Document:

ex4-1.htm

     

    
      EXHIBIT
4.1

      

      Form of Convertible
Promissory Note

       

      THIS
CONVERTIBLE PROMISSORY NOTE (THIS “NOTE”) AND THE SECURITIES INTO WHICH THIS
NOTE IS CONVERTIBLE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAWS AND THIS NOTE, THE
SECURITIES AND ANY INTEREST THEREIN MAY NOT BE OFFERED, SOLD, TRANSFERRED,
PLEDGED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT OR SUCH LAWS OR AN EXEMPTION FROM REGISTRATION UNDER THE
ACT AND SUCH LAWS, WHICH, IN THE OPINION OF COUNSEL FOR THE LENDER, WHICH
COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO COUNSEL FOR THIS CORPORATION,
IS AVAILABLE.

       

      

      ACCELERIZE
NEW MEDIA, INC.

      CONVERTIBLE
PROMISSORY NOTE

       

      
        	[$________]      	
                 New York, New
      York

                [February 1,
      2009]

              

      

       

      FOR VALUE
RECEIVED, the undersigned, Accelerize New Media, Inc. a Delaware
corporation  (referred to herein as the “Borrower”), with offices at
12121 Wilshire Blvd., Suite 322, Los Angeles, CA 90025, hereby unconditionally
promises to pay to the order of [_____________________]  (the
“Lender”), in lawful money of the United States, at
[__________________________________], or such other address as the Lender may
from time to time designate, the principal sum of [___________ Dollars
($________)] (the “Principal”).  This Note shall mature and become due
and payable in full on [February 15, 2012] (the “Maturity Date”).

       

      1.           Terms of
Repayment.  Principal of and interest on this Note shall be
paid by the Borrower as follows:

       

      (a)           Interest
at the rate of ten percent (12%) per annum from the date hereof through the
Maturity Date shall be payable quarterly on each of June 1, September 1,
December 1 and March 1 (each an “Interest Payment Date”), commencing [June 1,
2009].  Subject to certain limitations detailed within this Note,
interest shall be payable at the option of the Lender in cash or shares common
stock, par value $0.001 of the Borrower (the “Common Stock”), provided, however,
that in the case of interest distributions to retirement based accounts held at
National Financial Services (NFS), interest will be paid only in
cash.

       

      (b)           If
interest is payable in shares of Common Stock, the number of shares of Common
Stock to be issued to the Lender as payment of interest shall be determined by
dividing the interest dollar amount due on the respective Interest Payment Date
by the Closing Price (as defined below) of the Common Stock on the last Trading
Day (as defined below) before the respective Interest Payment Date, and rounding
it to the nearest whole number (no fractional shares shall be
issued).  As used herein, the term "Trading Day" means a day on which
trades are effected on the Over-The-Counter Bulletin Board (“OTCBB”), NASDAQ or
any other stock exchange on which the Common Stock trades.  As used
herein, the term “Closing Price” for each Trading Day shall be: (i) if shares of
Common Stock are listed or admitted for trading on any national securities
exchange, or the NASDAQ Stock Market, Inc., the last sale price of the Common
Stock, or the closing bid price thereof if no such sale occurred, in each case
as officially reported on the principal securities exchange on which such
security is listed, or (ii) if quoted on the OTCBB or any similar system of
automated dissemination of quotations of securities prices then in common use
the closing high bid quotation of such security in the over-the-counter market
as shown by OTCBB or such similar system of automated dissemination of
quotations of securities prices.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      (c)           All
computations of interest shall be made on the basis of a year of 360 days for
the actual number of days (including the first day but excluding the last day)
occurring in the period for which such interest is payable.  Whenever
any payment to be made hereunder shall be stated to be due on a day that is not
a business day, such payment shall be made on the next succeeding business
day.

       

      (d)           Principal
shall be due and payable on the Maturity Date, at which time the Principal shall
be payable at the option of the Lender in cash or shares of Common
Stock.  If then at the Lender’s election the Principal is payable in
shares of Common Stock, the number of shares of Common Stock to be issued to the
Lender shall be determined by dividing the principal amount outstanding on the
Maturity Date by the average Closing Price of the Common Stock on the last five
(5) Trading Days prior to the Maturity Date.

       

      2.           Terms of
Prepayment.

       

      (a)           At
any time on or prior to June 30, 2009, the Borrower may at its sole election
prepay all or any portion of the outstanding Principal and any interest amount
accrued thereon of the Note solely in cash, provided that the Borrower shall
then additionally pay to the Lender in cash a prepayment penalty (the
“Penalty”), which Penalty shall be calculated as the product of (I) sum of one
half of one percent (0.5%, or 50 basis points) for each open full month
remaining on the Note between the prepayment date and the Maturity date, times
(II) the Principal amount then prepaid.

       

      (b)           
At any time on or after June 30, 2009, but prior to the Maturity Date, the
Borrower may prepay all or any portion of the outstanding Principal and any
interest amount accrued thereon of the Note without any premium or penalty,
provided however, that if the Borrower then elects to prepay the Principal or
any part thereof, the Lender shall have the option to convert any such prepaid
Principal amount to shares of Common Stock at the Lender’s Conversion Price (as
defined in Section 3, here below).

