Document:

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THE SECURITIES REPRESENTED BY THIS WARRANT CERTIFICATE AND THE SHARES OF STOCK
ISSUABLE UPON EXERCISE HEREOF HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY
SECURITIES LAWS OF A STATE OR OTHER JURISDICTION AND MAY NOT UNDER ANY
CIRCUMSTANCES BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF (OTHER THAN TO AN
AFFILIATE OR AS OTHERWISE PERMITTED BY THIS WARRANT CERTIFICATE PURSUANT TO
WHICH THEY WERE ISSUED) EXCEPT PURSUANT TO (i) AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES OR BLUE SKY LAWS, OR
(ii) TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER
THE ACT RELATING TO THE DISPOSITION OF SECURITIES) TOGETHER WITH AN OPINION OF
COUNSEL SATISFACTORY TO GENEREX BIOTECHNOLOGY CORPORATION THAT REGISTRATION IS
NOT REQUIRED UNDER THE ACT OR APPLICABLE STATE SECURITIES LAWS.

                        GENEREX BIOTECHNOLOGY CORPORATION

                           WARRANT TO PURCHASE SHARES
                                 OF COMMON STOCK

                  THIS CERTIFIES THAT, for value received, Elan International
Services, Ltd., a Bermuda exempted limited liability company, or its permitted
transferees and successors as provided herein (each, a "Holder"), is entitled to
subscribe for and purchase up to 75,000 shares, as adjusted pursuant to Section
4 (the "Shares"), of the fully paid and nonassessable common stock, par value
U.S.$.001 per share (the "Common Stock"), of Generex Biotechnology Corporation,
a Delaware corporation (the "Company"), at the price per share equal to a 125%
premium over the Original Issue Date Base Price (as defined below) (such price,
and such other prices that shall result from time to time, from the adjustments
specified in Section 4, the "Warrant Price"), subject to the provisions and upon
the terms and conditions hereinafter set forth. The "Original Issue Date Base
Price" shall mean the average closing price per share of publicly traded shares
of Common Stock over the sixty day period immediately preceding the date of this
Warrant (the "Closing Date") as reported on the Nasdaq National Market System or
a national securities exchange. The Warrant Price shall be equal to $25.15 per
share.

                  1. Term. Subject to the limitations set forth in Sections 3
and 4, the purchase right represented by this Warrant is exercisable, in whole
or in part, at any time, and from time to time, from and after the date hereof
and until 5:00 p.m. Eastern Standard Time, January 16, 2007. To the extent not
exercised at 5:00 p.m. Eastern Standard Time on January 16, 2007, this Warrant
shall completely and automatically terminate and expire, and thereafter it shall
be of no force or effect.

<PAGE>

                  2. Method of Exercise; Payment; Issuance of New Warrant. (a)
The purchase right represented by this Warrant may be exercised by the Holder,
in whole or in part and from time to time, by the surrender of this Warrant
(with the notice of exercise form attached hereto as Annex A duly executed) at
the principal office of the Company and by the payment to the Company of an
amount, at the option of the Holder, (i) in cash or other immediately available
funds, (ii) by the surrender of this Warrant (or a portion hereof) in accordance
with the terms hereof but without payment in cash (a "Cashless Exercise") or
(iii) with any combination of (i) and (ii). The number of shares of Common Stock
issuable in respect of a Cashless Exercise shall be computed using the following
formula:

                           X = Y (A-B)
                               -------
                                  A

         Where:                             X = the number of shares of Common
                                            Stock to be  issued to the Holder in
                                            respect of a Cashless Exercise

                                            Y = the number of shares of Common
                                            Stock purchasable under the Warrant
                                            or, if only a portion of the Warrant
                                            is being exercised, the portion of
                                            the Warrant being canceled in
                                            connection with such Cashless
                                            Exercise (at the date of such
                                            calculation)

                                            A = the Fair Market Value (as
                                            defined below) of one share of the
                                            Company's Common Stock (at the date
                                            of such calculation)

                                            B = Warrant Price (as adjusted to
                                            the date of such calculation)

                  The "Fair Market Value" of one share of Common Stock shall be
determined by the Company's Board of Directors in good faith and certified in a
Board resolution (taking into account the most recently or concurrently
completed arm's length transaction between the Company and an unaffiliated third
party the closing of which occurs within the six months preceding or on the date
of such calculation, if any) and shall be reasonably agreed to by the Holder
(provided, that in the event the Company and the Holder do not agree on the Fair
Market Value, the parties shall jointly appoint an independent third party to
determine the Fair Market Value); provided, however, that in the event the
Common Stock is traded on a securities exchange, the Nasdaq National Market or
the Nasdaq SmallCap Market, the Fair Market Value shall be deemed to be the
average of the closing sale prices for the Common Stock over the fifteen (15)
day trading period (or such shorter period for which closing sale prices are
available if the Common Stock commenced trading during such period) ending on
the trading day prior to the date of exercise of this Warrant.

                                       -2-

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                  (b) The persons or entities in whose name(s) any
certificate(s) representing Shares shall be issuable upon exercise of this
Warrant shall be deemed to have become the holder(s) of record of, and shall be
treated for all purposes as the record holder(s) of, the Shares represented
thereby (and such Shares shall be deemed to have been issued) immediately prior
to the close of business on the date or dates upon which this Warrant is
properly exercised and full payment for the Shares acquired pursuant to such
exercise is made. Upon any exercise of the rights represented by this Warrant,
certificates for the Shares purchased shall be delivered to the holder hereof as
soon as possible and in any event within 30 days of receipt of such notice and
payment, and unless this Warrant has been fully exercised or expired, a new
Warrant representing the portion of Shares, if any, with respect to which this
Warrant shall not then have been exercised shall also be issued to the holder
hereof as soon as possible and in any event within such 30-day period.

