FORM OF] COMMON STOCK PURCHASE WARRANT OF WEED, INC.
EXHIBIT 4.2
THIS WARRANT AND THE SECURITIES THAT MAY BE ISSUED UPON ITS
EXERCISE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD,
TRANSFERRED, OR PLEDGED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT UNDER SUCH ACT AND STATUTES UNLESS PRIOR TO ANY SALE,
TRANSFER, OR PLEDGE, THE ISSUER RECEIVES AN OPINION OF COUNSEL, IN
FORM AND SUBSTANCE REASONABLY SATISFACTORY TO IT, THAT REGISTRATION
IS NOT REQUIRED UNDER SUCH ACT AND THE STATUTES AND RULES
PROMULGATED THEREUNDER.
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Dated:
____________, 2020
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Right to Purchase
_________________
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Shares of Common
Stock,
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Warrant
No. WEED- ___________
[FORM
OF]
COMMON STOCK PURCHASE WARRANT
OF
This
certifies that, for value received,
_________________________________ (the “Holder”), is
entitled to subscribe for and purchase at the Exercise Price
(defined below) from WEED, Inc., a Nevada corporation (the
“Company”), shares of the Company’s Common Stock
as set forth below and subject to adjustment provided
therein.
This
Warrant is being issued pursuant to the Form 1-A Regulation A
Offering Circular dated ____________, 2020 and its exhibits as
filed with and qualified by the Securities and Exchange Commission
(the “SEC”) on ________________, 2020 (collectively,
the “Offering Circular”). Unless indicated otherwise,
the number of shares of common stock that Holder may purchase by
exercising this Warrant is ____________________
shares.
1. DEFINITIONS. As
used herein, the following terms shall have the following
respective meanings:
(a) “Exercise
Period” shall mean the period commencing with the date
beginning one (1) year from the date hereof and ending three (3)
years after the date hereof.
(b) “Exercise
Price” shall mean
[$1.50][$3.00][$4.50] per share.
(c) “Exercise
Shares” shall mean the shares of the Company’s common
tock issuable upon exercise of this Warrant.
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2. EXERCISE
OF WARRANT. The
rights represented by this Warrant may be exercised in whole or in
part at any time during the Exercise Period, by delivery of the
following to the Company at its address as set forth in Section 10,
below:
(a) An
executed Notice of Exercise in the form attached
hereto;
(b) Payment
of the Exercise Price in cash or by check; and
(c) This
Warrant.
Upon
the exercise of the rights represented by this Warrant, a
certificate or certificates for the Exercise Shares so purchased,
registered in the name of the Holder or persons affiliated with the
Holder, if the Holder so designates, shall be issued and delivered
to the Holder within a reasonable time after the rights represented
by this Warrant shall have been so exercised.
The
person in whose name any certificate or certificates for Exercise
Shares are to be issued upon exercise of this Warrant shall be
deemed to have become the holder of record of such shares on the
date on which this Warrant was surrendered and payment of the
Exercise Price was made, irrespective of the date of delivery of
such certificate or certificates, except that, if the date of such
surrender and payment is a date when the stock transfer books of
the Company are closed, such person shall be deemed to have become
the holder of such shares at the close of business on the next
succeeding date on which the stock transfer books are
open.
3. ADJUSTMENT
IN NUMBER OF SHARES.
In case
at any time or from time to time after the issue date the holders
of the common stock of the Company (or any shares of stock or other
securities at the time receivable upon the exercise of this
Warrant) shall have received, or, on or after the record date fixed
for the determination of eligible stockholders, shall have become
entitled to receive, without payment therefore, other or additional
stock or other securities or property (including cash) by way of
stock split, stock dividend, spin-off, reclassification,
combination of shares or similar corporate rearrangement, then and
in each such case the Holder of this Warrant, upon the exercise
hereof as provided in Section 3, shall be entitled to receive the
amount of stock and other securities and property which such Holder
would hold on the date of such exercise if on the issue date he had
been the holder of record of the number of shares of common stock
of the Company called for on the face of this Warrant and had
thereafter, during the period from the issue date, to and including
the date of such exercise, retained such shares and/or all other or
additional stock and other securities and property receivable by
him as aforesaid during such period, giving effect to all
adjustments called for during such period. In the event of any such
adjustment, the Exercise Price shall be adjusted to equal (A) the
Exercise Price in effect multiplied by the number of shares of
common stock into which this Warrant is exercisable immediately
prior to the adjustment, divided by (B) the number of shares of
common stock into which this Warrant is exercisable immediately
after such adjustment. Nothing in this Section or this Warrant will
entitle the Holder to receive more than the shares listed above, as
adjusted by this Section. There is no provision for the Holder to
receive any more shares of the Company’s common stock under
this Warrant as a penalty or otherwise.
