Document:

[PCF&K Draft of 8/31/99]

THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER APPLICABLE STATE SECURITIES LAWS OR THE ISSUER SHALL HAVE RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE ISSUER THAT REGISTRATION OF SUCH SECURITIES UNDER THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE SECURITIES LAWS IS NOT REQUIRED.

WARRANT TO PURCHASE

SHARES OF COMMON STOCK

OF

DATALOGIC INTERNATIONAL, INC. 

Expires: Upon the Expiration of the Term (as defined herein)

No.: W:_______

Number of Shares: ___________

Date of Issuance: October__, 2006

FOR VALUE RECEIVED, the undersigned, Datalogic International, Inc., a Delaware corporation (together with its successors and assigns, the "Issuer"), hereby certifies that _______________________________ or its registered assigns (the “Holder”)is entitled to subscribe for and purchase, during the Term (as hereinafter defined), up to ____________________________________ (_____________) shares (subject to adjustment as hereinafter provided) of the Common Stock of the Issuer, at an exercise price per share equal to the Warrant Price then in effect, subject, however, to the provisions and upon the terms and conditions hereinafter set forth and as set forth in the Purchase Agreement Capitalized terms used in this Warrant and not otherwise defined herein shall have the respective meanings specified in Section 9 hereof and if not so specified shall have the meanings ascribed to such terms in the Purchase Agreement.

1.

Term.  The term of this Warrant shall commence on October __, 2006 and shall expire at 5:00 p.m., eastern time, on  the date that is the last day of the month in which the third anniversary of the Effective Date (as defined in the Registration Rights Agreement) occurs(such period being the "Term").

2.

Method of Exercise; Payment; Issuance of New Warrant; Transfer and Exchange.

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(a)

Time of Exercise.  The purchase rights represented by this Warrant may be exercised in whole or in part, from time to time, during the Term. 

(b)

Method of Exercise.  The Holder hereof may exercise this Warrant, in whole or in part, by the surrender of this Warrant (with the exercise form attached hereto duly executed) at the principal office of the Issuer, and by the payment to the Issuer of an amount of consideration therefor equal to the Warrant Price in effect on the date of such exercise multiplied by the number of shares of Warrant Stock with respect to which this Warrant is then being exercised, payable at such Holder's election (i) by certified or official bank check or by wire transfer to an account designated by the Issuer, (ii) by "cashless exercise" in accordance with the provisions of subsection (c) of this Section 2, but only when a registration statement under the Securities Act providing for the resale of the Warrant Stock is not then in effect, or (iii) by a combination of the foregoing methods of payment selected by the Holder of this Warrant.

(c)

Cashless Exercise.  Notwithstanding any provisions herein to the contrary and commencing one (1) year following the Original Issue Date if  a registration statement under the Securities Act providing for the resale of the Warrant Stock is not then in effect by the date such registration statement is required to be effective pursuant to the Registration Rights Agreement or not effective at any time during the Effectiveness Period (as defined in the Registration Rights Agreement) in accordance with the terms of the Registration Rights Agreement, in lieu of exercising this Warrant by payment of cash, the Holder may exercise this Warrant by a cashless exercise and shall receive the number of shares of Common Stock equal to an amount (as determined below) by surrender of this Warrant at the principal office of the Issuer together with the properly endorsed Notice of Exercise in which event the Issuer shall issue to the Holder a number of shares of Common Stock computed using the following formula:

X = Y - (A)(Y)

      

      B

Where

X =

the number of shares of Common Stock to be issued to the Holder.

Y =

the number of shares of Common Stock purchasable upon exercise of all of the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being exercised. 

A =

the Warrant Price. 

B =

the Per Share Market Value of one share of Common Stock.

(d)

Issuance of Stock Certificates.  In the event of any exercise of this Warrant in accordance with and subject to the terms and conditions hereof, (i) certificates for the shares of Warrant Stock so purchased shall be dated the date of such exercise and delivered to the Holder hereof within a reasonable time, not exceeding three (3) Trading Days after such exercise (the “Delivery Date”) or, at the request of the Holder (provided that a registration statement under the Securities Act providing for the resale of the Warrant Stock is then in effect), issued and delivered to the Depository Trust Company (“DTC”) account on the Holder’s behalf via the 

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Deposit Withdrawal Agent Commission System (“DWAC”) within a reasonable time, not exceeding three (3) Trading Days after such exercise, and the Holder hereof shall be deemed for all purposes to be the holder of the shares of Warrant Stock so purchased as of the date of such exercise and (ii) unless this Warrant has expired, a new Warrant representing the number of shares of Warrant Stock, if any, with respect to which this Warrant shall not then have been exercised (less any amount thereof which shall have been canceled in payment or partial payment of the Warrant Price as hereinabove provided) shall also be issued to the Holder hereof at the Issuer's expense within such time. 

(e)

Compensation for Buy-In on Failure to Timely Deliver Certificates Upon Exercise.  

(1) In addition to any other rights available to the Holder, if the Issuer fails to cause its transfer agent to transmit to the Holder a certificate or certificates representing the Warrant Stock pursuant to an exercise on or before the day that is five days following the Delivery Date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Stock which the Holder anticipated receiving upon such exercise (a “Buy-In”), then the Issuer shall (1) pay in cash to the Holder the amount by which (x) the Holder’s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (A) the number of shares of Warrant Stock that the Issuer was required to deliver to the Holder in connection with the exercise at issue times (B) the price at which the sell order giving rise to such purchase obligation was executed, and (2) at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of shares of Warrant Stock for which such exercise was not honored or deliver to the Holder the number of shares of Common Stock that would have been issued had the Issuer timely complied with its exercise and delivery obligations hereunder.  For example, if the Holder purchases Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of shares of Common Stock with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (1) of the immediately preceding sentence the Issuer shall be required to pay the Holder $1,000. The Holder shall provide the Issuer written notice indicating the amounts payable to the Holder including costs and expenses, in respect of the Buy-In, together with applicable confirmations and other evidence reasonably requested by the Issuer.  Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Issuer’s failure to timely deliver certificates representing shares of Common Stock upon exercise of this Warrant as required pursuant to the terms hereof.

(2) In addition to any other rights available to the Holder, if the Issuer fails to cause its transfer agent to transmit to the Holder a certificate or certificates representing the Warrant Stock pursuant to an exercise on or before the Delivery Date, and if such delivery is made more than two additional Trading Days after the Delivery Date (the “Late Date”) the Issuer will pay to the Holder cash compensation as follows per each Ten Thousand Dollars ($10,000) of Exercise Price: (i) for each of the ten Trading Days starting with the Late Date, an amount equal to One 

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Hundred Dollars ($100); and (ii) for each day that is more than ten Trading Days following the Delivery Date, an amount equal to Two Hundred Dollars ($200). 

(3) The Warrant Stock 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 Issuer of the Exercise Price and all taxes required to be paid by the Holder, if any.  If the Issuer fails to deliver to the Holder a certificate or certificates representing the Warrant Stock pursuant by the tenth Trading Day following the Delivery Date, then the Holder will have the right to rescind such exercise notwithstanding its other rights and remedies with respect to the same. 

(f)

Transferability of Warrant.  Subject to Section 2(h), this Warrant may be transferred by a Holder without the consent of the Issuer.  If transferred pursuant to this paragraph, this Warrant may be transferred on the books of the Issuer by the Holder hereof in person or by duly authorized attorney, upon surrender of this Warrant at the principal office of the Issuer, properly endorsed (by the Holder executing an assignment in the form attached hereto) and upon payment of any necessary transfer tax or other governmental charge imposed upon such transfer.  This Warrant is exchangeable at the principal office of the Issuer for Warrants to purchase the same aggregate number of shares of Warrant Stock, each new Warrant to represent the right to purchase such number of shares of Warrant Stock as the Holder hereof shall designate at the time of such exchange.  All Warrants issued on transfers or exchanges shall be dated the Original Issue Date and shall be identical with this Warrant except as to the number of shares of Warrant Stock issuable pursuant thereto.

(g)

Continuing Rights of Holder.  The Issuer will, at the time of or at any time after each exercise of this Warrant, upon the request of the Holder hereof, acknowledge in writing the extent, if any, of its continuing obligation to afford to such Holder all rights to which such Holder shall continue to be entitled after such exercise in accordance with the terms of this Warrant, provided that if any such Holder shall fail to make any such request, the failure shall not affect the continuing obligation of the Issuer to afford such rights to such Holder.

(h)

Compliance with Securities Laws.

(i)

The Holder of this Warrant, by acceptance hereof, acknowledges that this Warrant and the shares of Warrant Stock to be issued upon exercise hereof are being acquired solely for the Holder's own account and not as a nominee for any other party, and for investment, and that the Holder will not offer, sell or otherwise dispose of this Warrant or any shares of Warrant Stock to be issued upon exercise hereof except pursuant to an effective registration statement, or an exemption from registration, under the Securities Act and any applicable state securities laws.

(ii)

Except as provided in paragraph (iii) below, this Warrant and all certificates representing shares of Warrant Stock issued upon exercise hereof shall be stamped or imprinted with a legend in substantially the following form:

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THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER APPLICABLE STATE SECURITIES LAWS OR THE ISSUER SHALL HAVE RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE ISSUER THAT REGISTRATION OF SUCH SECURITIES UNDER THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE SECURITIES LAWS IS NOT REQUIRED.

