Form of Series A P/S Warrant-Equator









Exhibit 4.5




THIS WARRANT AND THE UNDERLYING

SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS

AMENDED (THE “ACT”).  THEY MAY NOT BE

SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE

REGISTRATION STATEMENT AS TO SUCH SECURITIES UNDER THE ACT OR AN OPINION OF

COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.




ON STAGE ENTERTAINMENT, INC.




WARRANT TO PURCHASE COMMON STOCK




No. [        ]                                                                                                                                                                                    ,

2002




Void

After:                              , 2012




THIS CERTIFIES THAT, for value received in connection with

the advance of funds described in that certain promissory note dated the same

date hereof, DELTA FUND, LP, with its principal

office at 3000 Sand Hill Road, Building 3, Suite 290, Menlo Park, California,

or assigns (the “Holder”

or “Purchaser”), is

entitled to subscribe for and purchase at the Exercise Price (defined below)

from ON STAGE ENTERTAINMENT, INC., a Nevada

corporation, with its principal office at 4625 West Nevso Drive, Las Vegas,

Nevada (the “Company”)

nineteen thousand two hundred seventy-seven (19,277)  shares of common stock of

the Company (the “Common Stock”),

as provided herein.




1.             DEFINITIONS.  As used herein, the following terms

shall have the following respective meanings:




“Exercise Period”

shall mean the time period commencing with the date of this Warrant and ending

ten (10) years later.




“Exercise Price”

shall mean zero dollars and fifty cents ($0.50) per share of Common Stock.




“Exercise Shares”

shall mean the shares of the Company’s Common Stock issuable upon exercise of

this Warrant, subject to adjustment pursuant to the terms herein, including

Section 5 below.




2.             EXERCISE OF WARRANT.




2.1.         The rights represented by this Warrant

may be exercised in whole or in part at any time during the Exercise Period, by

delivery of the following to the Company at its address set forth above (or at

such other address as it may designate by notice in writing to the Holder):




(a)           An executed Notice of Exercise in the

form attached hereto;




 





























 




(b)           Payment of the Exercise Price either (i)

in cash or by check, or (ii) by cancellation of indebtedness; and




(c)                                  This Warrant




Upon the exercise of the

rights represented by this Warrant, a certificate or certificates for the

Exercise Shares so purchased, registered in the name of the Holder or persons

affiliated with the Holder, if the Holder so designates, shall be issued and

delivered to the Holder within a reasonable time after the rights represented

by this Warrant shall have been so exercised.




                The person in whose name any certificate or

certificates for Exercise Shares are to be issued upon exercise of this Warrant

shall be deemed to have become the holder of record of such shares on the date

on which this Warrant was surrendered and payment of the Exercise Price was

made, irrespective of the date of delivery of such certificate or certificates,

except that, if the date of such surrender and payment is a date when the stock

transfer books of the Company are closed, such person shall be deemed to have

become the holder of such shares at the close of business on the next

succeeding date on which the stock transfer books are open.




2.2.         Net

Exercise.

Notwithstanding any provisions herein to the contrary, if the fair market value

of one share of the Company’s Common Stock is greater than the Exercise Price

(at the date of calculation as set forth below), in lieu of exercising this

Warrant by payment of cash, the Holder may elect (the “Conversion Right”) to receive shares equal to

the value (as determined below) of this Warrant (or the portion thereof being

canceled) by surrender of this Warrant at the principal office of the Company

together with the properly endorsed Notice of Exercise in which event the

Company shall issue to the Holder a number of shares of Common Stock computed

using the following formula:




X = Y (A-B)




    A




Where    X =          the

number of shares of Common Stock to be issued to the Holder




Y =                              the number of shares of Common Stock

purchasable under the Warrant or, if only a portion of the Warrant is being

exercised, the portion of the Warrant being canceled (at the date of such

calculation)




A =                            the fair market value of one share of the

Company’s Common Stock (at the date of such calculation)




B =                              Exercise Price (as adjusted to the date

of such calculation)




