Document:

ex10_6.htm

    
      

    

    Exhibit
10.6

    

    [EXECUTION
VERSION]

    NON-COMPETITION
AGREEMENT

    

    This
Non-Competition Agreement dated December ___, 2009 (the "Non-Competition
Agreement"), is by and among Joy Club of Austin, Inc., a Texas corporation (the
“Company”), RCI Entertainment (3105 I-35), Inc., a Texas corporation (the
“Buyer”), and ___________ (“_________”).

    

    W
I T N E S S E T H:

    

    WHEREAS,
_________ is the owner of 51% of the issued and outstanding stock of Company;
and

    

    WHEREAS,
the Company owns and operates an adult entertainment cabaret known as Joy of
Austin located at 3105 South IH 35, Round Rock, Texas  78664 (the
“Club”); and

    

      
         WHEREAS, simultaneously
herewith, _________ has entered into a Purchase Agreement (the “Purchase
Agreement”) to sell to the Buyer his 51% ownership interest in the Company (the
“Transaction”); and

    

    WHEREAS,
_________ will benefit from the Transaction; and

    

          
     WHEREAS, the Buyer requires that _________ enter
into this Non-Competition Agreement as a condition to the Buyer entering into
the Transaction; and

    

    WHEREAS,
_________ agrees to enter into this Non-Competition Agreement in consideration
of the Buyer’s acts as contemplated by the Transaction; and

    

    NOW,
THEREFORE, in consideration of the premises, the closing of the Transaction and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, _________ and the Company agree as follows:

    

    1.      
     Covenants.     From
and after the date of this Non-Competition Agreement through and including the
____ (__) year period immediately following the date of this Non-Competition
Agreement (such ____ (__) year period, the “Restricted Period”), _________ shall
not compete with the Company, the Buyer, or the Club, or any of their
affiliates, and shall not either individually or jointly, directly or
indirectly, whether for compensation or not, alone or in association with any
other person or entity:

    
      	
               
      

            	 

    

    
      	
               
      

            	
              (a)

            	
              Own
      or share in the earnings of, carry on, manage, operate, control, be
      engaged in, render services to, solicit customers for, participate in or
      otherwise be connected with, any business engaged in the operation of an
      establishment featuring live female nude or semi-nude entertainment
      within  a five (5) mile radius of the Club;
  or

            

    

     

    Non-Competition Agreement -
Page 1 of 5

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              (b)

            	
              Solicit
      or induce, or attempt to solicit or induce, any employee, independent
      contractor, or agent or consultant of the Company, the Buyer or any of
      their affiliates or the Club to leave his or her employment or terminate
      his or her agreement or relationship with the Company, the Buyer or any of
      their affiliates or the Club.

            

    

    

    
      	
               
      

            	
              (c)

            	
              NOTWITHSTANDING
      THE FOREGOING, it is agreed that this Non-Competition Agreement, and the
      restrictions contained herein, shall terminate and be of no further force
      and effect in the event the Buyer defaults in the payment of the secured
      promissory note (the “Note”) as contemplated in the Purchase Agreement and
      such default is not cured after _________ provides Buyer written notice
      and opportunity to cure as provided for in the
  Note.

            

    

    

    2.      
                             
' Acknowledgments and Agreements.  _________
acknowledges and agrees that:

    

    
      	
               
      

            	
              (a)

            	
              Due
      to the nature of the Company's business, the foregoing covenants place no
      greater restraint upon _________ than is reasonably necessary to protect
      the business and goodwill of the
Company;

            

    

    

    
      	
               
      

            	
              (b)

            	
              These
      covenants protect a legitimate interest of the Company and do not serve
      solely to limit the Company's future
  competition;

            

    

    

    
      	
               
      

            	
              (c)

            	
              This
      Non-Competition Agreement is not an invalid or unreasonable restraint of
      trade;

            

    

    

    
      	
               
      

            	
              (d)

            	
              A
      breach of these covenants by would cause irreparable damage to the
      Company;

            

    

    

    
      	
               
      

            	
              (e)

            	
              These
      covenants will not preclude _________ from becoming gainfully employed
      following the closing of the Purchase
Agreement;

            

    

    

    
      	
               
      

            	
              (f)

            	
              These
      covenants are reasonable in scope and are reasonably necessary to protect
      the Company's business and goodwill and valuable and extensive trade which
      the Company has established through its own expense and
      effort;

            

    

    

    
      	
               
      

            	
              (g)

            	
              The
      signing of this Non-Competition Agreement is necessary as part of the
      consummation of the Transaction previously discussed;
  and

            

    

    

    
      	
               
      

            	
              (h)

            	
              _________
      has carefully read and considered all provisions of this Non-Competition
      Agreement and that all of the restrictions set forth are fair and
      reasonable and are reasonably required for the protection of the interests
      of the Company.

            

    

     

    Non-Competition Agreement -
Page 2 of 5

      
        
           

        

        
           

          
            

          

        

        
           

        

      

    3.      
     Remedies,
Injunction.  In the event of
_________’ actual breach of any provisions of this Non-Competition Agreement,
_________ agrees that the Company shall be entitled to a temporary restraining
order, preliminary injunction and/or permanent injunction restraining and
enjoining _________ from violating the provisions herein.  Nothing in
this Non-Competition Agreement shall be construed to prohibit the Company from
pursuing any other available remedies for such breach or threatened breach,
including the recovery of damages from _________.  _________ further
agrees that for the purpose of any such injunction proceeding, it shall be
presumed that the Company's legal remedies would be inadequate and that the
Company would suffer irreparable harm as a result of _________’ violation of the
provisions of this Non-Competition Agreement.

    

    4.     
      Severability.  In the event that
any of the provisions of this Non-Competition Agreement are held to be invalid
or unenforceable in whole or in part, those provisions to the extent enforceable
and all other provisions shall nevertheless continue to be valid and enforceable
as though the invalid or unenforceable parts had not been included in this
Non-Competition Agreement.  In the event that any provision relating
to the time period or scope of a restriction shall be declared by a court of
competent jurisdiction to exceed the maximum time period or scope such court
deems reasonable and enforceable, then the time period or scope of the
restriction deemed reasonable and enforceable by the court shall become and
shall thereafter be the maximum time period or the applicable scope of the
restriction.  _________ further agrees that such covenants and/or any
portion thereof are severable, separate and independent, and should any specific
restriction or the application thereof, to any person, firm, corporation, or
situation be held to be invalid, that holding shall not affect the remainder of
such provisions or covenants.

