Exhibit 10.61
 
THIS WARRANT AND ANY SECURITIES ACQUIRED UPON THE EXERCISE OF THIS WARRANT HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), OR ANY STATE SECURITIES LAWS AND NEITHER THE SECURITIES NOR
ANY INTEREST THEREIN MAY BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE
DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH
ACT OR SUCH LAWS OR AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND SUCH LAWS
THAT, IN THE OPINION OF COUNSEL FOR THE HOLDER, WHICH COUNSEL AND OPINION ARE
REASONABLY SATISFACTORY TO COUNSEL FOR THIS CORPORATION, IS AVAILABLE.

 
Warrant to Purchase
   
Date: ____________
28,125
     
Shares of Common Stock,
 
as herein described
   
No. 315
 

OurPet’s
Company

___________________________

Common Stock Purchase Warrant
___________________________

Article 1.     General Provisions.
 
Section 1.01           This certifies that, for good and valuable consideration,
OurPet’s Company, a corporation organized under the laws of Colorado (the
“Company”), grants to  Steven and Evangelia Tsengas (the “Warrantholder”), the
right to purchase from the Company 28,125 validly issued, fully paid and
nonassessable shares (the “Warrant Shares”) of the Company’s Common Stock,
without par value, on or after the date that funds are issued to the Company
pursuant to the Regional 166 Loan (the “166 Loan”) approved by the Controlling
Board of the State of Ohio (the “Effective Date”) and on or before June 28, 2015
(the “Expiration Date”), at the exercise price of $0.807 (U.S. dollars) per
share (the “Exercise Price”), all subject to the terms, conditions and
adjustments herein set forth.
 
 
 

--------------------------------------------------------------------------------

 
 
Exhibit 10.61
 
Article 2.     Duration, Vesting and Exercise of Warrants.
 
Section 2.01           Duration; Vesting of Warrants.  The vested portion of
this Warrant may be exercised, in whole or in part, at any time on or after the
Effective Date and prior to the close of business on the Expiration
Date.  Subject to adjustment from time to time as provided in Section 4 below,
this Warrant shall vest and become exercisable over a period of thirty-six (36)
months beginning on the Effective Date, in which 1/36th of the Warrant Shares
granted to the Warrantholder shall vest each calendar month thereafter. At the
end of the thirty-sixth (36th) month all of the Warrant Shares granted herein
shall be fully vested and exercisable.  In the event that, prior to the Warrant
Shares becoming fully vested and exercisable, the Company’s lender terminates
the guaranty provided by Warrantholder which secures the Company’s 166 Loan with
such lender, then the vesting schedule set forth above shall terminate and no
further Warrant Shares shall vest and become exercisable.  In the event that the
166 Loan terminates without funding, then this Warrant shall be cancelled
without further action required by the Company.
 
Section 2.02            Exercise of Warrant.
 
(a)           This warrant may be exercised, in whole or in part, by
surrendering it, together with a Notice of Exercise, duly executed, accompanied
by a certified or official bank check (or such other form of payment as the
Company may accept) in payment of the Exercise Price.  Warrants may be
surrendered at the Company’s corporate offices indicated in Section 7.10 hereof,
or as such corporate office may be relocated from time to time.
 
(b)           Notwithstanding the foregoing, the Warrantholder may, without the
payment of cash or other consideration (other than the surrender of the right to
purchase certain Warrant Shares implicit in the following formula), exercise
this Warrant for “Net Warrant Shares”. The Warrantholder shall provide written
notice to the Company specifying the gross number of Warrant Shares as to which
this Warrant is then exercised. The number of Net Warrant Shares deliverable
upon such exercise will be determined by the following formula: Net Warrant
Shares = [WS x (CP - EP)]/CP, where “WS” is the gross number of Warrant Shares
as to which this Warrant is to be exercised; “CP” is the average price of the
Common Stock  (as currently traded on the NASDAQ over-the-counter bulletin board
or “OTCBB”) on the ten (10) trading days preceding the date of the request to
exercise this Warrant; and “EP” shall mean the then applicable Exercise Price.
 
(c)           This Warrant shall be exercisable during the period provided in
Section 2.01 at any time or in whole or from time to time in part.  As soon as
practicable after the Warrant has been so exercised, the Company shall issue and
deliver or cause to be delivered to, or upon the order of, the holder of the
Warrant, in such name or names as may be directed by such holder, a certificate
or certificates for the number of full Warrant Shares to which such holder is
entitled and, if this Warrant shall not have been exercised in full, a new
Warrant for the number of shares of Common Stock as to which this Warrant shall
not have been exercised, subject to the surrender of the right to purchase
certain Warrant Shares implicit in the exercise of this Warrant under Section
2.02(b).  This warrant, when so surrendered, shall be cancelled by or on behalf
of the Company.
 