                  3. Stock Fully Paid, Reservation of Shares. All Shares that
may be issued upon the exercise of this Warrant will, upon issuance, be duly and
validly authorized and issued, fully paid and nonassessable, and will be free
from all transfer taxes (except for taxes resulting from the issuance of shares
to a person other than the Holder), liens and charges with respect to the issue
thereof and assuming payment of the Warrant Price for all Shares so purchased,
legally and validly owned by the Holder. During the period within which this
Warrant may be exercised, the Company will at all times have authorized, and
reserved for the purpose of the issue upon the exercise of the purchase rights
evidenced by this Warrant, a sufficient number of shares of its Common Stock to
provide for the exercise of the rights represented by this Warrant.

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

                  (a) Reclassification, Etc. In case of (i) any
reclassification, reorganization, change or conversion of securities of the
class issuable upon exercise of this Warrant (other than a change in par value,
or from par value to no par value) into other shares or securities of the
Company, or (ii) any merger or consolidation of the Company with or into another
entity (other than a merger or consolidation with another entity in which the
Company is the acquiring and the surviving entity and that does not result in
any reclassification or change of outstanding securities issuable upon exercise
of this Warrant), or (iii) any sale of all or substantially all the assets of
the Company, then the Company, or such successor or purchasing entity, as the
case may be, shall duly execute and deliver to the holder of this Warrant a new
Warrant or a supplement hereto (in form and substance reasonably satisfactory to
the holder of this Warrant), so that the Holder shall have the right to receive,
at a total purchase price not to exceed that payable upon the exercise of the
unexercised portion of this Warrant, and in lieu of the shares of Common Stock
theretofore issuable upon the exercise of this Warrant, the kind and amount of
shares of stock and other securities, receivable upon such reclassification,
reorganization, change or conversion by a holder of the number of shares of

                                       -3-
<PAGE>

Common Stock then purchasable under this Warrant. Such new Warrant shall provide
for adjustments that shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Section 4. The provisions of this Section 4(a)
shall similarly attach to successive reclassifications, reorganizations,
changes, and conversions.

                  (b)  Stock Dividends; Etc.
                       --------------------

                    (i) If at any time prior to the earlier of the exercise or
         expiration hereof the Company shall fix a record date for the
         effectuation of a split or subdivision of the outstanding shares of
         Common Stock or the determination of holders of Common Stock entitled
         to receive a dividend or other distribution payable in additional
         shares of Common Stock or other securities or property or rights
         convertible into, or entitling the holder thereof to receive directly
         or indirectly, any of the foregoing (hereinafter referred to as "Common
         Stock Equivalents") without payment of any consideration by such holder
         for the additional shares of Common Stock or the Common Stock
         Equivalents (including the additional shares of Common Stock issuable
         upon conversion or exercise thereof) or with payment that is less than
         the lower of (x) the then-Fair Market Value of the Common Stock
         (including, in the case of Common Stock Equivalents, on an as-converted
         basis) and (y) the Warrant Price then in effect, then and in each case,
         this Warrant shall be for, in addition to the number of shares of the
         Common Stock otherwise deliverable upon exercise of this Warrant, and
         without adjustment to the Warrant Price, the amount of such additional
         shares of Common Stock and any Common Stock Equivalents that the holder
         hereof would have received or become entitled to receive on the same
         terms and conditions as if such holder had been a holder of record of
         such Common Stock as shall have been deliverable immediately prior to
         such record date pursuant to the terms of this Section 4; provided that
         the upon the exercise, in addition to the Warrant Price, the Holder
         shall pay any consideration which would have been payable for such
         Common Stock or Common Stock Equivalents.

                   (ii) If the Company at any time during which this Warrant
         remains outstanding and unexpired shall subdivide or combine its Common
         Stock, (A) in the case of a subdivision, the Warrant Price shall be
         proportionately decreased and the number of Shares purchasable
         hereunder shall be proportionately increased, and (B) in the case of a
         combination, the Warrant Price shall be proportionately increased and
         the number of Shares purchasable hereunder shall be proportionately
         decreased.

                  (c) Other Distributions. In the event the Company shall
declare a distribution payable in securities of other persons, evidences of
indebtedness issued by the Company or other persons, assets, cash (excluding
cash dividends declared out of retained earnings) or options or rights not
referred to in the previous subsection (b), then, in each such case for the
purpose of this subsection (c), upon exercise of this Warrant, the Holder shall
be entitled to a proportionate share of any such distribution as though such

                                       -4-

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Holder was a holder of the number of shares of Common Stock of the Company into
which this Warrant would be convertible as of the record date fixed for the
determination of the holders of Common Stock of the Company entitled to receive
such distribution.

                  (d) No Impairment. The Company will not, by amendment of its
Certificate of Incorporation or bylaws or through any reorganization,
recapitalization, transfer of assets, consolidation, merger, dissolution, issue
or sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms to be observed or performed
hereunder by the Company, but will at all times in good faith assist in the
carrying out of all the provisions of this Section 4 and in the taking of all
such action as may be necessary or appropriate in order to protect the rights of
the Holder against impairment.

                  (e) Notice of Adjustments. Whenever the Warrant Price or the
number of Shares purchasable hereunder shall be adjusted pursuant to this
Section 4, the Company shall prepare a certificate setting forth, in reasonable
detail, the event requiring the adjustment, the amount of the adjustment, the
method by which such adjustment was calculated. Such certificate shall be signed
by its chief financial officer and shall be delivered to the Holder.

                  (f) Fractional Shares. No fractional shares of Common Stock
will be issued in connection with any exercise hereunder, but in lieu of such
fractional shares the Company shall make a cash payment therefor based on the
fair market value of the Common Stock on the date of exercise as reasonably
determined in good faith by the Company's Board of Directors.

                  (g) Cumulative Adjustments. No adjustment in the Warrant Price
shall be required under this Section 4 until cumulative adjustments result in a
concomitant change of 1% or more of the Warrant Price or in the number of shares
of Common Stock purchasable upon exercise of this Warrant as in effect prior to
the last such adjustment; provided, however, that any adjustment that by reason
of this Section 4 are not required to be made shall be carried forward and taken
into account in any subsequent adjustment. All calculations under this Section 4
shall be made to the nearest cent or to the nearest one-hundredth of a share, as
the case may be.

