Document:

EX-10.4

EXHIBIT 10.4

THIS WARRANT AND THE RIGHTS AND PRIVILEGES GRANTED HEREBY SHALL NOT BE TRANSFERRED OR ASSIGNED.
UPON ANY ATTEMPT TO TRANSFER THIS WARRANT OR ANY RIGHT OR PRIVILEGE GRANTED HEREBY, THIS WARRANT
AND SAID RIGHTS AND PRIVILEGES SHALL IMMEDIATELY BECOME NULL AND VOID.

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933. SUCH
SECURITIES AND ANY SECURITIES OR SHARES ISSUED HEREUNDER MAY NOT BE SOLD OR TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER SAID ACT. COPIES OF THE AGREEMENT
COVERING THE PURCHASE OF THESE SECURITIES AND RESTRICTING THEIR TRANSFER OR SALE MAY BE OBTAINED AT
NO COST BY WRITTEN REQUEST MADE BY THE HOLDER OF RECORD HEREOF TO THE SECRETARY OF THE COMPANY AT
ITS PRINCIPAL EXECUTIVE OFFICES.

No. 0003 Date: August 16, 2005

WARRANT TO PURCHASE COMMON STOCK

OF

VIASPACE INC.

This certifies that, for value received, SYNTHETIC/A/ (AMERICA) LTD. or its registered assigns
(“Holder”) is entitled, subject to the terms and conditions set forth below, to purchase from
VIASPACE INC., a Nevada corporation (the “Company”), in whole or in part, Two Hundred and Fifty
Thousand (250,000) fully paid and nonassessable shares (the “Warrant Shares”) of Common Stock, par
value $0.001 per share, of the Company (the “Common Stock”). The number, character and Exercise
Price of such Warrant Shares are subject to adjustment as provided below and all references to
“Warrant Shares” and “Exercise Price” herein shall be deemed to include any such adjustment or
series of adjustments. The term “Warrant” as used herein shall mean this Warrant, and any warrants
delivered in substitution or exchange therefor as provided herein.

This Warrant is issued pursuant to that certain Consulting, Confidentiality and Proprietary
Rights Agreement, dated as of August 16, 2005 (the “Consulting Agreement”), between the Company and
the initial holder of this Warrant. The holder of this Warrant is subject to certain restrictions,
and entitled to certain rights, as set forth in the Consulting Agreement. The Consulting Agreement
is incorporated herein by reference as though fully set forth herein.

1. Shares Subject to Warrant. Subject to the terms and conditions set forth herein
this Warrant shall be exercisable, in whole or in part, at the election of the Holder of this
Warrant, to purchase Two Hundred and Fifty Thousand (250,000) fully paid and nonassessable shares
of Common Stock.

2.

1

Piggyback Registration Rights.

(a) Right to Piggyback . Whenever the Company proposes to register any of its
securities under the Securities Act (other than on a registration on Form S-4 or any successor form
or a registration of non-convertible debt securities) on a registration form which may be used for
the registration of any Warrant Shares (a “Piggyback Registration”), the Company shall use
reasonable commercial efforts to give prompt written notice to Holder of its intention to effect
such a registration and will include in such registration all Warrant Shares (in accordance with
the priorities set forth in Sections 2(b) and 2(c) below) with respect to which the Company has
received written requests for inclusion within fifteen (15) days after the delivery of the
Company’s notice.

(b) Priority on Primary Registrations. If a Piggyback Registration is an underwritten
primary registration on behalf of the Company and the managing underwriters advise the Company in
writing that in their opinion the number of securities requested to be included in such
registration exceeds the number which can reasonably be sold in such offering, the Company shall
use reasonable commercial efforts to include in such registration first, the securities that the
Company proposes to sell; second, the securities that any holder of registration rights issued
prior to the Effective Date proposes to sell; third, the securities that any shareholder of Company
held prior to the Effective Date proposes to sell; and fourth, the Warrant Shares requested to be
included in such registration.

(c) Priority on Secondary Registrations. If a Piggyback Registration is an
underwritten secondary registration on behalf of holders of the Company’s securities other than a
demand registration and the managing underwriters advise the Company in writing that in their
opinion the number of securities requested to be included in such registration exceeds the number
which can reasonably be sold in such offering, the Company shall use reasonable commercial efforts
to include in such registration first, the securities that any holder of registration rights issued
prior to the Effective Date proposes to sell; second, the securities that any shareholder of
Company held prior to the Effective Date proposes to sell; and third, the Warrant Shares requested
to be included therein by the Holder.

(d) Other Registrations. If the Company has previously filed a registration statement
with respect to Warrant Shares pursuant to this Section 2, and if such previous registration has
not been withdrawn or abandoned, the Company shall use reasonable commercial efforts to not file or
cause to be effected any other registration of any of its equity securities or securities
convertible or exchangeable into or exercisable for its equity securities under the Securities Act
(except on Form S-4 or any successor form), whether on its own behalf or at the request of any
holder or holders of such securities, until a period of at least 90 days has elapsed from the
effective date of such previous registration.

(e) Selection of Underwriters. In connection with any Piggyback Registration in which
Holder has elected to include Warrant Shares, the Company shall have the right to select the
managing underwriters to administer any offering of the Company’s securities in which the Company
participates.

3. Exercise Price. The exercise price under this Warrant (the “Exercise Price”) shall
be $4.00 per share.

4. Term of Warrant. Subject to the terms and conditions set forth herein, this
Warrant shall be exercisable for, in part or in whole, during the term (the “Exercise Period”)
ending at 5:00 p.m., Pacific standard time, on the earliest of the following: (a) the date of
termination of the Consulting Agreement by the Company based on a failure of Holder to materially
perform or comply with the Consulting Agreement or any material provision thereto; (b) the closing
of a merger or consolidation of the Company pursuant to which the stockholders of the Company hold
less than 50% of the voting securities of the surviving or acquiring entity, or a sale of all or
substantially all of the assets of the Company or any successor corporation; (c) August 16, 2007,
provided that the Company Common Stock has not become publicly traded on the Nasdaq on or
prior to such time; or (d) August 16, 2009. The Warrant shall be void and have no effect after the
termination of the Exercise Period.

