CLASS A COMMON STOCK PURCHASE WARRANT AGREEMENT BLOCKCHAIN INDUSTRIES, INC.
Exhibit 4.1
NEITHER THIS SECURITY NOR THE SECURITIES FOR WHICH THIS SECURITY IS
EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE
UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), AND,
ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND
IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY
A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE
SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY.
THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS
SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN
ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.
CLASS A COMMON STOCK PURCHASE WARRANT AGREEMENT
Number
of Warrants: _________ Initial Issue Date: January __,
2018
Exercise
Price: $___________
THIS
COMMON STOCK PURCHASE WARRANT AGREEMENT (the “Warrant”) certifies that,
for value received, ___________________, having an address at
___________________ or his/her/its assigns (the “Holder”) is entitled,
upon the terms and subject to the limitations on exercise and the
conditions hereinafter set forth, at any time on or after the date
hereof (the “Initial
Issue Date”) and on or prior to the close of business
on the ______ (__) year anniversary of the Initial Issue Date (the
“Termination
Date”), to subscribe for and purchase from Blockchain
Industries, Inc., a Nevada corporation (the “Company”), with offices
located at 00 Xxxxx Xxxxxxxx, Xxxxx
000, Xxx Xxxx Xxxxxx Xxxx, 00000, up to _________ (_____)
shares of the Company’s common stock, par value $0.001 (the
“Warrant Shares”) underlying the _________ (______)
Class A Warrants evidenced by this Class A Common Stock Purchase
Warrant, at the exercise price as defined in Section 1.2 below. The
number of Warrant Shares is subject to adjustment as set forth in
Article 2 hereinbelow.
ARTICLE 1 EXERCISE RIGHTS
The
Holder will have the right to exercise this Warrant to purchase
shares of Common Stock as set forth below.
1.1 Exercise
of Warrant. Exercise of the purchase rights represented by
this Warrant may be made, in whole or in part, from and after the
Initial Issue Date, and then at any time, by delivery to the
Company (or such other office or agency of the Company as it may
designate by notice in writing to the registered Holder at the
address of the Holder appearing on the books of the Company) of a
duly executed facsimile or emailed copy of the Notice of Exercise
form annexed hereto. Within three (3) business days following the
date of exercise as aforesaid, the Holder shall deliver the
aggregate Exercise Price for the shares specified in the applicable
Notice of Exercise by wire transfer or check drawn on a United
States bank unless the cashless exercise procedure specified in
Section 1.3 below is specified in the applicable Notice of
Exercise. Partial exercises of this Warrant resulting in purchases
of a portion of the total number of Warrant Shares available
hereunder shall have the effect of lowering the outstanding number
of Warrant Shares purchasable hereunder in an amount equal to the
applicable number of Warrant Shares purchased. The Holder and the
Company shall maintain records showing the number of Warrant Shares
purchased and the date of such purchases. The Company shall deliver
any objection to any Notice of Exercise form within 24 hours of
receipt of such notice. The Holder and any assignee, by acceptance
of this Warrant, acknowledge and agree that, by reason of the
provisions of this paragraph, following the purchase of a portion
of the Warrant Shares hereunder, the number of Warrant Shares
available for purchase hereunder at any given time may be less than
the amount stated on the face hereof.
1.2 Exercise
Price. The exercise price per share of Common Stock under
this Warrant shall be $_____ per share, subject to adjustment
hereunder (the “Exercise
Price”).
1.3 Delivery
of Warrant Shares. Warrant Shares purchased hereunder will
be delivered to Holder by 2:30 pm EST within three (3) business
days of Notice of Exercise by “DWAC/FAST” electronic
transfer (such date, the “Warrant Share Delivery
Date”) or by delivery of physical certificate. For
example, if Xxxxxx delivers a Notice of Exercise to the Company at
5:15 pm eastern time on Monday January 1st, the
Company’s transfer agent must deliver shares to
Xxxxxx’s broker via “DWAC/FAST” electronic
transfer by no later than 2:30 pm eastern time on Wednesday January
3rd. The
Warrant Shares shall be deemed to have been issued, and Holder or
any other person so designated to be named therein shall be deemed
to have become a holder of record of such shares for all purposes,
as of the date of delivery of the Notice of Exercise.