    

    5.      
      General
Provisions.

    

    
      	
               
      

            	
              (a)

            	
              Notices.  Any
      notices to be given hereunder by either party to the other may be effected
      either by personal delivery in writing or by mail, registered or
      certified, postage prepaid with return receipt requested or by a
      recognized overnight delivery service.  Mailed notices shall be
      addressed to the parties at the addresses set forth below, but each party
      may change their address by written notice in accordance with this
      Paragraph (a).  Notices delivered personally shall be deemed
      communicated as of actual receipt; mailed notices shall be deemed
      communicated as of three (3) days after mailing; and overnight delivery
      service shall be deemed delivered one (1) day after depositing with the
      overnight delivery service.

            

    

    

    
      	
               
      

            	
              If
      to Company

            	
              Joy
      of Austin, Inc.

            

    

    
      	
               
      

            	
              or
      Buyer:

            	
              c/o
      RCI Entertainment (3105 I-35), Inc.

            

    

    Attn:  Eric
Langan, President

    10959
Cutten Road

    Houston,
Texas 77066

     

    Non-Competition Agreement -
Page 3 of 5

      
        
           

        

        
           

          
            

          

        

        
           

        

      

    
      
        	
                 
      

              	
                With
      a copy to:

              	
                Mr.
      Robert D. Axelrod

              

      

    

    Axelrod,
Smith & Kirshbaum

    5300
Memorial Drive, Suite 700

    Houston,
Texas 77007

    

    If to
_________:                 
____________

    ____________

    ____________

    

    With a
copy
to:                    ____________

    ____________

    ____________

    ____________

    ____________

    

    
      	
               
      

            	
              (b)

            	
              Law Governing Non-Competition
      Agreement and Venue.  This Non-Competition Agreement
      shall be governed by and construed in accordance with the laws of the
      State of Texas.  Venue shall be in Travis County, Texas for any
      legal proceeding to enforce the terms, conditions or covenants contained
      herein.

            

    

    

    
      	
               
      

            	
              (c)

            	
              Contract Terms to be
      Exclusive.  This Non-Competition Agreement contains the
      sole and entire agreement between the parties and shall supersede any and
      all other agreements between the parties with respect to _________’
      agreement not to compete with the
Company.

            

    

    

    
      	
               
      

            	
              (d)

            	
              Waiver or Modification
      Ineffective Unless in Writing.  It is further agreed that
      no waiver or modification of this Non-Competition Agreement or of any
      covenant, condition, or limitation herein contained shall be valid unless
      in writing and duly executed by the party to be charged therewith and that
      no evidence of any waiver or modification shall be offered or received in
      evidence in any proceeding or litigation between the parties hereto
      arising out of or affecting this Non-Competition Agreement, or the rights
      or obligations of any party hereunder, unless such waiver or modification
      is in writing, duly executed as
aforesaid.

            

    

    

    
      	
               
      

            	
              (e)

            	
              Assignment.  The
      rights and benefits of the Company under this Non-Competition Agreement
      shall inure to the benefit of and be binding upon the successors and
      assigns of the Company.  The rights of _________ hereunder are
      personal and nontransferable except that the rights and benefits hereof
      shall inure to the benefit of the heirs, executors and legal
      representatives of _________.

            

    

     

    Non-Competition Agreement -
Page 4 of 5

      
        
           

        

        
           

          
            

          

        

        
           

        

      

    
      	
               
      

            	
              (f)

            	
              Binding
      Effect.  Except as otherwise provided herein, this
      Non-Competition Agreement shall be binding upon and inure to the benefit
      of the parties hereto and their respective successors and
      assigns.

            

    

    

    
      	
               
      

            	
              (g)

            	
              Execution.  This
      Non-Competition Agreement may be executed in two or more counterparts, all
      of which when taken together shall be considered one and the same
      agreement and shall become effective when counterparts have been signed by
      each party and delivered to the other party, it being understood that both
      parties need not sign the same counterpart.  In the event that
      any signature is delivered by facsimile transmission or by e-mail delivery
      of a “.pdf” format data file, such signature shall create a valid and
      binding obligation of the party executing (or on whose behalf such
      signature is executed) with the same force and effect as if such facsimile
      or “.pdf” signature page were an original
  thereof.

            

    

    

               IN
WITNESS WHEREOF, this Non-Competition Agreement has been executed as of the
______ day of ______________, 2009.

    

    
      	 
      	
              JOY
      CLUB OF AUSTIN, INC.

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
              By:

            	 
      
	 
      	 
      	
              Eric
      Langan, President

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
              RCI
      ENTERTAINMENT (3105 I-35), INC.

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
              By:

            	 
      
	 
      	 
      	
              Eric
      Langan, President

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
              By:

            	 
      
	 
      	 
      	
              ___________,
      Individually

            

    

    

     

    Non-Competition Agreement -
Page 5 of 5WARRANT
AGREEMENT

    

    Agreement made as of January __, 2010
between 57TH STREET GENERAL ACQUISITION
CORP., a Delaware corporation, with offices at 590 Madison Avenue,
35th
Floor, New York, New York 10022 (the “Company”), and Continental
Stock Transfer & Trust Company, a New York corporation, with offices at 17
Battery Place, New York, New York 10004 (“Warrant Agent”).

