely for the purpose of
      providing for the exercise of the Warrants, such number of shares of Common
      Stock as shall, from time to time, be sufficient therefor. The Company covenants
      that all Warrant Shares, upon receipt by the Company of the full payment
      therefor, shall be validly issued, fully paid, nonassessable, and free of
      preemptive rights.

    

    5. Subject
      to the provisions of this Section 5, the Exercise Price in effect from time
      to
      time shall be subject to adjustment, as follows:

    

    (a) In
      case
      the Company shall at any time after the date the Warrants were first issued
      1. declare a dividend on the outstanding Common Stock payable in shares of
      its capital stock, 2. subdivide the outstanding Common Stock, or
      3. combine the outstanding Common Stock into a smaller number of shares,
      then, in each case, the Exercise Price in effect, and the number of shares
      of
      Common Stock issuable upon exercise of the Warrants outstanding, at the time
      of
      the record date for such dividend or of the effective date of such subdivision
      or combination, shall be proportionately adjusted so that the holders of the
      Warrants after such time shall be entitled to receive the aggregate number
      and
      kind of shares, for the same aggregate Exercise Price as in effect immediately
      prior to such dividend, subdivision or combination, which, if such Warrants
      had
      been exercised immediately prior to such time, such holders would have owned
      upon such exercise and been entitled to receive by virtue of such dividend,
      subdivision, or combination. Such adjustment shall be made successively whenever
      any event listed above shall occur.

    

    (b) All
      calculations under this Section 5 shall be made to the nearest cent or to the
      nearest one-thousandth of a share, as the case may be; provided, however that,
      no adjustment in the Exercise Price shall be required if such adjustment is
      less
      than $.02; and provided, further, that any adjustments which by reason of this
      Section 5 are not required to be made shall be carried forward and taken into
      account in any subsequent adjustment. The Company shall not be required to
      issue
      fractions of shares of Common Stock or other capital stock of the Company upon
      the exercise of this Warrant. If any fraction of a share would be issuable
      on
      the exercise of this Warrant (or specified portions thereof), the Company shall
      purchase such fraction for an amount in cash equal to the same fraction of
      the
      fair market value of such share of Common Stock on the date of exercise of
      this
      Warrant.

    

    (c) In
      any
      case in which this Section 5 shall require that an adjustment in the Exercise
      Price be made effective as of a record date for a specified event (an "Event"),
      the Company may elect to defer, until the occurrence of such Event, issuing
      to
      the Holder, if the Holder exercised this Warrant after such record date, the
      shares of Common Stock, if any, issuable upon such exercise over and above
      the
      number of Warrant Shares, if any, issuable upon such exercise on the basis
      of
      the Exercise Price in effect prior to such adjustment; provided, however, that
      the Company shall deliver to the Holder a due bill or other appropriate
      instrument evidencing the Holder's right to receive such additional shares
      upon
      the occurrence of the Event requiring such adjustment.

    

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    (d) Whenever
      there shall be an adjustment as provided in this Section 5, the Company shall
      within 15 days thereafter cause written notice thereof to be sent by registered
      mail, postage prepaid, to the Holder, at its address as it shall appear in
      the
      Warrant Register, which notice shall be accompanied by an officer's certificate
      setting forth the number of Warrant Shares issuable hereunder and the Exercise
      Price after such adjustment and setting forth a brief statement of the facts
      requiring such adjustment and the computation thereof, which officer's
      certificate shall be conclusive evidence of the correctness of any such
      adjustment absent manifest error.

     

