exhibit 10.4
 
Amended and Restated Warrant
 
THIS INSTRUMENT IS SUBJECT TO THE TERMS OF A SUBORDINATION AGREEMENT DATED AS OF
DECEMBER 30, 2011, AS IT MAY BE AMENDED, RESTATED OR MODIFIED FROM TIME TO TIME,
BY NEWSPRING SBIC MEZZANINE CAPITAL II, L.P., FOR ITSELF AND IN ITS CAPACITY AS
COLLATERAL AGENT FOR THE INVESTORS, PEACHTREE II, L.P., AND PNC BANK, NATIONAL
ASSOCIATION, AS AGENT FOR THE LENDERS (AS DEFINED THEREIN), (AND THEIR
RESPECTIVE SUCCESSORS AND ASSIGNS), EMTEC, INC. AND EACH OTHER OBLIGOR A PARTY
THERETO FROM TIME TO TIME, AND EACH HOLDER HEREOF BY ITS ACCEPTANCE HEREOF SHALL
BE BOUND BY THE PROVISIONS OF SUCH SUBORDINATION AGREEMENT.
 
THIS WARRANT AND THE SHARES THAT MAY BE PURCHASED HEREUNDER HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 OR UNDER THE SECURITIES LAWS OF ANY
STATE.  THIS WARRANT AND THE SHARES THAT MAY BE PURCHASED HEREUNDER MAY NOT BE
SOLD OR OFFERED FOR SALE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933, AND REGISTRATION OR QUALIFICATION UNDER
APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL THAT THE PROPOSED
TRANSACTION DOES NOT VIOLATE THE SECURITIES ACT OF 1933, AND APPLICABLE STATE
SECURITIES LAWS.
 
Date of Issuance: August 15, 2011
 
EMTEC, INC.
 
Common Stock Purchase Warrant
 
Emtec, Inc., a Delaware corporation (the “Company”), for value received, hereby
certifies and agrees that NewSpring SBIC Mezzanine Capital II, L.P., a Delaware
limited partnership, or its assigns (the “Registered Holder”), is entitled,
subject to the terms set forth below, to purchase from the Company, at any time
or from time to time on or before the tenth anniversary of the Date of Issuance
at not later than 5:00 p.m. (such date and time, the “Expiration Time”), the
number of shares of common stock of the Company, par value $0.01 per share (the
“Common Stock”), as equals 5% of the Common Stock outstanding at the time of,
and after giving effect to, the exercise of this Warrant (based on the “treasury
stock method” in accordance with the generally accepted accounting principles
applicable in the United States of America and determined using the same
principles, assumptions and estimates that are used by the Company in the
preparation of its financial statements and assuming the exercise or conversion
of all securities that are directly or indirectly exercisable for or convertible
into Common Stock), at a purchase price of $0.01 per share.  The shares of
Common Stock purchasable upon exercise of this Warrant, and the purchase price
therefor, are hereinafter referred to as the “Shares” and the “Exercise Price,”
respectively.  This Warrant is issued pursuant to the terms of that certain
Subordinated Loan Agreement dated as of August 15, 2011, and amended and
restated as of December 30, 2011 among the Company, each of the other entities
set forth on Appendix I thereto, signatories thereto and NewSpring SBIC
Mezzanine Capital II, L.P. and Peachtree II, L.P. (as it may be amended,
restated or modified from time to time, the “Loan Agreement”).  The term
“Warrant” as used herein shall include this Warrant and any other warrants
delivered in substitution or exchange herefor, as provided herein.  In the event
that the Warrant is not exercised prior to the Expiration Time, the Warrant
shall be deemed exercised (even if this Warrant is not surrendered) pursuant to
a Cashless Exercise (as defined in Section 1(a)(2) hereof) immediately prior to
the Expiration Time.  Any term used in this Warrant and not defined shall have
the meaning given to such term in the Loan Agreement.
 
 
 

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1.      Exercise.
 
