Exhibit 10.3

 

NEITHER THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON EXERCISE OF THESE
SECURITIES HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), 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
OR (B) AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH
APPLICABLE STATE SECURITIES LAWS OR BLUE SKY LAWS AS EVIDENCED BY A LEGAL
OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY AND ITS TRANSFER AGENT
OR (II) UNLESS SOLD PURSUANT TO RULE 144 UNDER THE SECURITIES 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.

GTX CORP.

WARRANT TO PURCHASE COMMON STOCK

 

Warrant No. 1 Original Issue Date: July 24, 2013

 

GTX Corp., a Nevada corporation (the “Company”), hereby certifies that, for
value received, Atlantic Footcare, Inc. or its permitted registered assigns (the
“Holder”), is entitled to purchase from the Company a total number of shares of
common stock, $0.001 par value per share (the “Common Stock”), of the Company
(each such share, a “Warrant Share” and all such shares, the “Warrant Shares”),
such that, when added to the number total number of shares of Common Stock
acquired by Holder upon conversion of that certain $200,000.00 Promissory Note
of even date herewith issued by the Company in favor of the Holder (the “Note”),
shall constitute an amount of shares equal to 12% of the Common Stock
outstanding as of the date of such conversion as such total outstanding amount
may, from time to time, be increased after the date hereof by issuances of
Common Stock occurring on or prior to November 13, 2014 or by issuances of
Common Stock occurring after November 13, 2014 but pursuant to convertible
instruments issued or commitments made by the Company prior to November 13, 2014
other than issuances of Excluded Securities as such term is defined in the Note
(“Additional Issuances”), at an exercise price per share equal to $0.001 per
share, at any time and from time to time on or after the date hereof (the
“Original Issue Date”) and through and including 5:30 P.M., eastern standard
time, on November 13, 2020 (the “Expiration Date”). This Warrant may be
exercised multiple times to the extent necessary to reflect any such Additional
Issuances and shall be subject to the following terms and conditions:

This Warrant (this “Warrant”) is issued pursuant to that certain Securities
Purchase Agreement (the “Purchase Agreement”), dated July 24, 2013, by and among
the Company and the Holder.

1.                   Definitions. In addition to the terms defined elsewhere in
this Warrant, capitalized terms that are not otherwise defined herein have the
meanings given to such terms in the Purchase Agreement.

2.                   Registration of Warrants. The Company shall register this
Warrant, upon records to be maintained by the Company for that purpose (the
“Warrant Register”), in the name of the record Holder (which shall include the
initial Holder or, as the case may be, any registered assignee to which this
Warrant is permissibly assigned hereunder) from time to time. The Company may
deem and treat the registered Holder of this Warrant as the absolute owner
hereof for the purpose of any exercise hereof or any distribution to the Holder,
and for all other purposes, absent actual notice to the contrary.

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3.                   Exercise and Duration of Warrants.

(a)                All or any part of this Warrant shall be exercisable by the
registered Holder of this Warrant at any time and from time to time on or after
the Original Issue Date and through and including 5:30 P.M. eastern standard
time, on the Expiration Date. At 5:30 P.M., eastern standard time, on the
Expiration Date, the portion of this Warrant not exercised prior thereto shall
be and become void and of no value and this Warrant shall be terminated and no
longer outstanding.

(b)                The Holder may exercise this Warrant by delivering (whether
via facsimile or otherwise) to the Company an exercise notice, in the form
attached as Schedule 1 hereto (the “Exercise Notice”), completed and duly
signed, and the date on which the Exercise Notice is delivered to the Company
(as determined in accordance with the notice provisions hereof) is an “Exercise
Date.” Within one (1) Trading Day following an exercise of this Warrant as
aforesaid, the Holder shall deliver payment of the exercise price for the number
of Warrant Shares as to which this Warrant is being exercised in cash or via
wire transfer of immediately available funds. The Company shall deliver any
objection to any Exercise Notice within one (1) Trading Day of receipt of such
notice. The Holder shall not be required to deliver the original Warrant in
order to effect an exercise hereunder, until this Warrant has been exercised in
full, in which case the Holder shall surrender this Warrant to the Company for
cancellation within three (3) Trading Days of the date the final Exercise Notice
is delivered to the Company. Execution and delivery of the Exercise Notice shall
have the same effect as cancellation of the original Warrant and issuance of a
New Warrant evidencing the right to purchase the remaining number of Warrant
Shares.

