EXHIBIT 10.21
FORM OF WARRANT
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND MAY NOT BE SOLD, OFFERED FOR SALE, ASSIGNED, TRANSFERRED OR OTHERWISE
DISPOSED OF, UNLESS REGISTERED PURSUANT TO THE PROVISIONS OF THE SECURITIES ACT
OR AN OPINION OF COUNSEL IS OBTAINED STATING THAT SUCH DISPOSITION IS IN
COMPLIANCE WITH AN AVAILABLE EXEMPTION FROM SUCH REGISTRATION.
July 28, 2008
▇▇▇▇▇▇▇ NING
------------
Warrant for the Purchase of Common Stock (Void after July 27, 2013)
----------------------------------------
No. W-5
FOR VALUE RECEIVED, this Warrant is hereby issued by IA GLOBAL, INC., a
Delaware corporation (the "Company"), to ▇▇▇▇▇▇▇ NING, an American citizen (the
"Holder"). Subject to the provisions of this Warrant, the Company hereby grants
to Holder the right to purchase 1,900,000 shares of the Company's common stock,
par value $.01 per share ("Common Stock"), at US$0.17 per share ("Exercise
Price") during the period from July 28, 2008 to sixty months (60) months
following the Closing (as defined in the Subscription Agreement (the "Purchase
Agreement")).
The Holder agrees with the Company that this Warrant is issued, and all
the rights hereunder shall be held, subject to all of the conditions,
limitations and provisions set forth herein.
1. EXERCISE OF WARRANT. Subject to the terms and conditions set forth
herein, the Holder may exercise this Warrant on or after July 28, 2008 and no
later than July 27, 2013. To exercise this Warrant the Holder shall present and
surrender this Warrant to the Company at its principal office, with the Warrant
Exercise Form, attached hereto as Appendix A, duly executed by the Holder and
accompanied by payment in cash or by check, payable to the order of the Company,
of the aggregate Exercise Price for the total aggregate number of securities for
which this Warrant is exercised or a cashless exercise at the sole decision of
the Holder. The Common Stock deliverable upon such exercise, and as adjusted
from time to time, are hereinafter referred to as "Warrant Stock."
Upon receipt by the Company of this Warrant, together with the executed
Warrant Exercise Form and payment of the Exercise Price, if any, for the
securities to be acquired, in proper form for exercise, and subject to the
Holder's compliance with all requirements of this Warrant for the exercise
hereof, the Holder shall be deemed to be the holder of record of the Warrant
Stock issuable upon such exercise, notwithstanding that the stock transfer books
of the Company shall then be closed or that certificates representing such
securities shall not then be actually delivered to the Holder; provided,
however, that no exercise of this Warrant shall be effective, and the Company
1
shall have no obligation to issue any Warrant Stock to the Holder upon any
attempted exercise of this Warrant, unless the Holder shall have first delivered
to the Company, in form and substance reasonably satisfactory to the Company,
appropriate representations so as to provide the Company reasonable assurances
that the securities issuable upon exercise may be issued without violation of
the registration requirements of the Securities Act and applicable state
securities laws, including without limitation representations that the
exercising Holder is an "accredited investor" as defined in Regulation D under
the Securities Act and that the Holder is familiar with the Company and its
business and financial condition and has had an opportunity to ask questions and
receive documents relating thereto to his reasonable satisfaction.
2. RESERVATION OF SHARES. The Company will reserve for issuance and
delivery upon exercise of this Warrant all shares of Warrant Stock. All such
shares shall be duly authorized and, when issued upon such exercise, shall be
validly issued, fully paid and non-assessable and free of all preemptive rights.
3. ASSIGNMENT OR LOSS OF WARRANT. Subject to the transfer restrictions
herein (including Section 6), upon surrender of this Warrant to the Company or
at the office of its stock transfer agent, if any, with the Assignment Form,
attached hereto as Appendix B, duly executed and funds sufficient to pay any
transfer tax, the Company shall, without charge, execute and deliver a new
Warrant in the name of the assignee named in such instrument of assignment and
this Warrant shall promptly be canceled. Upon receipt by the Company of evidence
reasonably satisfactory to it of the loss, theft, destruction or mutilation of
this Warrant, and of reasonably satisfactory indemnification by the Holder, and
upon surrender and cancellation of this Warrant, if mutilated, the Company shall
execute and deliver a replacement Warrant of like tenor and date.
4. RIGHTS OF THE HOLDER. The Holder shall not, by virtue hereof, be
entitled to any rights of a stockholder in the Company, either at law or in
equity, and the rights of the Holder are limited to those expressed in this
Warrant.
5. ADJUSTMENTS.
(a) ADJUSTMENT FOR RECAPITALIZATION. If the Company shall at
any time after the date hereof subdivide its outstanding shares of Common Stock
by recapitalization, reclassification or split-up thereof, or if the Company
shall declare a stock dividend or distribute shares of Common Stock to its
shareholders, the number of shares of Common Stock subject to this Warrant
immediately prior to such subdivision shall be proportionately increased, and if
the Company shall at any time after the date hereof combine the outstanding
shares of Common Stock by recapitalization, reclassification or combination
thereof, the number of shares of Common Stock subject to this Warrant
immediately prior to such combination shall be proportionately decreased.
(b) ADJUSTMENT FOR REORGANIZATION, CONSOLIDATION, MERGER, ETC.
If at any time after the date hereof the Company has a Change in Control, the
Holder agrees that, either (a) Holder shall exercise its purchase right under
this Warrant and such exercise will be deemed effective immediately prior to the
consummation of such Change in Control or (b) if the Holder elects not to
2
exercise the Warrant, this Warrant will expire upon the consummation of the
Change of Control. For purposes of this Warrant, a "Change in Control" shall be
deemed to occur in the event of a change in ownership or control of the Company
effected through any of the following transactions: (i) the acquisition,
directly or indirectly, by any person or related group of persons (other than
the Company or a person that immediately before the Change of Control directly
or indirectly controls, or is controlled by, or is under common control with,
the Company) of beneficial ownership (within the meaning of Rule 13d-3 of the
Securities Exchange Act of 1934, as amended) of outstanding securities
possessing more than fifty percent (50%) of the total combined voting power of
the Company's outstanding securities; or (ii) the sale, transfer or other
disposition of all or substantially all of the Company's assets; or (iii) the
consummation of a merger or consolidation of the Company with or into another
entity or any other corporate reorganization, if more than fifty percent (50%)
of the combined voting power of the continuing or surviving entity's securities
outstanding immediately after such merger, consolidation or other reorganization
is owned by persons who were not stockholders of the Company immediately prior
to such merger, consolidation or other reorganization.
(c) CERTIFICATE AS TO ADJUSTMENTS. The adjustments provided in
this Section 5 shall be interpreted and applied by the Company in such a fashion
so as to reasonably preserve the applicability and benefits of this Warrant (but
not to increase or diminish the benefits hereunder). In each case of an
adjustment in the number of shares of Common Stock receivable on the exercise of
the Warrant, the Company at its expense will promptly compute such adjustment in
accordance with the terms of the Warrant and prepare a certificate executed by
two executive officers of the Company setting forth such adjustment and showing
in detail the facts upon which such adjustment is based. The Company will mail a
copy of each such certificate to each Holder.
(d) NOTICES OF RECORD DATE, ETC. In the event that:
(i) the Company shall declare any dividend or other
distribution to the holders of Common Stock, or authorizes the granting to
Common Stock holders of any right to subscribe for, purchase or otherwise
acquire any shares of stock of any class or any other securities; or
(ii) the Company has a Change in Control; or
(iii) the Company authorizes any voluntary or
involuntary dissolution, liquidation or winding up of the Company,
then, and in each such case, the Company shall mail or cause to be mailed to the
holder of this Warrant at the time outstanding a notice specifying, as the case
may be, (a) the date on which a record is to be taken for the purpose of such
dividend, distribution or right, and stating the amount and character of such
dividend, distribution or right, or (b) the date on which such reorganization,
reclassification, consolidation, merger, conveyance, dissolution, liquidation or
winding up is to take place, and the time, if any is to be fixed, as to which
the holders of record of Common Stock shall be entitled to exchange their shares
of Common Stock for securities or other property deliverable upon such
3
reorganization, reclassification, consolidation, merger, conveyance,
dissolution, liquidation or winding up. Such notice shall be mailed at least 20
days prior to the date therein specified.