(a)           This Warrant may be exercised by the Registered Holder, in whole
or in part, as follows:
 
(1)           by surrendering this Warrant, with a Notice of Exercise in the
form of Annex A hereto (the “Notice of Exercise”) duly executed by such
Registered Holder or by such Registered Holder’s duly authorized attorney, at
the principal office of the Company, or at such other office or agency as the
Company may designate in writing (the “Company’s Office”), accompanied by
payment in full, in lawful money of the United States, of the Exercise Price
payable in respect of the number of Shares purchased upon such exercise; or
 
(2)           by surrendering this Warrant, with a Notice of Cashless Exercise
in the form of Annex B attached hereto (a “Cashless Exercise”) duly executed by
such Registered Holder or by such Registered Holder’s duly authorized attorney,
at the Company’s Office.  Such presentation and surrender shall be deemed a
waiver of the Registered Holder’s obligation to pay the Exercise Price for the
Shares.  In the event of a Cashless Exercise, the Registered Holder shall
exchange this Warrant for that number of Shares equal to the number of Shares
specified in such Notice of Cashless Exercise multiplied by a fraction, the
numerator of which shall be the difference between the then current market value
per share of Common Stock and the Exercise Price per Share, and the denominator
of which shall be the then current market value per share of Common Stock.  For
purposes of any computation under this Warrant, the then current market value
per share of Common Stock at any date (the “Market Value”) shall be deemed to be
either (A) in the event the shares of Common Stock are not admitted to trading
or listed on any national securities exchange, the highest price per share of
Common Stock that the Company could reasonably obtain from a willing buyer (who
is not a current employee, director, manager or Affiliate of the Company) for
shares of Common Stock sold by the Company, from authorized but unissued shares
of Common Stock, as determined in good faith by the Board of Directors of the
Company or (B) in the event the shares of Common Stock are admitted to trading
or listed on a national securities exchange or sold “over the counter,” the last
sale price of the shares of Common Stock on the business day prior to the date
of the Cashless Exercise or, in case no such reported sales take place on such
day, the average of the last reported bid and asked prices of such shares of
Common Stock on such day, in either case on the principal national securities
exchange or “over the counter” market on which such stock is admitted to trading
or listed.
 
 
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(b)           So long as this Warrant shall be outstanding, if the Company
proposes to enter into a Mandatory Exercise Transaction (as defined below), then
in any such case, the Company shall cause to be mailed by certified mail or
overnight carrier to the Investor, at least 20 days prior to the date such
proposed Mandatory Exercise Transaction is to be effectuated, a notice
containing (i) a brief description of the proposed Mandatory Exercise
Transaction; and (ii) the date upon which such proposed Mandatory Exercise
Transaction is to take place.  The failure to give such notice, however, shall
not affect the validity of any proposed Mandatory Exercise Transaction for which
the notice was required to be given but shall relieve the Investor of its
obligation to exercise its Warrants pursuant to this provision.  During the
period beginning on the date of the Investor’s receipt of such notice and ending
on the date that is three days prior to the date upon which such proposed
Mandatory Exercise Transaction is to take place, as set forth in the notice (the
“Mandatory Exercise Period”), the Investor must exercise its right, in
accordance with all applicable conditions of exercise set forth in this Warrant,
to purchase all of the shares of Common Stock that the Investor is entitled to
purchase hereunder; provided, however, that Investor may condition its exercise
upon, set the effective time of such exercise as immediately prior to, the
occurrence or consummation of the proposed Mandatory Exercise Transaction.  If
the Investor fails to so exercise such right within the Mandatory Exercise
Period then, upon the occurrence or consummation of the proposed Mandatory
Exercise Transaction, this Warrant shall be deemed to have been automatically
exercised under Section 1(a)(2) above immediately prior to the occurrence or
consummation of the proposed Mandatory Exercise Transaction.  For purposes
hereof, a “Mandatory Exercise Transaction” shall mean any of the following:
 