4.                   Delivery of Warrant Shares.

(a)                Upon exercise of this Warrant, the Company shall promptly
(but in no event later than the later of (i) three (3) Trading Days after the
Exercise Date and (ii) two (2) Trading Days after the Company’s receipt of the
applicable aggregate exercise price) issue or cause to be issued and cause to be
delivered to or upon the written order of the Holder and in such name or names
as the Holder may designate (provided that, if the Registration Statement is not
effective and the Holder directs the Company to deliver a certificate for the
Warrant Shares in a name other than that of the Holder or an Affiliate of the
Holder, it shall deliver to the Company on the Exercise Date an opinion of
counsel reasonably satisfactory to the Company to the effect that the issuance
of such Warrant Shares in such other name may be made pursuant to an available
exemption from the registration requirements of the Securities Act and all
applicable state securities or blue sky laws), (i) a certificate for the Warrant
Shares issuable upon such exercise, free of restrictive legends, or (ii) an
electronic delivery of the Warrant Shares to the Holder’s account at the
Depository Trust Company (“DTC”) or a similar organization, unless in the case
of clause (i) and (ii) a registration statement covering the resale of the
Warrant Shares and naming the Holder as a selling stockholder thereunder is not
then effective or the Warrant Shares are not freely transferable without volume
and manner of sale restrictions pursuant to Rule 144 under the Securities Act
and without the requirement for the Company to be in compliance with the current
public information under Rule 144(c)(1), in which case such Holder shall receive
a certificate for the Warrant Shares issuable upon such exercise with
appropriate restrictive legends. The Holder, or any Person permissibly so
designated by the Holder to receive Warrant Shares, shall be deemed to have
become the holder of record of such Warrant Shares as of the Exercise Date. If
the Warrant Shares are to be issued free of all restrictive legends, the Company
shall, upon the written request of the Holder, use its reasonable best efforts
to deliver, or cause to be delivered, Warrant Shares hereunder electronically
through DTC or another established clearing corporation performing similar
functions, if available; provided, that, the Company may, but will not be
required to, change its transfer agent if its current transfer agent cannot
deliver Warrant Shares electronically through such a clearing corporation.

(b)                To the extent permitted by law, the Company’s obligations to
issue and deliver Warrant Shares in accordance with and subject to the terms
hereof are absolute and unconditional, irrespective of any action or inaction by
the Holder to enforce the same, any waiver or consent with respect to any
provision hereof, the recovery of any judgment against any Person or any action
to enforce the same, or any setoff, counterclaim, recoupment, limitation or
termination, or any breach or alleged breach by the Holder or any other Person
of any obligation to the Company or any violation or alleged violation of law by
the Holder or any other Person, and irrespective of any other circumstance that
might otherwise limit such obligation of the Company to the Holder in connection
with the issuance of Warrant Shares. Nothing herein shall limit the 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 or
injunctive relief with respect to the Company’s failure to timely deliver
certificates representing shares of Common Stock upon exercise of the Warrant as
required pursuant to the terms hereof.

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5.                   Charges, Taxes and Expenses. Issuance and delivery of
certificates for shares of Common Stock upon exercise of this Warrant shall be
made without charge to the Holder for any issue or transfer tax, transfer agent
fee or other incidental tax or expense in respect of the issuance of such
certificates, all of which taxes and expenses shall be paid by the Company;
provided, however, that the Company shall not be required to pay any tax that
may be payable in respect of any transfer involved in the registration of any
certificates for Warrant Shares or the Warrants in a name other than that of the
Holder or an Affiliate thereof. The Holder shall be responsible for all other
tax liability that may arise as a result of holding or transferring this Warrant
or receiving Warrant Shares upon exercise hereof.