    

    WHEREAS, the Company has received a
binding commitment from 57th Street GAC Holdings LLC, a limited liability
company, wholly owned by certain officers and directors of the Company (the
“Insiders”), to purchase an aggregate of 3,000,000 warrants (“Insider Warrants”)
simultaneously with the Public Offering (as defined below) pursuant to a
Subscription Agreement dated as of October 30, 2009 (the “Subscription
Agreement”); and

    

    WHEREAS, the Company is engaged in a
public offering (“Public Offering”) of units, each unit comprised of one share
of Common Stock (as defined below) and one Public Warrant (as defined below)
(the “Units”) and, in connection therewith, has determined to issue and deliver
(i) up to 5,750,000 Warrants to public investors (“Public Warrants” and,
together with the Insider Warrants, the “Warrants”), each of such Warrants
evidencing the right of the holder thereof to purchase one share of Common Stock
of the Company, par value $.0001 per share (Common Stock”), for $11.50, subject
to adjustment as described herein; and

    

    WHEREAS, the Company has filed with the
Securities and Exchange Commission a Registration Statement on Form S-1, No.
333-163134 (“Registration Statement”), for the registration, under the
Securities Act of 1933, as amended (“Act”) of, among other securities, the
Warrants and the shares of Common Stock issuable upon exercise of the Warrants;
and

    

    WHEREAS, the Company desires the
Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing
to so act, in connection with the issuance, registration, transfer, exchange,
redemption and exercise of the Warrants; and

    

    WHEREAS, the Company desires to provide
for the form and provisions of the Warrants, the terms upon which they shall be
issued and exercised, and the respective rights, limitation of rights, and
immunities of the Company, the Warrant Agent, and the holders of the Warrants;
and

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    WHEREAS, all acts and things have been
done and performed which are necessary to make the Warrants, when executed on
behalf of the Company and countersigned by or on behalf of the Warrant Agent, as
provided herein, the valid, binding and legal obligations of the Company, and to
authorize the execution and delivery of this Agreement.

    

    NOW, THEREFORE, in consideration of the
mutual agreements herein contained, the parties hereto agree as
follows:

    

    1.           Appointment of Warrant
Agent.  The Company hereby appoints the Warrant Agent to act as
agent for the Company for the Warrants, and the Warrant Agent hereby accepts
such appointment and agrees to perform the same in accordance with the terms and
conditions set forth in this Agreement.

    

    2.           Warrants.

    

    2.1.         Form of
Warrant.  Each Warrant shall be issued in registered form only,
shall be in substantially the form of Exhibit A hereto, the provisions of which
are incorporated herein and shall be signed by, or bear the facsimile signature
of, the Chairman of the Board or President and Treasurer, Secretary or Assistant
Secretary of the Company and shall bear a facsimile of the Company’s seal. In
the event the person whose facsimile signature has been placed upon any Warrant
shall have ceased to serve in the capacity in which such person signed the
Warrant before such Warrant is issued, it may be issued with the same effect as
if he or she had not ceased to be such at the date of issuance.

    

    2.2.         Effect of
Countersignature.  Unless and until countersigned by the
Warrant Agent pursuant to this Agreement, a Warrant shall be invalid and of no
effect and may not be exercised by the holder thereof.

    

    2.3.         Registration.

    

    2.3.1.       Warrant
Register.  The Warrant Agent shall maintain books (“Warrant
Register”), for the registration of original issuance and the registration of
transfer of the Warrants.  Upon the initial issuance of the Warrants,
the Warrant Agent shall issue and register the Warrants in the names of the
respective holders thereof in such denominations and otherwise in accordance
with instructions delivered to the Warrant Agent by the
Company.

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    

    2.3.2.        Registered
Holder.  Prior to due presentment for registration of transfer
of any Warrant, the Company and the Warrant Agent may deem and treat the person
in whose name such Warrant shall be registered upon the Warrant Register
(“registered holder”) as the absolute owner of such Warrant and of each Warrant
represented thereby (notwithstanding any notation of ownership or other writing
on the Warrant Certificate made by anyone other than the Company or the Warrant
Agent), for the purpose of any exercise thereof, and for all other purposes, and
neither the Company nor the Warrant Agent shall be affected by any notice to the
contrary.

    

    2.4.         Detachability of
Warrants.  The securities comprising the Units will begin to
trade separately on the date that is the fifth business day following the
45th
calendar day following the date of the prospectus pursuant to which the Units
are sold (the “Detachment Date”), or earlier with the consent of Morgan Joseph
& Co. Inc., the representative of the underwriters (“Representative” or
“MJ”) but in no event before: (i) the expiration of the over-allotment option
(the “Over-allotment Option”) granted to MJ, (ii) its exercise in full, or (iii)
or MJ’s notice to the Company of its intention not to exercise all or any
remaining portion of the Over-allotment Option, provided that in no event will
separate trading of the securities comprising the Units commence until (x) the
Company files with the SEC a Current Report on Form 8-K, which includes an
audited balance sheet reflecting the receipt by the Company of the gross
proceeds of the sale of the Private Warrants and the Public Offering, including
the proceeds received by the Company from the exercise of the Over-allotment
Option, if the Over-allotment Option is exercised prior to the filing of the
Form 8-K and (y) the Company issues a press release and files with the SEC a
Current Report on Form 8-K announcing when such separate trading will
begin.

     

    2.5         Warrant
Attributes.

    

    2.5.1           Insider
Warrants.  The Insider Warrants will be issued in the same form
as the Public Warrants but they (i) will not be transferable or salable until 30
days after the Company completes a business transaction, (ii) will be
exercisable on a cashless basis so long as they are held by the Insiders or
their affiliates, (iii) will not be redeemable by the Company so long as they
are held by the Insiders or their affiliates and (iv) may be exercised for
unregistered shares if a registration statement relating to the shares of Common
Stock issuable upon exercise of the Warrants is not effective and
current.

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    

    3.           Terms and Exercise of
Warrants

    

    3.1.         Warrant
Price.  Each Warrant shall, when countersigned by the Warrant
Agent, entitle the registered holder thereof, subject to the provisions of such
Warrant and of this Warrant Agreement, to purchase from the Company the number
of shares of Common Stock stated therein, at the price of $11.50 per whole
share, subject to the adjustments provided in Section 4 hereof and in the last
sentence of this Section 3.1.  The term “Warrant Price” as used in
this Warrant Agreement refers to the price per share at which shares of Common
Stock may be purchased at the time a Warrant is exercised.  The
Company in its sole discretion may lower the Warrant Price at any time prior to
the Expiration Date for a period of not less than twenty business days, provided
that any such reduction shall be identical among all of the
Warrants.