(1)           the acquisition by any Person (or group of Persons acting in
concert), other than the stockholders of the Company as of the date hereof, of
beneficial ownership of 50% or more of the voting securities of the Company;
 
(2)           the consummation by the Company of a reorganization, merger or
consolidation, or exchange of shares, if immediately after giving effect to such
transaction, the stockholders who beneficially own or control at least 50% of
the voting securities of the Company immediately prior to such transaction
beneficially own in the aggregate less than 50% of such voting securities
immediately following such transaction;
 
(3)           the consummation by the Company of the sale or other disposition
of all or substantially all of its assets to any entity or person that is not
controlled by or under common control with the Company;
 
(4)           the consummation by the Company of a plan of complete liquidation
or dissolution of the Company; or
 
(5)           the announcement of the Company’s intention to consummate any of
the actions in (1)-(4) above.
 
(c)           Each exercise of this Warrant shall be deemed to have been
effected immediately prior to the close of business on the day on which this
Warrant shall have been surrendered to the Company as provided in Section 1(a)
hereof.  At such time, the person or persons in whose name or names any Shares
shall be registered upon such exercise as provided in Section 1(d) hereof shall
be deemed to have become the holder or holders of record of the Shares
represented by such certificates.
 
 
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(d)           As soon as practicable after the exercise of this Warrant in full
or in part, and in any event within ten days thereafter, the Company, at its
expense, will cause to be issued in the name of, and delivered to, the
Registered Holder, or as such Registered Holder (upon payment by such Registered
Holder of any applicable transfer taxes) may direct:
 
(1)           evidence of the number of full Shares to which such Registered
Holder shall be entitled upon such exercise plus, in lieu of any fractional unit
to which such Registered Holder would otherwise be entitled, cash in an amount
determined pursuant to Section 4 hereof; and
 
(2)           in case such exercise is in part only, a new warrant or warrants
(dated the date hereof) of like tenor, representing in the aggregate on the face
or faces thereof the number of Shares equal (without giving effect to any
adjustment therein) to the Shares called for on the face of this Warrant minus
the Shares purchased by the Registered Holder upon such exercise as provided in
Section 1(a) hereof.
 
(e)           Notwithstanding anything to the contrary contained in the first
paragraph of this Warrant, Section 1(a) hereof or this Section 1(e), the
Registered Holder shall have the right to exercise this Warrant, in whole or in
part, by the payment of the Exercise Price payable in respect of the number of
Shares purchased upon such exercise through the satisfaction of all or a portion
of the then-outstanding indebtedness of the Company by the Registered Holder
evidenced by the Senior Subordinated Promissory Note, dated of even date
herewith (the “Note”), issued by the Company pursuant to the Loan Agreement by
surrender of this Warrant at the Company’s Office, together with such Note and
the duly executed Notice of Exercise.
 
2.           Effect of Certain Events.
 
(a)           Reorganizations, Consolidations, etc.  In the event, at any time
after the date hereof, of any capital reorganization, or any reclassification of
the equity interests of the Company, or the consolidation or merger of the
Company with or into another person (other than consolidation or merger in which
the Company is the continuing entity and which does not result in any change in
the powers, designations, preferences and rights, or the qualifications,
limitations or restrictions, if any, of the equity interests of the Company as
amended from time to time) or of the sale or other disposition of all or
substantially all the properties and assets of the Company in its entirety to
any other person (other than a Mandatory Exercise Transaction) (any such
transaction, an “Extraordinary Transaction”), then this Warrant shall be
exercisable for the kind and number of equity interests or other securities,
cash,  or property of the Company, or of the corporation resulting from or
surviving such Extraordinary Transaction, that a holder of the number of shares
of Common Stock deliverable (immediately prior to the effectiveness of the
Extraordinary Transaction) upon exercise of this Warrant would have been
entitled to receive upon such Extraordinary Transaction.  The provisions of this
Section 2(b) shall similarly apply to successive Extraordinary Transactions.
 