(e) NO IMPAIRMENT. The Company will not, by any voluntary
action, avoid or seek to avoid the observance or performance of any of the terms
to be observed or performed hereunder by the Company, but will at all times in
good faith assist in the carrying out of all the provisions of this Section 5
and in the taking of all such action as may be necessary or appropriate in order
to protect the rights of the Holder of this Warrant against impairment.
6. TRANSFER TO COMPLY WITH THE SECURITIES ACT. This Warrant and any
Warrant Stock may not be sold, transferred, pledged, hypothecated or otherwise
disposed of except as follows: (a) to a person who, in the opinion of counsel to
the Company, is a person to whom this Warrant or the Warrant Stock may legally
be transferred without registration and without the delivery of a current
prospectus under the Securities Act with respect thereto and then only against
receipt of an agreement of such person to comply with the provisions of this
Section 6 with respect to any resale or other disposition of such securities; or
(b) to any person upon delivery of a prospectus then meeting the requirements of
the Securities Act relating to such securities and the offering thereof for such
sale or disposition, and thereafter to all successive assignees.
7. LEGEND. Unless the shares of Warrant Stock have been registered
under the Securities Act, upon exercise of this Warrant and the issuance of any
of the shares of Warrant Stock, all certificates representing shares shall bear
on the face thereof substantially the following legend:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN
ACQUIRED BY THE HOLDER FOR ITS OWN ACCOUNT, FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO THE DISTRIBUTION OF SUCH
SECURITIES. THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY
APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE SOLD OR
OTHERWISE TRANSFERRED EXCEPT (I) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT AND COMPLIANCE WITH SUCH
STATE SECURITIES LAWS, (II) IN COMPLIANCE WITH RULE 144 UNDER
THE ACT AND APPLICABLE STATE SECURITIES LAWS, OR (III) UPON
THE DELIVERY TO IA GLOBAL, INC. (THE "COMPANY") OF AN OPINION
OF COUNSEL OR OTHER EVIDENCE SATISFACTORY TO THE COMPANY THAT
SUCH REGISTRATION AND/ OR COMPLIANCE IS NOT REQUIRED.
8. NOTICES. All notices required hereunder shall be in writing and
shall be deemed given when telegraphed, delivered personally or within two days
after mailing when mailed by certified or registered mail, return receipt
requested, to the Company or the Holder, as the case may be, for whom such
notice is intended, if to the Holder, at the address of such party as set forth
in the Purchase Agreement, or if to the Company, IA Global, Inc. at ▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ or at such other address
of which the Company or the Holder has been advised by notice hereunder.
9. APPLICABLE LAW. The Warrant is issued under and shall for all
purposes be governed by and construed in accordance with the laws of the State
of California, without regard to the conflict of laws provisions of such State.
4
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed on
its behalf, in its corporate name, by its duly authorized officer, all as of the
day and year first above written.
IA GLOBAL, INC.
By: _______________
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Chief Executive Officer
5
APPENDIX A
WARRANT EXERCISE FORM
The undersigned hereby irrevocably elects to (i) exercise the within
Warrant to purchase __________ shares of the Common Stock of IA GLOBAL, INC., a
Delaware corporation, pursuant to the provisions of Section 1 of the attached
Warrant, and hereby makes payment of $__________ in payment therefore or a
cashless exercise at the sole decision of the Holder, or (ii) exercise this
Warrant for the purchase of __________ shares of Common Stock, pursuant to the
provisions of Section 2 of the attached Warrant. The undersigned's execution of
this form constitutes the undersigned's agreement to all the terms of the
Warrant and to comply therewith.
________________________________________
Signature
Print Name:_____________________________
________________________________________
Signature, if jointly held
Print Name:_____________________________
Date:___________________________________
6
APPENDIX B
ASSIGNMENT FORM
FOR VALUE RECEIVED_____________________________ ("Assignor") hereby
sells, assigns and transfers unto _______________________________ ("Assignee")
all of Assignor's right, title and interest in, to and under Warrant No. W-4
issued by IA Global, Inc., dated ______________.
DATED: _________________
ASSIGNOR:
________________________________________
Signature
Print Name:_____________________________
________________________________________
Signature, if jointly held
Print Name:_____________________________
ASSIGNEE:
The undersigned agrees to all of the terms of the Warrant and to comply
therewith.
________________________________________
Signature
Print Name:_____________________________
________________________________________
Signature, if jointly held
Print Name:_____________________________
7
