Exhibit 10.8

 

 

THE WARRANT EVIDENCED OR CONSTITUTED HEREBY, AND ALL SHARES OF COMMON STOCK
ISSUABLE HEREUNDER, HAVE BEEN AND WILL BE ISSUED WITHOUT REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) AND MAY NOT BE SOLD,
OFFERED FOR SALE, TRANSFERRED, PLEDGED OR HYPOTHECATED WITHOUT REGISTRATION
UNDER THE ACT UNLESS EITHER (i) THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL,
IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE COMPANY, TO THE EFFECT THAT
REGISTRATION IS NOT REQUIRED IN CONNECTION WITH SUCH DISPOSITION OR (ii) THE
SALE OF SUCH SECURITIES IS MADE PURSUANT TO SEC RULE 144.

 

[Form of]

WARRANT TO PURCHASE UNITS
OF
Realco International, Inc.

 

NO. PAW-____ _______, 2015

 

THIS CERTIFIES THAT, for $____ and other valuable consideration received by
Realco International, Inc., a Nevada corporation (the “Company”), [__________],
or its permitted registered assigns (“Holder”), is entitled, subject to the
terms and conditions of this Warrant, at any time or from time to time after the
issuance date of this Warrant (the “Effective Date”), and before 5:00 p.m.
Pacific Time on the seventh (7th) anniversary of the Effective Date (the
“Expiration Date”), to purchase from the Company, ______ Units, each Unit
consisting of one share of the Company’s common stock, par value $0.00001 per
share (the “Common Stock”), and a warrant to purchase one share of Common Stock
at a price of $0.72 per share during the five (5) year period commencing on the
date of this Warrant (the “Unit Warrants”) at a price per Unit equal to $.01
(the “Purchase Price”). Both the number of Units purchasable upon exercise of
this Warrant and the Purchase Price are subject to adjustment and change as
provided herein.

 

1.            CERTAIN DEFINITIONS. As used in this Warrant the following terms
shall have the following respective meanings:

 

1.1           “Fair Market Value” of a share of Common Stock as of a particular
date shall mean:

 

(a)             If traded on a securities exchange or the Nasdaq Stock Market,
the Fair Market Value shall be deemed to be the average of the closing prices of
the Common Stock of the Company on such exchange or market over the five (5)
trading days ending immediately prior to the applicable date of valuation;

 

(b)            If actively traded over-the-counter, the Fair Market Value shall
be deemed to be the average of the closing bid prices over the thirty (30)-day
period ending immediately prior to the applicable date of valuation; and

 

(c)             If there is no active public market, the Fair Market Value shall
be the value thereof, as agreed upon by the Company and the Holder; provided,
however, that if the Company and the Holder cannot agree on such value, such
value shall be determined by an independent valuation firm experienced in
valuing businesses such as the Company and jointly selected in good faith by the
Company and the Holder. Fees and expenses of the valuation firm shall be paid
for by the Company.

 

 1 

 

 

1.2            “Registered Holder” shall mean any Holder in whose name this
Warrant is registered upon the books and records maintained by the Company.

 

1.3            “Warrant” as used herein, shall include this Warrant and any
warrant delivered in substitution or exchange therefor as provided herein.

 

1.4            “Common Stock” shall mean the Common Stock of the Company.

 

2.           EXERCISE OF WARRANT.

 

2.1            Payment. Subject to compliance with the terms and conditions of
this Warrant and applicable securities laws, this Warrant may be exercised, in
whole or in part at any time or from time to time, on or before the Expiration
Date by the delivery (including, without limitation, delivery by facsimile or
email) of the form of Notice of Exercise attached hereto as Exhibit A (the
“Notice of Exercise”), duly executed by the Holder, at the principal office of
the Company, and as soon as practicable after such date, surrendering

 

(a)             this Warrant at the principal office of the Company, and

 

(b)            payment, (i) in cash (by check) or by wire transfer, (ii) by
cancellation by the Holder of indebtedness of the Company to the Holder; or
(iii) by a combination of (i) and (ii), of an amount equal to the product
obtained by multiplying the number of Units being purchased upon such exercise
by the then effective Purchase Price (the “Exercise Amount”).