    6. (1) In
      case
      of any consolidation with or merger of the Company with or into another
      corporation (other than a merger or consolidation in which the Company is the
      surviving or continuing corporation), or in case of any sale, lease, or
      conveyance to another corporation of the property and assets of any nature
      of
      the Company as an entirety or substantially as an entirety (such actions being
      hereinafter collectively referred to as "Reorganizations"), there shall
      thereafter be deliverable upon exercise of this Warrant (in lieu of the number
      of shares of Common Stock theretofore deliverable) the kind and amount of shares
      of stock or other securities or property receivable upon such Reorganization
      by
      a holder of the number of shares of Common Stock, for which this Warrant might
      have been exercised immediately prior to such Reorganization. In case of any
      Reorganization, appropriate adjustment, as determined in good faith by the
      Board
      of Directors of the Company, shall be made in the application of the provisions
      herein set forth with respect to the rights and interests of the Holder so
      that
      the provisions set forth herein shall thereafter be applicable, as nearly as
      possible, in relation to any shares or other property thereafter deliverable
      upon exercise of this Warrant. Any such adjustment shall be made by and set
      forth in a supplemental agreement between the Company, or any successor thereto,
      and the Holder and shall for all purposes hereof conclusively be deemed to
      be an
      appropriate adjustment. The Company shall not effect any such Reorganization
      unless upon or prior to the consummation thereof the successor corporation,
      or
      if the Company shall be the surviving corporation in any such Reorganization
      and
      is not the issuer of the shares of stock or other securities or property to
      be
      delivered to holders of shares of the Common Stock outstanding at the effective
      time thereof, then such issuer, shall assume by written instrument the
      obligation to deliver to the Holder such shares of stock, securities, cash
      or
      other property as the Holder shall be entitled to purchase in accordance with
      the foregoing provisions, and, if such shares or other securities, if any,
      are
      not eligible for immediate sale under the Securities Act of 1933, as amended
      (the “Securities Act”), because they are not registered under the Securities Act
      and no exemption from the registration requirements thereof is available, such
      successor or surviving corporation shall also agree to assume registration
      obligations that are equivalent to those pursuant to any registration rights
      or
      similar agreement between the Holder and the Company.

    

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    (a) In
      case
      of any reclassification or change of the shares of Common Stock issuable upon
      exercise of this Warrant (other than a change in par value or from no par value
      to a specified par value, or as a result of a subdivision or combination of
      the
      outstanding shares of Common Stock, but including any change of the shares
      of
      Common Stock into two or more classes or series of shares), or in case of any
      consolidation or merger of another corporation into the Company in which the
      Company is the continuing corporation and in which there is a reclassification
      or change ('including a change to the right to receive cash or other property)
      of the shares of Common Stock (other than a change in par value, or from no
      par
      value to a specified par value, or as a result of a subdivision or combination
      of the outstanding shares of Common Stock, but including any change of the
      shares into two or more classes or series of shares), the Holder shall have
      the
      right thereafter to receive upon exercise of this Warrant solely the kind and
      amount of shares of stock and other securities, property, cash, or any
      combination thereof receivable upon such reclassification, change,
      consolidation, or merger by a holder of the number of shares of Common Stock
      for
      which this Warrant might have been exercised immediately prior to such
      reclassification, change, consolidation, or merger. Thereafter, appropriate
      provision shall be made for adjustments which shall be as nearly equivalent
      as
      practicable to the adjustments in Section 5.

    

    (b) The
      above
      provisions of this Section 6 shall similarly apply to successive
      reclassifications and changes of shares of Common Stock and to successive
      consolidations, mergers, sales, leases, or conveyances.

    

    7. In
      case
      at any time the Company shall propose:

    

    (a) to
      pay
      any dividend or make any distribution on shares of Common Stock in shares of
      Common Stock or make any other distribution (other than regularly scheduled
      cash
      dividends which are not in a greater amount per share than the most recent
      such
      cash dividend) to all holders of Common Stock; or

    

    (b) to
      issue
      any rights, warrants or other securities to all holders of Common Stock
      entitling them to purchase any additional shares of Common Stock or any other
      rights, warrants or other securities; or

    

    (c) to
      effect
      any reclassification or change of outstanding shares of Common Stock, or any
      consolidation, merger, sale, lease, or conveyance of property, described in
      Section 6; or

    

    (d) to
      effect
      any liquidation, dissolution or winding-up of the Company;

    

    then,
      and
      in any one or more of such cases, the Company shall give written notice thereof,
      by registered mail, postage prepaid, to the Holder at the Holder's address
      as it
      shall appear in the Warrant Register, mailed at least 10 days prior to
      1. the date as of which the holders of record of shares of Common Stock to
      be entitled to receive any such dividend, distribution, rights, warrants, or
      other securities are to be determined or 2. the date on which any such
      reclassification, change of outstanding shares of Common Stock, consolidation,
      merger, sale, lease, conveyance of property, liquidation, dissolution, or
      winding-up is expected to become effective, and the date as of which it is
      expected that holders of record of shares of Common Stock shall be entitled
      to
      exchange their shares for securities or other property, if any, deliverable
      upon
      such reclassification, change of outstanding shards, consolidation, merger,
      sale, lease, conveyance of property, liquidation, dissolution, or
      winding-up.