(iii)

The Issuer agrees to reissue this Warrant or certificates representing any of the Warrant Stock, without the legend set forth above if at such time, prior to making any transfer of any such securities, the Holder shall give written notice to the Issuer describing the manner and terms of such transfer.  Such proposed transfer will not be effected until: (a) either (i) the Issuer has received an opinion of counsel reasonably satisfactory to the Issuer, to the effect that the registration of such securities under the Securities Act is not required in connection with such proposed transfer, (ii) a registration statement under the Securities Act covering such proposed disposition has been filed by the Issuer with the Securities and Exchange Commission and has become effective under the Securities Act, (iii) the Issuer has received other evidence reasonably satisfactory to the Issuer that such registration and qualification under the Securities Act and state securities laws are not required (which may include an opinion of counsel provided by the Issuer), or (iv) the Holder provides the Issuer with reasonable assurances that such security can be sold pursuant to Rule 144 under the Securities Act (which may include an opinion of counsel provided by the Issuer); and (b) either (i) the Issuer has received an opinion of counsel reasonably satisfactory to the Issuer, to the effect that registration or qualification under the securities or "blue sky" laws of any state is not required in connection with such proposed disposition, or (ii) compliance with applicable state securities or "blue sky" laws has been effected or a valid exemption exists with respect thereto (which may include an opinion of counsel provided by the Issuer).  The Issuer will respond to any such notice from a holder within three (3) business days.  In the case of any proposed transfer under this Section 2(h), the Issuer will use reasonable efforts to comply with any such applicable state securities or "blue sky" laws, but shall in no event be required, (x) to qualify to do business in any state where it is not then qualified, (y) to take any action that would subject it to tax or to the general service of process in any state where it is not then subject, or (z) to comply with state securities or “blue sky” laws of any state for which registration by coordination is unavailable to the Issuer.  The restrictions on transfer contained in this Section 2(h) shall be in addition to, and not by way of limitation of, any other restrictions on transfer contained in any other section of this Warrant.  Whenever a certificate representing the Warrant Stock is required to be issued to a the Holder without a legend, in lieu of delivering physical certificates 

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representing the Warrant Stock, provided the Issuer’s transfer agent is participating in the DTC Fast Automated Securities Transfer program, the Issuer shall use its reasonable best efforts to cause its transfer agent to electronically transmit the Warrant Stock to the Holder by crediting the account of the Holder's Prime Broker with DTC through its DWAC system (to the extent not inconsistent with any provisions of this Warrant or the Purchase Agreement).  

(i)

Accredited Investor Status.  In no event may the Holder exercise this Warrant in whole or in part unless the Holder is an “accredited investor” as defined in Regulation D under the Securities Act.  

3.

Stock Fully Paid; Reservation and Listing of Shares; Covenants.

(a)

Stock Fully Paid.  The Issuer represents, warrants, covenants and agrees that all shares of Warrant Stock which may be issued upon the exercise of this Warrant or otherwise hereunder will, when issued in accordance with the terms of this Warrant, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens and charges created by or through the Issuer.  The Issuer further covenants and agrees that during the period within which this Warrant may be exercised, the Issuer will at all times have authorized and reserved for the purpose of issuance upon exercise of this Warrant a number of shares of Common Stock equal to at least one hundred twenty percent (120%) of the aggregate number of shares of Common Stock to provide for the exercise of this Warrant.

(b)

Reservation.  If any shares of Common Stock required to be reserved for issuance upon exercise of this Warrant or as otherwise provided hereunder require registration or qualification with any governmental authority under any federal or state law before such shares may be so issued, the Issuer will use its reasonable best efforts as expeditiously as possible at its expense to cause such shares to be duly registered or qualified.  If the Issuer shall list any shares of Common Stock on any securities exchange or market it will, at its expense, list thereon, maintain and increase when necessary such listing, of, all shares of Warrant Stock from time to time issued upon exercise of this Warrant or as otherwise provided hereunder (provided that such Warrant Stock has been registered pursuant to a registration statement under the Securities Act then in effect), and, to the extent permissible under the applicable securities exchange rules, all unissued shares of Warrant Stock which are at any time issuable hereunder, so long as any shares of Common Stock shall be so listed.  The Issuer will also so list on each securities exchange or market, and will maintain such listing of, any other securities which the Holder of this Warrant shall be entitled to receive upon the exercise of this Warrant if at the time any securities of the same class shall be listed on such securities exchange or market by the Issuer.

(c)

Covenants.  The Issuer shall not by any action including, without limitation, amending the Certificate of Incorporation or the by-laws of the Issuer, or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of the Holder hereof against dilution (to the extent specifically provided herein) or impairment.  Without 

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limiting the generality of the foregoing, the Issuer will (i) not permit the par value, if any, of its Common Stock to exceed the then effective Warrant Price, (ii) not amend or modify any provision of the Certificate of Incorporation or by-laws of the Issuer in any manner that would adversely affect the rights of the Holders of the Warrants, (iii) take all such action as may be reasonably necessary in order that the Issuer may validly and legally issue fully paid and nonassessable shares of Common Stock, free and clear of any liens, claims, encumbrances and restrictions (other than as provided herein) created by the Issuer upon the exercise of this Warrant, and (iv) use its reasonable best efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof as may be reasonably necessary to enable the Issuer to perform its obligations under this Warrant.

(d)

Loss, Theft, Destruction of Warrants.  Upon receipt of evidence satisfactory to the Issuer of the ownership of and the loss, theft, destruction or mutilation of any Warrant and, in the case of any such loss, theft or destruction, upon receipt of indemnity or security satisfactory to the Issuer or, in the case of any such mutilation, upon surrender and cancellation of such Warrant, the Issuer will make and deliver, in lieu of such lost, stolen, destroyed or mutilated Warrant, a new Warrant of like tenor and representing the right to purchase the same number of shares of Common Stock.

4.

Adjustment of Warrant Price.  The price at which such shares of Warrant Stock may be purchased upon exercise of this Warrant shall be subject to adjustment from time to time as set forth in this Section 4 and as set forth in the Purchase Agreement. The Issuer shall give the Holder notice of any event described below which requires an adjustment pursuant to this Section 4 in accordance with the notice provisions set forth in Section 5.

(a)

Recapitalization, Reorganization, Reclassification, Consolidation, Merger or Sale.

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(i)  In case the Issuer after the Original Issue Date shall do any of the following (each, a "Triggering Event"): (a) consolidate or merge with or into any other Person and the Issuer shall not be the continuing or surviving corporation of such consolidation or merger, or (b) permit any other Person to consolidate with or merge into the Issuer and the Issuer shall be the continuing or surviving Person but, in connection with such consolidation or merger, any Capital Stock of the Issuer shall be changed into or exchanged for Securities of any other Person or cash or any other property, or (c) transfer all or substantially all of its properties or assets to any other Person, or (d) effect a capital reorganization or reclassification of its Capital Stock, then, and in the case of each such Triggering Event, proper provision shall be made so that, upon the basis and the terms and in the manner provided in this Warrant, the Holder of this Warrant shall be entitled upon the exercise hereof at any time after the consummation of such Triggering Event, to the extent this Warrant is not exercised prior to such Triggering Event, to receive at the Warrant Price in effect at the time immediately prior to the consummation of such Triggering Event in lieu of the Common Stock issuable upon such exercise of this Warrant prior to such Triggering Event, the Securities, cash and property to which such Holder would have been entitled upon the consummation of such Triggering Event if such Holder had exercised the rights represented by this Warrant immediately prior thereto (including the right of a shareholder to elect the type of consideration it will receive upon a Triggering Event), subject to adjustments (subsequent to such corporate action) as nearly equivalent as possible to the adjustments provided for elsewhere in this Section 4.  Notwithstanding the foregoing to the contrary, this Section 4(a)(i) shall only apply if the surviving entity pursuant to any such Triggering Event is a company has a class of equity securities registered pursuant to the Securities Exchange Act of 1934, as amended, and its common stock is listed or quoted on a national securities exchange, national automated quotation system or the OTC Bulletin Board.  In the event that the surviving entity pursuant to any such Triggering Event is not a company that has a class of equity securities registered pursuant to the Securities Exchange Act of 1934, as amended, or its common stock is not listed or quoted on a national securities exchange, national automated quotation system or the OTC Bulletin Board, then the Holder shall have the right to demand that the Issuer pay to the Holder an amount equal to the value of this Warrant according to the Black-Scholes formula.

(ii)

Notwithstanding anything contained in this Warrant to the contrary and so long as the surviving entity pursuant to any Triggering Event is a company that has a class of equity securities registered pursuant to the Securities Exchange Act of 1934, as amended, and its common stock is listed or quoted on a national securities exchange, national automated quotation system or the OTC Bulletin Board, a Triggering Event shall not be deemed to have occurred if, prior to the consummation thereof, each Person (other than the Issuer) which may be required to deliver any Securities, cash or property upon the exercise of this Warrant as provided herein shall assume, by written instrument delivered to, and reasonably satisfactory to, the Holder of this Warrant, (A) the obligations of the Issuer under this Warrant (and if the Issuer shall survive the consummation of such Triggering Event, such assumption shall be in addition to, and shall not release the Issuer from, any continuing obligations of the Issuer under this Warrant) and (B) the obligation to deliver to such Holder such Securities, cash or 

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property as, in accordance with the foregoing provisions of this subsection (a), such Holder shall be entitled to receive, and such Person shall have similarly delivered to such Holder an opinion of counsel for such Person, which counsel shall be reasonably satisfactory to such Holder, or in the alternative, a written acknowledgement executed by the President or Chief Financial Officer of the Issuer, stating that this Warrant shall thereafter continue in full force and effect and the terms hereof (including, without limitation, all of the provisions of this subsection (a)) shall be applicable to the Securities, cash or property which such Person may be required to deliver upon any exercise of this Warrant or the exercise of any rights pursuant hereto. 

(b)

Stock Dividends, Subdivisions and Combinations.  If at any time the Issuer shall:

 

(i)

make or issue or set a record date for the holders of the Common Stock for the purpose of entitling them to receive a dividend payable in, or other distribution of, shares of Common Stock, 

 

(ii) 

subdivide its outstanding shares of Common Stock into a larger number of shares of Common Stock, or

 

(iii) 

combine its outstanding shares of Common Stock into a smaller number of shares of Common Stock,

then (1) the number of shares of Common Stock for which this Warrant is exercisable immediately after the occurrence of any such event shall be adjusted to equal the number of shares of Common Stock which a record holder of the same number of shares of Common Stock for which this Warrant is exercisable immediately prior to the occurrence of such event would own or be entitled to receive after the happening of such event, and (2) the Warrant Price then in effect shall be adjusted to equal (A) the Warrant Price then in effect multiplied by the number of shares of Common Stock for which this Warrant is exercisable immediately prior to the adjustment divided by (B) the number of shares of Common Stock for which this Warrant is exercisable immediately after such adjustment.