       

      3.           Conversion.

       

      The Lender shall have the option, at
any time on or after July 01, 2009, but before the Maturity Date, to convert the
outstanding Principal of this Note into fully-paid and nonassessable shares of
Common Stock at the Lender’s Conversion Price (as defined below) described below
by providing the Borrower with a written notice (“Lender’s Conversion Notice”)
in the form attached hereto as Exhibit
A.  As used herein, the term “Lender’s Conversion Price” means,
as applicable,: (i) fifty cents ($0.50) per share of Common Stock; or (ii) if at
any time prior to the Maturity Date the Borrower enters into a New Transaction
(as defined below), the Lender’s Conversion Price shall be the New Transaction
Price, if lower than the prices provided in Section 3(i). As used herein, the
term “New Transaction Price” means the lowest effective purchase price,
conversion price or exercise price, as the case may be, in a New
Transaction.  As used herein, the term “New Transaction” means any
transaction entered into, directly or indirectly, by or for the benefit of the
Borrower after the date hereof and before the Maturity Date, pursuant to which
shares of Common Stock, or securities convertible or exercisable into shares of
Common Stock, are issued by the Borrower, except shares of Common Stock issued
under the Accelerize New Media Stock Option Plan.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      (a)           
To exercise any conversion, the holder of this Note, either upon receiving
Borrower’s Conversion Notice or upon delivering Lender’s Conversion Notice,
shall surrender this Note to the Borrower during usual business hours at the
offices of the Borrower, accompanied by a notice in the form attached hereto as
Exhibit A.

       

      (b)           As
promptly as practicable after the surrender of this Note by the Lender, the
Borrower shall deliver or cause to be delivered to the Lender, certificates for
the full number of shares of Common Stock issuable upon conversion of the
Principal and interest accrued thereon  under this Note, or any
portion thereof, in accordance with the provisions of this Note, together with a
duly executed new Note of the Borrower in the form of this Note for any
principal amount not so converted.  Such conversion shall be deemed to
have been made at the time that this Note was surrendered for conversion and the
notice specified herein shall have been received by the Borrower.

       

      (c)           The
number of shares of Common Stock issuable upon conversion of this Note or
repayment by the Borrower in shares of Common Stock shall be proportionately
adjusted if the Borrower shall declare a dividend of capital stock on its
capital stock (except the Pay-In-Kind dividends payable
to the holders of the Borrower’s 10% Series A Preferred Convertible Stock and
the 8% Series B Preferred Convertible Stock), or subdivide its outstanding
capital stock into a larger number of shares by reclassification, stock split or
otherwise, which adjustment shall be made effective immediately after the record
date in the case of a dividend, and immediately after the effective date in the
case of a subdivision. The number of shares of Common Stock issuable upon
conversion of this Note or any part thereof shall be proportionately adjusted in
the amount of securities for which the shares of Common Stock have been changed
or exchanged in another transaction for other stock or securities, cash and/or
any other property pursuant to a merger, consolidation or other
combination.  The Borrower shall promptly provide the holder of this
Note with notice of any events mandating an adjustment to the conversion ratio,
or for any planned merger, consolidation, share exchange or sale of the
Borrower, signed by the President and Chief Executive Officer of
Borrower.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      4.           Representations
and Warranties.  The Borrower represents and warrants as
follows:  (i) the Borrower is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware; (ii) the
execution, delivery and performance by the Borrower of this Note are within the
Borrower's powers, have been duly authorized by all necessary action, and do not
contravene (A) the Borrower's certificate of incorporation or by-laws or (B) (x)
any law or (y) any agreement or document binding on or affecting the Borrower,
(iii) no authorization or approval or other action by, and no notice to or
filing with, any governmental authority, regulatory body or third person is
required for the due execution, delivery and performance by the Borrower of this
Note; (iv) this Note constitutes the legal, valid and binding obligation of the
Borrower, enforceable against the Borrower in accordance with its terms except
as enforcement hereof may be limited by bankruptcy, insolvency or other similar
laws affecting the enforcement of creditors' rights generally and subject to the
applicability of general principles of equity; (v) the Borrower has all
requisite power and authority to own and operate its property and assets and to
conduct its business as now conducted and proposed to be conducted and to
consummate the transactions contemplated hereby; (vi)  the Borrower is
duly qualified to conduct its business and is in good standing in each
jurisdiction in which the character of the properties owned or leased by it, or
in which the transaction of its business makes such qualification necessary;
(vi) there is no pending or, to the Borrower's knowledge, threatened action or
proceeding affecting the Borrower before any governmental agency or arbitrator
which challenges or relates to this Note or which may otherwise have a material
adverse effect on the Borrower; and (viii) the Borrower has taken all required
action to reserve for issuance such number of shares of Common Stock as may be
issuable from time to time upon conversion of this Note.

