Exhibit 4.1
THIS WARRANT AND ANY SHARES ISSUABLE UPON THE EXERCISE HEREOF HAVE
NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
AMENDED, OR UNDER
ANY STATE SECURITIES LAWS. THIS WARRANT AND SUCH SHARES AND ANY
INTEREST OR
PARTICIPATION HEREIN OR THEREIN MAY NOT BE SOLD, OFFERED FOR SALE,
PLEDGED,
HYPOTHECATED, OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN
EFFECTIVE
REGISTRATION THEREOF UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
AND
APPLICABLE STATE SECURITIES LAWS, OR UNLESS AN EXEMPTION THEREFROM
IS THEN
AVAILABLE. THIS WARRANT AND SUCH SHARES MAY NOT BE TRANSFERRED
EXCEPT UPON THE
CONDITIONS SPECIFIED IN THIS WARRANT, AND NO TRANSFER OF THIS
WARRANT OR SUCH
SHARES SHALL BE VALID OR EFFECTIVE UNLESS AND UNTIL SUCH CONDITIONS
SHALL HAVE
BEEN COMPLIED WITH.
Warrant No. [___]
Date of Issuance: December 28, 2006
Void After February 28, 2011
WARRANT
TO PURCHASE SHARES OF COMMON STOCK OF
MONEY CENTERS OF AMERICA, INC.
__________ Shares of Common Stock
(Subject to Adjustment)
THIS CERTIFIES THAT, for good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, BAENA
ADVISORS, LLC or
its registered assigns (the "Holder") is entitled, subject to the
terms and
conditions set forth below, to purchase from Money Centers of
America, Inc., a
Delaware corporation (the "Company"), _________ shares of common
stock of the
Company, in the aggregate (the "Warrant Shares"), representing
_____% of the
equity capital of the Company on a fully diluted basis, at an
initial exercise
price per share equal to $.01 (initially and as adjusted, if at
all, pursuant to
the terms and conditions of this Warrant, the "Exercise Price").
The maximum
number of Warrant Shares so issuable under this Warrant is
sometimes referred to
as the "Aggregate Number" (as such number may be increased or
decreased, as more
fully set forth herein). This Warrant shall not be terminable by
the Company
prior to the Expiration Date (as defined in Section 1 below). The
term "Warrant"
as used herein shall include this Warrant and any warrants
delivered in
substitution or exchange therefor as provided herein.
While this Warrant is executed and delivered in connection
with that certain Credit and Security Agreement dated as of
December 28, 2006 by
and between the Company and the Holder (the "Credit Agreement"),
this Warrant is
detachable and, accordingly, (a) this Warrant can be transferred
and executed by
the Holder (subject to and in accordance with the terms hereof)
separately from
the Credit Agreement, and (b) the debt issued under the Credit
Agreement and the
rights of the Holder thereunder are separate from this Warrant at
all times
prior to and following the exercise of this Warrant. This Warrant
shall be void
and all rights represented hereby shall cease on the Expiration
Date.
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This Warrant is subject to the following provisions, terms and
conditions:
1. Definitions. As used in this Warrant, unless the context
otherwise requires,
the following terms have the following respective meanings:
"Aggregate Number" shall have the meaning set forth in the
first paragraph of this Warrant.
"Commission" shall mean United States Securities and Exchange
Commission and any other similar or successor agency of the United
States
federal government administering the Securities Act of 1933, as
amended, or the
Securities Exchange Act of 1934, as amended.
"Common Stock" shall mean the shares of common stock of the
Company, currently provided for in the Certificate of Incorporation
of the
Company, and including, for all purposes hereunder, any other
capital stock of
the Company into which such shares of common stock may be converted
or
reclassified or that may be issued in respect of, in exchange for,
or in
substitution of, such common stock by reason of any stock splits,
stock
dividends, distributions, mergers, consolidations or like
events.
"Convertible Securities" shall mean securities convertible
into or exchangeable for Common Stock.
"Distribution" shall have the meaning specified in Section
5(b).
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, and any successor statute or law thereto.
"Expiration Date" shall mean 5:00 p.m., Eastern Time, on
February 28, 2011.
"Person" shall mean an individual, corporation, partnership,
trust or unincorporated organization, or other legal entity, or a
government or
any agency or political subdivision thereof.
"Securities Act" shall mean the Securities Act of 1933, as
amended, and any successor statute or law thereto.
