Document:

dkmz_ex108.htm

    EXHIBIT
10.8

     

    FORM
OF NOTE

     

    THIS
NOTE AND THE SHARES OF COMMON STOCK  ISSUABLE
UPON  CONVERSION  HEREOF HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR APPLICABLE STATE SECURITIES
LAWS, AND MAY NOT BE SOLD, TRANSFERRED, OR OTHERWISE DISPOSED  OF IN
THE ABSENCE OF SUCH  REGISTRATION  OR RECEIPT BY THE MAKER
OF AN OPINION OF COUNSEL IN THE FORM,  SUBSTANCE AND SCOPE
REASONABLY  SATISFACTORY TO THE MAKER THAT THIS NOTE AND THE SHARES OF
COMMON STOCK ISSUABLE UPON CONVERSION HEREOF MAY BE
SOLD,  TRANSFERRED,  OR OTHERWISE  DISPOSED OF,
UNDER AN EXEMPTION FROM REGISTRATION UNDER THE ACT AND SUCH STATE SECURITIES
LAWS.

     

    KACHING
KACHING, INC.

     

    CONVERTIBLE
PROMISSORY NOTE

     

    
      	
              No.:
      KK-10-_______________

            	 
      	
              $_____________

            
	
              Dated:
      April ___, 2010

               

            	 
      	 
      

    

    

    FOR VALUE
RECEIVED, KaChing KaChing,
Inc.,  a  Delaware  corporation  (the
“Maker”),  hereby  promises  to  pay  to
the  order  of  _______________________
(together  with
its  successors,  representatives,  and
permitted  assigns,  the “Holder”),  in
accordance  with the
terms  hereinafter  provided,  the principal
amount
of  ________________________  ($______________),  together  with
interest thereon.  Concurrently  with
the  issuance  of this  Note,  the Maker
is issuing separate convertible promissory notes (the “Other Notes”) to
separate purchasers (the “Other Holders”)
pursuant to the Purchase Agreement (as defined in Section 1.01
hereof).

     

    All  payments  under
or  pursuant  to this Note  shall be made in
United  States
Dollars  in  immediately  available  funds
to the  Holder at the  address of the Holder first set forth
above or at such other place as the Holder may  designate from time to
time in  writing to the Maker or by wire  transfer of funds
to the Holder’s account, instructions for which are attached hereto as Exhibit A. The
outstanding principal balance of this Note shall be due and payable on October
[__], 2011 (the “Maturity Date”) or at
such earlier time as provided herein.

     

    ARTICLE
I.

     

    Section
1.01 Purchase Agreement.
This Note has been executed and delivered pursuant to the Securities Purchase
Agreement dated as of April [__], 2010 (the “Purchase Agreement”)
by and among the Maker and the purchasers listed therein. Capitalized terms used
and not otherwise defined herein shall have the meanings set forth for such
terms in the Purchase Agreement.

     

    
      
         

      

      
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    Section
1.02 Interest.

     

    (a) Beginning
on the issuance date of this Note (the “Issuance Date”), the
outstanding principal balance of this Note shall bear interest, in arrears, at a
rate per annum equal to ten  percent (10%), payable quarterly on
January 1, April 1, July 1 and October 1, beginning on July 1,
2010  in (A) cash or (B) shares of the Maker’s common stock, $.001 par
value per share (the “Common Stock”). The
Maker shall provide irrevocable written notice to the Holder of the form of
interest payment at least ten (10) days prior to an interest payment date. If no
such notice is provided at least ten (10) days prior to an interest payment
date, the Maker must make the interest payment in cash. The number of shares of
Common Stock to be issued as payment of accrued and unpaid interest shall be
determined by dividing (a) the total amount of accrued and unpaid interest to be
paid in Common Stock by (b) the lesser of (i) the Conversion Price (as defined
in Section 3.02 hereof) and (ii) 90% of the average of the Closing Bid Price (as
defined in Section 1.02(b) below) for the ten (10) Trading Days immediately
preceding the interest payment date. Interest shall be computed on the basis of
a 360-day year of twelve (12) 30-day months and shall accrue commencing on the
Issuance Date. Furthermore, upon the occurrence of an Event of Default (as
defined in Section 2.01 hereof), then to the extent permitted by law, the Maker
will pay interest to the Holder, payable on demand, on the outstanding principal
balance of the Note from the date of the Event of Default until such Event of
Default is cured at the annual rate of the lesser of twenty-four percent (24%)
and the maximum applicable legal rate per annum.

     

    (b) The term
“Closing Bid
Price” shall mean, on any particular date (i) the last closing bid price
per share of the Common Stock on such date on any registered national stock
exchange on which the Common Stock is then listed, or if there is no such price
on such date, then the last closing bid price on such exchange or quotation
system on the date nearest preceding such date, or (ii) if the Common Stock is
not listed then on a registered national stock exchange, the last trading price
for a share of Common Stock in the over-the-counter market, as reported by the
OTC Bulletin Board or in the National Quotation Bureau Incorporated (or similar
organization or agency succeeding to its functions of reporting prices) at the
close of business on such date, or (iii) if the Common Stock is not then
reported by the OTC Bulletin Board or the National Quotation Bureau Incorporated
(or similar organization or agency succeeding to its functions of reporting
prices), then the average of the “Pink Sheet” quotes on such date, as determined
in good faith by the Holder, or (iv) if the Common Stock is not then publicly
traded, the fair market value of a share of Common Stock as determined by the
Holder and reasonably acceptable to the Maker.

     

    Section
1.03 Payment on Non-Business
Days. Whenever any payment to be made shall be due on a Saturday, Sunday
or a public holiday under the laws of the State of New York, such payment may be
due on the next succeeding business day and such next succeeding day shall be
included in the calculation of the amount of accrued interest payable on such
date.

     

    Section
1.04 Transfer. This Note
may be transferred or sold, subject to the provisions of Section 4.08 of this
Note, or pledged, hypothecated or otherwise granted as security by the
Holder.

     

    Section
1.05 Replacement. Upon
receipt of a duly executed, notarized and unsecured written statement from the
Holder with respect to the loss, theft or destruction of this Note (or any
replacement hereof) and a standard indemnity, or, in the case of a mutilation of
this Note, upon surrender and cancellation of such Note, the Maker shall issue a
new Note, of like tenor and amount, in lieu of such lost, stolen, destroyed or
mutilated Note.

     

    
      
         

      

      
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    ARTICLE
II.                                

     

    EVENTS
OF DEFAULT; REMEDIES

     

    Section
2.01 Events of Default.
The occurrence of any of the following events shall be an “Event of Default”
under this Note:

     

    (a) the Maker
shall fail to make any principal or interest payments on the date such payments
are due and such default is not fully cured within three (3) business days after
the occurrence thereof; or

     

    (b) the
suspension from listing, without subsequent listing on any one of, or the
failure of the Common Stock to be listed on at least one of the OTC Bulletin
Board, the NYSE Amex Equities, the Nasdaq Capital Market, the Nasdaq Global
Market, the Nasdaq Global Select Market or The New York Stock Exchange, Inc. for
a period of seven (7) consecutive Trading Days; or

     

    (c) the
Maker’s notice to the Holder, including by way of public announcement, at any
time, of its inability to comply (for any reason or no reason) or its intention
not to comply with proper requests for conversion of this Note into shares of
Common Stock; or

     

    (d) the Maker
shall fail to (i) timely deliver the shares of Common Stock upon conversion of
the Note or any interest accrued and unpaid or (ii) make the payment of any fees
and/or liquidated damages under this Note, the Purchase Agreement or the
Warrants, which failure is not remedied within four (4) business days after the
incurrence thereof; or

     

    (e)  default
shall be made in the performance or observance of (i) any covenant, condition or
agreement contained in this Note and such default is not fully cured within five
(5) business days after the Holder delivers written notice to the Maker of the
occurrence thereof or (ii) any covenant, condition or agreement contained in the
Purchase Agreement, the Other Notes, the Warrants or any other Transaction
Document which is not covered by any other provisions of this Section 2.01 and
such default is not fully cured within five (5) business days after the Holder
delivers written notice to the Maker of the occurrence thereof; or