 

2.2         Stock Certificates; Fractional Shares. As soon as practicable on or
after the date of any exercise of this Warrant, the Company shall issue and
deliver to the person or persons entitled to receive the same a certificate or
certificates for the number of Units issuable upon such exercise, together with
cash in lieu of any fraction of a share equal to such fraction of the current
Fair Market Value of one whole share of Common Stock as of such date of
exercise. No fractional shares or scrip representing fractional shares shall be
issued upon an exercise of this Warrant.

 

2.3         Partial Exercise; Effective Date of Exercise. In case of any partial
exercise of this Warrant, the Company shall cancel this Warrant upon surrender
hereof and shall execute and deliver a new Warrant of like tenor and date for
the balance of the Units purchasable hereunder. This Warrant shall be deemed to
have been exercised immediately prior to the close of business on the date of
its surrender for exercise as provided above. The person entitled to receive the
Units issuable upon exercise of this Warrant shall be treated for all purposes
as the holder of record of such Units as of the close of business on the date
the Holder is deemed to have exercised this Warrant.

 

2.4         Vesting. This Warrant shall vest fully upon issuance.

 

3.            VALID ISSUANCE: TAXES. All Units and shares of Common Stock and
Unit Warrants issued upon the exercise of this Warrant shall be validly issued,
fully paid and nonassessable, and the Company shall pay all taxes and other
governmental charges that may be imposed in respect of the issue or delivery
thereof. The Company shall not be required to pay any tax or other charge
imposed in connection with any transfer involved in the issuance of any
certificate for shares of Common Stock or Unit Warrants in any name other than
that of the Registered Holder of this Warrant, and in such case the Company
shall not be required to issue or deliver any stock certificate or security
until such tax or other charge has been paid, or it has been established to the
Company’s reasonable satisfaction that no tax or other charge is due.

 

 2 

 

 

4.           ADJUSTMENT OF PURCHASE PRICE AND NUMBER OF UNITS. The number of
Units issuable upon exercise of this Warrant (or any shares of stock, Unit
Warrants or other securities or property receivable or issuable upon exercise of
this Warrant) and the Purchase Price are subject to adjustment upon occurrence
of the following events:

 

4.1            Adjustment for Stock Splits, Stock Subdivisions or Combinations
of Shares. The Purchase Price of this Warrant shall be proportionally decreased
and the number of shares of Units issuable upon exercise of this Warrant (or any
shares of stock, Unit Warrants or other securities at the time issuable upon
exercise of this Warrant) shall be proportionally increased to reflect any stock
split or subdivision of the Company’s Common Stock. The Purchase Price of this
Warrant shall be proportionally increased and the number of Units issuable upon
exercise of this Warrant (or any shares of stock, Unit Warrants or other
securities at the time issuable upon exercise of this Warrant) shall be
proportionally decreased to reflect any combination of the Company’s Common
Stock.

 

4.2            Adjustment for Dividends or Distributions of Stock or Other
Securities or Property. In case the Company shall make or issue, or shall fix a
record date for the determination of eligible holders entitled to receive, a
dividend or other distribution with respect to the Common Stock (or any shares
of stock or other securities at the time issuable upon exercise of the Warrant)
payable in (a) securities of the Company or (b) assets (excluding cash dividends
paid or payable solely out of retained earnings), then, in each such case, the
Holder of this Warrant on exercise hereof at any time after the consummation,
effective date or record date of such dividend or other distribution, shall
receive, in addition to the shares of Common Stock and Unit Warrants (or such
other stock or securities) issuable on such exercise prior to such date, and
without the payment of additional consideration therefor, the securities or such
other assets of the Company to which such Holder would have been entitled upon
such date if such Holder had exercised this Warrant on the date hereof and had
thereafter, during the period from the date hereof to and including the date of
such exercise, retained such shares and all such additional securities or other
assets distributed with respect to such shares as aforesaid during such period
giving effect to all adjustments called for by this Section 4.

