Exhibit 10.3

 

THIS WARRANT AND THE SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THIS WARRANT AND THE
SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT BE SOLD, OFFERED FOR SALE,
PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT OR
APPLICABLE EXEMPTION OR SAFE HARBOR PROVISION.

 

 

COMMON STOCK PURCHASE WARRANT

DOCUMENT W-12022015

 

MYECHECK, INC.

 

Warrant Shares: 1,833,333  Initial Issue Date: December 2, 2015 Aggregate
Exercise Amount: $55,000   

 

THIS COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies that, for value
received, JMJ Financial, its Principal, or its assigns (the “Holder”) is
entitled, upon the terms and subject to the limitations on exercise and the
conditions hereinafter set forth, at any time on or after the date hereof (the
“Initial Exercise Date”) and on or prior to the close of business on the five
(5) year anniversary of the Initial Exercise Date (as subject to adjustment
hereunder, the “Termination Date”), to subscribe for and purchase from MYECHECK,
INC., a Wyoming corporation (the “Company”), up to 1,833,333 shares (as subject
to adjustment herein, the “Warrant Shares”) of common stock of the Company (the
“Common Stock”). The purchase price of one share of Common Stock under this
Warrant shall be equal to the Exercise Price, as defined in Section 1.2.

ARTICLE 1EXERCISE RIGHTS

 

The Holder will have the right to exercise this Warrant to purchase shares of
Common Stock as set forth below. Capitalized terms used and not otherwise
defined herein shall have the meanings set forth in that certain Securities
Purchase Agreement Document SPA-12022015 dated December 2, 2015 between the
Company and the Holder (the “Agreement”).

1.1           Exercise of Warrant. Exercise of the purchase rights represented
by this Warrant may be made, in whole or in part, from and after the Initial
Exercise Date, and then at any time, by delivery to the Company (or such other
office or agency of the Company as it may designate by notice in writing to the
registered Holder at the address of the Holder appearing on the books of the
Company) of a duly executed facsimile or emailed copy of the Notice of Exercise
form annexed hereto. Within three (3) business days following the date of
exercise as aforesaid, the Holder shall deliver the aggregate Exercise Price for
the shares specified in the applicable Notice of Exercise by wire transfer or
check drawn on a United States bank unless the cashless exercise procedure
specified in Section 1.3 below is specified in the applicable Notice of
Exercise. Partial exercises of this Warrant resulting in purchases of a portion
of the total number of Warrant Shares available hereunder shall have the effect
of lowering the outstanding number of Warrant Shares purchasable hereunder in an
amount equal to the applicable number of Warrant Shares purchased. The Holder
and the Company shall maintain records showing the number of Warrant Shares
purchased and the date of such purchases. The Company shall deliver any
objection to any Notice of Exercise form within 24 hours of receipt of such
notice. The Holder and any assignee, by acceptance of this Warrant, acknowledge
and agree that, by reason of the provisions of this paragraph, following the
purchase of a portion of the Warrant Shares hereunder, the number of Warrant
Shares available for purchase hereunder at any given time may be less than the
amount stated on the face hereof.

1.2           Exercise Price. The exercise price per share of Common Stock under
this Warrant shall be $0.03 per share, subject to adjustment hereunder (the
“Exercise Price”). The aggregate exercise price is $55,000.

1.3           Cashless Exercise. If at any time after the earlier of (i) the six
(6) month anniversary of the date of the Agreement and (ii) the completion of
the then-applicable holding period required by Rule 144, or any successor
provision then in effect, there is no effective Registration Statement
registering, or no current prospectus available for, the resale of the Warrant
Shares by the Holder, then this Warrant may also be exercised, in whole or in
part, at such time by means of a “cashless exercise” in which the Holder shall
be entitled to receive a number of Warrant Shares equal to the quotient obtained
by dividing [(A-B) (X)] by (A), where:

 1 

 

(A) = the VWAP on the trading day immediately preceding the date on which Holder
elects to exercise this Warrant by means of a “cashless exercise,” as set forth
in the applicable Notice of Exercise;

 

(B) = the Exercise Price of this Warrant, as adjusted hereunder; and

 

(X) = the number of Warrant Shares that would be issuable upon exercise of this
Warrant in accordance with the terms of this Warrant if such exercise were by
means of a cash exercise rather than a cashless exercise.