(c)

Certain Other Distributions.  If at any time the Issuer shall make or issue or set a record date for the holders of the Common Stock for the purpose of entitling them to receive any divi­dend or other distribution of:

(i)

cash (other than a cash dividend payable out of earnings or earned surplus legally available for the payment of dividends under the laws of the jurisdiction of incorporation of the Issuer),

(ii)

any evidences of its indebtedness, any shares of stock of any class or any other securities or property of any nature whatsoever (other than cash, Common Stock Equivalents or Additional Shares of Common Stock), or

(iii)

any warrants or other rights to subscribe for or purchase any 

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evidences of its indebtedness, any shares of stock of any class or any other securities or property of any nature whatsoever (other than cash, Common Stock Equivalents or Additional Shares of Common Stock), 

then (1) the number of shares of Common Stock for which this Warrant is exercisable shall be adjusted to equal the product of the number of shares of Common Stock for which this Warrant is exercisable immediately prior to such adjustment multiplied by a fraction (A) the numerator of which shall be the Per Share Market Value of Common Stock at the date of taking such record and (B) the denominator of which shall be such Per Share Market Value minus the amount allocable to one share of Common Stock of any such cash so distributable and of the fair value (as determined in good faith by the Board of Directors of the Issuer and supported by an opinion from an investment banking firm mutually agreed upon by the Issuer and the Holder) of any and all such evidences of indebtedness, shares of stock, other securities or property or warrants or other subscription or purchase rights so distributable, and (2) the Warrant Price then in effect shall be adjusted to equal (A) the Warrant Price then in effect multiplied by the number of shares of Common Stock for which this Warrant is exercisable immediately prior to the adjustment divided by (B) the number of shares of Common Stock for which this Warrant is exercisable immediately after such adjustment.  A reclassification of the Common Stock (other than a change in par value, or from par value to no par value or from no par value to par value) into shares of Common Stock and shares of any other class of stock shall be deemed a distribution by the Issuer to the holders of its Common Stock of such shares of such other class of stock within the meaning of this Section 4(c) and, if the outstanding shares of Common Stock shall be changed into a larger or smaller number of shares of Common Stock as a part of such reclassification, such change shall be deemed a subdivision or combination, as the case may be, of the outstanding shares of Common Stock within the meaning of Section 4(b).  

(d)

Issuance of Additional Shares of Common Stock.  In the event the Issuer shall at any time following the Original Issue Date issue any Additional Shares of Common Stock (otherwise than as provided in the foregoing subsections (b) through (c) of this Section 4), at a price per share less than the Warrant Price then in effect or without consideration, then the Warrant Price upon each such issuance shall be adjusted to the price equal to the consideration per share paid for such Additional Shares of Common Stock.

(e)  

Issuance of Common Stock Equivalents.  If at any time the Issuer shall take a record of the holders of its Common Stock for the purpose of entitling them to receive a distribution of, or shall in any manner (whether directly or by assumption in a merger in which the Issuer is the surviving corporation) issue or sell, any Common Stock Equivalents, whether or not the rights to exchange or convert thereunder are immediately exercisable, and the price per share for which Common Stock is issuable upon such conversion or exchange shall be less than the Warrant Price in effect immediately prior to the time of such issue or sale, or if, after any such issuance of Common Stock Equivalents, the price per share for which Additional Shares of Common Stock may be issuable thereafter is amended or adjusted, and such price as so amended shall make be less than the Warrant Price in effect at the time of such amendment or adjustment, then the Warrant Price then in effect shall be adjusted as provided in Section 4(d).  No further adjustments of the number of shares of Common Stock for which this Warrant is exercisable and the Warrant Price then in effect shall be made upon the actual issue of such Common Stock upon 

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conversion or exchange of such Common Stock Equivalents.

(f)

Other Provisions applicable to Adjustments under this Section.  The following provisions shall be ap­plicable to the making of adjustments of the number of shares of Common Stock for which this Warrant is exercisable and the Warrant Price then in effect provided for in this Section 4:

(i)

Computation of Consideration.  To the extent that any Additional Shares of Common Stock or any Common Stock Equivalents (or any warrants or other rights therefor) shall be issued for cash consideration, the consideration received by the Issuer therefor shall be the amount of the cash received by the Issuer therefor, or, if such Additional Shares of Common Stock or Common Stock Equivalents are offered by the Issuer for subscription, the subscription price, or, if such Additional Shares of Common Stock or Common Stock Equivalents are sold to underwriters or dealers for public offering without a subscription offering, the initial public offering price (in any such case subtracting any amounts paid or receivable for accrued interest or accrued dividends and without taking into account any compensation, discounts or expenses paid or incurred by the Issuer for and in the underwriting of, or otherwise in connection with, the issuance thereof).  In connection with any merger or consolidation in which the Issuer is the surviving corporation (other than any consolidation or merger in which the previously outstanding shares of Common Stock of the Issuer shall be changed to or exchanged for the stock or other securities of another corporation), the amount of consideration therefore shall be, deemed to be the fair value of such portion of the assets and business of the nonsurviving corporation as the Board may determine to be attributable to such shares of Common Stock or Common Stock Equivalents, as the case may be.  Such determination of the fair value of such consideration shall be made by an Independent Appraiser.  The consideration for any Additional Shares of Common Stock issuable pursuant to the terms of any Common Stock Equivalents shall be the consideration received by the Issuer for issuing such Common Stock Equivalents, plus the additional consideration, if any, payable to the Issuer upon the exercise of the right of conversion or exchange in such Common Stock Equivalents.  In the event of any consolidation or merger of the Issuer in which the Issuer is not the surviving corporation or in which the previously outstanding shares of Common Stock of the Issuer shall be changed into or exchanged for the stock or other securities of another corporation, or in the event of any sale of all or substantially all of the assets of the Issuer for stock or other securities of any corporation, the Issuer shall be deemed to have issued a number of shares of its Common Stock for stock or securities or other property of the other corporation computed on the basis of the actual exchange ratio on which the transaction was predicated, and for a consideration equal to the fair market value on the date of such transaction of all such stock or securities or other property of the other corporation.  In the event any consideration received by the Issuer for any securities consists of property other than cash, the fair market value thereof at the time of issuance or as otherwise applicable shall be as determined in good faith by the Board.  In the event Common Stock is issued with other shares or securities or other assets of the Issuer for consideration which covers both, the consideration computed as provided in this Section 4(f)(i) shall be allocated among such securities and assets as determined in good faith by the Board.

(ii)

When Adjustments to Be Made.  The adjustments required by this Section 4 shall be made whenever and as often as any specified event requiring an adjustment shall 

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occur, except that any adjustment of the number of shares of Common Stock for which this Warrant is exercisable that would otherwise be required may be postponed (except in the case of a subdivision or combination of shares of the Common Stock, as provided for in Section 4(b)) up to, but not beyond the date of exercise if such adjustment either by itself or with other adjustments not previously made adds or subtracts less than one percent (1%) of the shares of Common Stock for which this Warrant is exercisable immediately prior to the making of such adjustment.  Any adjustment representing a change of less than such minimum amount (except as aforesaid) which is postponed shall be carried forward and made as soon as such adjustment, together with other adjustments required by this Section 4 and not previously made, would result in a minimum adjustment or on the date of exercise. For the purpose of any adjustment, any specified event shall be deemed to have occurred at the close of business on the date of its occurrence.

(iii)

Fractional Interests.  In computing ad­justments under this Section 4, fractional interests in Common Stock shall be taken into account to the near­est one one-hundredth (1/100th) of a share.

(iv)

When Adjustment Not Required.  If the Issuer shall take a record of the holders of its Common Stock for the purpose of entitling them to receive a dividend or distribution or subscription or purchase rights and shall, thereafter and before the distribution to stockholders thereof, legally abandon its plan to pay or deliver such dividend, distribution, subscription or purchase rights, then thereafter no adjustment shall be required by reason of the taking of such record and any such adjustment previously made in respect thereof shall be rescinded and annulled.

(g)

Form of Warrant after Adjustments.  The form of this Warrant need not be changed because of any adjustments in the Warrant Price or the number and kind of Securities purchasable upon the exercise of this Warrant.

(h)

Escrow of Warrant Stock.  If after any property becomes distributable pursuant to this Section 4 by reason of the taking of any record of the holders of Common Stock, but prior to the occurrence of the event for which such record is taken, and the Holder exer­cises this Warrant, any shares of Common Stock issuable upon exercise by reason of such adjustment shall be deemed the last shares of Common Stock for which this Warrant is exercised (notwithstanding any other provision to the contrary herein) and such shares or other property shall be held in escrow for the Holder by the Issuer to be issued to the Holder upon and to the extent that the event actually takes place, upon payment of the current Warrant Price.  Notwithstanding any other provision to the contrary herein, if the event for which such record was taken fails to occur or is rescinded, then such escrowed shares shall be cancelled by the Issuer and escrowed property returned.

5.

Notice of Adjustments.  Whenever the Warrant Price or Warrant Share Number shall be adjusted pursuant to Section 4 hereof (for purposes of this Section 5, each an "adjustment"), the Issuer shall cause its Chief Financial Officer to prepare and execute a certificate setting forth, in reasonable detail, the event requiring the adjustment, the amount of the adjustment, the method by which such adjustment was calculated (including a description of 

-12-

 

the basis on which the Board made any determination hereunder), and the Warrant Price and Warrant Share Number after giving effect to such adjustment, and shall cause copies of such certificate to be delivered to the Holder of this Warrant promptly after each adjustment.  Any dispute between the Issuer and the Holder of this Warrant with respect to the matters set forth in such certificate may at the option of the Holder of this Warrant be submitted to a national or regional accounting firm reasonably acceptable to the Issuer and the Holder, provided that the Issuer shall have ten (10) days after receipt of notice from such Holder of its selection of such firm to object thereto, in which case such Holder shall select another such firm and the Issuer shall have no such right of objection.  The firm selected by the Holder of this Warrant as provided in the preceding sentence shall be instructed to deliver a written opinion as to such matters to the Issuer and such Holder within thirty (30) days after submission to it of such dispute.  Such opinion shall be final and binding on the parties hereto.  The costs and expenses of the initial accounting firm shall be paid equally by the Issuer and the Holder and, in the case of an objection by the Issuer, the costs and expenses of the subsequent accounting firm shall be paid in full by the Issuer.

6.

