Exhibit 4.8
THIS COMMON STOCK PURCHASE WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"); OR UNDER ANY APPLICABLE LAW OR
REGULATION OF ANY STATE. THIS COMMON STOCK WARRANT MAY NOT BE SOLD, OFFERED,
ASSIGNED OR TRANSFERRED UNLESS THE WARRANT IS REGISTERED UNDER THE SECURITIES
ACT AND APPLICABLE STATE SECURITIES LAWS, OR SUCH OFFERS, SALES, ASSIGNMENTS AND
TRANSFERS ARE MADE PURSUANT TO THE AVAILABLE EXEMPTIONS FROM THE REGISTRATION
REQUIREMENTS OF THOSE LAWS.
VISUAL EDGE SYSTEMS INC.
COMMON STOCK PURCHASE WARRANT
DATED: August 20, 1997
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No.1
Number of Common Shares: 75,000 Holder: Vision Financial Group, Inc.
Purchase Price: $10.00 0000 Xxxxxxx Xxxxxx
Expiration Date: August 20, 2000 Xxxxxxxxxx, XX 00000
For identification only.
The governing terms of this Warrant are set forth below.
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Visual Edge Systems Inc., a Delaware corporation (the "Company"), hereby
certifies that, for value received, Vision Financial Group, Inc. or assigns
(each a "Holder"), is entitled, subject to the terms set forth below, to
purchase from the Company at any time or from time to time after the date hereof
and prior to August 20, 2000 (the "Exercise Period"), at the Purchase price
hereinafter set forth, seventy-five thousand (75,000) fully paid and
nonassessable shares of Common Stock (as hereinafter defined) of the Company.
The number and character of such shares of Common Stock and the Purchase Price
are subject to adjustment as provided herein.
This Warrant (this "Warrant"; such term to include any warrants issued in
substitution therefor) is issued in connection with that certain Letter (the
"Letter"), dated of even date herewith between the initial Holder hereof and the
Company.
The purchase price per share of Common Stock issuable upon exercise of this
Warrant (the "Purchase Price") shall initially be $10.00; provided, however,
that the Purchase Price shall be adjusted from time to time as provided herein.
As used herein the following terms, unless the context otherwise requires,
have the following respective meanings:
(a) The term "Company" shall include Visual Edge Systems Inc. and any
entity that shall succeed or assume the obligations of such corporation
hereunder.
(b) The term "Common Stock" includes (a) the Company's common stock,
$.01 par value per share, (b) any other capital stock of any class or
classes (however designated) of the Company, authorized on or after such
date, the holders of which shall have the right, without limitation as to
amount, either to all or to a share of the balance of current dividends and
liquidating dividends after the payment of dividends and distributions on
any shares entitled to preference, and the holders of which shall
ordinarily, in the absence of contingencies, be entitled to vote for the
election of a majority of directors of the Company (even though the right
so to vote has been suspended by the happening of such a contingency) and
(c) any other securities into which or for which any of the securities
described in (a) or (b) may be converted or exchanged pursuant to a plan of
recapitalization, reorganization, merger, sale of assets or otherwise.
(c) The term "Other Securities" refers to any stock (other than
Common Stock) and other securities of the Company or any other person
(corporate or otherwise) that the holder of this Warrant at any time shall
be entitled to receive, or shall have received, on the exercise of this
Warrant, in lieu of or in addition to Common Stock, or that at any time
shall be issuable or shall have been issued in exchange for or in
replacement of Common Stock or Other Securities pursuant to Section 4 or
otherwise.
