Document:

Exhibit 10.119

	EXHIBIT 10.119

	 	THE
SECURITIES REPRESENTED HEREBY HAVE BEEN ISSUED WITHOUT REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY STATE SECURITIES LAWS, AND MAY NOT
BE SOLD, TRANSFERRED OR PLEDGED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
UNDER APPLICABLE FEDERAL AND STATE SECURITIES LAWS OR AN OPINION OF COUNSEL
REASONABLY SATISFACTORY TO THE COMPANY THAT THE TRANSFER IS EXEMPT FROM REGISTRATION
UNDER APPLICABLE FEDERAL AND STATE SECURITIES LAWS.

	THE IMMUNE RESPONSE CORPORATION
8% CONVERTIBLE SECURED PROMISSORY NOTE

	$200,000 	New York, New York

      November 20, 2002

	                    FOR
the  receipt of $200,000  ($7,000 of which is deemed to have been  previously  received)
the  undersigned,  The Immune  Response  Corporation,  a Delaware  Corporation  (the
“Issuer”),  hereby  unconditionally  promises to pay on the Note Maturity Date
(as defined in that certain Note Purchase  Agreement,  dated  November 9,  2001, by and
between Kevin  Kimberlin  Partners,  L.P.  (“KKP”) and the Issuer,  and as
amended by Amendment No. 1,  dated as of February 14, 2002 and  Amendment  No. 2, dated
as of May 3, 2002,  each by and between the Issuer,  KKP  and Oshkim Limited  Partnership
(“Oshkim”)  and as further  amended by Amendment No. 3, dated as of July 11,
2002,  by and between  the Issuer,  KKP,  Oshkim and The  Kimberlin  Family  1998
Irrevocable  Trust (the “Note  Purchase  Agreement”)) to the order of Cheshire
Associates LLC (the “Purchaser”),  at the office of the Purchaser located at
535 Madison Avenue,  18th Floor,  New York, New York 10022, or such other address
designated by the Purchaser,  in  lawful money of the United  States of America and in
immediately  available  funds,  the  principal  amount of (a)  $200,000.00  or (b) if
less as a result of any  voluntary  conversion(s)  of this Note in part in  accordance
with  Section  3.4 of the Note  Purchase  Agreement,  the  aggregate  unpaid  principal
amount of this Note.  Subject to  Section 3.4 of the Note  Purchase  Agreement,  the
Issuer  further  agrees to pay interest on the unpaid  principal  amount  outstanding
hereunder from time to time,  from the date hereof,  in like money,  at the rate of eight
(8%)  percent per annum, as and at the dates specified in Section 3.3 of the Note
Purchase Agreement.

	                    This
Note is one of the  promissory  notes  referred to in the Note  Purchase  Agreement,  and
is  entitled to the benefits  thereof,  is secured as provided  therein  (and as provided
in that certain  Intellectual  Property  Security  Agreement,  dated  November 9, 2001,
by and between the Issuer and KKP, as amended by Amendment  No. 1, dated  February 26,
2002,  by and between the Issuer,  KKP and Oshkim,  and as further  amended by Amendment
No. 2, dated July 11,  2002,  by and between the Issuer,  KKP,  Oshkim and the  Kimberlin
Trust) and is subject to  conversion as set forth therein.  In the event of any conflict
between the Note Purchase  Agreement and this Note,  the terms and provisions of the Note
Purchase Agreement shall govern.

 

 

	                    Upon
the  occurrence  of any one or more of the Events of Default  specified in the Note
Purchase  Agreement,  all amounts  then  remaining  unpaid on this Note and all  amounts
then  remaining  unpaid on any note  issued by the Issuer to the Purchaser or to any
affiliate  and/or related party of the Purchaser  shall become,  or  may be declared to
be, immediately due and payable.

	                    Subject
to the provisions of the legend above, this Note is freely  transferable,  in whole or in
part, by the Purchaser,  and such  transferee  shall have the same rights  hereunder as
the  Purchaser.  The Issuer  may not  assign or  delegate  any of its  obligations  under
this Note  without  the prior  written  consent of the  Purchaser (or its successor,
transferee or assignee).

