-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, PX3bpPfuZr5Yc+dn0uuTAix6JdLRUWfbNEo4GKkcEmkoKKOCBPN+/4ayD4fd4nge NcYeopHuO+uI7hDaMEcg4w== 0000897069-03-000304.txt : 20030312 0000897069-03-000304.hdr.sgml : 20030312 20030312154323 ACCESSION NUMBER: 0000897069-03-000304 CONFORMED SUBMISSION TYPE: POS AM PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20030312 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NYMOX PHARMACEUTICAL CORP CENTRAL INDEX KEY: 0001018735 STANDARD INDUSTRIAL CLASSIFICATION: IN VITRO & IN VIVO DIAGNOSTIC SUBSTANCES [2835] IRS NUMBER: 000000000 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: POS AM SEC ACT: 1933 Act SEC FILE NUMBER: 333-31310 FILM NUMBER: 03600914 BUSINESS ADDRESS: STREET 1: 9900 CAVENDISH BLVD., SUITE 306 STREET 2: ST. LAURENT CITY: QUEBEC CANADA STATE: A8 ZIP: H4M 2V2 BUSINESS PHONE: 514-332-32 MAIL ADDRESS: STREET 1: 9900 CAVENDISH BLVD., SUITE 306 STREET 2: ST. LAURENT CITY: QUEBEC CANADA STATE: A8 ZIP: H4M 2V2 POS AM 1 irm208.txt AMENDMENT NO. 6 TO FORM F-1, FILED ON FORM F-3 As filed with the Securities and Exchange Commission on March 12, 2003 Registration No. 333-31310 ================================================================================ SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ____________________ AMENDMENT NO. 6 TO FORM F-1 REGISTRATION STATEMENT FILED ON FORM F-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Nymox Pharmaceutical Corporation (Exact name of registrant as specified in charter) Quebec, Canada 8071 (State or other (Primary Standard Not Applicable jurisdiction of Industrial Classification (I.R.S. Employer incorporation or Code Number) Identification No.) organization) 9900 Cavendish Blvd., Suite 306 St. Laurent, QC, Canada H4M 2V2 (514) 332-3222 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) CT Corporation System 111 Eighth Avenue, 13th Floor New York, New York 10011 (212) 590-9200 (Name, address, including zip code, and telephone number, including area code, of agent for service) ------------------------------------------------------------ Copies to: Thomas E. Hartman Jack Gemmell Foley & Lardner Nymox Pharmaceutical Corporation 3000 K Street, N.W., Suite 500 9900 Cavendish Blvd., Suite 306 Washington, DC, 20007-5101 St.-Laurent, QC, Canada H4M 2V2 (202) 945-6191 (514) 332-3222 Approximate date of commencement of proposed sale to public: From time to time after this registration statement becomes effective. If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. [_] If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. [X] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. [_] CALCULATION OF REGISTRATION FEE All financial information in this prospectus is in United States dollars unless otherwise noted.
=================================== =================== ==================== ====================== ================== Proposed Proposed maximum maximum Amount of Title of each class of Amount to be aggregate price aggregate offering registration Securities to be registered registered (1) per unit (2) price fee - ----------------------------------- ------------------- -------------------- ---------------------- ------------------ Common shares, no par value Up to 200,000 $4.52 $904,000 $238.66(3) - ----------------------------------- ------------------- -------------------- ---------------------- ------------------ (1) Represents shares issuable on the exercise of a stock purchase warrant issued by Nymox to Jaspas Investments Ltd. on November 1, 1999. Under the warrant, Jaspas Investments Ltd. may purchase up to 200,000 shares during the period between November 30, 1999 and November 30, 2004. (2) Estimated solely for the purpose of calculating the amount of the registration fee pursuant to Rule 457 (c) under the Securities Act. (3) This registration fee was previously paid by the Registrant in connection with the initial filing of this Registration Statement.
____________________ The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Securities and Exchange Commission ("Commission"), acting pursuant to Section 8(a) may determine. EXPLANATORY NOTE This post-effective amendment to the Registrant's Form F-1 Registration Statement originally filed on February 29, 2000 (Registration No. 333-31310), is being filed: (i) to withdraw from registration 4,291,691 unissued common shares of the up to 4,800,000 common shares originally registered in connection with the Registrant's Common Stock Purchase Agreement with Jaspas Investments Ltd., which terminated in accordance with its terms in November 2002; and (ii) to convert the Form F-1 Registration Statement to a Form F-3 Registration Statement with respect to the continued registration of up to 200,000 common shares registered in connection with a stock purchase warrant issued to Jaspas Investments Ltd. Preliminary Prospectus dated March 12, 2003 The information contained in this prospectus is not complete and may be changed. The selling shareholder may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to by these securities in any state where the offer or sale is not permitted. [LOGO] PROSPECTUS NYMOX PHARMACEUTICAL CORPORATION 200,000 SHARES OF COMMON STOCK NYMOX PHARMACEUTICAL This prospectus relates to the resale by CORPORATION Jaspas Investments Ltd. of up to 200,000 shares of Nymox common stock that Nymox may issue upon exercise, in whole or in part, of a warrant held by Jaspas Investments Ltd.. 9900 Cavendish Blvd Nymox will not receive any of the Suite 306 proceeds from the sale of the shares by St. Laurent, Quebec, Canada Jaspas Investments Ltd., but will H4M 2V2 receive proceeds upon exercise by Jaspas (800) 936-9669 of the warrant, except to the extent Jaspas effects a cashless exercise of the warrant by surrendering to Nymox a portion of the shares of Nymox common stock otherwise issuable upon exercise of the warrant. Nymox will pay the costs of registering the sale of the shares covered by this prospectus, including legal fees. Nymox's common stock is listed on the Nasdaq SmallCap Market under the symbol "NYMX". Investing in the common stock of Nymox involves a high degree of risk. See "Risk Factors" beginning on Page 3. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is ____, 2003. TABLE OF CONTENTS ----------------- Page ---- RISK FACTORS..................................................................1 ENFORCEABILITY OF CERTAIN CIVIL LIABILITIES AND AUTHORIZED REPRESENTATIVE IN THE UNITED STATES.........................................7 ABOUT NYMOX....................................................................8 RECENT DEVELOPMENT............................................................10 WHERE YOU CAN FIND MORE INFORMATION ABOUT NYMOX...............................10 USE OF PROCEEDS...............................................................11 PRICE RANGE OF COMMON SHARES..................................................11 OUTSTANDING WARRANTS AND OPTIONS..............................................13 CAPITALIZATION................................................................13 THE SECURITIES BEING OFFERED..................................................14 PLAN OF DISTRIBUTION..........................................................15 SELLING SHAREHOLDER...........................................................16 CERTAIN LEGAL MATTERS.........................................................16 EXPERTS.......................................................................16 -i- RISK FACTORS An investment in shares of common stock of Nymox involves a high degree of risk. You should carefully consider each of the risks and uncertainties described below along with all of the other information in this prospectus and in the documents incorporated by reference into this prospectus before deciding to invest in these shares. It is Uncertain When, if Ever, We Will Make a Profit We first began operations in 1995 and are only in the early stages of commercial marketing of our diagnostic products, AlzheimAlert(TM), NicAlert(TM) and NicoMeter(TM). We have never made a profit. We incurred a net loss of $4.8 million in 1998, $3.3 million in 1999, $4.0 million in 2000 and $3.0 million in 2001. As of December 31, 2001, Nymox's accumulated deficit was $23.1 million. We cannot say when, if ever, Nymox will become profitable. Profitability will depend on our uncertain ability to generate revenues from the sale of our products and the licensing of our technology in order to offset the significant expenditures required for us to advance our research, protect and extend our intellectual property and develop, manufacture, license, market, distribute and sell our technology and products successfully. Similar types of expenditures in the past have helped produce the net losses reported above. We May Not Be Able to Raise Enough Capital to Develop and Market Our Products Nymox has funded its operations primarily by selling shares of its common stock. Since late 1998, a small portion of the funds came from sales. However, sales have not been, and may not be in the foreseeable future, sufficient to meet our anticipated financial requirements. We will continue to need to raise substantial amounts of capital for our business activities including our research and development programs, the conduct of clinical trials needed to obtain regulatory approvals and the marketing and sales of our products. We anticipate being able to fund our current total annual budgeted expenditures of approximately $3 million per year over the next year through our current cash position and additional financing including draw downs through our common stock private purchase agreement with Lorros-Greyse Investments, Inc. Clinical trials will substantially increase cash requirements. We anticipate being able to meet these requirements as they arise. Any necessary clinical trials for regulatory approval following successful preliminary clinical trials will require considerably more capital. We plan to raise such capital either through a new round of financing and/or through partnering with a major pharmaceutical company. Additional financing may not be available when needed, or, if available, may not be available on acceptable terms. If adequate funds on acceptable terms are not available, we may have to curtail or eliminate expenditures for research and development, testing, clinical trials, promotion and marketing for some or all of our products. We Face Challenges in Developing and Improving Our Products Our success depends on our ability to develop or acquire rights to new products or to improve our existing products. We are still developing many of our products and have not yet brought them to market. We cannot assure you that we will be able to develop or acquire rights to such products and to market them successfully. Developing a treatment for Alzheimer's disease is particularly challenging. Many pharmaceutical companies, institutions and researchers are working on many different approaches and treatments. There is no consensus among researchers about the cause of this fatal illness and no guarantee that our drug development programs in this area are targeting significant factors in its cause, progression or symptoms. It is difficult to design drug candidates that can cross from the bloodstream into the brain, where the damage from Alzheimer's disease is occurring. Clinical trials to establish efficacy for drugs that slow -1- down the progression of Alzheimer's disease over a period of months or years often require that a large number of subjects be tracked over many months or years, making them very expensive to conduct. The potentially long period from discovery and patenting through development and regulatory approval to the market can significantly reduce the patent life of an Alzheimer's disease treatment. Any marketed treatment in this area may well eventually face competition from "me-too" drugs developed by other pharmaceutical companies based on our research. We will be under constant competitive pressure to improve our products and to develop new treatments in order to protect our position in the field. Developing and improving our diagnostic products is also challenging. The science and technology of the detection and measurement of very small amounts of biochemicals in bodily fluids and tissue is evolving rapidly. We may need to make significant expenditures in research and development costs and licensing fees in order to take advantage of new technologies. If any major changes to our testing technologies used in our AlzheimAlert(TM) and NicAlert(TM) and NicoMeter(TM) tests are made, further validation studies will be required. Developing new diagnostic products is more challenging, requiring identification and validation of the biochemical marker being detected by the new product in the clinical context and the development and validation of the product designed to detect the marker. We Face Significant and Growing Competition The modern pharmaceutical and biotechnology industries are intensely competitive, particularly in the field of Alzheimer's disease where there is a large unmet need for an effective treatment. Currently there are four drugs with the same mechanism of action approved for sale in the United States (Aricept(R), Cognex(R), Exelon(R) and Reminyl(R)). These drugs offer some relatively short-tem symptomatic relief, but do not treat the underlying causes of the illness. Over the past decade, there has been an intense research effort both in the non-profit sectors such as universities, government agencies and research institutes and in the pharmaceutical and biotechnology industry to develop new treatments for Alzheimer's disease. Treatment candidates under development include: o vaccines for Alzheimer's disease. o enzyme-blocking therapies intended to block the production of the protein found in the senile plaques characteristic of Alzheimer's disease. A number of pharmaceutical and biotechnology companies including Amgen and Bristol-Myers Squibb are working on such therapies. o Memantine, a drug originally developed by Merz + Co. of Germany and being developed in the United States by Forest Laboratories, Inc. and Neurobiological Technologies, Inc., intended to reduce cell death and injury said to be caused by the release of too much of a signal transmitter in the brain called glutamate. The developers have applied to the FDA for its approval for use in the United States to treat Alzheimer's disease. o implantation of a shunt (COGNIShunt(TM)) developed by its maker, Eunoe Inc., and designed to drain cerebrospinal fluid from the patient's skull into his or her abdominal cavity. o implantation of genetically modified cells that produce human nerve growth factor into the brains of people with Alzheimer's disease. Preliminary human testing began this year at the University of California at San Diego in conjunction with the Salk Institute for Biological Studies. There is also ongoing research into possible methods of preventing Alzheimer's disease such as taking certain cholesterol-lowering drugs called statins, estrogen replacement therapies, anti-oxidants such as vitamin E and ginkgo biloba or anti-inflammatory drugs such as ibuprofen (e.g., Advil(R) or Motrin(R)). The successful development of a treatment or method of preventing Alzheimer's disease could significantly impact on our ability to develop or market a competing treatment for Alzheimer's disease. -2- Our treatments under development for enlarged prostate (benign prostatic hyperplasia or BPH) face significant competition from existing products. There are five drugs approved for treatment of BPH: finasteride (Proscar(R)), terazozin (Hytrin(R)), doxazozin (Cardur(R)), tamsulosin (Flomax(R)) and prazosin (Minipres(R)). There are a number of thermal treatments on the market designed to shrink the enlarged prostate by heating its tissue with a device inserted through the urethra (the tube leading from the bladder through the penis through which men urinate) or through the abdomen. The devices on the market use microwave energy (Prostatron(R), Targis Therapy(R) or TherMatrx(R)), low level radiowaves (TUNA System(R)), lasers (Indigo LaserOptic Treatment System(R)), direct heat or hot water to heat or burn away prostate tissue. A variety of surgical procedures exist to surgically reduce or remove the prostate or to widen the urethra. These include procedures to cut away prostate tissue which as TURP (transurethral resection of the prostate) and using a resectoscope with an electrical loop inserted through the penis to cut the prostate tissue. A small device used to widen the constricted urethra called a prostatic stent can also be inserted. The diagnostic testing industry is also highly competitive. In the area of Alzheimer's disease, Athena Diagnostics, Inc. markets diagnostic tests for different biochemical indicators found in blood and spinal fluid and for genetic predispositions for the illness. Other companies are attempting to develop and market other diagnostic products in this area. The introduction of other diagnostics products for Alzheimer's disease or tobacco product use that are cheaper, easier to perform, more accurate or otherwise more attractive to the