 

1.4           Termination. On the Termination Date, if all or any portion of
this Warrant remains unexercised, the Termination Date shall be automatically
extended for two years.

1.5           Delivery of Warrant Shares. Warrant Shares purchased hereunder
will be delivered to Holder by 2:30 pm EST within two (2) business days of
Notice of Exercise by “DWAC/FAST” electronic transfer (such date, the “Warrant
Share Delivery Date”). For example, if Holder delivers a Notice of Exercise to
the Company at 5:15 pm eastern time on Monday January 1st, the Company’s
transfer agent must deliver shares to Holder’s broker via “DWAC/FAST” electronic
transfer by no later than 2:30 pm eastern time on Wednesday January 3rd. The
Warrant Shares shall be deemed to have been issued, and Holder or any other
person so designated to be named therein shall be deemed to have become a holder
of record of such shares for all purposes, as of the date of delivery of the
Notice of Exercise. Holder may assess penalties or liquidated damages (both
referred to herein as “penalties”) as follows. For each exercise, in the event
that shares are not delivered by the third business day (inclusive of the day of
exercise), the Company shall pay the Holder in cash a penalty of $2,000 per day
for each day after the third business day (inclusive of the day of exercise)
until share delivery is made. The Company will not be subject to any penalties
once its transfer agent correctly processes the shares to the DWAC system. The
Company will make its best efforts to deliver the Warrant Shares to the Holder
the same day or next day.

1.6           Delivery of Warrant. The Holder shall not be required to
physically surrender this Warrant to the Company. If the Holder has purchased
all of the Warrant Shares available hereunder and the Warrant has been exercised
in full, this Warrant shall automatically be cancelled without the need to
surrender the Warrant to the Company for cancellation. If this Warrant shall
have been exercised in part, the Company shall, at the request of Holder and
upon surrender of this Warrant, at the time of delivery of the Warrant Shares,
deliver to the Holder a new Warrant evidencing the rights of the Holder to
purchase the unpurchased Warrant Shares called for by this Warrant, which new
Warrant shall in all other respects be identical with this Warrant and, for
purposes of Rule 144, shall tack back to the original date of this Warrant.

1.7           Warrant Exercise Rescission Rights. For any reason in Holder’s
sole discretion, including if the Warrant Shares are not delivered by DWAC/FAST
electronic transfer or in accordance with the timeframe stated in Section 1.5,
or for any other reason, Holder may, at any time prior to selling those Warrant
Shares rescind such exercise, in whole or in part, in which case the Company
must, within three (3) days of receipt of notice from the Holder, repay to the
Holder the portion of the exercise price so rescinded and reinstate the portion
of the Warrant and equivalent number of Warrant Shares for which the exercise
was rescinded and, for purposes of Rule 144, such reinstated portion of the
Warrant and the Warrant Shares shall tack back to the original date of this
Warrant. If Warrant Shares were issued to Holder prior to Holder’s rescission
notice, upon return of payment from the Company, Holder will, within three (3)
days of receipt of payment, commence procedures to return the Warrant Shares to
the Company.

1.8           Compensation for Buy-In on Failure to Timely Deliver Certificates
Upon Exercise. In addition to any other rights available to the Holder, if the
Company fails to cause its transfer agent to transmit to the Holder the Warrant
Shares on or before the Warrant Share Delivery Date, and if after such date the
Holder is required by its broker to purchase (in an open market transaction or
otherwise) or the Holder’s brokerage firm otherwise purchases, shares of Common
Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares
which the Holder anticipated receiving upon such exercise (a “Buy-In”), then the
Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the
Holder’s total purchase price (including brokerage commissions and other fees,
if any) for the shares of Common Stock so purchased exceeds (y) the amount
obtained by multiplying (1) the number of Warrant Shares that the Company was
required to deliver to the Holder in connection with the exercise at issue times
(2) the price at which the sell order giving rise to such purchase obligation
was executed, and (B) at the option of the Holder, either (x) reinstate the
portion of the Warrant and equivalent number of Warrant Shares for which such
exercise was not honored (in which case such exercise shall be deemed
rescinded), (y) deliver to the Holder the number of shares of Common Stock that
would have been issued had the Company timely complied with its exercise and
delivery obligations hereunder, or (z) pay in cash to the Holder the amount
obtained by multiplying (1) the number of Warrant Shares that the Company was
required to deliver to the Holder in connection with the exercise at issue times
(2) the price at which the sell order giving rise to such purchase obligation
was executed. The Holder shall provide the Company written notice indicating the
amounts payable to the Holder in respect of the Buy-In and, upon request of the
Company, evidence of the amount of such loss.