    

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    8. The
      issuance of any shares or other securities upon the exercise of this Warrant
      and
      the delivery of certificates or other instruments representing such shares
      or
      other securities shall be made without charge to the Holder for any tax or
      other
      charge in respect of such issuance. The Company shall not, however, be required
      to pay any tax which may be payable in respect of any transfer involved in
      the
      issue and delivery of any certificate in a name other than that of the Holder
      and the Company shall not be required to issue or deliver any such certificate
      unless and until the person or persons requesting the issue thereof shall have
      paid to the Company the amount of such tax or shall have established to the
      satisfaction of the Company that such tax has been paid.

    

    9. The
      Warrant Shares issued upon exercise of the Warrant shall be subject to a stop
      transfer order. The certificate or certificates evidencing such Warrant Shares
      shall bear the following legend unless the Warrant Shares are registered
      pursuant to the Act:

    

      "The
        shares represented by this certificate have not been registered under the
        Securities Act of 1933 ("Act") and may not be transferred unless a registration
        statement under the Act is in effect as to that transfer or, in the opinion
        of
        counsel reasonably satisfactory to the Company, registration under the Act
        is
        not necessary for that transfer to comply with the Act."

       

    

    10. Upon
      receipt of evidence satisfactory to the Company of the loss, theft, destruction
      or mutilation of any Warrant (and upon surrender of any Warrant if mutilated),
      and upon reimbursement of the Company's reasonable incidental expenses, the
      Company shall execute and deliver to the Holder thereof a new Warrant of like
      date, tenor and denomination.

    

    11. The
      Holder of any Warrant shall not have, solely on account of such status, any
      rights of a stockholder of the Company, either at law or in equity, or to any
      notice of meetings of stockholders or of any other proceedings of the Company,
      except as provided in this Warrant.

    

    12. This
      Warrant shall be governed by and construed in accordance with the law of the
      State of New York applicable to agreements made and to be performed in New
      York.

    

    
      
         

      

      
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    Dated:
      _______________, 2002

    

    
      	 	
              HEALTH-CHEM
                CORPORATION

            
	 	 
	 	 
	 	
              By:
                ______________________________________

            
	 	
              Name:
                Andy E. Yurowitz

            
	 	
              Title:   Chairman
                

            

    

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    FORM
      OF
      ASSIGNMENT

    

    (To
      be
      executed by the registered holder if such holder desires to transfer the
      attached Warrant).

    

    FOR
      VALUE
      RECEIVED, Lazar & Company IG LLC hereby sells, assigns and transfers
      unto:

    

    Name:     
       _________________________________________

    

    Address: 
      _________________________________________

    

                   
        _________________________________________

    

                  
         _________________________________________

    

    Social
      Security or Tax Identification Number

    

    _________________________________________________

    

    

    a
      Warrant
      to purchase ______ shares of Common Stock, $.01 par value per share, of
      Health-Chem Corporation (the "Company"), together with all right, title, and
      interest therein, and does hereby irrevocably constitute and appoint
      _______________ attorney to transfer such Warrant on the books of the Company,
      with full power of substitution.

    

    Dated:
      ___________________

    
      	 	
              Name:_____________________________________

            
	 	 
	 	
              Address:___________________________________

            
	 	 
	 	__________________________________________
	 	 
	 	__________________________________________ 
	 	 
	 	
              Social
                Security or Tax Identification Number

            
	 	 
	 	__________________________________________
	 	 
	 	
              Signature:__________________________________

            
	 	 
	 	
              NOTE:
                The above signature should correspond exactly with the name on the
                first
                page of this Warrant.

            

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    FORM
      OF
      ELECTION TO EXERCISE

     

    
      	
              To:

            	
              Health-Chem
                Corporation

            
	 	
              101
                Sinking Springs Lane

            
	 	
              Emigsville,
                Pennsylvania 17318

            
	 	
              Attn:
                Andy E. Yurowitz, Chairman

            

    

    

    The
      undersigned hereby exercises his or its rights to purchase ________ Warrant
      Shares covered by the within Warrant and tenders payment herewith in the amount
      of $_______ (or /_/ elects to effect a cashless exercise of the Warrant) in
      accordance with the terms thereof, and requests that certificates for such
      securities be issued in the name of, and delivered to:

    
      

      Name:     
         _________________________________________

      

      Address: 
        _________________________________________

    

    Social
      Security or Tax Identification Number

     

     

    and,
      if
      such number of Warrant Shares shall not be all the Warrant Shares covered by
      the
      within Warrant, that a new Warrant for the balance of the Warrant Shares covered
      by the within Warrant be registered in the name of, and delivered to, the
      undersigned at the address stated below.

     

    
      Dated:
        ___________________

      
        	 	
                Name:_____________________________________

              
	 	 
	 	
                Address:___________________________________

              
	 	 
	 	__________________________________________
	 	 
	 	__________________________________________ 
	 	 
	 	
                Social
                  Security or Tax Identification Number

              
	 	 
	 	__________________________________________
	 	 
	 	
                Signature:__________________________________

              
	 	 
	 	
                
                  NOTE:
                    The above signature should correspond exactly with the name on
                    the first
                    page of this Warrant or with the name of the assignee appearing
                    in the
                    Form of AssignmentCOMMON
      STOCK PURCHASE

    

    WARRANT

    

    THE
      SECURITIES REPRESENTED BY THIS CERTIFICATE, THE COMMON STOCK ISSUABLE UPON
      EXERCISE HEREOF, AND ANY INTEREST THEREIN MAY NOT BE OFFERED OR SOLD EXCEPT
      PURSUANT TO (i) A REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933,
      AS
      AMENDED, OR (ii) AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT.

    

    THE
      TRANSFER OF THIS WARRANT

    IS
      RESTRICTED AS DESCRIBED HEREIN

    

    VOID
      AFTER 5:00 P.M., NEW YORK TIME,

    ON
      JUNE
      19, 2007

    

    HEALTH-CHEM
      CORPORATION

    

    Warrant
      for the Purchase

    of

    237,500
      Shares of Common Stock

    

    No.
      

    

    THIS
      CERTIFIES that, for value received, Hillel Zakai (the "Holder") is entitled
      to
      subscribe for and purchase from Health-Chem Corporation, a Delaware corporation
      (the "Company"), upon the terms and subject to the conditions set forth herein,
      at any time or from time to time, on or after June 19, 2002, and before 5:00
      P.M., New York time, on June 19, 2007 (the "Exercise Period"), two hundred
      thirty seven thousand five hundred (237,500) shares of the Company's Common
      Stock, par value $.01 per share (the "Common Stock"), subject to adjustment
      as
      provided herein (the "Warrant Shares"), at a price of $ .125 per share, subject
      to adjustment as provided herein (the "Exercise Price").

    

    This
      Warrant may not be sold or otherwise disposed of without the Company's prior
      written consent. No transfer of this Warrant or the Warrant Shares will be
      permitted unless a registration statement under the Securities Act of 1933,
      as
      amended (the "Act"), is in effect as to that transfer or, in the opinion of
      counsel reasonably satisfactory to the Company, registration under the Act
      is
      not necessary for that transfer to comply with the Act. The Company has no
      obligation, and does not intend, to register this Warrant or any Warrant Shares
      under the Act. The term the "Holder" as used herein shall include any transferee
      to whom this Warrant has been transferred in accordance with the
      above.

    

    1. This
      Warrant may be exercised during the Exercise Period, as to the whole or any
      lesser number of whole Warrant Shares, by the surrender of this Warrant (with
      the Form of Election to Exercise at the end hereof duly completed and executed)
      to the Company at 101 Sinking Springs Lane, Emigsville, Pennsylvania 17318,
      Attn: Andy E. Yurowitz, Chairman, or at such other place as may be designated
      in
      writing by the Company, together with a certified or bank cashier's check
      payable to the order of the Company, or by the Holder’s causing the
      contemporaneous wire transfer of funds to an account designated by the Company,
      in an amount equal to the Exercise Price multiplied by the number of Warrant
      Shares for which this Warrant is being exercised. Notwithstanding the foregoing,
      at any time that there exists an established trading market for the Common
      Stock, the Holder may elect to cause the cashless exercise of this Warrant,
      in
      which case the Holder shall be entitled to receive a certificate for the number
      of Warrant Shares equal to the product of (I) the quotient obtained by dividing
      (A) (i) the closing price per share for the Common Stock on the principal market
      on which it trades on the trading day preceding the date of delivery of the
      Form
      of Election to Exercise the Warrant to the Company, or if no such closing price
      is available, the average of the closing bid and asked prices on such date,
      or,
      if no such prices are available for such date, on the next preceding trading
      date for which such a closing sale price or, failing that, closing bid and
      asked
      prices may be found (the “Market Price”) minus (ii) the Exercise Price then in
      effect, by (B) the Market Price, multiplied by (II) the number of Warrant Shares
      issuable upon exercise of the Warrant in accordance with its terms without
      regard to this sentence.

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    2. Upon
      each
      exercise of the Holder's rights to purchase Warrant Shares, the Holder shall
      be
      deemed to be the holder of record of the Warrant Shares issuable upon such
      exercise, notwithstanding that the transfer books of the Company shall then
      be
      closed or certificates representing such Warrant Shares shall not then have
      been
      actually delivered to the Holder. As soon as practicable after each such
      exercise of this Warrant, the Company shall issue and deliver to the Holder
      a
      certificate or certificates for the Warrant Shares issuable upon such exercise,
      registered in the name of the Holder. If this Warrant should be exercised in
      part only, the Company shall, upon surrender of this Warrant for cancellation,
      execute and deliver a new Warrant evidencing the right of the Holder to purchase
      the balance of the Warrant Shares (or portions thereof) subject to purchase
      hereunder.

    

    3. Any
      Warrants issued upon the transfer or exercise in part of this Warrant shall
      be
      numbered and shall be registered in a warrant register (the "Warrant Register")
      as they are issued. The Company shall be entitled to treat the registered holder
      of any Warrant on the Warrant Register as the owner in fact thereof for all
      purposes and shall not be bound to recognize any equitable or other claim to
      or
      interest in such Warrant on the part of any other person, and shall not be
      liable for any registration or transfer of Warrants which are registered or
      to
      be registered in the name of a fiduciary or the nominee of a fiduciary unless
      made with the actual knowledge that a fiduciary or nominee is committing a
      breach of trust in requesting such registration or transfer, or with the
      knowledge of such facts that its participation therein amounts to bad faith.
      This Warrant shall be transferable on the books of the Company only upon
      delivery hereof with the Form of Assignment at the end hereof duly completed
      and
      executed by the Holder or by his or its duly authorized attorney or
      representative, or accompanied by proper evidence of succession, assignment,
      or
      authority to transfer. In all cases of transfer by an attorney, executor,
      administrator, guardian or other legal representative, duly authenticated
      evidence of his or its authority shall be produced. Upon any registration of
      transfer, the Company shall deliver a new Warrant or Warrants to the person
      entitled thereto. This Warrant may be exchanged, at the option of the Holder
      thereof, for another Warrant, or other Warrants of different denominations,
      of
      like tenor and representing in the aggregate the right to purchase a like number
      of Warrant Shares (or portions thereof), upon surrender to the Company or its
      duly authorized agent. Notwithstanding the foregoing, the Company shall have
      no
      obligation to cause this Warrant to be transferred on its books to any person
      if, in the opinion of counsel to the Company, such transfer does not comply
      with
      the provisions of the Act and the rules and regulations thereunder.

    

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    4. The
      Company shall at all times during the Exercise Period reserve and keep available
      out of its authorized and unissued Common Stock, solely for the purpose of
      providing for the exercise of the Warrants, such number of shares of Common
      Stock as shall, from time to time, be sufficient therefor. The Company covenants
      that all Warrant Shares, upon receipt by the Company of the full payment
      therefor, shall be validly issued, fully paid, nonassessable, and free of
      preemptive rights.

    

    5. Subject
      to the provisions of this Section 5, the Exercise Price in effect from time
      to
      time shall be subject to adjustment, as follows:

    

    (a) In
      case
      the Company shall at any time after the date the Warrants were first issued
      1. declare a dividend on the outstanding Common Stock payable in shares of
      its capital stock, 2. subdivide the outstanding Common Stock, or
      3. combine the outstanding Common Stock into a smaller number of shares,
      then, in each case, the Exercise Price in effect, and the number of shares
      of
      Common Stock issuable upon exercise of the Warrants outstanding, at the time
      of
      the record date for such dividend or of the effective date of such subdivision
      or combination, shall be proportionately adjusted so that the holders of the
      Warrants after such time shall be entitled to receive the aggregate number
      and
      kind of shares, for the same aggregate Exercise Price as in effect immediately
      prior to such dividend, subdivision or combination, which, if such Warrants
      had
      been exercised immediately prior to such time, such holders would have owned
      upon such exercise and been entitled to receive by virtue of such dividend,
      subdivision, or combination. Such adjustment shall be made successively whenever
      any event listed above shall occur.

