Document:

Filed by Bowne Pure Compliance

 

Exhibit 4.1

OPERATING LOAN AND SECURITY AGREEMENT

This OPERATING LOAN AGREEMENT, dated as of April 14, 2008 (this “Agreement”), is entered
into by and between SMART MOVE, INC., a Delaware corporation (the “Company”), and Thomas P.
Grainger, an individual residing in the state of Wyoming (“Lender”).

In consideration of the mutual terms, conditions and covenants, hereinafter set forth, the Company
and the Lender agree as follows:

	1	 	Subject to and in accordance with the terms and conditions of this Agreement Lender will make
loans to the Company (the “Loans”), up to an aggregate amount of $750,000 to be funded in
increments of $250,000 during the time periods specified below:

$250,000 to be advanced during the week ended April 18, 2008;

$250,000 to be advanced during the week ended May 2, 2008;

$250,000 to be advanced during the week ended May 30, 2008,

provided in respect of each such advance that no Event of Default has occurred as of the
date specified for the advance that is continuing on such date and no event has occurred
which, with notice or passage of time or both, would constitute an Event of Default.

	2	 	Security Interest. As security for the indebtedness, liabilities, and other obligations of
the Company to Lender hereunder, the Company hereby grants a security interest in favor of
Lender in and to the following specific equipment:

Five hundred (500) existing proprietary shipping containers (“Smart
VaultsTM”) used to transport household goods and other goods, and
manufactured by Orbis Corporation (“Collateral”).

The Lender and the Company have discussed the Company’s concurrent negotiations with
commercial financiers to procure a suitable facility or combination of facilities which may
include secured commercial loans or equipment leases structured as sale leaseback
transactions for purposes of which the Lender has agreed to release or quit claim all
interest of Lender as a secured party in the above equipment provided the Company either
substitutes collateral of comparable value reasonably acceptable to Lender or issues
additional common stock purchase warrants to Lender as described in Section 3.2 below.

 

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	3	 	ISSUANCE AND SALE OF NOTES AND WARRANTS.

	 
	3.1	 	The Notes. The Company has duly authorized and, subject to the provisions of Section
3.3 hereof, will issue to the Lender at each Closing as hereinafter defined, as evidence of
the loans to be made pursuant to this Agreement three secured convertible notes, each in the
principal sum of $250,000, and with principal and any accrued, unpaid interest to be
due thirty-six (36) months after the date of issuance, being the date of advance of funds by
the Lender under each respective note, and convertible at the Lender’s election into shares
of the Company’s common stock, par value $0.0001, at a fixed conversion price of $0.40 per
share (collectively called the “Notes” and each individually a “Note”). The Notes will be
issued in the basic form attached as Exhibit “A” and will bear interest at the rate of 12%
per annum from date of advance of funds thereunder, which interest shall be payable
quarterly in arrears on the first day of each calendar quarter commencing July 1, 2008. The
interest may, in the Company’s discretion be paid either in cash or by the issuance of a
number of restricted shares of the Company’s common stock, par value $0.0001, corresponding
to an aggregate market value of shares that is 110% of the amount of interest otherwise
payable in cash. The market value of such shares shall be established by the five day
average closing price for a share of the common stock of the Company through and including
the five trading days immediately preceding the date on which the payment is due. The
Company hereby agrees and the Notes will reflect that the Company’s issuance of any new
securities to parties other than Lender or Professional Offshore Opportunity Fund, Ltd. (and
its co-investors under January 2008 debentures) convertible into shares of its common stock,
$0.0001 par value, at a conversion price which is below $0.32 per share (adjusted to reflect
any stock splits or recapitalization transactions) will constitute an Event of Default,
after which the Lender may by issuance of written notice sent via certified mail, return
receipt requested, elect to declare the full amount of principal and interest owing on the
Notes to be in default, unless the Company agrees to adjust the conversion price applicable
under the terms of the Notes and/or agree upon other modifications to the Notes acceptable
to Lender as an adjustment to equalize the conversion price terms hereof with those of the
subsequently issued securities. Notwithstanding the foregoing conversion price terms (or the
exercise price terms of the warrants described in 3.2 below), in the event that Lender fails
to provide the total agreed funding aggregating $750,000, any Note issued hereunder shall
automatically and without further action by either party be deemed amended to substitute a
fixed conversion price of $0.75 per share, and any warrant attached to such Note as
described below in 3.2 will automatically be deemed amended to substitute a fixed exercise
price of $1.00 per share.

	 
	3.2	 	The Warrants. The Company has duly authorized and will issue to the Lender
concurrently with each incremental closing (being the date of advance of funds under each
separate Note) common stock purchase warrants aggregating 625,000 shares each, at an exercise
price of $0.80 per share. Additionally, the Company has authorized and agreed to issue
conditionally to the Lender a common stock purchase warrant to acquire an aggregate 1,875,000
shares at an exercise price of $1.00, in the event that, but only in the event that: (i)
Lender has fulfilled its commitment to advance an aggregate $750,000, and (ii) the Company has
requested and Lender has concurrently released pursuant to the Company’s request, Lender’s
Collateral pledged hereunder to secure the loans evidenced by the Notes as an accommodation
for purposes described in Section 2 above. In the event that such conditional warrant is
required to be issued, it shall be dated on the date Lender effectively releases Lender’s
security interest in the Collateral and will be exercisable in whole or in part at any time
and from time to time during the period commencing on the date of issuance thereof and ending
on the fifth (5th) consecutive
anniversary of the Closing Date. The form of warrant to be issued concurrently with each
Note is attached in the form of Exhibit “B”, and the form of warrant conditionally issuable
if the Company is unable or declines to substitute collateral is attached as Exhibit “C”.

 

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	3.3	 	Lender acknowledges that the Company has listed its common stock on the American Stock
Exchange and understands that the issuance of the shares underlying the Notes and warrants to
purchase securities hereunder is subject to the prior approval of the American Stock Exchange
of such listing and any approval requirements by the shareholders of the Company which the
American Stock Exchange may require. The Company agrees to use commercially reasonable
efforts to secure any and all required approvals of shareholders but shall not be deemed in
default or breach if and to the extent such shareholder approval is withheld or deferred or
required to be re-submitted to shareholders for approval at a later date.

	 
	4	 	PURCHASE AND SALE OF SECURITIES

	 
	4.1	 	Closings. On and subject to the terms and conditions of this Agreement, the Lender
hereby agrees to sell and issue on or about the date specified in Section 1 above, the
applicable Note dated as of the date of advance of funds by Lender to evidence the incremental
amount then advanced pursuant to each respective Note, each such funding date being referred
to herein as a “Closing”.

	 
	4.2	 	Deliveries at Closings. At each Closing, the Company will deliver to the Lender: 1)
the applicable Note due thirty-six (36) months after date as described in Section 3.1 above in
exchange for Lender’s cash advance in good and sufficient funds, and 2) the five year purchase
warrant attached to the respective Note having an exercise price of $0.80 per share and 3) at
the third and final Closing, provided that Lender has advanced an aggregate $750,000, the form
of warrant attached as Exhibit “C” covering an aggregate 1,875,000 shares at an exercise price
of $1.00, such delivery and issuance to remain subject to the requirements of the American
Stock Exchange for actual issuance of the underlying shares upon conversion or exercise of
debentures and options, including the obtaining of any approval of shareholders that may
subsequently be determined to be required.

	 
	5	 	REPRESENTATIONS AND WARRANTIES OF THE COMPANY

	 
	 	 	The Company represents and warrants to the Lender as follows:

	 
	5.1	 	Organization, etc. The Company has been duly formed, and is validly existing as a
corporation in good standing under the laws of Delaware and is qualified to do business as a
foreign corporation in each jurisdiction in which the failure to be so qualified could
reasonably be expected to have a material adverse effect on the assets, liabilities, condition
(financial or other), business or results of operations of the Company taken as a whole (a
“Material Adverse Effect”). The Company has the requisite corporate power and authority to
own, lease and operate its properties and to conduct its businesses as
presently conducted. The Company has the requisite corporate power and authority to enter
into, execute, deliver and perform all of its duties and obligations under this Agreement
and to consummate the transactions contemplated hereby.

 

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	5.2	 	Authorization. The execution, delivery and performance of this Agreement and the
issuance of the Securities shall have been duly authorized by all necessary corporate action
on the part of the Company, including, without limitation, the due authorization by the
affirmative votes of a majority of the disinterested directors of the Company’s Board of
Directors on the date on which this Agreement is signed.

	 
	5.3	 	Validity; Enforceability. This Agreement and the Notes and warrants shall at the
applicable Closing have each been duly executed and delivered by the Company, and constitute
the legal, valid and binding obligation of the Company, enforceable against the Company in
accordance with their respective terms, except as such enforceability or the effectiveness of
any term or provision may be limited by, or subject to, any bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights
generally and subject to general principles of equity.

	 
	5.4	 	Capitalization. As of the date hereof, the authorized capital stock of the Company
consists of the Company consists of 100,000,000 shares of Common Stock, $0.0001 par value.
The Company will at all times reserve a sufficient number of shares of its Common Stock for
future issuance upon the exercise or conversion of the Securities covered by this Agreement
and all other agreements and instruments convertible into or exercisable to acquire Common
Stock.

	 
	5.5	 	Governmental and Stock Exchange Approvals and Consents. The execution and delivery by
the Company of this Agreement, and the performance by the Company of the transactions
contemplated hereby, do not and will not require the Company to effectuate or obtain any
registration with, consent or approval of, or notice to any federal, state or other
governmental authority or regulatory body, other than: i) periodic and other filings under the
Securities Exchange Act of 1934, as amended (the “Exchange Act”); and ii) approval of a
listing application and/or notifications to the American Stock Exchange with respect to the
issuance of the Common Stock issuable upon conversion or exercise of the notes and exercise of
the warrants comprising the Securities. The parties hereto agree and acknowledge that, in
making the representations and warranties in the foregoing sentence of this Section 5.5, the
Company is relying on the representations and warranties made by the Lender in Section 6. To
the best knowledge of the Company, the issuance and sale of the Securities will not
contravene the rules and regulations of the American Stock Exchange, whose rules and
regulations require under certain circumstances that a listed company obtain shareholder
approval in connection with a transaction (other than a public offering), involving the
potential issuance of shares of common stock (including shares of common stock issuable upon
the conversion or exercise of other securities) equal to 20% or more of its aggregate shares
of common stock, or its aggregate voting power, outstanding before the transaction for less
than the greater of book or market value of its common stock as of the date of the
transaction. Based upon the new investment and fixed exercise prices applicable with respect
to all
securities that will be acquired by the Lender hereunder, the Company believes that no
specific approval requirement of the shareholders of the Company will be applicable to the
issuance and delivery of the Securities covered hereby, but reserves the right to seek any
such approval the Company’s Board of Directors deems appropriate or which may be requested
by the American Stock Exchange as a condition of its listing of the underlying shares
issuable with respect to the Securities covered by this Agreement.

 

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	5.6	 	No Violation. The execution and delivery of this Agreement and the performance by the
Company of the transactions contemplated hereby will not (i) conflict with or result in a
breach of any provision of the articles of incorporation or by-laws of the Company, (ii)
result in a default or breach of, or require any consent, approval, authorization or permit
of, or filing or notification to, any person, company or entity under any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, loan, factoring arrangement,
license, agreement, lease or other instrument or obligation to which the Company is a party or
by which the Company or its assets may be bound or (iii) violate any law, judgment, order,
writ, injunction, decree, statute, rule or regulation of any court, administrative agency,
bureau, board, commission, office, authority, department or other governmental entity
applicable to the Company or its subsidiaries, except, in the case of clause (ii) or (iii)
above, any such event that could not reasonably be expected to have a Material Adverse Effect
or materially impair the transactions contemplated hereby.

	 
	5.7	 	Issuances of Securities. The Securities to be delivered at the Closing shall be
validly issued, and, upon payment therefore, will be fully paid and non-assessable. The
offering, issuance, sale and delivery of the Securities as contemplated by this Agreement are
exempt from the registration and prospectus delivery requirements of the Securities Act of
1933, as amended (the “Securities Act”), are being made in compliance with all applicable
federal and (except for any violation or non-compliance that could not reasonably be expected
to have a Material Adverse Effect) state laws and regulations concerning the offer, issuance
and sale of securities, and are not being issued in violation of any preemptive or other
rights of any stockholder of the Company. The parties hereto agree and acknowledge that, in
making the representations and warranties in the foregoing sentence of this Section 5.7, the
Company is relying on the representations and warranties made by the Lender in Section 6.

	 
	5.8	 	Absence of Certain Developments. Since December 31, 2007, except as disclosed in the
Company’s periodic and current reports and other public filings with the SEC under the
Securities Exchange Act of 1934, there has not been any: (i) material adverse change in the
condition, financial or otherwise, of the Company (taken as a whole) or in the assets,
liabilities, properties or business of the Company and its Subsidiary (taken as a whole); (ii)
declaration, setting aside or payment of any dividend or other distribution with respect to,
or any direct or indirect redemption or acquisition of, any capital stock of the Company;
(iii) waiver of any valuable right of the Company or its Subsidiary or cancellation of any
material debt or claim held by the Company or its Subsidiary; (iv) material loss, destruction
or damage to any property of the Company or its Subsidiary, whether or not insured; (v)
acquisition or disposition of any material assets (or any contract or arrangement therefore)
or any other material transaction by the Company or
its Subsidiary otherwise than for fair value in the ordinary course of business consistent
with past practice; or (vi) other agreement or understanding, whether in writing or
otherwise, for the Company or its Subsidiary to take any action of the type, or any action
that would result in an event of the type, specified in clauses (i) through (v).

