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EXHIBIT 6.7
TOTAL FILM GROUP, INC.
(A Delaware Corporation)
WARRANT CERTIFICATE
WARRANT NUMBER: ___ NUMBER OF WARRANTS: ______
FOR VALUE RECEIVED, Total Film Group, Inc. (the "Company"), a Delaware
corporation, hereby certifies that CAPITAL RESEARCH LTD., a Delaware
corporation, the registered holder hereof, or registered assigns ("Holder") is
entitled to purchase subject to the terms and conditions hereinafter set forth
at any time, or from time to time, on or before 5:00 p.m., Mountain time on
___________ (the "Expiration Date"), and not thereafter one (1) share of the
common stock ("Common Stock") of the Company for each one (1) Warrant exercised,
at a price of $_____ per share of Common Stock (the "Warrant Price"), and
receive a certificate(s) for the Common Stock so purchased, upon presentation
and surrender to the transfer agent for the Company, with the form or
subscription duly executed, and accompanied by payment of the purchase price of
each share purchased, either in cash or by certified check or bank draft,
payable to the order of the Company. Fractional shares of the Company's Common
Stock will not be issued upon the exercise of the Warrant.
THESE WARRANTS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), OR UNDER THE SECURITIES LAWS OF ANY STATE. THESE SECURITIES
HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE TRANSFERRED OR SOLD IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION OR OTHER COMPLIANCE UNDER THE ACT OR THE
LAWS OF THE APPLICABLE STATE OR A "NO ACTION" OR INTERPRETIVE LETTER FROM THE
SECURITIES AND EXCHANGE COMMISSION OR AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO THE ISSUER, AND ITS COUNSEL, TO THE EFFECT THAT THE SALE OR
TRANSFER IS EXEMPT FROM REGISTRATION UNDER THE ACT AND SUCH STATE STATUTES.
The Company covenants and agrees that all shares of Common Stock which
may be delivered upon the exercise of this Warrant will, upon delivery, be free
from all taxes, liens and charges with respect to the purchase thereof
hereunder. This Warrant shall not be exercised by Holder in any state where such
exercise would be unlawful such as a state in which the Company's Common Stock
is not registered. The Company will not attempt to qualify the shares
represented by this Warrant for sale in jurisdictions where holders of the
Company's Warrants reside, unless done as a part of the initial or a subsequent
registration of its securities.
The number of shares of Common Stock purchasable upon the exercise of
this Warrant and the purchase price shall be subject to adjustment from time to
time as set forth herein.
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The Company agrees at all times to reserve or hold available a
sufficient number of shares of its Common Stock to cover the number of shares
issuable upon the exercise of this and all other Warrants of like tenor then
outstanding.
This Warrant does not entitle the Holder to any voting rights or other
rights as a shareholder of the Company, or to any other rights whatsoever except
the rights herein set forth, and no dividend shall be payable to accrue in
respect to this Warrant or the interest represented hereby, or the shares
purchasable hereunder, until or unless, and except to the extent that this
Warrant shall be exercised, and the Common Stock purchasable upon exercise
thereof shall become deliverable.
This Warrant is exchangeable upon the surrender hereof by the Holder to
the Company for new Warrants of like tenor and date representing in the
aggregate the right to purchase the number of shares purchasable hereunder. Each
of such new Warrant certificate shall represent the right to purchase such
number of shares as may be designated by the registered owner at the time of
such surrender, provided that the aggregate of such new Warrant certificates
shall not exceed the total number of shares represented by the this Warrant.
The Company may deem and treat the Holder at any time as the absolute
owner hereof for all purposes and shall not be affected by any notice to the
contrary.
The issuance of this Warrant is subject to the following conditions:
(1) If the Company shall at any time subdivide its outstanding shares
of Common Stock by recapitalization, reclassification or split-up thereof, or if
the Company shall declare a stock dividend or distribute shares of Common Stock
to its stockholders, the number of shares of Common Stock purchasable upon
exercise of this Warrant immediately prior to such subdivision shall be
proportionately increased in each instance, and if the Company shall at any time
combine the outstanding shares of Common Stock by recapitalization,
reclassification or combination thereof, the number of shares of Common Stock
purchasable upon exercise of this Warrant immediately prior to such combination
shall be proportionately decreased in each instance.