                  5. Compliance with Securities Act; Disposition of Warrant or
Shares of Common Stock.

                  (a) The Holder, by acceptance hereof, agrees that this Warrant
and the Shares to be issued upon exercise hereof are being acquired for
investment and that such holder will not offer, sell or otherwise dispose of
this Warrant or any Shares to be issued upon exercise hereof except under
circumstances which will not result in a violation of applicable securities laws
and which are in compliance with the provisions of the legend set forth below.
Upon exercise of this Warrant, unless the Shares being acquired are registered
under the Securities Act of 1933, as amended (the "Act"), or an exemption from
the registration requirements of such Act is available, the Holder shall confirm

                                       -5-
<PAGE>

in writing, by executing an instrument in form reasonably satisfactory to the
Company, that the Shares so purchased are being acquired for investment and not
with a view toward distribution or resale and that the Holder is an accredited
investor, as defined in Regulation D under the Act. This Warrant and all Shares
issued upon exercise of this Warrant (unless registered under the Act) shall be
stamped or imprinted with a legend in substantially the following form:

         "THE SECURITIES REPRESENTED BY THIS WARRANT CERTIFICATE AND THE SHARES
         OF STOCK ISSUABLE UPON EXERCISE HEREOF HAVE BEEN ACQUIRED FOR
         INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
         1933, AS AMENDED (THE "ACT"), OR ANY SECURITIES LAWS OF A STATE OR
         OTHER JURISDICTION AND MAY NOT UNDER ANY CIRCUMSTANCES BE SOLD,
         TRANSFERRED OR OTHERWISE DISPOSED OF (OTHER THAN TO AN AFFILIATE OR AS
         OTHERWISE PERMITTED BY THIS WARRANT CERTIFICATE PURSUANT TO WHICH THEY
         WERE ISSUED) EXCEPT PURSUANT TO (i) AN EFFECTIVE REGISTRATION STATEMENT
         UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES OR BLUE SKY LAWS, OR
         (ii) TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR
         RULE UNDER THE ACT RELATING TO THE DISPOSITION OF SECURITIES) TOGETHER
         WITH AN OPINION OF COUNSEL SATISFACTORY TO GENEREX BIOTECHNOLOGY
         CORPORATION THAT REGISTRATION IS NOT REQUIRED UNDER THE ACT OR
         APPLICABLE STATE SECURITIES LAWS."

                  (b)

                    (i) This Warrant may be transferred or assigned, in whole or
         in part, by Elan International Services, Ltd. to its affiliates and
         subsidiaries, including any special purpose financing or similar
         vehicle affiliate. Other than as set forth in the preceding sentence,
         this Warrant may not be transferred or assigned by either party without
         the prior written consent of the other. Subject to the foregoing, this
         Warrant and all of the provisions hereof shall be binding upon and
         inure to the benefit of the parties hereto and their respective
         successors and permitted assigns; provided, however, that the
         transferor and the Company shall continue to be liable and obligated
         for their respective obligations hereunder after any such assignment.

                   (ii) With respect to any offer, sale or other disposition of
         this Warrant or any Shares acquired pursuant to the exercise of this
         Warrant prior to registration of such Shares, the Holder shall give
         written notice to the Company prior thereto, describing briefly the
         manner thereof, together with a written opinion of counsel reasonably

                                       -6-

<PAGE>

         acceptable to the Company (as to content of such opinion and the
         identity of such counsel), if requested by the Company, to the effect
         that such offer, sale or other disposition may be effected without
         registration or qualification (under the Securities Act as then in
         effect or any federal or state law then in effect) of this Warrant or
         such Shares and indicating whether or not under the Act certificates
         for this Warrant or such Shares to be sold or otherwise disposed of
         require any restrictive legend as to applicable restrictions on
         transferability in order to ensure compliance with the Act. In
         addition, the Company may, upon the reasonable advice of its counsel,
         require the prospective transferee to execute documentation verifying
         as to the transferees investment intent and status as an accredited
         investor. Promptly upon receiving such written notice, reasonably
         satisfactory opinion and other materials as to investment intent and
         status, if so requested, the Company, as promptly as practicable, shall
         notify such Holder that such Holder may sell or otherwise dispose of
         this Warrant or such Shares, all in accordance with the terms of the
         notice delivered to the Company. Each certificate representing this
         Warrant or the Shares thus transferred shall bear a legend as to the
         applicable restrictions on transferability in order to insure
         compliance with the Securities Act, unless in the aforesaid opinion of
         counsel for the Holder such legend is not required in order to insure
         compliance with the Securities Act. The Company may issue stop transfer
         instructions to its transfer agent in connection with such
         restrictions.

                  (iii) The shares of Common Stock for which this Warrant is
         exercisable are entitled to the benefit of certain registration rights
         as set forth in a Registration Rights Agreement dated as of the date
         hereof between the Company and the initial Holder named herein.

                  6. Rights as Shareholders. No Holder, as such, shall be
entitled to vote or receive dividends or be deemed the holder of Shares or any
other securities of the Company which may at any time be issuable on the
exercise hereof for any purpose, nor shall anything contained herein be
construed to confer upon the Holder, as such, any right to vote for the election
of directors or upon any matter submitted to shareholders at any meeting
thereof, or to receive notice of meetings, or to receive dividends or
subscription rights or otherwise until this Warrant is exercised and the Shares
purchasable upon the exercise hereof shall have become deliverable, as provided
herein.

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

                  (a) The Company has all requisite corporate power and
authority to authorize and execute this Warrant and the certificates evidencing
the Shares and to perform all obligations and undertakings under this Warrant
and the certificates evidencing the Shares;

                  (b) This Warrant has been duly authorized and executed by the
Company and is a valid and binding obligation of the Company enforceable in
accordance with its terms;

                                       -7-

<PAGE>

                  (c) The Shares have been duly authorized and reserved for
issuance by the Company and, when issued in accordance with the terms hereof,
will be validly issued, fully paid and nonassessable; and

                  (d) The execution and delivery of this Warrant are not, and
the issuance of the Shares upon exercise of this Warrant in accordance with the
terms hereof will not be, inconsistent with the Company's Certificate of
Incorporation or bylaws, as amended, and do not and will not constitute a
default under, any indenture, mortgage, contract or other instrument of which
the Company is a party or by which it is bound.