2. Exercise; Issue of Certificates; Payment for Shares.
(a) The purchase rights represented by this Warrant may be
exercised by the
Holder, in whole or in part (but not as to fractional shares of
Common Stock),
at any time, or from time to time, during the term hereof,
commencing upon the
date hereof.
(b) This Warrant shall be exercisable by surrendering this Warrant
and the
Notice of Warrant Exercise attached hereto as Annex 1 (properly
completed and
executed on behalf of the Holder) to the Company as set forth in
Section 14, and
upon payment to the Company of the Exercise Price for the Warrant
Shares being
purchased.
(c) Payment of the Exercise Price may be made, in the sole
discretion of the
Holder, in the form of any of the following: (i) cash, (ii) a
certified or
official bank check payable to the order of the Company or (iii)
wire transfer
of funds to a bank account designated by the Company for such
transfer.
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(d) The shares so purchased upon exercise of this Warrant shall be,
and 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 as provided herein. A certificate
or
certificates for the shares so purchased shall be delivered to the
Holder, as
set forth in Section 14, as promptly as reasonably practicable
following any
exercise of this Warrant, but in no event more than (10) days
thereafter. Unless
this Warrant has been exercised in full or has expired, the Company
shall
execute and deliver to the Holder a new Warrant of like tenor
representing the
number of shares for which this Warrant may then be exercised.
3. No Fractional Shares or Scrip. No fractional shares or scrip
representing
fractional shares shall be issued upon the exercise of this
Warrant. In lieu of
any fractional shares to which the Holder would otherwise be
entitled, the
Company shall make a cash payment equal to the fair market value of
a share
multiplied by such fraction.
4. Shares to be Fully Paid; Reservation of Shares; Listing. The
Company
covenants and agrees that: (a) all Warrant Shares will, upon
issuance, be
original-issue shares (and not treasury stock), fully paid and
nonassessable and
free from all taxes, claims, liens, charges and other encumbrances
with respect
to the issue thereof (other than taxes in respect of any transfer
occurring
contemporaneously or otherwise specified herein and except for
liens imposed by
any state or federal securities laws or created by the Holder); (b)
during the
period within which the rights represented by this Warrant may be
exercised, the
Company will at all times have authorized and reserved for the
purpose of issue
or transfer upon exercise of this Warrant a sufficient number of
original-issue
shares of its Common Stock to provide for the exercise of the
rights represented
by this Warrant; and (c) upon exercise of this Warrant, it will, at
its expense,
promptly notify each securities exchange on which any Common Stock
is at the
time listed of such issuance, and maintain a listing of all shares
of Common
Stock from time to time issuable upon exercise of this Warrant to
the extent
such shares can be listed.
5. Adjustments to Aggregate Number.
The Aggregate Number shall be subject to adjustment from time
to time as follows and thereafter as adjusted shall be deemed to be
the
Aggregate Number hereunder.
(a) In case at any time or from time to time prior to the
Expiration Date the
Company shall:
(i) take a record of the holders of any equity capital of the
Company for the purpose of entitling them to receive a
dividend payable in, or other distribution of, such equity
capital,
(ii) subdivide its outstanding shares of equity capital into a
larger number of shares, or
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(iii) combine its outstanding shares of equity capital into a
smaller number of shares,
then the Aggregate Number in effect immediately prior thereto shall
be adjusted
so that the Holder shall thereafter be entitled to receive, upon
exercise of
this Warrant, the number of shares of Common Stock that such Holder
would have
owned or have been entitled to receive after the occurrence of such
event had
this Warrant been exercised immediately prior to the occurrence of
such event.
(b) In case at any time or from time to time prior to the
Expiration Date, the
Company shall take a record of the holders of its equity capital
for the purpose
of entitling them to receive any dividend or other distribution
(collectively,
a "Distribution") of:
(i) cash (other than dividends payable out of earnings or any
surplus legally available for the payment of dividends under
the laws of the state of incorporation of the Company),
(ii) any evidences of its indebtedness (other than Convertible
Securities), any shares of its capital stock (other than
additional shares of Common Stock or Convertible Securities)
or any other securities or property of any nature whatsoever
(other than cash), or
(iii) any options or warrants or other rights to subscribe
for or purchase any of the following: any evidences of its
indebtedness (other than Convertible Securities), any shares
of its capital stock (other than additional shares of Common
Stock or Convertible Securities) or any other securities or
property of any nature whatsoever,
then the Holder shall be entitled to receive, upon the exercise of
this Warrant
at any time on or after the taking of such record, the number of
shares of
Common Stock to be received upon exercise of this Warrant
determined as stated
herein and, in addition and without further payment, the cash,
stock,
securities, other property, options, warrants and/or other rights
to which such
Holder would have been entitled by way of the Distribution and
subsequent
dividends and distributions if such Holder (x) had exercised this
Warrant
immediately prior to such Distribution, and (y) had retained the
Distribution in
respect of the Common Stock and all subsequent dividends and
distributions of
any nature whatsoever in respect of any stock or securities paid as
dividends
and distributions and originating directly or indirectly from such
Common Stock.