    

    (b) All
      calculations under this Section 5 shall be made to the nearest cent or to the
      nearest one-thousandth of a share, as the case may be; provided, however that,
      no adjustment in the Exercise Price shall be required if such adjustment is
      less
      than $.02; and provided, further, that any adjustments which by reason of this
      Section 5 are not required to be made shall be carried forward and taken into
      account in any subsequent adjustment. The Company shall not be required to
      issue
      fractions of shares of Common Stock or other capital stock of the Company upon
      the exercise of this Warrant. If any fraction of a share would be issuable
      on
      the exercise of this Warrant (or specified portions thereof), the Company shall
      purchase such fraction for an amount in cash equal to the same fraction of
      the
      fair market value of such share of Common Stock on the date of exercise of
      this
      Warrant.

    

    (c) In
      any
      case in which this Section 5 shall require that an adjustment in the Exercise
      Price be made effective as of a record date for a specified event (an "Event"),
      the Company may elect to defer, until the occurrence of such Event, issuing
      to
      the Holder, if the Holder exercised this Warrant after such record date, the
      shares of Common Stock, if any, issuable upon such exercise over and above
      the
      number of Warrant Shares, if any, issuable upon such exercise on the basis
      of
      the Exercise Price in effect prior to such adjustment; provided, however, that
      the Company shall deliver to the Holder a due bill or other appropriate
      instrument evidencing the Holder's right to receive such additional shares
      upon
      the occurrence of the Event requiring such adjustment.

    

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    (d) Whenever
      there shall be an adjustment as provided in this Section 5, the Company shall
      within 15 days thereafter cause written notice thereof to be sent by registered
      mail, postage prepaid, to the Holder, at its address as it shall appear in
      the
      Warrant Register, which notice shall be accompanied by an officer's certificate
      setting forth the number of Warrant Shares issuable hereunder and the Exercise
      Price after such adjustment and setting forth a brief statement of the facts
      requiring such adjustment and the computation thereof, which officer's
      certificate shall be conclusive evidence of the correctness of any such
      adjustment absent manifest error.

    

    6. (1) In
      case
      of any consolidation with or merger of the Company with or into another
      corporation (other than a merger or consolidation in which the Company is the
      surviving or continuing corporation), or in case of any sale, lease, or
      conveyance to another corporation of the property and assets of any nature
      of
      the Company as an entirety or substantially as an entirety (such actions being
      hereinafter collectively referred to as "Reorganizations"), there shall
      thereafter be deliverable upon exercise of this Warrant (in lieu of the number
      of shares of Common Stock theretofore deliverable) the kind and amount of shares
      of stock or other securities or property receivable upon such Reorganization
      by
      a holder of the number of shares of Common Stock, for which this Warrant might
      have been exercised immediately prior to such Reorganization. In case of any
      Reorganization, appropriate adjustment, as determined in good faith by the
      Board
      of Directors of the Company, shall be made in the application of the provisions
      herein set forth with respect to the rights and interests of the Holder so
      that
      the provisions set forth herein shall thereafter be applicable, as nearly as
      possible, in relation to any shares or other property thereafter deliverable
      upon exercise of this Warrant. Any such adjustment shall be made by and set
      forth in a supplemental agreement between the Company, or any successor thereto,
      and the Holder and shall for all purposes hereof conclusively be deemed to
      be an
      appropriate adjustment. The Company shall not effect any such Reorganization
      unless upon or prior to the consummation thereof the successor corporation,
      or
      if the Company shall be the surviving corporation in any such Reorganization
      and
      is not the issuer of the shares of stock or other securities or property to
      be
      delivered to holders of shares of the Common Stock outstanding at the effective
      time thereof, then such issuer, shall assume by written instrument the
      obligation to deliver to the Holder such shares of stock, securities, cash
      or
      other property as the Holder shall be entitled to purchase in accordance with
      the foregoing provisions, and, if such shares or other securities, if any,
      are
      not eligible for immediate sale under the Securities Act of 1933, as amended
      (the “Securities Act”), because they are not registered under the Securities Act
      and no exemption from the registration requirements thereof is available, such
      successor or surviving corporation shall also agree to assume registration
      obligations that are equivalent to those pursuant to any registration rights
      or
      similar agreement between the Holder and the Company. 

