WARRANT TO PURCHASE SHARES OF COMMON STOCK OF URON INC. EXERCISABLE ON OR BEFORE, AND VOID AFTER
NEITHER
THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, OR ANY APPLICABLE STATE SECURITIES
LAWS. AS A RESULT, THIS WARRANT AND SUCH SECURITIES MAY NOT BE SOLD, OFFERED
FOR
SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR EVIDENCE SATISFACTORY TO THE COMPANY OF AN APPLICABLE EXEMPTION
FROM REGISTRATION UNDER THE ACT OR COMPLIANCE WITH RULE 144 UNDER SUCH ACT.
THE
TRANSFER OF THIS WARRANT IS FURTHER RESTRICTED AS PROVIDED
HEREIN.
WARRANT
TO PURCHASE SHARES
OF
COMMON STOCK
OF
URON INC.
EXERCISABLE
ON OR BEFORE, AND VOID AFTER
5:00
P.M.
MINNEAPOLIS TIME ON NOVEMBER 29, 2012
THIS
CERTIFIES
THATLantern
Advisors, LLC, a Minnesota limited liability company (the “Holder”),
or
registered assigns, is entitled to subscribe for and purchase from URON Inc.,
a
Minnesota corporation (the “Company”),
at
any time permitted hereunder after November 29, 2007, and through November
29,
2012 (subject to the terms and provisions of this Warrant), up to 400,000
shares
of the Company’s common stock at an exercise price of $0.01 per share, subject
to adjustment as provided herein (as adjusted, the “Purchase
Price”).
The
shares that may be acquired upon exercise of this Warrant are referred to herein
as the “Warrant
Shares.”
As
used herein, the term “Holder” means the Holder identified in the paragraph
above and any party who acquires all or a part of this Warrant as a registered
transferee of such
Holder.
The
term “Convertible
Securities”
means
any stock or other securities convertible into, or exchangeable for, Company
common stock. This
Warrant is subject to the following terms and conditions:
1. Exercise.
The
rights represented by this Warrant may be exercised by the Holder, in whole
or
in part (but not as to a fractional share of common stock), by written Notice
of
Exercise (in the form attached hereto) delivered to the Company at its principal
office prior to the expiration of this Warrant and accompanied or preceded
by
the surrender of this Warrant, along with a check in payment of the Purchase
Price multiplied
by the number of Warrant Shares being purchased hereunder (unless this Warrant
is being exercised pursuant to Section 9 below). The right to exercise this
Warrant shall vest only upon a change in control of the Company, which shall
be
deemed to occur upon any of the following: (a) an acquisition by one or more
individuals, entities or associations of effective control (whether through
legal or beneficial ownership of capital stock, by contract or otherwise) of
more than 33% of the voting securities of the Company, or (b) a merger or
consolidation of the Company or any of its affiliates (specifically including
but not limited to a subsidiary), with or into any other entity or association,
or the merger or consolidation of any other entity or association with or into
the Company or any of its affiliates (specifically including but not limited
to
a subsidiary). As used herein, the term “affiliates” shall have the meaning
ascribed to such term under the Securities Act of 1933.
2. Exchange
and Replacement.
Upon
receipt by the Company of evidence reasonably satisfactory to it of the loss,
theft, destruction, or mutilation of this Warrant, the Company will make and
deliver a new Warrant of like
tenor, in lieu of this Warrant. This Warrant shall be promptly canceled by
the
Company upon the surrender hereof in connection with any exchange or
replacement.
3. Issuance
of the Warrant Shares.
(a) Subject
to the provisions of paragraph (b) below, certificates for the Warrant Shares
purchased hereunder shall be delivered to the Holder within a reasonable time,
not exceeding five business days, after the rights represented by this Warrant
shall have been exercised in accordance with the requirements hereof, and,
unless this Warrant has expired,
a new Warrant representing the right to purchase the number of
Warrant Shares,
if any, with respect to which this Warrant shall not then have been exercised
shall also be delivered to the Holder within such time.
(b) Notwithstanding
the foregoing, the Company shall not
be
required to recognize any exercise, or deliver any certificate for Warrant
Shares upon attempted exercise, of this Warrant except in accordance with
exemptions from the applicable securities, registration requirements or
registrations under applicable securities laws. The Company shall not be
obligated to effect a registration of the Warrant Shares under federal or state
securities laws unless specifically so provided herein. The Holder agrees to
execute such documents and make such representations, warranties and agreements
as may be required solely to comply with the exemptions relied upon by the
Company, or the registrations made, for the issuance of the Warrant Shares
or
their later resale pursuant to a registration statement filed by the
Company.
