Exhibit 10.20
CONSULTING AGREEMENT
This Consulting Agreement (the "Agreement") is made as of __________,
---------
2002 by and between, Alpha Virtual, Inc., a Delaware company, having its
business address at 00000 Xxxx Xxxxxxx Xxxxxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx 9064
(the "Company") and Manhattan Capital Partners, LLC, having its principal place
-------
of business at _________________ (the "Consultant") .
----------
In consideration of the mutual promises contained herein and on the
terms and conditions hereinafter set forth, the Company and Consultant agree as
follows:
1. Provision of Services. Consultant agrees to place at the disposal
---------------------
of the Company its judgment and experience and to provide to the extent
reasonably requested by the President of the Company and as agreed to by
Consultant in its sole discretion, financial and business development consulting
services to the Company. These services include introducing the Company to
strategic partners to further corporate objectives and advice with regard to
stockholders relations and public relations matters.
2. Compensation. In consideration for services to be rendered under
------------
this Agreement, the Company and Consultant hereby agree that the Company shall
issue Consultant five (5) year warrants to purchase an aggregate of 2,000,000
shares of the Common Stock of the Company at a per share exercise price of
$____, such warrants to be in the form attached hereto as Exhibit "A".
3. Liability of Consultant. Consultant may rely upon information
-------------------------
furnished to it by the Company and that except as herein provided, Consultant
shall not be accountable for any loss suffered by the Company on the basis of
any advice recommendation or approval of Consultant, its partners, employees or
agents.
4. Status of Consultant. Consultant shall be deemed to be an
----------------------
independent contractor and, except as expressly provided or authorized in this
Agreement, shall have no authority to act for or represent the Company.
5. Other Activities of Consultant. The Company recognizes that
---------------------------------
Consultant now renders and may continue to render financial and other services
to other companies, which may or may not have policies and conduct activities
similar to those of the Company. Consultant shall be free to render such advice
and other services and the Company hereby consents thereto. Consultant shall not
be required to devote its full time and attention to the performance of its
duties under this Agreement, but shall devote only so much of its time and
attention as it deems reasonable or necessary for such purposes.
10.20-1
6. Term. Consultant's retention hereunder shall be for a term of [one
----
year] commencing upon the execution of this Agreement.
7. Miscellaneous. This Agreement sets forth the entire agreement and
-------------
understanding between the parties and supersedes all prior discussions,
agreements and understandings of every kind and any nature between them. This
Agreement shall be construed and interpreted according to the laws of the State
of California.
10.20-2
IN WITNESS WHEREOF, the parties have caused this Agreement to be signed
by their respective officers or representatives duly authorized the day and year
first above written.
ALPHA VIRTUAL, INC.
By:
-----------------------------------
Name:
Title:
MANHATTAN CAPITAL PARTNERS, LLC
By:
-----------------------------------
Name: Xxxx Xxxxxx
Title: Managing Director
10.20-3
EXHIBIT "A"
-----------
FORM OF WARRANT
Warrant
-------
THE WARRANT EVIDENCED OR CONSTITUTED HEREBY, AND ALL SHARES OF COMMON STOCK
ISSUABLE HEREUNDER, HAVE BEEN AND WILL BE ISSUED WITHOUT REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED ("THE ACT") AND MAY NOT BE SOLD, OFFERED FOR
SALE, TRANSFERRED, PLEDGED OR HYPOTHECATED WITHOUT REGISTRATION UNDER THE ACT
UNLESS EITHER (A) THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL, IN FORM AND
SUBSTANCE REASONABLY SATISFACTORY TO THE COMPANY, TO THE EFFECT THAT
REGISTRATION IS NOT REQUIRED IN CONNECTION WITH SUCH DISPOSITION OR (B) THE SALE
OF SUCH SECURITIES IS MADE PURSUANT TO SECURITIES AND EXCHANGE COMMISSION RULE
144.
WARRANT TO PURCHASE COMMON STOCK
OF
ALPHA VIRTUAL, INC.
