Attached files
Exhibit 4.2
NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS
CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE
EXERCISABLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY
NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE
ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE
SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN
OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER),
IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED
UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE
144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES
MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR
OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE
SECURITIES.
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Right
to Purchase ___________ shares of Common Stock of Blockchain
Industries, Inc. (subject to adjustment as provided
herein)
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COMMON STOCK PURCHASE WARRANT
No.
Issue Date:
DATE
BLOCKCHAIN INDUSTRIES, INC., a corporation organized under
the laws of the State of Nevada (the “Company”), hereby certifies that,
for value received, [GRANTEE], with an address at
[ADDRESS], or its assigns (the
“Holder”), is
entitled, subject to the terms set forth below, to purchase from
the Company at any time after the Issue Date until 5:00 p.m., E.T.
on the five (5) year anniversary of the Issue Date (the
“Expiration
Date”), up to [SHARES] fully paid and non-assessable
shares of the Company’s common stock, par value $0.001 per
share (the “Common Stock”) at a per share purchase
price of $______. The aforedescribed purchase price per share, as
adjusted from time to time as herein provided, is referred to
herein as the “Purchase
Price.” The number and character of such shares of
Common Stock and the Purchase Price are subject to adjustment as
provided herein. The Company may reduce the Purchase Price for some
or all of the Warrants, temporarily or permanently, provided such reduction is made as to
all outstanding Warrants for all Holders of such
Warrants. Capitalized terms used and not otherwise defined
herein shall have the meanings set forth in that certain Securities
Purchase Agreement (the “Purchase Agreement”) entered into
by the Company and Holder pursuant to which this Warrant has been
issued.
As used
herein the following terms, unless the context otherwise requires,
have the following respective meanings:
(a)
The term
“Company” shall
mean Blockchain Industries, Inc., a Nevada
corporation.
(b) The
term “Common
Stock” includes (i) the Company’s Common Stock,
$0.001 par value per share and (ii) any other securities into which
or for which any of the securities described in (i) may be
converted or exchanged pursuant to a plan of recapitalization,
reorganization, merger, sale of assets or otherwise.
(c) The
term “Other
Securities” refers to any stock (other than Common
Stock) and other securities of the Company or any other person
(corporate or otherwise) which the holder of the Warrant at any
time shall be entitled to receive, or shall have received, on the
exercise of the Warrant, in lieu of or in addition to Common Stock,
or which at any time shall be issuable or shall have been issued in
exchange for or in replacement of Common Stock or Other Securities
pursuant to Section
3 hereof or otherwise.
(d) The
term “Warrant
Shares” shall mean the Common Stock issuable upon
exercise of this Warrant.
1.
Exercise of
Warrant.
1.1.
Number of Shares Issuable
upon Exercise. From and after the Issue Date through and
including the Expiration Date, the Holder shall be entitled to
receive, upon exercise of this Warrant in whole in accordance with
the terms of Section
1.2 hereof or upon exercise of this Warrant in part in
accordance with Section
1.3 hereof, shares of Common Stock of the Company, subject
to adjustment pursuant to Section 3 hereof.
1.2.
Full Exercise. This
Warrant may be exercised in full by the Holder hereof by delivery
to the Company of an original or facsimile copy of the form of
subscription attached as Exhibit A hereto (the
“Subscription
Form”) duly executed by such Holder and delivered
within two (2) business days thereafter of payment, in cash, wire
transfer or by certified or official bank check payable to the
order of the Company, in the amount obtained by multiplying the
number of shares of Common Stock for which this Warrant is then
exercisable by the Purchase Price then in effect. The original
Warrant is not required to be surrendered to the Company until it
has been fully exercised.
1.3.
Partial Exercise.
This Warrant may be exercised in part (but not for a fractional
share) by delivery of a Subscription Form in the manner and at the
place provided in Section
1.2 hereof, except that the amount payable by the Holder on
such partial exercise shall be the amount obtained by multiplying
(a) the number of whole shares of Common Stock designated by the
Holder in the Subscription Form by (b) the Purchase Price then in
effect. On any such partial exercise, upon the written request of
the Holder, provided the Holder has surrendered the original
Warrant, the Company, at its expense, will forthwith issue and
deliver to or upon the order of the Holder a new Warrant of like
tenor, in the name of the Holder hereof or as such Holder (upon
payment by such Holder of any applicable transfer taxes) may
request, the whole number of shares of Common Stock for which such
Warrant may still be exercised.
1.4.
Fair Market Value.