Fractional Shares.  No fractional shares of Warrant Stock will be issued in connection with any exercise hereof, but in lieu of such fractional shares, the Issuer shall make a cash payment therefor equal in amount to the product of the applicable fraction multiplied by the Per Share Market Value then in effect.

7.

Ownership Cap and Certain Exercise Restrictions.  Notwithstanding anything to the contrary set forth in this Warrant, at no time may a Holder of this Warrant exercise this Warrant if the number of shares of Common Stock to be issued pursuant to such exercise would exceed, when aggregated with all other shares of Common Stock owned by such Holder at such time, the number of shares of Common Stock which would result in such Holder beneficially owning (as determined in accordance with Section 13(d) of the Exchange Act and the rules  thereunder) in excess of 4.99% of the then issued and outstanding shares of Common Stock; provided, however, that upon a holder of this Warrant providing the Issuer with sixty-one (61) days notice (pursuant to Section 13 hereof) (the "Waiver Notice") that such Holder would like to waive this Section 7 with regard to any or all shares of Common Stock issuable upon exercise of this Warrant, this Section 7 will be of no force or effect with regard to all or a portion of the Warrant referenced in the Waiver Notice; provided, further, that this provision shall be of no further force or effect during the sixty-one (61) days immediately preceding the expiration of the term of this Warrant.

8.

[Intentionally Omitted] 

9.

Definitions.  For the purposes of this Warrant, the following terms have the following meanings:

"Additional Shares of Common Stock" means all shares of Common Stock issued by the Issuer after the Original Issue Date, and all shares of Other Common, if any, issued by the Issuer after the Original Issue Date, except: (i) securities issued (other than for cash) in connection with a merger, acquisition, or consolidation, (ii) securities issued 

-13-

 

pursuant to the conversion or exercise of convertible or exercisable securities issued or outstanding on or prior to the date hereof or issued pursuant to the Purchase Agreement, (iii) the Warrant Stock, (iv) securities issued in connection with bona fide strategic license agreements or other partnering arrangements so long as such issuances are not for the purpose of raising capital, (v) Common Stock issued or the issuance or grants of options to purchase Common Stock pursuant to the Issuer’s stock option plans and employee stock purchase plans as they now exist on the Original Issue Date, (vi) any warrants issued to the placement agent and its designees for the transactions contemplated by the Purchase Agreement, and (vii) the payment of any principal in shares of Common Stock pursuant to the Notes. 

"Board" shall mean the Board of Directors of the Issuer.

"Capital Stock" means and includes (i) any and all shares, interests, participations or other equivalents of or interests in (however designated) corporate stock, including, without limitation, shares of preferred or preference stock, (ii) all partnership interests (whether general or limited) in any Person which is a partnership, (iii) all membership interests or limited liability company interests in any limited liability company, and (iv) all equity or ownership interests in any Person of any other type.

"Certificate of Incorporation" means the Certificate of Incorporation of the Issuer as in effect on the Original Issue Date, and as hereafter from time to time amended, modified, supplemented or restated in accordance with the terms hereof and thereof and pursuant to applicable law. 

"Common Stock" means the Common Stock, par value $.001 per share, of the Issuer and any other Capital Stock into which such stock may hereafter be changed.

"Common Stock Equivalent" means any Convertible Security or warrant, option or other right to subscribe for or purchase any Additional Shares of Common Stock or any Convertible Security.

"Convertible Securities" means evidences of Indebtedness, shares of Capital Stock or other Securities which are or may be at any time convertible into or exchangeable for Additional Shares of Common Stock.  The term "Convertible Security" means one of the Convertible Securities.

"Governmental Authority" means any governmental, regulatory or self-regulatory entity, department, body, official, authority, commission, board, agency or instrumentality, whether federal, state or local, and whether domestic or foreign.

"Holders" mean the Persons who shall from time to time own any Warrant.  The term "Holder" means one of the Holders.

"Independent Appraiser" means a nationally recognized or major regional investment banking firm or firm of independent certified public accountants of 

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recognized standing (which may be the firm that regularly examines the financial statements of the Issuer) that is regularly engaged in the business of appraising the Capital Stock or assets of corporations or other entities as going concerns, and which is not affiliated with either the Issuer or the Holder of any Warrant.

"Issuer" means Datalogic International, Inc., a Delaware corporation, and its successors. 

"Majority Holders" means at any time the Holders of Warrants exercisable for a majority of the shares of Warrant Stock then issuable under the outstanding Warrants at that time.

“Notes” means the series  secured convertible promissory notes issued by the Issuer to the Purchasers pursuant to the Purchase Agreement.

"Original Issue Date" means October __, 2006.

"OTC Bulletin Board" means the over-the-counter electronic bulletin board.

"Other Common" means any other Capital Stock of the Issuer of any class which shall be authorized at any time after the date of this Warrant (other than Common Stock) and which shall have the right to participate in the distribution of earnings and assets of the Issuer without limitation as to amount.

“Outstanding Common Stock” means, at any given time, the aggregate amount of outstanding shares of Common Stock, assuming full exercise, conversion or exchange (as applicable) of all options, warrants and other Securities which are convertible into or exercisable or exchangeable for, and any right to subscribe for, shares of Common Stock that are outstanding at such time.

"Person" means an individual, corporation, limited liability company, partnership, joint stock company, trust, unincorporated organization, joint venture, Governmental Authority or other entity of whatever nature.

"Per Share Market Value" means on any particular date (a) the VWAP, or (b) if the Common Stock is not then publicly traded the fair market value of a share of Common Stock as determined by an Independent Appraiser selected in good faith by the Majority Holders; provided, however, that the Issuer, after receipt of the determination by such Independent Appraiser, shall have the right to select an additional Independent Appraiser, in which case, the fair market value shall be equal to the average of the determinations by each such Independent Appraiser; and provided, further that all determinations of the Per Share Market Value shall be appropriately adjusted for any stock dividends, stock splits or other similar transactions during such period.  The determination of fair market value by an Independent Appraiser shall be based upon the fair market value of the Issuer determined on a going concern basis as between a willing buyer and a willing seller and taking into account all relevant factors determinative of 

-15-

 

value, and shall be final and binding on all parties.  In determining the fair market value of any shares of Common Stock, no consideration shall be given to any restrictions on transfer of the Common Stock imposed by agreement or by federal or state securities laws, or to the existence or absence of, or any limitations on, voting rights.

"Purchase Agreement" means the Note and Warrant Purchase Agreement dated as of October __, 2006, among the Issuer and the Purchasers.

"Purchasers" means the purchasers of the Notes and the Warrants issued by the Issuer pursuant to the Purchase Agreement.

“Registration Rights Agreement” means the Registration Rights Agreement of even date herewith between the Issuer and the Holder and the other signatories thereto.

"Securities" means any debt or equity securities of the Issuer, whether now or hereafter authorized, any instrument convertible into or exchangeable for Securities or a Security, and any option, warrant or other right to purchase or acquire any Security.  "Security" means one of the Securities.

"Securities Act" means the Securities Act of 1933, as amended, or any similar federal statute then in effect.

"Subsidiary" means any corporation at least 50% of whose outstanding Voting Stock shall at the time be owned directly or indirectly by the Issuer or by one or more of its Subsidiaries, or by the Issuer and one or more of its Subsidiaries.

"Term" has the meaning specified in Section 1 hereof.

"Trading Day" means (a) a day on which the Common Stock is traded on the OTC Bulletin Board, or (b) if the Common Stock is not traded on the OTC Bulletin Board, a day on which the Common Stock is quoted in the over-the-counter “pink sheets’ market as reported by the National Quotation Bureau Incorporated (or any similar organization or agency succeeding its functions of reporting prices); provided, however, that in the event that the Common Stock is not listed or quoted as set forth in (a) or (b) hereof, then Trading Day shall mean any day except Saturday, Sunday and any day which shall be a legal holiday or a day on which banking institutions in the State of New York are authorized or required by law or other government action to close.

"Voting Stock" means, as applied to the Capital Stock of any corporation, Capital Stock of any class or classes (however designated) having ordinary voting power for the election of a majority of the members of the Board of Directors (or other governing body) of such corporation, other than Capital Stock having such power only by reason of the happening of a contingency.

“VWAP” means, for any date, (i) the daily volume weighted average price of the Common Stock for such date on the OTC Bulletin Board as reported by Bloomberg 

-16-

 

Financial L.P. (based on a Trading Day from 9:30 a.m. Eastern Time to 4:02 p.m. Eastern Time); (ii) if the Common Stock is not then listed or quoted on the OTC Bulletin Board and if prices for the Common Stock are then reported in the “Pink Sheets” published by the Pink Sheets, LLC (or a similar organization or agency succeeding to its functions of reporting prices), then the average of the “Pink Sheet” quotes for the five (5) Trading Days preceding the date of determination; or (iii) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by the Holder and reasonably acceptable to the Maker.

"Warrants" means the Warrants issued and sold pursuant to the Purchase Agreement, including, without limitation, this Warrant, and any other warrants of like tenor issued in substitution or exchange for any thereof pursuant to the provisions of Section 2(c), 2(d) or 2(e) hereof or of any of such other Warrants. 

"Warrant Price" initially means $_____, as such price may be adjusted from time to time as shall result from the adjustments specified in this Warrant, including Section 4 hereto, and in the Purchase Agreement.

"Warrant Share Number" means at any time the aggregate number of shares of Warrant Stock which may at such time be purchased upon exercise of this Warrant, after giving effect to all prior adjustments and increases to such number made or required to be made under the terms hereof.

"Warrant Stock" means Common Stock issuable upon exercise of any Warrant or Warrants or otherwise issuable pursuant to any Warrant or Warrants.

10.

