NEITHER THIS WARRANT NOR THE SHARES ISSUABLE UPON THE EXERCISE OF THIS WARRANT
HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"),
OR UNDER ANY APPLICABLE STATE SECURITIES LAWS. NEITHER THIS WARRANT NOR ANY OF
SUCH SHARES MAY BE OFFERED OR TRANSFERRED BY SALE, ASSIGNMENT, PLEDGE OR
OTHERWISE UNLESS (I) A REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER THE ACT
IS IN EFFECT OR (II) THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL, WHICH
OPINION IS REASONABLY SATISFACTORY TO THE COMPANY, TO THE EFFECT THAT SUCH
REGISTRATION IS NOT REQUIRED UNDER THE ACT.
SYNERGY BRANDS INC.
0000 Xxxx Xxxxxxx Xxxx
Xxxxxxxx, XX 00000
COMMON STOCK PURCHASE WARRANT
Date of Issuance: September 24, 2001 Right to Purchase
Shares of Common Stock
Warrant No:
For value received, SYNERGY BRANDS INC., a Delaware corporation (the
"Company"), hereby grants to , or its registered assigns (the "Registered
Holder"), the right to purchase from the Company up to shares of the Company's
Common Stock, par value $.001 per share ("Common Stock") (as adjusted pursuant
to Section 3 hereof), and at the price per share determined initially as
provided in Section 3.1 hereof (as adjusted pursuant to Section 3 hereof). This
Warrant is one of a series of warrants to purchase up to 200,000 shares of
Common Stock issued by the Company in a private offering of Common Stock and
warrants to certain investors (the "Offering").
This Warrant is subject to the following provisions:
1. DEFINITIONS. As used in this Warrant, the following terms have the
meanings set forth below:
"AFFILIATE" of any Person means a Person which controls, is controlled by
or its under common control with, such Person.
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"CAPITAL STOCK" means the Company's Common Stock, preferred stock, and any
other equity securities of the Company.
"COMMON STOCK" means the Company's Common Stock, $.001 par value per share.
"CURRENT MARKET PRICE" means as to any security the average of the daily
closing prices for the 30 consecutive business days ending with the day
immediately prior to the day in question. The closing price for each day shall
be the last reported sales price regular way or, in case no such reported sale
takes place on such day, the average of the reported closing bid and asked
prices regular way, in either case on the principal national securities exchange
on which the security is listed or admitted to trading, or if not listed or
admitted to trading on any national securities exchange, the average of the
highest reported bid and lowest reported asked prices as furnished by the
National Association of Securities Dealers, Inc.'s Automated Quotation System,
or the nearest comparable system, or, in the absence of either, by a nationally
recognized independent investment banking firm selected mutually by the holders
representing a majority of the outstanding Warrants and the Board of Directors
of the Company (or if such selection cannot be made, by a nationally recognized
investment banking firm selected by the American Arbitration Association in
accordance with its commercial rules).
"PERSON" means an individual, a partnership, a corporation, a trust, a
joint venture, a limited liability company, an unincorporated organization, a
government or any department or agency thereof or any other entity.
"WARRANTS" means this Warrant and all other common warrants issued pursuant
to the Offering, and all common stock purchase warrants issued in exchange
therefor pursuant to the terms hereof and thereof.
"WARRANT STOCK" means shares of the Company's authorized but unissued
Common Stock issuable upon the exercise of the Warrants; provided that if there
is a change such that the securities issuable upon exercise of the Warrant are
issued by an entity other than the Company or there is a change in the class of
securities so issuable, then the term "Warrant Stock" will mean one share of the
security issuable upon exercise of the Warrant if such security is issuable in
shares, or will mean the smallest unit in which such security is issuable if
such security is not issuable in shares.
2. EXERCISE OF WARRANT.
2.1 EXERCISE PERIOD. The Registered Holder may exercise this Warrant, in
whole or in part (but not as to a fractional share of Warrant Stock), at any
time and from time to time after the Date of Issuance and prior to 5:00 p.m.
(New York time) on September 24, 2006 (the "Exercise Period").
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2.2 EXERCISE PROCEDURE.
(a) This Warrant will be deemed to have been exercised at such time as the
Company has received all of the following items (the "EXERCISE DATE"):
(i) a completed Exercise Agreement, as described below, executed by the
Person exercising all or part of the purchase rights represented by this
Warrant (the "PURCHASER");
(ii) this Warrant;
(iii) if this Warrant is not registered in the name of the Purchaser,
an Assignment or Assignments in the form set forth in Exhibit II hereto,
evidencing the assignment of this Warrant to the Purchaser; and
(iv) a check payable to the Company (or cash or wire transfer) in an
amount equal to the product of the Exercise Price multiplied by the number
of shares of Warrant Stock being purchased upon such exercise (the
"PURCHASE PRICE").
(b) Certificates for shares of Warrant Stock purchased upon exercise of
this Warrant will be delivered by the Company to the Purchaser within five (5)
business days after the Exercise Date. Unless this Warrant has expired or all of
the purchase rights represented hereby have been exercised, the Company will
prepare a new Warrant, substantially identical hereto, representing the rights
formerly represented by this Warrant which have not expired or been exercised.
The Company will, within such five-day period, deliver such new Warrant to the
Person designated for delivery in the Exercise Agreement.
(c) The Warrant Stock issuable upon the exercise of this Warrant will be
deemed to have been issued to the Purchaser on the Exercise Date, and the
Purchaser will be deemed for all purposes to have become the record holder of
such Warrant Stock on the Exercise Date.
(d) The issuance of certificates for shares of Warrant Stock upon exercise
of this Warrant will be made without charge to the Registered Holder or the
Purchaser for any issuance tax in respect thereof or any other cost incurred by
the Company in connection with such exercise and the related issuance of shares
of Warrant Stock; provided, however, that if the shares of Warrant Stock are to
be issued in a name other than that of the Registered Holder, then such Warrant
Stock shall be delivered only when the person requesting such delivery has paid
to the Company the amount of transfer taxes or charges required in connection
with such issuance, if any.
(e) The Company will not close its books for the transfer of this Warrant
or of any share of Warrant Stock issued or issuable upon the exercise of this
Warrant in any manner which interferes with the timely exercise of this Warrant.
The Company will from time to time take all such action as may be necessary to
assure that the par value per share of the unissued Warrant Stock acquirable
upon exercise of this Warrant is at all times equal to or less than the Exercise
Price then in effect.
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2.3 EXERCISE AGREEMENT. The Exercise Agreement will be substantially in the
form set forth in Exhibit I hereto, except that if the shares of Warrant Stock
are not to be issued in the name of the Registered Holder of this Warrant, the
Exercise Agreement will also state the name of the Person to whom the
certificates for the shares of Warrant Stock are to be issued, and if the number
of shares of Warrant Stock to be issued does not include all the shares of
Warrant Stock purchasable hereunder, it will also state the name of the Person
to whom a new Warrant for the unexercised portion of the rights hereunder is to
be delivered.
2.4 FRACTIONAL SHARES. If a fractional share of Warrant Stock would be
issuable upon exercise of the rights represented by this Warrant, the Company
will, within five (5) days after the Exercise Date, deliver to the Purchaser a
check payable to the Purchaser in lieu of such fractional share, in an amount
equal to the Current Market Price of such fractional share as of the close of
business on the Exercise Date.
3. EXERCISE PRICE AND ADJUSTMENT OF NUMBER OF SHARES.
3.1 GENERAL.
(a) The initial exercise price for the shares which may be purchased
upon the exercise of this Warrant shall be $1.25 per share, or, in case an
adjustment of such price has taken place pursuant to the further provisions
of this Section 3, then at the price as last adjusted and in effect on the
date this Warrant is presented for exercise (such price or such price as
last adjusted, as the case may be, being referred to herein as the
"Exercise Price").
In order to prevent dilution of the rights granted under this Warrant,
the Exercise Price and the number of shares issuable upon exercise of this
Warrant will be subject to adjustment from time to time pursuant to this
Section 3.
(b) If at any time after the Date of Issuance and prior to the Exercise
Date, the Company shall issue any shares of Common Stock or any shares of a
class or series of stock or other securities convertible into Common Stock
("CONVERTIBLE SECURITIES") or any Rights or Related Rights each (as herein
defined) (such Convertible Securities, Rights and Related Rights
collectively the "DERIVATIVE SECURITIES") (including any dividend or other
distribution payable in such Common Stock or Derivative Securities) for a
consideration per share of Common Stock (the consideration in each case to
be determined in the manner provided in Section 3.2(e) or (f) below) less
than the Exercise Price in effect immediately prior to the issuance of such
Common Stock or Derivative Securities, then the Exercise Price in effect
immediately prior to each such issuance shall forthwith be reduced to an
Exercise Price determined by dividing: (x) an amount equal to the sum of
(A) the total number of shares of Common Stock, including the number of
shares of Common Stock issuable upon exercise or conversion of all such
Derivative Securities, outstanding immediately prior to such issuance
multiplied by the Exercise Price in effect immediately prior to such
issuance, plus (B) the aggregate consideration, if any, received by the
Company in connection with such issuance, determined as provided in
Section 3.2, by (y) the total number of shares of Common Stock, including
the number of shares of Common Stock issuable upon exercise or conversion
of all such Derivative Securities, outstanding immediately after such
issuance (including the number of shares of Common Stock into which any
newly issued Derivative Securities are then convertible or issuable upon
the exercise of Rights or Related Rights).
EX-4
3.2 EFFECT OF CERTAIN EVENTS ON ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF
SHARES. For the purpose of determining whether any adjustment of the Exercise
Price pursuant to Section 3.1 is required, the following provisions shall be
applicable:
(a) In the case of the issuance of options or warrants to purchase or
rights to subscribe for Common Stock (collectively, such "RIGHTS"), the
aggregate maximum number of shares of Common Stock deliverable upon
exercise of such Rights shall be deemed to have been issued at the time
such Rights were issued, for a consideration equal to the consideration
(determined in the manner provided in (e) and (f) below), if any, received
by the Company upon the issuance of such Rights, plus the minimum purchase
price provided in such Rights for the Common Stock covered thereby.
(b) In the case of the issuance of Convertible Securities, or options
or warrants to purchase or rights to subscribe for securities by their
terms convertible or exchangeable for Common Stock (collectively, such
"RELATED RIGHTS") the aggregate maximum number of shares of Common Stock
deliverable upon conversion, exchange or exercise of any such Convertible
Securities or such Related Rights shall be deemed to have been issued at
the time such Convertible Securities or such Related Rights were issued and
for a consideration equal to the consideration received by the Company upon
issuance of such Convertible Securities or such Related Rights (excluding
any cash received on account of accrued interest or accrued dividends),
plus the additional consideration, if any, to be received by the Company
upon the conversion, exchange or exercise of such Convertible Securities or
Related Rights (the consideration in each case to be determined in the
manner provided in (e) and (f) below).
(c) On any change in the number of shares of Common Stock deliverable
upon the exercise of such Rights or Related Rights or upon the conversion,
exchange or exercise of such Convertible Securities or on any change in the
minimum purchase price of such Rights, Related Rights or Convertible
Securities other than any change resulting from the anti-dilution
provisions of such Rights, Related Rights or Convertible Securities, the
Exercise Price shall forthwith be readjusted to such Exercise Price as
would have been in effect had the adjustment that was made upon the
issuance of such Rights, Related Rights or Convertible Securities not
converted, exchanged or exercised prior to such change been made on the
basis of such change, but no further adjustment shall be made for the
actual issuance of Common Stock upon the exercise or conversion of any such
Right, Related Right or Convertible Security.
(d) On the expiration of any such Rights, Related Rights or Convertible
Securities, the Exercise Price shall forthwith be readjusted to the
Exercise Price as would have been obtained had the adjustment made upon the
issuance of such Rights or Related Rights or the issuance of any such
Convertible Securities been made upon the basis of the issuance of only the
number of shares of Common Stock actually issued upon the exercise of such
Rights or Related Rights or the conversion, exchange or exercise of any
such Convertible Securities; provided, however, if as a result of such
readjustment following any such expiration the Exercise Price would be
increased and the Registered Holder has previously exercised this Warrant
in full or in part, the Registered Holder will not be obligated to the
Company with respect to the amount of such increase which is applicable to
the shares of Common Stock covered by such previous exercise.
EX-4
(e) In the case of the issuance of such Common Stock or Securities for
cash, the consideration shall be deemed to be the amount of cash paid
therefor.
(f) In the case of the issuance of such Common Stock or Securities for
a consideration in whole or in part other than cash, the consideration
other than cash shall be deemed to be the fair value thereof as determined
in good faith by the Board of Directors of the Company, and a certified
copy of the resolution(s) of the Board of Directors relating to such
determination shall be delivered to the Registered Holder upon request.
(g) In the event of any adjustment to the Exercise Price resulting from
the issuance of any Derivative Securities, no further adjustment shall be
made for the actual issuance of Common Stock upon the exercise or
conversion of any such Derivative Securities.
(h) Anything to the contrary contained in this Section 3.2
notwithstanding, no adjustment shall be made in the Exercise Price as a
result of or pursuant to (i) the granting of any Right or Related Right, or
the issuance of Common Stock to, officers, employees or directors of, or
consultants to, the Company, pursuant to any agreement, plan or arrangement
approved by the Board of Directors of the Company; (ii) the granting of any
Right or Related Right, or the issuance of Common Stock to, providers of
goods and services (including licensees) to the Company in any such case
with the prior approval of the Board of Directors of the Company; or (iii)
a dividend or distribution on any series of preferred stock of the Company;
provided, however, no more than an aggregate of 1,000,000 shares of Common
Stock (including shares of Common Stock underlying grants of Rights or
Related Rights) are issued or reserved for issuance pursuant to clauses
(i), (ii) and (iii) above.
(i) In case the Company shall effect a reorganization, shall merge with
or consolidate into another corporation, or shall sell, transfer or
otherwise dispose of all or substantially all of its property, assets or
business and, pursuant to the terms of such reorganization, merger (other
than a reincorporation transaction), consolidation or disposition of
assets, shares of stock or other securities, property or assets of the
Company, successor or transferee or an affiliate thereof are to be received
by or distributed to the holders of Capital Stock, then each Registered
Holder shall be provided with written notice from the Company informing
each Registered Holder of the terms of such reorganization, merger,
consolidation or disposition of assets and of the record date thereof for
any distribution pursuant thereto, at least 45 days in advance of such
record date, and each Registered Holder shall have, in addition to the
rights provided for herein, the right to receive, at the Registered
Holder's election, either (i) upon exercise of the Warrants held by such
Registered Holder, the number of shares of stock or other securities,
property or assets of the Company, successor or transferee or affiliate
thereof or cash receivable by the holders of the Common Stock upon or as a
result of such reorganization, merger, consolidation or disposition of
assets, or (ii) a new warrant giving such Registered Holder the right to
exercise such new warrant and procure upon such exercise, in lieu of each
share of Common Stock theretofore issuable upon exercise of the predecessor
Warrant, the number of shares of stock or other securities, property or
assets described in clause (i) hereof. The provisions of this paragraph (i)
shall similarly apply to successive reorganizations, mergers,
consolidations or dispositions of assets. The Company shall require any
subsequent issuer of any shares of stock or other securities or property
thereafter deliverable on the exercise of this Warrant to be responsible
for all of the agreements and obligations of the Company hereunder.
EX-4
(j) If the Company shall effect a subdivision of the outstanding Common
Stock, the Exercise Price then in effect immediately before such
subdivision shall be proportionately decreased. If the Company shall
combine the outstanding shares of Common Stock, the Exercise Price then in
effect immediately before the combination shall be proportionately
increased. If the Company shall make or issue a dividend or other
distribution payable in securities, then and in each such event provision
shall be made so that the Registered Holders shall receive upon exercise of
the Warrants in addition to the number of shares of Common Stock receivable
thereupon, the amount of securities that they would have received had their
Warrants been exercised on the date of such event and had they thereafter
during the period from the date of such event to and including the Exercise
Date retained such securities receivable by them as aforesaid during such
period giving effect to all adjustments called for during such period under
this paragraph, with respect to the rights of the Registered Holders.
(k) In case the Company shall distribute to the holders of Common Stock
evidences of indebtedness issued by the Company, or assets (excluding cash
dividends) then, in each such case, immediately following the record date
fixed for the determination of the holders of such securities entitled to
receive such distribution, the Exercise Price in effect thereafter shall be
reduced immediately to the price determined by multiplying the Exercise
Price in effect immediately prior to such record date by a fraction (i) the
numerator of which shall be an amount equal to the remainder of (A) the
Current Market Price of one share of Common Stock, less (B) the fair value
(as determined in good faith by the Company's Board of Directors, and a
certified copy of the resolution(s) of the Board of Directors relating to
such determination shall be delivered to the Registered Holder upon
request) of the evidences of indebtedness or assets so distributed in
respect of one share of Preferred Stock or Common Stock, and (B) the
denominator of which shall be the Current Market Price of one share of
Common Stock. Such adjustment shall be made on the date such distribution
is made, and shall become effective at the opening of business on the
business day following the record date for the determination of
stockholders entitled to such distribution.
(l) In case the Company makes a distribution of its assets or
securities to its shareholders pursuant to any voluntary or involuntary
liquidation, dissolution or winding up of the Company, whether as a
dividend in liquidation or partial liquidation or by way of return of
capital or as a dividend payable out of funds legally available for
dividends, each Registered Holder shall be provided with written notice
from the Company informing the Holder of the terms of such liquidation,
dissolution or winding up, and of the record date thereof for any
distribution pursuant thereto, at least 45 days in advance of such record
date, and the Holder shall have, in addition to any other rights provided
for herein, the right to receive, upon exercise hereof, such assets or
securities as would have been distributable to him or it as owner of that
number of shares of Common Stock receivable upon exercise of this Warrant,
had the holder been the holder of record of such shares on the record date
for such distribution, and an appropriate provision therefor shall be made
a part of any such distribution.
EX-4
(m) Upon the occurrence of each adjustment or readjustment of the
Exercise Price pursuant to this Section 3, the Company at its expense shall
promptly compute such adjustment or readjustment in accordance with terms
hereof and cause its principal financial officer to verify such computation
and prepare and furnish to the Registered Holder a certificate setting
forth such adjustment or readjustment and showing in detail the facts upon
which such adjustment or readjustment is based. The Company shall, upon the
written request at any time of the Registered Holder furnish or cause to be
furnished to such Holder a like certificate setting forth (i) such
adjustments and readjustments, (ii) the Exercise Price in effect at the
time for the Warrant and (iii) the number of shares of Common Stock that at
the time would be received upon the exercise of the Warrant. A copy of each
such certificate shall also be maintained at the principal office of the
Company and at the office of its transfer agent for the Warrants, if any.
(n) In the event of (i) any taking by the Company of a record of the
holders of any class or series of securities for the purpose of determining
the holders thereof who are entitled to receive any dividend or other
distribution or (ii) any reclassification or recapitalization of the
capital stock of the Company, any merger or consolidation of the Company,
or any transfer of all or substantially all of the property and the assets
of the Company to any other Company, entity, or person, or any voluntary or
involuntary dissolution, liquidation, or winding up of the Company, the
Company, unless a notice of record date shall have been mailed to the
Registered Holder pursuant to any other paragraph hereof, shall mail to the
Registered Holder at least 45 days prior to the record date specified
therein, a notice specifying (A) the date on which any such record is to be
taken for the purpose of such dividend or distribution and a description of
such dividend or distribution, (B) the date on which any such
reorganization, reclassification, transfer, consolidation, merger,
dissolution, liquidation, or winding up is expected to become effective,
and (C) the time, if any is to be fixed, as to when 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 upon such reorganization, reclassification, transfer,
consolidation, merger, dissolution, liquidation, or winding up.