For purposes of this Warrant, the Fair Market Value of a share of Common
Stock as of a particular date (the “Determination Date”) shall
mean:
(a) If
the Company’s Common Stock is traded on an exchange or on the
NASDAQ Global Market, NASDAQ Global Select Market, the NASDAQ
Capital Market, the New York Stock Exchange or the NYSE AMEX
Equities, then the average of the closing sale prices of the Common
Stock for the five (5) trading days immediately prior to (but not
including) the Determination Date;
(b) If
the Company’s Common Stock is not traded on an exchange or on
the NASDAQ Global Market, NASDAQ Global Select Market, the NASDAQ
Capital Market, the New York Stock Exchange or the NYSE AMEX
Equities, but is traded on the OTC Bulletin Board or in the
over-the-counter market or Pink Sheets, then the average of the
closing bid and ask prices reported for the five (5) trading days
immediately prior to (but not including) the Determination
Date;
(c)
Except as provided in clause (d) below, if the Company’s
Common Stock is not publicly traded, then as the Holder and the
Company shall mutually agree, or in the absence of such an
agreement after good faith efforts of the Company and the Holder to
reach an agreement, by arbitration in accordance with the rules
then standing of the American Arbitration Association, before a
single arbitrator to be chosen from a panel of persons qualified by
education and training to pass on the matter to be decided;
or
(d) If
the Determination Date is the date of a liquidation, dissolution or
winding up, or any event deemed to be a liquidation, dissolution or
winding up pursuant to the Company’s charter, then all
amounts to be payable per share to holders of the Common Stock
pursuant to the charter in the event of such liquidation,
dissolution or winding up, plus all other amounts to be payable per
share in respect of the Common Stock in liquidation under the
charter, assuming for the purposes of this clause (d) that all of
the shares of Common Stock then issuable upon exercise of all of
the Warrants are outstanding at the Determination
Date.
1.5.
Company
Acknowledgment. The Company will, at the time of the
exercise of the Warrant, upon the request of the Holder hereof,
acknowledge in writing its continuing obligation to afford to such
Holder any rights to which such Holder shall continue to be
entitled after such exercise in accordance with the provisions of
this Warrant. If the Holder shall fail to make any such request,
such failure shall not affect the continuing obligation of the
Company to afford to such Holder any such rights.
1.6.
Delivery of Stock
Certificates, etc. on Exercise. The Company agrees that,
provided the purchase price listed in the Subscription Form is
received as specified in Section 1 hereof, the shares of
Common Stock purchased upon exercise of this Warrant shall be
deemed to be issued to the Holder hereof as the record owner of
such shares as of the close of business on the date on which
delivery of a Subscription Form shall have occurred and payment
made for such shares as aforesaid. As soon as practicable after the
exercise of this Warrant in full or in part and the payment is
made, and in any event within five (5) business days thereafter
(“Warrant Share Delivery
Date”), the Company, at its expense (including the
payment by it of any applicable issue taxes), will cause to be
issued in the name of, and delivered to, the Holder hereof, or as
such Holder (upon payment by such Holder of any applicable transfer
taxes) may direct in compliance with applicable securities laws, a
certificate or certificates for the number of duly and validly
issued, fully paid and non-assessable shares of Common Stock (or
Other Securities) to which such Holder shall be entitled on such
exercise, plus, in lieu of any fractional share to which such
Holder would otherwise be entitled, cash equal to such fraction
multiplied by the then Fair Market Value of one full share of
Common Stock, together with any other stock or other securities and
property (including cash, where applicable) to which such Holder is
entitled upon such exercise pursuant to Section 1 hereof or otherwise.
The Company understands that a delay in the delivery of the Warrant
Shares after the Warrant Share Delivery Date could result in
economic loss to the Holder. As compensation to the Holder for such
loss, the Company agrees to pay (as liquidated damages and not as a
penalty) to the Holder for late issuance of Warrant Shares upon
exercise of this Warrant the proportionate amount of $100 per
business day after the Warrant Share Delivery Date for each $10,000
of Purchase Price of Warrant Shares for which this Warrant is
exercised which are not timely delivered. The Company shall
promptly pay any payments incurred under this Section in
immediately available funds upon demand. Furthermore, in addition
to any other remedies which may be available to the Holder, in the
event that the Company fails for any reason to effect delivery of
the Warrant Shares by the Warrant Share Delivery Date, the Holder
may revoke all or part of the relevant Warrant exercise by delivery
of a written notice to such effect to the Company, whereupon the
Company and the Holder shall each be restored to their respective
positions immediately prior to the exercise of the relevant portion
of this Warrant, except that the liquidated damages described above
shall be payable through the date notice of revocation or
rescission is given to the Company.