	                    All
parties  now and  hereafter  liable  with  respect to this Note,  whether  maker,
principal,  surety, guarantor,  endorser or otherwise,  hereby waive presentment,
demand, protest and all other notices of any  kind.

	                    Subject
to  Section  3.3 of the Note  Purchase  Agreement,  the  Issuer  agrees to pay all of the
Purchaser’s  expenses,  including reasonable  attorneys’ costs and fees, incurred in
collecting sums due under this  Note.

	                    This
Note shall be subject to prepayment  only in accordance  with the terms of the Note
Purchase  Agreement.

	                    This
Note shall be governed by, and construed and  interpreted  in accordance  with,  the laws
of  the State of New York.

	 	THE IMMUNE RESPONSE CORPORATION

	 	By:____________________________

           Name:________________________

           Title: _____________________

 
	 	
2Exhibit 10.120

	EXHIBIT 10.120

	WARRANT AGREEMENT

	          WARRANT
AGREEMENT (this “Agreement”), dated as of November 20, 2002, by and
between The Immune Response Corporation, a Delaware corporation (the
“Company”), and Cheshire Associates LLC, a Delaware limited liability
company (the “Warrant Holder”).

	W I T N E S S E T H

	          WHEREAS,
the parties have entered into that certain Note Purchase Agreement, dated as of
November 9, 2001, by and between the Company and Kevin Kimberlin Partners, L.P.
(“KKP”), as amended by Amendment No. 1 to the Note Purchase Agreement,
dated as of February 14, 2002 and Amendment No. 2 dated as of May 3, 2002, each
by and between the Company, KKP and Oshkim Limited Partnership
(“Oshkim”) and as further amended by Amendment No. 3 by and between
the Company, KKP, Oshkim and The Kimberlin Family 1998 Irrevocable Trust (the
“Note Purchase Agreement”); and

	          WHEREAS,
pursuant to the Note Purchase Agreement, the Warrant Holder has agreed to loan
to the Company $200,000 Dollars (the “Loan Amount”), subject to the
issuance by the Company of a convertible secured promissory note (the
“Note”), and the Company has agreed to issue to the Warrant Holder
warrants (the “Warrants”) to purchase [_________] shares of the
Company’s common stock, par value $.0025 per share (the “Common
Stock”), which equals the Loan Amount divided by eighty (80%) percent of
the Exercise Price (as defined in Section 1 hereof), subject to the terms set
forth herein.

	          NOW,
THEREFORE, in consideration of the foregoing and the mutual covenants and
promises contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:

	          1.
  Warrants. The Company hereby grants to the Warrant Holder, subject to the terms
set forth herein, the right to purchase from the Company at any time and from
time to time after the date hereof until 5:00 p.m., New York City local time, on
November 12, 2012 (the “Expiration Date”), up to [_________] fully
paid and non-assessable shares of Common Stock, subject to adjustment pursuant
to Section 3 hereof (the “Shares”), which number of Shares equals the
Loan Amount divided by eighty (80%) percent of the Exercise Price.
Notwithstanding the foregoing, the Warrants shall only be exercisable to the
extent that shares of Common Stock issuable on exercise of the Warrants, when
aggregated with (i) the Company’s outstanding shares of Common Stock as of
the date hereof and (ii) shares of Common Stock issuable on conversion or
exercise, as the case may be, of notes, warrants and stock options outstanding
as of the date hereof, would not exceed the number of shares authorized under
the Company’s Restated Certificate of Incorporation, as amended. The
Company shall promptly cause its Restated Certificate of Incorporation, as
amended, to be further amended to increase the number of shares of Common Stock
authorized thereunder as shall be sufficient for reserving and making available
shares of Common Stock issuable upon the exercise in full of the Warrants issued
to the Warrant holder hereunder. For purposes of this Agreement, the
“Exercise Price” shall initially be $[_____], which is equal to the
average of the closing bid prices of the Common Stock for the ten (10)
consecutive trading days immediately preceding the date hereof, subject to any
adjustments pursuant to Section 3 hereof.