 
 

--------------------------------------------------------------------------------

 
 
Exhibit 10.61
 
Section 2.03            Common Stock Issued Upon Exercise of Warrant.
 
(a)           All Warrant Shares shall be duly authorized, validly issued, fully
paid and nonassessable.  The Company shall pay all documentary stamp taxes
attributable to the initial issuance of Warrant Shares.  The Company shall not
be required, however, to pay any tax imposed in connection with any transfer
involved in the issue of the Warrant Shares in a name other than that of that
holder of this Warrant upon exercise.  In such case, the Company shall not be
required to issue any certificate for Warrant Shares until the person or persons
requesting the same shall have paid to the Company the amount of any such tax or
shall have established to the Company’s satisfaction that the tax has been paid
or that no tax is due.
 
(b)           Irrespective of the date of issue of certificates for any Warrant
Shares acquired upon exercise of this Warrant, each person in whose name any
certificate is issued shall be deemed to have become the holder of record of the
Warrant Shares represented thereby on the date on which this Warrant was
exercised and payment of the Exercise Price was tendered as provided in Section
2.02 with respect to such Warrant Shares.
 
Article 3.      Restrictions on Transfer; Restrictive Legends.
 
Section 3.01            Restrictions on Transfer. This Warrant may not be
offered, sold, transferred, pledged or otherwise disposed of in whole or in
part, to any person; provided that the Warrantholder may offer, sell or transfer
this Warrant to any Affiliate (defined herein) of the Warrantholder, subject to
compliance with any applicable securities laws. “Affiliate” means any person who
is an “affiliate” as defined in Rule 12b-2 of the General Rules and Regulations
under the Securities and Exchange Act of 1934.

Section 3.02            Restrictive Legends. Except as otherwise permitted by
this Article 3, each stock certificate for Warrant Shares issued upon the
exercise of any Warrant and each stock certificate issued upon the direct or
indirect transfer of any such Warrant Shares shall be stamped or otherwise
imprinted with a legend in substantially the following form:

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND NEITHER THE SECURITIES
NOR ANY INTEREST HEREIN MAY BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE
DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH
ACT OR SUCH LAWS OR AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND SUCH LAWS
THAT, IN THE OPINION OF COUNSEL FOR THE HOLDER, WHICH COUNSEL AND OPINION ARE
REASONABLY SATISFACTORY TO COUNSEL FOR THIS CORPORATION, IS AVAILABLE.

Section 3.03           Removal of Legend. Notwithstanding the foregoing, the
Warrantholder may require the Company to issue a Warrant or a stock certificate
for Warrant Shares, in each case without a legend, if either (a) such Warrant or
such Warrant Shares, as the case may be, have been registered for resale under
the Securities Act, (b) the Warrantholder has delivered to the Company an
opinion of legal counsel (from a firm reasonably satisfactory to the Company)
which opinion shall be addressed to the Company and be reasonably satisfactory
in form and substance to the Company’s counsel, to the effect that such
registration is not required with respect to such Warrant or such Warrant
Shares, as the case may be, or (c) such Warrant or Warrant Shares are sold in
compliance with Rule 144 or Rule 144(k) (or any successor provision then in
effect) under the Securities Act, the Company receives customary representations
to such effect and the Company receives an opinion of counsel to the Company in
customary form that such legend may be removed.

 
 

--------------------------------------------------------------------------------

 
 
Exhibit 10.61
 
Article 4.    Anti-Dilution Provisions.
 
Section 4.01            Stock Dividends, Splits, Combinations.  If at any time
after the date of the issuance of this Warrant, the Company (a) declares a
dividend or other distribution payable in Common Stock or subdivides its
outstanding Common Stock into a larger number or (b) combines its outstanding
Common Stock into a smaller number, then (i) the number of Warrant Shares to be
delivered upon exercise of this Warrant will, upon the occurrence of an event
set forth in clause (a) above, be increased and, upon the occurrence of an event
set forth in clause (b) above, be decreased so that such Warrantholder will be
entitled to receive the number of Common Stock that such Warrantholder would
have owned immediately following such action had this Warrant been exercised
immediately prior thereto and (ii) the Exercise Price in effect immediately
prior to such dividend, other distribution, subdivision or combination, as the
case may be, shall be adjusted proportionately by multiplying such Exercise
Price by a fraction, of which the numerator shall be the number of Warrant
Shares purchasable upon exercise of this Warrant immediately prior to such
adjustment and of which the denominator shall be the number of Warrant Shares
purchasable immediately thereafter.