       

      5.           Covenants.  So
long as any principal or interest is due hereunder and shall remain unpaid, the
Borrower will, unless the Lender shall otherwise consent in
writing:

       

      (a)           Maintain
and preserve its existence, rights and privileges;

       

      (b)           Not
incur any indebtedness other than: (i) bank financing (including without
limitation: revolving credit, asset-based borrowing, and note payable
obligations), (ii) debt financing provided by various Lenders under the terms of
this Note, and (iii) indebtedness incurred in the ordinary course of business or
outstanding on the date hereof, unless such indebtedness is subordinated to the
prior payment in full of this Note on terms reasonably satisfactory to the
Lender;

       

      (c)           Not
(i) directly or indirectly sell, lease or otherwise dispose of (A) any of its
property or assets other than in its ordinary course of business or (B)
substantially all of its properties and assets, in the aggregate, to any
person(s), whether in one transaction or in a series of transactions over any
period of time, (ii) merge into or with or consolidate with any other person or
(iii) adopt any plan or arrangement for the dissolution or liquidation of the
Borrower; and

       

      (d)           Comply
in all material respects with all applicable laws (whether federal, state or
local and whether statutory, administrative or judicial or other) and with every
applicable lawful governmental order (whether administrative or
judicial).

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      6.           Events of
Default.  Each and any of the following shall constitute a
default and, after expiration of the Grace Period, if any, shall constitute an
“Event of Default” hereunder:

       

      (a)           the
nonpayment of principal, late charges, or any other costs or expenses promptly
when due of any amount payable under this Note;

       

      (b)           any
other failure of the Borrower to observe or perform any covenant set forth in
this Note or in the Warrant dated the date hereof (other than a payment default
described above), which failure is not cured within thirty (30) days (the “Grace
period”) of Borrower’s receipt of a written notice that such failure exists and
is continuing, and should it not be cured within the Grace Period, it shall
constitute an Event of Default under this Note;

       

      (c)           if
Borrower shall commence any case, proceeding or other action: (i) under any
existing or future law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an
order for relief entered with respect to it, or seeking to adjudicate it
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
liquidation, dissolution, composition or other relief with respect to it or its
debts; or (ii) seeking appointment of a receiver, trustee, custodian or other
similar official for it or for all or any substantial part of its property, or
the Borrower shall make a general assignment for the benefit of its creditors;
or (iii) there shall be commenced against the Borrower any case, proceeding or
other action of a nature referred to above or seeking issuance of a warrant of
attachment, execution, distraint or similar process against all or any
substantial part of its property, which case, proceeding or other action results
in the entry of any order for relief or remains undismissed, undischarged or
unbonded for a period of one hundred twenty (120) days;

       

      (d)           any
representation or warranty made by the Borrower or any other person or entity
under this Note shall prove to have been incorrect in any material respect when
made;

       

      (e)           the
sale of all or substantially all of the assets, or change in controlling
ownership (i.e., change in excess of 50% Common Stock voting interest) or the
dissolution, liquidation, merger, consolidation, or reorganization of Borrower
without the Lender’s prior written consent; or

       

      (f)           the
Borrower’s shares of Common Stock are suspended from trading or delisted from
trading on the OTCBB for a period of more than sixty (60) consecutive
days.

       

      7.           Lender’s
Rights Upon Default.  Upon the occurrence of any Event of
Default, the Lender may, at its sole and exclusive option, do any or all of the
following, either concurrently or separately: (a) accelerate the maturity of
this Note and demand immediate payment in full, whereupon the outstanding
principal amount of the Note and all obligations of Borrower to Lender, together
with accrued interest thereon, shall become immediately due and payable; and (b)
exercise all legally available rights and privileges.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      8.           Commission.
The Borrower may engage various persons (each a “Finder”), on a non-exclusive
basis, to introduce Borrower to potential Lenders. Borrower, at its sole
discretion, may pay to each Finder up to 10% of the Principal amount made
available to Borrower under the terms of this Note by Lenders introduced to the
Borrower by such Finder.

       

      9.           Usury.  In
no event shall the amount of interest paid or agreed to be paid hereunder exceed
the highest lawful rate permissible under applicable law.  Any excess
amount of deemed interest shall be null and void and shall not interfere with or
affect the Borrower’s obligation to repay the principal of and interest on the
Note.  This confirms that the Borrower and, by its acceptance of this
Note, the Lender intend to contract in strict compliance with applicable usury
laws from time to time in effect.  Accordingly, the Borrower and the
Lender stipulate and agree that none of the terms and provisions contained
herein shall ever be construed to create a contract to pay, for the use or
forbearance of money, interest in excess of the maximum amount of interest
permitted to be charged by applicable law from time to time in
effect.

       

      10.           Assignment.   This
Note shall be binding upon and inure to the benefit of the Borrower and the
Lender and their respective successors and assigns; provided that
neither  Borrower nor Lender may assign this Note, in whole or in
part, by operation of law or otherwise, without the prior written consent of the
other party, which consent will not be unreasonably withheld or
delayed.

       

      11.           Governing
Law.  This Note, and any claims arising out of relating to this
Note, whether in contract or tort, statutory or common law, shall be governed
exclusively by, and construed in accordance with the laws of the State of New
York without regard to principles of conflicts of laws.