For purposes of the above

calculation, the fair market value of one share of Common Stock shall be:




(a)            the product of (i) the

average daily Market Price (as defined below) during the period of the most

recent ten (10) days, ending on the last business day before the effective date

of exercise of the Conversion Right, on which the national securities exchanges






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were open for

trading and (ii) the number of shares of the Common Stock (as defined herein)

into which each Exercise Share is convertible on such date; or




(b)           if no class of Common Stock is then

listed or admitted to trading on any national securities exchange or quoted in

the over-counter market, the fair market value shall be the Market Price on the

last business day before the effective date of exercise of the Conversion

Right.




(c)           if the

Common Stock is traded on a national securities exchange or admitted to

unlisted trading privileges on such an exchange, or is listed on the National

Market System (the “National Market System”)

of the Nasdaq, the Market Price as of a specified day shall be the last

reported sale price of Common Stock on such exchange or on the National Market

System on such date or if no such sale is made on such day, the mean of the

closing bid and asked prices for such day on such exchange or on the National

Market System.  If the Common Stock is

not so listed or admitted to unlisted trading privileges, the Market Price as

of a specified day shall be the mean of the last bid and asked prices reported

on such date (x) by the Nasdaq or (y) if reports are unavailable under clause

(x) above by the National Quotation Bureau Incorporated.  If the Common Stock is not so listed or

admitted to unlisted trading privileges and bid and ask prices are not

reported, the Market Price as of a specified day shall be determined in good

faith by the Board of Directors of the Company.




3.             COVENANTS OF THE COMPANY.




3.1.         Covenants

as to Exercise Shares.  The Company covenants and

agrees that all Exercise Shares that may be issued upon the exercise of the

rights represented by this Warrant will, upon issuance, be validly issued and

outstanding, fully paid and nonassessable, and free from all taxes, liens and

charges with respect to the issuance thereof. 

The Company further covenants and agrees that the Company will at all

times during the Exercise Period, have authorized and reserved, free from

preemptive rights, a sufficient number of shares of its Common Stock to provide

for the exercise of the rights represented by this Warrant.  If at any time during the Exercise Period

the number of authorized but unissued shares of Common Stock shall not be

sufficient to permit exercise of this Warrant, the Company will take such

corporate action as may, in the opinion of its counsel, be necessary to

increase its authorized but unissued shares of Common Stock to such number of

shares as shall be sufficient for such purposes.




3.2.         No

Impairment.  Except and to the extent as waived or

consented to by the Holder, the Company will not, by amendment of its Articles

of Incorporation or through any reorganization, transfer of assets,

consolidation, merger, dissolution, issue or sale of securities or any other

voluntary action, avoid or seek to avoid the observance or performance of any

of the terms to be observed or performed hereunder by the Company, but will at

all times in good faith assist in the carrying out of all the provisions of

this Warrant and in the taking of all such action as may be necessary or

appropriate in order to protect the exercise rights of the Holder against

impairment.




3.3.         Notices

of Record Date.  In the event of any taking by the Company of

a record of the holders of any class of securities for the purpose of

determining the holders thereof who 




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are entitled to receive

any dividend (other than a cash dividend which is the same as cash dividends

paid in previous quarters) or other distribution, the Company shall mail to the

Holder, at least ten (10) days prior to the date specified herein, a notice

specifying the date on which any such record is to be taken for the purpose of

such dividend or distribution.




4.             REPRESENTATIONS OF HOLDER.




4.1.         Acquisition

of Warrant for Personal Account. The Holder represents and warrants that it is

acquiring the Warrant solely for its account for investment and not with a view

to or for sale or distribution of said Warrant or any part thereof, other than

potential transfers between affiliates (including affiliated funds).  The Holder also represents that the entire

legal and beneficial interests of the Warrant and Exercise Shares the Holder is

acquiring is being acquired for, and will be held for, its account only.




