EXHIBIT 4.19


 


THESE SECURITIES
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE
SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD OR OFFERED FOR SALE IN
THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES OR AN
OPINION OF COUNSEL OR OTHER EVIDENCE ACCEPTABLE TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED.


 


FOCUS
ENHANCEMENTS, INC.


 


COMMON
STOCK PURCHASE WARRANT


 


1.                                       Issuance;
Certain Definitions. For good and valuable consideration, the receipt of
which is hereby acknowledged by FOCUS ENHANCEMENTS, INC.,
a Delaware corporation (the “Company”), Crestline
Consultancy Ltd, or registered
assigns (the “Holder”) is hereby granted the right to purchase at any time
until 5:00 P.M., New York City time, on December 6,
2009 (the “Expiration Date”), 60,000 (sixty thousand)
fully paid and non-assessable shares of the Company’s Common Stock, $0.01 par
value per share (the “Common Stock”), at an initial exercise price  (the “Exercise Price”) of $1.00 (one dollar) per share, subject
to further adjustment as set forth herein. 
These shares are exercisable immediately 


 


2.                                       Exercise
of Warrants.


 


(a)                                  This
Warrant is exercisable in whole or in part at any time and from time to
time.  Such exercise shall be effectuated
by submitting to the Company (either by delivery to the Company or by facsimile
transmission as provided in Section 8 hereof) a completed and duly
executed Notice of Exercise (substantially in the form attached to this
Warrant) as provided in this paragraph. 
The date such Notice of Exercise is faxed to the Company shall be the “Exercise
Date,” provided that the Holder of this Warrant tenders this Warrant
Certificate to the Company within five (5) business days thereafter and at
the time of such Notice of Exercise the Company has received payment for the
shares being purchased.  The Notice of
Exercise shall be executed by the Holder of this Warrant and shall indicate the
number of shares then being purchased pursuant to such exercise.  Upon surrender of this Warrant Certificate,
together with appropriate payment of the Exercise Price for the shares of
Common Stock purchased, the Holder shall be entitled to receive a certificate
or certificates for the shares of Common Stock so purchased.


 


(b)                                 The
Exercise Price per share of Common Stock for the shares then being exercised
shall be payable in cash by wire, certified or official bank check.


 


(c)                                  In
no event shall Holder exercise this Warrant for less than ten thousand (10,000)
Warrant Shares unless the Holder has a Warrant for less than ten 


 





















 


thousand (10,000)
Warrant Shares, in which case Holder shall be required to exercise the Warrant
for all remaining Warrant Shares on the Exercise Date.


 


(d)                                 The
Holder shall be deemed to be the holder of the shares issuable to it in
accordance with the provisions of this Section 2 only on and after the
Exercise Date.


 


3.                                       Reservation
of Shares. At all times during the term of this Warrant the Company  shall 
reserve for issuance upon exercise of this Warrant such number of shares
of its Common Stock as shall be required for issuance upon exercise of this
Warrant (the “Warrant Shares”).


 


4.                                       Mutilation
or Loss of Warrant.  Upon receipt by
the Company of evidence satisfactory to it of the loss, theft, destruction or
mutilation of this Warrant, and (in the case of loss, theft or destruction)
receipt of reasonably satisfactory indemnification, and (in the case of
mutilation) upon surrender and cancellation of this Warrant, the Company will
execute and deliver a new Warrant of like tenor and date and any such lost,
stolen, destroyed or mutilated Warrant shall thereupon become void.


 


5.                                       Rights
of the Holder.  Until the Warrant is
exercised in whole or in part, the Holder shall not, by virtue hereof, be
entitled to any rights of a stockholder in the Company, either at law or
equity, and the rights of the Holder shall be limited to those expressed in
this Warrant and are not enforceable against the Company except to the extent
set forth herein.


 


6.                                       Adjustments.


 


6.1                                 Adjustment
Mechanism.  If an adjustment of the
Exercise Price is required pursuant to this Section 6, the Holder shall be
entitled to purchase such number of shares of Common Stock as will cause (i) the
total number of shares of Common Stock Holder is entitled to purchase pursuant
to this Warrant, multiplied by (ii) the adjusted Exercise Price per share,
to equal (iii) the dollar amount of the total number of shares of Common
Stock Holder is entitled to purchase before adjustment multiplied by the total
Exercise Price immediately before adjustment.


 


6.2                                 Capital
Adjustments.  In case of any stock
split or reverse stock split, stock dividend, reclassification of the Common
Stock, recapitalization, merger or consolidation, or like capital adjustment
affecting the Common Stock of the Company prior to the exercise of this Warrant
or its applicable portion, the provisions of this Section 6 shall be
applied as if such capital adjustment event had occurred immediately prior to
the exercise date of this Warrant and the original Exercise Price had been
fairly allocated to the stock resulting from such capital adjustment; and in
other respects the provisions of this Section shall be applied in a fair,
equitable and reasonable manner, as determined by the Company’s Board of
Directors in its absolute discretion,  so
as to give effect, as nearly as may be practicable, to the purposes hereof.


 


6.3                                 Spin
Off.  If, for any reason, prior to
the exercise of this Warrant in full, the Company spins off or otherwise
divests itself of a part of its business or operations or disposes all or of a
part of its assets in a transaction (the “Spin Off”) 


 


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in which the Company does not receive compensation for
such business, operations or assets, but causes securities of another entity to
be issued to Common Stock security holders of the Company, then the Company
shall  notify the Holder at least
twenty  (20) days prior to the record
date with respect to such Spin-Off.


