Exhibit 10.2 


 


THIS WARRANT AND THE SHARES OF COMMON
STOCK ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAWS
AND MAY NOT BE PLEDGED, HYPOTHECATED, SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS THEY HAVE BEEN REGISTERED UNDER SUCH ACT
AND ALL SUCH APPLICABLE LAWS OR AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND ALL SUCH APPLICABLE LAWS IS AVAILABLE AND, THE
COMPANY HAS RECEIVED AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY TO THE EFFECT THAT THE PROPOSED TRANSFER OR OTHER DISPOSITION
OF THESE SECURITIES MAY BE EFFECTED WITHOUT REGISTRATION UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS.


 


 


MGT CAPITAL INVESTMENTS, INC.


 


______________________________


 


COMMON STOCK WARRANT


______________________________


 


 


	Right to Purchase 350,000 shares	Certificate No. ________
	of Common Stock	Dated as of May 9, 2012


 


 


1.       Grant. In conjunction with the
Contribution and Sale Agreement (“Contribution and Sale Agreement”) by and among MGT Capital Investments, Inc.
(the “Company”), MGT Holdings, Inc. and J&S Gaming, Inc. (the “Investor”), the Company
hereby grants to the Investor the right to purchase 350,000 shares of Common Stock, par value $0.001 per share (“Common
Stock”), at the exercise price of $4.00 per share (the “Warrant Shares”). Capitalized terms used but
not otherwise defined herein will have the meaning ascribed to such terms in the Contribution and Sale Agreement.


 


2.       Exercise Period. The right to
exercise this Warrant shall commence as of the date hereof and shall expire on the earlier of (i) that date which is four (4) years
from the date hereof and (ii) the date that J&S exercises the Repurchase Right (the “Expiration Date”).


 


3.       Representations of Investor.
The Investor represents and warrants that the representations and warranties contained in Section 3.7 of the Contribution and Sale
Agreement are true and correct in all material respects as of the date of this Warrant. The Investor shall further reiterate the
representations and warranties contained in Section 3.7 of the Contribution and Sale Agreement as of each Exercise Date (as such
term is defined in Section 8 below).


 


4.       No Fractional Shares. No fractional
shares shall be issued upon the exercise of this Warrant. As to any fraction of a share which Investor would otherwise be entitled
to purchase upon such exercise, the Company shall pay a cash adjustment in respect of such final fraction in an amount equal to
the exercise price times such fraction.






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5.       Reservation of Common Stock.
The Company shall, at all times, reserve and keep available for issuance and delivery upon the exercise of this Warrant such number
of its authorized but unissued shares of Common Stock or other securities of the Company as will be sufficient to permit the exercise
in full of this Warrant. Upon such issuance, all such shares will be validly issued, fully paid and nonassessable, free and clear
of all liens, security interests, charges and other encumbrances or restrictions on sale and free and clear of all preemptive rights.


 


6.       Adjustments.


 


(a)       Adjustment for Certain Actions. If, after
the date hereof, the Company shall (i) pay a dividend or make a distribution on its capital stock in shares of Common Stock, (ii)
subdivide its outstanding shares of Common Stock into a greater number of shares, (iii) combine its outstanding shares of Common
Stock into a smaller number of shares or (iv) issue by reclassification of its Common Stock any shares of capital stock of the
Company, then the number of Warrant Shares available under the Warrant in the aggregate and the exercise price thereof shall be
correspondingly adjusted to give the Investor on exercise for the same aggregate exercise price, the number of shares of Common
Stock of the Company as the Investor would have owned had such Warrant been exercised immediately prior to the event and had the
Investor continued to hold such shares of Common Stock until after the event requiring adjustment.


 


(b)       Adjustment for Management Equity Compensation.
If, after the date hereof, the Company shall issue any New Shares, then the number of shares available under the Warrant shall
be correspondingly adjusted to give the Investor the same percentage ownership of the Company as the Investor would have owned
had such Warrant been exercised immediately prior to the issuance of New Shares and had the Investor continued to hold such shares
of Common Stock until after such issuance. For purposes of this Section 6(b), “New Shares” means (i) any shares granted
or (ii) shares issued pursuant to the exercise of options, in each case to executive officers of the Company pursuant to an equity
incentive plan of the Company.


