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THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF
HAVE NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
AMENDED (THE
"SECURITIES ACT"), OR ANY STATE SECURITIES LAW, AND MAY NOT BE
SOLD,
TRANSFERRED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF OR
EXERCISED UNLESS
(i) A REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND
APPLICABLE STATE
SECURITIES LAWS SHALL HAVE BECOME EFFECTIVE WITH REGARD THERETO,
OR (ii) AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT AND
APPLICABLE STATE
SECURITIES LAWS IS AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE
OR TRANSFER.
AN INVESTMENT IN THESE SECURITIES INVOLVES A HIGH DEGREE OF
RISK. SUBSCRIBERS
MUST RELY ON THEIR OWN ANALYSIS OF THE INVESTMENT AND ASSESSMENT
OF THE RISKS
INVOLVED.
Warrant to Purchase
________ shares
WARRANT TO PURCHASE COMMON STOCK
OF
ALANCO TECHNOLOGIES, INC.
THIS CERTIFIES that ________________________ or any subsequent
holder
hereof in accordance with Section 9 ("Holder"), has the right to
purchase from
ALANCO TECHNOLOGIES, INC., an Arizona corporation (the
"Company"), up to
__________________ fully paid and nonassessable shares of the
Company's Class A
common stock ("Common Stock"), subject to adjustment as provided
herein, at a
price equal to the Exercise Price as defined in Section 3 below,
at any time
beginning on the Date of Issuance (as defined below) and ending
at 5:00 p.m.,
Phoenix, Arizona time, on July 31, 2010 (the "Exercise
Period").
Holder agrees with the Company that this Warrant to Purchase
Common
Stock of Alanco Technologies, Inc. (this "Warrant") is issued
and all rights
hereunder shall be held subject to all of the conditions,
limitations and
provisions set forth herein.
1. Date of Issuance.
This Warrant shall be deemed to be issued on _____________,
2007. ("Date of Issuance").
2. Exercise.
(a) Manner of Exercise. During the Exercise Period, this
Warrant may be exercised as to all or any lesser number of full
shares of Common
Stock covered hereby upon surrender of this Warrant, with the
Exercise Form
attached hereto as Exhibit A (the "Exercise Form") duly
completed and executed,
together with the full Exercise Price (as defined below) for
each share of
Common Stock as to which this Warrant is exercised, at the
office of the Company
or at such other office or agency as the Company may designate
in writing, (such
surrender and payment of the Exercise Price hereinafter called
the "Exercise of
this Warrant").
(b) Date of Exercise. The "Date of Exercise" of the Warrant
shall be defined as the date on which this Warrant is received
by the Company,
together with the full Exercise Price, in accordance with
Section 2(a) above.
(c) Cancellation of Warrant. This Warrant shall be canceled
upon the Exercise of this Warrant, and, as soon as practicable
after the Date of
Exercise, Holder shall be entitled to receive Common Stock for
the number of
shares purchased upon such Exercise of this Warrant, and if this
Warrant is not
exercised in full, Holder shall be entitled to receive a new
Warrant (containing
terms identical to this Warrant) representing any unexercised
portion of this
Warrant in addition to such Common Stock.
(d) Holder of Record. Each person in whose name any Warrant
for shares of Common Stock is issued shall, for all purposes, be
deemed to be
the Holder of record of such shares on the Date of Exercise of
this Warrant,
irrespective of the date of delivery of the Common Stock
purchased upon the
Exercise of this Warrant. Nothing in this Warrant shall be
construed as
conferring upon Holder any rights as a stockholder of the
Company.
3. Payment of Warrant Exercise Price.
The Exercise Price shall equal $3.00 per share of Common
Stock
("Exercise Price"), subject to adjustment in accordance with
Section 6 hereof.
Payment of the Exercise Price shall be made by cash, cashiers
check or wire
transfer.
4. Redemption.
This Warrant shall be redeemable at the option of the
Company
at a price equal to: (i) $.01, multiplied by (ii) the number of
Shares issuable
upon the exercise of this Warrant upon occurrence of the
following described
event. The Company may redeem the warrant upon 10 days' written
notice to the
Holder hereof, so long as the closing price quoted on the Nasdaq
Capital Market,
or if the Common Stock is not traded on the Nasdaq Capital
Market, on any
exchange or trading system on which the Common Stock is trading,
is $5.00 or
greater (as equitably adjusted for stock splits, dividends,
combinations,
mergers or other events as contemplated in Section 6 below) for
ten (10)
consecutive trading days prior to the date of the notice of
redemption. If the
Common Stock is/was not traded during the ten trading days prior
to the date of
such notice, then the closing price for the last publicly traded
day shall be
deemed to be the closing price for any and all (if applicable)
days during such
ten trading day period.
<PAGE>
5. Transfer and Registration.
(a) Transfer Rights. Subject to the provisions of Section 9
of
this Warrant, this Warrant may be transferred on the books of
the Company, in
whole or in part, in person or by attorney, upon surrender of
this Warrant
properly completed and endorsed. This Warrant shall be canceled
upon such
surrender and, as soon as practicable thereafter, the person to
whom such
transfer is made shall be entitled to receive a new Warrant or
Warrants as to
the portion of this Warrant transferred, and Holder shall be
entitled to receive
a new Warrant as to the portion hereof retained.
(b) Registrable Securities. The Common Stock issuable upon
the
exercise of this Warrant constitutes "Registrable Securities"
under the
Declaration of Registration Rights issued by the Company in
connection with the
Warrant and, accordingly, has the benefit of the registration
rights pursuant to
that Declaration.
6. Adjustments to Exercise Price.
(a) Adjustment to Exercise Price Due to Stock Split, Stock
Dividend, Etc. If, prior to the exercise in full of this Warrant
the number of
outstanding shares of Common Stock is increased by a stock
split, stock
dividend, or other similar event, the Exercise Price shall be
proportionately
reduced and the number of shares issuable upon exercise of this
Warrant
proportionately increased, or if the number of outstanding
shares of Common
Stock is decreased by a combination or reclassification of
shares, or other
similar event, the Exercise Price shall be proportionately
increased and the
number of shares issuable upon exercise of this Warrant
proportionately
decreased.
(b) Adjustment Due to Merger, Consolidation, Etc. If, prior
to
the exercise in full of this Warrant, there shall be any merger,
consolidation,
exchange of shares, recapitalization, reorganization, or other
similar event, as
a result of which shares of Common Stock of the Company shall be
changed into
the same or a different number of shares of t
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