Document:

ex4-1.htm

    Exhibit
4.1

     

    THE
SECURITY REPRESENTED HEREBY, AND THE SECURITIES ISSUABLE UPON CONVERSION OR
REDEMPTION HEREOF, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR
ANY STATE SECURITIES LAWS AND NEITHER SUCH SECURITIES NOR ANY INTEREST THEREIN
MAY BE OFFERED, SOLD, TRANSFERRED, ENCUMBERED OR OTHERWISE DISPOSED OF EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT OR SUCH LAWS OR
AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND SUCH LAWS WHICH, IN THE
OPINION OF COUNSEL FOR THE HOLDER, WHICH COUNSEL AND OPINION ARE REASONABLY
SATISFACTORY TO COUNSEL FOR THIS COMPANY, IS AVAILABLE.

    

    

    VEMICS,
INC.

    

    CONVERTIBLE
PROMISSORY NOTE

    BRIDGE
FUNDING

     

     

    
      	 US$________      	
               December 23,
      2008

            

    

     

    FOR VALUE
RECEIVED, Vemics, Inc., a corporation duly organized and validly existing under
the laws of the state of Nevada (the “Company”), promises to pay to
___________________ the
registered holder of this secured convertible promissory note (“Note”) and its successors and
assigns (the “Holder”),
the principal sum of _____________ Thousand Dollars
($____,000) (“Loan
Proceeds”) (see Exhibit “B”) in accordance with the terms hereof, and
interest on the principal sum outstanding in accordance with the terms
hereof.  Accrual of interest on the outstanding principal amount shall
commence on the date hereof and shall continue until payment in full of the
outstanding principal amount has been made or duly provided for, or until the
entire outstanding principal amount of the Note has been converted.

    

    This Note
has been issued pursuant to a subscription agreement executed by the Holder,
dated of even date herewith, in the aggregate principal amount of $_______
(collectively, the “Subscription
Agreement”).  The Loan Proceeds shall be paid to the Company as
follows: (i) $_______ paid by wire transfer immediately following the execution
of this note no later than  December 24, 2008.

    

    The
following is a statement of the rights of the Holder of this Note and the terms
and conditions to which this Note is subject, and to which the Holder, by
acceptance of this Note, agrees:

    

    1. Principal Repayment;
Prepayment.  The outstanding principal amount of this Note and
any and all accrued but unpaid interest thereon shall be payable on or before
June 1, 2009 (the “Maturity
Date”), unless this Note has been converted or redeemed as described
below.  The Company will have the option to extend this note for one
six month period.

    

    2.           Interest.  The
Holder is entitled to receive interest on the outstanding principal amount of
this Note at the rate of Fifteen percent (15.0%) per annum.  Interest
shall be due and payable on the Maturity Date in either cash or stock at the
discretion of the Note holder. The note will carry a liquidation redemption in
addition to the interest due for the time the money is actual being used of 150%
on the redemption of the note. (Example: $____,000 in, Principle +
50%  out, paid at the redemption, plus interest for the time used on
the original principle). Interest and the liquidity percent can be paid in
either cash or stock (at $.05 per share) or any combination

    

    4.           Conversion.

    

    (a)           Optional
Conversion.  From and after the date hereof, Holder may elect,
at its option, to convert all or any portion of the outstanding principal amount
of this Note, and all accrued interest thereon, into shares of common stock of
the Company (“Common Stock”), at the Conversion Price.

    

     

    (b)           Conversion
Price.  For purposes of this Note, the “Conversion Price” shall mean,
with respect to a conversion of the outstanding principal amount of this Note,
plus accrued but unpaid interest thereon, into shares of Common Stock, the price
per share of $.05.

     

    (c)           Mechanics of
Conversion.  Upon any conversion of the outstanding principal
amount of this Note, (i) such principal amount converted shall be converted and
such converted portion of this Note shall become fully paid and satisfied, (ii)
the Holder shall surrender and deliver the original Note, duly endorsed, to the
Company’s office or such other address which the Company shall designate against
delivery of the certificates representing the new securities of the Company;
(iii) the Company shall promptly deliver a duly executed Note to the Holder in
the principal amount, if any, that remains outstanding after any such
conversion; and (iv) in exchange for all or any portion of the surrendered Note
described in clause (ii) of this Section 4(c), the Company shall provide the
Holder with irrevocable instructions addressed to the Company’s transfer and
exchange agent, as applicable, to issue such number of shares of Common
Stock.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (d)          Issue
Taxes.  The Holder shall pay any and all issue and other taxes
that may be payable with respect to any issue or delivery of shares of Common
Stock on conversion of this Note pursuant hereto; provided, however, that the
Holder shall not be obligated to pay any transfer taxes resulting from any
transfer requested by any holder in connection with any such
conversion.

    (e)           Elimination of Fractional
Interests.  No fractional shares of Common Stock shall be
issued upon conversion of this Note, nor shall the Company be required to pay
cash in lieu of fractional interests, it being the intent of the parties that
all fractional interests shall be eliminated and that all issuances of the
Common Stock shall be rounded up to the nearest whole share.

    (f)            Warrants  The
company shall issue a warrant equal to 40% of the principle sum invested
convertible into of common stock at a price of $.05, with five years to
convert.

    

    5.           Redemption.    
The Company may redeem this Note at anytime upon thirty (30) days prior written
notice at a redemption price of 100% of the principal amount of the Note plus
accrued and unpaid interest (including the 50% liquidation redemption). During
such thirty day notice period Holder may convert all or any portion of this Note
in accordance with Section 4 hereof.

    

    6.           Rights upon Liquidation,
Dissolution or Winding Up.  In the event of any liquidation,
dissolution or winding up of the Company, either voluntary or involuntary, the
holders of the Notes shall be entitled to receive, prior and in preference to
any distribution of any of the assets of the Company or to the holders of any
equity security of the Company, an amount equal to the unpaid and unconverted
principal face amount of their Notes and any accrued and unpaid interest
thereon.

    

    7.           Affirmative Covenants of the
Company.  The Company hereby agrees that, so long as the Note
remains outstanding and unpaid, or any other amount is owing to the Holder
hereunder, the Company will:

    

    (a)           Corporate Existence and
Qualification.  Take the necessary steps to preserve its
corporate existence and its right to conduct business in all states in which the
nature of its business requires qualification to do business.

    

    (b)           Books of
Account.  Keep its books of account in accordance with good
accounting practices.

    

    (c)           Insurance.  Maintain
insurance with responsible and reputable insurance companies or associations, as
determined by the Company in its sole but reasonable discretion, in such amounts
and covering such risks as is usually carried by companies engaged in similar
businesses and owning similar properties in the same general areas in which the
Company operates.

    

    (d)           Preservation of Properties;
Compliance with Law.  Maintain and preserve all of its
properties that are used or that are useful in the conduct of its business in
good working order and condition, ordinary wear and tear excepted and comply
with the charter and bylaws or other organizational or governing documents of
the Company, and any law, treaty, rule or regulation, or determination of an
arbitrator or a court or other governmental authority, in each case applicable
to or binding upon the Company or any of its property or to which each the
Company or any of its property is subject.

    

               (e)           Taxes.  Duly pay
and discharge all taxes or other claims, which might become a lien upon any of
its property except to the extent that any thereof are being in good faith
appropriately contested with adequate reserves provided therefor.