(Subject to Adjustment)
NO. __
This Certifies That, for value received, Manhattan Capital Partners
LLC, a California limited liability company ("Holder"), is entitled, subject to
------
the terms and conditions of this Warrant, at any time or from time to time after
December __, 2002 (the "Effective Date"), to purchase from Alpha Virtual , Inc.,
--------------
a Delaware corporation (the "Company"), up to Two Million (2,000,000) shares of
-------
common stock of the Company at a price per share of $______ (the "Purchase
--------
Price"). This Warrant shall expire at 5:00 p.m. Pacific time on the fifth
-----
anniversary of the Effective Date of this Warrant (the "Expiration Date"). Both
---------------
the number of shares of Common Stock purchasable upon exercise of this Warrant
and the Purchase Price are subject to adjustment and change as provided herein.
This Warrant is issued pursuant to that certain Financial Consulting Agreement
of even date hereof between the Company and the Holder.
1. CERTAIN DEFINITIONS. As used in this Warrant the following terms shall
have the following respective meanings:
"1933 Act" shall mean the Securities Act of 1933, as amended.
--------
"Common Stock" shall mean the Common Stock of the Company and any other
------------
securities at any time receivable or issuable upon exercise of this Warrant.
10.20-4
"Fair Market Value" of a share of Common Stock as of a particular date
-----------------
shall mean:
(a) If traded on a securities exchange or the Nasdaq National
Market, the Fair Market Value shall be deemed to be the average of the closing
prices of the Common Stock of the Company on such exchange or market over the 5
business days ending immediately prior to the applicable date of valuation;
(b) If actively traded over-the-counter, the Fair Market Value
shall be deemed to be the average of the closing bid prices over the 30-day
period ending immediately prior to the applicable date of valuation; and
(c) If there is no active public market, the Fair Market Value
shall be the value as determined in good faith by the Company's Board of
Directors upon a review of relevant factors, including due consideration of the
Registered Holders' determination of the value of the Company.
"Registered Holder" shall mean any person in whose name this Warrant is
-----------------
registered upon the books and records maintained by the Company.
"SEC" shall mean the Securities and Exchange Commission.
---
2. EXERCISE OF WARRANT
2.1. Payment. Subject to compliance with the terms and conditions of
-------
this Warrant and applicable securities laws, this Warrant may be exercised, in
whole or in part at any time or from time to time, on or before the Expiration
Date by the delivery (including, without limitation, delivery by facsimile) of
the form of Notice of Exercise attached hereto as Exhibit 1 (the "Notice of
---------
Exercise"), duly executed by the Registered Holder, at the principal office of
--------
the Company, and as soon as practicable after such date, surrendering
(a) this Warrant at the principal office of the Company, and
(b) payment, (i) in cash (by check) or by wire transfer, (ii)
by cancellation by the Registered Holder of indebtedness of the Company to the
Registered Holder; or (iii) by a combination of (i) and (ii), of an amount equal
to the product obtained by multiplying the number of shares of Common Stock
being purchased upon such exercise by the then effective Purchase Price (the
"Exercise Amount").
----------------
2.2. Net Issue Exercise. In lieu of the payment methods set forth in
------------------
Section 2.1(b) above, the Registered Holder may elect to exchange all or some of
the Warrant for shares of Common Stock equal to the value of the amount of the
Warrant being exchanged on the date of exchange. If the Registered Holder elects
to exchange this Warrant as provided in this Section 2.2, the Registered Holder
shall tender to the Company the Warrant for the amount being exchanged, along
with written notice of the Registered Holder's election to exchange some or all
of the Warrant, and the Company shall issue to the Registered Holder the number
of shares of the Common Stock computed using the following formula:
10.20-5
X = Y (A-B)
-------
A
Where X = the number of shares of Common Stock to be issued to the
Registered Holder.
Y = the number of shares of Common Stock purchasable under the amount
of the Warrant being exchanged (as adjusted to the date of such
calculation).
A = the Fair Market Value of one share of the Company's Common Stock.
B = Purchase Price of one share of the Company's Common Stock (as
adjusted to the date of such calculation).
All references herein to an "exercise" of the Warrant shall
include an exchange pursuant to this Section 2.2.
2.3. "Easy Sale" Exercise. In lieu of the payment methods set forth in
-------------------
Section 2.1(b) above, when permitted by law and applicable regulations
(including Nasdaq and NASD rules), the Registered Holder may pay the Purchase
Price through a "same day sale" commitment from the Registered Holder (and if
applicable a broker-dealer that is a member of the National Association of
Securities Dealers (a "NASD Dealer")), whereby the Registered Holder irrevocably
-----------
elects to exercise this Warran and to sell a portion of the shares of Common
Stock so purchased to pay the applicable Purchase Price and the Registered
Holder (or, if applicable, the NASD Dealer) commits upon sale (or, in the case
of the NASD Dealer, upon receipt) of such shares of Common Stock to forward the
Purchase Price directly to the Company.
