Document:

exhibit103.htm

EXHIBIT 10.3

STOCK PLEDGE AGREEMENT

 

This STOCK PLEDGE AGREEMENT (this (“Agreement”) is made this 18th day of March, 2010 by and between SILICON VALLEY BANK, a California corporation with a loan production office located at 380 Interlocken Crescent, Suite
600, Broomfield, Colorado 80021  (“Bank”), and WIRELESS RONIN TECHNOLOGIES, INC. (“Pledgor”), with offices located at 5929 Baker Road, Suite 475, Minneapolis, Minnesota 55345.

 

RECITALS

 

Bank proposes to make certain loans to Pledgor, a Minnesota corporation pursuant to a Loan and Security Agreement dated as of even date herewith (the “Loan Agreement”).  To secure the Obligations, as defined in the Loan Agreement, Pledgor has agreed to pledge to
Bank one hundred percent (100%) of the outstanding capital stock of each Subsidiary listed on Exhibit A hereto (the “Pledged Subsidiaries”), in each case in which Pledgor now owns or hereafter acquires an interest (collectively, the “Shares”).  The current issued and outstanding Shares are also listed
on Exhibit A hereto.  Any capitalized terms used without definition herein shall have the meanings assigned to them in the Loan Agreement.

 

NOW, THEREFORE, Pledgor and Bank agree as follows:

 

1.           Pledge of Securities.

 

A.           Pledgor hereby pledges, assigns and delivers to Bank and grants to Bank a security interest in the Shares, together with all proceeds and substitutions thereof, all cash, stock and other moneys and property paid thereon, all rights to subscribe for securities declared or
granted in connection therewith, and all other cash and noncash proceeds of the foregoing (all hereinafter called the “Pledged Collateral”), as security for the prompt performance of all of the Obligations, as defined in the Loan Agreement, and Pledgor’s obligations hereunder.

 

B.           The term “Pledged Collateral” shall also include any securities, instruments or distributions of any kind issuable, issued or received by Pledgor upon conversion of, in respect of, or in exchange for any other Pledged Collateral, including, but not limited to,
those arising from a stock dividend, stock split, reclassification, reorganization, merger, consolidation, sale of assets or other exchange of securities or any dividends or other distributions of any kind upon or with respect to the Pledged Collateral.

 

C.           The certificate or certificates for the securities included in the Pledged Collateral (if such securities are certificated), accompanied by an instrument of assignment duly executed in blank by Pledgor, have been, or will be immediately upon the subsequent receipt thereof
by Pledgor, delivered by Pledgor to Bank.  To the extent such securities are uncertificated, Pledgor hereby acknowledges and agrees that such securities shall only be certificated after prior written notice has been provided to Bank, and upon such certification, such securities shall promptly be delivered to Bank, accompanied by an instrument of assignment duly executed in blank by Pledgor.  Pledgor shall cause the books of each Pledged Subsidiary to reflect the pledge of the Shares.  Upon
the occurrence and during the continuance of an Event of Default hereunder, Bank may effect the transfer of any securities included in the Pledged Collateral into the name of Bank and cause new certificates representing such securities to be issued in the name of Bank.  Pledgor will execute and deliver such documents, and take or cause to be taken such actions, as Bank may reasonably request to perfect or continue the perfection of Bank’s security interest in the Pledged Collateral.

 

 

 

 

D.           Pledgor agrees to execute any further instruments and take further action as Bank reasonably requests to perfect or continue Bank’s Lien in the Pledged Collateral or to effect the purposes of this Agreement.

 

2.           Representations, Warranties and Covenants.  Pledgor represents and warrants to and covenants with Bank that:

 

A.           The Pledged Collateral is owned by Pledgor free and clear of any security interests, liens or encumbrances, subject to applicable foreign law with respect to Foreign Subsidiaries;

 

B.           Pledgor has full power and authority to create a first lien, subject to applicable foreign law with respect to Foreign Subsidiaries, on the Pledged Collateral in favor of Bank and no disability or contractual obligation exists which would prohibit Pledgor from pledging the
Pledged Collateral pursuant to this Agreement, and Pledgor will not assign, create or permit to exist any other claim to, lien or encumbrance upon, or security interest in any of the Pledged Collateral;

 

C.           There are no subscriptions, warrants or other options exercisable with respect to the Shares;

 

D.           The Shares have been duly authorized and validly issued, and are fully paid and non-assessable; and

 

E.           The Pledged Collateral is not the subject of any present or threatened suit, action, arbitration, administrative or other proceeding, and Pledgor knows of no reasonable grounds for the institution of any such proceedings.

 

All the above representations and warranties shall survive the making of this Agreement.

 

3.           Voting Prior to Demand.  Unless an Event of Default (as defined below) shall have occurred and be continuing, Pledgor shall be entitled to exercise any voting rights with respect to the Pledged Collateral
and to give consents, waivers and ratifications in respect thereof, provided that no vote shall be cast or consent, waiver or ratification given or action taken which would be inconsistent with any of the terms of this Agreement or which would constitute or create any violation of any of such terms.  All such rights of Pledgor to vote and give consents, waiver and ratifications shall upon notice to Pledgor cease in case such an Event of Default hereunder shall occur and be continuing.

 

4.           Events of Default.  Each of the following shall constitute an event of default (“Event of Default”) hereunder:

 

A.           The occurrence of an Event of Default under the Loan Agreement; or

 

B.           The breach of any provision of this Agreement by Pledgor or the failure by Pledgor to observe or perform any of the provisions of this Agreement (in any case, after giving effect to any applicable cure or grace period).

 

 

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5.           Bank’s Remedies Upon Default.

 

A.           Upon the occurrence and during the continuance of an Event of Default, Bank shall have the right, subject to applicable foreign law with respect to Foreign Subsidiaries,  to exercise all such rights as a secured party under the Uniform Commercial Code of the State
of Illinois as it, in its sole judgment, shall deem necessary or appropriate, including the right to sell all or any part of the Pledged Collateral at one or more public or private sales upon ten (10) days’ written notice to Pledgor, and any such sale or sales may be made for cash, upon credit, or for future delivery, and in connection therewith, Bank may grant options, provided that any such terms or options shall, in the best judgment of Bank, be extended only in order to obtain the best possible price.

 

B.           Pledgor recognizes that Bank may be unable to effect a public sale of all or a part of the Pledged Collateral by reason of certain prohibitions contained in the Securities Act of 1933, as amended (the “Act”),
so that Bank may be compelled to resort to one or more private sales to a restricted group of purchasers who will be obliged to agree, among other things, to acquire the Pledged Collateral for their own account, for investment and without a view to the distribution or resale thereof.  Pledgor understands that private sales so made may be at prices and on other terms less favorable to the seller than if the Pledged Collateral were sold at public sales, and agrees that Bank has no obligation to delay
the sale of any of the Pledged Collateral for the period of time necessary (even if Bank would agree), to register such securities for sale under the Act.  Pledgor agrees that private sales made under the foregoing circumstances shall be deemed to have been made in a commercially reasonable manner.

 

C.           After the sale of any of the Pledged Collateral, Bank may deduct all reasonable legal and other expenses and attorney’s fees for preserving, collecting, selling and delivering the Pledged Collateral and for enforcing its rights with respect to the Obligations, and shall
apply the residue of the proceeds to the Obligations in such manner as Bank in its reasonable discretion shall determine, and shall pay the balance, if any to Pledgor.

 