physicians, health care payers or other potential customers would have a significant impact on the sales of our AlzheimAlert(TM), NicAlert(TM) or NicoMeter(TM) products. We May Not Be Able to Successfully Market Our Products To increase our marketing, distribution and sales capabilities both in the United States and around the world, we will need to enter into licensing arrangements, contract sales agreements and co-marketing deals. We cannot assure you that we will be able to enter into agreements with other companies on terms acceptable to us, that any licensing arrangement will generate any revenue for the company or that the costs of engaging and retaining the services of a contract sales organization will not exceed the revenues generated. Our Products and Services May Not Receive Necessary Regulatory Approvals Our diagnostic products, AlzheimAlert(TM), NicAlert(TM) and NicoMeter(TM), and our products in development, are subject to a wide range of government regulation governing laboratory standards, product safety and efficacy. The actual regulatory schemes in place vary from country to country and regulatory compliance can take several years and involve substantial expenditures. We cannot be sure that we can obtain necessary regulatory approvals on a timely basis, if at all, for our products in development and all of the following could have a material adverse effect on our business: o failure to obtain or significant delays in obtaining requisite approvals; o loss of or changes to previously obtained approvals; and o failure to comply with existing or future regulatory requirements. We currently market AlzheimAlert(TM) as a clinical reference laboratory service provided by our government-inspected clinical reference laboratory in New Jersey. Physicians send us urine samples from their patients to our laboratory where the AlzheimAlert(TM) test is performed and the results reported back to the physicians. A clinical laboratory test like AlzheimAlert(TM) does not require approval from the United States Food and Drug Administration (FDA). Our laboratory is regulated by the Centers for Medicare & Medicaid Services (CMS) under the Clinical Laboratory Improvement Amendments and is subject to inspection and -3- certification. In addition, individual states like New York and Florida have their own requirements for reference laboratories like ours that offer diagnostic services. In addition, the FDA has its own regulations governing in vitro diagnostic products, including some of the reagents used in clinical reference laboratories. Any changes in CMS or state law requirements or in the FDA regulations could have a detrimental impact on our ability to offer or market any reference laboratory services and/or on our ability to obtain reimbursement from the Medicare and Medicaid programs and providers. We may develop a diagnostic kit based on AlzheimAlert(TM) for sale to third parties. If so, we will require prior approval from the FDA before we can market, distribute or sell such a product in the United States. We have not submitted any such product to the FDA for approval. In general, such approval requires clinical testing as to the safety and efficacy of the device and preparation of an approval application with extensive supporting documentation. If approved, the device would then be subject to postmarketing record and reporting obligations and manufacturing requirements. Similar requirements exist in many other countries. Obtaining these approvals and complying with the subsequent regulatory requirements can be both time-consuming and expensive. We currently sell NicAlert(TM) and NicoMeter(TM) as tests for tobacco product use and for research use. In October, 2002, we received 510(k) clearance from the U.S. Food and Drug Administration for our NicAlert(TM) product. In the United States, our drugs in development will require FDA approval, which comes only at the end of a lengthy, expensive and often arduous process. We have not submitted any drugs for FDA approval. We have begun Phase I safety studies for NX-1207, our investigational new drug for benign prostatic hyperplasia (BPH). We cannot predict with any certainty the amount of time the FDA will take to approve one of our drugs or even whether any such approval will be forthcoming. Similar requirements exist in many other countries. Protecting Our Patents and Proprietary Information is Costly and Difficult We believe that patent and trade secret protection is important to our business, and that our success will depend, in part, on our ability to obtain strong patents, to maintain trade secret protection and to operate without infringing the proprietary rights of others. Obtaining and maintaining our patent position is costly. We pay for the filing, prosecution and fees of over 200 patents and patent applications in countries around the world, including the United States, Europe, Japan, Canada, Australia, New Zealand and South Korea. In the United States alone, Nymox has fourteen patents issued or allowed and at least eleven patent applications pending relating to its technology. Its subsidiary, Serex Inc. has nine patents issued and allowed. Through licensing agreements with the Massachusetts General Hospital, Nymox separately licensed global patent rights relating to neural thread proteins and to novel cancer markers that have potential application both for the treatment and diagnosis of specific cancers. These licensed patent rights include five issued United States patents and numerous patents and patent application in other countries around the world. We believe that we have strong patent protection for the products we sell and for our product development programs and are in the process of extending that patent protection to cover more countries or new discoveries or products. We cannot assure you that additional patents covering new products or improvements will be issued or that any new or existing patents will be of commercial benefit or be valid and enforceable if challenged. We are not currently involved in patent litigation. In the pharmaceutical and biotechnology industry patent disputes are frequent and can preclude the commercialization of products. Patent litigation is costly and the outcome often difficult to predict. It can expose us to significant liabilities to third parties and -4- may require us to obtain third-party licenses at a material cost or cease using the technology or product in dispute. We Face Changing Market Conditions The healthcare industry is in transition with a number of changes that affect the market for therapeutic and diagnostic test products. The U.S. Federal and various state governments have under consideration a number of proposals that may have the effect of directly or indirectly limiting drug prices in the U.S. markets. Such changes may adversely affect the prices we may charge for any therapeutic drug we develop. Funding changes and budgetary considerations can lead major health care payers and providers to make changes in reimbursement policies for our AlzheimAlert(TM) product. These changes can seriously impact the potential for growth for the market for AlzheimAlert(TM), either favorably when the decision is to offer broad coverage for our test at a reasonable price or negatively when the decision is to deny coverage altogether. Changes in the healthcare delivery system have resulted in major consolidation among reference laboratories and in the formation of multi-hospital alliances, reducing the number of institutional customers for therapeutic and diagnostic test products. There can be no assurance that Nymox will be able to enter into and/or sustain contractual or other marketing or distribution arrangements on a satisfactory commercial basis with these institutional customers. Health Care Plans May Not Cover or Adequately Pay for our Products and Services Throughout the developed world, both public and private health care plans are under considerable financial and political pressure to contain their costs. The two principal methods of restricting expenditures on drugs and diagnostic products and services are to deny coverage or, if coverage is granted, to limit reimbursement. For single-payer government health care systems, a decision to deny coverage or to severely restrict reimbursement for one of our products can have an adverse effect on our business and revenues. In the United States, where, to a significant degree, the patient population for our products is elderly, Medicare and Medicaid are sources of reimbursement. In general, any restriction on reimbursement, coverage or eligibility under either program could adversely affect reimbursement to Nymox for products and services provided to beneficiaries of the Medicare and/or Medicaid programs. Many elderly people are covered by a variety of private health care organizations either operating private health care plans or Medicare or Medicaid programs subject to government regulation. These organizations are also under considerable financial constraints and we may not be able to secure coverage or adequate reimbursement from these organizations. Without coverage, we will have to look to the patients themselves who may be unwilling or unable to pay for the product; in turn, doctors may be reluctant to order or prescribe our products in the absence of coverage of the product for the patient. The Future Sale of Eligible Shares may Dilute Nymox's Stock Price The issuance of further shares and the eligibility of issued shares for sale will dilute our common stock and may lower its share price. There were 23,020,954 common shares of Nymox issued and outstanding as of December 31, 2002. All of these shares are eligible for sale under Rule 144 or are otherwise freely tradable. In addition, 1,654,000 share options were outstanding on that date, of which 1,489,000 are currently vested, and 611,860 shares are subject to issuance upon exercise of warrants. The great majority of the Nymox options expire in 3 to 8 years. These options have been granted to employees, officers, directors and consultants of the company. Moreover, Nymox may use its shares as currency in acquisitions. We Face Potential Losses Due to Foreign Currency Exchange Risks Nymox incurs certain expenses, principally relating to salaries and operating expenses at its Canadian head office, in Canadian dollars. All other expenses are derived in U.S. dollars. As a result, we are -5- exposed to the risk of losses due to fluctuations in the exchange rates between the U.S. dollar and the Canadian dollar. We protect ourselves against this risk by maintaining cash balances in both currencies. We do not currently engage in hedging activities. We cannot say with any assurance that the Company will not suffer losses as a result of unfavorable fluctuations in the exchange rates between the United States dollar and Canadian dollar. We Have Never Paid a Dividend and are Unlikely to do so in the Foreseeable Future Nymox has never paid any dividends and does not expect to do so in the foreseeable future. We expect to retain any earnings or positive cash flow in order to finance and develop Nymox's business. Cautionary Statement Regarding Forward-Looking Statements You should be aware that this prospectus and certain documents incorporated herein by reference contains forward-looking statements about, among other things, the anticipated operations, product development, financial condition and operating results of Nymox, proposed clinical trials and proposed transactions, including collaboration agreements. By forward-looking statements, we mean any statements that are not statements of historical fact, including (but are not limited to) statements preceded by or that include the words, "believes", "expects", "anticipates", "hopes", "targets" or similar expressions. In connection with the "safe harbor" provisions in the Private Securities Litigation Reform Act of 1995, we are including this cautionary statement to identify some of the important factors that could cause Nymox's actual results or plans to differ materially from those projected in forward-looking statements made by, or on behalf of, Nymox. These factors, many of which are beyond the control of Nymox, include Nymox's ability to: o identify and capitalize on possible collaboration, strategic partnering or divestiture opportunities; o obtain suitable financing to support its operations and clinical trials; o manage its growth and the commercialization of its products; o achieve operating efficiencies as it progresses from a development-stage to a later-stage biotechnology company; o successfully compete in its markets; o realize the results it anticipates from the clinical trials of its products; o succeed in finding and retaining joint venture and collaboration partners to assist it in the successful marketing, distribution and commercialization of its products; o achieve regulatory clearances for its products; o obtain on commercially reasonable terms adequate product liability insurance for its commercialized products; o adequately protect its proprietary information and technology from competitors and avoid infringement of proprietary information and technology of its competitors; -6- o assure that its products, if successfully developed and commercialized following regulatory approval, are not rendered obsolete by products or technologies of competitors; and o not encounter problems with third parties, including key personnel, upon whom it is dependent. Although Nymox believes that the forward-looking statements contained in this registration statement are reasonable, it cannot ensure that its expectations will be met. These statements involve risks and uncertainties. Actual results may differ materially from those expressed or implied in these statements. Factors that could cause such differences include, but are not limited to, those discussed under "Risk Factors." You may request a copy of these filings, at no cost, by writing or telephoning Nymox at the following address: Nymox Pharmaceutical Corporation 9900 Cavendish Blvd., Suite 306 St. Laurent, QC, Canada H4M 2V2 (514) 332-3222 You should rely only on the information that we incorporate by reference or provide in this prospectus. We have not authorized anyone to provide you with different information. We are not making an offer of these securities in any jurisdiction where the offer is not permitted. You should not assume that the information in this prospectus is accurate as of any date other than the date on the front of this prospectus. ENFORCEABILITY OF CERTAIN CIVIL LIABILITIES AND AUTHORIZED REPRESENTATIVE IN THE UNITED STATES Many of Nymox's directors, officers and certain experts named in this prospectus are residents of Canada. Consequently, it may be difficult for United States investors to effect service within the United States upon Nymox's directors, officers or certain experts named in this prospectus, or to realize in the United States upon judgments of courts of the United States predicated upon civil liabilities under the Securities Act. A judgment of a court of the United States predicated solely upon such civil liabilities would probably be enforceable in Canada by the Canadian court if the United States court in which the judgment was obtained had jurisdiction, as determined by the Canadian court, in the matter. There is substantial doubt whether an original action could be brought successfully in Canada against any of such persons or Nymox predicated solely upon such civil liabilities. The authorized agent to receive service of process in the United States is CT Corporation System, 111 Eighth Ave., 13th Floor, New York, NY, 10011, telephone (212) 590-9200. -7- ABOUT NYMOX Nymox is a development stage biopharmaceutical company based in Maywood, New Jersey and Saint Laurent, Quebec, Canada. Nymox was incorporated in May, 1995 to acquire all of the common shares of DMS Pharmaceutical Inc., a private company which, since 1989, conducted research and development on diagnostics and drugs for brain disorders and diseases of the aged with an emphasis on Alzheimer's disease. We specialize in the research and development of therapeutics and diagnostics for the aging population with an emphasis on Alzheimer's disease. Alzheimer's disease is a progressive, terminal brain disease of the elderly marked by an irreversible decline in mental abilities, including memory and comprehension, and often accompanied by changes in behavior and personality. It currently afflicts an estimated four million people in the United States and at least fifteen million people worldwide. As the baby-boomer generation continues to age, these figures are expected to rise sharply. AlzheimAlert(TM), an Aid for the Diagnosis of Alzheimer's Disease We market a proprietary diagnostic test for Alzheimer's disease, known as AlzheimAlert(TM), through our clinical reference laboratory in Maywood, New Jersey. AlzheimAlert(TM) is an improved version of our AD7C(TM) test, which has been on the market since 1997. It measures the level in urine of a brain protein called neural thread protein which is elevated early in Alzheimer's disease. The test helps physicians make an early diagnosis of the disease. The early diagnosis