 

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	5.9	 	Commission Filings. The Company has filed all required forms, reports and other
documents with the Securities and Exchange Commission (the “Commission”) for periods from and
after the completion of its initial public offering in December 2006 (collectively, the
Commission Filings”), each of which has complied in all material respects with all applicable
requirements of the Securities Act and/or the Exchange Act (as applicable). The Company has
heretofore made accessible to the Lender all of the Commission Filings.

	 
	5.10	 	Brokers. The Company has employed the brokerage firm of JP Turner & Company, L.L.C.,
a member of the National Association of Securities Dealers with respect to this transaction,
and has agreed to pay the Broker a cash fee equal to 8% of gross invested capital received by
the company.

	 
	6	 	REPRESENTATIONS AND WARRANTIES OF THE LENDER

	 
	 	 	The Lender represents and warrants to the Company as follows:

	 
	6.1	 	Validity; Enforceability. This Agreement has been duly executed and delivered by the
Lender, and constitutes the legal, valid and binding obligation of the Lender, enforceable
against the Lender in accordance with its terms, except as such enforceability may be limited
by, or subject to, any bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors’ rights generally and subject to general principles of
equity.

	 
	6.2	 	Investment Representations. The Lender understands that the Securities are being
offered and sold pursuant to an exemption from registration pursuant to Federal Rule 506 of
Regulation D under the Securities Act of 1933 and are based in part upon Lender’s
representations contained in this Agreement, including, without limitation, that the Lender is
an “accredited investor” within the meaning of Regulation D under the Securities Act as stated
in 6.7 below. Lender confirms that Lender has received or has had full access to all the
information Lender considers necessary or appropriate to make an informed investment decision
with respect to the Securities to be purchased by it under this Agreement and the common stock
acquired by Lender upon the conversion of the convertible notes and exercise of the warrants,
respectively. Lender further confirms that Lender has had an opportunity to ask questions and
receive answers from the Company regarding the Company’s business, management and financial
affairs and the terms and conditions of the sale of the 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 the Lender or
to which the Lender had access. No oral or written representations have been made or oral or
written information furnished to the Lender or the Lender’s advisors in connection with the
Securities that were in any way inconsistent with this Agreement. The Lender is not
purchasing the securities as a result of or subsequent to: (1) any advertisement, article,
notice or other communication published in any newspaper, magazine or similar media or
broadcast over television, radio or the internet or (2) any seminar or meeting whose
attendees have been invited by any general solicitation or general advertising.

 

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	6.3	 	Lender Understands Economic Risks. Lender acknowledges that Lender can bear the
economic risk and complete loss of Lender’s investment in the Securities. Lender has
substantial experience in evaluating and investing in private placement transactions of
securities in companies similar to the Company so that it Lender is capable of evaluating the
merits and risks of its investment in the Company and has the capacity to protect his own
interests. Lender understands that Lender must bear the economic risk of this investment until
the Securities are sold pursuant to: (i) an effective registration statement under the
Securities Act; or (ii) an exemption from registration is available with respect to such sale.

	 
	6.4	 	Lender’s Awareness of Specific Risks Relating to the Company’s Business. The Lender
has been given the opportunity to review the merits and risks of the investment provided for
in this Agreement with legal counsel and with an investment advisor to the extent the Lender
deemed advisable. Lender acknowledges that Lender has been advised by the Company carefully to
consider the risks and uncertainties described in the Company’s periodic and reports filed
with the SEC before executing this Agreement. In particular, the Company had advised Lender
that the Company anticipates that significant additional equity or debt funding may be
required in addition to Lender’s investment not only to expand the Company’s operations, but
also to sustain its operations and satisfy its contractual obligations until the Company
achieves profitability. There can be no assurance that the Company will achieve cash flow from
operations sufficient to satisfy its working capital requirements, or at all, or that the
additional financing the Company may require will be available to the Company on commercially
reasonable terms, or at all.

	 
	6.5	 	Acquisition For Own Account. The Lender is acquiring the Securities for the Lender’s
own account for investment only, and not as a nominee or agent and not with a view towards or
for resale in connection with their distribution.

	 
	6.6	 	Lender Can Protect His Interest. and has such knowledge and experience in financial
or business matters that

	 
	6.7	 	Accredited Investor. The Lender represents and warrants to the Company that Lender is
an accredited investor within the meaning of Regulation D under the Securities Act because
Lender comes within one of the categories of investors as defined in the certification
attached as Exhibit “D” hereto and herby confirms that Lender has provided a separate signed
copy of the certification to J.P Turner, LLC, on which Lender has also signed his name next to
the appropriate category(ies) in which Lender is included.

 

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	6.8	 	Legends.

	 	6.8.1	 	The Convertible Note shall bear substantially the following legend:

“THIS NOTE AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS NOTE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE, STATE SECURITIES
LAWS. THIS NOTE AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS NOTE MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT AS TO THIS NOTE OR SUCH SHARES UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAWS
OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO SMART MOVE, INC. THAT SUCH REGISTRATION
IS NOT REQUIRED.”

	 	6.8.2	 	The shares issued upon conversion of the unsecured convertible notes shall
bear a legend which shall be in substantially the following form until such shares are
covered by an effective registration statement filed with the SEC:

“THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS. THESE SHARES MAY NOT BE
SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT UNDER SUCH SECURITIES ACT AND APPLICABLE STATE LAWS OR AN OPINION OF COUNSEL
REASONABLY SATISFACTORY TO SMART MOVE, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.”

	 	6.8.3	 	The Warrants shall bear substantially the following legend:

“THIS WARRANT AND THE COMMON SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES
LAWS. THIS WARRANT AND THE COMMON 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 AS TO THIS WARRANT OR THE UNDERLYING SHARES OF COMMON STOCK UNDER SAID ACT AND
APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO SMART
MOVE, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.”

	6.9	 	Filings Required to Update Lender’s Schedule 13G. The Company and the Lender
acknowledge that the Lender has filed and will be required to amend and supplement a
Schedule 13G to reflect the additional securities and amendments effected upon the Closing
contemplated by this Agreement.

 

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	6.10	 	Covenants of the Company. The Company covenants and agrees with the Lender that, so
long as the Notes or any of them remain outstanding:

	 	6.10.1	 	STOP ORDERS. The Company will advise the Lender, promptly after it receives notice of
issuance by the Securities and Exchange Commission (the “SEC”), any state securities
commission or any other regulatory authority of any stop order or of any order
preventing or suspending any offering of any securities of the Company, or of the
suspension of the qualification of the Common Stock of the Company for offering or sale
in any jurisdiction, or the initiation of any proceeding for any such purpose.

	 
	 	6.10.2	 	MARKET REGULATIONS. The Company shall notify the SEC, American Stock Exchange and
applicable state authorities, in accordance with their requirements, to the extent
applicable to the Company, of the transactions contemplated by this Agreement, and
shall take all other necessary action and proceedings as may be required and permitted
by applicable law, rule and regulation, for the legal and valid issuance of the
Securities to the Lender and promptly provide copies thereof to the Lender.

	 
	 	6.10.3	 	REPORTING REQUIREMENTS. The Company will timely file with the SEC all reports
required to be filed pursuant to the Exchange Act and refrain from terminating its
status as an issuer required by the Exchange Act to file reports thereunder even if the
Exchange Act or the rules or regulations thereunder would permit such termination.

	 
	 	6.10.4	 	USE OF FUNDS. The Company agrees that it will use the proceeds of the sale of the
Convertible Notes and the Warrants for general working capital and general business
purposes of the Company and its subsidiaries.

	 
	 	6.10.5	 	ACCESS TO FACILITIES. Each of the Company and each of his Subsidiaries will permit
any representatives designated by the Lender (or any successor of the Lender), upon
reasonable notice and during normal business hours, at such person’s expense and
accompanied by a representative of the Company, to:

	 	6.10.5.1	 	visit and inspect any of the properties of the Company or any of its
Subsidiaries;

	 
	 	6.10.5.2	 	examine the corporate and financial records of the Company or any of its
Subsidiaries (unless such examination is not permitted by federal, state or
local law or by contract) and make copies thereof or extracts there from; and

	 
	 	6.10.5.3	 	discuss the affairs, finances and accounts of the Company or any of its
Subsidiaries with the directors, officers and independent accountants of the
Company or any of its subsidiaries.

 

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Notwithstanding the foregoing, neither the Company nor any of its subsidiaries will provide
any material, non-public information to the Lender unless the Lender signs a confidentiality
agreement and otherwise complies with Regulation FD, under the federal securities laws.

	6.11	 	Taxes. Each of the Company and each of its Subsidiaries will promptly pay and
discharge, or cause to be paid and discharged, when due and payable, all lawful taxes,
assessments and governmental charges or levies imposed upon the income, profits, property or
business of the Company and its Subsidiaries; provided, however, that any such tax,
assessment, charge or levy need not be paid if the validity thereof shall currently be
contested in good faith by appropriate proceedings and if the Company and/or such Subsidiary
shall have set aside on its books adequate reserves with respect thereto, and provided,
further, that the Company and its Subsidiaries will pay all such taxes, assessments, charges
or levies forthwith upon the commencement of proceedings to foreclose any lien which may have
attached as security therefore.

	6.12	 	Insurance. Each of the Company and its Subsidiaries will keep its assets which are of
an insurable character insured by financially sound and reputable insurers against loss or
damage by fire, explosion and other risks customarily insured against by companies in similar
business similarly situated as the Company and its Subsidiaries; and the Company and its
Subsidiaries will maintain, with financially sound and reputable insurers, insurance against
other hazards and risks and liability to persons and property to the extent and in the manner
which the Company reasonably believes is customary for companies in similar business similarly
situated as the Company and its Subsidiaries and to the extent available on commercially
reasonable terms.

	6.13	 	Rule 144 Sales. The Company agrees to cooperate with the Lender in connection with
any resales made pursuant and subject to the applicable requirements of Rule 144 and provide
legal opinions necessary to allow such resales provided the Company and its counsel receive
reasonably requested representations and documentation from the selling Lender and broker, if
any.

	6.14	 	Covenants of the Lender. The Lender, and each of them, covenant and agree with the
Company as follows:

	 	6.14.1	 	CONFIDENTIALITY. The Lender, agrees that Lender will not disclose, and will not
include in any public announcement, the name of the Company, unless expressly agreed to
by the Company or unless and until such disclosure is required by law or applicable
regulation, and then only to the extent of such requirement.

	 
	 	6.14.2	 	NON-PUBLIC INFORMATION. The Lender agrees not to effect any sales in the shares of
the Company’s Common Stock while in possession of material, non-public information
regarding the Company if such sales would violate applicable securities law.

 

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	6.15	 	Covenants of the Company and Lender Regarding Indemnification.

	 	6.15.1	 	COMPANY INDEMNIFICATION. The Company agrees to indemnify, hold harmless, reimburse
and defend Lender against any claim, cost, expense, liability, obligation, loss or
damage (including reasonable legal fees) of any nature, incurred by or imposed upon the
Lender which results, arises out of or is based upon a third party claim attributable
to: (i) any misrepresentation by the Company in this Agreement, any other schedules
attached hereto or thereto; or (ii) any breach or default in performance by Company of
any covenant or undertaking to be performed by the Company hereunder.

	 
	 	6.15.2	 	LENDER’S INDEMNIFICATION. Lender agrees to indemnify, hold harmless, reimburse and
defend the Company and each of the Company’s officers, directors, agents, affiliates,
control persons and principal shareholders, at all times against any claim, cost,
expense, liability, obligation, loss or damage (including reasonable legal fees) of any
nature, incurred by or imposed upon the Company which results, arises out of or is
based upon: (i) any misrepresentation by Lender or breach of any warranty by Lender in
this Agreement or any Related Agreement or in any exhibits or schedules attached
hereto; or (ii) any breach or default in performance by Lender of any covenant or
undertaking to be performed by Lender hereunder, under any Related Agreement or any
other agreement entered into by the Company and Lender relating hereto or thereto.

	7	 	MISCELLANEOUS

	7.1	 	Governing Law. This agreement and the other related agreements shall be governed by
and construed and enforced in accordance with the laws of the state of Colorado applicable to
contracts made and performed in such state, without regard to principles of conflicts of laws.

	7.2	 	Disputes. The parties desire that their disputes be resolved by a judge applying
such applicable laws. Therefore, to achieve the best combination of the benefits of the
judicial system and of arbitration, the parties hereto waive all rights to trial by jury in
any action, suit, or proceeding brought to resolve any dispute, whether arising in contract,
tort, or otherwise between the Lender and/or the company arising out of, connected with,
related or incidental to the relationship established between them in connection with this
agreement, any other related agreement or the transactions related hereto or thereto.

	7.3	 	Successors. Except as otherwise expressly provided herein, the provisions hereof
shall inure to the benefit of, and be binding upon, the successors, heirs, executors and
administrators of the parties hereto and shall inure to the benefit of and be enforceable by
each person who shall be a holder of the Securities from time to time, other than the holders
of Common Stock which has been sold by the Lender pursuant to Rule 144 or an effective
registration statement. No Lender shall be permitted to assign its rights hereunder or under
any Related Agreement to a competitor of the Company.

 

11

 

	 	7.4	 	Entire Agreement. This Agreement, the Related Agreements, the exhibits and schedules
hereto and thereto and the other documents delivered pursuant hereto constitute the full and
entire understanding and agreement between the parties with regard to the subjects hereof and
no party shall be liable or bound to any other in any manner by any representations,
warranties, covenants and agreements except as specifically set forth herein and therein.

	 
	 	7.5	 	Severability. In case any provision of the Agreement shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.

	 
	 	7.6	 	Amendment and Waiver.

	 
	 	7.6.1	 	This Agreement may be amended or modified only upon the written consent of the Company and
the Lender.

	 
	 	7.6.2	 	The obligations of the Company and the rights of the Lender under this Agreement may be
waived only with the written consent of the Lender.

