Exhibit 10.19
ARADYME CORPORATION
(a Delaware corporation)
Warrant for the Purchase of [ ]
Shares of Common Stock, Par Value $0.001
THIS WARRANT WILL BE VOID
AFTER 5:00 P.M. MOUNTAIN DAYLIGHT TIME
ON JUNE 30, 2008
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These securities have not been registered with the U.S. Securities and Exchange
Commission (the "SEC") under the Securities Act and are being offered
in reliance on exemptions from registration provided in Section 4(2)
of the Securities Act and Rule 506 of Regulation D promulgated
thereunder and preemption from the registration or qualification
requirements (other than notice filing and fee provisions)
of applicable state laws under the National Securities Markets
Improvement Act of 1996 or exemption from such state
registration requirements.
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This warrant (this "Warrant") certifies that, for value received, [ ]
(the "Holder" or "Holders"), is entitled, at any time or from time to time on or
before 5:00 p.m. Mountain Daylight Time on June 30, 2008, (the "Exercise
Period"), to subscribe for, purchase, and receive [ ] shares (the "Shares") of
fully paid and nonassessable common stock, par value $0.001 (the "Common Stock")
of ARADYME CORPORATION, a Delaware corporation (the "Company"). This Warrant is
exercisable to purchase the Shares at a price of $0.75 per share (the "Exercise
Price"). The number of Shares to be received on exercise of this Warrant and the
Exercise Price may be adjusted on the occurrence of certain events as described
herein. If the rights represented hereby are not exercised by 5:00 p.m. Mountain
Daylight Time June 30,2008, this Warrant shall automatically become void and of
no further force or effect, and all rights represented hereby shall cease and
expire.
Subject to the terms set forth herein, this Warrant may be exercised by
the Holder in whole or in part by execution of the form of exercise attached
hereto and payment of the Exercise Price in the manner described herein, all
subject to the terms hereof.
1. Exercise of Warrants.
(a) The Holder shall have the rights of a shareholder only
with respect to Shares fully paid for by the Holder under this Warrant.
On the exercise of all or any portion of this Warrant in the manner
provided herein, the Holder exercising the same shall be deemed to have
become a holder of record of the Shares as to which this Warrant is
exercised for all purposes, and certificates for the securities so
purchased shall be delivered to the Holder within a reasonable time,
but in no event longer than ten days after this Warrant shall have been
exercised as set forth herein.
(b) This Warrant may be exercised, in accordance with all of
the terms and conditions set forth herein, by delivery of this Warrant
together with a form of purchase, a copy of which is attached hereto
and incorporated herein by this reference, in either of the following
ways:
(i) If the Holder elects to exercise this Warrant and
make payment, in whole or in part, in cash, the Holder shall
indicate on the form of purchase the number of shares of
common stock that the Holder then elects to purchase,
accompanied by a certified or official bank check payable to
the order of the Company in the amount of the full exercise
price of the common stock being purchased.
(ii) If the Holder elects to exercise this Warrant
and make payment, in whole or in part, for the shares of
common stock by the delivery of warrants represented hereby,
the Holder shall surrender or transfer to the Company such
warrants, valued at the amount by which the fair market value
of the common stock subject to such warrants exceeds the
Warrant's exercise price, equal in value to the full exercise
price of the common stock being purchased. Fair market value
shall mean the closing price for such stock on the close of
business on the day last preceding the date of exercise of
such Option as quoted on a registered national securities
exchange or, if not listed on such an exchange, the Nasdaq
Stock Market ("Nasdaq") of the National Association of
Securities Dealers, Inc., or, if not listed on such an
exchange or included on Nasdaq, shall mean the closing price
(or, if no closing price is available from sources deemed
reliable by the Company, the closing bid quotation) for such
stock as determined by the Company through any other reliable
means of determination available on the close of business on
the day last preceding the date of exercise of such Option.
(c) If this Warrant shall be exercised in respect to only a
part of the Shares covered hereby, the Holder shall be entitled to
receive a similar Warrant of like tenor and date covering the number of
Shares with respect to which this Warrant shall not have been
exercised.
2. Fully Paid Shares. The Company covenants and agrees that the Shares
which may be issued on the exercise of this Warrant will, on issuance pursuant
to the terms of this Warrant, be fully paid and nonassessable, free from all
taxes, liens, and charges with respect to the issue thereof, and not issued in
violation of the pre-emptive or similar right of any other person. The Company
further covenants and agrees that during the period within which the rights
represented by this Warrant may be exercised, the Company will have authorized
and reserved a sufficient number of Shares of Common Stock to provide for the
exercise of the rights represented by this Warrant.
