--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

Exhibit 10.28

 
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THIS
WARRANT (THE “SECURITIES”) HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933 (THE “SECURITIES ACT”) OR UNDER ANY STATE SECURITIES LAWS (“BLUE SKY
LAWS”). NO TRANSFER, SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION OR OTHER
DISPOSITION OF THE SECURITIES OR ANY INTEREST THEREIN MAY BE MADE EXCEPT
(A) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND
ANY APPLICABLE BLUE SKY LAWS OR (B) IF THE COMPANY HAS BEEN FURNISHED WITH AN
OPINION OF COUNSEL FOR THE HOLDER, WHICH OPINION AND COUNSEL WILL BE REASONABLY
SATISFACTORY TO THE COMPANY, TO THE EFFECT THAT NO REGISTRATION IS REQUIRED
BECAUSE OF THE AVAILABILITY OF AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT AND APPLICABLE BLUE SKY LAWS.
 
WARRANT
 
To Purchase ________ Shares of Common Stock
of
U-VEND INTERNATIONAL, INC.
 
EXERCISABLE ON OR BEFORE, AND VOID AFTER
5:00 P.M. EASTERN TIME ON ________, 2016 (Three years from issuance)
 
THIS CERTIFIES THAT, for good and valuable consideration, Automated Retail
Leasing Partners, LP (“Holder”), or its registered assigns, is entitled to
subscribe for and purchase from U-VEND INTERNATIONAL,INC., a Delaware
corporation (the “Company”), at any time after _________, 2013, to and including
__________, 2016, _________________ (___,____) fully paid and non-assessable
shares of the Common Stock of the Company (“Shares”) at the price of $0.__ per
Share (the “Warrant Exercise Price”), subject to the anti-dilution provisions of
this Warrant.
 
The Shares that may be acquired upon exercise of this Warrant are sometimes
referred to herein as the “Warrant Shares.” As used herein, the term “Holder”
includes any party who acquires all or a part of this Warrant as a registered
transferee of Holder, or any record holder or holders of the Warrant Shares
issued upon exercise, whether in whole or in part, of the Warrant. The term
“Shares” means the common stock, par value $0.001 per share, of the Company, and
will also include any capital stock of any class of the Company hereafter
authorized which will not be limited to a fixed sum or percentage in respect of
the rights of the holders thereof to participate in dividends or in the
distribution of assets upon the voluntary or involuntary liquidation,
dissolution, or winding up of the Company. The term “Convertible Securities”
means any stock or other securities convertible into, or exchangeable for,
Shares.
 
This Warrant is subject to the following provisions, terms and conditions:
 
 
 

--------------------------------------------------------------------------------

 
 
1. Exercise; Transferability.
 
(a)           The rights represented by this Warrant may be exercised by the
Holder hereof, in whole or in part (but not as to a fractional Share), by
written notice of exercise (in the form attached hereto) delivered to the
Company at the principal office of the Company prior to the expiration of this
Warrant and accompanied or preceded by the surrender of this Warrant along with
a check in payment of the Warrant Exercise Price for such shares.
 
