EXHIBIT 4.1
Form of Warrant
Warrant to Purchase Common Stock of Kirshner Entertainment & Technologies, Inc.
FOR VALUE RECEIVED, Kirshner Entertainment & Technologies, Inc. , a Florida
corporation (the "Company"), promises to issue in the name of, and sell and
deliver to ____________________________________________________ (the "Holder") a
certificate or certificates for an aggregate of
____________________________________________shares of the Company's common
stock, par value $0.0005 per share (the "Common Stock"), upon payment by the
Holder of $.10 per share (the "Exercise Price"),
A. Exercise of Warrant
B. Exercise Period. The Holder may exercise this Warrant, in whole or in part
(but not as to fractional shares), at any time and time to time commencing on
the date hereof and ending at 5:00 p.m., Eastern Time, and expiring on July 1,
2008 (the "Exercise Period").
C. Exercise Procedure.
1. 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"):
2. a completed Exercise Agreement, executed by the Holder (the "Purchaser"); and
3. In lieu of exercising the Warrant by paying the exercise price in cash, the
Warrant ma be exercised in whole at any time or in part from time to time prior
to the expiration date of the Warrant, by the Holder by surrendering the Warrant
to the Company, without payment of any other consideration, together with a duly
executed notice of exercise in a form satisfactory to the Company. The number of
common shares to be issued by the Company shall be calculated using the
following formula:
X = Y(A-B)
------
A
Where X = the number of common shares to be issued
to the Holder
Y = the number of common shares purchasable under the
warrant or, if the Warrant is being exercised in
part, under the portion of the Warrant being
exercised (at the date of surrender of the Warrant
and the notice of exercise)
A = the Market Price (at the date of surrender and
the notice of exercise)
B = the per share Warrant exercise price (as adjusted
to the date of surrender of the Warrant and the
notice of exercise)
4. Certificates for the shares of Common Stock purchased upon exercise of this
Warrant will be delivered by the Company to the Purchaser within ten (10)
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 representing the rights formerly represented by this
Warrant that have not expired or been exercised. The Company will, within such
ten (10) day period, deliver such new Warrant to the Holder at the address set
forth in this Warrant.
5. The shares of Common Stock issuable upon the exercise of this Warrant will be
deemed to have been transferred to the Purchaser on the Exercise Date, and the
Purchaser will be deemed for all purposes to have become the record holder of
such Common Stock on the Exercise Date.
6. The issuance of certificates for shares of Common Stock upon the exercise of
this Warrant will be made without charge to the Purchaser for any issuance tax
in respect thereof or any other cost incurred by the Company in connection with
such exercise and related transfer of the shares; provided, however, that the
Company shall not be required to pay any tax that may be payable in respect of
any transfer involved in the issuance and delivery of any certificate or
instrument in a name other than that of the Holder of this Warrant, and that the
Company shall not be required to issue or deliver any such certificate or
instrument unless and until the person or persons requiring the issue thereof
shall have paid to the Company the amount of such tax or shall have established
to the satisfaction of the Company that such tax has been paid.
7. Unless the Company shall have registered the shares of Common Stock
underlying this Warrant, the shares of Common Stock issuable upon the exercise
of this Warrant will be "restricted securities" as that term is defined in the
Securities Act of 1933. The Company may insert the following or similar legend
on the face of the certificates evidencing shares of Common Stock if required in
compliance with state securities laws:
8. "These securities have not been registered under any state securities laws
and may not be sold or otherwise transferred or disposed of except pursuant to
an effective registration statement under any applicable state securities laws,
or an opinion of counsel satisfactory to counsel to the Company that an
exemption from registration under any applicable state securities laws is
available."
D. Fractional Shares. The Company shall not be required to issue fractions of
shares of Common Stock on the exercise of this Warrant. The Company shall not be
obligated to issue any fractional share interests or fractional warrant
interests upon the exercise of this Warrant, nor shall it be obligated to issue
scrip or pay cash in lieu of fractional interests, provided, however, that if a
holder exercises all the Warrants held of record by such holder, the Company
shall at its option (i) eliminate the fractional interests by rounding any
fraction up to the nearest whole number of shares or (ii) within 30 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 value of such
fractional share as determined by the closing price of the Company's Common
Stock as reported on the principal exchange on which the Company's Common Stock
is then traded, as of the close of business on the Exercise Date.