 

4.3            Reclassification. If the Company, by reclassification of
securities or otherwise, shall change any of the securities as to which purchase
rights under this Warrant exist into the same or a different number of
securities of any other class or classes, this Warrant shall thereafter
represent the right to acquire such number and kind of securities as would have
been issuable as the result of such change with respect to the securities that
were subject to the purchase rights under this Warrant immediately prior to such
reclassification or other change, and the Purchase Price therefor shall be
appropriately adjusted, all subject to further adjustment as provided in this
Section 4. No adjustment shall be made pursuant to this Section 4.3 upon any
conversion or redemption of the Common Stock which is the subject of Section
4.5.

 

 

 

 3 

 

 

4.4            Adjustment for Capital Reorganization, Merger or Consolidation.
In case of any capital reorganization of the capital stock of the Company (other
than a combination, reclassification, exchange or subdivision of shares
otherwise provided for herein), or any merger or consolidation of the Company
with or into another corporation, or the sale of all or substantially all the
assets of the Company then, and in each such case, as a part of such
reorganization, merger, consolidation, sale or transfer, lawful provision shall
be made so that the Holder of this Warrant shall thereafter be entitled to
receive upon exercise of this Warrant, during the period specified herein and
upon payment of the Purchase Price then in effect, the number of shares of stock
or other securities or property of the successor corporation resulting from such
reorganization, merger, consolidation, sale or transfer that a holder of the
shares deliverable upon exercise of this Warrant would have been entitled to
receive in such reorganization, consolidation, merger, sale or transfer if this
Warrant had been exercised immediately before such reorganization, merger,
consolidation, sale or transfer, all subject to further adjustment as provided
in this Section 4. The foregoing provisions of this Section 4.4 shall similarly
apply to successive reorganizations, consolidations, mergers, sales and
transfers and to the stock or securities of any other corporation that are at
the time receivable upon the exercise of this Warrant. If the per-share
consideration payable to the Holder hereof for shares in connection with any
such transaction is in a form other than cash or marketable securities, then the
value of such consideration shall be determined in good faith by the Company’s
Board of Directors. In all events, appropriate adjustment (as determined in good
faith by the Company’s Board of Directors) shall be made in the application of
the provisions of this Warrant with respect to the rights and interests of the
Holder after the transaction, to the end that the provisions of this Warrant
shall be applicable after that event, as near as reasonably may be, in relation
to any shares or other property deliverable after that event upon exercise of
this Warrant.

 

4.5            Conversion of Common Stock. In case all or any portion of the
authorized and outstanding shares of Common Stock of the Company are redeemed or
converted or reclassified into other securities or property pursuant to the
Company’s Certificate of Incorporation or otherwise, or the Common Stock
otherwise ceases to exist, then, in such case, the Holder of this Warrant, upon
exercise hereof at any time after the date on which the Common Stock is so
redeemed or converted, reclassified or ceases to exist (the “Termination Date”),
shall receive, in lieu of the number of shares of Common Stock and Unit Warrants
that would have been issuable upon such exercise immediately prior to the
Termination Date, the securities or property that would have been received if
this Warrant had been exercised in full and the Common Stock and Unit Warrants
received thereupon had been simultaneously converted immediately prior to the
Termination Date, all subject to further adjustment as provided in this Warrant.
Additionally, the Purchase Price shall be immediately adjusted to equal the
quotient obtained by dividing (x) the aggregate Purchase Price of the maximum
number of Units for which this Warrant was exercisable immediately prior to the
Termination Date by (y) the number of Units of the Company for which this
Warrant is exercisable immediately after the Termination Date, all subject to
further adjustment as provided herein.

