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EXHIBIT B
FORM OF WARRANT
AIRBEE WIRELESS, INC.
WARRANT TO PURCHASE COMMON STOCK
WC-2008-
THE OFFER AND SALE OF THE SECURITIES EVIDENCED BY THIS WARRANT HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
(THE “
ACT
”) OR QUALIFIED UNDER STATE SECURITIES LAWS AND SUCH
SECURITIES MAY NOT BE SOLD, TRANSFERRED, ASSIGNED OR HYPOTHECATED
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
ACT AND EFFECTIVE QUALIFICATION THEREOF OR IF SUCH SALE, TRANSFER,
ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND
PROSPECTUS DELIVERY REQUIREMENTS OF THE ACT AND THE QUALIFICATION
REQUIREMENTS OF THE RELEVANT STATE.
This
certifies that, for good and valuable consideration, receipt
of which is hereby acknowledged, Richard P. Sommerfeld (the
“
Holder ”),
and/or its assigns, is entitled to purchase, from time to time and
subject to the terms and conditions of this Warrant, from AIRBEE
WIRELESS, INC., a Delaware corporation (the “
Company ”),
fully paid and non-assessable shares of Common Stock of the
Company, par value $0.00004 per share (each, a “
Share ”
and collectively, the “
Shares ”),
in accordance with the terms hereof, during the period commencing
on the date set forth on the signature page hereof (the
“
Commencement Date ”).
Terms not defined herein shall have the meaning ascribed to them in
the Settlement Agreement being executed contemporaneously herewith
(the “
Settlement Agreement ”).
If there is any conflict between the terms of the Settlement
Agreement and this Warrant, the Settlement Agreement shall govern.
If this Warrant is silent as to any term, the terms of the
Settlement Agreement shall govern.
1.
Number of Shares; Vesting; Exercise Price and Expiration
Date .
(a) This
Warrant may be exercised for 2,841,667 Shares.
(b) The
right to exercise this Warrant shall fully vest on the
Commencement Date.
(c) The
exercise or purchase price for the Shares shall be 1,550,000
warrants @ $0.10 per share, 775,000 warrants @ $0.20 per share
and 516,667 warrants @ $0.30 per share. Such price shall be
subject to adjustment pursuant to the terms hereof (such
price, as adjusted from time to time, is hereinafter referred
to as the “
Exercise Price ”).
(d) The
purchase right represented by this Warrant shall terminate on
or before 5 p.m. Pacific standard time, on the fifth (5th)
anniversary of the Commencement Date (the “
Expiration Date ”).
2.
Exercise and Payment .
(a)
Cash Exercise .
At any time after the Commencement Date, this Warrant may be
exercised in whole or in part, from time to time, by the Holder by
surrender of this Warrant and the Notice of Exercise annexed hereto
duly (the “Notice of Exercise”) completed and executed
by the Holder to the Company at the principal executive offices of
the Company, together with payment in the amount obtained by
multiplying the Exercise Price then in effect by the number of
Shares thereby purchased, as designated in the Notice of Exercise.
Payment may be in cash or by check payable to the order of the
Company.
(b)
Net Issuance Exercise .
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), then in lieu of the payment methods set forth in Section
2(a) hereof, this Warrant may be exercised in whole or in part, by
the Holder by electing to exchange all or some of this Warrant for
Warrant Shares equal to the value of the amount of the Warrant
being exchanged on the date of exchange. If the Holder elects to
exchange this Warrant as provided in this Section 2(b), Holder
shall surrender this Warrant and the Notice of Exercise completed
and executed by the Holder to the Company at the principal
executive offices of the Company, and the Company shall issue to
the Holder the number of Warrant Shares computed using the
following formula:
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X
=
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(A*B)-(A*C)
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X
=
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The
number of Warrant Shares to be issued to the
Holder.
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A
=
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The
total number of Warrant Shares with respect to which
this
Warrant
is then being exercised.
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B
=
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The
Fair Market Value of one Warrant Share on the date
of
exercise
of this Warrant.
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C
=
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The
Exercise Price then in effect on the date of exercise
of
this
Warrant.
