EXHIBIT 10.7
139
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE
HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"), OR THE SECURlTIES LAWS OF ANY STATE. SUCH SECURITIES MAY NOT BE
SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF REGISTRATION UNDER SAID ACT AND ALL OTHER APPLICABLE SECURITIES LAWS,
UNLESS INFORMATION ANALYSIS INCORPORATED RECEIVES A SATISFACTORY OPINION OF
COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.
WARRANT
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WARRANT TO PURCHASE SHARES OF COMMON STOCK
OF INFORMATION ANALYSIS INCORPORATED
Date of Issuance: Feb. 24, 1993
THIS CERTIFIES that, for value received, XXXXX X. XXXXXX, or
registered assigns (the "Holder") is entitled, subject to the provisions of
this Warrant, to purchase from INFORMATION ANALYSIS INCORPORATED, a Virginia
corporation (the "Company"), at the price hereinafter set forth, 12,000 shares
of the Company's S0.01 par value common stock (all of the Company's shares of
Common Stock being hereafter referred to as "Common Stock"). This Warrant is
hereinafter referred to as the "Warrant" and the shares of Common Stock issued
or then issuable pursuant to the terms hereof are hereinafter sometimes
referred to as "Warrant Shares".
Section 1. Exercise of Warrant. This Warrant shall be exercised in
whole or in part at any time and from time to time on or after its date of
issuance but prior to the Expiration Date defined in Section 12 by presentation
of the Purchase Form annexed hereto duly executed and accompanied by payment of
the Exercise Price set forth in Section 7 hereof, for the number of shares
specified in such form. Upon receipt by the Company of the Purchase Form
executed as aforesaid, at the office of the Company, accompanied by payment of
the Exercise Price, the Company shall issue and deliver to the Holder within a
reasonable period of time not to exceed 10 days an additional Purchase Form for
future exercise of this Warrant which on its face shall note the total number of
shares heretofore purchased under this Warrant (including the shares then being
purchased) and a certificate or certificates for the shares of Common Stock then
being issued upon such exercise. If deemed necessary by the Company, such
certificates shall bear restricted legends substantially similar to the legend
appearing on the face of this Warrant.
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Section 2. Reservation of Shares. The Company hereby covenants that at
all times during the term of this Warrant there shall be reserved for issuance
such number of shares of its Common Stock as shall be required to be issued upon
exercise of this Warrant.
Section 3. Fractional Shares. This Warrant may be exercised only for a
whole number of shares of Common Stock, and no fractional shares or scrip
representing fractional shares shall be issuable upon the exercise of this
Warrant.
Section 4. Assignment of Warrant. Subject to applicable securities
laws, the Holder of this Warrant shall have the right to transfer and assign
this Warrant and the right to purchase all (but not less than all) of the shares
issuable hereunder. Upon such transfer or assignment, the Holder shall surrender
this Warrant to the Company with the Assignment Form in the form annexed hereto
duly executed and with funds sufficient to pay any transfer taxes, and the
Company shall cancel this Warrant, and without charge, shall execute and deliver
a new Warrant of like tenor in the name of the assignee entitling such assignee
to all rights and interests of its assignor at the time of assignment of this
Warrant.
Section 5. Loss of Warrant. Upon receipt by the Company of evidence
satisfactory to it of the loss, theft, or destruction of this Warrant, and of
indemnification satisfactory to it, or upon surrender and cancellation of this
Warrant, if mutilated, the Company will execute and deliver a new Warrant of
like tenor and date.
Section 6. Rights of the Holder. No provision of this Warrant shall be
construed as conferring upon the Holder hereof the right to vote, consent,
receive dividends or receive notice other than as herein expressly provided in
respect of meetings of stockholders for the election of directors of the Company
or any other matter whatsoever as a stockholder of the Company. No provision
hereof, in the absence of affirmative action by the Holder hereof to purchase
Warrant Shares, and no enumeration herein of the rights or privileges of the
Holder hereof, shall give rise to any liability of such Holder for the purchase
price of any Warrant Shares or as a stockholder of the Company, whether such
liability is asserted by the Company or by creditors of the Company.
This Warrant and the shares issuable hereunder shall not be sold,
offered for sale, pledged, hypothecated, or otherwise transferred in the absence
of registration under the Securities Act of 1933, as amended, and other
applicable securities laws or the Company's receipt of an opinion of counsel
satisfactory to the Company that such registration is not required.
Section 7. Exercise Price. The purchase price for each share purchased
under this Warrant shall be five dollars (S5.00) per share; provided, however,
that if the Company shall subdivide its outstanding shares of Common Stock by
stock split or stock dividend, the purchase price hereunder shall
proportionately decrease and if the
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Company shall combine its outstanding shares of Common Stock by stock
combination, the purchase price hereunder shall proportionately increase.
Section 8. Adjustment in Number of Warrant Shares. This Warrant shall
upon its issuance be exercisable in accordance with the terms hereof, for 2,000
shares of Common Stock; provided, however, if the Company shall subdivide its
outstanding shares of Common Stock by stock split or stock dividend, the number
of shares of Common Stock issuable hereunder shall proportionately increase, and
if the Company shall combine its outstanding shares of Common Stock by a stock
combination, the number of shares of Common Stock issuable hereunder shall
proportionately decrease.