4. Covenants
of the Company.
The
Company 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 for the purpose of issue or transfer upon exercise of the
subscription rights evidenced by this Warrant a sufficient number of shares
of
common stock to provide for the exercise of the rights represented by this
Warrant.
5. Purchase
Price and Warrant Share Adjustments. The
provisions of this Warrant are subject to adjustment as provided in this Section
5.
(a) Subject
to paragraph (c) below, in case the Company shall hereafter: (i) pay any
dividends on any class of stock of the Company payable in common stock or
Convertible Securities; (ii) subdivide its then-outstanding shares of common
stock into a greater number of shares; or (iii) combine outstanding shares
of
common stock, by reclassification or otherwise; then,
in
any such event, the Purchase Price in effect immediately prior to such event
shall (until adjusted again pursuant hereto) be adjusted immediately after
such
event to a price (calculated to the nearest full cent) determined by dividing
(A) the number of shares of common stock
outstanding
immediately prior to such event, multiplied by the then-existing Purchase Price,
by (B) the total number of shares of common stock outstanding immediately after
such event (including in each case the maximum number of shares of common stock
issuable in respect of any Convertible Securities), and the resulting quotient
shall be the adjusted Purchase Price. An adjustment made pursuant to this
paragraph shall
become
effective immediately after the record date in the case of a dividend or
distribution and shall become effective immediately after the effective date
in
the case of a subdivision, combination or reclassification. If, as a result
of
an adjustment made pursuant to this paragraph, the Holder of any Warrant
thereafter surrendered for exercise shall become entitled to receive shares
of
two or more classes of capital stock of the Company, the Company’s board of
directors (whose determination shall be conclusive) shall determine the
allocation of the adjusted Purchase Price between or among shares of such
classes of capital stock or shares of common stock and other-capital
stock. All calculations under this paragraph shall be made to the nearest cent
or to the nearest 1/100 of a share, as
the
case
may be. In the event that at any time as a result of an adjustment made pursuant
to this paragraph, the holder of any Warrant thereafter surrendered for exercise
shall become entitled to receive any shares of the Company other than shares
of
common stock, thereafter the Purchase Price of such other shares so receivable
upon exercise of any Warrant shall be subject to adjustment from
time to
time
in a manner and on terms as nearly equivalent as practicable to the provisions
with respect to common stock contained in this Section.
2
(b) In
case
of any consolidation or merger to which the Company is a party other than a
merger or consolidation in which the Company is the surviving corporation,
or in
case of any sale or conveyance to another corporation of the property of the
Company as an entirety or substantially as an entirety, or in the case of any
statutory exchange of securities with another corporation (including any
exchange effected in connection with a merger of a third corporation into the
Company), there shall be no adjustment under paragraph (a) above but the Holder
of this Warrant then outstanding shall have the right thereafter to convert
this
Warrant into the kind and amount of shares of stock and other
securities, and
any
other property, which he, she or it would have owned or have been entitled
to
receive immediately after such consolidation, merger, statutory exchange sale
or
conveyance had such Warrant been converted immediately prior to the effective
date of such consolidation, merger, statutory exchange, sale or conveyance.
The
provisions of this paragraph shall similarly apply to successive consolidations,
mergers, statutory exchanges, sales or conveyances.
(c) Notwithstanding
the provisions of paragraph (a) above, no adjustment to the number of Warrant
Shares purchasable hereunder or the Purchase Price shall be made in connection
with any stock combination (i.e., reverse stock split) effected in connection
with any merger transaction (or associated agreements) involving Checkmate
Consumer Lending Corporation, a Delaware corporation, or Wyoming Financial
Lenders, Inc., a Wyoming corporation.
6. No
Voting Rights.
This
Warrant by itself shall not entitle the Holder to any voting rights or other
rights as a stockholder of the Company.
7. Notice
of Transfer of Warrant or Resale of the Warrant Shares.
(a) By
acceptance hereof, the Holder agrees to give written notice to the Company
before transferring this Warrant or transferring any Warrant Shares of such
Holder’s intention to do so, describing briefly the manner of any proposed
transfer. If in the opinion of counsel to the Company the proposed transfer
may
be effected without registration or qualification (under any federal and state
securities laws), the Company, as promptly as practicable, shall notify the
Holder of such opinion, whereupon the Holder shall be entitled to transfer
this
Warrant or to dispose of Warrant Shares received upon the previous exercise
of
this Warrant, all in accordance with the
terms
of the notice delivered by the Holder to the Company; provided, however, that
an
appropriate legend may be endorsed on this Warrant or the certificates for
such
Warrant Shares respecting restrictions upon transfer thereof necessary or
advisable in the opinion of counsel and satisfactory to the Company to prevent
further transfers which would be in violation of Section 5 of the Securities
Act
of 1933 (the “Securities
Act”)
and
applicable state securities laws; and provided further that the prospective
transferee or purchaser shall execute such documents and make such
representations, warranties, and agreements as may be required solely
to.
comply
with the exemptions relied upon by the Company for the transfer of disposition
of the Warrant or Warrant Shares.