	 
	 	7.6.3	 	The obligations of the Lender and the rights of the Company under this Agreement may be
waived only with the written consent of the Company.

	 
	 	7.7	 	Notices. All notices required or permitted hereunder shall be in writing and shall
be deemed effectively given:

	 
	 	7.7.1	 	upon personal delivery to the party to be notified;

	 
	 	7.7.2	 	when sent by confirmed facsimile if sent during normal business hours of the recipient, if
not, then on the next business day;

	 
	 	7.7.3	 	three (3) business days after having been sent by registered or certified mail, return
receipt requested, postage prepaid; or

	 
	 	7.7.4	 	one (1) day after deposit with a nationally recognized overnight
 _____ 
courier, specifying
next day delivery, with written verification of receipt.

	 
	 	 	 	All communications shall be sent as follows:

	 	 	 
	IF TO THE COMPANY, TO:

	 	SMART MOVE, INC.
	 

	 	5990 Greenwood Plaza Blvd, Suite 390
	 

	 	Greenwood Village, Colorado 80111
	 

	 	Attention: Chief Executive Officer
	 

	 	Facsimile: 720-488-0199
	 
	 	 
	IF TO THE LENDER, TO:

	 	Thomas P. Grainger
	 

	 	Post Office Box 7
	 

	 	Saratoga, WY 82231
	 

	 	Or courier;
	 

	 	Highway 130
	 

	 	4 Miles South of Saratoga

or at such other address as the Company or the Lender may designate by written notice to the
other party hereto given in accordance herewith.

 

12

 

	7.8	 	Titles and Subtitles. The titles of the sections and subsections of this Agreement
are for convenience of reference only and are not to be considered in construing this
Agreement.

	7.9	 	Facsimile Signatures; Counterparts. This Agreement may be executed by facsimile
signatures and in any number of counterparts, each of which shall be an original, but all of
which together shall constitute one instrument.

	7.10	 	Broker’s Fees. Each party hereto represents and warrants that JP Turner is the broker
for this transaction and that no other agent, broker, investment banker, person or firm acting
on behalf of or under the authority of such party hereto is or will be entitled to any
broker’s or finder’s fee or any other commission directly or indirectly in connection with the
transactions contemplated herein.

IN WITNESS WHEREOF, the parties hereto have executed the OPERATING LOAN AND SECURITY AGREEMENT
as of the date set forth in the first paragraph hereof.

	 	 	 	 	 
	 	COMPANY:

SMART MOVE, INC.

 	 
	 	By:  	/s/ Chris Sapyta
 	 
	 	 	Name:  	Chris Sapyta 	 
	 	 	Title:  	Chief Executive Officer 	 
	 
	 	LENDER:

Thomas P. Grainger

 	 
	 	By:  	/s/ Thomas P. Grainger
 	 
	 	 	Name:  	Thomas P. Grainger 	 
	 	 	Title:  	Individually 	 
	 

			
	Address:	 	Post Office Box 7

Saratoga, WY 82231

 

13

 

EXHIBIT “A”

THIS NOTE HAS BEEN MADE FOR INVESTMENT PURPOSES ONLY AND NOT WITH A VIEW TO OR FOR SALE IN
CONNECTION WITH THE DISTRIBUTION THEREOF AND HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “ACT”). THIS NOTE MAY NOT BE SOLD, TRANSFERRED, OR ASSIGNED (“TRANSFER”)
UNLESS IT IS SUBSEQUENTLY REGISTERED OR AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE AND THE
MAKER CONSENTS IN WRITING TO SUCH TRANSFER. THE COMMON STOCK ISSUABLE UPON CONVERSION HEREOF HAS
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED
OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL IN FORM, SUBSTANCE AND SCOPE
REASONABLY ACCEPTABLE TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR UNLESS
SOLD PURSUANT TO RULE 144 UNDER SAID ACT. ANY SUCH SALE, ASSIGNMENT OR TRANSFER MUST ALSO BE MADE
IN COMPLIANCE WITH APPLICABLE STATE SECURITIES LAWS.

			
	 	 	 
	April [May], 2008
	 	$250,000

SMART MOVE, INC.

12% Secured Convertible Note (“Note”)

Due April [May]
 _____ 
, 2011

Smart Move, Inc., a Delaware corporation (“Maker” or the “Company”), for value received,
promises to pay to the order of Thomas P. Grainger, an individual residing in the State of Wyoming
whose address is Post Office Box 7 Saratoga, WY 82331 (the “Holder”), the principal sum of Two
Hundred Fifty Thousand ($250,000) Dollars with an annualized rate of interest from the date hereof
of twelve percent (12%) per annum until maturity. Interest shall be due and payable quarterly in
arrears on the first day of July, October, January and April of each year and at the Maturity Date
or upon any prepayment or acceleration of the maturity of this Note. Such interest payments shall
be made in cash or, subject to the Company’s right in its sole discretion with respect to all
interest that accrues and becomes payable during the initial twelve (12) months after the date of
this Note, to pay such interest by means of the issuance of a number of shares of restricted common
stock, par value $0.0001, of the Company to the Holder corresponding to an aggregate market value
that is 110% of the amount of interest otherwise payable in cash. The market value of such shares
shall be established by the five day average closing price for a share of the common stock of the
Company through and including the five trading days immediately prior to the date on which the
quarterly interest payment is due. Maker may at any time or from time to time, upon giving Holder
at least thirty (30) days advance written notice of Maker’s intention to do so, make a voluntary
prepayment, whether in full or in part, of this Note, without premium or penalty.

 

14

 

	1.	 	NOTE

This Note in the principal amount of Two Hundred Fifty Thousand ($250,000) Dollars is being
issued to evidence indebtedness of the Company to the Holder pursuant and subject to the terms and
conditions of that certain Operating Loan and Security Agreement dated April
 _____ 
, 2008. This Note
is secured by a security interest granted to the Holder in and to the following specific equipment:

Five hundred (500) existing proprietary shipping containers (“Smart
VaultsTM”) used to transport household goods and other goods, and
manufactured by Orbis Corporation (“Collateral”).

	2.	 	CONVERSION AT OPTION OF HOLDER; AUTOMATIC CONVERSION

	 	A.	 	Conversion at Option of Holder. The Holder shall have the right (the
“Conversion Right”) at any time or from time to time prior to the day this Note is paid
in full, to convert all or any part of the outstanding and unpaid principal amount of
this Note as shall remain unpaid at the effective date of the conversion, into, fully
paid and non-assessable shares of Common Stock, par value $.0001 per share, at a
conversion price of $0.40 per share (the “Conversion Price”). The Conversion Right may
be exercised notwithstanding Maker’s issuance of a notice of intention to make a
voluntary prepayment, and the effective date of an elective conversion is the date of
Holder’s delivery of a “Conversion Notice” in the form attached hereto.

	 
	 	B.	 	Automatic Conversion. The Note will automatically convert into shares of the
Company’s common stock on the date when closing bid price of a share of the Company’s
common stock equals $3.75 per share or greater for twenty (20) of thirty (30)
consecutive trading days on the American Stock Exchange, provided that the underlying
 shares have either been registered for resale by the holders of the securities or are
eligible to be sold under and subject to Rule 144 under the Securities Act of 1933.

	 
	 	C.	 	Mechanics of Conversion. The Holder shall effect any elective conversions by
delivering to the Company a completed notice in the form attached hereto as Exhibit “A”
(a “Conversion Notice”). Unless the Holder is converting the entire principal amount
outstanding under this Note or an Automatic Conversion has occurred, the Holder is not
required to physically surrender this Note to the Company in order to effect
conversions. Conversions hereunder shall have the effect of lowering the outstanding
principal amount of this Note plus any accrued and unpaid interest thereon paid in
equity securities in an amount equal to the applicable conversion. The Company shall
maintain records showing the principal amount converted and the date of such
conversions and will promptly notify Holder if an Automatic Conversion occurs. Upon
conversion of the entire unpaid principal amount of this Note and any accrued, unpaid
interest, whether in connection with a conversion at the option of Holder pursuant to
exercise of the
Conversion Right or pursuant to an Automatic Conversion, this Note shall be
surrendered by the Holder to the Company for cancellation and a certificate
representing the Common Stock issued to Holder therefor shall be delivered to
Holder. No fractional shares or scrip shall be issued upon any conversion of this
Note. Instead of any fractional shares that would otherwise be issuable upon
conversion of this Note, the Company shall pay a cash adjustment in respect of such
fractional interest in an amount equal to that fractional interest of the Conversion
Price at which the Note was converted.

 

15

 

	3.	 	RESERVATION OF AUTHORIZED SHARES; EFFECT OF RECAPITALIZATION

	 	A.	 	Reservation of Authorized Shares. The Company agrees and represents that
until this Note is paid in full or converted, the Company will reserve from its
authorized and unissued Common Stock a sufficient number of shares to provide for the
issuance of Common Stock upon the full conversion of this Note. The Company further
agrees and represents that upon issuance, such shares will be duly and validly issued,
fully paid and non-assessable and that the Company will instruct its transfer agent to
issue certificates for the Common Stock issuable upon conversion of this Note.

	 
	 	B.	 	Effect of Capital Reorganization or Reclassification. If the number of
outstanding shares of Common Stock of the Company shall be increased or decreased as a
result of a stock split, a reverse stock split or similar recapitalization or
reclassification of stock not involving any change in the shareholder’s equity or the
aggregate market value of shares outstanding as a result thereof, the per share
Conversion Price shall be proportionately adjusted so that the percentage of the Common
Stock acquirable by the Holder upon conversion immediately prior to the event and
immediately following the event remains the same.

	4.	 	EVENTS OF DEFAULT

A default shall be defined as one or more of the following events (“Event of Default”)
occurring and continuing:

	 	(a)	 	The Maker shall fail to pay any interest payment on this Note when due for a
period of thirty (30) days after notice of such default has been sent by the Holder to
the Maker.

	 
	 	(b)	 	The Maker shall dissolve or terminate the existence of the Maker.

	 
	 	(c)	 	The Maker shall file a petition in bankruptcy, make an assignment for the
benefit of its creditors, or consent to or acquiesce in the appointment of a receiver
for all or substantially all of its property, or a petition for the appointment of a
receiver shall be filed against the Maker and remain unstayed for at least ninety (90)
days.

	 
	 	(d)	 	If the Company issues any new securities to any investor other than to the
Holder or to Professional Offshore Opportunity Fund, Ltd. (and its co-investors) under
January 2008 notes convertible into shares of its common stock, $0.0001 par value, at a
conversion price which is below $0.32 per share (adjusted to reflect any stock splits
or recapitalization transactions) such issuance will constitute an Event of Default
hereunder unless the Company in its discretion adjusts the conversion price hereunder
or other terms hereof acceptable to the Holder.

 

16

 

Upon the occurrence of an Event of Default, the Holder of this Note may, by written notice to
the Maker given by certified mail, return receipt requested, declare the unpaid principal amount
and all accrued interest of the Note immediately due and payable.

	5.	 	SECURITY FOR PAYMENT OF THE NOTE(S)

This Note is secured by a security interest granted to the Holder as described in that certain
Operating Loan and Security Agreement dated April
 _____ 
, 2008, covering the Collateral therein
described.

	6.	 	EFFECTIVE DATE OF THE NOTE

The Effective Date of this Note for purposes of its status as a binding legal obligation of
the Maker is the date hereof, which is also the date on which funds have been advanced by the
Holder and after which interest shall accrue on the unpaid principal balance hereof.

	7.	 	STATUS OF HOLDER

The Maker may treat the Holder of this Note as the absolute owner of this Note for the purpose
of making payments of principal or interest and for all other purposes, and shall not be affected
by any notice to the contrary, unless the Maker so consents in writing.

	8.	 	SECURITIES ACT RESTRICTIONS

This Note has not been registered for sale under the Act. This Note may not be sold, offered
for sale, pledged, assigned or otherwise disposed of, unless certain conditions are satisfied, as
more fully set forth in the Note and Warrant Purchase Agreement. The shares of Common Stock
issuable upon conversion of this Note may not be sold or transferred unless (i) they first
shall have been registered under the Securities Act of 1933, as amended, and applicable state
securities laws,(ii) the Company shall have been furnished with an opinion of legal counsel (in
form, substance and scope reasonably acceptable to Company) to the effect that such sale or
transfer is exempt from the registration requirements of the Act or (iii) they are sold pursuant
to Rule 144 under the Act. Each certificate for shares of Common Stock issuable upon conversion of
this Note that have not been so registered and that have not been sold pursuant to an exemption
that permits removal of the legend, shall bear a legend substantially in the following form, as
appropriate:

 

17

 

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED. THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD,
TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL IN FORM, SUBSTANCE AND SCOPE
REASONABLY ACCEPTABLE TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR UNLESS
SOLD PURSUANT TO RULE 144 UNDER SAID ACT. ANY SUCH SALE, ASSIGNMENT OR TRANSFER MUST ALSO BE MADE
IN COMPLIANCE WITH APPLICABLE STATE SECURITIES LAWS.”

	9.	 	ATTORNEYS’ FEES

The prevailing party in an action to enforce this Note shall be entitled to reasonable
attorneys’ fees, costs and collection expense.

	10.	 	MISCELLANEOUS.

(a) Successors and Assigns. The Holder may not assign, transfer or sell this Note to any
party without the express written consent of the Maker, such consent not to be unreasonably
withheld or delayed. This Note shall be binding upon and shall inure to the benefit of the parties
and their respective heirs, successors and assigns. Subject to the foregoing permitted transfers
and status of lawful successors, this Note shall not be enforceable by any other third party.

