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AUXILIO, INC. AMENDED AND RESTATED COMMON STOCK PURCHASE WARRANT ("WARRANT")

Warrant Agreement

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AUXILIO INC

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Title: AUXILIO, INC. AMENDED AND RESTATED COMMON STOCK PURCHASE WARRANT ("WARRANT")
Governing Law: California     Date: 3/27/2009
Industry: Business Services     Sector: Services

AUXILIO, INC. AMENDED AND RESTATED COMMON STOCK PURCHASE WARRANT (
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THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. THE SECURITIES REPRESENTED HEREBY MAY NOT BE OFFERED, SOLD, OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER APPLICABLE SECURITIES LAWS OR UNLESS OFFERED, SOLD, OR TRANSFERRED PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION OR QUALIFICATION REQUIREMENTS OF THOSE LAWS.

Original Date of Issuance: April 1, 2004                   Right to Purchase Up to 250,000 Shares of
Amended and Restated: March 19, 2009                 Common Stock

 

AUXILIO, INC.
AMENDED AND RESTATED COMMON STOCK PURCHASE WARRANT
(“WARRANT”)

     THIS CERTIFIES THAT, for value received, Etienne Weidemann or its registered assigns (the “ Holder ”) are entitled to purchase from Auxilio, Inc. (the “ Company ”), a Nevada corporation, at any time or from time to time during the period specified in Section 1 hereof, up to two hundred fifty thousand (250,000) fully paid and nonassessable shares of the Company’s common stock (the “ Common Stock ”), at an exercise price of $0.55 per share (the “ Exercise Price ”) upon the terms and conditions contained herein. The number of shares of Common Stock purchasable hereunder (the “ Warrant Shares ”) and the Exercise Price are subject to adjustment as provided in Section 4 hereof. The term “ Warrant ” means this Warrant. This Warrant is subject to the following terms, provisions, and conditions.

     1. Period of Exercise . This Warrant is exercisable at any time or from time to time on or after April 1, 2005 and before 5:00 P.M., Pacific Time on March 31, 2011 (the “ Exercise Period ”).

     2. Mechanics of Exercise . Subject to the provisions hereof, this Warrant may be exercised as follows.

     (i) Vesting. The Warrant will vest as follows: (a) 83,333 vested one year from the closing of the Mayo Merger Deal, on April 1, 2005. (b) 83,333 vesting contingent upon the company achieving a minimum of the 2004 EBITDA targets set forth in the Mayo Group, Inc. Merger (Exhibit H as amended and approved by the Board of Directors from time to time) of final Agreement and Plan of Merger between PeopleView, Inc., PeopleView Acquisition Corporation and Alan Mayo and Associates, Inc. (c) 83,334 vesting contingent upon the company achieving a minimum of the 2005 EBITDA targets set forth in the Mayo Group, Inc. Merger (Exhibit H as amended and approved by the Board of Directors from time to time) of final Agreement and Plan of Merger between PeopleView, Inc., PeopleView Acquisition

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Corporation and Alan Mayo and Associates, Inc. Warrants subject to contingencies numbers 2 and 3 above will be placed in Escrow and released to Holder within thirty days after audited numbers are achieved and released for the applicable periods. Should however, the actual 2004 and/or 2005 operating budget EBITDA achieved be less than 100% but 75% or more of the target set at closing, Executive will only be become entitled to an equally reduced ratio of these warrants. In the event that less than a 75% of the 2004 and/or 2005 operating target budgeted EBITDA is achieved, Executive will not be entitled to any percentage of the additional warrants.

     (b) Manner of Exercise . This Warrant may be exercised by the Holder, in whole or in part, by the surrender of this Warrant (or evidence of loss, theft, destruction, or mutilation thereof in accordance with Section 8(c) hereof), together with a completed exercise agreement in the Form of Exercise Agreement attached hereto as Exhibit 1 (the “ Exercise Agreement ”), to the Company at the Company’s principal executive offices (or such other office or agency of the Company as it may designate by notice to the Holder), together with (i) payment to the Company in cash, by certified or official bank check, or by wire transfer for the account of the Company of the Exercise Price for the Warrant Shares specified in the Exercise Agreement. The Warrant Shares so purchased will be deemed to be issued to the Holder or Holder’s designees, as the record owner of such shares, as of the date on which this Warrant has been surrendered, the completed Exercise Agreement has been delivered, and payment has been made for such shares as set forth above. In the event the Company’s Common Stock becomes Publicly Traded, then in lieu of the payment methods set forth above, when permitted by law and applicable regulations (including Nasdaq and NASD rules), the Holder may pay the Exercise Price through a “same day sale” commitment from the Holder (and if applicable a broker-dealer that is a member of the National Association of Securities Dealers (a “ NASD Dealer ”)), whereby the Holder irrevocably elects to exercise this Warrant and to sell a portion of the Shares so purchased to pay for the Exercise Price and the Holder (or, if applicable, the NASD Dealer) commits upon sale (or, in the case of the NASD Dealer, upon receipt) of such Warrant Shares to forward the Exercise Price directly to the Company.

