EXHIBIT 10.11
THIS WARRANT, AND THE SECURITIES ISSUABLE UPON THE EXERCISE OF THIS WARRANT,
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AS AMENDED
("SECURITIES ACT"), AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF
(i) UNLESS THE SHARES ARE REGISTERED UNDER THE SECURITIES ACT AND THE SECURITIES
ACT OF ANY STATE APPLICABLE TO SUCH SALE, OR (ii) THE PROPOSED SELLER PROVIDES
THE COMPANY WITH AN OPINION OF COUNSEL THAT THE SECURITIES ARE BEING SOLD IN A
TRANSACTION WHICH IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT AND ANY APPLICABLE STATE SECURITIES ACTS AND THE COMPANY IS SATISFIED THAT
NO REGISTRATION STATEMENT IS THEN REQUIRED AND THAT THIS WARRANT AND THE
UNDERLYING SECURITIES MAY BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF IN THE
MANNER CONTEMPLATED WITHOUT REGISTRATION UNDER THE SECURITIES ACT OR ANY STATE
SECURITIES ACT.
WARRANT TO PURCHASE SHARES
OF COMMON STOCK OF
INVU, INC.
Warrant to Purchase
VOID AFTER 5:00 P.M.
[3rd anniversary of issue date]
FOR VALUE RECEIVED, Invu, Inc., a corporation organized under the laws
of Colorado (the "Company"), promises to issue in the name of, and sell and
deliver to Xxxxxx Xxxxxxxx, Apt. B42, Roc Fleuri, 0 Xxx Xx Xxxxx, XX 00000
Xxxxxx (the "Holder"), a certificate or certificates for an aggregate of 200,000
shares (the "Shares") of common stock, of the Company ("Common Stock") par value
$.01 per share, at any time [after the issue date], and prior to 5:00 P.M.,
London, England Time [and on or before the third anniversary of the issue date
of this Warrant] (the "Expiration Date"), upon payment therefor of $0.50 per
share in lawful funds of the United States of America (the "Basic Exercise
Price") or pursuant to an alternative means of exercise detailed in Section 1 of
this Warrant. This applicable Basic Exercise Price, until such adjustment is
made and thereafter as adjusted from time to time, is called the "Exercise
Price."
1. Exercise of Warrant. In case the Holder of this Warrant shall desire
to exercise this Warrant in whole or in part, the Holder may either: (i)
surrender this Warrant, with the form of exercise notice on the last page hereof
duly executed by the Holder, to the Company accompanied by payment of the
Exercise Price of $0.50 per share, subject to adjustment as noted herein, or
(ii) in lieu of a cash exercise of this Warrant, the Holder may elect to receive
Common Stock equal to the value of this Warrant (or the portion hereof being
canceled) by surrender of this Warrant at the principal office of the Company
together with notice of such election, in which event the Company shall issue to
the Holder a number of shares of the Common Stock computed using the following
formula:
X = Y (A-B)
-------
A
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Where X = the number of shares of Common Stock to be issued to
the Holder
Y = the number of shares of Common Stock purchasable
under this Warrant
A = the fair market ("Fair Market Value") value of one
share of the Common Stock
B = the Exercise Price
For purposes of this Section 1, if shares Common Stock are listed on a national
stock exchange or the NASDAQ Stock Market, the Fair Market Value per share of
the Common Stock shall be deemed to be the closing price of the Common Stock for
the Measuring Period (as hereinafter defined). However, if the shares of Common
Stock are then publicly traded but not quoted on a national stock exchange or
the NASDAQ Stock Market, the Fair Market Value per share of the Common Stock
shall be the mean of the closing bid and ask price of the Common Stock for the
Measuring Period. If the Common Stock is not publicly traded, the Fair Market
Value per share of Common stock shall be determined by the Board of Directors of
the Company in its reasonable discretion.
The Measuring Period shall be the ten (10) consecutive trading days
prior to the date of the exercise of the Warrants.
2. Registration Rights.
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(a) If the Company at any time proposes to file a registration
statement to register any of its securities under the Securities Act (except for
a registration filed in connection with an employee benefit plan, a transaction
relating to a merger or business combination, a transaction relating to an
exchange offer, a transaction relating to an acquisition of assets or
securities, or a transaction otherwise described in Rule 145 of the Securities
Act), whether or not for sale for its own account, it will each such time give
prompt written notice to the Holder of its intention to do so. Upon the written
request of a Holder, which request shall specify the number of the Shares
intended to be disposed of by the Holder, made as promptly as practicable and in
any event within ten (10) days after the receipt of any such notice, the Company
will use reasonable efforts to effect the registration under the Securities Act
of all the Shares that the Company has been so requested to register by the
Holder (a "Piggy-Back Registration").