(b) Entire Agreement. This Note contains all oral and written agreements, representations and
arrangements between the parties with respect to its subject matter, and no representations or
warranties are made or implied, except as specifically set forth herein. No modification, waiver
or amendment of any of the provisions of this Note shall be effective unless in writing and signed
by both parties to this Note.

(c) Notices. Any notice or other communication to be given hereunder shall be in writing and
personally delivered or delivered via overnight mail, with written receipt therefor, or by a
nationally recognized overnight delivery service, charges and postage prepaid, properly addressed
to the party to receive such notice, at the following address for such party (or at such other
address as shall be specified by like notice given to the appropriate party):

	 	 	 
	if to Holder:

	 	Mr. Thomas P. Grainger
	 

	 	4 miles south of Saratoga – Highway 130
	 

	 	Saratoga WY 82331
	 
	 	 
	if to the Company:

	 	Smart Move, Inc.
	 

	 	5990 Greenwood Plaza Blvd., Suite 390
	 

	 	Greenwood Village, CO 80111
	 

	 	Attn: Executive Officers

Such notice shall be effective upon personal or overnight delivery or five (5) days after
mailing by certified mail.

 

18

 

(d) Section Headings. The headings of the various sections of the Note have been inserted as
a matter of convenience for reference only and shall be of no legal effect.

(e) Severability. If any provision of this Note is invalid, illegal or unenforceable, the
balance of this Note shall remain in effect, and if any provision is inapplicable to any person or
circumstance, it shall nevertheless remain applicable to all other persons and circumstances. If
it shall be found that any interest or other amount deemed interest due hereunder shall violate
applicable laws governing usury, the applicable rate of interest due hereunder shall automatically
be lowered to equal the maximum permitted rate of interest.

(f) Applicable Law. This Note shall be deemed to have been made in the State of Colorado, and
any and all performance hereunder, or breach thereof, shall be interpreted and construed pursuant
to the laws of the State of Colorado without regard to conflict of laws rules applied in the State
of Colorado. The parties hereto hereby consent to personal jurisdiction and venue exclusively in
the State of Colorado with respect to any action or proceeding brought with respect to this Note.

(g) Waiver of Jury Trial. THE PARTIES HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE
THE RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON OR
ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY TRANSACTION DOCUMENT OR ANY
COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY
PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES’ ACCEPTANCE OF THIS AGREEMENT.

(h) Lost, Stolen or Mutilated Note. If this Note is lost, stolen, mutilated or destroyed,
the Company will, on such reasonable terms with respect to indemnity or otherwise as it may in its
discretion impose, issue a new note of like denomination, tenor, and date as this Note. Any such
new note shall constitute an original contractual obligation of the Company, and the lost, stolen,
mutilated or destroyed, as applicable, Note shall be null and void.

IN WITNESS WHEREOF, the Company has caused this Unsecured Convertible Note to be duly executed
by a duly authorized officer as of the date set forth above.

	 	 	 	 	 	 	 	 	 	 	 
	Maker:	 	 	 	Accepted by Holder:	 	 
	Smart Move, Inc.	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	By:	 	 	 	 	 	Print Name:	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	Name:
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	Title:

	 	 	 	 	 	Date:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	Date:
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 

 

19

 

EXHIBIT “A”

NOTICE OF CONVERSION

(To be executed by the Holder in order to elect to convert the Note)

TO:

The undersigned hereby irrevocably elects to convert the principal amount of the above Note
into Shares of Common Stock of SMART MOVE, INC., according to the conditions stated therein, as of
the Conversion Date written below.

	 	 	 
	Conversion Date:
	 	 
	Applicable Conversion Price:
	 	$0.75 prior to cumulative advances of $750,000; $0.40 per share thereafter
	Signature:
	 	 
	Name:
	 	 
	Address:
	 	 
	Note amount converted:
	 	$
	Number of shares of Common Stock to be issued:
	 	 
	Please issue the shares of Common Stock in the
following name and to the following address:
	 	 
	Issue to:
	 	 
	Authorized Signature:
	 	 
	Name:
	 	 
	Title:
	 	 
	Phone Number:
	 	 
	Broker DTC Participant Code:
	 	 
	Account Number:
	 	 

If this name is different from the name of the Holder, the Holder will have to show compliance for
such transfer with federal and applicable state securities laws or in accordance with the plan of
distribution in any Registration Statement. By submitting this Notice of Conversion, the
undersigned Holder represents and warrants to the Company that Holder is an accredited investor as
that term is defined in SEC Rule 501(a) or otherwise able to evaluate the risks and merits of an
investment, that the Holder is a sophisticated investor as required by SEC Rule 506, that it has
completed such investigation into the Company and the securities being acquired pursuant to this
Notice of Conversion as the undersigned (in consultation with its advisors) has determined
appropriate, and that it is submitting this Notice of Conversion of its own volition and free will.

	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	Date:
	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	Name:	 	 	 	 	 	 	 	 
	Address:	 	 	 	 	 	 	 	 

Social Security Number

 

20

 

EXHIBIT B

This Warrant and the underlying shares of Common Stock represented by this Warrant have not been
registered under the Securities Act of 1933 (the “Act”), and are “restricted securities” as that
term is defined in Rule 144 under the Act. The securities may not be offered for sale, sold or
otherwise transferred except pursuant to an effective registration statement under the Act, or
pursuant to an exemption from registration under the Act, the availability of which is to be
established to the satisfaction of the Company.

			
	 	 	 
	April [May]
 _____ 
, 2008
	 	Warrant No.
 _____ 

***SMART MOVE, INC.***

WARRANT TO PURCHASE SHARES OF COMMON STOCK

Warrant to Purchase 625,000 Shares

(subject to adjustment as set forth herein)

Exercise Price $0.80 Per Share

(subject to adjustment as set forth herein)

VOID AFTER 3:00 P.M., MOUNTAIN TIME, ON

April [May]
 _____ 
, 2013

THIS CERTIFIES THAT Thomas P. Grainger is entitled to purchase from Smart Move, Inc., a
Delaware corporation (hereinafter called the “Company”) with its principal office located at 5990
Greenwood Plaza Blvd., Suite 390, Greenwood Village, Colorado 80111, at any time before 3:00 P.M.,
Mountain Time, on April [May]
 _____ 
, 2013 (the “Termination Date”), at the purchase price of $0.80 per
share, the number of shares (the “Shares”) of the Company’s common stock (the “Common Stock”) set
forth above. The number of Shares purchasable upon exercise of this Warrant and the Exercise Price
per Share shall be subject to adjustment from time to time as set forth in Section 4 below if the
number of outstanding shares of Common Stock of the Company shall be increased or decreased as a
result of a stock split, a reverse stock split or similar recapitalization or reclassification of
stock not involving any change in the shareholder’s equity or the aggregate market value of shares
outstanding as a result thereof,

SECTION 1. DEFINITIONS.

In addition to the terms defined elsewhere in this Warrant, the terms set forth on the
Definitions Schedule to this Warrant shall have the meanings set forth on such Schedule.

 

21

 

SECTION 2. COVERED SHARES; EXERCISE OF WARRANT.

Subject to the conditions set forth in this Warrant, the Warrant may be exercised in whole or
in part during the Exercise Period, but in no event subsequent to the end of the Exercise Period,
by the surrender of the Warrant (with the subscription form attached to this Warrant duly completed
and executed) at the principal office of the Company at 5990 Greenwood Plaza Blvd, Suite 390,
Greenwood Village, Colorado 80111, and upon payment of the applicable Exercise Price in cash or
other immediately available funds. At the option of the exercising Holder, payment may be made by
(a) cash or other immediately available funds.

The right granted by the Warrant to acquire Shares shall expire at the end of the Exercise
Period, and such right shall be wholly null and void to the extent the Warrant is not exercised
before that time. The Company shall pay all reasonable expenses, taxes and other charges payable in
connection with the preparation, execution and delivery of any certificates or other documents
evidencing the Shares under this §2. Notwithstanding the surrender of the Warrant upon its
exercise, the rights and obligations of the Company and the Holders as set forth in this Warrant
shall continue in full force and effect.

SECTION 3. RESERVATION.

At all times during the Exercise Period, the Company shall reserve and keep available the
maximum number of authorized but unissued Shares, solely for the purpose of issuing, upon the
exercise of the Warrant, a number of Shares equal to the number of Underlying Shares.

SECTION 4. ADJUSTMENT OF NUMBER OF SHARES.

The number of Warrant Shares and the Warrant Price shall be subject to adjustment if the
number of outstanding Shares of Common Stock of the Company shall be increased or decreased as a
result of a stock split, a reverse stock split or similar recapitalization or reclassification of
stock not involving any change in the shareholder’s equity or the aggregate market value of shares
outstanding as a result thereof. The Warrant Price and number of Shares shall be proportionately
adjusted so that the percentage of the Common Stock acquirable by the Holder upon exercise
immediately prior to the event and immediately following the event remains the same.

SECTION 5. DISSOLUTION OR LIQUIDATION; DIVIDENDS AND DISTRIBUTIONS.

Upon any proposed distribution of the assets of the Company in dissolution or liquidation, the
Company shall mail notice of such distribution to each Holder and shall make no distribution to its
shareholders until the expiration of forty five (45) days from the date of mailing of such notice.
Upon receipt of such notice, each Holder may exercise the Warrant at any time prior to the
expiration of such 45-day period and thereafter receive any distributions made to shareholders of the Company in
connection with such dissolution or liquidation.

 

22

 

SECTION 6. FULLY PAID SHARES; TAXES; FRACTIONAL SHARES.

The Company covenants and agrees that the Warrant Shares will, at the time of delivery upon
the exercise of the Warrant, be validly issued and outstanding and be fully paid and nonassessable.
The Company further covenants and agrees that it will pay when due and payable any and all federal
and state issuance taxes that may be payable in respect of the Warrant or any Warrant Shares or
certificates issued upon the exercise of the Warrant. The Company shall not, however, be required
to pay any tax which may be payable in respect of any Transfer involving a Transfer of Warrant
Shares in the name other than that of a Holder, and any such tax shall be paid by the Holder
requiring such Transfer. Fractional Warrant Shares shall be issued upon the exercise of the Warrant
in any case in which the Underlying Shares are not a whole number and the Holder does not agree to
accept cash in lieu of such fractional Warrant Shares.

SECTION 7. NOTIFICATION OF SHAREHOLDER MATTERS.

Prior to the exercise in full of the Warrant, the Company shall use reasonable efforts to
cause any notice submitted to the shareholders of the Company also to be provided to the Holder,
but shall have no liability to the Holder for failure to provide any such notice with respect to
any matters which are disclosed by the Company to its shareholders or which are available to
shareholders pursuant to the Company’s electronic filings with the Securities and Exchange
Commission (“SEC”) under the Securities Exchange Act of 1934.

	SECTION 8.
	 RESTRICTIONS ON TRANSFERABILITY OF WARRANTS AND SHARES; COMPLIANCE WITH LAWS.

8.1. In General. Neither the Warrant nor any Warrant Shares shall be Transferred
except upon the conditions specified in this Warrant, which conditions are intended to insure
compliance with the provisions of the Securities Act (or any similar federal statute at the time in
effect) and any applicable state securities laws in respect of any such Transfer.

8.2. Restrictive Legend. The Warrant Shares shall be represented by certificates,
and, unless otherwise permitted by the provisions of this §8.2, shall be marked with a legend
reading substantially as follows:

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED. THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD,
TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR AN OPINION OF
COUNSEL IN FORM, SUBSTANCE AND SCOPE REASONABLY ACCEPTABLE TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER
SAID ACT OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT. ANY SUCH SALE, ASSIGNMENT OR TRANSFER
MUST ALSO BE MADE IN COMPLIANCE WITH APPLICABLE STATE SECURITIES LAWS.

 

23

 

If a registration statement covering the Warrant or any Warrant Shares shall become effective under
the Securities Act and under any applicable state securities laws, or if the Company shall receive
an opinion of counsel reasonably satisfactory to the Company (which shall include counsel to the
Company and counsel to the original Holder of the Warrant) that, in the opinion of such counsel,
such legend is not required (including, without limitation, because of the availability of an
exemption afforded by Rule 144(k) under the Securities Act), the Company shall, or shall instruct
its transfer agents and registrars to, remove such legend or issue new Warrants or certificates
without such legend. Upon the reasonable written request of a Holder, the Company shall forthwith
request counsel to render an opinion with respect to the matters covered in this paragraph, and the
Company shall pay all expenses in connection with such matters.

SECTION 9. LOST, STOLEN WARRANTS, ETC.

If the Warrant or any certificates evidencing Warrant Shares shall be mutilated, lost, stolen
or destroyed, the Company shall issue a new Warrant or certificate of like date, tenor and
denomination and deliver the same in exchange and substitution for and upon surrender and
cancellation of the mutilated Warrant or certificate, or in lieu of the Warrant or certificate
lost, stolen or destroyed, upon receipt of evidence reasonably satisfactory to the Company (an
affidavit of the Holder shall be deemed sufficient) of the loss, theft or destruction of such
Warrant or certificate.

SECTION 10. MISCELLANEOUS.

10.1. Holder Not A Shareholder. Except as otherwise specifically provided in this
Warrant, prior to the exercise of the Warrant no Holder shall be entitled to any of the rights of a
shareholder of the Company, including the right as a shareholder to (a) vote or consent or (b)
receive dividends or any other distributions made in respect of Shares.

10.2. Notices. Any notice, demand or delivery to be made pursuant to the provisions
of this Warrant shall be in writing and (a) shall be deemed to have been given or made one day
after the date sent (i) if by the Company, by prepaid overnight delivery addressed to each Holder
at its last known address appearing on the books of the Company maintained for such purpose or (ii)
if by a Holder, by prepaid overnight delivery, addressed to the Company at the Company’s address as
set forth in §2; and (b) if given by courier or confirmed facsimile transmission shall be deemed to
have been made or given when received. Each Holder and the Company may each designate a different
address by notice to the other in the manner provided in this §11.2.