1. Exercise of Warrant.
1.1. Method of Exercise. This Warrant may be exercised in whole or in part
(but not as to a fractional share of Common Stock), at any time and from time to
time during the Exercise Period, by the Holder hereof by delivery of a notice of
exercise (a "Notice of Exercise") substantially in the form attached hereto as
Exhibit A via facsimile to the Company. Promptly thereafter the Holder shall
surrender this Warrant to the Company at its principal office, accompanied by
payment of the Purchase Price multiplied by the number of shares of Common Stock
for which this Warrant is being exercised (the "Exercise Price"). Payment of
the Exercise Price shall be made by check or bank draft payable to the order of
the Company or by wire transfer to the account of the Company. If the amount of
the payment received by the Company is less than the Exercise Price, the Holder
will be notified of the deficiency and shall make payment in that amount within
five (5) business days. In the event the payment exceeds the Exercise Price,
the Company will promptly refund the excess to the Holder. Upon exercise, the
Holder shall be entitled to receive, promptly after payment in full, one or more
certificates, issued in the Holder's name or in such name or names as the Holder
may direct, subject to the limitations on transfer contained herein, for the
number of shares of Common Stock so purchased. The shares so purchased shall be
deemed to be issued as of the close of business on the date on which the Company
shall have received from the Holder payment of the Exercise Price (the "Exercise
Date").
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1.2. Regulation D Restrictions. The Holder hereof represents
and warrants to the Company that it has acquired this Warrant and
anticipates acquiring the shares of Common Stock issuable upon
exercise of the Warrant solely for its own account for investment
purposes and not with a view to or for distributing such securities
unless such distribution has been registered with the Securities
and Exchange Commission or an applicable exemption is available
therefor. At the time this Warrant is exercised, the Company may
require the Holder to state in the Notice of Exercise such
representations concerning the Holder as are necessary or
appropriate to assure compliance by the Holder with the Securities
Act.
1.3. Company Acknowledgment. The Company will, at the time of
the exercise of this Warrant, upon the request of the Holder
hereof, acknowledge in writing its continuing obligation to afford
to the Holder any rights to which the Holder shall continue to be
entitled after such exercise in accordance with the provisions of
this Warrant. If the Holder shall fail to make any such request,
such failure shall not affect the continuing obligation of the
Company to afford to the Holder any such rights.
1.4.Limitation on Exercise. Notwithstanding the rights of the
Holder to exercise all or a portion of this Warrant as described
herein, such exercise rights shall be limited solely in the manner
set forth in the Purchase Agreement as if such provisions were
specifically set forth herein.
2. Delivery of Stock Certificates, etc., on Exercise. As soon as
practicable after the exercise of this Warrant, the Company at its expense
(including the payment by it of any applicable issue, stamp or transfer taxes
upon issuance to the Holder) will cause to be issued in the name of and
delivered to the Holder to hereof, or, to the extent permissible hereunder,
to such other person as the Holder may direct, a certificate or certificates
for the number of full paid and nonassessable shares of Common Stock (or
Other Securities) to which the Holder shall be entitled on such exercise,
plus, in lieu of any fractional share to which the Holder would otherwise be
entitled, cash equal to the such fraction multiplied by the then applicable
Purchase Price, together with any other stock or other securities and
property (including cash, where applicable ) to which the Holder is entitled
upon such exercise pursuant to Section 1 or otherwise.
3. Adjustment for Dividends in Other Stock Property, etc.,
Reclassification, etc. In case at any time or from time to time the holders
of Common Stock (or Other Securities) shall have received, or (on or after
the record date fixed for the determination of stockholders eligible to
receive) shall have become entitled to receive, without payment therefor,
other or additional stock or other securities or property (other than cash)
by way of dividend or any cash (excluding cash dividends payable solely out
of earnings or earned surplus of the Company), or other or additional stock
or other securities or property (including cash) by way or spin-off,
split-up, reclassification, recapitalization, combination of shares or
similar corporate rearrangement other than additional shares of Common Stock
(or Other Securities) issued as a stock dividend or in a stock split
(adjustments in respect of which are provided for in Section 5), then and in
each such event, the
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Holder of this Warrant, on the exercise hereof as provided in Section 1 shall
be entitled to receive the amount of stock and other securities and property
(including cash in the cases referred to in subdivisions (b) and (c) of this
Section 3) that the Holder would have been entitled to receive on the
effective date of such event if the Holder had so exercised this Warrant
immediately prior thereto, giving effect to all adjustments called for during
such period by Sections 4 and 5.