of Alzheimer's disease is important to physicians, patients and their families. It enables them to make informed and early social, legal and medical decisions about treatment and care. It permits patients to take advantage of new improvements in drug treatment and care. Even a modest delay in institutionalization can mean substantial social and financial savings. There is a widely recognized need for a simple, accurate and convenient test that can help physicians diagnose Alzheimer's disease. Chapter 5 of the Surgeon General's Report on Mental Health is indicative of this recognition. In this Report, the Surgeon General described the diagnosis of Alzheimer's disease as "challenging" and its early detection as "difficult." As a result, Alzheimer's disease and other dementias, the Surgeon General's report states, are "currently underrecognized, especially in primary care settings, where most older patients seek care." AlzheimAlert(TM) is one of a variety of diagnostic testing methodologies, technologies and products that have been recently developed to aid physicians in the diagnosis of Alzheimer's disease. It is the only commercially available urine test for this purpose and tests for a unique, proprietary marker, neural thread protein. Two Principal Programs to Develop Treatments for Alzheimer's Disease We have two principal programs to develop treatments of Alzheimer's disease. The first program targets neural thread protein, the brain protein detected by AlzheimAlert(TM), and its role in the extensive brain cell loss associated with Alzheimer's disease. The second program is based on spherons. Nymox researchers believe spherons are a source of senile plaques, the characteristic abnormality found in abundance in the brains of patients with Alzheimer's disease and widely believed to play a major role in the cause and course of the illness. These programs are in the development stage. We cannot assure you that these programs will produce effective and marketable treatments for Alzheimer's disease. The research may fail or the compounds may not receive necessary regulatory approval. As a development stage company, we may partner with a major pharmaceutical company in the conduct of necessary human clinical trials, to finish product -8- development, to obtain regulatory approval, and ultimately to market any product. There is no guarantee we will be able to enter into such a partnership arrangement on satisfactory terms. Neural Thread Protein Based Drugs There is a body of scientific and medical evidence showing that neural thread protein, the brain protein detected by our AlzheimAlert(TM) test, may play a key role in Alzheimer's disease. We are developing compounds that can impede the effects of neural thread protein and thus potentially slow or halt the progression of Alzheimer's disease. We licensed the basic technology to develop such compounds including patent rights in 1997 from the Massachusetts General Hospital as part of a sponsored research and licensing agreement and have a similar licensing arrangement with the Rhode Island Hospital. Drugs Targeting Spherons We are a world leader in research and development into drugs for the treatment of Alzheimer's disease that target spherons. Spherons are tiny balls of densely packed protein found in brain cells scattered throughout the brains of all humans from age one. They were first discovered, characterized and isolated by Nymox researchers. We believe that spherons are a cause of senile plaques and that stopping or inhibiting the transformation of spherons into senile plaques will help stop or slow the progression of Alzheimer's disease. You should be aware that there is no consensus among researchers about the causes or possible treatments of Alzheimer's disease and that not all researchers share this belief that spherons are the cause of Alzheimer's disease or are a target for the development of treatments for the disease. We developed and patented novel, proprietary drug screening methods based on spherons and now have several drug candidates which have shown promise in animal and other preclinical studies and for which we plan to seek regulatory approval to being clinical studies for humans. We hold global patent rights covering both methods for using spherons as targets for developing drugs and for the actual drug candidates discovered. The Use of Statin Drugs for the Treatment or Prevention of Alzheimer's Disease In October 2002, we were issued a United States patent for the use of statin drugs to treat, prevent or reduce the risk of the onset of Alzheimer's disease. Statins are a class of commonly prescribed cholesterol lowering drugs that have a well-established safety record and are widely available. A number of published studies showed a link between statin use and lower incidence of Alzheimer's disease. Research in this area is ongoing and no statin drug has been approved for use in the treatment or prevention of Alzheimer's disease. New Antibacterial Agents Against Infections and Food Contamination We are developing new antibacterial agents. One agent has proven effective against the E. coli O157:H7 bacteria which can cause serious contamination in meat and other food and drink products. We are developing treatments for E. coli O157:H7 contamination of meat. We also have a series of collaboration agreements with universities and research institutions and a biotechnology company, Biophage Inc. We have also developed other new antibacterial agents that can potentially treat human disease such as difficult chronic and persistent urinary tract infections and streptococcal or staphylococcal infections. We hold patents rights in this area in the United States and Australia and are pursuing further patent rights both in the United States and in other countries. -9- Development of Therapeutic Products for Enlarged Prostate We are developing treatments for enlarged prostate (benign prostatic hyperplasia or BPH), using novel compounds. We have begun Phase 1 safety studies in humans for one treatment candidate, NX-1207. Enlarged prostate or BPH affects more than half of men in their sixties and as many as 90% of men in their seventies and eighties. Symptoms include more frequent urination (especially at night), difficulty urinating, incomplete emptying of the bladder and sometimes complete inability to urinate. More serious cases may require surgical intervention to reduce the size of the prostate and to remove it entirely. There is a need for a simple, effective treatment for BPH, particularly in cases where existing drug treatments have proven to be ineffective and where more intrusive procedures such as surgical cutting away of prostate tissue may be undesirable to the patient or bring unacceptable risks. The NicAlert(TM) and NicoMeter(TM) Tests for Tobacco Product Use We also market NicAlert(TM) and NicoMeter(TM), inexpensive, simple-to-use test strips that use urine or saliva (NicAlert(TM) only) to determine whether a person is using tobacco products. Both NicAlert(TM) and NicoMeter(TM) detect levels of cotinine, a byproduct of the body's breakdown of nicotine and generally regarded as the best indicator of tobacco exposure for smokers and nonsmokers. Both NicAlert(TM) and NicoMeter(TM) are currently being used in research programs into tobacco use and exposure and being marketed in the United States and Japan as tests to determine whether a person, such as a teenager, student athlete or insurance applicant, is using a tobacco product. In October 2002, NicAlert(TM) received FDA clearance. Both NicAlert(TM) and NicoMeter(TM) employ the patented technology of our subsidiary, Serex, Inc. RECENT DEVELOPMENT On January 27, 2003 we entered into a Common Stock Private Purchase Agreement with Lorros-Greyse Investments, Ltd., a Panamanian corporation, for the future issuance and sale of Nymox's common shares. Under the agreement, Lorros-Greyse is committed to purchase up to $5 million of Nymox's common shares over the twenty-four month period ending in January of 2005. From time to time during this period until the $5 million maximum is reached, Nymox may give Lorros-Greyse a draw notice to purchase up to $500,000 of Nymox's common shares. The price per common share for each purchase is equal to 97% of the average of the closing price of the common shares on the Nasdaq Small Cap Market for the five trading days preceding the day the draw notice is given to Lorros-Greyse. The sale of common shares to Lorros-Greyse and any resales of common shares by Lorros-Greyse are intended to be made pursuant to the exemption from registration provided by Registration S under the Securities Act of 1933, as well as any other available exemption from registration. On January 30, 2003, Lorros-Greyse purchased 107,382 of our common shares for $3.725 per share, or an aggregate of $400,000. This is the only draw to date under the Common Stock Private Purchase Agreement. WHERE YOU CAN FIND MORE INFORMATION ABOUT NYMOX Nymox files periodic reports and other information with the SEC. You may read and copy any document that Nymox files at the SEC's public reference room at 450 Fifth Street, N.W., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room. Nymox's common shares are listed on the Nasdaq SmallCap Market. You can consult reports and other information about Nymox that it filed pursuant to the rules of the Nasdaq Stock Market. -10- The SEC allows us to incorporate by reference the information we file with them. This means that we can disclose important information to you by referring to documents. The information that we incorporate by reference is an important part of this prospectus. We incorporate by reference the following documents and any future filings that we make with the SEC under Section 13(a), 13(c) and 15(d) of the Securities Exchange Act of 1934, as amended, until we complete the offerings using this prospectus: o Our Annual Report on Form 20-F for the fiscal year ended December 31, 2001; and o Our reports on Form 6-K furnished to the SEC since the end of the fiscal year covered by the Annual Report on Form 20-F referred to above. o All subsequent annual reports filed by Nymox on Form 20-F, all subsequent filings by Nymox on Form 6-K (but only to the extent that Nymox identifies in Form 6-K that it is being incorporated by reference into this prospectus), and all subsequent filings made under Sections 12, 13, 14 of 15(d) of the Securities Exchange Act dated after the date of this prospectus and before the termination of the offering are deemed incorporated by reference into, and to be a part of, this prospectus from the date such documents are filed. o All other reports filed by Nymox under Sections 13(a) or 15(d) of the Securities Exchange Act since the end of the fiscal year covered by the Annual Report on Form 20-F referred to above. Information that we file with the SEC will automatically update and supercede information in documents filed with the SEC at earlier dates. All information appearing in this prospectus is qualified in its entirety by the information and financial statements, including the notes, contained in the documents that we incorporate by reference in this prospectus. USE OF PROCEEDS We will not realize any proceeds from the sale of the common shares by Jaspas Investments Ltd.; rather, Jaspas will receive those proceeds directly. However, we will receive proceeds if and when Jaspas Investments Ltd. exercises the warrant to purchase the common shares. We intend to use the proceeds from the exercise of such warrant for working capital and other general corporate purposes. PRICE RANGE OF COMMON SHARES Nymox's common shares trade on the Nasdaq Stock Market. Nymox's common shares traded on the Nasdaq National Market from December 1, 1997 until September 16, 1999, when they began trading on the Nasdaq SmallCap Market. Nymox's common shares also traded on the Montreal Exchange from December 18, 1995 until November 19, 1999. The following tables set out the high and low reported trading prices of the common shares on the Nasdaq Stock Market during the periods indicated. Annual High and Low Market Prices - Past five years YEAR ANNUAL HIGH ANNUAL LOW ---- ----------- ---------- 1997 $10.750 $6.250 1998 $13.625 $2.500 1999 $ 5.875 $2.500 2000 $10.563 $1.063 2001 $ 4.910 $1.750 2002 $ 5.750 $2.800 2003 $ 4.400 $3.410 -11- Quarterly High and Low Market Prices - Past Two Years YEAR QUARTERLY PERIOD HIGH SALES PRICE LOW SALES PRICE - ---- ---------------- ---------------- --------------- 2001 1ST Quarter $3.000 $1.750 2nd Quarter $3.100 $1.760 3rd Quarter $4.910 $2.310 4th Quarter $5.000 $3.650 2002 1st Quarter $4.410 $3.500 2nd Quarter $4.750 $2.810 3rd Quarter $5.750 $3.050 4th Quarter $4.500 $2.800 2003 1st Quarter $4.400 $3.410 Monthly High and Low Market Prices - Most Recent Six Months DATE MONTHLY HIGH MONTHLY LOW - ---- ------------ ----------- September, 2002 $4.550 $3.050 October, 2002 $3.650 $2.800 November, 2002 $4.220 $3.460 December, 2002 $4.500 $3.320 January, 2003 $4.150 $3.410 February, 2003 $4.400 $4.160 -12- OUTSTANDING WARRANTS AND OPTIONS Description Warrants Issued Exercise Price Expiry Date - ----------- --------------- -------------- ----------- Series H 66,667 $9.375 Mar. 6, 2004 Series I 26,667 $7.8125 Mar. 6, 2004 Series E 200,000 $4.5315 Nov. 30, 2004 Series F 160,000 $4.0625 Nov. 30, 2004 Series G 109,879 $3.70 Jan. 8, 2005 Series G 5,783 $3.70 Jan. 8, 2005 Series J 42,864 $3.70 Jul. 31, 2005 The total number of shares subject to options at February 28, 2003 was 1,654,000, of which options representing 1,489,000 shares are currently exercisable. Of those, the total number of shares subject to options held by directors and officers of Nymox is 930,000, of which options representing 825,000 shares are currently exercisable. There are no rights, warrants or options presently outstanding under which Nymox could issue additional common shares, with the exception of options enabling certain directors, employees and consultants of Nymox to acquire common shares under Nymox's stock option plan as summarized in the preceding paragraph and of warrants entitling the holders to acquire up to 611,860 common shares of Nymox as outlined in the above table. CAPITALIZATION The following table sets forth our capitalization as of December 31, 2001. This table should be read in conjunction with the financial statements and related notes, and the "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in the documents incorporated by reference into this prospectus. Long term debt and capital lease obligations $0 ------------------ Shareholder's Equity: Share Capital and Other: Common stock, no par value; 22,297,525 shares issued and outstanding Shares authorized for issue: unlimited $25,376,557 Warrants 421,638 Accumulated deficit ($23,153,447) ------------------ Total shareholder's equity $2,644,748 ================== Total capitalization $2,644,748 ================== -13- THE SECURITIES BEING OFFERED This prospectus relates to the up to 200,000 Nymox common shares issuable to Jaspas Investments Ltd. upon exercise, in whole or in part, of a warrant Nymox issued to Jaspas Investments Ltd. Warrant Under the terms of the Stock Purchase Agreement, dated November 1, 1999, between Jaspas Investments Ltd. and Nymox, we granted Jaspas a warrant to purchase 200,000 shares of Nymox's common shares, exercisable for a period of five (5) years from November 30, 1999, at an exercise price equal to 110% of the average daily price of the common shares on the closing date of November 12, 1999. The average daily price of Nymox's shares for that day was $4.1097; thus the exercise price for the warrant is $4.5315. The warrant permits Jaspas to purchase up to 200,000 shares through one or more exercises of the warrant at any time after November 30, 1999 and before the close of business on November 30, 2004. Jaspas may also effect a cashless exercise of the warrant. Under a cashless exercise Jaspas may, in whole or in part, exercise the warrant without payment to Nymox of the exercise price and be entitled to receive the number of shares of Nymox equal to the quotient obtained by dividing [(A-B) (X)] by (A) where: A = the average of the high and low trading prices per share of Common Stock on the Trading Day preceding the date of such election on the Nasdaq Stock Market, or if the Common Stock is not traded on the Nasdaq Stock Market, then the principal market in terms of volume, and converted into US Dollars; B = the Exercise Price of the Warrants; and X = the number of shares issuable upon exercise of the Warrants in accordance with the terms of this Warrant. Common Shares Our articles of incorporation authorize the issuance of an unlimited number of common shares. They do not authorize the issuance of any other class of shares. As of December 31, 2002, 23,020,954 common shares of Nymox were issued and outstanding. The holders of the common shares of our Company are entitled to receive notice of and to attend all meetings of the shareholders of our Company and have one vote for each common share held at all meetings of the shareholders of our Company. Our directors are elected at each annual meeting of shareholders and do not stand for reelection at staggered