5. Exercise of Warrant.

(a) Cash Exercise. This Warrant may be exercised by the Holder during the Exercise
Period by (i) the surrender of this Warrant to the Company, with the Notice of Exercise annexed
hereto duly completed and executed on behalf of the Holder, at the office of the Company (or such
other office or agency of the Company as it may designate by notice in writing to the Holder at the
address of the Holder appearing on the books of the Company) and (ii) the delivery of payment to
the Company, for the account of the Company, by cash, wire transfer of immediately available funds
to a bank account specified by the Company, certified or bank cashier’s check, cancellation of
indebtedness, or by any combination of the foregoing, of the Exercise Price for the number of
Warrant Shares specified in the Notice of Exercise in lawful money of the United States of America.
The Company agrees that such Warrant Shares shall be deemed to be issued to the Holder as the
record holder of such Warrant Shares as of the close of business on the date on which this Warrant
shall have been surrendered and payment made for the Warrant Shares as aforesaid. A stock
certificate or certificates for the Warrant Shares specified in the Exercise Form shall be
delivered to the Holder as promptly as practicable thereafter. If this Warrant shall have been
exercised only in part, the Company shall, at the time of delivery of the stock certificate or
certificates, deliver to the Holder a new Warrant evidencing the rights to purchase the remaining
Warrant Shares, which new Warrant shall in all other respects be identical with this Warrant. No
adjustments shall be made on Warrant Shares issuable on the exercise of this Warrant for any
dividends or distributions paid or payable to holders of record of Common Stock prior to the date
as of which the Holder shall be deemed to be the record holder of such Warrant Shares.

(b) Net Issue Exercise. In lieu of exercising this Warrant pursuant to Section
5(a), this Warrant may be exercised by the Holder by the surrender of this Warrant to the
Company, with a duly executed Notice of Exercise marked to reflect “Net Issue Exercise” and
specifying the number of shares of Common Stock to be purchased, during normal business hours on
any Business Day (as defined below) during the Exercise Period. The Company agrees that such
shares of Common Stock shall be deemed to be issued to the Holder as the record holder of such
shares of Common Stock as of the close of business on the date on which this Warrant shall have
been surrendered as aforesaid. Upon such exercise, the Holder shall be entitled to receive shares
equal to the value of this Warrant (or the portion thereof being canceled) by surrender of this
Warrant to the Company together with notice of such election in which event the Company shall issue
to Holder a number of shares of Common Stock computed as of the date of surrender of this Warrant
to the Company using the following formula:

X = Y (A-B)

A

	 	 	 	Where X = the number of shares of Common Stock to be issued to Holder under this
Section 5(b);

	 	 	 	Y = the number of shares of Common Stock otherwise purchasable
under this Warrant (as adjusted to the date of such calculation);

	 	 	 	A = the fair market value of one share of the Common Stock at the
date of such calculation;

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

(c) Fair Market Value. For purposes of the above calculation, fair market value of
one share of Common Stock shall be determined by the Company’s Board of Directors in good faith;
provided, however, that where there exists a public market for the Company’s Common Stock
at the time of such exercise, the fair market value per share of Common Stock shall be the average
of the closing bid and asked prices of the Common Stock quoted in the Over-The-Counter Market
Summary or the last reported sale price of the Common Stock or the closing price quoted on the
Nasdaq National Market or any exchange on which the Common Stock is listed, whichever is
applicable, as published in the Western Edition of The Wall Street Journal for the five (5) trading
days prior to the date of determination of fair market value. Notwithstanding the foregoing, in
the event the Warrant is exercised in connection with the Company’s initial public offering of
Common Stock, the fair market value per share of Common Stock shall be the per share offering price
to the public of the Company’s initial public offering.

(d) This Warrant shall be deemed to have been exercised immediately prior to the close of
business on the date of its surrender for exercise as provided above, and the person entitled to
receive the shares of Common Stock issuable upon such exercise shall be treated for all purposes as
the holder of record of such shares as of the close of business on such date. As promptly as
practicable on or after such date, the Company at its expense shall issue and deliver to the person
or persons entitled to receive the same a certificate or certificates for the number of shares
issuable upon such exercise. In the event that this Warrant is exercised in part, the Company at
its expense will execute and deliver a new Warrant of like tenor exercisable for the number of
shares for which this Warrant may then be exercised.

6. No Fractional Shares or Scrip. No fractional shares or scrip representing
fractional shares shall be issued upon the exercise of this Warrant. In lieu of any fractional
share to which the Holder would otherwise be entitled, the Company shall make a cash payment equal
to the Exercise Price multiplied by such fraction.

7. Replacement of Warrant. On receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of loss,
theft or destruction, on delivery of an indemnity agreement reasonably satisfactory in form and
substance to the Company or, in the case of mutilation, on surrender and cancellation of this
Warrant, the Company at its expense shall execute and deliver, in lieu of this Warrant, a new
warrant of like tenor and amount.

8. Rights of Stockholders. Subject to Sections 11 and 13 of this
Warrant, the Holder shall not be entitled to vote or receive dividends or be deemed the holder of
Common Stock for any purpose, and nothing contained herein shall be construed to confer upon the
Holder, as such, any of the rights of a stockholder of the Company or any right to vote for the
election of directors or upon any matter submitted to stockholders at any meeting thereof, or to
give or withhold consent to any corporate action (whether upon any recapitalization, issuance of
stock, reclassification of stock, change of par value, or change of stock to no par value,
consolidation, merger, conveyance or otherwise) or to receive notice of meetings, or to receive
dividends or subscription rights or otherwise until the Warrant shall have been exercised as
provided herein.

