THE SECURITIES REPRESENTED BY THIS WARRANT CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. SUCH SECURITIES
MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
EXEMPTION THEREFROM UNDER SAID ACT.
Warrant to Purchase Shares
# ASCENDIANT CLASS - 01 1,000,000
SANGUINE CORPORATION (OTC:BB SGNC)
(Incorporated under the laws of the State of Nevada)
WARRANT CERTIFICATE FOR THE PURCHASE OF SHARES OF
THE $.001 PAR VALUE COMMON STOCK OF SANGUINE CORPORATION (OTC:BB SGNC)
EXERCISABLE ONLY AFTER February 20, 2002, AND VOID AFTER February 21,
2005.
Warrant Price: $.15 (Fifteen Cents) per share.
THIS IS TO CERTIFY that, for value received, Richard H. Walker or his
registered assigns (either or both of whom are referred to herein as the
"Holder"), is entitled to purchase, subject to the terms and conditions
hereinafter set forth, at anytime from and after February 20, 2002 and
on or before February 21, 2005 (the "Warrant Period"), up to 1,000,000
shares of the $.001 par value common stock ("Common Stock") of Sanguine
Corporation (the "Company"), and to receive certificate(s) for the
Common Stock so purchased. This warrant may be exercised in whole or in
part. Such exercise shall be accomplished by tender to the Company of
the purchase price set forth above as the warrant price (the "Warrant
Price"), either in cash or by certified check or bank cashier's check,
payable to the order of the Company, together with presentation and
surrender to the Company of this Warrant with an executed subscription
in substantially the form attached hereto as Exhibit A. Fractional
shares of the Company's Common Stock will not be issued upon the
exercise of this Warrant.
2. The Company agrees at all times to reserve and hold avail-
able out of the aggregate of its authorized but unissued Common Stock
the number of shares of its Common Stock issuable upon the exercise of
this and all other Warrants of like tenor then outstanding. The Company
further covenants and agrees that all shares of Common Stock that may be
delivered upon the exercise of this Warrant will, upon delivery, be
fully paid and nonassessable and free from all taxes, liens and charges
with respect to the purchase thereof hereunder.
This Warrant and the Common Stock issuable upon the exercise
hereof may not be sold, transferred, pledged or hypothecated unless the
Company shall have been supplied with evidence reasonably satisfactory
to it that such transfer is not in violation of the Securities Act of
1933, as amended (the "Act") and any applicable state laws.
If this Warrant is transferred, in whole or in part, upon
surrender of this Warrant to the Company, the Company shall deliver to
each transferee a Warrant evidencing the rights of such transferee to
purchase the number of shares of Common Stock that such transferee is
entitled to purchase pursuant to such transfer.
The Company may place a legend on this Warrant or any replacement
Warrant and on each certificate representing shares issuable upon
exercise of this Warrant as to which the Company has not been supplied
evidence that the transfer of such security would not be in violation of
the Act and any applicable state laws.
Only the registered Holder may enforce the provisions of this
Warrant against the Company. A transferee of the original registered
Holder becomes a registered Holder only upon notice to the Company
substantially in the form set forth in Exhibit B hereto.
3. This Warrant does not entitle the Holder to any voting
rights or other rights as a stockholder of the Company, nor to any other
rights whatsoever except the rights herein set forth, and no dividend
shall be payable or accrue by reason of this Warrant or the interest
represented hereby, or the shares purchasable hereunder, until or
unless, and except to the extent that, this Warrant is exercised.
This Warrant is exchangeable upon its surrender by the Holder to
the Company for new Warrants of like tenor and date representing in the
aggregate the right to purchase the number of shares purchasable
hereunder, each of such new Warrants to represent the right to purchase
such number of shares as may be designated by the Holder at the time of
such surrender.
4. The Warrant Price and the number of shares purchasable upon
the exercise of this Warrant are subject to adjustment from time to time
upon the occurrence of any of the events specified in this Section 4.