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4. COVENANTS
OF THE COMPANY.
(a) Covenants
as to Exercise Shares. The Company covenants and agrees that
all Exercise Shares that may be issued upon the exercise of the
rights represented by this Warrant will, upon issuance, be validly
issued and outstanding, fully paid and nonassessable, and free from
all taxes, liens and charges with respect to the issuance thereof.
The Company further covenants and agrees that the Company will at
all times during the Exercise Period have authorized and reserved,
free from preemptive rights, a sufficient number of shares of its
common stock to provide for the exercise of the rights represented
by this Warrant. If at any time during the Exercise Period the
number of authorized but unissued shares of the Company’s
common stock shall not be sufficient to permit exercise of this
Warrant, the Company will take such corporate action as may, in the
opinion of its counsel, be necessary to increase its authorized but
unissued shares of common stock to such number of shares as shall
be sufficient for such purposes.
(b) No
Impairment. Except and to the extent as waived or consented
to by the Holder, the Company will not, by amendment of its
Articles of Incorporation or through any reorganization, transfer
of assets, consolidation, merger, dissolution, issue or sale of
securities or any other voluntary action, avoid or seek to avoid
the observance or performance of any of the terms to be observed or
performed hereunder by the Company, but will at all times in good
faith assist in the carrying out of all the provisions of this
Warrant and in the taking of all such action as may be necessary or
appropriate in order to protect the exercise rights of the Holder
against impairment.
(c) Notices
of Record Date. In the event of any taking by the Company of
a record of the holders of any class of securities for the purpose
of determining the holders thereof who are entitled to receive any
dividend (other than a cash dividend which is the same as cash
dividends paid in previous quarters) or other distribution, the
Company shall provide to the Holder, at least ten (10) days prior
to the date specified herein, a notice specifying the date on which
any such record is to be taken for the purpose of such dividend or
distribution.
5. REPRESENTATIONS
OF HOLDER.
(a) Acquisition
of Warrant for Personal Account. The Holder represents and
warrants that it is acquiring the Warrant and the Exercise Shares
solely for its account for investment and not with a view to or for
sale or distribution of said Warrant or Exercise Shares or any part
thereof. The Holder also represents that the entire legal and
beneficial interests of the Warrant and Exercise Shares the Holder
is acquiring is being acquired for its account only.
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(b) Securities
Are Not Registered; Exercise Shares to be
Restricted.
(1) The
Holder understands that the Warrant and the Exercise Shares have
not been registered under the Securities Act of 1933, as amended
(the “Act”) on the basis that no distribution or public
offering of the stock of the Company is to be effected. The Holder
realizes that the basis for the exemption may not be present if,
notwithstanding its representations, the Holder has a present
intention of acquiring the securities for a fixed or determinable
period in the future, selling (in connection with a distribution or
otherwise), granting any participation in, or otherwise
distributing the securities. The Holder has no such present
intention.
(2) The
Holder recognizes that the Warrant and the Exercise Shares must be
held indefinitely unless they are subsequently registered under the
Act or an exemption from such registration is available. The Holder
recognizes that the Company has no obligation to register the
Warrant or the Exercise Shares of the Company, or to comply with
any exemption from such registration.
(3) The
Holder is aware that neither the Warrant nor the Exercise Shares
may be sold pursuant to Rule 144 adopted under the Act unless
certain conditions are met, including, among other things, the
existence of a public market for the shares, the availability of
certain current public information about the Company, the resale
following the required holding period under Rule 144 and the number
of shares being sold during any three month period not exceeding
specified limitations. Holder is aware that the conditions for
resale set forth in Rule 144 have not been satisfied and that the
Company presently has no plans to satisfy these conditions in the
foreseeable future.
(c) Disposition
of Warrant and Exercise Shares.
(1) The
Holder further agrees not to make any disposition of all or any
part of the Warrant or Exercise Shares in any event unless and
until:
a) The
Company shall have received a letter secured by the Holder from the
Securities and Exchange Commission stating that no action will be
recommended to the Commission with respect to the proposed
disposition;
b) There
is then in effect a registration statement under the Act covering
such proposed disposition and such disposition is made in
accordance with said registration statement; or
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c) The
Holder shall have notified the Company of the proposed disposition
and shall have furnished the Company with a detailed statement of
the circumstances surrounding the proposed disposition, and if
reasonably requested by the Company, the Holder shall have
furnished the Company with an opinion of counsel, reasonably
satisfactory to the Company, for the Holder to the effect that such
disposition will not require registration of such Warrant or
Exercise Shares under the Act or any applicable state securities
laws.
