EXHIBIT 10.9
THE SECURITIES REPRESENTED BY THIS WARRANT HAVE BEEN ACQUIRED FOR
INVESTMENT AND
HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED ("1933
ACT") OR ANY STATE SECURITIES LAWS.
SUCH SECURITIES MAY NOT BE SOLD
OR
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
EXEMPTION THEREFROM UNDER
THE 1933 ACT AND ANY APPLICABLE STATE SECURITIES LAWS.
CLASS B WARRANT TO PURCHASE SHARES
OF THE STOCK OF
SUNGAME
CORPORATION
(VOID AFTER EXPIRATION DATE - __________________)
Issue Date: ________, 2009
This
certifies that _______ or his successors or
assigns ("HOLDER")
shall be entitled to purchase from SUNGAME CORPORATION,
a Delaware corporation
("COMPANY"), having its principal place of business at
________________________,
up to a total of _______________________________ fully
paid and non-assessable
shares of the Company's common stock, ("COMMON
STOCK"), at a price per share
equal to the Exercise Price (as defined below).
The exercise price
(the "EXERCISE PRICE") of this Class B Warrant will
be equal to $2.50 per share, subject to adjustment upon
the occurrence of the
events described in Section 2 of this Class B Warrant.
This Class B
Warrant shall be exercisable into shares of Common
Stock
at any time, or from time-to-time, up to and including 5:00 p.m.
(New York time)
on __________________ ("EXPIRATION DATE"),
provided, however, if such date is
not a Business Day, then on the Business Day
immediately following such date).
This Class B Warrant is exercisable in whole or in part
upon the surrender to
the Company at its principal place of business (or at such other
location as the
Company may advise the Holder in
writing) of this Class B Warrant properly
endorsed with a form of subscription in substantially
the form attached hereto
duly filled in and signed and, if applicable, upon
payment in cash or by check
of the aggregate Exercise Price for the number of shares for
which this Class B
Warrant is being exercised as determined in
accordance with the provisions
hereof.
1. EXERCISE; ISSUANCE OF CERTIFICATES; PAYMENT FOR SHARES.
1.A GENERAL. This Class B
Warrant is exercisable in full, or in
part, at the option of the Holder of record
at any time or
from time, to time, up to the Expiration Date for all
of the
shares of
Common Stock (but not for a fraction of a
share)
which may be purchased hereunder. In the case of the
exercise
of less than all of the Class B Warrants represented
hereby,
the Company shall cancel this Class B Warrant Certificate upon
the surrender hereof and shall execute and deliver a new Class
B Warrant Certificate or Class B Warrant Certificates of
like
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tenor for the balance of such Class B Warrants.
The Company
agrees that the shares of Common Stock purchased
under this
Class B Warrant shall be and are deemed to be
issued to the
Holder hereof as the record owner of such
shares as of the
close of business on the date on which the
exercise notice
(attached hereto as Schedule A or B)
is delivered to the
Company via
facsimile; provided, however, that in such
case
this Class B Warrant shall be
surrendered to the Company
within three (3) business days. Certificates for the shares of
Common Stock so purchased, together with any other
securities
or property to which the Holder
is entitled upon such
exercise, shall be delivered to the Holder by the
Company at
the Company's expense within a
reasonable time after the
rights represented by this Class B
Warrant have been so
exercised, and in any event, within three
business days of
such exercise and delivery of the Exercise Price. The
Company
shall, no later than the close of
business on the first
business day following the date on which the Company
receives
the exercise notice by facsimile
transmission issue and
deliver to the Company's
Transfer Agent irrevocable
instructions to issue and deliver or cause to be delivered
to
such Holder the number of Warrant Shares exercised within
two
business days thereafter by either
express mail or hand
delivery. Each Common Stock certificate so delivered shall
be
in such denominations of 10,000 or
more shares of Common
Stock,
in increments of 10,000, as may be requested by
the
Holder hereof and shall be registered on the Company's
books
in the name designated by such Holder, provided that no Holder
of this Class B Warrant shall be permitted to
exercise any
warrants to the extent that such exercise
would cause any
Holder to be the beneficial owner of more than 4.999%
of the
then outstanding Company's Common Stock, at that
given time
(as determined in accordance with
Section 13(d) of the
Securities Exchange Act of 1934, as
amended, and the rules
thereunder This limitation shall not be deemed to prevent
any
Holder from acquiring more than an aggregate of 4.999% of
the
Common Stock, so long as such Holder does
not beneficially
own, or have the right to beneficially more than 4.999% of the
Company's Common Stock at any given time.