                  8. Miscellaneous. (a) This Warrant may not be modified or
amended, or any provisions hereof waived, except by written agreement of the
Company and the Holder.

                  (b) All notices, demands and requests of any kind to be
delivered to any party in connection with this Note shall be in writing and
shall be deemed to have been duly given if personally or hand delivered or if
sent by an internationally-recognized overnight delivery courier or by
registered or certified mail, return receipt requested and postage prepaid, or
by facsimile transmission addressed as follows:

           (i)    if to the Company, to:

                         Generex Biotechnology Corporation
                         32 Harbour Square
                         Suite 202
                         Toronto Ontario Canada
                         Attention:  Chief Executive Officer
                         Facsimile:  (416) 364-9363

                  with a copy to:

                         Eckert Seamans Cherin Mellot
                         1515 Market Street
                         9th Floor
                         Philadelphia, PA 19102
                         Attention:  John G. Chou
                         Facsimile:  (215) 851-8383

                                       -8-

<PAGE>

          (ii)    if to EIS, to:

                         Elan International Services, Ltd.
                         102 St. James Court
                         Flatts, Smiths Parish
                         Bermuda FL 04
                         Attention:  Chief Executive Officer
                         Facsimile:  (441) 292-2224

                  with a copy to:

                           Cahill Gordon & Reindel
                           80 Pine Street
                           New York, NY 10005
                           Attention:  William M. Hartnett
                           Facsimile:  (212) 269-5420

                  (c) The Company covenants to the Holder that upon receipt of
evidence reasonably satisfactory to the Company of the loss, theft, destruction
or mutilation of this Warrant and, in the case of any such loss, theft or
destruction, upon receipt of a bond or indemnity reasonably satisfactory to the
Company, or in the case of any such mutilation upon surrender and cancellation
of such Warrant, the Company will make and deliver a new Warrant, of like tenor,
in lieu of the lost, stolen, destroyed or mutilated Warrant.

                  (d) The descriptive headings of the several sections and
paragraphs contained in this Warrant are for reference purposes only and shall
not affect in anyway the meaning or interpretation of this Warrant.

                  (e) This Warrant shall be governed by and construed in
accordance with the internal laws of the State of New York, without giving
effect to the principles of conflicts of laws. Any dispute under this Warrant
that is not settled by mutual consent shall be finally adjudicated by any
federal or state court sitting in the City, County and State of New York, and
the Company consents to the exclusive jurisdiction of such courts (or any
appellate court therefrom) over any such dispute.

                  (f) This Warrant may be executed in any number of
counterparts, and each such counterpart hereof shall be deemed to be an original
instrument, but all such counterparts together shall constitute one Warrant.
This Warrant may be signed and delivered to the other party by a facsimile
transmission; such transmission shall be deemed a valid signature.

                  (g) Each of the parties shall be responsible for its own costs
and expenses incurred in connection with the transactions contemplated hereby.

                            [Signature page follows]

                                       -9-
<PAGE>

                  IN WITNESS WHEREOF, the Company has executed this Warrant as
of the 16th day of January, 2001.

                                                 GENEREX BIOTECHNOLOGY
                                                 CORPORATION

                                             By: /s/ E. Mark Perri
                                                 -------------------------------
                                                 Name:   E. Mark Perri
                                                 Tittle: Chief Financial Officer

<PAGE>

                                                                         Annex A
                                                                         -------

NOTICE OF EXERCISE
------------------

To:      Generex Biotechnology Corporation

1. The undersigned hereby elects to purchase _______ shares of Common Stock of
Generex Biotechnology Corporation pursuant to the terms of the attached Warrant,
and tenders herewith full payment of the purchase price of such shares, in cash
or other immediately available funds.

                  2. Please issue a certificate or certificates representing
said shares in the name of the undersigned or in such other name or names as are
specified below:

_____________________________________________________ (Name)

_____________________________________________________

_____________________________________________________ (Address)

                  3. The undersigned represents that the aforesaid shares are
being acquired for the account of the undersigned for investment and not with a
view to, or for resale in connection with, the distribution thereof and that the
undersigned has no present intention of distributing or reselling such shares.

Signature: __________________________________________

Name: _______________________________________________

Address: ____________________________________________

         ____________________________________________

         ____________________________________________

Social Security or taxpayer identification number:

______________________________________________

                                       11<PAGE>

              CERTIFICATE OF DESIGNATIONS, PREFERENCES, AND RIGHTS
                                       of
                            SERIES A PREFERRED STOCK
                                       of
                        GENEREX BIOTECHNOLOGY CORPORATION

       (Pursuant to Section 151 of the Delaware General Corporations Law)

                  We, Anna E. Gluskin and Rose C. Perri, the President and the
Secretary, respectively, of Generex Biotechnology Corporation, a corporation
organized and existing under the Delaware General Corporation Law (the
"Corporation"), in accordance with the provisions of 151 of the Delaware General
Corporation Law thereof, DO HEREBY CERTIFY:

                  That pursuant to the authority conferred upon the Board of
Directors of the Corporation by the Certificate of Incorporation of the said
Corporation, the Board of Directors of the Corporation on January 15, 2001
adopted the following resolution, pursuant to the Corporation's Certificate of
Incorporation and Section 151(g) of the Delaware General Corporation Law,
creating one series of shares of preferred stock designated as Series A
Preferred Stock:

         "RESOLVED, that pursuant to the authority vested in the Board of
         Directors of the Corporation by the Certificate of Incorporation of the
         Corporation, the Board of Directors does hereby provide for the
         issuance of a series of preferred stock, U.S.$.001 par value per share,
         of the Corporation, to be designated "Series A Preferred Stock",
         initially consisting of up to 1,512 shares, and the Board of Directors
         of the Corporation does hereby fix and herein state and express such
         designations, powers, preferences and relative and other special rights
         and the qualifications, limitations and restrictions thereof, as
         follows:

                  1. Designation. 1,512 shares of preferred stock shall be
designated and known as the "Series A Preferred Stock." Such number of shares
may not be increased or decreased without obtaining the consent of a majority in
interest of the holder(s) of the then-outstanding shares of Series A Preferred
Stock; provided that no decrease shall reduce the number of shares of Series A
Preferred Stock to a number less than the number of shares then outstanding plus
the number of such shares issuable upon exercise of outstanding rights, options
or warrants or upon conversion of outstanding securities issued by the
Corporation.