    

    (f)           Reservation of
Shares.  The Company shall at all times have authorized, and
reserved for the purpose of issuance, a sufficient number of shares of Common
Stock and issuable upon conversion of this Note and exercise of the Warrants to
provide for the issuance of all of such shares.  Prior to complete
conversion of this Notes and exercise of the Warrants, the Company shall not
reduce the number of shares of Common Stock reserved for issuance hereunder
without the written consent of the Holder except for a reduction proportionate
to a reverse stock split effected for a business purpose other than affecting
the requirements of this Section, which reverse stock split affects all shares
of Common Stock equally.

    

    (g)           Use of
Proceeds.  The proceeds of the Notes will be used for working
capital purposes.

    

    (h)           Financial
Information.  The company shall maintain its filings with the
Securities and Exchange Commission pursuant to Section 13 or Section 15 of the
Exchange Act.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    8.           Negative Covenants of the
Company.  The Company hereby agrees that, so long as all or any
portion of this Note remains outstanding and unpaid it will not, nor will it
permit any of its subsidiaries, if any, without the consent of
the  Holder (as defined in Section 16 hereof), to:

    

    (a)           Indebtedness for Borrowed
Money.  Incur, or permit to exist, any Indebtedness (as defined
below) for borrowed money in excess of $500,000 during each fiscal year of the
Company, with rights superior to Holder, except in the ordinary course of the
Company’s business.  For purposes of this Note, “Indebtedness” shall mean (a)
all obligations of the Company for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of the Company evidenced by bonds,
debentures, notes or other similar instruments, (c) all obligations of the
Company for the deferred purchase price of property or services, except current
accounts payable arising in the ordinary course of business and not overdue
beyond such period as is commercially reasonable for the Company’s business, (d)
all obligations of the Company under conditional sale or other title retention
agreements relating to property purchased by the Company, (e) all payment
obligations of the Company with respect to interest rate or currency protection
agreements, (f) all obligations of the Company as an account party under any
letter of credit or in respect of bankers’ acceptances, (g) all obligations of
any third party secured by property or assets of such Person (regardless of
whether or not the Company is liable for repayment of such obligations), except
for obligations to secure Indebtedness incurred within the limitations of this
Section 8(a); (h) all guarantees of the Company and (i) the redemption price of
all redeemable preferred stock of the Company, but only to the extent that such
stock is redeemable at the option of the holder or requires sinking fund or
similar payments at any time prior to the Maturity Date.

    

    (b)           Mergers, Acquisitions and Sales of
Assets.   Enter into any merger or consolidation or
liquidate, windup or dissolve itself or sell, transfer or lease or otherwise
dispose of all or any substantial part of its assets or technologies (other than
sales of inventory and obsolescent equipment in the ordinary course of
business); except: (i) if the Company is the surviving corporation and a change
in control has not occurred, (ii) that any subsidiary of the Company may merge
into or consolidate with any other subsidiary which is wholly-owned by the
Company, and (iii) any subsidiary which is wholly-owned by the Company may merge
with or consolidate into the Company provided that the Company is the surviving
corporation.

    

    (c)           Loans;  Lend or
advance money, credit or property to (by capital contribution, loan, purchase or
otherwise) any firm, corporation, or other Person except (i) investments in
United States Government obligations, certificates of deposit of any banking
institution with combined capital and surplus of at least $200,000,000; (iii)
accounts receivable arising out of sales in the ordinary course of business; and
(iv) loans to subsidiaries, if any. The Company may enter into an acquisition or
merger deemed beneficial by the board of directors.

    

    (d)           Dividends and
Distributions.  Pay dividends or make any other distribution on
shares of the capital stock of the Company.

    

    (e)           Liens.  Create,
assume or permit to exist, any lien on any of its property or assets now owned
or hereafter acquired except (i) liens in favor of the Holder; (ii) liens
granted to secure Indebtedness incurred within the limitations of Section 8(a)
hereof; (iii) liens incidental to the conduct of its business or the ownership
of its property and assets which were not incurred in connection with the
borrowing of money or the obtaining of advances or credit and which do not
materially impair the use thereof in the operation of its business; (iv) liens
for taxes or other governmental charges which are not delinquent or which are
being contested in good faith and for which a reserve shall have been
established in accordance with generally accepted accounting principles; and (v)
purchase money liens granted to secure the unpaid purchase price of any fixed
assets purchased within the limitations of Section 8(h) hereof.

    

    (f)           Contingent
Liabilities.  Assume, endorse, be or become liable for or
guarantee the obligations of any Person, contingently or otherwise, excluding
however, the endorsement of negotiable instruments for deposit or collection in
the ordinary course of business or guarantees of the Company made within the
limitations of Section 8(a) hereof.

    

    (g)           Sales of Receivables; Sale -
Leasebacks.  Sell, discount or otherwise dispose of notes,
accounts receivable or other obligations owing to the Company, with or without
recourse, except for the purpose of collection in the ordinary course of
business; or sell any asset pursuant to an arrangement to thereafter lease such
asset from the purchaser thereof.

    

    (h)           Capital Expenditures; Capitalized
Leases.  Expend in the aggregate for the Company and all its
subsidiaries in excess of $100,000 in any fiscal year for Capital Expenditures
(as defined below), including payments made on account of Capitalized Leases (as
defined below).  Except as defined in the business plan (Attached as
Exhibit “C”) as part of the operational build out of the company and expansion
of its office and technical infrastructure, which will require Capital
Expenditures and / or Capitalized Leases, for purposes of the foregoing, Capital
Expenditures shall include payments made on account of any deferred purchase
price or on account of any indebtedness incurred to finance any such purchase
price not defined in the business plan as of the date of this
note.  “Capital
Expenditures” shall mean for any period, the aggregate amount of all
payments made by any Person directly or indirectly for the purpose of acquiring,
constructing or maintaining fixed assets, real property or equipment which, in
accordance with generally accepted accounting principles, would be added as a
debit to the fixed asset account of such Person, including, without limitation,
all amounts paid or payable with respect to Capitalized Lease Obligations and
interest which are required to be capitalized in accordance with generally
accepted accounting principles.  “Capitalized Lease” shall mean
any lease the obligations to pay rent or other amounts under which constitute
Capitalized Lease Obligations.  “Capitalized Lease Obligations”
shall mean as to any Person, the obligations of such Person to pay rent or other
amounts under a lease of (or other agreement conveying the right to use) real
and/or personal property which obligations are required to be classified and
accounted for as a capital lease on a balance sheet of such Person under
generally accepted accounting principles and, for purposes of this Note, the
amount of such obligations shall be the capitalized amount thereof, determined
in accordance with generally accepted accounting principles.

    

    (i)           Nature of
Business.  Materially alter the nature of the Company’s
business or otherwise engage in any business other than the business engaged in
or proposed to be engaged in on the date of this Note.

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (j)           Stock of
Subsidiaries.  Sell or otherwise dispose of any subsidiary, if
any, or permit a subsidiary, if any, to issue any additional shares of its
capital stock except pro rata to its stockholders.