       

      12.           Jurisdiction.  EACH
OF BORROWER AND LENDER HEREBY CONSENTS THAT ANY LEGAL ACTION OR PROCEEDING
AGAINST IT UNDER, ARISING OUT OF OR IN ANY MANNER RELATING TO THIS NOTE, OR ANY
OTHER INSTRUMENT OR DOCUMENT EXECUTED AND DELIVERED IN CONNECTION HEREWITH SHALL
BE BROUGHT EXCLUSIVELY IN ANY COURT OF THE STATE OF NEW YORK OR IN THE UNITED
STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF NEW YORK, IN EACH CASE, IN THE
COUNTY OF NEW YORK.  EACH OF BORROWER AND LENDER HEREBY EXPRESSLY AND
IRREVOCABLY CONSENTS AND SUBMITS TO THE PERSONAL JURISDICTION OF ANY OF SUCH
COURTS IN ANY SUCH ACTION OR PROCEEDINGS.  EACH OF BORROWER AND LENDER
HEREBY AGREES THAT PERSONAL JURISDICTION OVER IT MAY BE OBTAINED BY THE DELIVERY
OF A SUMMONS BY PERSONAL DELIVERY OR OVERNIGHT COURIER AT THE ADDRESS PROVIDED
IN SECTION 15 OF THIS NOTE OR ANY OTHER ADDRESS AS SHALL BE PROVIDED BY SUCH
PARTY IN WRITING.  ASSUMING DELIVERY OF THE SUMMONS IN ACCORDANCE WITH
THIS PROVISION, EACH OF BORROWER AND LENDER HEREBY EXPRESSLY AND IRREVOCABLY
WAIVES ANY ALLEGED LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OF FORUM NON
CONVENIENS OR ANY SIMILAR BASIS.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      13.           Miscellaneous.
(a) If any provision of this Note shall for any reason be held to be invalid or
unenforceable, such invalidity or unenforceability shall not affect any other
provision hereof, but this Note shall be construed as if such invalid or
unenforceable provision had never been contained herein.  (b) The
waiver of any Event of Default or the failure of Lender to exercise any right or
remedy to which it may be entitled shall not be deemed a waiver of any
subsequent Event of Default or Lender’s right to exercise that or any other
right or remedy to which Lender is entitled.  No delay or omission by
Lender in exercising, or failure by Lender to exercise on any one or more
occasions, shall be construed as a waiver or novation of this Note or prevent
the subsequent exercise of any or all such rights.  (c) This Note may
not be waived, changed, modified, or discharged orally, but only in writing
signed by each of Borrower and Lender.

       

      14.           Notice,
Etc.  Any notice required by the provisions of this Note will
be in writing and will be deemed effectively given:  (a) upon personal
delivery to the party to be notified; (b) when sent by confirmed telex or
facsimile if sent during normal business hours of the recipient; if not, then on
the next business day; (c) five (5) days after having been sent by registered or
certified mail, return receipt requested, postage prepaid; or (d) one (1) day
after deposit with a nationally recognized overnight courier, specifying next
day delivery, with written verification of receipt, and delivered as
follows:

       

      If to the
Borrower:

      

      Accelerize
New Media

      12121
Wilshire Blvd., Suite 322

      Los
Angeles, CA 90025

      Attention:  Brian
Ross, President and Chief Executive Officer

      Facsimile
Number:  310-820 3220

      

      If to
Lender:

      

      NAME:       ________________________

      ADDRESS:
________________________

                    
      ________________________

      ATTN:        ________________________

      FAX:           ________________________

      

      or, as to
each party, at such other address as shall be designated by such party in a
written notice to the other parties

       

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      IN WITNESS WHEREOF, the
undersigned has executed this Note as of the date first set forth
above.

       

      

      ACCELERIZE NEW MEDIA,
INC.

      

      

      By:_______________________________

      Name: Brian Ross

      Title: President and Chief Executive
Officer

      

      

      STATE OF
_______________                        )

      )  ss:

      COUNTY OF
_______________                    )

      

      On this
___ day of __________, 2009, before me, personally came Brian Ross, to me known,
who being by me duly sworn, did depose and say, that he is the President and
Chief Executive Officer of Accelerize New Media, Inc. the corporation described
in and which executed the above instrument; and that he signed his name by
authority of the board of directors of said corporation.

      

      

      

      _______________________________

      Notary Public

       

      
 

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      EXHIBIT
A

      

      LENDER’S
CONVERSION NOTICE

      

      

      TO
ACCELERIZE NEW MEDIA, INC.

      ATTN:
BRIAN ROSS, PRESIDENT

      

       

      Please take notice that in accordance
with Section 3 of the foregoing Note, Lender hereby requires the Borrower to
convert __________ dollars ($________) of its remaining Principal and interest
due and owing to Lender under the Note into shares of Common Stock at the
Lender’s Conversion Price of $___ per share.

       

      Enclosed
herewith please find the original Note. Upon receipt of this notice together
with the original Note please issue to the undersigned stock certificate
representing ________ (______) shares of Common Stock.

       

      

      

      By:_____________________                                                                           Dated:
______________

      [LENDER’S
NAME]

      [LENDER’S
ADDRESS]ex4-2.htm

    EXHIBIT
4.2

    

    Form of Common Stock
Purchase Warrant

     

    FORM
OF COMMON STOCK PURCHASE WARRANT

    

    This warrant and the common stock
shares issuable upon exercise of this warrant have not been registered under the
securities act of 1933, as amended (the “Securities Act”). This warrant and the common stock
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
under the securities act or an opinion of counsel reasonably satisfactory to Accelerize New
Media, Inc. that such registration is not required.