    

    3.2.         Duration of
Warrants.  A Warrant may be exercised only during the period
commencing on the later of: (i) 30 days following the consummation by the
Company of a merger, capital stock exchange, asset acquisition, stock purchase,
reorganization or other similar business transaction with one or more operating
businesses (as described more fully in the Registration Statement, “Business Transaction”), or
(ii) [            ],
2010 (one year from the effective date of the Registration Statement), and
terminating at 5:00 p.m., New York City time on the earlier to occur of (x) five
years from the effective date of the Business Transaction; (ii) upon the
liquidation of the Company ; or (iii) the Redemption Date as provided in Section
6.2 of this Agreement (“Expiration Date”).  Except with respect to the
right to receive the Redemption Price (as set forth in Section 6 hereunder),
each Warrant not exercised on or before the Expiration Date shall become void,
and all rights thereunder and all rights in respect thereof under this Agreement
shall cease at the close of business on the Expiration Date.  The
Company in its sole discretion may extend the duration of the Warrants by
delaying the Expiration Date; provided, however, the Company will provide notice
to registered holders of the Warrants of such extension of not less than 20 days
and, further provided that any such extension shall be identical in duration
among all of the Warrants.

    

    3.3.         Exercise of
Warrants.

    

    3.3.1.         Payment.  Subject
to the provisions of the Warrant and this Warrant Agreement,  a
Warrant, when countersigned by the Warrant Agent, may be exercised by the
registered holder thereof by surrendering it, at the office of the Warrant
Agent, or at the office of its successor as Warrant Agent, in the Borough of
Manhattan, City and State of New York, with the subscription form, as set forth
in the Warrant, duly executed, and by paying in full the Warrant Price for each
full share of Common Stock as to which the Warrant is exercised and any and all
applicable taxes due in connection with the exercise of the Warrant, the
exchange of the Warrant for the shares of Common Stock and the issuance of such
Common Stock, as follows:

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    

    (a)           in
lawful money of the United States, in cash, good certified check or good bank
draft payable to the order of the Company;

    

    (b)           in
the event of redemption pursuant to Section 6 hereof in which the Company’s
management has elected to force all holders of Warrants to exercise such
Warrants on a “cashless basis,” by surrendering the Warrants for that number of
shares of Common Stock equal to the quotient obtained by dividing (x) the
product of the number of shares Common Stock underlying the Warrants, multiplied
by the difference between the Warrant Price and the “Fair Market Value” (defined
below) by (y) the Fair Market Value. Solely for purposes of this Section
3.3.1(b), the “Fair Market Value” shall mean the average reported last sale
price of the Common Stock for the 10 trading days ending on the third trading
day prior to the date on which the notice of redemption is sent to holders of
Warrant pursuant to Section 6 hereof; or

    

    (c)           with
respect to any Insider Warrants, so long as such Insider Warrants are held by
the Insiders or their affiliates, by surrendering the Warrants for that number
of shares of Common Stock equal to the quotient obtained by dividing (x) the
product of the number of shares of Common Stock underlying the Warrants,
multiplied by the difference between the Warrant Price and the “Fair Market
Value” (defined below) by (y) the Fair Market Value. Solely for purposes of this
Section 3.3.1(c), the “Fair Market Value” shall mean the average reported last
sale price of the Common Stock for the 5 trading days ending on the trading day
prior to the date of exercise.

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    3.3.2.         Issuance of
Certificates.  As soon as practicable after the exercise of any
Warrant and the clearance of the funds in payment of the Warrant Price (if cash
is paid), the Company shall issue to the registered holder of such Warrant a
certificate or certificates for the number of full shares of shares of Common
Stock to which he, she or it is entitled, registered in such name or names as
may be directed by him, her or it, and if such Warrant shall not have been
exercised in full, a new countersigned Warrant for the number of shares as to
which such Warrant shall not have been exercised.  Notwithstanding the
foregoing, the Company shall not be obligated to deliver any securities pursuant
to the exercise of a Warrant and shall have no obligation to settle such Warrant
exercise unless:  (i) a registration statement under the Act with
respect to the shares of Common Stock is effective, subject to the Company’s
satisfying its obligations under Section 7.4 or (ii) in the opinion of counsel
to the Company, the exercise of the Warrants is exempt from the registration
requirements of the Act and such securities are qualified for sale or exempt
from qualification under applicable securities laws of the states or other
jurisdictions in which the registered holders reside. In the event that a
registration statement with respect to the shares of Common Stock underlying a
Warrant is not effective under the Act, the holder of such Warrant shall not be
entitled to exercise such Warrant and such Warrant may have no value and expire
worthless. In no event will the Company be required to net cash settle the
Warrant exercise.  Warrants may not be exercised by, or securities
issued to, any registered holder in any state in which such exercise would be
unlawful. In the event that a registration statement is not effective for the
exercised Public Warrants the purchaser of a Unit containing such Warrants will
have paid the full purchase price for the Unit solely for the shares of Common
Stock included in such Unit.

    

    3.3.3.         Valid
Issuance.  All shares of Common Stock issued upon the proper
exercise of a Warrant in conformity with this Agreement shall be validly issued,
fully paid and nonassessable.

    

    3.3.4.         Date of
Issuance.  Each person in whose name any such certificate for
Common Stock is issued shall for all purposes be deemed to have become the
holder of record of such shares on the date on which the Warrant was surrendered
and payment of the Warrant Price was made, irrespective of the date of delivery
of such certificate, except that, if the date of such surrender and payment is a
date when the share 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 share transfer books are
open.

    

    4.           Adjustments.

    

    4.1.         Stock Dividends - Split
Ups.  If after the date hereof, and subject to the provisions
of Section 4.6 below, the number of outstanding shares of Common Stock is
increased by a stock dividend payable in shares of Common Stock, or by a split
up of shares of Common Stock, or other similar event, then, on the effective
date of such stock dividend, split up or similar event, the number of shares of
Common Stock issuable on exercise of each Warrant shall be increased in
proportion to such increase in outstanding shares of Common
Stock.