4.2.         Securities Are Not Registered.




(a)           The Holder understands that the Warrant and the

Exercise Shares have not been registered under the Securities Act of 1933, as

amended (the “Act”) on the basis that no distribution or public offering of the

stock of the Company is to be effected. 

The Holder realizes that the basis for the exemption may not be present

if, notwithstanding its representations, the Holder has a present intention of

acquiring the securities for a fixed or determinable period in the future,

selling (in connection with a distribution or otherwise), granting any

participation in, or otherwise distributing the securities.  The Holder has no such present intention,

other than potential transfers between affiliates (including affiliated funds).




(b)           The Holder recognizes that the Warrant and the

Exercise Shares must be held indefinitely unless they are subsequently

registered under the Act or an exemption from such registration is available.




(c)           The Holder is aware that neither the Warrant nor the

Exercise Shares may be sold pursuant to Rule 144 adopted under the Act unless

certain conditions are met, including, among other things, the existence of a

public market for the shares, the availability of certain current public

information about the Company, the resale following the required holding period

under Rule 144 and the number of shares being sold during any three month

period not exceeding specified limitations. 

Holder is aware that the conditions for resale set forth in Rule 144

have not been satisfied and that the Company presently has no plans to satisfy

these conditions in the foreseeable future.




4.3.         Disposition

of Warrant and Exercise Shares.




(a)           The Holder further agrees not to make any

disposition of all or any part of the Warrant or Exercise Shares in any event

unless and until:




(i)            The Company shall have received a letter secured by

the Holder from the Securities and Exchange Commission stating that no action

will be recommended to the Commission with respect to the proposed disposition;

or




 




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(ii)           There is then in effect a registration statement under

the Act covering such proposed disposition and such disposition is made in

accordance with said registration statement; or




(iii)         The Holder shall have notified the Company of the

proposed disposition and shall have furnished the Company with a statement of

the circumstances surrounding the proposed disposition; provided, however, that

such statement will not be required if the disposition is permitted under Rule

144 of the Securities Act.




(b)           The Holder agrees not to sell this Warrant or the

Exercise Shares during a period specified by the representative of the

underwriters of Common Stock (not to exceed one hundred eighty (180) days)

following the effective date of the initial registration statement of the

Company filed under the Act, so long as all officers, directors, and 1%

stockholders have executed similar agreements and are similarly restricted from

selling the Company’s stock.




(c)           Notwithstanding the provisions of paragraphs (a) and

(b) above, the Holder may assign this Warrant and the Exercise Shares to (i) any partner or retired partner of the Holder

if Holder is a partnership, (ii) any member or former member of the Holder if

Holder is a limited liability company, (iii) any affiliate, including

affiliated funds or (iv) any family member or trust for the benefit of the

Holder if the Holder is an individual; provided that the Company is given

written notice thereof.




5.             ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF

SHARES.  The

Exercise Price and the number of shares purchasable upon the exercise of this

Warrant shall be subject to adjustment from time to time upon the occurrence of

certain events described in this Section 5. 

Upon each adjustment of the Exercise Price, the Holder of this Warrant

shall thereafter be entitled to purchase, at the Exercise Price resulting from

such adjustment, the number of shares obtained by multiply­ing the Exercise

Price in effect immediately prior to such adjustment by the number of shares purchasable

pursuant hereto immediately prior to such adjustment, and dividing the product

thereof by the Exercise Price resulting from such adjust­ment.




5.1.         Subdivision

or Combination of Stock. In case the Company shall at any time subdivide its outstanding shares

of the Common Stock into a greater number of shares, the Exercise Price in

effect immediately prior to such subdivision shall be proportionately reduced,

and conversely, in case the outstanding shares of the Common Stock of the

Company shall be combined into a smaller number of shares, the Exercise Price

in effect immediately prior to such combination shall be proportionately

increased.