2.4. Stock Certificates; Fractional Shares. As soon as practicable on
--------------------------------------
or after the date of an exercise of this Warrant, the Company shall issue and
deliver to the person or persons entitled to receive the same a certificate or
certificates for the number of whole shares of Common Stock issuable upon such
exercise, together with cash in lieu of any fraction of a share equal to such
fraction of the current Fair Market Value of one whole share of Common Stock as
of the date of exercise of this Warrant. No fractional shares or scrip
representing fractional shares shall be issued upon an exercise of this Warrant.
2.5 Partial Exercise; Effective Date of Exercise. In case of any
------------------------------------------------
partial exercise of this Warrant, the Company shall cancel this Warrant upon
surrender hereof and shall execute and deliver a new Warrant of like tenor and
date for the balance of the shares of Common Stock purchasable hereunder. This
Warrant shall be deemed to have been exercised immediately prior to the close of
business on the date of its surrender for exercise as provided above. The person
entitled to receive the shares of Common Stock issuable upon exercise of this
Warrant shall be treated for all purposes as the holder of record of such shares
as of the close of business on the date the Registered Holder is deemed to have
exercised this Warrant.
10.20-6
3. VALID ISSUANCE: TAXES. All shares of Common Stock issued upon the
exercise of this Warrant shall be validly issued, fully paid and non-assessable,
and the Company shall pay all taxes and other governmental charges that may be
imposed in respect of the issue or delivery thereof. The Company shall not be
required to pay any tax or other charge imposed in connection with any transfer
involved in the issuance of any certificate for shares of Common Stock in any
name other than that of the Registered Holder of this Warrant, and in such case
the Company shall not be required to issue or deliver any stock certificate or
security until such tax or other charge has been paid, or it has been
established to the Company's reasonable satisfaction that no tax or other charge
is due.
4. ADJUSTMENT OF PURCHASE PRICE AND NUMBER OF SHARES. The number of shares
of Common Stock issuable upon exercise of this Warrant (or any shares of stock
or other securities or property receivable or issuable upon exercise of this
Warrant) and the Purchase Price are subject to adjustment upon occurrence of the
following events:
4.1. Adjustment for Stock Splits,Stock Subdivisions or Combinations of
-----------------------------------------------------------------
Shares. The Purchase Price of this Warrant shall be proportionally decreased and
------
the number of shares of Common Stock issuable upon exercise of this Warrant (or
any shares of stock or other securities at the time issuable upon exercise of
this Warrant) shall be proportionally increased to reflect any stock split or
subdivision of the Company's Common Stock. The Purchase Price of this Warrant
shall be proportionally increased and the number of shares of Common Stock
issuable upon exercise of this Warrant (or any shares of stock or other
securities at the time issuable upon exercise of this Warrant) shall be
proportionally decreased to reflect any combination of the Company's Common
Stock.
4.2. Adjustment for Dividends or Distributions of Stock or Other
-----------------------------------------------------------
Securities or Property. In case the Company shall make or issue, or shall fix a
----------------------
record date for the determination of eligible holders entitled to receive, a
dividend or other distribution with respect to the Common Stock (or any shares
of stock or other securities at the time issuable upon exercise of the Warrant)
payable in (a) securities of the Company or (b) assets (excluding cash dividends
paid or payable solely out of retained earnings), then, in each such case, the
Registered Holder of this Warrant on exercise hereof at any time after the
consummation, effective date or record date of such dividend or other
distribution, shall receive, in addition to the shares of Common Stock (or such
other stock or securities) issuable on such exercise prior to such date, and
without the payment of additional consideration therefor, the securities or such
other assets of the Company to which such Registered Holder would have been
entitled upon such date if such Registered Holder had exercised this Warrant on
the date hereof and had thereafter, during the period from the date hereof to
and including the date of such exercise, retained such shares and/or all other
additional stock available by it as aforesaid during such period giving effect
to all adjustments called for by this Section 4.