 
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(b)           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, prior to such dissolution, shall at its expense deliver or cause to
be delivered the shares of Common Stock or other securities and property
(including cash, where applicable) receivable by the Registered Holder after the
effective date of such dissolution pursuant to this Warrant to the Registered
Holder.
 
(c)           Calculations.  All calculations under this Section 2 shall be made
to the nearest share.
 
3.           Shares to be Fully Paid; Reservation of Common Stock.  The Company
covenants and agrees that all Shares which may be issued upon the exercise of
the rights represented by this Warrant will, upon issuance, be fully paid and
nonassessable and free from all taxes, liens and charges with respect to the
issue thereof.  The Company further covenants and agrees that 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 the subscription rights evidenced by this Warrant,
a sufficient number of shares of its Common Stock to provide for the exercise of
the rights represented by this Warrant.  The Company represents that this
Warrant and the Shares issuable upon exercise thereof are and will be issued
free and clear of preemptive rights, rights of first refusal or similar rights
entitling others to purchase such securities.
 
4.           Fractional Shares.  The Company shall not be required upon the
exercise of this Warrant to issue any fractional shares, but shall make an
adjustment thereof in cash on the basis of the Market Value for each fractional
share of the Common Stock which would be issuable upon exercise of this Warrant.
 
5.           Requirements for Transfer.
 
(a)           Warrant Register.  The Company will maintain a register (the
“Warrant Register”) containing the names and addresses of the Registered Holder
or Registered Holders.  Any Registered Holder of this Warrant or any portion
hereof may change its address as shown on the Warrant Register by written notice
to the Company requesting such change, and the Company shall promptly make such
change.  Until this Warrant is transferred on the Warrant Register of the
Company, the Company may treat the Registered Holder as shown on the Warrant
Register as the absolute owner of this Warrant for all purposes, notwithstanding
any notice to the contrary, provided, however, that if and when this Warrant is
properly assigned in blank, the Company may, but shall not be obligated to,
treat the bearer hereof as the absolute owner hereof for all purposes,
notwithstanding any notice to the contrary.
 
(b)           Transfer.  Subject to the provisions of this Section 5, this
Warrant and all rights hereunder are transferable, in whole or in part, upon the
surrender of this Warrant with a properly executed Assignment Form in
substantially the form attached hereto as Annex C (the “Assignment”) at the
principal office of the Company to any Affiliate (as defined in Rule 12b-2
promulgated under the Securities Exchange Act of 1934, as amended) or to any
individual or entity acquiring all or substantially all of the assets of the
Registered Holder or to any successor of the Registered Holder by merger or
consolidation.
 
 
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(c)           Exchange of Warrant Upon a Transfer.  On surrender of this Warrant
for exchange, properly endorsed on the Assignment and subject to the provisions
of this Warrant and with the limitations on assignments and transfers as
contained in this Section 5, the Company at its expense shall issue to or on the
order of the Registered Holder a new warrant or warrants of like tenor, in the
name of the Registered Holder or as the Registered Holder (on payment by the
Registered Holder of any applicable transfer taxes) may direct, for the number
of Shares issuable upon exercise hereof.
 
6.           No Impairment.  The Company will not, by amendment of its Articles
of Incorporation or through reorganization, consolidation, merger, liquidation,
dissolution, sale of assets, issuance of additional debt, issuance of senior or
pari passu securities, repurchase or redemption of securities 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 carry out all such terms and
take all such action as may be reasonably necessary or appropriate in order to
protect the rights of the Registered Holder against impairment.
 
7.           Dividends or Distributions.  If the Company pays a dividend or
makes a distribution on shares of Common Stock, while the Warrant is
outstanding, then the Company will pay or distribute to the Registered Holder of
the Warrant, upon the exercise thereof, in addition to the number of Shares
purchased upon such exercise, the dividend or distribution that would have been
paid to such Registered Holder if it had been the owner of record of such Shares
immediately prior to the date on which a record is taken for such dividend or
distribution or, if no record is taken, the date as of which the record holders
of Common Stock of the Company entitled to such dividends or distribution are to
be determined.
 