(a) In case the Company shall (i) pay a dividend in shares
of Common Stock or make a distribution in shares of Common Stock, (ii)
subdivide its outstanding shares of Common Stock, (iii) combine its
outstanding shares of Common Stock into smaller number of shares of
Common Stock, or (iv) issue by reclassification of its shares of Common
Stock other securities of the Company, the number of shares of Common
Stock purchasable upon exercise of this Warrant immediately prior
thereto shall be adjusted so that the Holder of this Warrant shall be
entitled to receive the kind and number of shares of Common Stock or
other securities of the Company that he would have owned or have been
entitled to receive after the happening of any of the events described
above, had such Warrant been exercised immediately prior to the
happening of such event or any record date with respect thereto. An
adjustment made pursuant to this paragraph (a) shall become effective
immediately after the effective date of such event retroactive to the
record date, if any, for such event.
(b) Whenever the number of shares of Common Stock pur-
chasable upon the exercise of this Warrant is adjusted, as herein
provided, the Warrant Price shall be adjusted by multiplying such
Warrant Price immediately prior to such adjustment by a fraction, of
which the numerator shall be the number of shares of Common Stock
purchasable upon the exercise of this Warrant immediately prior to such
adjustment, and of which the denominator shall be the number of shares
of Common Stock so purchasable immediately thereafter.
(c) For the purpose of this Section 4, the term shares of
Common Stock shall mean (i) the class of stock designated as the Common
Stock of the Company at the date of this Warrant, or (ii) any other
class of stock resulting from successive changes or reclassifications of
such shares consisting solely of change in par value, or from par value
to no par value, or from no par value to par value.
(d) If during the Warrant Period the Company consolidates
with or merges into another corporation or transfers all or
substantially all of its assets the Holder shall thereafter be entitled
upon exercise hereof to purchase, with respect to each share of Common
Stock purchasable hereunder immediately prior to the date upon which
such consolidation or merger becomes effective, the securities or
property to which a holder of shares of Common Stock is entitled upon
such consolidation or merger, without any change in, or payment in
addition to the Warrant Price in effect immediately prior to such merger
or consolidation, and the Company shall take such steps in connection
with such consolidation or merger as may be necessary to ensure that all
of the provisions of this Warrant shall thereafter be applicable, as
nearly as reasonably may be, in relation to any securities or property
thereafter deliverable upon the exercise of this Warrant. The Company
shall not effect any such consolidation, merger or asset transfer unless
prior to the consummation thereof the successor corporation (if other
than the Company) resulting therefrom shall assume by written agreement
executed and mailed to the registered Holder at his address shown on the
books and records of the Company, the obligation to deliver to such
Holder any such securities or property as in accordance with the
foregoing provisions such Holder shall be entitled to purchase.
(e) Upon the happening of any event requiring an adjust-
ment of the Warrant Price, the Company shall forthwith give written
notice thereof to the registered Holder of this Warrant, stating the
adjusted Warrant Price and the adjusted number of shares of Common Stock
or other securities or property purchasable upon the exercise hereof
resulting from such event and setting forth in reasonable detail the
method of calculation and the facts upon which such calculation is
based. The Board of Directors of the Company shall determine the
adjusted Warrant Price and the securities or property purchasable upon
exercise. If any voluntary or involuntary dissolution, liquidation, or
winding up of the Company is proposed, the Company shall give at least
20 days prior written notice of such proposal to the registered Holder
hereof stating the date on which such event is to take place and the
date (which shall be at least 20 days after giving of such notice) as of
which the holders of shares of Common Stock of record shall be entitled
to exchange their Common Stock for securities or other property
deliverable upon such dissolution, liquidation or winding up. This
Warrant and all rights hereunder shall terminate as of the date on which
such dissolution, liquidation, or winding up takes place. The notices
pursuant to this paragraph shall be given by first class mail, postage
prepaid, addressed to the registered Holder of this Warrant at his
address appearing in the records of the Company.
(f) Irrespective of any adjustments pursuant to this
Section 4 to the Warrant Price or to the number of shares or other
securities or other property obtainable upon exercise of this Warrant,
this Warrant may continue to state the Warrant Price and the number of
shares obtainable upon exercise, as the same price and number of shares
stated herein.