Section 4.02            Distribution of Stock, Other Securities, Evidence of
Indebtedness.  In case the Company shall distribute to the holders of Common
Stock, shares of its capital stock (other than Common Stock for which adjustment
is made under Section 4.01), stock or other securities of the Company or any
other Person, evidences of indebtedness issued by the Company or any other
Person, assets (excluding cash dividends) or options, warrants or rights to
subscribe for or purchase the foregoing, then, and in each such case,
immediately following the record date fixed for the determination of the holders
of Common Stock entitled to receive such distribution, (a) the Exercise Price
then in effect shall be adjusted by multiplying the Exercise Price in effect
immediately prior to such record date by a fraction (i) the numerator of which
shall be such the average price of one share of Common Stock on the OTCBB on the
ten (10) trading days preceding such record date (“Current Market Price”) less
the then fair market value (as determined by the Board of Directors or a duly
appointed committee thereof) of the portion of the stock, other securities,
evidences of indebtedness so distributed or of such options, warrants or rights
applicable to one share of Common Stock (but such numerator shall not be less
than 0.10) and (ii) the denominator of which shall be the Current Market Price
of one share of Common Stock on such record date  and (b) the number of Warrant
Shares shall be adjusted to equal (i) the number of Warrant Shares for which
this Warrant is exercisable immediately prior to such adjustment multiplied by
the Exercise Price then in effect, divided by (ii) the Exercise Price as
adjusted pursuant to clause (a) above. Such adjustment 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.
 
 
 

--------------------------------------------------------------------------------

 
 
Exhibit 10.61
 

Section 4.03           Reorganization, Merger, Sale of Assets.  In case of any
capital reorganization or reclassification or other change of outstanding Common
Stock (other than a change in par value), any consolidation or merger of the
Company with or into another entity (other than a consolidation or merger of the
Company in which the Company is the resulting or surviving entity and which does
not result in any reclassification or change of outstanding Common Stock) or the
sale of all or substantially all of the assets of the Company to an unrelated
third party, upon exercise of this Warrant, the Warrantholder shall have the
right to receive the kind and amount of shares of stock or other securities or
property to which a holder of the number of Common Stock of the Company
deliverable upon exercise of this Warrant would have been entitled upon such
reorganization, reclassification, consolidation, merger or sale had this Warrant
been exercised immediately prior to such event; and, in such case, appropriate
adjustment (as determined in good faith by the Board of Directors or a duly
appointed committee thereof) shall be made in the application of the provisions
of this Article 4 with respect to the rights and interest thereafter of the
Warrantholder, to the end that the provisions set forth in this Article 4
(including provisions with respect to changes in and other adjustments of the
Exercise Price and number of Warrant Shares) shall thereafter be applicable, as
nearly as reasonably may be, in relation to any shares of stock or other
property thereafter deliverable upon exercise of this Warrant.

Section 4.04           Carryover.  Notwithstanding any other provision of this
Article 4, no adjustment shall be made to the number of Common Stock to be
delivered to the Warrantholder (or to the Exercise Price) if such adjustment
represents less than 1% of the number of shares to be so delivered, but any
lesser adjustment shall be carried forward and shall be made at the time and
together with the next subsequent adjustment that together with any adjustments
so carried forward shall amount to 1% or more of the number of shares to be so
delivered; provided however, that, upon exercise of this warrant pursuant to
Article 2, any adjustment called for by Sections 4.01, 4.02 or 4.03 which has
not been made as a result of this Section 4.04 shall be made.

Section 4.05           No Adjustment for Dividends.  Except as provided in
Sections 4.01, 4.02 and 4.03, no adjustment in respect of any dividends shall be
made during the term of this Warrant or upon the exercise of this Warrant.
Notwithstanding any other provision hereof, no adjustments shall be made on
Warrant Shares issuable on the exercise of this Warrant for any cash dividends
paid or payable to holders of record of Common Stock prior to the date as of
which the Warrantholder shall be deemed to be the record holder of such Warrant
Shares.