8.           Notices of Record Date, Etc.  In case:
 
(a)           the Company shall take a record of the holders of its shares of
Common Stock (or other securities at the time deliverable upon the exercise of
this Warrant) for the purpose of entitling or enabling them to receive any
dividend or other distribution, or to receive any right to subscribe for or
purchase any securities, or to receive any other right; or
 
(b)           of any capital reorganization of the Company, any reclassification
of the shares of Common Stock of the Company, any consolidation or merger of the
Company with or into another corporation (other than a consolidation or merger
in which the Company is the surviving entity), or any transfer of all or
substantially all of the assets of the Company; or
 
(c)           of the voluntary or involuntary dissolution, liquidation or
winding-up of the Company,
 
then, and in each such case, the Company will deliver the Registered Holder of
this Warrant a notice specifying, as the case may be, (i) the date on which a
record is to be taken for the purpose of such dividend, distribution or right,
and stating the amount and character of such dividend, distribution or right, or
(ii) the effective date on which such reorganization, reclassification,
consolidation, merger, transfer, dissolution, liquidation or winding-up is to
take place, and the time, if any is to be fixed, as of which the holders of
record of shares of Common Stock (or such other securities at the time
deliverable upon the exercise of this Warrant) shall be entitled to exchange
their shares of Common Stock (or such other securities) for securities or other
property deliverable upon such reorganization, reclassification, consolidation,
merger, transfer, dissolution, liquidation or winding-up.  Such notice shall be
mailed at least 10 days prior to the record date or effective date for the event
specified in such notice unless such prior notice is waived by the Registered
Holder.
 
 
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9.           Repurchase of Warrant.
 
(a)           At Registered Holder’s Option.  At any time and from time to time
after the earlier to occur of (i) a Mandatory Prepayment Event (as defined in
the Loan Agreement), (ii) the date that is five years from the date of issuance
of this Warrant or (iii) any prepayment made by the Company pursuant to Section
2.6 of the Loan Agreement that results in an aggregate of 50% or less of the
original amount of the Subordinated Loan (as defined in the Loan Agreement) to
be outstanding, upon the election of the Registered Holder, the Company (or its
successor-in-interest under the Loan Agreement) shall purchase for cash the
Warrant from the Registered Holder for the Repurchase Price.
 
(b)           Mechanics of Repurchase.  To exercise the rights set forth in this
Section 9, the Registered Holder shall deliver to the Company a written notice
(a “Repurchase Notice”) indicating the number of Shares to be included in such
repurchase.  The closing of such repurchase shall take place on the earlier of
the (i) closing of a Change of Control or (ii) the 180th day following the date
of the Repurchase Notice (the “Repurchase Closing Date”).  On any such
Repurchase Closing Date, (i) the Company shall pay the Repurchase Price for the
Shares being repurchased (less the Exercise Price to be paid for such Shares),
(ii) the Registered Holder shall surrender this Warrant to the Company, (iii)
the surrendered Warrant shall be cancelled, and (iv) a new Warrant shall be
issued to the Registered Holder representing all remaining Shares that were not
so purchased; provided, however, that if the Company consummates a Change of
Control on or before the Repurchase Closing Date (or if, on or before the
Repurchase Closing Date, the Company has executed a definitive agreement
contemplating a Change of Control that is scheduled to close within 60 days
following the Repurchase Closing Date) in which the aggregate amount payable at
closing to the holders of the Common Stock (including amounts payable to the
holders of the Company’s preferred stock on an as-converted to Common Stock
basis after payment of any liquidation preferences) (the “Transaction Value”) is
less than the Repurchase Value, then the Company shall only be obligated to pay
to the Registered Holder the Transaction Price for the Shares being repurchased
(less the Exercise Price to be paid for such Shares).  If, for any reason, the
Company fails to repurchase and pay in full the Repurchase Price for the Shares
to be so repurchased in accordance with the Repurchase Notice, the Company shall
issue to the Registered Holder a note for the amount of the Repurchase Price,
which note shall bear interest on the unpaid principal amount at a rate equal to
the lesser of 15% per annum, or the maximum rate permitted under applicable law,
retroactive to the Repurchase Closing Date, until paid in full.  This Section 9
shall survive the exercise of this Warrant until the Registered Holder no longer
holds any shares of Common Stock issuable upon the exercise hereof.
 