5. (a) Whether or not this Warrant has yet been exercised in
whole or in part, the Company shall, at its own expense, register and
include all shares of Common Stock issued or issuable upon exercise of
the Warrants in the registration, which is contemplated to be filed by
the Company between February 2002 and April 2002.
(b) Notwithstanding the foregoing, should for any reason
all shares of Common Stock issued or issuable upon the exercise of the
Warrants not be registered pursuant to the provisions of subsection 5(a)
above, then in the event that the Company proposes, at any time
subsequent to February 20, 2002, but prior to February 21, 2005, whether
or not this Warrant has yet been exercised in whole or in part, to file
any other registration statement on a general form of registration under
the Act relating to securities issued or to be issued by it, then it
shall give written notice of such proposal to the record owners of the
Warrants and any shares of Common Stock issued upon the exercise
thereof. If, within 15 days after the giving of such notice, the record
owners of any of the Warrants or shares of Common Stock issued or
issuable upon their exercise shall request in writing that all or any of
the shares of Common Stock issued or issuable upon exercise of the War-
rants be included in such proposed registration, the Company will, at
its own expense (except as set forth below), also register such shares
of Common Stock as shall have been so requested in writing; provided,
however, that
(i) the Company shall not be required to include any
of such shares of Common Stock if, by reason of such inclusion,
the Company shall be required to prepare and file a registration
statement on a form promulgated by the Securities and Exchange
Commission different from that which the Company otherwise would
use;
(ii) Holder shall cooperate with the Company in the
preparation of such registration statement to the extent required
to furnish information concerning such owners therein; and
(iii) if any underwriter or managing agent is pur-
chasing or arranging for the sale of the securities then being
offered by the Company under such registration statement, then
Holder shall agree to have the securities being so registered sold
to or by such underwriter or managing agent on terms substantially
equivalent to the terms upon which the Company is selling the sec-
urities so registered.
(c) In connection with the filing of a registration state-
ment pursuant to subsections 5(a) and 5(b), the Company shall:
(i) notify Holder as to the filing thereof and of
all amendments thereto filed prior to the effective date of said
registration statement;
(ii) notify Holder, promptly after it shall have
received notice thereof, of the time when the registration
statement becomes effective or any supplement to any prospectus
forming a part of the registration statement has been filed;
(iii) prepare and file without expense to Holder any
necessary amendment or supplement to such registration statement
or prospectus as may be necessary to comply with Section 10(a)(3)
of the Act or advisable in connection with the proposed
distribution of the securities by Holder;
(iv) take all reasonable steps to qualify the shares
of Common Stock being so registered for sale under the securities
or blue sky laws in such states, but only in such states, as the
Company would qualify the sales of its securities absent any
registration of the shares of Common Stock issued or issuable
hereunder; and,
(v) notify Holder of any stop order suspending the
effectiveness of the registration statement and use its reasonable
best efforts to remove such stop order.
6. In connection with the obligation of the Company to register
shares of Common Stock pursuant to the provisions of Section 5 hereof,
the Company and each Holder agree as follows:
(a) The Company hereby agrees to indemnify and hold
harmless each Holder and each person who controls each Holder within the
meaning of Section 15 of the Act or Section 20 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), from and against
any and all losses, claims, damages, liabilities or actions to which
each Holder or they or any of them may become subject under the Act, the
Exchange Act or otherwise and to reimburse the persons indemnified above
for any legal or other expenses (including the cost of any investigation
and preparation) reasonably incurred by them in connection with any
litigation or proceeding or threatened litigation or proceeding, whether
or not resulting in any liabilities, but only insofar as such losses,
claims, damages, liabilities or actions arise out of, or are based upon
(i) any untrue statement or alleged untrue statement of a material fact
contained in the registration statement with respect to the shares of
Common Stock (or incorporated therein by reference) or any amendment or
supplement thereto (such registration statement, together with any such
amendments or supplements, is referred to herein as the "Registration
Statement"), or the omission or alleged omission to state in the
Registration Statement a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading, or (ii) the employment of
the Company of any device, scheme or artifice to defraud, or the
engaging by the Company in any act, practice or course of business which
operates or would operate as a fraud or deceit, or any conspiracy with
respect thereto, in which the Company shall participate, in connection
with the sale pursuant to the Registration Statement of any of the
securities registered thereby; provided, however, that the indemnity
agreement contained in this paragraph (a) shall not extend to any
indemnified person in respect of any such losses, claims, damages,
liabilities or actions arising out of, or based upon, any such untrue
statement or alleged untrue statement or any such omission or alleged
omission, if such statement or omission was made in reliance upon
information furnished in writing to the Company by such person specifi-
cally for use in connection with the preparation of the Registration
Statement. The Company agrees to pay any legal and other expenses for
which it is liable under this paragraph (a) from time to time (but not
more frequently than monthly) within 30 days after its receipt of a bill
therefor.