2.
Payment of Purchase Price;
Cashless Exercise.
(a)
Payment upon exercise may be made at the written option of the
Holder either in (i) cash, wire transfer or by certified or
official bank check payable to the order of the Company equal to
the applicable aggregate Purchase Price, (ii) by delivery of Common
Stock issuable upon exercise of the Warrants in accordance with
Section (b) below or (iii) by a combination of any of the foregoing
methods, in each case accompanied by delivery of a properly
endorsed Subscription Form, for the number of Common Stock
specified in such form (as such exercise number shall be adjusted
to reflect any adjustment in the total number of shares of Common
Stock issuable to the Holder per the terms of this Warrant) and the
Holder shall thereupon be entitled to receive the number of duly
authorized, validly issued, fully-paid and non-assessable shares of
Common Stock (or Other Securities) determined as provided herein.
Notwithstanding the immediately preceding sentence, payment upon
exercise may be made in the manner described in Section 2(b) below only with
respect to Warrant Shares not included for unrestricted
public resale in an effective registration statement on the date
notice of exercise is given by the Holder.
(b) If
the Fair Market Value of one share of Common Stock is greater than
the Purchase Price (at the date of calculation as set forth below),
in lieu of exercising this Warrant for cash, the Holder, eligible
at any time, may elect to receive shares equal to the value (as
determined below) of this Warrant (or the portion thereof being
cancelled) by delivery of a properly endorsed Subscription Form
delivered to the Company by any means described in Section 11 hereof, in which
event the Company shall issue to the holder a number of shares of
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
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Y=
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the
number of shares of Common Stock purchasable under the Warrant or,
if only a portion of the Warrant is being exercised, the portion of
the Warrant being exercised (at the date of such
calculation)
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A=
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Fair
Market Value
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B=
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Purchase
Price (as adjusted to the date of such calculation)
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For
purposes of Rule 144 promulgated under the 1933 Act, it is
intended, understood and acknowledged that the Warrant Shares
issued in a cashless exercise transaction in the manner described
above shall be deemed to have been acquired by the Holder, and the
holding period for the Warrant Shares shall be deemed to have
commenced, on the date this Warrant was originally
issued.
3.
Extraordinary Events
Regarding Common Stock. In the event that the Company shall
(a) issue additional shares of Common Stock as a dividend or other
distribution on outstanding Common Stock, (b) subdivide its
outstanding shares of Common Stock, or (c) combine its outstanding
shares of the Common Stock into a smaller number of shares of
Common Stock, then, in each such event, the Purchase Price shall,
simultaneously with the happening of such event, be adjusted by
multiplying the then Purchase Price by a fraction, the numerator of
which shall be the number of shares of Common Stock outstanding
immediately prior to such event and the denominator of which shall
be the number of shares of Common Stock outstanding immediately
after such event, and the product so obtained shall thereafter be
the Purchase Price then in effect. The Purchase Price, as so
adjusted, shall be readjusted in the same manner upon the happening
of any successive event or events described in this Section 3. The number of shares
of Common Stock that the Holder of this Warrant shall thereafter,
on the exercise hereof, be entitled to receive shall be adjusted to
a number determined by multiplying the number of shares of Common
Stock that would otherwise (but for the provisions of this
Section 3) be
issuable on such exercise by a fraction of which (a) the numerator
is the Purchase Price that would otherwise (but for the provisions
of this Section 3)
be in effect, and (b) the denominator is the Purchase Price in
effect on the date of such exercise.
4.
Certificate as to
Adjustments. In each case of any adjustment or readjustment
in the shares of Common Stock (or Other Securities) issuable on the
exercise of the Warrants or in the Purchase Price, the Company at
its expense will promptly cause its Chief Financial Officer or
other appropriate designee to compute such adjustment or
readjustment in accordance with the terms of the Warrant and
prepare a certificate setting forth such adjustment or readjustment
and showing in detail the facts upon which such adjustment or
readjustment is based, including a statement of (a) the
consideration received or receivable by the Company for any
additional shares of Common Stock (or Other Securities) issued or
sold or deemed to have been issued or sold, (b) the number of
shares of Common Stock (or Other Securities) outstanding or deemed
to be outstanding, and (c) the Purchase Price and the number of
shares of Common Stock to be received upon exercise of this
Warrant, in effect immediately prior to such adjustment or
readjustment and as adjusted or readjusted as provided in this
Warrant. The Company will forthwith mail a copy of each such
certificate to the Holder of the Warrant. Holder will be entitled
to the benefit of the adjustment regardless of the giving of such
notice. The timely giving of such notice to Holder is a material
obligation of the Company.