6.           Pledgor Waivers.  Pledgor waives any right to require Bank to (a) proceed against the Pledged Subsidiaries, any guarantor or any other person; (b) proceed against or exhaust any security
held from the Pledged Subsidiaries; (c) marshal any assets of the Pledged Subsidiaries; or (d) pursue any other remedy in Bank’s power whatsoever.  Bank may, at its election, exercise or decline or fail to exercise any right or remedy it may have against the Pledged Subsidiaries or any security held by Bank, including without limitation the right to foreclose upon any such security by judicial or nonjudicial sale, without affecting or impairing in any way the liability of Pledgor hereunder.  Pledgor
waives any defense arising by reason of any disability or other defense of the Pledged Subsidiaries or by reason of the cessation from any cause whatsoever of the liability of the Pledged Subsidiaries.  Until the indefeasible payment in full of the Obligations, Pledgor waives (i) any setoff, defense or counterclaim that Pledgor or any of the Pledged Subsidiaries may have against Bank; (ii) waives any right of subrogation or reimbursement, contribution or other rights against the Pledged Subsidiaries;
(iii) any right to enforce any remedy that Bank now has or may hereafter have against any of the Pledged Subsidiaries; (iv) any defense arising out of the absence, impairment or loss of any right of reimbursement or subrogation or any other rights against any of the Pledged Subsidiaries; (v) all rights to participate in any security now or hereafter held by Bank; and (vi) all presentments, demands for performance, notices of nonperformance, protests, notices of protest, notices of dishonor, notices of acceptance
of this Agreement, notices of any default, notices of payment and nonpayment, or any nonpayment at maturity, notices of release, compromise, settlement, extension, or renewal of accounts, documents, instruments, chattel paper, and guarantees at any time held by Bank on which Pledgor may in any way be liable, and notices of the existence, creation, or incurring of new or additional indebtedness, in each case other than as specifically provided for in the Loan Documents.  Pledgor assumes the responsibility
for being and keeping itself informed of the financial condition of the Pledged Subsidiaries and of all other circumstances bearing upon the risk of nonpayment of any indebtedness or nonperformance of any obligation of Pledgor, warrants to Bank that it will keep so informed, and agrees that absent a request for particular information by Pledgor, Bank shall have no duty to advise Pledgor of information known to Bank regarding such condition or any such circumstances.

 

 

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7.           Insolvency.  If Pledgor becomes insolvent or is adjudicated bankrupt or file a petition for reorganization, arrangement, composition or similar relief under any present or future provision of the United
States Bankruptcy Code, or if such a petition is filed against Pledgor, and in any such proceeding some or all of any indebtedness or obligations under the Loan Documents are terminated or rejected or any obligation of Pledgor is modified or abrogated, or if Pledgor’s obligations are otherwise avoided for insolvency, bankruptcy or any similar reason, Pledgor agrees that Pledgor’s liability hereunder shall not thereby be affected or modified and such liability shall continue in full force and effect
as if no such action or proceeding had occurred.  This Agreement shall continue to be effective or be reinstated, as the case may be, if any payment must be returned by Bank upon the insolvency, bankruptcy or reorganization of Pledgor, any other person, or otherwise, as though such payment had not been made.

 

8.           Intentionally deleted.

 

9.           Notices.  Unless otherwise provided in this Agreement, all notices or demands by any party relating to this Agreement or any other agreement entered into in connection herewith shall be in writing
and (except for financial statements and other informational documents which may be sent by first-class mail, postage prepaid) shall be personally delivered or sent by certified mail, postage prepaid, return receipt requested, or by prepaid telefacsimile to Pledgor or to Bank, as the case may be, at its addresses set forth below.  Such notice shall be deemed effective three (3) days after deposit if sent by first class mail, upon actual receipt if personally delivered or sent by certified mail, or upon
confirmed transmission if sent via telefacsimile.

 

 

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If to Pledgor:                        Wireless Ronin Technologies, Inc.

 

          5920 Baker Road, suite 475

 

          Minneapolis, Minnesota 55345

 

          Attn: Mr. Darin McAreavey

 

          Fax:  (952) 974-7887

 

          Email: dmcareavey@wirelessronin.com

 

If to Bank:                             Silicon Valley Bank

 

          380 Interlocken Crescent, Suite
600

 

          Broomfield, Colorado 80021

 

          Attn: Mr. Adam Glick

 

         Fax:  (617)
880-3456

 

         Email: aglick@svb.com

 

	
  
	
with a copy to:
	
Riemer & Braunstein LLP

 

	
  
	
Three Center Plaza

 

	
  
	
Boston, Massachusetts 02108

 

	
  
	
Attn:  Charles W. Stavros, Esquire

 

	
  
	
Fax: (617) 880-3456

 

	
  
	
Email: cstavros@riemerlaw.com

 

The parties hereto may change the address at which they are to receive notices hereunder, by notice in writing in the foregoing manner given to the other.