 

 

	          2.
  Exercise of Warrants.

	                    2.1
  Exercise. The Warrants may be exercised by the Warrant Holder, in whole or in part, by
delivering the Notice of Exercise purchase form, attached as Exhibit A hereto, duly
executed by the Warrant Holder to the Company at its principal office, or at such other
office as the Company may designate, accompanied by payment, in cash or by wire transfer
or check payable to the order of the Company, of the amount obtained by multiplying the
number of Shares designated in the Notice of Exercise by the Exercise Price (the
“Purchase Price”). The Purchase Price may also be paid, in whole or in part,
by delivery of such purchase form and of shares of Common Stock owned by the Warrant
Holder having a Fair Market Value (as defined in Section 2.3 hereof) on the last
trading day ending the day immediately preceding the Exercise Date (as defined below)
equal to the portion of the Purchase Price being paid in such shares. In addition, the
Warrants may be exercised, pursuant to a cashless exercise, except as set forth in
Section 3.3(4) below, by providing irrevocable instructions to the Company, through
delivery of the aforesaid purchase form with an appropriate reference to this Section
2.1 to issue the number of shares of the Common Stock equal to the product of (a) the
number of shares as to which the Warrants are being exercised multiplied by (b) a
fraction, the numerator of which is the Fair Market Value of a share of the Common Stock
on the last business day preceding the Exercise Date less the Exercise Price therefore
and the denominator of which is such Fair Market Value. For purposes hereof,
“Exercise Date” shall mean the date on which all deliveries required to be
made to the Company upon exercise of Warrants pursuant to this Section 2.1 shall have
been made.

	                    2.2
  Issuance of Certificates. As soon as practicable after the exercise of the Warrants (in
whole or in part) in accordance with Section 2.1 hereof, the Company, at its expense,
shall cause to be issued in the name of and delivered to the Warrant Holder (i) a
certificate or certificates for the number of fully paid and non-assessable Shares to
which the Warrant Holder shall be entitled upon such exercise and (if applicable) (ii) a
new warrant agreement of like tenor to purchase all of the Shares that may be purchased
pursuant to the portion, if any, of the Warrants not exercised by the Warrant Holder.
The Warrant Holder shall for all purposes be deemed to have become the holder of record
of such Shares on the date on which the Notice of Exercise and payment of the Purchase
Price in accordance with Section 2.1 hereof were delivered and made, respectively,
irrespective of the date of delivery of such certificate or certificates, except that if
the date of such delivery, notice and payment is a date when the stock transfer books of
the Company are closed, such person shall be deemed to have become the holder of record
of such Shares at the close of business on the next succeeding date on which the stock
transfer books are open.

	                    2.3
  Fair Market Value. The “Fair Market Value” of a share of
Common Stock on any  day means: (a) if the principal market for the Common Stock is The
Nasdaq National  Market or any other national securities exchange, the last sales price
of the Common  Stock on such day as reported by such exchange or market, or on a
consolidated tape  reflecting transactions on such exchange or market, or (b) if the
principal market for  the Common Stock is not a national securities exchange or The
Nasdaq National Market and  the Common Stock is quoted on the National Association of
Securities Dealers Automated  Quotations System, the mean between the closing bid and the
closing asked prices for the  Common Stock on such day as quoted on such System, or (c)
if the Common Stock is not  quoted on the National Association of Securities Dealers
Automated Quotations System,  the mean between the highest bid and lowest 

 
	 	
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	asked prices for the Common Stock on such day as reported
      by Pink Sheets LLC; provided, however, that if none of (a),
      (b) or (c) above is applicable, or if no trades have been made or no quotes
      are available for such day, the Fair Market Value of the Common Stock shall
      be reasonably determined, in good faith, by the Board of Directors of the
      Company (the “Board of Directors”).

	          3.
  Adjustments.

	                    3.1
  Stock Splits, Stock Dividends and Combinations. If the Company at any time subdivides
the outstanding shares of the Common Stock or issues a stock dividend (in Common Stock)
on the outstanding shares of the Common Stock, the Exercise Price in effect immediately
prior to such subdivision or the issuance of such stock dividend shall be
proportionately decreased, and the number of Shares subject hereto shall be
proportionately increased, and if the Company at any time combines (by reverse stock
split or otherwise) the outstanding shares of Common Stock, the Exercise Price in effect
immediately prior to such combination shall be proportionately increased, and the number
of Shares subject hereto shall be proportionately decreased, effective at the close of
business on the date of such subdivision, stock dividend or combination, as the case may
be.