intervals. The holders of common shares are entitled to receive dividends and our company may pay dividends, as and when declared by our board of directors, out of moneys properly applicable to the payment of dividends, in such amount and in such form as our board of directors may from time to time determine, and all dividends which our board of directors may declare on the common shares shall be declared and paid in equal amounts per share on all common shares at the time outstanding. Nymox has never declared a dividend on the common shares and has no present intention of ever paying such a dividend. In the event of the dissolution, liquidation or winding-up of the company, whether voluntary or involuntary, or any other distribution of assets of the company among its shareholders for the purpose of winding up its affairs, the holders of the common shares will be entitled to receive the remaining property and assets of the company. -14- PLAN OF DISTRIBUTION We are registering the resale by Jaspas Investments Ltd. of common shares issuable to Jaspas upon exercise of the warrant issued to Jaspas on November 1999. Nymox will not receive any sales proceeds from Jaspas' sale of these shares. All costs, expenses and fees in connection with the registration of the common shares offered by this prospectus will be borne by Nymox. Brokerage commissions and similar selling expenses, if any, attributable to the sale of common shares will be borne by Jaspas. Sales of common shares pursuant to this prospectus may be effected by Jaspas from time to time in one or more types of transactions (which may include block transactions) on the Nasdaq SmallCap Market or on any other exchange in which the common shares are listed. Jaspas can sell the shares in negotiated transactions, through put or call options transactions relating to the common shares, through short sales of common shares, or a combination of such methods of sale, at market prices prevailing at the time of sale, at negotiated prices or at fixed prices, which may be changed. These transactions may or may not involve brokers or dealers. Jaspas Investments Ltd. may sell the shares directly to purchasers or to or through broker-dealers, which may act as agents or principals. The broker-dealers may receive compensation in the form of discounts, concessions or commissions from Jaspas and/or the purchasers of common shares for who such broker-dealers may act as agents or to whom they sell as principal, or both (which compensation as to a particular broker-dealer might be in excess of customary commissions). Jaspas and any broker-dealer that acts in connection with the sale of common shares may be deemed to be an "underwriter" within the meaning of Section 2(a)(11) of the Securities Act of 1933, and any commissions received by such broker-dealers and any profit on the resale of the common shares sold by them while acting as principals will be deemed to be underwriting discounts or commissions under the Securities Act. Jaspas may agree to indemnify any agent, dealer or broker-dealer that participates in transactions involving sales of the common shares against certain liabilities, including liabilities arising under the Securities Act. Because Jaspas may be deemed to be an "underwriter" within the meaning of Section (2)(a)(11) of the Securities Act, it will be subject to the prospectus delivery requirements of the Securities Act. If Jaspas Investments Ltd. notifies us that it has entered into any material arrangement with a broker-dealer for the sale of Nymox common shares through a block trade, special offering, exchange distribution or secondary distribution or a purchase by a broker or dealer, we will file a supplement to this prospectus, if required, pursuant to Rule 424(b) under the Securities Act, disclosing: o the name of the participating broker-dealer(s); o the number of shares involved; o the price at which such shares were sold o the commission paid or discounts or concessions allowed to the broker-dealer(s), where applicable; o whether the broker-dealer(s) conducted any investigations to verify the information in or incorporated by reference in this prospectus; and o other material facts of the transactions. -15- SELLING SHAREHOLDER Jaspas Investments Ltd. has informed us that it does not presently own any common shares of Nymox Pharmaceutical Corporation. Jaspas' principal offices are located in the British Virgin Islands, c/o Beacon Capital Management, Harbour House, 2nd Floor, Waterfront Drive, Road Town, Tortals, British Virgin Islands. CERTAIN LEGAL MATTERS The validity of the common shares offered hereby will be passed upon for Nymox by Jack Gemmell, General Counsel of Nymox. EXPERTS The financial statements of Nymox as of December 31, 2001, 2000 and 1999 and for each of the years in the three year period ended December 31, 2001 have been incorporated by reference in this prospectus and in the registration statement in reliance upon reports of KPMG LLP, independent auditors, and upon the authority of KPMG LLP as experts in accounting and auditing. -16- ================================================================================ Up to 200,000 Common Shares offered by Jaspas Investments Ltd. NYMOX PHARMACEUTICAL CORPORATION P R O S P E C T U S __, 2003 ================================================================================ PART II INFORMATION NOT REQUIRED IN PROSPECTUS Item 8: INDEMNIFICATION OF DIRECTORS AND OFFICERS Nymox maintains Directors' and Officers' Liability Insurance (the "Policy") for its own benefit and for the benefit of its subsidiaries and their respective directors and officers. Subject to the limitations therein set forth, the Policy extends coverage to directors and officers for any loss (as defined in the Policy) incurred in connection with the performance of their duties and to Nymox and its subsidiaries for any loss for which they have indemnified their respective directors or officers as permitted by law. Section 124 of the Canada Business Corporations Act ("CBCA") provides: Indemnification 124. (1) A corporation may indemnify a director or officer of the corporation, a former director or officer of the corporation or another individual who acts or acted at the corporation's request as a director or officer or an individual acting in a similar capacity, of another entity, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by the individual in respect of any civil, criminal, administrative, investigative or other proceeding in which the individual is involved because of that association with the corporation or other entity. Advance of costs (2) A corporation may advance moneys to a director, officer or other individual for the costs, charges and expenses of a proceeding referred to in subsection (1). The individual shall repay the moneys if the individual does not fulfil the conditions of subsection (3). Limitation (3) A corporation may not indemnify an individual under subsection (1) unless the individual (a) acted honestly and in good faith with a view to the best interests of the corporation, or, as the case may be, to the best interests of the other entity for which the individual acted as director or officer or in a similar capacity at the corporation's request; and (b) in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, the individual had reasonable grounds for believing that the individual's conduct was lawful. Indemnification in derivative actions (4) A corporation may, with the approval of a court, indemnify an individual referred to in subsection (1), or advance moneys under subsection (2), in respect of an action by or on behalf of the corporation or other entity to procure a judgment in its favour, to which the individual is made a party because of the individual's association with the corporation or other entity as described in subsection (1) against all costs, charges and expenses reasonably incurred by the individual in connection with such action, if the individual fulfills the conditions set out in subsection (3). Right to indemnity (5) Despite subsection (1), an individual referred to in that subsection is entitled to indemnity from the corporation in respect of all costs, charges and expenses reasonably incurred by the individual in connection with the defence of any civil, criminal, administrative, investigative or other proceeding to which the individual is subject because of the individual's association with the corporation or other entity as described in subsection (1), if the individual seeking indemnity (a) was not judged by the court or other competent authority to have committed any fault or omitted to do anything that the individual ought to have done; and (b) fulfils the conditions set out in subsection (3). Insurance (6) A corporation may purchase and maintain insurance for the benefit of an individual referred to in subsection (1) against any liability incurred by the individual (a) in the individual's capacity as a director or officer of the corporation; or (b) in the individual's capacity as a director or officer, or similar capacity, of another entity, if the individual acts or acted in that capacity at the corporation's request. Application to court (7) A corporation, an individual or an entity referred to in subsection (1) may apply to a court for an order approving an indemnity under this section and the court may so order and make any further order that it sees fit. Notice to Director (8) An applicant under subsection (7) shall give the Director notice of the application and the Director is entitled to appear and be heard in person or by counsel. Other notice (9) On an application under subsection (7) the court may order notice to be given to any interested person and the person is entitled to appear and be heard in person or by counsel. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers or persons controlling the Registrant pursuant to the foregoing provisions, the Registrant has been informed that in the opinion of the United States Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is therefore unenforceable. Item 9. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES EXHIBIT NO. DESCRIPTION ----------- ----------- 4.0 Stock Purchase Warrant issued to Jaspas Investments Ltd. dated November 1, 1999 [Incorporated by reference to Exhibit 2.3 to Nymox Pharmaceutical Corporation's Registration Statement on Form F-1 (File No. 333-31310)] 5.0 Opinion of Jack Gemmell, General Counsel of Nymox 10.0 Common Stock Private Purchase Agreement dated as of January 27, 2003, by and between the Company and Lorros-Greyse Investments, Ltd. 23.1 Consent of KPMG LLP 23.2 Consent of Jack Gemmell, General Counsel to Nymox (included in opinion filed herewith as Exhibit 5.0) 24.0 Powers of Attorney (contained as part of the signature page) Item 17. UNDERTAKINGS The undersigned Registrant hereby undertakes: 1. To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement; (i) To include any prospectus required by section l0(a)(3) of the Securities Act of 1933, as amended ("Securities Act"). (ii) To reflect in the prospectus included in this registration statement any facts or events arising after the effective date of this registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in this registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Securities and Exchange Commission ("SEC") pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in this registration statement. provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in the periodic reports filed by the Registrant pursuant to Section 13 or 15(d) of the Exchange Act, that are incorporated by reference in this registration statement; 2. For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. 3. To remove from registration by means of a post-effective amendment any of the securities being registered, which remain unsold at the termination of the offering. 4. To file a post-effective amendment to the registration statement to include any financial statements required by Item 8.A. of Form 20-F at the start of any delayed offering or throughout a continuous offering. Financial statements and information otherwise required by Section 10(a)(3) of the Act need not be furnished, provided that the registrant includes in the prospectus, by means of a post-effective amendment, financial statements required pursuant to this paragraph (a)(4) and other information necessary to ensure that all other information in the prospectus is at least as current as the date of those financial statements. Notwithstanding the foregoing, with respect to registration statements on Form F-3, a post-effective amendment need not be filed to include financial statements and information required by Section 10(a)(3) of the Act if such financial statements and information are contained in periodic reports filed with or furnished to the Commission by the registrant pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the Form F-3. 5. The undersigned registrant hereby further undertakes that, for purposes of determining any liability under the Securities Act, each filing of the registrant's annual report pursuant to Section 13(a) or 15(d) of the 1934 Act that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. 6. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the provisions described under Item 8 above, or otherwise, the Registrant has been advised that in the opinion of the Securities Exchange Commission such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether such indemnification by it is against public policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue. SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Montreal, Country of Canada, on this 12th day of March, 2003. NYMOX PHARMACEUTICAL CORPORATION By: /s/ Paul Averback, M.D. -------------------------------------- Paul Averback, M.D. President and Chief Executive Officer Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed below by the following persons in the capacities indicated as of this 12th day of March, 2003. Each person whose signature appears below constitutes and appoints Dr. Paul Averback and Roy Wolvin, and each of them individually, his or her true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this Registration Statement and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto each said attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and necessary to be done, as fully as he or she might or could do in person, hereby ratifying and confirming all that each said attorney-in-fact and agent may lawfully do or cause to be done by virtue hereof.
/s/ Jack Gemmell /s/ Paul Averback, M.D. /s/ Roy Wolvin - ----------------------------- ----------------------------- ----------------------------- Jack Gemmell Paul Averback, M.D. Roy Wolvin Director President and Chief Executive Chief Financial Officer and Officer and Director Secretary-Treasurer (Principal Executive Officer) (Principal Financial and Accounting Officer) /s/ Walter von Wartburg /s/ Hans Black, M.D. /s/ Michael R. Sonnenreich - ----------------------------- ----------------------------- ----------------------------- Walter von Wartburg Hans Black, M.D. Michael R. Sonnenreich Director Director Director