3. Adjustment of Exercise Price and Number of Shares.
(a) The number of Shares purchasable on the exercise of this
Warrant and the Exercise Price shall be adjusted appropriately from
time to time as follows:
(i) In the event the Company shall declare a dividend
or make any other distribution on any capital stock of the
Company payable in Common Stock, rights to purchase Common
Stock, or securities convertible into Common Stock or shall
subdivide its outstanding shares of Common Stock into a
greater number of shares or combine such outstanding stock
into a smaller number of shares, then in each such event, the
number of Shares subject to this Warrant shall be adjusted so
that the holder shall be entitled to purchase the kind and
number of Shares of Common Stock or other securities of the
Company which it would have owned or have been entitled to
receive after the happening of any of the events described
above, had such Warrant been exercised immediately prior to
the happening of such event or any record date with respect
thereto; an adjustment made pursuant to this paragraph (a)
shall become effective immediately after the effective date of
such event retroactive to the record date for such event.
(ii) No adjustment in the number of Shares
purchasable hereunder shall be required unless such adjustment
would require an increase or decrease of at least 1% in the
number of Shares purchasable on the exercise of this Warrant;
provided, however, that any adjustments which by reason of
this paragraph (c) are not required to be made shall be
carried forward and taken into account in any subsequent
adjustment.
(iii) Whenever the number of Shares purchasable on
the exercise of this Warrant is adjusted, as herein provided,
the Exercise Price payable on exercise shall be adjusted by
multiplying the Exercise Price immediately prior to such
adjustment by a fraction, the numerator of which shall be the
number of Shares purchasable on the exercise of this Warrant
immediately prior to such adjustment and the denominator of
which shall be the number of Shares so purchasable immediately
thereafter.
(iv) Whenever the number of Shares purchasable on the
exercise of this Warrant or the Exercise Price of such Shares
are adjusted, as herein provided, the Company shall cause to
be promptly mailed by first class mail, postage prepaid, to
the Holder of this Warrant notice of such adjustment or
adjustments and shall deliver a resolution of the board of
directors of the Company setting forth the number of Shares
purchasable on the exercise of this Warrant and the Exercise
Price of such Shares after such adjustment, setting forth a
brief statement of the facts requiring such adjustment,
together with the computation by which such adjustment was
made. Such resolution, in the absence of manifest error, shall
be conclusive evidence of the correctness of adjustment.
(v) All such adjustments shall be made by the board
of directors of the Company, which shall be binding on the
Holder in the absence of demonstrable error.
(b) No Adjustment in Certain Cases. No adjustments shall be
made in connection with:
(i) the issuance of any Shares on the exercise of
this Warrant;
(ii) the conversion of shares of preferred stock;
(iii) the exercise or conversion of any rights,
options, warrants, or convertible securities containing the
right to purchase or acquire Common Stock;
(iv) the issuance of additional Shares or other
securities on account of the anti-dilution provisions
contained in or relating to this Warrant or any other option,
warrant, or right to acquire Common Stock;
(v) the purchase or other acquisition by the Company
of any shares of Common Stock, evidences of its indebtedness
or assets, or rights, options, warrants, or convertible
securities containing the right to subscribe for or purchase
Common Stock; or
(vi) the sale or issuance by the Company of any
shares of Common Stock, evidences of its indebtedness or
assets, or rights, options, warrants, or convertible
securities containing the right to subscribe for or purchase
Common Stock or other securities pursuant to options,
warrants, or other rights to acquire Common Stock or other
securities.
4. Notice of Certain Events. In the event of:
(a) any taking by the Company of a record of the holders of
any class of securities of the Company for the purpose of determining
the holders thereof who are entitled to receive any dividends or other
distribution, or any right to subscribe for, purchase, or otherwise
acquire any shares of stock of any class or any other securities or
property, or to receive any other rights;
(b) any capital reorganization of the Company, any
reclassification or recapitalization of the capital stock of the
Company, or any transfer of all or substantially all of the assets of
the Company to any other person, or any consolidation, share exchange,
or merger involving the Company; or
(c) any voluntary or involuntary dissolution, liquidation, or
winding up of the Company,
the Company will mail to the Holder(s) of this Warrant, at least 20 days prior
to the earliest date specified therein, a notice specifying the date on which
any such record is to be taken for the purpose of such dividend, distribution,
or right; the amount and character of such dividend, distribution, or right; or
the date on which any such reorganization, reclassification, transfer,
consolidation, share exchange, merger, dissolution, liquidation, or winding up
of the Company will occur and the terms and conditions of such transaction or
event.