(b)           Limitations on Exercises
 
  Notwithstanding anything to the contrary contained in this Warrant, this
Warrant shall not be exercisable by the Holder hereof to the extent (but only to
the extent) that the Holder or any of its affiliates would beneficially own in
excess of 4.99% (the “Maximum Percentage”) of the Common Stock. To the extent
the above limitation applies, the determination of whether this Warrant shall be
exercisable (vis-à-vis other convertible, exercisable or exchangeable securities
owned by the Holder or any of its affiliates) and of which such securities shall
be exercisable (as among all such securities owned by the Holder) shall, subject
to such Maximum Percentage limitation, be determined on the basis of the first
submission to the Company for conversion, exercise or exchange (as the case may
be). No prior inability to exercise this Warrant pursuant to this paragraph
shall have any effect on the applicability of the provisions of this
paragraph with respect to any subsequent determination of exercisability. For
the purposes of this paragraph, beneficial ownership and all determinations and
calculations (including, without limitation, with respect to calculations of
percentage ownership) shall be determined in accordance with Section 13(d) of
the 1934 Act (as defined in the Securities Purchase Agreement) and the rules and
regulations promulgated thereunder. The provisions of this paragraph shall be
implemented in a manner otherwise than in strict conformity with the terms of
this paragraph to correct this paragraph (or any portion hereof) which may be
defective or inconsistent with the intended Maximum Percentage beneficial
ownership limitation herein contained or to make changes or supplements
necessary or desirable to properly give effect to such Maximum Percentage
limitation. The limitations contained in this paragraph shall apply to a
successor Holder of this Warrant. The holders of Common Stock shall be third
party beneficiaries of this paragraph and the Company may not waive this
paragraph without the consent of holders of a majority of its Common Stock. For
any reason at any time, upon the written or oral request of the Holder, the
Company shall within one (1) Business Day confirm orally and in writing to the
Holder the number of shares of Common Stock then outstanding, including by
virtue of any prior conversion or exercise of convertible or exercisable
securities into Common Stock, including, without limitation, pursuant to this
Warrant or securities issued pursuant to the Equipment Lease Notes.  By written
notice to the Company, any Holder may increase or decrease the Maximum
Percentage to any other percentage not in excess of 9.99% specified in such
notice; provided that (i) any such increase will not be effective until the 61st
day after such notice is delivered to the Company, and (ii) any such increase or
decrease will apply only to the Holder sending such notice and not to any other
holder of the Warrants.
 
2. Exchange and Replacement. Subject to Sections 1 and 7 hereof, this Warrant is
exchangeable upon the surrender hereof by the Holder to the Company at its
office for new Warrants of like tenor and date representing in the aggregate the
right to purchase the number of Warrant Shares purchasable hereunder, each of
such new Warrants to represent the right to purchase such number of Warrant
Shares (not to exceed the aggregate total number purchasable hereunder) as will
be designated by the Holder at the time of such surrender. Upon receipt by the
Company of evidence reasonably satisfactory to it of the loss, theft,
destruction, or mutilation of
 
 
2

--------------------------------------------------------------------------------

 
 
this Warrant, and, in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to it, and upon surrender and cancellation of
this Warrant, if mutilated, the Company will make and deliver a new Warrant of
like tenor, in lieu of this Warrant.  This Warrant will be promptly canceled by
the Company upon the surrender hereof in connection with any exchange or
replacement. The Company will pay all expenses, taxes (other than stock transfer
taxes), and other charges payable in connection with the preparation, execution,
and delivery of Warrants pursuant to this Section 2.
 
3. Issuance of the Warrant Shares.
 
(a)           The Company agrees that the Warrant Shares purchased upon exercise
of this Warrant will be and are deemed to be issued to the Holder as of the
close of business on the date on which this Warrant will have been surrendered
and the payment made for such Warrant Shares as aforesaid. Subject to the
provisions of paragraph (b) of this Section 3, certificates for the Warrant
Shares so purchased will be delivered to the Holder within a reasonable time,
not exceeding fifteen (15) days after the rights represented by this Warrant
will have been so exercised, and, unless this Warrant has expired, a new Warrant
representing the right to purchase the number of Warrant Shares, if any, with
respect to which this Warrant will not then have been exercised will also be
delivered to the Holder within such time.
 
(b)           Notwithstanding the foregoing, however, the Company will not be
required to deliver any certificate for Warrant Shares upon exercise of this
Warrant except in accordance with registration under or exemptions from the
applicable securities registration requirements under the Securities Act or
applicable Blue Sky Laws. Nothing herein, however, will obligate the Company to
effect registrations under the Securities Act or applicable Blue Sky Laws. The
Holder agrees to execute such documents and make such representations,
warranties, and agreements as may be required solely to comply with the
exemptions relied upon by the Company for the issuance of the Warrant Shares.
 
4. Covenants of the Company. The Company covenants and agrees that all Warrant
Shares will, upon issuance, be duly authorized and issued, fully paid,
non-assessable and free from all taxes, liens and charges with respect to the
issue 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 subscription rights evidenced by this Warrant a
sufficient number of Shares to provide for the exercise of the rights
represented by this Warrant.
 