    

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    (a) In
      case
      of any reclassification or change of the shares of Common Stock issuable upon
      exercise of this Warrant (other than a change in par value or from no par value
      to a specified par value, or as a result of a subdivision or combination of
      the
      outstanding shares of Common Stock, but including any change of the shares
      of
      Common Stock into two or more classes or series of shares), or in case of any
      consolidation or merger of another corporation into the Company in which the
      Company is the continuing corporation and in which there is a reclassification
      or change ('including a change to the right to receive cash or other property)
      of the shares of Common Stock (other than a change in par value, or from no
      par
      value to a specified par value, or as a result of a subdivision or combination
      of the outstanding shares of Common Stock, but including any change of the
      shares into two or more classes or series of shares), the Holder shall have
      the
      right thereafter to receive upon exercise of this Warrant solely the kind and
      amount of shares of stock and other securities, property, cash, or any
      combination thereof receivable upon such reclassification, change,
      consolidation, or merger by a holder of the number of shares of Common Stock
      for
      which this Warrant might have been exercised immediately prior to such
      reclassification, change, consolidation, or merger. Thereafter, appropriate
      provision shall be made for adjustments which shall be as nearly equivalent
      as
      practicable to the adjustments in Section 5.

    

    (b) The
      above
      provisions of this Section 6 shall similarly apply to successive
      reclassifications and changes of shares of Common Stock and to successive
      consolidations, mergers, sales, leases, or conveyances.

    

    7. In
      case
      at any time the Company shall propose:

    

    (a) to
      pay
      any dividend or make any distribution on shares of Common Stock in shares of
      Common Stock or make any other distribution (other than regularly scheduled
      cash
      dividends which are not in a greater amount per share than the most recent
      such
      cash dividend) to all holders of Common Stock; or

    

    (b) to
      issue
      any rights, warrants or other securities to all holders of Common Stock
      entitling them to purchase any additional shares of Common Stock or any other
      rights, warrants or other securities; or

    

    (c) to
      effect
      any reclassification or change of outstanding shares of Common Stock, or any
      consolidation, merger, sale, lease, or conveyance of property, described in
      Section 6; or

    

    (d) to
      effect
      any liquidation, dissolution or winding-up of the Company;

    then,
      and
      in any one or more of such cases, the Company shall give written notice thereof,
      by registered mail, postage prepaid, to the Holder at the Holder's address
      as it
      shall appear in the Warrant Register, mailed at least 10 days prior to
      1. the date as of which the holders of record of shares of Common Stock to
      be entitled to receive any such dividend, distribution, rights, warrants, or
      other securities are to be determined or 2. the date on which any such
      reclassification, change of outstanding shares of Common Stock, consolidation,
      merger, sale, lease, conveyance of property, liquidation, dissolution, or
      winding-up is expected to become effective, and the date as of which it is
      expected that holders of record of shares of Common Stock shall be entitled
      to
      exchange their shares for securities or other property, if any, deliverable
      upon
      such reclassification, change of outstanding shards, consolidation, merger,
      sale, lease, conveyance of property, liquidation, dissolution, or
      winding-up.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    8. The
      issuance of any shares or other securities upon the exercise of this Warrant
      and
      the delivery of certificates or other instruments representing such shares
      or
      other securities shall be made without charge to the Holder for any tax or
      other
      charge in respect of such issuance. The Company shall not, however, be required
      to pay any tax which may be payable in respect of any transfer involved in
      the
      issue and delivery of any certificate in a name other than that of the Holder
      and the Company shall not be required to issue or deliver any such certificate
      unless and until the person or persons requesting the issue thereof shall have
      paid to the Company the amount of such tax or shall have established to the
      satisfaction of the Company that such tax has been paid.

    

    9. The
      Warrant Shares issued upon exercise of the Warrant shall be subject to a stop
      transfer order. The certificate or certificates evidencing such Warrant Shares
      shall bear the following legend unless the Warrant Shares are registered
      pursuant to the Act:

    

    "The
      shares represented by this certificate have not been registered under the
      Securities Act of 1933 ("Act") and may not be transferred unless a registration
      statement under the Act is in effect as to that transfer or, in the opinion
      of
      counsel reasonably satisfactory to the Company, registration under the Act
      is
      not necessary for that transfer to comply with the Act."

