INNERSPACE CORPORATION
COMMON STOCK PURCHASE WARRANT
DATED AS OF MAY 17, 2002
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THIS WARRANT AND THE SHARES OF COMMON STOCK COVERED HEREBY (COLLECTIVELY, THE
"SECURITIES") HAVE NOT BEEN REGISTERED UNDER THE GEORGIA SECURITIES ACT OF 1973,
AS AMENDED ("GEORGIA ACT"), IN RELIANCE UPON THE EXEMPTION PROVIDED BY SECTION
9(m) (NOW CODIFIED AS O.C.G.A. SECTION 10-5-9(13)) THEREOF, AND HAVE NOT BEEN
REGISTERED UNDER ANY OTHER STATE SECURITIES LAW OR THE SECURITIES ACT OF 1933,
AS AMENDED ("FEDERAL ACT"). THE SECURITIES WILL BE ACQUIRED FOR INVESTMENT AND
MAY NOT BE OFFERED FOR SALE, HYPOTHECATED, SOLD OR TRANSFERRED, NOR WILL ANY
ASSIGNEE OR TRANSFEREE THEREOF BE RECOGNIZED BY INNERSPACE CORPORATION (THE
"COMPANY") AS HAVING ANY INTEREST IN SUCH SECURITIES, IN THE ABSENCE OF (i) AN
EFFECTIVE REGISTRATION STATEMENT WITH RESPECT TO THE SECURITIES UNDER THE
GEORGIA ACT, OR AN OPINION OF COUNSEL, WHICH OPINION AND COUNSEL SHALL BE
SATISFACTORY TO THE COMPANY, THAT THE TRANSACTION BY WHICH SUCH SECURITIES WILL
BE OFFERED FOR SALE, HYPOTHECATED, SOLD OR TRANSFERRED IS EXEMPT UNDER THE
GEORGIA ACT OR IS OTHERWISE IN COMPLIANCE WITH THE GEORGIA ACT; AND (ii) AN
EFFECTIVE REGISTRATION STATEMENT WITH RESPECT TO THE SECURITIES UNDER THE
FEDERAL ACT, AND ANY OTHER APPLICABLE STATE SECURITIES LAWS, OR AN OPINION OF
COUNSEL, WHICH OPINION AND COUNSEL SHALL BE SATISFACTORY TO THE COMPANY, THAT
SUCH REGISTRATION IS NOT REQUIRED.
INNERSPACE CORPORATION
COMMON STOCK PURCHASE WARRANT
Warrant No 5 No. of Shares - 40,000
This certifies that, for value received, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, hereinafter
referred to as the registered holder or the "Optionee," or his successors and
assigns, is entitled, subject to the terms and conditions hereinafter set forth,
at or before 5:00 o'clock P.M., Eastern time, on May 17, 2003, but not
thereafter, to purchase 40,000 shares of $.001 par value Common Stock (the
"Common Stock") of INNERSPACE CORPORATION, a Delaware corporation (the
"Company"), such number of shares being subject to adjustment upon the
occurrence of the contingencies set forth in this Warrant. The purchase price
payable upon the exercise of this Warrant shall be $0.125 per share, said amount
being hereinafter referred to as the "Warrant Price" and being subject to
adjustments upon the occurrence of the contingencies set forth in this Warrant.
Upon delivery of this Warrant with the subscription form annexed hereto,
duly executed, together with payment of the Warrant Price for the shares of
Common Stock thereby purchased, at the principal office of the Company, ▇▇▇
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as the Company may designate by notice in writing to the registered holder
hereof, the registered holder of this Warrant shall be entitled to receive a
certificate or certificates for the shares of Common Stock so purchased. All
shares of Common Stock which may be issued upon the exercise of this Warrant
will, upon issuance, be fully-paid and non-assessable and free from all taxes,
liens and charges with respect thereto.
This Warrant is subject to the following terms and conditions:
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1. Optional Exercise of Warrant. This Warrant may be exercised in whole
at any time, or in any part from time to time, at or prior to 5:00
o'clock P.M., Eastern time, on May 17, 2003, but not thereafter, as to
all of the number of whole shares of Common Stock then subject hereto.
Payment of the Warrant Price shall be made in cash.
2. Adjustment of Warrant Price and Number of Shares Purchasable
Hereunder. In case the Company shall at any time subdivide the
outstanding shares of its Common Stock, the Warrant 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, the Warrant Price in effect
shall immediately prior to such combination be proportionately
increased, effective from and after the record date of such
subdivision or combination, as the case may be.
3. Notice of Adjustments. Upon any adjustment of the Warrant 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 thirty (30) days thereafter, 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 Warrant Price as adjusted and the increased or
decreased number of shares purchasable upon the exercise of this
Warrant, setting forth in reasonable detail the method of calculation
of each. The holder of the Warrant shall have 10 days in which to
review the proposed adjustment and to object to the proposed
adjustment by notifying the Company in writing of such objection,
setting forth in reasonable detail the reasons for such objection. If
the holder fails to object to the proposed adjustment during such
10-day period the proposed adjustment shall become final. If the
holder objects to the proposed adjustment then the Company and the
holder shall attempt to reconcile their differences and if unable to
do so such adjustment shall be determined by the Company's independent
accountants whose determination shall be final.
