Exhibit 10.4
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933 AND MAY NOT BE TRANSFERRED IN VIOLATION OF SUCH ACT OR THE RULES AND
REGULATIONS THEREUNDER.
WARRANT
TO PURCHASE SHARES OF
MINDARROW SYSTEMS, INC.
COMMON STOCK
XX. 000 XXXX 00, 0000
XxxxXxxxx Systems, Inc., a Delaware corporation (the "COMPANY") hereby
issues to East-West Capital Associates, Inc. (the "HOLDER") this warrant (the
"WARRANT") to purchase from the Company, at any time or from time to time on or
before the third anniversary of the date of this Warrant (or any earlier date
specified by the Company in a written notice given by the Company to the
Holder), for a price per share equal to $0.50, 900,000 shares of common stock of
the Company.
This Warrant is subject to the following terms and conditions:
1. Exercise. The rights represented by this Warrant may be exercised,
at any time or from time to time in whole or in part, by (a) the surrender of
this Warrant, along with the purchase form attached as Exhibit A-1 (the
"PURCHASE FORM"), properly executed, at the address of the Company set forth in
Section 7.2 (or such other address as the Company may designate by notice in
writing to the Holder at its address set forth in Section 7.2) and (b) the
payment to the Company of the exercise price by check, payable to the order of
the Company, for the number of shares specified in the Purchase Form, together
with any applicable stock transfer taxes. A certificate representing the shares
so purchased and, in the event of an exercise of fewer than all the rights
represented by this Warrant, a new warrant in the form of this Warrant shall be
issued in the name of the Holder or its designee(s) and representing a new
warrant to purchase a number of shares equal to the number of shares as to which
this Warrant was theretofore exercisable less the number of shares as to which
this Warrant shall theretofore have been exercised, shall be delivered to the
Holder or such designee(s) as promptly as practicable, but in no event later
than three business days, after this Warrant shall have been so exercised.
2. Adjustment of the Number of Shares. If the Company shall (a) pay a
dividend in common stock or make a distribution in common stock, (b) subdivide
its outstanding common stock, (c) combine its outstanding common stock into a
smaller number of shares of common stock, (d) make a distribution on its common
stock in shares of its capital stock other than common stock, or (e) issue by
reclassification of its common stock, spin-off, split-up, recapitalization,
merger, consolidation or any similar corporate event or arrangement other
securities of the Company, the kind and number of shares of common stock
purchasable upon
exercise of this Warrant shall be adjusted immediately prior to the exercise of
this Warrant so that the Holder shall be entitled to receive the kind and number
of shares or other securities of the Company to which the Holder would have been
entitled to receive after the happening of any of the events described above had
this Warrant been exercised immediately prior to the happening of such event or
the record date with respect to such event.
3. Reservation of Shares. From and after the date of this Warrant, the
Company shall at all times reserve and keep available for issuance upon the
exercise of this Warrant a number of its authorized but unissued shares of
common stock sufficient to permit the exercise in full of this Warrant.
4. Transfer. Subject to applicable law, this Warrant may be transferred
at any time, in whole or in part, to any entity, entities, person or persons.
Any transfer shall be effected by the surrender of this Warrant, along with the
form of assignment attached as Exhibit A-2, properly executed, at the address of
the Company set forth in Section 7.2 (or such other address as the Company may
designate by notice in writing to the Holder at its address set forth in Section
7.2). Thereupon, the Company shall issue in the name or names specified by the
Holder a new warrant or warrants of like tenor and representing a warrant or
warrants to purchase in the aggregate a number of shares equal to the number of
shares to which this Warrant was theretofore exercisable less the number of
shares as to which this Warrant shall theretofore have been exercised.
5. Payment of Taxes. The Company shall cause all shares of common stock
issued upon the exercise of this Warrant to be validly issued, fully paid and
nonassessable and not subject to preemptive rights. The Company shall pay all
expenses in connection with, and all taxes and other governmental charges that
may be imposed with respect to, the issuance or delivery of the shares of common
stock upon exercise of this Warrant, unless such tax or charge is imposed by law
upon the Holder.
6. Registration Rights. This Warrant has the benefit of the
registration rights provided by the Company pursuant to the Registration Rights
Agreement dated as of the date hereof.
