Exhibit 4.5
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUED UPON ANY EXERCISE HEREOF HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR ANY APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE SOLD
OR OTHERWISE TRANSFERRED TO ANY PERSON, INCLUDING A PLEDGEE, UNLESS (i) EITHER
(A) A REGISTRATION STATEMENT WITH RESPECT THERETO SHALL BE EFFECTIVE UNDER THE
SECURITIES ACT, OR (B) THE COMPANY SHALL HAVE RECEIVED AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY THAT AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT IS AVAILABLE, AND (ii) THERE SHALL HAVE BEEN COMPLIANCE WITH ALL
APPLICABLE STATE SECURITIES OR "BLUE-SKY" LAWS.
No. ______________ For the Purchase
of up to __________shares
of Common Stock
WARRANT TO PURCHASE
COMMON STOCK
OF
TNX TELEVISION HOLDINGS, INC.
(A DELAWARE CORPORATION)
TNX Television Holdings, Inc., a Delaware corporation (the "Company"),
for value received, hereby certifies that ______________________, or his, her or
its permitted assigns (the "Holder"), is entitled, subject to the terms set
forth below, to purchase from the Company, at any time or from time to time at
or before the earlier of 5:00 p.m. New York City local time on ____________ ___,
2009 (the "Expiration Date") and the termination of this Warrant as provided in
Section 6 hereof, up to __________________ shares of common stock, par value
$0.001 per share, of the Company ("Common Stock"), at a purchase price per share
equal to $____ per share (the "Base Price"), as adjusted upon the occurrence of
certain events as set forth in Section 2 of this Warrant. The shares of Common
Stock issuable upon exercise of this Warrant, and the purchase price per share,
are hereinafter referred to as "Warrant Stock" and the "Purchase Price,"
respectively.
1. Exercise.
1.1 Manner of Exercise; Payment in Cash. This Warrant may be
exercised by the Holder, in whole or in part, by surrendering this
Warrant, with the purchase form appended hereto as Exhibit A duly
executed by the Holder, at the principal office of the Company, or at
such other place as the Company may designate, accompanied by payment
in full of the Purchase Price payable in respect of the number of
shares of Warrant Stock purchased upon such exercise. Payment of the
Purchase Price shall be in cash or by certified or official bank check
payable to the order of the Company.
1.2 Effectiveness. Each exercise of this Warrant shall be
deemed to have been effected immediately prior to the close of business
on the day on which this Warrant shall have been surrendered to the
Company as provided in Section 1.1 above. At such time, the person or
persons in whose name or names any certificates for Warrant Stock shall
be issuable upon such exercise as provided in Section 1.3 below shall
be deemed to have become the holder or holders of record of the Warrant
Stock represented by such certificates.
1.3. Delivery of Certificate(s). As soon as practicable after
the exercise of this Warrant in full or in part, and in any event
within ten (10) business days thereafter, the Company at its sole
expense will cause to be issued in the name of, and delivered to, the
Holder, or, subject to the terms and conditions hereof, as such Holder
(upon payment by such Holder of any applicable transfer taxes) may
direct:
(a) A certificate or certificates for the number of
full shares of Warrant Stock to which such Holder shall be
entitled upon such exercise plus, in lieu of any fractional
share to which such Holder would otherwise be entitled, cash
in an amount determined pursuant to Section 1.4 hereof, and
(b) In case such exercise is in part only, a new
warrant or warrants (dated the date hereof) of like tenor,
calling in the aggregate on the face or faces thereof for the
number of shares of Warrant Stock (without giving effect to
any adjustment therein) equal to the number of such shares
called for on the face of this Warrant minus the number of
such shares purchased by the Holder upon such exercise as
provided in Section 1.1 above.
1.4. Fractional Shares. The Company shall not be required upon
the exercise of this Warrant to issue any fractional shares, but shall
make an adjustment therefor in cash on the basis of the fair market
value of the Warrant Stock reasonably determined by the Board of
Directors of the Company (and, in the case of a conversion of this
Warrant, in accordance with Section 1.5(c)).