(c)           Defined Terms.  For purposes of this Section 9, the following
terms shall have the meanings given to them below:
 
 
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(1)      “Repurchase Price” means an amount equal to (A) a fraction, the
numerator of which is the number of Shares to be repurchased pursuant to the
Repurchase Notice and the denominator of which is the total number of then
outstanding shares of Common Stock of the Company (assuming the conversion or
exercise of all then outstanding securities convertible into, or exercisable
for, shares of Common Stock, including this Warrant), multiplied by (B) the
Repurchase Value.
 
(2)      “Repurchase Value” means the greatest of the following:
 
(a)           an amount equal to the product of (i) six multiplied by (ii) the
Company’s Pro Forma Adjusted EBITDA (as defined in the Loan Agreement) for the
12-month period ended immediately prior to the date of the Repurchase Notice
(based upon income statements reviewed by the Company’s independent certified
public accountant for such period);
 
(b)           an amount equal to the Market Value of the total number of then
outstanding shares of Common Stock of the Company (assuming the conversion or
exercise of all then outstanding securities convertible into, or exercisable
for, shares of Common Stock, including this Warrant) as determined by a
recognized valuation firm mutually selected by the Company and the Registered
Holder; or
 
(c)           an amount equal to the product of (i) six multiplied by (ii) the
annual average of the Company’s Pro Forma Adjusted EBITDA for the 36-month
period ended immediately prior to the date of the Repurchase Notice (based upon
each of the quarterly income statements reviewed by the Company’s independent
certified public accountant for such period).
 
(3)      “Transaction Price” means an amount equal to (A) a fraction, the
numerator of which is the number of Shares to be repurchased pursuant to the
Repurchase Notice and the denominator of which is the total number of then
outstanding shares of Common Stock of the Company (assuming the conversion or
exercise of all then outstanding securities convertible into, or exercisable
for, shares of Common Stock of the Company), multiplied by (B) the Transaction
Value.
 
(d)           Expenses for Market Value Appraisal.  Any expenses for the
determination of Market Value as contemplated by this Section 9 shall be borne
by the Company.  The Registered Holder shall have reasonable access to such
valuation firm during the course of its appraisal of the Company.
 
10.           Replacement of Warrant.  Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and (in the case of loss, theft or destruction) upon delivery of an
indemnity agreement reasonably satisfactory to the Company, or (in the case of
mutilation) upon surrender and cancellation of this Warrant, the Company will
issue, in lieu thereof, a new Warrant of like tenor.
 
 
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11.           Mailing of Notices, etc.  All notices and other communications
from the Company to the Registered Holder of this Warrant shall be mailed by
overnight courier, first-class certified or registered mail, postage prepaid, to
the address furnished to the Company in writing by the last Registered Holder of
this Warrant who shall have furnished an address to the Company in writing,
provided that the notices required pursuant to Section 8 may be given via
facsimile or electronic mail at the facsimile number or email address furnished
to the Company in writing by the last Registered Holder of this Warrant who
shall have furnished such information to the Company in writing.  All notices
and other communications from the Registered Holder of this Warrant or in
connection herewith to the Company shall be mailed by overnight courier,
first-class certified or registered mail, postage prepaid, to the Company at its
principal office set forth below.  If the Company should at any time change the
location of its principal office to a place other than as set forth below, then
it shall give prompt written notice to the Registered Holder of this Warrant and
thereafter all references in this Warrant to the location of its principal
office at the particular time shall be as so specified in such notice.
 