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1.9           Make-Whole for Market Loss after Exercise. At the Holder’s
election, if the Company fails for any reason to deliver to the Holder the
Warrant Shares by DWAC/FAST electronic transfer (such as by delivering a
physical certificate) and if the Holder incurs a Market Price Loss, then at any
time subsequent to incurring the loss the Holder may provide the Company written
notice indicating the amounts payable to the Holder in respect of the Market
Price Loss and the Company must make the Holder whole as follows:

Market Price Loss = [(High trade price on the day of exercise) x (Number of
Warrant Shares)] – [(Sales price realized by Holder) x (Number of Warrant
Shares)]

 

The Company must pay the Market Price Loss by cash payment, and any such cash
payment must be made by the third business day from the time of the Holder’s
written notice to the Company.

 

1.10           Make-Whole for Failure to Deliver Loss. At the Holder’s election,
if the Company fails for any reason to deliver to the Holder the Warrant Shares
by the Warrant Share Delivery Date and if the Holder incurs a Failure to Deliver
Loss, then at any time the Holder may provide the Company written notice
indicating the amounts payable to the Holder in respect of the Failure to
Deliver Loss and the Company must make the Holder whole as follows:

Failure to Deliver Loss = [(High trade price at any time on or after the day of
exercise) x (Number of Warrant Shares)]

 

The Company must pay the Failure to Deliver Loss by cash payment, and any such
cash payment must be made by the third business day from the time of the
Holder’s written notice to the Company.

 

1.11           Choice of Remedies. Nothing herein, including, but not limited
to, Holder’s electing to pursue its rights under Sections 1.9 or 1.10 of this
Warrant, shall limit a Holder’s right to pursue any other remedies available to
it hereunder, at law or in equity including, without limitation, a decree of
specific performance and/or injunctive relief with respect to the Company’s
failure to timely deliver shares of Common Stock upon exercise of the Warrant as
required pursuant to the terms hereof.

1.12           Charges, Taxes and Expenses. Issuance of Warrant Shares shall be
made without charge to the Holder for any issue or transfer tax or other
incidental expense in respect of the issuance of such shares, all of which taxes
and expenses shall be paid by the Company, and such Warrant Shares shall be
issued in the name of the Holder or in such name or names as may be directed by
the Holder. The Company shall pay all transfer agent fees required for same-day
processing of any Notice of Exercise.

1.13           Holder’s Exercise Limitations. Unless otherwise agreed in writing
by both the Company and the Holder, at no time will the Holder exercise any
amount of this Warrant to purchase Common Stock that would result in the Holder
owning more than 4.99% of the Common Stock outstanding of the Company (the
“Beneficial Ownership Limitation”). Upon the written or oral request of Holder,
the Company shall within twenty-four (24) hours confirm orally and in writing to
the Holder the number of shares of Common Stock then outstanding.