 

5.           CERTIFICATE AS TO ADJUSTMENTS. In each case of any adjustment in
the Purchase Price, or number or type of shares issuable upon exercise of this
Warrant, the Chief Financial Officer or Controller of the Company shall compute
such adjustment in accordance with the terms of this Warrant and prepare a
certificate setting forth such adjustment and showing in detail the facts upon
which such adjustment is based, including a statement of the adjusted Purchase
Price. The Company shall promptly send (by facsimile or email and by either
first class mail, postage prepaid or overnight delivery) a copy of each such
certificate to the Holder.

 

 

 

 4 

 

 

6.               LOSS OR MUTILATION. Upon receipt of evidence reasonably
satisfactory to the Company of the ownership of and the loss, theft, destruction
or mutilation of this Warrant, and of indemnity reasonably satisfactory to it,
and (in the case of mutilation) upon surrender and cancellation of this Warrant,
the Company will execute and deliver in lieu thereof a new Warrant of like tenor
as the lost, stolen, destroyed or mutilated Warrant.

 

7.               RESERVATION OF COMMON STOCK. The Company hereby covenants that
at all times there shall be reserved for issuance and delivery upon exercise of
this Warrant such number of shares of Common Stock or other shares of capital
stock of the Company as are from time to time issuable upon exercise of this
Warrant and the Unit Warrants and, from time to time, will take all steps
necessary to amend its Certificate of Incorporation to provide sufficient
reserves of shares of Common Stock issuable upon exercise of this Warrant and
the Unit Warrants. All such shares shall be duly authorized, and when issued
upon such exercise, shall be validly issued, fully paid and non-assessable, free
and clear of all liens, security interests, charges and other encumbrances or
restrictions on sale and free and clear of all preemptive rights, except
encumbrances or restrictions arising under federal or state securities laws.
Issuance of this Warrant shall constitute full authority to the Company’s
Officers who are charged with the duty of executing stock certificates to
execute and issue the necessary certificates for shares of Common Stock and Unit
Warrants upon the exercise of this Warrant.

 

8.               TRANSFER AND EXCHANGE. Subject to the terms and conditions of
this Warrant and compliance with all applicable securities laws, this Warrant
and all rights hereunder may be transferred to any Registered Holder’s parent,
subsidiary or affiliate, or, if the Registered Holder is a partnership, to any
partner of such Registered Holder, in whole or in part, on the books of the
Company maintained for such purpose at the principal office of the Company
referred to above, by the Registered Holder hereof in person, or by duly
authorized attorney, upon surrender of this Warrant properly endorsed and upon
payment of any necessary transfer tax or other governmental charge imposed upon
such transfer. Upon any permitted partial transfer, the Company will issue and
deliver to the Registered Holder a new Warrant or Warrants with respect to the
Units not so transferred. Each taker and holder of this Warrant, by taking or
holding the same, consents and agrees that when this Warrant shall have been so
endorsed, the person in possession of this Warrant may be treated by the
Company, and all other persons dealing with this Warrant, as the absolute owner
hereof for any purpose and as the person entitled to exercise the rights
represented hereby, any notice to the contrary notwithstanding; provided,
however, that until a transfer of this Warrant is duly registered on the books
of the Company, the Company may treat the Registered Holder hereof as the owner
for all purposes.

 

9.               RESTRICTIONS ON TRANSFER; REGISTRATION RIGHTS. The Holder shall
be entitled to the registration rights as are contained in the Registration
Rights Agreement of even date herewith, by and among the Company and the Holder,
the provisions of which are deemed incorporated herein by reference. The Holder,
by acceptance hereof, agrees that, absent an effective registration statement
filed with the Securities and Exchange Commission (the “SEC”) under the
Securities Act of 1933, as amended (the “Securities Act”) covering the
disposition or sale of this Warrant or the Common Stock and Unit Warrants issued
or issuable upon exercise hereof, as the case may be, and registration or
qualification under applicable state securities laws, such Holder will not sell,
transfer, pledge, or hypothecate any or all of this Warrant or such Common Stock
or Units Warrants (or shares of Common Stock issuable upon exercise of the Unit
Warrants), as the case may be, unless either (i) the Company has received an
opinion of counsel, in form and substance reasonably satisfactory to the
Company, to the effect that such registration is not required in connection with
such disposition or (ii) the sale of such securities is made pursuant to SEC
Rule 144.