The limitations
contained herein shall cease to apply upon
sixty-one (61)
days' prior written notice from the Holder to the Company.
1.B EXERCISE FOR CASH
This Class B Warrant may be exercised, in whole at any time or
in part from time to time, commencing on the date
hereof and
prior to 5:00 P.M., New York time, on
__________________, by
the Holder by the facsimile delivery of the exercise
notice,
as attached hereto, on the date
of the exercise and by
surrender of this Class B Warrant within three
(3) business
days from the exercise day at the address set
forth hereof,
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together with proper payment of the aggregate Exercise
Price
payable hereunder for the Class B Warrant Shares
("AGGREGATE
WARRANT PRICE"), or the proportionate part
thereof if this
Class B Warrant is exercised in part. Payment for the Class
B
Warrant Shares shall be made by wire, or check payable to
the
order of the Company. If this Class B Warrant is exercised
in
part, this Class B Warrant must be exercised for a
number of
whole shares of the Common Stock, and the Holder is
entitled
to receive a new Class B Warrant covering the Class B
Warrant
Shares which have not been exercised and
setting forth the
proportionate part of the Aggregate Warrant Price
applicable
to such Class B Warrant Shares. Upon such
surrender of this
Class B Warrant the Company will (a) issue a
certificate or
certificates in the name of the Holder for the largest
number
of whole shares of the Common Stock to which the Holder
shall
be entitled and (b) deliver the
other securities and
properties receivable upon the
exercise of this Class B
Warrant, or
the proportionate part thereof if this Class
B
Warrant is exercised in part, pursuant to the
provisions of
this Class B Warrant.
1.C SHARES TO BE FULLY PAID;
RESERVATION OF SHARES. The Company
covenants and agrees that all shares of Common Stock which may
be issued upon the exercise of the rights represented by
this
Class B Warrant will, upon issuance,
be duly authorized,
validly issued, fully paid and nonassessable and free from all
preemptive rights of any shareholder and free of
all taxes,
liens and charges with respect to the
issue thereof. The
Company
further covenants and agrees that, during the
period
within which the rights represented by this Class
B Warrant
may be exercised, the Company
will at all times have
authorized and reserved, for the purpose of issue or
transfer
upon exercise of the subscription rights
evidenced by this
Class B Warrant, a sufficient number of shares of
authorized
but unissued Common Stock, when and as required to provide for
the exercise of the rights
represented by this Class B
Warrant. The Company will take all
such action as may be
necessary to assure that such shares of Common
Stock may be
issued as provided herein without violation of any
applicable
law or regulation, or of any requirements
of any domestic
securities exchange upon which the
Common Stock or other
securities may be listed; provided, however, that the
Company
shall not be required to effect a registration under
federal
or state securities laws with respect to such exercise
other
than as required by the Registration Rights
Agreement. The
Company will not take any action which
would result in any
adjustment of the Exercise Price if the total number of shares
of
Common Stock issuable after such action upon
exercise of
all outstanding warrants, together with all shares of
Common
Stock then outstanding and all shares of
Common Stock then
issuable upon exercise of all options and upon the
conversion
of all convertible securities then outstanding, would
exceed
the total number of shares of Common Stock then authorized
by
the Company's Articles of Incorporation ("COMPANY CHARTER").
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1.D BUY-IN. In addition to any other
rights available to a Holder,
if the Company fails to deliver to the Holder a
certificate
representing Warrant Shares by the fifth Trading Day after the
date on which delivery of such certificate is required by this
Warrant, and if after such fifth
Trading Day the Holder
purchases (in an
open market transaction or otherwise) shares
of Common Stock to deliver in satisfaction of a
sale by the
Holder on or after the Exercise Date of the
Warrant Shares
that the Holder anticipated receiving from
the Company (a
"BUY-IN"), then the Company shall, within three Trading
Days
after the Holder's request and in the
Holder's discretion,
either (i) pay cash to the Holder in an amount
equal to the
Holder's total purchase
price (including brokerage
commissions, if any) for the shares
of Common Stock so
purchased (the "BUY-IN PRICE"), at which point the
Company's
obligation to deliver such
certificate (and to issue such
Common Stock) shall terminate, or (ii)
promptly honor its
obligation to deliver to the
Holder a certificate or
certificates representing such Common Stock and
pay cash to
the Holder in an amount equal to the excess (if
any) of the
Buy-In Price over the product of (A) such number of shares
of
Common Stock, times (B) the Closing Price on the date
of the
event giving rise to the Company's obligation to deliver
such
certificate. Notwithstanding the foregoing, the Company
shall
have
no liability under this subsection for the Buy-In
Price
if it has compiled with the requirements of
subsection 1.1
above and notwithstanding it using its best
efforts to have
its transfer agent deliver the Warrant Shares to the
Holders
within three trading days of the Holder's request such Warrant
Shares are not delivered on a timely basis.