10.20-7
4.3. Reclassification. If the Company, by reclassification of
----------------
securities or otherwise, shall change any of the securities as to which purchase
rights under this Warrant exist into the same or a different number of
securities of any other class or classes, this Warrant shall thereafter
represent the right to acquire such number and kind of securities as would have
been issuable as the result of such change with respect to the securities that
were subject to the purchase rights under this Warrant immediately prior to such
reclassification or other change and the Purchase Price therefore shall be
appropriately adjusted, all subject to further adjustment as provided in this
Section 4. No adjustment shall be made pursuant to this Section 4.3 upon any
conversion or redemption of the Common Stock which is the subject of Section
4.5.
4.4. Adjustment for Capital Reorganization, Merger or Consolidation.
--------------------------------------------------------------
In case of any capital reorganization of the capital stock of the Company (other
than a combination, reclassification, exchange or subdivision of shares
otherwise provided for herein), or any merger or consolidation of the Company
with or into another corporation, or the sale of all or substantially all the
assets of the Company then, and in each such case, as a part of such
reorganization, merger, consolidation, sale or transfer, lawful provision shall
be made so that the Registered Holder of this Warrant shall thereafter be
entitled to receive upon exercise of this Warrant, during the period specified
herein and upon payment of the Purchase Price then in effect, the number of
shares of stock or other securities or property of the successor corporation
resulting from such reorganization, merger, consolidation, sale or transfer that
a holder of the shares deliverable upon exercise of this Warrant would have been
entitled to receive in such reorganization, consolidation, merger, sale or
transfer if this Warrant had been exercised immediately before such
reorganization, merger, consolidation, sale or transfer, all subject to further
adjustment as provided in this Section 4. The foregoing provisions of this
Section 4.4 shall similarly apply to successive reorganizations, consolidations,
mergers, sales and transfers and to the stock or securities of any other
corporation that are at the time receivable upon the exercise of this Warrant.
If the per-share consideration payable to the Registered Holder hereof for
shares in connection with any such transaction is in a form other than cash or
marketable securities, then the value of such consideration shall be determined
in good faith by the Company's Board of Directors. In all events, appropriate
adjustment (as determined in good faith by the Company's Board of Directors)
shall be made in the application of the provisions of this Warrant with respect
to the rights and interests of the Registered Holder after the transaction, to
the end that the provisions of this Warrant shall be applicable after that
event, as near as reasonably may be, in relation to any shares or other property
deliverable after that event upon exercise of this Warrant.
4.5. Conversion of Common Stock. In case all or any portion of the
--------------------------
authorized and outstanding shares of Common Stock of the Company are redeemed or
converted or reclassified into other securities or property pursuant to the
Company's Certificate of Incorporation or otherwise, or the Common Stock
otherwise ceases to exist, then, in such case, the Registered Holder of this
Warrant, upon exercise hereof at any time after the date on which the Common
Stock is so redeemed or converted, reclassified or ceases to exist (the
10.20-8
"Termination Date"), shall receive, in lieu of the number of shares of Common
----------------
Stock that would have been issuable upon such exercise immediately prior to the
Termination Date, the securities or property that would have been received if
this Warrant had been exercised in full and the Common Stock received thereupon
had been simultaneously converted immediately prior to the Termination Date, all
subject to further adjustment as provided in this Warrant. Additionally, the
Purchase Price shall be immediately adjusted to equal the quotient obtained by
dividing (x) the aggregate Purchase Price of the maximum number of shares of
Common Stock for which this Warrant was exercisable immediately prior to the
Termination Date by (y) the number of shares of Common Stock of the Company for
which this Warrant is exercisable immediately after the Termination Date, all
subject to further adjustment as provided herein.
5. CERTIFICATE AS TO ADJUSTMENTS. In each case of any adjustment in the
Purchase Price, or number or type of shares issuable upon exercise of this
Warrant, the Chief Financial Officer or Controller of the Company shall compute
such adjustment in accordance with the terms of this Warrant and prepare a
certificate setting forth such adjustment and showing in detail the facts upon
which such adjustment is based, including a statement of the adjusted Purchase
Price. The Company shall promptly send (by facsimile and by either first class
mail, postage prepaid or overnight delivery) a copy of each such certificate to
the Registered Holder.