4. Adjustment for Reorganization, Consolidation, Merger, etc.
4.1. Reorganization, etc. In case at any time or from time to
time, the Company shall (a) effect a reorganization, (b)
consolidate with or merge into any other person or (c) transfer all
or substantially all of its properties or assets to any other
person under any plan or arrangement contemplating the dissolution
of the Company, then, in each such case, the Holder of this
Warrant, nor the exercise hereof as provided in Section 1 at any
time after the consummation of such reorganization, consolidation
or merger or the effective date of such dissolution, as the case
may be, shall receive, in lieu of the Common Stock (or Other
Securities) issuable on such exercise prior to such consummation o
such effective date, the stock and other securities and property
(including cash) to which the Holder would have been entitled upon
such consummation or in connection with such dissolution, as the
case may be, if the Holder had so exercised this Warrant,
immediately prior thereto, all subject to further adjustment
thereafter as provided herein.
4.2. Dissolution. In the event of any dissolution of the
Company following the transfer of all or substantially all of its
properties or assets, the Company, prior to such dissolution, shall
at its expense deliver or cause to be delivered the stock and other
securities and property (including cash, where applicable)
receivable by the Holder of this Warrant after the effective date
of such dissolution pursuant to this Section 4 to a bank or trust
company, as trustee for the Holder or Holders of this Warrant.
4.3. Continuation of Terms. Upon any reorganization,
consolidation, merger or transfer (and any dissolution following
any transfer) referred to in this Section 4, this Warrant shall
continue in full force and effect and the terms hereof shall be
applicable to the shares of stock and other securities and property
receivable on the exercise of this Warrant after the consummation
of such reorganization, consolidation or merger to the effective
date of dissolution following any such transfer, as the case may
be, and shall be binding upon the issuer of any such stock or other
securities, including, in the case of any such transfer, the person
acquiring all or substantially all of the properties or assets of
the Company, whether or not such person shall have expressly
assumed the terms of this Warrant as provided in Section 7.
5. Adjustment for Extraordinary Events. The Purchase Price to be paid
by the Holder upon exercise of this Warrant shall be adjusted in case at any
time or from time to time the Company should (i) subdivide the outstanding
shares of Common Stock into a greater number of shares, (ii) consolidate the
outstanding shares of Common Stock into a smaller number of shares, (iii)
issue
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shares of Common Stock or securities convertible into or exchangeable for
shares of Common Stock as a dividend to all or substantially all holders of
shares of Common Stock or (iv) issue by reclassification of shares of Common
Stock or any shares of capital stock of the Company.
6. Redemption.
6.1. Voluntary Redemption. The Company may at any time, at its
option and following at least ten (10) days prior written notice to
the Holder, redeem (each, a "Redemption") for cash from funds
legally available therefor, up to 50% of the Warrants for a
redemption price per share (the "Redemption Price") equal to $.01
per share of Common Stock (or Other Securities) issuable upon
exercise of this Warrant (the "Warrant Shares") on the Redemption
Date (as hereinafter defined) if the Stock Price (as hereinafter
defined) is equal to or in excess of $15.00, provided, that if the
Stock Price is equal to or in excess of $20.00, then the Company
may redeem up to 100% of the total number of Warrant Shares
underlying this Warrant.
As used herein, "Stock Price" shall mean the closing bid price
for the Common Stock (as specified by Bloomberg, L.P.) during the
20 trading days ending three days prior to the date on which the
Company delivers the Redemption Notice.