                  2. Dividend Provisions.

                  (a) From and after the date hereof, when and if the Board of
Directors of the Corporation shall declare a dividend or distribution payable
with respect to the then-outstanding shares of Common Stock of the Corporation,
the holders of the Series A Preferred Stock shall be entitled to the amount of
dividends per share in the same form as such Common Stock dividends that would

<PAGE>

be payable on the largest number of whole shares of Common Stock into which a
holder's aggregate shares of Series A Preferred Stock could then be converted
pursuant to Section 4 hereof (such number to be determined as of the record date
for the determination of holders of Common Stock entitled to receive such
dividend).

                  (b) In addition to Section 2(a) above, each share of Series A
Preferred Stock, shall be entitled to receive a mandatory dividend equal to 6.0%
per year of the Original Issue Price (as defined below) thereof, compounded
annually on each succeeding 12 month anniversary of the first issuance. Such
dividend shall be cumulative and shall be payable annually on each succeeding 12
month anniversary of the first issuance and shall be payable solely by the
issuance of additional shares of Series A Preferred Stock at a price per share
equal to the Original Issue Price (as defined in 3(b), below) thereof and not in
cash; provided, that such dividend shall not be declared or paid to any holder
without the consent of such holder. Fractional shares of Series A Preferred
Stock shall be issuable for all purposes hereunder.

                  3. Seniority; Liquidation Preference.

                  (a) The Corporation may not issue any additional classes or
series of preferred stock with a liquidation preference, dividend or other
rights senior to the Series A Preferred Stock except pursuant to Section 14
hereof.

                  (b) In the event of any liquidation, dissolution or winding-up
of the affairs of the Corporation, whether voluntary or involuntary,
(collectively, a "Liquidation"), before any payment of cash or distribution of
other property shall be made to the holders of the Common Stock or any other
class or series of stock subordinate in liquidation preference to the Series A
Preferred Stock, the holders of the Series A Preferred Stock shall be entitled
to receive out of the assets of the Corporation legally available for
distribution to its shareholders, the Original Issue Price per share (as
appropriately adjusted for any combinations or divisions or similar
recapitalizations affecting the Series A Preferred Stock after issuance) and
accrued and unpaid dividends thereon (the "Series A Liquidation Preference"). As
used herein, the "Original Issue Price" per share is U.S.$12,015.

                  (c) If, upon any Liquidation, the assets of the Corporation
available for distribution to its shareholders shall be insufficient to pay the
holders of the Series A Preferred Stock the full amounts to which they shall be
entitled, the holders of the Series A Preferred Stock shall share ratably in any
distribution of assets in proportion to the respective amounts which would be
payable to them in respect of the shares held by them if all amounts payable to
them in respect of such were paid in full pursuant to Section 3(b).

                  (d) After the distributions described in Section 3(c) above
have been paid, subject to the rights of other series of preferred stock that
may from time to time come into existence, the remaining assets of the
Corporation available for distribution to shareholders shall be distributed
among the holders of Common Stock pro rata based on the number of shares of
Common Stock held by each.

                                        2
<PAGE>

                  4. Conversion. The holders of the Series A Preferred Stock
shall have conversion rights, through and including the Conversion Termination
Date (as defined below), as follows (the "Conversion Rights"):

                  (a) Right to Convert.

                  (i) Each share of Series A Preferred Stock shall be
         convertible, at the option of the holder thereof, at any time that is
         three (3) years after the issuance thereof, at the office of the
         Corporation or any transfer agent for such stock, into such number of
         fully paid and non-assessable shares of Common Stock as is determined
         by dividing (x) the aggregate outstanding liquidation preference and
         accrued dividends (the "Outstanding Amount") by (y) the Series A
         Conversion Price (as defined below). The "Series A Conversion Price"
         shall be a price per share that represents a 130% premium over the
         average closing price per share of publicly traded shares of Common
         Stock over the sixty day period immediately preceding the Original
         Issue Date (such average closing price hereinafter referred to as the
         "Original Issue Date Base Price"); provided the Series A Conversion
         Price shall be subject to adjustment as set forth below in this Section
         4(a). The Series A Preferred Stock may be convertible at the option of
         the Corporation any time in the event of any merger, consolidation or
         acquisition of or involving the Corporation (a "Significant
         Transaction"), subject to the receipt of any applicable regulatory
         approvals. Notwithstanding the above, the Series A Preferred Stock, in
         the event that there shall occur a merger or consolidation of the
         Corporation with or into another entity as a consequence of which Elan
         International Services, Ltd. and its affiliates ("EIS") shall own 50%
         or less of the equity (on a fully diluted basis) of the survivor of
         such merger or consolidation than EIS did of the Corporation prior
         thereto or the consummation of an initial public offering of the
         Corporation's Common Stock, then, in any such event, the outstanding
         shares of the Series A Preferred Stock then held by the original holder
         of the Series A Preferred Stock or any of its affiliates shall,
         immediately prior to the consummation thereof, be at the option of the
         Corporation converted into the same number of shares of Common Stock
         into which such shares are convertible pursuant to this Section 4(a)(i)
         (a "Required Conversion"); provided, further, in the event of a
         Required Conversion, the Common Stock delivered upon such conversion
         shall have the benefit of the Exchange Right identical to that with
         respect to the Series A Preferred Stock on the date of conversion so
         converted and shall be evidenced by a security substantially in the
         form attached to the definitive agreement providing for the initial
         issuance of shares of Series -A Preferred Stock.