6. LOSS OR MUTILATION. Upon receipt of evidence reasonably satisfactory to
the Company of the ownership of and the loss, theft, destruction or mutilation
of this Warrant, and of indemnity reasonably satisfactory to it, and (in the
case of mutilation) upon surrender and cancellation of this Warrant, the Company
will execute and deliver in lieu thereof a new Warrant of like tenor as the
lost, stolen, destroyed or mutilated Warrant.
7. RESERVATION OF COMMON STOCK. The Company hereby covenants that at all
times there shall be reserved for issuance and delivery upon exercise of this
Warrant such number of shares of Common Stock or other shares of capital stock
of the Company as are from time to time issuable upon exercise of this Warrant
and, from time to time, will take all steps necessary to amend its Certificate
of Incorporation to provide sufficient reserves of shares of Common Stock or
other shares of capital stock issuable upon exercise of this Warrant (and shares
of its Common Stock for issuance on conversion of such capital stock). All such
shares shall be duly authorized, and when issued upon such exercise, shall be
validly issued, fully paid and non-assessable, free and clear of all liens,
security interests, charges and other encumbrances or restrictions on sale and
free and clear of all preemptive rights, except encumbrances or restrictions
arising under federal or state securities laws. Issuance of this Warrant shall
constitute full authority to the Company's officers who are charged with the
duty of executing stock certificates to execute and issue the necessary
certificates for shares of Common Stock and other capital stock upon the
exercise of this Warrant.
8. TRANSFER AND EXCHANGE. Subject to compliance with all applicable
securities laws, this Warrant and all rights hereunder may be transferred by the
Registered Holder to any person, in whole or in part, on the books of the
Company maintained for such purpose at the principal office of the Company
referred to above, by the Registered Holder hereof in person, or by duly
authorized attorney, upon surrender of this Warrant properly endorsed and upon
10.20-9
payment of any necessary transfer tax or other governmental charge imposed upon
such transfer. Upon any partial transfer, the Company will issue and deliver to
the Registered Holder a new Warrant or Warrants with respect to the portion of
this Warrant not so transferred. Each taker and holder of this Warrant, by
taking or holding the same, consents and agrees that when this Warrant shall
have been so endorsed, the person in possession of this Warrant may be treated
by the Company, and all other persons dealing with this Warrant, as the absolute
owner hereof for any purpose and as the person entitled to exercise the rights
represented hereby, any notice to the contrary notwithstanding; provided,
however that until a transfer of this Warrant is duly registered on the books of
the Company, the Company may treat the Registered Holder hereof as the owner for
all purposes.
9. RESTRICTIONS ON TRANSFER. The Registered Holder, by acceptance hereof,
agrees that, absent an effective registration statement filed with the SEC under
the 1933 Act, covering the disposition or sale of this Warrant or the Common
Stock issued or issuable upon exercise hereof or the Common Stock issuable upon
conversion thereof, as the case may be, and registration or qualification under
applicable state securities laws, such Registered Holder will not sell,
transfer, pledge, or hypothecate any or all such Warrants or Common Stock, as
the case may be, unless either (i) the Company has received an opinion of
counsel, in form and substance reasonably satisfactory to the Company, to the
effect that such registration is not required in connection with such
disposition, or (ii) the sale of such securities is made pursuant to SEC Rule
144.
10. COMPLIANCE WITH SECURITIES LAWS. By acceptance of this Warrant, the
Registered Holder hereby represents, warrants and covenants that any shares of
stock purchased upon exercise of this Warrant or acquired upon conversion
thereof shall be acquired for investment only and not with a view to, or for
sale in connection with, any distribution thereof; that the Registered Holder
has had such opportunity as such Registered Holder has deemed adequate to obtain
from representatives of the Company such information as is necessary to permit
the Registered Holder to evaluate the merits and risks of its investment in the
Company; that the Registered Holder is able to bear the economic risk of holding
such shares as may be acquired pursuant to the exercise of this Warrant for an
indefinite period; that the Registered Holder understands that the shares of
stock acquired pursuant to the exercise of this Warrant or acquired upon
conversion thereof will not be registered under the 1933 Act (unless otherwise
required pursuant to exercise by the Registered Holder of the registration
rights, if any, previously granted to the Registered Holder) and will be
"restricted securities" within the meaning of Rule 144 under the 1933 Act and
that the exemption from registration under Rule 144 will not be available for at
least one year from the date of exercise of this Warrant, subject to any special
treatment by the SEC for exercise of this Warrant pursuant to Section 2.2, and
even then will not be available unless a public market then exists for the
stock, adequate information concerning the Company is then available to the
public, and other terms and conditions of Rule 144 are complied with; and that
all stock certificates representing shares of stock issued to the Registered
Holder upon exercise of this Warrant or upon conversion of such shares may have
affixed thereto a legend substantially in the following form:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR
UNDER THE SECURITIES LAWS OF ANY STATE. THESE SECURITIES ARE
10.20-10
SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY
NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE
ACT AND ANY APPLICABLE STATE SECURITIES LAWS, PURSUANT TO
REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE
AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS
OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE
ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL
IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER TO THE
EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE
WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.
