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EXHIBIT 10.2
THIS WARRANT HAS BEEN, AND THE WARRANT SHARES ISSUABLE UPON EXERCISE
HEREOF WILL BE, ISSUED AND SOLD IN RELIANCE UPON EXEMPTIONS FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933
ACT") AND OF THE GEORGIA SECURITIES ACT OF 1973 (THE "GEORGIA
SECURITIES ACT"). THE WARRANT SHARES ARE RESTRICTED SECURITIES. SUCH
RESTRICTED SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, OR
TRANSFERRED OTHER THAN (I) PURSUANT TO AN EFFECTIVE REGISTRATION OR AN
EXEMPTION THEREFROM UNDER THE 1933 ACT AND THE GEORGIA SECURITIES ACT,
AND (II) UPON RECEIPT BY THE ISSUER OF EVIDENCE SATISFACTORY TO IT OF
COMPLIANCE WITH THE 1933 ACT, THE GEORGIA SECURITIES ACT AND THE
APPLICABLE SECURITIES LAWS OF ANY OTHER JURISDICTION. THE ISSUER SHALL
BE ENTITLED TO REQUIRE AN OPINION OF COUNSEL REASONABLY SATISFACTORY
TO IT WITH RESPECT TO COMPLIANCE WITH THE ABOVE LAWS.
STUPID PC, INC.
STOCK PURCHASE WARRANT
COMMON STOCK
Warrant No. ______
Original Issue Date: May 14, 1999 50,000 shares
THIS CERTIFIES THAT, FOR VALUE RECEIVED, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, a resident
of the State of Georgia or assigns (the "Holder"), shall be entitled, subject
to the terms and conditions hereof, any time or from time to time on or after
the Original Issue Date until 5:00 p.m., Eastern Time, on the tenth (10th)
anniversary of the Original Issue Date set forth above, or if such date is not
a day on which the Company is open for business, then the next succeeding day
on which the Company is open for business (such date is the "Expiration Date"),
but not thereafter, to purchase up to FIFTY THOUSAND (50,000) shares of Common
Stock of STUPID PC, INC. a Georgia corporation (the "Company"), for the price
per share of THREE DOLLARS ($3.00) (the "Exercise Price"), such number of
shares being subject to adjustment upon the occurrence of the contingencies set
forth in this Warrant. The shares of Common Stock issuable from time to time
upon exercise hereof are sometimes referred to herein as the "Warrant Shares."
This Warrant is subject to the following additional terms and
conditions:
SECTION 1. TIME OF EXERCISE. This warrant is exercisable at any
time within ten years from the date of its issue
SECTION 2. MANNER OF EXERCISE.
(a) Subject to Section 1 above, this Warrant may, at the
option of the Holder, be exercised in whole or in part from time to
time by delivery to the Company at its office at ▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: President, or to any transfer agent
for the Common Stock, on or before 5:00 p.m., Eastern Time, on the
Expiration Date, (i) a written notice of such registered Holder's
election to exercise this Warrant (the "Exercise Notice"), which
notice may be in the form of the Notice of Exercise attached hereto,
properly executed and completed by the registered Holder or an
authorized officer thereof, (ii) a check payable to the order of the
Company, in an amount equal to the product of the Exercise Price
MULTIPLIED BY the number of Warrant Shares specified in the Exercise
Notice, AND (iii) this Warrant (the items specified in (i), (ii), and
(iii) are collectively the "Exercise Materials").
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(b) Upon timely receipt of the Exercise Materials, the
Company shall, as promptly as practicable, and in any event within
five (5) business days after its receipt of the Exercise Materials,
execute or cause to be executed and delivered to Holder a certificate
or certificates representing the number of Warrant Shares specified in
the Exercise Notice, together with cash in lieu of any fraction of a
share, and, (x) if the Warrant is exercised in full, a copy of this
Warrant marked "Exercised," or (y) if the Warrant is partially
exercised, a copy of this Warrant marked "Partially Exercised"
together with a new Warrant on the same terms for the unexercised
balance of the Warrant Shares. The stock certificate or certificates
shall be registered in the name of the registered Holder of this
Warrant or such other name or names as shall be designated in the
Exercise Notice. The date on which the Warrant shall be deemed to have
been exercised (the "Effective Date"), and the date the person in
whose name any certificate evidencing the Common Stock issued upon the
exercise hereof is issued shall be deemed to have become the holder of
record of such shares, shall be the date the Company receives the
Exercise Materials, irrespective of the date of delivery of a
certificate or certificates evidencing the Common Stock issued upon
the exercise hereof, except that, if the date on which the Exercise
Materials are received by the Company is a date on which the stock
transfer books of the Company are closed, the Effective Date shall be
the date the Company receives the Exercise Materials, and the date
such person shall be deemed to have become the holder of the Common
Stock issued upon the exercise hereof shall be the next succeeding
date on which the stock transfer books are open. All shares of Common
Stock issued upon the exercise of this Warrant will, upon issuance, be
fully paid and nonassessable and free from all taxes, liens, and
charges with respect thereto.