6.                   Replacement of Warrant. If this Warrant is mutilated, lost,
stolen or destroyed, the Company shall issue or cause to be issued in exchange
and substitution for and upon cancellation hereof, or in lieu of and
substitution for this Warrant, a New Warrant, but only upon receipt of evidence
reasonably satisfactory to the Company of such loss, theft or destruction (in
such case) and, in each case, a customary and reasonable indemnity and surety
bond, if requested by the Company. Applicants for a New Warrant under such
circumstances shall also comply with such other reasonable regulations and
procedures and pay such other reasonable third-party costs as the Company may
prescribe. If a New Warrant is requested as a result of a mutilation of this
Warrant, then the Holder shall deliver such mutilated Warrant to the Company as
a condition precedent to the Company’s obligation to issue the New Warrant.

7.                   Reservation of Warrant Shares. The Company covenants that
it will at all times reserve and keep available out of the aggregate of its
authorized but unissued and otherwise unreserved Common Stock, solely for the
purpose of enabling it to issue Warrant Shares upon exercise of this Warrant as
herein provided, the number of Warrant Shares that are initially issuable and
deliverable upon the exercise of this entire Warrant, free from preemptive
rights or any other contingent purchase rights of persons other than the Holder.
The Company covenants that all Warrant Shares so issuable and deliverable shall,
upon issuance and the payment of the applicable exercise price in accordance
with the terms hereof, be duly and validly authorized, issued and fully paid and
nonassessable. The Company will take all such action as may be reasonably
necessary to assure that such shares of Common Stock may be issued as provided
herein without violation of any applicable law or regulation, or of any
requirements of any securities exchange or automated quotation system upon which
the Common Stock may be listed.

8.                   Payment of Exercise Price. The Holder shall pay the
exercise price in immediately available funds.

9.                   No Fractional Shares. No fractional Warrant Shares will be
issued in connection with any exercise of this Warrant. In lieu of any
fractional shares that would otherwise be issuable, the number of Warrant Shares
to be issued shall be rounded down to the next whole number and the Company
shall pay the Holder in cash the fair market value (based on the Closing Sale
Price) for any such fractional shares.

10.               Notices. Whenever notice is required to be given under this
Warrant, unless otherwise provided herein, such notice shall be given in
accordance with Section 5.5 of the Securities Purchase Agreement.

11.               Warrant Agent. The Company shall serve as warrant agent under
this Warrant. Upon thirty (30) days’ notice to the Holder, the Company may
appoint a new warrant agent. Any corporation into which the Company or any new
warrant agent may be merged or any corporation resulting from any consolidation
to which the Company or any new warrant agent shall be a party or any
corporation to which the Company or any new warrant agent transfers
substantially all of its corporate trust or shareholders services business shall
be a successor warrant agent under this Warrant without any further act. Any
such successor warrant agent shall promptly cause notice of its succession as
warrant agent to be mailed (by first class mail, postage prepaid) to the Holder
at the Holder’s last address as shown on the Warrant Register.

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12.               Miscellaneous.

(a)                No Rights as a Stockholder. The Holder, solely in such
Person’s capacity as a holder of this Warrant, shall not be entitled to vote or
receive dividends or be deemed the holder of share capital of the Company for
any purpose, nor shall anything contained in this Warrant be construed to confer
upon the Holder, solely in such Person’s capacity as the Holder of this Warrant,
any of the rights of a stockholder of the Company or any right to vote, give or
withhold consent to any corporate action (whether any reorganization, issue of
stock, reclassification of stock, consolidation, merger, amalgamation,
conveyance or otherwise), receive notice of meetings, receive dividends or
subscription rights, or otherwise, prior to the issuance to the Holder of the
Warrant Shares which such Person is then entitled to receive upon the due
exercise of this Warrant . In addition, nothing contained in this Warrant shall
be construed as imposing any liabilities on the Holder to purchase any
securities (upon exercise of this Warrant or otherwise) or as a stockholder of
the Company, whether such liabilities are asserted by the Company or by
creditors of the Company.