                  (ii) Before any holder of Series A Preferred Stock shall be
         entitled to convert such shares into shares of Common Stock, such
         holder shall surrender the certificate or certificates therefor, duly

                                        3
<PAGE>

         endorsed, at the office of the Corporation or of any transfer agent for
         the Series A Preferred Stock, and shall give written notice to the
         Corporation at its principal corporate office, of the election to
         convert the same and shall state therein the name or names in which the
         certificate or certificates for shares of Common Stock are to be
         issued. The Corporation shall, as soon as practicable thereafter, issue
         and deliver at such office to such holder of Series A Preferred Stock,
         or to the nominee or nominees of such holder, a certificate or
         certificates for the number of shares of Common Stock to which such
         holder shall be entitled as set forth above. Such conversion shall be
         deemed to have been made immediately prior to the close of business on
         the date of such surrender of the shares of Series A Preferred Stock to
         be converted, and the person or persons entitled to receive the shares
         of Common Stock issuable upon such conversion shall be treated for all
         purposes as the record holder or holders of such shares of Common Stock
         as of such date.

                  (iii) In the event the Corporation should at any time fix a
         record date for the effectuation of a split or subdivision of the
         outstanding shares of Common Stock or the determination of holders of
         Common Stock entitled to receive a dividend or other distribution
         payable in additional shares of Common Stock or other securities or
         property or rights convertible into, or entitling the holder thereof to
         receive directly or indirectly, any of the foregoing (hereinafter
         referred to as "Common Stock Equivalents") without payment of any
         consideration by such holder for the additional shares of Common Stock
         or the Common Stock Equivalents (including the additional shares of
         Common Stock or other securities or property issuable upon conversion
         or exercise thereof) or with payment that is less than the lower of (x)
         the then-Fair Market Value price of the Common Stock (including, in the
         case of Common Stock Equivalents, on an as-converted basis) and (y) the
         Series A Conversion Price then in effect, then and in each case with
         respect to each share of Series A Preferred Stock, the Conversion Right
         shall be for, in addition to the number of shares of the Common Stock
         otherwise deliverable upon exercise of the Conversion Right, and
         without adjustment to the Series A Conversion Price, the amount of such
         additional shares of Common Stock and any Common Stock Equivalents that
         the holder of such share of Series A Preferred Stock would have
         received or become entitled to receive on the same terms and conditions
         as if such holder had been a holder of record of such Common Stock as
         shall have been deliverable immediately prior to such record date
         pursuant to the terms of this Section 4. The "Fair Market Value" of one
         share of Common Stock shall be determined by the Corporation's Board of
         Directors in good faith (taking into account the most recently or
         concurrently completed arm's length transaction between the Corporation
         and an unaffiliated third party the closing of which occurs within the
         six months preceding or on the date of such calculation, if any) and
         shall be reasonably agreed to by the majority of the holders of the
         Series A Preferred Stock (provided, that in the event the Corporation
         and the majority of holders of the Series A Preferred Stock do not
         agree on the Fair Market Value, the parties shall jointly appoint an
         independent third party to determine the Fair Market Value); provided,

                                        4
<PAGE>

         however, that in the event the Common Stock is traded on a securities
         exchange, the Nasdaq National Market or the Nasdaq SmallCap Market, the
         Fair Market Value shall be deemed to be the average of the closing sale
         prices for the Common Stock over the 30-day period (or such shorter
         period for which closing sale prices are available if the Common Stock
         commenced trading during such period) ending the trading day prior to
         (x) the record date referred to in this paragraph (iv) or (y) with
         respect to Section 6 hereof, the redemption date.

                  (iv) If the Corporation at any time during which any share of
         Series A Preferred Stock remains outstanding shall subdivide or combine
         its Common Stock, (A) in the case of a subdivision, the Series A
         Conversion Price shall be proportionately decreased and the number of
         shares of Common Stock purchasable thereunder shall be proportionately
         increased, and (B) in the case of a combination, the Series A
         Conversion Price shall be proportionately increased and the number of
         shares of Common Stock purchasable thereunder shall be proportionately
         decreased.

                  (v) In case of (A) any reclassification, reorganization,
         change or conversion of securities of the class issuable upon
         conversion of the Series A Preferred Stock (other than a change in par
         value, or from par value to no par value) into other shares or
         securities of the Corporation, or (B) any consolidation of the
         Corporation with or into another entity (other than a merger or
         consolidation with another entity in which the Corporation is the
         acquiring and the surviving entity and that does not result in any
         reclassification or change of outstanding securities issuable upon
         conversion of the Series A Preferred Stock), or (C) any sale of all or
         substantially all the assets of the Corporation, each holder of shares
         of Series A Preferred Stock shall have the right to receive, in lieu of
         the shares of Common Stock otherwise issuable upon the conversion of
         its shares of Series A Preferred Stock and accumulated and unpaid
         dividends then-outstanding thereunder, the kind and amount of shares of
         stock and other securities, money and property receivable upon such
         reclassification, reorganization, change, merger, consolidation or
         conversion by a holder of the number of shares of Common Stock then
         issuable under the Series A Preferred Stock. The provisions of this
         Section 4(a)(v) shall similarly attach to successive reclassifications,
         reorganizations, changes, and conversions.

                  (b) In order to exercise the Conversion Right, a holder shall
provide written notice thereof to the Corporation, setting forth (a) the fact
that such holder intends to exercise the Conversion Right, and (b) the proposed
date for such exercise (the "Conversion Date"), which shall be between 10 and 30
days after the date of such notice; provided, however, that if the Corporation
shall deliver the holders a written request to delay the date for such exercise
by no more than 45 days, the Conversion Date will be as set forth in that
request. On the Conversion Date, (y) the holder shall tender its shares of
Series A Preferred Stock to the Corporation for cancellation free and clear of
encumbrances of any type or nature, and (z) the Corporation shall cause to be

                                        5
<PAGE>

delivered to such holder, such shares of Common Stock free and clear of
encumbrances of any type or nature. The holders and the Corporation shall take
all other necessary or appropriate actions in connection with or to effect such
closing.