NYMOX CORPORATION (Authorized Representative in the United States) By: /s/ Roy Wolvin ------------------------- Roy Wolvin Secretary-Treasurer EXHIBIT INDEX EXHIBIT NO. DESCRIPTION ----------- ----------- 4.0 Stock Purchase Warrant issued to Jaspas Investments Ltd. dated November 1, 1999 [Incorporated by reference to Exhibit 2.3 to Nymox Pharmaceutical Corporation's Registration Statement on Form F-1 (File No. 333-31310)] 5.0 Opinion of Jack Gemmell, General Counsel of Nymox 10.0 Common Stock Private Purchase Agreement dated as of January 27, 2003, by and between the Company and Lorros-Greyse Investments, Ltd. 23.1 Consent of KPMG LLP 23.2 Consent of Jack Gemmell, General Counsel to Nymox (included in opinion filed herewith as Exhibit 5.0) 24.0 Powers of Attorney (contained as part of the signature page) EX-5.0 3 irm208b.txt OPINION OF COUNSEL March 12, 2003 Roy Wolvin Chief Financial Officer Nymox Pharmaceutical Corporation 9900 Cavendish Blvd. Suite 306 St.-Laurent, Quebec H4M 2V2 Re: Registration Statement on Form F-3 Under the Securities Act of 1933 Ladies and Gentlemen: I am General Counsel for Nymox Pharmaceutical Corporation, a Canadian corporation ("Nymox"), and in such capacity have acted as counsel in connection with the preparation and filing of a Registration Statement with the Securities and Exchange Commission on Form F-3 (the "Registration Statement") under the Securities Act of 1933, as amended (the "Act"), registering the resale of shares of Nymox common shares (the "Shares") which may be issued to Jaspas Investments Ltd. pursuant to a Warrant held by Jaspas Investments Ltd. to purchase 200,000 Shares. I have also acted in such capacity for Nymox in connection with the preparation of the Warrants issued by Nymox to Jaspas Investments Ltd. and the Share Purchase Agreement between Jaspas Investments Ltd. and Nymox pursuant to which the Warrants were issued together with the exhibits and schedules attached as a part thereof (collectively, the "Transaction Documents"). For the purpose of the opinions expressed herein, I have examined original executed, certified or facsimile copies of the following documents: 1. the Warrant issued by Nymox to Jaspas Investments Ltd. to purchase 200,000 Shares and the Share Purchase Agreement between Jaspas Investments Ltd. and Nymox pursuant to which the Warrant was issued together with the exhibits and schedules attached as a part thereof ; 2. the certificate and articles of incorporation, the certificate and articles of amendment, the by-laws and all amendments thereto and resolutions of the directors and shareholders as contained in the minute books of the Company; and 3. the Registration Statement. I have also reviewed the corporate records for Nymox available online at the Corporation Database Online of the Corporations Directorate of Industry Canada to confirm the active status of Nymox as a corporation incorporated under the Canada Business Corporations Act. I have relied upon these documents as well as my own knowledge of the business and operations of Nymox as General Counsel. In my examination of the foregoing documents, where I do not otherwise have personal knowledge, I have assumed: (a) the genuineness of all signatures on (whether originals or copies of documents), the authenticity of and completeness of, all documents submitted to me as originals and the conformity to original documents of all documents submitted to me as notarial, true, certified, conformed, photostatic, telecopied or electronic copies or similarly reproduced copies of such original documents; and (b) the completeness, truth and accuracy of all facts set forth in official public records, certificates and documents supplied by public officials or otherwise conveyed to me by public officials. As General Counsel and a director of Nymox, I can certify that : 1. The minute books and corporate records of the Corporation relating to the proceedings of the shareholders and directors of the Corporation are the original minute books and corporate records of the Corporation and contain all minutes of meetings, resolutions, by-laws and proceedings of the shareholders and directors of the Corporation to the date hereof and there have been no meetings, resolutions, by-laws or proceedings authorized or passed by the shareholders or directors of the Corporation to the date hereof not reflected in such minute books and corporate records. Such minute books and corporate records are true, complete and correct in all respects and there are no changes, additions or alterations necessary to be made thereto to make such books and corporate records true, complete and correct. 2. The Corporation is not insolvent and has not been dissolved and no acts or proceedings have been taken by or against the Corporation or are pending in connection with, and the Corporation has not received notice in respect of and is not in the course of or contemplating, any liquidation, winding-up, dissolution, bankruptcy, insolvency or reorganization. 3. The Corporation has not taken any steps to terminate its existence, amalgamate, to continue in any other jurisdiction or to change its corporate existence in any way. 4. The Corporation has not received any notice of any proceedings to cancel its certificate of incorporation or otherwise to terminate its existence. The Corporation has not received any notice or other communication from any person or governmental authority indicating that there exists any situation which, unless remedied, could result in the termination of its existence. I am qualified to practice law only in the Province of Ontario and my opinion below is expressed only with respect to the laws of Canada applicable therein. Based and relying upon the foregoing and subject to the limitations and qualifications set forth below, and assuming that: (i) the Registration Statement becomes and remains effective during the period when the Shares are distributed, (ii) no stop order suspending the effectiveness of the Registration Statement or any post-effective amendment thereof shall have been issued by the United States Securities and Exchange Commission or any State securities commission and no proceedings therefor shall have been initiated or threatened, (iii) no order or decision having the effect of preventing, ceasing or suspending the issuance or distribution of the Shares shall have been issued by the Quebec Securities Commission or similar regulatory authority and no proceeding for that purpose shall have been instituted or threatened, and (v) all applicable securities laws are complied with, I am of the opinion that: 1. Nymox is a corporation incorporated and validly existing under the Canada Business Corporations Act and has all necessary corporate power and authority to enter into the Warrants and to issue the Shares pursuant to those Warrants; 2. The execution and delivery of and performance by Nymox of the Warrants and the consummation of the transactions contemplated thereby, including the issuance of the Shares have been authorized by all necessary corporate action on the part of Nymox, and no further consent or authorization of Nymox or its Board of Directors or shareholders is required. 3. The Shares to be issued pursuant to the Warrants, when the amounts payable under the Warrants are paid and such Shares are issued as provided therein, will be legally issued by Nymox and fully paid and non-assessable common shares in the share capital of Nymox. This opinion is solely for the benefit of Nymox and not for the benefit of any other person. It is rendered solely in connection with the transactions to which it relates. It may not be quoted, in whole or in part, or otherwise referred to or used for any purpose without our prior written consent. I consent to the filing of this opinion as an exhibit to the Registration Statement and to the reference to my name under the caption "Certain Legal Matters" in the prospectus included as part of the Registration Statement. Yours truly, /s/ Jack Gemmell Jack Gemmell, General Counsel, Nymox EX-10.0 4 irm208a.txt COMMON STOCK PRIVATE PURCHASE AGREEMENT COMMON STOCK PRIVATE PURCHASE AGREEMENT This COMMON STOCK PRIVATE PURCHASE AGREEMENT (this "Agreement') is dated as of January 27, 2003 by and between Nymox Pharmaceutical Corporation, a Canadian corporation (the "Company"), and Lorros-Greyse Investments, Ltd. (the "Purchaser"). The parties hereto agree as follows: ARTICLE I DEFINITIONS Section 1.1 Certain Definitions (a) "Average Price" shall be the average of the Closing Prices of the Company's Common Stock for each Trading Day in the Draw Down Period. (b) "Closing Price" shall mean the price for the last reported trade as recorded by the Principal Market for the Trading Day. (c) "Current SEC Documents" shall mean the Company's Annual Report, as amended, for the year ended December 31, 2001, including the accompanying financial statements, and the Company's latest Quarterly Report, as filed with the U.S. Securities and Exchange Commission (the "SEC") and as available on the SEC's Electronic Data Gathering, Analysis, and Retrieval system ("EDGAR"). (d) "Draw Down" shall have the meaning assigned to such term in Section 6.1(a) hereof. (e) "Draw Down Closing Date" shall have the meaning assigned to such term in Section 6.1(b) hereof. (f) "Draw Down Pricing Period" shall have the meaning assigned to such term in Section 6.1(a) hereof. (g) "Material Adverse Effect" shall mean any adverse effect on the business, operations, properties or financial condition of the Company that materially impairs the ability of the Company and its subsidiaries and affiliates, taken as a whole, to perform any of its material obligations under this Agreement or to carry on its obligations, and shall include the loss for any reason to the Company of the services of Dr. Paul Averback. (h) "Principal Market" shall mean initially the Nasdaq SmallCap Market, and shall include the Nasdaq National Market, the American Stock Exchange or the New York Stock Exchange if the Company is listed and trades on such market or exchange. (i) "SEC Documents" shall mean all reports, schedules, forms, statements and other documents or material that are available on the SEC's EDGAR system and that were filed by the Company with the SEC pursuant to the reporting requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), including material filed pursuant to Section 13(a) or 15(d) of the Exchange Act and filings incorporated by reference. (j) "Shares" shall mean, collectively, the shares of Common Stock of the Company being subscribed for hereunder, or, in the appropriate context, the shares of Common Stock of the Company issued with respect to a Draw Down. 1 (k) "Trading Day" shall mean any day on which the Principal Market is open for business. ARTICLE II PURCHASE AND SALE OF COMMON STOCK Section 2.1 Purchase and Sale of Stock. Subject to the terms and conditions of this Agreement, the Company shall issue and sell to the Purchaser and the Purchaser shall purchase from the Company up to Five Million Dollars ($5,000,000) of the Company's Common Stock, no par value per share (the "Common Stock"), based on Draw Downs requested under this Agreement. Section 2.2 The Shares. The Company has authorized and has reserved and covenants to continue to reserve, free of preemptive rights and other similar contractual rights of stockholders, a sufficient number of its authorized but unissued shares of its Common Stock to cover the Shares to be issued in connection with all Draw Downs requested under this Agreement. At no time will the Company request a Draw Down which would result in the issuance of a number of shares of Common Stock pursuant to this Agreement which exceeds 4.9% of the number of shares of Common Stock issued and outstanding on the Closing Date without obtaining stockholder approval of such excess issuance. Section 2.3 Purchase Price and Closing. The Company agrees to issue and sell to the Purchaser and the Purchaser agrees to purchase that number of the Shares to be issued in connection with each Draw Down. Each party shall deliver all documents, instruments and writings required to be delivered by such party pursuant to this Agreement. ARTICLE III REPRESENTATIONS AND WARRANTIES Section 3.1 Representation and Warranties of the Company. The Company hereby makes the following representations and warranties to the Purchaser: (a) Organization, Good Standing and Power. The Company is a corporation duly incorporated, validly existing and in good standing under the federal laws of Canada and has the requisite corporate power to own, lease and operate its properties and assets and to conduct its business as it is now being conducted. The Company does not have any subsidiaries except as set forth in the Current SEC Documents. The Company and each such subsidiary is duly qualified as a foreign corporation to do business and is in good standing in every jurisdiction in which the nature of the business conducted or property owned by it makes such qualification necessary except for any jurisdiction in which the failure to be so qualified will not have a Material Adverse Effect on the Company's financial condition. (b) Authorization, Enforcement. The Company has the requisite corporate power and authority to enter into and perform this Agreement and to issue and sell the Shares in accordance with the terms hereof. The execution, delivery and performance of this Agreement by the Company and the consummation by it of the transactions contemplated hereby and thereby have been duly and validly authorized by all necessary corporate action, and no further consent or authorization of the Company or its Board of Directors or stockholders is required. This Agreement has been duly executed and delivered, and constitutes a valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, liquidation, conservatorship, receivership or similar laws relating to, or affecting generally the enforcement of, creditor's rights and remedies or by other equitable principles of general application. (c) Capitalization. The Company currently has issued and outstanding 23,020,954 shares of its Common Stock, all of which have been duly and validly authorized and are fully-paid and non-assessable. 2 Except as set forth in this Agreement and as set forth in the Current SEC Documents, no shares of Common Stock are entitled to preemptive rights or registration rights and there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of the Company. Furthermore, except as set forth in the SEC Documents, there are no contracts, commitments, understandings, or arrangements by which the Company is or may become bound to issue additional shares of the capital stock of the Company or options, securities or rights convertible into shares of capital stock of the Company. The Company is not a party to, and it has no knowledge of, any agreement restricting the voting or transfer of any shares of the capital stock of the Company. Except as set forth in the Current SEC Documents, the offer and sale of all capital stock, convertible securities, rights, warrants, or options of the Company issued prior to the Closing complied with all applicable United States Federal and state and Canadian and provincial securities laws, and no stockholder has a right of rescission or damages with respect thereto which would have a Material Adverse Effect on the Company's financial condition or operating results. The Company has made available to the Purchaser on request true and correct copies of the Company's Articles of Incorporation as in effect on the date hereof (the "Articles"), and the Company's Bylaws as in effect on the date hereof (the "Bylaws"). The Principal Market for the Common Stock in the United States is the Nasdaq SmallCap Market, and the Company has not received any notice from such market questioning or threatening the continued inclusion of the Common Stock on such market. (d) Issuance of Shares. The Shares to be issued under this Agreement have been duly authorized by all necessary corporate action and, when paid for or issued in accordance with the terms hereof, the Shares shall be validly issued and outstanding, fully paid and non-assessable, and the Purchaser shall be entitled to all rights accorded to a holder of Common Stock. (e) No Conflicts. The execution, delivery and performance of this Agreement by the Company and the consummation by the Company of the transactions contemplated herein do not and will not (i) violate any provision of the Company's Articles or Bylaws, (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, mortgage, deed of trust, indenture, note, bond, license, lease agreement, instrument or obligation to which the Company is a party, (iii) create or impose a lien, charge or encumbrance on any property of the Company under any agreement or any commitment to which the Company is a party or by which the Company is bound or by which any of its respective properties or assets are bound, or (iv) result in a violation of any United States Federal, state, local or Canadian, provincial, or other foreign statute, rule, regulation, order, judgment or decree (including any United States Federal and state or Canadian or provincial securities laws and regulations) applicable to the Company or any of its subsidiaries or by which any property or asset of the Company or any of its subsidiaries are bound or affected, except, in all cases, for such conflicts, defaults, termination, amendments, accelerations, cancellations and violations as would not, individually or in the aggregate, have a Material Adverse Effect. The business of the Company and its subsidiaries is not being conducted in violation of any laws, ordinances or regulations of any governmental entity, except for possible violations which singularly or in the aggregate do not and will not have a Material Adverse Effect. The Company is not required under any United States Federal, state or local or Canadian or provincial law, rule or regulation to obtain any consent, authorization or order of, or make any filing or registration with, any court or governmental agency in order for it to execute, deliver or perform any of its obligations under this Agreement, or issue and sell the Shares in accordance with the terms hereof (other than any prior notification required to the Nasdaq Stock Market of the listing of additional shares and approval of the Quebec Securities Commission for a distribution of shares outside of Quebec and any filings subsequent to the Agreement Closing which may be required to be made by the Company with the SEC, the Quebec Securities Commission, the Nasdaq Stock Market or state or provincial securities administrators and any registration statement, if any, which may be filed pursuant hereto); provided that, for purpose of the representation made in this sentence, the Company is assuming and relying upon the accuracy of the relevant representations and agreements of the Purchaser herein. 