    

    
      
        	 
      	
                Right
      to Purchase ______ shares of Common
      Stock of Accelerize New Media, Inc. (subject to adjustment as provided
      herein)

              

      

    

    

    FORM
OF COMMON STOCK PURCHASE WARRANT

    
    

     

    
      	No. CNII   	
              Issue
      Date:  _________, 2009

            

    

     

    ACCELERIZE
NEW MEDIA, INC., a corporation organized and existing under the laws of the
State of Delaware (the “Company”), hereby certifies that, for value received,
_________
or its assigns (the “Holder”) is entitled, subject to the terms set forth below,
to purchase from the Company at any time after the issue date (the “Issue Date”)
until 5:00 p.m., E.S.T. on the fifth (5th) anniversary of the Issue Date (the
“Expiration Date”), ______Thousand (00,000) fully paid
and nonassessable shares of Common Stock at a per share purchase price of
$0.55.  The afore described purchase price per share, as adjusted from
time to time as herein provided, is referred to herein as the “Purchase
Price.”  The number and character of such shares of Common Stock and
the Purchase Price are subject to adjustment as provided herein.  The
Company may reduce the Purchase Price without the consent of the
Holder.  Capitalized terms used and not otherwise defined herein shall
have the meanings set forth in that certain Convertible Promissory Note (the
“Note”) made by the Company to the Holder of the Warrant.

    

    As used
herein the following terms, unless the context otherwise requires, have the
following respective meanings:

    

    (a)           The
term “Company” shall include Accelerize New Media, Inc. and any corporation
which shall succeed or assume the obligations of Accelerize New Media, Inc.
hereunder.

    

    (b)           The
term “Common Stock” includes (a) the Company’s Common Stock, $0.001 par value
per share, and (b) any other securities into which or for which any of the
securities described in (a) may be converted or exchanged pursuant to a plan of
recapitalization, reorganization, merger, sale of assets or
otherwise.

    

    
      
        
        

      

      
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    (c)           The
term “Other Securities” refers to any stock (other than Common Stock) and other
securities of the Company or any other person (corporate or otherwise) which the
holder of the Warrant at any time shall be entitled to receive, or shall have
received, on the exercise of the Warrant, in lieu of or in addition to Common
Stock, or which at any time shall be issuable or shall have been issued in
exchange for or in replacement of Common Stock or Other Securities pursuant to
Section 4 herein or otherwise.

    

    (d)           The
term “Warrant Shares” shall mean the Common Stock issuable upon exercise of this
Warrant.

    

    1.           Exercise of
Warrant.

    

    1.1.           Number of Shares Issuable
upon Exercise.  From and after the Issue Date through and
including the Expiration Date, the Holder hereof shall be entitled to receive,
upon exercise of this Warrant in whole in accordance with the terms of
subsection 1.2 or upon exercise of this Warrant in part in accordance with
subsection 1.3, [00,000] of shares of Common Stock of the Company, subject to
adjustment pursuant to Section 4.

    

    1.2.           Full Exercise.  This
Warrant may be exercised in full by the Holder hereof by delivery of an original
or facsimile copy of the form of subscription attached hereto as Exhibit A (the
“Subscription Form”) duly executed by such Holder and surrender of the original
Warrant within four (4) days of exercise, to the Company at its principal office
or at the office of its Warrant Agent (as provided hereinafter), accompanied by
payment, in cash, wire transfer or by certified or official bank check payable
to the order of the Company, in the amount obtained by multiplying the number of
shares of Common Stock for which this Warrant is then exercisable by the
Purchase Price then in effect.

     

    1.3.           Partial
Exercise.  This Warrant may be exercised in part (but not for a
fractional share) by surrender of this Warrant in the manner and at the place
provided in subsection 1.2 except that the amount payable by the Holder on such
partial exercise shall be the amount obtained by multiplying (a) the number of
whole shares of Common Stock designated by the Holder in the Subscription Form
by (b) the Purchase Price then in effect.  On any such partial
exercise, the Company, at its expense, will forthwith issue and deliver to or
upon the order of the Holder hereof a new Warrant of like tenor, in the name of
the Holder hereof or as such Holder (upon payment by such Holder of any
applicable transfer taxes) may request, the whole number of shares of Common
Stock for which such Warrant may still be exercised.

     

    1.4.           Fair Market Value.
Fair Market Value of a share of Common Stock as of a particular date (the
“Determination Date”) shall mean:

     

    (a)           If
the Company’s Common Stock is traded on an exchange or is quoted on the Nasdaq
Stock Market, Inc., then the last sale price reported for the last business day
immediately preceding the Determination Date;

     

    (b)           If
the Company’s Common Stock is not traded on an exchange or quoted on the Nasdaq
Stock Market, Inc. but is traded in the over-the-counter market, then the
average of the closing bid and ask prices reported for the last business day
immediately preceding the Determination Date;

     

    
      
        
        

      

      
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    (c)           Except
as provided in clause (d) below, if the Company’s Common Stock is not publicly
traded, then as the Holder and the Company agree, or in the absence of such an
agreement, by arbitration in accordance with the rules then standing of the
American Arbitration Association, before a single arbitrator to be chosen from a
panel of persons qualified by education and training to pass on the matter to be
decided; or

     

    (d)           If
the Determination Date is the date of a liquidation, dissolution or winding up,
or any event deemed to be a liquidation, dissolution or winding up pursuant to
the Company’s charter, then all amounts to be payable per share to holders of
the Common Stock pursuant to the charter in the event of such liquidation,
dissolution or winding up, plus all other amounts to be payable per share in
respect of the Common Stock in liquidation under the charter, assuming for the
purposes of this clause (d) that all of the shares of Common Stock then issuable
upon exercise of all of the Warrants are outstanding at the Determination
Date.