6.2. Notice of Redemption. If the Company elects to redeem any
or all of this Warrant pursuant to the terms hereof, the Company
shall give not less than ten (10) days prior written notice of such
Redemption (the "Redemption Notice") to the Holder (together with
each of the other holders of the warrants of the same class hereof)
at such Holder's address as it appears on the books and records of
the Company by facsimile transmission (if such Holder shall have
provided a facsimile number), and the Warrant Shares then subject
to Redemption and not otherwise converted prior to the Redemption
Date shall, on the date which is ten (10) days after the deposit of
Redemption Notice (the "Redemption Date"), cease to be outstanding
and the rights of the Holders and owners thereof shall be limited
to payment of the Redemption Price thereof. The Company shall
deliver the Redemption Price to the Holders in cash or by wire
transfer as indicated by the Holder within two (2) business days of
the Redemption Date. The Redemption Price shall (in the reasonable
discretion of the Board of Directors of the Company) be adjusted to
take into account any stock split or other similar event.
6.3. Selection of Warrant Shares. The Company shall select the
Warrants to be redeemed in a Redemption in which not all Warrants
of this class are to be redeemed so that the Warrant Shares of each
Holder selected for Redemption shall bear the same proportion to
the total Warrant Shares owned by that Holder that the proportion
of all Warrant Shares selected for Redemption bears to the total
number of Warrant Shares. Should any Warrant Shares required to be
redeemed under the terms hereof not be redeemed solely by reason of
limitations imposed by law, the applicable Warrant Shares shall be
redeemed on the earliest possible date that the applicable Warrant
Shares may be redeemed to the maximum extent
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permitted by law. Except as set forth above, the Board of Directors
shall prescribe the manner in which any Redemption shall be effected.
7. No Impairment. The Company will 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 of this Warrant, but will at all times in good faith assist in
the carrying out of all of such terms and in the taking of all such action as
may be necessary or appropriate in order to protect the rights of the Holder
of this Warrant against impairment. Without limiting the generality of the
foregoing, the Company (a) will not increase the par value of any shares of
stock receivable on the exercise of this Warrant above the amount payable
therefor on such exercise, (b) will take all such action as may be necessary
or appropriate in order that the Company may validly and legally issue fully
paid and nonassessable shares of stock on the exercise of this Warrant and
(c) will not transfer all or substantially all of its properties and assets
to any other person (corporate or otherwise), or consolidate with or merge
into any other persons or permit any such person to consolidate with or merge
into the Company (if the Company is not the surviving person), unless such
other person shall expressly assume in writing and will be bound by all the
terms of this Warrant.
8. Notices of Record Date, etc. In the event of
(a) any taking by the Company of a record of the holders
of any class or securities for the purpose of determining the
holders thereof who are entitled to receive any dividend 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 right, or
(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 the assets of
the Company to, or consolidation or merger of the Company with or
into, any other person, or
(c) any voluntary or involuntary dissolution, liquidation
or winding-up of the Company,
then, in each such event, the Company will mail or cause to be mailed to the
Holder of this Warrant a notice specifying (i) the date on which any such record
is to be taken for the purpose of such dividend, distribution or right, and
stating the amount and character of such dividend, distribution or right, and
(ii) the date on which any such reorganization, reclassification,
recapitalization, transfer, consolidation, merger, dissolution, liquidation or
winding-up is to take place, and the time, if any, as of which the holders of
record of Common Stock (or Other Securities) shall be entitled to exchange their
shares of Common Stock (or Other Securities) for securities or other property
deliverable on such reorganization, reclassification, recapitalization,
transfer, consolidation, merger
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dissolution, liquidation or winding-up. Such notice shall be mailed at least
20 days prior to the date specified in such notice on which any action is to
be taken.
9. Reservation of Stock, etc. Issuable on Exercise of Warrant. The
Company will at all times reserve and keep available, solely for issuance and
delivery on the exercise of this Warrant, all shares of Common Stock (or
Other Securities) from time to time issuable on the exercise of this Warrant.
10. Exchange of Warrant. On surrender for exchange of this Warrant,
properly endorsed, to the Company, the Company at is expense will issue and
deliver to or on the order of the holder thereof of a new Warrant of like
tenor, in the name of such Holder or as such Holder (on payment by such
holder of any applicable transfer taxes) may direct, calling in the aggregate
on the face or faces thereof for the number of shares of Common Stock called
for on the face of the Warrant so surrendered.