(d) The
Holder understands and agrees that all certificates evidencing the
shares to be issued to the Holder will bear the following
legend:
THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “ACT”). THEY MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER THE ACT
OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED.
6. FRACTIONAL
SHARES. No
fractional shares shall be issued upon the exercise of this Warrant
as a consequence of any adjustment pursuant hereto. All Exercise
Shares (including fractions) issuable upon exercise of this Warrant
may be aggregated for purposes of determining whether the exercise
would result in the issuance of any fractional share. If, after
aggregation, the exercise would result in the issuance of a
fractional share, the Company shall, in lieu of issuance of any
fractional share, pay the Holder otherwise entitled to such
fraction a sum in cash equal to the product resulting from
multiplying the then current fair market value of an Exercise Share
by such fraction.
7. NO
STOCKHOLDER RIGHTS. This Warrant in and of itself
shall not entitle the Holder to any voting rights or other rights
as a stockholder of the Company.
8. TRANSFER
OF WARRANT. This
Warrant and all rights hereunder are not transferable by the Holder
unless the Holder obtains the express written consent of the
Company.
9. LOST,
STOLEN, MUTILATED OR DESTROYED WARRANT. If this Warrant is lost, stolen,
mutilated or destroyed, the Company may, on such terms as to
indemnity or otherwise as it may reasonably impose (which shall, in
the case of a mutilated Warrant, include the surrender thereof),
issue a new Warrant of like denomination and tenor as the Warrant
so lost, stolen, mutilated or destroyed. Any such new Warrant shall
constitute an original contractual obligation of the Company,
whether or not the allegedly lost, stolen, mutilated or destroyed
Warrant shall be at any time enforceable by anyone.
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10. WAIVER
AND AMENDMENT. Any term of this Warrant may be amended or
waived only with the written consent of the Holder.
11. NOTICES. All
notices required or permitted hereunder shall be in writing and
shall be deemed effectively given: (a) upon personal delivery to
the Party to be notified, (b) when sent by confirmed facsimile if
sent during normal business hours of the recipient, if not, then on
the next business day, or (c) one (1) day after deposit with a
nationally recognized overnight courier, specifying next day
delivery, with written verification of receipt. All communications
shall be sent as follows:
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If to the Company:
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▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, President
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Facsimile No.:
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with a copy to:
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Law Offices of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇
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▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
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Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
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If to Holder:
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Facsimile No.: __________
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or at such
other address as the Company or Holder may designate by ten (10)
days advance written notice to the other Party hereto.
12. GOVERNING
LAW; VENUE. The
terms of this Warrant shall be construed in accordance with the
laws of the State of Arizona, as applied to contracts entered into
by Arizona residents within the State of Arizona, and to be
performed entirely within the State of Arizona. The parties agree
that any action brought to enforce the terms of this Warrant will
be brought in the appropriate federal or state court having
jurisdiction over Pima County, Arizona.
13. ATTORNEYS’
FEES. Should either party commence any legal action or
proceeding in order to enforce or interpret this Warrant or any
term or provision hereof, then in addition to any damages or
remedies that may be awarded or granted to the prevailing party
therein, the prevailing party shall be entitled to have and recover
from the losing party such prevailing party’s reasonable
attorneys’ fees and costs incurred in connection
therewith.
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14. CURRENCY.
All currency is expressed in U.S. dollars.
IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed
by its duly authorized officer as of _________________,
201__.
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a Nevada corporation
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By: ▇▇▇▇▇
▇. ▇▇▇▇▇▇
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Its: President
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NOTICE OF EXERCISE
TO:
(1) The
undersigned hereby elects to purchase ________ shares of the common
stock of WEED, Inc., a Nevada corporation (the
“Company”), pursuant to the terms of the attached
Warrant and based on an exercise price of [$1.50][$3.00][$4.50],
and tenders herewith payment of the exercise price in full,
together with all applicable transfer taxes, if any.
(2) Please
issue a certificate or certificates representing said shares of the
Company’s common stock in the name of the undersigned or in
such other name as is specified below:
_____________________________
(Name)
_____________________________
_____________________________
(Address)
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(Date)
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(Signature)
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(Print name)
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