                  5. Exchange Right. The original purchaser (or any of its
affiliates) of the Series A Preferred Stock shall have the right to exchange
(the "Exchange Right") all of the shares of Series A Preferred Stock, including
shares of Series A Preferred Stock paid as dividends with respect thereto, of
the Corporation for 3,612 shares of non-voting convertible preferred shares
("Preferred Shares") (as adjusted for any combinations or divisions or similar
recapitalizations) of Generex (Bermuda), Ltd., a Bermuda exempted limited
liability company ("Newco"), held by the Corporation and which are convertible
into 30.1% (subject to potential dilution resulting from issuance of additional
Common Shares of Newco (the "Common Shares, and together with the Preferred
Shares, the "Shares") after the Closing Date) of the aggregate issued and
outstanding Shares, so that after giving effect to the conversion thereof EIS
shall initially own 50% (subject to potential dilution resulting from issuance
of additional Common Shares after the Closing Date) of the then-issued and
outstanding Shares. The "Closing Date" is the date of closing if the transaction
pursuant to which shares of Series A Preferred Stock will initially be issued.

                  Upon exercise of the Exchange Right, all shares of Series A
Preferred Stock originally purchased from the Corporation, including shares of
Series A Preferred Stock paid as dividends with respect thereto, shall be
canceled and shall no longer be entitled to any rights in the Corporation. In
the event of such an exchange, any and all accrued and unpaid dividends shall
not be declared payable and shall not be due.

                  Other than in the case of a Required Conversion, if any shares
of the Series A Preferred Stock are converted pursuant to Section 4(a), to
shares of Common Stock, the Exchange Right with respect to the shares of Series
A Preferred Stock originally purchased from the Corporation shall be canceled
and shall no longer be entitled to any rights in the Corporation.

                  In order to exercise the Exchange Right, the holders shall
provide written notice thereof to the Corporation, setting forth (a) the fact
that such holders intend to exercise the Exchange Right, and (b) the proposed
date for such exercise (the "Exercise Date"), which shall be between 10 and 30
days after the date of such notice; provided, however, that if the Corporation
shall deliver the holders a written request to delay the date for such exercise
by no more than 45 days, the Exercise Date will be as set forth in that request.
On the Exercise Date, (y) the holders shall tender their shares of Series A
Preferred Stock to the Corporation for cancellation free and clear of
encumbrances of any type or nature, and (z) the Corporation shall cause to be
delivered to EIS, acting on behalf of such holders, such shares of Newco free
and clear of encumbrances of any type or nature. The holders and the Corporation
shall take all other necessary or appropriate actions in connection with or to
effect such closing.

                                        6
<PAGE>

                  6. Redemption.

                  (a) To the extent the Corporation shall have funds legally
available for such payment, on January 16, 2007, if any shares of the Series A
Preferred Stock shall be outstanding, the Corporation shall redeem all
outstanding shares of the Series A Preferred Stock, at a redemption price equal
to the aggregate Series A Liquidation Preference, either (a) in cash, or (b) in
shares of Common Stock with a Fair Market Value equal to such redemption price,
in each case together with any accrued and unpaid dividends thereon to the date
fixed for redemption, without interest.

                  (b) In the event the Corporation shall redeem shares of Series
A Preferred Stock pursuant to Section 6(a), notice of such redemption shall be
given by first class mail, postage prepaid, mailed not less than 10 days nor
more than 20 days prior to the redemption date, to each holder of record of the
shares to be redeemed at such holder's address as the same appears on the stock
register of the Corporation; provided that neither the failure to give such
notice nor any defect therein shall affect the validity of the giving of notice
for the redemption of any share of Series A Preferred Stock to be redeemed
except as to the holder to whom the Corporation has failed to give said notice
or except as to the holder whose notice was defective. Each such notice shall
state: (i) the redemption date; (ii) the number of shares of Series A Preferred
Stock to be redeemed; (iii) the redemption price and the Fair Market Value of
the Common Stock, if applicable; (iv) the place or places where certificates for
such shares are to be surrendered for payment of the redemption price; and (v)
that dividends on the shares to be redeemed will cease to accrue on such
redemption date

                  (c) In the case of any redemption pursuant to Sections 6(a)
hereof, notice having been mailed as provided in Section 6(a) hereof, from and
after the redemption date (unless default shall be made by the Corporation in
providing money for the payment of the redemption price of the shares called for
redemption), dividends on the shares of Series A Preferred Stock so called for
redemption shall cease to accrue, and all rights of the holders thereof as
stockholders of the Corporation (except the right to receive from the
Corporation the redemption price) shall cease. Upon surrender in accordance with
said notice of the certificates for any shares so redeemed (properly endorsed or
assigned for transfer, if the Board of Directors of the Corporation shall so
require and the notice shall so state), such share shall be redeemed by the
Corporation at the redemption price aforesaid. In case fewer than all the shares
represented by any such certificate are redeemed, a new certificate shall be
issued representing the unredeemed shares without cost to the holder thereof.

                  7. Other Distributions. In the event the Corporation shall
declare a distribution payable in securities of other persons, evidences of
indebtedness issued by the Corporation or other persons, assets, cash (excluding
cash dividends declared out of retained earnings and excluding cash dividends to
which holders of Series A Preferred are entitled under Section 2(a) of this
Certificate of Designations) or options or rights not referred to in Section 4,
then, in each such case for the purpose of this Section 7, the holders of the

                                        7
<PAGE>

Series A Preferred Stock shall be entitled to a proportionate share of any such
distribution as though they were the holders of the number of shares of Common
Stock of the Corporation into which their shares of Series A Preferred Stock
would be convertible as of the record date fixed for the determination of the
holders of Common Stock of the Corporation entitled to receive such
distribution.

                  8. Recapitalizations. If at any time or from time to time
there shall be a recapitalization of the Common Stock (other than a subdivision,
combination or merger or sale of assets provided for in Section 4 hereof)
provision shall be made so that the holders of the Series A Preferred Stock
shall thereafter be entitled to receive upon conversion of the Series A
Preferred Stock the number of shares of stock or other securities or property of
the Corporation or otherwise, to which a holder of Common Stock deliverable upon
conversion would have been entitled on such recapitalization. In any such case,
appropriate adjustment shall be made in the application of the provisions of
Section 4 with respect to the rights of the holders of the Series A Preferred
Stock after the recapitalization to the end that the provisions of Section 4
(including adjustment of the Series A Conversion Price then in effect and the
number of shares purchasable upon conversion of the Series A Preferred Stock)
shall be applicable after that event as nearly equivalent as may be practicable.