     (c) Issuance of Certificates . Subject to Section 2(c), certificates for the Warrant Shares so purchased, representing the aggregate number of shares specified in the Exercise Agreement, will be delivered to the Holder within a reasonable time, not exceeding three (3) business days, after this Warrant has been so exercised (the “ Delivery Period ”). The certificates so delivered will be in such denominations as may be reasonably requested by the Holder and will be registered in the name of Holder or such other name as may be designated by such Holder. If this Warrant has been exercised only in part, then, unless this Warrant has expired, the Company will at its expense, at the time of delivery of such certificates, deliver to the Holder a new Warrant representing the number of shares with respect to which this Warrant has not then been exercised.

     (d) Exercise Disputes . In the case of any dispute with respect to an exercise, the Company will promptly issue such number of shares of Common Stock as are not disputed in accordance with this Section. If such dispute involves the calculation of the Exercise Price, the Company will submit the disputed calculations to a nationally recognized independent accounting firm (selected by the Company) via facsimile within three (3) business days of receipt of the Exercise Agreement. The accounting firm will audit the calculations and notify the Company and the converting Holder of the results no later than two (2) business days from the date it receives the disputed calculations. The accounting firm’s calculation will be deemed conclusive, absent manifest error. The Company will then issue the appropriate number of shares of Common Stock in accordance with this Section.

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     (e) Fractional Shares . No fractional shares of Common Stock are to be issued upon the exercise of this Warrant, but the Company will pay a cash adjustment in respect of any fractional share which would otherwise be issuable in an amount equal to the same fraction of the Exercise Price of a share of Common Stock (as determined for exercise of this Warrant into whole shares of Common Stock); provided that in the event that sufficient funds are not legally available for the payment of such cash adjustment any fractional shares of Common Stock will be rounded up to the next whole number.

     3. Certain Agreements of the Company . The Company hereby covenants and agrees as follows.

     (a) Shares to be Fully Paid . All Warrant Shares will, upon issuance in accordance with the terms of this Warrant, be validly issued, fully paid, and non-assessable and free from all taxes, liens, claims and encumbrances.

     (b) Reservation of Shares . During the Exercise Period, the Company will at all times have authorized, and reserved for the purpose of issuance upon exercise of this Warrant, a sufficient number of shares of Common Stock to provide for the exercise of this Warrant.

     (c) Certain Actions Prohibited . The Company will not, by amendment of its charter 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 by it hereunder, 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 actions as may reasonably be requested by the Holder of this Warrant in order to protect the exercise privilege of the Holder of this Warrant, consistent with the tenor and purpose of this Warrant. Without limiting the generality of the foregoing, the Company will take all such actions as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable shares of Common Stock upon the exercise of this Warrant.

     4. Antidilution Provisions . During the Exercise Period or until fully exercised, the Exercise Price and the number of Warrant Shares will be subject to adjustment from time to time as provided in this Section 4. In the event that any adjustment of the Exercise Price as required herein results in a fraction of a cent, such Exercise Price will be rounded up or down to the nearest cent.

     (a) Subdivision or Combination of Common Stock . If the Company, at any time after the initial issuance of this Warrant, subdivides (by any stock split, stock dividend, recapitalization, reorganization, reclassification or otherwise) its shares of Common Stock into a greater number of shares, then, after the date of record for effecting such subdivision, the Exercise Price in effect immediately prior to such subdivision will be proportionately reduced. If the Company at any time after the initial issuance of this Warrant combines (by reverse stock split, recapitalization, reorganization, reclassification or otherwise) its shares of Common Stock

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into a smaller number of shares, then, after the date of record for effecting such combination, the Exercise Price in effect immediately prior to such combination will be proportionately increased.

     (b) Adjustment in Number of Shares . Upon each adjustment of the Exercise Price pursuant to the provisions of this Section 4, the number of shares of Common Stock issuable upon exercise of this Warrant will be adjusted by multiplying a number equal to the Exercise Price in effect immediately prior to such adjustment by the number of shares of Common Stock issuable upon exercise of this Warrant immediately prior to such adjustment and dividing the product so obtained by the adjusted Exercise Price.

     (c) Merger . If the Company consolidates or merges with any other corporation or entity (other than a merger in which the Company is the survivi


 
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