 

24

 

10.3. Successors and Assigns. Subject to all conditions and limitations contained
herein and to the requirements of applicable law, this Warrant and the rights evidenced by the
Warrant shall inure to the benefit of and be binding upon the lawful successors and assigns of the
Company and each Holder. The provisions of this Warrant are intended to be for the benefit of the
Holders of the Warrant or the Warrant Shares and shall be enforceable by the Holders.

10.4. Actions by Holder; Amendments and Waivers. Any provision of this Warrant may be
amended, waived or modified upon the written consent of the Company and the Holder.  Any amendment,
waiver, modification or consent entered into pursuant to this Section 11.4 shall be effective only
in the specific instance and for the specific purpose for which it was given.

10.5. Headings; Severability. The descriptive headings of sections of this Warrant
are provided solely for convenience of reference and shall not, for any purpose, be deemed a part
of this Warrant. Should any part of the Warrant or this Warrant for any reason be declared invalid,
such decision shall not affect the validity of any remaining portion, which shall remain in force
and effect as if the Warrant and this Warrant had been executed with the invalid portion
eliminated. It is the intention of the Company and the Holder that they would have executed and
accepted the remaining portion of the Warrant and this Warrant without including in such remaining
portion any such part, parts or portion which may, for any reason, be hereafter declared invalid.

10.6. Governing Law. The Warrant and this Warrant and all matters concerning the
Warrant and this Warrant shall be governed by the laws of the State of Colorado for contracts
entered into and to be performed in such state without regard to principles of conflicts of laws;
provided however, that with respect to the Company’s internal corporate matters, the laws
of the State of Delaware shall govern.

10.7. Survival of Certain Provisions. Except as otherwise provided, the provisions of
this Warrant shall survive the exercise of the Warrant and shall continue in full force and effect
following such exercise until all Warrant Shares are no longer restricted securities under the
federal securities laws.

10.8. Specific Performance. The Company acknowledges and agrees that the Holders
would be damaged irreparably in the event any of the provisions of this Warrant are not performed
in accordance with their specific terms or otherwise are breached. Accordingly, the Company agrees
that the Holders shall be entitled to an injunction or injunctions to prevent breaches of the
provisions of this Warrant and to enforce specifically this Warrant and the terms and provisions of
this Warrant in any action instituted in any federal or state court in the United States having
jurisdiction over the parties and the matter, in addition to any other remedy to which the Holders
may be entitled, at law or in equity.

 

25

 

10.9. Consent to Jurisdiction. THE COMPANY HEREBY CONSENTS TO THE JURISDICTION OF ANY
STATE OR FEDERAL COURT LOCATED WITHIN THE COUNTY OF DENVER, STATE OF COLORADO AND IRREVOCABLY
AGREES THAT, SUBJECT TO THE HOLDER’S ELECTION, ALL ACTIONS OR PROCEEDINGS ARISING OUT OF OR
RELATING TO THIS WARRANT SHALL BE LITIGATED IN SUCH COURTS. THE COMPANY ACCEPTS FOR ITSELF AND IN
CONNECTION WITH ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF THE
AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS, AND IRREVOCABLY AGREES TO BE BOUND
BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER FINANCING DOCUMENT.
THE COMPANY DESIGNATES AND APPOINTS CHRIS SAPYTA, AND SUCH OTHER PERSON AS MAY HEREAFTER BE
SELECTED BY THE COMPANY WHO IRREVOCABLY AGREES IN WRITING TO SO SERVE AS ITS AGENT TO RECEIVE ON
ITS BEHALF SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDINGS IN ANY SUCH COURT, SUCH SERVICE BEING
HEREBY ACKNOWLEDGED BY THE COMPANY TO BE EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT. A COPY OF
ANY SUCH PROCESS SO SERVED SHALL BE MAILED BY THE HOLDER BY REGISTERED MAIL TO THE COMPANY AT ITS
ADDRESS PROVIDED IN §12.2 AND SHALL BE DEEMED TO HAVE BEEN RECEIVED BY THE COMPANY FIVE (5) DAYS
AFTER BEING SO MAILED. IF ANY AGENT APPOINTED BY THE COMPANY REFUSES TO ACCEPT SERVICE, THE
COMPANY HEREBY AGREES THAT SERVICE UPON IT BY MAIL SHALL CONSTITUTE SUFFICIENT NOTICE. NOTHING IN
THIS WARRANT SHALL AFFECT THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL
LIMIT THE RIGHT OF HOLDER TO BRING PROCEEDINGS AGAINST THE COMPANY IN THE COURTS OF ANY OTHER
JURISDICTION.

10.10. Waiver of Jury Trial. EACH OF THE COMPANY AND THE HOLDER HEREBY WAIVES THE
RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED UPON, ARISING OUT OF, OR IN ANY WAY
RELATING TO: (A) THIS WARRANT, OR (B) ANY OTHER PRESENT OR FUTURE INSTRUMENT OR AGREEMENT BETWEEN
THE HOLDER AND THE COMPANY; OR (C) ANY CONDUCT, ACTS OR OMISSIONS OF THE COMPANY OR THE HOLDER OR
ANY OF THEIR DIRECTORS, MANAGERS, OFFICERS, EMPLOYEES, AGENTS, PARTNERS, REPRESENTATIVES, ATTORNEYS
OR ANY OTHER PERSONS AFFILIATED WITH THE COMPANY OR THE HOLDER; IN EACH OF THE FOREGOING CASES,
WHETHER SOUNDING IN TORT OR OTHERWISE. EACH OF THE COMPANY AND THE HOLDER ALSO WAIVES ANY BOND OR
SURETY OR SECURITY UPON SUCH BOND WHICH MIGHT, BUT FOR THIS WAIVER, BE REQUIRED. THE SCOPE OF THIS
WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT
AND THAT RELATE TO THE SUBJECT MATTER OF THIS WARRANT, INCLUDING CONTRACT CLAIMS, TORT CLAIMS,
BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. EACH OF THE COMPANY AND THE
HOLDER ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL

 

26

 

INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED ON THE WAIVER
IN ENTERING INTO THIS AGREEMENT AND THAT EACH WILL CONTINUE TO RELY ON THE WAIVER IN THEIR RELATED
FUTURE DEALINGS. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR
IN WRITING, AND THE WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS WARRANT OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE WARRANT.
EACH OF THE COMPANY AND THE HOLDER FURTHER WARRANTS AND REPRESENTS THAT EACH HAS REVIEWED THIS
WAIVER WITH ITS LEGAL COUNSEL, AND THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS
FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED
AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

IN WITNESS WHEREOF, this Warrant has been duly executed as of the day and year first above
written.

SMART MOVE, INC.

  
            
            
            
            
       

Chris Sapyta

President

 

27

 

ELECTION TO EXERCISE WARRANT

TO: Smart Move, Inc.:

The undersigned registered holder of the Warrant, a true and correct copy of which is attached
to this election notice, irrevocably exercises the Warrant and purchases pursuant to such exercise
               
      Shares of the Company, makes payment of $     
    for such Shares, and requests that the
certificates for such Shares be issued in the name of the undersigned holder or its nominee and
delivered to such holder at holder’s address on the books of the Company.

	 	 	 
	Entity Name (if applicable):
	 	 
	 
	 	 
	 

	 	 

	 	 	 	 	 
	By:
	 	 	 	 
	Name:

	 	 

	 	 
	Title:

	 	 

	 	 
	Date:

	 	 

	 	 
	 

	 	 

	 	 

ASSIGNMENT

FOR VALUE RECEIVED, the undersigned registered holder of the Warrant attached to this
assignment notice, sells, assigns and transfers unto                      the Warrant and all rights
evidenced by such Warrant and does irrevocably constitute and irrevocably appoints Corporate Stock
Transfer, Inc. or other duly appointed transfer agent for the securities as the undersigned’s
attorney to transfer such Warrant on the books of the Company.

	 	 	 
	Entity Name (if applicable):
	 	 
	 
	 	 
	 

	 	 

	 	 	 	 	 
	By:
	 	 	 	 
	Name:

	 	 

	 	 
	Title:

	 	 

	 	 
	Date:

	 	 

	 	 
	 

	 	 

	 	 

 

28

 

Warrant Definitions Schedule

As used in this Warrant, the following terms have the following respective meanings:

“Company” means Smart Move, Inc., a Delaware corporation, and any successor to all or
substantially all of the assets and business of Smart Move, Inc. Unless the context otherwise
indicates, “Company” shall also include all Subsidiaries of the Company.

“Exercise Period” means the period commencing on the First Exercise Date and terminating at
3:00 p.m., Denver time, on the Expiration Date.

“Expiration Date,” with reference to this Warrant, means April [May]
 _____ 
, 2013.

“First Exercise Date” means the date of original issuance of the Warrant.

“Holder” means a registered holder of the Warrant and, if the context so indicates, the holder
of Shares.

“Securities Act” means the Securities Act of 1933, as amended, or any similar federal statute,
and the rules and regulations under such act, all as the same shall be effect at the time.

“Shares” means, shares of the Company’s common stock, par value $.0001 per share, and stock of
any other class into which such shares may hereafter be changed or reclassified.

“Transfer” means any sale, transfer, issuance, assignment, pledge or other disposition or
conveyance of Shares or the Warrant.

“Underlying Shares” means the Shares issuable upon exercise of the Warrant.

“Warrant” means the Warrant issued on the date of this Warrant to the Holder and any warrant
issued in exchange or substitution for the Warrant.

“Warrant Shares” means the Shares obtained upon exercise of the Warrant.

 

29

 

EXHIBIT C

This Warrant and the underlying shares of Common Stock represented by this Warrant have not been
registered under the Securities Act of 1933 (the “Act”), and are “restricted securities” as that
term is defined in Rule 144 under the Act. The securities may not be offered for sale, sold or
otherwise transferred except pursuant to an effective registration statement under the Act, or
pursuant to an exemption from registration under the Act, the availability of which is to be
established to the satisfaction of the Company.

			
	 	 	 
	April [May]
 _____ 
, 2008
	 	Warrant No.
 _____ 

***SMART MOVE, INC.***

WARRANT TO PURCHASE SHARES OF COMMON STOCK

Warrant to Purchase 1,875,000 Shares

(subject to adjustment as set forth herein)

Exercise Price $1.00 Per Share

(subject to adjustment as set forth herein)

VOID AFTER 3:00 P.M., MOUNTAIN TIME, ON

                    , 2013

THIS CERTIFIES THAT, as a result of a concurrent release of collateral previously securing
indebtedness of Smart Move, Inc., a Delaware corporation (hereinafter called the “Company”) with
its principal office located at 5990 Greenwood Plaza Blvd., Suite 390, Greenwood Village, Colorado
80111, to Thomas P. Grainger, Thomas P. Grainger is entitled under the terms hereof to purchase
from Smart Move, Inc., , at any time before 3:00 P.M., Mountain Time, on                     , 2013 (the
“Termination Date”), at the purchase price of $1.00 per share, the number of shares (the “Shares”)
of the Company’s common stock (the “Common Stock”) set forth above. The number of Shares
purchasable upon exercise of this Warrant and the Exercise Price per Share shall be subject to
adjustment from time to time as set forth in Section 4 below if the number of outstanding shares of
Common Stock of the Company shall be increased or decreased as a result of a stock split, a
reverse stock split or similar recapitalization or reclassification of stock not involving any
change in the shareholder’s equity or the aggregate market value of shares outstanding as a result
thereof,

SECTION 1. DEFINITIONS.

In addition to the terms defined elsewhere in this Warrant, the terms set forth on the
Definitions Schedule to this Warrant shall have the meanings set forth on such Schedule.

 

30

 

SECTION 2. COVERED SHARES; EXERCISE OF WARRANT.

Subject to the conditions set forth in this Warrant, the Warrant may be exercised in whole or
in part during the Exercise Period, but in no event subsequent to the end of the Exercise Period,
by the surrender of the Warrant (with the subscription form attached to this Warrant duly completed
and executed) at the principal office of the Company at 5990 Greenwood Plaza Blvd, Suite 390,
Greenwood Village, Colorado 80111, and upon payment of the applicable Exercise Price in cash or
other immediately available funds. At the option of the exercising Holder, payment may be made by
(a) cash or other immediately available funds.

The right granted by the Warrant to acquire Shares shall expire at the end of the Exercise
Period, and such right shall be wholly null and void to the extent the Warrant is not exercised
before that time. The Company shall pay all reasonable expenses, taxes and other charges payable in
connection with the preparation, execution and delivery of any certificates or other documents
evidencing the Shares under this §2. Notwithstanding the surrender of the Warrant upon its
exercise, the rights and obligations of the Company and the Holders as set forth in this Warrant
shall continue in full force and effect.

SECTION 3. RESERVATION.

At all times during the Exercise Period, the Company shall reserve and keep available the
maximum number of authorized but unissued Shares, solely for the purpose of issuing, upon the
exercise of the Warrant, a number of Shares equal to the number of Underlying Shares.

SECTION 4. ADJUSTMENT OF NUMBER OF SHARES.

The number of Warrant Shares and the Warrant Price shall be subject to adjustment if the
number of outstanding Shares of Common Stock of the Company shall be increased or decreased as a
result of a stock split, a reverse stock split or similar recapitalization or reclassification of
stock not involving any change in the shareholder’s equity or the aggregate market value of shares
outstanding as a result thereof. The Warrant Price and number of Shares shall be proportionately
adjusted so that the percentage of the Common Stock acquirable by the Holder upon exercise
immediately prior to the event and immediately following the event remains the same.