5.
Reservation of Stock, etc.
Issuable on Exercise of Warrant; Financial Statements. The
Company will at all times reserve and keep available, solely for
issuance and delivery on the exercise of the Warrants, all shares
of Common Stock (or Other Securities) from time to time issuable on
the exercise of the Warrant. This Warrant entitles the Holder
hereof, upon written request, to receive copies of all financial
and other information distributed or required to be distributed to
the holders of the Company’s Common Stock.
6.
Assignment; Exchange of
Warrant. Subject to compliance with applicable securities
laws, this Warrant, and the rights evidenced hereby, may be
transferred by any registered holder hereof (a “Transferor”). On the surrender for
exchange of this Warrant, with the Transferor’s endorsement
in the form of Exhibit
B attached hereto (the “Transferor Endorsement Form”) and
together with an opinion of counsel reasonably satisfactory to the
Company that the transfer of this Warrant will be in compliance
with applicable securities laws, the Company will issue and deliver
to or on the order of the Transferor thereof a new Warrant or
Warrants of like tenor, in the name of the Transferor and/or the
transferee(s) specified in such Transferor Endorsement Form (each a
“Transferee”),
calling in the aggregate on the face or faces thereof for the
number of shares of Common Stock called for on the face or faces of
the Warrant so surrendered by the Transferor.
7.
Replacement of
Warrant. On receipt of evidence reasonably satisfactory to
the Company of the loss, theft, destruction or mutilation of this
Warrant and, in the case of any such loss, theft or destruction of
this Warrant, on delivery of an indemnity agreement or security
reasonably satisfactory in form and amount to the Company or, in
the case of any such mutilation, on surrender and cancellation of
this Warrant, the Company at its expense, twice only, will execute
and deliver, in lieu thereof, a new Warrant of like
tenor.
8.
Maximum Exercise.
The Holder shall not be entitled to exercise this Warrant on an
exercise date, in connection with that number of shares of Common
Stock which would be in excess of the sum of (i) the number of
shares of Common Stock beneficially owned by the Holder and its
affiliates on an exercise date, and (ii) the number of shares of
Common Stock issuable upon the exercise of this Warrant with
respect to which the determination of this limitation is being made
on an exercise date, which would result in beneficial ownership by
the Holder and its affiliates of more than 4.99% of the outstanding
shares of Common Stock on such date. For the purposes of the
immediately preceding sentence, beneficial ownership shall be
determined in accordance with Section 13(d) of the 1934 Act and
Rule 13d-3 thereunder. Subject to the foregoing, the Holder shall
not be limited to aggregate exercises which would result in the
issuance of more than 4.99%. The Holder may allocate which of the
equity of the Company deemed beneficially owned by the Holder shall
be included in the 4.99% amount described above and which shall be
allocated to the excess above 4.99%. The restriction described in
this paragraph may be waived, in whole or in part, upon sixty-one
(61) days’ prior notice from the Holder to the Company to
increase such percentage.
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9.
Transfer on the
Company’s Books. Until this Warrant is transferred on
the books of the Company, the Company may treat the registered
holder hereof as the absolute owner hereof for all purposes,
notwithstanding any notice to the contrary.
10.
Notices. All
notices, demands, requests, consents, approvals, and other
communications required or permitted hereunder shall be in writing
and, unless otherwise specified herein, shall be (i) personally
served, (ii) deposited in the mail, registered or certified, return
receipt requested, postage prepaid, (iii) delivered by reputable
air courier service with charges prepaid, or (iv) transmitted by
hand delivery, email, or facsimile addressed as set forth below or
to such other address as such party shall have specified most
recently by written notice. Any notice or other communication
required or permitted to be given hereunder shall be deemed
effective (a) upon hand delivery or delivery by email or delivery
by facsimile, with accurate confirmation generated by the
transmitting facsimile machine, at the address or number designated
below (if delivered on a business day during normal business hours
where such notice is to be received), or the first business day
following such delivery (if delivered other than on a business day
during normal business hours where such notice is to be received),
or (b) on the second business day following the date of mailing by
express courier service, fully prepaid, addressed to such address,
or upon actual receipt of such mailing, whichever shall first
occur. The addresses for such communications shall be: (i) if to
the Company, to Blockchain Industries, Inc., 1730 Arizona Ave.,
Suite 220, Santa Monica, California 90401, Attn: Patrick Moynihan,
and (ii) if to the Holder, to the address and facsimile number
listed on the first paragraph of this Warrant.