    

    (k)           ERISA.  (i)
Terminate any plan (“Plan”) of a type described in
Section 402l(a) of the Employee Retirement Income Security Act of l974, as
amended from time to time (“ERISA”) in respect of which
the Company is an “employer” as defined in Section 3(5) of ERISA so as to result
in any material liability to the Pension Benefit Guaranty Corporation (the
“PBGC”) established
pursuant to Subtitle A of Title IV of ERISA, (ii) engage in or permit any person
to engage in any “prohibited transaction” (as defined in Section 406 of ERISA or
Section 4975 of the Internal Revenue Code of 1954, as amended) involving any
Plan which would subject the Company to any material tax, penalty or other
liability, (iii) incur or suffer to exist any material “accumulated funding
deficiency” (as defined in Section 302 of ERISA), whether or not waived,
involving any Plan, or (iv) allow or suffer to exist any event or condition,
which presents a material risk of incurring a material liability to the PBGC by
reason of termination of any Plan.

    

    (l)           Accounting
Changes.  Make, or permit any subsidiary to make any change in
their accounting treatment or financial reporting practices except as required
or permitted by generally accepted accounting principles in effect from time to
time.

    

    (m)           Transactions with
Affiliates.  Directly or indirectly, purchase, acquire or lease
any property from, or sell, transfer or lease any property to, or enter into any
other transaction, with any Affiliate (as defined below) except in the ordinary
course of business and at prices and on terms not less favorable to it than
those which would have been obtained in an arm’s-length transaction with a
non-affiliated third party.  “Affiliate” as applied to any
Person, shall mean any other Person directly or indirectly through one or more
intermediaries controlling, controlled by, or under common control with, that
Person.  For the purposes of this definition, “control” (including
with correlative meanings, the terms “controlling,” “controlled by” and “under
common control with”), as applied to any Person, means the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of that Person, whether through the ownership of voting securities
or by contract or otherwise.

    

    9.           Events of
Default.  The Note shall become immediately due and payable at
the option of the Holder, without notice or demand, upon any one or more of the
following events or occurrences (“Events of
Default”):

     

    (a)           if
any portion of the Note is not paid when due;

     

    (b)           if
any representation or warranty of the Company made in this Note, the Transaction
Documents (as defined in the Holder Subscription Agreement), or in any
certificate, report or other financial statement or other instrument or document
delivered pursuant hereto, or any notice, certificate, demand or request
delivered to the Holder pursuant to this Note, the Transaction Documents (as
defined in the Holder Subscription Agreement), or any other document proves to
be false or misleading in any material respect as of the time when the same is
made;

     

    (c)           if
the Company consummates a transaction which would cause this Note or any
exercise of any Holder’s rights under this Notes and the Warrants (i) to
constitute a non-exempt prohibited transaction under ERISA, (ii) to violate a
state statute regulating governmental plans or (iii) otherwise to subject the
Company to liability for violation of ERISA or such state statute;

     

    (d)           if
any final judgment for the payment of money is rendered against the Company and
the Company does not discharge the same or cause it to be discharged or vacated
within one hundred twenty (120) days from the entry thereof, or does not appeal
therefrom or from the order, decree or process upon which or pursuant to which
said judgment was granted, based or entered, and does not secure a stay of
execution pending such appeal within one hundred twenty (120) days after the
entry thereof;

     

    (e)           subject
to the provisions of Section 7(f) hereof, if any taxes are not paid before
delinquency;

     

    (f)           if
the Company makes an assignment for the benefit of creditors or if the Company
generally does not pay its debts as they become due;

     

    (g)           if
a receiver, liquidator or trustee of the Company is appointed or if the Company
is adjudicated a bankrupt or insolvent, or if any petition for bankruptcy,
reorganization or arrangement pursuant to federal bankruptcy law, or any similar
federal or state law, is filed by or against, consented to, or acquiesced in, by
the Company or if any proceeding for the dissolution or liquidation of the
Company is instituted; however, if such appointment, adjudication, petition or
proceeding is involuntary and is not consented to by the Company, upon the same
not being discharged, stayed or dismissed within 60 days;

     

    (h)           if
the Company defaults under any other mortgage or security agreement covering any
part of its property;

     

    (i)           except
for specific defaults set forth in this Section 9, if the Company defaults in
the observance or performance of any other term, agreement or condition of this
Note, the Transaction Documents (as defined in the Subscription Agreement), and
the Company fails to remedy such default within thirty (30) days after notice by
the Holder to the Company of such default, or, if such default is of such a
nature that it cannot with due diligence be cured within said thirty (30) day
period, if the Company fails, within said thirty (30) days, to commence all
steps necessary to cure such default, and fails to complete such cure within
ninety (90) days after the end of such thirty (30) day period; and

     

    (j)           if
any of the following exist uncured for forty-five (45) days following written
notice to the Company in any the Transaction Documents (as defined in the
Subscription Agreement): (i) the failure of any representation or warranty made
by the Company to be true and correct in all material respects or (ii) the
Company fails to provide the Holder with the written certifications and evidence
referred to in this Note.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    10.           Holder Not Deemed a
Stockholder.  No Holder, as such, of this Note shall be
entitled (prior to conversion or redemption of this Note into Common Stock, and
only then to the extent of such conversion) to vote or receive dividends or be
deemed the holder of shares of the Company for any purpose, nor shall anything
contained in this Note be construed to confer upon the Holder hereof, as such,
any of the rights at law of a stockholder of the Company prior to the issuance
to the holder of this Note of the shares of Common Stock which the Holder is
then entitled to receive upon the due conversion of all or a portion of this
Note.  Notwithstanding the foregoing, the Company will provide the
Holder with copies of the same notices and other information given to the
stockholders of the Company generally, contemporaneously with the giving thereof
to the stockholders.

    

    11.           Confidential
Information.  The Holder agrees that it will keep confidential
and will not disclose, divulge or use for any purpose, other than to monitor its
investment in the Company, any confidential information obtained from the
Company pursuant to the terms of this Agreement, including without limitation
information provided pursuant to Section 7(h), unless such confidential
information (i) is known or becomes known to the public in general (other than
as a result of a breach of this Section 11 by the Holder), (ii) is or has been
independently developed or conceived by the Holder without use of the Company's
confidential information or (iii) is or has been made known or disclosed to the
Holder by a third party without a breach of any obligation of confidentiality
such third party may have to the Company; provided, however, that the
Holder may disclose confidential information to its attorneys, accountants,
consultants, and other professionals to the extent necessary to obtain their
services in connection with monitoring its investment in the Company or as may
be required by law, provided that the Holder takes reasonable steps to minimize
the extent of any such required disclosure.

    

    12.           Waiver of Demand,
Presentment, Etc.  The Company hereby expressly waives demand
and presentment for payment, notice of nonpayment, protest, notice of protest,
notice of dishonor, default and nonpayment, notice of acceleration or intent to
accelerate, bringing of suit and diligence in taking any action to collect
amounts called for hereunder, and all rights of set-off, defenses, deduction or
counterclaim with respect to any amount owing hereunder, and shall be directly
and primarily liable for the payment of all sums owing and to be owing
hereunder, regardless of and without any notice, diligence, act or omission as
or with respect to the collection of any amount called for
hereunder.

    

    13.           Payment.  Except
as otherwise provided for herein, all payments with respect to this Note shall
be made in lawful currency of the United States of America, at the option of the
Holder, (i) at the principal office of the Holder, located at
_______________________________________________________, or such other place or
places as may be reasonably specified by the Holder of this Note in a written
notice to the Company at least ten (10) business days before a given payment
date, or (ii) by mailing a good check in the proper amount to the Holder at
least two days prior to the due date of each payment or otherwise transferring
funds so as to be received by the Holder on the due date of each such payment;
provided, however, that the
Company shall make payment by wire transfer to an account such Holder may
specify in writing to the Company at least two days prior to the due date of
each payment.  Payment shall be credited first to the accrued interest
then due and payable and the remainder applied to principal.  The
Holder shall keep a record of each payment of principal and interest with
respect thereto.

