Document:

ex10_2.htm

Exhibit 10.2

 

WARRANT TO PURCHASE COMMON STOCK

 

OF VIRTUAL PIGGY, INC.

 

 

 

 WARRANT NO.: 201_- [_________]

 

 

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE.  THE SECURITIES REPRESENTED HEREBY HAVE BEEN TAKEN BY THE REGISTERED OWNER FOR INVESTMENT, AND WITHOUT A VIEW TO RESALE OR DISTRIBUTION THEREOF, AND MAY NOT BE SOLD, TRANSFERRED OR DISPOSED OF WITHOUT AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER THAT SUCH TRANSFER OR DISPOSITION DOES NOT VIOLATE THE SECURITIES ACT OF 1933, AS AMENDED, THE RULES AND REGULATIONS THEREUNDER OR OTHER APPLICABLE SECURITIES LAWS.

 

 

This WARRANT (“Warrant”) is to verify that, FOR VALUE RECEIVED, [_________________] (“Holder”) is entitled to purchase, subject to the terms and conditions hereof, from Virtual Piggy, Inc. a Delaware corporation (the “Company”), [_____________] shares of common stock, $0.0001 par value per share, of the Company (the “Common Stock”), at any time during the period commencing at 9:00 a.m., Eastern Time on the date hereof (the “Commencement Date”) and ending at 5:00 p.m. Eastern Time on _____[__], 201[_] (the “Termination Date”), at an exercise price (the “Exercise Price”) of $1.00 per share of Common Stock.  The number of shares of Common Stock purchasable upon exercise of this Warrant and the Exercise Price per share shall be subject to adjustment from time to time upon the occurrence of certain events as set forth below.

 

The shares of Common Stock or any other shares or other units of stock or other securities or property, or any combination thereof, then receivable upon exercise of this Warrant, as adjusted from time to time, are sometimes referred to hereinafter as “Exercise Shares.”  The exercise price per share as from time to time in effect is referred to hereinafter as the “Exercise Price.”

 

  

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1.           Exercise of Warrant; Issuance of Exercise Shares.

 

 

(a)           Exercise of Warrant.  Subject to the terms hereof, the purchase rights represented by this Warrant are exercisable by the Holder in whole or in part, at any time, or from time to time, by the surrender of this Warrant and the Notice of Exercise annexed hereto duly completed and executed on behalf of the Holder, at the office of the Company (or such other office or agency of the Company as it may designate by notice in writing to the Holder at the address of the Holder appearing on the books of the Company) accompanied by payment of the Exercise Price in full in cash or by bank or certified check for the Exercise Shares with respect to which this Warrant is exercised and a completed and duly executed Notice of Exercise form attached hereto as Appendix A.

 

 

In the event that this Warrant shall be duly exercised in part prior to the Termination Date, the Company shall issue a new Warrant or Warrants of like tenor evidencing the rights of the Holder thereof to purchase the balance of the Exercise Shares purchasable under the Warrant so surrendered that shall not have been purchased.

 

(b)           Issuance of Exercise Shares: Delivery of Warrant Certificate.  The Company shall, within three (3) business days of the exercise of this Warrant (“Warrant Share Delivery Date”), issue in the name of and cause to be delivered to the Holder one or more certificates representing the Exercise Shares to which the Holder shall be entitled upon such exercise under the terms hereof.  Such certificate or certificates shall be deemed to have been issued and the Holder shall be deemed to have become the record holder of the Exercise Shares as of the date of the due exercise of this Warrant.  In addition to any other rights available to the Holder, if the Company fails to transmit to the Holder a certificate or the certificates representing the Exercise Shares or to credit the Holder’s balance account at DTC for such number of Exercise Shares pursuant to an exercise 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 Exercise 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, if any) for the shares of Common Stock so purchased (the “Buy-In Amount”) exceeds (y) the amount obtained by multiplying (1) the number of Exercise 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 (i) reinstate the portion of the Warrant and equivalent number of Exercise Shares for which such exercise was not honored and refund the exercise paid therefor or (ii) 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.  For example, if the Holder’s Buy-In Amount is $11,000 to cover a Buy-In with respect to an attempted exercise of shares of Common Stock and if the aggregate sales price of the shares giving rise to such Buy-In obligation was $10,000, under clause (A) of the immediately preceding sentence the Company shall be required to pay the Holder $1,000.  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.  Nothing herein 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 certificates representing shares of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.

 

  

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(c)           Exercise Shares Fully Paid and Non-assessable.  The Company agrees and covenants that all Exercise Shares issuable upon the due exercise of the Warrant represented by this Warrant certificate (“Warrant Certificate”) will, upon issuance and payment therefor in accordance with the terms hereof, be duly authorized, validly issued, fully paid and non-assessable and free and clear of all taxes (other than taxes which, pursuant to Section 2 hereof, the Company shall not be obligated to pay) or liens, charges, and security interests created by the Company with respect to the issuance thereof.

 

(d)           Reservation of Exercise Shares.  The Company covenants that during the term that this 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 the Exercise Shares upon the exercise of this Warrant.