1.4 Delivery
of Warrant. The Holder shall not be required to physically
surrender this Warrant to the Company. If the Holder has purchased
all of the Warrant Shares available hereunder and the Warrant has
been exercised in full, this Warrant shall automatically be
cancelled without the need to surrender the Warrant to the Company
for cancellation. If this Warrant shall have been exercised in
part, the Company shall, at the request of Xxxxxx and upon
surrender of this Warrant, at the time of delivery of the Warrant
Shares, deliver to the Holder a new Warrant evidencing the rights
of the Holder to purchase the unpurchased Warrant Shares called for
by this Warrant, which new Warrant shall in all other respects be
identical with this Warrant and, for purposes of Rule 144, shall
tack back to the original date of this Warrant.
1.5 Warrant
Exercise Rescission Rights. For any reason in Holder’s
sole discretion, including if the Warrant Shares are not delivered
by DWAC/FAST electronic transfer or in accordance with the
timeframe stated in Section 1.4, or for any other reason, Holder
may, at any time prior to selling those Warrant Shares rescind such
exercise, in whole or in part, in which case the Company must,
within three (3) days of receipt of notice from the Holder, repay
to the Holder the portion of the exercise price so rescinded and
reinstate the portion of the Warrant and equivalent number of
Warrant Shares for which the exercise was rescinded and, for
purposes of Rule 144, such reinstated portion of the Warrant and
the Warrant Shares shall tack back to the original date of this
Warrant. If Warrant Shares were issued to Holder prior to
Xxxxxx’s rescission notice, upon return of payment from the
Company, Holder will, within three (3) days of receipt of payment,
commence procedures to return the Warrant Shares to the
Company.
1.6 Charges,
Taxes and Expenses. Issuance of Warrant Shares shall be made
without charge to the Holder for any issue or transfer tax or other
incidental expense in respect of the issuance of such shares, all
of which taxes and expenses shall be paid by the Company, and such
Warrant Shares shall be issued in the name of the Holder or in such
name or names as may be directed by the Holder. The Company shall
pay all transfer agent fees required for same-day processing of any
Notice of Exercise.
1.7 Holder’s
Exercise Limitations. Unless otherwise agreed in writing by
both the Company and the Holder, at no time will the Holder
exercise any amount of this Warrant to purchase Common Stock that
would result in the Holder owning more than 4.99% of the Common
Stock outstanding of the Company (the “Beneficial Ownership
Limitation”). Upon the written or oral request of
Xxxxxx, the Company shall within twenty-four (24) hours confirm
orally and in writing to the Holder the number of shares of Common
Stock then outstanding.
ARTICLE 2 ADJUSTMENTS
2.1 Stock
Dividends and Splits. If the Company, at any other time
while this Warrant is outstanding: (i) pays a stock dividend or
otherwise makes a distribution or distributions on shares of its
Common Stock or any other equity or equity equivalent securities
payable in shares of Common Stock (which, for avoidance of doubt,
shall not include any shares of Common Stock issued by the Company
upon exercise of this Warrant), (ii) subdivides outstanding shares
of Common Stock into a larger number of shares, (iii) combines
(including by way of reverse stock split) outstanding shares of
Common Stock into a smaller number of shares or (iv) issues by
reclassification of shares of the Common Stock any shares of
capital stock of the Company, then in each case the Exercise Price
shall be multiplied by a fraction of which the numerator shall be
the number of shares of Common Stock (excluding treasury shares, if
any) outstanding immediately before such event and of which the
denominator shall be the number of shares of Common Stock
outstanding immediately after such event, and the number of shares
issuable upon exercise of this Warrant shall be proportionately
adjusted such that the aggregate Exercise Price of this Warrant
shall remain unchanged. Any adjustment made pursuant to this
Section 2.1 shall become effective immediately after the record
date for the determination of stockholders entitled to receive such
dividend or distribution and shall become effective immediately
after the effective date in the case of a subdivision, combination
or re-classification.
2.2 Pro
Rata Distributions. If the Company, at any time while this
Warrant is outstanding, shall distribute to all holders of Common
Stock (and not to the Holder) evidences of its indebtedness or
assets (including cash and cash dividends) or rights or warrants to
subscribe for or purchase any security other than the Common Stock,
then in each such case the Exercise Price shall be adjusted by
multiplying the Exercise Price in effect immediately prior to the
record date fixed for determination of stockholders entitled to
receive such distribution by a fraction of which the denominator
shall be the VWAP determined as of the record date mentioned above,
and of which the numerator shall be such VWAP on such record date
less the then per share fair market value at such record date of
the portion of such assets or evidence of indebtedness or rights or
warrants so distributed applicable to one outstanding share of the
Common Stock as determined by the Board of Directors in good faith.
