EXHIBIT 10.2
THIS WARRANT AND THE SHARES OF COMMON STOCK OF EGAMES, INC. THAT MAY BE
PURCHASED UPON THE EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE SOLD,
ASSIGNED OR TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH
SECURITIES UNDER THE SECURITIES ACT, UNLESS THE COMPANY HAS RECEIVED THE WRITTEN
OPINION OF COUNSEL SATISFACTORY TO THE COMPANY TO THE EFFECT THAT SUCH SALE,
ASSIGNMENT OR TRANSFER DOES NOT INVOLVE A TRANSACTION REQUIRING REGISTRATION OF
SUCH SECURITIES UNDER THE SECURITIES ACT.
Issue Date: October 31, 2001
Void After: October 31, 2006
EGAMES, INC.
COMMON STOCK PURCHASE WARRANT
This Warrant Agreement (this "Warrant Agreement") and the related Registration
Rights Agreement have been entered into in connection with the execution of the
Forbearance Agreement dated as of October 31, 2001, the terms of which are
incorporated herein by reference as if set forth in full herein (the
"Forbearance Agreement"), by and between, eGames, Inc., a Pennsylvania
corporation (who together with any successor shall be referred to as the
"Company") and Fleet National Bank, successor in interest to Summit Bank, a
state banking corporation (the "Holder").
THIS CERTIFIES that, for value received, the Holder is entitled, upon the
terms and subject to the conditions hereinafter set forth, to subscribe for and
purchase from the Company, at the Exercise Price provided herein, up to 750,000
fully paid and nonassessable shares (the "Warrant Shares") of Common Stock, no
par value per share, of the Company (the "Common Stock"). Such number of Warrant
Shares shall be subject to adjustment as provided for elsewhere herein.
1. Exercise Period - The purchase rights represented by this Warrant are
exercisable by the Holder, in whole or in part, at any time from time to time
during the "Exercise Period," which shall commence on October 31, 2001 (the
"Issue Date") and shall end at 5:00 p.m. Philadelphia, Pennsylvania time on
October 31, 2006 (the "Expiration Date"), subject to the provisions of Section 3
hereof.
2. Exercise Price - The price per share of Common Stock at which this
Warrant may be exercised (the "Exercise Price") shall be nine cents ($0.09),
subject to adjustment as provided herein.
3. Exercise of Warrant.
(a) During the Exercise Period, this Warrant shall be exercisable
from time to time in the discretion of the Holder to the following extent: (a)
to the extent of 250,000 of the Warrant Shares, commencing upon the Issue Date;
(b) to the extent of an additional 250,000 of the Warrant Shares, commencing
April 1, 2002 unless the Company shall have fulfilled all of its obligations and
paid all amounts due and owing to the Holder under the Forbearance Agreement
prior to such date; and (c) to the extent of an additional 250,000 of the
Warrant Shares, commencing October 1, 2002 unless the Company shall have
fulfilled all of its obligations and paid all amounts due and owing to the
Holder under the Forbearance Agreement after March 31, 2002 but prior to October
1, 2002. Accordingly, (x) to the extent to which the Company shall have
fulfilled all of its obligations and paid all amounts due and owing to the
Holder under the Forbearance Agreement prior to April 1, 2002, 500,000 of the
Warrant Shares shall never be exercisable by the Holder, and (y) to the extent
to which the Company shall have fulfilled all of its obligations and paid all
amounts due and owing to the Holder under the Forbearance Agreement after March
31, 2002 but prior to October 1, 2002, 250,000 of the Warrant Shares shall never
be exercisable by the Holder.
(b) Notwithstanding anything in Section 3 (a) to the contrary,
all of the Warrant Shares shall be immediately exercisable upon any Event of
Default as defined by the Forbearance Agreement.
(c) During the Exercise Period, this Warrant may be exercised
from time to time in accordance with Section 3(a) hereof by the surrender of
this Warrant and the Notice of Exercise annexed hereto (the "Notice of
Exercise") and upon payment of the Exercise Price of the shares of Common Stock
thereby purchased (the "Exercised Shares").