 

 5 

 

 

10.            COMPLIANCE WITH SECURITIES LAWS. By acceptance of this Warrant,
the Holder hereby represents, warrants and covenants that any shares of stock
purchased upon exercise of this Warrant shall be acquired for investment only
and not with a view to, or for sale in connection with, any distribution
thereof; that the Holder has had such opportunity as such Holder has deemed
adequate to obtain from representatives of the Company such information as is
necessary to permit the Holder to evaluate the merits and risks of its
investment in the Company; that the Holder is able to bear the economic risk of
holding such shares as may be acquired pursuant to the exercise of this Warrant
for an indefinite period; that the Holder understands that the shares of stock
acquired pursuant to the exercise of this Warrant will not be registered under
the Securities Act (unless otherwise required pursuant to exercise by the Holder
of the registration rights, if any, granted to the Registered Holder) and will
be “restricted securities” within the meaning of Rule 144 under the Securities
Act and that the exemption from registration under Rule 144 will not be
available for at least one (1) year from the date of exercise of this Warrant,
subject to any special treatment by the SEC for exercise of this Warrant
pursuant to Section 2.2, and even then will not be available unless a public
market then exists for the Company’s securities, adequate information concerning
the Company is then available to the public, and other terms and conditions of
Rule 144 are complied with; and that all stock certificates and Unit Warrant
certificates representing shares of stock or Unit Warrants issued to the Holder
upon exercise of this Warrant or upon conversion of such shares may have affixed
thereto a legend substantially in the following form:

 

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER THE SECURITIES LAWS OF
ANY STATE. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND
RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT
AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE
FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE ISSUER
OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS
IN COMPLIANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

 

11.            NO RIGHTS OR LIABILITIES AS STOCKHOLDERS. This Warrant shall not
entitle the Holder to any voting rights or other rights as a stockholder of the
Company. In the absence of affirmative action by such Holder to purchase Units
by exercise of this Warrant or Common Stock upon conversion thereof (or upon
conversion of the Unit Warrants), no provisions of this Warrant, and no
enumeration herein of the rights or privileges of the Holder hereof shall cause
such Holder hereof to be a stockholder of the Company for any purpose.

 

 

 

 6 

 

 

12.        REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to Holder that:

 

12.1         Due Authorization; Consents. All corporate action on the part of
the Company, its officers, directors and stockholders necessary for (a) the
authorization, execution and delivery of, and the performance of all obligations
of the Company under, this Warrant, and (b) the authorization, issuance,
reservation for issuance and delivery of all of the Units issuable upon exercise
of this Warrant, has been duly taken. This Warrant constitutes a valid and
binding obligation of the Company enforceable in accordance with its terms,
subject, as to enforcement of remedies, to applicable bankruptcy, insolvency,
moratorium, reorganization and similar laws affecting creditors’ rights
generally and to general equitable principles. All consents, approvals and
authorizations of, and registrations, qualifications and filings with, any
federal or state governmental agency, authority or body, or any third party,
required in connection with the execution, delivery and performance of this
Warrant and the consummation of the transactions contemplated hereby and thereby
have been obtained.

 

12.2         Organization. The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and has
all requisite corporate power to own, lease and operate its property and to
carry on its business as now being conducted and as currently proposed to be
conducted.

 

12.3         Valid Issuance of Stock. The outstanding shares of the capital
stock of the Company are duly and validly issued, fully paid and nonassessable,
and such shares, and all outstanding options and other securities of the
Company, have been issued in full compliance with the registration and
prospectus delivery requirements of the Securities Act and the registration and
qualification requirements of all applicable state securities laws, or in
compliance with applicable exemptions therefrom, and all other provisions of
applicable federal and state securities laws, including without limitation,
anti-fraud provisions.