 

(e)           Fractional Shares.  The Company shall not be required to issue fractional shares of capital stock upon the exercise of this Warrant or to deliver Warrant Certificates that evidence fractional shares of capital stock.  In the event that any fraction of an Exercise Share would, except for the provisions of this subsection (e), be issuable upon the exercise of this Warrant, the Company shall pay to the Holder exercising the Warrant an amount in cash equal to such fraction multiplied by the Current Market Value of the Exercise Share on the last business day prior to the date on which this Warrant is exercised.  For purposes of this Warrant, the “Current Market Value” for any day shall be determined as follows:

 

(i)           if the Exercise Shares are traded in the over-the-counter market and not on any national securities exchange, the average of the mean between the last bid and asked prices per share, as reported by Bloomberg, L.P., or an equivalent generally accepted reporting service, or if not so reported, the average of the closing bid and asked prices for an Exercise Share as furnished to the Company by any member of the Financial Industry Regulatory Authority, selected by the Company for that purpose; or

 

(ii)          if the Exercise Shares are listed or traded on a national securities exchange, the closing price on the principal national securities exchange on which they are so listed or traded, on the last business day prior to the date of the exercise of this Warrant.  The closing price referred to in this clause (ii) shall be the last reported sales price or, in case no such reported sale takes place on such day, the average of the reported closing bid and asked prices, in either case on the national securities exchange on which the Exercise Shares are then listed; or

 

  

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(iii)         if the Exercise Shares are not traded in the over-the-counter market or on any national securities exchange or no such closing price or closing bid and asked prices are available, as determined in any reasonable manner as may be prescribed by the Board of Directors of the Company.

 

2.           Payment of Taxes.

 

 

(a)           Stamp Taxes.  The Company will pay all documentary stamp taxes, if any, attributable to the initial issuance of Exercise Shares upon the exercise of this Warrant; provided, however, that the Company shall not be required to pay any tax or taxes which may be payable in respect of any transfer involved in the issue of any Exercise Shares in a name other than that of the Holder of a Warrant Certificate surrendered upon the exercise of a Warrant, and the Company shall not be required to issue or deliver such certificates unless or until the person or persons requesting the issuance thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid.  Except as specifically provided in this Section 2, Holder shall be responsible for the payment of all other taxes incurred in connection with the receipt, transfer or sale of the Warrant or the Exercise Shares.

 

 

(b)           Withholding.  The Holder shall pay to the Company, or make arrangements satisfactory to the Company regarding payment of, any federal, state, local and/or payroll taxes of any kind required by law to be withheld with respect to the grant of this Warrant or the issuance of the Exercise Shares.  The Company may, to the extent permitted by law, deduct any such taxes from any payment of any kind otherwise due to the Holder whether or not pursuant to this Warrant.  The Holder may elect, with the consent of the Company, to have such tax withholding obligation satisfied, in whole or in part, by: (i) authorizing the Company to withhold from the Exercise Shares a number of shares of Common Stock having an aggregate Current Market Value that would satisfy the minimum withholding amount due, or (ii) delivering to the Company a number of shares of Common Stock of which the Holder is the record and beneficial owner and that have been held by the Holder for at least six (6) months with an aggregate Current Market Value that would satisfy the minimum withholding amount due.  The Company may require that any fractional share amount be settled in cash.  For the purposes of this Section 2, Current Market Value shall be determined as of the date on which the amount of tax to be withheld is determined.

 

3.           Mutilated or Missing Warrant Certificates.  In case any Warrant shall be mutilated, lost, stolen or destroyed, the Company may in its discretion issue, in exchange and substitution for and upon cancellation of the mutilated Warrant, or in lieu of and in substitution for the Warrant lost, stolen or destroyed, a new Warrant or Warrants of like tenor and in the same aggregate denomination, but only (i) in the case of loss, theft or destruction, upon receipt of evidence satisfactory to the Company of such loss, theft or destruction of such Warrant and indemnity or bond, if requested, also satisfactory to them and (ii) in the case of mutilation, upon surrender of the mutilated Warrant.  Applicants for such substitute Warrants shall also comply with such other reasonable regulations and pay such other reasonable charges as the Company or its counsel may prescribe.

 

  

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4.           Rights of Holder.  The Holder shall not, by virtue of anything contained in this Warrant or otherwise, be entitled to any right whatsoever, either in law or equity, of a stockholder of the Company, including without limitation, the right to receive dividends or to vote or to consent or to receive notice as a shareholder in respect of the meetings of shareholders or the election of directors of the Company or any other matter.

 

 

5.           Registration of Transfers and Exchanges.  This Warrant may be transferred or exchanged, at the option of the Holder thereof and without change, when surrendered to the Company at its principal office, or at the office of its transfer agent, if any, for another Warrant or other Warrants of like tenor and representing in the aggregate the right to purchase from the Company a like number and kind of Exercise Shares as the Warrant surrendered for exchange, and the Warrant so surrendered shall be canceled by the Company or transfer agent, as the case may be.