Section 4.06           Notice of Adjustment.  Whenever the number of Warrant
Shares or the Exercise Price of such Warrant Shares shall be adjusted, as
provided in Section 4.01, the Company shall forthwith file, at the principal
office of the Company (or at such other place as may be designated by the
Company), a statement, certified by the chief financial officer of the Company,
showing in detail the facts requiring such adjustment, the computation by which
such adjustment was made and the Exercise Price that shall be in effect after
such adjustment. The Company shall also cause a copy of such statement to be
sent by first class mail postage prepaid, to the Warrantholder, at such
Warrantholder’s address as shown in the records of the Company.
 
 
 

--------------------------------------------------------------------------------

 
 
Exhibit 10.61
 
Section 4.07            Form of Warrant.  This Warrant need not be changed
because of any adjustment to the Exercise Price or any change in the amount or
nature of securities issuable or deliverable pursuant to this Article 4.  The
Company may, however, in its discretion, at any time change the form of Warrants
to reflect any such change in the amount or nature of securities issuable or
deliverable upon exercise, provided such change in form does not otherwise
affect the substance thereof.
 
Article 5.     Other Provisions for Protection of Warrantholders.
 
Section 5.01            Reservation of Shares.  The Company shall at all times
reserve and keep available such number of shares of its authorized but unissued
Common Stock as shall from time to time be sufficient to permit the exercise of
all outstanding Warrants.  If at any time the number of authorized but unissued
shares of Common Stock shall not be sufficient for such purpose, the Company
will take such action as, in the opinion of its counsel, may be necessary to
increase its authorized but unissued Common Stock to such number of shares as
shall be sufficient for such purpose.
 
Section 5.02            Lost and Misplaced Warrant Certificates.  If any Warrant
becomes lost, stolen, mutilated or destroyed, the Company will, on such terms as
to indemnify or otherwise as it may in its discretion impose, issue a new
Warrant of like denomination, tenor and dates as the Warrant so lost, stolen,
mutilated or destroyed.  Any such new Warrant shall constitute an original
contractual obligation of the Company, whether or not the allegedly lost,
stolen, mutilated or destroyed Warrant shall at any time be enforceable by
anyone.
 
Section 5.03           Enforcement of Warrant Rights.  All rights of action are
vested in the respective holders of the Warrants.  Any holder of any Warrant
may, in his own behalf and for his own benefit, enforce, and may institute and
maintain any suit, action or proceeding against the Company suitable to enforce,
or otherwise in respect of, his right to exercise his Warrant for the purchase
of the number of Warrant Shares issuable or deliverable in exchange therefor.
 
Article 6.      Transfer and Ownership of Warrants.
 
Section 6.01            Negotiability and Ownership.  The Warrants have been,
and, if the Warrants are exercised, the Warrant Shares will be, acquired for the
account of the holder for investment and not with a view to resale or further
distribution thereof.  This Warrant shall be transferable by the holder hereof
only in compliance with applicable securities laws.  Any attempted transfer in
contravention of this Section shall be null and void.  Any such transferee may
be required to execute an investment letter containing representations and
warranties as to his or her investment intent, financial sophistication and
ability to bear the risk of any investment in the Warrants or the Warrant Shares
and to satisfy the Company of the bona fide nature of such representations.
 
Section 6.02            Exchange of Warrants.  At any time after the issuance
and prior to expiration, this Warrant may be surrendered at the corporate
offices of the Company for exchange and, upon cancellation hereof, one or more
new Warrants shall be issued as requested by the holder for the same aggregate
number of shares.
 
 
 

--------------------------------------------------------------------------------

 
 
Exhibit 10.61
 
Article 7.     Miscellaneous Provisions.
 
Section 7.01           Closing of Books.  The Company will at no time close its
transfer books against the transfer of any warrant or of any shares of Common
Stock issued or issuable upon the exercise of any warrant in any manner which
interferes with the timely exercise of this Warrant.
 
Section 7.02            Modification and Waiver.  Any provision of this Warrant
may be amended and the observance thereof waived only with the written consent
of the Company and the Warrantholder.
 
Section 7.03            Ownership of Warrant.  The Company may deem and treat
the person in whose name this Warrant is registered as the holder and owner
hereof (notwithstanding notations of ownership or writing hereon made by anyone
other than the Company) for all purposes and shall not be affected by any notice
to the contrary, until presentation of this Warrant for registration of
transfer.
 
Section 7.04            Entire Agreement.  This Warrant constitutes the entire
agreement between the Company and the Warrantholder with respect to this
Warrant.
 