 

10.           CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER

 

The laws of the State of Illinois shall apply to this Agreement.  PLEDGOR ACCEPTS FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, UNCONDITIONALLY, THE NON-EXCLUSIVE JURISDICTION OF ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE OF ILLINOIS IN ANY ACTION, SUIT, OR PROCEEDING OF ANY KIND, AGAINST IT WHICH ARISES
OUT OF OR BY REASON OF THIS AGREEMENT.  NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH HEREINABOVE, BANK SHALL SPECIFICALLY HAVE THE RIGHT TO BRING ANY ACTION OR PROCEEDING AGAINST PLEDGOR OR ITS PROPERTY IN THE COURTS OF ANY OTHER JURISDICTION WHICH BANK DEEMS NECESSARY OR APPROPRIATE IN ORDER TO REALIZE ON THE COLLATERAL OR TO OTHERWISE ENFORCE BANK’S RIGHTS AGAINST PLEDGOR OR ITS PROPERTY.

 

PLEDGOR AND BANK EACH HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS.  EACH
PARTY RECOGNIZES AND AGREES THAT THE FOREGOING WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR IT TO ENTER INTO THIS AGREEMENT.  EACH PARTY REPRESENTS AND WARRANTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL.

 

 

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11.           Amendment of Loan Documents.  Pledgor authorizes Bank, without notice or demand and without affecting its liability hereunder, from time to time to apply such security and direct the order or manner
of sale thereof as set forth in the Loan Agreement.  This Agreement may not be amended or modified except by a written instrument signed by Bank and Pledgor.

 

12.           This Agreement and the agreements and instruments executed in connection therewith constitute the entire agreement between Bank and Pledgor with respect to the subject matter hereof and supersede all prior agreements, understandings, offers and negotiations, oral or written.

 

13.           This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which shall together constitute one and the same document.

 

14.           Upon payment in full of the Obligations and at such time as Bank’s obligation to make Credit Extension has terminated, Bank shall release its lien and security interests in Pledged Collateral and all rights therein shall revert to Pledgor.

 

[Signature page follows.]

 

	
 

 

  

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as a sealed instrument under the laws of the State of Illinois, as of the date first written above.

 

PLEDGOR:

 

WIRELESS RONIN TECHNOLOGIES, INC.

 

By: /s/ Darin McAreavey

 

Name: Darin McAreavey

 

Title: CFO

 

BANK:

 

        SILICON VALLEY BANK

 

By: /s/ Adam Glick

 

Name: Adam Glick

 

Title: Relationship Manager

 

  

  

  

Exhibit A

 

Pledged Shares

 

	
 

Pledgor
	
Issuer
	
Interest in Issuer
	
% of

Ownership
	
% of

Ownership Pledged*

	
WIRELESS RONIN TECHNOLOGIES, INC.
	
WIRELESS RONIN TECHNOLOGIES (CANADA), INC.
	
Shares
	
100%
	
100%

	  	  	  	  	  
	  	  	  	  	  
	  	  	  	  	  
	  	  	  	  	  
	  	  	  	  	  
	  	  	  	  	  

 

* If and/or when certificated, such stock and/or membership interest certificates shall be delivered to Bank, together with a stock/membership power executed in blank.exhibit104.htm

EXHIBIT 10.4

THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE AND, EXCEPT AND PURSUANT TO THE PROVISIONS OF ARTICLE 5 BELOW, MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED
UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAW OR, IN THE OPINION OF LEGAL COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS EXEMPT FROM REGISTRATION.

 

WARRANT TO PURCHASE STOCK

Company:  Wireless Ronin Technologies, Inc., a Minnesota corporation

Number of Shares:  41,391, subject to adjustment

Class of Stock:  Common Stock, $0.01 par value per share

Warrant Price:  $2.90, subject to adjustment

Issue Date:  March 18, 2010

Expiration Date:  March 18, 2020

Credit Facility:  This Warrant is issued in connection with that certain Loan and Security Agreement of even date herewith between Silicon Valley Bank and the Company.

THIS WARRANT CERTIFIES THAT, for good and valuable consideration, SILICON VALLEY BANK (Silicon Valley Bank, together with any successor or permitted assignee or transferee of this Warrant or of any shares issued upon exercise hereof, is referred to hereinafter as "Holder") is entitled to purchase the number of fully paid and non-assessable
shares (the "Shares") of the class of stock (the “Class”) of the above-named company (the "Company") at the above-stated Warrant Price per Share, all as set forth above and as adjusted pursuant to Article 2 of this Warrant, subject to the provisions and upon the terms and conditions set forth in this Warrant.