Payment of the Exercise Price for the Exercised Shares may be made (i) by
certified check payable to the order of the Company, (ii) by wire transfer of
immediately-available funds to the account of the Company, or (iii) by delivery
of this Warrant with instructions that the Company retain as payment of the
Exercise Price such number of shares of Common Stock as shall be determined
under the next sentence (a "Cashless Exercise") or (iv) by any combination of
the foregoing. In the event of a Cashless Exercise, the Holder, in lieu of
paying the Exercise Price by certified check or wire transfer as provided for
above, shall receive that number of shares of Common Stock determined by
multiplying the number of Exercised Shares for which the Cashless Exercise is
made by a fraction, the numerator of which shall be the positive difference
between the then Current Market Price (as defined blow) per Warrant Share (on
the date the Company receives the Notice of Exercise) and the Exercise Price,
and the denominator of which shall be the then Current Market Price per Warrant
Share (on the date the Company receives the Notice of Exercise), and the
remaining Exercised Shares for which the Cashless Exercise has been made for
which shares of Common Stock shall not have been issued shall be deemed to have
been paid to the Company as the Exercise Price and all Warrants related thereto
shall be thereby deemed exercised and canceled. Upon exercise, the Holder shall
be entitled to receive, promptly after payment in full, one or more
certificates, issued in the Holder's name or in such name or names as the Holder
may direct for the number of Warrant Shares so purchased. The Warrant Shares so
purchased shall be deemed to be issued as of the close of business on the date
on which the Company receives a duly executed and completed Notice of Exercise
and, if applicable, the Exercise Price. The Company covenants that all Warrant
Shares that are issued upon the exercise of rights represented by this Warrant
will be fully paid, nonassessable, and free from all taxes, liens and charges in
respect of the issue thereof (other than taxes in respect of any transfer
occurring contemporaneously with such issue).
To the extent to which this Warrant shall have been partially exercised by the
Holder, the Company upon the surrender of this Warrant shall issue a new Warrant
certificate to the Holder, identical to the terms hereof except to the extent of
a reduction in the number of shares for which this Warrant may be exercised.
(d) "Current Market Price" is defined as the arithmetic mean of
the highest and lowest selling prices of the shares of Common Stock of the
Company quoted on the OTC Bulletin Board* Service provided by NASD, Inc., or as
reported by a nationally recognized broker/dealer which makes a market in the
shares of Common Stock, or as reported by equivalent exchanges or markets as may
heretofore or hereafter be utilized by the Company, during the ten days prior to
such valuation date during which trading occurred (but no more than 30 calendar
days prior to such valuation date). If there were no sales of shares of Common
Stock during the 30 calendar days prior to the valuation date but there were
sales within 60 calendar days before the valuation date, Current Market Value is
determined by taking the mean between the highest and lowest selling prices of
the shares of Common Stock during the ten days during which trading occurred
that are closest in time to the valuation date. If actual sales are not
available during such 60-day period before the valuation date, and the Board of
Directors of the Company (the "Board") determines that the Current Market Value
of the shares of Common Stock cannot be determined on the basis of the selling
or bid and asked prices pursuant to any of the methods set forth above, then the
Current Market Value of the shares of Common Stock shall be established by the
Board acting in good faith and using all available financial data and other
current factors affecting Current Market Value.
4. Fractional Warrant Shares - Fractional shares of Common Stock will not
be issued upon exercise of the Warrants and will instead be rounded off to the
nearest whole number of shares.
5. Charges, Taxes and Expenses - Issuance of certificates for the shares of
Common Stock shall be made by the Company without charge to the Holder for any
incidental expense in respect of the issuance of such certificate; provided,
however, that the Holder shall be responsible for any issue or transfer tax
associated with such issuance.