5. Limitation of Assignment and/or Transfer. This Warrant may not be
assigned, nor transferred.
6. Restricted Securities. The Holder acknowledges that this Warrant is,
and that the Shares issuable on exercise hereof will be, "restricted securities"
as that term is defined in rule 144 promulgated under the Securities Act.
Accordingly, this Warrant must be taken for investment and held indefinitely and
may not be exercised or converted unless subsequently registered under the
Securities Act and/or comparable state securities laws or unless an exemption
from such registration is available. Likewise, any Shares issued on exercise of
this Warrant must be taken for investment and held indefinitely and may not be
resold unless such resale is registered under the Securities Act and/or
comparable state securities laws or unless an exemption from such registration
is available. A legend to the foregoing effect shall be placed conspicuously on
the face of all certificates for Shares issuable on exercise of this Warrant.
7. Reports Under Exchange Act. With a view to making available to the
Holders the benefits of rule 144 promulgated under the Securities Act and any
other rule or regulation of the SEC that may at any time permit a Holder to sell
the Shares issuable on exercise of this Warrant, the Company shall, until such
Shares may be resold pursuant to the provisions of rule 144(k) or any similar
provision:
(a) make and keep public information available, as those terms
are understood and defined in SEC rule 144;
(b) file with the SEC in a timely manner all reports and other
documents required of the Company under the Securities Act and the
Exchange Act; and
(c) furnish to any Holder, forthwith upon request (i) a
written statement by the Company that it has complied with the
reporting requirements of SEC rule 144, the Securities Act and the
Exchange Act, or that it qualifies as a registrant whose securities may
be resold pursuant to Form S-2 or Form S-3; (ii) a copy of the most
recent annual or quarterly report of the Company and such other reports
and documents so filed by the Company; and (iii) such other information
as may be reasonably requested in availing any Holder of any rule or
regulation of the SEC which permits the selling of any such securities
without registration or pursuant to such form.
8. Governing Law. This Warrant shall be construed under and be governed
by the laws of the state of Utah.
9. Notices. all notices, demands, requests, or other communications
required or authorized hereunder shall be deemed given sufficiently if in
writing and if personally delivered; if sent by facsimile transmission,
confirmed with a written copy thereof sent by overnight express delivery; if
sent by registered mail or certified mail, return receipt requested and postage
prepaid; of if sent by overnight express delivery:
If to the Holder, to: ________________________________________
________________________________________
Fax: ____________ or Phone:_____________
If to the Company, to: Aradyme Corporation
1255 North Research Way, Suite Q3500
Orem, UT 84097
Fax: (801) 705-5001
or other such addresses and facsimile numbers as shall be furnished by any party
in the manner for giving notices hereunder, and any such notice, demand,
request, or other communication shall be deemed to have been given as of the
date so delivered or sent by facsimile transmission, three days after the date
so mailed, or one day after the date so sent by overnight delivery.
10. Loss, Theft, Destruction, or Mutilation. Upon receipt by the
Company of reasonable evidence of the ownership of and the loss, theft,
destruction, or mutilation of this Warrant, the Company will execute and
deliver, in lieu thereof, a new Warrant of like tenor.
DATED effective as of the 30th day of June, 2005.
ARADYME CORPORATION
James R. Spencer, Chairman
Form of Purchase
(to be signed only upon exercise of Warrant)
TO: ARADYME CORPORATION
The undersigned, the owner of the attached Warrant, hereby irrevocable
elects to exercise the purchase rights represented by the Warrant for, and to
purchase thereunder, ________ shares of Common Stock of Aradyme Corporation and
herewith
___________________ makes payment of $______ therefor in cash; or
___________________ makes payment of $______ therefor through "cashless
exercise" as provided in section 1(b)(ii) of the Warrant.
Please issue the shares of Common Stock as to which this Warrant is exercised in
accordance with the instructions set forth below and, if the Warrant is being
exercised with respect to less than all of the Shares to which it pertains,
prepare and deliver a new Warrant of like tenor for the balance of the Shares
purchasable under the attached Warrant.
DATED this ____ day of ____________, 20___.
Signature:____________________________
Signature Guaranteed:_________________
INSTRUCTIONS FOR REGISTRATION OF STOCK
Name: _____________________________________
(Please Type or Print)
Address: _____________________________________
_____________________________________
_____________________________________
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NOTICE: The signature to the form of purchase must correspond with the name as
written upon the face of the attached Warrant in every particular without
alteration or enlargement or any change whatsoever, and must be guaranteed by a
bank, other than a savings bank, or by a trust company or by a firm having
membership on a registered national securities exchange.