1.5 Right to Convert Warrant into Stock; Net Issuance.
(a) Right to Convert. Subject to Section 6, in addition to and
without limiting the rights of the Holder under the terms of this
Warrant, the Holder shall have the right to convert this Warrant or any
portion thereof (the "Conversion Right") into shares of Warrant Stock
as provided in this Section 1.5 at any time or from time to time during
the term of this Warrant. Upon exercise of the Conversion Right with
respect to a particular number of shares subject to this Warrant (the
"Converted Warrant Shares"), the Company shall deliver to the Holder
(without payment by the Holder of any Purchase Price or any cash or
other consideration) that number of shares of fully paid and
nonassessable Warrant Stock equal to the quotient obtained by dividing
(X) the value of this Warrant (or the specified portion hereof) on the
Conversion Date (as defined in subsection (b) hereof), which value
shall be determined by subtracting (A) the aggregate Purchase Price of
the Converted Warrant Shares immediately prior to the exercise of the
Conversion Right from (B) the aggregate fair market value of the
Converted Warrant Shares issuable upon exercise of this Warrant (or the
specified portion hereof) on the Conversion Date (as herein defined) by
(Y) the fair market value of one share of Warrant Stock on the
Conversion Date (as herein defined).
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Expressed as a formula, such conversion shall be computed as follows:
N = B-A
---
Y
where: N = the number of shares of Warrant Stock that may be issued to
Holder
Y = the fair market value (FMV) of one share of Warrant Stock
A = the aggregate Warrant Price (Converted Warrant Shares x
Purchase Price)
B = the aggregate FMV (i.e., FMV x Converted Warrant Shares)
No fractional shares shall be issuable upon exercise of the Conversion
Right, and, if the number of shares to be issued determined in
accordance with the foregoing formula is other than a whole number, the
Company shall pay to the Holder an amount in cash equal to the fair
market value of the resulting fractional share of the Conversation Date
(as herein defined).
(b) Method of Exercise. The Conversion Right may be exercised
by the Holder by the surrender of this Warrant at the principal office
of the Company together with the Subscription Form in the form attached
hereto duly completed and executed and indicating the number of shares
subject to this Warrant which are being surrendered (referred to in
Section 1.5(a) hereof as the Converted Warrant Shares) in exercise of
the Conversion Right. Such conversion shall be effective upon receipt
by the Company of this Warrant together with the aforesaid written
statement, or on such later date as is specified therein (the
"Conversion Date"), and, at the election of the Holder hereof, may be
made contingent upon the occurrence of any of the events specified in
Section 6. Certificates for the shares issuable upon exercise of the
Conversion Right and, if applicable, a new warrant (date the date
hereof) evidencing the balance of the shares remaining subject to this
Warrant, shall be issued as of the Conversion Date and shall be
delivered to the Holder within thirty (30) days following the
Conversion Date.
(c) Determination of Fair Market Value. For purposes of this
Section 1.5, "fair market value" of a share of Warrant Stock as of a
particular date (the "Determination Date") shall mean:
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(1) If the Company's Common Stock is traded
on an exchange or is quoted on the Nasdaq National or
Small Cap Market, then the closing price on the day
before the Determination Date;
(2) If the Company's Common Stock is not
traded on an exchange or on the Nasdaq National or
Small Cap Market but is traded in the
over-the-counter market, then the closing price on
the day before the Determination Date;
(3) In the event that the Determination Date
is the date of a liquidation, dissolution or winding
up, or any event deemed to be a liquidation,
dissolution or winding up with respect to the Warrant
Stock under the Company's Certificate of
Incorporation, then the fair market value per share
of the Warrant Stock shall be determined by
aggregating all amounts to be payable per share to
holders of the Warrant Stock in the event of such
liquidation, dissolution or winding up; or
(4) In all other cases, the fair market
value per share of the Warrant Stock shall be
determined in good faith by the Company's Board of
Directors upon review of relevant factors.