 

 

6.           Adjustment of Exercise Shares and Exercise Price.  The Exercise Price and the number and kind of Exercise Shares purchasable upon the exercise of this Warrant shall be subject to adjustment from time to time upon the happening of certain events as hereinafter provided. The Exercise Price in effect at any time and the number and kind of securities purchasable upon exercise of each Warrant shall be subject to adjustment as follows:

 

 

(a)           In case of any consolidation or merger of the Company with another corporation (other than a merger with another corporation in which the Company is the surviving corporation and which does not result in any reclassification or change -- other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination -- of outstanding Common Stock issuable upon such exercise), the rights of the Holder of this Warrant shall be adjusted in the manner described below:

 

(i)           In the event that the Company is the surviving corporation or is merged into a wholly owned subsidiary for the purpose of incorporating the Company in a different jurisdiction, this Warrant shall, without payment of additional consideration therefor, be deemed modified so as to provide that the Holder of this Warrant, upon the exercise thereof, shall procure, in lieu of each share of Common Stock theretofore issuable upon such exercise, the kind and amount of shares of stock, other securities, money and property receivable upon such reclassification, change, consolidation or merger by the holder of each share of Common Stock, had exercise of this Warrant occurred immediately prior to such reclassification, change, consolidation or merger. This Warrant (as adjusted) shall be deemed to provide for further adjustments that shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 6.  The provisions of this clause (i) shall similarly apply to successive reclassifications, changes, consolidations and mergers.

 

  

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(ii)          In the event that the Company is not the surviving corporation (except in the case of a merger of the Company into a wholly owned subsidiary for the purpose of incorporating the Company in a different jurisdiction), Holder shall be given at least fifteen (15) days prior written notice of such transaction and shall be permitted to exercise this Warrant, to the extent it is exercisable as of the date of such notice, during this fifteen (15) day period.  Upon expiration of such fifteen (15) day period, this Warrant and all of Holder’s rights hereunder shall terminate.

 

(b)           If the Company, at any time while this Warrant, or any portion thereof, remains outstanding and unexpired, by reclassification of securities or otherwise, shall change any of the securities as to which purchase rights under this Warrant exist into the same or a different number of securities of any other class or classes, this Warrant shall thereafter represent the right to acquire such number and kind of securities as would have been issuable as the result of such change with respect to the securities that were subject to the purchase rights under this Warrant immediately prior to such reclassification or other change and the Exercise Price therefor shall be appropriately adjusted, all subject to further adjustment as provided in this Section 6.

 

(c)           In case the Company shall (i) pay a dividend or make a distribution on its shares of Common Stock in shares of Common Stock, (ii) subdivide or reclassify its outstanding Common Stock into a greater number of shares, or (iii) combine or reclassify its outstanding Common Stock into a smaller number of shares, the Exercise Price in effect at the time of the record date for such dividend or distribution or of the effective date of such subdivision, combination or reclassification, shall be proportionally adjusted so that the Holder of this Warrant exercised after such date shall be entitled to receive the aggregate number and kind of shares that, if this Warrant had been exercised by such Holder immediately prior to such date, he would have owned upon such exercise and been entitled to receive upon such dividend, subdivision, combination or reclassification.  For example, if the Company declares a 2 for 1 stock dividend or stock split and the Exercise Price immediately prior to such event was $0.40 per share, the adjusted Exercise Price immediately after such event would be $0.20 per share. Such adjustment shall be made successively whenever any event listed above shall occur.  Whenever the Exercise Price payable upon exercise of each Warrant is adjusted pursuant to this subsection (c), the number of Exercise Shares purchasable upon exercise of this Warrant shall simultaneously be adjusted by multiplying the number of Exercise Shares initially issuable upon exercise of this Warrant by the Exercise Price in effect on the date hereof and dividing the product so obtained by the Exercise Price, as adjusted.

 

  

B-6

  

 

(d)           In the event that at any time, as a result of an adjustment made pursuant to subsection (a), (b) or (c) above, the Holder of this Warrant thereafter shall become entitled to receive any Exercise Shares of the Company, other than Common Stock, thereafter the number of such other shares so receivable upon exercise of this Warrant shall 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 the Common Stock contained in subsections (a), (b) or (c) above.

 

(e)           Irrespective of any adjustments in the Exercise Price or the number or kind of Exercise Shares purchasable upon exercise of this Warrant, Warrants theretofore or thereafter issued may continue to express the same price and number and kind of shares as are stated in the similar Warrants initially issuable pursuant to this Warrant.

 

(f)           Whenever the Exercise Price shall be adjusted as required by the provisions of the foregoing Section 6, the Company shall forthwith file in the custody of its Secretary or an Assistant Secretary at its principal office and with its stock transfer agent, if any, an officer’s certificate showing the adjusted Exercise Price determined as herein provided, setting forth in reasonable detail the facts requiring such adjustment, including a statement of the number of additional shares of Common Stock, if any, and such other facts as shall be necessary to show the reason for and the manner of computing such adjustment.  Each such officer’s certificate shall be made available at all reasonable times for inspection by the holder and the Company shall, forthwith after each such adjustment, mail a copy of such certificate to the Holder.

 

(g)           All calculations under this Section 6 shall be made to the nearest cent or to the nearest one one-hundredth (1/100th) of a share, as the case may be.