In either case the adjustments shall be described in a statement
provided to the Holder of the portion of assets or evidences of
indebtedness so distributed or such subscription rights applicable
to one share of Common Stock. Such adjustment shall be made
whenever any such distribution is made and shall become effective
immediately after the record date mentioned above.
2.3 Notice
to Holder. Whenever there is an event as set forth in
Section 2.1 or 2.2 above (the “Adjustment Event”), the
Company shall promptly notify
the Holder (by written notice) setting forth the Adjustment Event
and any resulting adjustment to the number of Warrant Shares and
setting forth a brief statement of the facts requiring such
adjustment.
ARTICLE 3 COMPANY COVENANTS
3.1 Reservation
of Shares. As of the issuance date of this Warrant and for
the remaining period during which the Warrant is exercisable, the
Company will reserve from its authorized and unissued Common Stock
a sufficient number of shares to provide for the issuance of
Warrant Shares upon the full exercise of this Warrant. The Company
represents that upon issuance, such Warrant Shares will be duly and
validly issued, fully paid and non-assessable. The Company agrees
that its issuance of this Warrant constitutes full authority to its
officers, agents and transfer agents who are charged with the duty
of executing and issuing shares to execute and issue the necessary
Warrant Shares upon the exercise of this Warrant. No further
approval or authority of the stockholders of the Board of Directors
of the Company is required for the issuance of the Warrant
Shares.
3.2 No
Adverse Actions. Except and to the extent as waived or
consented to by the Holder, the Company shall not by any action,
including, without limitation, amending its certificate of
incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or
any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of this Warrant, but will at all
times in good faith assist in the carrying out of all such terms
and in the taking of all such actions as may be necessary or
appropriate to protect the rights of Holder as set forth in this
Warrant against impairment. Without limiting the generality of the
foregoing, the Company will (i) not increase the par value of any
Warrant Shares above the amount payable therefor upon such exercise
immediately prior to such increase in par value, (ii) take all such
action as may be necessary or appropriate in order that the Company
may validly and legally issue fully paid and non-assessable Warrant
Shares upon the exercise of this Warrant and (iii) use commercially
reasonable efforts to obtain all such authorizations, exemptions or
consents from any public regulatory body having jurisdiction
thereof, as may be, necessary to enable the Company to perform its
obligations under this Warrant.
ARTICLE 4 MISCELLANEOUS
4.1 Representation
by the Holder. The Holder, by the acceptance hereof,
represents and warrants that it is acquiring this Warrant and, upon
any exercise hereof, will acquire the Warrant Shares issuable upon
such exercise, for its own account and not with a view to or for
distributing or reselling such Warrant Shares or any part thereof
in violation of the Securities Act or any applicable state
securities law, except pursuant to sales registered or exempted
under the Securities Act.
4.2 Transferability.
Subject to compliance with any applicable securities laws, this
Warrant and all rights hereunder (including, without limitation,
any registration rights) are transferable, in whole or in part, by
a written assignment of this Warrant duly executed by the Holder or
its agent or attorney. If necessary to obtain a new warrant for any
assignee, the Company, upon surrender of this Warrant, shall
execute and deliver a new Warrant or Warrants in the name of the
assignee or assignees, as applicable, and in the denomination or
denominations specified in such instrument of assignment, and shall
issue to the assignor a new Warrant evidencing the portion of this
Warrant not so assigned, and such new Warrants, for purposes of
Rule 144, shall tack back to the original date of this Warrant. The
Warrant, if properly assigned in accordance herewith, may be
exercised by a new holder for the purchase of Warrant Shares
without having a new Warrant issued.
4.3 Assignability.
This Warrant will be binding upon the Company and its successors,
and will inure to the benefit of the Holder and its successors and
assigns, and may be assigned by the Holder to anyone of its
choosing without the Company’s approval.
4.4 Notices.
Any notice required or permitted hereunder must be in writing and
either personally served, sent by facsimile or email transmission,
or sent by overnight courier. Notices will be deemed effectively
delivered at the time of transmission if by facsimile or email, and
if by overnight courier the business day after such notice is
deposited with the courier service for delivery.
4.5 Governing
Law. This Warrant will be governed by, and construed and
enforced in accordance with, the laws of the State of New York,
without regard to the conflict of laws principles thereof. Any
action brought by either party against the other concerning the
transactions contemplated by this Warrant shall be brought only in
the state courts of New York or in the federal courts located in
the State of New York. Both parties and the individuals signing
this Agreement agree to submit to the jurisdiction of such
courts.