     

    (f) any
representation or warranty made by the Maker herein or in the Purchase
Agreement, the Other Notes, the Warrants or any other Transaction Document shall
prove to have been false or incorrect or breached in any respect on the date as
of which made and the Holder delivers written notice to the Maker of the
occurrence thereof; or

     

    (g) the Maker
shall (A) default in any payment of any amount or amounts of principal of or
interest on any Indebtedness (other than the Indebtedness hereunder) the
aggregate principal amount of which Indebtedness is in excess of $50,000 or (B)
default in the observance or performance of any other agreement or condition
relating to any Indebtedness or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event shall occur or
condition exist, the effect of which default or other event or condition is to
cause, or to permit the holder or holders or beneficiary or beneficiaries of
such Indebtedness to cause with the giving of notice if required, such
Indebtedness to become due prior to its stated maturity; or

     

    
      
         

      

      
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    (h) the
failure of the Maker to instruct its transfer agent to remove any legends from
shares of Common Stock eligible to be sold under Rule 144 of the Securities Act
and issue such unlegended certificates to the Holder within three (3) Trading
Days of the Holder’s request so long as the Holder has provided reasonable
assurances to the Maker that such shares of Common Stock can be sold pursuant to
Rule 144; or

     

    (i) the
breach by the Maker of the terms of any subordination agreement to which it is a
party relating to the subordination of any Indebtedness to this Note;
or

     

    (j) one or
more judgments, non-interlocutory orders or decrees shall be entered by a U.S.
state or federal or a foreign court or administrative agency of competent
jurisdiction against the Maker and/or any of its Subsidiaries involving, in the
aggregate, a liability as to any single or related series of transactions,
incidents or conditions, of $50,000 or more, and the same shall remain
unsatisfied, unvacated, unbonded or unstayed pending appeal for a period of 30
days after the entry thereof; or

     

    (k) any Lien
created by any of the Security Documents shall at any time fail to constitute a
valid first priority perfected Lien on all of the Collateral (as defined in the
Security Agreement) and the Pledged Collateral (as defined in each of the
Shareholder Guaranties) purported to be secured thereby, or any party thereto
shall so assert; or

     

    (l) the Maker
fails to file, or is determined to have failed to file, in a timely manner any
Periodic Report or Current Report (other than a Current Report that is required
solely pursuant to Item 1.01, 1.02, 2.03, 2.04, 2.05, 2.06, 4.02(a) or 5.02(e)
of Form 8-K as in effect on the Issuance Date) required to be filed with the SEC
pursuant to the Securities Exchange Act of 1934, as amended; or

     

    (m) any bank
at which any deposit account, blocked account, or lockbox account of the Maker
or any Subsidiary is maintained shall fail to comply with any material term of
any deposit account, blocked account, lockbox account or similar agreement to
which such bank is a party or any securities intermediary, commodity
intermediary or other financial institution at any time in custody, control or
possession of any investment property of the Maker or any Subsidiary shall fail
to comply with any of the terms of any investment property control agreement to
which such Person is a party (it being understood that only accounts pursuant to
which the Collateral Agent has requested account control agreements should be
subject to this clause (m)); or

     

    (n) any
material damage to, or loss, theft or destruction of, any Collateral, whether or
not insured, or any strike, lockout, labor dispute, embargo, condemnation, act
of God or public enemy, or other casualty which causes, for more than fifteen
(15) consecutive days, the cessation or substantial curtailment of revenue
producing activities at any facility of the Maker or any Subsidiary, if any such
event or circumstance could reasonably be expected to have a Material Adverse
Effect; or

     

    
      
         

      

      
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    (o) the
failure of the Maker to pay any amounts due to the Holder herein or any other
Transaction Document within five (5) business days of the date such payments are
due and such default is not fully cured within two (2) business days after the
Holder delivers written notice to the Maker of the occurrence thereof;
or

     

    (p) the
occurrence of an Event of Default under the Other Notes; or

     

    (q) the Maker
shall (i) apply for or consent to the appointment of, or the taking of
possession by, a receiver, custodian, trustee or liquidator of itself or of all
or a substantial part of its property or assets, (ii) make a general assignment
for the benefit of its creditors, (iii) commence a voluntary case under the
United States Bankruptcy Code (as now or hereafter in effect) or under the
comparable laws of any jurisdiction (foreign or domestic), (iv) file a petition
seeking to take advantage of any bankruptcy, insolvency, moratorium,
reorganization or other similar law affecting the enforcement of creditors’
rights generally, (v) acquiesce in writing to any petition filed against it in
an involuntary case under United States Bankruptcy Code (as now or hereafter in
effect) or under the comparable laws of any jurisdiction (foreign or domestic),
(vi) issue a notice of bankruptcy or winding down of its operations or issue a
press release regarding same, or (vii) take any action under the laws of any
jurisdiction (foreign or domestic) analogous to any of the foregoing;
or

     

    (r) a
proceeding or case shall be commenced in respect of the Maker, without its
application or consent, in any court of competent jurisdiction, seeking (i) the
liquidation, reorganization, moratorium, dissolution, winding up, or composition
or readjustment of its debts, (ii) the appointment of a trustee, receiver,
custodian, liquidator or the like of it or of all or any substantial part of its
assets in connection with the liquidation or dissolution of the Maker or (iii)
similar relief in respect of it under any law providing for the relief of
debtors, or any order for relief shall be entered in an involuntary case under
United States Bankruptcy Code (as now or hereafter in effect) or under the
comparable laws of any jurisdiction (foreign or domestic) against the Maker or
action under the laws of any jurisdiction (foreign or domestic) analogous to any
of the foregoing shall be taken with respect to the Maker; or

     

    (s) Robert J.
McNulty shall cease to be the President or Chief Executive Officer of the Maker
or otherwise become disabled or unable to perform his duties as the Maker’s
principal executive officer for any period of time; or

     

    (t) the Maker
shall fail to prepay 100% of the outstanding principal amount of the Notes and
all accrued and unpaid interest thereon on a Prepayment Date, as provided in
Section 3.06 hereof; or

     

    (u) any
representation or warranty made by any Shareholder Guarantor in either a
Shareholder Guaranty or Shareholder Pledge Agreement shall prove to have been
false or incorrect or breached in any respect on the date as of which made and
the Holder delivers written notice to the Maker of the occurrence thereof;
or

     

    
      
         

      

      
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    (v) any
Shareholder Guarantor shall (A) default or be in default in any payment of any
amount or amounts of principal of or interest on any Indebtedness that is
secured by a Lien on any Pledged Collateral (“Secured
Indebtedness”) (notwithstanding the prohibition against incurring or
permitting any Liens on Pledged Collateral contained within the Shareholder
Guaranties) or (B) default in the observance or performance of any other
agreement or condition relating to any Secured Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto, or any other
event shall occur or condition exist, the effect of which default or other event
or condition is to cause, or to permit the holder or holders or beneficiary or
beneficiaries of such Secured Indebtedness to cause with the giving of notice if
required, such Secured Indebtedness to become due prior to its stated
maturity.