 

7.           Investment Intent, Exercise Restrictions and Transfer Restrictions.

 

(a)           The Warrant and the Exercise Shares may not be offered for sale or sold, or otherwise transferred or sold in any transaction which would constitute a sale thereof within the meaning of the Securities Act of 1933, as amended (the “1933 Act”), unless (i) such security has been registered for sale under the 1933 Act and registered or qualified under applicable state securities laws relating to the offer and sale of securities, or (ii) exemptions from the registration requirements of the 1933 Act and the registration or qualification requirements of all such state securities laws are available and the Company shall have received an opinion of counsel satisfactory to the Company that the proposed sale or other disposition of such securities may be effected without registration under the 1933 Act and would not result in any violation of any applicable state securities laws relating to the registration or qualification of securities for sale, such counsel and such opinion to be satisfactory to the Company.

 

The Holder agrees to indemnify and hold harmless the Company against any loss, damage, claim or liability arising from the disposition of this Warrant or any Exercise Share held by such holder or any interest therein in violation of the provisions of Section 5 or 7 hereof, respectively.

 

(b)           The certificates evidencing any Exercise Shares issued upon the exercise of this Warrant shall have endorsed thereon (except to the extent that the restrictions described in any such legend are no longer applicable) substantially the following legend, appropriate notations thereof will be made in the Company's stock transfer books, and stop transfer instructions reflecting these restrictions on transfer will be placed with the transfer agent of the Exercise Shares.

 

  

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THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE.  THE SECURITIES REPRESENTED HEREBY HAVE BEEN TAKEN BY THE REGISTERED OWNER FOR INVESTMENT, AND WITHOUT A VIEW TO RESALE OR DISTRIBUTION THEREOF, AND MAY NOT BE SOLD, TRANSFERRED OR DISPOSED OF WITHOUT AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER THAT SUCH TRANSFER OR DISPOSITION DOES NOT VIOLATE THE SECURITIES ACT OF 1933, AS AMENDED, THE RULES AND REGULATIONS THEREUNDER OR OTHER APPLICABLE SECURITIES LAWS.

 

 

8.           Intentionally Omitted.

 

9.           Registration Rights.  The Holder shall be entitled to the rights and subject to the obligations set forth in Section 6 of that certain Securities Purchase Agreement by and between the Company, the Holder and other holders.

 

10.          Notices.  All notices hereunder shall be sufficiently given for all purposes hereunder if in writing and delivered personally, sent by documented overnight delivery service or, to the extent receipt is confirmed, telecopy, telefax or other electronic transmission service to the appropriate address or number as set forth below:

 

 

If to the Company:

 

 

Virtual Piggy, Inc.

 

1221 Hermosa Avenue, Suite 210

 

Hermosa Beach, CA 90254

 

Fax: (310) 634-1246

 

Attention: Chief Financial Officer

 

  

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with a copy to:

 

Wiggin and Dana LLP

 

Two Stamford Plaza

 

281 Tresser Boulevard

 

Stamford, CT 06901

 

Fax: (203) 363-7676

 

Attention: Michael Grundei

 

 

and to the Holder at the address of the Holder appearing on the books of the Company or the Company's transfer agent, if any.

 

 

Either of the Company or the Holder may from time to time change the address to which notices to it are to be mailed hereunder by notice in accordance with the provisions of this Section 10.

 

11.           Supplements and Amendments.  The Company may from time to time supplement or amend this Warrant without the approval of the Holder of this Warrant in order to cure any ambiguity or to correct or supplement any provision contained herein which may be defective or inconsistent with any other provision, or to make any other provisions in regard to matters or questions herein arising hereunder which the Company may deem necessary or desirable and which shall not materially adversely affect the interests of the Holder.  Except as set forth in the immediately preceding sentence, this Warrant may not be amended, modified or supplemented except by an instrument or instruments in writing signed by the party against whom enforcement of any such amendment, modification or supplement is sought.

 

 

12.           Successors.  This Warrant shall inure to the benefit of and be binding on the respective successors, assigns and legal representatives of the Holder and the Company.

 

  

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13.           Severability.  If for any reason any provision, paragraph or terms of this Warrant is held to be invalid or unenforceable, all other valid provisions herein shall remain in full force and effect and all terms, provisions and paragraphs of this Warrant shall be deemed to be severable.

 

 

14.           Governing Law.  This Warrant shall be governed by and construed in accordance with the laws of the State of New York, without regard to the laws that might otherwise govern under applicable principles of conflicts of laws thereof, except to the extent that the General Corporation Law of the State of Delaware shall apply to the internal corporate governance of the Company.

 

 

15.           Arbitration.  The parties agree that any dispute, claim or controversy directly or indirectly relating to or arising out of this Warrant, the termination or validity hereof, any alleged breach of this Agreement or the engagement contemplated hereby (any of the foregoing, a “Claim”) shall be submitted to the Judicial Arbitration and Mediation Services, Inc. (JAMS), or its successor, in New York, for final and binding arbitration in front of a panel of three arbitrators with JAMS in New York, New York under the JAMS Comprehensive Arbitration Rules and Procedures (with each of the Holder and the Company choosing one arbitrator, and the chosen arbitrators choosing the third arbitrator).  The arbitrators shall, in their award, allocate all of the costs of the arbitration, including the fees of the arbitrators and the reasonable attorneys’ fees of the prevailing party, against the party who did not prevail.  The award in the arbitration shall be final and binding.  The arbitration shall be governed by the Federal Arbitration Act, 9 U.S.C. Sec.1-16, and the judgment upon the award rendered by the arbitrators may be entered by any court having jurisdiction thereof.  The Company and the Holder agree and consent to personal jurisdiction, service of process and venue in any federal or state court within the State and County of New York in connection with any action brought to enforce an award in arbitration.