 


7.       No Voting or Dividend Rights; Limitations
of Liability. Prior to exercise, this Warrant will not entitle the Investor to the right to vote or to consent or to receive
notice as a shareholder in respect of meetings of shareholders for the election of directors of the Company or any other matters
or any rights whatsoever as a shareholder of the Company. No dividends or interest shall be payable or accrued in respect of this
Warrant until, and only to the extent that, this Warrant shall have been exercised. No provision of this Warrant, in the absence
of affirmative action by the Investor to exercise this Warrant, and no enumeration in this Warrant of the rights or privileges
of the Investor, will give rise to any liability of such Investor for the exercise price.






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8.       Exercise Procedure.


 


(a)       This Warrant may be exercised in whole
or in part prior to the Expiration Date by presenting it and tendering the applicable exercise price, at the option of the Investor
(i) in legal tender, (ii) by bank cashier’s or certified check, at the principal office of the Company, or (iii) by wire
transfer to an account designated by Company, in each case along with a written subscription substantially in the form of Exhibit
A attached hereto. The date on which this Warrant is thus surrendered, accompanied by tender or payment as hereinbefore or
hereinafter provided, is referred to herein as the “Exercise Date.” The Company shall issue and deliver to Investor
certificates for the proper number of Warrant Shares upon exercise of this Warrant within ten (10) days after the Exercise Date,
and such Warrant Shares shall be deemed issued and the Investor deemed the Investor of record of such Warrant Shares, for all purposes
as of the opening of business on the Exercise Date, notwithstanding any delay in the actual issuance.


 


(b)       Notwithstanding anything herein to
the contrary, as a condition precedent to the exercise of this Warrant and at any time thereafter as may be reasonably requested
by the Company, the Investor agrees to execute and to become a party to, such stock restriction agreements, shareholders’
agreements, voting trust agreements, voting agreements, right of first refusal agreements, co-sale agreements, lock-up agreements,
and other agreements regarding the Common Stock of the Company in such form(s) as the Company may determine from time to time in
its sole discretion.


 


(c)       Notwithstanding anything herein to
the contrary, the Company shall not be obligated to issue any Warrant Shares which would result in the issuance of shares of Common
Stock to the Investor representing more than the applicable percentage under the rules of the NYSE Amex that would require stockholder
approval of the issuance thereof.1 In
the event that Investor has delivered a written subscription to the Company to purchase Warrant Shares in an amount that would
require stockholder approval (after taking into account all shares of Common Stock acquired by the Investor pursuant to this Warrant
and the MGT Option Warrant), the Company shall as soon as practicable after receipt thereof, but in no event later than sixty (60)
days thereafter, hold a meeting of its stockholders for the approval of the issuance of such Warrant Shares. In connection with
such meeting, the Company shall provide each stockholder with a proxy statement and shall use commercially reasonable efforts to
solicit its stockholders’ approval of the issuance of such Warrant Shares and to cause its board of directors to recommend
to the stockholders that they approve such proposal.


 


9.       Transfer. This Warrant is not
transferable.


 


10.       Replacement of Warrant. At the
request of the Investor and on production of evidence reasonably satisfactory to the Company of the loss, theft, destruction or
mutilation of this Warrant and (in the case of loss, theft or destruction) if required by the Company, upon reasonably satisfactory
indemnification, the Company, at Investor’s expense, will issue in lieu thereof a new Warrant of like tenor.


 


 


 


 












		1	The number of shares outstanding as of May 9, 2012 was
2,105,187, and as such, the Company shall be required to obtain shareholder approval prior to the Investor acquiring more than
421,016 shares of Common Stock pursuant to this Warrant and the MGT Warrant.