     

    Section
2.02 Remedies Upon An Event of
Default. If an Event of Default shall have occurred and shall be
continuing, the Holder of this Note may at any time at its option, (a) declare
the entire unpaid principal balance of this Note, together with all interest
accrued hereon, due and payable, and thereupon, the same shall be accelerated
and so due and payable, without presentment, demand, protest, or notice, all of
which are hereby expressly unconditionally and irrevocably waived by the Maker;
provided, however, that upon
the occurrence of an Event of Default described in Sections 2.01(q) or (r), the
outstanding principal balance and accrued interest hereunder shall be
automatically due and payable, (b) demand that the principal amount of this Note
then outstanding and all accrued and unpaid interest thereon shall be converted
into shares of Common Stock at a Conversion Price per share calculated pursuant
to Section 3.01 hereof assuming that the date that the Event of Default occurs
is the Conversion Date (as defined in Section 3.01 hereof), or (c) exercise or
otherwise enforce any one or more of the Holder’s rights, powers, privileges,
remedies and interests under this Note, the Purchase Agreement, the Security
Documents or applicable law. No course of delay on the part of the Holder shall
operate as a waiver thereof or otherwise prejudice the right of the Holder. No
remedy conferred hereby shall be exclusive of any other remedy referred to
herein or now or hereafter available at law, in equity, by statute or
otherwise.

     

    ARTICLE
III.

     

    CONVERSION;
ANTIDILUTION; PREPAYMENT

     

    Section
3.01 Conversion Option. At
any time on or after the Issuance Date, this Note shall be convertible (in whole
or in part), at the option of the Holder (the “Conversion Option”),
into such number of fully paid and non-assessable shares of Common Stock (the
“Conversion
Rate”) as is determined by dividing (x) that portion of the outstanding
principal balance plus any accrued but unpaid interest under this Note as of
such date that the Holder elects to convert by (y) the Conversion Price (as
defined in Section 3.02 hereof) then in effect on the date on which the Holder
faxes a notice of conversion (the “Conversion Notice”),
duly executed, to the Maker (facsimile number (702) 463-7007, Attn.: Chief
Executive Officer) (the “Conversion Date”);
provided, however, that the
Conversion Price shall be subject to adjustment as described in Section 3.05
below. The Holder shall deliver this Note to the Maker at the address designated
in the Purchase Agreement at such time that this Note is fully converted. With
respect to partial conversions of this Note, the Maker shall keep written
records of the amount of this Note converted as of each Conversion
Date.

     

    
      
         

      

      
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    Section
3.02 Conversion Price. The
term “Conversion
Price” shall mean $0.30, subject to adjustment under Section 3.05
hereof.

     

    Section
3.03 Mechanics of
Conversion.

     

    (a) Not later
than three (3) Trading Days after any Conversion Date (the “Delivery Date”), the
Maker or its designated transfer agent, as applicable, shall issue and deliver
to the Holder or, at the request of the Holder (provided that a registration
statement under the Securities Act providing for the resale of the Common Stock
to which the Holder shall be entitled is then in effect or such shares may be
sold without the requirement to be in compliance with Rule 144(c)(1) of the
Securities Act and otherwise without restriction or limitation pursuant to Rule
144 of the Securities Act), to the Depository Trust Company (“DTC”) account on the
Holder’s behalf via the Deposit Withdrawal Agent Commission System (“DWAC”) as specified
in the Conversion Notice, registered in the name of the Holder or its designee,
for the number of shares of Common Stock to which the Holder shall be entitled.
Notwithstanding the foregoing to the contrary, the Maker or its transfer agent
shall only be obligated to issue and deliver the shares to DTC on a Holder’s
behalf via DWAC if (i) such shares may be issued without restrictive legends and
(ii) the Maker and the transfer agent are participating in DTC through the DWAC
system. If all of the conditions set forth in clauses (i) and (ii) above are not
satisfied, the Maker or its designated transfer agent, as the case may be, shall
deliver physical certificates representing the number of shares of Common Stock
being acquired upon the conversion of this Note. If in the case of any
Conversion Notice, any shares of Common Stock to which a Holder is entitled to
receive thereunder are not delivered to or as directed by the applicable Holder
by the Delivery Date, the Holder shall be entitled by written notice to the
Maker at any time on or before its receipt of such shares of Common Stock
thereafter, to rescind such conversion, in which event the Maker shall
immediately return this Note tendered for conversion, whereupon the Maker and
the Holder shall each be restored to their respective positions immediately
prior to the delivery of such notice of revocation, except that any amounts
described in Sections 3.03(b) and (c) shall be payable through the date notice
of rescission is given to the Maker.

     

    (b) The Maker
understands that a delay in the delivery of the shares of Common Stock upon
conversion of this Note beyond the Delivery Date could result in economic loss
to the Holder. If the Maker fails to deliver to the Holder such shares via DWAC
or a certificate or certificates pursuant to this Section hereunder by the
Delivery Date, the Maker shall pay to such Holder, in cash, an amount per
Trading Day for each Trading Day until such shares are delivered via DWAC or
certificates are delivered, together with interest on such amount at a rate of
10% per annum, accruing until such amount and any accrued interest thereon is
paid in full, equal to the greater of (A) (i) 1% of the aggregate principal
amount of the Notes requested to be converted for the first five (5) Trading
Days after the Delivery Date and (ii) 2% of the aggregate principal amount of
the Notes requested to be converted for each Trading Day thereafter and (B)
$2,000 per day (which amount shall be paid as liquidated damages and not as a
penalty). Nothing herein shall limit a Holder’s right to pursue actual damages
for the Maker’s failure to deliver any shares of Common Stock upon conversion
within the period specified herein and such Holder shall have the right to
pursue all remedies available to it at law or in equity (including, without
limitation, a decree of specific performance and/or injunctive relief).
Notwithstanding anything to the contrary contained herein, the Holder shall be
entitled to withdraw a Conversion Notice, and upon such withdrawal the Maker
shall only be obligated to pay the liquidated damages accrued in accordance with
this Section 3.03(b) through the date the Conversion Notice is
withdrawn.

     

    
      
         

      

      
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    (c) In
addition to any other rights available to the Holder, if the Maker fails to
cause its transfer agent to transmit to the Holder a certificate or certificates
representing the shares of Common Stock issuable upon conversion of this Note on
or before 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 shares of
Common Stock issuable upon conversion of this Note which the Holder anticipated
receiving upon such exercise (a “Buy-In”), then the
Maker 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 Common Stock issuable upon conversion of this Note that the
Maker was required to deliver to the Holder in connection with the conversion 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 Note and equivalent number of shares of Common Stock for
which such conversion was not honored or deliver to the Holder the number of
shares of Common Stock that would have been issued had the Maker timely complied
with its conversion 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 conversion 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 Maker shall be
required to pay the Holder $1,000. The Holder shall provide the Maker written
notice indicating the amounts payable to the Holder in respect of the Buy-In,
together with applicable confirmations and other evidence reasonably requested
by the Maker. 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 Maker’s failure to timely deliver certificates representing
shares of Common Stock upon conversion of this Note as required pursuant to the
terms hereof.

     

    Section
3.04 Ownership Cap and Certain
Conversion Restrictions. Notwithstanding anything to the contrary set
forth in Article III of this Note, at no time may the Holder convert this Note
if the number of shares of Common Stock to be issued pursuant to such conversion
would cause the Holder to be directly or indirectly the beneficial owner (as
determined in accordance with Section 13(d) of the Securities Exchange Act of
1934, as amended, and the rules thereunder) of more than 4.99% of the Common
Stock; provided, however, that upon
the Holder providing the Maker with sixty-one (61) days notice (pursuant to
Section 4.01 hereof) (the “Waiver Notice”) that
the Holder would like to waive this Section 3.04 with regard to any or all
shares of Common Stock issuable upon conversion of this Note, this Section 3.04
will be of no force or effect with regard to all or a portion of the Note
referenced in the Waiver Notice. For purposes of this section, the number of
shares of Common Stock owned by the Holder shall include the number of shares of
Common Stock issuable upon exercise of this Note but shall exclude the number of
shares of Common Stock which are issuable upon the exercise or conversion of the
unexercised or unconverted portion of any other securities of the Maker subject
to a limitation on exercise or conversion analogous to the limitation contained
herein owned by the Holder.

     

    
      
         

      

      
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    Section
3.05 Adjustment of Conversion
Price.