11.
Law Governing This
Warrant. This Warrant shall be governed by and construed in
accordance with the laws of the State of New York without regard to
its principles of conflicts of laws or of any other State. Any
action brought by either party hereto 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. The parties to this Warrant hereby
irrevocably waive any objection to jurisdiction and venue of any
action instituted hereunder and shall not assert any defense based
on lack of jurisdiction or venue or based upon forum non conveniens.
The Company and the Holder waive
trial by jury. The prevailing party shall be entitled to
recover from the other party its reasonable attorney’s fees
and costs. In the event that any provision of this Warrant or any
other agreement delivered in connection herewith is invalid or
unenforceable under any applicable statute or rule of law, then
such provision shall be deemed inoperative to the extent that it
may conflict therewith and shall be deemed modified to conform to,
such statute or rule of law. Any such provision which may prove
invalid or unenforceable under any law shall not affect the
validity or enforceability of any other provision of any agreement.
Each party hereto hereby irrevocably waives personal service of
process and consents to process being served in any suit, action or
proceeding in connection with this Warrant or any other transaction
document by mailing a copy thereof via registered or certified mail
or overnight delivery (with evidence of delivery) to such party at
the address in effect for notices to it under this Warrant and
agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein
shall be deemed to limit in any way any right to serve process in
any other manner permitted by law.
[-Signature Page Follows-]
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IN
WITNESS WHEREOF, the Company has executed this Warrant as of the
date first written above.
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BLOCKCHAIN INDUSTRIES, INC.
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By:
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Name:
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Patrick
Moynihan
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Title:
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Chief
Executive Officer
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Exhibit A
FORM OF
EXERCISE
(to be
signed only on exercise of Warrant)
TO:
BLOCKCHAIN INDUSTRIES, INC.
The
undersigned, pursuant to the provisions set forth in the attached
Warrant (No.____), hereby irrevocably elects to purchase (check
applicable box):
___
________ shares of the Common Stock covered by such Warrant;
or
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the
maximum number of shares of Common Stock covered by such Warrant
pursuant to the cashless exercise procedure set forth in Section 2
of the Warrant.
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The
undersigned herewith makes payment of the full purchase price for
such shares at the price per share provided for in such Warrant,
which is $______. Such payment takes the form of (check applicable
box or boxes):
___
$__________ in lawful money of the United States;
and/or
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the
cancellation of such portion of the attached Warrant as is
exercisable for a total of _______ shares of Common Stock (using a
Fair Market Value of $_______ per share for purposes of this
calculation); and/or
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the
cancellation of such number of shares of Common Stock as is
necessary, in accordance with the formula set forth in Section 2 of
the Warrant, to exercise this Warrant with respect to the maximum
number of shares of Common Stock purchasable pursuant to the
cashless exercise procedure set forth in Section 2.
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After
application of the cashless exercise feature as described above,
_____________ shares of Common Stock are required to be delivered
pursuant to the instructions below.
The
undersigned requests that the certificates for such shares be
issued in the name of, and delivered to
__________________________________________, whose address is
___________________________
__________________________________________________________________________________________________.
The
undersigned represents and warrants that all offers and sales by
the undersigned of the securities issuable upon exercise of the
within Warrant shall be made pursuant to registration of the Common
Stock under the Securities Act of 1933, as amended (the
“Securities Act”), or pursuant to an exemption from
registration under the Securities Act.
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Dated:___________________
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(Signature
must conform to name of holder as
specified
on the face of the Warrant)
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(Address)
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Exhibit B
FORM OF
TRANSFEROR ENDORSEMENT
(To be
signed only on transfer of Warrant)
For
value received, the undersigned hereby sells, assigns, and
transfers unto the person(s) named below under the heading
“Transferees” the right represented by the within
Warrant to purchase the percentage and number of shares of Common
Stock of BLOCKCHAIN INDUSTRIES, INC. to which the within Warrant
relates specified under the headings “Percentage
Transferred” and “Number Transferred,”
respectively, opposite the name(s) of such person(s) and appoints
each such person Attorney to transfer its respective right on the
books of BLOCKCHAIN INDUSTRIES, INC., with full power of
substitution in the premises.
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Transferees
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Percentage
Transferred
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Number
Transferred
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Dated:
__________________, _______
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(Signature
must conform to name of holder as specified
on the
face of the warrant)
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Signed
in the presence of:
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(Name)
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(address)
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ACCEPTED
AND AGREED:
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[TRANSFEREE]
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(address)
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(Name)
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