	                    3.2
  Merger or Consolidation. In the case of any consolidation of the Company with, or merger
of the Company with or into another entity (other than a consolidation or merger which
does not result in any reclassification or change of the outstanding capital stock of
the Company), the entity formed by such consolidation or merger shall execute and
deliver to the Warrant Holder a supplemental warrant agreement providing that the
Warrant Holder of the Warrants then outstanding or to be outstanding shall have the
right thereafter (until the expiration of such Warrants) to receive, upon exercise of
such Warrants, the kind and amount of shares of capital stock and other securities and
property receivable upon such consolidation or merger by a holder of the number of
Shares for which such Warrants might have been exercised immediately prior to such
consolidation or merger. Such supplemental warrant agreement shall contain provisions
which shall be identical to the adjustments provided in Section 3.1 hereof and to the
provisions of Section 10 hereof. This Section 3.2 shall similarly apply to successive
consolidations or mergers.

	                    3.3
  The Exercise Price shall also be subject to adjustment as follows:

	                           (1)
       Special Definitions. For purposes of this Section 3.3, the following
      definitions shall apply:

	                                  (A)
      “Options” shall mean rights, options or warrants to subscribe
      for, purchase or otherwise acquire Common Stock or Convertible Securities.

	                                  (B)
      “Original Issue Date” shall mean the date of this Agreement.

	                                  (C)
      “Convertible Securities” shall mean any evidence of indebtedness,
      shares of capital stock (other than Common Stock) or other securities convertible
      into or exchangeable for Common Stock.

 
	 	
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	                                  (D)
      “Additional Shares of Common Stock” shall mean all shares of Common
      Stock issued by the Company on or after the Original Issue Date, other than
      shares of Common Stock issued at any time:

	                                        (i)
      pursuant to the exercise of options, warrants or other Common Stock purchase
      rights issued (or to be issued) to employees, officers or directors of,
      or consultants or advisors to, or any strategic ally of, the Company pursuant
      to any stock purchase or stock option plan or other arrangement approved
      by the Board of Directors;

	                                        (ii)
      pursuant to the exercise of options, warrants or Convertible Securities
      outstanding as of the Original Issue Date; or

	                                        (iii)
      in connection with the acquisition of all or part of another entity by stock
      acquisition, merger, consolidation or other reorganization, or by the purchase
      of all or part of the assets of such other entity (including securities
      issued to persons formerly employed by such other entity and subsequently
      hired by the Company and to any brokers or finders in connection therewith)
      where the Company or its stockholders own more than fifty (50%) percent
      of the voting power of the acquired, surviving, combined or successor company.

	                    (2)
  Issuance of Options and Convertible Securities. In the event the Company at any time or
from time to time after the Original Issue Date shall issue any Options (other than any
additional warrants issued to the Warrant Holder or any affiliate thereof in accordance
with the terms and provisions of the Note Purchase Agreement) or Convertible Securities
without consideration or for a consideration per share less than the then-applicable
Exercise Price, then and in such event, such Exercise Price shall be reduced,
concurrently with such issue, to a price (calculated to the nearest cent) determined by
multiplying the then-applicable Exercise Price by a fraction, (i) the numerator of which
shall be the number of shares of Common Stock issued and outstanding (on a
fully-diluted basis) immediately prior to such issuance plus the quotient obtained by
dividing (x) the aggregate consideration received or to be received by the Company for
the total number of Additional Shares of Common Stock issuable upon the exercise,
conversion or exchange of such Options or Convertible Securities by (y) the Exercise
Price, and (ii) the denominator of which shall be the number of shares of Common Stock
issued and outstanding (on a fully-diluted basis) immediately prior to such issuance
plus the number of Additional Shares of Common Stock issuable upon the exercise,
conversion or exchange of such Options or Convertible Securities. Upon each such
adjustment of the then-applicable Exercise Price pursuant to the provisions of this
Section 3.3(2), the number of Warrant Shares purchasable upon the exercise of each
Warrant shall be adjusted to the nearest full amount by multiplying a number equal to
the Exercise Price in effect immediately prior to such adjustment by the number of
Warrant Shares purchasable upon the exercise of each Warrant immediately prior to such
adjustment and dividing the product so obtained by the adjusted Exercise Price.