E. Effect of Reorganization, Reclassification, Consolidation, Merger or Sale
F. Recapitalization or Reclassification of Common Stock. In case the Company
shall at any time prior to the satisfaction of the note underlying this Warrant,
or the Exercise of this Warrant, or the expiration of the Exercise Period,
whichever first occurs, effect a recapitalization or reclassification of such
character that its Common Stock shall be changed into or become exchangeable for
a larger or smaller number of shares, then, upon the effective date thereof, the
number of shares of Common Stock that the Holder of this Warrant shall be
entitled to purchase upon exercise hereof shall be increased or decreased, as
the case may be, in direct proportion to the increase or decrease in such number
of shares of Common Stock by reason of such recapitalization or
reclassification, and the Exercise Price of such recapitalized or reclassified
Common Stock shall, in the case of an increase in the number of shares, be
proportionately decreased and, in the case of a decrease in the number of
shares, be proportionately increased.
G. Consolidation, Merger or Sale. In case the Company shall at any time prior to
the satisfaction of the note underlying this Warrant, or the exercise of this
Warrant, or the expiration of the Exercise Period, whichever first occurs,
consolidate or merge with any other corporation (unless the Company shall be the
surviving entity) or transfer all or substantially all of its assets to any
other corporation preparatory to a dissolution, then the Company shall, as a
condition precedent to such transaction, cause effective provision to be made so
that the Holder of this Warrant, upon the exercise thereof after the effective
date of such transaction, shall be entitled to receive the kind and amount of
shares, evidences of indebtedness, and/or other property receivable on such
transaction by a holder of the number of shares of Common Stock as to which the
Warrant was exercisable immediately prior to such transaction (without giving
effect to any restriction upon such exercise); and, in any such case,
appropriate provision shall be made with respect to the rights and interests of
the Holder hereof to the effect that the provisions of this Warrant shall
thereafter be applicable (as nearly as may be practicable) with respect to any
shares, evidences of indebtedness, or other securities or assets thereafter
deliverable upon exercise of this Warrant.
H. Notice of Adjustment. Whenever the number of shares of Common Stock
purchasable upon exercise of this Warrant shall be adjusted as provided herein,
the Company shall file with its corporate records a certificate of its Chief
Financial Officer setting forth the computation and the adjusted number of
shares of Common Stock purchasable hereunder resulting from such adjustments,
and a copy of such certificate shall be mailed to the Holder. Any such
certificate or letter shall be conclusive evidence as to the correctness of the
adjustment or adjustments referred to therein and shall be available for
inspection by the holders of the Warrants on any day during normal business
hours.
I. Adjustment to Exercise Price. In the event the Company undertakes an offering
of securities wit an exercise price below the exercise price of the Investor
Warrant included in this offering, the exercise price of the Investor Warrant in
this offering will be reduced to the lowest value of the securities offered by
the Company.
J. Reservation of Common Stock. The Company will at all time reserve and keep
available such number of shares of Common Stock as will be sufficient to permit
the exercise in full of this Warrant. Upon exercise of this Warrant pursuant to
its terms, the Holder will acquire fully paid and non-assessable ownership
rights of the Common Stock, free and clear of any liens, claims or encumbrances
except as otherwise provided herein.
K. No Shareholder Rights or Obligations. This Warrant will not entitle the
Holder hereof to any voting rights or other rights as a shareholder of the
Company. Until the shares of Common Stock issuable upon the exercise of this
Warrant are recorded as issued on the books and records of the Company's
transfer agent, the Holder shall not be entitled to any voting rights or other
rights as a shareholder; provided, however, the Company uses its best efforts to
ensure that, upon receipt of the Exercise Agreement and payment of the Exercise
Price, the appropriate documentation necessary to effectuate the exercise of the
Warrant and the issuance of the Common Stock is accomplished as expeditiously as
possible. No provision of this Warrant, in the absence of affirmative action by
the Holder to purchase Common Stock, and no enumeration in this Warrant of the
rights or privileges of the Holder, will give rise to any obligation of such
Holder for the Exercise Price or as a stockholder of the Company.