11. Replacement of Warrant. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and, in the case of any such loss, theft or destruction of this
Warrant, on delivery of an indemnity agreement or security reasonably
satisfactory in form and amount to the Company or, in the case of any such
mutilation or surrender and cancellation of this Warrant, the Company at its
expense will execute and deliver, in lieu thereof, a new Warrant of like
tenor.
12. Remedies. The Company stipulates that the remedies at law of the
Holder of this Warrant in the event of any default by the Company in the
performance of or compliance with any of the terms of this Warrant are not
and will not be adequate, and that 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.
13. Negotiability, etc. This Warrant is issued upon the following terms,
to all of which each Holder or owner hereof by the taking hereof consents and
agrees:
(a) title to this Warrant may be transferred by
endorsement (by the Holder hereof executing the form of assignment
at the end hereof) and delivery in the same manner as in the case
of a negotiable instrument transferable by endorsement and delivery;
(b) any person in possession of this Warrant properly
endorsed is authorized to represent himself as absolute owner
hereof and is empowered to transfer absolute title hereto by
endorsement and delivery hereof to a bona fide purchaser hereof for
value; each prior taker or owner waives and renounces all of his
equities or rights in this Warrant in favor of each such bona fide
purchaser, and each such bona fide purchaser shall acquire absolute
title hereto and to all rights represented hereby;
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(c) until this Warrant is transferred on the books of the
Company, the Company may treat the registered Holder hereof as the
absolute owner hereof for all purposes, notwithstanding any notice
to the contrary; and
(d) notwithstanding the foregoing, this Warrant may not
be sold, transferred or assigned except pursuant to an effective
registration statement under the Securities Act or, pursuant to an
applicable exemption therefrom (including in accordance with
Regulation D promulgated under the Securities Act).
14. Notices, etc. All notices and other communications from the Company
to the Holder of this Warrant shall be mailed by first class registered or
certified mail, postage prepaid, at such address as may have been furnished
to the Company in writing by the Holder or, until any the Holder furnishes to
the Company an address, then to, and at the address of, the last Holder of
this Warrant who has so furnished an address to the Company.
15. Miscellaneous. This Warrant and any term hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by
the party against which enforcement of such change, waiver, discharge or
termination is sought. This Warrant shall be construed and enforced in
accordance with and governed by the internal laws of the State of New York,
except where the Delaware General Corporation Law applies. The headings in
this Warrant are for purposes of reference only, and shall not limit or
otherwise affect any of the terms hereof. This Warrant is being executed as
an instrument under seal. The invalidity or unenforceability of any
provision hereof shall in no way affect the validity or enforceability of any
other provision.
[SIGNATURE PAGE FOLLOWS]
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DATED as of August __, 1997.
VISUAL EDGE SYSTEMS INC.
By:______________________________
Name:____________________________
Title:___________________________
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EXHIBIT A
FORM OF NOTICE OF EXERCISE
(To be executed only upon exercise or conversion
of the Warrant in whole or in part)
To Visual Edge Systems Inc.
The undersigned registered holder of the accompanying Warrant hereby
exercises such Warrant or portion thereof for, and purchases thereunder,
__________(1) shares of Common Stock (as defined in such Warrant) and herewith
makes payment therefor of $___________. The undersigned requests that the
certificates for such shares of Common Stock be issued in the name of, and
delivered to, __________________________ whose address is _____________________
_______________________________________________________.
Dated:________________________
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(Name must conform to name of holder
as specified on the face of the Warrant)
By:____________________________________
Name:_______________________________
Title:______________________________
Address of holder:
_______________________________________
_______________________________________
_______________________________________
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(1) Insert the number of shares of Common Stock as to which the accompanying
Warrant is being exercised. In the case of a partial exercise, a new Warrant
or Warrants will be issued and delivered, representing the unexercised
portion of the accompanying warrant, to the holder surrendering the same.
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