5.2.         Dividends

in Common Stock, Other Stock, Property, Reclassification. If at any time or from time to time the

holders of the Common Stock (or any shares of stock or other securities at the

time receivable upon the exercise of this Warrant) shall have received or

become entitled to receive, without payment therefor,




(a)           Common Stock or any shares of stock or

other securities which are at any time directly or indirectly convertible into

or exchangeable for the Common Stock, or any rights 




 




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or options to subscribe for, purchase or otherwise

acquire any of the foregoing by way of dividend or other distribution,




(b)           any cash paid or payable otherwise than

as a cash dividend, or




(c)           Common Stock or additional stock or other

securities or property (including cash) by way of spinoff, split-up,

reclassification, combination of shares or similar corporate rearrangement,

(other than shares of the Common Stock issued as a stock split or adjustments

in respect of which shall be covered by the terms of Section 5.1 above), then

and in each such case, the Holder hereof shall, upon the exercise of this

Warrant, be entitled to receive, in addition to the number of shares of Common

Stock receivable thereupon, and without payment of any additional consideration

therefor, the amount of stock and other securities and property (including cash

in the cases referred to in clause (b) above and this clause (c)) which such

Holder would hold on the date of such exercise had he been the holder of record

of such Common Stock as of the date on which holders of the Common Stock

received or became entitled to receive such shares or all other additional

stock and other securities and property.




5.3.            Reorganization, Reclassification,

Consolidation, Merger or Sale.  If any recapitalization, reclassification

or reorganization of the capital stock of the Company, or any consolidation or

merger of the Company with another corporation, or the sale of all or substan­tially

all of its assets or other transaction shall be effected in such a way that

holders of the Common Stock shall be entitled to receive stock, securities, or

other assets or pro­perty (an “Organic Change”), then, as a condition of such Organic

Change, lawful and adequate provi­sions shall be made by the Company whereby

the Holder hereof shall thereafter have the right to purchase and receive (in

lieu of the shares of the Common Stock immediately theretofore purchasable

and receivable upon the exercise of the rights represented hereby) such shares

of stock, securities or other assets or property as may be issued or payable

with respect to or in exchange for a number of outstanding shares of such

Common Stock equal to the number of shares of such stock immediately

theretofore purchasable and receivable upon the exercise of the rights

represented hereby; provided, however, that in the event the value of the

stock, securities or other assets or property (determined in good faith by the

Board of Directors of the Company) issuable or payable with respect to one

share of the Common Stock immediately theretofore purchas­able and receivable

upon the exercise of the rights represented hereby is in excess of the Exercise

Price hereof effective at the time of a merger and securities received in such

reorganization, if any, are publicly traded, then this Warrant shall expire

unless exercised prior to such Organic Change. 

In the event of any Organic Change, appropriate provision shall be made

by the Company with respect to the rights and interests of the Holder of this

Warrant to the end that the provisions hereof (including, without limitation,

provisions for adjustments of the Exercise Price and of the number of shares

purchasable and receivable upon the exercise of this Warrant) shall thereafter

be applicable, in relation to any shares of stock, securities or assets

thereafter deliverable upon the exercise hereof.  The Company will not effect any such con­solida­tion, merger or

sale unless, prior to the consummation thereof, the successor corporation (if

other than the Company) resulting from such consolidation or the corporation

purchasing such assets shall assume by written instrument reasonably

satisfactory in form and substance to the Holder substantially similar to this

Warrant to purchase the Common Stock then outstanding, executed and mailed or

delivered to the registered Holder hereof at the last address of such 




 




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Holder appearing on the books of the Company, the

obligation to deliver to such Holder such shares of stock, securities or assets

as, in accordance with the foregoing provisions, such Holder may be entitled to

purchase.




5.4.         Certain

Events.  If any change in the outstand­ing Common

Stock or any other event occurs as to which the other provisions of this

Section 5 are not strictly applicable or if strictly applicable would not

fairly protect the purchase rights of the Holder of the Warrant in accordance

with such provisions, then the Board of Directors of the Company shall make an

adjustment in the number and class of shares available under the Warrant, the

Exercise Price or the application of such provisions, so as to protect such

purchase rights as aforesaid.  The

adjustment shall be such as will give the Holder of the Warrant upon exercise

for the same aggregate Exercise Price the total number, class and kind of

shares as he would have owned had the Warrant been exercised prior to the event

and had he continued to hold such shares until after the event requiring

adjustment.