12.           Change or Waiver.  Any term of this Warrant may be changed or
waived only by an instrument in writing signed by each of the Company and the
Registered Holder; provided, however, that any of the provisions of Sections 9
of this Warrant may be waived by an instrument in writing signed only by the
Registered Holder.
 
13.           Certain Rights as a Stockholder; No Liabilities as a
Stockholder.  This Warrant shall not entitle the Registered Holder to any voting
rights or other rights as a stockholder of the Company.  Notwithstanding the
foregoing, the Company shall deliver to the Registered Holders copies of all
communications and other information it provides to stockholders of the Company
at the same time the same is provided to stockholders of the Company.  No
provision of this Warrant, in the absence of affirmative action by the
Registered Holder to purchase the shares of Common Stock, and no mere
enumeration herein of the rights or privileges of the Registered Holder shall
give rise to any liability of the Registered Holder as a stockholder of the
Company, whether such liability is asserted by the Company or by creditors of
the Company.
 
14.           Headings.  The headings in this Warrant are for purposes of
reference only and shall not limit or otherwise affect the meaning of any
provision of this Warrant.
 
15.           Governing Law.  This Warrant and all questions relating to its
validity, interpretation and performance shall be governed by and construed in
accordance with the laws of the Commonwealth of Pennsylvania, without regard to
conflicts of laws principles.
 
16.           Severability.  The invalidity or unenforceability of any provision
hereof shall in no way affect the validity or enforceability of any other
provision.
 
[signature page follows]
 
 
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Emtec, Inc. has caused this Warrant to be signed by its duly authorized officer
and to be dated on the day and year first written above.
 

 
EMTEC, INC.
 
           
By:
/s/ Samir Bhatt       Name: Samir Bhatt       Title:   Secretary  

 
 
 
 
[Signature Page to Common Stock Purchase Warrant]
 
 

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Annex A
 
NOTICE OF EXERCISE FORM
 
To:
____________________________                                                                                                                                          Dated:
______________________
 
The undersigned, pursuant to the provisions set forth in the attached Warrant,
hereby irrevocably elects to purchase the number of Shares covered by such
Warrant and:
 
(a)           herewith makes payment of $ , representing the full purchase price
for a total of _______  Shares at the exercise price per share provided for in
such Warrant; or
 
(b)           herewith attaches the Note (as defined in the Loan Agreement), of
even date herewith, with an outstanding principal balance (plus any unpaid
interest) of $  and, in accordance with Section 1(e) of such Warrant, agrees to
the satisfaction of all or $  of such amount as payment of the full purchase
price for a total of _____ Shares at the exercise price per share provided for
in such Warrant.
 
 

 
Signature:                                                                        
 
Address:   
                                                                      
 
                                                                                           
 
Taxpayer Identification Number: ______________

 
 
 
 
[Annex A to Common Stock Purchase Warrant]
 
 

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Annex B
 
NOTICE OF CASHLESS EXERCISE FORM
 
To:
____________________________                                                                                                                                          Dated:
______________________
 
The undersigned, pursuant to the provisions set forth in the attached Warrant,
hereby irrevocably elects to exchange the Warrant for a total of _________
Shares  pursuant to the Cashless Exercise provisions of the Warrant, in
accordance with Section 1(a)(2) of such Warrant.
 
 

 
Signature:                                                                        
 
Address:   
                                                                      
 
                                                                                           
 
Taxpayer Identification Number: ______________

 
 
 
 
[Annex B to Common Stock Purchase Warrant]
 
 

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Annex C
 
ASSIGNMENT FORM
 
FOR VALUE RECEIVED, ________________________________________________________
hereby sells, assigns and transfers all of the rights of the undersigned under
the attached Warrant with respect to the Shares covered thereby set forth below,
unto:
 
Name of Assignee
Address
No. of Shares
Taxpayer Identification Number
                       

 

Dated:               
Signature:                                                                        
Dated:               
Witness:                                                                          

 
 
 
[Annex C to Common Stock Purchase Warrant]