(2) If the Company shall distribute to all of the holders of its shares
of Common Stock any security (except as provided in the preceding paragraph) or
other assets (other than a distribution made as a dividend payable out of
earnings or out of any earned surplus legally available for dividends under the
laws of the jurisdiction of incorporation of the Company), the Board of
Directors shall be required to make such equitable adjustment in the Warrant
Price in effect immediately prior to the record date of such distribution as may
be necessary to preserve to the Holder of this Warrant rights substantially
proportionate to those enjoyed hereunder by such Holder immediately prior to the
happening of such distribution. Any such adjustment shall become effective as of
the day following the record date for such distribution.
(3) Whenever the number of shares of Common Stock purchasable upon the
exercise of this Warrant is required to be adjusted, the Warrant Price shall be
adjusted (to the nearest cent) in each instance by multiplying such Warrant
Price immediately prior to such adjustment by a
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fraction (x) the numerator of which shall be the number of shares of Common
Stock purchasable upon the exercise of the Warrants immediately prior to such
adjustment, and (y) the denominator of which shall be the number of shares of
Common Stock so purchasable immediately thereafter.
(4) In case of any reclassification of the outstanding shares of Common
Stock, other that a change covered by paragraph (1) above or which solely
affects the par value of such shares of Common Stock, or in the case of any
merger or consolidation of the Company with or into another corporation (other
that a consolidation merger in which the Company is the continuing corporation
and which does not result in any reclassification or capital reorganization of
the outstanding shares of Common Stock), or in the case of any sale or
conveyance to another corporation of the property of the Company as an entirety
or substantially as an entirety in connection with which the Company is
dissolved, the Holder of this Warrant shall have the right thereafter (until the
expirations of the respective rights of exercise of the Warrant) to receive upon
the exercise thereof, for the same aggregate Warrant Price payable hereunder
immediately prior to such event, the kind and amount of shares of stock or other
securities or property receivable upon such reclassification, capital
reorganization, merger or consolidation, or upon the dissolution following any
sale or other transfer, which a holder of the number of shares of Common Stock
of the Company would obtain upon exercise of the Warrants immediately prior to
such event; and if any classification also results in a change in shares of
Common Stock covered by paragraph (1) above, then such adjustment shall be made
pursuant to both paragraph (1) above and this paragraph (4). The provisions of
this paragraph (4) shall similarly apply to successive reclassifications, or
capital reorganizations, mergers or consolidations, sales or other transfers.
(5) In case of the dissolution, liquidation or winding-up of the
Company, all rights under any of the Warrants not redeemed or expired by their
terms shall terminate on a date fixed by the Company, such date so fixed to be
not earlier than the date of the commencement of the proceedings for such
dissolution, liquidation or winding-up and not later than thirty (30) days after
such commencement date. Notice of such termination or purchase rights shall be
given to the registered Holder of this Warrant as the same shall appear on the
books of the Company, by certified or registered mail at least thirty (30) days
prior to such termination date.
(6) In case the Company shall, at any time prior to the Expiration Date
of the Warrants, and prior to the exercise thereof, offer to the holders of its
Common Stock any right to subscribe for additional shares of any class of the
Company, then the Company shall give written notice thereof to the registered
Holder of this Warrant not less than thirty (30) days prior to the date on which
the books of the Company are closed or a record date fixed for the determination
of stockholders entitled to such subscription rights. Such notice shall specify
the date as to which the books shall be closed or record date be fixed with
respect to such offer or subscription, and the right of the holders to
participate in such offer or subscription shall terminate if this Warrant shall
not be exercised on before the date of such closing of the books or such record
date.
(7) If the Company after the date hereof shall take any action
affecting the shares of its Common Stock, other than that action described
above, which, in the opinion of the Board of Directors of the Company, would
materially affect the rights of the Holder of this Warrant or the
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Warrant Price, the number of shares of Common Stock purchasable on exercise
of this Warrant shall be adjusted in each instance and at such time as the
Board of Directors of the Company, in good faith, may determine to be
equitable under the circumstances.