	                    (3)
       Adjustment of Exercise Price Upon Issuance of Additional Shares
      of Common Stock. In the event the Company, after the Original Issue
      Date, shall issue Additional Shares of Common Stock without consideration
      or for a consideration per share less than the then-applicable Exercise
      Price, then and in such event, such Exercise Price shall be reduced, concurrently
      with such issue, to a price (calculated to the nearest cent) determined
      by 

 
	 	
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	multiplying the then-applicable  Exercise Price
by a fraction, (i) the numerator of which shall be the number of  shares of Common Stock
issued and outstanding (on a fully-diluted basis)  immediately prior to such issuance
plus the quotient obtained by dividing (x)  the aggregate consideration received by the
Company for the total number of  Additional Shares of Common Stock so issued by (y) the
Exercise Price, and (ii)  the denominator of which shall be the number of shares of
Common Stock issued  and outstanding (on a fully-diluted basis) immediately prior to such
issuance  plus the number of Additional Shares of Common Stock so issued. Upon each such
adjustment of the then-applicable Exercise Price pursuant to the provisions of  this
Section 3.3(3), the number of Warrant Shares purchasable upon the exercise  of each
Warrant shall be adjusted to the nearest full amount by multiplying a  number equal to
the Exercise Price in effect immediately prior to such  adjustment by the number of
Warrant Shares purchasable upon the exercise of each  Warrant immediately prior to such
adjustment and dividing the product so  obtained by the adjusted Exercise Price.

	                    (4)
  Adjustment of Exercise Price Upon Adverse Market Conditions. Notwithstanding anything
to the contrary contained herein, if at any time after the Original Issue Date, the
average of the closing bid prices of the Common Stock for any ten (10) consecutive
trading days (the “Ten-Day Average”) shall be less than the product obtained
by multiplying (x) seventy-five (75%) percent times (y) the Exercise Price otherwise
then in effect (the “Adverse Market Price”), then such Ten-Day Average may,
subject to the terms of this Section 3.3(4), become and constitute the adjusted Exercise
Price (the “Adjusted Exercise Price”), and the Warrants may be exercised, in
whole or in part, by the Warrant Holder at the Adjusted Exercise Price. To exercise all
or any portion of the Warrants at the Adjusted Exercise Price, the Warrant Holder shall
(i) deliver written notice (the “Adverse Market Price Notice”) of such intent
to the Company during such time as the Ten-Day Average shall remain equal to or below
the Adverse Market Price and (ii) provide payment by cash or wire transfer of
immediately available funds in respect of such Warrants to be exercised to the Company
within five (5) trading days after delivery of the Adverse Market Price Notice. The
Ten-Day Average based on the ten (10) consecutive trading days ending on the date that
the Adverse Market Price Notice shall have been delivered by the Warrant Holder shall be
the Adjusted Exercise Price, unless (A) the Warrant Holder shall not deliver the
applicable payment by cash or wire transfer within the five (5) trading days following
delivery of the Adverse Market Price Notice or (B) the Warrant Holder shall have
provided a new Adverse Market Price Notice during such five (5) trading days period, in
which case the Adjusted Exercise Price shall be adjusted based on the Ten-Day Average
preceding such new Adverse Market Price Notice. The provisions of this Section 3.3(4)
shall continue until all of the Warrants shall have been exercised. The number of
Warrant Shares shall not be adjusted as a result of any adjustment of the
then-applicable Exercise Price pursuant to the provisions of this Section 3.3(4).

	                    (5)
  Determination of Consideration. For purposes of this Section 3, the consideration
received by the Company for the issue of any Additional Shares of Common Stock shall be
computed as follows:

	                                 (A)
  Cash and Property. Such consideration shall:

	                                         (i)
      insofar as it consists of cash, be computed at the net amount of cash received
      by the Company excluding expenses, discounts and commissions 

 
	 	
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	payable by the Company in  connection with such
issuance or sale and  amounts paid or payable for accrued interest.