     

    1.5.           Company
Acknowledgment. The Company will, at the time of the exercise of the
Warrant, upon the request of the Holder hereof acknowledge in writing its
continuing obligation to afford to such Holder any rights to which such Holder
shall continue to be entitled after such exercise in accordance with the
provisions of this Warrant. If the Holder shall fail to make any such request,
such failure shall not affect the continuing obligation of the Company to afford
to such Holder any such rights.

     

    1.6.           Delivery of Stock
Certificates, etc. on Exercise.  The Company agrees that the
shares of Common Stock purchased upon exercise of this Warrant shall be deemed
to be issued to the Holder hereof as the record owner of such shares as of the
close of business on the date on which this Warrant shall have been surrendered
and payment made for such shares as aforesaid. As soon as practicable after the
exercise of this Warrant in full or in part, and in any event within three (3)
business days thereafter, the Company at its expense (including the payment by
it of any applicable issue taxes) will cause to be issued in the name of and
delivered to the Holder hereof, or as such Holder (upon payment by such Holder
of any applicable transfer taxes) may direct in compliance with applicable
securities laws, a certificate or certificates for the number of duly and
validly issued, fully paid and nonassessable shares of Common Stock (or Other
Securities) to which such Holder shall be entitled on such exercise, plus, in
lieu of any fractional share to which such Holder would otherwise be entitled,
cash equal to such fraction multiplied by the then Fair Market Value of one full
share of Common Stock, together with any other stock or other securities and
property (including cash, where applicable) to which such Holder is entitled
upon such exercise pursuant to Section 1 or otherwise.

     

    1.7.           Forced Exercise by the
Company.   The Company reserves the right to call the
Warrants, at a redemption price of $.001 per Warrant, commencing on the first
trading day after the Common Stock of the Company has traded for ten (10)
consecutive days at an average closing price at or exceeding $1.25 per share.
The call may be made within ten (10) days from the date the Company’s Common
Stock satisfies the average trading price described above, but the Company is
not required to make any such call and may make the call on the terms described
at any future date where the trading price of the common stock satisfies the
above criterion. Investors will have thirty (30) days from the date of such
notice to exercise the Warrants, and in the event the Warrants are not
exercised, the Company may cancel them, and investors will receive payment of
$0.001 per Warrant share.  The Company will also have the right to
assign the right to exercise the Warrant for a period of thirty (30) days to
another Purchaser in this offering or to any other person whether or not such
person is an existing shareholder of the Company.  Investors will not
receive any proceeds in the event such other person exercises the
Warrant.

     

    
      
        
        

      

      
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    2.           Adjustments.

     

    2.1.           Reorganization,
Consolidation, Merger, etc.  In case at any time or from time
to time, the Company shall (a) effect a reorganization, (b) consolidate with or
merge into any other person or (c) transfer all or substantially all of its
properties or assets to any other person under any plan or arrangement
contemplating the dissolution of the Company, then, in each such case, as a
condition to the consummation of such a transaction, proper and adequate
provision shall be made by the Company whereby the Holder of this Warrant, on
the exercise hereof as provided in Section 1, at any time after the consummation
of such reorganization, consolidation or merger or the effective date of such
dissolution, as the case may be, shall receive, in lieu of the Common Stock (or
Other Securities) issuable on such exercise prior to such consummation or such
effective date, the stock and other securities and property (including
cash) to which such Holder would have been entitled upon such consummation or in
connection with such dissolution, as the case may be, if such Holder had so
exercised this Warrant, immediately prior thereto, all subject to further
adjustment thereafter as provided in Section 3.

    

    2.2.           Dissolution.  In
the event of any dissolution of the Company following the transfer of all or
substantially all of its properties or assets, the Company, prior to such
dissolution, shall at its expense deliver or cause to be delivered the stock and
other securities and property (including cash, where applicable) receivable in
accordance with Section 2.1 by the Holder of the Warrants upon their exercise
after the effective date of such dissolution pursuant to this Section
2.

    

    2.3.           Continuation of
Terms.  Upon any reorganization, consolidation, merger or
transfer (and any dissolution following any transfer) referred to in this
Section 2, this Warrant shall continue in full force and effect and the terms
hereof shall be applicable to the Other Securities and property receivable on
the exercise of this Warrant after the consummation of such reorganization,
consolidation or merger or the effective date of dissolution following any such
transfer, as the case may be, and shall be binding upon the issuer of any Other
Securities, including, in the case of any such transfer, the person acquiring
all or substantially all of the properties or assets of the Company, whether or
not such person shall have expressly assumed the terms of this Warrant as
provided in Section 3.

