Exhibit 10.3
 
EXECUTION COPY
 
THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS
OF ANY STATE.  NEITHER THIS WARRANT OR SUCH SECURITIES MAY BE SOLD, OFFERED FOR
SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES
LAWS, OR SOME EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT AND LAWS,
OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT
REQUIRED UNDER SUCH ACT OR LAWS, OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SUCH
ACT.
 
ACCELERIZE NEW MEDIA, INC.

COMMON STOCK WARRANT

This Warrant is issued effective as of January 1, 2007 (the “Warrant Issue
Date”) to Daniel Goldberg (“Holder”), by ACCELERIZE NEW MEDIA, INC., a Delaware
corporation (the “Company”) in connection with the Asset Purchase Agreement
dated as of December __, 2006 by and among the Company, Holder and the other
parties thereto (the “Asset Purchase Agreement”).

 
1.           Purchase of Shares.  Subject to the terms and conditions
hereinafter set forth, the Holder is entitled, upon surrender of this Warrant at
the principal office of the Company (or at such other place as the Company shall
notify the Holder in writing), to purchase from the Company up to 250,000 shares
of the Company’s Common Stock, par value $0.001 per share (the “Common Stock”),
pursuant to the terms of Section 2.  The number of shares of Common Stock
issuable pursuant to this Section 1 (the “Shares”) shall be subject to
adjustment pursuant to Section 8 hereof.
 
2.           Term and Exerciseability of Warrant.  This Warrant may be exercised
only to the extent vested from time to time.
 
(a)           Subject to the provisions below, this Warrant will vest 100% on
the eighteen (18) month anniversary of the date hereof (the “Warrant Vesting
Date”), but will only be exerciseable if, and to the extent, the Special Vesting
Provisions set forth on Schedule 1 have been met
 
(b)           This Warrant shall fully vest and become exercisable immediately
prior to the effective date of a Change in Control (defined below).
 

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(c)           For purposes of this Agreement, the term “Change in Control” shall
mean (i) the sale of all or substantially all of the assets of the Company, (ii)
the sale of more than 50% of the outstanding capital stock of the Company in a
non-public sale, (iii) the dissolution or liquidation of the Company, or (iv)
any merger, share exchange, consolidation or other reorganization or business
combination of the Company if immediately after such transaction of either (A)
persons who were directors of the Company immediately prior to such transaction
do not constitute at least a majority of the directors of the surviving entity,
or (B) persons who hold a majority of the voting capital stock of the surviving
entity are not persons who held a majority of the voting capital stock of the
Company immediately prior to the transaction; provided, however, that the term
“Change in Control” shall not include a public offering of capital stock of the
Company that is effected pursuant to a registration statement filed with, and
declared effective by, the Securities and Exchange Commission under the
Securities Act of 1933.
 
(d)           If the Holder dies before this Warrant has been exercised in full,
the executor, administrator or personal representative of the estate of the
Holder may exercise this Warrant as set forth in this paragraph; provided that
such exercise must be within twelve (12) months of Holder’s death.
 
3.           Exercise Price.  The exercise price per share for which the Shares
may be purchased pursuant to the terms of this Warrant shall be $.15 per share,
and shall be subject to adjustment pursuant to Section 8 hereof (such price, as
adjusted from time to time, is herein referred to as the “Exercise Price”).
 
(a)           Exercise Period.  This Warrant may be exercised to the extent
vested, in whole or in part, commencing on the Warrant Vesting Date and ending
at 5:00 p.m., United States Eastern Time, on the fifth anniversary of the
Warrant Issue Date (the “Expiration Date”).  For the avoidance of doubt, if any
part of this Warrant remains unvested or unexercised after the Expiration Date,
the Holder’s rights with respect to such shares shall extinguish and this
Warrant shall no longer be of any force or effect.
 