     

    (a) The
Conversion Price shall be subject to adjustment from time to time as
follows:

     

    (i) Adjustments for Stock Splits
and Combinations. If the Maker shall at any time or from time to time
after the Issuance Date, effect a stock split of the outstanding Common Stock,
the applicable Conversion Price in effect immediately prior to the stock split
shall be proportionately decreased. If the Maker shall at any time or from time
to time after the Issuance Date, combine the outstanding shares of Common Stock,
the applicable Conversion Price in effect immediately prior to the combination
shall be proportionately increased. Any adjustments under this Section
3.05(a)(i) shall be effective at the close of business on the date the stock
split or combination occurs.

     

    (ii) Adjustments for Certain
Dividends and Distributions. If the Maker shall at any time or from time
to time after the Issuance Date, make or issue or set a record date for the
determination of holders of Common Stock entitled to receive a dividend or other
distribution payable in shares of Common Stock, then, and in each event, the
applicable Conversion Price in effect immediately prior to such event shall be
decreased as of the time of such issuance or, in the event such record date
shall have been fixed, as of the close of business on such record date, by
multiplying, the applicable  Conversion Price then in effect by a
fraction: (1) the numerator of which shall be the total number of shares of
Common Stock issued and outstanding immediately prior to the time of such
issuance or the close of business on such record date; and (2) the denominator
of which shall be the total number of shares of Common Stock issued and
outstanding immediately prior to the time of such issuance or the close of
business on such record date plus the number of shares of Common Stock issuable
in payment of such dividend or distribution.

     

    (iii) Adjustment for Other
Dividends and Distributions. If the Maker shall at any time or from time
to time after the Issuance Date, make or issue or set a record date for the
determination of holders of Common Stock entitled to receive a dividend or other
distribution payable in other than shares of Common Stock, then, and in each
event, an appropriate revision to the applicable Conversion Price shall be made
and provision shall be made (by adjustments of the Conversion Price or
otherwise) so that the holder of this Note shall receive upon conversions
thereof, in addition to the number of shares of Common Stock receivable thereon,
the number of securities of the Maker that such holder would have received had
this Note been converted into Common Stock on the date of such event and had
thereafter, during the period from the date of such event to and including the
Conversion Date, retained such securities (together with any distributions
payable thereon during such period), giving application to all adjustments
called for during such period under this Section 3.05(a)(iii) with respect to
the rights of the holders of this Note and the Other Notes; provided, however, that if such
record date shall have been fixed and such dividend is not fully paid or if such
distribution is not fully made on the date fixed therefor, the Conversion Price
shall be adjusted pursuant to this paragraph as of the time of actual payment of
such dividends or distributions.

     

    
      
         

      

      
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    (iv) Adjustments for
Reclassification, Exchange or Substitution. If the Common Stock issuable
upon conversion of this Note at any time or from time to time after the Issuance
Date shall be changed to the same or different number of shares of any class or
classes of stock, whether by reclassification, exchange, substitution or
otherwise (other than by way of a stock split or combination of shares or stock
dividends provided for in Sections 3.05(a)(i), (ii) and (iii), or a
reorganization, merger, consolidation, or sale of assets provided for in Section
3.05(a)(v)), then, and in each event, an appropriate revision to the Conversion
Price shall be made and provisions shall be made (by adjustments of the
Conversion Price or otherwise) so that the Holder shall have the right
thereafter to convert this Note into the kind and amount of shares of stock and
other securities receivable upon reclassification, exchange, substitution or
other change, by holders of the number of shares of Common Stock into which such
Note might have been converted immediately prior to such reclassification,
exchange, substitution or other change, all subject to further adjustment as
provided herein.

     

    (v) Adjustments for
Reorganization, Merger, Consolidation or Sales of Assets. If at any time
or from time to time after the Issuance Date there shall be a capital
reorganization of the Maker (other than by way of a stock split or combination
of shares or stock dividends or distributions provided for in Section
3.05(a)(i), (ii) and (iii), or a reclassification, exchange or substitution of
shares provided for in Section 3.05(a)(iv)), or a merger or consolidation of the
Maker with or into another corporation where the holders of outstanding voting
securities of the Maker prior to such merger or consolidation do not own over
fifty percent (50%) of the outstanding voting securities of the merged or
consolidated entity, immediately after such merger or consolidation, or the sale
of all or substantially all of the Maker’s properties or assets to any other
person (an “Organic
Change”), then as a part of such Organic Change, (A) if the surviving
entity in any such Organic Change is a public company that is registered
pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and
its common stock is listed or quoted on a national exchange or the OTC Bulletin
Board, an appropriate revision to the Conversion Price shall be made and
provision shall be made (by adjustments of the Conversion Price or otherwise) so
that the Holder shall have the right thereafter to convert such Note into the
kind and amount of shares of stock and other securities or property of the Maker
or any successor corporation resulting from Organic Change, and (B) if the
surviving entity in any such Organic Change is not a public company that is
registered pursuant to the Exchange Act, or its common stock is not listed or
quoted on a national exchange or the OTC Bulletin Board, the Holder shall have
the right to demand that the unpaid principal of this Note and any accrued
interest thereon be immediately prepaid by the Maker. In any such case,
appropriate adjustment shall be made in the application of the provisions of
this Section 3.05(a)(v) with respect to the rights of the Holder after the
Organic Change to the end that the provisions of this Section 3.05(a)(v)
(including any adjustment in the applicable Conversion Price then in effect and
the number of shares of stock or other securities deliverable upon conversion of
this Note and the Other Notes) shall be applied after that event in as nearly an
equivalent manner as may be practicable.

     

    (vi) Adjustments for Issuance of
Additional Shares of Common Stock. In the event the Maker shall at any
time following the Issuance Date issue or sell any share of Common Stock
(otherwise than as provided in the foregoing subsections (i) through (v) of this
Section 3.05(a) or pursuant to Common Stock Equivalents (hereafter defined)
granted or issued prior to the Issuance Date) (an “Additional Share of Common
Stock”) at a price per share less than the Conversion Price then in
effect, or without consideration (in which case such Additional Shares of Common
Stock shall be deemed to have been issued at a price per share of $.001), the
Conversion Price then in effect upon each such issuance shall be decreased to
the price equal to the consideration per share paid for such Additional Share of
Common Stock.

     

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

     

    (vii) Issuance of or Modification
of Common Stock Equivalents. In the event the Maker shall, at any time
following the Issuance Date: (i) issue or sell any securities convertible into
or exchangeable for, directly or indirectly, Common Stock (“Convertible
Securities”), or any rights or warrants or options to purchase any such
Common Stock or Convertible Securities (collectively, the “Common Stock
Equivalents”) with an exercise or conversion price less than the
Conversion Price then in effect, or (ii) modify the conversion or exercise price
of any Common Stock Equivalent issued prior to, on or after the Issuance Date,
to an exercise or conversion price less than the Conversion Price then in
effect, the Conversion Price then in effect shall be decreased to the exercise
or conversion price of such Common Stock Equivalent.

     

    (b) Record Date. In case
the Maker shall take record of the holders of its Common Stock for the purpose
of entitling them to subscribe for or purchase Common Stock or Convertible
Securities, then the date of the issue or sale of the shares of Common Stock
shall be deemed to be such record date.

     

    (c) Certain Issues
Excepted. Anything herein to the contrary notwithstanding, the Maker
shall not be required to make any adjustment to the Conversion Price pursuant to
Sections 3.05(a)(vi) or (vii) hereof upon (i) securities issued (other than for
cash) in connection with a merger, acquisition, or consolidation, (ii)
securities issued pursuant to the exercise or conversion of Common Stock
Equivalents issued prior to the Issuance Date (but such exception shall not
affect the obligation to decrease the Conversion Price if required by Section
3.05(a)(vii) hereof), (iii) 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 and (iv) Common Stock
issued or options to purchase Common Stock granted, in each case, pursuant to
the Maker’s stock option plans and employee stock purchase plans outstanding as
they exist on the date of the Purchase Agreement.