3 (f) SEC Documents, Financial Statements. The Common Stock of the Company is registered pursuant to Section 12(g) of the Exchange Act, and, except as disclosed in the SEC Documents, the Company has timely filed all reports, schedules, forms, statements and other documents required to be filed by it with the SEC pursuant to the reporting requirements of the Exchange Act, including material filed pursuant to Section 13(a) or 15(d) of the Exchange Act. The Company has electronically filed true and complete copies of SEC Documents with the SEC's Electronic Data Gathering, Analysis, and Retrieval system ("EDGAR") since August 8, 1996 and the Purchaser acknowledges having access to the EDGAR system and the SEC Documents. The Company has not provided to the Purchaser any information which, according to applicable law, rule or regulation, should have been disclosed publicly by the Company but which has not been so disclosed, other than with respect to the transactions contemplated by this Agreement. As of their filing dates, the Current SEC Documents complied in all material respects with the requirements of the Exchange Act and the rules and regulations of the SEC promulgated thereunder applicable to such documents, and, as of their filing dates, the Current SEC Documents did not contain any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The financial statements of the Company included in the SEC Documents comply as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC or other applicable rules and regulations with respect thereto. Such financial statements have been prepared in accordance with Canadian generally accepted accounting principles ("GAAP") applied on a consistent basis during the periods involved (except (i) as may be otherwise indicated in such financial statements or the notes thereto or (ii) in the case of unaudited interim statements, to the extent they may not include footnotes or may be condensed or summary statements), and fairly present in all material respects the financial position of the Company and its subsidiaries as of the dates thereof and the results of operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments). (g) Subsidiaries. The Current SEC Documents hereto set forth each subsidiary of the Company, showing the jurisdiction of its incorporation or organization and showing the Company's ownership of the outstanding stock or other interests of such subsidiary. All of the outstanding shares of capital stock of each subsidiary have been duly authorized and validly issued, and are fully paid and non-assessable. Neither the Company nor any subsidiary is a party to, nor has any knowledge of, any agreement restricting the voting or transfer of any shares of the capital stock of any subsidiary. (h) No Material Adverse Effect. Since September 30, 2002, the date through which the most recent quarterly of the Company has been prepared and filed with the SEC, neither the Company nor its subsidiaries has experienced or suffered any Material Adverse Effect or incurred any liabilities, obligations, debts, claims or losses which, individually or in the aggregate, has had a Material Adverse Effect on the Company or its subsidiaries. (i) No Undisclosed Events or Circumstances. No event or circumstance has occurred or exists with respect to the Company or its subsidiaries or their respective businesses, properties, prospects, operations or financial condition, which, under applicable law, rule or regulation, requires public disclosure or announcement by the Company but which has not been so publicly announced or disclosed. (j) Title to Assets. Each of the Company and the subsidiaries has good and marketable title to all of its real and personal property reflected in the SEC Documents, free of any mortgages, pledges, charges, liens, security interests or other encumbrances, except for those indicated in the Current SEC Documents or such that do not cause a Material Adverse Effect on the Company's financial condition or operating results. All said leases of the Company and each of its subsidiaries are valid and subsisting and in full force and effect. (k) Actions Pending. There is no action, suit, claim, investigation or proceeding pending or, to the knowledge of the Company, threatened against the Company or any subsidiary which questions the validity of this Agreement or the transactions contemplated hereby or any action taken or to be taken pursuant 4 hereto or thereto. Except as set forth in the Current SEC Documents or such that do not cause a Material Adverse Effect, there are no outstanding orders, judgments, injunctions, awards or decrees of any court, arbitrator or governmental or regulatory body against the Company or any subsidiary nor any actions, suits, claims, investigations or proceedings pending or, to the knowledge of the Company, threatened, against or involving the Company, any subsidiary or any of their respective properties or assets. (l) Compliance with Law. The business of the Company and its subsidiaries has been and is presently being conducted in accordance with all applicable United States Federal, state and local and Canadian and provincial governmental laws, rules, regulations and ordinances, except as set forth in the Current SEC Documents or such that do not cause a Material Adverse Effect. The Company and each of its subsidiaries have all franchises, permits, licenses, consents and other governmental or regulatory authorizations and approvals necessary for the conduct of their respective businesses as now being conducted by them unless the failure to possess such franchises, permits, licenses, consents and other governmental or regulatory authorizations and approvals, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect. (m) Taxes. Except as set forth in the Current SEC Documents, the Company and each of the subsidiaries has accurately prepared and filed all United States Federal and state and Canadian and provincial and other tax returns required by law to be filed by it, has paid or made provisions for the payment of all taxes shown to be due and all additional assessments, and adequate provision have been and are reflected in the financial statements of the Company and the subsidiaries for all current taxes and other charges to which the Company or any subsidiary is subject and which are not currently due and payable. The Company has no knowledge of any additional assessments, adjustments or contingent tax liability (whether federal, state or provincial) pending or threatened against the Company or any subsidiary for any period, nor of any basis for any such assessment, adjustment or contingency. (n) Operation of Business. The Company and each of the subsidiaries owns or possesses all patents, trademarks, service marks, trade names, copyrights, licenses and authorizations as set forth in the Current SEC Documents, and all rights with respect to the foregoing, which are necessary for the conduct of its business as now conducted without any conflict with the rights of others. (o) Regulatory Compliance. Except as disclosed in the Current SEC Documents or such that do not cause a Material Adverse Effect, the Company and each of its subsidiaries have obtained all material approvals, authorization, certificates, consents, licenses, orders and permits or other similar authorizations of all governmental authorities, or from any other person, that are required under any Food and Drug or Environmental Laws. "Environmental Laws" shall mean all applicable laws and regulations in the United States or Canada relating to the protection of the environment including, without limitation, all requirements pertaining to reporting, licensing, permitting, controlling, investigating or remediating emissions, discharges, releases or threatened releases of hazardous substances, chemical substances, pollutants, contaminants or toxic substances, materials or wastes, whether solid, liquid or gaseous in nature, into the air, surface water, groundwater or land, or relating to the manufacture, processing, distribution, use, treatment, storage, disposal transport or handling or hazardous substances, chemical substances, pollutants, contaminants or toxic substances, material or wastes, whether solid, liquid or gaseous in nature. "Food and Drug Laws" shall mean all applicable laws and regulations in the United States and Canada relating to the development, testing, manufacturing and distribution of pharmaceutical products. Except as set forth in the Current SEC Documents or such that do not cause a Material Adverse Effect, the Company has all necessary governmental approvals required under all Food and Drug and Environmental Laws and used in its business or in the business of any of its subsidiaries. (p) Books and Records. The records and documents of the Company and its subsidiaries accurately reflect in all material respects the information relating to the business of the Company and the subsidiaries, the location and collection of their assets, and the nature of all transactions giving rise to the obligations or accounts receivable of the Company or any subsidiary. 5 (q) Securities Laws Compliance. The Company has complied and will comply with all applicable United States Federal and state and Canadian and provincial securities laws in connection with the offer, issuance and sale of the Shares hereunder. Neither the Company nor anyone acting on its behalf, directly or indirectly, has or will sell, offer to sell or solicit offers to buy the Shares or similar securities to, or solicit offers with respect thereto from, or enter into any preliminary conversations or negotiations relating thereto with, any person (other than the Purchaser), so as to bring the issuance and sale of the Shares under the registration provisions of the Securities Act and applicable state securities laws. Neither the Company nor any of its affiliates, nor any person acting on its or their behalf, has engaged in any form of general solicitation or general advertising (within the meaning of Regulation D under the Securities Act) or directed selling efforts (within the meaning of Regulation S under the Securities Act) in connection with the offer or sale of the Shares. The Company is a "foreign issuer" within the meaning of Regulation S and Rule 405 under the Securities Act. (r) Governmental Approvals. Except as set forth in the Current SEC Documents, and except for the filing of any notice or the obtaining of any necessary approvals or exemptions prior or subsequent to the Closing that may be required under applicable United States Federal or state and Canadian or provincial securities laws (which if required, shall be filed on a timely basis), no authorization, consent, approval, license, exemption of, filing or registration with any court or governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, is or will be necessary for, or in connection with, the execution or delivery of the Shares, or for the performance by the Company of its obligations under this Agreement. (s) Employees. Neither the Company nor any subsidiary has any collective bargaining arrangements or agreements covering any of its employees, except as set forth in the Current SEC Documents. Except as set forth in the Current SEC Documents or such that do not cause a Material Adverse Effect, neither the Company nor any subsidiary is in breach of any employment contract, agreement regarding proprietary information, noncompetition agreement, nonsolicitation agreement, confidentiality agreement, or any other similar contract or restrictive covenant, relating to the right of any officer, employee or consultant to be employed or engaged by the Company or such subsidiary. Since the date of the latest Current SEC Document, no officer, consultant or key employee of the Company or any subsidiary whose termination, either individually or in the aggregate, could have a Material Adverse Effect, has terminated or, to the knowledge of the Company, has any present intention of terminating his or her employment or engagement with the Company or any subsidiary. (t) Use of Proceeds. The proceeds from the sale of the Shares will be used by the Company and its subsidiaries for general corporate purposes. (u) Acknowledgment Regarding Purchaser's Purchase of Shares. Company acknowledges and agrees that Purchaser is acting solely in the capacity of arm's length purchaser with respect to this Agreement and the transactions contemplated hereunder and that the Company's decision to enter into this Agreement has been based solely on the independent evaluation by the Company and its own representatives and counsel. Section 3.2 Representations and Warranties of the Purchaser. The Purchaser hereby makes the following representations, acknowledgements and warranties to the Company: (a) Organization and Standing of the Purchaser. The Purchaser is a company duly incorporated, validly existing and in good standing under the laws of the Republic of Panama and maintains its principal place of business in Panama. The Purchaser does not maintain a place of business in the United States or Canada, is not a resident of the United States or Canada and is not beneficially owned by any U.S. person within the meaning of Regulation S promulgated under the Securities Act. (b) Authorization and Power. The Purchaser has the requisite power and authority to enter into and perform this Agreement and to purchase the Shares being sold to it hereunder. The execution, 6 delivery and performance of this Agreement by Purchaser and the consummation by it of the transactions contemplated hereby have been duly authorized by all necessary corporate action. (c) No Conflicts. The execution, delivery and performance of this Agreement and the consummation by the Purchaser of the transactions contemplated hereby or relating hereto do not and will not (i) result in a violation of such Purchaser's charter documents or bylaws or (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of any agreement, indenture or instrument to which the Purchaser is a party, or result in a violation of any law, rule, or regulation, or any order, judgment or decree of any court or governmental agency applicable to the Purchaser or its properties (except for such conflicts, defaults and violations as would not, individually or in the aggregate, have a Material Adverse Effect on Purchaser). (d) Financial Risks. The Purchaser acknowledges that it is able to bear the financial risks associated with an investment in the Shares and that it has been given full access to such records of the Company and the subsidiaries and to the officers of the Company and the subsidiaries as it has deemed necessary or appropriate to conduct its due diligence investigation. The Purchaser is capable of evaluating the risks and merits of an investment in the Shares by virtue of its experience as an investor and its knowledge, experience, and sophistication in financial and business matters and the Purchaser is capable of bearing the entire loss of its investment in the Shares. (e) Accredited Investor. The Purchaser by itself or together with its adviser(s), is an "accredited investor", as such term is defined in Regulation D promulgated by the SEC under the Securities Act, is experienced in investments and business matters, has made investments of a speculative nature and, with its representatives, has such knowledge and experience in financial, tax and other business matters as to enable the Purchaser to utilize the information made available by the Company to evaluate the merits and risks of and to make an informed investment decision with respect to the proposed purchase, which represents a speculative investment. (f) Reliance upon Regulation S The Purchaser acknowledges that it is purchasing the Shares pursuant to an exemption from registration under the United States securities laws in reliance upon Regulation S promulgated under the Securities Act of 1933, as amended (the "Securities Act"). Accordingly, the Purchaser will not offer or sell any of the Shares to or for the benefit or account of a person resident in the United States or entity existing or incorporated under the laws of the United States or otherwise defined as a "U.S. person" under Regulation S for a period of at least forty (40) days from the date on which the Shares are purchased, unless such Shares are registered under the Securities Act or exempt from registration; (g) Access to Publicly Available Documents The Purchaser acknowledges that it or its advisors has access to all publicly-available documents or reports of the Company, including the SEC Documents and the Company's press releases, and that it or its advisors has reviewed and understands such documents or reports. The Purchaser acknowledges that the Company has not provided to the Purchaser any information which, according to applicable law, rule or regulation, should have been disclosed publicly by the Company but which has not been so disclosed, other than with respect to the transactions contemplated by this Agreement. (h) Purchase for Investment The Purchaser is purchasing the Shares solely for investment, for its own account, and not with a present intent to resell or otherwise to distribute any of the Shares. The Purchaser further represents that the Purchaser has no present or contemplated agreement, undertaking, arrangement, obligation, indebtedness or commitment providing for or which is likely to compel a disposition in any manner of any of the Shares, that the Purchaser is not aware of any circumstances presently in existence which are likely to promote in the future any disposition by the Purchaser of the Shares and that the Purchaser does not presently contemplate any sale of any of the Shares upon the occurrence or nonoccurrence of any predetermined or undetermined event or circumstance. 