4.           Method of Exercise.  While this Warrant remains outstanding and
exercisable in accordance with Sections 2 and 3 above, the Holder may exercise,
in whole or in part, the purchase rights evidenced hereby.  Such exercise shall
be effected by:
 
(a)           the surrender of the Warrant, together with a duly executed copy
of the form of Notice of Election attached hereto, to the President of the
Company at its principal offices; and
 
(b)           the payment to the Company of an amount equal to the aggregate
Exercise Price for the number of Shares being purchased.  This Warrant can also
be exercised at Holder’s discretion, in whole or in part, in a “cashless”
exercise.  In a cashless exercise, the right to purchase each share of Common
Stock may be exchanged for that number of shares of Common Stock determined by
multiplying the number one (1) by a fraction, the numerator of which will be the
difference between (y) the then current Fair Market Value and (z) the exercise
price, and the denominator of which will be the then current Fair Market Value.
 
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5.           Fair Market Value. 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 is quoted on The
Nasdaq Stock Market, Inc., then the last sale price reported for the last
business day immediately preceding the Determination Date;

(b)
If the Company’s Common Stock is not traded on an exchange or quoted on The
Nasdaq Stock Market, Inc., but is traded in the over-the-counter market, then
the average of the closing bid and ask prices reported for the last business day
immediately preceding 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 agree, or in the absence of
such 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 shares 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 that 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.

6.           Certificates for Shares.  Upon the exercise of the purchase rights
evidenced by this Warrant, one or more certificates for the number of Shares so
purchased shall be issued as soon as practicable thereafter (with appropriate
restrictive legends, if applicable), and in any event within three (3) business
days thereafter, 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 nonassessable shares of Common Stock (or other securities) to
which such Holder shall be entitled on such exercise.
 
7.           Issuance of Shares.  The Company covenants that the Shares, when
issued pursuant to the exercise of this Warrant, will be duly and validly
issued, fully paid and nonassessable and free from all taxes, liens, and charges
with respect to the issuance thereof.  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, for
the purpose of issue or transfer upon exercise of the rights evidenced by this
Warrant, a sufficient number of shares of authorized but unissued capital stock,
or other securities and property, when and as required to provide for the
exercise of the rights represented by this Warrant.  The Company will take all
such action as may be necessary to assure that such shares of capital stock may
be issued as provided herein without violation of any applicable law or
regulation, or of any requirements of any domestic securities exchange upon
which the capital stock may be listed.
 
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8.           Adjustment of Exercise Price and Number of Shares.  The number of
and kind of securities purchasable upon exercise of this Warrant shall be
subject to adjustment from time to time as follows:
 
(a)           In the event that the outstanding shares of Common Stock are
hereafter exchanged for a different number or kind of shares or other securities
of the Company, by reason of a reorganization, recapitalization, exchange of
shares, stock split, combination of shares or dividend payable in shares or
other securities, a corresponding adjustment shall be made by the board of
directors of the Company (the “Board”) in the number and kind of shares or other
securities covered by this Warrant.  Any such adjustment shall be made without
change in the total price applicable to the unexercised portion of the Warrant,
but the price per share specified in this Agreement shall be correspondingly
adjusted.
 
(b)           If, while this Warrant is unexercised and remains outstanding, the
Company merges or consolidates with a wholly-owned Subsidiary for the purpose of
reincorporating itself under the laws of another jurisdiction, the Holder will
be entitled to acquire shares of common stock of the reincorporated Company upon
the same terms and conditions as were in effect immediately prior to such
reincorporation (unless such reincorporation involves a change in the number of
shares or the capitalization of the Company, in which case proportional
adjustments shall be made as provided above).
 
(c)           Except as expressly provided to the contrary in this Section 8,
the issuance by the Company of shares of stock of any class for cash or property
or for services, either upon direct sale or upon the exercise of rights or
warrants, or upon conversion of shares or obligations of the Company convertible
into such shares or other securities, shall not affect the number, class or
price of shares of Common Stock then subject to outstanding Warrants.
 