 


7.                                       Transfer
to Comply with the Securities Act; Restriction on Sales; Registration Rights.


 


7.1                                 Transfer.  This Warrant has not been registered under
the Securities Act of 1933, as amended, (the “Act”) and has been issued to the
Holder for investment and not with a view to the distribution of either the Warrant
or the Warrant Shares.  Neither this
Warrant nor any of the Warrant Shares or any other security issued or issuable
upon exercise of this Warrant may be sold, transferred, pledged or hypothecated
in the absence of an effective registration statement under the Act relating to
such security or an opinion of counsel satisfactory to the Company that
registration is not required under the Act. 
Each certificate for the Warrant, the Warrant Shares and any other
security issued or issuable upon exercise of this Warrant shall contain a
legend on the face thereof, in form and substance satisfactory to counsel for
the Company, setting forth the restrictions on transfer contained in this
Section.  Notwithstanding any other provision
hereof, of Exhibit 1, or of applicable securities laws, including,
without limitation, Rule 144, 
Holder agrees that under no circumstances shall Holder sell, alienate
or  otherwise transfer  all or any portion of the Warrant or  Warrant Shares before March 22, 2006.


 


7.2                                 Registration
Rights. As set forth in Exhibit 1, Holder shall have piggy-back
registration rights with respect to the Warrant Shares then held by the Holder
or then subject to issuance upon exercise of this Warrant (collectively, the “Remaining
Warrant Shares”).


 


8.                                       Notices.  Any notice or other communication required or
permitted hereunder shall be in writing and shall be delivered personally
(including by recognized courier), sent by facsimile transmission, or sent by
certified, registered or express mail, postage pre-paid.  Any such notice shall be deemed given when so
delivered personally, or sent by facsimile transmission, or, if mailed, four
days after the date of prepaid deposit in the United States mail, certified,
registered or overnight delivery as follows:


 


if to the Company, to:


 


FOCUS ENHANCEMENTS, INC.


1370 Dell Avenue


Campbell, California 95008


ATTN: Gary Williams, Chief Financial  Officer


Telephone No.: (408) 866-8300


Facsimile No.:  (408) 866-4795


 


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with a copy to:


 


Manatt, Phelps & Phillips, LLP


1001 Page Mill Road, Bldg. 2


Palo Alto, California 94304


Attn: Jerrold F. Petruzzelli, Esq.


Telephone No.: (650) 812-1335


Telecopier No.: (650) 213-0260


 


(ii) if
to the Holder, to:


 


 


 


 


Telecopier No.:


 


 


Any party may give notice to the
other parties designated in accordance with this Section to change its
respective address or addressee for notices.


 


9.                                       Supplements
and Amendments; Whole Agreement. 
This Warrant may be amended or supplemented only by an instrument in writing
signed by the parties hereto.  This
Warrant contains the full understanding of the parties with respect to its  subject matter,  and there are no representations, warranties,
agreements or understandings other than expressly contained herein and therein.


 


10.                                 Governing
Law.  This Warrant shall be deemed to
be a contract made under the laws of the State of Delaware for contracts to be
wholly performed in such state and without giving effect to the principles
thereof regarding the conflict of laws. 
Each of the parties consents to the jurisdiction of the federal courts
whose districts encompass any part of the State of California, Santa Clara
County in connection with any dispute arising under this Warrant and hereby
waives, to the maximum extent permitted by law, any objection, including any
objection based on forum non conveniens, to the
bringing of any such proceeding in such jurisdictions.


 


11.                                 Jury
Trial Waiver.  The Company and the
Holder hereby waive a trial by jury in any action, proceeding or counterclaim
brought by either of the parties hereto against the other in respect of any
matter arising out or in connection with this Warrant.


 


12.                                 Counterparts.  This Warrant may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute but one and
the same instrument.


 


13.                                 Descriptive
Headings.  Descriptive headings of
the several Sections of this Warrant are inserted for convenience only and
shall not control or affect the meaning or construction of any of the
provisions hereof.


 


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IN WITNESS WHEREOF, the parties hereto have executed
this Warrant as of the 6th day of December, 2005.


 


	
   

  	
  FOCUS ENHANCEMENTS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gary Williams

  	
   

  
	
   

  	
   

  
	
   

  	
  Name: Gary Williams

  
	
   

  	
  Title: EVP of Finance & CFO

  



 


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NOTICE
OF EXERCISE OF WARRANT


 


The undersigned
hereby irrevocably elects to exercise the right, represented by the Warrant
Certificate dated as of                                   ,
         , to purchase                               
shares of the Common Stock, $0.01 par value, of FOCUS
ENHANCEMENTS, INC.,  and
tenders herewith payment in accordance with Section 1 of said Common Stock
Purchase Warrant.


 


	
   

  	
  CASH:

  	
  $=                                                  
  – (Exercise Price x Exercise Shares)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Payment
  is being made by:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  enclosed
  check

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  wire
  transfer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  other

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Please
  deliver the stock certificate to:

  
	
   

  	
   

  
	
   

  	
   

  
	
  Dated:

  
	
   

  
	
   

  
	
  [Name of Holder]

  
	
   

  
	
  By: