THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (COLLECTIVELY "ACT"), OR REGISTERED OR QUALIFIED UNDER ANY APPLICABLE
STATE SECURITIES LAWS. NO TRANSFER, SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION OR
OTHER DISPOSITION OF THIS WARRANT MAY BE MADE EXCEPT (A) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, OR (B) IF THE COMPANY HAS BEEN
FURNISHED WITH A SATISFACTORY OPINION OF COUNSEL FOR HOLDER THAT SUCH TRANSFER,
SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION OR OTHER DISPOSITION IS EXEMPT FROM THE
PROVISIONS OF REGISTRATION REQUIREMENTS OF THE ACT, AND FROM ANY REGISTRATION OR
QUALIFICATION REQUIREMENTS OF ALL APPLICABLE STATE SECURITIES LAWS.
LASER-PACIFIC MEDIA CORPORATION
WARRANT TO PURCHASE 250,000 SHARES
OF THE COMMON STOCK OF
LASER-PACIFIC MEDIA CORPORATION
Dated: July ___, 1997
THIS CERTIFIES THAT, for value received, 00 XXXX XXXXXX, x Xxxxxxxxxx
limited partnership ("Holder"), is entitled to subscribe for and purchase,
subject to the provisions of this Warrant, from LASER-PACIFIC MEDIA CORPORATION,
a Delaware corporation (the "Company"), 250,000 (subject to adjustment pursuant
to Section 4 hereof) fully paid and non-assessable shares of the Common Stock of
the Company ("Warrant Shares") at the price of One Dollar ($1.00) per Share
(such price and such other price as shall result, from time to time, from the
adjustments specified in Section 4 hereof herein referred to as the "Warrant
Price"), subject to the provisions and upon the terms and conditions hereinafter
set forth. As used herein, (a) the term "Common Stock" shall mean the Company's
authorized common stock, and any stock into or for which such Common Stock may
hereafter be converted or exchanged, (b) the term "Grant Date" shall mean the
date first above written, and (c) the term "Other Warrants" shall mean any
warrant issued upon transfer or partial exercise of this Warrant. The term
"Warrant" as used herein shall be deemed to include Other Warrants unless the
context clearly requires otherwise.
1. Term. The purchase right represented by this Warrant is exercisable,
in whole or in part, at any time and from time to time up to and terminating on
a date two (2) years from the date of the Grant Date ("Expiration Date").
2. Method of Exercise; Payment; Issuance of New Warrant. Subject to Section
1 hereof, the purchase right represented by this Warrant may be exercised at any
time up to the Expiration Date by the Holder, in whole or in part, at the
election of the Holder, by the surrender of this Warrant (with the notice of
exercise substantially in the form attached hereto as Exhibit "A" duly completed
and executed) at the principal office of the Company and by the payment to the
Company, by xxxxxxx's check or by wire transfer to an account designated by the
Company of an amount equal to the then applicable Warrant Price multiplied by
the number of Warrant Shares being purchased. The person or persons in whose
name(s) any certificate(s) representing shares of Common Stock shall be issuable
upon exercise of this Warrant shall be deemed to have become the holder(s) of
record of, and shall be treated for all purposes as the record holder(s) of, the
shares represented thereby (and such shares shall be deemed to have been issued)
immediately prior to the close of business on the date or dates upon which this
Warrant is exercised in accordance with the provisions of this Warrant. In the
event of any such exercise of the rights represented by this Warrant,
certificates for the Warrant Shares so purchased shall be delivered to the
holder hereof as soon as possible and in any event within thirty (30) days after
such exercise.
3. Stock Fully Paid; Reservation of Shares. All shares of Common Stock that
may be issued upon the exercise of the rights represented by this Warrant shall,
upon issuance pursuant to the terms and conditions herein, be fully paid and
non-assessable, and free from all liens and charges with respect to the issue
thereof. During the period within which the rights represented by this Warrant
may be exercised, the Company shall at all times have authorized, and reserved
for the purpose of issuance upon exercise of the purchase rights evidenced by
this Warrant, a sufficient number of shares of its Common Stock to provide for
the exercise of the rights represented by this Warrant.
4. Adjustment of Exercise Price and Number of Warrant Shares Issuable. The
Exercise Price and the number of Warrant Shares issuable upon the exercise of
this Warrant are subject to adjustment from time to time upon the occurrence of
the events enumerated in this Section 4.
In the event that the outstanding shares of Common Stock subject to this
Warrant are changed into or exchanged for a different number or kind of shares
or other securities by reason of merger, consolidation, recapitalization,
reclassification, stock split-up, stock dividend or combination of shares, an
appropriate and equitable adjustment shall be made in the number and kind of
shares as to which this Warrant, or portions hereof then unexercised, shall be
exercisable, to the end that after such event the Holder's proportionate
interest shall be maintained as immediately before the occurrence of such event.
Such adjustment shall be made without change in the total price applicable to
this Warrant or the unexercised portion hereof (except for any change in the
aggregate price resulting from rounding-off of share quantities or prices) and
with any necessary corresponding adjustment in Warrant Price per Warrant Share.
5. Fractional Shares. No fractional shares of Common Stock shall be issued
in connection with any exercise hereunder, but in lieu of such fractional shares
the Company shall make a cash payment therefor based on the fair market value
of the Common Stock on the date of exercise as reasonably determined in good
faith by the Company's Board of Directors.
6. Deemed Representations and Covenants of Holder.
(a) By acceptance of this Warrant, Holder represents and warrants to
the Company that it is acquiring the Warrant, and shall acquire the Warrant
Shares, for investment, for its own account and not with a view towards the
resale or distribution thereof.
(b) By acceptance of this Warrant, Holder hereby agrees that it shall
not sell, transfer by any means or otherwise dispose of the Warrant or the
Warrant Shares acquired by it without registration under the Securities Act of
1933, as amended, and all applicable regulations promulgated thereunder (the
"Federal Act"), and under any applicable state securities laws and all
applicable regulations promulgated thereunder ("State Acts"), unless (i)
exemptions from registration under the Federal Act and all applicable State Acts
are available thereunder, and (ii) Holder has furnished the Company with notice
of such proposed transfer and an opinion of Xxxxxx's legal counsel, which
counsel and opinion is reasonably acceptable to the Company, that such proposed
sale or transfer is so exempt.
(c) By acceptance of this Warrant, Xxxxxx acknowledges that:
(i) Holder must bear the economic risk of the investment proposed
herein for an indefinite period of time because the Warrant Shares will not have
been registered under the Act and cannot be sold by Holder unless they are
registered under the Act or an exemption therefrom is available thereunder.
(ii) Xxxxxx has had both the opportunity to ask questions of and
receive answers from the officers and directors of the Company and all persons
acting on its behalf concerning the Warrant, the Warrant Shares and the terms
and conditions hereof and to obtain any additional information, to the extent
the Company possesses or may possess such information or can acquire it without
unreasonable effort or expense, necessary for Holder to make the investment in
the Company contemplated hereby.
(iii) The Company shall place stop transfer orders with its
transfer agent against the transfer of the Warrant and the Warrant Shares in the
absence of registration under the Act or an exemption therefrom thereunder as
provided herein.
7. Rights as Shareholders; Information. No holder of this Warrant, as such,
shall be entitled to vote or receive dividends or be deemed the holder of any
Warrant Shares or any other securities of the Company which may at any time be
issuable on the exercise hereof for any purpose, nor shall anything contained
herein be construed to confer upon Holder, as such, any of the rights of a
shareholder of the Company or any right to vote for the election of directors or
upon any matter submitted to shareholders at any meeting thereof, or to receive
notice of meetings, or to receive dividends or subscription rights or otherwise
receive any distribution of any nature in respect of any Warrant Shares until
this Warrant shall have been exercised and the Warrant Shares purchasable upon
the exercise hereof shall have become deliverable, as provided herein.
8. Modification and Waiver. This Warrant and any provision hereof may be
changed, waived, discharged or terminated only by an instrument in writing
signed by the party against which enforcement of the same is sought.
9. Notices. All notices and demands, all responses thereto and any other
instruments of any kind (collectively "Notices"), which any party may require,
or desires, to be provided or served on any party shall be written, dated, state
its purpose and the time during which to respond, and served on the respective
parties at the addresses set forth on the signature pages hereto or as may
otherwise be directed in writing. Service shall be deemed made, and received, if
personally, at the time of such service: if by certified or registered mail,
within three (3) business days after deposited in the United States mail within
the state of California, or within five (5) business days after deposited in the
United States mail outside of the state of California, provided postage is
prepaid and the Notice is properly addressed; if by courier or overnight service
(such as Federal Express, DHL or UPS), at the time the agency confirms delivery;
and if by telegraph, telefacsimile or telex, at the time the machine or agency
confirms delivery, provided that within two (2) business days thereafter the
original thereof shall have been sent by mail (as herein provided) to the party
to whom such Xxxxxx was directed. All Notices shall be deemed deposited for mail
purposes as of the date of its postmark. Refusal of acceptance of any Notice
served in accordance herewith shall not affect the service thereof as otherwise
provided herein. Each party hereto shall promptly give notice to each other
party of any change of its address or number. If such change notice is not
served, the notifying party(s) shall be entitled to rely upon the address and
numbers herein last provided.
10. Binding Effect on Successors. This Warrant shall be binding upon Holder
and upon any corporation succeeding the Company by merger, consolidation or
acquisition of all or substantially all of the Company's assets, and all of the
obligations of the Company relating to the Warrant Shares issuable upon the
exercise or conversion of this Warrant shall survive the exercise, conversion
and termination of this Warrant and all of the covenants and agreements of the
Company shall inure to the benefit of all permitted successors and assigns of
the Holder. The Company shall, at the time of the exercise or conversion of this
Warrant, in whole or in part, upon request of Xxxxxx, at the Company's expense,
acknowledge in writing its continuing obligation to Holder in respect of any
rights (including any right to registration of the Warrant Shares) to which
Holder shall continue to be entitled after such exercise or conversion in
accordance with this Warrant; provided, that the failure of Holder to make any
such request shall not affect the continuing obligation of the Company to Holder
in respect of such rights.
11. Lost Warrants or Stock Certificates. Upon 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, upon receipt of an indemnity reasonably satisfactory to the
Company, or in the case of any such mutilation upon surrender and cancellation
of this Warrant, the Company shall make and deliver a replacement Warrant in
lieu of the lost, stolen, destroyed or mutilated Warrant.
12. Descriptive Headings. The descriptive headings of the several
paragraphs of this Warrant are inserted for convenience only and do not
constitute a part of this Warrant. The language in this Warrant shall be
construed as to its fair meaning without regard to which party drafted this
Warrant.
13. Governing Law. This Warrant shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the laws of
the State of California, except as preempted or otherwise controlled by any
applicable Federal Law in which case such Federal Law shall apply.
14. Jurisdiction and Venue. The parties agree that any disputes concerning
this Warrant shall be litigated, whether by a court or by arbitration, only
within the County of Los Angeles, California, which the parties agree for
jurisdictional purposes is the place where this Warrant has been entered into
and where it will be substantially performed. In the event any party institutes
any legal action to collect or otherwise enforce any provision of this Warrant,
the prevailing party shall be entitled to reasonable attorney fees and costs.
15. Entire Agreement; Modification. This Warrant together with the
Company's Short-Term Installment (Fixed Rate) Line of Credit Note issued to
Holder concurrently herewith, and all exhibits, schedules or other attachments
thereto (collectively, "Documents"), is intended by the parties as a final
expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein and therein. This Warrant, together with the
other Documents, supersedes all prior agreements and understandings between the
parties with respect to such subject matter and shall constitute the final and
binding agreement of the parties with respect to such subject matter, except as
otherwise explicitly provided herein. It is the intent of the parties that this
Warrant and the Warrant Shares fully comply with all applicable laws. To the
extent that this Warrant or any Warrant Shares do not comply, the Company shall
be entitled to modify this Warrant and the Warrant Shares in order that the same
complies with such applicable laws and Holder shall comply therewith.
LASER-PACIFIC MEDIA CORPORATION,
a Delaware corporation
By:____________________________________
Its:_____________________________
000 Xxxxx Xxxxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
EXHIBIT A
NOTICE OF EXERCISE
To: Laser-Pacific Media Corporation
1. The undersigned hereby elects to purchase ______ (____) shares of Common
Stock of Laser-Pacific Media Corporation pursuant to the terms of the attached
Warrant dated ___________, 1997, and tenders herewith payment of the purchase
price of such shares in full.
2. Please issue a certificate or certificates representing said shares in
the name of the undersigned or in such other name or names as are specified
below:
Print Name:_________________________________
Undersigned Status (check one as appropriate):
( ) A married person
( ) Husband and wife as community property
( ) As sole and separate person
( ) As tenants-in-common
( ) As joint tenants with rights of survivorship
( ) a general partnership established and maintained in good
standing upon the laws of _______________________________.
( ) a limited partnership established and maintained in good
standing upon the laws of____________________________ with
_______________, a __________________ as the general partner.
( ) a limited liability company established and maintained in
good standing upon the laws of _________________________ with
___________________, a ______________________ as the manager.
( ) a corporation established and maintained in good standing upon
the laws of _______________________________.
( ) a trust established and maintained in good standing upon the
laws of ________________________ with _____________________,
a _________________________ as trustee.
( ) a _____________________________________ established and
maintained in good standing upon the laws of ________________.
Print Address:___________________________________________
___________________________________________
Phone No: (___)_______________
Fax No: (___)_______________
3. The undersigned represents that the aforesaid shares are being acquired
for the account of the undersigned for investment and not with a view to, or for
resale in connection with, the distribution thereof and that the undersigned has
no present intention of distributing or reselling such shares, except as in
compliance with applicable securities laws.
Execution Date:_____________, 199__
By: ___________________________________________
Print Name: ___________________________________________
Print Title: ___________________________________________
Print Address: ___________________________________________
___________________________________________
Phone No: (___)_______________
Fax No: (___)_______________
Social Security or Federal Tax I.D. No.___________________