6. Holder Representations - The Holder represents and warrants to the
Company as of the date hereof, and at the time of exercise of this Warrant shall
be deemed to represent to the Company, with the understanding that the Company
shall rely on such representations and warranties, that it (i) is an "Accredited
Investor" as that term is defined in Rule 501 of Regulation D promulgated under
the Securities Act; (ii) has the ability to bear the economic risks of such
Holder's prospective investment, including a complete loss of Holder's
investment in this Warrant and the shares of Common Stock issuable upon exercise
thereof; (iii) has been furnished with and has had access to such information as
such Holder has considered necessary to make a determination as to acquire this
Warrant and to purchase of the shares of Common Stock upon exercise of this
Warrant, together with such additional information as is necessary to verify the
accuracy of the information supplied; (iv) has had the opportunity to ask
questions concerning the Company and had all questions which have been asked by
such Holder satisfactorily answered by the Company; and (v) has not been offered
this Warrant or shares of Common Stock subject thereto by any form of
advertisement, article, notice or other communication published in any
newspaper, magazine, or similar media or broadcast over television or radio, or
any seminar or meeting whose attendees have been invited by any such media. The
Holder, by acceptance of this Warrant, represents and warrants to the Company
that this Warrant and all securities acquired upon any and all exercises of this
Warrant are purchased for the Holder's own account for investment, and not with
view to distribution of either this Warrant or any securities purchasable upon
exercise hereof.
7. Organization and Standing - The Company hereby represents and warrants
to the Holder that the Company is a corporation duly organized, validly existing
and in good standing under the laws of the Commonwealth of Pennsylvania and has
all requisite corporate power and authority to carry on its businesses as now
conducted and as proposed to be conducted. The Company hereby represents and
warrants to the Holder that the Company is duly qualified or licensed to do
business as a corporation and is in good standing in all jurisdictions where
such qualification or licensing is required, except where the failure to so
qualify would not have a material adverse effect upon the business, assets,
liabilities, condition (financial or otherwise) or operations of the Company.
8. Company Power - The Company hereby represents and warrants to the Holder
that the Company has all corporate power necessary for the authorization,
execution and delivery of this Warrant and this Warrant constitutes a valid and
binding obligation of the Company enforceable against the Company in accordance
with its terms, except as the same may be limited by bankruptcy, insolvency,
moratorium, and other laws of general application affecting the enforcement of
creditors' rights.
9. Adjustments - The Exercise Price and the number and kind of securities
purchasable hereunder are subject to adjustment from time to time, as follows:
(a) Merger Events. If at any time there shall be a capital
reorganization of the shares of the Company's Common Stock (other than a
combination, reclassification, exchange or subdivision of shares otherwise
provided for herein), or a merger or consolidation of the Company with or into
another corporation when the Company is not the surviving corporation, the sale
of all or substantially all of the Company's properties and assets to any other
person, or the spin off of all or substantially all of the Company's assets into
another entity that must be approved, in whole or in part, by the Company's
stockholders (hereinafter collectively referred to as a 'Merger Event'), then,
as a part of such Merger Event, lawful provision shall be made so that the
Holder shall thereafter be entitled to receive, upon exercise of the Warrant,
the number of shares of Common Stock or other securities of the successor
corporation resulting from such Merger Event, equivalent in value to that which
would have been issuable if the Holder had exercised this Warrant immediately
prior to the Merger Event to the full extent of the Warrant Shares. In any such
case, appropriate adjustment (as determined in good faith by the Board) shall be
made in the application of the provisions of the Warrant Agreement with respect
to the rights and interest of the Holder after the Merger event to the end that
the provisions of this Warrant Agreement (including adjustments of the Exercise
Price of shares of Common Stock purchasable) shall be applicable to the greatest
extent possible.
(b) Reclassification of Shares. If the Company at any time shall,
by combination, reclassification, exchange or subdivision of securities or
otherwise, change any of the securities as to which purchase rights under this
Warrant Agreement exist into the same or a different number of securities of any
other class or classes, this Warrant Agreement 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 which were subject
to the purchase rights under this Warrant Agreement immediately prior to such
combination, reclassification, exchange, subdivision or other change.
(c) Subdivision or Combination of Shares. If the Company at any
time shall combine or subdivide its Common Stock, the Exercise Price shall be
proportionately decreased in the case of a subdivision, or proportionately
increased in the case of a combination, and the number of shares available for
purchase in effect immediately prior to such subdivision or combination shall be
proportionately adjusted.
(d) Stock Dividends. If the Company at any time shall pay a
dividend payable in, or make any other distribution (except any distribution
specifically provided for in the foregoing Sections 9(a) or 9(b)) of, the
Company's stock, then the Exercise Price shall be adjusted, from and after the
record date of such dividend or distribution, to that price determined by
multiplying the Exercise Price in effect immediately prior to such record date
by a fraction (i) the numerator of which shall be the total number of all shares
of the Company's stock outstanding immediately prior to such dividend or
distribution, and (ii) the denominator of which shall be the total number of all
shares of the Company's stock outstanding immediately after such dividend or
distribution. The Holder shall thereafter be entitled to purchase, at the
Exercise Price resulting from such adjustment, the number of shares of Common
Stock (calculated to the nearest whole share) obtained by multiplying the
Exercise Price in effect immediately prior to such adjustment by the number of
shares of Common Stock issuable upon the exercise hereof immediately prior to
such adjustment and dividing the product thereof by the Exercise Price resulting
from such adjustment.
(e) Antidilution Rights. If and whenever after the Issue Date and
prior to November 1, 2004, the Company shall issue or sell any (i) shares of its
Common Stock, (ii) option, warrant or right to purchase Common Stock or
securities convertible into or exchangeable for Common Stock, or (iii)
securities convertible into or exchangeable for Common Stock, for consideration
per share or at an exercise price or at a conversion price per share that is
less than the Exercise Price (any of the foregoing, a "Diluting Issuance"), the
Exercise Price under this Warrant Agreement shall be reduced to the amount of
consideration per share received by the Company in such issuance or sale;
provided, however, that the foregoing shall not apply to the issuance or sale
during this time period of Excepted Securities (as hereafter defined) or to the
exercise or conversion of such Excepted Securities, as applicable.
If and whenever after October 31, 2004, there shall be a Diluting Issuance, the
Exercise Price under this Warrant Agreement shall be adjusted from time to time
pursuant to the weighted average antidilution method set forth below (the
"Weighted Average Method"), provided, however, that the foregoing shall not
apply to the issuance or sale during this time period of Excepted Securities:
If the Company shall issue or sell any shares of its Common Stock for
consideration per share less than the Exercise Price in effect
immediately prior to the time of such issue or sale, then, the
Exercise Price shall be reduced to a price (calculated to the nearest
cent) equal to the price determined by dividing (i) an amount equal to
the sum of (A) the number of shares of Common Stock outstanding
immediately prior to such issue or sale multiplied by the then
existing Exercise Price and (B) the consideration, if any, received by
the Company upon such issue or sale by (ii) the total number of shares
of Common Stock outstanding immediately after such issue or sale. For
purposes of this paragraph, the following Subsections (i) - (iii)
shall also be applicable:
(i) In the event that the Company shall in any manner grant
(directly, by assumption in a merger or otherwise) any rights to
subscribe for or to purchase, or any options for the purchase of (x)
Common Stock or (y) any stock or securities convertible into or
exchangeable for Common Stock (such rights or options being herein
called "Options" and such convertible or exchangeable stock or
securities being herein called "Convertible Securities"), or shall fix
a record date for determination of holders of any class of securities
entitled to receive any such Options, whether or not such Options or
the right to convert or exchange any such Convertible Securities are
immediately exercisable, and whether or not the price per share for
which Common Stock is issuable upon the exercise of such Options or
upon conversion or exchange of such Convertible Securities (determined
by dividing (A) the total amount, if any, received or receivable by
the Company as consideration for the granting of such Options, plus
the minimum aggregate amount of additional consideration payable to
the Company upon the exercise of all such Options, plus, in the case
of any such Options that relate to Convertible Securities, the minimum
aggregate amount of additional consideration, if any, payable upon the
issue or sale of such Convertible Securities and upon the conversion
or exchange thereof, by (B) the total number of shares of Common Stock
issuable upon the exercise of such Options or upon the conversion or
exchange of all such Convertible Securities issuable upon the exercise
of such Options) shall be less than the Exercise Price in effect
immediately prior to the time of the granting of such Options, then
the total number of shares of Common Stock issuable upon the exercise
of such Options or upon conversion or exchange of the total amount of
such Convertible Securities issuable upon the exercise of such Options
(as of the date of granting such Options) shall be deemed to be
outstanding and to have been issued for such price per share. Except
as otherwise provided in Section 9(e)(iii) below, no further
adjustment of the Exercise Price shall be made upon the actual issue
of such Common Stock or of such Convertible Securities upon exercise
of such Options or upon the actual issue of such Common Stock upon
conversion or exchange of such Convertible Securities.
(ii) In the event that the Company shall in any manner issue
(directly, by assumption in a merger or otherwise) or sell any
Convertible Securities (other than pursuant to the exercise of Options
to purchase such Convertible Securities covered by Section 9(e)(i)
above, or shall fix a record date for the determination of holders of
any class of securities entitled to receive any such Convertible
Securities, whether or not the rights to exchange or convert
thereunder are immediately exercisable, and whether or not the price
per share for which Common Stock is issuable upon such conversion or
exchange (determined by dividing (A) the total amount received or
receivable by the Company as consideration for the issue or sale of
such Convertible Securities, plus the minimum aggregate amount of
additional consideration, if any, payable to the Company upon the
conversion or exchange thereof, by (B) the total maximum number of
shares of Common Stock issuable upon the conversion or exchange of all
such Convertible Securities) shall be less than the Exercise Price in
effect immediately prior to the time of such issue, then the total
maximum number of shares of Common Stock issuable upon conversion or
exchange of all such Convertible Securities shall (as of the date of
the issue or sale of such Convertible Securities) be deemed to be
outstanding and to have been issued for such price per share, provided
that, except as otherwise provided in Section 9(e)(iii), no further
adjustment of the Exercise Price shall be made upon the actual issue
of such Common Stock upon conversion or exchange of such Convertible
Securities.
(iii) In connection with any change in, or the expiration or
termination of, the purchase rights under any Option or the conversion
or exchange rights under any Convertible Securities, the following
provisions shall apply:
(A) If the purchase price provided for in any
Option referred to in Section 9(e)(i), the additional consideration,
if any, payable upon the conversion or exchange of any Convertible
Securities referred to in Section 9(e)(i) or 9(e)(ii), or the rate at
which any Convertible Securities referred to in Section 9(e)(i) or
9(e)(ii) are convertible into or exchangeable for Common Stock shall
change at any time (other than under or by reason of provisions
designed to protect against dilution), then the Exercise Price in
effect at the time of such change shall forthwith be increased or
decreased to the Exercise Price that would be in effect immediately
after such change if (a) the adjustments that were made upon the
issuance of such Options or Convertible Securities had been made upon
the basis of (and taking into account the total consideration received
for) (i) the issuance at that time of the Common Stock, if any,
actually issued upon the exercise of any such Options or upon the
conversion or exchange of any such Convertible Securities before such
change, and (ii) the issuance at that time of all such Options or
Convertible Securities, with terms and provisions reflecting such
change that are still outstanding after such change, and (b) the
Exercise Price as adjusted pursuant to clause (a) preceding had been
used as the basis for the adjustments required hereunder in connection
with all other issues or sales of Common Stock, Options or Convertible
Securities by the Company subsequent to the issuance of such Options
or Convertible Securities.