(b)                Successors and Assigns. Subject to the restrictions on
transfer set forth in this Warrant and in the Purchase Agreement, and compliance
with applicable securities laws, this Warrant may be assigned by the Holder.
This Warrant may not be assigned by the Company without the written consent of
the Holder. This Warrant shall be binding on and inure to the benefit of the
Company and the Holder and their respective successors and assigns. Subject to
the preceding sentence, nothing in this Warrant shall be construed to give to
any Person other than the Company and the Holder any legal or equitable right,
remedy or cause of action under this Warrant.

(c)                Amendment and Waiver. Except as otherwise provided herein,
this Warrant may be amended and the Company may take any action herein
prohibited, or omit to perform any act herein required to be performed by it,
only if the Company has obtained the written consent of the Holder. The Holder
shall be entitled, at its option, to the benefit of any amendment of any other
similar warrant issued under the Purchase Agreement. No waiver shall be
effective unless it is in writing and signed by an authorized representative of
the waiving party.

(d)                Acceptance. Receipt of this Warrant by the Holder shall
constitute acceptance of and agreement to all of the terms and conditions
contained herein.

(e)                Governing Law; Jurisdiction. ALL QUESTIONS CONCERNING THE
CONSTRUCTION, VALIDITY, ENFORCEMENT AND INTERPRETATION OF THIS WARRANT SHALL BE
GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAW THEREOF. EACH
OF THE COMPANY AND THE HOLDER HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE
JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY OF NEW YORK,
BOROUGH OF MANHATTAN, FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION HEREWITH OR WITH ANY TRANSACTION CONTEMPLATED HEREBY OR DISCUSSED
HEREIN (INCLUDING WITH RESPECT TO THE ENFORCEMENT OF ANY OF THE TRANSACTION
DOCUMENTS), AND HEREBY IRREVOCABLY WAIVES, AND AGREES NOT TO ASSERT IN ANY SUIT,
ACTION OR PROCEEDING, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE
JURISDICTION OF ANY SUCH COURT. EACH OF THE COMPANY AND THE HOLDER HEREBY
IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND CONSENTS TO PROCESS BEING
SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING BY MAILING A COPY THEREOF VIA
REGISTERED OR CERTIFIED MAIL OR OVERNIGHT DELIVERY (WITH EVIDENCE OF DELIVERY)
TO SUCH PERSON AT THE ADDRESS IN EFFECT FOR NOTICES TO IT UNDER THE PURCHASE
AGREEMENT 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 MANNER PERMITTED BY LAW.
EACH OF THE COMPANY AND THE HOLDER HEREBY WAIVES ALL RIGHTS TO A TRIAL BY JURY.

(f)                 Headings. The headings herein are for convenience only, do
not constitute a part of this Warrant and shall not be deemed to limit or affect
any of the provisions hereof.

(g)                Severability. In case any one or more of the provisions of
this Warrant shall be invalid or unenforceable in any respect, the validity and
enforceability of the remaining terms and provisions of this Warrant shall not
in any way be affected or impaired thereby, and the Company and the Holder will
attempt in good faith to agree upon a valid and enforceable provision which
shall be a commercially reasonable substitute therefor, and upon so agreeing,
shall incorporate such substitute provision in this Warrant.

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

 

 

GTX CORP.

 

 

By: /s/ Patrick Bertagna

Name: Patrick Bertagna

Title: President and CEO

 

 

 

 

 

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SCHEDULE 1

FORM OF EXERCISE NOTICE

[To be executed by the Holder to purchase shares of Common Stock under the
Warrant]

Ladies and Gentlemen:

The undersigned is the Holder of Warrant No. 1 (the “Warrant”) issued by GTX
Corp, a Nevada corporation (the “Company”). Capitalized terms used herein and
not otherwise defined herein have the respective meanings set forth in the
Warrant.

The undersigned hereby exercises its right to purchase __________ Warrant Shares
pursuant to the Warrant.

The Holder shall pay the sum of $___________ in immediately available funds to
the Company in accordance with the terms of the Warrant.

Pursuant to this Exercise Notice, the Company shall deliver to the Holder
Warrant Shares determined in accordance with the terms of the Warrant.

Dated:

 

Name of Holder:

 

By:

Name:

Title:

 

(Signature must conform in all respects to name of Holder as specified on the
face of the Warrant)