 

ARTICLE 1. EXERCISE.

1.1           Method of Exercise.  Holder may exercise this Warrant by delivering the original of this Warrant together with a duly executed Notice of Exercise in
substantially the form attached as Appendix 1 to the principal office of the Company.  Unless Holder is exercising the conversion right set forth in Article 1.2, Holder shall also deliver to the Company a check, wire transfer (to an account designated by the Company), or other form of payment acceptable to the Company for the aggregate Warrant Price for the Shares being purchased.

1.2           Conversion Right.  In lieu of exercising this Warrant as specified in Article 1.1, Holder may from time to time convert this Warrant, in whole or in
part, into a number of Shares determined by dividing (a) the aggregate fair market value of the Shares or other securities otherwise issuable upon exercise of this Warrant minus the aggregate Warrant Price of such Shares by (b) the fair market value of one Share.  The fair market value of the Shares shall be determined pursuant to Article 1.3.

 

 

 

1.3           Fair Market Value.  If the Company’s common stock is then traded in a public market, the fair market value of a Share shall be the closing price
of a share of common stock reported for the business day immediately before Holder delivers this Warrant together with its Notice of Exercise to the Company.  If the Company’s common stock is not then traded in a public market, the Board of Directors of the Company shall determine fair market value in its reasonable good faith judgment.

1.4           Delivery of Certificate and New Warrant.  Promptly after Holder exercises or converts this Warrant and, if applicable, the Company receives payment
of the aggregate Warrant Price, the Company shall deliver to Holder certificates for the Shares acquired and, if this Warrant has not been fully exercised or converted and has not expired, a new Warrant representing the Shares not so acquired.

1.5           Replacement of Warrants.  On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant
and, in the case of loss, theft or destruction, on delivery of an indemnity agreement reasonably satisfactory in form and amount to the Company or, in the case of mutilation, on surrender and cancellation of this Warrant, the Company shall execute and deliver, in lieu of this Warrant, a new warrant of like tenor.

1.6           Treatment of Warrant Upon Acquisition of Company.

1.6.1           "Acquisition".  For the purpose of this Warrant, "Acquisition" means any sale, license, or other disposition of all or substantially all of the assets
of the Company, or any reorganization, consolidation, merger or sale of outstanding capital stock of the Company where the holders of the Company's securities before the transaction beneficially own less than a majority of the outstanding voting securities of the surviving entity after the transaction.

	
  
	
1.6.2
	
Treatment of Warrant at Acquisition.

 

A)           Upon the written request of the Company, Holder agrees that, in the event of an Acquisition in which the sole consideration is cash and/or Marketable Securities, either (a) Holder shall exercise its conversion or purchase right under this Warrant and such exercise will be
deemed effective immediately prior to the consummation of such Acquisition or (b) if Holder elects not to exercise the Warrant, this Warrant will expire upon the consummation of such Acquisition. The Company shall provide the Holder with written notice of its request relating to the foregoing (together with such reasonable information as the Holder may request in connection with such contemplated Acquisition giving rise to such notice), which is to be delivered to Holder not less than ten (10) days prior to the
closing of the proposed Acquisition.

 

B)           Upon the closing of any Acquisition other than as particularly described in subsection (A) above, the successor entity shall assume the obligations of this Warrant, and this Warrant shall be exercisable for the same securities, cash, and property as would be payable for the
Shares issuable upon exercise of the unexercised portion of this Warrant as if such Shares were outstanding on the record date for the Acquisition and subsequent closing. The Warrant Price and/or number of Shares shall be adjusted accordingly.