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    

    4.2.         Aggregation of
Shares.  If after the date hereof, and subject to the
provisions of Section 4.6, the number of outstanding shares of Common Stock is
decreased by a consolidation, combination, reverse stock split or
reclassification of shares of Common Stock or other similar event, then, on the
effective date of such consolidation, combination, reverse stock split,
reclassification or similar event, the number of shares of Common Stock issuable
on exercise of each Warrant shall be decreased in proportion to such decrease in
outstanding shares of Common Stock.

    

    4.3         Adjustments in Exercise
Price.  Whenever the number of shares of Common Stock
purchasable upon the exercise of the Warrants is adjusted, as provided in
Section 4.1 and 4.2 above, the Warrant Price shall be adjusted (to the nearest
cent) by multiplying such Warrant Price immediately prior to such adjustment by
a fraction (x) the numerator of which shall be the number of shares of Common
Stock purchasable upon the exercise of the Warrants immediately prior to such
adjustment, and (y) the denominator of which shall be the number of shares of
Common Stock so purchasable immediately thereafter.

    

    4.4.         Replacement of Securities
upon Reorganization, etc.  In case of any reclassification or
reorganization of the outstanding shares of Common Stock (other than a change
covered by Section 4.1 or 4.2 hereof or that solely affects the par value of
such shares of Common Stock), or in the case of any merger or consolidation of
the Company with or into another corporation (other than a consolidation or
merger in which the Company is the continuing corporation and that does not
result in any reclassification or reorganization of the outstanding shares of
Common Stock), or in the case of any sale or conveyance to another corporation
or entity of the assets or other property of the Company as an entirety or
substantially as an entirety in connection with which the Company is dissolved,
the Warrant holders shall thereafter have the right to purchase and receive,
upon the basis and upon the terms and conditions specified in the Warrants and
in lieu of the shares of Common Stock of the Company immediately theretofore
purchasable and receivable upon the exercise of the rights represented thereby,
the kind and amount of shares of stock or other securities or property
(including cash) receivable upon such reclassification, reorganization, merger
or consolidation, or upon a dissolution following any such sale or transfer,
that the Warrant holder would have received if such Warrant holder had exercised
his, her or its Warrant(s) immediately prior to such event; and if any
reclassification also results in a change in shares of Common Stock covered by
Section 4.1 or 4.2, then such adjustment shall be made pursuant to Sections 4.1,
4.2, 4.3 and this Section 4.4.  The provisions of this Section 4.4
shall similarly apply to successive reclassifications, reorganizations, mergers
or consolidations, sales or other transfers.

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    

    4.5.         Notices of Changes in
Warrant.  Upon every adjustment of the Warrant Price or the
number of shares issuable upon exercise of a Warrant, the Company shall give
written notice thereof to the Warrant Agent, which notice shall state the
Warrant Price resulting from such adjustment and the increase or decrease, if
any, in the number of shares purchasable at such price upon the exercise of a
Warrant, setting forth in reasonable detail the method of calculation and the
facts upon which such calculation is based.  Upon the occurrence of
any event specified in Sections 4.1, 4.2, 4.3 or 4.4, then, in any such event,
the Company shall give written notice to each Warrant holder, at the last
address set forth for such holder in the warrant register, of the record date or
the effective date of the event.  Failure to give such notice, or any
defect therein, shall not affect the legality or validity of such
event.

    

    4.6.         No Fractional
Shares.  Notwithstanding any provision contained in this
Warrant Agreement to the contrary, the Company shall not issue fractional shares
upon exercise of Warrants.  If, by reason of any adjustment made
pursuant to this Section 4, the holder of any Warrant would be entitled, upon
the exercise of such Warrant, to receive a fractional interest in a share, the
Company shall, upon such exercise, round up to the nearest whole number, the
number of the shares of Common Stock to be issued to the Warrant
holder.

    

    4.7.         Form of
Warrant.  The form of Warrant need not be changed because of
any adjustment pursuant to this Section 4, and Warrants issued after such
adjustment may state the same Warrant Price and the same number of shares as is
stated in the Warrants initially issued pursuant to this
Agreement.  However, the Company may at any time in its sole
discretion make any change in the form of Warrant that the Company may deem
appropriate and that does not affect the substance thereof, and any Warrant
thereafter issued or countersigned, whether in exchange or substitution for an
outstanding Warrant or otherwise, may be in the form as so changed.

    

    5.           Transfer and Exchange of
Warrants.

    

    5.1.         Registration of
Transfer.  The Warrant Agent shall register the transfer, from
time to time, of any outstanding Warrant upon the Warrant Register, upon
surrender of such Warrant for transfer, properly endorsed with signatures
properly guaranteed and accompanied by appropriate instructions for
transfer.  Upon any such transfer, a new Warrant representing an equal
aggregate number of Warrants shall be issued and the old Warrant shall be
cancelled by the Warrant Agent.  The Warrants so cancelled shall be
delivered by the Warrant Agent to the Company from time to time upon
request.

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    

    5.2.         Procedure for Surrender of
Warrants.  Warrants may be surrendered to the Warrant Agent,
together with a written request for exchange or transfer, and thereupon the
Warrant Agent shall issue in exchange therefor one or more new Warrants as
requested by the registered holder of the Warrants so surrendered, representing
an equal aggregate number of Warrants; provided, however, that in the event that
a Warrant surrendered for transfer bears a restrictive legend, the Warrant Agent
shall not cancel such Warrant and issue new Warrants in exchange therefor until
the Warrant Agent has received an opinion of counsel for the Company stating
that such transfer may be made and indicating whether the new Warrants must also
bear a restrictive legend.

    

    5.3.         Fractional
Warrants.  The Warrant Agent shall not be required to effect
any registration of transfer or exchange which will result in the issuance of a
warrant certificate for a fraction of a warrant.