    

    14.           Assignment.  The
rights and obligations of the Company and the Holder of this Note shall be
binding upon, and inure to the benefit of, the permitted successors, assigns,
heirs, administrators and transferees of the parties
hereto.  Notwithstanding the foregoing, the Holder may not assign,
pledge or otherwise transfer this Note without the prior written consent of the
Company.  Interest and principal are payable only to the registered
Holder of this Note in the Note Register.

    

    15.           Waiver and
Amendment.  Any provision of this Note, including, without
limitation, the due date hereof, and the observance of any term hereof, may be
amended, waived or modified (either generally or in a particular instance and
either retroactively or prospectively) only with the written consent of the
Company and the Holder.

    

    16.           Notices.  Any
notice, request or other communication required or permitted hereunder shall be
in writing and shall be deemed to have been duly given if personally delivered
or mailed by registered or certified mail, postage prepaid, or delivered by
facsimile transmission, to the Company at the address or facsimile number set
forth herein or to the Holder at its address or facsimile number set forth in
the records of the Company.  Any party hereto may by notice so given
change its address for future notice hereunder.  Notice shall
conclusively be deemed to have been given when personally delivered or when
deposited in the mail in the manner set forth above and shall be deemed to have
been received when delivered or, if notice is given by facsimile transmission,
when delivered with confirmation of receipt.

    

    17.           Governing Law;
Jurisdiction.  This Note, and all matters arising directly or
indirectly here from, shall be governed by and construed in accordance with the
laws of the State of New York, notwithstanding the choice of law or conflicts of
law principles thereof.  Each of the parties hereto hereby (i)
irrevocably consents and submits to the sole exclusive jurisdiction of the
United States District Court for the District of New York (and of the
appropriate appellate courts therefrom) in connection with any suit, action or
other proceeding arising out of or relating to this Note, (ii) irrevocably
waives, to the fullest extent permitted by law, any objection that it may now or
hereafter have to the laying of the venue of any such suit, action or proceeding
in any such court or that any such suit, action or proceeding which is brought
in any such court has been brought in an inconvenient forum, and (iii) agrees
that service of any summons, complaint, notice or other process relating to such
suit, action or other proceeding may be effected in the manner provided by
Section 17.

     

    19.           Severability.  If
one or more provisions of this Note are held to be unenforceable under
applicable law, such provisions shall be excluded from this Note, and the
balance of this Note shall be interpreted as if such provisions were so excluded
and shall be enforceable in accordance with its terms.

    

    20.           Headings.  Section
headings in this Note are for convenience only, and shall not be used in the
construction of this Note.

    

    [SIGNATURE
PAGE FOLLOWS]

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    IN WITNESS WHEREOF, the
Company has caused this Note to be issued as of the date first above
written.

    

    

    VEMICS,
INC.

    

    By:  _________________________

    Name:

    Title:ex4-2.htm

    Exhibit 4.2

     

    NEITHER
THIS WARRANT NOR THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THE RIGHTS
DESCRIBED HEREIN HAS BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY STATE SECURITIES LAWS, AND MAY NOT BE SOLD, OFFERED FOR SALE,
PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT IN EFFECT
WITH RESPECT TO THE SECURITIES UNDER SUCH ACT AND IN ACCORDANCE WITH APPLICABLE
STATE SECURITIES LAWS OR PURSUANT TO AN APPLICABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF SUCH ACT AND SUCH LAWS, IN WHICH CASE THE HOLDER
MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE COMPANY AN OPINION OF COUNSEL,
WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH
SECURITIES MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR OTHERWISE TRANSFERRED IN
THE MANNER CONTEMPLATED PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE STATE SECURITIES
LAWS.

    

    COMMON
STOCK PURCHASE WARRANT

    

    To
Purchase _______ Shares of Common Stock of

     

    VEMICS,
INC.

     

    THIS
COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies
that, for value received, _____, an ______ company (the “Holder”), is
entitled, upon the terms and subject to the limitations on exercise and the
conditions hereinafter set forth, at any time on or after the date hereof (the
“Initial Exercise
Date”) and on or prior to the close of business on the five (5) year
anniversary of the Initial Exercise Date (the “Termination Date”)
but not thereafter, to subscribe for and purchase from Vemics, Inc., a Nevada
corporation (the “Company”), up to
_____ shares (the “Warrant Shares”) of
Common Stock, par value $0.001 per share, of the Company (the “Common
Stock”).  The purchase price of one share of Common Stock under
this Warrant shall be equal to the Exercise Price, as defined in Section
2(b).

     

    Section
1.      Definitions.  Capitalized
terms used and not otherwise defined herein shall have the meanings set forth in
that certain Subscription Agreement (the “Subscription
Agreement”), dated _______, among the Company and the subscriber
signatory thereto.

     

    Section
2.      Exercise.

     

    a) Exercise of
Warrant.  Exercise of the purchase rights represented by this
Warrant may be made, in whole or in part, at any time or times on or after the
Initial Exercise Date and on or before the Termination Date by delivery to the
Company of a duly executed facsimile copy of the Notice of Exercise Form annexed
hereto (or such other office or agency of the Company as it may designate by
notice in writing to the registered Holder at the address of such Holder
appearing on the books of the Company); provided, however, within 5
Trading Days of the date said Notice of Exercise is delivered to the Company,
the Holder shall have surrendered this Warrant to the Company and the Company
shall have received  payment of the aggregate Exercise Price of the
shares thereby purchased by wire transfer or cashier’s check drawn on a United
States bank.

     

    b) Exercise
Price.  The exercise price of the Common Stock under this
Warrant shall be $0.05,
subject to adjustment hereunder (the “Exercise
Price”).

     

    (1) Cashless
Exercise.  Any time after the date of issuance of this Warrant, other
than with respect to the Basket Shares, this Warrant may be exercised at such
time by means of a “cashless exercise” in which the Holder shall be entitled to
receive a certificate for the number of Warrant Shares equal to the quotient
obtained by dividing [(A-B) (X)] by (A), where:

     

    (A) = the
Fair Market Value on the trading day immediately preceding the date of such
election;

     

    (B) = the
Exercise Price of this Warrant, as adjusted; and

     

    (X) = the
number of Warrant Shares issuable upon exercise of this Warrant in accordance
with the terms of this Warrant by means of a cash exercise rather than a
cashless exercise.