(b) Each Holder agrees to indemnify and hold harmless the
Company, its directors, its officers who shall have signed the
registration statement, each person, if any, who controls the Company
within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act to the same extent as the foregoing indemnity from the
Company to each Holder but in each case to the extent, and only to the
extent, that any statement in or omission from or alleged omission from
the registration statement, any preliminary prospectus, the prospectus
or any amendment or supplement thereto was made in reliance upon
information furnished in writing to the Company by such Holder
specifically for use in connection with the preparation of the
registration statement, any preliminary prospectus or the prospectus or
any such amendment or supplement thereto. Each Holder agrees to pay any
legal and other expenses for which it is liable under this paragraph (b)
within 30 days after its receipt of a bill therefor.
(c) If any action is brought against a person entitled to
indemnification pursuant to the foregoing paragraphs (a) or (b) (an
"Indemnified Party") in respect of which indemnity may be sought against
a person granting indemnification (an "Indemnifying Party") pursuant to
such subsections, such Indemnified Party shall promptly notify such
Indemnifying Party in writing of the commencement thereof; but the
omission so to notify the Indemnifying Party of any such action shall
not release the Indemnifying Party from any liability it may have to
such Indemnified Party otherwise than on account of the indemnity
agreement contained in paragraphs (a) or (b). In case any such action
is brought against an Indemnified Party and it notifies an Indemnifying
Party of the commencement thereof, the Indemnifying Party against which
a claim is to be made will be entitled to participate therein, and, to
the extent that it may wish, to assume the defense thereof, with counsel
reasonably satisfactory to such Indemnified Party, provided, however,
that if the defendants in any such action include both the Indemnified
Party and the Indemnifying Party and the Indemnified Party shall have
reasonably concluded based upon advice of counsel that there may be
legal defenses available to it and/or other Indemnified Parties which
conflict with those available to the Indemnifying Party, the Indemnified
Party shall have the right to select separate counsel to assume such
legal defenses and otherwise to participate in the defense of such
action on behalf of such Indemnified Party or Parties. Upon receipt of
notice from the Indemnifying Party to such Indemnified Party of its
election so to assume the defense of such action and approval by the
Indemnified Party of counsel, the Indemnifying Party will not be liable
to such Indemnified Party under this agreement for any legal or other
expenses subsequently incurred by such Indemnified Party in connection
with the defense thereof unless (i) the Indemnified Party shall have
employed such counsel in connection with the assumption of legal
defenses in accordance with the proviso to the next preceding sentence
(it being understood, however, that the Indemnifying Party shall not be
liable for the expenses of more than one separate counsel), (ii) the
Indemnifying Party shall not have employed counsel reasonably
satisfactory to the Indemnified Party to represent the Indemnified Party
within a reasonable time after notice of commencement of the action or
(iii) the Indemnifying Party has authorized the employment of such
counsel for the Indemnified Party at the expense of the Indemnifying
Party. An Indemnifying Party shall not be liable for any settlement of
any action or proceeding effected without its written consent.