    

    5.4.         Service
Charges.  No service charge shall be made for any exchange or
registration of transfer of Warrants.

    

    5.5.         Warrant Execution and
Countersignature.  The Warrant Agent is hereby authorized to
countersign and to deliver, in accordance with the terms of this Agreement, the
Warrants required to be issued pursuant to the provisions of this Section 5, and
the Company, whenever required by the Warrant Agent, will supply the Warrant
Agent with Warrants duly executed on behalf of the Company for such
purpose.

    

    5.6         Transfer of
Warrants.  Prior to the Detachment Date, the Public Warrants
may be transferred or exchanged only together with the Unit in which such
Warrant is included, and only for the purpose of effecting, or in conjunction
with, a transfer or exchange of such Unit. Furthermore, each transfer of a Unit
on the register relating to such Units shall operate also to transfer the
Warrants included in such Unit. From and after the Detachment Date this Section
5.6 will have no further force and effect.

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

     

    6.           Redemption.

    

    6.1.           Redemption.  Subject
to Sections 6.4 and 6.5 hereof, not less than all of the outstanding Warrants
may be redeemed, at the option of the Company, at any time while they are
exercisable and prior to their expiration, at the office of the Warrant Agent,
upon the notice referred to in Section 6.2, at the price of $.01 per Warrant
(“Redemption Price”), provided that the last sales price of the Common Stock has
been at least $17.50 per share (subject to adjustment in accordance with Section
4 hereof), on each of twenty (20) trading days within any thirty (30) trading
day period ending on the third business day prior to the date on which notice of
redemption is given.  The provisions of this Section 6.1 may not be
modified, amended or deleted without the prior written consent of
MJ.

    

    6.2.           Date Fixed for, and Notice
of, Redemption.  In the event the Company shall elect to redeem
all of the Warrants, the Company shall fix a date for the redemption (the
“Redemption Date”).  Notice of redemption shall be mailed by first
class mail, postage prepaid, by the Company not less than 30 days prior to the
Redemption Date to the registered holders of the Warrants to be redeemed at
their last addresses as they shall appear on the registration
books.  Any notice mailed in the manner herein provided shall be
conclusively presumed to have been duly given whether or not the registered
holder received such notice.

    

    6.3.           Exercise After Notice of
Redemption.  The Warrants may be exercised, for cash (or on a
“cashless basis” in accordance with Section 3 of this Agreement) at any time
after notice of redemption shall have been given by the Company pursuant to
Section 6.2 hereof and prior to the Redemption Date.  In the event the
Company determines to require all holders of Warrants to exercise their Warrants
on a “cashless basis” pursuant to Section 3, the notice of redemption will
contain the information necessary to calculate the number of shares Common Stock
to be received upon exercise of the Warrants, including the “Fair Market Value”
in such case. On and after the Redemption Date, the record holder of the
Warrants shall have no further rights except to receive, upon surrender of the
Warrants, the Redemption Price.

    

    6.4           Exclusion of Insider
Warrants.  The Company understands that the redemption rights
provided for by this Section 6 do not apply to the Insider Warrants if at the
time of redemption such warrants continue to be held by the initial purchasers
thereof or their permitted assigns.  However, once such Insider
Warrants are transferred other than to any permitted assign, the Company may
redeem the Insider Warrants, provided that the criteria for redemption are met,
including the opportunity of the Warrant holder to exercise prior to redemption
pursuant to Section 6.3.

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

     

    7.           Other Provisions Relating to
Rights of Holders of Warrants.

    

    7.1.           No Rights as
Stockholder.  A Warrant does not entitle the registered holder
thereof to any of the rights of a stockholder of the Company, including, without
limitation, the right to receive dividends, or other distributions, exercise any
preemptive rights to vote or to consent or to receive notice as stockholders in
respect of the meetings of stockholders or the election of directors of the
Company or any other matter.

    

    7.2.           Lost, Stolen, Mutilated, or
Destroyed Warrants.  If any Warrant is lost, stolen, mutilated,
or destroyed, the Company and the Warrant Agent may on such terms as to
indemnity or otherwise as they may in their discretion impose (which shall, in
the case of a mutilated Warrant, include the surrender thereof), issue a new
Warrant of like denomination, tenor, and date as the Warrant so lost, stolen,
mutilated, or destroyed.  Any such new Warrant shall constitute a
substitute contractual obligation of the Company, whether or not the allegedly
lost, stolen, mutilated, or destroyed Warrant shall be at any time enforceable
by anyone.

    

    7.3.           Reservation of Common
Stock.  The Company shall at all times reserve and keep
available a number of its authorized but unissued shares of Common Stock that
will be sufficient to permit the exercise in full of all outstanding Warrants
issued pursuant to this Agreement.

    

    7.4.           Registration of Common
Stock.  The Company agrees that prior to the commencement of
the Exercise Period, it shall use its best efforts to file with the Securities
and Exchange Commission a post-effective amendment to the Registration
Statement, or a new registration statement, for the registration, under the Act,
of the shares of Common Stock issuable upon exercise of the Warrants, and it
shall use its best efforts to take such action as is necessary to qualify for
sale, in those states in which the Warrants were initially offered by the
Company, the shares of Common Stock issuable upon exercise of the
Warrants.  In either case, the Company will use its best efforts to
cause the same to become effective and to maintain the effectiveness of such
registration statement until the expiration of the Warrants in accordance with
the provisions of this Agreement.  In addition, the Company agrees to
use its best efforts to register such securities under the blue sky laws of the
states of residence of the exercising warrant holders to the extent an exemption
is not available , subject to the proviso above.  The provisions of
this Section 7.4 may not be modified, amended or deleted without the prior
written consent of MJ.

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    

    8.           Concerning the Warrant Agent
and Other Matters.

    

    8.1.         Payment of
Taxes.  The Company will from time to time promptly pay all
taxes and charges that may be imposed upon the Company or the Warrant Agent in
respect of the issuance or delivery of shares of Common Stock upon the exercise
of Warrants, but the Company shall not be obligated to pay any transfer taxes in
respect of the Warrants or such shares.