 

 

16.           Headings.  Section and subsection headings used herein are included herein for convenience of reference only and shall not affect the construction of this Warrant nor constitute a part of this Warrant for any other purpose.

 

 

[Signature page follows]

 

  

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IN WITNESS WHEREOF, the Company has caused these presents to be duly executed as of the ___ day of ______________, 201_.

 

 

 

	 	
VIRTUAL PIGGY, INC.

	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	By:	 	 
	 	 	Name:	 
	 	 	 	 
	 	 	Title:	 

 

 

 

  

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APPENDIX A

 

 

NOTICE OF EXERCISE

 

 

	
To:

	
Virtual Piggy, Inc.

	 	 
	  	
1221 Hermosa Avenue, Suite 210

	 	 
	  	
Hermosa Beach, CA 90254

	  	  
	 	 
	 	 
	  	
Attention: Chief Financial Officer

 

 

 (1)           The undersigned hereby elects to purchase ____________ shares of Common Stock of Virtual Piggy, Inc., a Delaware corporation, pursuant to the terms of the attached Warrant, and tenders herewith payment of the Exercise Price for such shares in full in accordance with the terms of the Warrant.

 

(2)            In exercising this Warrant, the undersigned hereby confirms and acknowledges that the shares of Common Stock to be issued upon conversion hereof are being acquired solely for the account of the undersigned, not as a nominee for any other party, and for investment purposes only (unless such shares are subject to resale pursuant to an effective prospectus), and that the undersigned will not offer, sell or otherwise dispose of any such shares of Common Stock except under circumstances that will not result in a violation of the Securities Act of 1933, as amended, or any state securities laws.

 

(3)           Terms not otherwise defined in this Notice of Exercise shall have the meanings ascribed to such terms in the attached Warrant

 

(4)           Please issue a certificate or certificates representing said shares of Common Stock in the name of the undersigned.

 

 

 

 

	 	 	 	 	HOLDER	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	
 

	 	 	 	 	 
	
 

	 	 	 	 	 
	
(Date)

	 	 	 	(Signature)QCOM 12.29.13 EX 10.120

Exhibit 10.120
Form of the <Year> ACIP Award Agreement for 162(m) Covered Officers
<YEAR> ANNUAL CASH INCENTIVE PLAN
Performance Unit Agreement
This Award Agreement between Qualcomm Incorporated (the “Company”) and <Insert Name> (the “Executive”) evidences the grant of a Performance Unit (this “Award”) under the Qualcomm Incorporated 2006 Long-Term Incentive Plan (the “Plan”), representing a right to receive a cash payment equal to the amount determined by the Compensation Committee (the “Committee”) based on performance.
	
		
	Definitions
	Capitalized terms used in this Award Agreement have the meaning specified under the Plan, except as otherwise specified herein.

	Grant Date
	< insert month and day >, <Year>.

	Performance Period
	The Performance Period is the Company’s <Year> fiscal year.

	Performance Goals; Amount Payable Under this Award
	The amount payable under this Award, if any, will be based on the extent to which the Company meets or exceeds the Performance Goals established by the Committee, which are as described in Attachment A, subject to the Committee’s exercise of discretion under section 9.5(b) of the Plan.
To be eligible to receive payment with respect to this Award, your Service must be continuous from the Grant Date through the Payment Date specified below.

	Payment Date
	This Award shall be paid in cash no later than 30 calendar days after the Committee’s written certification of the attainment of the Performance Goals, determination of the amount, if any, to be paid and the Company’s fiscal <Year> annual earnings release.

	Repayment Policy
	By executing this Award Agreement, you acknowledge that any payment made with respect to this Award is subject to (a) the current Qualcomm Incorporated Cash Incentive Compensation Repayment Policy, a copy of which is attached to this Award Agreement as Attachment B and incorporated herein by reference; (b) any applicable listing standards of a national securities exchange adopted in accordance with Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (regarding recovery of erroneously awarded compensation) and any implementing rules and regulations of the U.S. Securities and Exchange Commission adopted thereunder; (c) similar rules under the laws of any other jurisdiction; and (d) any policies hereinafter adopted by the Company to implement such requirements, all to the extent determined by the Company in its discretion to be applicable to you (collectively, the “Repayment Policy”).  You hereby agree to be bound by the Repayment Policy.  

	Terms of the Plan
	This Award is subject to the terms and conditions of the Plan, which are incorporated herein by reference.  In the event of any conflict between this Award Agreement and the terms of the Plan, then the terms of the Plan control.

