| |
WARRANT
|
|
|
NO. ________
|
CUSTOMER ACQUISITION NETWORK HOLDINGS, INC.
|
_______ Shares
|
WARRANT TO PURCHASE COMMON STOCK
VOID AFTER 5:30 P.M., EASTERN
TIME, ON THE EXPIRATION DATE
THIS WARRANT AND ANY SHARES ACQUIRED UPON THE EXERCISE OF THIS
WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE “ACT”), AND MAY NOT BE SOLD, PLEDGED,
HYPOTHECATED, DONATED OR OTHERWISE TRANSFERRED WITHOUT COMPLIANCE
WITH THE REGISTRATION OR QUALIFICATION PROVISIONS OF APPLICABLE
FEDERAL AND STATE SECURITIES LAWS OR APPLICABLE EXEMPTIONS
THEREFROM.
FOR
VALUE RECEIVED, CUSTOMER ACQUISITION NETWORK HOLDINGS, INC., a
Delaware corporation (the “Company”), hereby
agrees to sell upon the terms and on the conditions
hereinafter set forth, but no later than 5:30 p.m., Eastern
Time, on the Expiration Date (as hereinafter defined), to [ ],
or registered assigns (the “Holder”), under the
terms as hereinafter set forth, [ ] fully paid and
non-assessable shares of the Company’s Common Stock, par
value $0.001 per share (the “Warrant Stock”), at a
purchase price of $2.75 per share (the “Warrant
Price”), pursuant to this warrant (this
“Warrant”). The number of shares of Warrant Stock
to be so issued and the Warrant Price are subject to
adjustment in certain events as hereinafter set forth. The
term “Common Stock” shall mean, when used herein,
unless the context otherwise requires, the stock and other
securities and property at the time receivable upon the
exercise of this Warrant.
1.
Exercise of Warrant .
a.
The
Holder may exercise this Warrant according to its terms by (i)
surrendering this Warrant, properly endorsed, to the Company
at the address set forth in Section 10, (ii) the subscription
form attached hereto having then been duly executed by the
Holder, and (iii) payment of the purchase price being made to
the Company for the number of shares of the Warrant Stock
specified in the subscription form, or as otherwise provided
in this Warrant, prior to 5:30 p.m., Eastern Time, on March
28, 2013 (the
“
Expiration Date ”).
b.
(i)
The aggregate purchase price for the shares of Warrant Stock
being purchased may be paid (1) either by cash, certified
check or bank draft or wire transfer of immediately available
funds, or (2) subject to Section 1b.(ii) below, by surrender
of a number of shares of Warrant Stock having a fair market
value equal to the aggregate purchase price of the Warrant
Stock being purchased (“
Cashless Exercise ”)
as determined herein. If the Holder elects the Cashless Exercise
method of payment, the Company shall issue to the Holder a number
of shares of Warrant Stock determined in accordance with the
following formula:
X
=
Y(A - B)
A
| with: |
X = the
number of shares of Warrant Stock to be issued to the Holder
; |
| |
|
| |
Y
=
the
number of shares of Warrant Stock with respect to which the
Warrant is being exercised ;
|
| |
|
| |
A
=
the
fair value per share of Common
Stock on
the date of exercise of this Warrant ;
and
|
| |
|
| |
B
=
the
then-current Warrant Price of
the Warrant
|
For
the purposes of this Section 1b., “fair value” per
share of Common Stock shall mean (A) the average of the
closing sales prices, as quoted on the primary national or
regional stock exchange on which the Common Stock is listed,
or ,
if not listed, the
OTC Bulletin Board if quoted thereon, on the
five
consecutive trading days immediately preceding the date of
exercise, or (B) if the Common Stock is not publicly traded as
set forth above, as reasonably and in good faith determined by
the Board of Directors of the Company as of the date which the
notice of exercise is deemed to have been sent to the
Company.
(ii)
Notwithstanding the foregoing, the Cashless Exercise option
set forth in clause (i) of Section 1b. above shall only be
available so long as the Company shall not have registered the
Warrant Stock in an effective registration statement with the
Securities and Exchange Commission on or prior to the six
month anniversary of the date that this warrant is
issued.
c.
This
Warrant may be exercised in whole or in part so long as any
exercise in part hereof would not involve the issuance of
fractional shares of Warrant Stock. If exercised in part, the
Company shall deliver to the Holder a new Warrant, identical
in form, in the name of the Holder, evidencing the right to
purchase the number of shares of Warrant Stock as to which
this Warrant has not been exercised, which new Warrant shall
be signed by the Chairman, Chief Executive Officer, President
or any Vice President of the Company. The term Warrant as used
herein shall include any subsequent Warrant issued as provided
herein.
d.
