STOCK PURCHASE WARRANT To Purchase Shares of Common Stock of International Microcomputer Software, Inc.
Exhibit
10.10
To
Purchase Shares of Common Stock of
International
Microcomputer Software, Inc.
THIS
CERTIFIES that, for value received,
__________,
The
Holder, or Xxxxxx’s transferee (the "Holder"), is entitled, upon the terms and
subject to the conditions set forth herein, at any time on or after the date
of
this Warrant and on or before, but in no case after, five (5) years from the
date of this Warrant, to subscribe for and purchase, from International
Microcomputer Software, Inc., a California corporation (the "Company"), shares
of the Company's Common Stock.
This
Warrant is issued in connection with certain Agreement(s) (the "Agreement"),
a
form of which is attached hereto as Exhibit A and incorporated herein by this
reference.
1. Number
of Warrant Shares and Vesting.
This
Warrant entitles the Holder to purchase up to the number of shares of the Common
Stock of Company equal to ____________ shares of Common Stock sold pursuant
to
the Agreements. The Warrants shall vest as follows: __________.
2.
Exercise
Price.
The
purchase price is the closing price of the Common Stock of the Company on
__________, which was $_____.
3. Exercise
of Warrant.
The
purchase rights represented by this Warrant are exercisable by the Holder,
in whole or in part, at any time on or after the date of this Warrant and
on or before five (5) years from the date of this Warrant, by the surrender
of
this Warrant, a Notice of Exercise in the form attached as Exhibit B. If no
registration statement is then in effect with respect to shares issuable on
exercise of this warrant, the Investment Representation Certificate in the
form
attached as Exhibit C duly executed at the office of the Company in Novato,
California (or such other office or agency of the Company as it may designate
by
notice in writing to the Holder at the address of such Holder appearing on
the
books of the Company), and upon payment of the purchase price of the shares
thereby purchased (by cash or by check or bank draft payable to the order of
the
Company or by cancellation of indebtedness of the Company to the Holder, if
any,
at the time of exercise in an amount equal to the purchase price of the shares
thereby purchased); whereupon the Holder shall be entitled to receive a
certificate for the number of shares of Common Stock so purchased.
1
4. Conversion
of Warrant (Cashless Exercise).
In lieu of exercising this Warrant as described in Section 3, the registered
holder hereof shall have the right to convert this warrant, in whole or in
part,
by surrender of this Warrant and a Notice of Conversion in the form attached
as
Exhibit D duly executed at the office of the Company, into shares of Common
Stock of the Company, as provided in this Section 4. Upon exercise of this
conversion right, the holder hereof shall be entitled to receive that number
of
shares of Common Stock of the Company equal to the quotient obtained by dividing
[(A - B)(X)] by (A), where:
A
= the Fair Market Value (as defined below) of one share of Common Stock on
the
date of conversion of this Warrant.
B
= the purchase price for one share of Common Stock under this
Warrant.
X
= the number of shares of Common Stock as to which this Warrant is being
converted.
If
the above calculation results in a negative number, then no shares of Common
Stock shall be issued or issuable upon conversion of this
Warrant.
"Fair
Market Value" of a share of Common Stock shall be the average closing price
of
such stock on the ten (10) trading days immediately preceding the date as of
which such value is to be determined.
5. Restrictions
on Transfer.
(a) Permitted
Transfers.
This
Warrant shall be freely transferable in whole or in part, subject to the
limitations specified in this Section 5, provided that any such transfer
shall be for not less than 10% of the amount of this Warrant.
(b) Investment
Representation.
The
Holder agrees that the Holder will not offer, sell or otherwise dispose of
this
Warrant or any securities issued on exercise of this Warrant except under
circumstances which will not result in a violation of the Securities Act. Unless
a registration statement is in effect, then upon exercise of this Warrant,
the
Holder shall confirm in writing, by executing the form attached as
Exhibit C hereto, that the securities purchased thereby are being acquired
for investment solely for the Holder's own account and not as a nominee for
any
other Person, and not with a view toward distribution or resale.
2
(c) Disposition
of Warrant or Shares.