 

 

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C)           As used in this Article 1.6, “Marketable Securities” means securities meeting all of the following requirements: (i) the issuer thereof is then subject to the reporting requirements of Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), and is then current in its filing of all required reports and other information under the Act and the Exchange Act; (ii) the class and series of shares or other security of the issuer that would be received by Holder in connection with the Acquisition were Holder to exercise or convert this Warrant on or prior to the closing thereof is then traded on a national securities exchange or over-the-counter market, and (iii) Holder would not be restricted by contract or by applicable
federal and state securities laws from publicly re-selling, within six (6) months and one day following the closing of such Acquisition, all of the issuer’s shares and/or other securities that would be received by Holder in such Acquisition were Holder to exercise or convert this Warrant in full on or prior to the closing of such Acquisition.

 

ARTICLE 2. ADJUSTMENTS TO THE SHARES.

2.1           Stock Dividends, Splits, Etc.  If the Company declares or pays a dividend on the outstanding shares of the Class payable in common stock or other securities, then upon exercise of this Warrant, for
each Share acquired, Holder shall receive, without cost to Holder, the total number and kind of securities to which Holder would have been entitled had Holder owned the Shares of record as of the date the dividend occurred.  If the Company subdivides the outstanding shares of the Class by reclassification or otherwise into a greater number of shares, the number of Shares purchasable hereunder shall be proportionately increased and the Warrant Price shall be proportionately decreased.  If the
outstanding shares of the Class are combined or consolidated, by reclassification or otherwise, into a lesser number of shares, the Warrant Price shall be proportionately increased and the number of Shares shall be proportionately decreased.

2.2           Reclassification, Exchange, Combinations or Substitution.  Upon any reclassification, exchange, substitution, or other event that results in a change
of the number and/or class of the securities issuable upon exercise or conversion of this Warrant, Holder shall be entitled to receive, upon exercise or conversion of this Warrant, the number and kind of securities and property that Holder would have received for the Shares if this Warrant had been exercised immediately before such reclassification, exchange, substitution, or other event.  The Company or its successor shall promptly issue to Holder a certificate pursuant to Article 2.6 hereof setting
forth the number, class and series or other designation of such new securities or other property issuable upon exercise or conversion of this Warrant as a result of such reclassification, exchange, substitution or other event.  The provisions of this Article 2.2 shall similarly apply to successive reclassifications, exchanges, substitutions, or other events.

 

2.3           [Intentionally Omitted].

2.4           No Impairment.  The Company shall not, by amendment of its Articles of Incorporation or through a reorganization, transfer of assets, consolidation,
merger, dissolution, issue, or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed under this Warrant by the Company, but shall at all times in good faith assist in carrying out of all the provisions of this Article 2 and in taking all such action as may be necessary or appropriate to protect Holder's rights under this Article against impairment.

 

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2.5           Fractional Shares.  No fractional Shares shall be issuable upon exercise or conversion of the Warrant and the number of Shares to be issued shall be
rounded down to the nearest whole Share.  If a fractional share interest arises upon any exercise or conversion of the Warrant, the Company shall eliminate such fractional share interest by paying Holder the amount computed by multiplying the fractional interest by the fair market value of a full Share.

2.6           Certificate as to Adjustments.  Upon each adjustment of the Warrant Price, Class and/or number of Shares, the Company shall promptly notify Holder in
writing, and, at the Company’s expense, promptly compute such adjustment, and furnish Holder with a certificate of its Chief Financial Officer setting forth such adjustment and the facts upon which such adjustment is based. The Company shall, upon written request, furnish Holder a certificate setting forth the Warrant Price, Class and number of Shares in effect upon the date thereof and the series of adjustments leading to such Warrant Price, Class and number of Shares.

ARTICLE 3. REPRESENTATIONS AND COVENANTS OF THE COMPANY.

3.1           Representations and Warranties.  The Company represents and warrants to, and agrees with, the Holder as follows:

(a)           The Company agrees that it will at all times reserve from its authorized and unissued capital stock a sufficient number of shares of common stock to provide for the issuance of Shares upon the exercise of this Warrant.  The
Company further agrees that all Shares will, upon issuance hereunder, be duly authorized, validly issued, fully paid and non-assessable, and will be free from all taxes, liens, encumbrances (except for restrictions on transfer provided for herein or under applicable securities laws) and charges in respect of the issue thereof.