(8) Following receipt of the written notice of intention to exercise
this Warrant, the Company shall take such steps as it deems appropriate to
permit exercise of the Warrant as specified in the notice and to issue such
shares of Common Stock pursuant to a valid exemption from registration or
qualification under applicable federal and state securities laws; PROVIDED, that
in no event shall the Company be required to consent to the general service of
process or to qualify as a foreign corporation in any jurisdiction where the
Warrant Holder resides if such jurisdiction is different than such Warrant
Holder's residence when the Warrant was originally issued. In order to comply
with exemptions from the registration requirements of the Act and certain state
securities statutes, the Company may require the Holder of this Warrant to make
certain representations and execute and deliver to the Company certain documents
as a condition to exercise of conversion rights hereunder, all in form and
substance satisfactory to the Company as determined in its sole discretion. In
the event the Company reasonably determines that the Warrant cannot be exercised
in compliance with applicable federal and state securities laws in the absence
of registration or qualification under such statutes, the Company shall be under
no obligation to permit exercise of the Warrant and issue any shares of common
stock pursuant hereto. The Company shall utilize its best efforts to qualify
such shares for sale under the applicable state laws in those jurisdictions in
which the Holder of the Warrant resides at the time of conversion. If,
notwithstanding such efforts to qualify such shares for sale in such state, the
Company is unable to so qualify such shares for sale in such state, the shares
delivered shall be subject to applicable restrictions on their transfer under
the laws of such state or, if no exemption from registration is available, this
Warrant shall not be exercisable.
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed
by its duly authorized officer this ____ day of _________, _____.
Total Film Group, Inc.
By /s/ Gerald Green, President
ATTEST:
/s/ Eli Boyer, Secretary
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ASSIGNMENT FORM
(To be executed by the registered Holder to effect a
Transfer of the Within Warrant)
For Value Received_________________________________hereby sells, assigns, and
transfer unto
______________________________________________________________________________
(Please print or typewrite name and address, including
postal zip code of assignee)
this Warrant and the rights represented thereby to purchase Common Stock in
accordance with the terms and conditions thereof, and does hereby irrevocable
constitute and appoint __________________________ attorney to transfer this
Warrant on the books of the Company with full power of substitution.
Date: ________________ Signed __________________________
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SUBSCRIPTION FORM
(To Be Executed by the Registered Holder to Exercise The Rights
To Purchase Common Stock Evidenced By The Within Warrant)
The undersigned hereby irrevocably subscribes for _____________ shares of the
Common Stock of Total Film Group, Inc., pursuant and in accordance with the
terms and conditions of the Warrant and hereby makes payment of
$______________ therefor, and requests that certificate(s) for such shares be
issued in the name of the undersigned and be delivered to the address stated
below, and if such number of shares shall not be all of the shares
purchasable hereunder, that a new Warrant of like tenor for the balance of
the remaining shares purchasable hereunder be delivered to the undersigned at
the address stated below:
Date: ________________ Signed __________________________
SIGNATURE(S) MUST BE GUARANTEED BY A FIRM WHICH IS A MEMBER OF A REGISTERED
NATIONAL STOCK EXCHANGE, OR BY A BANK (OTHER THAN A SAVINGS BANK), OR A TRUST
COMPANY. THE SIGNATURE TO THIS SUBSCRIPTION FORM MUST CORRESPOND WITH THE NAME
AS WRITTEN UPON THE FACE OF THE WARRANT. IN EVERY PARTICULAR, WITHOUT ALTERATION
OR ENLARGEMENT, OR ANY CHANGE WHATSOEVER.
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SCHEDULE OF B-WARRANTS FOR CAPITAL RESEARCH, LTD.
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<CAPTION>
Warrant Number of Expiration Warrant Issue
Number Warrants Date Price Date
<S> <C> <C> <C> <C>
B-1 60,000 September 21, 2004 $2.25 September 21, 1999
B-2 40,000 October 1, 2004 $2.25 October 1, 1999
B-3 100,000 September 10, 2004 $2.50 September 10, 1999
B-4 25,000 December 1, 2004 $2.94 December 1, 1999
B-5 25,000 March 1, 2005 $5.54 March 1, 2000
B-6 25,000 June 1, 2005 $4.75 June 1, 2000
B-7 25,000 September 1, 2005 $4.00 September 1, 2000
B-8 25,000 December 1, 2005 $1.05 December 1, 2000
B-9 100,000 August 14, 2005 $3.50 August 14, 2000
B-10 50,000 November 14, 2005 $3.00 November 14, 2000
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