5. Anti-Dilution Adjustments. The provisions of this Warrant are subject to
adjustment as provided in this Section 5.
 
(a)           The Warrant Exercise Price will be adjusted from time to time such
that in case the Company will hereafter:
 
(i)           pay any dividends on any class of stock of the Company payable in
Shares or Convertible Securities;
 
(ii)           subdivide its then outstanding Shares into a greater number of
Shares; or
 
 
3

--------------------------------------------------------------------------------

 
 
(iii)           combine outstanding Shares by reclassification or otherwise;
 
then, in any such event, the Warrant Exercise Price in effect immediately prior
to such event will (until adjusted again pursuant hereto) be adjusted
immediately after such event to a price (calculated to the nearest full cent)
determined by dividing (A) the number of Shares outstanding immediately prior to
such event, multiplied by the then existing Warrant Exercise Price, by (B) the
total number of Shares outstanding immediately after such event (including in
each case the maximum number of Shares issuable in respect of any Convertible
Securities), and the resulting quotient will be the adjusted Warrant Exercise
Price per share. An adjustment made pursuant to this Section 5 will become
effective immediately after the record date in the case of a dividend or
distribution and will become effective immediately after the effective date in
the case of a subdivision, combination or reclassification. If, as a result of
an adjustment made pursuant to this Section 5, the Holder of any Warrant
thereafter surrendered for exercise will become entitled to receive shares of
two or more classes of capital stock and other capital stock of the Company, the
Board of Directors (whose determination will be conclusive) will determine the
allocation of the adjusted Warrant Exercise Price between or among shares of
such classes of capital stock. All calculations under this Section 5(a) will be
made to the nearest cent or to the nearest 1/100 of a share, as the case may be.
In the event that at any time as a result of an adjustment made pursuant to this
Section 5(a), the holder of any Warrant thereafter surrendered for exercise will
become entitled to receive any shares of capital stock of the Company other than
Shares, thereafter the Warrant Exercise Price of such other shares so receivable
upon exercise of any Warrant will be subject to adjustment from time to time in
a manner and on terms as nearly equivalent as practicable to the provisions with
respect to Shares contained in this Section 5.
 
(b)            If and whenever on or after the date of the first funding, the
Company issues or sells, or in accordance with this Section 5 is deemed to have
issued or sold, any shares of Common Stock for a consideration per share less
than a price equal to the Warrant Exercise Price in effect immediately prior to
such issue or sale or deemed issuance or sale (the foregoing a “Dilutive
Issuance”), then, immediately after such Dilutive Issuance, the Warrant Exercise
Price then in effect shall be reduced based on a “Weighted Average Anti-Dilution
basis.  For all purposes of the foregoing (including, without limitation,
determining the adjusted Warrant Exercise Price and consideration per share
under this Section 5(b)), the following shall be applicable:
 
New Exercise Price = A * (B + C)
               (B + D)

For purposes of the foregoing formula:

A= the original Warrant Exercise Price.
B= the number of Common Shares outstanding prior to the transaction.
C= the number of Warrant Shares outstanding prior to the transaction.
D= the number of Common Shares issued or to be issued in the transaction

New Warrant Shares = a * (b)
 (c)

 
4

--------------------------------------------------------------------------------

 
 
For purposes of the foregoing formula:

a= the original amount of Warrant Shares.
b= the original Warrant Exercise Price.
c= the new Warrant Exercise Price.
 
(c)           Upon each adjustment of the Warrant Exercise Price pursuant to
Section 5(a) or (b), the Holder of each Warrant will thereafter (until another
such adjustment) be entitled to purchase at the adjusted Warrant Exercise Price
the number of shares, calculated to the nearest full share, obtained by
multiplying the number of shares specified in such Warrant (as adjusted as a
result of all adjustments in the Warrant Exercise Price in effect prior to such
adjustment) by the Warrant Exercise Price in effect prior to such adjustment and
dividing the product so obtained by the adjusted Warrant Exercise Price.
 