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For
purposes of this Section 2(b), “
Fair Market Value ”
shall be determined on a per Share basis as of the close of the
business day preceding the date of exercise, which determination
shall be made as follows: (a) if the Common Stock is listed on
a national securities exchange or admitted to unlisted trading
privileges on such an exchange or quoted on any automated quotation
service operated by The Nasdaq Stock Market, Inc., the Fair Market
Value shall be the last reported sale price of that security on
such exchange or system on the day for which the current market
price is to be determined or, if no such sale is made on such day,
the average of the highest closing bid and lowest asked price for
such day on such exchange or system; (b) if the Common Stock
is not so listed or quoted or admitted to unlisted trading
privileges, the Fair Market Value shall be the average of the last
reported highest bid and lowest asked prices quoted on the Nasdaq
Electronic Bulletin Board, or, if not so quoted, then by the
National Quotation Bureau, Inc. on the last business day prior to
the day for which the Fair Market Value is to be determined; or
(c) if the Common Stock is not so listed or quoted or admitted
to unlisted trading privileges and bid and asked prices are not
reported, the Fair Market Value shall be determined by the
Company’s Board of Directors in its reasonable, good faith
judgment.
(c)
Mandatory Exercise .
Promptly following the first consecutive ten (10) trading day
period of time prior to the Expiration Date during which the
closing sale price of the Company’s Common Stock, as reported
by the Nasdaq National Market or other securities exchange on which
the Company’s Common Stock is then listed, is equal to or
greater than 300% of the Exercise Price on each day during such
period, the Company shall deliver to the Holder a Mandatory
Exercise Notice, together with a computation demonstrating the
basis for such Mandatory Exercise Notice. In such event,
notwithstanding anything to the contrary in Section 2(a) or Section
2(b) above, the Holder agrees to exercise this Warrant in full
within ten (10) days following receipt of the Mandatory
Exercise Notice from the Company. To the extent that this Warrant
is not so exercised, it shall expire and be of no further force or
effect. For purposes of this Warrant, “
Mandatory Exercise Notice ”
shall mean the notice delivered by the Company to the Holder
advising the Holder that the closing sale price of the
Company’s Common Stock, as reported by the Nasdaq National
Market or other securities exchange on which the Company’s
Common Stock is then listed, has been equal to or greater than 300%
of the Exercise Price (as adjusted for splits, reverse splits,
stock dividends, share combinations and the like) for ten
(10) consecutive trading days.
3.
Delivery of Certificates .
Within a reasonable time after exercise, in whole or in part, of
this Warrant, the Company shall issue in the name of and deliver to
the Holder, a certificate or certificates for the number of fully
paid and nonassessable Shares which the Holder shall have requested
in the Notice of Exercise. If this Warrant is exercised in part,
the Company shall deliver to the Holder a new Warrant for the
unexercised portion of this Warrant at the time of delivery of such
certificate or certificates.
4.
No Fractional Shares .
No fractional Shares or scrip representing fractional Shares will
be issued upon exercise of this Warrant. If upon any exercise of
this Warrant a fraction of a Share results, the Company will pay
the Holder the difference between the cash value of the fractional
Share and the portion of the Exercise Price allocable to the
fractional Share.
5.
Charges, Taxes and Expenses .
The Holder shall pay all transfer taxes or other incidental
charges, if any, in connection with the transfer of the Shares
purchased pursuant to the exercise hereof from the Company to the
Holder.
6.
Loss, Theft, Destruction or Mutilation of Warrant
.
Upon receipt by the Company of evidence reasonably satisfactory to
it of the loss, theft, destruction or mutilation of this Warrant,
and in case of loss, theft or destruction, of indemnity or security
reasonably satisfactory to the Company, and upon reimbursement to
the Company of all reasonable expenses incidental thereto, and upon
surrender and cancellation of this Warrant, if mutilated, the
Company will make and deliver a new Warrant of like tenor and dated
as of such cancellation, in lieu of this Warrant.
7.
Saturdays, Sundays, Holidays, Etc. If
the last or appointed day for the taking of any action or the
expiration of any right required or granted herein shall be a
Saturday or a Sunday or shall be a legal holiday, then such action
may be taken or such right may be exercised on the next succeeding
weekday which is not a legal holiday.
8
Adjustment of Exercise Price and Number of Shares
.
The number of securities purchasable upon exercise of this Warrant
and the Exercise Price shall be subject to adjustment from time to
time as follows:
(a)
Subdivisions, Combinations and Other Issuances
.
If the Company shall at any time after the date hereof but prior to
the expiration of this Warrant subdivide its outstanding securities
as to which purchase rights under this Warrant exist, by split-up
or otherwise, or combine its outstanding securities as to which
purchase rights under this Warrant exist, the number of Shares as
to which this Warrant is exercisable as of the date of such
subdivision, split-up or combin
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