9. Non-Transferability and Non-Negotiability of Warrant. This Warrant and the rights and
privileges granted hereby shall not be transferred or assigned except to any of Maurizio Vecchione,
Barry Hall and Bruce Goldstein and their respective affiliates. Upon any attempt to transfer this
Warrant or any right or privilege granted hereby, this Warrant and said rights and privileges shall
immediately become null and void.

10. Compliance with Securities Laws.

(i) The Holder of this Warrant, by acceptance hereof, acknowledges that the Holder is an
“accredited investor” as that term is defined in Rule 501(a) of Regulation D promulgated under the
Securities Act of 1933, as amended, and this Warrant and the Warrant Shares to be issued upon
exercise hereof are being acquired solely for the Holder’s own account and not as a nominee for any
other party, and for investment, and that the Holder will not offer, sell or otherwise dispose of
this Warrant or any Warrant Shares to be issued upon exercise hereof except under circumstances
that will not result in a violation of the Securities Act or any applicable state securities laws.
Upon exercise of this Warrant, the Holder shall, if requested by the Company, confirm in writing,
in a form satisfactory to the Company, that the Warrant Shares so purchased are being acquired
solely for the Holder’s own account and not as a nominee for any other party, for investment, and
not with a view toward distribution or resale.

(ii) This Warrant shall be stamped or imprinted with a legend in substantially the following
form:

THIS WARRANT AND THE RIGHTS AND PRIVILEGES GRANTED HEREBY SHALL NOT BE TRANSFERRED
OR ASSIGNED. UPON ANY ATTEMPT TO TRANSFER THIS WARRANT OR ANY RIGHT OR PRIVILEGE
GRANTED HEREBY, THIS WARRANT AND SAID RIGHTS AND PRIVILEGES SHALL IMMEDIATELY BECOME
NULL AND VOID.

(iii) This Warrant and all Warrant Shares issued upon exercise hereof shall be stamped or
imprinted with a legend in substantially the following form (in addition to any legend required by
state securities laws):

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933. SUCH SECURITIES AND ANY SECURITIES OR SHARES ISSUED HEREUNDER MAY NOT BE
SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM
UNDER SAID ACT. COPIES OF THE AGREEMENT COVERING THE PURCHASE OF THESE SECURITIES
AND RESTRICTING THEIR TRANSFER OR SALE MAY BE OBTAINED AT NO COST BY WRITTEN REQUEST
MADE BY THE HOLDER OF RECORD HEREOF TO THE SECRETARY OF THE COMPANY AT ITS PRINCIPAL
EXECUTIVE OFFICES.

(iv) The Company agrees to remove promptly, upon the request of the holder of the Warrant
Shares issuable upon exercise of the Warrant, the legend set forth in Section 10(b)(iii)
above from the documents/certificates for such securities upon full compliance with this Warrant
and Rule 144.

11. Reservation of Stock. The Company covenants that during the term this Warrant is
exercisable, the Company will reserve from its authorized and unissued Common Stock a sufficient
number of shares to provide for the issuance of Common Stock upon the exercise of this Warrant and,
from time to time, will take all steps necessary to amend its Certificate of Incorporation, as
amended from time to time, to provide sufficient reserves of shares of Common Stock issuable upon
exercise of the Warrant. The Company further covenants that all shares that may be issued upon the
exercise of rights represented by this Warrant and payment of the Exercise Price, all as set forth
herein, will be free from all taxes, liens and charges in respect of the issue thereof (other than
taxes in respect of any transfer occurring contemporaneously or otherwise specified herein).

12. Notices.

(a) Whenever the Exercise Price or number of shares purchasable hereunder shall be adjusted
pursuant to Section 14 hereof, the Company, upon request of Holder, shall issue a
certificate signed by an executive officer setting forth, in reasonable detail, the event requiring
the adjustment, the amount of the adjustment, the method by which such adjustment was calculated,
and the Exercise Price and number of shares purchasable hereunder after giving effect to such
adjustment, and shall cause a copy of such certificate to be mailed (by first-class mail, postage
prepaid) to the Holder of this Warrant.

(b) In case:

(i) the Company shall take a record of the holders of its Common Stock (or other stock or
securities at the time receivable upon the exercise of this Warrant) for the purpose of entitling
them to receive any dividend or other distribution, or any right to subscribe for or purchase any
shares of stock of any class or any other securities, or to receive any other right;

(ii) of any capital reorganization of the Company, any reclassification of the capital stock
of the Company, any consolidation or merger of the Company with or into another corporation, or any
conveyance of all or substantially all of the assets of the Company to another corporation;

(iii) of any voluntary dissolution, liquidation or winding-up of the Company; or

(iv) of any redemption or conversion of all outstanding Common Stock.

then, and in each such case, the Company will mail or cause to be mailed to the Holder or Holders a
notice specifying, as the case may be, (A) the date on which a record is to be taken for the
purpose of such dividend, distribution or right, and stating the amount and character of such
dividend, distribution or right, or (B) the date on which such reorganization, reclassification,
consolidation, merger, conveyance, dissolution, liquidation, winding-up, redemption or conversion
is to take place, and the time, if any is to be fixed, as of which the holders of record of Common
Stock shall be entitled to exchange their shares of Common Stock for securities or other property
deliverable upon such reorganization, reclassification, consolidation, merger, conveyance,
dissolution, liquidation or winding-up. Such notice shall be mailed at least ten (10) days prior
to the date therein specified.

(c) All such notices, advices and communications shall be delivered to the address of the
Holder on record with the Company and shall be deemed to have been received (i) in the case of
personal delivery, on the date of such delivery and (ii) in the case of mailing, on the third (3rd)
business day following the date of such mailing.