7. Miscellaneous.
7.1 Securities Act Restrictions. The Holder acknowledges that this
Warrant may not be sold, transferred or otherwise disposed of without
registration under the Securities Act of 1933 (the "SECURITIES ACT") or an
applicable exemption from the registration requirements of the Securities Act
and, accordingly, this Warrant and all certificates representing the common
stock and any other securities issuable upon the exercise of this Warrant shall
bear a legend in the form set forth on the top of page one of this Warrant.
7.2 Notices. All notices and other communications under this
agreement shall be in writing and may be given by any of the following methods:
(a) personal delivery; (b) facsimile transmission; (c) registered or certified
mail, postage prepaid, return receipt requested; or (d) overnight delivery
service. Notices shall be sent to the appropriate party at its, his or her
address or facsimile number given below (or at such other address or facsimile
number for that party as shall be specified by notice given under this Section
7.2):
if to the Holder, to it at:
East-West Capital Associates, Inc.
00000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxxxxx
Fax: (000) 000-0000
with a copy to:
Buchalter, Nemer, Fields & Younger
000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxx
Fax: (000) 000-0000
if to the Company, to it at:
MindArrow Systems, Inc.
0000 Xxxx Xxxxxx
Xxxxx 000
Xxxxxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx Xxxxxx, CEO
Fax: (000) 000-0000
All such notices and communications shall be deemed received upon (a) actual
receipt by the addressee, (b) actual delivery to the appropriate address or (c)
in the case of a facsimile transmission, upon transmission by the sender and
issuance by the transmitting machine of a confirmation slip confirming that the
number of pages constituting the notice have been transmitted without error. In
the case of notices sent by facsimile transmission, the sender shall
contemporaneously mail a copy of the notice to the addressee at the address
provided for above. However, such mailing shall in no way alter the time at
which the facsimile notice is deemed received.
7.3 Amendment. This Warrant may be modified or amended or the
provisions of this Warrant may be waived only with the written consent of the
Company and the Holder.
7.4 Mutilated or Missing Warrant. In case this Warrant shall be
mutilated, lost, stolen or destroyed, the company shall, as soon as practicable
upon receiving notice of such event, issue, in exchange and substitution for and
upon cancellation of the mutilated Warrant, or in lieu of and substitution for
the Warrant lost, stolen or destroyed, a new warrant of like tenor and
representing a warrant to purchase in the aggregate a number of shares equal to
the number of shares to which this Warrant was previously exercisable, but only
upon receipt of evidence reasonably satisfactory to the Company of such loss,
theft or destruction of such Warrant and
indemnity, if requested, also reasonably satisfactory to it or, in the case of
any such mutilation, upon surrender and cessation of such Warrant. Applicants
for such substitute Warrant shall also comply with such other reasonable
requests and pay such other reasonable charges as the Company may prescribe.
7.5 Governing Law. This Warrant shall be governed by the law of
the State of Delaware, without regard to the provisions thereof relating to
conflicts of laws.
______________, 2002
MINDARROW SYSTEMS, INC.
By: ___________________________________
Xxxxxx Xxxxxx,
CEO
EXHIBIT A-1
PURCHASE FORM
[To be executed only upon exercise of warrant]
The undersigned registered owner of this warrant irrevocably exercises
this warrant for the purchase of ________________ shares of common stock of
MindArrow Systems, Inc. and herewith makes payment therefor, all at the price
and on the terms and conditions specified in this warrant and requests that
certificates for the shares of common stock hereby purchased be issued in the
name of and delivered to _________________________________ whose address is
________________________________________________________ and, if such shares of
common stock shall not include all of the shares of common stock issuable as
provided in this warrant, that a new warrant of like tenor and date for the
balance of the shares of common stock issuable hereunder be delivered to the
undersigned.
Dated: _________________________
__________________________________________
(Name of Registered Owner)
__________________________________________
(Signature of Registered Owner)
__________________________________________
(Street Address)
__________________________________________
(City) (State) (Zip Code)
EXHIBIT A-2
ASSIGNMENT FORM
FOR VALUE RECEIVED, the undersigned registered owner of this warrant
hereby sells, assigns and transfers to the assignee named below all of the
rights of the undersigned under this warrant with respect to the number of
shares of common stock set forth below:
No. of shares
Name and Address of Assignee Common Stock
____________________________ ____________
and does hereby irrevocably constitute and appoint ____________________________
attorney-in-fact to register such transfer on the books of MindArrow Systems,
Inc. maintained for the purpose, with full power of substitution in the
premises.
Dated: __________________ Print Name:__________________________________
Signature:___________________________________
Witness:_____________________________________