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Exhibit 4.1
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE
OF
THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933,
AS
AMENDED, OR ANY STATE SECURITIES LAWS. THIS WARRANT AND THE
COMMON
STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT BE SOLD,
OFFERED
FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
EFFECTIVE
REGISTRATION STATEMENT AS TO THIS WARRANT UNDER SAID ACT AND
ANY
APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL
REASONABLY
SATISFACTORY TO TRIMEDIA ENTERTAINMENT GROUP, INC. THAT SUCH
REGISTRATION IS NOT REQUIRED.
Right to Purchase 2,000,000 Shares of Common Stock of
TriMedia Entertainment Group, Inc.
(subject to adjustment as provided herein)
COMMON STOCK PURCHASE WARRANT
No. _________________
Issue Date: May 5,
2005
TRIMEDIA ENTERTAINMENT GROUP, INC., a corporation organized under
the
laws of the State of Delaware ("TriMedia
Entertainment Group, Inc."), hereby
certifies that, for value received, IL
RESOURCES, LLC, or assigns (the
"Holder"), is entitled, subject to the
terms set forth below, to purchase from
the Company (as defined herein) from and
after the Issue Date of this Warrant
and at any time or from time to time before
5:00 p.m., New York time, through
the close of business May 5, 2010 (the
"Expiration Date"), 2,000,000 fully paid
and nonassessable shares of Common Stock
(as hereinafter defined), $0.001 par
value per share, at the applicable Exercise
Price per share (as defined below).
The number and character of such shares of
Common Stock and the applicable
Exercise Price per share are subject to
adjustment 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 TriMedia Entertainment
Group, Inc. and any corporation which shall succeed, or assume
the
obligations of, TriMedia Entertainment Group, Inc. hereunder.
(b) The term "Common Stock" includes (i) the Company's Common
Stock, par value $0.001 per share; and (ii) any other securities
into
which or for which any of the securities described in (i) 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) which the holder of the Warrant at
any
time shall be entitled to receive, or shall have received, on
the
exercise of the Warrant, in lieu of or in addition to Common Stock,
or
which 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.
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(d) The "Exercise Price" applicable under this Warrant shall
be $.50.
1.
Exercise of Warrant.
1.1 Number of Shares Issuable upon Exercise. From and after
the date hereof through and including the
Expiration Date, the Holder shall be
entitled to receive, upon exercise of this
Warrant in whole or in part, by
delivery of an original or fax copy of an
exercise notice in the form attached
hereto as Exhibit A (the "Exercise
Notice"), shares of Common Stock of the
Company, subject to adjustment pursuant to
Section 4.
1.2 Fair Market Value. For purposes hereof, the "Fair Market
Value" of a share of Common Stock as of a
particular date (the "Determination
Date") shall mean:
(a) If the Company's Common Stock is traded on the American
Stock Exchange or another national exchange or is quoted on the
National or SmallCap Market of The Nasdaq Stock Market,
Inc.("Nasdaq"),
then the closing or last sale price, respectively, reported for
the
last business day immediately preceding the Determination Date.
(b) If the Company's Common Stock is not traded on the
American Stock Exchange or another national exchange or on the
Nasdaq
but is traded on the NASD OTC Bulletin Board, then the mean of
the
average of the closing bid and asked prices reported for the
last
business day immediately preceding the Determination Date.
(c) Except as provided in clause (d) below, if the Company's
Common Stock is not publicly traded, then as the Holder and the
Company
agree or in the absence of agreement by arbitration in accordance
with
the rules then in effect of the American Arbitration
Association,
before a single arbitrator to be chosen from a panel of persons
qualified by education and training to pass on the matter to be
decided.