11. NO RIGHTS OR LIABILITIES AS STOCKHOLDERS. This Warrant shall not
entitle the Registered Holder to any voting rights or other rights as a
stockholder of the Company. In the absence of affirmative action by such
Registered Holder to purchase Common Stock by exercise of this Warrant, no
provisions of this Warrant, and no enumeration herein of the rights or
privileges of the Registered Holder hereof shall cause such Registered Holder
hereof to be a stockholder of the Company for any purpose.
12. NOTICES. All notices and other communications required or permitted
hereunder shall be in writing and shall be mailed by registered or certified
mail, postage prepaid, return receipt requested, or by telecopier, or by email
or otherwise delivered by hand or by messenger, addressed or telecopied to the
person to whom such notice or communication is being given at its address set
forth after its signature hereto. In order to be effective, a copy of any notice
or communication sent by telecopier or email must be sent by registered or
certified mail, postage prepaid, return receipt requested, or delivered
personally to the person to whom such notice or communication is being at its
address set forth after its signature hereto. If notice is provided by mail,
notice shall be deemed to be given five (5) business days after proper deposit
with the United States mail or nationally recognized overnight courier, or
immediately upon personally delivery thereof, to person to whom such notice or
communication is being at such address. If notice is provided by telecopier,
notice shall be deemed to be given upon confirmation by the telecopier machine
of the receipt of such notice at the telecopier number provided above. If notice
is provided by email, notice shall be deemed to be given upon confirmation by
the sender's email program of the receipt of such notice at the email address
provided after the signature of the person to whom such notice or communication
is being. The addresses set forth after the signatures hereto may be changed by
written notice complying with the terms of this Section 12.
13 HEADINGS. The headings in this Warrant are for purposes of convenience
in reference only, and shall not be deemed to constitute a part hereof.
14. LAW GOVERNING. This Warrant shall be construed and enforced in
accordance with, and governed by, the laws of the State of California.
15. NOTICES OF RECORD DATE. In case:
15.1. the Company shall take a record of the holders of its Common
Stock (or other stock or securities at the time receivable upon the exercise of
this Warrant), for the purpose of entitling them to receive any dividend or
other distribution, or any right to subscribe for or purchase any shares of
stock of any class or any other securities or to receive any other right; or
10.20-11
15.2. of any consolidation or merger of the Company with or into
another corporation, any capital reorganization of the Company, any
reclassification of the capital stock of the Company, or any conveyance of all
or substantially all of the assets of the Company to another corporation in
which holders of the Company's stock are to receive stock, securities or
property of another corporation; or
15.3. of any voluntary dissolution, liquidation or winding-up of the
Company; or
15.4. of any redemption of any outstanding capital stock of the
Company;
then, and in each such case, the Company will mail or cause to be mailed to the
Registered Holder of this Warrant a notice specifying, as the case may be, (i)
the date on which a record is to be taken for the purpose of such dividend,
distribution or right, or (ii) the date on which such reorganization,
reclassification, consolidation, merger, conveyance, dissolution, liquidation,
winding-up, redemption or conversion is to take place, and the time, if any is
to be fixed, as of which the holders of record of Common Stock (or such stock or
securities as at the time are receivable upon the exercise of this Warrant)
shall be entitled to exchange their shares of Common Stock (or such other stock
or securities) for securities or other property deliverable upon such
reorganization, reclassification, consolidation, merger, conveyance,
dissolution, liquidation or winding-up. Such notice shall be delivered at least
thirty (30) days prior to the date therein specified.
16. SEVERABILITY. If any term, provision, covenant or restriction of this
Warrant is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Warrant shall remain in full force and effect and shall in
no way be affected, impaired or invalidated.