A reclassification of the Common Stock into shares of any other
class of stock
shall be deemed a Distribution by the Company to the holders of its
Common Stock
of such shares of such other class of stock within the meaning of
this paragraph
(b) and, if the outstanding shares of Common Stock shall be changed
into a
larger or smaller number of shares of Common Stock as a part of
such
reclassification, such event shall be deemed a subdivision or
combination, as
the case may be, of the outstanding shares of Common Stock within
the meaning of
paragraph (a) of this Section 5.
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(c) Merger, Sale of Assets, etc. If at any time while this Warrant,
or any
portion hereof, is outstanding and unexpired there shall be (i) a
reorganization
(other than a combination, reclassification, exchange or
subdivision of shares
otherwise provided for herein) of the Company, or any other entity
the stock
or securities of which are at the time deliverable on the exercise
of this
Warrant (such other entity being referred to herein as an "Other
Entity"), (ii)
a merger or consolidation of the Company or an Other Entity with or
into another
entity in which the Company or the Other Entity, as the case may
be, is not the
surviving entity, or a reverse triangular merger in which the
Company or the
Other Entity, as the case may be, is the surviving entity but the
shares of the
Company's or Other Entity's capital stock outstanding immediately
prior to the
merger are converted by virtue of the merger into other property
whether in the
form of securities, cash or otherwise, (iii) a sale or transfer of
the Company's
or an Other Entity's properties and assets as, or substantially as,
an entirety
to any other Person, or (iv) a liquidation of the Company or an
Other Entity,
then this Warrant shall thereafter represent the right to acquire
the number of
shares of stock or other securities which the Holder would have
owned
immediately after the consummation of such reorganization,
merger,
consolidation, sale, transfer, or liquidation if the Holder had
exercised this
Warrant immediately before the effective date of such
reorganization,
merger, consolidation, sale, transfer, or liquidation.
(d) The following provisions shall be applicable to the making of
adjustments of
the Aggregate Number hereinbefore provided for in this Section
5:
(i) The sale or other disposition of any issued shares of
Common Stock owned or held by or for the account of the
Company shall be deemed an issuance thereof for the purposes
of this Section 5.
(ii) The adjustments required by the preceding paragraphs of
this Section 5 shall be made whenever and as often as any
specified event requiring an adjustment shall occur, except as
expressly provided herein. For the purpose of any adjustment,
any specified event shall be deemed to have occurred at the
close of business on the date of its occurrence.
(iii) In computing adjustments under this Section 5,
fractional interests in Common Stock shall be taken into
account to the nearest one-thousandth (.001) of a share and
shall be aggregated until they equal one whole share.
(iv) If the Company shall take a record of the holders of its
Common Stock for the purpose of entitling them to receive a
dividend, distribution, warrants or subscription or purchase
rights under Sections 5(a) through 5(b) hereof, but abandon
its plan to pay or deliver such dividend, distribution,
warrants, subscription or purchase rights, then no adjustment
shall be required by reason of the taking of such record and
any such adjustment previously made in respect thereof shall
be rescinded and annulled.
(e) If any event occurs as to which the other provisions of this
Section 5 are
not strictly applicable but the lack of any provision for the
exercise of the
rights of the Holder would not fairly protect the purchase rights
of such Holder
in accordance with the essential intent and principles of the
provisions of this
Section 5, or, if strictly applicable, would not fairly protect the
conversion
rights of the Holder in accordance with the essential intent and
principles of
such provisions, then the Company shall appoint a firm of
independent certified
public accountants in the United States (which may be the regular
auditors of
the Company) of recognized national standing in the United States
satisfactory
to the Holder, which shall give its opinion as to the adjustments,
if any,
necessary to preserve, without dilution, on a basis consistent with
the
essential intent and principles established in the other provisions
of this
Section 5, the exercise rights of the