 

3.2           Notice of Certain Events.  If the Company proposes at any time (a) to declare any dividend or distribution upon the outstanding shares of the Class,
whether in cash, property, stock, or other securities and whether or not a regular cash dividend; (b) to offer for subscription or sale pro rata to the holders of the outstanding shares of the Class any additional shares of any class or series of the Company's stock; (c) to effect any reclassification, reorganization or recapitalization of the outstanding shares of the Class; or (d) to effect an Acquisition or to liquidate, dissolve or wind up, then, in connection with each such event, the Company shall give
Holder notice thereof at the same time and in the same manner as the Company provides notice thereof to the holders of the outstanding shares of the Class.

 

3.3             [Intentionally Omitted].

     3.4                  No Shareholder Rights.  Except as provided in this Warrant, Holder will not
have any rights as a shareholder of the Company until the exercise of this Warrant.

 

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ARTICLE 4. REPRESENTATIONS, WARRANTIES OF THE HOLDER.  The Holder represents and warrants to the Company as follows:

4.1             Purchase for Own Account.  This Warrant and the securities to be acquired upon exercise of this Warrant by Holder will be acquired for
investment for Holder’s account, not as a nominee or agent, and not with a view to the public resale or distribution in violation of applicable federal and state securities laws.  Holder also represents that it has not been formed for the specific purpose of acquiring this Warrant or the Shares.

4.2             Disclosure of Information.  Holder has received or has had full access to all the information it considers necessary or appropriate to
make an informed investment decision with respect to the acquisition of this Warrant and its underlying securities.  Holder further has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the offering of this Warrant and its underlying securities and to obtain additional information (to the extent the Company possessed such information or could acquire it without unreasonable effort or expense) necessary to verify any information furnished to
Holder or to which Holder has access.

4.3             Investment Experience.  Holder understands that the purchase of this Warrant and its underlying securities involves substantial risk.  Holder
has experience as an investor in securities of companies in the development stage and acknowledges that Holder can bear the economic risk of such Holder’s investment in this Warrant and its underlying securities and has such knowledge and experience in financial or business matters that Holder is capable of evaluating the merits and risks of its investment in this Warrant and its underlying securities and/or has a preexisting personal or business relationship with the Company and certain of its officers,
directors or controlling persons of a nature and duration that enables Holder to be aware of the character, business acumen and financial circumstances of such persons.

4.4       Accredited Investor Status.  Holder is an “accredited investor” within the meaning of Regulation D promulgated under the Act.

4.5           The Act.  Holder understands that this Warrant and the Shares issuable upon exercise or conversion hereof have not been registered under the Act in reliance upon a specific exemption therefrom, which
exemption depends upon, among other things, the bona fide nature of the Holder’s investment intent as expressed herein.  Holder understands that this Warrant and the Shares issued upon any exercise or conversion hereof must be held indefinitely unless subsequently registered under the Act and qualified under applicable state securities laws, or unless exemption from such registration and qualification are otherwise available.

ARTICLE 5. MISCELLANEOUS.

5.1           Term:  This Warrant is exercisable in whole or in part at any time and from time to time on or before the Expiration Date.

5.2           Legends.                      This Warrant and the
Shares shall be imprinted with a legend in substantially the following form:

 

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THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”) OR THE SECURITIES LAWS OF ANY STATE AND, EXCEPT AND PURSUANT TO THE PROVISIONS OF ARTICLE 5 OF THAT CERTAIN WARRANT TO PURCHASE STOCK ISSUED BY THE COMPANY TO SILICON VALLEY BANK DATED AS OF MARCH
__, 2010, MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAW OR, IN THE OPINION OF LEGAL COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS EXEMPT FROM REGISTRATION.

5.3           Compliance with Securities Laws on Transfer.  This Warrant and the Shares issuable upon exercise of this Warrant may not be transferred or assigned
in whole or in part without compliance with applicable federal and state securities laws by the transferor and the transferee (including, without limitation, the delivery of investment representation letters and legal opinions reasonably satisfactory to the Company, as reasonably requested by the Company).  The Company shall not require Holder to provide an opinion of counsel if the transfer is to SVB Financial Group (Silicon Valley Bank’s parent company) or any other affiliate of Holder, provided
that any such transferee is an “accredited investor” as defined in Regulation D promulgated under the Act.