L. Transferability. Subject to the terms hereof, this Warrant and all rights
hereunder are transferable, in whole or in part, upon surrender of this Warrant
with a properly executed Assignment in the form of Exhibit 2 hereto at the
principal offices of the Company. This Warrant and the underlying shares of
Common Stock may not be offered, sold or transferred except in compliance with
the Act, and any applicable state securities laws, and then only against receipt
of an agreement of the person to whom such offer or sale or transfer is made to
comply with the provisions of this Warrant with respect to any resale or other
disposition of such securities; provided that no such agreement shall be
required from any person purchasing this Warrant or the underlying shares of
Common Stock pursuant to a registration statement effective under the Act. The
Holder of this Warrant agrees that, prior to the disposition of any security
purchased on the exercise hereof other than pursuant to a registration statement
then effective under the Act, or any similar statute then in effect, the Holder
shall give written notice to the Company, expressing his intention as to such
disposition. Upon receiving such notice, the Company shall present a copy
thereof to its securities counsel. If, in the sole opinion of such counsel,
which such opinion shall not be unreasonably withheld, the proposed disposition
does not require registration of such security under the Act, or any similar
statute then in effect, the Company shall, as promptly as practicable, notify
the Holder of such opinion, whereupon the Holder shall be entitled to dispose of
such security in accordance with the terms of the notice delivered by the Holder
to the Company.
Miscellaneous
M. Notices. Any notices, requests or consents hereunder shall be deemed given,
and any instruments delivered, two days after they have been mailed by first
class mail, postage prepaid, or upon receipt if delivered personally or by
facsimile transmission, as follows:
If to the Company: Kirshner Entertainment & Technologies, Inc.
Xx. 000 Xxxxx Xxxxxx Xxxx, Xxxxxxx Xxxxxxxx,
Xxxxxxxx, Xxxxx, 200436
Attn: Xxx Xxxx Bian
If to the Holder: To the address and/or facsimile of Holder as
recorded in the records of the Company.
except that any of the foregoing may from time to time by written notice to the
other designate another address which shall thereupon become its effective
address for the purposes of this paragraph.
N. Entire Agreement. This Warrant, including the exhibits and documents referred
to herein which are a part hereof, contain the entire understanding of the
parties hereto with respect to the subject matter and may be amended only by a
written instrument executed by the parties hereto or their successors or
assigns. Any paragraph headings contained in this Warrant are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Warrant.
O. Governing Law. This Warrant is governed by, interpreted under and construed
in all respects in accordance with the substantive laws of the State of Florida,
without regard to the conflicts of law provision thereof, and irrespective of
the place of domicile or resident of the party. In the event of a controversy
arising out of the interpretation, construction, performance or breach of this
Warrant, the parties hereby agree and consent to the jurisdiction and venue of
the Courts of the State of Florida, or the United States District Court for the
Southern District of Florida; and further agree and consent that personal
service of process in any such action or preceding outside the State of Florida
shall be tantamount to service in person in Florida.
IN WITNESS WHEREOF, this Warrant has been duly executed and the corporate seal
affixed hereto, all as of the day and year first above written.
Kirshner Entertainment & Technologies, Inc.
By: ________________________________
Its: ________________________________ Date:
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FORM OF INVESTOR EXERCISE AGREEMENT
To: Kirshner Entertainment & Technologies, Inc.
Attn: Xxx Xxxx Bian
Xx. 000 Xxxxx Xxxxxx Xxxx, Xxxxxxx Xxxxxxxx,
Xxxxxxxx, Xxxxx, 000000
Dated:______________________
The undersigned (the "Investor"), pursuant to the provisions set forth
in the attached Warrant (Certificate No. -_______), hereby agrees to subscribe
for the purchase of ___________ shares of the Common Stock (as defined in the
Warrant) (the "Shares") of Kirshner Entertainment & Technologies, Inc., a
Florida corporation (the "Company"), covered by such Warrant and makes payment
herewith in full therefore in the manner and at the price per share provided by
such Warrant.
In connection with the receipt of the Shares, Investor hereby represents,
warrants, covenants and agrees as set forth below.
1. Purchase Entirely for Own Account. The Shares will be acquired for
investment for such Investor's own account, not as a nominee or agent, and not
with a view to the resale or distribution of any part thereof, and Investor has
no present intention of selling, granting any participation in, or otherwise
distributing the Shares or any portion thereof. Further, Investor does not have
any contract, undertaking, agreement or arrangement with any person to sell,
transfer or grant participations to such person or to any third person, with
respect to all or any portion of the Warrant Stock.