2. DETERMINATION OR ADJUSTMENT OF
EXERCISE PRICE AND NUMBER OF SHARES. The
Exercise Price and the number of shares
purchasable upon the exercise of this
Class B Warrant shall be subject to
adjustment from time to time upon the
occurrence of certain events described in this Section 2.
Upon each adjustment
of the Exercise Price, the Holder of this Class B
Warrant shall thereafter be
entitled to purchase, at the Exercise Price resulting from such
adjustment, the
number of shares obtained by
multiplying the Exercise Price in
effect
immediately prior to such adjustment by
the number of shares purchasable
pursuant hereto immediately prior to such adjustment,
and dividing the product
thereof by the Exercise Price resulting from such adjustment.
2.A SUBDIVISION OR
COMBINATION OF COMMON STOCK. In case
the
Company shall at any time
subdivide or reclassify its
outstanding shares of Common Stock into a greater
number of
shares, the Exercise Price in effect immediately prior to such
subdivision shall be proportionately reduced, and
conversely,
in case the outstanding shares of Common Stock of the
Company
shall be combined or reclassified into a
smaller number of
shares, the Exercise Price in effect immediately prior to such
combination shall be proportionately increased.
2.B DIVIDENDS
IN COMMON STOCK,
OTHER STOCK, PROPERTY,
RECLASSIFICATION. If at any time or from
time to time the
holders of Common Stock (or any
shares of stock or other
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securities at the time receivable upon the
exercise of this
Class B Warrant) shall have received or
become entitled to
receive, without payment therefore:
2.B.A Stock, Common Stock or any shares of
capital stock or
other securities which are at any time directly
or
indirectly convertible into or
exchangeable for
Common Stock, or any rights or options to subscribe
for,
purchase or otherwise acquire any
of the
foregoing by way of dividend or other distribution,
2.B.B Any cash paid or payable
otherwise than as a cash
dividend, or
2.B.C Stock, Common Stock or
additional capital stock or
other securities or property (including cash) by way
of spinoff, split-up, reclassification, combination
of shares or similar corporate rearrangement, (other
than shares of Common Stock issued as a stock split
or adjustments in respect of which shall be covered
by
the terms of Section 2.1 above), then and in each
such case, the Holder hereof shall, upon the exercise
of this Class B Warrant, be entitled to receive, in
addition to the number of shares of Common Stock
or
other capital stock receivable thereupon, and without
payment of any additional consideration therefor, the
amount of stock and other securities and
property
(including cash in the cases referred to in
clause
(2.2.2) above and this clause (2.2.3))
which such
Holder would hold on the date of such exercise had he
been the holder of record of such Common Stock as of
the date on which holders of Common Stock received or
became entitled to receive such shares or all other
additional stock and other securities and property.
2.C REORGANIZATION,
RECLASSIFICATION, CONSOLIDATION, MERGER OR
SALE.
2.C.A If any
recapitalization, reclassification
or
reorganization of the capital stock of the Company,
or any consolidation or merger of the Company
with
another corporation, or
the sale of all or
substantially all of its assets or other transaction
shall be effected in such a way that
holders of
Common Stock shall be entitled to
receive stock,
securities, or other assets or property (an "ORGANIC
CHANGE"), then, as a condition
of such Organic
Change, lawful and adequate provisions shall be made
by
the Company whereby the Holder
hereof shall
thereafter have the right, upon
exercise of this
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Class B Warrant, to purchase and receive (in lieu of
the shares of the Common Stock
of the Company
immediately theretofore purchasable and
receivable
upon the exercise of the rights represented by this
Class B Warrant) such shares of stock, securities or
other assets or property as may be issued or payable
with respect to or in exchange for
a number of
outstanding shares of such Common Stock equal to the
number of shares of
such stock immediately
theretofore purchasable and
receivable upon the
exercise
of the rights represented by this Class B
Warrant. In the event of
any Organic Change,
appropriate provision shall be made by the
Company
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