Other Notices.  In case at any time:

(A)

the Issuer shall make any distributions to the holders of Common Stock; or

(B)

the Issuer shall authorize the granting to all holders of its Common Stock of rights to subscribe for or purchase any shares of Capital Stock of any class or other rights; or

(C)

there shall be any reclassification of the Capital Stock of the Issuer; or

(D)

there shall be any capital reorganization by the Issuer; or

(E)

there shall be any (i) consolidation or merger involving the Issuer or (ii) sale, transfer or other disposition of all or substantially all of the Issuer's property, assets or business (except a merger or other reorganization in which the Issuer shall be the surviving corporation and its shares of Capital Stock shall continue to be outstanding and unchanged and 

-17-

 

except a consolidation, merger, sale, transfer or other disposition involving a wholly-owned Subsidiary); or

(F)

there shall be a voluntary or involuntary dissolution, liquidation or winding-up of the Issuer or any partial liquidation of the Issuer or distribution to holders of Common Stock;

then, in each of such cases, the Issuer shall give written notice to the Holder of the date on which (i) the books of the Issuer shall close or a record shall be taken for such dividend, distribution or subscription rights or (ii) such reorganization, reclassification, consolidation, merger, disposition, dissolution, liquidation or winding-up, as the case may be, shall take place.  Such notice also shall specify the date as of which the holders of Common Stock of record shall participate in such dividend, distribution or subscription rights, or shall be entitled to exchange their certificates for Common Stock for securities or other property deliverable upon such reorganization, reclassification, consolidation, merger, disposition, dissolution, liquidation or winding-up, as the case may be.  Such notice shall be given no sooner than fifteen (15) days and not later than ten (10) days prior to the record date or the date on which the Issuer's transfer books are closed in respect thereto.  This Warrant entitles the Holder to receive copies of all financial and other information distributed or required to be distributed to the holders of the Common Stock.

11.

Amendment and Waiver.  Any term, covenant, agreement or condition in this Warrant may be amended, or compliance therewith may be waived (either generally or in a particular instance and either retroactively or prospectively), by a written instrument or written instruments executed by the Issuer and the Majority Holders; provided, however, that no such amendment or waiver shall reduce the Warrant Share Number, increase the Warrant Price, shorten the period during which this Warrant may be exercised or modify any provision of this Section 11 without the consent of the Holder of this Warrant.  No consideration shall be offered or paid to any person to amend or consent to a waiver or modification of any provision of this Warrant unless the same consideration is also offered to all holders of the Warrants.

12.

Governing Law; Jurisdiction.  This Warrant shall be governed by and construed in accordance with the internal laws of the State of New York, without giving effect to any of the conflicts of law principles which would result in the application of the substantive law of another jurisdiction.  This Warrant shall not be interpreted or construed with any presumption against the party causing this Warrant to be drafted.  The Issuer and the Holder agree that venue for any dispute arising under this Warrant will lie exclusively in the state or federal courts located in New York County, New York, and the parties irrevocably waive any right to raise forum non conveniens or any other argument that New York is not the proper venue.  The Issuer and the Holder irrevocably consent to personal jurisdiction in the state and federal courts of the state of New York.  The Issuer and the Holder consent to process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address in effect for notices to it under this Warrant and agrees that such service shall constitute good and sufficient service of process and notice thereof.  Nothing in this Section 12 shall affect or limit any right to serve process in any other manner permitted by law.  The Issuer and the Holder hereby agree that the prevailing 

-18-

 

party in any suit, action or proceeding arising out of or relating to this Warrant or the Purchase Agreement, shall be entitled to reimbursement for reasonable legal fees from the non-prevailing party.  The parties hereby waive all rights to a trial by jury.

13.

Notices.  Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall be deemed given and effective on the earlier of (i) the date of transmission, if such notice or communication is delivered via facsimile at the facsimile telephone number specified for notice prior to 5:00 p.m., eastern time, on a Trading Day, (ii) the Trading Day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile telephone number specified for notice later than 5:00 p.m., eastern time, on any date and earlier than 11:59 p.m., eastern time, on such date, (iii) the Trading Day following the date of mailing, if sent by overnight delivery by a nationally recognized overnight courier service or (iv) actual receipt by the party to whom such notice is required to be given.  The addresses for such communications shall be with respect to the Holder of this Warrant or of Warrant Stock issued pursuant hereto, addressed to such Holder at its last known address or facsimile number appearing on the books of the Issuer maintained for such purposes, or with respect to the Issuer, addressed to:

If to the Company:

DataLogic International, Inc.

18301 Von Karman Ave., Suite 250

Irvine, CA 92612

Attention:  Keith Moore, CEO

Facsimile No.:

(815) 301-8756

With a copy to:

Weed & Co. LLP

4695 MacArthur Court, Suite 1430

Newport Beach, CA 92660 

Attn:

Rick Weed, Esq.

Facsimile No.: (949) 475-9087

Copies of notices to the Holder shall be sent to Richardson & Patel LLP, 405 Lexington Avenue, 26th Floor, New York, New York 10174 Attention: Jody R. Samuels, Esq., Tel. No.: (212) 907-6686, Fax. No.: (212) 907-6687.  Any party hereto may from time to time change its address for notices by giving at least ten (10) days written notice of such changed address to the other party hereto.

14.

Warrant Agent.  The Issuer may, by written notice to each Holder of this Warrant, appoint an agent for the purpose of issuing shares of Warrant Stock on the exercise of this Warrant pursuant to subsection (b) of Section 2 hereof, exchanging this Warrant pursuant to subsection (d) of Section 2 hereof or replacing this Warrant pursuant to subsection (d) of Section 3 hereof, or any of the foregoing, and thereafter any such issuance, exchange or replacement, as the case may be, shall be made at such office by such agent.

-19-

 

15.

Remedies.  The Issuer stipulates that the remedies at law of the Holder of this Warrant in the event of any default or threatened default by the Issuer in the performance of or compliance with any of the terms of this Warrant may not be adequate and that, to the fullest extent permitted by law, such terms may be specifically enforced by a decree for the specific performance of any agreement contained herein or by an injunction against a violation of any of the terms hereof or otherwise.

16.

Successors and Assigns.  This Warrant and the rights evidenced hereby shall inure to the benefit of and be binding upon the successors and assigns of the Issuer, the Holder hereof and (to the extent provided herein) the Holders of Warrant Stock issued pursuant hereto, and shall be enforceable by any such Holder or Holder of Warrant Stock.

17.

Modification and Severability.  If, in any action before any court or agency legally empowered to enforce any provision contained herein, any provision hereof is found to be unenforceable, then such provision shall be deemed modified to the extent necessary to make it enforceable by such court or agency.  If any such provision is not enforceable as set forth in the preceding sentence, the unenforceability of such provision shall not affect the other provisions of this Warrant, but this Warrant shall be construed as if such unenforceable provision had never been contained herein.

18.

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

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

-20-

 

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

DATALOGIC INTERNATIONAL, INC.

By:

      Name:

      Title:

-21-

 

EXERCISE FORM

DATALOGIC INTERNATIONAL, INC.

The undersigned _______________, pursuant to the provisions of the within Warrant, hereby elects to purchase _____ shares of Common Stock of Datalogic International, Inc. covered by the within Warrant.

Dated: _________________

Signature

___________________________

Address

_____________________

_____________________

Number of shares of Common Stock beneficially owned or deemed beneficially owned by the Holder on the date of Exercise: _________________________

ASSIGNMENT

FOR VALUE RECEIVED, _________________ hereby sells, assigns and transfers unto __________________ the within Warrant and all rights evidenced thereby and does irrevocably constitute and appoint _____________, attorney, to transfer the said Warrant on the books of the within named corporation.

Dated: _________________

Signature

___________________________

Address

_____________________

_____________________

PARTIAL ASSIGNMENT

FOR VALUE RECEIVED, _________________ hereby sells, assigns and transfers unto __________________ the right to purchase _________ shares of Warrant Stock evidenced by the within Warrant together with all rights therein, and does irrevocably constitute and appoint ___________________, attorney, to transfer that part of the said Warrant on the books of the within named corporation.

Dated: _________________

Signature

___________________________

Address

_____________________

_____________________

FOR USE BY THE ISSUER ONLY:

-22-

 

Warrant (Midtown) - Datalogic FINAL.DOC

This Warrant No. W-___ canceled (or transferred or exchanged) this _____ day of ___________, _____, shares of Common Stock issued therefor in the name of _______________, Warrant No. W-_____ issued for ____ shares of Common Stock in the name of _______________.

-23-

 

Warrant (Midtown) - Datalogic FINAL.DOCexv10w33

 

Exhibit 10.33

WARRANT CERTIFICATE

					
	

NUMBER
	 	

(SEE REVERSE LEGEND)
	 	

WARRANTS

(THIS WARRANT WILL BE VOID IF NOT EXERCISED PRIOR

TO 5:00 P.M. NEW YORK CITY TIME,                     , 2011

SMART MOVE, INC.

CUSIP #                    

WARRANT

     THIS CERTIFIES THAT, for value received                                         is the registered holder of a Warrant expiring
                    , 2011 (the “Warrant”) to purchase one fully paid and non-assessable share of Common Stock,
par value $.001 per share (“Shares”), of Smart Move, Inc., a Delaware corporation (the “Company”)
for each Warrant evidenced by this Warrant Certificate. The Warrant entitles the holder thereof to
purchase from the Company, commencing on the date when the Units (of which the Shares are a part
of) separate and expiring five (5) years thereafter, or                     , 2011, one (1) Share of the Company
at the price per share of $           [or 150% of the price at which each Unit is offered] in the
Company’s initial public offering, upon surrender of this Warrant Certificate and payment of the
Warrant Price at the office or agency of the Warrant Agent, Corporate Stock Transfer, Inc. (such
payment to be made by check made payable to the Warrant Agent), but only subject to the conditions
set forth herein and in the Warrant Agreement between the Company and Corporate Stock Transfer,
Inc. The Warrant Agreement provides that upon the occurrence of certain events the Warrant Price
and the number of Warrant Shares purchasable hereunder, set forth on the face hereof, may, subject
to certain conditions, be adjusted. The term Warrant Price as used in this Warrant Certificate
refers to the price per Share at which Shares may be purchased at the time the Warrant is
exercised.

     No fraction of a Share will be issued upon any exercise of a Warrant. If the holder of a
Warrant would be entitled to receive a fraction of a Share upon any exercise of a Warrant, the
Company shall, upon such exercise, round up to the nearest whole number the number of Shares to be
issued to such holder.

     Upon any exercise of the Warrant for less than the total number of full Shares provided for
herein, there shall be issued to the registered holder hereof or his assignee a new Warrant
Certificate covering the number of Shares for which the Warrant has not been exercised.