SECTION 5. DISSOLUTION OR LIQUIDATION; DIVIDENDS AND DISTRIBUTIONS.

Upon any proposed distribution of the assets of the Company in dissolution or liquidation, the
Company shall mail notice of such distribution to each Holder and shall make no distribution to its
shareholders until the expiration of forty five (45) days from the date of mailing of such notice.
Upon receipt of such notice, each Holder may exercise the Warrant at any time prior to the
expiration of such 45-day period and thereafter receive any distributions made to shareholders of the Company in
connection with such dissolution or liquidation.

 

31

 

SECTION 6. FULLY PAID SHARES; TAXES; FRACTIONAL SHARES.

The Company covenants and agrees that the Warrant Shares will, at the time of delivery upon
the exercise of the Warrant, be validly issued and outstanding and be fully paid and nonassessable.
The Company further covenants and agrees that it will pay when due and payable any and all federal
and state issuance taxes that may be payable in respect of the Warrant or any Warrant Shares or
certificates issued upon the exercise of the Warrant. The Company shall not, however, be required
to pay any tax which may be payable in respect of any Transfer involving a Transfer of Warrant
Shares in the name other than that of a Holder, and any such tax shall be paid by the Holder
requiring such Transfer. Fractional Warrant Shares shall be issued upon the exercise of the Warrant
in any case in which the Underlying Shares are not a whole number and the Holder does not agree to
accept cash in lieu of such fractional Warrant Shares.

SECTION 7. NOTIFICATION OF SHAREHOLDER MATTERS.

Prior to the exercise in full of the Warrant, the Company shall use reasonable efforts to
cause any notice submitted to the shareholders of the Company also to be provided to the Holder,
but shall have no liability to the Holder for failure to provide any such notice with respect to
any matters which are disclosed by the Company to its shareholders or which are available to
shareholders pursuant to the Company’s electronic filings with the Securities and Exchange
Commission (“SEC”) under the Securities Exchange Act of 1934.

	SECTION 8.
	 RESTRICTIONS ON TRANSFERABILITY OF WARRANTS AND SHARES; COMPLIANCE WITH LAWS.

8.1. In General. Neither the Warrant nor any Warrant Shares shall be Transferred
except upon the conditions specified in this Warrant, which conditions are intended to insure
compliance with the provisions of the Securities Act (or any similar federal statute at the time in
effect) and any applicable state securities laws in respect of any such Transfer.

8.2. Restrictive Legend. The Warrant Shares shall be represented by certificates,
and, unless otherwise permitted by the provisions of this §8.2, shall be marked with a legend
reading substantially as follows:

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED. THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD,
TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR AN OPINION OF
COUNSEL IN FORM, SUBSTANCE AND SCOPE REASONABLY ACCEPTABLE TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER
SAID ACT OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT. ANY SUCH SALE, ASSIGNMENT OR TRANSFER
MUST ALSO BE MADE IN COMPLIANCE WITH APPLICABLE STATE SECURITIES LAWS.

 

32

 

If a registration statement covering the Warrant or any Warrant Shares shall become effective under
the Securities Act and under any applicable state securities laws, or if the Company shall receive
an opinion of counsel reasonably satisfactory to the Company (which shall include counsel to the
Company and counsel to the original Holder of the Warrant) that, in the opinion of such counsel,
such legend is not required (including, without limitation, because of the availability of an
exemption afforded by Rule 144(k) under the Securities Act), the Company shall, or shall instruct
its transfer agents and registrars to, remove such legend or issue new Warrants or certificates
without such legend. Upon the reasonable written request of a Holder, the Company shall forthwith
request counsel to render an opinion with respect to the matters covered in this paragraph, and the
Company shall pay all expenses in connection with such matters.

SECTION 9. LOST, STOLEN WARRANTS, ETC.

If the Warrant or any certificates evidencing Warrant Shares shall be mutilated, lost, stolen
or destroyed, the Company shall issue a new Warrant or certificate of like date, tenor and
denomination and deliver the same in exchange and substitution for and upon surrender and
cancellation of the mutilated Warrant or certificate, or in lieu of the Warrant or certificate
lost, stolen or destroyed, upon receipt of evidence reasonably satisfactory to the Company (an
affidavit of the Holder shall be deemed sufficient) of the loss, theft or destruction of such
Warrant or certificate.

SECTION 10. MISCELLANEOUS.

10.1. Holder Not A Shareholder. Except as otherwise specifically provided in this
Warrant, prior to the exercise of the Warrant no Holder shall be entitled to any of the rights of a
shareholder of the Company, including the right as a shareholder to (a) vote or consent or (b)
receive dividends or any other distributions made in respect of Shares.

10.2. Notices. Any notice, demand or delivery to be made pursuant to the provisions
of this Warrant shall be in writing and (a) shall be deemed to have been given or made one day
after the date sent (i) if by the Company, by prepaid overnight delivery addressed to each Holder
at its last known address appearing on the books of the Company maintained for such purpose or (ii)
if by a Holder, by prepaid overnight delivery, addressed to the Company at the Company’s address as
set forth in §2; and (b) if given by courier or confirmed facsimile transmission shall be deemed to
have been made or given when received. Each Holder and the Company may each designate a different
address by notice to the other in the manner provided in this §11.2.

 

33

 

10.3. Successors and Assigns. Subject to all conditions and limitations contained
herein and to the requirements of applicable law, this Warrant and the rights evidenced by the
Warrant shall inure to the benefit of and be binding upon the lawful successors and assigns of the
Company and each Holder. The provisions of this Warrant are intended to be for the benefit of the
Holders of the Warrant or the Warrant Shares and shall be enforceable by the Holders.

10.4. Actions by Holder; Amendments and Waivers. Any provision of this Warrant may be
amended, waived or modified upon the written consent of the Company and the Holder.  Any amendment,
waiver, modification or consent entered into pursuant to this Section 11.4 shall be effective only
in the specific instance and for the specific purpose for which it was given.

10.5. Headings; Severability. The descriptive headings of sections of this Warrant
are provided solely for convenience of reference and shall not, for any purpose, be deemed a part
of this Warrant. Should any part of the Warrant or this Warrant for any reason be declared invalid,
such decision shall not affect the validity of any remaining portion, which shall remain in force
and effect as if the Warrant and this Warrant had been executed with the invalid portion
eliminated. It is the intention of the Company and the Holder that they would have executed and
accepted the remaining portion of the Warrant and this Warrant without including in such remaining
portion any such part, parts or portion which may, for any reason, be hereafter declared invalid.

10.6. Governing Law. The Warrant and this Warrant and all matters concerning the
Warrant and this Warrant shall be governed by the laws of the State of Colorado for contracts
entered into and to be performed in such state without regard to principles of conflicts of laws;
provided however, that with respect to the Company’s internal corporate matters, the laws
of the State of Delaware shall govern.

10.7. Survival of Certain Provisions. Except as otherwise provided, the provisions of
this Warrant shall survive the exercise of the Warrant and shall continue in full force and effect
following such exercise until all Warrant Shares are no longer restricted securities under the
federal securities laws.

10.8. Specific Performance. The Company acknowledges and agrees that the Holders
would be damaged irreparably in the event any of the provisions of this Warrant are not performed
in accordance with their specific terms or otherwise are breached. Accordingly, the Company agrees
that the Holders shall be entitled to an injunction or injunctions to prevent breaches of the
provisions of this Warrant and to enforce specifically this Warrant and the terms and provisions of
this Warrant in any action instituted in any federal or state court in the United States having
jurisdiction over the parties and the matter, in addition to any other remedy to which the Holders
may be entitled, at law or in equity.

 

34

 

10.9. Consent to Jurisdiction. THE COMPANY HEREBY CONSENTS TO THE JURISDICTION OF ANY
STATE OR FEDERAL COURT LOCATED WITHIN THE COUNTY OF DENVER, STATE OF COLORADO AND IRREVOCABLY
AGREES THAT, SUBJECT TO THE HOLDER’S ELECTION, ALL ACTIONS OR PROCEEDINGS ARISING OUT OF OR
RELATING TO THIS WARRANT SHALL BE LITIGATED IN SUCH COURTS. THE COMPANY ACCEPTS FOR ITSELF AND IN
CONNECTION WITH ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF THE
AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS, AND IRREVOCABLY AGREES TO BE BOUND
BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER FINANCING DOCUMENT.
THE COMPANY DESIGNATES AND APPOINTS CHRIS SAPYTA, AND SUCH OTHER PERSON AS MAY HEREAFTER BE
SELECTED BY THE COMPANY WHO IRREVOCABLY AGREES IN WRITING TO SO SERVE AS ITS AGENT TO RECEIVE ON
ITS BEHALF SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDINGS IN ANY SUCH COURT, SUCH SERVICE BEING
HEREBY ACKNOWLEDGED BY THE COMPANY TO BE EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT. A COPY OF
ANY SUCH PROCESS SO SERVED SHALL BE MAILED BY THE HOLDER BY REGISTERED MAIL TO THE COMPANY AT ITS
ADDRESS PROVIDED IN §12.2 AND SHALL BE DEEMED TO HAVE BEEN RECEIVED BY THE COMPANY FIVE (5) DAYS
AFTER BEING SO MAILED. IF ANY AGENT APPOINTED BY THE COMPANY REFUSES TO ACCEPT SERVICE, THE
COMPANY HEREBY AGREES THAT SERVICE UPON IT BY MAIL SHALL CONSTITUTE SUFFICIENT NOTICE. NOTHING IN
THIS WARRANT SHALL AFFECT THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL
LIMIT THE RIGHT OF HOLDER TO BRING PROCEEDINGS AGAINST THE COMPANY IN THE COURTS OF ANY OTHER
JURISDICTION.

10.10. Waiver of Jury Trial. EACH OF THE COMPANY AND THE HOLDER HEREBY WAIVES THE
RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED UPON, ARISING OUT OF, OR IN ANY WAY
RELATING TO: (A) THIS WARRANT, OR (B) ANY OTHER PRESENT OR FUTURE INSTRUMENT OR AGREEMENT BETWEEN
THE HOLDER AND THE COMPANY; OR (C) ANY CONDUCT, ACTS OR OMISSIONS OF THE COMPANY OR THE HOLDER OR
ANY OF THEIR DIRECTORS, MANAGERS, OFFICERS, EMPLOYEES, AGENTS, PARTNERS, REPRESENTATIVES, ATTORNEYS
OR ANY OTHER PERSONS AFFILIATED WITH THE COMPANY OR THE HOLDER; IN EACH OF THE FOREGOING CASES,
WHETHER SOUNDING IN TORT OR OTHERWISE. EACH OF THE COMPANY AND THE HOLDER ALSO WAIVES ANY BOND OR
SURETY OR SECURITY UPON SUCH BOND WHICH MIGHT, BUT FOR THIS WAIVER, BE REQUIRED. THE SCOPE OF THIS
WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT
AND THAT RELATE TO THE SUBJECT MATTER OF THIS WARRANT, INCLUDING CONTRACT CLAIMS, TORT CLAIMS,
BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. EACH OF THE COMPANY AND THE
HOLDER ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL

 

35

 

INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED ON THE WAIVER
IN ENTERING INTO THIS AGREEMENT AND THAT EACH WILL CONTINUE TO RELY ON THE WAIVER IN THEIR RELATED
FUTURE DEALINGS. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR
IN WRITING, AND THE WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS WARRANT OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE WARRANT.
EACH OF THE COMPANY AND THE HOLDER FURTHER WARRANTS AND REPRESENTS THAT EACH HAS REVIEWED THIS
WAIVER WITH ITS LEGAL COUNSEL, AND THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS
FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED
AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

IN WITNESS WHEREOF, this Warrant has been duly executed as of the day and year first above
written.

SMART MOVE, INC.

  
            
            
            
            
       

Chris Sapyta

President

 

36

 

ELECTION TO EXERCISE WARRANT

TO: Smart Move, Inc.:

The undersigned registered holder of the Warrant, a true and correct copy of which is attached
to this election notice, irrevocably exercises the Warrant and purchases pursuant to such exercise

 _____ 
Shares of the Company, makes payment of

 $
 _____ 
for such Shares, and requests that the
certificates for such Shares be issued in the name of the undersigned holder or its nominee and
delivered to such holder at holder’s address on the books of the Company.

	 	 	 	 	 
	Entity Name (if applicable):	 	 
	 
	 	 	 	 
	 	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 
	Name:
	 	 	 	 
	 

	 	 	 	 
	Title:
	 	 	 	 
	 

	 	 	 	 
	Date:
	 	 	 	 
	 

	 	 	 	 

ASSIGNMENT

FOR VALUE RECEIVED, the undersigned registered holder of the Warrant attached to this
assignment notice, sells, assigns and transfers unto
 _____ 
the Warrant and all rights
evidenced by such Warrant and does irrevocably constitute and irrevocably appoints Corporate Stock
Transfer, Inc. or other duly appointed transfer agent for the securities as the undersigned’s
attorney to transfer such Warrant on the books of the Company.

	 	 	 	 	 
	Entity Name (if applicable):	 	 
	 
	 	 	 	 
	 	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 
	Name:
	 	 	 	 
	 

	 	 	 	 
	Title:
	 	 	 	 
	 

	 	 	 	 
	Date:
	 	 	 	 
	 

	 	 	 	 

 

37

 

Warrant Definitions Schedule

As used in this Warrant, the following terms have the following respective meanings:

“Company” means Smart Move, Inc., a Delaware corporation, and any successor to all or
substantially all of the assets and business of Smart Move, Inc. Unless the context otherwise
indicates, “Company” shall also include all Subsidiaries of the Company.

“Exercise Period” means the period commencing on the First Exercise Date and terminating at
3:00 p.m., Denver time, on the Expiration Date.