With
respect to any offer, sale or other disposition of this Warrant or any
securities issued upon exercise of this Warrant, the Holder agrees to give
written notice to the Company prior thereto, describing briefly the manner
thereof, together with a written opinion of the Holder's counsel, if reasonably
requested by the Company, to the effect that such offer, sale or other
disposition may be effected without registration under the Securities Act or
qualification under any applicable state securities laws of this Warrant or
such
shares, as the case may be, and indicating whether or not under the Securities
Act certificates for this Warrant or such shares, as the case may be, to be
sold
or otherwise disposed of require any restrictive legend as to applicable
restrictions on transferability in order to insure compliance with the
Securities Act. Each certificate representing this Warrant or the securities
thus transferred (except a transfer pursuant to Rule 144) shall bear a
legend as to the applicable restrictions on transferability in order to insure
compliance with the Securities Act, unless in the aforesaid reasonably
satisfactory opinion of counsel for the Holder or the security holder, as the
case may be, such legend is not necessary in order to insure compliance with
the
Securities Act. The Company may issue stop transfer instructions to its transfer
agent in connection with such restrictions.
In
the
event Xxxxxx seeks an opinion from Xxxxxx's counsel as to transfer without
registration, the Company shall provide such factual information to Xxxxxx's
counsel as Xxxxxx's counsel may reasonably request for the purpose of rendering
such opinion and such counsel may rely on the accuracy and completeness of
such
information in rendering such opinion.
(d) Procedure.
Subject
to the limitations set forth in this Section 5, Xxxxxx may transfer the
Warrant on the books of the Company by surrendering to the Company:
(i) this Warrant; (ii) a written Assignment, in the form attached as
Exhibit E, naming the assignee and duly executed by Xxxxxx; and
(iii) funds sufficient to pay any stock transfer taxes payable upon the
making of such transfer.
The
company shall thereupon execute and deliver a new Warrant in the name of the
assignee specified in such instrument of assignment, and if the Warrant is
transferred in part, the Company shall also execute and deliver in the name
of
the Holder a new Warrant covering the untransferred portion of the Warrant.
Upon
issuance of the new Warrant or Warrants, the Warrant surrendered for transfer
shall be canceled by the Company.
(e) Expenses.
The
Company shall pay all expenses, and other charges payable in connection with
the
preparation, issue, and delivery of any new Warrant under this
Section 5.
6. No
Rights as Shareholder.
This
Warrant does not entitle the Holder to any voting rights or other rights as
a
shareholder of the Company prior to exercise.
7.
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.
3
8. Saturdays,
Sundays, Holidays, etc.
If the
last or appointed day for the taking of any action or the expiration of any
right required or granted herein shall be a Saturday or a Sunday or shall be
a
legal holiday, then such action may be taken or such right may be exercised
on
the next succeeding day not a legal holiday.
9. Miscellaneous.
This
Warrant may be amended and any term of this Warrant may be waived only by a
written instrument signed by the Company and the Holder. This Warrant shall
be
binding upon any successors or assigns of the Company. This Warrant shall
constitute a contract under the laws of the State of California and for all
purposes shall be construed in accordance with and governed by the laws of
said
state applied without reference to conflict of laws principles.
Dated:
INTERNATIONAL
MICROCOMPUTER
SOFTWARE,
INC.
___________________________________
By:
4
EXHIBIT
A
RELATED
AGREEMENT(S)
EXHIBIT
B
NOTICE
OF EXERCISE
TO: International
Microcomputer Software, Inc.
The
undersigned hereby elects to purchase _______________ shares of Common Stock
of
International Microcomputer Software, Inc. pursuant to the terms of the attached
Warrant, and tenders herewith payment of the purchase price in full, together
with all applicable transfer taxes, if any.
(1) Please
issue a certificate or certificates representing said shares of Common Stock
in
the name of the undersigned.
(2) The
undersigned represents that the aforesaid shares of Common Stock are being
acquired for the account of the undersigned for investment.
|
|
|
(Date)
EXHIBIT
C
INVESTMENT
REPRESENTATION CERTIFICATE
HOLDER:
| COMPANY: |
INTERNATIONAL
MICROCOMPUTER SOFTWARE, INC.
|
| SECURITY: |
COMMON
STOCK
|
AMOUNT:
DATE:
In
connection with the purchase of the above-listed Securities, the undersigned
Holder represents to the Company the following:
(a) Xxxxxx
is
aware of the Company's business affairs and financial condition and has acquired
sufficient information about the Company to reach an informed and knowledgeable
decision to acquire the Securities. Holder is acquiring these Securities for
investment for Xxxxxx's own account only and not with a view to, or for resale
in connection with, any "distribution" thereof within the meaning of the
Securities Act of 1933, as amended (the "Securities Act").