 

12.4         Governmental Consents. All consents, approvals, orders,
authorizations or registrations, qualifications, declarations or filings with
any federal or state governmental authority on the part of the Company required
in connection with the consummation of the transactions contemplated herein
shall have been obtained prior to and be effective as of the Effective Date.

 

13.         NOTICES. Except as may be otherwise provided herein, all notices,
requests, waivers and other communications made pursuant to this Agreement shall
be in writing and shall be conclusively deemed to have been duly given (a) when
hand delivered to the other party; (b) when received when sent by facsimile or
email at the address and number set forth below; (c) three business days after
deposit in the U.S. mail with first class or certified mail receipt requested
postage prepaid and addressed to the other party as set forth below; or (d) the
next business day after deposit with a national overnight delivery service,
postage prepaid, addressed to the parties as set forth below with
next-business-day delivery guaranteed, provided that the sending party receives
a confirmation of delivery from the delivery service provider.

 

To the Company: To the Holder:

500 7th Ave, 17th Floor

New York, NY 10018

Attn: William Gorfein

[_______________]

 

 7 

 

 

Each person making a communication hereunder by facsimile or email shall
promptly confirm by telephone to the person to whom such communication was
addressed each communication made by it by facsimile or email pursuant hereto
but the absence of such confirmation shall not affect the validity of any such
communication. A party may change or supplement the addresses given above, or
designate additional addresses, for purposes of this Section 13 by giving the
other party written notice of the new address in the manner set forth above.

 

14.          HEADINGS. The headings in this Warrant are for purposes of
convenience in reference only, and shall not be deemed to constitute a part
hereof.

 

15.          LAW GOVERNING. This Warrant shall be construed and enforced in
accordance with, and governed by, the laws of the State of New York, without
regard to conflict of law principles of such state.

 

16.          NO IMPAIRMENT. The Company will not, by amendment of its
Certificate of Incorporation or bylaws, or through reorganization,
consolidation, merger, dissolution, issue or sale of securities, 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
Registered Holder of this Warrant against impairment. Without limiting the
generality of the foregoing, the Company (a) will not increase the par value of
any shares of stock issuable upon the exercise of this Warrant above the amount
payable therefor upon such exercise, and (b) will take all such action as may be
necessary or appropriate in order that the Company may validly and legally issue
fully paid and nonassessable shares of Common Stock upon exercise of this
Warrant.

 

17.        NOTICES OF RECORD DATE. In case:

 

17.1         the Company shall take a record of the holders of its Common Stock
(or other stock or securities at the time receivable upon the exercise of this
Warrant), for the purpose of entitling them to receive any dividend or other
distribution, or any right to subscribe for or purchase any shares of stock of
any class or any other securities or to receive any other right; or

 

17.2         of any consolidation or merger of the Company with or into another
corporation, any capital reorganization of the Company, any reclassification of
the capital stock of the Company, or any conveyance of all or substantially all
of the assets of the Company to another corporation in which holders of the
Company’s stock are to receive stock, securities or property of another
corporation; or

 

17.3         of any voluntary dissolution, liquidation or winding-up of the
Company; or

 

17.4         of any redemption or conversion of all outstanding Common Stock;

then, and in each such case, the Company will mail or cause to be mailed to 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, or (ii) the date on which such reorganization,
reclassification, consolidation, merger, conveyance, dissolution, liquidation,
winding-up, redemption or conversion is to take place, and the time, if any is
to be fixed, as of which the holders of record of Common Stock or (such stock or
securities as at the time are receivable upon the exercise of this Warrant),
shall be entitled to exchange their shares of Common Stock (or such other stock
or securities), for securities or other property deliverable upon such
reorganization, reclassification, consolidation, merger, conveyance,
dissolution, liquidation or winding-up. The Company shall use all reasonable
efforts to ensure such notice shall be delivered at least thirty (30) days prior
to the date therein specified.