7 (i) Not A U.S. Person. The Purchaser is not a "U.S. person" or "a person in the United States" within the meaning of Regulation S promulgated under the Securities Act. (j) No Prior Short Selling. The Purchaser represents and warrants to the Company that at no time prior to the date of this Agreement has any of the Purchaser, its agents, representatives or affiliates engaged in or effected, in any manner whatsoever, directly or indirectly, any (i) "short sale" (as such term is defined in Rule 3b-3 of the Exchange Act) of the Common Stock or (ii) hedging transaction, which establishes a net short position with respect to the Common Stock. (k) General. The Purchaser understands that the Company is relying upon the truth and accuracy of the representations, warranties, agreements, acknowledgments and understandings of the Purchaser set forth herein in order to determine the suitability of the Purchaser to acquire the Shares. The Purchaser represents that any information which the Purchaser is furnishing to the Company in this Agreement, including, without limitation, the information provided on the signature page hereof, is correct and complete, and if such information or responses should cease to be correct at any time following the date hereof, the Purchaser will immediately furnish fully revised or corrected information to the Company. (l) Survival. The foregoing representations, warranties and agreements of the Purchaser shall survive this Agreement. ARTICLE IV COVENANTS Section 4.1 The Company's Covenants. The Company covenants with the Purchaser as follows: (a) Securities Compliance. The Company shall notify The Nasdaq Stock Market, Inc., in accordance with their rules and regulations, of the transactions contemplated by this Agreement, and shall take all other necessary action and proceedings as may be required and permitted by applicable law, rule and regulation, for the legal and valid issuance of the Shares to the Purchaser or subsequent holders. (b) Registration and Listing. The Company will cause its Common Stock to continue to be registered under Sections 12(b) or 12(g) of the Exchange Act, will comply in all respects with its reporting and filing obligations under the Exchange Act, and will not take any action or file any document (whether or not permitted by the Securities Act or the rules promulgated thereunder) to terminate or suspend its reporting and filing obligations under the Exchange Act or Securities Act, except as permitted herein. The Company will take all action necessary to continue the listing or trading of its Common Stock on the Nasdaq SmallCap Market or another Principal Market and will comply in all respects with the Company's reporting, filing and other obligations under the bylaws or rules of the NASD and The Nasdaq Stock Market. (c) Compliance with Laws. The Company shall comply, and cause each subsidiary to comply, with all applicable laws, rules, regulations and orders, noncompliance with which could have a Material Adverse Effect. (d) Keeping of Records and Books of Account. The Company shall keep and cause each subsidiary to keep adequate records and books of account, in which complete entries will be made in accordance with Canadian GAAP consistently applied, reflecting all financial transactions of the Company and its subsidiaries, and in which, for each fiscal year, all proper reserves for depreciation, depletion, obsolescence, amortization, taxes, bad debts and other purposes in connection with its business shall be made. (e) Amendments. The Company shall not amend or waive any provision the Articles of Incorporation, Bylaws of the Company in any way that would adversely affect the voting rights of the holders of the Shares. 8 (f) Other Agreements. The Company shall not enter into any agreement the terms of which such agreement would restrict or impair the right to perform of the Company or any subsidiary under this Agreement or the Articles of Incorporation of the Company. (g) Notice of Certain Events Affecting the Purchase or Sale. The Company will immediately notify the Purchaser upon the occurrence of any of the following events in respect of the issuance, purchase, sale, trading or distribution of the Shares pursuant to this Agreement: (i) receipt of any notification by the SEC, any state or provincial securities commission or any other regulatory authority with respect to the suspension of the qualification or exemption from qualification of any of the Shares for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; or (ii) issuance by the SEC, any state or provincial securities commission or any other regulatory authority of any stop order or of any order preventing or suspending any issuance, sale, purchase, trading or distribution of the Shares under this Agreement, or of the suspension of the qualification of the Shares for offering or sale in any jurisdiction, or the initiation or threatening of any proceeding for any such purpose. (h) Consolidation; Merger. The Company shall not, at any time after the date hereof, effect any merger or consolidation of the Company with or into, or a transfer of all or substantially all of the assets of the Company to, another entity (a "Consolidation Event") unless the resulting successor or acquiring entity (if not the Company) assumes by written instrument or by operation of law the obligation to deliver to the Purchaser such shares of stock and/or securities as the Purchaser is entitled to receive pursuant to this Agreement. (i) Compliance with Regulation S. The sale of the Shares shall be made in accordance with the provisions and requirements of Regulation S and any applicable federal, state or provincial securities law. The Company shall make any necessary SEC or other regulatory filings required to be made by the Company in connection with the sale of the Shares to the Purchaser as required by all applicable federal, state and provincial laws, and shall provide a copy thereof to the Purchaser upon request. Section 4.2 The Purchaser's Covenants (a) Limitation on Short Sales and Hedging Transactions. The Purchaser agrees that beginning on the date of this Agreement and ending on the date of termination or expiration of this Agreement, the Purchaser and its agents, representatives and affiliates shall not in any manner whatsoever enter into or effect, directly or indirectly, any (i) "short sale" (as such term is defined in Rule 3b-3 of the Exchange Act) of the Common Stock or (ii) hedging transaction, which establishes a net short position with respect to the Common Stock. (b) Compliance with Regulation S. The purchase of the Shares shall be made in accordance with the provisions and requirements of Regulation S and any applicable federal, state or provincial securities law. The Purchaser's trading and distribution activities with respect to shares of the Company's Common Stock shall be in compliance with all applicable federal, state and provincial securities laws, rules and regulations and rules and regulations of the Principal Market on which the Company's Common Stock is listed including, without limitation, Regulation S. (c) Notice of Certain Events Affecting The Purchase or Sale. The Purchaser will immediately notify the Purchaser upon the occurrence of any of the following events in respect of the issuance, purchase, sale, trading or distribution of the Shares pursuant to this Agreement: (i) receipt of any notification by the SEC, any state or provincial securities commission or any other regulatory authority with respect to the suspension of the qualification or exemption from qualification of any of the Shares for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; or (ii) issuance by the SEC, any state or provincial securities commission or any other regulatory authority of any stop order or of any order preventing or suspending any issuance, sale, purchase, trading or distribution of the Shares under this Agreement, or of 9 the suspension of the qualification of the Shares for offering or sale in any jurisdiction, or the initiation or threatening of any proceeding for any such purpose. (d) Material Changes in Purchaser's Status The Purchaser will immediately notify the Company of any changes in circumstance that may reasonably affect the availability of the exemption from registration under the Securities Act and the rules and regulations promulgated thereunder, including, without limitation, any changes that may affect the Purchaser's status as an "accredited investor", as such term is defined in Regulation D or as a person or entity that is not a U.S. person or a person in the United States for the purposes of Regulation S. ARTICLE V CONDITIONS TO CLOSING AND DRAW DOWNS Section 5.1 Conditions Precedent to the Obligation of the Company to Sell the Shares. The obligation hereunder of the Company to issue and sell the Shares to the Purchaser is subject to the satisfaction or waiver, at or before the Agreement Closing or at or before each Draw Down Closing, of each of the conditions set forth below. These conditions are for the Company's sole benefit and may be waived by the Company at any time in its sole discretion. (a) Accuracy of the Purchaser's Representations and Warranties. The representations and warranties of the Purchaser shall be true and correct in all material respects as of the date when made and as of the Closing and as of each Draw Down Closing Date as though made at that time, except for representations and warranties that speak as of a particular date. (b) Performance by the Purchaser. The Purchaser shall have performed, satisfied and complied in all material respects with all material covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Purchaser at or prior to the Closing and as of each Draw Down Closing Date. (c) No Injunction. No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by any court or governmental authority of competent jurisdiction which prohibits the consummation of any of the transactions contemplated by this Agreement. Section 5.2 Conditions Precedent to the Obligation of the Purchaser to Close. The obligation hereunder of the Purchaser to enter this Agreement is subject to the satisfaction or waiver, at or before the Agreement Closing and at or before each Draw Down Closing, of each of the conditions set forth below. These conditions are for the Purchaser's sole benefit and may be waived by the Purchaser at any time in its sole discretion. (a) Accuracy of the Company's Representations and Warranties. Each of the representations and warranties of the Company shall be true and correct in all material respects as of the date when made and as of the Closing as though made at that time (except for representations and warranties that speak as of a particular date). (b) Performance by the Company. The Company shall have performed, satisfied and complied in all respects with all covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Company at or prior to the Closing. (c) No Injunction. No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by any court or governmental authority of 10 competent jurisdiction which prohibits the consummation of any of the transactions contemplated by this Agreement. (d) No Proceedings or Litigation. No action, suit or proceeding before any arbitrator or any governmental authority shall have been commenced, and no investigation by any governmental authority shall have been threatened, against the Purchaser or the Company or any subsidiary, or any of the officers, directors or affiliates of the Company or any subsidiary seeking to restrain, prevent or change the transactions contemplated by this Agreement, or seeking damages in connection with such transactions. (e) No Suspension. Trading in the Company's Common Stock shall not have been suspended by the SEC or The Nasdaq Stock Market, Inc. (except for any suspension of trading of limited duration agreed to by the Company, which suspension shall be terminated prior to each Draw Down request), and, at any time prior to such request, trading in securities generally as reported by Nasdaq shall not have been suspended or limited, or minimum prices shall not have been established on securities whose trades are reported by Nasdaq. (f) Material Adverse Effect. No Material Adverse Effect and no Consolidation Event shall have occurred. ARTICLE VI DRAW DOWN TERMS Section 6.1 Draw Down Terms. Subject to the satisfaction of the conditions set forth in this Agreement, the parties agree as follows: (a) The Company, may, in its sole discretion, issue and exercise a draw down (a "Draw Down"), which Draw Down the Purchaser will be obligated to accept. The Company shall issue the Draw Down by giving the Purchaser a Draw Down Notice specifying the total Draw Down amount and the date of the Draw Down Notice. The Draw Down Period shall be the five (5) Trading Days specified in the Draw Down Notice immediately preceding the date of the Draw Down Notice. (b) Only one Draw Down shall be allowed for each Draw Down Pricing Period. The price per share paid by the Purchaser shall be based on the Average Daily Price on each separate Trading Day during the Draw Down Pricing Period. The number of shares of Common Stock purchased by the Purchaser with respect to each Draw Down shall be determined on the Draw Down Closing Date, which shall be the next Trading Day following the Draw Down date. (c) The Company shall have the right to issue and exercise a Draw Down of up to $500,000 of the Company's Common Stock per Draw Down, subject to the limitations set forth immediately below. The minimum Draw Down shall be $150,000 unless otherwise agreed by Purchaser. (d) The number of Shares of Common Stock to be issued in connection with each Draw Down shall be equal to the Draw Down amount divided by 97% of the Average Price of the Common Stock for the Draw Down Pricing Period. (e) The Company must provide the Purchaser via facsimile transmission the Draw Down Notice. At no time shall the Purchaser be required to purchase more than the Draw Down amount specified for a given Draw Down Pricing Period. (f) On or before three Trading Days after each Draw Down Closing Date, the Purchaser shall pay the specified Draw Down amount to the Company. Upon receipt of the Draw Down payment, the Company shall deliver the Shares to the Purchaser in accordance with any instructions from the Purchaser. 11 ARTICLE VII LEGENDS; TRANSFER AGENT INSTRUCTIONS Section 7.1 Legends. Unless otherwise provided below, each certificate representing Shares will bear the following legend or equivalent (the "Legend"): THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY OTHER APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT PROVIDED BY REGULATION S AND SUCH OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED, OR OTHERWISE DISPOSED OF, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO A TRANSACTION THAT IS EXEMPT FROM SUCH REGISTRATION. Section 7.2 Transfer Agent Instructions. Upon the settlement of a Draw Down, the Company shall issue to the transfer agent for its Common Stock (and to any substitute or replacement transfer agent for its Common Stock upon the Company's appointment of any such substitute or replacement transfer agent) instructions substantially in the form of Exhibit E hereto. Such instructions shall be irrevocable by the Company from and after the date hereof or from and after the issuance thereof to any such substitute or replacement transfer agent, as the case may be. Section 7.3 No Other Legend or Stock Transfer Restrictions. No legend other than the one specified in Section 7.1 shall be placed on the share certificates representing the Shares and no instructions or "stop transfer orders," "stock transfer restrictions," or other restrictions shall be given to the Company's transfer agent with respect thereto other than as expressly set forth in this Article VII, and the prohibition of transfers of the Shares except in compliance with the requirements of Regulations S, which the Investor hereby acknowledges. Section 7.4 Investor's Compliance. Nothing in this Article shall affect in any way the Investor's obligations to comply with all applicable securities laws upon resale of the Common Stock. ARTICLE VIII TERMINATION Section 8.1 Termination by Mutual Consent. The term of this Agreement shall be twenty-four (24) months from the date of execution of this Agreement. This Agreement may be terminated at any time by mutual written consent of the parties. Section 8.2 Other Termination. (a) The Purchaser may terminate this Agreement upon ten (10) Trading Days' notice if (i) an event resulting in a Material Adverse Effect has occurred, (ii) the Common Stock is de-listed from the Nasdaq SmallCap Market unless such de-listing is in connection with the listing of the Common Stock on the Nasdaq National Market, the New York or American Stock Exchanges, (iii) the Company files for protection from creditors under any applicable law, or (iv) the Company fails to deliver the Shares to the Purchaser in accordance with the instructions from the Purchaser. 