(d) If the Determination Date is the date of a liquidation,
dissolution or winding up, or any event deemed to be a
liquidation,
dissolution or winding up pursuant to the Company's charter, then
all
amounts to be payable per share to holders of the Common Stock
pursuant
to the charter in the event of such liquidation, dissolution or
winding
up, plus all other amounts to be payable per share in respect of
the
Common Stock in liquidation under the charter, assuming for the
purposes of this clause (d) that all of the shares of Common Stock
then
issuable upon exercise of the Warrant are outstanding at the
Determination Date.
2
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2.
Procedure for Exercise.
2.1 Delivery of Stock Certificates, Etc., on Exercise. The
Company agrees that the shares of Common
Stock purchased upon exercise of this
Warrant shall be deemed to be issued to the
Holder as the record owner of such
shares as of the close of business on the
date on which this Warrant shall have
been surrendered and payment made for such
shares in accordance herewith. As
soon as practicable after the exercise of
this Warrant in full or in part, and
in any event within three (3) business days
thereafter, the Company at its
expense (including the payment by it of any
applicable issue taxes) will cause
to be issued in the name of and delivered
to the Holder, or as such Holder (upon
payment by such Holder of any applicable
transfer taxes) may direct in
compliance with applicable securities laws,
a certificate or certificates for
the number of duly and validly issued,
fully paid and nonassessable shares of
Common Stock (or Other Securities) to which
such Holder shall be entitled on
such exercise, plus, in lieu of any
fractional share to which such holder would
otherwise be entitled, cash equal to such
fraction multiplied by the then Fair
Market Value of one full share, together
with any other stock or other
securities and property (including cash,
where applicable) to which such Holder
is entitled upon such exercise pursuant to
Section 1 or otherwise.
2.2 Exercise. Payment may be made either (i) in cash or by
certified or official bank check payable to
the order of the Company equal to
the applicable aggregate Exercise Price,
(ii) by delivery of the Warrant, or
shares of Common Stock and/or Common Stock
receivable upon exercise of the
Warrant in accordance with the formula
below, or (iii) by a combination of any
of the foregoing methods, for the number of
Common Shares specified in such
Exercise Notice (as such exercise number
shall be adjusted to reflect any
adjustment in the total number of shares of
Common Stock issuable to the Holder
per the terms of this Warrant) and the
Holder shall thereupon be entitled to
receive the number of duly authorized,
validly issued, fully-paid and
non-assessable shares of Common Stock (or
Other Securities) determined as
provided herein. Notwithstanding any
provisions herein to the contrary, if the
Fair Market Value of one share of Common
Stock is greater than the Exercise
Price (at the date of calculation as set
forth below), in lieu of exercising
this Warrant for cash, the Holder may elect
to receive shares equal to the value
(as determined below) of this Warrant (or
the portion thereof being exercised)
by surrender of this Warrant at the
principal office of the Company together
with the properly endorsed Exercise Notice
in which event the Company shall
issue to the Holder a number of shares of
Common Stock computed using the
following formula:
X = Y x
(A-B)
-----
A
Where X = the number of shares of Common Stock to be issued to
the
Holder
Y = the
number of shares of Common Stock purchasable under the
Warrant or, if only a portion of the Warrant is being
exercised, the portion of the Warrant being exercised (at the
date of such calculation)
A = the
Fair Market Value of one share of the Company's Common
Stock (at the date of such calculation)
B =
Exercise Price (as adjusted to the date of such calculation)
3
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3.
Effect of Reorganization, Etc.; Adjustment of Exercise Price.
3.1
Reorganization, Consolidation, Merger, 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, as a condition to the consummation of
such a transaction, proper and
adequate provision shall be made by the
Company whereby the Holder of this
Warrant, on 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 or such effective date, the
stock and other securities and property
(including cash) to which such Holder would
have been entitled upon such
consummation or in connection with such
dissolution, as the case may be, if such
Holder had so exercised this Warrant,
immediately prior thereto, all subject to
further adjustment thereafter as provided
in Section 4.
3.2 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, concurrently with any
distributions made to holders of its
Common Stock, shall at its expense deliver
or cause to be delivered to the
Holder the stock and other securities and
property (includi