The Award Agreement is effective as of the latest date specified below.
QUALCOMM INCORPORATED    
Name: _________________________     
Title: __________________________    
Date: __________________________    
I hereby acknowledge that I have read, understand, and accept the terms of this Award Agreement, the Plan, and the Repayment Policy.

EXECUTIVE    
Name: _________________________     
Title: __________________________
Date: __________________________    

		
	Attachments:
	Attachment A - Performance Goals

Attachment B - Cash Incentive Compensation Repayment Policy

ATTACHMENT A
FISCAL YEAR <YEAR> PERFORMANCE GOALS AND PAYMENT FORMULA
<Executive’s Name>
	
				
	Base Salary
	Bonus Target as a Percent of Base Salary
	Target Award Amount
	Maximum Award Amount (200% of Target Award Amount)

	 
	 
	 
	 

I.  Formula to Calculate Maximum Award Amount
Subject to the Committee’s exercise of discretion under section 9.5(b) of the Plan, you will be eligible to earn the Maximum Award Amount specified above if the Company’s fiscal <Year> Adjusted GAAP operating income is equal to or greater than $_____ billion (__% of the Company’s fiscal <prior year> GAAP operating income of $_____ billion).  For this purpose, “<Year> Adjusted GAAP operating income” is determined in accordance with U.S. generally accepted accounting principles or accounting standards as may be required by the Financial Accounting Standards Board as of the Grant Date (“GAAP”), but determined excluding (1) results from operations of the Qualcomm Strategic Initiative (“QSI”) segment; (2) all share-based compensation other than amounts related to share-based awards granted under a bonus program that may result in the issuance of unrestricted shares of the Company’s common stock; (3) the following items resulting from acquisitions:  acquired in-process research and development expenses, recognition of the step-up of inventories to fair value and amortization of certain intangible assets; and (4) losses or expenses attributable to discontinued operations, plant shut-downs, or other restructuring.  If the Company’s fiscal <Year> Adjusted GAAP operating income is less than $_____ billion, your Maximum Award Amount specified above shall be reduced to an amount equal to (a) ___% of <Year> Adjusted GAAP operating income multiplied by (b) a fraction, the numerator of which is the Maximum Award Amount stated above, and the denominator of which is $_____________.
Subject to the Maximum Award Amount as determined in this Section I, the actual amount of the payment you receive under this Award will be determined by the Committee during the fourth quarter of the Performance Period based on the formula specified in Section II below for measuring the Company’s financial performance and the Committee’s exercise of discretion as provided in Section 9.5(b) of the Plan. 
II.  Formula to Calculate Amount Payable
No amount will be payable unless the Company has at least $_____ billion in Non-GAAP operating income (as defined below) for fiscal <Year>.  If Non-GAAP operating income equals or exceeds that amount, subject to the Committee’s exercise of discretion under section 9.5(b) of the Plan, the conditions of this Award and the Maximum Award Amount determined above, the amount payable under this Award, if any, shall be calculated during the fourth quarter of fiscal <Year> as follows:
		
	1.
	The Company fiscal <Year> financial Performance Measures and Performance Targets for purposes of determining the amount payable under this Award are as follows:

Performance Measures    Performance Targets
		
	•
	Non-GAAP revenues:     $_____ billion

		
	•
	Non-GAAP operating income:    $_____ billion

“Non-GAAP revenues” and “Non-GAAP operating income” are as of the Company’s September outlook (or most recent available) for fiscal <Year>, subject to adjustments pursuant to the policy established by the Committee.  The Company applies a relative weighting of 40% to Non-GAAP revenues and 60% to Non-GAAP operating income.
		
	2.
	The weighted financial performance ratio for Non-GAAP revenues will be the result of 0.40 multiplied by a fraction, the numerator of which is the September outlook (or most recent available) Non-GAAP revenues for fiscal <Year>, and the denominator of which is the fiscal <Year> Non-GAAP revenues objective stated above.

		
	3.
	The weighted financial performance ratio for Non-GAAP operating income will be the result of 0.60 multiplied by a fraction, the numerator of which is the September outlook (or most recent available)  Non-GAAP operating income for fiscal <Year>, and the denominator of which is the fiscal <Year> Non-GAAP operating income objective stated above.

		
	4.
	

		
	1.
	The resulting weighted financial performance ratios for Non-GAAP revenues and Non-GAAP operating income will then be summed (the “Weighted Financial Performance Ratio”) and the “Incentive Multiple” will be calculated according to the schedule set forth below:

	
					
	Weighted
Financial Performance Ratio
	 
	Incentive
Multiple
	 
	Rate of Increase to the Incentive Multiple

	70%
	 
	0.0000
	 
	The Incentive Multiple is zero (0.0) if the Weighted Financial Performance Ratio is less than 80%.

	75%
	 
	0.0000
	 

	80%
	 
	0.0000
	 
	The Incentive Multiple increases 5.0 percentage points for each 1.0 percent improvement in the Weighted Financial Performance Ratio from 80% to 100%.

	85%
	 
	0.2500
	 

	90%
	 
	0.5000
	 

	95%
	 
	0.7500
	 

	100%
	 
	1.0000
	 
	The Incentive Multiple increases 4.0 percentage points for each 1.0 percent improvement in the Weighted Financial Performance Ratio from 100% to 125%.