    

    8.2.         Resignation, Consolidation,
or Merger of Warrant Agent.

    

    8.2.1.         Appointment of Successor
Warrant Agent.  The Warrant Agent, or any successor to it
hereafter appointed, may resign its duties and be discharged from all further
duties and liabilities hereunder after giving sixty (60) days’ notice in writing
to the Company.  If the office of the Warrant Agent becomes vacant by
resignation or incapacity to act or otherwise, the Company shall appoint in
writing a successor Warrant Agent in place of the Warrant Agent.  If
the Company shall fail to make such appointment within a period of 30 days after
it has been notified in writing of such resignation or incapacity by the Warrant
Agent or by the holder of the Warrant (who shall, with such notice, submit his
Warrant for inspection by the Company), then the holder of any Warrant may apply
to the Supreme Court of the State of New York for the County of New York for the
appointment of a successor Warrant Agent at the Company’s cost.  Any
successor Warrant Agent, whether appointed by the Company or by such court,
shall be a corporation organized and existing under the laws of the State of New
York, in good standing and having its principal office in the Borough of
Manhattan, City and State of New York, and authorized under such laws to
exercise corporate trust powers and subject to supervision or examination by
federal or state authority.  After appointment, any successor Warrant
Agent shall be vested with all the authority, powers, rights, immunities,
duties, and obligations of its predecessor Warrant Agent with like effect as if
originally named as Warrant Agent hereunder, without any further act or deed;
but if for any reason it becomes necessary or appropriate, the predecessor
Warrant Agent shall execute and deliver, at the expense of the Company, an
instrument transferring to such successor Warrant Agent all the authority,
powers, and rights of such predecessor Warrant Agent hereunder; and upon request
of any successor Warrant Agent the Company shall make, execute, acknowledge, and
deliver any and all instruments in writing for more fully and effectually
vesting in and confirming to such successor Warrant Agent all such authority,
powers, rights, immunities, duties, and obligations.

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

    

    8.2.2.         Notice of Successor Warrant
Agent.  In the event a successor Warrant Agent shall be
appointed, the Company shall give notice thereof to the predecessor Warrant
Agent and the transfer agent for the Common Stock not later than the effective
date of any such appointment.

    

    8.2.3.         Merger or Consolidation of
Warrant Agent.  Any corporation into which the Warrant Agent
may be merged or with which it may be consolidated or any corporation resulting
from any merger or consolidation to which the Warrant Agent shall be a party
shall be the successor Warrant Agent under this Agreement without any further
act.

    

    8.3.         Fees and Expenses of Warrant
Agent.

    

    8.3.1.         Remuneration.  The
Company agrees to pay the Warrant Agent reasonable remuneration for its services
as such Warrant Agent hereunder and will reimburse the Warrant Agent upon demand
for all expenditures that the Warrant Agent may reasonably incur in the
execution of its duties hereunder.

    

    8.3.2.         Further
Assurances.  The Company agrees to perform, execute,
acknowledge, and deliver or cause to be performed, executed, acknowledged, and
delivered all such further and other acts, instruments, and assurances as may
reasonably be required by the Warrant Agent for the carrying out or performing
of the provisions of this Agreement.

    

    8.4.         Liability of Warrant
Agent.

    

    8.4.1.         Reliance on Company
Statement.  Whenever in the performance of its duties under
this Warrant Agreement, the Warrant Agent shall deem it necessary or desirable
that any fact or matter be proved or established by the Company prior to taking
or suffering any action hereunder, such fact or matter (unless other evidence in
respect thereof be herein specifically prescribed) may be deemed to be
conclusively proved and established by a statement signed by the President or
Chairman of the Board of the Company and delivered to the Warrant
Agent.  The Warrant Agent may rely upon such statement for any action
taken or suffered in good faith by it pursuant to the provisions of this
Agreement.

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

    

    8.4.2.         Indemnity.  The
Warrant Agent shall be liable hereunder only for its own gross negligence,
willful misconduct or bad faith.  The Company agrees to indemnify the
Warrant Agent and save it harmless against any and all liabilities, including
judgments, costs and reasonable counsel fees, for anything done or omitted by
the Warrant Agent in the execution of this Agreement except as a result of the
Warrant Agent’s gross negligence, willful misconduct, or bad faith.

    

    8.4.3.         Exclusions.  The
Warrant Agent shall have no responsibility with respect to the validity of this
Agreement or with respect to the validity or execution of any Warrant (except
its countersignature thereof); nor shall it be responsible for any breach by the
Company of any covenant or condition contained in this Agreement or in any
Warrant; nor shall it be responsible to make any adjustments required under the
provisions of Section 4 hereof or responsible for the manner, method, or amount
of any such adjustment or the ascertaining of the existence of facts that would
require any such adjustment; nor shall it by any act hereunder be deemed to make
any representation or warranty as to the authorization or reservation of any
shares of Common Stock to be issued pursuant to this Agreement or any Warrant or
as to whether any shares of Common Stock will when issued be valid and fully
paid and nonassessable.

    

    8.5.         Acceptance of
Agency.  The Warrant Agent hereby accepts the agency
established by this Agreement and agrees to perform the same upon the terms and
conditions herein set forth and among other things, shall account promptly to
the Company with respect to Warrants exercised and concurrently account for, and
pay to the Company, all moneys received by the Warrant Agent for the purchase of
shares of Common Stock through the exercise of Warrants.

    

    8.6         Waiver.  The
Warrant Agent hereby waives any and all right, title, interest or claim of any
kind (“Claim”) in or to
any distribution of the Trust Account (as defined in that certain Investment
Management Trust Agreement, dated as of the date hereof, by and between the
Company and the Warrant Agent as trustee thereunder) and hereby agrees not to
seek recourse, reimbursement, payment or satisfaction for any Claim against the
Trust Account for any reason whatsoever.

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

    

    9.           Miscellaneous
Provisions.

    

    9.1.         Successors.  All
the covenants and provisions of this Agreement by or for the benefit of the
Company or the Warrant Agent shall bind and inure to the benefit of their
respective successors and assigns.