     Warrant Certificates, when surrendered at the office or agency of the Warrant Agent by the
registered holder hereof in person or by attorney duly authorized in writing, may be exchanged in
the manner and subject to the limitations provided in the Warrant Agreement, but without payment of
any service charge, for another Warrant Certificate or Warrant Certificates of like tenor and
evidencing in the aggregate a like number of Warrants.

     Upon due presentment for registration of transfer of the Warrant Certificate at the office

 

 

or agency of the Warrant Agent, a new Warrant Certificate or Warrant Certificates of like tenor and
evidencing in the aggregate a like number of Warrants shall be issued to the transferee in exchange
for this Warrant Certificate, subject to the limitations provided in the Warrant Agreement, without
charge except for any applicable tax or other governmental charge.

     The Company and the Warrant Agent may deem and treat the registered holder as the absolute
owner of this Warrant Certificate (notwithstanding any notation of ownership or other writing
hereon made by anyone), for the purpose of any exercise hereof, of any distribution to the
registered holder, and for all other purposes, and neither the Company nor the Warrant Agent shall
be affected by any notice to the contrary.

     This Warrant does not entitle the registered holder to any of the rights of a stockholder of
the Company until exercised.

	 	 	 
	By:
	 	 
	 
	 	 
	 

	 	 
	President

	 	Secretary

-2-

 

SUBSCRIPTION FORM

To Be Executed by the Registered Holder in Order to Exercise Warrants

The undersigned Registered Holder irrevocably elects to exercise                      Warrants
represented by this Warrant Certificate, and to purchase the shares of Common Stock issuable upon
the exercise of such Warrants, and requests that Certificates for such shares shall be issued in
the name of

	 	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 

	 	(PLEASE TYPE OR PRINT NAME AND ADDRESS)
	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 

	 	(SOCIAL SECURITY OR TAX IDENTIFICATION NUMBER)	 	 
	 

	 	and be delivered to	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 

	 	(PLEASE PRINT OR TYPE NAME AND ADDRESS)	 	 
	 
	 	 	 	 
	 

	 	 	 	 

and, if such number of Warrants shall not be all the Warrants evidenced by this Warrant
Certificate, that a new Warrant Certificate for the balance of such Warrants be registered in the
name of, and delivered to, the Registered Holder at the address stated below:

	 	 	 	 	 	 	 
	Dated:
	 	 	 	 	 	 
	 

	 	 
	 	 	 	 
	 

	 	 	 	 
	 	(SIGNATURE)
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	(ADDRESS)
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	(TAX IDENTIFICATION NUMBER)

-3-

 

ASSIGNMENT

To Be Executed by the Registered Holder in Order to Assign Warrants

For Value Received,                      hereby sell, assign, and transfer unto

	 	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 

	 	(PLEASE TYPE OR PRINT NAME AND ADDRESS)
	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 

	 	(SOCIAL SECURITY OR TAX IDENTIFICATION NUMBER)	 	 
	 

	 	and be delivered to	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 

	 	(PLEASE PRINT OR TYPE NAME AND ADDRESS)	 	 

                     of the Warrants represented by this Warrant Certificate, and hereby
irrevocably constitute and appoint                                          Attorney to transfer this Warrant
Certificate on the books of the Company, with full power of substitution in the premises.

	 	 	 	 	 	 	 
	Dated:
	 	 	 	 	 	 
	 

	 	 
	 	 	 	 
	 

	 	 	 	 
	 	(SIGNATURE)

THE SIGNATURE TO THE ASSIGNMENT OF THE SUBSCRIPTION FORM MUST

CORRESPOND TO THE NAME WRITTEN UPON THE FACE OF THIS WARRANT

CERTIFICATE IN EVERY PARTICULAR, WITHOUT ALTERATION

OR ENLARGEMENT OR ANY CHANGE WHATSOEVER, AND MUST BE

GUARANTEED BY A COMMERCIAL BANK OR TRUST COMPANY OR A MEMBER

FIRM OF THE AMERICAN STOCK EXCHANGE, NEW YORK STOCK EXCHANGE,

PACIFIC STOCK EXCHANGE OR CHICAGO STOCK EXCHANGE.

-4-

 

SMART MOVE, INC.

WARRANT AGREEMENT

     Agreement made as of                     , 2006 between Smart Move, Inc., a Delaware corporation (“Company”),
and Corporate Stock Transfer, Inc., with offices at 3200 Cherry Creek Drive South, Suite 430,
Denver, CO 80209 (“Warrant Agent”).

RECITALS

     WHEREAS, the Company is engaged in a public offering (“Public Offering”) of Units (“Units”)
and, in connection therewith, has determined to issue and deliver up to (i) 2,400,000 Warrants
(“Public Warrants”) to the public investors, and (ii)                      Warrants to                      (the
“Representative”) or its designees (“Representative’s Warrants” and, together with the Public
Warrants, the “Warrants”), each of such Public Warrants evidencing the right of the holder thereof
to purchase one (1) share of common stock, par value $0.001, of the Company for $          , subject to
adjustment as described herein; and

     WHEREAS, the Company has filed with the Securities and Exchange Commission a Registration
Statement, No. 333-137931 on Form SB-2 (together with amendments and supplements thereto, the
“Registration Statement”) for the registration, under the Securities Act of 1933, as amended
(“Act”) of, among other securities, the Warrants; and

     WHEREAS, the Company desires the Warrant Agent to act on behalf of the Company, and the
Warrant Agent is willing to so act, in connection with the issuance, registration, transfer,
exchange, redemption and exercise of the Warrants; and

     WHEREAS, the Company desires to provide for the form and provisions of the Warrants, the terms
upon which they shall be issued and exercised, and the respective rights, limitation of rights, and
immunities of the Company, the Warrant Agent, and the holders of the Warrants; and

     WHEREAS, all acts and things have been done and performed which are necessary to make the
Warrants, when executed on behalf of the Company and countersigned by or on behalf of the Warrant
Agent, as provided herein, the valid, binding and legal obligations of the Company, and to
authorize the execution and delivery of this Agreement.

     NOW, THEREFORE, in consideration of the mutual agreements herein contained, the parties hereto
agree as follows:

     1. Appointment of Warrant Agent. The Company hereby appoints the Warrant Agent to act
as agent for the Company for the Warrants, and the Warrant Agent hereby accepts such appointment
and agrees to perform the same in accordance with the terms and conditions set forth in this
Agreement.

     2. Warrants.

     2.1 Form of Warrant. Each Warrant shall be issued in registered form only, shall

-5-

 

be in substantially the form of Exhibit A hereto, the provisions of which are
incorporated herein and shall be signed by, or bear the facsimile signature of, the Chief Executive
Officer and Chairman of the Board of the Company and shall bear a facsimile of the Company’s seal.
In the event the person whose facsimile signature has been placed upon any Warrant shall have
ceased to serve in the capacity in which such person signed the Warrant before such Warrant is
issued, it may be issued with the same effect as if he or she had not ceased to be such at the date
of issuance.

     2.2 Effect of Countersignature. Unless and until countersigned by the Warrant Agent
pursuant to this Agreement, a Warrant shall be invalid and of no effect and may not be exercised by
the holder thereof.

     2.3 Registration.

     2.3.1 Warrant Register. The Warrant Agent shall maintain books (“Warrant Register”),
for the registration of original issuance and the registration of transfer of the Warrants. Upon
the initial issuance of the Warrants, the Warrant Agent shall issue and register the Warrants in
the names of the respective holders thereof in such denominations and otherwise in accordance with
instructions delivered to the Warrant Agent by the Company.

     2.3.2 Registered Holder. Prior to due presentment for registration of transfer of any
Warrant, the Company and the Warrant Agent may deem and treat the person in whose name such Warrant
shall be registered upon the Warrant Register (“registered holder”), as the absolute owner of such
Warrant and of each Warrant represented thereby (notwithstanding any notation of ownership or other
writing on the Warrant Certificate made by anyone other than the Company or the Warrant Agent), for
the purpose of any exercise thereof, and for all other purposes, and neither the Company nor the
Warrant Agent shall be affected by any notice to the contrary.

     2.4 Detachability of Warrants. The securities comprising the Units will not be
separately transferable until the earlier of (i) ninety (90) days after the date hereof or (ii)
thirty (30) days immediately following the date on which the Underwriter’s over-allotment option is
exercised in full.

     2.5 Warrants and Representative’s Warrants. The Representative’s Warrants shall have
the same terms and be in the same form as the Public Warrants except with respect to the Warrant
Price as set forth below in Section 3.1.

     3. Terms and Exercise of Warrants

     3.1 Warrant Price. Each Public Warrant shall, when countersigned by the Warrant Agent,
entitle the registered holder thereof, subject to the provisions of such Public Warrant and of this
Warrant Agreement, to purchase from the Company the number of its common stock shares stated
therein, at the price of $           per whole share, subject to the adjustments provided in Section 4
hereof and in the last sentence of this Section 3.1. Each Representative’s Warrant shall, when
countersigned by the Warrant Agent, entitle the registered holder thereof, subject to the
provisions of such Representative’s Warrant and of this Warrant Agreement, to purchase from the
Company the number of common stock shares stated therein, at the price of $           per whole

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share, subject to the adjustments provided in Section 4 hereof. The term “Warrant Price” as
used in this Warrant Agreement refers to the price per share at which common stock shares may be
purchased at the time a Warrant is exercised. The Company in its sole discretion may lower the
Warrant Price at any time prior to the Expiration Date. In the event the Company lowers the Warrant
Price as set forth hereinabove, the Company shall keep such Warrant Price in effect for at least
ten (10) business days.

     3.2 Duration of Warrants. A Warrant may be exercised only during the period (“Exercise
Period”) commencing the date the Units are separated through the date which is five (5) years after
the date of the Registration Statement. (“Expiration Date”). Each Warrant not exercised on or
before the Expiration Date shall become void, and all rights thereunder and all rights in respect
thereof under this Agreement shall cease at the close of business on the Expiration Date. The
Company in its sole discretion may extend the duration of the Warrants by delaying the Expiration
Date.