3.3 ADJUSTMENT TO NUMBER OF SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE.
Upon each adjustment of the Exercise Price with respect to the Common Stock
pursuant to Section 3.2, the total number of shares of Common Stock issuable
upon the exercise of this Warrant shall be such number of shares of Common Stock
(calculated to the nearest 1/one-thousandth of a share) issuable at the Exercise
Price with respect to such Common Stock in effect immediately prior to such
adjustment multiplied by a fraction, the numerator of which shall be such
Exercise Price in effect immediately prior to such adjustment and the
denominator of which shall be such Exercise Price in effect immediately after
such adjustment.
EX-4
3.4 CERTAIN EVENTS. If any event occurs of the type contemplated by the
provisions of this Section 3 but not expressly provided for by such provisions,
then the Company's Board of Directors will make an appropriate adjustment in the
applicable Exercise Price so as to protect the rights of the Registered Holders;
provided, however, that no such adjustment will increase the applicable Exercise
Price as otherwise determined pursuant to this Section 3 or decrease the number
of shares of Common Stock issuable upon exercise of each Warrant.
4. RESERVATION OF COMMON STOCK. The Company shall at all times reserve and
keep available, free from preemptive rights, solely for issuance upon the
exercise of the Warrants such number of its authorized but unissued shares of
Common Stock as will be sufficient to permit the exercise in full of all
outstanding Warrants, and the Company covenants that upon such issuance such
shares of Common Stock will be validly issued, fully paid and nonassessable, and
free of preemptive or similar rights.
5. LIMITATIONS OF LIABILITY. No provision of this Warrant, in the absence
of affirmative action by the Registered Holder to purchase Warrant Stock, and no
enumeration in this Warrant of the rights or privileges of the Registered
Holder, will give rise to any liability of such Registered Holder for the
Exercise Price of Warrant Stock acquirable by exercise hereof or as a
stockholder of the Company.
6. REGISTRATION, TRANSFER, EXCHANGE AND REPLACEMENT OF WARRANTS.
(a) The Warrants shall be issued in registered form and the Company
shall keep at its principal executive office a register in which, subject
to such reasonable regulations as it may prescribe, but at its expense
(other than transfer taxes, if any), the Company shall provide for the
registration and transfer of the Warrants.
(b) This Warrant and all rights hereunder are transferable, in whole or
in part, without charge to the Registered Holder, upon surrender of this
Warrant with a properly executed Assignment (in the form of Exhibit II
hereto) at the principal office of the Company, provided that any transfer
tax relating to such transaction shall be paid by the holder requesting the
same.
(c) Each Registered Holder of this Warrant acknowledges that this
Warrant has 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 issued upon its exercise in the absence
of (i) an effective registration statement as to this Warrant or such
Warrant Stock under the Act or any similar statute then in effect), or (ii)
an opinion of counsel reasonably satisfactory to the Company to the effect
that such registration is not, under the circumstances, required; provided,
that an opinion of counsel shall not be required for transfers of this
Warrant or interests therein to any partner, stockholder, subsidiary,
parent or Affiliate of the Registered Holder.
EX-4
(d) The Company may treat the person in whose name any Warrant is
registered as the owner of such Warrant for the purpose of receiving shares
of Common Stock upon exercise thereof and for all other purposes. The
Company shall not be affected by any notice to the contrary.
(e) Upon receipt by the Company of evidence satisfactory to it of the
loss, theft, destruction or mutilation of any Warrant and (in case of loss,
theft or destruction) of indemnity satisfactory to it, and upon surrender
and cancellation of such Warrant, if mutilated, the Company at its expense
will execute and deliver in lieu of such security a new security of like
tenor.
7. WARRANT EXCHANGEABLE FOR DIFFERENT DENOMINATIONS. This Warrant is
exchangeable, upon the surrender hereof by the Registered Holder at the
principal office of the Company, for new Warrants of like tenor representing in
the aggregate the purchase rights hereunder, and each of such new Warrants will
represent such portion of such rights as is designated by the Registered Holder
at the time of such surrender, provided that any transfer tax relating to such
transaction shall be paid by the holder requesting the same. The date the
Company initially issues this Warrant will be deemed to be the date of issuance
of this Warrant regardless of the number of times new certificates representing
the unexpired and unexercised rights formerly represented by this Warrant are
issued.
8. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents
and warrants to the Registered Holder that:
(a) ORGANIZATION. The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware, and
is duly qualified as a foreign corporation and is in good standing in each
jurisdiction in which such qualification is required by law, other than
those jurisdictions as to which the failure to be so qualified or in good
standing could not, individually or in the aggregate, reasonably be
expected to have a material adverse effect on the condition (financial or
other), business, prospects, properties, net worth or results of operations
of the Company (a "MATERIAL ADVERSE EFFECT").
(b) POWER AND AUTHORITY; AUTHORIZATION. The Company has all requisite
corporate power and authority to own, lease and operate its properties and
to conduct its business, to execute and deliver this Warrant and to
consummate the transactions contemplated hereby. The execution, delivery
and performance of this Warrant and the consummation transactions
contemplated hereby have been duly authorized by all necessary corporate
action on the part of the Company, and upon execution and delivery, this
Warrant will constitute a legal, valid and binding obligation of the
Company enforceable against the Company in accordance with its terms,
except as may be limited by applicable bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium or similar laws relating to or
affecting creditors' rights generally and by general principles of equity
(regardless as to whether such enforceability is considered in a proceeding
in equity or at law).
EX-4
(c) NO VIOLATION; CONSENTS AND APPROVALS. The execution and delivery by
the Company of this Warrant does not, and the consummation of the
transactions contemplated hereby will not, (i) contravene, result in any
breach of, or constitute a default under, result in the acceleration of ,
create any rights accelerate, terminate, modify or cancel or result in the
creation of any lien in respect of any property of the Company under, any
indenture, mortgage, deed of trust, loan, purchase or credit agreement,
lease, license, corporate charter or bylaws, or any other agreement or
instrument to which the Company is bound or by which the Company or any of
its properties may be bound or affected, (ii) violate, conflict with or
result in a breach of any of the terms, conditions or provisions of any
order, judgment, decree, or ruling of any court, arbitrator or governmental
authority applicable to the Company or its properties or assets or (iii)
violate any provision of any statute or other rule or regulation of any
governmental authority applicable to the Company, except, in each case, as
would not have a Material Adverse Effect.
9. REPORTS OF THE COMPANY.
(a) The Company is subject to the reporting requirements of Sections 13
or 15(d) of the Securities Exchange Act of 1934, as amended (the "EXCHANGE
ACT"). With a view to making available the benefits of certain rules and
regulations of the U.S. Securities and Exchange Commission (the
"COMMISSION") that may permit the resale of unregistered securities, the
Company agrees to use its reasonable best efforts to make and keep public
information regarding the Company available as those terms are understood
and defined in Rule 144 under the Securities Act of 1933, as amended (the
"SECURITIES ACT"), at all times and to file with the Commission in a timely
manner all reports and other documents required by the Company under the
Securities Act and the Exchange Act.
(b) In the event the Company no longer becomes subject to such
reporting requirements, for so long as the Registered Holder beneficially
owns (within the meaning of Rule 13d-3 under the Exchange Act) at least ten
percent (10%) of the outstanding Common Stock of the Company, including the
Warrant Shares owned by the Registered Holder, the Company shall deliver to
the Registered Holder, (i) within 60 days after the end of each fiscal
quarter, copies of a consolidated balance sheet as of the end of such
quarter and consolidated statements of income, changes in stockholders'
equity and cash flows for such quarter and for the portion of the fiscal
year ending with such quarter, setting forth in each case in comparative
form the figures for the corresponding periods in the previous fiscal year,
all in reasonable detail, prepared in accordance with U.S. generally
accepted accounting principles ("GAAP") and (ii) with 120 days after the
end of each fiscal year, copies of a consolidate balance sheet as of the
end of such fiscal year and consolidated statements of income, changes in
stockholders' equity and cash flows for such fiscal year, setting forth in
each case in comparative form the figures for the previous fiscal year, all
in reasonable detail, prepared in accordance with GAAP.