(B) On the partial or complete expiration of any
Options or termination of any right to convert or exchange Convertible
Securities which have not been fully exercised, the Exercise Price
then in effect hereunder shall be forthwith increased or decreased to
the Exercise Price that would be in effect at the time of such
expiration or termination if (a) the adjustments that were made upon
the issuance of such Options or Convertible Securities had been made
upon the basis of (and taking into account the total consideration
received for) (i) the issuance at that time of the Common Stock, if
any, actually issued upon the exercise of such Options or upon the
conversion or exchange of such Convertible Securities before such
expiration or termination, and (ii) the issuance at that time of only
those such Options or Convertible Securities that remain outstanding
after such expiration or termination, and (b) the Exercise Price as
adjusted pursuant to clause (a) preceding had been used as the basis
for adjustments required hereunder in connection with all other issues
or sales of Common Stock, Options or Convertible Securities by the
Company subsequent to the issuance of such Options or Convertible
Securities.
(C) If the purchase price provided for in any
Option referred to in Section 9(e)(i) or the rate at which any
Convertible Securities referred to in Section 9(e)(i) or 9(e)(ii) are
convertible into or exchangeable for Common Stock shall be reduced at
any time under or by reason of provisions with respect thereto
designed to protect against dilution, and the event causing the
reduction is one that did not also require an adjustment in the
Exercise Price under other provisions of this Section 9(e), then in
case of the delivery of shares of Common Stock upon the exercise of
any such Option or upon conversion or exchange of any such Convertible
Securities, the Exercise Price then in effect hereunder shall
forthwith be adjusted to such amount as would have obtained if such
Option or Convertible Securities had never been issued and if the
adjustments made upon the issuance of such Option or Convertible
Securities had been made upon the basis of the issuance of (and taking
into account the total consideration received for) the shares of
Common Stock delivered as aforesaid; provided that no such adjustment
shall be made unless the Exercise Price then in effect would be
reduced thereby.
(D) If a record date for the issuance of any
Options or Convertible Securities shall have been fixed and such
Options or Convertible Securities are not issued on the date fixed
therefore, the adjustment previously made as provided in Section
9(e)(i) and 9(e)(ii) above to the relevant Exercise Price which
becomes effective on such record date shall be cancelled as of the
close of business on such record date, and thereafter such Exercise
Price shall be adjusted pursuant to Section 9(e)(i) or 9(e)(ii), as
the case may be, as of the actual date of their issuance.
Notwithstanding anything in subsections (i) - (iii) to the contrary, the terms
"Options" and "Convertible Securities" shall not include the issuance or sale of
Common Stock or securities convertible or exchangeable into Common Stock upon
the exercise of any option, warrant or right issued and outstanding as of the
Issue Date or upon the conversion or exchange of any convertible or exchangeable
security issued and outstanding as of the Issue Date, all of which shall be
deemed to be "Excepted Securities."
The following shall also not be deemed to be "Options" and "Convertible
Securities" and shall be deemed to be "Excepted Securities": (A) the issuance or
sale of stock options to (x) members of the Company's Board of Directors or (y)
Company employees and consultants who provide bona fide services under an
agreement or arrangement approved by the Board of Directors (collectively
"Excepted Stock Options"); (B) any issuance or sale of shares of the Company's
Common Stock, options, warrants or rights to purchase Common Stock or securities
convertible or exchangeable for Common Stock to any entity or individual in
connection with, directly or indirectly, the obtaining of funds used in whole or
in part for the purpose of paying amounts due and owing to the Holder under the
Forbearance Agreement (collectively "Take-Out Lender Securities"; and (C) the
issuance of securities upon conversion or exchange of securities in connection
with (A) or (B) of this paragraph; provided, however, that if and whenever, from
the Issue Date through the Expiration Date, the Company shall issue or sell
Excepted Stock Options or Take-Out Lender Securities for a consideration per
share or at an exercise price or at a conversion price per share that is less
than the Exercise Price under this Warrant Agreement, the Exercise Price shall
be adjusted pursuant to the Weighted Average Method set forth above.
Notwithstanding anything herein to the contrary, Excepted Securities shall not
include, and the anti-dilution protections set forth in this Section 9(e) shall
not apply to, the first 750,000 Excepted Stock Options issued or sold during the
Exercise Period.