(d)           In case of any consolidation or merger to which the Company is a
party other than a merger or consolidation in which the Company is the
continuing corporation, or in case of any sale or conveyance to another
corporation of the property of the Company as an entirety or substantially as an
entirety, or in the case of any statutory exchange of securities with another
corporation (including any exchange effected in connection with a merger of a
third corporation into the Company), there will be no adjustment under
Section 5(a) above but the Holder of each Warrant then outstanding will have the
right thereafter to convert such Warrant into the kind and amount of shares of
capital stock and other securities and property which he would have owned or
have been entitled to receive immediately after such consolidation, merger,
statutory exchange, sale, or conveyance had such Warrant been converted
immediately prior to the effective date of such consolidation, merger, statutory
exchange, sale, or conveyance and in any such case, if necessary, appropriate
adjustment will be made in the application of the provisions set forth in this
Section 5 with respect to the rights and interests thereafter of any Holders of
the Warrant, to the end that the provisions set forth in this Section 5 will
thereafter correspondingly be made applicable, as nearly as may reasonably be,
in relation to any shares of stock and other securities and property thereafter
deliverable on the exercise of the Warrant. The provisions of this Section 5(c)
will similarly apply to successive consolidations, mergers, statutory exchanges,
sales or conveyances.
 
(e)           Upon any adjustment of the Warrant Exercise Price, then and in
each such case, the Company will give written notice thereof, by First-class
mail, postage prepaid, addressed to the Holder as shown on the books of the
Company, which notice will state the Warrant Exercise Price resulting from such
adjustment and the increase or decrease, if any, in the number of Shares
purchasable at such price upon the exercise of this Warrant, setting forth in
reasonable detail the method of calculation and the facts upon which such
calculation is based.
 
6. No Voting Rights.  This Warrant will not entitle the Holder to any voting
rights or other rights as a shareholder of the Company.
 
7. Notice of Transfer of Warrant or Resale of the Warrant Shares.  The Holder,
by acceptance hereof, agrees to give written notice to the Company before
transferring this Warrant or transferring any Warrant Shares of such Holder’s
intention to do so, describing briefly the manner of any proposed transfer.
Holder shall also furnish the Company with an
 
 
5

--------------------------------------------------------------------------------

 
 
opinion of counsel reasonably acceptable to it to the effect that promptly upon
receiving such written notice, the Company will present copies thereof to
counsel to the original purchaser of this Warrant. The proposed transfer may be
effected without registration under the Securities Act or applicable Blue Sky
Laws. The prospective transferee or purchaser will also execute such documents
and make such representations, warranties, and agreements as may be required
solely to comply with the exemptions relied upon by the Company for the transfer
or disposition of the Warrant or Warrant Shares.
 
8. Fractional Shares.  Fractional shares will not be issued upon the exercise of
this Warrant, but in any case where the holder would, except for the provisions
of this Section, be entitled under the terms hereof to receive a fractional
share, the number of Shares will be rounded up to the nearest whole Share.
 
9. Governing Law.  This Warrant shall be governed by the laws of the State of
Delaware.
 
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its duly
authorized officer and this Warrant to be dated ____________, 2013.
 
U-VEND INTERNATIONAL, INC.
 
 
By: _______________________________
Name: _____________________________
Title: ______________________________

 

 
6

--------------------------------------------------------------------------------

 

SUBSCRIPTION FORM
(To be signed upon exercise of Warrant)
 
The undersigned, the holder of the within Warrant, hereby irrevocably elects to
exercise the purchase right represented by such Warrant for, and to purchase
thereunder, ____________ _________________ of the shares of Common Stock of
U-Vend International, Inc. to which such Warrant relates and herewith makes
payment of $__________________ therefore in cash or by certified check and
requests that the certificate for such shares be issued in the name of, and be
delivered to, ______________________, the address for which is set forth below
the signature of the undersigned.
 
Dated: __________________
 
____________________________________
(Signature)
 
____________________________________
(Name)
 
____________________________________
(Address)
 
____________________________________
Social Security or Tax Ident. No.

 
 
 
 
 

--------------------------------------------------------------------------------

 

ASSIGNMENT FORM
(To be signed upon authorized transfer of Warrant)
 
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers unto
______________________________ the right to purchase ____________ shares of
Common Stock of U-Vend International, Inc. to which the within Warrant relates
and appoints ___________________ attorney, to transfer said right on the books
of ________________ with full power of substitution in the premises.
 
Dated: __________________
 
 
____________________________________
(Signature)
 
____________________________________
(Name)
 
____________________________________
(Address)
 
____________________________________
Social Security or Tax Ident. No.

 
 
 

--------------------------------------------------------------------------------