2. Certain Adjustments. The Purchase Price and the number of shares of
Warrant Stock deliverable upon exercise of the Warrant shall be subject to
adjustment from time to time as follows:
2.1 Subdivision, Reclassification or Change in Common
Stock. In the event of any subdivision, reclassification or change of
the Common Stock into a greater number or different class or classes of
stock, the number of shares of Warrant Stock deliverable upon exercise
of this Warrant shall be determined in accordance with the terms of the
Certificate of Incorporation, and the Purchase Price for such Warrant
Stock shall be proportionately reduced.
2.2 Consolidation, Reclassification or Change in Common Stock.
In the event of any consolidation, reclassification or change of the
Common Stock into a lesser number or different class or classes of
stock, the number of shares of Warrant Stock deliverable upon exercise
of this Warrant shall be determined in accordance with the terms of the
Certificate of Incorporation, and the Purchase Price for such Warrant
Stock shall be proportionately increased.
2.3 Reorganizations. If there shall occur any capital
reorganization of the Common Stock (other than a subdivision,
combination, reclassification or change in par value), then, as part of
any such reorganization, lawful provision shall be made so that the
Holder shall have the right thereafter to receive upon the exercise of
this Warrant the kind and amount of shares of stock or other securities
or property which such Holder would have been entitled to receive if,
immediately prior to any such reorganization, such Holder had held the
number of shares of Common Stock which were then purchasable upon the
exercise of this Warrant. In any such case, appropriate adjustment (as
reasonably determined by the Board of Directors of the Company) shall
be made in the application of the provisions set forth herein with
respect to the rights and interests thereafter of the Holder such that
the provisions set forth in this Section 2 (including provisions with
respect to adjustment of the Purchase Price) shall thereafter be
applicable, as nearly as is reasonably practicable, in relation to any
shares of stock or other securities or property thereafter deliverable
upon the exercise of this Warrant.
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2.4 Merger, Consolidation or Sale of Assets. Subject to the
provisions of Section 6, if there shall be a merger or consolidation of
the Company with or into another corporation (other than a merger or
reorganization involving only a change in the state of incorporation of
the Company or the acquisition by the Company of other businesses where
the Company survives as a going concern), or the sale of all or
substantially all of the Company's capital stock or assets to any other
person, then as a part of such transaction, provision shall be made so
that the Holder shall thereafter be entitled to receive the number of
shares of stock or other securities or property of the Company, or of
the successor corporation resulting from the merger, consolidation or
sale, to which the Holder would have been entitled if the Holder had
exercised its rights pursuant to this Warrant immediately prior
thereto. In any such case, appropriate adjustment shall be made in the
application of the provisions of this Section 2 to the end that the
provisions of this Section 2 shall be applicable after that event in as
nearly equivalent a manner as may be practicable.
2.5 Certificate of Adjustment. When any adjustment is required
to be made in the Purchase Price, the Company shall promptly mail to
the Holder a certificate setting forth the Purchase Price after such
adjustment and setting forth a brief statement of the facts requiring
such adjustment. Delivery of such certificate shall be deemed to be a
final and binding determination with respect to such adjustment unless
challenged by the Holder within ten (10) days of receipt thereof. Such
certificate shall also set forth the kind and amount of stock or other
securities or property into which this Warrant shall be exercisable
following the occurrence of any of the events specified in this Section
2.
3. Compliance with Securities Act.
3.1 Unregistered Securities. The Holder acknowledges that this
Warrant and the Warrant Stock have not been registered under the
Securities Act, and agrees not to sell, pledge, distribute, offer for
sale, transfer or otherwise dispose of this Warrant or any Warrant
Stock in the absence of (i) an effective registration statement under
the Securities Act covering this Warrant or such Warrant Stock and
registration or qualification of this Warrant or such Warrant Stock
under any applicable "blue-sky" or state securities law then in effect,
or (ii) an opinion of counsel, satisfactory to the Company, that such
registration and qualification are not required. The Company may delay
issuance of the Warrant Stock until completion of any action or
obtaining of any consent, which the Company deems necessary under any
applicable law (including without limitation state securities or
"blue-sky" laws).