2. No Securities Act Registration. Investor understands that, unless
the Investor has been advised by the Company that a current registration
statement is in effect covering the resale of the Shares, the Shares have not
been registered under the Securities Act of 1933, as amended (the "Securities
Act"), by reason of a specific exemption or specific exemptions from the
registration provisions of the Securities Act which depend upon, among other
things, the bona fide nature of Investor's investment intent as expressed
herein.
3. Restricted Securities. Investor acknowledges that, unless the
Investor has been advised by the Company that a current registration statement
is in effect covering the resale of the Shares, because the Shares have not been
registered under the Securities Act, the Shares must be held by the Investor
indefinitely unless subsequently registered under the Securities Act or an
exemption from such registration is available. Investor is aware of the
provision of Rule 144 promulgated under the Securities Act that permits the
limited resale of shares purchased in a private placement subject to the
satisfaction of certain conditions, including, among other things, the
satisfaction of having held the Shares for a certain duration of time, the
availability of certain current public information about the Company, the sale
being through a "broker's transaction" (as provided by Rule 144(f)), and the
volume of shares sold not exceeding specified limitations (unless the sale is
within the requirements of Rule 144(k)).
4. Accredited and Sophisticated Investor. Investor: (a) is an
accredited investor as defined in Rule 501(a) of Regulation D of the Securities
and Exchange Commission; (b)(i) either alone or with Investor's professional
advisor or advisors, has such knowledge and experience in financial and business
matters as to be capable of evaluating the merits and risks of acquiring the
Shares, (ii) either alone by reason of Investor's business or financial
experience or together with Investor's professional advisor or advisors, has the
capacity to protect Investor's interests in connection with acquisition of the
Shares; and (c) is able to bear the economic risk of the investment in the
shares, including a complete loss of the investment.
5. Opportunity to Ask Questions. Investor has had an opportunity to ask
questions of and receive answers from the Company or its representatives
concerning the terms of Investor's investment in Shares, all such questions have
been answered to the full satisfaction of Investor, and Investor has had the
opportunity to request and obtain any additional information Investor deemed
necessary to verify or supplement the information contained therein.
6. Investment Risks. Investor recognizes that an investment in the
Shares involves substantial risks, and is fully aware of and understands all of
the risk factors related to the acquisition of the Shares. Investor has
determined that the acquisition of the Shares is consistent with Investor's
investment objectives. Investor is able to bear the economic risks of an
investment in the Shares, and at the present time could afford a complete loss
of such investment.
7. Limitation on Manner of Offering. The Shares were not offered to
Investor by any means of general solicitation or general advertising.
8. Tax and Other Matters. Investor is not relying on the Company with
respect to tax and other economic considerations involved in the acquisition of
the Shares. Investor has carefully considered and has, to the extent Investor
believes such discussion necessary, discussed with Investor's professional,
legal, tax, accounting and financial advisors the suitability of an investment
in the Shares for Investor's particular tax and financial situation and Investor
has determined that the Shares are a suitable investment for him, her or it.
9. Restrictive Legends. Investor understands that the Shares shall bear
one or more of the following restrictive legends:
(a) "THESE SECURITIES HAVE NOT BEEN REGISTERED OR QUALIFIED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") OR THE SECURITIES LAWS
OF ANY STATE. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF A REGISTRATION STATEMENT IN EFFECT WITH
RESPECT TO THE SECURITIES UNDER THE ACT OR AN OPINION OF COUNSEL SATISFACTORY TO
THE COMPANY TO THE EFFECT THAT SUCH REGISTRATION AND QUALIFICATION UNDER THE ACT
AND SUCH LAWS IS NOT REQUIRED"
(b) Any legend required by applicable state law.
10. Successors. This Exercise Agreement and the representations and
warranties contained herein shall be binding upon the heirs, executors,
administrators, personal representatives and other successors of Investor and
shall inure to the benefit of and be enforceable by the Company.
11. Address. The address, telephone number and facsimile number set
forth at the end of this letter are Investor's true and correct address.
"INVESTOR"
Please issue the
shares as follows:
Name:
-----------------------
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(Print name of Investor)
Address:
-------------------------------- ------------------------
(Sign name of Investor)
Telephone:
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Social Security Number/
Federal EIN:
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