5.5.         Notices of

Change.




(a)           Immediately upon any adjustment in the

number or class of shares subject to this Warrant and of the Exercise Price,

the Company shall give written notice thereof to the Holder, setting forth in

reasonable detail and certifying the calculation of such adjustment.




(b)           The Company shall give written notice to

the Holder at least 10 business days prior to the date on which the Company

closes its books or takes a record for determining rights to receive any

dividends or distributions.




(c)           The Company shall also give written

notice to the Holder at least 30 business days prior to the date on which an

Organic Change shall take place.




6.             FRACTIONAL SHARES.  No fractional shares shall be issued upon

the exercise of this Warrant as a consequence of any adjustment pursuant

hereto.  All Exercise Shares (including

fractions) issuable upon exercise of this Warrant may be aggregated for

purposes of determining whether the exercise would result in the issuance of

any fractional share.  If, after

aggregation, the exercise would result in the issuance of a fractional share,

the Company shall, in lieu of issuance of any fractional share, pay the Holder

otherwise entitled to such fraction a sum in cash equal to the product

resulting from multiplying the then current fair market value of an Exercise

Share by such fraction.




7.             NO STOCKHOLDER RIGHTS.  This Warrant in and of itself shall not

entitle the Holder to any voting rights or other rights as a stockholder of the

Company.




8.             TRANSFER OF WARRANT.  Subject to applicable laws, this Warrant and

all rights hereunder are transferable, by the Holder in person or by duly

authorized attorney, upon delivery of this Warrant and the form of assignment

attached hereto to any transferee designated by Holder.




9.             LOST, STOLEN, MUTILATED OR DESTROYED WARRANT.  If this Warrant is lost, stolen, mutilated

or destroyed, the Company may, on such terms as to indemnity or otherwise as 




 




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it may

reasonably impose (which shall, in the case of a mutilated Warrant, include the

surrender thereof), issue a new Warrant of like denomination and tenor 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 be at any time enforceable by anyone.




10.          NOTICES, ETC.  All notices and other communications required

or permitted hereunder shall be in writing and shall be sent by facsimile,

express mail or other form of rapid communications, if possible, and if not

then such notice or communication shall be mailed by first-class mail, postage

prepaid, addressed in each case to the party entitled thereto at the following

addresses:  (a) if to the Company,

to On Stage Entertainment, Inc., Attention: President, 4625 West Nevso Drive,

Las Vegas, Nevada  89103 and (b) if

to the Holder, to McCown De Leeuw & Co., Inc. and Affiliates, 3000 Sand

Hill Road, Building 3, Suite 290, Menlo Park, California, Attn: Robert B.

Hellman, Jr., or at such other address as one party may furnish to the other in

writing.  Notice shall be deemed

effective on the date dispatched if by personal delivery or confirmed facsimile

transmission, two days after mailing if by express mail, three days after

mailing if by first-class mail within California, or five days if by

first-class mail outside of California.




11.          ACCEPTANCE.  Receipt of this Warrant by the Holder shall

constitute acceptance of and agreement to all of the terms and conditions

contained herein.




12.          EQUITABLE RELIEF.  The Holder

recognizes and affirms if it fails to exercise the Warrant within 10 days after

a final decision has been rendered by the Arbitrator pursuant to Section 2, the

Company would have no adequate remedy at law. 

The Holder therefore agrees that the Company shall be entitled to

injunctive relief or other equitable relief in addition to any other rights and

remedies existing in its favor




13.          GOVERNING LAW.  This Warrant and all rights, obligations and

liabilities hereunder shall be governed by the laws of the State of California.




 




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IN WITNESS WHEREOF, the Company has caused this Warrant to

be executed by its duly authorized officer as of

                                                           .