     

    “Fair
Market Value” means with respect to a share of Common Stock  on any
given date (i) if the Common Stock is listed for trading on a U.S. or foreign
national securities exchanges, the average closing price of the Common Stock for
a period of 5 trading days prior to the Exercise Date; (ii) if the Common Stock
is not listed for trading on a U.S. or foreign national securities exchange but
is traded on the over-the-counter market, the mean of the highest and lowest bid
and ask prices for the Common Stock on the date in question, or, if there are no
such bid and ask prices for the Common Stock on such date, the mean of the
highest and lowest bid and ask prices on the first day prior thereto on which
such prices appear; and (iii) in all other events, such amount as may be
determined by the Board of Directors of the Company  in good faith by
any fair and reasonable means.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
 

    c) Exercise Limitations.
A Holder shall not have the right to exercise any portion of this Warrant,
pursuant to Section 2(c) or otherwise, to the extent that after giving effect to
such issuance after exercise, such Holder (together with such Holder’s
affiliates), as set forth on the applicable Notice of Exercise, would
beneficially own in excess of 4.99% of the number of shares of the Common Stock
outstanding immediately after giving effect to such issuance.  For purposes
of the foregoing sentence, the number of shares of Common Stock beneficially
owned by such Holder and its affiliates shall include the number of shares of
Common Stock issuable upon exercise of this Warrant with respect to which the
determination of such sentence is being made, but shall exclude the number of
shares of Common Stock which would be issuable upon (A) exercise of the
remaining, nonexercised portion of this Warrant beneficially owned by such
Holder or any of its affiliates and (B) exercise of the unexercised portion of
any other securities of the Company (including, without limitation, any other
Warrants) subject to a limitation on exercise analogous to the limitation
contained herein beneficially owned by such Holder or any of its
affiliates.  Except as set forth in the preceding sentence, for purposes of
this Section 2(d), beneficial ownership shall be calculated in accordance with
Section 13(d) of the Exchange Act, it being acknowledged by a Holder that the
Company is not representing to such Holder that such calculation is in
compliance with Section 13(d) of the Exchange Act and such Holder is solely
responsible for any schedules required to be filed in accordance
therewith.   To the extent that the limitation contained in this
Section 2(d) applies, the determination of whether this Warrant is exercisable
(in relation to other securities owned by such Holder) and of which a portion of
this Warrant is exercisable shall be in the sole discretion of a Holder, and the
submission of a Notice of Exercise shall be deemed to be each Holder’s
determination of whether this Warrant is exercisable (in relation to other
securities owned by such Holder) and of which portion of this Warrant is
exercisable, in each case subject to such aggregate percentage limitation, and
the Company shall have no obligation to verify or confirm the accuracy of such
determination.  For purposes of this Section 2(d), in determining the
number of outstanding shares of Common Stock, a Holder may rely on the number of
outstanding shares of Common Stock as reflected in (x) the Subscription
Agreement, (y) a more recent public announcement or public filing by the Company
or (z) any other notice by the Company or the Company’s transfer agent setting
forth the number of shares of Common Stock outstanding.  Upon the written
or oral request of a Holder, the Company shall within five (5) Trading Days
confirm orally and in writing to such Holder the number of shares of Common
Stock then outstanding.  In any case, the number of outstanding shares of
Common Stock shall be determined after giving effect to the conversion or
exercise of securities of the Company, including this Warrant, by such Holder or
its affiliates since the date as of which such number of outstanding shares of
Common Stock was reported.  The provisions of this Section 2(d) may be
waived by such Holder, at the election of such Holder, upon not less than 61
days’ prior notice to the Company, and the provisions of this Section 2(d) shall
continue to apply until such 61st day (or
such later date, as determined by such Holder, as may be specified in such
notice of waiver).

     

    d) Mechanics of
Exercise.

     

    i. Authorization of Warrant
Shares.  The Company covenants that all Warrant Shares which
may be issued upon the exercise of the purchase rights represented by this
Warrant will, upon exercise of the purchase rights represented by this Warrant,
be duly authorized, validly issued, fully paid and nonassessable and free from
all taxes, liens and charges in respect of the issue thereof (other than taxes
in respect of any transfer occurring contemporaneously with such
issue).

     

    ii. Delivery of Certificates
Upon Exercise.  Certificates for shares purchased hereunder
shall be transmitted by the transfer agent of the Company to the Holder by
crediting the account of the Holder’s prime broker with the Depository Trust
Company through its Deposit Withdrawal Agent Commission (“DWAC”) system if the
Company is a participant in such system, and otherwise by physical delivery to
the address specified by the Holder in the Notice of Exercise within fifteen
(15) Trading Days from the delivery to the Company of the Notice of Exercise
Form, surrender of this Warrant and payment of the aggregate Exercise Price as
set forth above (“Warrant Share Delivery
Date”).  This Warrant shall be deemed to have been exercised on
the date the Exercise Price is received by the Company.  The Warrant
Shares shall be deemed to have been issued, and Holder or any other person so
designated to be named therein shall be deemed to have become a holder of record
of such shares for all purposes, as of the date the Warrant has been exercised
by payment to the Company of the Exercise Price and all taxes required to be
paid by the Holder, if any, pursuant to Section 2(d)(v) prior to the issuance of
such shares, have been paid.

     

    iii. Delivery of New Warrants
Upon Exercise.  If this Warrant shall have been exercised in
part, the Company shall, at the time of delivery of the certificate or
certificates representing Warrant Shares, deliver to Holder a new Warrant
evidencing the rights of Holder to purchase the unpurchased Warrant Shares
called for by this Warrant, which new Warrant shall in all other respects be
identical with this Warrant.

     

    iv. No Fractional Shares or
Scrip.  No fractional shares or scrip representing fractional
shares shall be issued upon the exercise of this Warrant.  As to any
fraction of a share which Holder would otherwise be entitled to purchase upon
such exercise, the Company shall pay a cash adjustment in respect of such final
fraction in an amount equal to such fraction multiplied by the Exercise
Price.

     

    v. Charges, Taxes and
Expenses.  Issuance of certificates for Warrant Shares shall be
made without charge to the Holder for any issue or transfer tax or other
incidental expense in respect of the issuance of such certificate, all of which
taxes and expenses shall be paid by the Company, and such certificates shall be
issued in the name of the Holder or in such name or names as may be directed by
the Holder; provided, however, that in the
event certificates for Warrant Shares are to be issued in a name other than the
name of the Holder, this Warrant when surrendered for exercise shall be
accompanied by the Assignment Form attached hereto duly executed by the Holder;
and the Company may require, as a condition thereto, the payment of a sum
sufficient to reimburse it for any transfer tax incidental thereto.

     

    vi. Closing of
Books.  The Company will not close its stockholder books or
records in any manner which prevents the timely exercise of this Warrant,
pursuant to the terms hereof.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Section
3.      Certain Adjustments.

     

    a) Stock Dividends and
Splits. If the Company, at any time while this Warrant is outstanding:
(A) pays a stock dividend or otherwise make a distribution or distributions on
shares of its Common Stock or any other equity or equity equivalent securities
payable in shares of Common Stock (which, for avoidance of doubt, shall not
include any shares of Common Stock issued by the Company pursuant to this
Warrant), (B) subdivides outstanding shares of Common Stock into a larger number
of shares, (C) combines (including by way of reverse stock split) outstanding
shares of Common Stock into a smaller number of shares, or (D) issues by
reclassification of shares of the Common Stock any shares of capital stock of
the Company, then in each case the Exercise Price shall be multiplied by a
fraction of which the numerator shall be the number of shares of Common Stock
(excluding treasury shares, if any) outstanding immediately before such event
and of which the denominator shall be the number of shares of Common Stock
outstanding immediately after such event and the number of shares issuable upon
exercise of this Warrant shall be proportionately adjusted.  Any
adjustment made pursuant to this Section 3(a) shall become effective immediately
after the record date for the determination of stockholders entitled to receive
such dividend or distribution and shall become effective immediately after the
effective date in the case of a subdivision, combination or
re-classification.