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ARTICLE 2ADJUSTMENTS

2.1           Stock Dividends and Splits. If the Company, at any time while this
Warrant is outstanding: (i) pays a stock dividend or otherwise makes a
distribution or distributions on shares of its Common Stock or any other equity
or equity equivalent securities payable in shares of Common Stock (which, for
avoidance of doubt, shall not include any shares of Common Stock issued by the
Company upon exercise of this Warrant), (ii) subdivides outstanding shares of
Common Stock into a larger number of shares, (iii) combines (including by way of
reverse stock split) outstanding shares of Common Stock into a smaller number of
shares or (iv) issues by reclassification of shares of the Common Stock any
shares of capital stock of the Company, then in each case the Exercise Price
shall be multiplied by a fraction of which the numerator shall be the number of
shares of Common Stock (excluding treasury shares, if any) outstanding
immediately before such event and of which the denominator shall be the number
of shares of Common Stock outstanding immediately after such event, and the
number of shares issuable upon exercise of this Warrant shall be proportionately
adjusted such that the aggregate Exercise Price of this Warrant shall remain
unchanged. Any adjustment made pursuant to this Section 2.1 shall become
effective immediately after the record date for the determination of
stockholders entitled to receive such dividend or distribution and shall become
effective immediately after the effective date in the case of a subdivision,
combination or re-classification.

2.2           Subsequent Equity Sales. If the Company or any Subsidiary thereof,
as applicable, at any time while this Warrant is outstanding, shall sell or
grant any option to purchase, or sell or grant any right to reprice, or
otherwise dispose of or issue (or announce any offer, sale, grant or any option
to purchase or other disposition) any Common Stock (including pursuant to the
terms of any outstanding securities issued prior to the issuance of this
security (including, but not limited to, warrants, convertible notes, or other
agreements)) or any security entitling the holder thereof (including sales or
grants to the Holder) to acquire Common Stock, including, without limitation,
any debt, preferred stock, right, option, warrant or other instrument that is
convertible into or exercisable or exchangeable for, or otherwise entitles the
holder thereof to receive, Common Stock (a “Common Stock Equivalent”), at an
effective price per share less than the Exercise Price then in effect (such
lower price, the “Base Share Price” and such issuances collectively, a “Dilutive
Issuance”) (it being understood and agreed that if the holder of the Common
Stock or Common Stock Equivalents so issued shall at any time, whether by
operation of purchase price adjustments, reset provisions, floating conversion,
exercise or exchange prices or otherwise, or due to warrants, options or rights
per share which are issued in connection with such issuance, be entitled to
receive shares of Common Stock at an effective price per share that is less than
the Exercise Price, such issuance shall be deemed to have occurred for less than
the Exercise Price on such date of the Dilutive Issuance at such effective price
regardless of whether such holder has received or ever receives shares at such
effective price), then simultaneously with the consummation of each Dilutive
Issuance the Exercise Price shall be reduced and only reduced to equal the Base
Share Price and consequently the number of Warrant Shares issuable hereunder
shall be increased such that the Aggregate Exercise Amount hereunder, after
taking into account the decrease in the Exercise Price, shall be equal to the
Aggregate Exercise Amount prior to such adjustment. Such adjustment shall be
made whenever such Common Stock or Common Stock Equivalents are issued. The
Company shall notify the Holder, in writing, no later than the business day
following the issuance or deemed issuance of any Common Stock or Common Stock
Equivalents subject to this Section 2.2, indicating therein the applicable
issuance price, or applicable reset price, exchange price, conversion price and
other pricing terms (such notice, the “Dilutive Issuance Notice”). In addition,
the Company shall provide the Holder, whenever the Holder requests at any time
while this Warrant is outstanding, a schedule of all issuances of Common Stock
or Common Stock Equivalents since the date of the Agreement, including the
applicable issuance price, or applicable reset price, exchange price, conversion
price, exercise price and other pricing terms. The term issuances shall also
include all agreements to issue, or prospectively issue Common Stock or Common
Stock Equivalents, regardless of whether the issuance contemplated by such
agreement is consummated. The Company shall notify the Holder in writing of any
issuances within twenty-four (24) hours of such issuance. For purposes of
clarification, whether or not the Company provides a Dilutive Issuance Notice
pursuant to this Section 2.2, upon the occurrence of any Dilutive Issuance, the
Holder is entitled to receive a number of Warrant Shares based upon the Base
Share Price regardless of whether the Holder accurately refers to the Base Share
Price in the Notice of Exercise. If the Company enters into a Variable Rate
Transaction, the Company shall be deemed to have issued Common Stock or Common
Stock Equivalents at the lowest possible conversion or exercise price at which
such securities may be converted or exercised. “Variable Rate Transaction” means
a transaction in which the Company (i) issues or sells any debt or equity
securities that are convertible into, exchangeable or exercisable for, or
include the right to receive, additional shares of Common Stock either (A) at a
conversion price, exercise price or exchange rate or other price that is based
upon, and/or varies with, the trading prices of or quotations for the shares of
Common Stock at any time after the initial issuance of such debt or equity
securities or (B) with a conversion, exercise or exchange price that is subject
to being reset at some future date after the initial issuance of such debt or
equity security or upon the occurrence of specified or contingent events
directly or indirectly related to the business of the Company or the market for
the Common Stock or (ii) enters into any agreement, including, but not limited
to, an equity line of credit, whereby the Company may sell securities at a
future determined price.