     3.3 Exercise of Warrants.

     3.3.1 Payment. Subject to the provisions of the Warrant and this Warrant Agreement, a
Warrant, when countersigned by the Warrant Agent, may be exercised by the registered holder thereof
by surrendering it, at the office of the Warrant Agent, or at the office of its successor as
Warrant Agent, in City of Denver and State of Colorado, with the subscription form, as set forth in
the Warrant, duly executed, and (i) by paying in full, in lawful money of the United States, in
cash, good certified check or good bank draft payable to the order of the Company (or as otherwise
agreed to by the Company), the Warrant Price for each full common stock share as to which the
Warrant is exercised and any and all applicable taxes due in connection with the exercise of the
Warrant, the exchange of the Warrant for the common stock share, and the issuance of the common
stock share or (ii) as to the Representative’s Warrants (and as to the Public Warrants but only in
the event that the Board of Directors of the Company, in their sole discretion, determine that the
Warrants may be exercised on a “cashless basis”), by surrendering his or her Warrant for that
number of common stock shares equal to the quotient obtained by dividing (x) the product of the
number of common stock shares underlying the Warrant, multiplied by the difference between the
Warrant Price and the “Fair Market Value” (defined below) by (y) the Fair Market Value. The “Fair
Market Value” shall mean the average reported last sale price of the common stock shares for the
ten (10) trading days ending on the third business day prior to the date on which the notice of
redemption is sent to holders of Warrant pursuant to Section 6 hereof.

     3.3.2 Issuance of Certificates. As soon as practicable after the exercise of any
Warrant and the clearance of the funds in payment of the Warrant Price, the Company shall issue to
the registered holder of such Warrant a certificate or certificates for the number of full common
stock shares to which he is entitled, registered in such name or names as may be directed by him,
her or it, and if such Warrant shall not have been exercised in full, a new countersigned Warrant
for the number of shares as to which such Warrant shall not have been exercised. Notwithstanding
the foregoing, the Company shall not be obligated to deliver any securities pursuant to the
exercise of a Warrant unless a registration statement under the Act with respect to the common
stock shares is effective. Warrants may not be exercised by, or securities issued to, any
registered holder in any state in which such exercise would be unlawful.

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     3.3.3 Valid Issuance. All common stock shares issued upon the proper exercise of a
Warrant in conformity with this Agreement shall be validly issued, fully paid and nonassessable.

     3.3.4 Date of Issuance. Each person in whose name any such certificate for common
stock shares is issued shall for all purposes be deemed to have become the holder of record of such
shares on the date on which the Warrant was surrendered and payment of the Warrant Price was made,
irrespective of the date of delivery of such certificate, except that, if the date of such
surrender and payment is a date when the stock transfer books of the Company are closed, such
person shall be deemed to have become the holder of such shares at the close of business on the
next succeeding date on which the stock transfer books are open.

     4. Adjustments.

     4.1 Stock Dividends — Split-Ups. If after the date hereof, and subject to the
provisions of Section 4.6 below, the number of outstanding common stock shares is increased by a
stock dividend payable in common stock shares, or by a split-up of common stock shares, or other
similar event, then, on the effective date of such stock dividend, split-up or similar event, the
number of common stock shares issuable on exercise of each Warrant shall be increased in proportion
to such increase in outstanding common stock shares.

     4.2 Aggregation of Shares. If after the date hereof, and subject to the provisions of
Section 4.6, the number of outstanding common stock shares is decreased by a consolidation,
combination, reverse stock split or reclassification of common stock shares or other similar event,
then, on the effective date of such consolidation, combination, reverse stock split,
reclassification or similar event, the number of common stock shares issuable on exercise of each
Warrant shall be decreased in proportion to such decrease in outstanding common stock shares.

     4.3 Adjustments in Exercise Price. Whenever the number of common stock shares
purchasable upon the exercise of the Warrants is adjusted, as provided in Section 4.1 and 4.2
above, the Warrant Price shall be adjusted (to the nearest cent) by multiplying such Warrant Price
immediately prior to such adjustment by a fraction (x) the numerator of which shall be the number
of common stock shares purchasable upon the exercise of the Warrants immediately prior to such
adjustment, and (y) the denominator of which shall be the number of common stock shares so
purchasable immediately thereafter. In the event the Warrant Price is
adjusted in accordance with this Section 4.3, the Company shall keep
each Warrant Price in effect for at least ten (10) business days.

     4.4 Replacement of Securities upon Reorganization, etc. In case of any
reclassification or reorganization of the outstanding common stock shares (other than a change
covered by Section 4.1 or 4.2 hereof or that solely affects the par value of such common stock
shares), or in the case of any consolidation of the Company with or into another corporation (other
than a consolidation in which the Company is the continuing corporation and that does not result in
any reclassification or reorganization of the outstanding common stock shares), or in the case of
any sale or conveyance to another corporation or entity of the assets or other property of the
Company as an entirety or substantially as an entirety in connection with which the Company is
dissolved, the Warrant holders shall thereafter have the right to purchase and receive, upon the
basis and upon the terms and conditions specified in the Warrants and in lieu of the common stock
shares of the Company immediately theretofore purchasable and receivable upon the exercise of the
rights represented thereby, the kind and amount of shares of stock or other

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securities or property (including cash) receivable upon such reclassification, reorganization,
or consolidation, or upon a dissolution following any such sale or transfer, that the Warrant
holder would have received if such Warrant holder had exercised his, her or its Warrant(s)
immediately prior to such event; and if any reclassification also results in a change in common
stock shares covered by Section 4.1 or 4.2, then such adjustment shall be made pursuant to Sections
4.1, 4.2, 4.3 and this Section 4.4. The provisions of this Section 4.4 shall similarly apply to
successive reclassifications, reorganizations, or consolidations, sales or other transfers.

     4.5 Notices of Changes in Warrant. Upon every adjustment of the Warrant Price or the
number of shares issuable upon exercise of a Warrant, the Company shall give written notice thereof
to the Warrant Agent, which notice shall state the Warrant Price resulting from such adjustment and
the increase or decrease, if any, in the number of shares purchasable at such price upon the
exercise of a Warrant, setting forth in reasonable detail the method of calculation and the facts
upon which such calculation is based. Upon the occurrence of any event specified in Sections 4.1,
4.2, 4.3 or 4.4, then, in any such event, the Company shall give written notice to the Warrant
holder, at the last address set forth for such holder in the warrant register, of the record date
or the effective date of the event. Failure to give such notice, or any defect therein, shall not
affect the legality or validity of such event.

     4.6 No Fractional Shares. Notwithstanding any provision contained in this Warrant
Agreement to the contrary, the Company shall not issue fractional shares upon exercise of Warrants.
If, by reason of any adjustment made pursuant to this Section 4, the holder of any Warrant would be
entitled, upon the exercise of such Warrant, to receive a fractional interest in a share, the
Company shall, upon such exercise, round up to the nearest whole number the number of the common
stock shares to be issued to the Warrant holder.

     4.7 Form of Warrant. The form of Warrant need not be changed because of any adjustment
pursuant to this Section 4, and Warrants issued after such adjustment may state the same Warrant
Price and the same number of shares as is stated in the Warrants initially issued pursuant to this
Agreement. However, the Company may at any time in its sole discretion make any change in the form
of Warrant that the Company may deem appropriate and that does not affect the substance thereof,
and any Warrant thereafter issued or countersigned, whether in exchange or substitution for an
outstanding Warrant or otherwise, may be in the form as so changed.

     5. Transfer and Exchange of Warrants.

     5.1 Registration of Transfer. The Warrant Agent shall register the transfer, from time
to time, of any outstanding Warrant upon the Warrant Register, upon surrender of such Warrant for
transfer, properly endorsed with signatures properly guaranteed and accompanied by appropriate
instructions for transfer. Upon any such transfer, a new Warrant representing an equal aggregate
number of Warrants shall be issued and the old Warrant shall be cancelled by the Warrant Agent. The
Warrants so cancelled shall be delivered by the Warrant Agent to the Company from time to time upon
request.

     5.2 Procedure for Surrender of Warrants. Warrants may be surrendered to the Warrant
Agent, together with a written request for exchange or transfer, and thereupon the Warrant Agent

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shall issue in exchange therefor one or more new Warrants as requested by the registered
holder of the Warrants so surrendered, representing an equal aggregate number of Warrants;
provided, however, that in the event that a Warrant surrendered for transfer bears a restrictive
legend, the Warrant Agent shall not cancel such Warrant and issue new Warrants in exchange therefor
until the Warrant Agent has received an opinion of counsel for the Company stating that such
transfer may be made and indicating whether the new Warrants must also bear a restrictive legend.

     5.3 Fractional Warrants. The Warrant Agent shall not be required to effect any
registration of transfer or exchange which will result in the issuance of a warrant certificate for
a fraction of a warrant.

     5.4 Service Charges. No service charge shall be made for any exchange or registration
of transfer of Warrants.

     5.5 Warrant Execution and Countersignature. The Warrant Agent is hereby authorized to
countersign and to deliver, in accordance with the terms of this Agreement, the Warrants required
to be issued pursuant to the provisions of this Section 5, and the Company, whenever required by
the Warrant Agent, will supply the Warrant Agent with Warrants duly executed on behalf of the
Company for such purpose.

     6. Other Provisions Relating to Rights of Holders of Warrants.

     6.1 No Rights as Stockholder. A Warrant does not entitle the registered holder thereof
to any of the rights of a stockholder of the Company, including, without limitation, the right to
receive dividends, or other distributions, exercise any preemptive rights to vote or to consent or
to receive notice as stockholders in respect of the meetings of stockholders or the election of
directors of the Company or any other matter.

     6.2 Lost, Stolen, Mutilated, or Destroyed Warrants. If any Warrant is lost, stolen,
mutilated, or destroyed, the Company and the Warrant Agent may on such terms as to indemnity or
otherwise as they may in their discretion impose (which shall, in the case of a mutilated Warrant,
include the surrender thereof), issue a new Warrant of like denomination, tenor, and date as the
Warrant so lost, stolen, mutilated, or destroyed. Any such new Warrant shall constitute a
substitute contractual obligation of the Company, whether or not the allegedly lost, stolen,
mutilated, or destroyed Warrant shall be at any time enforceable by anyone.

     6.3 Reservation of Common Stock Shares. The Company shall at all times reserve and
keep available a number of its authorized but unissued common stock shares that will be sufficient
to permit the exercise in full of all outstanding Warrants issued pursuant to this Agreement.