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10. INSPECTION. For as long as the Registered Holder beneficially owns
(within the meaning of Rule 13d-3 under the Exchange Act) at least ten percent
(10%) of the outstanding Common Stock of the Company, including the Warrant
Shares owned by the Registered Holder, the Company shall permit the Registered
Holder to visit and inspect any of the offices and properties of the Company, to
examine all of the books of account, records, reports and other papers, to make
copies and extracts therefrom, and to discuss the Company's affairs, finances
and accounts with its officers and independent public accountants (and by this
provision the Company authorizes said accountants to discuss the affairs,
finances and accounts of the Company), all at such times and as often as may be
reasonably requested.
11. MISCELLANEOUS.
11.1 AMENDMENT AND WAIVER. The provisions of the Warrants may be amended
and the Company may take any action herein prohibited, or omit to perform any
act herein required to be performed by it, only with the affirmative consent or
approval of Registered Holders representing at least 66-2/3% of the shares of
Warrant Stock for which the outstanding Warrants issued in the Offering are
exercisable.
11.2 NOTICES. Any notices required to be sent to a Registered Holder will
be delivered to the address of such Registered Holder shown on the books of the
Company. All notices referred to herein will be delivered in person or sent by
first class mail, postage paid, and will be deemed to have been given when so
delivered or sent.
11.3 DESCRIPTIVE HEADINGS; GOVERNING LAW. The descriptive headings of the
paragraphs of this Warrant are inserted for convenience only and do not
constitute a part of this Warrant. The construction, validity and interpretation
of this Warrant will be governed by the laws of the State of New York without
giving effect to the conflicts of laws principles thereof. The parties consent
to the exclusive jurisdiction of the state and Federal courts located in Nassau
or Suffolk County, New York, to adjudicate any disputes arising hereunder.
11.4 REMEDIES. The Company stipulates that the remedies at law of the
Registered Holder in the event of any default or threatened 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.
11.5 SEVERABILITY. In the event that any provision of this Warrant or the
application thereof becomes or is declared by a court of competent jurisdiction
to be illegal, void or unenforceable, the remainder of this Warrant will
continue in full force and effect and the application of such provision to other
persons or circumstances will be interpreted so as reasonably to effect the
intent of the parties hereto. The parties further agree to replace any such void
or unenforceable provisions of this Warrant with a valid enforceable provision
that will achieve, to the extent possible, the economic, business and other
purposes of such void or unenforceable provision.
11.6 SUCCESSORS, ASSIGNS. All the terms and provisions of this Warrant
shall be binding upon and inure to the benefit of and be enforceable by the
respective successors and assigns of the parties hereto.
11.7 CLARIFICATIONS. The Board of Directors is authorized to amend this
Warrant, or take any further action required, to correct any inconsistency or to
clarify the terms hereof consistent with the intent of the parties.
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IN WITNESS WHEREOF, the Company has caused this Warrant to be signed and
attested by its duly authorized officers under its corporate seal.
SYNERGY BRANDS INC.
by:
-----------------
Xxxx Xxxxxxx
President
ATTEST:
-------------------
Secretary
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EXHIBIT I
EXERCISE AGREEMENT
Dated:
---------------------
To: SYNERGY BRANDS INC.
0000 Xxxx Xxxxxxx Xxxx
Xxxxxxxx, XX 00000
The undersigned, pursuant to the provisions set forth in the within
Warrant, hereby agrees to subscribe for and purchase shares of the Warrant Stock
covered by such Warrant and makes payment herewith in full for such Warrant
Stock at the price per share provided by such Warrant.
Signature:
--------------------------
Address: ---------------------------
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ASSIGNMENT
FOR VALUE RECEIVED, _____________________________ hereby sells, assigns and
transfers all of the rights of the undersigned under the within Warrant with
respect to the number of shares of the Warrant Stock covered thereby set forth
below, unto:
Name of Assignee Address No. of Shares
IN WITNESS WHEREOF, the undersigned sets his hand and seal this ______ day
of _______________, 200__.
--------------------------
Assignor
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