4. Notice of Exercise of Option. This Option may be exercised by the
Optionee by a written notice signed by the Optionee, and delivered or
mailed to the Company to the attention of the President. The notice
shall specify the number of shares of Stock which the Optionee elects
to purchase hereunder, and be accompanied by (i) a certified or
cashier's check payable to the Company in payment of the total
Exercise Price applicable to such shares as provided herein, (ii)
shares of Stock owned by Optionee and duly endorsed or accompanied by
stock transfer powers having a Fair Market Value equal to the total
Exercise Price applicable to such shares purchased hereunder, or (iii)
a certified or cashier's check accompanied by a certificate or
certificates representing the number of shares of Stock whose Fair
Market Value when added to the amount of the check equals the total
Exercise Price applicable to such shares purchased hereunder. Upon
receipt of an such notice and accompanying payment, the Company agrees
to issue to the Optionee stock certificates for the number of shares
specified in such notice registered in the name of the Optionee.
5. 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
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respect to the issuance of such certificates, all of which taxes and
expenses shall be paid by the Company, and such certificates 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.
6. Certain Obligations of the Company. The Company will not, by amendment
of its Certificate of Incorporation or through reorganization,
consolidation, merger, dissolution or sale of assets, or by any other
voluntary act or deed, avoid or seek to avoid the performance or
observance of any of the covenants, stipulations or conditions to be
performed or observed by the Company, but will at all times in good
faith assist, insofar as it is able, in the carrying out of all
provisions of this Warrant and in the taking of all other action which
may be necessary in order to protect the rights of the holder of this
Warrant against dilution. Without limiting the generality of the
foregoing, the Company agrees that it will not establish or increase
the par value of the shares of any Common Stock which are at the time
issuable upon exercise of this Warrant above the then prevailing
Warrant Price hereunder and that, before taking any action which would
cause an adjustment reducing the Warrant 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 such Common Stock at the Warrant Price as so adjusted.
7. Miscellaneous.
a. The Company covenants that it will at all times reserve and keep
available, solely for the purpose of issue upon the exercise
hereof, a sufficient number of shares of Common Stock to permit
the exercise hereof in full and a sufficient number of shares of
Common Stock to permit the conversion of all such shares of
Common Stock.
b. 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 or holders hereof and of the Common Stock issued or
issuable on the exercise hereof.
c. No holder of this Warrant, as such, shall be entitled under this
Warrant to vote or receive dividends (except as provided in
paragraph 2 hereof) or be deemed to be a shareholder of the
Company for any purpose.
d. This Warrant may be divided into separate Warrants covering one
share of the Common Stock or any whole multiple thereof, for the
total number of shares of Common Stock then subject to 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,
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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. By acceptance of this Warrant the registered holder represents
and warrants to the Company that such holder is acquiring this
Warrant and will acquire any shares of Common Stock issued upon
the exercise of this Warrant for the holder's own account with
the intent of holding such warrant or shares for investment and
without the intent of participating directly or indirectly in a
distribution of the same. Any certificates for Common Stock
issued upon the exercise of this Warrant shall bear a legend
similar to the legend appearing on the first page of this
Warrant.
g. The term "Fair Market Value" shall mean the average Closing Sales
Price of the Company's Common Stock for the five (5) trading days
immediately preceding the date of notice or exercise which
relates to said determination of Fair Market Value.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its
duly authorized officers and its corporation seal to be affixed hereto.
Dated: May 17, 2002
INNERSPACE CORPORATION
By:
Chief Executive Officer
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 INNERSPACE CORPORATION, in accordance with the terms and
conditions thereof, and does hereby irrevocably constitute and appoint
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_________________________ Attorney to transfer the said Warrant on the books of
the Company, with full power of substitution.
________________________________ By _____________________________
Signature
________________________________
________________________________
________________________________
Address
Dated:__________________________
In the presence of:
________________________________
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SUBSCRIPTION FORM
(To be Executed by the Registered Holder to Exercise the Rights to Purchase
Stock evidenced by the foregoing Warrant)
TO: INNERSPACE CORPORATION
The undersigned hereby exercises the right to purchase _______ shares of
Common Stock covered by the attached Warrant in accordance with the terms and
conditions thereof, and herewith makes payment of the Warrant Price of such
shares in full.
The undersigned represents and warrants to you that the undersigned is
acquiring such shares for the undersigned's own account with the intent of
holding such shares for investment and without the intent of participating
directly or indirectly in a distribution of such shares.
_________________________________
By: _____________________________
Signature
_________________________________
_________________________________
Address
Dated: _________________.