17. COUNTERPARTS. For the convenience of the parties, any number of
counterparts of this Warrant may be executed by the parties hereto and each such
executed counterpart shall be, and shall be deemed to be, an original
instrument.
18. SATURDAYS, SUNDAYS AND HOLIDAYS. If the Expiration Date falls on a
Saturday, Sunday or legal holiday, the Expiration Date shall automatically be
extended until 5:00 p.m. on the next business day.
10.20-12
IN WITNESS WHEREOF, the parties hereto have executed this Warrant as of
the Effective Date.
COMPANY: HOLDER
------- ------
ALPHA VIRTUAL, INC. Manhattan Capital Partners, LLC
By: By:
------------------------------- ---------------------------
Name: Xxxx Xxxxxxx Name: Xxxx Xxxxxx
Title: President Title: Managing Director
Address for Notices: Address for Notices:
SIGNATURE PAGE TO WARRANT
10.20-13
EXHIBIT 1
NOTICE OF EXERCISE
(To be executed upon exercise of Warrant)
WARRANT NO. ___
------------------
The undersigned hereby irrevocably elects to exercise the right of purchase
represented by the within Warrant Certificate for, and to purchase thereunder,
the securities of TMSF Holdings, Inc., as provided for therein, and (check the
applicable box):
|_| Tenders herewith payment of the exercise price in full in the form of
cash or a certified or official bank check in same-day funds in the
amount of $____________ for _________ such securities.
|_| Elects the Net Issue Exercise option pursuant to Section 2.2 of the
Warrant, and accordingly requests delivery of a net of ______________
of such securities, according to the following calculation:
X = Y (A-B) ( ) = (____) [(_____) - (_____)]
------- ---------------------------
A (_____)
Where X = the number of shares of Common Stock to be issued to the
Registered Holder.
Y = the number of shares of Common Stock purchasable under the amount
of the Warrant being exchanged (as adjusted to the date of such
calculation).
A = the Fair Market Value of one share of the Company's Common Stock.
B = Purchase Price (as adjusted to the date of such calculation).
|_| Elects the Net Issue Exercise option pursuant to Section 2.2 of the
Warrant, and accordingly requests delivery of a net of ______________
of such securities, according to the following calculation:
Please issue a certificate or certificates for such securities in the name of,
and pay any cash for any fractional share to (please print name, address and
social security number):
Name:
-----------------------------------------------------
Address:
-----------------------------------------------------
Signature:
-----------------------------------------------------
Note: The above signature should correspond exactly with the name on the first
page of this Warrant Certificate or with the name of the assignee appearing in
the assignment form below.
10.20-14
If said number of shares shall not be all the shares purchasable under the
within Warrant Certificate, a new Warrant Certificate is to be issued in the
name of said undersigned for the balance remaining of the shares purchasable
thereunder rounded up to the next higher whole number of shares.
10.20-15
EXHIBIT 2
ASSIGNMENT
(To be executed only upon assignment of Warrant Certificate) WARRANT NO. ___
For value received, hereby sells, assigns and transfers unto____________________
the within Warrant Certificate, together with all right, title and interest
therein, and does hereby irrevocably constitute and appoint ____________________
attorney, to transfer said Warrant Certificate on the books of the within-named
Company with respect to the number of Warrants set forth below, with full power
of substitution in the premises:
----------------------------- ---------------------------- --------------------
Name(s) of Assignee(s) Address # of Warrants
----------------------------- ---------------------------- --------------------
----------------------------- ---------------------------- --------------------
----------------------------- ---------------------------- --------------------
----------------------------- ---------------------------- --------------------
----------------------------- ---------------------------- --------------------
----------------------------- ---------------------------- --------------------
And if said number of Warrants shall not be all the Warrants represented by the
Warrant Certificate, a new Warrant Certificate is to be issued in the name of
said undersigned for the balance remaining of the Warrants registered by said
Warrant Certificate.
Dated:
-----------------------------------------------------
Signature:
-----------------------------------------------------
Notice: The signature to the foregoing Assignment must correspond to the name as
written upon the face of this security in every particular, without alteration
or any change whatsoever; signature(s) must be guaranteed by an eligible
guarantor institution (banks, stock brokers, savings and loan associations and
credit unions with membership in an approved signature guarantee medallion
program) pursuant to Securities and Exchange Commission Rule 17Ad-15.
10.20-16