5.4    Transfer Procedure.  After receipt by Silicon Valley Bank (“Bank”) of the executed Warrant, Bank will transfer all of
this Warrant to SVB Financial Group, Holder's parent company.  Subject to the provisions of Article 5.3 and upon providing the Company with written notice, SVB Financial Group and any subsequent Holder may transfer all or part of this Warrant or the Shares issuable upon exercise of this Warrant to any transferee, provided, however, in connection with any such transfer, SVB Financial Group or any subsequent Holder will give the Company notice of the portion of the Warrant being transferred with the name,
address and taxpayer identification number of the transferee and Holder will surrender this Warrant to the Company for reissuance to the transferee(s) (and Holder if applicable).

5.5           Notices.  All notices and other communications from the Company to the Holder, or vice versa, shall be deemed delivered and effective when given personally
or mailed by first-class registered or certified mail, postage prepaid, at such address as may have been furnished to the Company or Holder, as the case may be (or on the first business day after transmission by facsimile), in writing by the Company or such holder from time to time.  All notices to Holder shall be addressed as follows until the Company receives notice of a change of address in connection with a transfer or otherwise:

 

 

6

 

 

	 	 SVB Financial Group
	 	 Attn:  Treasury Department
	 	 3003 Tasman Drive, HA 200
	 	 Santa Clara, CA 95054
	 	 Telephone:  408-654-7400
	 	 Facsimile:  408-496-2405

 

Notice to the Company shall be addressed as follows until Holder receives notice of a change in address:

  

 

	 	 Wireless Ronin Technologies, Inc.
	 	 Attn: Chief Financial Officer
	 	 5929 Baker Road, Suite 475
	 	 Minneapolis, MN 55345
	 	 Telephone: 952-564-3525
	 	 Facsimile: 952-974-7887

 

5.6           Waiver.  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.

5.7           Attorney’s Fees.  In the event of any dispute between the parties concerning the terms and provisions of this Warrant, the party prevailing in
such dispute shall be entitled to collect from the other party all reasonable costs incurred in such dispute, including reasonable attorneys’ fees.

5.8           Automatic Conversion upon Expiration.  In the event that, upon the Expiration Date, the fair market value of one Share (or other security issuable upon
the exercise hereof) as determined in accordance with Article 1.3 above is greater than the Warrant Price in effect on such date, then this Warrant shall automatically be deemed on and as of such date to be converted pursuant to Article 1.2 above as to all Shares (or such other securities) for which it shall not previously have been exercised or converted, and, following Holder’s written request therefor, the Company shall promptly deliver a certificate representing the Shares (or such other securities)
issued upon such conversion to Holder.

5.9           Counterparts.  This Warrant may be executed in counterparts, all of which together shall constitute one and the same agreement.

5.10           Governing Law.  This Warrant shall be governed by and construed in accordance with the laws of the State of California, without giving effect to its
principles regarding conflicts of law.

 

 

 

	
“COMPANY”

 

WIRELESS RONIN TECHNOLOGIES, INC.

 

 

By: /s/ Darin McAreavey

 

Name: Darin McAreavey

Title: CFO

 
	  

	
“HOLDER”

 

SILICON VALLEY BANK

 

 

By: /s/ Adam Glick

 

Name: Adam Glick

Title: Relationship Manager

 

 
	  

  

  

  

APPENDIX 1

NOTICE OF EXERCISE

1.           Holder elects to purchase ___________ shares of the Common/Series ______ Preferred [strike one] Stock of __________________ pursuant to the terms of the attached Warrant, and tenders payment of the purchase price of the shares
in full.

 

[or]

 

1.           Holder elects to convert the attached Warrant into Shares/cash [strike one] in the manner specified in the Warrant.  This conversion is exercised for _____________________ of the Shares covered by the Warrant.

 

[Strike paragraph that does not apply.]

 

2.           Please issue a certificate or certificates representing the Shares in the name specified below:

___________________________________________

Holders Name

___________________________________________

___________________________________________

(Address)

        3.           By its execution below and for the benefit of the Company, Holder hereby restates each of the representations and warranties in Article 4 of the Warrant as of the date hereof.

 

HOLDER:

_________________________

By:_________________________

Name:________________________

Title:_________________________

(Date):_______________________

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