(d)           Notice of Adjustment.  When any adjustment is required to be made
in the number or kind of shares purchasable upon exercise of the Warrant, or in
the Exercise Price, the Company shall promptly notify the Holder of such event
and of the number of Shares or other securities or property thereafter
purchasable upon exercise of this Warrant.
 
9.           Registration Rights.  If at any time, or from time to time, during
the five-year period following the issuance of the Warrant the Company, shall
determine to prepare and file with the Securities and Exchange Commission
(“SEC”), a registration statement relating to an offering for its own account or
the account of others under the Act of any of its equity securities or debt or
their then equivalents (the "Registration Statement"), then the Company shall
send to the Holder a written notice of such determination and, if within ten
(10) days after receipt by the Holder, the Company shall receive a request in
writing from the Holder, the Company shall include in such Registration
Statement all or any part of such Shares such Holder  requests to be registered,
provided, however, that (a) if, at any time after giving written notice of its
intention to register any securities and prior to the effective date of the
Registration Statement filed in connection with such registration, the Company
determines for any reason not to proceed with such registration, the Company
shall be relieved of its obligation to register any Shares in connection with
such registration, and (b) in case of a determination by the Company to delay
registration of its securities, the Company will be permitted to delay the
registration of the Shares for the same period as the delay in registering such
other securities, in any such case without any obligation or liability to the
Holder.
 
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10.           Nonassignability of Rights.  This Warrant shall not be assignable
or transferable by the Holder except by will or by the laws of descent and
distribution and during the life of the Holder, this Warrant shall be
exercisable only by him.
 
11.           Confidentiality.  The Holder hereby agrees that the entire
contents of this Agreement are confidential at all times, and that the Warrant’s
exercisability is conditioned on his compliance with this covenant; provided,
however, that the Holder may disclose the contents of this Agreement to his
spouse and to his legal and financial advisors.
 
12.           Compliance with Securities Act.  The Company shall not be
obligated to sell or issue any shares of Common Stock or other securities
pursuant to the exercise of this Warrant unless the shares of Common Stock or
other securities with respect to which this Warrant is being exercised are at
that time effectively registered or exempt from registration under the
Securities Act and applicable state securities laws.  In the event shares or
other securities shall be issued that shall not be so registered, the Holder
hereby represents, warrants and agrees that he will receive such shares or other
securities for investment and not with a view to their resale or distribution,
and will execute an appropriate investment letter satisfactory to the Company
and its counsel.
 
13.           Legends.  The Holder hereby acknowledges that the stock
certificate or certificates evidencing shares of Common Stock or other
securities issued pursuant to any exercise of this Warrant may bear a legend
setting forth the restrictions on their transferability described in 12 hereof.
 
14.           Rights as Stockholder.  The Holder shall have no rights as a
stockholder with respect to any shares of Common Stock or other securities
covered by this Warrant until the date of issuance of a certificate to him or
her for such shares or other securities.  No adjustment shall be made for
dividends or other rights for which the record date is prior to the date such
stock certificate is issued, except as required or permitted by Section 8
hereof.
 
15.           Amendment; Waivers.  This Agreement, contains the full and
complete understanding and agreement of the parties hereto as to the subject
matter hereof and, except as otherwise permitted by the express terms of this
Agreement, it may not be modified or amended, nor may any provision hereof be
waived, except by a further written agreement duly signed by each of the
parties; provided, however, that a modification or amendment that does not
adversely affect the rights of the Holder hereunder, as they may exist
immediately before the effective date of the modification or amendment, shall be
effective upon written notice of its provisions to the Holder.  The waiver by
either of the parties hereto of any provision hereof in any instance shall not
operate as a waiver of any other provision hereof or in any other instance.
 
16.           Binding Effect.  This Agreement shall inure to the benefit of and
be binding upon the parties hereto and, to the extent provided herein, their
respective heirs, executors, administrators, representatives, successors and
assigns.
 
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17.           Construction.  The titles of the sections of this Agreement are
included for convenience only and shall not be construed as modifying or
affecting their provisions.  The masculine gender shall include both sexes; the
singular shall include the plural and the plural the singular unless the context
otherwise requires.
 
18.           Governing Law.  This Agreement shall be governed by and construed
and enforced in accordance with the applicable laws of the State of New York
(other than the law governing conflict of law questions).
 
19.           Notices.  Any notice in connection with this Agreement shall be
deemed to have been properly delivered if it is in writing and is delivered by
hand or facsimile or sent by registered mail to the party addressed as follows,
unless another address has been substituted by notice so given:
 
To the Holder:
To his address as listed on the books of the Company

 
To the Company:
Accelerize New Media, Inc.
1280 Helms Road
Columbia Falls, MT 59912
Attention:  Brian Ross
Facsimile:  (406) 862-2162
      and     with a copy to: 
Sullivan & Worcester LLP
1290 Avenue of the Americas
New York, NY  10104
Attention:  J. Truman Bidwell, Jr., Esq.

 
 
[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by an
officer thereunto duly authorized.

ACCELERIZE NEW MEDIA, INC.

By:           ________________________
Brian Ross
Title:

ACKNOWLEDGED:

By:          ______________________________
Daniel Goldberg

Address:                ________________________
________________________
________________________

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Schedule 1 to Warrant Agreement
 
Special Vesting Provisions:  This Warrant shall only vest and be exercisable if,
and to the extent, one of the Performance Targets set forth below have been met
on the Warrant Vesting Date.
 
(1)           If, by the Warrant Vesting Date, the Tier 1 DRG Performance Target
has been met, this Warrant shall be exercisable as to 250,000 Shares (and the
provisions of (2) and (3) below shall be null and void);
 
(2)           If, by the Warrant Vesting Date, the Tier 2 DRG Performance Target
has been met, this Warrant shall be exercisable as to 225,000 Shares (and the
provisions of (3) below shall be null and void); or
 
(3)           If, by the Warrant Vesting Date, the Tier 3 DRG Performance Target
has been met, this Warrant shall be exercisable as to 200,000 Shares.
 
For purposes of this Special Vesting Provision:
 
(i)           “Tier 1 DRG Performance Target” means aggregate revenues of
$1,100,000 and aggregate Gross Profit of $330,000 produced by the Business
between the Warrant Issue Date and the Warrant Vesting Date.
 
(ii)           “Tier 2 DRG Performance Target” means aggregate revenues of
$1,000,000 and aggregate Gross Profit of $300,000 produced by the Business
between the Warrant Issue Date and the Warrant Vesting Date.
 
(iii)           “Tier 3 DRG Performance Target” means aggregate revenues of
$900,000 and aggregate Gross Profit of $270,000 produced by the Business between
the Warrant Issue Date and the Warrant Vesting Date.
 
(iv)           “Gross Profit” means revenues of the Business minus expenses of
the Business (including but not limited to taxes, depreciation and amortization
but specifically excluding the salary expense of Goldberg and Stein under their
respective contracts referred to in Section 4.2).
 
(v)           Gross Profit and revenues shall be determined pursuant to the
methods described in Section 3.1 of the Asset Purchase Agreement.  Capitalized
terms used herein and not otherwise defined shall have the meanings ascribed to
them in the Asset Purchase Agreement.
 

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NOTICE OF EXERCISE
 
To:  [Company Name].
 
The undersigned hereby elects to [check applicable subsection]:
 
________
Purchase _________________ of Accelerize New Media, Inc., Common Stock pursuant
to the terms of the attached Warrant and payment of the Exercise Price per share
required under such Warrant accompanies this notice;

 
The undersigned hereby represents and warrants that the undersigned is acquiring
such shares for its own account for investment purposes only, and not for resale
or with a view to distribution of such shares or any part thereof.
 
WARRANT HOLDER:

[NAME OF HOLDER]

By:           ______________________________
Name:      ______________________________
Title:        ______________________________

Date:     __________________

Name in which shares should be registered:

_____________________________________

Address:                _________________________
_________________________
_________________________