Exhibit
4.2
THIS
WARRANT AND THE SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
THIS WARRANT AND THE SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED
IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT OR APPLICABLE EXEMPTION OR SAFE HARBOR PROVISION.
COMMON
STOCK PURCHASE WARRANT
GOPHER
PROTOCOL, INC.
| Warrant Shares: 666,666 |
Initial
Issue Date: December 29, 2017 |
Aggregate
Exercise Amount: $1,333,332.00
THIS
COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies that, for value received, Eagle Equities, LLC, or 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 three (3) year anniversary of the Initial Issue Date (as subject to adjustment hereunder, the “Termination
Date”), to subscribe for and purchase from GOPHER PROTOCOL, INC., a Nevada corporation (the “Company”),
up to 666,666 shares (as subject to adjustment herein, the “Warrant Shares”) of common stock of the Company
(the “Common Stock”). The purchase price of one share of Common Stock under this Warrant shall be equal to
the Exercise Price, as defined in Section 1.2.
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. 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 $2.00 per share, subject to adjustment hereunder
(the “Exercise Price”). The aggregate exercise price is $1,333,332.00.
1.3 INTENTIONALLY
DELETED
1.4 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 Holder 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 Holder’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. Holder may assess penalties or
liquidated damages (both referred to herein as “penalties”) as follows. For each exercise, in the event that shares
are not delivered by the third business day (inclusive of the day of exercise), the Company shall pay the Holder in cash a penalty
of $1,000 per day for each day after the third business day (inclusive of the day of exercise) until share delivery is made. The
Company will not be subject to any penalties once its transfer agent correctly processes the shares to the DWAC system. The
Company will make its best efforts to deliver the Warrant Shares to the Holder the same day or next day.
1.5 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 Holder 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.
1.6 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 Holder’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.
1.7 Compensation
for Buy-In on Failure to Timely Deliver Certificates Upon Exercise. In addition to any other rights available to the Holder,
if the Company fails to cause its transfer agent to transmit to the Holder the Warrant Shares on or before the Warrant Share Delivery
Date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise) or
the Holder’s brokerage firm otherwise purchases, shares of Common Stock to deliver in satisfaction of a sale by the Holder
of the Warrant Shares which the Holder anticipated receiving upon such exercise (a “Buy-In”), then the Company
shall (A) pay in cash to the Holder the amount, if any, by which (x) the Holder’s total purchase price (including brokerage
commissions and other fees, if any) for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying
(1) the number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue
times (2) the price at which the sell order giving rise to such purchase obligation was executed, and (B) at the option of the
Holder, either (x) reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not
honored (in which case such exercise shall be deemed rescinded), (y) deliver to the Holder the number of shares of Common Stock
that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder, or (z) pay in
cash to the Holder the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required to deliver
to the Holder in connection with the exercise at issue times (2) the price at which the sell order giving rise to such purchase
obligation was executed. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect
of the Buy-In and, upon request of the Company, evidence of the amount of such loss.
1.8 Make-Whole
for Market Loss after Exercise. At the Holder’s election, if the Company fails for any reason to deliver to the Holder
the Warrant Shares by DWAC/FAST electronic transfer (such as by delivering a physical certificate) and if the Holder incurs a
Market Price Loss, then at any time subsequent to incurring the loss the Holder may provide the Company written notice indicating
the amounts payable to the Holder in respect of the Market Price Loss and the Company must make the Holder whole as follows:
Market
Price Loss = [(High trade price on the day of exercise) x (Number of Warrant Shares)] – [(Sales price realized by Holder)
x (Number of Warrant Shares)]
The
Company must pay the Market Price Loss by cash payment, and any such cash payment must be made by the third business day from
the time of the Holder’s written notice to the Company.
1.9 Make-Whole
for Failure to Deliver Loss. At the Holder’s election, if the Company fails for any reason to deliver to the Holder
the Warrant Shares by the Warrant Share Delivery Date and if the Holder incurs a Failure to Deliver Loss, then at any time the
Holder may provide the Company written notice indicating the amounts payable to the Holder in respect of the Failure to Deliver
Loss and the Company must make the Holder whole as follows:
Failure
to Deliver Loss = [(High trade price at any time on or after the day of exercise) x (Number of Warrant Shares)]
The
Company must pay the Failure to Deliver Loss by cash payment, and any such cash payment must be made by the third business day
from the time of the Holder’s written notice to the Company.
1.10 Choice
of Remedies. Nothing herein, including, but not limited to, Holder’s electing to pursue its rights under Sections 1.8
or 1.9 of this Warrant, shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law or in
equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s
failure to timely deliver shares of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.
1.11 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.
1.12 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 9.9% of the Common Stock
outstanding of the Company (the “Beneficial Ownership Limitation”). Upon the written or oral request of Holder,
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 the Exercise Price is adjusted pursuant to any provision of this Article 2, the Company shall promptly
notify the Holder (by written notice) setting forth the Exercise Price after such adjustment 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.
The Company may not assign this Warrant. 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, Holder has the right
to have any such opinion provided by its counsel. Holder 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. Holder 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 has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first
above indicated.
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GOPHER PROTOCOL, INC. |
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/s/ Xxxxxxx Xxxxx |
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By: |
Xxxxxxx Xxxxx, CEO |
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HOLDER: EAGLE EQUITIES, LLC |
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/s/ Xxxxx Xxxxxxxxxx |
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Xxxxx Xxxxxxxxxx, Manager |
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NOTICE
OF EXERCISE
To: GOPHER
PROTOCOL, INC.
(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.
Payment
shall take the form of lawful money of the United States; or
(2)
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]