13. Amendments. Subject to Section 14(d) below, this Warrant and any term
hereof may be changed, waived, discharged or terminated only by an instrument in writing signed by
the party against which enforcement of such change, waiver, discharge or termination is sought.

14. Adjustments. The Exercise Price and the number of shares purchasable hereunder
are subject to adjustment from time to time as follows:

(a) Reclassification, etc. If the Company, at any time while this Warrant or any
portion thereof remains outstanding and unexpired, by reclassification of securities or otherwise,
shall change any of the securities as to which purchase rights under this Warrant exist into the
same or a different number of securities of any other class or classes, this Warrant shall
thereafter represent the right to acquire such number and kind of securities as would have been
issuable as the result of such change with respect to the securities that were subject to the
purchase rights under this Warrant immediately prior to such reclassification or other change and
the Exercise Price therefor shall be appropriately adjusted, all subject to further adjustment as
provided in this Section 14.

(b) Split, Subdivision or Combination of Shares. If the Company, at any time while
this Warrant or any portion thereof remains outstanding and unexpired, shall split, subdivide or
combine the outstanding shares of Common Stock into a different number of shares of Common Stock
then (i) in the case of a split or subdivision, the Exercise Price for such securities shall be
proportionately decreased and the Warrant Shares issuable upon exercise of this Warrant shall be
proportionately increased, and (ii) in the case of a combination, the Exercise Price for such
Warrant Shares shall be proportionately increased and the securities issuable upon exercise of this
Warrant shall be proportionately decreased.

(c) Adjustments for Dividends in Stock or Other Securities or Property. If, while
this Warrant or any portion hereof remains outstanding and unexpired, the holders of Common Stock
shall have received, or, on or after the record date fixed for the determination of eligible
stockholders, shall have become entitled to receive, without payment therefor, additional shares of
Common Stock by way of dividend, then and in each case, this Warrant shall represent the right to
acquire, in addition to the number of shares of the security receivable upon exercise of this
Warrant, and without payment of any additional consideration therefor, the amount of such
additional shares of Common Stock that such holder would hold on the date of such exercise had it
been the holder of record of that number of shares of Common Stock receivable upon exercise of this
Warrant on the date hereof and had thereafter, during the period from the date hereof to and
including the date of such exercise, retained such shares and/or all other additional stock
available by it as aforesaid during such period, giving effect to all adjustments called for during
such period by the provisions of this Section 14.

(d) No Impairment. The Company will not, by any 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 14 and in the taking of all such action as may be necessary or appropriate
in order to protect the rights of the Holder of this Warrant against impairment.

15. Miscellaneous.

(a) This Warrant shall be governed by the laws of the State of California as applied to
agreements entered into in the State of California by and among residents of the State of
California.

(b) In the event of a dispute with regard to the interpretation of this Warrant, the
prevailing party shall be entitled to collect the cost of attorneys’ fees, litigation expenses or
such other expenses as may be incurred in the enforcement of the prevailing party’s rights
hereunder.

(c) This Warrant shall be exercisable as provided for herein, except that if the expiration
date of this Warrant shall fall on a day other than a Business Day, the expiration date for this
Warrant shall be extended to 5:00 p.m. Pacific standard time on the next following Business Day.
For purposes of this Warrant, “Business Day” shall mean any day other than a Saturday, Sunday or
United States federally recognized holiday.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

2

IN WITNESS WHEREOF, VIASPACE INC. has caused this Warrant to be executed by its officer
thereunto duly authorized.

	 	 	 
	COMPANY:

	 	

	VIASPACE INC.

By:

	 	

/s/ CARL KUKKONEN
	
 
	 	 

Name: Carl Kukkonen

Title: CEO

3

NOTICE OF EXERCISE

To: VIASPACE INC.

(1) The undersigned hereby:

elects to purchase      shares of Common Stock of VIASPACE INC.
pursuant to Section 1 and the other applicable terms of the attached
Warrant.

	 	(2)	 	The undersigned hereby:

elects to purchase such securities by tender herewith of payment of the
purchase for such shares in full; or

elects to exercise the Net Issue Exercise features of the attached Warrant
with respect to such securities pursuant to the terms of such Warrant.

(3) In exercising this Warrant, the undersigned hereby confirms and acknowledges that the
undersigned is an “accredited investor” as that term is defined in Rule 501(a) of Regulation D
promulgated under the Securities Act of 1933, as amended, and the shares of Common Stock to be
issued upon exercise of this Warrant are being acquired solely for the undersigned’s own account
and not as a nominee for any other party, and for investment, and that the undersigned will not
offer, sell or otherwise dispose of the shares of Common Stock to be issued upon exercise of this
Warrant except under circumstances that will not result in a violation of the Securities Act of
1933, as amended, or any applicable state securities laws.

(4) Please issue a certificate or certificates representing said securities in the name of the
undersigned:

(Name)

(5) Please issue a new Warrant for the unexercised portion of the attached Warrant in the name of
the undersigned:

(Name)

 

	 	 	 	 	 
	(Date)	 	(Signature of Registered Holder)
	 	 	 	 	(Name of Registered Holder)

4Form of Stock Purchase Warrant of FermaVir Pharmaceuticals, Inc.

 

 

Exhibit 4.1

 

 

NEITHER
THIS WARRANT NOR THE SHARES ISSUABLE UPON EXERCISE HEREOF HAVE BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR ANY OTHER
APPLICABLE SECURITIES LAWS IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND SUCH OTHER SECURITIES LAWS. NEITHER THIS
WARRANT NOR THE SHARES ISSUABLE UPON EXERCISE HEREOF MAY BE SOLD, PLEDGED,
TRANSFERRED, ENCUMBERED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR IN A TRANSACTION THAT IS
EXEMPT FROM REGISTRATION UNDER THE PROVISIONS OF THE SECURITIES ACT.

STOCK
PURCHASE WARRANT

No. WA -
___

To
Purchase ____________
Shares of
Common Stock of

FERMAVIR
PHARMACEUTICALS, INC.

THIS
CERTIFIES that, for value received, __________________
(the
“Holder”) is entitled, upon the terms and subject to the conditions hereinafter
set forth, at any time prior to the close of business on August 16, 2010 (the
“Termination Date”), but not thereafter, to subscribe for and purchase from
Fermavir Pharmaceuticals, Inc. (formerly Venus Beauty Supply, Inc.), a
corporation incorporated in Florida (the “Company”), up to _____________________________
(_________) shares
(the “Warrant Shares”) of the common stock, $.0001 par value, of the Company
(the “Common Stock”). The purchase price of one share of Common Stock (the
“Exercise Price”) under this Warrant shall be $1.50. The Exercise Price and the
number of shares for which the Warrant is exercisable shall be subject to
adjustment as provided herein. Capitalized terms used and not otherwise defined
herein shall have the meanings set forth for such terms in the Securities
Purchase Agreement. This Warrant is part of an authorized class of up to 900,000
Warrants of like tenor authorized by the Company pursuant to several Securities
Purchase Agreements variously dated between the Company and the persons
identified therein relating to the purchase and sale of Units, consisting of
shares of Common Stock and Warrants (the “Purchase Agreement”). Capitalized
terms used without being identified herein shall have the meaning ascribed to
such terms by the Purchase Agreement between the Company and the initial
Holder.

1.       
Title
to Warrant. Prior
to and subject to compliance with applicable laws, this Warrant and all rights
hereunder are transferable, in whole or in part, at the office or agency of the
Company by the Holder hereof in person or by duly authorized attorney, upon
surrender of this Warrant together with the Assignment Form annexed hereto
properly endorsed.

2.       
Authorization
of Shares. The
Company covenants that all shares of Common Stock that may be issued upon the
exercise of rights represented by this Warrant will, upon exercise of the rights
represented by this Warrant, be duly authorized, validly issued,
fully-

 

 

paid and
nonassessable and free from all taxes, liens and charges in respect of the issue
thereof (other than taxes in respect of any transfer occurring contemporaneously
with such issue).

3.       
Exercise
of Warrant.
 Except as
otherwise expressly provided herein, exercise of the purchase rights represented
by this Warrant may be made at any time or times on or before the close of
business on the Termination Date by the surrender of this Warrant and the Notice
of Exercise form annexed hereto duly executed, at the office of the Company (or
such other office or agency of the Company as it may designate by notice in
writing to the registered Holder hereof at the address of such Holder appearing
on the books of the Company), and upon payment of the Exercise Price of the
Warrant Shares thereby purchased by wire transfer or certified check, cashier’s
check or money order drawn on a United States bank. The Holder of this Warrant
shall be entitled to receive a certificate for the number of shares of Common
Stock so purchased. If a registration statement for the resale of the shares of
Common Stock issuable upon exercise of this Warrant has not been declared
effective by the Securities and Exchange Commission by the first anniversary of
the first closing of the offering contemplated by the Purchase Agreement, this
Warrant may also be exercised in whole or in part by means of a “cashless
exercise” by means of tendering this Warrant to the Company together with a
written demand to receive the number of shares of Common Stock equal in total
Market Value (as hereinafter defined) to the difference between the total Market
Value of the shares of Common Stock issuable upon such exercise of this Warrant
(to the extent exercised) and the total cash Exercise Price of that part of the
Warrant being exercised. “Market Value” for this purpose shall be the price for
the last trade of the Common Stock as reported by Bloomberg L.P. on the close of
business on the last Trading Day (as such term is defined in the Note issued
pursuant to the Purchase Agreement) preceding the tender of the original
documentation for such cashless exercise. Certificates for shares purchased
hereunder shall be delivered to the Holder hereof within seven (7) Trading Days
after the date on which this Warrant shall have been exercised as aforesaid.
This Warrant shall be deemed to have been exercised and such certificate or
certificates shall be deemed to have been issued, and Holder or any other person
so designated to be named therein shall be deemed to have become a holder of
record of such shares for all purposes, as of the date the Warrant has been
exercised by payment to the Company of the Exercise Price (or in the case of a
cashless exercise, the date the original documents for such cashless exercise
have been received by the Company). If this Warrant shall have been exercised in
part, the Company shall, at the time of delivery of the certificate or
certificates representing Warrant Shares, deliver to Holder a new Warrant
evidencing the rights of Holder to purchase the unpurchased shares of Common
Stock called for by this Warrant; which new Warrant shall in all other respects
be identical with this Warrant.

4.       
No
Fractional Shares or Scrip. No
fractional shares or scrip representing fractional shares shall be issued upon
the exercise of this Warrant. As to any fraction of a share that Holder would
otherwise be entitled to purchase upon such exercise, the Company shall cause
the Transfer Agent to issue one whole share of Common Stock in respect of such
fraction of a share of Common Stock.

5.       
Charges,
Taxes and Expenses.
Issuance of certificates for shares of Common Stock upon the exercise of this
Warrant shall be made without charge to the Holder hereof for any issue or
transfer tax or other incidental expense in respect of the issuance of
such

 

2

 

certificate,
all of which taxes and expenses shall be paid by the Company, and such
certificates shall be issued in the name of the Holder of this Warrant or in
such name or names as may be directed by the Holder of this Warrant; provided,
however, that in the event certificates for shares of Common Stock are to be
issued in a name other than the name of the Holder of this Warrant, this Warrant
when surrendered for exercise shall be accompanied by the Assignment Form
attached hereto duly executed by the Holder hereof; and the Company may require,
as a condition thereto, the payment of a sum sufficient to reimburse it for any
transfer tax incidental thereto.

6.       
Closing
of Books. The
Company will not close its shareholder books or records in any manner that
prevents the timely exercise of this Warrant.

7.       
Transfer,
Division and Combination. (a)
Subject to compliance with any applicable securities laws, transfer of this
Warrant and all rights hereunder, in whole or in part, shall be registered on
the books of the Company to be maintained for such purpose, upon surrender of
this Warrant at the principal office of the Company, together with a written
assignment of this Warrant substantially in the form attached hereto duly
executed by Holder or its agent or attorney, and payment of funds sufficient to
pay any transfer taxes payable upon the making of such transfer. Upon such
surrender and, if required, such payment, the Company shall execute and deliver
a new Warrant or Warrants in the name of the assignee or assignees and in the
denomination or denominations specified in such instrument of assignment, and
shall issue to the assignor a new Warrant evidencing the portion of this Warrant
not so assigned, and this Warrant shall promptly be cancelled. A Warrant, if
properly assigned, may be exercised by a new Holder for the purchase of shares
of Common Stock without having a new Warrant issued.

(b)       
This
Warrant may be divided or combined with other Warrants upon presentation hereof
at the aforesaid office of the Company, together with a written notice
specifying the names and denominations in which new Warrants are to be issued,
signed by Holder or its agent or attorney. Subject to compliance with Section
7(a), as to any transfer that may be involved in such division or combination,
the Company shall execute and deliver a new Warrant or Warrants in exchange for
the Warrant or Warrants to be divided or combined in accordance with such
notice.

(c)       
The
Company shall prepare, issue and deliver at its own expense (other than transfer
taxes) the new Warrant or Warrants under this Section 7.

(d)       
The
Company agrees to maintain, at its aforesaid office, books for the registration
and the registration of transfer of the Warrants.

8.       
No
Rights as Shareholder until Exercise. This
Warrant does not entitle the Holder hereof to any voting rights or other rights
as a shareholder of the Company prior to the exercise hereof. Upon the surrender
of this Warrant and the payment of the aggregate Exercise Price as contemplated
by Section 3, the Warrant Shares so purchased shall be and be deemed to be
issued to such Holder as the record owner of such shares as of the close of
business on the later of the date of such surrender or payment. 

3

 

9.       
Loss,
Theft, Destruction or Mutilation of Warrant. The
Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant
certificate or any stock certificate relating to the Warrant Shares, and in case
of loss, theft or destruction, of indemnity or security reasonably satisfactory
to it (which shall not include the posting of any bond), and upon surrender and
cancellation of such Warrant or stock certificate, if mutilated, the Company
will make and deliver a new Warrant or stock certificate of like tenor and dated
as of such cancellation, in lieu of such Warrant or stock
certificate.

10.      
Saturdays,
Sundays, Holidays, etc. If the
last or appointed day for the taking of any action or the expiration of any
right required or granted herein shall be a Saturday, Sunday or a legal holiday,
then such action may be taken or such right may be exercised on the next
succeeding day not a Saturday, Sunday or legal holiday.

11.      
Adjustments
of Exercise Price and Number of Warrant Shares.

The
number and kind of securities purchasable upon the exercise of this Warrant and
the Exercise Price shall be subject to adjustment from time to time upon the
happening of any of the following. 

(a)       
Reorganization,
Reclassification, Merger, Consolidation or Disposition of Assets.
Following a pending 35.28 for 1 forward split which will take effect in August
2005, in case the Company shall reorganize its capital, reclassify its capital
stock, consolidate or merge with or into another corporation (where the Company
is not the surviving corporation or where there is a change in or distribution
with respect to the Common Stock of the Company), or sell, transfer or otherwise
dispose of all or substantially all its property, assets or business to another
corporation and, pursuant to the terms of such reorganization, reclassification,
merger, consolidation or disposition of assets, shares of common stock of the
successor or acquiring corporation, or any cash, shares of stock or other
securities or property of any nature whatsoever (including warrants or other
subscription or purchase rights) in addition to or in lieu of common stock of
the successor or acquiring corporation (“Other Property”), are to be received by
or distributed to the holders of Common Stock of the Company, then Holder shall
have the right thereafter to receive, upon exercise of this Warrant, the number
of shares of common stock of the successor or acquiring corporation or of the
Company, if it is the surviving corporation, and Other Property receivable upon
or as a result of such reorganization, reclassification, merger, consolidation
or disposition of assets by a holder of the number of shares of Common Stock for
which this Warrant is exercisable immediately prior to such event. In case of
any such reorganization, reclassification, merger, consolidation or disposition
of assets, the successor or acquiring corporation (if other than the Company)
shall expressly assume the due and punctual observance and performance of each
and every covenant and condition of this Warrant to be performed and observed by
the Company and all the obligations and liabilities hereunder, subject to such
modifications as may be deemed appropriate (as determined in good faith by
resolution of the Board of Directors of the Company) in order to provide for
adjustments of shares of Common Stock for which this Warrant is exercisable
which shall be as nearly equivalent as practicable to the adjustments provided
for in this Section 11. For purposes of this Section 11, “common stock of the
successor or acquiring corporation” shall include stock of such

 

4

 

corporation
of any class which is not preferred as to dividends or assets over any other
class of stock of such corporation and which is not subject to redemption and
shall also include any evidences of indebtedness, shares of stock or other
securities which are convertible into or exchangeable for any such stock, either
immediately or upon the arrival of a specified date or the happening of a
specified event and any warrants or other rights to subscribe for or purchase
any such stock. The foregoing provisions of this Section 11 shall similarly
apply to successive reorganizations, reclassifications, mergers, consolidations
or disposition of assets.

12.      
Voluntary
Adjustment by the Company. The
Company may at any time during the term of this Warrant, reduce the then current
Exercise Price to any amount and for any period of time deemed appropriate by
the Board of Directors of the Company, except to the extent such action would
delay or impair the Holder’s right to publicly resell the Warrant Shares
pursuant to Rule 144 promulgated under the Securities Act or
otherwise.