(b) If the managing underwriter of any underwritten offering shall
deliver a written statement to the Holder that in such underwriter's opinion the
total number of Shares requested to be included in such registration would have
a material adverse effect on such offering, then the Company will include in
such registration only such number of shares of Common Stock that the Company is
so advised can be sold in (or during the time of) such offering without having a
material adverse effect on such offering, first, all securities proposed by the
Company to be sold for its own account and shares proposed to be sold by persons
with demand registration rights and second, the Shares requested to be included
in such registration by the Holder pursuant to this Agreement and other holders
with piggy-back registration rights.
(c) The Company shall not be obligated to include any Shares in any
registration statement filed for the benefit of any person or entity other than
the Company or the Holder wherein rights granted by the Company prohibit such
inclusion.
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3. Stock Dividends; Reclassification; Reorganizations; Anti-Dilution
Provisions. This Warrant is subject to the following further provisions:
a. In case, prior to the expiration of this Warrant by
exercise or by its terms, the Company shall issue any shares of its
Common Stock as a stock dividend or subdivide the number of outstanding
shares of Common Stock into a greater number of shares, then in such
case, the number of shares of Common Stock issuable upon exercise of
this Warrant shall be proportionately increased and the Exercise Price
shall be proportionately decreased, and conversely, in the event the
Company shall contract the number of outstanding shares of Common Stock
by combining such shares of Common Stock into a smaller number of
shares of Common Stock then, in such case the number of shares of
Common Stock issuable upon exercise of this Warrant shall be
proportionately decreased and the Exercise Price shall be
proportionately increased. If the Company shall, at any time during the
life of this Warrant, declare a dividend payable in cash on its Common
Stock and shall at substantially the same time offer to its
stockholders generally a right to purchase new shares of Common Stock
from the proceeds of such dividend or for an amount substantially equal
to the dividend, all shares of Common Stock so issued shall for the
purpose of this Warrant be deemed to have been issued as a stock
dividend. Any dividend paid or distributed upon the Common Stock in
shares of any other class of securities convertible into shares of
Common Stock or any other securities shall be treated as a dividend
paid in Common Stock to the extent that shares of Common Stock are
issuable upon the conversion thereof.
b. For purpose of this Agreement, the term "Common Stock"
shall mean (i) the class of stock designated as Common Stock in the
Articles of Incorporation of the Company as such Articles of
Incorporation may be amended after the date hereof or (ii) any other
class of stock resulting from successive changes or reclassifications
of such Common Stock consisting solely of changes in par value, or from
par value to no par value, or from no par value to par value.
c. In case of any consolidation of the Company with, or merger
of the Company with, or merger of the Company into, another corporation
(other than a consolidation or merger that does not result in any
reclassification or change of the outstanding Common Stock covered by
Section 3(b) hereof), the corporation formed by such consolidation or
merger shall execute and deliver to the Holder a supplemental warrant
agreement providing that the Holder of each Warrant then outstanding or
to be outstanding shall have the right thereafter (until the expiration
of such Warrant) to receive, upon exercise of such warrant, the kind
and amount of shares of stock and other securities and property
receivable upon such consolidation or merger, by a Holder of the number
of shares of Common Stock of the Company for which such Warrant might
have been exercised immediately prior to such consolidation or merger.
Such supplemental warrant agreement shall provide for adjustments that
shall be identical to the adjustments provided in the Section 3. The
above provision of this Subsection shall similarly apply to successive
consolidations or mergers.
d. Upon the occurrence of each event requiring an adjustment
of the Exercise Price or of the number of shares of Common Stock
issuable upon exercise of this Warrant in accordance with, and as
required by, the terms of this Section 3, the Company shall use its
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best efforts to forthwith cause either a firm of independent certified
public accountants (who may be the regular accountants for the Company)
or the Chief Financial Officer of the Company to compute the adjusted
Exercise Price or the adjusted number of shares of Common Stock
issuable upon exercise of this Warrant by reason of such event in
accordance with the provisions of this Section 3. The Company shall
forthwith mail to the Holder of this Warrant a copy of such
computation, which shall be conclusive and shall be binding upon such
Holder unless contested by such Holder by written notice to the Company
within 14 days after the mailing thereof by the Company.