	

   


  	

  ON STAGE ENTERTAINMENT, INC.


  
	

   


  	

   


  
	

   


  	

   


  
	

   


  	

  By:


  	

   


  
	

   


  	

   


  	

   


  
	

   


  	

  Name:


  	

   


  
	

   


  	

   


  	

   


  
	

   


  	

  Title:


  	

   


  





 




 




9





























NOTICE OF

EXERCISE




 




 




TO: 

ON STAGE ENTERTAINMENT, INC.




 




(1)           The undersigned hereby elects to

purchase                                   

shares of the Common Stock of ON STAGE ENTERTAINMENT, INC.

(the “Company”) pursuant to the terms of the attached Warrant, and tenders

herewith payment of the exercise price in full, together with all applicable

transfer taxes, if any.




 (2)          Please

issue a certificate or certificates representing said shares of Common Stock in

the name of the undersigned or in such other name as is specified below:




 




	

   


  
	

   


  
	

  (Name)


  
	

   


  
	

   


  
	

   


  
	

   


  
	

  (Address)


  





 




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(3)           The

undersigned represents that (i) the aforesaid shares of Common Stock are being

acquired for the account of the undersigned for investment and not with a view

to, or for resale in connection with, the distribution thereof and that the

undersigned has no present intention of distributing or reselling such shares;

(ii) the undersigned is aware of the Company’s business affairs and financial

condition and has acquired sufficient information about the Company to reach an

informed and knowledgeable decision regarding its investment in the Company;

(iii) the undersigned is experienced in making investments of this type and has

such knowledge and background in financial and business matters that the

undersigned is capable of evaluating the merits and risks of this investment

and protecting the undersigned’s own interests; (iv) the undersigned

understands that the shares of Common Stock issuable upon exercise of this

Warrant have not been registered under the Securities Act of 1933, as amended

(the “Securities Act”), by reason of a specific exemption from the registration

provisions of the Securities Act, which exemption depends upon, among other

things, the bona fide nature of the investment intent as expressed herein, and,

because such securities have not been registered under the Securities Act, they

must be held indefinitely unless subsequently registered under the Securities

Act or an exemption from such registration is available; (v) the undersigned is

aware that the aforesaid shares of Common Stock may not be sold pursuant to

Rule 144 adopted under the Securities Act unless certain conditions are met and

until the undersigned has held the shares for the number of years prescribed by

Rule 144, that among the conditions for use of the Rule is the availability of

current information to the public about the Company and the Company has not

made such information available and has no present plans to do so; and (vi) the

undersigned agrees not to make any disposition of all or any part of the

aforesaid shares of Common Stock unless and until there is then in effect a

registration statement under the Securities Act covering such proposed

disposition and such disposition is made in accordance with said registration

statement, or the undersigned has provided the Company with an opinion of

counsel satisfactory to the Company, stating that such registration is not

required.




 




 




 




	

   


  	

   


  	

   


  
	

  (Date)


  	

   


  	

  (Signature)


  
	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  
	

   


  	

   


  	

  (Print name)


  





 




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ASSIGNMENT

FORM




(To assign the foregoing Warrant, execute 


this form and supply required information. 




Do not use this form to purchase shares.)




FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced

thereby are hereby assigned to




	

   


  
	

  Name:


  	

   


  
	

  (Please Print)


  
	

   


  
	

  Address:


  	

   


  
	

  (Please Print)


  
	

   


  
	

  Dated:


  	

   


  	

   


  
	

   


  
	

  Holder’s


  
	

  Signature:


  	

   


  	

   


  
	

   


  
	

  Holder’s


  
	

  Address:


  	

   


  	

   


  
					





 




NOTE: 

The signature to this Assignment Form must correspond with the name as

it appears on the face of the Warrant, without alteration or enlargement or any

change whatever.  Officers of

corporations and those acting in a fiduciary or other representative capacity

should file proper evidence of authority to assign the foregoing Warrant.




 




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