“Expiration Date,” with reference to this Warrant, means
 _____, 2013.

“First Exercise Date” means the date of original issuance of the Warrant.

“Holder” means a registered holder of the Warrant and, if the context so indicates, the holder
of Shares.

“Securities Act” means the Securities Act of 1933, as amended, or any similar federal statute,
and the rules and regulations under such act, all as the same shall be effect at the time.

“Shares” means, shares of the Company’s common stock, par value $.0001 per share, and stock of
any other class into which such shares may hereafter be changed or reclassified.

“Transfer” means any sale, transfer, issuance, assignment, pledge or other disposition or
conveyance of Shares or the Warrant.

“Underlying Shares” means the Shares issuable upon exercise of the Warrant.

“Warrant” means the Warrant issued on the date of this Warrant to the Holder and any warrant
issued in exchange or substitution for the Warrant.

“Warrant Shares” means the Shares obtained upon exercise of the Warrant.

 

38

 

Exhibit “D”

CONFIDENTIAL INVESTOR QUESTIONNAIRE

	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	Mr.	 	 	 	 	 	 
	1.

	 	Investor Name  
	 	Mrs.	 	 	 	Age 	 	 
	 

	 	 	 	 	 	 
	 	 	 	 
	 

	 	 	 	Ms.	 	 	 	 	 	 

	 	 	 
	Res. Address
	 	 
	 

	 	 

	 	 	 	 	 	 	 	 	 	 	 
	City 

	 	 	 	State 
	 	 	 	Zip 	 	 
	 

	 	 
	 	 	 	 
	 	 	 	 

	 	 	 	 	 	 	 
	S.S # or Tax I.D. # 

	 	 	 	Telephone 	 	 
	 

	 	 
	 	 	 	 

	 	 	 	 	 	 	 	 	 
	2.

	 	Bus. Affiliation
	 	 	 	Telephone	 	 
	 

	 	 	 	 
	 	 	 	 

	 	 	 	 	 	 	 
	Bus. Address

	 	 	 	Telephone	 	 
	 

	 	 
	 	 	 	 

	 	 	 	 	 	 	 	 	 	 	 
	City

	 	 	 	State
	 	 	 	Zip	 	 
	 

	 	 
	 	 	 	 
	 	 	 	 

	 	 	 
	Type of Business
	 	 
	 

	 	 

	 	 	 
	Position and Description of Responsibilities
	 	 
	 

	 	 

	3.	 	Please indicate the frequency of Investors investment in privately placed securities.

	 	 	 	 	 	 	 	 	 	 	 
	Often 

	 	 	 	 	 	Occasionally 
	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Seldom 

	 	 	 	 	 	Never 	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 

4. Investor’s estimated NET WORTH (including spouse’s net worth) is in excess of $1,000,000.00

YES o      NO o

5. For the last two years, this year and the next two years Investor’s individual TAXABLE
INCOME/ESTIMATED TAXABLE INCOME (excluding spouse’s income) has and is anticipated to
exceed $200,000.00.

YES o      NO o

6. For the last two years, this year and the next two years Investor’s joint TAXABLE
INCOME/ESTIMATED TAXABLE INCOME (including Investor’s spouse) has and is anticipated to exceed
$300,000.00.

YES o      NO o

7. Taxes filed by:  Joint Return                      Single                      Head of Household                  
    Other                     

8. I am able to BEAR THE ECONOMIC RISKS of a private placement investment including the possible
recognition of taxable income without related cash distributions and the illiquid nature of such
investment.

YES o      NO o

9. I have SUFFICIENT KNOWLEDGE AND EXPERIENCE in financial and business matters to be able to
evaluate the merits and risks of tax-oriented private placement investments, WITHOUT RELYING upon
the advise of an attorney, accountant or other advisor to make a final decision.

YES o      NO o

 

39

 

10. If the answer to Question 9 is “NO”, I designate the following person to serve as my PURCHASER
REPRESENTATIVE to assist in considering the merits and risks of a private placement investment.
THIS INFORMATION IS REQUIRED ONLY IF THE ANSWER TO QUESTION 9 IS “NO”:

	 	 	 	 	 	 	 
	Name

	 	 	 	Telephone	 	 
	 

	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	Firm

	 	 	 	Position	 	 
	 

	 	 
	 	 	 	 

	 	 	 
	Address
	 	 
	 

	 	 

	 	 	 	 	 	 	 	 	 	 	 
	City

	 	 	 	State
	 	 	 	Zip	 	 
	 

	 	 
	 	 	 	 
	 	 	 	 

	11.	 	ADDITIONAL INFORMATION, if any, useful to qualify me as an investor:

	 	 	 	 	 
	 

	 	 

	 	 
	 
	 	 	 	 
	 

	 	 

	 	 
	 
	 	 	 	 
	 

	 	 

	 	 

I understand that the information being furnished is required to determine whether sales of
private placement investments may be made to me without registration under the Securities Act of
1933, as amended. I represent that the information I have supplied is true and correct to the best
of my knowledge.

	 	 	 	 	 
	Date:                                         , 20__	 	 
	 
	 	 	 	 
	Investor’s Name (Print)
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	Joint Investor’s Name (Print)
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	Investor’s Signature
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	Joint Investor’s Signature
	 	 	 	 
	 

	 	 	 	 

 

40Filed by Bowne Pure Compliance

 

Exhibit 4.2

This Warrant and the underlying shares of Common Stock represented by this Warrant have not been
registered under the Securities Act of 1933 (the “Act”), and are “restricted securities” as that
term is defined in Rule 144 under the Act. The securities may not be offered for sale, sold or
otherwise transferred except pursuant to an effective registration statement under the Act, or
pursuant to an exemption from registration under the Act, the availability of which is to be
established to the satisfaction of the Company.

			
	 	 	 
	April 14, 2008
	 	Warrant No.
 _____ 

***SMART MOVE, INC.***

WARRANT TO PURCHASE SHARES OF COMMON STOCK

Warrant to Purchase
 _____ 
Shares

(subject to adjustment as set forth herein)

Exercise Price $1.00 Per Share

(subject to adjustment as set forth herein)

VOID AFTER 3:00 P.M., MOUNTAIN TIME, ON

April 14, 2013

THIS CERTIFIES THAT
 _____ 
is entitled to purchase from Smart Move, Inc., a
Delaware corporation (hereinafter called the “Company”) with its principal office located at 5990
Greenwood Plaza Blvd., Suite 390, Greenwood Village, Colorado 80111, at any time before 3:00 P.M.,
Mountain Time, on April 14, 2013 (the “Termination Date”), at the purchase price of $1.00 per
share, the number of shares (the “Shares”) of the Company’s common stock, par value $0.0001 per
share (the “Common Stock”) set forth above. This Warrant is one of a number of warrants covering
an aggregate 1,000,000 shares of Common Stock which are being issued concurrently by the Company to
those holders of existing secured notes who are identified in Exhibit “A” hereto as holders of
secured debt aggregating $9,217,500, who have agreed to release their respective liens pursuant to
security interests covering 800 existing proprietary shipping containers (“SmartVaultsTM), used to
transport household goods and other goods, and is the agreed consideration for such release. The
number of Shares purchasable upon exercise of this Warrant and the Exercise Price per Share shall
be subject to adjustment from time to time as set forth in Section 4 below if the number of
outstanding shares of Common Stock of the Company shall be increased or decreased as a result of a
stock split, a reverse stock split or similar recapitalization or reclassification of stock not
involving any change in the shareholder’s equity or the aggregate market value of shares
outstanding as a result thereof. The holder of this Warrant acknowledges that the Company has
listed its common stock on the American Stock Exchange and understands that the issuance of the
shares underlying the Notes
and warrants to purchase securities hereunder is subject to the prior approval of the American
Stock Exchange of such listing. The holder further acknowledges, agrees and represents that this
Warrant is being issued pursuant to an exemption from registration under Federal Rule 506 of
Regulation D under the Securities Act of 1933 and is based in part upon the holder’s prior and
concurrent representations to the Company regarding suitability of the investment.

 

1

 

SECTION 1. DEFINITIONS.

In addition to the terms defined elsewhere in this Warrant, the terms set forth on the
Definitions Schedule to this Warrant shall have the meanings set forth on such Schedule.

SECTION 2. COVERED SHARES; EXERCISE OF WARRANT.

Subject to the conditions set forth in this Warrant, the Warrant may be exercised in whole or
in part during the Exercise Period, but in no event subsequent to the end of the Exercise Period,
by the surrender of the Warrant (with the subscription form attached to this Warrant duly completed
and executed) at the principal office of the Company at 5990 Greenwood Plaza Blvd, Suite 390,
Greenwood Village, Colorado 80111, and upon payment of the applicable Exercise Price in cash or
other immediately available funds.

The right granted by the Warrant to acquire Shares shall expire at the end of the Exercise
Period, and such right shall be wholly null and void to the extent the Warrant is not exercised
before that time. The Company shall pay all reasonable expenses, taxes and other charges payable in
connection with the preparation, execution and delivery of any certificates or other documents
evidencing the Shares under this §2. Notwithstanding the surrender of the Warrant upon its
exercise, the rights and obligations of the Company and the Holders as set forth in this Warrant
shall continue in full force and effect.

SECTION 3. RESERVATION.

At all times during the Exercise Period, the Company shall reserve and keep available the
maximum number of authorized but unissued Shares, solely for the purpose of issuing, upon the
exercise of the Warrant, a number of Shares equal to the number of Underlying Shares.

SECTION 4. ADJUSTMENT OF NUMBER OF SHARES.

The number of Warrant Shares and the Warrant Price shall be subject to adjustment if the
number of outstanding Shares of Common Stock of the Company shall be increased or decreased as a
result of a stock split, a reverse stock split or similar recapitalization or reclassification of
stock not involving any change in the shareholder’s equity or the aggregate market value of shares
outstanding as a result thereof. The
Warrant Price and number of Shares shall be proportionately adjusted so that the percentage of
the Common Stock acquirable by the Holder upon exercise immediately prior to the event and
immediately following the event remains the same.

 

2

 

SECTION 5. DISSOLUTION OR LIQUIDATION; DIVIDENDS AND DISTRIBUTIONS.

Upon any proposed distribution of the assets of the Company in dissolution or liquidation, the
Company shall mail notice of such distribution to each Holder and shall make no distribution to its
shareholders until the expiration of forty five (45) days from the date of mailing of such notice.
Upon receipt of such notice, each Holder may exercise the Warrant at any time prior to the
expiration of such 45-day period and thereafter receive any distributions made to shareholders of
the Company in connection with such dissolution or liquidation.

SECTION 6. FULLY PAID SHARES; TAXES; FRACTIONAL SHARES.

The Company covenants and agrees that the Warrant Shares will, at the time of delivery upon
the exercise of the Warrant, be validly issued and outstanding and be fully paid and nonassessable.
The Company further covenants and agrees that it will pay when due and payable any and all federal
and state issuance taxes that may be payable in respect of the Warrant or any Warrant Shares or
certificates issued upon the exercise of the Warrant. The Company shall not, however, be required
to pay any tax which may be payable in respect of any Transfer involving a Transfer of Warrant
Shares in the name other than that of a Holder, and any such tax shall be paid by the Holder
requiring such Transfer. Fractional Warrant Shares shall be issued upon the exercise of the Warrant
in any case in which the Underlying Shares are not a whole number and the Holder does not agree to
accept cash in lieu of such fractional Warrant Shares.

SECTION 7. NOTIFICATION OF SHAREHOLDER MATTERS.

Prior to the exercise in full of the Warrant, the Company shall use reasonable efforts to cause any
notice submitted to the shareholders of the Company also to be provided to the Holder, but shall
have no liability to the Holder for failure to provide any such notice with respect to any matters
which are disclosed by the Company to its shareholders or which are available to shareholders
pursuant to the Company’s electronic filings with the Securities and Exchange Commission under the
Securities Exchange Act of 1934.

	SECTION 8.
	 RESTRICTIONS ON TRANSFERABILITY OF WARRANTS AND SHARES; COMPLIANCE WITH LAWS.

8.1. In General. Neither the Warrant nor any Warrant Shares shall be Transferred
except upon the conditions specified in this Warrant, which conditions are intended to insure
compliance with the provisions of the Securities Act (or any similar federal statute at the time in
effect) and any applicable state securities laws in respect of any such Transfer.

 

3

 

8.2. Restrictive Legend. The Warrant Shares shall be represented by certificates,
and, unless otherwise permitted by the provisions of this §8.2, shall be marked with a legend
reading substantially as follows:

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED. THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD,
TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL IN FORM, SUBSTANCE AND SCOPE
REASONABLY ACCEPTABLE TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR UNLESS
SOLD PURSUANT TO RULE 144 UNDER SAID ACT. ANY SUCH SALE, ASSIGNMENT OR TRANSFER MUST ALSO BE MADE
IN COMPLIANCE WITH APPLICABLE STATE SECURITIES LAWS.

If a registration statement covering the Warrant or any Warrant Shares shall become effective under
the Securities Act and under any applicable state securities laws, or if the Company shall receive
an opinion of counsel reasonably satisfactory to the Company (which shall include counsel to the
Company and counsel to the original Holder of the Warrant) that, in the opinion of such counsel,
such legend is not required (including, without limitation, because of the availability of an
exemption afforded by Rule 144(b) under the Securities Act), the Company shall, or shall instruct
its transfer agents and registrars to, remove such legend or issue new Warrants or certificates
without such legend. Upon the reasonable written request of a Holder, the Company shall forthwith
request counsel to render an opinion with respect to the matters covered in this paragraph, and the
Company shall pay all expenses in connection with such matters.

SECTION 9. LOST, STOLEN WARRANTS, ETC.