3
(b) If,
in
the opinion of counsel referred to in this Section 7, the proposed transfer
or
disposition of this Warrant or such Warrant Shares described in the written
notice given pursuant to this Section 7 may
not
be
effected without registration or qualification of this Warrant or such Warrant
Shares the Company shall promptly give written notice thereof to the Holder,
and
the Holder will limit its activities in
respect
to such transfer or disposition as, in the opinion of both such counsel, are
permitted by law.
8. No
Fractional Shares.
No
fractional shares will be issued upon the exercise hereof.
9. Net
Issue Exercise.
In lieu
of exercising this Warrant pursuant to Section 1 hereof, the Holder may elect
to
receive, without the payment of any additional consideration, a number of
Warrant Shares equal to the value (as determined below) of this Warrant (or
the
portion thereof being exercised) by surrender of this Warrant to the Company
together with a duly executed Notice of Exercise (in the form attached hereto)
in which the appropriate alternative is initialed by the Holder. In such event,
the Company shall issue to the Holder the number of Warrant Shares computed
by
applying the following formula:
X
= Y
(A-B)
A
Where:
X
|
= | the number of Warrant Shares to be issued to the Holder; | ||
Y
|
= | the number of Warrant Shares subject to this warrant (or, if only a portion of this Warrant is being exercised, the number of Warrant Shares subject to the portion of this Warrant being exercised); | ||
|
||||
A
|
= | the Fair Market Value of one Warrant Share (at the date of such exercise); and | ||
B
|
= | the Purchase Price, as adjusted to the date of such calculation. |
For
purposes of the above, the “Fair
Market Value”
of
one
share shall equal the average of the closing sale prices of the common stock
quoted on a Nasdaq Stock Market, the AMEX, or NYSE (collectively, a
“Stock
Exchange”),
or
listed in the Over-The-Counter Bulletin Board (or the Pink Sheets) or the
closing price quoted on any national securities exchange on which such
securities are listed, whichever is applicable, for the ten consecutive trading
days immediately prior to the date of determination of Fair Market Value (or,
if
no sales take place on any such trading day, the average of the closing bid
and
asked prices on such trading day). If, however, the common stock is not traded
on a Stock Exchange or the Over-The-Counter Bulletin Board or Pink Sheets,
the
Fair Market Value of a Warrant Share shall be determined in good faith by the
Company’s board of directors.
10. Registration
Rights.
(a) Subject
to paragraph (d) of this Section, each time the Company shall determine to
proceed with the actual preparation and filing of a registration statement
under
the Securities Act, in connection with the proposed offer and sale for money
of
any of its securities by it (other than a registration on Form X-0, X-0 or
any
successor forms or other inappropriate forms), the Company will give written
notice of its determination to Holder. Upon the written request of Holder given
within 30 days after receipt of any such notice from the Company, the Company
will, except as herein provided, cause all Warrant Shares with respect to which
Holder has requested registration to be included in such registration statement,
all to the extent requisite to permit the sale or other disposition by Holder
of
the shares to be so registered; provided, however, that nothing herein shall
prevent the Company from, at any time, abandoning or delaying any such
registration initiated by it. If any such registration pertains to an
underwritten offering in whole or in part, the Company may require that the
shares requested for inclusion by Holder pursuant to this section be included
in
the underwritten offering on the same terms and conditions as the securities
otherwise being sold through the underwriters. If, in the good faith judgment
of
the managing underwriter of such underwritten offering, the inclusion of all
of
the Warrant Shares originally covered by a request for registration made by
Holder would reduce the amount of securities to be offered by the Company or
interfere with the successful marketing of the securities to be offered by
the
Company, the number of Warrant Shares owned by or issuable to Holder and
otherwise to be included in the underwritten offering may be reduced. Any
Warrant Shares which are thus excluded from the underwritten offering shall
be
withheld from the market by Holder for a period, not to exceed 180 days, that
the managing underwriter reasonably determines is necessary in order to effect
the underwritten offering.