     6.4 Registration of Common Stock Shares. The Company agrees that prior to the
commencement of the Exercise Period, it shall file with the Securities and Exchange Commission a
post-effective amendment to the Registration Statement, or a new registration statement, for the
registration, under the Act, of, and it shall take such action as is necessary to qualify for sale,
in those states in which the Warrants were initially offered by the Company, the common stock
shares issuable upon exercise of the Warrants. In either case, the Company will use its best
efforts to cause the same to become effective and to maintain the effectiveness of

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such registration statement until the expiration of the Warrants in accordance with the
provisions of this Agreement. The provisions of this Section 6.4 may not be modified, amended or
deleted without the prior written consent of the Representative.

     7. Concerning the Warrant Agent and Other Matters.

     7.1 Payment of Taxes. The Company will from time to time promptly pay all taxes and
charges that may be imposed upon the Company or the Warrant Agent in respect of the issuance or
delivery of common stock shares upon the exercise of Warrants, but the Company shall not be
obligated to pay any transfer taxes in respect of the Warrants or such shares.

     7.2 Resignation or Consolidation of Warrant Agent.

     7.2.1 Appointment of Successor Warrant Agent. The Warrant Agent, or any successor to
it hereafter appointed, may resign its duties and be discharged from all further duties and
liabilities hereunder after giving sixty (60) days’ notice in writing to the Company. If the office
of the Warrant Agent becomes vacant by resignation or incapacity to act or otherwise, the Company
shall appoint in writing a successor Warrant Agent in place of the Warrant Agent. If the Company
shall fail to make such appointment within a period of 30 days after it has been notified in
writing of such resignation or incapacity by the Warrant Agent or by the holder of the Warrant (who
shall, with such notice, submit his Warrant for inspection by the Company), then the holder of any
Warrant may apply to the Supreme Court of the State of New York for the County of New York for the
appointment of a successor Warrant Agent at the Company’s cost. Any successor Warrant Agent,
whether appointed by the Company or by such court, shall be a corporation organized and existing
under the laws of the State of New York, in good standing and having its principal office in the
Borough of Manhattan, City and State of New York, and authorized under such laws to exercise
corporate trust powers and subject to supervision or examination by federal or state authority.
After appointment, any successor Warrant Agent shall be vested with all the authority, powers,
rights, immunities, duties, and obligations of its predecessor Warrant Agent with like effect as if
originally named as Warrant Agent hereunder, without any further act or deed; but if for any reason
it becomes necessary or appropriate, the predecessor Warrant Agent shall execute and deliver, at
the expense of the Company, an instrument transferring to such successor Warrant Agent all the
authority, powers, and rights of such predecessor Warrant Agent hereunder; and upon request of any
successor Warrant Agent the Company shall make, execute, acknowledge, and deliver any and all
instruments in writing for more fully and effectually vesting in and confirming to such successor
Warrant Agent all such authority, powers, rights, immunities, duties, and obligations.

     7.2.2 Notice of Successor Warrant Agent. In the event a successor Warrant Agent shall
be appointed, the Company shall give notice thereof to the predecessor Warrant Agent and the
transfer agent for the common stock shares not later than the effective date of any such
appointment.

     7.2.3 Merger or Consolidation of Warrant Agent. Any corporation into which the Warrant
Agent may be merged or with which it may be consolidated or any corporation resulting from any
merger or consolidation to which the Warrant Agent shall be a party shall be the successor Warrant
Agent under this Agreement without any further act.

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     7.3 Fees and Expenses of Warrant Agent.

     7.3.1 Remuneration. The Company agrees to pay the Warrant Agent reasonable
remuneration for its services as such Warrant Agent hereunder and will reimburse the Warrant Agent
upon demand for all expenditures that the Warrant Agent may reasonably incur in the execution of
its duties hereunder.

     7.3.2 Further Assurances. The Company agrees to perform, execute, acknowledge, and
deliver or cause to be performed, executed, acknowledged, and delivered all such further and other
acts, instruments, and assurances as may reasonably be required by the Warrant Agent for the
carrying out or performing of the provisions of this Agreement.

     7.4 Liability of Warrant Agent.

     7.4.1 Reliance on Company Statement. Whenever in the performance of its duties under
this Warrant Agreement, the Warrant Agent shall deem it necessary or desirable that any fact or
matter be proved or established by the Company prior to taking or suffering any action hereunder,
such fact or matter (unless other evidence in respect thereof be herein specifically prescribed)
may be deemed to be conclusively proved and established by a statement signed by the Chief
Executive Officer or Chairman of the Board of the Company and delivered to the Warrant Agent. The
Warrant Agent may rely upon such statement for any action taken or suffered in good faith by it
pursuant to the provisions of this Agreement.

     7.4.2 Indemnity. The Warrant Agent shall be liable hereunder only for its own
negligence, willful misconduct or bad faith. The Company agrees to indemnify the Warrant Agent and
save it harmless against any and all liabilities, including judgments, costs and reasonable counsel
fees, for anything done or omitted by the Warrant Agent in the execution of this Agreement except
as a result of the Warrant Agent’s negligence, willful misconduct, or bad faith.

     7.4.3 Exclusions. The Warrant Agent shall have no responsibility with respect to the
validity of this Agreement or with respect to the validity or execution of any Warrant (except its
countersignature thereof); nor shall it be responsible for any breach by the Company of any
covenant or condition contained in this Agreement or in any Warrant; nor shall it be responsible to
make any adjustments required under the provisions of Section 4 hereof or responsible for the
manner, method, or amount of any such adjustment or the ascertaining of the existence of facts that
would require any such adjustment; nor shall it by any act hereunder be deemed to make any
representation or warranty as to the authorization or reservation of any common stock shares to be
issued pursuant to this Agreement or any Warrant or as to whether any common stock shares will when
issued be valid and fully paid and nonassessable.

     7.5 Acceptance of Agency. The Warrant Agent hereby accepts the agency established by
this Agreement and agrees to perform the same upon the terms and conditions herein set forth and
among other things, shall account promptly to the Company with respect to Warrants exercised and
concurrently account for, and pay to the Company, all moneys received by the Warrant Agent for the
purchase of shares of the common stock (less any warrant solicitation fee due to the Representative
pursuant to Section 3.3.5 herein) through the exercise of Warrants.

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     8. Miscellaneous Provisions.

     8.1 Successors. All the covenants and provisions of this Agreement by or for the
benefit of the Company or the Warrant Agent shall bind and inure to the benefit of their respective
successors and assigns.

     8.2 Notices. Any notice, statement or demand authorized by this Warrant Agreement to
be given or made by the Warrant Agent or by the holder of any Warrant to or on the Company shall be
sufficiently given when so delivered if by hand or overnight delivery or if sent by certified mail
or private courier service within five days after deposit of such notice, postage prepaid,
addressed (until another address is filed in writing by the Company with the Warrant Agent), as
follows:

Smart Move, Inc.

5350 S. Roslyn Street, Suite 380,

Greenwood Village, CO 80111

Attn: Edward Johnson, CFO

     Any notice, statement or demand authorized by this Agreement to be given or made by the holder
of any Warrant or by the Company to or on the Warrant Agent shall be sufficiently given when so
delivered if by hand or overnight delivery or if sent by certified mail or private courier service
within five days after deposit of such notice, postage prepaid, addressed (until another address is
filed in writing by the Warrant Agent with the Company), as follows:

Corporate Stock Transfer, Inc.

3200 Cherry Creek Drive South, Suite 430

Denver, CO 80209

Telephone (303) 282-4800

Fax (303) 282-5800

Attn: Compliance Department

     9.3 Applicable law. (c) This Warrant shall be governed by and construed and enforced
in accordance with the laws of the State of Colorado. Each party hereby irrevocably submits to the
exclusive jurisdiction of the state and Federal courts sitting in the City of Colorado, for the
adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in
any suit, action or proceeding that it is not personally subject to the jurisdiction of any such
court or that such suit, action or proceeding is improper. Each party hereby irrevocably waives
personal service of process and consents to process being served in any such suit, action or
proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with
evidence of delivery) to such party at the address in effect for notices to it under this Warrant
and agrees that such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process
in any manner permitted by law. THE PARTIES HEREBY WAIVE ALL RIGHTS TO A TRIAL BY JURY.

     9.4 Persons Having Rights under this Agreement. Nothing in this Agreement

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expressed and nothing that may be implied from any of the provisions hereof is intended, or
shall be construed, to confer upon, or give to, any person or corporation other than the parties
hereto and the registered holders of the Warrants and, for the purposes of Sections 6.4 and 8.2
hereof, the Representative, any right, remedy, or claim under or by reason of this Warrant
Agreement or of any covenant, condition, stipulation, promise, or agreement hereof. The
Representative shall be deemed to be a third-party beneficiary of this Agreement with respect to
Sections 6.4 and 8.2 hereof. All covenants, conditions, stipulations, promises, and agreements
contained in this Warrant Agreement shall be for the sole and exclusive benefit of the parties
hereto (and the Representative with respect to the Sections 6.4 and 8.2 hereof) and their
successors and assigns and of the registered holders of the Warrants.

     9.5 Examination of the Warrant Agreement. A copy of this Agreement shall be available
at all reasonable times at the office of the Warrant Agent in Denver, Colorado, for inspection by
the registered holder of any Warrant. The Warrant Agent may require any such holder to submit his
Warrant for inspection by it.

     9.6 Counterparts. This Agreement may be executed in any number of counterparts and
each of such counterparts shall for all purposes be deemed to be an original, and all such
counterparts shall together constitute but one and the same instrument.

     9.7 Effect of Headings. The Section headings herein are for convenience only and are
not part of this Warrant Agreement and shall not affect the interpretation thereof.

     IN WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto as of the day
and year first above written.

	 	 	 	 	 
	SMART MOVE, INC.	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 
	 

	 	Name: Christopher Sapyta	 	 
	 

	 	Title: President, CEO	 	 
	 
	 	 	 	 
	CORPORATE STOCK TRANSFER, INC.	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 
	 

	 	Name: Carylyn K. Bell	 	 
	 

	 	Title: President	 	 

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