13.       Notice
of Adjustment.
Whenever the number of Warrant Shares or number or kind of securities or other
property purchasable upon the exercise of this Warrant or the Exercise Price is
adjusted, as herein provided, the Company shall promptly mail by registered or
certified mail, return receipt requested, to the Holder of this Warrant notice
of such adjustment or adjustments setting forth the number of Warrant Shares
(and other securities or property) purchasable upon the exercise of this Warrant
and the Exercise Price of such Warrant Shares (and other securities or property)
after such adjustment, setting forth a brief statement of the facts requiring
such adjustment and setting forth the computation by which such adjustment was
made. Such notice, in the absence of manifest error, shall be conclusive
evidence of the correctness of such adjustment.

14.       Notice
of Corporate Action. If at
any time following a pending 35.28 for 1 forward split which will take effect in
August 2005:

(i)       
the
Company shall take a record of the holders of its Common Stock for the purpose
of entitling them to receive a dividend or other distribution, or any right to
subscribe for or purchase any evidences of its indebtedness, any shares of stock
of any class or any other securities or property, or to receive any other right,
or

(ii)       
there
shall be any capital reorganization of the Company, any reclassification or
recapitalization of the capital stock of the Company or any consolidation or
merger of the Company with, or any sale, transfer or other disposition of all or
substantially all the property, assets or business of the Company to, another
corporation or,

(iii)       
there
shall be a voluntary or involuntary dissolution, liquidation or winding up of
the Company; then, in
any one or more of such cases, the Company shall give to Holder (i) at least 10
days’ prior written notice of the date on which a record date shall be selected
for such dividend, distribution or right or for determining rights to vote in
respect of any such reorganization, reclassification, merger, consolidation,
sale, transfer, disposition, liquidation or winding up, and (ii) in the case of
any such reorganization, reclassification, merger, consolidation, sale,
transfer, disposition, dissolution, liquidation or winding up, at least 10 days’
prior written notice of the

 

5

 

date when
the same shall take place. Such notice in accordance with the foregoing clause
also shall specify (i) the date on which any such record is to be taken for the
purpose of such dividend, distribution or right, the date on which the holders
of Common Stock shall be entitled to any such dividend, distribution or right,
and the amount and character thereof, and (ii) the date on which any such
reorganization, reclassification, merger, consolidation, sale, transfer,
disposition, dissolution, liquidation or winding up is to take place and the
time, if any such time is to be fixed, as of which the holders of Common Stock
shall be entitled to exchange their shares of Common Stock for securities or
other property deliverable upon such disposition, dissolution, liquidation or
winding up. Each such written notice shall be sufficiently given if addressed to
Holder at the last address of Holder appearing on the books of the Company and
delivered in accordance with Section 16(d).

15.       Authorized
Shares.

(a)       
The
Company covenants that during the period the Warrant is outstanding, it will
reserve from its authorized and unissued Common Stock a sufficient number of
shares to provide for the issuance of the Warrant Shares upon the exercise of
any purchase rights under this Warrant. The Company further covenants that its
issuance of this Warrant shall constitute full authority to its officers who are
charged with the duty of executing stock certificates to execute and issue the
necessary certificates for the Warrant Shares upon the exercise of the purchase
rights under this Warrant. The Company will take all such reasonable action as
may be necessary to assure that such Warrant Shares may be issued as provided
herein without violation of any applicable law or regulation, or of any
requirements of the Principal Market upon which the Common Stock may be listed.

(b)       
The
Company shall not by any action, including, without limitation, amending its
certificate of incorporation or through any reorganization, 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 of this Warrant, but will at all times in good faith assist in the
carrying out of all such terms and in the taking of all such actions as may be
necessary or appropriate to protect the rights of Holder against impairment.
Without limiting the generality of the foregoing, the Company will (i) not
increase the par value of any shares of Common Stock receivable upon the
exercise of this Warrant above the amount payable therefor upon such exercise
immediately prior to such increase in par value, (ii) take all such action as
may be necessary or appropriate in order that the Company may validly and
legally issue fully paid and nonassessable shares of Common Stock upon the
exercise of this Warrant, and (iii) use its best efforts to obtain all such
authorizations, exemptions or consents from any public regulatory body having
jurisdiction thereof as may be necessary to enable the Company to perform its
obligations under this Warrant.

(c)       
Upon the
request of Holder, the Company will at any time during the period this Warrant
is outstanding acknowledge in writing, in form reasonably satisfactory to
Holder, the continuing validity of this Warrant and the obligations of the
Company hereunder.

(d)       
Before
taking any action pursuant to Section 11 or 12 that would cause an adjustment
reducing the current Exercise Price below the then par value, if any, of
the

 

6

 

shares of
Common Stock issuable upon exercise of the Warrants, the Company shall take any
corporate action that may be necessary in order that the Company may validly and
legally issue fully- paid and nonassessable shares of such Common Stock at such
adjusted Exercise Price.

(e)       
Before
taking any action that would result in an adjustment in the Exercise Price, the
Company shall obtain all such authorizations or exemptions thereof, or consents
thereto, as may be necessary from any public regulatory body or bodies having
jurisdiction thereof.

16.       Miscellaneous.

(a)       
Jurisdiction. This
Warrant shall be binding upon any successors or assigns of the Company. This
Warrant shall constitute a contract under the laws of the State of Florida
without regard to its conflict of law principles or rules.

(b)       
Restrictions. The
Holder hereof acknowledges that the Warrant Shares acquired upon the exercise of
this Warrant, if not registered or exempt from registration, will have
restrictions upon resale imposed by state and Federal securities
laws.