     

    (d) No Impairment. The
Maker shall not, by amendment of its Certificate of Incorporation or through any
reorganization, transfer of assets, consolidation, merger, dissolution, issue or
sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms to be observed or performed
hereunder by the Maker, but will at all times in good faith, assist in the
carrying out of all the provisions of this Section 3.05 and in the taking of all
such action as may be necessary or appropriate in order to protect the
conversion rights of the Holder hereunder against impairment. In the event a
Holder shall elect to convert any Notes as provided herein, the Maker cannot
refuse conversion based on any claim that such Holder or any one associated or
affiliated with such Holder has been engaged in any violation of law, violation
of an agreement to which such Holder is a party or for any reason whatsoever,
unless, an injunction from a court, or notice, restraining and or adjoining
conversion of all or of said Notes shall have issued and the Maker posts a
surety bond for the benefit of such Holder in an amount equal to one hundred
thirty percent (130%) of the amount of the Notes the Holder has elected to
convert, which bond shall remain in effect until the completion of
arbitration/litigation of the dispute and the proceeds of which shall be payable
to such Holder (as liquidated damages) in the event it obtains
judgment.

     

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

     

    (e) Certificates as to
Adjustments. Upon occurrence of each adjustment or readjustment of the
Conversion Price or number of shares of Common Stock issuable upon conversion of
this Note pursuant to this Section 3.05, the Maker at its expense shall promptly
compute such adjustment or readjustment in accordance with the terms hereof and
furnish to the Holder a certificate setting forth such adjustment and
readjustment, showing in detail the facts upon which such adjustment or
readjustment is based. The Maker shall, upon written request of the Holder, at
any time, furnish or cause to be furnished to the Holder a like certificate
setting forth such adjustments and readjustments, the applicable Conversion
Price in effect at the time, and the number of shares of Common Stock and the
amount, if any, of other securities or property which at the time would be
received upon the conversion of this Note. Notwithstanding the foregoing, the
Maker shall not be obligated to deliver a certificate unless such certificate
would reflect an increase or decrease of at least one percent (1%) of such
adjusted amount.

     

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

     

    (g) Fractional Shares. No
fractional shares of Common Stock shall be issued upon conversion of this Note.
In lieu of any fractional shares to which the Holder would otherwise be
entitled, the Maker shall pay cash equal to the product of such fraction
multiplied by the average of the Closing Bid Prices of the Common Stock for the
five (5) consecutive Trading Days immediately preceding the Conversion
Date.

     

    (h) Reservation of Common
Stock. The Maker shall at all times when this Note shall be outstanding,
reserve and keep available out of its authorized but unissued Common Stock, such
number of shares of Common Stock as shall from time to time be sufficient to
effect the conversion of this Note and all interest accrued thereon; provided
that the number of shares of Common Stock so reserved shall at no time be less
than one hundred twenty percent (120%) of the number of shares of Common Stock
for which this Note and all interest accrued thereon is at any time convertible.
The Maker shall, from time to time in accordance with Delaware law, increase the
authorized number of shares of Common Stock if at any time the unissued number
of authorized shares shall not be sufficient to satisfy the Maker’s obligations
under this Section 3.05(h).

     

    (i) Regulatory
Compliance. If any shares of Common Stock to be reserved for the purpose
of conversion of this Note or any interest accrued thereon require registration
or listing with or approval of any governmental authority, stock exchange or
other regulatory body under any federal or state law or regulation or otherwise
before such shares may be validly issued or delivered upon conversion, the Maker
shall, at its sole cost and expense, in good faith and as expeditiously as
possible, endeavor to secure such registration, listing or approval, as the case
may be.

     

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

     

    Section
3.06 Prepayment. Subject
to the terms set forth herein, at any time, provided there is not an Event of
Default, the Maker shall have the right to prepay 100%, and not less than 100%,
of the outstanding principal amount of this Note and all accrued and unpaid
interest thereon prior to the Maturity Date. The Maker may exercise its
prepayment right under this Section 3.06 by delivering a written notice thereof
by confirmed facsimile and overnight courier to all, but not less than all, of
the holders of the Notes (the “Prepayment Notice”
and the date such notice is delivered to all the holders is referred to as the
“Prepayment Notice
Date”) specifying the date of prepayment, which date shall be no earlier
than twenty (20) days, and no later than thirty (30) days, following the
Prepayment Notice Date (such specified date of prepayment being the “Prepayment Date”). A
Prepayment Notice shall be irrevocable. If the Maker elects to prepay this Note
pursuant to this Section 3.06, then it must simultaneously take the same action
with respect to the Other Notes. During the period between the Prepayment Notice
Date and the Prepayment Date, the Holder shall be entitled to all of its rights
under this Note, including, without limitation, its rights of conversion and
antiduliton set forth in this Article III. In the event that the Maker fails to
prepay, in full, the then outstanding principal amount of this Note and the
Other Notes and all accrued and unpaid interest thereon on the Prepayment Date,
the Maker shall subsequently be prohibited from prepaying any portion of the
principal amount of this Note without the prior written consent of the
Holder.

     

    Section
3.07 No Rights as
Stockholder. Nothing contained in this Note shall be construed as
conferring upon the Holder, prior to the conversion of this Note, the right to
vote or to receive dividends or to consent or to receive notice as a stockholder
in respect of any meeting of stockholders for the election of directors of the
Maker or of any other matter, or any other rights as a stockholder of the
Maker.

     

    ARTICLE
IV.

     

    MISCELLANEOUS

     

    Section
4.01 Notices. Any notice,
demand, request, waiver or other communication required or permitted to be given
hereunder shall be in writing and shall be effective (a) upon hand delivery,
telecopy or facsimile at the address or number designated in the Purchase
Agreement (if delivered on a business day during normal business hours where
such notice is to be received), or the first business day following such
delivery (if delivered other than on a business day during normal business hours
where such notice is to be received) or (b) on the second business day following
the date of mailing by express courier service, fully prepaid, addressed to such
address, or upon actual receipt of such mailing, whichever shall first occur.
The Maker will give written notice to the Holder at least ten (10) days prior to
the date on which the Maker takes a record (x) with respect to any dividend or
distribution upon the Common Stock, (y) with respect to any pro rata
subscription offer to holders of Common Stock or (z) for determining rights to
vote with respect to any Organic Change, dissolution, liquidation or winding-up
and in no event shall such notice be provided to such holder prior to such
information being made known to the public. The Maker will also give written
notice to the Holder at least ten (10) days prior to the date on which any
Organic Change, dissolution, liquidation or winding-up will take place and in no
event shall such notice be provided to the Holder prior to such information
being made known to the public. The Maker shall promptly notify the Holder of
this Note of any notices sent or received, or any actions taken with respect to
the Other Notes.

     

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

     

    Section
4.02 Governing Law. This
Note 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 Note shall not be interpreted or construed with any
presumption against the party causing this Note to be drafted.

     

    Section
4.03 Headings. Article and
section headings in this Note are included herein for purposes of convenience of
reference only and shall not constitute a part of this Note for any other
purpose.

     

    Section
4.04 Remedies, Characterizations,
Other Obligations, Breaches and Injunctive Relief. The remedies provided
in this Note shall be cumulative and in addition to all other remedies available
under this Note, at law or in equity (including, without limitation, a decree of
specific performance and/or other injunctive relief), no remedy contained herein
shall be deemed a waiver of compliance with the provisions giving rise to such
remedy and nothing herein shall limit a holder’s right to pursue actual damages
for any failure by the Maker to comply with the terms of this Note. Amounts set
forth or provided for herein with respect to payments, conversion and the like
(and the computation thereof) shall be the amounts to be received by the holder
thereof and shall not, except as expressly provided herein, be subject to any
other obligation of the Maker (or the performance thereof). The Maker
acknowledges that a breach by it of its obligations hereunder will cause
irreparable and material harm to the Holder and that the remedy at law for any
such breach may be inadequate. Therefore the Maker agrees that, in the event of
any such breach or threatened breach, the Holder shall be entitled, in addition
to all other available rights and remedies, at law or in equity, to seek and
obtain such equitable relief, including but not limited to an injunction
restraining any such breach or threatened breach, without the necessity of
showing economic loss and without any bond or other security being
required.