	                                         (ii)
      insofar as it consists of property other than cash, be computed at the fair
      value thereof at the time of such issue, as reasonably determined in good
      faith by the Board of Directors net of expenses as set forth in clause (i)
      above; and

	                                        (iii)
      in the event Additional Shares of Common Stock are issued together with
      other shares or securities or other assets of the Company for consideration
      that covers both cash and property other than cash, the proportion of such
      consideration so received, computed as provided in clauses (i) and (ii)
      above, shall be as reasonably determined in good faith by the Board of Directors.

	                           (B)
Options and Convertible Securities. The  consideration per share  received by the Company
for the issuance of Options or Convertible Securities  pursuant to Section 3.3(2) shall
be determined by dividing:

	                                      (i)
      the total amount, received by the Company as consideration for the issuance
      of such Options or Convertible Securities, plus the minimum aggregate amount
      of additional consideration payable to the Company upon the exercise of
      such Options or the conversion or exchange of such Convertible Securities,
      or in the case of Options for Convertible Securities, the exercise of such
      Options for Convertible Securities and the conversion or exchange of such
      Convertible Securities (subject to any adjustments in the exercise price
      thereof), by

	                                     (ii)
      the number of shares of Common Stock issuable upon the exercise of such
      Options or the conversion or exchange of such Convertible Securities or,
      in the case of Options for Convertible Securities, the exercise of such
      Options for Convertible Securities and the conversion or exchange of such
      Convertible Securities.

	                    3.4
  Certificate as to Adjustments. Upon the occurrence of each adjustment or readjustment of
the Exercise Price pursuant to this Section 3, the Company, at its expense, shall
promptly compute such adjustment or readjustment of the Exercise Price in accordance
with the terms hereof and furnish to each Holder of Warrants a certificate setting forth
such adjustment or readjustment and showing in detail the facts upon which such
adjustment or readjustment is based, including a statement of (i) the consideration
received or deemed to be received by the Company for any Additional Shares of Common
Stock issued or deemed to have been issued, (ii) the Exercise Price in effect
immediately prior to such adjustment or readjustment, (iii) the number of Additional
Shares of Common Stock issued or deemed to have been issued and (iv) the number of
shares of Common Stock and the amount, if any, of other securities or property that at
the time would be received upon the exercise of the Warrants. The Company shall, upon
the written request at any time of any Holder of Warrants, furnish or cause to be
furnished to such Holder a like certificate setting forth (x) all adjustments and
readjustments of the Exercise Price since the Original Issue Date and (y) the Exercise
Price then in effect.

	                    3.5
  Assurances With Respect to Exercise Rights. The Company shall not, by
amendment of its  Certificate of Incorporation or By-laws or through any reorganization,
transfer of  assets, consolidation, merger, dissolution, issue or sale of securities or
any other  voluntary 

 
	 	
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	action, avoid or seek to avoid the observance or
performance of any of the  terms to be observed or performed hereunder by the Company,
but shall at all times, in  good faith, assist in the carrying out of all the provisions
of this Agreement and in  taking of all such actions as may be necessary or appropriate
in order to protect the  exercise rights of the Warrant Holder against impairment or
dilution.

	          4.
  Transfers.

	                    4.1
  Unregistered Securities. The Warrant Holder hereby acknowledges and agrees that the
Warrants and the Shares have not been registered under the Securities Act of 1933, as
amended (the “Securities Act”), and are “restricted securities”
under the Securities Act inasmuch as they are being acquired in a transaction not
involving a public offering, and the Warrant Holder agrees not to sell, pledge,
distribute, offer for sale, transfer or otherwise dispose of the Warrants or any Shares
issued upon exercise of the Warrants in the absence of (a) an effective registration
statement under the Act as to the Warrants or such Shares and registration and/or
qualification of the Warrants or such Shares under any applicable Federal or state
securities law then in effect or (b) an opinion of counsel, reasonably satisfactory to
the Company, that such registration and qualification are not required.

	                    4.2
  Transferability. Subject to the provisions of Section 4.1 hereof, the rights under this
Agreement are freely transferable, in whole or in part, by the Warrant Holder, and such
transferee shall have the same rights hereunder as the Warrant Holder.