 4 

 

2.3           Subsequent Rights Offerings. In addition to any adjustments
pursuant to Section 2.1 or 2.2 above, if at any time the Company grants, issues
or sells any Common Stock Equivalents or rights to purchase stock, warrants,
securities or other property pro rata to the record holders of any class of
shares of Common Stock (the “Purchase Rights”), then the Holder will be entitled
to acquire, upon the terms applicable to such Purchase Rights, the aggregate
Purchase Rights which the Holder could have acquired if the Holder had held the
number of shares of Common Stock acquirable upon complete exercise of this
Warrant (without regard to any limitations on exercise hereof, including without
limitation, the Beneficial Ownership Limitation) immediately before the date on
which a record is taken for the grant, issuance or sale of such Purchase Rights,
or, if no such record is taken, the date as of which the record holders of
shares of Common Stock are to be determined for the grant, issue or sale of such
Purchase Rights (provided, however, to the extent that the Holder’s right to
participate in any such Purchase Right would result in the Holder exceeding the
Beneficial Ownership Limitation, then the Holder shall not be entitled to
participate in such Purchase Right to such extent (or beneficial ownership of
such shares of Common Stock as a result of such Purchase Right to such extent)
and such Purchase Right to such extent shall be held in abeyance for the Holder
until such time, if ever, as its right thereto would not result in the Holder
exceeding the Beneficial Ownership Limitation).

2.4           Pro Rata Distributions. If the Company, at any time while this
Warrant is outstanding, shall distribute to all holders of Common Stock (and not
to the Holder) evidences of its indebtedness or assets (including cash and cash
dividends) or rights or warrants to subscribe for or purchase any security other
than the Common Stock (which shall be subject to Section 2.3), then in each such
case the Exercise Price shall be adjusted by multiplying the Exercise Price in
effect immediately prior to the record date fixed for determination of
stockholders entitled to receive such distribution by a fraction of which the
denominator shall be the VWAP determined as of the record date mentioned above,
and of which the numerator shall be such VWAP on such record date less the then
per share fair market value at such record date of the portion of such assets or
evidence of indebtedness or rights or warrants so distributed applicable to one
outstanding share of the Common Stock as determined by the Board of Directors in
good faith. In either case the adjustments shall be described in a statement
provided to the Holder of the portion of assets or evidences of indebtedness so
distributed or such subscription rights applicable to one share of Common Stock.
Such adjustment shall be made whenever any such distribution is made and shall
become effective immediately after the record date mentioned above.

2.5           Notice to Holder. Whenever the Exercise Price is adjusted pursuant
to any provision of this Article 2, the Company shall promptly notify the Holder
(by written notice) setting forth the Exercise Price after such adjustment and
any resulting adjustment to the number of Warrant Shares and setting forth a
brief statement of the facts requiring such adjustment.