     

    Section
4.05 Enforcement Expenses.
The Maker agrees to pay all costs and expenses of enforcement of this Note,
including, without limitation, reasonable attorneys’ fees and
expenses.

     

    Section
4.06 Binding Effect. The
obligations of the Maker and the Holder set forth herein shall be binding upon
the successors and assigns of each such party, whether or not such successors or
assigns are permitted by the terms hereof.

     

    Section
4.07 Amendments. This Note
may not be modified or amended in any manner except in writing executed by the
Maker and the Holder.

     

    Section
4.08 Compliance with Securities
Laws. The Holder of this Note acknowledges that this Note is 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 shall not offer, sell or
otherwise dispose of this Note. This Note and any Note issued in substitution or
replacement therefor shall be stamped or imprinted with a legend in
substantially the following form:

     

    “THIS
NOTE AND THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION HEREOF HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR
APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE SOLD OR TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR RECEIPT BY THE MAKER OF AN  OPINION OF
COUNSEL IN THE FORM, SUBSTANCE AND SCOPE REASONABLY SATISFACTORY TO THE MAKER
THAT THIS NOTE AND THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION HEREOF
HAVE MAY BE SOLD, TRANSFERRED, HYPOTHECATED OR OTHERWISE DISPOSED OF, UNDER AN
EXEMPTION FROM REGISTRATION UNDER THE ACT AND SUCH STATE SECURITIES
LAWS.”

     

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

     

    Section
4.09 Consent to
Jurisdiction. Each of the Maker and the Holder (i) hereby irrevocably
submits to the exclusive jurisdiction of the United States District Court
sitting in the Southern District of New York and the courts of the State of New
York located in New York county for the purposes of any suit, action or
proceeding arising out of or relating to this Note and (ii) hereby waives, and
agrees not to assert in any such suit, action or proceeding, any claim that it
is not personally subject to the jurisdiction of such court, that the suit,
action or proceeding is brought in an inconvenient forum or that the venue of
the suit, action or proceeding is improper. Each of the Maker and the Holder
consents 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 the Purchase Agreement and agrees that such service shall constitute good
and sufficient service of process and notice thereof. Nothing in this Section
4.09 shall affect or limit any right to serve process in any other manner
permitted by law.

     

    Section
4.10 Parties in Interest.
This Note shall be binding upon, inure to the benefit of and be enforceable by
the Maker, the Holder and their respective successors and permitted
assigns.

     

    Section
4.11 Failure or Indulgence Not
Waiver. No failure or delay on the part of the Holder in the exercise of
any power, right or privilege hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such power, right or privilege
preclude other or further exercise thereof or of any other right, power or
privilege.

     

    Section
4.12 Excessive Interest.
Notwithstanding any other provision herein to the contrary, this Note is hereby
expressly limited so that the interest rate charged hereunder shall at no time
exceed the maximum rate permitted by applicable law. If, for any circumstance
whatsoever, the interest rate charged exceeds the maximum rate permitted by
applicable law, the interest rate shall be reduced to the maximum rate
permitted, and if the Holder shall have received an amount that would cause the
interest rate charged to be in excess of the maximum rate permitted, such amount
that would be excessive interest shall be applied to the reduction of the
principal amount owing hereunder (without charge for prepayment) and not to the
payment of interest, or if such excessive interest exceeds the unpaid balance of
principal, such excess shall be refunded to the Maker.

     

    Section
4.13 Maker Waivers. Except
as otherwise specifically provided herein, the Maker and all others that may
become liable for all or any part of the obligations evidenced by this Note,
hereby waive presentment, demand, notice of nonpayment, protest and all other
demands’ and notices in connection with the delivery, acceptance, performance
and enforcement of this Note, and do hereby consent to any number of renewals of
extensions of the time or payment hereof and agree that any such renewals or
extensions may be made without notice to any such persons and without affecting
their liability herein and do further consent to the release of any person
liable hereon, all without affecting the liability of the other persons, firms
or Maker liable for the payment of this Note, AND DO HEREBY WAIVE TRIAL BY
JURY.

     

    
      
         

      

      
        15

        
          

        

      

      
         

      

    

     

    (a) No delay
or omission on the part of the Holder in exercising its rights under this Note,
or course of conduct relating hereto, shall operate as a waiver of such rights
or any other right of the Holder, nor shall any waiver by the Holder of any such
right or rights on any one occasion be deemed a waiver of the same right or
rights on any future occasion.

     

    (b) THE MAKER
ACKNOWLEDGES THAT THE TRANSACTION OF WHICH THIS NOTE IS A PART IS A COMMERCIAL
TRANSACTION, AND TO THE EXTENT ALLOWED BY APPLICABLE LAW, HEREBY WAIVES ITS
RIGHT TO NOTICE AND HEARING WITH RESPECT TO ANY PREJUDGMENT REMEDY WHICH THE
HOLDER OR ITS SUCCESSORS OR ASSIGNS MAY DESIRE TO USE.

     

    Section
4.14 Definitions. For the
purposes hereof, the following terms shall have the following
meanings:

     

    (a) “Person” means an
individual or a corporation, partnership, trust, incorporated or unincorporated
association, joint venture, limited liability company, joint stock company,
government (or an agency or political subdivision thereof) or other entity of
any kind.

     

    (b) “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 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..

     

    [SIGNATURE
PAGE FOLLOWS]

     

    
      
         

      

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

     

    
      
        	 	KACHING
      KACHING, INC.	 
	 	 	 	 
	
                Date

              	
                By:
      

              	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 

      

    

     

    
       

      
         

      

      
        17

        
          

        

      

      
         

      

    

     

    FORM
OF

     

    NOTICE OF
CONVERSION

     

    (To be
Executed by the Registered Holder in order to Convert the Note)

     

    The
undersigned hereby  irrevocably elects to convert $
________________  of the principal  amount and accrued but
unpaid interest of the above  Note No.  ___
into  shares  of Common  Stock of KaChing
KaChing,  Inc. (the “Maker”)  according to the conditions
hereof, as of the date written below.

     

    Date of
Conversion:
___________________________________________________________________

     

    Applicable
Conversion Price:
____________________________________________________________

     

    Number of
shares of Common Stock beneficially owned or deemed beneficially owned by
the

     

    Holder on
the Date of
Conversion:_________________________________________________________

     

    Number of
shares of Common Stock to be issued upon
Conversion:________________________________

     

    Signature:
___________________________________________________________________________

     

    Address:____________________________________________________________________________

     

     

    
      
         

      

      
        18dkmz_ex109.htm

EXHIBIT 10.9

 

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

 

KACHING KACHING, INC.

 

	
No.: W-10-_______________

	  	
Number of shares: _____________

	
Date of Issuance: April ___, 2010

 

	  	  

FOR VALUE RECEIVED, the undersigned, KaChing KaChing, Inc., a Delaware corporation (together with its successors and assigns, the “Issuer”), hereby certifies that [________] or its registered assigns is entitled to subscribe for and purchase, during the Term (as hereinafter defined), up to ________________________________ (________________) shares (subject to adjustment as hereinafter provided) of the duly authorized, validly issued, fully paid and non-assessable 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. Capitalized terms used in this Warrant (the “Warrant”) and not otherwise defined herein shall have the respective meanings specified in Section 9 hereof.

 

1. Term. The term of this Warrant shall commence on April __, 2010 and shall expire at 6:00 p.m., Eastern Time, on April __, 2015 (such period being the “Term”).

 

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

 

(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, or (iii) by a combination of the foregoing methods of payment selected by the Holder of this Warrant.