(c)       
Nonwaiver
and Expenses. No
course of dealing or any delay or failure to exercise any right hereunder on the
part of Holder shall operate as a waiver of such right or otherwise prejudice
Holder’s rights, powers or remedies; notwithstanding which all rights hereunder
terminate on the Termination Date. If the Company fails to comply with any
provision of this Warrant, the Company shall pay to Holder such amounts as shall
be sufficient to cover any costs and expenses including, but not limited to,
reasonable attorneys’ fees, including those of appellate proceedings, incurred
by Holder in collecting any amounts due pursuant hereto or in otherwise
enforcing any of its rights, powers or remedies hereunder. The foregoing shall
not contribute a limitation on the rights of the Holder in the event of the
Company’s breach or default of its obligations hereunder.

(d)       
Notices. Any
notice, request or other document required or permitted to be given or delivered
to the Holder hereof by the Company shall be delivered in accordance with the
notice provisions of the Purchase Agreement.

(e)       
Limitation
of Liability. No
provision hereof, in the absence of affirmative action by Holder to purchase
shares of Common Stock, and no enumeration herein of the rights or privileges of
Holder hereof, shall give rise to any liability of Holder for the purchase price
of any Common Stock or as a stockholder of the Company, whether such liability
is asserted by the Company or by creditors of the Company.

(f)       
Remedies. Holder,
in addition to being entitled to exercise all rights granted by law, including
recovery of damages, will be entitled to specific performance of its rights
under this Warrant. The Company agrees that monetary damages would not be
adequate compensation for any loss incurred by reason of a breach by it of the
provisions of this Warrant and hereby agrees to waive the defense in any action
for specific performance that a remedy at law would be adequate.

 

7

 

(g)       
Successors
and Assigns. Subject
to applicable securities laws, this Warrant and the rights and obligations
evidenced hereby shall inure to the benefit of and be binding upon the
successors of the Company and the successors and permitted assigns of Holder.
The provisions of this Warrant are intended to be for the benefit of all Holders
from time to time of this Warrant and shall be enforceable by any such Holder or
holder of Warrant Shares.

(h)       
Indemnification. The
Company agrees to indemnify and hold harmless Holder from and against any
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
claims, costs, attorneys’ fees, expenses and disbursements of any kind that may
be imposed upon, incurred by or asserted against Holder in any manner relating
to or arising out of any failure by the Company to perform or observe in any
material respect any of its covenants, agreements, undertakings or obligations
set forth in this Warrant; provided,
however, that
the Company will not be liable hereunder to the extent that any liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, claims,
costs, attorneys’ fees, expenses or disbursements are found in a final
non-appealable judgment by a court to have resulted from Holder’s negligence,
bad faith or willful misconduct in its capacity as a stockholder or
warrantholder of the Company.

(i)       
Severability.
Wherever possible, each provision of this Warrant shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Warrant shall be prohibited by or invalid under applicable law, such
provision shall be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provisions or the remaining
provisions of this Warrant.

(j)       
Headings. The
headings used in this Warrant are for the convenience of reference only and
shall not, for any purpose, be deemed a part of this Warrant.

IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed by its
officer thereunto duly authorized.

Dated:
August ___, 2005

 

	 	 	 
	 	FERMAVIR PHARMACEUTICALS,
      INC.
	 
 	 
 	 
 
		By:  	
	 	
      

    
	 	Name: Geoffrey W.
      Henson
      Title:   
      CEO

8

 

NOTICE OF
EXERCISE

To:    
Fermavir
Pharmaceuticals, Inc.

(1)       
The
undersigned hereby elects to purchase ________ shares of Common Stock (the
“Common Stock”) of Fermavir Pharmaceuticals, Inc., pursuant to the terms of the
attached Warrant, and [ ] tenders herewith payment of the exercise price in full
OR [ ] tenders the Warrant for cashless exercise, together with all applicable
transfer taxes, if any.

(2)       
Calculation
of cashless exercise value, if applicable: ____________________________________
_____________________________________________________________________________________________

________________________.

(3)       
Please
issue a certificate or certificates representing said shares of Common Stock in
the name of the undersigned or in such other name as is specified
below:

 

	 		 
	 	
      

    	 
	 	(Name)	 
	 	 	 
	 		 
	 	
      

    	 
	 	(Address)	 
	 	 	 
	 		 
	 	
      

    	 

Dated:

 

 

	 	 		 
	 	 	
      

    	 
	 	 	
      Signature
	 

 

9

 

ASSIGNMENT
FORM

(To
assign the foregoing Warrant, execute

this form
and supply required information. 

Do not
use this form to exercise the Warrant.)

FOR VALUE
RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby
assigned to

 

 

		 whose address
    is	 
	
      

    	 	 
		 
	
      

    	 
		 
	
      

    	 

 

	 	 	 
	
       Dated:  
	______________, _______

 

 

	 	Holder's Signature:		 
	 	 	
      

    	 
	 	 	 	 
	 	Holder's Address:		 
	 	 	
      

    	 
	 	 		 
	 	 		 
	 	 	
      

    	 

 

 

 

	Signature
Guaranteed:		 
	 	
      

    	 

 

NOTE: The
signature to this Assignment Form must correspond with the name as it appears on
the face of the Warrant, without alteration or enlargement or any change
whatsoever, and must be guaranteed by a bank or trust company. Officers of
corporations and those acting in a fiduciary or other representative capacity
should file proper evidence of authority to assign the foregoing
Warrant.

ASSIGNMENT
OF THIS WARRANT AND RELATED RIGHTS MAY ONLY BE MADE IN COMPLIANCE WITH
APPLICABLE LAW AND THE TERMS OF THE SECURITIES PURCHASE AGREEMENT PURSUANT TO
WHICH THIS WARRANT WAS ISSUED. ANY TRANSFER IN VIOLATION THEREOF SHALL BE VOID
NOT BINDING UPON THE COMPANY.

 

 

10

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