If the Warrant or any certificates evidencing Warrant Shares shall be mutilated, lost, stolen
or destroyed, the Company shall issue a new Warrant or certificate of like date, tenor and
denomination and deliver the same in exchange and substitution for and upon surrender and
cancellation of the mutilated Warrant or certificate, or in lieu of the Warrant or certificate
lost, stolen or destroyed, upon receipt of evidence reasonably satisfactory to the Company (an
affidavit of the Holder shall be deemed sufficient) of the loss, theft or destruction of such
Warrant or certificate.

SECTION 10. MISCELLANEOUS.

10.1. Holder Not A Shareholder. Except as otherwise specifically provided in this
Warrant, prior to the exercise of the Warrant no Holder shall be entitled to any of the rights of a
shareholder of the Company, including the right as a shareholder to (a) vote or consent or (b)
receive dividends or any other distributions made in respect of Shares.

 

4

 

10.2. Notices. Any notice, demand or delivery to be made pursuant to the provisions
of this Warrant shall be in writing and (a) shall be deemed to have been given or made one day
after the date sent (i) if by the Company, by prepaid overnight delivery addressed to each Holder
at its last known address appearing on the books of the Company maintained for such purpose or (ii)
if by a Holder, by prepaid overnight delivery, addressed to the Company at the Company’s address as
set forth in §2; and (b) if given by courier or confirmed facsimile transmission shall be deemed to
have been made or given when received. Each Holder and the Company may each designate a different
address by notice to the other in the manner provided in this §11.2.

10.3. Successors and Assigns. Subject to all conditions and limitations contained
herein and to the requirements of applicable law, this Warrant and the rights evidenced by the
Warrant shall inure to the benefit of and be binding upon the lawful successors and assigns of the
Company and each Holder. The provisions of this Warrant are intended to be for the benefit of the
Holders of the Warrant or the Warrant Shares and shall be enforceable by the Holders.

10.4. Actions by Holder; Amendments and Waivers. Any provision of this Warrant may be
amended, waived or modified upon the written consent of the Company and the Holder.  Any amendment,
waiver, modification or consent entered into pursuant to this Section 11.4 shall be effective only
in the specific instance and for the specific purpose for which it was given.

10.5. Headings; Severability. The descriptive headings of sections of this Warrant
are provided solely for convenience of reference and shall not, for any purpose, be deemed a part
of this Warrant. Should any part of the Warrant or this Warrant for any reason be declared invalid,
such decision shall not affect the validity of any remaining portion, which shall remain in force
and effect as if the Warrant and this Warrant had been executed with the invalid portion
eliminated. It is the intention of the Company and the Holder that they would have executed and
accepted the remaining portion of the Warrant and this Warrant without including in such remaining
portion any such part, parts or portion which may, for any reason, be hereafter declared invalid.

10.6. Governing Law. The Warrant and this Warrant and all matters concerning the
Warrant and this Warrant shall be governed by the laws of the State of Colorado for contracts
entered into and to be performed in such state without regard to principles of conflicts of laws;
provided however, that with respect to the Company’s internal corporate matters, the laws
of the State of Delaware shall govern.

10.7. Survival of Certain Provisions. Except as otherwise provided, the provisions of
this Warrant shall survive the exercise of the Warrant and shall continue in full force and effect
following such exercise until all Warrant Shares are no longer restricted securities under the
federal securities laws.

 

5

 

10.8. Specific Performance. The Company acknowledges and agrees that the Holders
would be damaged irreparably in the event any of the provisions of this Warrant are not performed
in accordance with their specific terms or otherwise are breached. Accordingly, the Company agrees
that the Holders shall be entitled to an injunction or injunctions to prevent breaches of the
provisions of this Warrant and to enforce specifically this Warrant and the terms and provisions of
this Warrant in any action instituted in any federal or state court in the United States having
jurisdiction over the parties and the matter, in addition to any other remedy to which the Holders
may be entitled, at law or in equity.

10.9. Consent to Jurisdiction. THE COMPANY HEREBY CONSENTS TO THE JURISDICTION OF ANY
STATE OR FEDERAL COURT LOCATED WITHIN THE COUNTY OF DENVER, STATE OF COLORADO AND IRREVOCABLY
AGREES THAT, SUBJECT TO THE HOLDER’S ELECTION, ALL ACTIONS OR PROCEEDINGS ARISING OUT OF OR
RELATING TO THIS WARRANT SHALL BE LITIGATED IN SUCH COURTS. THE COMPANY ACCEPTS FOR ITSELF AND IN
CONNECTION WITH ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF THE
AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS, AND IRREVOCABLY AGREES TO BE BOUND
BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER FINANCING DOCUMENT.
THE COMPANY DESIGNATES AND APPOINTS CHRIS SAPYTA, AND SUCH OTHER PERSON AS MAY HEREAFTER BE
SELECTED BY THE COMPANY WHO IRREVOCABLY AGREES IN WRITING TO SO SERVE AS ITS AGENT TO RECEIVE ON
ITS BEHALF SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDINGS IN ANY SUCH COURT, SUCH SERVICE BEING
HEREBY ACKNOWLEDGED BY THE COMPANY TO BE EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT. A COPY OF
ANY SUCH PROCESS SO SERVED SHALL BE MAILED BY THE HOLDER BY REGISTERED MAIL TO THE COMPANY AT ITS
ADDRESS PROVIDED IN §12.2 AND SHALL BE DEEMED TO HAVE BEEN RECEIVED BY THE COMPANY FIVE (5) DAYS
AFTER BEING SO MAILED. IF ANY AGENT APPOINTED BY THE COMPANY REFUSES TO ACCEPT SERVICE, THE
COMPANY HEREBY AGREES THAT SERVICE UPON IT BY MAIL SHALL CONSTITUTE SUFFICIENT NOTICE. NOTHING IN
THIS WARRANT SHALL AFFECT THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL
LIMIT THE RIGHT OF HOLDER TO BRING PROCEEDINGS AGAINST THE COMPANY IN THE COURTS OF ANY OTHER
JURISDICTION.

10.10. Waiver of Jury Trial. EACH OF THE COMPANY AND THE HOLDER HEREBY WAIVES THE
RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED UPON, ARISING OUT OF, OR IN ANY WAY
RELATING TO: (A) THIS WARRANT, OR (B) ANY OTHER PRESENT OR FUTURE INSTRUMENT OR AGREEMENT BETWEEN
THE HOLDER AND THE COMPANY; OR (C) ANY CONDUCT, ACTS OR OMISSIONS OF THE COMPANY OR THE HOLDER OR
ANY OF THEIR DIRECTORS, MANAGERS, OFFICERS, EMPLOYEES, AGENTS, PARTNERS, REPRESENTATIVES, ATTORNEYS
OR ANY OTHER PERSONS

 

6

 

AFFILIATED WITH THE COMPANY OR THE HOLDER; IN EACH OF THE FOREGOING CASES, WHETHER SOUNDING IN
TORT OR OTHERWISE. EACH OF THE COMPANY AND THE HOLDER ALSO WAIVES ANY BOND OR SURETY OR SECURITY
UPON SUCH BOND WHICH MIGHT, BUT FOR THIS WAIVER, BE REQUIRED. THE SCOPE OF THIS WAIVER IS INTENDED
TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO
THE SUBJECT MATTER OF THIS WARRANT, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS,
AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. EACH OF THE COMPANY AND THE HOLDER ACKNOWLEDGES
THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS
ALREADY RELIED ON THE WAIVER IN ENTERING INTO THIS AGREEMENT AND THAT EACH WILL CONTINUE TO RELY ON
THE WAIVER IN THEIR RELATED FUTURE DEALINGS. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT
BE MODIFIED EITHER ORALLY OR IN WRITING, AND THE WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS WARRANT OR TO ANY OTHER DOCUMENTS OR AGREEMENTS
RELATING TO THE WARRANT. EACH OF THE COMPANY AND THE HOLDER FURTHER WARRANTS AND REPRESENTS THAT
EACH HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL, AND THAT EACH KNOWINGLY AND VOLUNTARILY
WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF
LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

IN WITNESS WHEREOF, this Warrant has been duly executed as of the day and year first above
written.

	 	 	 	 	 
	 

	 	SMART MOVE, INC.	 	 
	 
	 	 	 	 
	 

	 	 

Chris Sapyta
	 	 
	 

	 	President	 	 

	 	 	 	 	 
	Acknowledged and agreed:	 	 
	 
	 	 	 	 
	HOLDER:	 	 
	 
	 	 	 	 
	[Name]	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 
	Name:
	 	 	 	 
	 

	 	 	 	 
	Title:
	 	 	 	 
	 

	 	 	 	 

 

7

 

ELECTION TO EXERCISE WARRANT

TO: Smart Move, Inc.:

The undersigned registered holder of the Warrant, a true and correct copy of which is attached
to this election notice, irrevocably exercises the Warrant and purchases pursuant to such exercise

 _____ 
Shares of the Company, makes payment of

 $
 _____ 
for such Shares, and requests that the
certificates for such Shares be issued in the name of the undersigned holder or its nominee and
delivered to such holder at holder’s address on the books of the Company.

	 	 	 	 	 
	Entity Name (if applicable):	 	 
	 
	 	 	 	 
	 	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 
	Name:
	 	 	 	 
	 

	 	 	 	 
	Title:
	 	 	 	 
	 

	 	 	 	 
	Date:
	 	 	 	 
	 

	 	 	 	 

ASSIGNMENT

FOR VALUE RECEIVED, the undersigned registered holder of the Warrant attached to this
assignment notice, sells, assigns and transfers unto
 _____ 
the Warrant and all rights
evidenced by such Warrant and does irrevocably constitute and irrevocably appoints Corporate Stock
Transfer, Inc. or other duly appointed transfer agent for the securities as the undersigned’s
attorney to transfer such Warrant on the books of the Company.

	 	 	 	 	 
	Entity Name (if applicable):	 	 
	 
	 	 	 	 
	 	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 
	Name:
	 	 	 	 
	 

	 	 	 	 
	Title:
	 	 	 	 
	 

	 	 	 	 
	Date:
	 	 	 	 
	 

	 	 	 	 

 

8

 

Warrant Definitions Schedule

As used in this Warrant, the following terms have the following respective meanings:

“Company” means Smart Move, Inc., a Delaware corporation, and any successor to all or
substantially all of the assets and business of Smart Move, Inc. Unless the context otherwise
indicates, “Company” shall also include all Subsidiaries of the Company.

“Exercise Period” means the period commencing on the First Exercise Date and terminating at
3:00 p.m., Denver time, on the Expiration Date.

“Expiration Date,” with reference to this Warrant, means April 14, 2013.

“First Exercise Date” means the date of original issuance of the Warrant.

“Holder” means a registered holder of the Warrant and, if the context so indicates, the holder
of Shares.

“Securities Act” means the Securities Act of 1933, as amended, or any similar federal statute,
and the rules and regulations under such act, all as the same shall be effect at the time.

“Shares” means, shares of the Company’s common stock, par value $.0001 per share, and stock of
any other class into which such shares may hereafter be changed or reclassified.

“Transfer” means any sale, transfer, issuance, assignment, pledge or other disposition or
conveyance of Shares or the Warrant.

“Underlying Shares” means the Shares issuable upon exercise of the Warrant.

“Warrant” means the Warrant issued on the date of this Warrant to the Holder and any warrant
issued in exchange or substitution for the Warrant.

“Warrant Shares” means the Shares obtained upon exercise of the Warrant.

 

9

 

Exhibit “A”

Pre-2007 Secured Noteholders Receiving

Warrants as Consideration for Release

of Lien Covering 800 Vaults

Aaron Garnett

Ann Fulton SEP IRA

Benjamin Garnett

Bison Capital Limited Partnership

Cal & Amanda Mae Rickel

Cheryl Bennett

Cheryl Bennett Irrev. Trust, Gerald Marrs Trustee

Colin Garnett 

Don Lunnon SEP IRA

Dolo Investment LLC

Duncan-Fredericks Family Foundation EC Armstrong 

Eric Bennett

Frederick & Jayne Esgar

Gary L Schlessman 

Gary L Schlessman Irrev. Trust, Gerald

D Marrs Trustee

Glen and Eleanor Hill TIC

Glen and Eleanor Hill Foundation

Harold and Marjorie Rosen

Margaret Schlessman

Kenneth & Michele Hallock

James E Duncan

Janet Esgar McClure Legacy Trust

Kingdom Enlightenment Scholarship

Lauren Bennett, Lee E. Schlessman 

Nelse Hendricks

Rickel Family Partners LLP

Ruth Ann Esgar

Ruth Ann Esgar Legacy Trust

Sandra Garnett

Sandra Garnett Irrevocable Trust, Gerald D Marrs Trustee

Schlessman Charitable Remainder Trust 

State Bank Wiley Profit Sharing Plan

Susan M. Duncan 

Susan M. Duncan Irrevocable Gift Trust 

Total Secured Debt: Approximately $8 million

2007 Secured Noteholders — Receiving

Warrants as Consideration for Release

of Lien Covering 800 Vaults

EC Armstrong

Susan M. Duncan

Susan M. Duncan

James E Duncan

Susan M. Duncan

Susan M. Duncan

Frederick A. Esgar

Ann Fulton

Jeffery Garrison

Jerry Smith

Nelse & Joyce Hendricks TENCOM

Nelse Hendricks

Rex Hendricks

Estate of Eleanor Hill

Estate of Glenn Hill

Cal Rickel

Cheryl Bennett, Lee Schlessman POA

Sandra Garnett, Lee E. Schlessman POA

Colin Garnett, Lee E. Schlessman POA

Dolores J Schlessman, Lee Schlessman POA

Lee E Schlessman

Total Secured Debt: $1,217,500

 

10

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