    

    9.2.         Notices.  Any
notice, statement or demand authorized by this Warrant Agreement to be given or
made by the Warrant Agent or by the holder of any Warrant to or on the Company
shall be sufficiently given when so delivered if by hand or overnight delivery
or if sent by certified mail or private courier service within five days after
deposit of such notice, postage prepaid, addressed (until another address is
filed in writing by the Company with the Warrant Agent), as
follows:

    

    57th Street
General Acquisition Corp.

    590
Madison Avenue, 35th Floor

    New York,
New York 10022

    Attn:  Chief
Executive Officer

    

    Any
notice, statement or demand authorized by this Agreement to be given or made by
the holder of any Warrant or by the Company to or on the Warrant Agent shall be
sufficiently given when so delivered if by hand or overnight delivery or if sent
by certified mail or private courier service within five days after deposit of
such notice, postage prepaid, addressed (until another address is filed in
writing by the Warrant Agent with the Company), as follows:

    

    Continental
Stock Transfer & Trust Company

    17
Battery Place

    New York,
New York 10004

    Attn:  Compliance
Department

    

    with a
copy in each case to:

    

    Ellenoff
Grossman & Schole LLP

    150 East
42nd
Street

    New York,
NY 10017

    Attn:  Douglas
S. Ellenoff, Esq.

    

    and

    

    Morgan
Joseph and Co., Inc.

    600 Fifth
Avenue, 19th Floor

    New York,
NY 10020-2302

    Attn:  _____________________

    
      
         

      

      
        15

        
          

        

      

      
         

      

    

    and

    

    McDermott
Will & Emery LLP

    340
Madison Avenue

    New York,
NY 10173

    Attn:  Joel
L. Rubenstein, Esq.

    

    9.3.         Applicable
Law.  The validity, interpretation, and performance of this
Agreement and of the Warrants shall be governed in all respects by the laws of
the State of New York, without giving effect to conflicts of law principles that
would result in the application of the substantive laws of another
jurisdiction.  The Company hereby agrees that any action, proceeding
or claim against it arising out of or relating in any way to this Agreement
shall be brought and enforced in the courts of the State of New York or the
United States District Court for the Southern District of New York, and
irrevocably submits to such jurisdiction, which jurisdiction shall be
exclusive.  The Company hereby waives any objection to such exclusive
jurisdiction and that such courts represent an inconvenience
forum.  Any such process or summons to be served upon the Company may
be served by transmitting a copy thereof by registered or certified mail, return
receipt requested, postage prepaid, addressed to it at the address set forth in
Section 9.2 hereof.  Such mailing shall be deemed personal service and
shall be legal and binding upon the Company in any action, proceeding or
claim.

    

    9.4.         Persons Having Rights under
this Agreement.  Nothing in this Agreement expressed and
nothing that may be implied from any of the provisions hereof is intended, or
shall be construed, to confer upon, or give to, any person or corporation other
than the parties hereto and the registered holders of the Warrants and, for the
purposes of Sections 6.1, 7.4 and 9.2 hereof, MJ, any right, remedy, or claim
under or by reason of this Warrant Agreement or of any covenant, condition,
stipulation, promise, or agreement hereof.  MJ shall be deemed to be a
third-party beneficiary of this Agreement with respect to Sections 6.1, 7.4 and
9.2 hereof.  All covenants, conditions, stipulations, promises, and
agreements contained in this Warrant Agreement shall be for the sole and
exclusive benefit of the parties hereto (and MJ with respect to the Sections
6.1, 7.4 and 9.2 hereof) and their successors and assigns and of the registered
holders of the Warrants.

    

    9.5.         Examination of the Warrant
Agreement.  A copy of this Agreement shall be available at all
reasonable times at the office of the Warrant Agent in the Borough of Manhattan,
City and State of New York, for inspection by the registered holder of any
Warrant.  The Warrant Agent may require any such holder to submit his
Warrant for inspection by it.

    
      
         

      

      
        16

        
          

        

      

      
         

      

    

    

    9.6.         Counterparts.  This
Agreement may be executed in any number of original or facsimile 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.

    

    9.7.         Effect of
Headings.  The Section headings herein are for convenience only
and are not part of this Warrant Agreement and shall not affect the
interpretation thereof.

    

    9.8         Amendments.  This
Agreement may be amended by the parties hereto without the consent of any
registered holder for the purpose of curing any ambiguity, or of curing,
correcting or supplementing any defective provision contained herein or adding
or changing any other provisions with respect to matters or questions arising
under this Agreement as the parties may deem necessary or desirable and that the
parties deem shall not adversely affect the interest of the registered
holders.  All other modifications or amendments, including any
amendment to increase the Warrant Price or shorten the Exercise Period, shall
require the written consent of the registered holders of a majority of the then
outstanding Warrants.  Notwithstanding the foregoing, the Company may
lower the Warrant Price or extend the duration of the Exercise Period pursuant
to Sections 3.1 and 3.2, respectively, without the consent of the registered
holders.

    

    9.9         Severability.  This
Warrant Agreement shall be deemed severable, and the invalidity or
unenforceability of any term or provision hereof shall not affect the validity
or enforceability of this Warrant Agreement or of any other term or provision
hereof. Furthermore, in lieu of any such invalid or unenforceable term or
provision, the parties hereto intend that there shall be added as a part of this
Warrant Agreement a provision as similar in terms to such invalid or
unenforceable provision as may be possible and be valid and
enforceable

    
      
         

      

      
        17

        
          

        

      

      
         

      

    

    IN WITNESS WHEREOF, this Agreement has
been duly executed by the parties hereto as of the day and year first above
written.

     

    
      
        
          
            
              	 
      	
                      57TH
      STREET GENERAL ACQUISITION CORP.

                    
	 
      	 
      	 
      
	 
      	
                      By:

                    	 
      
	 
      	
                      Name:

                    	 
      
	 
      	 
      	
                      Title:

                    
	 
      	 
      	 
      
	 
      	
                      CONTINENTAL
      STOCK TRANSFER

                    
	 
      	
                      &
      TRUST COMPANY

                    
	 
      	 
      	 
      
	 
      	
                      By:

                    	 
      
	 
      	
                      Name:

                    	 
      
	 
      	 
      	
                      Title:

                    

            

          

        

      

    

     

    
      
         

      

      
        18

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