Section 9. Dissolution or Liquidation. In case the Company shall at
any time prior to the Expiration Date set forth in Section 12 hereof, dissolve,
liquidate or wind up its affairs, the Holder shall be entitled, upon the
exercise of this Warrant in whole or in part and prior to any such distribution
in dissolution or liquidation, to receive on such exercise, in lieu of the
shares of Common Stock which the Holder would have been entitled to receive, the
same kind and amount of assets as would have been distributed or paid to the
Holder upon any such dissolution, liquidation or winding up, with respect to
such shares of Common Stock had the Holder been the holder of record of such
share of Common Stock on the record date for the determination of those holders
of Common Stock entitled to receive any such liquidation distribution.
Section 10. Notices to Warrant Holder. If the Company shall pay any
dividend or make any distribution upon the shares of its Common Stock or (ii)
the Company shall offer to the holders of Common Stock for subscription or
purchase by them any shares of stock of any classes or any other rights, or
(iii) if any capital reorganization of the Company, reclassification of the
Common Stock of the Company, consolidation or merger of the Company with or into
another corporation, or voluntary or involuntary dissolution, liquidation or
winding up of the Company shall be affected, then, in any such case, the Company
shall cause to be delivered to the Holder, a notice of any such actions at the
same time and in the same for that notice thereof is provided, if at all, to the
stockholders of the Company.
Section 11. Reclassification, Reorganization or Merger. In case of any
reclassification, capital reorganization or other change of outstanding shares
of Common Stock of the Company (other than a change in par value, or from par
value to no par value, or from no par value to par value, or as a result of an
issuance of Common Stock by way of dividend or other distribution or of a
subdivision or combination), or in case of any consolidation or merger of the
Company with or into another corporation (other than a merger with a subsidiary
in which merger the Company is the continuing corporation or which does not
result in any reclassification, capital reorganization or other change of
outstanding shares of Common Stock of the class issuable upon exercise of this
Warrant), the Company shall cause effective provision to be made so that the
Holder shall have the right thereafter by exercising this Warrant, to purchase
the kind
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and amount of shares of stock and other securities and property receivable upon
such reclassification, capital reorganization or other change, consolidation or
merger, by a holder of the number of shares of Common Stock which might have
been purchased upon exercise of this Warrant immediately prior to such
reclassification, change, consolidation or merger. Any such provision shall
include provision for adjustments which shall be as nearly equivalent as may be
practicable to the adjustments provided for in this Warrant. The foregoing
provisions of this Section 11 shall similarly apply to successive
reclassifications, capital reorganizations and changes of shares of Common Stock
and to successive consolidations and mergers. In the event that in any such
capital reorganization or reclassification, consolidation or merger, additional
shares of Common Stock shall be issued in exchange, conversion, substitution or
payment, in whole or in part, for or of a security of the Company other than
Common Stock any amount of the consideration received upon the issue thereof
being determined by the Board of Directors of the Company shall be final and
binding on the Holder.
Section 12. Applicable Law. This Warrant shall be construed in
accordance with the laws of the Commonwealth of Virginia.
Section 13. Expiration Date. The Warrant shall terminate on the
Expiration Date and may not be exercised on or after such date. The Expiration
Date shall be ten (10) years from the date of issuance of this Warrant except
this Warrant shall expire one year prior to the Expiration Date as to a number
of Warrant Shares equal to the difference (but not less than zero) between (i)
2,000 and (ii) the number of Warrant Shares issued upon prior exercise(s) of
this Warrant.
INFORMATION ANALYSIS INCORPORATED
Attest:
/s/ Xxxxxxxx Xxxxxxx /s/ Xxxxxx Xxxxxxxxx
------------------------------ ---------------------------------
Secretary By:
------------------------------
Title: President
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ASSIGNMENT FORM
---------------
Dated:_____________________
For value received ____________________________________________________
hereby sells, assigns and transfers unto
Name____________________________________________________________________________
(Please typewrite or print in block letters)
Address_________________________________________________________________________
________________________________________ and appoints _______________________ as
Attorney to transfer said Warrant on the books of the within named Company with
full power of substitution in the premises.
________________________________
Signature
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PURCHASE FORM
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The undersigned hereby irrevocably elects to exercise its right to
purchase _______ shares of the $0.01 par value Common Stock of Information
Analysis Incorporated, such right being pursuant to a Warrant dated ___________,
and as issued to the undersigned by Information Analysis Incorporated, and
remits herewith the sum of $_________ in payment for same in accordance with the
Exercise Price specified in Section 7 of said Warrant.
INSTRUCTIONS FOR REGISTRATION OF STOCK
Name_________________________________________________
(Please typewrite or print in block letters)
Address______________________________________________
Dated:______________________ _____________________
Signature
Shares Heretofore Purchased Under Warrant ___________
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