 

 8 

 

 

18.            SEVERABILITY. If any term, provision, covenant or restriction of
this Warrant is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Warrant shall remain in full force and effect and shall in
no way be affected, impaired or invalidated.

 

19.            COUNTERPARTS. For the convenience of the parties, any number of
counterparts of this Warrant may be executed by the parties hereto and each such
executed counterpart shall be, and shall be deemed to be, an original
instrument.

 

20.            NO INCONSISTENT AGREEMENTS. The Company will not on or after the
date of this Warrant enter into any agreement with respect to its securities
which is inconsistent with the rights granted to the Holders of this Warrant or
otherwise conflicts with the provisions hereof. The rights granted to the
Holders hereunder do not in any way conflict with and are not inconsistent with
the rights granted to holders of the Company’s securities under any other
agreements, except rights that have been waived.

 

21.            SATURDAYS, SUNDAYS AND HOLIDAYS. If the Expiration Date falls on
a Saturday, Sunday or legal holiday, the Expiration Date shall automatically be
extended until 5:00 p.m. the next business day.

 

22.            ENTIRE AGREEMENT. This Warrant contains the sole and entire
agreement and understanding of the parties with respect to the entire subject
matter of this Warrant, and any and all prior discussions, negotiations,
commitments and understandings, whether oral or otherwise, related to the
subject matter of this Warrant are hereby merged herein.

 

 

[Signatures appear on following page.]

 

 

 

 

 

 

 

 

 9 

 

 

IN WITNESS WHEREOF, the parties hereto have executed this Warrant as of the
Effective Date.

 

[HOLDER]

 

 

  REALCO INTERNATIONAL, INC. By:     By:   Its:    Its:  

 

 

 

 

 

 

SIGNATURE PAGE TO WARRANT TO PURCHASE COMMON STOCK

 

 

 

 10 

 

 

EXHIBIT A

 

NOTICE OF EXERCISE

 

(To be executed upon exercise of Warrant)

 

[COMPANY]

 

The undersigned hereby irrevocably elects to exercise the right of purchase
represented by the within Warrant Certificate for, and to purchase thereunder,
the securities of the Company, as provided for therein, and (check the
applicable box):

 

[_] tenders herewith payment of the exercise price in full in the form of cash
or a certified or official bank check in same-day funds in the amount of
$____________ for _________ such securities.

 

Please issue a certificate or certificates for such securities in the name of,
and pay any cash for any fractional share to (please print name, address and
social security number):

 

Name:   Address:   Signature:  

 

Note: The above signature should correspond exactly with the name on the first
page of this Warrant Certificate or with the name of the assignee appearing in
the assignment form below.

 

If said number of Units shall not be all the Units purchasable under the within
Warrant Certificate, a new Warrant is to be issued in the name of said
undersigned for the balance remaining of the Units purchasable thereunder
rounded up to the next higher whole number of Units.

 

 

 11 

 

 

EXHIBIT B

 

ASSIGNMENT

 

(To be executed only upon assignment of Warrant Certificate)

 

For value received, hereby sells, assigns and transfers unto
____________________________ the within Warrant Certificate, together with all
right, title and interest therein, and does hereby irrevocably constitute and
appoint ____________________________ attorney, to transfer said Warrant
Certificate on the books of the within-named Company with respect to the number
of Warrants set forth below, with full power of substitution in the premises:

 

Name(s) of Assignee(s) Address # of Warrants                              

 

And if said number of Warrants shall not be all the Warrants represented by the
Warrant Certificate, a new Warrant Certificate is to be issued in the name of
said undersigned for the balance remaining of the Warrants registered by said
Warrant Certificate.

 

Dated:   Signature:  

 

Notice: The signature to the foregoing Assignment must correspond to the name as
written upon the face of this security in every particular, without alteration
or any change whatsoever; signature(s) must be guaranteed by an eligible
guarantor institution (banks, stock brokers, savings and loan associations and
credit unions with membership in an approved signature guarantee medallion
program) pursuant to Securities and Exchange Commission Rule 17Ad-15.

 

 

 

 

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