(d) In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided
for in paragraph (a) is unavailable to a Holder in accordance with its
terms, the Company and each Holder shall contribute to the aggregate
losses, claims, damages and liabilities of the nature contemplated by
said indemnity agreement incurred by each Holder based on the relative
fault of the Company on the one hand, and each Holder on the other hand,
in connection with the statements or omissions which resulted in such
losses, claims, damages and liabilities. The relative fault shall be
determined by reference to, among other things, whether in the case of
an untrue statement or alleged untrue statement of a material fact or
the omission or alleged omission to state a material fact, such
statement or omission relates to information supplied by the Company or
such Holder and the party's relative intent, knowledge, access to
information and opportunity to correct or prevent such untrue statement
or omission. The amount paid or payable by the Indemnified Party as a
result of the losses, claims, damages, or liabilities referred to above
in this paragraph shall be deemed to include any legal or other expenses
reasonably incurred by such Indemnified Party in connection with inves-
tigating or defending against or appearing as a third party witness in
any such action or claim. Notwithstanding the provisions of this
paragraph, if a Holder is found to be guilty of fraudulent
misrepresentation within the meaning of Section 11(f) of the Act, it
shall not be entitled to contribution from the Company unless the
Company is also found to be guilty of such fraudulent misrepresentation.
IN WITNESS WHEREOF, the Company has caused this Warrant to be
executed by its duly authorized officer.
DATED: February 18, 2002 SANGUINE CORPORATION (SGNC)
By:/s/Thomas C. Drees
Thomas C. Drees, Ph.D.,
Chairman & CEO
EXHIBIT "A"
SUBSCRIPTION FORM
(To be Executed by the Registered Holder to Exercise the Rights To
Purchase Common Stock Evidenced by the Warrant)
The undersigned hereby irrevocably subscribes for ________ shares
(the "Stock") of the Common Stock of SANGUINE CORPORATION (the
"Company") pursuant to and in accordance with the terms and conditions
of the attached Warrant and hereby makes payment of $___________
therefor, and requests that a certificate for such shares be issued in
the name of the undersigned and be delivered to the undersigned at the
address stated below. If such number of shares is not all of the shares
purchasable pursuant to the attached Warrant, the undersigned requests
that a new Warrant of like tenor for the balance of the remaining shares
purchasable thereunder be delivered to the undersigned at the address
stated below.
In connection with the issuance of the Stock, I hereby represent
to the Company that I am acquiring the Stock for my own account for
investment and not with a view to, or for resale in connection with, a
distribution of the shares within the meaning of the Securities Act of
1933, as amended (the "Act").
I agree that, until such shares have been registered, each share
certificate representing the Common Stock delivered to me shall bear
substantially the following legend:
"The shares represented by this certificate have not been
registered under the Securities Act of 1933, as amended. The
shares may not be sold or transferred in the absence of such
registration or an exemption therefrom under said Act."
I further agree that unless the shares are registered, the Company
may place stop orders on the certificates evidencing the Stock with the
transfer agent, if any, to the same effect as the above legend. The
legend and stop transfer notice referred to above shall be removed only
upon my furnishing to the Company an opinion of counsel (reasonably
satisfactory to the Company) to the effect that such legend may be
removed or if such shares have been registered.
Date:__________________ Signed:____________________________
Address: _____________________
_____________________
_____________________
SIGNATURE(S) MUST BE GUARANTEED BY A MEMBER FIRM OF A REGISTERED
NATIONAL SECURITIES EXCHANGE, OR BY A BANK (OTHER THAN A SAVINGS BANK)
OR TRUST COMPANY, AND THE SIGNATURE TO THIS SUBSCRIPTION FORM MUST
CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THE WARRANT IN
EVERY PARTICULAR, WITHOUT ALTERNATION OR ENLARGEMENT, OR ANY CHANGE
WHATSOEVER.
EXHIBIT "B"
ASSIGNMENT
(To be Executed by the Registered Holder to Effect Transfer of the
Warrant)
For Value Received _______________ hereby sells, assigns and transfers
to ____________________ this Warrant and the rights represented hereby
to purchase Common Stock in accordance with the terms and conditions
hereof, and does hereby irrevocably constitute and appoint
_____________________________________ as attorney to transfer this
warrant on the books of the Company with full power of substitution.
Dated:__________________ Signed:____________________________
Please print or typewrite Please insert Social Security
name and address of or other Tax Identification
assignee: Number of Assignee:
_________________________ ______-________-______________
_________________________
_________________________
_________________________