e. In case,
(1) the Company shall make a record of the holders of
its Common Stock for the purpose of entitling them to receive
a dividend payable (whether payable in cash, securities,
property or in any other form); or
(2) the Company shall make a record of the holders of
its Common Stock for the purpose of entitling them to
subscribe for or purchase any shares of any class or to
receive any other rights; or
(3) the Company shall set a date for any
reclassification or other reorganization of the capital stock
of the Company, consolidation or merger of the Company with or
into another corporation, or conveyance of all or
substantially all of the assets of the Company; or
(4) the Company shall set a date for the voluntary or
involuntary dissolution, liquidation or winding up of the
Company:
then, in any such case, the Company shall mail to the Holder of this
Warrant at least 10 days prior to such record date or the date set for
any actions described in subparagraphs (d)(1) through (d)(3) above, a
notice advising such Holder of the date or expected date on which a
record is to be taken for the purpose of such dividend, distribution of
rights or the date on which such reclassification, reorganization,
consolidation, merger, conveyance, dissolution, liquidation or winding
up is to take place, as the case may be. Such notice shall also specify
the date or expected date, if any is to be fixed, as of which holders
of Common Stock of record shall be entitled to participate in said
dividend, distribution of rights, or shall be entitled to exchange
their shares of Common Stock for securities or other property
deliverable upon such reclassification, reorganization, consolidation,
merger, conveyance, dissolution, liquidation or winding up, as the case
may be. Each such written notice shall be given by certified mail,
postage prepaid, return receipt requested, addressed to the holder of
the Warrant at the address of such holder as shown on the books of the
Company.
f. In case the Company, at any time while this Warrant shall
remain valid and unexercised, dissolve, liquidate or wind up its
affairs or sell or dispose of all or substantially all of its assets,
securities or property, the Holder of this Warrant shall thereafter be
entitled to receive upon exercise hereof (in lieu of such shares of
Common Stock underlying this Warrant) and the same kind and amount of
any securities or assets as may be issuable,
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distributable or payable upon any such sale, dissolution, liquidation
or winding up with respect to such number of shares of Common Stock of
the Company as would otherwise have been issuable upon exercise of this
Warrant. The Company shall mail notice thereof by registered mail to
the Holder and shall make no distribution to the stockholders of the
Company until the expiration of ten (10) days from the date of such
mailing; provided, however, that in any such event if the Holder shall
not exercise this Warrant within ten (10) days from the date of mailing
such notice, all rights herein granted not so exercised within such ten
(10) day period shall thereafter become null and void. The Company
shall not, however, be prevented from consummating any such sale
without awaiting the expiration of such ten (10) day period, it being
the intent and purpose hereof to enable the Holder upon exercise of
this Warrant to participate in the distribution of the consideration to
be received by the Company upon any such sale or in the distribution of
assets upon any dissolution or liquidation of the Company.
g. The provisions of this Section 3 are for the purpose of,
and shall be to the effect that upon any exercise of this Warrant the
Holder shall be entitled to receive the same amount and kind of
securities and other property that it would have been entitled to
receive as the owner at all times subsequent to the date hereof the
number of shares of Common Stock issuable upon exercise of the Warrant.
h. The Company shall at all times reserve and keep available,
out of its authorized and unissued capital stock, solely for the
purpose of providing for the exercise, forthwith upon the request of
the Holder of the Warrant(s) then outstanding and in effect, such
numbers of shares of Common Stock as shall, from time to time, be
sufficient for the Shares upon such exercise of the Warrants. The
Company shall, from time to time, in accordance with the laws of the
State of Colorado, increase the authorized amount of its capital stock,
if at any time the number of shares of Common Stock remaining unissued
and unreserved for other purposes shall not be sufficient to permit the
exercise of all Warrants then outstanding and in effect.
i. The Company covenants and agrees that all Shares that may
be issued upon the exercise of the rights represented by this Warrant
will, upon issuance, be validly issued, fully paid and non-assessable,
and free from all taxes, liens and charges with respect to the issue
thereof (other than taxes in respect of any transfer occurring with
such issue). The Company further covenants and agrees that, during the
period within which the rights represented by this Warrant may be
exercised, the Company will at all times have authorized and reserved a
sufficient number of shares of its Common Stock to provide for the
exercise of the rights represented by this Warrant.
4. Loss, Theft, Destruction or Mutilation. In case this Warrant shall
become mutilated or defaced or be destroyed, lost or stolen, the Company shall
execute and deliver a new Warrant in exchange for and upon surrender and
cancellation of such mutilated or defaced Warrant or in lieu of and substitution
of such Warrant so destroyed, lost or stolen, upon the Holder of such Warrant
filing the Company such evidence satisfactory to it that such Warrant has been
so mutilated, defaced, destroyed, lost or stolen and of the ownership thereof by
the Holder; provided, however, that the Company shall be entitled, as a
condition to the execution and delivery of such new Warrant, to
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demand indemnity satisfactory to it and payment of expenses and charges incurred
in connection with the delivery of such new Warrant, except that no bond shall
be required from the Holder. All Warrants so surrendered to the Company shall be
canceled.
5. Record Owner. At the time of the surrender of this Warrant, together
with the form of subscription properly executed and payment of the Exercise
Price, the person exercising this Warrant shall be deemed to be the Holder of
record of the shares of Common Stock deliverable upon such exercise, in whole,
or in part, notwithstanding that the stock transfer of the Company shall then be
closed or that certificates representing such shares of Common Stock shall not
then be actually delivered to such person. The Company will pay all costs with
respect to the issuance of this Warrant or the shares of Common Stock issuable
upon exercise hereof, or thereof.