    

    3.           Extraordinary Events
Regarding Common Stock.  In the event that the Company shall
(a) subdivide its outstanding shares of Common Stock, or (b) combine its
outstanding shares of the Common Stock into a smaller number of shares of the
Common Stock, then, in each such event, the Purchase Price shall, simultaneously
with the happening of such event, be adjusted by multiplying the then Purchase
Price by a fraction, the numerator of which shall be the number of shares of
Common Stock outstanding immediately prior to such event and the denominator of
which shall be the number of shares of Common Stock outstanding immediately
after such event, and the product so obtained shall thereafter be the Purchase
Price then in effect. The Purchase Price, as so adjusted, shall be readjusted in
the same manner upon the happening of any successive event or events described
herein in this Section 3. The number of shares of Common Stock that the Holder
of this Warrant shall thereafter, on the exercise hereof as provided in Section
1, be entitled to receive shall be adjusted to a number determined by
multiplying the number of shares of Common Stock that would otherwise (but for
the provisions of this Section 3) be issuable on such exercise by a
fraction of which (a) the numerator is the Purchase Price that would otherwise
(but for the provisions of this Section 3) be in effect, and (b) the denominator
is the Purchase Price in effect on the date of such exercise.

     

    
      
        
        

      

      
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    4.           Certificate as to
Adjustments.  In each case of any adjustment or readjustment in
the shares of Common Stock (or Other Securities) issuable on the exercise of the
Warrants, the Company at its expense will promptly cause its Chief Financial
Officer or other appropriate designee to compute such adjustment or readjustment
in accordance with the terms of the Warrant and prepare a certificate setting
forth such adjustment or readjustment and showing in detail the facts upon which
such adjustment or readjustment is based, including a statement of (a) the
consideration received or receivable by the Company for any additional shares of
Common Stock (or Other Securities) issued or sold or deemed to have been issued
or sold, (b) the number of shares of Common Stock (or Other Securities)
outstanding or deemed to be outstanding, and (c) the Purchase Price and the
number of shares of Common Stock to be received upon exercise of this Warrant,
in effect immediately prior to such adjustment or readjustment and as adjusted
or readjusted as provided in this Warrant. The Company will forthwith mail a
copy of each such certificate to the Holder of the Warrant and any Warrant Agent
of the Company (appointed pursuant to Section 9 hereof).

     

    5.           Reservation of
Stock, etc.
Issuable on Exercise of Warrant; Financial Statements.  The
Company will at all times reserve and keep available, solely for issuance and
delivery on the exercise of the Warrants, all shares of Common Stock (or Other
Securities) from time to time issuable on the exercise of the
Warrant.  This Warrant entitles the Holder hereof to receive copies of
all financial and other information distributed or required to be distributed to
the holders of the Company’s Common Stock.

     

    6.           Assignment; Exchange of
Warrant.  Subject
to compliance with applicable securities laws, this Warrant, and the rights
evidenced hereby, may be transferred by any registered holder hereof (a
“Transferor”). On the surrender for exchange of this Warrant, with the
Transferor’s endorsement in the form of Exhibit B attached hereto (the
“Transferor Endorsement Form”) and together with an opinion of counsel
reasonably satisfactory to the Company that the transfer of this Warrant will be
in compliance with applicable securities laws, the Company at its expense, once,
only, but with payment by the Transferor of any applicable transfer taxes, will
issue and deliver to or on the order of the Transferor thereof a new Warrant or
Warrants of like tenor, in the name of the Transferor and/or the transferee(s)
specified in such Transferor Endorsement Form (each a “Transferee”), calling in
the aggregate on the face or faces thereof for the number of shares of Common
Stock called for on the face or faces of the Warrant so surrendered by the
Transferor.  No such transfers shall result in a public distribution
of the Warrant.

     

    
      
        
        

      

      
        Page 5

        
          

        

      

      
        
        

      

    

    7.           Replacement of
Warrant.  On receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant and, in
the case of any such loss, theft or destruction of this Warrant, on delivery of
an indemnity agreement or security reasonably satisfactory in form and amount to
the Company or, in the case of any such mutilation, on surrender and
cancellation of this Warrant, the Company at its expense, twice only, will
execute and deliver, in lieu thereof, a new Warrant of like tenor.

    

    8.           Warrant
Agent.  The Company may, by written notice to the Holder of the
Warrant, appoint an agent (a “Warrant Agent”) for the purpose of issuing Common
Stock (or Other Securities) on the exercise of this Warrant pursuant to Section
1, exchanging this Warrant pursuant to Section 6, and replacing this Warrant
pursuant to Section 7, or any of the foregoing, and thereafter any such
issuance, exchange or replacement, as the case may be, shall be made at such
office by such Warrant Agent.

    

    9.           Transfer on the
Company’s
Books.  Until this Warrant is transferred on the books of the
Company, the Company may treat the registered holder hereof as the absolute
owner hereof for all purposes, notwithstanding any notice to the
contrary.