     

    b) Subsequent Equity
Sales. If the Company or any Subsidiary thereof, as applicable, at any
time while this Warrant is outstanding, shall offer, sell, grant any option to
purchase or offer, sell or grant any right to reprice its securities, or
otherwise dispose of or issue any Common Stock or Common Stock Equivalents
entitling any Person to acquire shares of Common Stock, at an effective price
per share less than the then Exercise Price (such lower price, the “Base Share Price” and
such issuances collectively, a “Dilutive Issuance”),
as adjusted hereunder (if the holder of the Common Stock so issued shall at any
time, whether by operation of purchase price adjustments, reset provisions,
floating conversion, exercise or exchange prices or otherwise, or due to
warrants, options or rights per share which is issued in connection with such
issuance, be entitled to receive shares of Common Stock at an effective price
per share which is less than the Exercise Price, such issuance shall be deemed
to have occurred for less than the Exercise Price on such date of the adjustment
of the Dilutive Issuance), then, the Exercise Price shall be reduced and only
reduced to equal the Base Share Price and the number of Warrant Shares issuable
hereunder shall be increased such that the aggregate Exercise Price payable
hereunder, after taking into account the decrease in the Exercise Price, shall
be equal to the aggregate Exercise Price prior to such
adjustment.  Such adjustment shall be made whenever such Common Stock
issued.  The Company shall notify the Holder in writing, no later than
the Trading Day following the issuance of any Common Stock, subject to this
section, indicating therein the applicable issuance price, or of applicable
reset price, exchange price, conversion price and other pricing terms (such
notice the “Dilutive
Issuance Notice”).  For purposes of clarification, whether or
not the Company provides a Dilutive Issuance Notice pursuant to this Section
3(b), upon the occurrence of any Dilutive Issuance, after the date of such
Dilutive Issuance the Holder is entitled to receive a number of Warrant Shares
based upon the Base Share Price regardless of whether the Holder accurately
refers to the Base Share Price in the Notice of Exercise.

     

    c) Pro Rata
Distributions.  If the Company, at any time prior to the
Termination Date, shall distribute to all holders of Common Stock (and not to
Holders of the Warrants) evidences of its indebtedness or assets (including cash
and cash dividends) or rights or warrants to subscribe for or purchase any
security other than the Common Stock (which shall be subject to Section 3(b)),
then in each such case the Exercise Price shall be adjusted by multiplying the
Exercise Price in effect immediately prior to the record date fixed for
determination of stockholders entitled to receive such distribution by a
fraction of which the denominator shall be the VWAP determined as of the record
date mentioned above, and of which the numerator shall be such VWAP on such
record date less the then per share fair market value at such record date of the
portion of such assets or evidence of indebtedness so distributed applicable to
one outstanding share of the Common Stock as determined by the Board of
Directors in good faith.  In either case the adjustments shall be
described in a statement provided to the Holder of the portion of assets or
evidences of indebtedness so distributed or such subscription rights applicable
to one share of Common Stock.  Such adjustment shall be made whenever
any such distribution is made and shall become effective immediately after the
record date mentioned above.

     

    d) Fundamental
Transaction. If, at any time while this Warrant is outstanding, (A) the
Company effects any merger or consolidation of the Company with or into another
Person, (B) the Company effects any sale of all or substantially all of its
assets in one or a series of related transactions, (C) any tender offer or
exchange offer (whether by the Company or another Person) is completed pursuant
to which holders of Common Stock are permitted to tender or exchange their
shares for other securities, cash or property, or (D) the Company effects any
reclassification of the Common Stock or any compulsory share exchange pursuant
to which the Common Stock is effectively converted into or exchanged for other
securities, cash or property (in any such case, a “Fundamental
Transaction”), then, upon any subsequent exercise of this Warrant, the
Holder shall have the right to receive, for each Warrant Share that would have
been issuable upon such exercise immediately prior to the occurrence of such
Fundamental Transaction, at the option of the Holder, (a) upon exercise of this
Warrant, the number of shares of Common Stock of the successor or acquiring
corporation or of the Company, if it is the surviving corporation, and any
additional consideration (the “Alternate
Consideration”) receivable upon or as a result of such reorganization,
reclassification, merger, consolidation or disposition of assets by a Holder of
the number of shares of Common Stock for which this Warrant is exercisable
immediately prior to such event or (b) if the Company is acquired in an all cash
transaction, cash equal to the value of this Warrant as determined in accordance
with the Black-Scholes option pricing formula.  For purposes of any
such exercise, the determination of the Exercise Price shall be appropriately
adjusted to apply to such Alternate Consideration based on the amount of
Alternate Consideration issuable in respect of one share of Common Stock in such
Fundamental Transaction, and the Company shall apportion the Exercise Price
among the Alternate Consideration in a reasonable manner reflecting the relative
value of any different components of the Alternate Consideration.  If
holders of Common Stock are given any choice as to the securities, cash or
property to be received in a Fundamental Transaction, then the Holder shall be
given the same choice as to the Alternate Consideration it receives upon any
exercise of this Warrant following such Fundamental Transaction.  To
the extent necessary to effectuate the foregoing provisions, any successor to
the Company or surviving entity in such Fundamental Transaction shall issue to
the Holder a new warrant consistent with the foregoing provisions and evidencing
the Holder’s right to exercise such warrant into Alternate Consideration. The
terms of any agreement pursuant to which a Fundamental Transaction is effected
shall include terms requiring any such successor or surviving entity to comply
with the provisions of this Section 3(d) and insuring that this Warrant (or any
such replacement security) will be similarly adjusted upon any subsequent
transaction analogous to a Fundamental Transaction.

     

    e) Calculations. All
calculations under this Section 3 shall be made to the nearest cent or the
nearest 1/100th of a share, as the case may be. For purposes of this Section 3,
the number of shares of Common Stock deemed to be issued and outstanding as of a
given date shall be the sum of the number of shares of Common Stock (excluding
treasury shares, if any) issued and outstanding.

     

    f) Voluntary Adjustment By
Company. The Company may at any time during the term of this Warrant
reduce the then current Exercise Price to any amount and for any period of time
deemed appropriate by the Board of Directors of the Company.

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    g) Notice to
Holders.

     

    i. Adjustment to Exercise
Price. Whenever the Exercise Price is adjusted pursuant to this Section
3, the Company shall promptly mail to each Holder a notice setting forth the
Exercise Price after such adjustment and setting forth a brief statement of the
facts requiring such adjustment. If the Company issues a variable rate security,
the Company shall be deemed to have issued Common Stock at the lowest possible
exercise price at which such securities may be exercised to the extent
ascertainable at the time of issuance.