                  9. No Impairment.

                  (a) The Corporation will not, by amendment of its Certificate
of Incorporation or through any reorganization, recapitalization, transfer of
assets, consolidation, merger, dissolution, issuance or sale of securities or
any other voluntary action, avoid or seek to avoid the observance or performance
of any of the terms to be observed or performed hereunder by the Corporation,
but will at all times in good faith assist in the carrying out of all the
provisions hereof and in the taking of all such action as may be necessary or
appropriate in order to protect the Series A Conversion Rights, Exchange Right
and redemption rights of the holders of the Series A Preferred Stock against
impairment.

                  (b) If the Corporation is unable or shall fail to discharge
its obligations under Section 5 or Section 6(a) (an "Obligation"), such
Obligation shall be discharged as soon as the Corporation is able to discharge
such Obligation. If and so long as any Obligation with respect to the Series A
Preferred Stock shall not be fully discharged, the Corporation shall not (i)
directly or indirectly, redeem, purchase, or otherwise acquire any classes or
series of preferred stock with a liquidation preference, dividend or other
rights senior to the Series A Preferred Stock ("Senior Stock") or discharge any
mandatory or optional redemption, sinking fund or other similar obligation in
respect of any Senior Stock (except in connection with a redemption, sinking
fund or other similar obligation to be satisfied pro rata with the Series A
Preferred Stock) or (ii) declare or make any distribution to any classes or
series of preferred stock with a liquidation preference, dividend or other
rights junior to the Series A Preferred Stock or any other securities which rank
junior to the Series A Preferred Stock ("Junior Securities"), or, directly or

                                        8
<PAGE>

indirectly, discharge any mandatory or optional redemption, sinking fund or
other similar obligation in respect of the Junior Securities.

                  10. No Fractional Shares and Certificate as to Adjustments.

                  (a) No fractional shares shall be issued upon the conversion
of any share or shares of the Series A Preferred Stock, and the number of shares
of Common Stock to be issued shall be rounded to the nearest whole share.
Whether or not fractional shares are issuable upon such conversion shall be
determined on the basis of the aggregate number of shares of Series A Preferred
Stock each holder is at the time converting into Common Stock and the aggregate
number of shares of Common Stock issuable to each such holder upon such
conversion.

                  (b) Upon the occurrence of each adjustment or readjustment of
the Series A Conversion Price pursuant to Section 4, the Corporation, at its
expense, shall promptly compute such adjustment or readjustment in accordance
with the terms hereof and prepare and furnish to each holder of shares of Series
A Preferred Stock a certificate setting forth such adjustment or readjustment
and showing in detail the facts upon which such adjustment or readjustment is
based. The Corporation shall, upon the written request at any time of any holder
of Series A Preferred Stock, furnish or cause to be furnished to such holder a
like certificate setting forth (i) such adjustment and readjustment, (ii) the
Series A Conversion Price at the time in effect, and (iii) the number of shares
of Common Stock and the amount, if any, of other property which at the time
would be received upon the conversion of a share of Series A Preferred Stock.

                  11. Reservation of Stock Issuable Upon Conversion. The
Corporation shall at all times reserve and keep available out of its authorized
but unissued shares of Common Stock, solely for the purpose of effecting the
conversion of the shares of the Series A Preferred Stock, such number of its
shares of Common Stock that shall from time to time be sufficient to effect the
conversion of all outstanding shares of the Series A Preferred Stock; and if at
any time the number of authorized but unissued shares of Common Stock not
otherwise reserved for issuance shall not be sufficient to effect the conversion
of all then outstanding shares of the Series A Preferred Stock, the Corporation
will take such corporate action that may, in the opinion of its counsel, be
necessary to increase its authorized but unissued shares of Common Stock to such
number of shares as shall be sufficient for such purposes, including without
limitation, engaging in best efforts to obtain the requisite shareholder
approval of any necessary amendment to its Certificate of Incorporation.

                  12. Notices. Any notice required by the provisions hereof to
be given to the holders of shares of Series A Preferred Stock shall be deemed
given on the date of service if served personally on the party to whom notice is
to be given, or on the date of transmittal of services by facsimile transmission
to the party to whom notice is to be given, and addressed to each holder of
record at his address appearing on the books of the Corporation.

                                        9
<PAGE>

                  13. Voting Rights. Subject to Section 14 below, holders of
Series A Preferred Stock shall not be entitled to vote, including with respect
to the election of directors of the Corporation.

                  14. Protective Provisions. Subject to the rights of any series
of preferred stock that may from time to time come into existence, so long as
any shares of Series A Preferred Stock are outstanding, the Corporation shall
not without first obtaining the approval (by vote or written consent, as
provided by law) of the holders of at least a majority of the then-outstanding
shares of Series A Preferred Stock, voting separately as a series:

                  (a) amend its Certificate of Incorporation so as to affect
         adversely the shares of Series A Preferred Stock or any holder thereof
         (including by creating any additional classes or series of Senior
         Stock); or

                  (b) change the rights of the holders of the Series A Preferred
         Stock in any other respect.

                  15. Status of Converted Stock. In the event any shares of
Series A Preferred Stock shall be converted pursuant to Section 4 or exchanged
pursuant to Section 5 hereof, the shares so converted or exchanged shall be
canceled and shall not be reissuable by the Corporation."

                                       10
<PAGE>

                  IN WITNESS WHEREOF, said Generex Biotechnology Corporation has
caused this Certificate of Designations to be signed by Anna E. Gluskin, its
President and Rose C. Perri, its Secretary this 16th day of January, 2001.

                                               GENEREX BIOTECHNOLOGY
                                               CORPORATION

                                               By: /s/ Anna E. Gluskin
                                                   ----------------------------
                                                   Name:  Anna E. Gluskin
                                                   Title: President

                                               By: /s/ Rose C. Perri
                                                   ----------------------------
                                                   Name:  Rose C. Perri
                                                   Title: Secretary

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