6. Fractional Shares. No fractional Shares, fractional shares or scrip
representing fractional shares of Common Stock shall be issued upon the exercise
of this Warrant. With respect to any fraction of a Share called for on such
exercise, the Holder may elect to receive, and the Company shall pay to the
Holder, an amount in cash equal to such fraction multiplied by the Exercise
Price. In the alternative, the Holder may elect to remit to the Company an
amount in cash equal to the difference between such fraction and one, multiplied
by the Exercise Price, and the Company will issue the Holder one share of Common
Stock in addition to the number of whole shares required by the exercise of the
Warrant; provided, however, that the Company shall not be obligated by the
operation of this Section 6 to issue Shares in the aggregate exceeding the
number of shares duly registered in accordance with the applicable federal and
state securities laws or as to which an exemption from registration has been
determined to be available.
7. Original Issue Taxes. The Company will pay all United States, state
and local (but not foreign) original issue taxes, if any, upon the issuance of
this Warrant or the Shares deliverable upon exercise hereof.
8. Mailing of Notices, etc. All notices, and other communications from
the Company to the Holder of this Warrant shall be mailed by first-class
registered or certified mail, return receipt requested, postage prepaid, to the
Holder, at the address set forth in the records of the Company, or to such other
address furnished to the Company in writing from time to time by the Holder of
this Warrant. All notices from the Holder of this Warrant to the Company shall
be mailed to the Company at Invu, Inc., The Beren, Blisworth Xxxx Xxxx, Xxxxx
Xxxx, Xxxxxxxxx, Xxxxxxxxxxxxxxxx XX00XX, Xxxxxx Xxxxxxx, Attn: Xxxxx Xxxxxx,
President.
9. Registration Under the Securities Act of 1933. This Warrant and the
Shares issuable upon exercise of this Warrant have not been registered under the
Securities Act or the securities acts of any state or foreign country by virtue
of the Registration Statement. This Warrant and all replacement Warrants and all
Shares issued upon exercise of the Warrant shall bear the following legend:
This Warrant, and the securities issuable upon the exercise of
this Warrant, have not been registered under the Securities
Act of 1933, as amended ("Securities Act"), and may not be
sold, transferred or otherwise disposed of unless (i) the
Shares are registered under the
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Securities Act and the securities act of any state applicable
to such sale, or (ii) the proposed seller provides the Company
with an opinion of counsel that the securities are being sold
in a transaction which is exempt from the registration
requirements of the Securities Act and any applicable state
securities acts and the Company is satisfied that no
registration statement is then required and that this Warrant
and the underlying securities may be sold, transferred or
otherwise disposed of in the manner contemplated without
registration under the Securities Act or any state securities
act.
10. Laws of the State of Colorado. This Warrant shall be governed by,
interpreted under and construed in all respects in accordance with the laws of
the State of Colorado, irrespective of the place of domicile or residence of any
party.
11. Entire Agreement and Modification. The Company and the Holder of
this Warrant hereby represent and warrant that this Warrant is intended to and
does contain and embody all of the understandings and agreements, both written
and oral, of the parties hereto with respect to the subject matter of this
Warrant, and that there exists no oral agreement or understanding, express or
implied, whereby the absolute, final and unconditional character or nature of
this Warrant be in any way invalidated or affected. A modification or waiver of
any of the terms, conditions or provisions of this Warrant shall be effective
only if made in writing and executed with the same formality as this Warrant.
This Warrant will become wholly void and of no effect and the rights
evidenced hereby will terminate unless exercised in accordance with the terms
and provision hereof at or before 5:00 P.M., London Time, on the Expiration
Date.
[Remainder of Page Intentionally Blank]
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IN WITNESS WHEREOF, the Company by its duty authorized officer has
executed this Warrant as of the ______ day of ________________, 1999.
Attest: Invu, Inc.
By:
-----------------------------------
Xxxxx Xxxxxx, President
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FORM OF EXERCISE
The undersigned hereby irrevocably elects to exercise the purchase
rights represented by this Warrant for, and to purchase thereunder, ___________
Shares of Invu, Inc., a Colorado corporation, and herewith (a) opts to makes
payment of $0.50 per share, at a total of $__________ therefor, or (b) requests
that his rights under the Warrant be exercised pursuant to the net exercise
provision of Section 1 of the Warrant, and requests that such Shares be issued
to:
-----------------------------------
(Print Name)
-----------------------------------
(Address)
-----------------------------------
(Taxpayer Identification Number)
Dated: ____________________________ -----------------------------------
(Signature must conform in all
respects to name of holder as
specified on the face of the
Warrant)
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