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 (THE “ACT”) OR ANY STATE SECURITIES
LAWS. THIS WARRANT AND SUCH SECURITIES MAY NOT BE SOLD, OFFERED FOR
SALE, OR OTHERWISE TRANSFERRED
UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND ANY APPLICABLE STATE
SECURITIES LAWS, OR UPON RECEIPT BY THE COMPANY OF AN OPINION OF
COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT
REQUIRED.
2008-PN2
WARRANT TO PURCHASE SHARES
OF THE COMMON STOCK OF
ASKMENOW, INC.
(Void after Expiration Date –
February 27, 2011)
Issue
Date: February 27, 2008
This
certifies that Phillips Nizer LLP, a New York limited
liability partnership with a principal business address of 666
Fifth Avenue, New York, New York 10103
(or
any valid transferee thereof, the “
Holder ”),
for value received, shall be entitled to purchase from AskMeNow,
Inc., a Delaware corporation having its principal place of business
at 26 Executive Park, Suite 250, Irvine, California 92614 (together
with its successors and assigns, the “
Company ”),
subject to the terms and conditions set forth herein, Two Hundred
Thousand (200,000) fully paid and non-assessable shares of the
Company’s common stock, par value $.01 per share
(“
Common Stock ”),
at a price equal to $.22 per share, at any time and from time to
time commencing as of the issue date set forth above (the
“
Issue Date ”)
and continuing up to and including 12:00 p.m. (California time) on
February 27, 2011 (“
Expiration Date ”);
provided ,
however ,
if such date is not a Business Day, then on the Business Day
immediately following such date. The shares purchasable upon
exercise of this Warrant, and the purchase price per share, each as
adjusted from time to time pursuant to the provisions of this
Warrant, are hereinafter sometimes referred to as the
“
Warrant Shares ”
and the “
Exercise Price ,”
respectively.
1.
Exercise; Issuance of Certificates; Payment for Shares
.
1.
General .
This Warrant is exercisable 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 Warrant properly
endorsed with an exercise notice in substantially the form attached
hereto as
Schedule A duly
completed and signed and, if applicable, upon payment in cash,
certified or bank check or other immediately available funds of the
aggregate Exercise Price for the number of Warrant Shares for which
this Warrant is being exercised as determined in accordance with
the provisions hereof. This Warrant is exercisable in whole or in
part, in increments of 5,000 shares, and in no event shall any
exercise hereof be for fewer than 5,000 Warrant Shares unless fewer
than 5,000 Warrant Shares are then purchasable under this
Warrant. In
the case of the exercise for less than all of the Warrant Shares
represented by this Warrant, the Company shall cancel this Warrant
certificate upon the surrender hereof and shall execute and deliver
a new Warrant certificate or certificates of like tenor for the
balance of the Warrant Shares for which this Warrant has not yet
been exercised. The
Company agrees that the shares of Common Stock purchased under this
Warrant shall be deemed to be issued to the Holder hereof, and the
Holder deemed to be the record owner of such shares, as of
immediately prior to the close of business on the date on which the
exercise notice attached hereto as
Schedule A is
delivered, and this Warrant surrendered, to the Company as provided
herein (such date, the “
Exercise Date ”).
Certificates for the shares of Common Stock purchased upon
exercise, 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 Warrant have
been so exercised. Each Common Stock certificate so delivered shall
be in such denominations as may be requested by the Holder hereof
and shall be registered on the Company’s books in the name(s)
designated by such Holder.
1.2
Exercise for Cash .
This Warrant may be exercised, in whole at any time or in part from
time to time, commencing on the Issue Date and prior to 12:00 Noon
(California time) on the Expiration Date, for cash by delivery of
the exercise notice attached hereto as
Schedule A and
surrender of this Warrant to the Company, together with proper
payment of the aggregate Exercise Price payable hereunder for the
Warrant Shares being purchased upon such exercise for cash. Payment
for the Warrant Shares shall be made by cash, certified or bank
check or wire transfer of immediately available funds to the
Company. If this Warrant is exercised for cash in part, this
Warrant must be exercised for a number of whole shares of the
Common Stock, and the Holder is entitled to receive a new Warrant
covering the shares for which this Warrant has not yet been
exercised, in accordance with Section 1.1 above. Upon surrender of
this Warrant and payment in full of the aggregate Exercise Price
for the Warrant Shares then being purchased upon such exercise for
cash, the Company will 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 deliver the
other securities and properties receivable upon the exercise of
this Warrant, or the proportionate part thereof if this Warrant is
exercised in part, pursuant to the provisions of this Warrant, in
accordance with Section 1.1 above.
1.3
Cashless Exercise .
In lieu of exercising this Warrant for cash as set forth in Section
1.2 above, the Holder may at any time and from time to time elect
to receive, without the payment by the Holder of any additional
consideration, shares of Common Stock equal to the value of this
Warrant (or portion thereof) through a cashless exercise (a
“
Cashless Exercise ”),
as hereinafter provided. The Holder may effect a Cashless Exercise
by surrendering this Warrant to the Company and noting on the
Holder’s duly executed exercise notice attached hereto
as
Schedule A that
the Holder wishes to effect a Cashless Exercise, upon which the
Company shall issue to the Holder the number of shares determined
as follows:
X
= Y * (A-B) / A
where:
X
= the number of Warrant Shares to be issued to the Holder upon
the Cashless Exercise;
Y
= the number of Warrant Shares with respect to which this
Warrant is being exercised;
A
= the Market Price (as defined below) of one share of Common
Stock as of the Exercise Date; and
B
= the Exercise Price (as adjusted, if applicable).
“
Market Price ”
means, for any date, the average of the daily Closing Prices per
share of Common Stock for the 10 consecutive trading days
immediately prior to such date. The “
Closing Price ”
per share of Common Stock for each day shall be the last sale
price, regular way, or, in case no such sale takes place on such
day, the average closing bid and asked prices, regular way, in
either case as reported in the principal consolidated transaction
reporting system with respect to securities listed or admitted to
trading on the “Over the Counter Market”
(“
OTC BB ”),
the NASDAQ National Market System, the New York Stock Exchange or
the American Stock Exchange, as applicable. If on any such trading
day or days such securities are not quoted by any such
organization, such trading day or days shall be replaced for
purposes of the foregoing calculation by the requisite trading day
or days preceding the commencement of such 10 trading day period on
which such securities are so quoted. If shares of Common Stock are
not so listed or traded, the Market Price shall mean the fair value
per share of Common Stock as determined in good faith by the Board
of Directors of the Company, whose determination shall be described
in a notice to the Holder, based on (a) the most recently completed
arm’s-length transaction between the Company and a person
other than an existing shareholder or other affiliate of the
Company, the closing of which occurred on such date or within the
three-month period preceding such date, or (b) if no such
transaction shall have occurred on such date or within such
three-month period, the good faith reasonable judgment of the Board
of Directors.
For
purposes of Rule 144, it is intended and acknowledged that the
Warrant Shares issued in a Cashless Exercise transaction shall
be deemed to have been acquired by the Holder, and the holding
period for the Warrant Shares required by Rule 144 shall be
deemed to have been commenced, on the Issue Date.
1.4
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
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 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 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
Warrant. The
Company will take all such action as may be reasonably 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 any exercise
hereunder.
2.
Determination or Adjustment of Exercise Price and Number of
Shares .
The Exercise Price and the number of Warrant Shares purchasable
upon the exercise of this 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 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.
2.1
Subdivision or Combination of Common Stock .
If at any time after the Issue Date hereof and prior to the
exercise or Expiration Date hereof the Company shall 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 o
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