3.2 Legend. Certificates delivered to the Holder pursuant to
Section 1.3 shall bear the following legend or a legend in
substantially similar form:
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"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE
OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE
ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE
SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
APPLICABLE STATE SECURITIES LAWS, OR (B) AN OPINION OF
COUNSEL, IN A REASONABLY ACCEPTABLE FORM, THAT REGISTRATION IS
NOT REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES
LAWS, OR (II) UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID
ACT."
4. Reservation of Stock. The Company agrees that, prior to the
expiration of this Warrant, the Company will at all times have authorized and in
reserve, and will keep available, solely for issuance or delivery upon the
exercise of this Warrant, the shares of Common Stock and other securities and
properties as from time to time shall be receivable upon the exercise of this
Warrant, free and clear of all restrictions on sale or transfer and free and
clear of all preemptive rights and rights of first refusal.
5. Replacement of Warrants. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and (in the case of loss, theft or destruction) upon delivery of an
indemnity agreement (with surety if reasonably required) in an amount reasonably
satisfactory to the Company, or (in the case of mutilation) upon surrender and
cancellation of this Warrant, the Company will issue, in lieu thereof, a new
Warrant of like tenor.
6. Termination Upon Certain Events. If there shall be a merger or
consolidation of the Company with or into another corporation (other than a
merger or reorganization involving only a change in the state of incorporation
of the Company or the acquisition by the Company of other businesses where the
Company survives as a going concern), or the sale of all or substantially all of
the Company's capital stock or assets to any other person, or the liquidation or
dissolution of the Company, then as a part of such transaction, at the Company's
option, either:
(a) provision shall be made so that the Holder shall
thereafter be entitled to receive the number of shares of stock or
other securities or property of the Company, or of the successor
corporation resulting from the merger, consolidation or sale, to which
the Holder would have been entitled if the Holder had exercised its
rights pursuant to this Warrant immediately prior thereto (and, in such
case, appropriate adjustment shall be made in the application of the
provisions of this Section 6(a) to the end that the provisions of
Section 2 shall be applicable after that event in as nearly equivalent
a manner as may be practicable); or
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(b) this Warrant shall terminate on the effective date of such
merger, consolidation or sale (the "Termination Date") and become null
and void, provided that if this Warrant shall not have otherwise
terminated or expired, (i) the Company shall have given the Holder
written notice of such Termination Date at least twenty (20) business
days prior to the occurrence thereof and (ii) the Holder shall have the
right until 5:00 p.m., New York City local time, on the day immediately
prior to the Termination Date to exercise its rights hereunder to the
extent not previously exercised.
7. Transferability. Without the prior written consent of the Company,
this Warrant shall not be assigned, pledged or hypothecated in any way (whether
by operation of law or otherwise) and shall not be subject to execution,
attachment or similar process. Any attempted transfer, assignment, pledge,
hypothecation or other disposition of this Warrant or of any rights granted
hereunder contrary to the provisions of this Section 7, or the levy of any
attachment or similar process upon this Warrant or such rights, shall be null
and void.
8. No Rights as Stockholder. Until the exercise of this Warrant, the
Holder shall not have or exercise any rights by virtue hereof as a stockholder
of the Company.
9. Notices. All notices, requests and other communications hereunder
shall be in writing, shall be either (i) delivered by hand, (ii) made by telex,
telecopy or facsimile transmission, (iii) sent by overnight courier, or (iv)
sent by registered mail, postage prepaid, return receipt requested. In the case
of notices from the Company to the Holder, they shall be sent to the address
furnished to the Company in writing by the last Holder who shall have furnished
an address to the Company in writing. All notices from the Holder to the Company
shall be delivered to the Company at its offices at 0000 Xxxxxxxx Xx., Xxxxx
000, Xxxxxxxxxxxx , XX 00000, Attention: Secretary, or such other address as the
Company shall so notify the Holder. All notices, requests and other
communications hereunder shall be deemed to have been given (i) by hand, at the
time of the delivery thereof to the receiving party at the address of such party
described above, (ii) if made by telex, telecopy or facsimile transmission, at
the time that receipt thereof has been acknowledged by electronic confirmation
or otherwise, (iii) if sent by overnight courier, on the next business day
following the day such notices is delivered to the courier service, or (iv) if
sent by registered mail, on the fifth business day following the day such
mailing is made.