4
(b) If
and
whenever the Company is required by the provisions of Section 10(a) to effect
the registration of any Warrant Shares under the Securities Act, the Company
will:
(i) prepare
and file with the SEC a registration statement with respect to such shares,
and
use reasonable commercial efforts to cause such registration statement to become
and remain effective for such period as may be reasonably necessary to effect
the sale of such shares, not to exceed two years from the date of issuance
of
the covered Warrant Shares;
(ii) prepare
and file with the SEC such amendments to such registration statement and
supplements to the prospectus contained therein as may be necessary to keep
such
registration statement effective for such period as may be reasonably necessary
to effect the sale of such securities, not to exceed two years from the date
of
issuance of the covered Warrant Shares;
(iii) furnish
to Holder and to the underwriters of the securities being registered such
reasonable number of copies of the registration statement, preliminary
prospectus, final prospectus and such other documents as Holder and underwriters
may reasonably request in order to facilitate the public offering of such
securities;
(iv) use
reasonable commercial efforts to register or qualify the securities covered
by
such registration statement under such state securities or blue sky laws of
such
jurisdictions as the underwriters may reasonably request within 20 days
following the original filing of such registration statement, except that the
Company shall not for any purpose be required to execute a general consent
to
service of process or to qualify to do business as a foreign corporation in
any
jurisdiction wherein it is not so qualified; and
(v) prepare
and promptly file with the SEC any amendment or supplement to such registration
statement or prospectus as may be necessary to correct any statements or
omissions if, at the time when a prospectus relating to such securities is
required to be delivered under the Securities Act, any event shall have occurred
as the result of which any such prospectus or any other prospectus as then
in
effect would include an untrue statement of a material fact or omit to state
any
material fact necessary to make the statements therein, in the light of the
circumstances in which they were made, not misleading.
5
(c) With
respect to any registration of shares pursuant to Section 10(a), the Company
shall bear the following fees, costs and expenses: all registration, filing
and
NASD fees, printing expenses, fees and disbursements of counsel and accountants
for the Company, fees and disbursements of counsel for the underwriter or
underwriters of such securities (if the Company and/or selling security holders
are required to bear such fees and disbursements), all internal Company
expenses, the premiums and other costs of policies of insurance against
liability arising out of the public offering, and all legal fees and
disbursements and other expenses of complying with state securities or blue
sky
laws of any jurisdictions in which the securities to be offered are to be
registered or qualified. Fees and disbursements of counsel and accountants
for
Holder, underwriting discounts and commissions and transfer taxes for Holder
and
any other expenses incurred by Holder not expressly included above shall be
borne by Holder.
(d) Notwithstanding
anything to the contrary herein, the Company shall not be obligated to register
the resale of (i) any Warrant Shares purchased for cash which have been
outstanding for more than two years or (ii) any Warrant Shares, purchased
pursuant to Section 9, after November 29, 2010.
IN
WITNESS
WHEREOF,
the Company has caused this Warrant to be signed by its duly authorized
officer.
URON INC.: | |||
By:
|
/s/ Xxxxxxxxxxx Xxxxxx | ||
Xxxxxxxxxxx Xxxxxx Chief
Executive Officer
|
6
NOTICE
OF EXERCISE
(To
be
signed upon exercise of Warrant)
The
Undersigned,
the
holder of the within Warrant, hereby irrevocably elects to exercise the purchase
right represented by such Warrant for, and to purchase thereunder, of the shares
of common stock of URON Inc. to which such Warrant relates and herewith makes
payment of $______________________ therefor in cash or by certified check
(unless the Warrant is being exercised pursuant to Section 9, in which case
the
box below indicating such fact is checked), and requests that the certificate
for such shares be issued in the name of, and be delivered to, ________________
the
address for which is set forth below the signature of the
undersigned.
|
The
undersigned is exercising the Warrant pursuant to the Net Issue Exercise
provisions of Section 9.
|
Dated:
_______________________, 20____
________________________________________________________
Signature
________________________________________________________
Name
________________________________________________________
Address
________________________________________________________
City,
State, Zip Code
________________________________________________________
Social
Security or Tax Identification No.
7
ASSIGNMENT
FORM
(To
be
signed only upon authorized transfer of Warrant)
For
Value
Received,
the
undersigned hereby sells, assigns, and transfers unto
_______________________________ the right to purchase the securities of URON
Inc., a Minnesota corporation, to which the within Warrant relates and appoints
______________________, attorney, to transfer said right on the books of URON
Inc. with full power of substitution in the premises.
Dated:
_______________________, 20____
________________________________________________________
Signature
________________________________________________________
Name
________________________________________________________
Address
________________________________________________________
City,
State, Zip Code
________________________________________________________
Social
Security or Tax Identification No.