ARTICLE 3COMPANY COVENANTS

3.1           Reservation of Shares. As set forth in Section 2.2 of document
SPA-12022015, as of the issuance date of this Warrant and for the remaining
period during which the Warrant is exercisable, the Company will reserve from
its authorized and unissued Common Stock a sufficient number of shares to
provide for the issuance of Warrant Shares upon the full exercise of this
Warrant. The Company represents that upon issuance, such Warrant Shares will be
duly and validly issued, fully paid and non-assessable. The Company agrees that
its issuance of this Warrant constitutes full authority to its officers, agents
and transfer agents who are charged with the duty of executing and issuing
shares to execute and issue the necessary Warrant Shares upon the exercise of
this Warrant. No further approval or authority of the stockholders of the Board
of Directors of the Company is required for the issuance of the Warrant Shares.

 5 

 

3.2           No Adverse Actions. Except and to the extent as waived or
consented to by the Holder, the Company shall not by any action, including,
without limitation, amending its certificate of incorporation or through any
reorganization, transfer of assets, consolidation, merger, dissolution, issue or
sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of this Warrant, but will at all
times in good faith assist in the carrying out of all such terms and in the
taking of all such actions as may be necessary or appropriate to protect the
rights of Holder as set forth in this Warrant against impairment. Without
limiting the generality of the foregoing, the Company will (i) not increase the
par value of any Warrant Shares above the amount payable therefor upon such
exercise immediately prior to such increase in par value, (ii) take all such
action as may be necessary or appropriate in order that the Company may validly
and legally issue fully paid and non-assessable Warrant Shares upon the exercise
of this Warrant and (iii) use commercially reasonable efforts to obtain all such
authorizations, exemptions or consents from any public regulatory body having
jurisdiction thereof, as may be, necessary to enable the Company to perform its
obligations under this Warrant.

ARTICLE 4MISCELLANEOUS

4.1           Representation by the Holder. The Holder, by the acceptance
hereof, represents and warrants that it is acquiring this Warrant and, upon any
exercise hereof, will acquire the Warrant Shares issuable upon such exercise,
for its own account and not with a view to or for distributing or reselling such
Warrant Shares or any part thereof in violation of the Securities Act or any
applicable state securities law, except pursuant to sales registered or exempted
under the Securities Act.

4.2           Transferability. Subject to compliance with any applicable
securities laws, this Warrant and all rights hereunder (including, without
limitation, any registration rights) are transferable, in whole or in part, by a
written assignment of this Warrant duly executed by the Holder or its agent or
attorney. If necessary to obtain a new warrant for any assignee, the Company,
upon surrender of this Warrant, shall execute and deliver a new Warrant or
Warrants in the name of the assignee or assignees, as applicable, and in the
denomination or denominations specified in such instrument of assignment, and
shall issue to the assignor a new Warrant evidencing the portion of this Warrant
not so assigned, and such new Warrants, for purposes of Rule 144, shall tack
back to the original date of this Warrant. The Warrant, if properly assigned in
accordance herewith, may be exercised by a new holder for the purchase of
Warrant Shares without having a new Warrant issued.

4.3           Assignability. The Company may not assign this Warrant. This
Warrant will be binding upon the Company and its successors, and will inure to
the benefit of the Holder and its successors and assigns, and may be assigned by
the Holder to anyone of its choosing without the Company’s approval.

4.4           Notices. Any notice required or permitted hereunder must be in
writing and either personally served, sent by facsimile or email transmission,
or sent by overnight courier. Notices will be deemed effectively delivered at
the time of transmission if by facsimile or email, and if by overnight courier
the business day after such notice is deposited with the courier service for
delivery.

4.5           Governing Law. This Warrant will be governed by, and construed and
enforced in accordance with, the laws of the State of Nevada, without regard to
the conflict of laws principles thereof. Any action brought by either party
against the other concerning the transactions contemplated by this Warrant shall
be brought only in the state courts of Florida or in the federal courts located
in Miami-Dade County, in the State of Florida. Both parties and the individuals
signing this Agreement agree to submit to the jurisdiction of such courts.

 

4.6           Delivery of Process by Holder to the Company. In the event of any
action or proceeding by Holder against the Company, and only by Holder against
the Company, service of copies of summons and/or complaint and/or any other
process which may be served in any such action or proceeding may be made by
Holder via U.S. Mail, overnight delivery service such as FedEx or UPS, email,
fax, or process server, or by mailing or otherwise delivering a copy of such
process to the Company at its last known address or to its last known attorney
set forth in its most recent SEC filing.