     

    ii. Notice to Allow Exercise by
Holder. If (A) the Company shall declare a dividend (or any other
distribution) on the Common Stock; (B) the Company shall authorize the granting
to all holders of the Common Stock rights or warrants to subscribe for or
purchase any shares of capital stock of any class or of any rights; (C) the
approval of any stockholders of the Company shall be required in connection with
any reclassification of the Common Stock, any consolidation or merger to which
the Company is a party, any sale or transfer of all or substantially all of the
assets of the Company, of any compulsory share exchange whereby the Common Stock
is converted into other securities, cash or property; (D) the Company shall
authorize the voluntary or involuntary dissolution, liquidation or winding up of
the affairs of the Company; then, in each case, the Company shall cause to be
mailed to the Holder at its last address as it shall appear upon the Warrant
Register of the Company, at least 20 calendar days prior to the applicable
record or effective date hereinafter specified, a notice stating (x) the date on
which a record is to be taken for the purpose of such dividend, distribution,
redemption, rights or warrants, or if a record is not to be taken, the date as
of which the holders of the Common Stock of record to be entitled to such
dividend, distributions, redemption, rights or warrants are to be determined or
(y) the date on which such reclassification, consolidation, merger, sale,
transfer or share exchange is expected to become effective or close, and the
date as of which it is expected that holders of the Common Stock of record shall
be entitled to exchange their shares of the Common Stock for securities, cash or
other property deliverable upon such reclassification, consolidation, merger,
sale, transfer or share exchange; provided, that the
failure to mail such notice or any defect therein or in the mailing thereof
shall not affect the validity of the corporate action required to be specified
in such notice.  The Holder is entitled to exercise this Warrant
during the 20-day period commencing on the date of such notice to the effective
date of the event triggering such notice.

     

    Section
4.                                Transfer of
Warrant.

     

    a) Transferability.  Subject
to compliance with any applicable securities laws and the conditions set forth
in Sections 5(a) and 4(d) hereof, this Warrant and all rights hereunder are
transferable, in whole or in part, upon surrender of this Warrant at the
principal office of the Company, together with a written assignment of this
Warrant substantially in the form attached hereto duly executed by the Holder or
its agent or attorney and funds sufficient to pay any transfer taxes payable
upon the making of such transfer.  Upon such surrender and, if
required, such payment, the Company shall execute and deliver a new Warrant or
Warrants in the name of the assignee or assignees and in the denomination or
denominations specified in such instrument of assignment, and shall issue to the
assignor a new Warrant evidencing the portion of this Warrant not so assigned,
and this Warrant shall promptly be cancelled.  A Warrant, if properly
assigned, may be exercised by a new holder for the purchase of Warrant Shares
without having a new Warrant issued.

     

    b) New Warrants. This
Warrant may be divided or combined with other Warrants upon presentation hereof
at the aforesaid office of the Company, together with a written notice
specifying the names and denominations in which new Warrants are to be issued,
signed by the Holder or its agent or attorney.  Subject to compliance
with Section 4(a), as to any transfer which may be involved in such division or
combination, the Company shall execute and deliver a new Warrant or Warrants in
exchange for the Warrant or Warrants to be divided or combined in accordance
with such notice.

     

    c) Warrant Register. The
Company shall register this Warrant, upon records to be maintained by the
Company for that purpose (the “Warrant Register”),
in the name of the record Holder hereof from time to time.  The
Company may deem and treat the registered Holder of this Warrant as the absolute
owner hereof for the purpose of any exercise hereof or any distribution to the
Holder, and for all other purposes, absent actual notice to the
contrary.

     

    d) Transfer
Restrictions. If, at the time of the surrender of this Warrant in connection with
any transfer of this Warrant, the transfer of this Warrant shall not be
registered pursuant to an effective registration statement under the Securities Act and under applicable state securities or blue sky laws, the
Company may require, as a condition of allowing such transfer (i) that the
Holder or transferee of this Warrant, as the case may be, furnish to the Company
a written opinion of counsel (which opinion shall be in form, substance and
scope customary for opinions of counsel in comparable transactions) to the
effect that such transfer may be made without registration under the Securities Act and under applicable state securities
or blue sky laws, (ii) that the holder or transferee execute and deliver to the
Company an investment letter in form and substance acceptable to the Company and
(iii) that the transferee be an “accredited
investor” as defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7),
or (a)(8) promulgated under the Securities Act or a qualified institutional
buyer as defined in Rule 144A(a) under the Securities Act.

     

     

    Section
5.                      Redemption.

    

    a) Redemption.  Subject
to Section 5(d) hereof, not less than all of the outstanding Warrants may be
redeemed, at the option of the Company, at any time after they become
exercisable and prior to their expiration, at the office of the Company, upon
the notice referred to in Section 5(b), at the price of $.10 per Warrant (“Redemption Price”),
provided that the last sales price of the Common Stock has been equal to or
greater than $5.25 per share for a period of ten (10) consecutive trading days
prior to the date on which notice of redemption is given.

     

    b) Date Fixed for, and Notice
of, Redemption.  In the event the Company shall elect to redeem
all of the Warrants, the Company shall fix a date for the
redemption.  Notice of redemption shall be mailed by first class mail,
postage prepaid, by the Company not less than 30 days prior to the date fixed
for redemption to the registered holders of the Warrants to be redeemed at their
last addresses as they shall appear on the registration books.  Any
notice mailed in the manner herein provided shall be conclusively presumed to
have been duly given whether or not the registered holder received such
notice.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    c) Exercise After Notice of
Redemption.  The Warrants may be exercised in accordance with
Section 2 of this Agreement at any time after notice of redemption shall have
been given by the Company pursuant to Section 5(b) hereof and prior to the time
and date fixed for redemption.  On and after the redemption date, the
record holder of the Warrants shall have no further rights except to receive,
upon surrender of the Warrants, the Redemption Price.

     

    d) Outstanding Warrants
Only.  The Company understands that the redemption rights
provided for by this Section 5 apply only to outstanding Warrants.  To
the extent a person holds rights to purchase Warrants, such purchase rights
shall not be extinguished by redemption.  However, once such purchase
rights are exercised, the Company may redeem the Warrants issued upon such
exercise provided that the criteria for redemption is met, including the
opportunity of the Warrant holder to exercise prior to redemption pursuant to
Section 5(c).

     

    Section
6.                                Miscellaneous.

     

    a) Title to
Warrant.  Prior to the Termination Date and subject to
compliance with applicable laws and Section 4 of this Warrant, this Warrant and
all rights hereunder are transferable, in whole or in part, at the office or
agency of the Company by the Holder in person or by duly authorized attorney,
upon surrender of this Warrant together with the Assignment Form annexed hereto
properly endorsed.  The transferee shall sign an investment letter in
form and substance reasonably satisfactory to the Company.

     

    b) No Rights as Shareholder
Until Exercise.  This Warrant does not entitle the Holder to
any voting rights or other rights as a shareholder of the Company prior to the
exercise hereof.  Upon the surrender of this Warrant and the payment
of the aggregate Exercise Price (or by means of a cashless exercise), the
Warrant Shares so purchased shall be and be deemed to be issued to such Holder
as the record owner of such shares as of the close of business on the later of
the date of such surrender or payment.

     

    c) Loss, Theft, Destruction or
Mutilation of Warrant. The Company covenants that upon receipt by the
Company of evidence reasonably satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant or any stock certificate relating to
the Warrant Shares, and in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to it (which, in the case of the Warrant, shall
not include the posting of any bond), and upon surrender and cancellation of
such Warrant or stock certificate, if mutilated, the Company will make and
deliver a new Warrant or stock certificate of like tenor and dated as of such
cancellation, in lieu of such Warrant or stock certificate.

     

    d) Saturdays, Sundays,
Holidays, etc.  If the last or appointed day for the taking of
any action or the expiration of any right required or granted herein shall be a
Saturday, Sunday or a legal holiday, then such action may be taken or such right
may be exercised on the next succeeding day not a Saturday, Sunday or legal
holiday.