SECTION 3. ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF SHARES.
The Exercise Price and the number of Warrant Shares issuable upon exercise
hereof shall be subject to adjustment from time to time in accordance with the
following provisions:
(a) If the Company shall at any time subdivide the
outstanding shares of its Common Stock (including any stock split
which increases the number of shares outstanding), the Exercise Price
in effect immediately prior to such subdivision shall be
proportionately decreased, and in case the Company shall at any time
combine the outstanding shares of its Common Stock (including any
stock split which reduces the number of shares outstanding), the
Exercise Price in effect immediately prior to such combination shall
be proportionately increased, effective from and after the record date
of such subdivision or combination, as the case may be.
(b) If the Company shall issue any shares of Common Stock
as a dividend, from and after the date which is the record date for
the determination of shareholders entitled to such dividend, the
number of Warrant Shares issuable upon exercise of this Warrant shall
be increased to a number which is the product of (i) the Warrant
Shares issuable upon exercise hereof immediately prior to said record
date MULTIPLIED BY (ii) a fraction, the numerator of which is the sum
of the total number of shares of Common Stock outstanding immediately
prior to said record date (assuming the exercise of all outstanding
options, warrants, and rights to purchase Common Stock and the
conversion into or exchange for Common Stock of all outstanding
convertible or exchangeable securities) PLUS the number of shares of
Common Stock issued as a dividend, and the denominator of which is the
total number of shares of Common Stock outstanding immediately prior
to said record date (assuming the exercise of all outstanding options,
warrants, and rights to purchase Common Stock and the conversion into
or exchange for Common Stock of all outstanding convertible or
exchangeable securities).
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SECTION 4. REORGANIZATION, RECLASSIFICATION, CONSOLIDATION OR
MERGER. If at any time while this Warrant is outstanding there shall be any
reorganization or reclassification of the Common Stock of the Company (other
than a subdivision or combination of shares provided for in Section 3(a)
above), or any consolidation, share exchange, or merger of the Company with
another corporation, the holder of this Warrant shall thereafter be entitled to
receive, during the term hereof and upon payment of the Exercise Price, the
number of shares of stock or other securities or property of the Company or of
the successor corporation resulting from such consolidation, share exchange, or
merger, as the case may be, to which a holder of the Common Stock of the
Company, deliverable upon the exercise of this Warrant, would have been
entitled upon such reorganization, reclassification, consolidation, share
exchange, or merger if this Warrant had been exercised immediately prior to
such reorganization, reclassification, consolidation, share exchange, or
merger; and in any such case, appropriate adjustment (as determined by
agreement of the registered holder and the Board of Directors of the Company)
shall be made in the application of the provisions herein set forth with
respect to the rights and interest thereafter of the holder of this Warrant to
the end that the provisions set forth herein (including the adjustment of the
Exercise Price and the number of shares issuable upon the exercise of this
Warrant) shall thereafter be applicable, as near as reasonably may be, in
relation to any shares or other property thereafter deliverable upon the
exercise hereof.
SECTION 5. NOTICE OF ADJUSTMENTS. Upon any adjustment of the
Default or Exercise Price and any increase or decrease in the number of shares
of Common Stock purchasable upon the exercise of this Warrant, then, and in
each such case, the Company, within 30 days after any such adjustment, shall
give written notice thereof to the registered holder of this Warrant at the
address of such holder as shown on the books of the Company, which notice shall
state the Default or Exercise Price as adjusted and the increased or decreased
number of shares issuable upon the exercise of this Warrant, setting forth in
reasonable detail the method of calculation of each.
SECTION 6. CHARGES, TAXES AND EXPENSES. The issuance of
certificates for shares of Common Stock upon any exercise of this Warrant shall
be made without charge to the Holder hereof for any tax or other expense in
respect to the issuance of such certificates, all of which shall be paid by the
Company. Certificates evidencing the Common Stock issued upon exercise hereof
shall be issued in the name of, or in such name or names as may be directed by,
the Holder of this Warrant; provided, however, that in the event that
certificates for shares of Common Stock are to be issued in a name other than
the name of the Holder of this Warrant, this Warrant when surrendered for
exercise shall be accompanied by an instrument of transfer in form satisfactory
to the Company, duly executed by the Holder hereof in person or by an attorney
duly authorized in writing, and the holder shall pay all stock transfer taxes,
if any, payable upon the transfer of this Warrant.
SECTION 7. CERTAIN OBLIGATIONS OF THE COMPANY.