 

  

1

  

 

(c) Cashless Exercise. Notwithstanding any provisions herein to the contrary, if, following the six (6) month anniversary of the Original Issue Date, (i) the Per Share Market Value of one share of Common Stock is greater than the Warrant Price (at the date of calculation as set forth below) and (ii) the Holder at the time of exercise is not able to sell the Warrant Stock pursuant to an effective registration statement filed under the Securities Act providing for the resale of the Warrant Stock, 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=

	 	

	 	 	 	 

 

	
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  on the Trading Day immediately preceding the date of such election.

(d) Issuance of Stock Certificates.

 

(i) In the event of any exercise of this Warrant in accordance with and subject to the terms and conditions hereof, 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 or the shares of Warrant Stock may be sold pursuant to Rule 144 of the Securities Act without restriction), issued and delivered to the Depository Trust Company (“DTC”) account on the Holder’s behalf via the 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. Notwithstanding the foregoing to the contrary, the Issuer or its transfer agent shall only be obligated to issue and deliver the shares to DTC on a holder’s behalf via DWAC if (i) such exercise is in connection with a sale, (ii) such shares may be issued without restrictive legends and (iii) the Issuer and the transfer agent are participating in DTC through the DWAC system. If all of the conditions set forth in clauses (i), (ii) and (iii) above are not satisfied, the transfer agent shall deliver physical certificates representing the shares of Warrant Stock to such Holder. The Holder shall deliver this original Warrant, or an indemnification undertaking with respect to such Warrant in the case of its loss, theft or destruction, at such time that this Warrant is fully exercised. With respect to partial exercises of this Warrant, the Issuer shall keep written records for the Holder of the number of shares of Warrant Stock exercised as of each date of exercise.

 

  

2

  

 

(ii) The Issuer understands that a delay in the delivery of the shares of Warrant Stock upon exercise of this Warrant beyond the Delivery Date could result in economic loss to the Holder. As such, if the Issuer fails for any reason to deliver to the Holder any shares of Warrant Stock issuable upon the exercise of this Warrant via DWAC or physical certificate by the Delivery Date, the Issuer shall pay to such Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Stock subject to such exercise (based on the Per Share Market Value of the Common Stock on the date of exercise), $10 per Trading Day (increasing to $20 per Trading Day on the fifth Trading Day after such liquidated damages begin to accrue) for each Trading Day after such Delivery Date until such certificates are delivered. Nothing herein shall limit a Holder’s right to pursue actual damages for the Issuer’s failure to deliver any shares of Common Stock upon exercise within the period specified herein and such Holder shall have the right to pursue all remedies available to it at law or in equity (including, without limitation, a decree of specific performance and/or injunctive relief).

 

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

 

  

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(f) Transferability of Warrant. Subject to Section 2(h) hereof, this Warrant may be transferred by a Holder, in whole or in part, 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:

 

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.

 

  

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(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 (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 or (iv) the Holder provides the Issuer with reasonable assurances that such security can be sold pursuant to Rule 144 under the Securities Act.  The Issuer will respond to any such notice from a holder within three (3) Trading 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 the Holder without a legend, in lieu of delivering physical certificates representing the Warrant Stock, the Issuer shall 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 (provided that the Issuer and the Issuer’s transfer agent are participating in DTC through the DWAC system).

 

(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.

 

  

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(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 in good faith use its 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, 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 Bylaws 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 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 Bylaws 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) upon the exercise of this Warrant, and (iv) use its 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 and Number of Shares Issuable Upon Exercise. The Warrant Price and the Warrant Share Number shall be subject to adjustment from time to time as set forth in this Section 4. 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.

 

  

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(a) Recapitalization, Reorganization, Reclassification, Consolidation, Merger or Sale.

 

(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 to the Warrant Price and the number of shares of Warrant Stock that may be purchased upon exercise of this Warrant 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 as adjusted to take into account 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 stockholder 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; provided, however, that in the event that the surviving entity pursuant to any such Triggering Event is not a public company that is 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, the Holder at its option may in lieu of such adjusted warrant elect to receive an amount of cash from the Issuer equal to the value of this Warrant as determined in accordance with the Black Scholes Option Pricing Model obtained from the “OV” function on Bloomberg L.P. using (1) a price per share of Common Stock equal to the VWAP of the Common Stock for the Trading Day immediately preceding the date of consummation of the applicable Triggering Event, (2) a risk-free interest rate corresponding to the U.S. Treasury rate for a period equal to the remaining term of this Warrant as of the date of consummation of the applicable Triggering Event and (3) an expected volatility equal to the 100 day volatility obtained from the “HVT” function on Bloomberg L.P. determined as of the Trading Day immediately following the public announcement of the applicable Triggering Event. Immediately upon the occurrence of a Triggering Event, the Issuer shall notify the Holder in writing of such Triggering Event and provide the calculations in determining the amount of issuable Securities, cash or property issuable upon exercise of the new warrant and the adjusted Warrant Price. Upon the Holder’s request, the continuing or surviving corporation as a result of such Triggering Event shall issue to the Holder a new warrant of like tenor evidencing the right to purchase the adjusted amount of Securities, cash or property and the adjusted Warrant Price pursuant to the terms and provisions of this Section 4(a)(i).

 

  

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(ii) In the event that the Holder has elected not to exercise this Warrant prior to the consummation of a Triggering Event and has also elected not to receive an amount in cash equal to the value of this Warrant calculated in accordance with the Black-Scholes formula pursuant to the provisions of Section 4(a)(i) above, the surviving entity and/or 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 property as, in accordance with the foregoing provisions of this subsection (a), such Holder shall be entitled to receive, and the surviving entity and/or each such Person shall have similarly delivered to such Holder an opinion of counsel for the surviving entity and/or each 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 the surviving entity and/or each 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.

 

  

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(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 cash, property, evidences of indebtedness or securities of any nature whatsoever (other than 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 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, securities or property so distributable, and (2) the Warrant Price then in effect shall be adjusted to equal the Warrant Price then in effect multiplied by a fraction (A) the numerator of which shall be the number of shares of Common Stock for which this Warrant is exercisable immediately prior to the adjustment and (B) the denominator of which shall be 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 or sell any share of Common Stock (otherwise than as provided in the Sections 4(a) and 4(b) hereof or pursuant to Common Stock Equivalents granted or issued prior to the Original Issue Date) (an “Additional Share of Common Stock”) at a price per share less than the Warrant Price then in effect, or without consideration (in which case such Additional Shares of Common Stock shall be deemed to have been issued at a price per share of $.001), the Warrant Price then in effect upon each such issuance shall be decreased to the price equal to the consideration per share paid for such Additional Share of Common Stock.

 

(e) Issuance or Modification of Common Stock Equivalents. In the event the Issuer shall, at any time following the Original Issue Date: (i) issue or sell any Common Stock Equivalent with an exercise or conversion price less than the Warrant Price then in effect, or (ii) modify the conversion or exercise price of any Common Stock Equivalent issued prior to, on or after the Original Issue Date, to an exercise or conversion price less than the Warrant Price then in effect, the Warrant Price then in effect shall be decreased to the exercise or conversion price of such Common Stock Equivalent.

 

(f) Certain Issues Excepted. Anything herein to the contrary notwithstanding, the Issuer shall not be required to make any adjustment to the Warrant Price pursuant to Sections 4(d) or 4(e) hereof upon (i) securities issued (other than for cash) in connection with a merger, acquisition, or consolidation, (ii) securities issued pursuant to the exercise or conversion of Common Stock Equivalents issued prior to the Original Issue Date (but such exception shall not affect the obligation to decrease the Warrant Price if required by Section 4(e)(ii) hereof), (iii) 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 and (iv) Common Stock issued or options to purchase Common Stock granted, in each case, pursuant to the Issuer’s stock option plans and employee stock purchase plans outstanding as they exist on the date of the Purchase Agreement.

 

  

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(g) 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) 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 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.

 

(ii) 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.

 

(iii) 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.

 

(h) 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.