12 (b) The Company may terminate this Agreement upon ten (10) Trading Days' notice if (i) the Company has completed Draw Downs of at least Three Million Dollars ($3,000,000) or (ii) the Purchaser shall fail to fund a properly noticed Draw Down within ten (10) Trading Days of the date payment for such Draw Down is due. (c) Effect of Termination. In the event of termination by the Company or the Purchaser, written notice thereof shall forthwith be given to the other party and the transactions contemplated by this Agreement shall be terminated without further action by either party. If this Agreement is terminated as provided in Section 8.1 or 8.2 herein, this Agreement shall become void and of no further force and effect, except for Articles IX and XI herein. Nothing in this Section 8.3 shall be deemed to release the Company or the Purchaser from any liability for any breach under this Agreement, or to impair the rights to the Company and the Purchaser to compel specific performance by the other party of its obligations under this Agreement ARTICLE IX INDEMNIFICATION Section 9.1 General Indemnity. The Company agrees to indemnify and hold harmless the Purchaser (and its directors, officers, affiliates, agents, successors and assigns) from and against any and all losses, liabilities, deficiencies, costs, damages and expenses (including, without limitation, reasonable attorney's fees, charges and disbursements) incurred by the Purchaser as a result of any inaccuracy in or breach of the representations, warranties or covenants made by the Company herein. The Purchaser agrees to indemnify and hold harmless the Company and its directors, officers, affiliates, agents, successors and assigns from and against any and all losses, liabilities, deficiencies, costs, damages and expenses (including, without limitation, reasonable attorneys fees, charges and disbursements) incurred by the Company as result of any inaccuracy in or breach of the representations, warranties or covenants made by the Purchaser herein. Section 9.2 Indemnification Procedure. Any party entitled to indemnification under this Article IX (an "indemnified party") will give written notice to the indemnifying party of any matters giving rise to a claim for indemnification; provided, that the failure of any party entitled to indemnification hereunder to give notice as provided herein shall not relieve the indemnifying party of its obligations under this Article IX except to the extent that the indemnifying party is actually prejudiced by such failure to give notice. In case any action, proceeding or claim is brought against an indemnified party in respect of which indemnification is sought hereunder, the indemnifying party shall be entitled to participate in and, unless in the reasonable judgment of counsel to the indemnified party a conflict of interest between it and the indemnifying party may exist with respect of such action, proceeding or claim, to assume the defense thereof with counsel reasonably satisfactory to the indemnified party. In the event that the indemnifying party advises an indemnified party that it will contest such a claim for indemnification hereunder, or fails, within thirty (30) days of receipt of any indemnification notice to notify, in writing, such person of its election to defend, settle or compromise, at its sole cost and expense, any action, proceeding or claim (or discontinues its defense at any time after it commences such defense), then the indemnified party may, at its option, defend, settle or otherwise compromise or pay such action or claim. In any event, unless and until the indemnifying party elects in writing to assume and does so assume the defense of any such claim, proceeding or action, the indemnified party's costs and expenses arising out of the defense, settlement or compromise of any such action, claim or proceeding shall be losses subject to indemnification hereunder. The indemnified party shall cooperate fully with the indemnifying party in connection with any settlement negotiations or defense of any such action or claim by the indemnifying party and shall furnish to the indemnifying party all information reasonably available to the indemnified party which relates to such action or claim. The indemnifying party shall keep the indemnified party fully apprised at all times as to the status of the defense or any settlement negotiations with respect thereto. If the indemnifying party elects to defend any such action or claim, then the indemnified party shall be entitled to participate in such defense with counsel of its choice at its sole cost and expense. The indemnifying party shall not be liable for any settlement of any action, claim or proceeding effected without its prior written consent. Notwithstanding anything in this Article IX to the contrary, the indemnifying party shall 13 not, without the indemnified party's prior written consent, settle or compromise any claim or consent to entry of any judgment in respect thereof which imposes any future obligation on the indemnified party or which does not include, as an unconditional term thereof, the giving by the claimant or the plaintiff to the indemnified party of a release from all liability in respect of such claim. The indemnification required by this Article IX shall be made by periodic payments of the amount thereof during the course of investigation or defense, as and when bills are received or expense, loss, damage or liability is incurred, so long as the indemnified party irrevocably agrees to refund such moneys if it is ultimately determined by a court of competent jurisdiction that such party was not entitled to indemnification. The indemnity agreements contained herein shall be in addition to (a) any cause of action or similar rights of the indemnified party against the indemnifying party or others, and (b) any liabilities the indemnifying party may be subject to. ARTICLE X ASSIGNMENT Section 10.1 Assignment. Neither this Agreement nor any rights of the Purchaser or the Company hereunder may be assigned by either party to any other person. ARTICLE XI NOTICES Section 11.1 Notices. All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be (i) hand delivered, (ii) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted by facsimile, addressed as set forth below or to such other address as such party shall have specified most recently by written notice. Any notice or other communication required or permitted to be given hereunder shall be deemed effective (a) upon hand delivery or delivery by facsimile, with accurate confirmation generated by the transmitting facsimile machine, at the address or number designated below (if delivered on a business day during normal business hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the first business day following the date of sending by reputable courier service, fully prepaid, addressed to such address, or (c) upon actual receipt of such mailing, if mailed. The addresses for such communications shall be: If to the Company: Nymox Pharmaceutical Corporation 9900 Cavendish Blvd. St. Laurent, Quebec, Canada H4M 2V2 Telephone Number: (800) 936-9669 Fax: (514) 332-9167 Attention: Dr. Paul Averback, President 14 with a copy to (shall not constitute notice): Stikeman Elliott 1155 Rene-Levesque Blvd. W. 40th Floor Montreal, Quebec Canada H3B 3V2 Attention: Gayle Noble Telephone: (514) 397-3205 Facsimile: (514) 397-3436 if to the Investor: As set forth on the signature pages hereto Either party hereto may from time to time change its address or facsimile number for notices under this Section 11.1 by giving written notice of such changed address or facsimile number to the other party hereto as provided in this Section 11.1. ARTICLE XII MISCELLANEOUS Section 12.1 Fees and Expenses. The Company shall pay all fees and expenses related to the transactions contemplated by this Agreement; provided, that the Company shall pay, at the Closing of the Agreement, all attorneys fees and expenses (exclusive of disbursements and out-of-pocket expenses) incurred by the Purchaser in connection with the preparation, negotiation, execution and delivery of this Agreement and the transactions contemplated hereunder. In addition, the Company shall pay all reasonable fees and expenses incurred by the Purchaser in connection with any amendments, modifications or waivers of this Agreement or incurred in connection with the enforcement of this Agreement, including, without limitation, all reasonable attorneys' fees and expenses. The Company shall pay all stamp or other similar taxes and duties levied in connection with issuance of the Shares pursuant hereto. Section 12.2 Specific Enforcement, Consent to Jurisdiction. (a) Injunctive Relief The Company and the Purchaser acknowledge and agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent or cure breaches of the provisions of this Agreement and to enforce specifically the terms and provisions hereof or thereof, this being in addition to any other remedy to which any of them may be entitled by law or equity. (b) Governing Law This Agreement shall be governed by and construed in accordance with the laws of Canada applicable to contracts made in Quebec by persons domiciled in Montreal and without regard to its principles of conflicts of laws. (c) Jurisdiction Each of the Company and the Purchaser (i) hereby irrevocably submits to the jurisdiction of the Quebec Superior Court and other courts of the Province of Quebec sitting in the District of Montreal for the purposes of any suit, action or proceeding arising out of or relating to this Agreement and (ii) hereby waives, and agrees not to assert in any such suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of such court, that the suit, action or proceeding is brought in an inconvenient forum or that the venue of the suit, action or proceeding is improper. Each of the Company and the Purchaser consents to process being served in any such suit, action or proceeding by mailing a copy thereof by certified mail, return receipt requested, to such party at the address in effect for notices to it under this 15 Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing in this Section shall affect or limit any right to serve process in any other manner permitted by law. Section 12.3 Entire Agreement; Amendment. This Agreement contains the entire understanding of the parties with respect to the matters covered hereby and, except as specifically set forth herein, neither the Company nor the Purchaser makes any representations, warranty, covenant or undertaking with respect to such matters. No provision of this Agreement may be waived or amended other than by a written instrument signed by the party against whom enforcement of any such amendment or waiver is sought. Section 12.4 Waivers. No waiver by either party of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any other provisions, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right accruing to it thereafter. Section 12.5 Headings. The article, section and subsection headings in this Agreement are for convenience only and shall not constitute a part of this Agreement for any other purpose and shall not be deemed to limit or affect any of the provisions hereof. Section 12.6 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and assigns. The parties hereto may not amend this Agreement or any rights or obligations hereunder without the prior written consent of the Company and each Purchaser to be affected by the amendment. After Closing, the assignment by a party to this Agreement of any rights hereunder shall not affect the obligations of such party under this Agreement. Section 12.7 No Third Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other person. Section 12.8 Counterparts. This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument and shall become effective when counterparts have been signed by each party and delivered to the other parties hereto, it being understood that all parties need not sign the same counterpart. Execution may be made by delivery by facsimile. Section 12.9 Publicity. Prior to the Closing, neither the Company nor the Purchaser shall issue any press release or otherwise make any public statement or announcement with respect to this Agreement or the transactions contemplated hereby or the existence of this Agreement. After the Closing, the Company may issue a press release or otherwise make a public statement or announcement with respect to this Agreement or the transactions contemplated hereby or the existence of this Agreement; provided, that prior to issuing any such press release, making any such public statement or announcement, the Company obtains the prior consent of the Purchaser, which consent shall not be unreasonably withheld or delayed. Section 12.10 Severability. The provisions of this Agreement are severable and, in the event that any court of competent jurisdiction shall determine that any one or more of the provisions or part of the provisions contained in this Agreement shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision or part of a provision of this Agreement and this Agreement shall be reformed and construed as if such invalid or illegal or unenforceable provision, or part of such provision, had never been contained herein, so that such provisions would be valid, legal and enforceable to the maximum extent possible. Section 12.11 Further Assurances. From and after the date of this Agreement, upon the request of the Purchaser or the Company, each of the Company and the Purchaser shall execute and deliver such 16 instruments, documents and other writings as may be reasonably necessary or desirable to confirm and carry out and to effectuate fully the intent and purposes of this Agreement. Section 12.12 Currencies. Unless otherwise specified, all references herein to dollars means United States dollars. 17 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorize officer as of the date first above written. NYMOX PHARMACEUTICAL CORPORATION By: /s/ Paul Averback ------------------------------------------------- Name: Dr. Paul Averback Title: President LORROS-GREYSE INVESTMENTS, LTD. By: /s/ ------------------------------------------------- Name: ------------------------------------------------- Title: ------------------------------------------------- 18 EXHIBIT E - --------- TREASURY DIRECTIVE ------------------ TO: COMPUTERSHARE INVESTOR SERVICES RE: ISSUANCE OF _____________________ COMMON SHARES OF NYMOX PHARMACEUTICAL CORPORATION ________________________________________________________________________________ By resolution adopted by the Board of Directors of Nymox Pharmaceutical Corporation (the "Company") dated ____________, you are hereby authorized to issue _______________ common shares (the "Shares") in consideration for $_____________ (US) received on ________________from Lorros-Greyse Investments, Ltd. (the "Investor") and in accordance with the Common Stock Private Purchase Agreement between the Investor and the Company. These shares are fully paid and non-assessable. As transfer agent and registrar for the Company, we request that you issue a certificate for the shares in question as follows: Lorros-Greyse Investments, Ltd. _______________________________ _______________________________ We have received a legal opinion that in order to permit the Company to comply with the requirements of the United States Securities Act of 1933, before the certificate for the Shares is issued to the Investor, the following legend should be typed on the certificate: THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED, (THE "SECURITIES ACT"), OR ANY OTHER APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT PROVIDED BY REGULATION S AND SUCH OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED, OR OTHERWISE DISPOSED OF, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO A TRANSACTION THAT IS EXEMPT FROM SUCH REGISTRATION. Please deliver the certificate to: Nymox Pharmaceutical Corporation 9900 Cavendish Blvd., Suite 306 St. Laurent, QC H4M 2V2 Attn: Roy Wolvin, C.F.O. Signed this _____ day of _______________, 2003 NYMOX PHARMACEUTICAL CORPORATION By: /s/ Roy Wolvin --------------------------------------- Roy Wolvin Secretary-Treasurer EX-23.1 5 irm208c.txt ACCOUNTANTS' CONSENT ACCOUNTANTS' CONSENT The Board of Directors Nymox Pharmaceutical Corporation: We consent to the incorporation by reference in the registration statement #333-31310 on Form F-3, dated March 12, 2003, of Nymox Pharmaceutical Corporation of our report, dated February 22, 2002 (except as to note 13 which is as of March 18, 2002), relating to the consolidated balance sheets of Nymox Pharmaceutical Corporation as at December 31, 2001 and 2000, and related consolidated statements of earnings, deficit and cash flows for the years ended December 31, 2001, 2000 and 1999, which report appears in the December 31, 2001 annual report on Form 20-F of Nymox Pharmaceutical Corporation and to the reference to our Firm under the heading "Experts" in the prospectus. /s/ KPMG LLP Chartered Accountants Montreal, Canada March 12, 2003 -----END PRIVACY-ENHANCED MESSAGE-----