THIS WARRANT AND THE SHARES OF
COMMON STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
STATE SECURITIES LAWS. THIS WARRANT AND THE COMMON STOCK ISSUABLE
UPON EXERCISE OF THIS WARRANT MAY NOT BE SOLD, OFFERED FOR SALE,
PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT AS TO THIS WARRANT UNDER SAID ACT AND ANY APPLICABLE
STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO IBROADBAND, INC. THAT SUCH REGISTRATION IS NOT
REQUIRED.
Right to Purchase up to 2,578,000
Shares of Common Stock of
iBroadband, Inc.
(subject to adjustment as provided herein)
COMMON STOCK PURCHASE
WARRANT
No. _________________
Issue Date: December 4,
2006
iBroadband, Inc., a corporation
organized under the laws of the State of Nevada (the
“Company”), hereby certifies that, for value received,
RAYMOND J. NAWARA, or assigns (the “Holder”), is
entitled, subject to the terms set forth below, to purchase from
the Company (as defined herein) from and after the Issue Date of
this Warrant and at any, up to 2,578,000 fully paid and
nonassessable shares of Common Stock (as hereinafter defined),
$0.001 par value per share, at the applicable Exercise Price per
share (as defined below). The number and character of such
shares of Common Stock and the applicable Exercise Price per share
are subject to adjustment as provided herein.
As used herein the following terms,
unless the context otherwise requires, have the following
respective meanings:
A. The term “Company”
shall include iBrodband, Inc. and any person or entity which shall
succeed, or assume the obligations of, iBroadband, Inc.
hereunder.
B. The term “Common
Stock” includes (i) the Company’s Common Stock, par
value $0.001 per share; and (ii) any other securities into which or
for which any of the securities described in the preceding clause
(i) may be converted or exchanged pursuant to a plan of
recapitalization, reorganization, merger, sale of assets or
otherwise.
C. The term “Other
Securities” refers to any stock (other than Common Stock) and
other securities of the Company or any other person (corporate or
otherwise) which the holder of the Warrant at any time shall be
entitled to receive, or shall have received, on the exercise of the
Warrant, in lieu of or in addition to Common Stock, or which at any
time shall be issuable or shall have been issued in exchange for or
in replacement of Common Stock or Other Securities pursuant to
Section 4 or otherwise.
D. The “Exercise
Price” applicable under this Warrant shall be $0.001 per
share.
1. Exercise of Warrant
.
1.1 Number of Shares Issuable
upon Exercise . From and after the date hereof, the
Holder shall be entitled to receive, upon exercise of this Warrant
in whole or in part, by delivery of an original or fax copy of an
exercise notice in the form attached hereto as Exhibit A (the
“Exercise Notice”), shares of Common Stock of the
Company, subject to adjustment pursuant to Section 4.
1.2 Fair Market Value .
For purposes hereof, the “Fair Market Value” of a
share of Common Stock as of a particular date (the
“Determination Date”) shall mean:
(a) If the Company’s Common
Stock is traded on the American Stock Exchange or another national
exchange or is quoted on the National or Capital Market of The
Nasdaq Stock Market, Inc. (“Nasdaq”), then the closing
or last sale price, respectively, reported for the last business
day immediately preceding the Determination Date.
(b) If the Company’s Common
Stock is not traded on the American Stock Exchange or another
national exchange or on the Nasdaq but is traded on the NASD Over
The Counter Bulletin Board, then the mean of the average of the
closing bid and asked prices reported for the last business day
immediately preceding the Determination Date.
(c) 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
agreement by arbitration in accordance with the rules then in
effect 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.
(d) 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
share 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 for the purposes
of this clause (d) that all of the shares of Common Stock then
issuable upon exercise of the Warrant are outstanding at the
Determination Date.
1.3 Company Acknowledgment .
The Company will, at the time of the partial exercise of this
Warrant, upon the request of the holder hereof acknowledge in
writing its continuing obligation to afford to such holder any
rights to which such holder shall continue to be entitled after
such exercise in accordance with the provisions of this Warrant. If
the holder shall fail to make any such request, such failure shall
not affect the continuing obligation of the Company to afford to
such holder any such rights.