     

    e) Authorized
Shares.  The Company covenants that during the period the
Warrant is outstanding, it will reserve from its authorized and unissued Common
Stock a sufficient number of shares to provide for the issuance of the Warrant
Shares upon the exercise of any purchase rights under this
Warrant.  The Company further covenants that its issuance of this
Warrant shall constitute full authority to its officers who are charged with the
duty of executing stock certificates to execute and issue the necessary
certificates for the Warrant Shares upon the exercise of the purchase rights
under this Warrant.  The Company will take all such reasonable action
as may be necessary to assure that such Warrant Shares may be issued as provided
herein without violation of any applicable law or regulation, or of any
requirements of the Trading Market upon which the Common Stock may be
listed.

     

    Before
taking any action which would result in an adjustment in the number of Warrant
Shares for which this Warrant is exercisable or in the Exercise Price, the
Company shall obtain all such authorizations or exemptions thereof, or consents
thereto, as may be necessary from any public regulatory body or bodies having
jurisdiction thereof.

     

    f) Registration Rights.
If  at  any  time  after  the  Initial
Exercise Date  and prior to the expiration of this Warrant, the
Company proposes to register any of its common stock or securities convertible
into its common stock (other than in connection with a registration statement on
Form S-4 or Form
S-8),  then  the  Company  shall  notify
the Holder and if so requested by the Holder, will use its best efforts to
register the Holder’s Stock.  Rights to registration under this
Section 6(f) will vest only upon the irrevocable full or partial exercise of
this Warrant and payment of the exercise price pursuant to Section 2. The number
of shares of Warrant Shares of the Holder to be so registered may be limited or
excluded if, in the written opinion of the managing underwriter, registration of
all or any of the shares requested would reasonably adversely effect upon the
proposed public distribution provided any such limitation shall apply ratable to
any other shareholders who have the right to register such shares of Common
Stock in connection with such registration.  The Holder may request
and participate in piggyback registration of its common stock no more than two
times. The Holder’s piggyback registration rights hereunder will rank second to
any other piggyback registration rights of the Company existing on the date
hereof, or created after the date hereof, and the Company will not create any
registration rights which are superior to those of the Holder
hereunder.

     

    g) Jurisdiction. All
questions concerning the construction, validity, enforcement and interpretation
of this Warrant shall be determined in accordance with the provisions of the
Subscription Agreement.

     

    h) Restrictions.  The
Holder acknowledges that the Warrant Shares acquired upon the exercise of this
Warrant, if not registered, will have restrictions upon resale imposed by state
and federal securities laws.

     

    i) Nonwaiver and
Expenses.  No course of dealing or any delay or failure to
exercise any right hereunder on the part of Holder shall operate as a waiver of
such right or otherwise prejudice Holder’s rights, powers or remedies,
notwithstanding the fact that all rights hereunder terminate on the Termination
Date.  If the Company willfully and knowingly fails to comply with any
provision of this Warrant, which results in any material damages to the Holder,
the Company shall pay to Holder such amounts as shall be sufficient to cover any
costs and expenses including, but not limited to, reasonable attorneys’ fees,
including those of appellate proceedings, incurred by Holder in collecting any
amounts due pursuant hereto or in otherwise enforcing any of its rights, powers
or remedies hereunder.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    j) Notices.  Any
notice, request or other document required or permitted to be given or delivered
to the Holder by the Company shall be delivered in accordance with the notice
provisions of the Subscription Agreement.

     

    k) Limitation of
Liability.  No provision hereof, in the absence of any
affirmative action by Holder to exercise this Warrant or purchase Warrant
Shares, and no enumeration herein of the rights or privileges of Holder, shall
give rise to any liability of Holder for the purchase price of any Common Stock
or as a stockholder of the Company, whether such liability is asserted by the
Company or by creditors of the Company.

     

    l) Remedies.  Holder,
in addition to being entitled to exercise all rights granted by law, including
recovery of damages, will be entitled to specific performance of its rights
under this Warrant.  The Company agrees that monetary damages would
not be adequate compensation for any loss incurred by reason of a breach by it
of the provisions of this Warrant and hereby agrees to waive the defense in any
action for specific performance that a remedy at law would be
adequate.

     

    m) Successors and
Assigns.  Subject to applicable securities laws, this Warrant
and the rights and obligations evidenced hereby shall inure to the benefit of
and be binding upon the successors of the Company and the successors and
permitted assigns of Holder.  The provisions of this Warrant are
intended to be for the benefit of all Holders from time to time of this Warrant
and shall be enforceable by any such Holder or holder of Warrant
Shares.

     

    n) Amendment.  This
Warrant may be modified or amended or the provisions hereof waived with the
written consent of the Company and the Holder.

     

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

     

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

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

                IN WITNESS
WHEREOF, the Company has caused this Warrant to be executed by its officer
thereunto duly authorized.

    

    Dated:  __________

    
 

    
      	
              VEMICS,
      INC.

               

               

            
	
              By:__________________________________________

                   Name:

                   Title:

               

            

    

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    NOTICE
OF EXERCISE

    

    TO:           VEMICS,
INC.

    

    (1) The
undersigned hereby elects to purchase ________ Warrant Shares of the Company
pursuant to the terms of the attached Warrant (only if exercised in full), and
tenders herewith payment of the exercise price in full, together with all
applicable transfer taxes, if any.

     

    (2) Payment
shall take the form of (check applicable box):

     

    r in lawful money of
the United States; or

     

    r the cancellation
of such number of Warrant Shares as is necessary, in accordance with the formula
set forth in subsection 2(c), to exercise this Warrant with respect to the
maximum number of Warrant Shares purchasable pursuant to the cashless exercise
procedure set forth in subsection 2(c).

     

    (3) Please
issue a certificate or certificates representing said Warrant Shares in the name
of the undersigned or in such other name as is specified below:

     

    _______________________________

    

    

    The
Warrant Shares shall be delivered to the following:

    

    _______________________________

    

    _______________________________

    

    _______________________________

    

    (4)  Accredited
Investor.  The undersigned is an “accredited investor” as
defined in Regulation D promulgated under the Securities Act of 1933, as
amended.

    

    [SIGNATURE
OF HOLDER]

    

    Name of
Investing Entity:
________________________________________________________________________

    Signature of Authorized Signatory of
Investing Entity:
_________________________________________________

    Name of
Authorized Signatory:
___________________________________________________________________

    Title of
Authorized Signatory:
____________________________________________________________________

    Date:
________________________________________________________________________________________

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    

     

    ASSIGNMENT
FORM

    

    (To
assign the foregoing warrant, execute

    this form
and supply required information.

    Do not
use this form to exercise the warrant.)

    

    

    

    FOR VALUE
RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby
assigned to

     

    

    _______________________________________________
whose address is

    

    _______________________________________________________________.

    

    _______________________________________________________________

    

    Dated:  ______________,
_______

    

    

    Holder’s
Signature:                                         _____________________________

    

    Holder’s
Address:                                           _____________________________

    

     

    

    Signature
Guaranteed:  ___________________________________________

    

    

    NOTE:  The
signature to this Assignment Form must correspond with the name as it appears on
the face of the Warrant, without alteration or enlargement or any change
whatsoever, and must be guaranteed by a bank or trust
company.  Officers of corporations and those acting in a fiduciary or
other representative capacity should file proper evidence of authority to assign
the foregoing Warrant.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00152-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00152-of-00352.parquet"}]]