10. Waivers and Modifications. Any term or provision of this Warrant
may be waived only by written document executed by the party entitled to the
benefits of such terms or provisions. The terms and provisions of this Warrant
may be modified or amended only by written agreement executed by the parties
hereto.
11. Headings. The headings in this Warrant are for convenience of
reference only and shall in no way modify or affect the meaning or construction
of any of the terms or provisions of this Warrant.
12. Governing Law. This Warrant will be governed by and construed in
accordance with and governed by the laws of Delaware without giving effect to
the conflict of law principles thereof.
[Signature Page Follows]
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IN WITNESS WHEREOF, the Company has caused this Warrant to be duly
executed, by one of its officers thereunto duly authorized.
TNX TELEVISION HOLDINGS, INC.
By: ________________________________
Name:
Title:
EXHIBIT A
PURCHASE FORM
To: TNX TELEVISION HOLDINGS, INC.
The undersigned pursuant to the provisions set forth in the attached Warrant
hereby irrevocably elects to (check one):
_____ (A) purchase ___________________ shares of Common
Stock, par value $0.001 per share, of TNX Television
Holdings, Inc. (the "Common Stock"), covered by such
Warrant and herewith makes payment of $_____________,
representing the full purchase price for such shares
at the price per share provided for in such Warrant;
or
_____ (B) convert ______________________ Warrant Shares
into that number of shares of fully paid and
nonassessable shares of Common Stock, determined
pursuant to the provisions of Section 1.5 of the
Warrant.
Common Stock for which the Warrant may be exercised or converted shall
be known herein as "Warrant Stock."
The undersigned is aware that Warrant Stock has not been and will not
be registered under the Securities Act of 1933, as amended (the "Securities
Act"), or any state securities laws. The undersigned understands that reliance
by the Company on exemptions under the Securities Act is predicated in part upon
the truth and accuracy of the statements of the undersigned in this Purchase
Form.
The undersigned represents and warrants that (i) he has been furnished
with all information which he deems necessary to evaluate the merits and risks
of the purchase of Warrant Stock, (ii) he has had the opportunity to ask
questions concerning Warrant Stock and the Company and all questions posed have
been answered to his satisfaction, (iii) he has been given the opportunity to
obtain any additional information he deems necessary to verify the accuracy of
any information obtained concerning Warrant Stock and the Company and (iv) he
has such knowledge and experience in financial and business matters that he is
able to evaluate the merits and risks of purchasing Warrant Stock and to make an
informed investment decision relating thereto.
The undersigned hereby represents and warrant that he is purchasing
Warrant Stock for his own account for investment and not with a view to the sale
or distribution of all or any part of Warrant Stock.
The undersigned understands that because Warrant Stock has not been
registered under the Securities Act, he must continue to bear the economic risk
of the investment for an indefinite period of time and Warrant Stock cannot be
sold unless it is subsequently registered under applicable federal and state
securities laws or an exemption from such registration is available.
The undersigned agrees that he will in no event sell or distribute or
otherwise dispose of all or any part of Warrant Stock unless (i) there is an
effective registration statement under the Securities Act and applicable state
securities laws covering any such transaction involving Warrant Stock, or (ii)
the Company receives an opinion legal counsel acceptable to the Company stating
that such transaction is exempt from registration. The undersigned consents to
the placing of a legend on his certificate for Warrant Stock stating: (i) that
Warrant Stock has not been registered and setting forth the restriction on
transfer contemplated hereby and that certain Investor Rights Agreement among
the Company and the parties named therein; and (ii) to the placing of a
stop-transfer order on the books of the Company and with any transfer agents
against Warrant Stock until Warrant Stock may be legally resold or distributed
without restriction.
The undersigned has considered the federal and state income tax
implications of the exercise of the Warrant and the purchase and subsequent sale
of the Warrant Stock.
_______________________________
Signature
_______________________________
Print Name
or
Entity Name:_____________________
By:_____________________________
Signature
_______________________________
Print Name
_______________________________
Title