(a) The Company agrees that it will not establish or
increase the par value of the shares of any Common Stock which are
issuable upon exercise of this Warrant above the then prevailing
Exercise Price hereunder and that, before taking any action which
would cause an adjustment reducing the Exercise Price hereunder below
the then par value, if any, of the shares of any Common Stock issuable
upon exercise hereof, the Company will take any corporate action which
may, in the opinion of its counsel, be necessary in order that the
Company may validly and legally issue fully paid and non assessable
shares of Common Stock at the Exercise Price as so adjusted.
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(b) Commencing with the initial public offering, the
Holder shall be entitled to two (2) piggy back registrations until all
shares of Common Stock issued or issuable upon the exercise of this
Warrant have been registered. The Company agrees to give the
registered Holder of this Warrant notice of its intent to file a
registration statement with the Securities and Exchange Commission
relating to any equity securities of the Company at least 45 days
prior to the date of filing with the Securities and Exchange
Commission of any such registration statement, and to include in such
registration statement all shares of Common Stock issuable upon
exercise hereof which Holder requests be included in such
registration. Holder will bear customary selling expenses such as
underwriter's discount and commissions and the Company will bear all
other costs associated with the registration and sale of the shares
included in such registration.
SECTION 8. MISCELLANEOUS.
(a) The Company covenants that it will at all times
reserve and keep available, solely for the purpose of issuance upon
the exercise hereof, a sufficient number of shares of Common Stock to
permit the exercise hereof in full.
(b) This Warrant is not cancelable by the Company. The
terms of this Warrant shall be binding upon and shall inure to the
benefit of any successors or assigns of the Company and of the Holder
hereof and of the Common Stock issued or issuable upon the exercise
hereof. The provisions of Section 7(b) shall survive the exercise of
this Warrant, until all shares of Common Stock issued upon the
exercise hereof have been registered or are tradable under Rule 144.
(c) No holder of this Warrant, as such, shall be entitled
to vote or receive dividends (except as provided in paragraph 3(a)
hereof) or be deemed to be a stockholder of the Company for any
purpose.
(d) This Warrant may be divided into separate Warrants
covering one Warrant Share or any whole multiple thereof, for the
total number of Warrant Shares then issuable upon exercise of this
Warrant at any time, or from time to time, upon the request of the
registered holder of this Warrant and the surrender of the same to the
Company for such purpose. Such subdivided Warrants shall be issued
promptly by the Company following any such request and shall be of the
same form and tenor as this Warrant, except for any requested change
in the name of the registered Holder stated herein.
(e) Except as otherwise provided herein, this Warrant and
all rights hereunder are transferable by the registered Holder hereof
in person or by duly authorized attorney on the books of the Company
upon surrender of this Warrant, properly endorsed, to the Company. The
Company may deem and treat the registered Holder of this Warrant at
any time as the absolute owner hereof for all purposes and shall not
be affected by any notice to the contrary.
(f) Notwithstanding any provision herein to the contrary,
the Holder hereof may not exercise, sell, transfer, or otherwise
assign this Warrant unless the Company is provided with an opinion of
counsel satisfactory in form and substance to the Company, to the
effect that such exercise, sale, transfer, or assignment does not
violate the Securities Act of 1933 or applicable state securities
laws.
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IN WITNESS WHEREOF, the Company has caused this Warrant to be signed
by its duly authorized officers and its corporate seal to be affixed hereto.
STUPID PC, INC.
By:/s/ ▇▇▇▇ ▇▇▇▇▇▇▇
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▇▇▇▇ ▇▇▇▇▇▇▇, President
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ASSIGNMENT
(To be Executed by the Registered Holder to effect a Transfer of the
foregoing Warrant)
FOR VALUE RECEIVED, the undersigned hereby sells, and assigns and
transfers unto _____________________________________________________________ the
foregoing Warrant and the rights represented thereto to purchase shares of
Common Stock of STUPID PC, INC. in accordance with terms and conditions
thereof, and does hereby irrevocably constitute and appoint ________________
Attorney to transfer the said Warrant on the books of the Company, with full
power of substitution.
Holder:
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Address:
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Dated:__________________, 19__
In the presence of:
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FORM OF NOTICE OF EXERCISE
[To be signed only upon exercise of Warrant]
To: STUPID PC, INC.
The undersigned registered Holder of the attached Warrant hereby
irrevocably elects to exercise the Warrant for, and to purchase thereunder,
___________ shares of Common Stock of STUPID PC, INC. issuable upon exercise of
said Warrant and hereby surrenders said Warrant and delivers to STUPID PC,
Inc., $_________ representing the Purchase Price for such shares. The
undersigned herewith requests that the certificates for such shares be issued
in the name of, and delivered to the undersigned, whose address is
________________________ and social security or tax identification number is
______________.
Signed:
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Dated:
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NOTICE
The signature above must correspond to the name as written upon the
face of the within Warrant in every particular, without alteration or
enlargement or any change whatsoever.
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