No
fractional shares or scrip representing fractional shares
shall be issued upon the exercise of this Warrant. The Company
shall pay cash in lieu of fractions with respect to the
Warrants based upon the fair market value of such fractional
shares of Common Stock (which shall be the closing price of
such shares on the exchange or market on which the Common
Stock is then traded) at the time of exercise of this
Warrant.
e.
In
the event of any exercise of the rights represented by this
Warrant, a certificate or certificates for the Warrant Stock
so purchased, registered in the name of the Holder, shall be
delivered to the Holder within a reasonable time after such
rights shall have been so exercised. The person or entity in
whose name any certificate for the Warrant Stock is issued
upon exercise of the rights represented by this Warrant shall
for all purposes be deemed to have become the holder of record
of such shares immediately prior to the close of business on
the date on which the Warrant was surrendered and payment of
the Warrant Price and any applicable taxes was made,
irrespective of the date of delivery of such certificate,
except that, if the date of such surrender and payment is a
date when the stock transfer books of the Company are closed,
such person shall be deemed to have become the holder of such
shares at the opening of business on the next succeeding date
on which the stock transfer books are open. Except as provided
in Section 4 hereof, the Company shall pay any and all
documentary stamp or similar issue or transfer taxes payable
in respect of the issue or delivery of shares of Common Stock
on exercise of this Warrant; provided, however, that the
Company shall not be required to pay any tax that may be
payable in respect of any issuance and delivery of shares of
Warrant Stock to any Person other than the Holder or with
respect to any income tax due by the Holder with respect to
any shares of Warrant Stock. “Person” shall mean
any natural person, corporation, division of a corporation,
partnership, limited liability company, trust, joint venture,
association, company, estate, unincorporated organization or
government or any agency or political subdivision
thereof.
2.
Disposition of Warrant Stock and Warrant .
a.
The
Holder hereby acknowledges that this Warrant and any Warrant
Stock purchased pursuant hereto are, as of the date hereof,
not registered: (i) under the Act on the ground that the
issuance of this Warrant is exempt from registration under
Section 4(2) of the Act as not involving any public offering
or (ii) under any applicable state securities law because the
issuance of this Warrant does not involve any public offering;
and that the Company’s reliance on the Section 4(2)
exemption of the Act and under applicable state securities
laws is predicated in part on the representations hereby made
to the Company by the Holder that it is acquiring this Warrant
and will acquire the Warrant Stock for investment for its own
account, with no present intention of dividing its
participation with others or reselling or otherwise
distributing the same, subject, nevertheless, to any
requirement of law that the disposition of its property shall
at all times be within its control.
The
Holder hereby agrees that it will not sell or transfer all or
any part of this Warrant and/or Warrant Stock, except pursuant
to an effective registration statement under the Act, unless
and until it shall first have given notice to the Company
describing such sale or transfer and furnished to the Company
either (i) an opinion of counsel for the Company, which the
Company shall obtain at its own expense, to the effect that
the proposed sale or transfer may be made without registration
under the Act and without registration or qualification under
any state law, or (ii) an interpretative letter from the
Securities and Exchange Commission to the effect that no
enforcement action will be recommended if the proposed sale or
transfer is made without registration under the
Act.
b.
If,
at the time of issuance of the shares issuable upon exercise
of this Warrant, no registration statement is in effect with
respect to such shares under applicable provisions of the Act,
the Company may at its election require that the Holder
provide the Company with written reconfirmation of the
Holder’s investment intent and that any stock
certificate delivered to the Holder of a surrendered Warrant
shall bear a legend reading substantially as
follows:
“THE
SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE
SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933 OR AN OPINION OF COUNSEL SATISFACTORY
TO THE ISSUER OF THIS CERTIFICATE THAT REGISTRATION IS NOT
REQUIRED UNDER SAID ACT.”
In
addition, so long as the foregoing legend may remain on any
stock certificate delivered to the Holder, the Company may
maintain appropriate “stop transfer” orders with
respect to such certificates and the shares represented
thereby on its books and records and with those to whom it may
delegate registrar and transfer functions.
3.
Reservation of Shares .
The Company hereby agrees that at all times there shall be reserved
for issuance upon the exercise of this Warrant such number of
shares of its Common Stock as shall be required for issuance upon
exercise of this Warrant. The Company further agrees that all
shares which may be issued upon the exercise of the rights
represented by this Warrant will be duly authorized and will, upon
issuance and against payment of the Warrant Price therefor, be
validly issued, fully paid and non-assessable, free from all taxes,
liens, charges and preemptive rights with respect to the issuance
thereof, other than taxes, if any, in respect of any transfer
occurring contemporaneously with such issuance and other than
transfer restrictions imposed by federal and state securities
laws.
4.
Exchange, Transfer or Assignment of Warrant .
a.
This
Warrant is exchangeable, without expense, at the option of the
Holder, upon presentation and surrender hereof to the Company
or at the office of i
|