	105%
	 
	1.2000
	 

	110%
	 
	1.4000
	 

	115%
	 
	1.6000
	 

	120%
	 
	1.8000
	 

	125%
	 
	2.0000
	 
	The Incentive Multiple is at the maximum rate of 2.0x if the Weighted Financial Performance Ratio equals or exceeds 125%.

	130%
	 
	2.0000
	 

	135%
	 
	2.0000
	 

	140%
	 
	2.0000
	 

	145%
	 
	2.0000
	 

	150%
	 
	2.0000
	 

		
	2.
	Subject to the limitations of Section I and the exercise of discretion as provided in Section 9.5(b) of the Plan, the amount payable under this Award shall be the result of the Target Award Amount multiplied by the Incentive Multiple determined in step 4 above.

ATTACHMENT B
QUALCOMM INCORPORATED
Cash Incentive Compensation Repayment Policy
To the extent permitted by governing law, the Company will require an executive officer to repay to the Company the amount of any annual cash incentive bonus payment that executive officer receives to the extent that (i) the amount of such payment was based on the achievement of certain financial results that were subsequently the subject of a restatement that occurs within twelve months of such payment, (ii) the executive officer has engaged in theft, dishonesty or intentional falsification of Company documents or records that resulted in the obligation to restate, and (iii) a lower cash incentive bonus payment would have been made to the executive officer based upon the restated financial results.  
Notwithstanding anything in this Policy to the contrary, an accounting judgment made in good faith and supported by reasonable interpretations of generally accepted accounting principles (“GAAP”) at the time made shall not be the basis for the Company to require any repayments under this Policy.
The executive officer’s repayment obligation under this Policy shall be in addition to, and shall in no way limit, any other remedies that the Company may have available to it, and any other actions that the Company may take, with respect to the conduct of the executive officer or in connection with the accounting restatement.
For purposes of this Policy, an “executive officer” shall be any member of the Company’s executive committee and any other officers or employees of the Company as may be designated by the Company from time to time.  
The interpretation and enforcement of this Policy shall be the responsibility of the Compensation Committee of the Board of Directors of the Company.
This Policy shall be effective with respect to cash incentive compensation paid to an executive officer on or after January 1, 2009.

Form of the <Year> ACIP Award Agreement for Non-162(m) Covered Officers
<YEAR> ANNUAL CASH INCENTIVE PLAN
Performance Unit Agreement
This Award Agreement between Qualcomm Incorporated (the “Company”) and <Insert Name> (the “Executive”) evidences the grant of a Performance Unit (this “Award”) under the Qualcomm Incorporated 2006 Long-Term Incentive Plan (the “Plan”), representing a right to receive a cash payment equal to the amount determined by the Compensation Committee (the “Committee”) based on performance.
	
		
	Definitions
	Capitalized terms used in this Award Agreement have the meaning specified under the Plan, except as otherwise specified herein.

	Grant Date
	< insert month and day >, <Year>.

	Performance Period
	The Performance Period is the Company’s <Year> fiscal year.

	Performance Goals; Amount Payable Under this Award
	The amount payable under this Award, if any, will be based on the extent to which the Company meets or exceeds the Performance Goals established by the Committee, which are as described in Attachment A, subject to the Committee’s exercise of discretion under section 9.5(b) of the Plan.
To be eligible to receive payment with respect to this Award, your Service must be continuous from the Grant Date through the Payment Date specified below.

	Payment Date
	This Award shall be paid in cash no later than 30 calendar days after the Committee’s written certification of the attainment of the Performance Goals, determination of the amount, if any, to be paid and the Company’s fiscal <Year> annual earnings release.

	Repayment Policy
	By executing this Award Agreement, you acknowledge that any payment made with respect to this Award is subject to (a) the Qualcomm Incorporated Cash Incentive Compensation Repayment Policy, a copy of which is attached to this Award Agreement and incorporated herein by reference; (b) any applicable listing standards of a national securities exchange adopted in accordance with Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (regarding recovery of erroneously awarded compensation) and any implementing rules and regulations of the U.S. Securities and Exchange Commission adopted thereunder; (c) similar rules under the laws of any other jurisdiction; and (d) any policies adopted by the Company to implement such requirements, all to the extent determined by the Company in its discretion to be applicable to you (collectively, the “Repayment Policy”).  You hereby agree to be bound by the Repayment Policy.

	Terms of the Plan
	This Award is subject to the terms and conditions of the Plan, which are incorporated herein by reference.  In the event of any conflict between this Award Agreement and the terms of the Plan, then the terms of the Plan control.

The Award Agreement is effective as of the latest date specified below.
QUALCOMM INCORPORATED    
Name: _________________________     
Title: __________________________    
Date: __________________________
I hereby acknowledge that I have read, understand, and accept the terms of this Award Agreement, the Plan, and the Repayment Policy.

