Exhibit 10.3
THIS WARRANT
AND THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE
SECURITIES LAWS OF ANY STATE. NEITHER THIS WARRANT OR
SUCH SECURITIES MAY BE SOLD, OFFERED FOR SALE, PLEDGED,
HYPOTHECATED, OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE
STATE SECURITIES LAWS, OR SOME EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF SUCH ACT AND LAWS, OR AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER
SUCH ACT OR LAWS, OR UNLESS SOLD PURSUANT TO RULE 144 UNDER
SUCH ACT.
ACCELERIZE NEW MEDIA,
INC.
COMMON STOCK WARRANT
This Warrant is issued effective as of January
1, 2007 (the “ Warrant Issue Date ”) to Daniel
Goldberg (“ Holder ”), by ACCELERIZE NEW MEDIA,
INC., a Delaware corporation (the “ Company ”)
in connection with the Asset Purchase Agreement dated as of
December __, 2006 by and among the Company, Holder and the other
parties thereto (the “ Asset Purchase Agreement
”).
1.
Purchase of Shares . Subject to the terms and
conditions hereinafter set forth, the Holder is entitled, upon
surrender of this Warrant at the principal office of the Company
(or at such other place as the Company shall notify the Holder in
writing), to purchase from the Company up to 250,000 shares of the
Company’s Common Stock, par value $0.001 per share (the
“ Common Stock ”), pursuant to the terms of
Section 2. The number of shares of Common Stock issuable
pursuant to this Section 1 (the “ Shares ”)
shall be subject to adjustment pursuant to Section 8
hereof.
2.
Term and Exerciseability of Warrant . This
Warrant may be exercised only to the extent vested from time to
time.
(a) Subject
to the provisions below, this Warrant will vest 100% on the
eighteen (18) month anniversary of the date hereof (the “
Warrant Vesting Date ”), but will only be exerciseable
if, and to the extent, the Special Vesting Provisions set forth on
Schedule 1 have been met
(b) This
Warrant shall fully vest and become exercisable immediately prior
to the effective date of a Change in Control (defined
below).
(c) For
purposes of this Agreement, the term “Change in
Control” shall mean (i) the sale of all or substantially all
of the assets of the Company, (ii) the sale of more than 50% of the
outstanding capital stock of the Company in a non-public sale,
(iii) the dissolution or liquidation of the Company, or (iv) any
merger, share exchange, consolidation or other reorganization or
business combination of the Company if immediately after such
transaction of either (A) persons who were directors of the Company
immediately prior to such transaction do not constitute at least a
majority of the directors of the surviving entity, or (B) persons
who hold a majority of the voting capital stock of the surviving
entity are not persons who held a majority of the voting capital
stock of the Company immediately prior to the transaction;
provided , however , that the term “Change in
Control” shall not include a public offering of capital stock
of the Company that is effected pursuant to a registration
statement filed with, and declared effective by, the Securities and
Exchange Commission under the Securities Act of 1933.
(d) If
the Holder dies before this Warrant has been exercised in full, the
executor, administrator or personal representative of the estate of
the Holder may exercise this Warrant as set forth in this
paragraph; provided that such exercise must be within twelve
(12) months of Holder’s death.
3.
Exercise Price . The exercise price per share for
which the Shares may be purchased pursuant to the terms of this
Warrant shall be $.15 per share, and shall be subject to adjustment
pursuant to Section 8 hereof (such price, as adjusted from time to
time, is herein referred to as the “ Exercise Price
”).
(a)
Exercise Period . This Warrant may be exercised
to the extent vested, in whole or in part, commencing on the
Warrant Vesting Date and ending at 5:00 p.m., United States Eastern
Time, on the fifth anniversary of the Warrant Issue Date (the
“ Expiration Date ”). For the
avoidance of doubt, if any part of this Warrant remains unvested or
unexercised after the Expiration Date, the Holder’s rights
with respect to such shares shall extinguish and this Warrant shall
no longer be of any force or effect.
4.
Method of Exercise . While this Warrant remains
outstanding and exercisable in accordance with Sections 2
and 3 above, the Holder may exercise, in whole or in part, the
purchase rights evidenced hereby. Such exercise shall be
effected by:
(a) the
surrender of the Warrant, together with a duly executed copy of the
form of Notice of Election attached hereto, to the President of the
Company at its principal offices; and
(b) the
payment to the Company of an amount equal to the aggregate Exercise
Price for the number of Shares being purchased. This
Warrant can also be exercised at Holder’s discretion, in
whole or in part, in a “cashless”
exercise. In a cashless exercise, the right to purchase
each share of Common Stock may be exchanged for that number of
shares of Common Stock determined by multiplying the number one (1)
by a fraction, the numerator of which will be the difference
between (y) the then current Fair Market Value and (z) the exercise
price, and the denominator of which will be the then current Fair
Market Value.
5.
Fair Market Value. Fair Market Value of a share of Common
Stock as of a particular date (the “Determination
Date”) shall mean:
|
|
|
If the
Company’s Common Stock is traded on an exchange or is quoted
on The Nasdaq Stock Market, Inc., then the last sale price reported
for the last business day immediately preceding the Determination
Date;
|
|
|
|
If the
Company’s Common Stock is not traded on an exchange or quoted
on The Nasdaq Stock Market, Inc., but is traded in the
over-the-counter market, then the average of the closing bid and
ask prices reported for the last business day immediately preceding
the Determination Date;
|
|
|
|
Except as
provided in clause (d) below, if the Company’s Common Stock
is not publicly traded, then as the Holder and the Company agree,
or in the absence of such an agreement, by arbitration in
accordance with the rules then standing of the American Arbitration
Association, before a single arbitrator to be chosen from a panel
of persons qualified by education and training to pass on the
matter to be decided; or
|
|
|
|
If the
Determination Date is the date of a liquidation, dissolution, or
winding up, or any event deemed to be a liquidation, dissolution,
or winding up pursuant to the Company’s charter, then all
amounts to be payable per shares to holders of the Common Stock
pursuant to the charter in the event of such liquidation,
dissolution, or winding up, plus all other amounts to be payable
per share in respect of the Common Stock in liquidation under the
charter, assuming that the purposes of this clause (d) that all of
the shares of Common Stock then issuable upon exercise of all of
the Warrants are outstanding at the Determination Date.
|
6.
Certificates for Shares . Upon the exercise of
the purchase rights evidenced by this Warrant, one or more
certificates for the number of Shares so purchased shall be issued
as soon as practicable thereafter (with appropriate restrictive
legends, if applicable), and in any event within three (3) business
days thereafter, the Company at its expense (including the payment
by it of any applicable issue taxes) will cause to be issued in the
name of and delivered to the Holder hereof, or as such Holder (upon
payment by such Holder of any applicable transfer taxes) may direct
in compliance with applicable securities laws, a certificate or
certificates for the number of duly and validly issued, fully paid
and nonassessable shares of Common Stock (or other securities) to
which such Holder shall be entitled on such exercise.
7.
Issuance of Shares . The Company covenants that
the Shares, when issued pursuant to the exercise of this
Warra