 

(i) 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.

 

  

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5. Notice of Adjustments; Dispute Resolution. 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 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 three (3) business 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 ten (10) 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. Notwithstanding the foregoing to the contrary, the Issuer shall cause its transfer agent to promptly issue to the Holder the number of shares of Warrant Stock that is not disputed in accordance with the terms of this Section 5.

 

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 round the number of shares to be issued upon exercise up to the nearest whole number of shares.

 

7. Ownership Cap and Exercise Restriction. Notwithstanding anything to the contrary set forth in this Warrant, at no time may the Holder exercise this Warrant if the number of shares of Common Stock to be issued pursuant to such exercise would cause the Holder to be directly or indirectly the beneficial owner (as determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended, and the rules thereunder) of more than 4.99% of the Common Stock; provided, however, that upon the Holder providing the Issuer with sixty-one (61) days notice (pursuant to Section 13 hereof) (the “Waiver Notice”) that the 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. For purposes of this section, the number of shares of Common Stock owned by the Holder shall include the number of shares of Common Stock issuable upon exercise of this Warrant but shall exclude the number of shares of Common Stock which are issuable upon the exercise or conversion of the unexercised or unconverted portion of any other securities of the Issuer subject to a limitation on exercise or conversion analogous to the limitation contained herein owned by the Holder.

 

  

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8. Registration Rights. The Holder of this Warrant is entitled to the benefit of certain registration rights with respect to the shares of Warrant Stock issuable upon the exercise of this Warrant pursuant to that certain Registration Rights Agreement, of even date herewith, by and among the Issuer and Persons listed on Schedule I thereto (the “Registration Rights Agreement”) and the registration rights with respect to the shares of Warrant Stock issuable upon the exercise of this Warrant by any subsequent Holder may only be assigned in accordance with the terms and provisions of the Registrations Rights Agreement.

 

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

 

“Board” shall mean the Board of Directors of the Issuer.

 

“Buyers” means the buyers of the Notes and the Warrants issued by the Issuer pursuant to the Purchase Agreement.

 

“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, $.0001 par value 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.

 

  

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“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 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 KaChing KaChing, 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 issuable under the Warrants at the time outstanding.

 

“Notes” means the notes issued by the Company to the Buyers pursuant to the Purchase Agreement.

 

“Original Issue Date” means April __, 2010.

 

“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 Original Issue Date (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.

 

  

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“Per Share Market Value” means on any particular date (a) the closing sales price per share of the Common Stock on such date on any registered national stock exchange on which the Common Stock is then listed, or if there is no such closing sales price on such date, then the closing sales price on such exchange or quotation system on the date nearest preceding such date, or (b) if the Common Stock is not then listed on a registered national stock exchange, the closing sales price for a share of Common Stock in the over-the-counter market, as reported by the OTC Bulletin Board or in the National Quotation Bureau Incorporated (or similar organization or agency succeeding to its functions of reporting prices) at the close of business on such date, or (c) if the Common Stock is not then reported by the OTC Bulletin Board or the National Quotation Bureau Incorporated (or similar organization or agency succeeding to its functions of reporting prices), then the average of the “Pink Sheet” quotes for the five days preceding such date of determination, or (d) 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 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 Securities Purchase Agreement dated as of April __, 2010, among the Issuer and the Buyers.

 

“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 eligible to be traded on a registered national stock exchange, or (b) if the Common Stock is not eligible to be traded on any registered national stock exchange, a day on which the Common Stock is authorized for quotation on the OTC Bulletin Board, or (c) if the Common Stock is not eligible to be traded on a registered national stock exchange or authorized for quotation on the OTC Bulletin Board, a day on which the Common Stock is quoted in the over-the-counter 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), (b) or (c) 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.

 

  

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“Trading Market” means the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE Amex Equities, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock Exchange or the OTC Bulletin Board.

 

“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 (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, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time); (b) if the OTC Bulletin Board is not a Trading Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the OTC Bulletin Board; (c) if the Common Stock is not then quoted for trading on the OTC Bulletin Board and if prices for the Common Stock are then reported in the “Pink Sheets” published by Pink Sheets, LLC (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported; or (d) 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 Majority Holders and reasonably acceptable to the Company.

 

“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 $0.30, as such price may be adjusted from time to time as shall result from the adjustments specified in this Warrant, including Section 4 hereto.

 

“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 issued or 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 dividend or 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 Securities of the Issuer; 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

 

  

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(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 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 at least twenty (20) days prior to the action in question and not less 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 Holders of Warrants exercisable for at least two-thirds of the shares of Warrant Stock issuable under the Warrants at the time outstanding; 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.

 

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 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.

 

  

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13. Notices. Any notice, demand, request, waiver or other communication required or permitted to be given hereunder shall be in writing and shall be effective (a) upon hand delivery by telecopy, e-mail or facsimile at the address or number designated below (if delivered on a business day during normal business hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur. The addresses for such communications shall be:

 

(a) If to the Issuer:

 

KaChing KaChing, Inc.

 

9029 South Pecos Road, Suite 2800

 

Henderson, Nevada 89074

 

Attention: Robert J. McNulty

 

Facsimile: (702) 463-7007

 

with copies (which copies shall not constitute notice) to:

Krieger & Prager, LLP

39 Broadway, Suite 920

New York, New York 10006

Attention: Samuel M. Krieger, Esq.

Fax No.: (212) 363-2999

(b) If to any Holder at the address of such Holder set forth on Exhibit A to the Purchase Agreement or as specified in writing by such Holder with copies (which copies shall not constitute notice) to:

 

Haynes and Boone, LLP

1221 Avenue of the Americas, 26th  Floor

New York, New York 10020

Attention: Rick A. Werner, Esq.

Facsimile: (212) 884-8234

  

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     Any party hereto may from time to time change its address for notices by giving 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 having an office in New York, New York for the purpose of issuing shares of Warrant Stock on the exercise of this Warrant pursuant to subsections (b) and (c) of Section 2 hereof, exchanging this Warrant pursuant to subsection (f) 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.

 

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 are not and will 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.

 

[SIGNATURE PAGE FOLLOWS]

 

  

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

	 	KACHING KACHING, INC.	 
	 	 	 	 
	
 

	
By: 

	 	 
	 	 	Name:  Robert J. McNulty	 
	 	 	Title: Chief Executive Office	 
	 	 	 	 

 

 

  

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EXERCISE FORM

 

WARRANT

 

KACHING KACHING, INC.

 

The undersigned ____________________, pursuant to the provisions of the within Warrant (the “Warrant”), hereby elects to purchase _______________ shares of Common Stock of KaChing KaChing, 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: ___________________________

 

The undersigned is an “accredited investor” as defined in Regulation D under the Securities Act of 1933, as amended.

 

The undersigned intends that payment of the Warrant Price shall be made as (check one):

 

Cash Exercise                                           o

 

Cashless Exercise                                o

 

If the Holder has elected a Cash Exercise, the Holder shall pay the sum of $______________ by certified or official bank check (or via wire transfer) to the Issuer in accordance with the terms of the Warrant.

 

If the Holder has elected a Cashless Exercise, a certificate shall be issued to the Holder for the number of shares equal to the whole number portion of the product of the calculation set forth below, which is _______________. The Issuer shall pay a cash adjustment in respect of the fractional portion of the product of the calculation set forth below in an amount equal to the product of the fractional portion of such product and the Per Share Market Value on the date of exercise, which product is _____________ .

 

 

	X=   		 

 

 

Where:

 

The number of shares of Common Stock to be issued to the Holder _________________  (“X”).

 

  

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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 _______________________ (“Y”).

 

The Warrant Price ___________________ (“A”).

 

The Per Share Market Value of one share of Common Stock on the Trading Day immediately preceding the date of such election ______________________ (“B”).

 

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

	  
	  	  	  	  	  
	  	  	  	  	  

 

 

  

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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:

 

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 ________________________.

 

  

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