    

    10. Upon
      receipt of evidence satisfactory to the Company of the loss, theft, destruction
      or mutilation of any Warrant (and upon surrender of any Warrant if mutilated),
      and upon reimbursement of the Company's reasonable incidental expenses, the
      Company shall execute and deliver to the Holder thereof a new Warrant of like
      date, tenor and denomination.

    

    11. The
      Holder of any Warrant shall not have, solely on account of such status, any
      rights of a stockholder of the Company, either at law or in equity, or to any
      notice of meetings of stockholders or of any other proceedings of the Company,
      except as provided in this Warrant.

    

    12. This
      Warrant shall be governed by and construed in accordance with the law of the
      State of New York applicable to agreements made and to be performed in New
      York.

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    

    Dated:
      _______________, 2002

    

    
      

      
        	 	
                HEALTH-CHEM
                  CORPORATION

              
	 	 
	 	 
	 	
                By:
                  ______________________________________

              
	 	
                Name:
                  Andy E. Yurowitz

              
	 	
                Title:   Chairman
                  

              

      

      

        
          
            
            

          

          
            7

            
              

            

          

          
            
            

          

        

      

    

     

    FORM
      OF
      ASSIGNMENT

    

    (To
      be
      executed by the registered holder if such holder desires to transfer the
      attached Warrant).

    

    FOR
      VALUE
      RECEIVED, Hillel Zakai hereby sells, assigns and transfers unto:

    
      

      Name:     
         _________________________________________

      

      Address: 
        _________________________________________

      

                     
          _________________________________________

      

                    
           _________________________________________

      

      Social
        Security or Tax Identification Number

      

      _________________________________________________

      

      

      a
        Warrant
        to purchase ______ shares of Common Stock, $.01 par value per share, of
        Health-Chem Corporation (the "Company"), together with all right, title,
        and
        interest therein, and does hereby irrevocably constitute and appoint
        _______________ attorney to transfer such Warrant on the books of the Company,
        with full power of substitution.

      

      Dated:
        ___________________

      
        	 	
                Name:_____________________________________

              
	 	 
	 	
                Address:___________________________________

              
	 	 
	 	__________________________________________
	 	 
	 	__________________________________________ 
	 	 
	 	
                Social
                  Security or Tax Identification Number

              
	 	 
	 	__________________________________________
	 	 
	 	
                Signature:__________________________________

              
	 	 
	 	
                NOTE:
                  The above signature should correspond exactly with the name on
                  the first
                  page of this Warrant.

              

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      FORM
        OF
        ELECTION TO EXERCISE

       

      
        	
                To:

              	
                Health-Chem
                  Corporation

              
	 	
                101
                  Sinking Springs Lane

              
	 	
                Emigsville,
                  Pennsylvania 17318

              
	 	
                Attn:
                  Andy E. Yurowitz, Chairman

              

      

      

      The
        undersigned hereby exercises his or its rights to purchase ________ Warrant
        Shares covered by the within Warrant and tenders payment herewith in the
        amount
        of $_______ (or /_/ elects to effect a cashless exercise of the Warrant)
        in
        accordance with the terms thereof, and requests that certificates for such
        securities be issued in the name of, and delivered to:

      
        

        Name:     
           _________________________________________

        

        Address: 
          _________________________________________

      

      Social
        Security or Tax Identification Number

       

       

      and,
        if
        such number of Warrant Shares shall not be all the Warrant Shares covered
        by the
        within Warrant, that a new Warrant for the balance of the Warrant Shares
        covered
        by the within Warrant be registered in the name of, and delivered to, the
        undersigned at the address stated below.

       

      
        Dated:
          ___________________

        
          	 	
                  Name:_____________________________________

                
	 	 
	 	
                  Address:___________________________________

                
	 	 
	 	__________________________________________
	 	 
	 	__________________________________________ 
	 	 
	 	
                  Social
                    Security or Tax Identification Number

                
	 	 
	 	__________________________________________
	 	 
	 	
                  Signature:__________________________________

                
	 	 
	 	
                  
                    NOTE:
                      The above signature should correspond exactly with the name
                      on the first
                      page of this Warrant or with the name of the assignee appearing
                      in the
                      Form of Assignment

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