(b) Holder
acknowledges and understands that the Securities constitute "restricted
securities" under the Securities Act and have not been registered under the
Securities Act in reliance upon a specific exemption therefrom, which exemption
depends upon, among other things, the bona fide nature of Xxxxxx's investment
intent as expressed herein. In this connection, Xxxxxx understands that, in
the
view of the Securities and Exchange Commission, the statutory basis for such
exemption may be unavailable if Xxxxxx's representation was predicated solely
upon a present intention to hold these Securities for the minimum capital gains
period specified under tax statutes, for a deferred sale, for or until an
increase or decrease in the market price of the Securities, or for a period
of
one year or any other fixed period in the future. Holder further understands
that the Securities must be held indefinitely unless they are subsequently
registered under the Securities Act or an exemption from such registration
is
available. Xxxxxx understands that the certificate evidencing the Securities
will be imprinted with a legend which prohibits the transfer of the Securities
unless they are registered or such registration is not required in the opinion
of counsel satisfactory to the Company.
(c) Holder
is
familiar with the provisions of Rule 144, promulgated under the Securities
Act, which, in substance, permit limited public resale of "restricted
securities" acquired, directly or indirectly from the issuer thereof, in a
non-public offering subject to the satisfaction of certain
conditions.
The
Securities may be resold in certain limited circumstances subject to the
provisions of Rule 144, which requires the resale to occur not less
than one year after the later of the date the Securities were sold by the
Company or the date the Securities were sold by an affiliate of the Company,
within the meaning of Rule 144; and, in the case of acquisition of the
Securities by an affiliate, or by a non-affiliate who subsequently holds the
Securities less than two years, the satisfaction of certain conditions of
Section 13 or 15(d) of the Securities Exchange Act of 1934,
ninety (90) days thereafter (or such longer period as any market stand-off
agreement may require) the Securities may be resold, subject to the satisfaction
of certain of the conditions specified by Rule 144, including: (1) the
resale being made through a broker in an unsolicited "broker's transaction"
or
in transactions directly with a market maker (as said term is defined under
the Securities Exchange Act of 1934); and, in the case of an affiliate,
(2) the availability of certain public information about the Company,
(3) the amount of Securities being sold during any three month period not
exceeding the limitations specified in Rule 144, and (4) the timely
filing of a Form 144, if applicable.
(d) Holder
further understands that in the event all of the applicable requirements of
or
144 are not satisfied, registration under the Securities Act, compliance with
Regulation A, or some other registration exemption will be required; and that,
notwithstanding the fact that Rule 144 is not exclusive, the Staff of the
Securities and Exchange Commission has expressed its opinion that persons
proposing to sell private placement securities other than in a registered
offering and otherwise than pursuant to Rule 144 will have a substantial burden
of proof in establishing that an exemption from registration is available for
such offers or sales, and that such persons and their respective brokers who
participate in such transactions do so at their own risk. Holder understands
that no assurances can be given that any such other registration exemption
will
be available in such event.
Signature
of Holder:
___________________________
Date:___________________________
2
EXHIBIT
D
NOTICE
OF CONVERSION
To:
International Microcomputer Software, Inc.
(1)
The
undersigned hereby elects to convert that portion of the attached Warrant
representing the right to purchase [____________________]
shares
of Common Stock of the Company into such number of shares of Common Stock of
the
Company as is determined pursuant to Section 4 of such Warrant, which conversion
shall be effected pursuant to the terms of the attached Warrant.
(2) Please
issue a certificate or certificates representing said shares in the name of
the
undersigned or in such other name as is specified below:
(Name):
(Address):
(3) The
undersigned represents that the aforesaid shares of Common Stock of the Company
are being acquired for the account of the undersigned for investment and not
with a view to, or for resale in connection with, the distribution thereof
and
that the undersigned has no present intention of distributing or reselling
such
shares.
(Date) (Signature)
EXHIBIT
E
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sells, assigns and transfers unto [Name
and Address]
the
rights represented by the foregoing Common Stock Warrant issued by International
Microcomputer Software, Inc., on [date], and appoints ________________ its
attorney to transfer said rights on the books of said corporation, with full
power of substitution in the premises.
_______________________________
Signature
guaranteed:
Dated:
_________________