	                    4.3
  Warrant Register. The Company will maintain a register containing the names and
addresses of the Warrant Holders of the Warrants. Until any transfer of Warrants in
accordance with this Agreement is reflected in the warrant register, the Company may
treat the Warrant Holder as the absolute owner hereof for all purposes. Any Warrant
Holder may change such Warrant Holder’s address as shown on the warrant register by
written notice to the Company requesting such change.

	          5.
  No Fractional Shares. Any adjustment in the number of Shares purchasable hereunder shall
be rounded to the nearest whole share.

	          6.
  Investment Representations. The Warrant Holder agrees and acknowledges that it
is acquiring the Warrants and will be acquiring the Shares for its own account
and not with a view to any resale or distribution other than in accordance with
Federal and state securities laws. The Warrant Holder is an “accredited
investor” within the meaning of Rule 501(a) of Regulation D promulgated
under the Securities Act.

	          7.
  Covenants as to the Shares. The Company covenants and agrees that, subject to
Sections 6.2(a) of the Note Purchase Agreement, the shares of Common Stock issuable upon
exercise of the Warrants, will, upon issuance in accordance with the terms hereof, be
duly and validly issued and outstanding, fully paid and nonassessable, with no personal
liability attaching to the ownership thereof, and free from all taxes, liens and charges
with respect to the issuance thereof imposed by or through the Company; provided,however, that the Company shall not be required to pay any tax that may be payable in
respect of any transfer involved in the issuance and delivery of any certificates in
respect of such shares in a name other than that of the Warrant Holder and the Company
shall not be required to issue or deliver such certificates unless or until 

 
	 	
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	the person(s)  requesting the issuance thereof
shall have paid to the Company the amount of  such tax or it shall be established to the
satisfaction of the Company that such  tax has been paid. The Company further covenants
and agrees that the Company  will at all times have authorized and reserved, free from
preemptive rights  imposed by or through the Company, a sufficient number of shares of
Common Stock  to provide for the exercise of the rights represented under this Agreement.

	          8.
  Legend. Any certificate evidencing the Shares issuable upon exercise hereof will
bear a legend indicating that such securities have not been registered under the
Securities Act or under any state securities laws and may not be sold or offered
for sale in the absence of an effective registration statement as to the
securities under the Securities Act and any applicable state securities law or
an opinion of counsel reasonably satisfactory to the Company that such
registration is not required.

	          9.
  Rights Applicable to the Warrant Shares. The parties hereby acknowledge and
agree that the Shares, when issued in accordance with the terms hereof, shall be
entitled to all of the same rights and privileges provided to the Company’s
capital stock issued upon conversion of the Note, as set forth in the Note
Purchase Agreement.

	          10.
  Dividends and Other Distributions. In the event that the Company shall, at any
time prior to the exercise of all Warrants, declare a dividend (other than a
dividend consisting solely of shares of Common Stock) or otherwise distribute to
its stockholders any assets, properties, rights, evidence of indebtedness,
securities (other than shares of Common Stock), whether issued by the Company or
by another, or any other thing of value, the Warrant Holder shall thereafter be
entitled, in addition to the shares of Common Stock or other securities and
property receivable upon the exercise thereof, to receive, upon the exercise of
such Warrants, the same property, assets, rights, evidences of indebtedness,
securities or any other thing of value that the Warrant Holder would have been
entitled to receive at the time of such dividend or distribution as if the
Warrants had been exercised immediately prior to such dividend or distribution.
At the time of any such dividend or distribution, the Company shall make (and
maintain) appropriate reserves to ensure the timely performance of the
provisions of this Section 10.

	          11.
  Miscellaneous.

	                    11.1
  Waivers and Amendments. This Agreement or any provisions hereof may be changed, waived,
discharged or terminated only by a statement in writing signed by the Company and by the
Warrant Holder.