1.4 Trustee for Warrant
Holders . In the event that a bank or trust company shall
have been appointed as trustee for the holders of this Warrant
pursuant to Subsection 3.2, such bank or trust company shall have
all the powers and duties of a warrant agent (as hereinafter
described) and shall accept, in its own name for the account of the
Company or such successor person as may be entitled thereto, all
amounts otherwise payable to the Company or such successor, as the
case may be, on exercise of this Warrant pursuant to this Section
1.
2. Procedure for
Exercise .
2.1 Delivery of Stock
Certificates, Etc., on Exercise . The Company agrees that the shares of
Common Stock purchased upon exercise of this Warrant shall be
deemed to be issued to the Holder as the record owner of such
shares as of the close of business on the date on which this
Warrant shall have been surrendered and payment made for such
shares in accordance herewith. As soon as practicable after
the exercise of this Warrant in full or in part, upon receipt of
appropriate consideration from the Holder pursuant to the terms
hereof (if any), 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, 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, plus, in lieu
of any fractional share to which such holder would otherwise be
entitled, cash equal to such fraction multiplied by the then Fair
Market Value of one full share, together with any other stock or
other securities and property (including cash, where applicable) to
which such Holder is entitled upon such exercise pursuant to
Section 1 or otherwise.
2.2 Exercise
.
(a) Payment may be made either (i)
in cash of immediately available funds or by certified or official
bank check payable to the order of the Company equal to the
applicable aggregate Exercise Price, (ii) by delivery of this
Warrant, or shares of Common Stock and/or Common Stock receivable
upon exercise of this Warrant in accordance with the formula set
forth in subsection (b) below, or (iii) by a combination of any of
the foregoing methods, for the number of Common Shares specified in
such Exercise Notice (as such exercise number shall be adjusted to
reflect any adjustment in the total number of shares of Common
Stock issuable to the Holder per the terms of this Warrant) and the
Holder shall thereupon be entitled to receive the number of duly
authorized, validly issued, fully-paid and non-assessable shares of
Common Stock (or Other Securities) determined as provided
herein.
(b) Notwithstanding any provisions
herein to the contrary, if the Fair Market Value of one share of
Common Stock is greater than the Exercise Price (at the date of
calculation as set forth below), in lieu of exercising this Warrant
for cash, the Holder may elect to receive shares equal to the value
(as determined below) of this Warrant (or the portion thereof being
exercised) by surrender of this Warrant at the principal office of
the Company together with the properly endorsed Exercise Notice in
which event the Company shall issue to the Holder a number of
shares of Common Stock computed using the following
formula:
X=
_ Y(A-B)_
A
Where X =
the number of shares of Common Stock
to be issued to the Holder
Y =
the number of shares of Common Stock
purchasable under this Warrant or, if only a portion of this
Warrant is being exercised, the portion of this Warrant being
exercised (at the date of such calculation)
A =
the Fair Market Value of one share
of the Company’s Common Stock (at the date of such
calculation)
B =
the Exercise Price per share (as
adjusted to the date of such calculation)
3. Effect of Reorganization,
Etc.; Adjustment of Exercise Price .
3.1 Reorganization,
Consolidation, Merger, Etc . In case at any time or from time to
time, the Company shall (a) effect a reorganization, (b)
consolidate with or merge into any other person, or (c) transfer
all or substantially all of its properties or assets to any other
person under any plan or arrangement contemplating the dissolution
of the Company, then, in each such case, as a condition to the
consummation of such a transaction, proper and adequate provision
shall be made by the Company whereby the Holder, on the exercise
hereof as provided in Section 1 at any time after the consummation
of such reorganization, consolidation or merger or the effective
date of such dissolution, as the case may be, shall receive, in
lieu of the Common Stock (or Other Securities) issuable
on