4.7           No Rights as Stockholder Until Exercise. This Warrant does not
entitle the Holder to any voting rights, dividends or other rights as a
stockholder of the Company prior to the exercise hereof as set forth in Section
1.1. So long as this Warrant is unexercised, this Warrant carries no voting
rights and does not convey to the Holder any “control” over the Company, as such
term may be interpreted by the SEC under the Securities Act or the Exchange Act,
regardless of whether the price of the Company’s Common Stock exceeds the
Exercise Price.

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4.8           Limitation of Liability. No provision hereof, in the absence of
any affirmative action by the Holder to exercise this Warrant to purchase
Warrant Shares, and no enumeration herein of the rights or privileges of the
Holder, shall give rise to any liability of the Holder for the purchase price of
any Common Stock or as a stockholder of the Company, whether such liability is
asserted by the Company or by creditors of the Company.

4.9           Attorney Fees. In the event any attorney is employed by either
party to this Warrant with regard to any legal or equitable action, arbitration
or other proceeding brought by such party for the enforcement of this Warrant or
because of an alleged dispute, breach, default or misrepresentation in
connection with any of the provisions of this Warrant, the prevailing party in
such proceeding will be entitled to recover from the other party reasonable
attorneys’ fees and other costs and expenses incurred, in addition to any other
relief to which the prevailing party may be entitled.

4.10           Opinion of Counsel. In the event that an opinion of counsel is
needed for any matter related to this Warrant, Holder has the right to have any
such opinion provided by its counsel. Holder also has the right to have any such
opinion provided by the Company’s counsel.

4.11           Nonwaiver. No course of dealing or any delay or failure to
exercise any right hereunder on the part of Holder shall operate as a waiver of
such right or otherwise prejudice the Holder’s rights, powers or remedies.

4.12           Amendment Provision. The term “Warrant” and all references
thereto, as used throughout this instrument, means this instrument as originally
executed, or if later amended or supplemented, then as so amended or
supplemented.

4.13           No Shorting. Holder agrees that so long as this Warrant remains
unexercised in whole or in part, Holder will not enter into or effect any “short
sale” of the common stock or hedging transaction which establishes a net short
position with respect to the common stock of the Company. The Company
acknowledges and agrees that as of the date of delivery to the Company of a
fully and accurately completed Notice of Exercise, Holder immediately owns the
common shares described in the Notice of Exercise and any sale of those shares
issuable under such Notice of Exercise would not be considered short sales.

*           *           *

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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its
officer thereunto duly authorized as of the date first above indicated.

  MYECHECK, INC.                     By: /s/ Edward R. Starrs       Edward R.
Starrs       Chief Executive Officer                     HOLDER:                
    /s/ JMJ Financial     JMJ Financial / Its Principal  

 

 

 

           

 8 

 

 

NOTICE OF EXERCISE

 

To:           MYECHECK, INC.

 

(1)           The undersigned hereby elects to purchase ________ Warrant Shares
of the Company pursuant to the terms of the attached Warrant (only if exercised
in full), and tenders herewith payment of the exercise price in full, together
with all applicable transfer taxes, if any.

(2)           Payment shall take the form of (check applicable box):

[  ] in lawful money of the United States; or

[  ] the cancellation of such number of Warrant Shares as is necessary, in
accordance with the formula set forth in Section 1.3, to exercise this Warrant
with respect to the maximum number of Warrant Shares purchasable pursuant to the
cashless exercise procedure set forth in Section 1.3.

(3)           Please issue a certificate or certificates representing said
Warrant Shares in the name of the undersigned or in such other name as is
specified below:

_______________________________

 

 

The Warrant Shares shall be delivered to the following DWAC Account Number:

 

_______________________________

 

_______________________________

 

_______________________________

 

(4) Accredited Investor. The undersigned is an “accredited investor” as defined
in Regulation D promulgated under the Securities Act of 1933, as amended.

 

[SIGNATURE OF HOLDER]

 

 

Name: _______________________________________

Date: ________________________________________