4.6 Delivery
of Process by Holder to the Company. In the event of any
action or proceeding by Holder against the Company, and only by
Holder against the Company, service of copies of summons and/or
complaint and/or any other process which may be served in any such
action or proceeding may be made by Holder via U.S. Mail, overnight
delivery service such as FedEx or UPS, email, fax, or process
server, or by mailing or otherwise delivering a copy of such
process to the Company at its last known address or to its last
known attorney set forth in its most recent SEC
filing.
4.7 No
Rights as Stockholder Until Exercise. This Warrant does not
entitle the Holder to any voting rights, dividends or other rights
as a stockholder of the Company prior to the exercise hereof as set
forth in Section 1.1. So long as this Warrant is unexercised, this
Warrant carries no voting rights and does not convey to the Holder
any “control” over the Company, as such term may be
interpreted by the SEC under the Securities Act or the Exchange
Act, regardless of whether the price of the Company’s Common
Stock exceeds the Exercise Price.
4.8 Limitation
of Liability. No provision hereof, in the absence of any
affirmative action by the Holder to exercise this Warrant to
purchase Warrant Shares, and no enumeration herein of the rights or
privileges of the Holder, shall give rise to any liability of the
Holder for the purchase price of any Common Stock or as a
stockholder of the Company, whether such liability is asserted by
the Company or by creditors of the Company.
4.9 Attorney
Fees. In the event any attorney is employed by either party
to this Warrant with regard to any legal or equitable action,
arbitration or other proceeding brought by such party for the
enforcement of this Warrant or because of an alleged dispute,
breach, default or misrepresentation in connection with any of the
provisions of this Warrant, the prevailing party in such proceeding
will be entitled to recover from the other party reasonable
attorneys’ fees and other costs and expenses incurred, in
addition to any other relief to which the prevailing party may be
entitled.
4.10 Opinion
of Counsel. In the event that an opinion of counsel is
needed for any matter related to this Warrant, Xxxxxx has the right
to have any such opinion provided by its counsel. Xxxxxx also has
the right to have any such opinion provided by the Company’s
counsel.
4.11 Nonwaiver.
No course of dealing or any delay or failure to exercise any right
hereunder on the part of Holder shall operate as a waiver of such
right or otherwise prejudice the Holder’s rights, powers or
remedies.
4.12 Amendment
Provision. The term “Warrant” and all references
thereto, as used throughout this instrument, means this instrument
as originally executed, or if later amended or supplemented, then
as so amended or supplemented.
4.13 No
Shorting. Xxxxxx agrees that so long as this Warrant remains
unexercised in whole or in part, Holder will not enter into or
effect any “short sale” of the common stock or hedging
transaction which establishes a net short position with respect to
the common stock of the Company. The Company acknowledges and
agrees that as of the date of delivery to the Company of a fully
and accurately completed Notice of Exercise, Holder immediately
owns the common shares described in the Notice of Exercise and any
sale of those shares issuable under such Notice of Exercise would
not be considered short sales.
IN
WITNESS WHEREOF, the Company have caused this Class A Common Stock
Purchase Warrant to be duly executed as of the date first above
written.
By:
__________________________________
Name:
Xxxxxxx Xxxxxxxx
Title:
Chairman and CEO
NOTICE OF EXERCISE
(1) The undersigned
hereby elects to purchase ________ Warrant Shares of the Company
pursuant to the terms of the attached Warrant (only if exercised in
full), and tenders herewith payment of the exercise price in full,
together with all applicable transfer taxes, if any.
(2) Payment shall take
the form of (check applicable box):
[ ] in
lawful money of the United States; or
[ ] the
cancellation of such number of Warrant Shares as is necessary, in
accordance with the formula set forth in Section 1.3, to exercise
this Warrant with respect to the maximum number of Warrant Shares
purchasable pursuant to the cashless exercise procedure set forth
in Section 1.3.
(3) Please issue a
certificate or certificates representing said Warrant Shares in the
name of the undersigned or in such other name as is specified
below:
_______________________________
The
Warrant Shares shall be delivered to the following DWAC Account
Number:
_______________________________
_______________________________
_______________________________
(4)
Accredited
Investor. The undersigned is an “accredited
investor” as defined in Regulation D promulgated under the
Securities Act of 1933, as amended.
[SIGNATURE
OF HOLDER]
Name:
_______________________________________
Date:
________________________________________