	                    11.2
  Governing Law. This Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of New York.

	                    11.3
  Notices. All notices and other communications hereunder shall be in writing and shall be
deemed to have been given when delivered by hand or by facsimile transmission, when
telexed, or upon receipt when mailed by registered or certified mail (return receipt
requested), postage prepaid, to the parties at the following addresses (or at such other
address for a party as shall be specified by like notice):

 
	 	
8	 

 

 

	(i)	 If to the Company:

	 	The Immune Response Corporation 

      5935 Darwin Court

      Carlsbad, CA 92008 

      Attention: President 

      Facsimile: (760) 431-8636

	 	With a copy (which copy shall not constitute notice)
      to:

	 	Pillsbury Winthrop LLP 

      50 Fremont Street 

      San Francisco, CA 94105

      Attention: Thomas E. Sparks, Esq. 

      Facsimile: (415) 983-7396

	(ii)	 If to the Warrant Holder:

	 	Oshkim Limited Partnership 

      535 Madison Avenue 

      New York, NY 10022 

      Attention: Kevin Kimberlin and Bruno Lerer, Esq. 

      Facsimile: (212) 486-7392

	 	With a copy (which copy shall not constitute notice)
      to:

	 	Kirkpatrick & Lockhart LLP 

      1251 Avenue of the Americas, 45th Floor 

      New York, NY 10020-1104 

      Attention: Stephen R. Connoni, Esq./Sandip Kakar, Esq. 

      Facsimile: (212) 536-3901

	                    11.4
  Headings. The headings in this Agreement are for convenience of reference only, and
shall not limit or otherwise affect the terms hereof.

	                    11.5
  Closing of Books. The Company will at no time close its transfer books against the
transfer of any Shares issued or issuable upon the exercise of the Warrants in a manner
that interferes with the timely exercise of the Warrants.

	                    11.6
  No Rights or Liabilities as a Stockholder. Subject to Section 6.2(a) of the Note
Purchase Agreement, this Agreement shall not entitle the Warrant Holder hereof to any
voting rights or other rights as a stockholder of the Company with respect to the Shares
prior to the exercise of the Warrants. No provision of this Agreement, in the absence of
affirmative action by the Warrant Holder to purchase the Shares, and no mere enumeration
herein of the rights or privileges of the Warrant Holder, shall give rise to any
liability of such Holder for the Exercise Price or as a stockholder of the Company,
whether such liability is asserted by the Company or by creditors of the Company.

	                    11.7
  Successors. All the covenants and provisions of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and permitted
assigns and transferees.

 
	 	
9	 

 

 

	                    11.8
  Severability. If any provision of this Agreement shall be held to be invalid and
unenforceable, such invalidity or unenforceability shall not affect any other provision
of this Agreement.

	[SIGNATURE PAGE FOLLOWS]

 
	 	
10	 

 

 

	          IN
WITNESS WHEREOF, the undersigned have caused this Agreement to be executed as of
the date first written above.

	 	THE IMMUNE RESPONSE CORPORATION

	 	By: ___________________________________

            Name:_______________________________

            Title:________________________________

	 	CHESHIRE ASSOCIATES LLC

	 	By: ___________________________________

             Name:______________________________

             Title:_______________________________

 
	 	
11	 

 

 

	EXHIBIT A

	NOTICE OF EXERCISE

	(To be signed only on exercise of
any of the Warrants)

	                    Dated:________________________

	                    To:
The Immune Response Corporation

	                   The
      undersigned, pursuant to the provisions set forth in the attached Warrant
      Agreement, hereby irrevocably elects to (check one of the following):

	                    [_] 
      purchase ____________ shares of Common Stock covered by such Warrant Agreement
      and herewith makes a cash payment of $_____________, representing the full
      purchase price for such shares at the price per share provided for in such
      Warrant Agreement.

	                    [_]
       purchase ____________ shares of Common Stock covered by such Warrant
      Agreement and herewith delivers ___________ shares of Common Stock having
      a Fair Market Value (as defined in such Warrant Agreement) as of the last
      trading day preceding the date hereof, of $______, representing the full
      purchase price for such shares at the price per share provided for in such
      Warrant Agreement.

	                    [_]
       acquire in a cashless exercise _____ shares of Common Stock pursuant
      to the terms of Section 2.1 of such Warrant Agreement.

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

	Signature:___________________________

	Name (print):________________________

	Title (if applicable):____________________

	Company (if applicable):_________________

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