 






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11.       Governing Law. This Agreement
shall be governed by, and construed and interpreted in accordance with the laws of the State of New York, without regard to such
State’s principles of conflict of laws, except to the extent that the corporation laws of the State of Delaware apply. The
parties irrevocably and unconditionally agree that the exclusive place of jurisdiction for any action, suit or proceeding (“Actions”)
relating to this Agreement shall be in the courts of the United States of America sitting in the Borough of Manhattan in the City
of New York or, if such courts shall not have jurisdiction over the subject matter thereof, in the courts of the State of New York
sitting therein, and each such party hereby irrevocably and unconditionally agrees to submit to the jurisdiction of such courts
for purposes of any such Actions. Each party irrevocably and unconditionally waives any objection it may have to the venue of any
Action brought in such courts or to the convenience of the forum. Final judgment in any such Action shall be conclusive and may
be enforced in other jurisdictions by suit on the judgment, a certified or true copy of which shall be conclusive evidence of the
fact and the amount of any indebtedness or liability of any party therein described.


 


12.       WAIVER OF JURY TRIAL. EACH PARTY
HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.


 


13.       Notice.  All notices
and other communications provided for herein shall be in writing and shall be deemed to have been duly given if delivered personally,
sent by registered or certified mail, return receipt requested, postage prepaid, sent via overnight delivery service or sent via
facsimile, and shall be effective (1) when personally delivered, (2) on the day following delivery to an overnight courier service
if sent for delivery within the United States (or on the second business day following delivery to such courier service if sent
for delivery outside the United States), (3) on the business day following receipt of transmission if sent via facsimile, or (4)
on the fifth business day after the date of mailing if sent by registered or certified mail, in each case to the following addresses:


 


		(a)	If to the Company:



 


MGT Capital Investments, Inc.


500 Mamaroneck Avenue, Suite 204


Harrison, NY 10528


Attn: Robert B. Ladd


 


With a copy to:


 


Dickstein Shapiro LLP


1633 Broadway


New York, NY 10019


Attn: Malcolm I. Ross


 


		(b)	If to the Investor, to the address set forth in the books and records of the Company.



 






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14.       Modification and Waiver. This
Warrant and any provision hereof may only be amended, waived or modified upon written consent of the Company and the Investor.


 


15.       Counterparts. This Warrant may
be executed in any number of counterparts (including by facsimile or PDF transmission), each of which when so executed and delivered
shall be deemed to be an original and all of which together shall be deemed to be one and the same agreement.


 


16.       Binding Effect. The provisions
of this Warrant shall be binding upon and accrue to the benefit of the parties hereto and their respective heirs, legal representatives,
successors and assigns.


 


17.       Severability. Wherever possible,
each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any
provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant.


 


18.       Headings. The headings used
in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.


 


[Remainder of Page Intentionally Blank]


 






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IN WITNESS WHEREOF, the Company has
caused this Warrant to be signed by its duly authorized officers on its behalf, in its corporate name, as of the  9th day of
May, 2012.


 


 


	 	MGT CAPITAL INVESTMENTS, INC.
	 	 	 	 
	 	 	 	 
	 	By:	/s/ Robert B. Ladd	 
	 	 	Name: Robert B. Ladd	 
	 	 	Title: President and CEO	 


 


 


 



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Exhibit
A


 


IRREVOCABLE SUBSCRIPTION


 


		To:	MGT CAPITAL INVESTMENTS, INC.



 


The undersigned hereby elects to exercise
its right under the attached Warrant by purchasing _________ shares of the Common Stock with an exercise price equal to $4.00 per
share, and hereby irrevocably subscribes to such issue. The certificates for such shares shall be issued in the name of:


 


______________________________


(Name)


 


______________________________


(Address)


 


______________________________


(Taxpayer Number)


 


and delivered to:


 


______________________________


(Name)


 


______________________________


(Address)


 


The exercise price of $__________ will be
provided to the Company by _____________.


 


Date: ______________________________


 


Signed: ______________________________


(Name of Investor, Please Print)


 


______________________________


(Address)


 


______________________________


(Signature)


 



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