EXECUTIVE    
Name: _________________________     
Title: __________________________
Date: __________________________

		
	Attachments:
	Attachment A - Performance Goals

Attachment B - Cash Incentive Compensation Repayment Policy

ATTACHMENT A
FISCAL YEAR <YEAR> PERFORMANCE GOALS AND PAYMENT FORMULA
<Executive’s Name>
	
				
	Base Salary
	Bonus Target as a Percent of Base Salary
	Target Award Amount
	Maximum Award Amount (200% of Target Award Amount)

	 
	 
	 
	 

Formula to Calculate Amount Payable
No amount will be payable unless the Company has at least $_____ billion in Non-GAAP operating income (as defined below) for fiscal <Year>.  If Non-GAAP operating income equals or exceeds that amount, subject to the Committee’s exercise of discretion under section 9.5(b) of the Plan, the conditions of this Award and the Maximum Award Amount determined above, the amount payable under this Award, if any, shall be calculated after the completion of fiscal <Year> as follows:
		
	1.
	The Company fiscal <Year> financial Performance Measures and Performance Targets for purposes of determining the amount payable under this Award are as follows:

Performance Measures    Performance Targets
		
	•
	Non-GAAP revenues:     $_____ billion

		
	•
	Non-GAAP operating income:    $_____ billion

“Non-GAAP revenues” and “Non-GAAP operating income” are as of the Company’s September outlook (or most recent available) for fiscal <Year>, subject to adjustments pursuant to the policy established by the Committee.  The Company applies a relative weighting of 40% to Non-GAAP revenues and 60% to Non-GAAP operating income.
		
	2.
	The weighted financial performance ratio for Non-GAAP revenues will be the result of 0.40 multiplied by a fraction, the numerator of which is the September outlook (or most recent available) Non-GAAP revenues for fiscal <Year>, and the denominator of which is the fiscal <Year> Non-GAAP revenues objective stated above.

		
	3.
	The weighted financial performance ratio for Non-GAAP operating income will be the result of 0.60 multiplied by a fraction, the numerator of which is the September outlook (or most recent available) Non-GAAP operating income for fiscal <Year>, and the denominator of which is the fiscal <Year> Non-GAAP operating income objective stated above.

		
	4.
	The resulting weighted financial performance ratios for Non-GAAP revenues and Non-GAAP operating income will then be summed (the “Weighted Financial Performance Ratio”) and the “Incentive Multiple” will be calculated according to the schedule set forth below:

	
					
	Weighted
Financial Performance Ratio
	 
	Incentive
Multiple
	 
	Rate of Increase to the Incentive Multiple

	70%
	 
	0.0000
	 
	The Incentive Multiple is zero (0.0) if the Weighted Financial Performance Ratio is less than 80%.

	75%
	 
	0.0000
	 

	80%
	 
	0.0000
	 
	The Incentive Multiple increases 5.0 percentage points for each 1.0 percent improvement in the Weighted Financial Performance Ratio from 80% to 100%.

	85%
	 
	0.2500
	 

	90%
	 
	0.5000
	 

	95%
	 
	0.7500
	 

	100%
	 
	1.0000
	 
	The Incentive Multiple increases 4.0 percentage points for each1.0 percent improvement in the Weighted Financial Performance Ratio from 100% to 125%.

	105%
	 
	1.2000
	 

	110%
	 
	1.4000
	 

	115%
	 
	1.6000
	 

	120%
	 
	1.8000
	 

	125%
	 
	2.0000
	 
	The Incentive Multiple is at the maximum rate of 2.0x
if the Weighted Financial Performance Ratio equals or exceeds 125%.

	130%
	 
	2.0000
	 

	135%
	 
	2.0000
	 

	140%
	 
	2.0000
	 

	145%
	 
	2.0000
	 

	150%
	 
	2.0000
	 

		
	5.
	The amount payable under this Award shall be the result of the Target Award Amount multiplied by the Incentive Multiple determined in step 4 above.

ATTACHMENT B
QUALCOMM INCORPORATED
Cash Incentive Compensation Repayment Policy
To the extent permitted by governing law, the Company will require an executive officer to repay to the Company the amount of any annual cash incentive bonus payment that executive officer receives to the extent that (i) the amount of such payment was based on the achievement of certain financial results that were subsequently the subject of a restatement that occurs within twelve months of such payment, (ii) the executive officer has engaged in theft, dishonesty or intentional falsification of Company documents or records that resulted in the obligation to restate, and (iii) a lower cash incentive bonus payment would have been made to the executive officer based upon the restated financial results.  
Notwithstanding anything in this Policy to the contrary, an accounting judgment made in good faith and supported by reasonable interpretations of generally accepted accounting principles (“GAAP”) at the time made shall not be the basis for the Company to require any repayments under this Policy.
The executive officer’s repayment obligation under this Policy shall be in addition to, and shall in no way limit, any other remedies that the Company may have available to it, and any other actions that the Company may take, with respect to the conduct of the executive officer or in connection with the accounting restatement.
For purposes of this Policy, an “executive officer” shall be any member of the Company’s executive committee and any other officers or employees of the Company as may be designated by the Company from time to time.  
The interpretation and enforcement of this Policy shall be the responsibility of the Compensation Committee of the Board of Directors of the Company.
This Policy shall be effective with respect to cash incentive compensation paid to an executive officer on or after January 1, 2009.

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