     

    10.           Notices.   All
notices, demands, requests, consents, approvals, and other communications
required or permitted hereunder shall be in writing and, unless otherwise
specified herein, shall be (i) personally served, (ii) deposited in the mail,
registered or certified, return receipt requested, postage prepaid, (iii)
delivered by reputable air courier service with charges prepaid, or (iv)
transmitted by hand delivery, telegram, or facsimile, addressed as set forth
below or to such other address as such party shall have specified most recently
by written notice.  Any notice or other communication required or
permitted to be given hereunder shall be deemed effective (a) upon hand delivery
or delivery by facsimile, with accurate confirmation generated by the
transmitting facsimile machine, at the address or number designated below (if
delivered on a business day during normal business hours where such notice is to
be received), or the first business day following such delivery (if
delivered other than on a business day during normal business hours where such
notice is to be received) or (b) on the second business day following the date
of mailing by express courier service, fully prepaid, addressed to such address,
or upon actual receipt of such mailing, whichever shall first occur or (c) three
business days after deposited in the mail if delivered pursuant to subsection
(ii) above.  The addresses for such communications shall be: (i) if to
the Company to: 12121 WILSHIRE BLVD., SUITE 322, LOS ANGELES, CALIFORNIA 90025,
telecopier:  (310) 903 4001, and (ii) if to the Holder, to the
addresses and telecopier number set forth in the first paragraph of this
Warrant.  The Company may change its address for notices but only to
an address and fax number located in the United States.

    

    11.           Miscellaneous.  This
Warrant and any term hereof may be changed, waived, discharged or terminated
only by an instrument in writing signed by the party against which enforcement
of such change, waiver, discharge or termination is sought. This Warrant shall
be construed and enforced in accordance with and governed by the laws of New
York.  Any dispute relating to this Warrant shall be adjudicated in
New York County in the State of New York.  The headings in this
Warrant are for purposes of reference only, and shall not limit or otherwise
affect any of the terms hereof.  The invalidity or unenforceability of
any provision hereof shall in no way affect the validity or enforceability of
any other provision.

    

    
      
        
        

      

      
        Page 6

        
          

        

      

      
        
        

      

    

     

    IN
WITNESS WHEREOF, the Company has executed this Warrant as of the date first
written above.

     

    ACCELERIZE NEW MEDIA,
INC.

    

    By:_____________________________

    

    Name: Brian
Ross

    

    Title: Chief Executive
Officer

     

     

    
      
        
        

      

      
        Page 7

        
          

        

      

      
        
        

      

    

    Exhibit
A

    

    FORM OF
SUBSCRIPTION

    (to be
signed only on exercise of Warrant)

     

    TO:    ACCELERIZE
NEW MEDIA, INC.

     

    The
undersigned, pursuant to the provisions set forth in the attached Warrant
(No.CNII),
hereby irrevocably elects to purchase (check applicable box):

    

    ________
shares of the Common Stock covered by such Warrant;

     

    The
undersigned herewith makes payment of the full purchase price for such shares at
the price per share provided for in such Warrant, which is
$___________.  Such payment takes the form of a check in the face
amount of $_______:

    

    The
undersigned requests that the certificates for such shares be issued in the name
of, and delivered to ______________________________ whose address is
________________________________________________________________________

    

    The
undersigned represents and warrants that the representations and warranties in
Section 4 of the Note (as defined in this Warrant) are true and accurate with
respect to the undersigned on the date hereof.

    

    The
undersigned represents and warrants that all offers and sales by the undersigned
of the securities issuable upon exercise of the within Warrant shall be made
pursuant to registration of the Common Stock under the Securities Act, or
pursuant to an exemption from registration under the Securities
Act.

    

    Dated:_____________________________________

     

     

    _______________________________________

    (Signature
must conform to name of

    holder as
specified on the fact of theWarrant.)

     

    _______________________________________

     

    _______________________________________

    (Address)

     

    
      
        
        

      

      
        Page 8

        
          

        

      

      
        
        

      

    

    Exhibit
B

    

    FORM OF
TRANSFEROR ENDORSEMENT

    (To be
signed only on transfer of Warrant)

     

    For value
received, the undersigned hereby sells, assigns, and transfers unto the
person(s) named below under the heading “Transferees” the right represented by
the within Warrant to purchase the percentage and number of shares of Common
Stock of ACCELERIZE NEW MEDIA, INC. to which the within Warrant relates
specified under the headings “Percentage Transferred” and “Number Transferred,”
respectively, opposite the name(s) of such person(s) and appoints each such
person Attorney to transfer its respective right on the books of ACCELERIZE NEW
MEDIA, INC. with full power of substitution in the premises.

     

    
      	
              Transferees

            	
              Percentage Transferred

            	
              Number Transferred

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      

    

    

    

    
      	
              Dated:  ______________,
      ___________

               

               

               

              Signed
      in the presence of:

               

              ________________________________

              (Name)

               

               

              ACCEPTED
      AND AGREED:

              TRANSFEREE

               

              ________________________________

              (Name)

            	
              ____________________________________________

              (Signature
      must conform to name of holder as

              specified
      on the face of the warrant)

               

               

               

              ___________________________________________________

              ___________________________________________________

              (address)

               

              _____________________________________________

              _____________________________________________

              (address)

            

    

     

    

    
 

    Page
9

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