Section 7.05           Binding Effect; Benefit.  This Warrant shall inure to the
benefit of and shall be binding upon the Company and the Warrantholder and their
respective successors and assigns. Nothing in this Warrant, expressed or
implied, is intended to or shall confer on any person other than the Company and
the Warrantholder, or their respective successors or assigns, any rights,
remedies, obligations or liabilities or by reason of this Warrant.
 
Section 7.06            Severability.  Any term or provision of this Warrant
which is invalid or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the terms and
provisions of this Warrant or affecting the validity or enforceability of any of
the terms or provisions of this Warrant in any other jurisdiction.
 
Section 7.07           No Rights or Liabilities as Stockholder.  Nothing
contained in this Warrant shall be determined as conferring upon the
Warrantholder any rights as a stockholder of the Company or as imposing any
liabilities on the Warrantholder to purchase any securities whether such
liabilities are asserted by the Company or by creditors or stockholders of the
Company or otherwise.
 
Section 7.08           No Impairment.  The Company will not, by amendment of its
articles or through reorganization, consolidation, merger, dissolution, sale of
assets or any other voluntary action, avoid or seek to avoid the observance or
performance of any of the terms of this Warrant, but will at all times in good
faith assist in the carrying out of all such terms and in the taking of all such
action as may be necessary or appropriate in order to protect the rights of the
holder of this Warrant against impairment.
 
Section 7.09            Descriptive Headings.  The description headings of the
several articles, sections and paragraphs of this Warrant are inserted for
convenience only and shall not be deemed a part of this Warrant or to affect the
meaning or interpretation of this Warrant.
 
 
 

--------------------------------------------------------------------------------

 
 
Exhibit 10.61
 
Section 7.10            Governing Law.  This Warrant shall be construed and
enforced in accordance with, and the rights of the parties shall be governed by,
the laws of the State of Ohio, without regard to conflict of laws principles.
 
Section 7.11            Notices.  Any notice given pursuant to this Agreement to
be given to the Company shall be sufficiently given if sent by first-class mail,
postage prepaid, addressed (until Holder of record is advised in writing of any
other address) as follows:
 
OurPet’s Company
1300 East Street
Fairport Harbor, Ohio 44077

IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its duly
authorized officer as of the date set forth on the cover.
 

 
OURPET’S COMPANY
           
By:
  
   
Its:
  
 

 
 
 

--------------------------------------------------------------------------------

 
 
Exhibit 10.61
 
ASSIGNMENT
 
To be executed by the registered Warrantholder to effect a transfer of the
within Warrant, subject to the restrictions imposed by Section 3.01 of the
Warrant.
 
FOR VALUE RECEIVED, the undersigned registered holder hereby sells, assigns and
transfers unto
 

 
  
 
(name)
 
  
     
  
 
(address)

the right to purchase the Common Stock evidenced by the within Warrant, and does
irrevocably constitute and appoint ________________________ to transfer the said
right on the books of the Company, with full power of substitution.
 
Dated:                                         
 
SIGNATURE                                                                                    

 
NOTICE:  The signature to this Assignment must correspond with the name as
written upon the face of the within Warrant, in every particular, without
alteration or change whatsoever, and must be guaranteed by a bank or trust
company, or be a firm having membership on a registered national securities
exchange.
 
 
 

--------------------------------------------------------------------------------

 
 
Exhibit 10.61
 
EXERCISE OF WARRANT
 
The undersigned, _____________________________________, pursuant to the
provisions of the within Warrant, hereby elects to purchase ______________
shares of Common Stock of OurPet’s Company, covered by the within Warrant, and
tenders herewith payment of the Exercise Price in full in the form of certified
or bank cashier's check or wire transfer.

Please issue a certificate or certificates for such Common Stock in the
following name or names and denominations:

If said number of shares are not all the shares of Common Stock issuable upon
exercise of the attached Warrant, a new Warrant is to be issued in the name of
the undersigned for the balance remaining of such shares less any faction of a
share paid in cash.

 
  
 
(Signature)
 
 
     
 
 
(Address)
Dated:                                        
 

NOTICE:  The signature to this Exercise of Warrant must correspond with the name
as written upon the face of the within Warrant, in every particular, without
alteration or change whatsoever.
 
[This form shall be modified by the Warrantholder and the Company as appropriate
in the event Warrantholder exercises the Warrant, in whole or in part, in
accordance with Section 2.02(b) of the Warrant.]
 
 
 

--------------------------------------------------------------------------------