(f) Notice of Adjustment - In each case of any adjustment or
readjustment in the Common Stock issuable upon the exercise of this Warrant, the
Company at its expense will promptly compute such adjustment or readjustment in
accordance with the terms of this Warrant and prepare a report setting forth
such adjustment or readjustment and showing in reasonable detail the method of
calculation thereof and the facts upon such adjustment or readjustment is based.
The Company shall forthwith mail a copy of each such report to the Holder.
10. No Rights as Stockholder - This Warrant does not entitle the Holder
to any voting rights, the right to receive cash dividends or other rights as a
stockholder of the Company prior to the exercise of the Warrant.
11. Reservation of Stock Issuable on Exercise of Warrant - The Company
will at all times reserve and keep available, solely for issuance and delivery
upon the exercise of this Warrant, all shares of Common Stock from time to time
issuable upon the exercise of this Warrant.
12. Loss, Theft, Destruction or Mutilation of Warrant - Upon receipt by
the Company of evidence reasonably satisfactory to it of the loss, theft,
destruction, or mutilation of this Warrant, and in case of loss, theft, or
destruction, of indemnity or security reasonably satisfactory to it, and upon
reimbursement to the Company of all reasonable expenses incidental thereto, and
upon surrender and cancellation of this Warrant, if mutilated, the Company will
make and deliver a new warrant of like tenor and dated as of such cancellation
in lieu of this Warrant.
13. Remedies - The Company stipulates that the remedies at law of the
Holder of this Warrant in the event of any default or threatened default by the
Company in the performance of or compliance with any of the terms of this
Warrant are not adequate and may be enforced by a decree for the specific
performance of any agreement contained herein or by an injunction against a
violation of any of the terms hereof or otherwise.
14. Notices, etc. - All notices and other communications from the
Company to the Holder of this Warrant shall be mailed, by first class mail or
nationally recognized overnight courier such as Federal Express, to such address
as may have been furnished to the Company in writing by such Holder, or, until
an address is so furnished, to and at the address of the last holder of this
Warrant who has so furnished an address to the Company. All communications from
the holder of this Warrant to the Company shall be mailed by first class mail or
nationally recognized overnight courier such as Federal Express to the Company
at it principal business address, or such other address as may have been
furnished to the Holder in writing by the Company.
15. Miscellaneous - This Warrant shall be construed and enforced in
accordance with and governed by the laws of the Commonwealth of Pennsylvania
without giving effect to the choice of law provisions thereof. The headings in
this Warrant are for purposes of reference only, and shall not limit or
otherwise affect any of the terms hereof. This Warrant, or any portion hereof
may, without the prior consent of the Company, be assigned to any entity
controlled by, controlling, or under common control with the Holder or to any
successor of the Holder, provided that the Company has received notice of such
transfer. Until the Warrant is transferred on the Company's books, the Company
shall treat the registered holder as the holder of this Warrant.
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed in
its corporate name by its duly authorized officer and to be dated as of the
issue date set forth on the first page of this Warrant.
ATTEST EGAMES, INC.
/s/ Xxxxxx X. Xxxxxxxx BY: /s/ Xxxxxx X. Xxxxxx
------------------------------ ------------------------
Xxxxxx X. Xxxxxxxx, Controller Xxxxxx X. Xxxxxx,
VP Finance, CFO
NOTICE OF EXERCISE OF WARRANT
TO: eGames, Inc.
Pursuant to the terms of the attached Warrant, the undersigned
hereby elects to purchase ____________ shares of the Common Stock of eGames,
Inc. (the "Company"), and tenders herewith payment of the Exercise Price of such
shares in full.
Pursuant to the terms of the attached Warrant, the undersigned
hereby elects to make a Cashless Exercise as provided for in Section 3(c) of
such Warrant with respect to ____________ shares of Common Stock.
(Check and complete the appropriate paragraph)
Please issue a certificate or certificates representing said
shares of Common Stock, in the name of the undersigned or in such other name(s)
as is/are specified immediately below or, if necessary, on an attachment hereto:
Name Address
---- -------
DATE: HOLDER:
