Document:

Exhibit 10.113 - Amended and Restated Common Stock Purchase Warrant

	

W-W2 

1,615,385 Warrant Shares 

THIS WARRANT AND ANY SECURITIES
ACQUIRED UPON THE EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OR FOREIGN JURISDICTION. NEITHER THIS WARRANT, SUCH SECURITIES NOR ANY
INTEREST THEREIN MAY BE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER SUCH ACT AND APPLICABLE STATE AND FOREIGN SECURITIES LAWS OR PURSUANT TO AN
APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT AND SUCH LAWS. 

     

EOS INTERNATIONAL, INC. 

AMENDED AND RESTATED
COMMON STOCK PURCHASE WARRANT 

     

        This
certifies that, for good and valuable consideration, EOS INTERNATIONAL, INC., a Delaware
corporation (the “Company”), grants to DL HOLDINGS I, LLC a Delaware limited
liability company (the “Warrantholder”), the right to subscribe for and purchase
from the Company, during the Exercise Period (as hereinafter defined), 1,615,385 validly
issued, fully paid and nonassessable shares, par value $0.01, of Common Stock of the
Company (the “Warrant Shares”), at the exercise price per share of $0.25 per
share (the “Exercise Price”), all subject to the terms, conditions and
adjustments herein set forth. Capitalized terms used herein shall have the meanings
ascribed to such terms in Section 9 below. 

         1.       
          Warrant.   This Amended and Restated Common Stock Purchase Warrant (this
          “Warrant”) is issued by the Company contemporaneously with the
          Company’s issuance of a warrant for 1,384,615 Warrant Shares (the
          “Other Warrant”) to Weichert Enterprise LLC. (the “Other
          Warrantholder”) and is subject to the terms of the Amended and Restated
          Registration Rights Agreement, dated as of January 14, 2003 (the
          “Registration Rights Agreement”), among the Company, the Warrantholder
          and the Other Warrantholder. 

         2.       
          Exercise of Warrant; Payment of Taxes. 

       2.1    
 Exercise  of Warrant.   Subject to the terms and  conditions  set forth  herein,
this Warrant may be exercised at any time, in whole or in part, by the Warrantholder
during the Exercise Period by:  

       
       (a)       the
surrender of this Warrant to the Company, with a duly executed Exercise Form, and 

	

       
       (b)       
subject to Section 2.2 below,  the delivery of payment of the  Company,  for the
account of the Company, by (i) cash,  wire transfer,  certified or official
bank check or any other means approved by the Company, of the aggregate Exercise
Price in lawful money of the United States of America or (ii) the surrender
of  Series D  Preferred Stock of the Company (the  “Series D Preferred
Stock”)  valued at the Redemption Price as determined by the Certificate of
Designations  of  the   Series D   Preferred  Stock  of  the  Company  (the
“Certificate of  Designations”) on the date surrendered to the Company
or (iii) a combination of (i) and (ii); provided, however, that the Company
reserves  the  right  to  refuse  to  accept  Series D  Preferred  Stock as
consideration for the exercise of the Warrant if it would violate law or violate
the provisions of any agreement to which the Company is a party. 

The Company agrees that the Warrant
Shares shall be deemed to be issued to the Warrantholder as the record holder of such
Warrant Shares as of the close of business on the date on which this Warrant shall have
been surrendered and payment made for the Warrant Shares as aforesaid. 

       2.2
    Conversion Right. 

       
            (a)       
In lieu of the payment of the aggregate Exercise Price, the Warrantholder  shall
have the right (but not the obligation),  to require the Company to convert this
Warrant, in whole or in part, into shares of Common Stock (the  “Conversion
Right”)  as  provided  for  in  this  Section  2.2.  Upon  exercise  of the
Conversion  Right,  the  Company  shall  deliver to the  Warrantholder  (without
payment by the  Warrantholder  of any of the Exercise  Price) in accordance with
Section  2.1(b)  that  number of shares of Common  Stock  equal to the  quotient
obtained by dividing (i) the value of the Warrant or portion thereof at the time
the  Conversion  Right is exercised  (determined  by  subtracting  the aggregate
Exercise  Price at the time of the  exercise  of the  Conversion  Right from the
aggregate  Current  Market  Price for the shares of Common Stock  issuable  upon
exercise of the Warrant at the time of the exercise of the Conversion  Right) by
(ii) the Current  Market  Price of one share of Common  Stock at the time of the
exercise of the Conversion Right. 

       
            (b)       
The Conversion  Right may be exercised by the  Warrantholder on any Business Day
prior to the end of the  Exercise  Period by  surrender  of this  Warrant to the
Company,  with a  duly  executed  Exercise  Form  with  the  conversion  section
completed,  exercising the  Conversion  Right and specifying the total number of
shares of Common Stock that the  Warrantholder  will be issued  pursuant to such
conversion. 

       2.3
    Warrant Shares  Certificate.   A stock  certificate or certificates  for the
Warrant  Shares  specified  in the  Exercise  Form  shall  be  delivered  to the
Warrantholder  within five (5) Business  Days after receipt of the Exercise Form
by the Company and, if the Conversion Right is not exercised, the payment by the
Warrantholder  of the aggregate  Exercise Price. If this Warrant shall have been
exercised only in part, the Company shall,  at the time of delivery of the stock
certificate  or  certificates,  deliver  to  the  Warrantholder  a  new  Warrant
evidencing the right to purchase the remaining Warrant Shares, which new Warrant
shall in all other respects be identical with this Warrant. 

       2.4
    Payment  of  Taxes.   The  Company  will  pay all  documentary  stamp  or  other
issuance taxes, if any, attributable to the issuance of Warrant Shares upon the exercise
of this Warrant; provided, however, that the Company shall not be required to pay
any tax or taxes which may be payable in respect of any transfer involved in the issue or
delivery of any Warrants or Warrant certificates or Warrant Shares in a name other than
that of the them Warrantholder as reflected upon the books of the Company.  

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       3.       Restrictions
on Transfer; Restrictive Legends.  

       
       3.1    This  Warrant and the Warrant  Shares may not be  offered,  sold,
 transferred, pledged or otherwise disposed of, in whole or in part, to any Person other
than in accordance with applicable federal and state securities laws.  

       
       3.2    Except as  otherwise  permitted  by this  Section 3, each  Warrant (and Warrant
issued in substitution for any Warrant pursuant to Section 6) shall be stamped or
otherwise imprinted with a legend in substantially the form as set forth on the cover of
this Warrant. Notwithstanding the foregoing, the Warrantholder may require the Company to
issue a Warrant or a certificate for Warrant Shares, in each case without a legend, if
either (i) such Warrant or such Warrant Shares, as the case may be, have been registered
for resale under the Securities Act, (ii) the Warrantholder has delivered to Company an
opinion of legal counsel (from a firm reasonably satisfactory to the Company) which
opinion shall be addressed to the Company and be reasonably satisfactory in form and
substance to the Company’s counsel, to the effect that such registration is not
required with respect to such Warrant or such Warrant Shares, as the case may be or (iii)
such Warrant or Warrant Shares may be sold pursuant to Rule 144 (or any successor
provision then in effect) under the Securities Act.  

4.       Reservation
     and  Registration  of  Shares.    The Company  covenants  and
agrees as follows: 

       
            (a)       
All Warrant Shares that are issued upon the exercise of this Warrant shall, upon
issuance,  be validly issued,  not subject to any preemptive rights, and be free
from all taxes, liens,  security interest,  charges, and other encumbrances with
respect to the  issuance  thereof,  other than taxes in respect of any  transfer
occurring contemporaneously with such issue. 

       
            (b)       
The Company  shall at all times have  authorized  and  reserved,  and shall keep
available  and free from  preemptive  rights,  a sufficient  number of shares of
Common  Stock to provide  for the  exercise  of the rights  represented  by this
Warrant. 

       
            (c)       
The Company  shall not, by  amendment of its  Certificate  of  Incorporation  or
through any reorganization, transfer of assets, spin-off, consolidation, merger,
dissolution,  issue or sale of securities or any other action or inaction,  seek
to avoid the observance or performance of any of the terms of this Warrant,  and
shall at all times in good faith assist in  performing  and giving effect to the
terms  hereof  and in the  taking of all such  actions  as may be  necessary  or
appropriate in order to protect the rights of the Warrantholder against dilution
or other impairment. 

       5.     
  Anti-dilution  Adjustment.    The Exercise  Price and the number of Warrant Shares to be
received  upon  exercise  of this  Warrant  shall be  subject to  adjustment  as
follows: 

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            5.1    Dividend, Subdivision,
Combination or  Reclassification  of Common Stock.   In the event that the Company
shall at any time or from time to time,  after the  issuance of this Warrant but
prior  to the  exercise  hereof,  (w) make a  dividend  or  distribution  on the
outstanding  shares of Common Stock payable in Capital Stock,  (x) subdivide the
outstanding  shares of Common Stock into a larger number of shares,  (y) combine
the  outstanding  shares of Common Stock into a smaller  number of shares or (z)
issue any shares of its Capital Stock in a reclassification  of the Common Stock
(other than any such event for which an  adjustment  is made pursuant to another
clause of this Section 5), then, and in each such case, (A) the aggregate number
of Warrant Shares for which this Warrant is exercisable (the “Warrant Share
Number”)  immediately  prior to such event shall be adjusted (and any other
appropriate  actions  shall be taken by the  Company) so that the  Warrantholder
shall be entitled to receive upon  exercise of this Warrant the number of shares
of Common Stock or other  securities  of the Company that it would have owned or
would  have been  entitled  to  receive  upon or by reason of any of the  events
described  above,  had this  Warrant  been  exercised  immediately  prior to the
occurrence of such event and (B) the Exercise Price payable upon the exercise of
this Warrant shall be adjusted by multiplying  such Exercise  Price  immediately
prior to such  adjustment  by a fraction,  the  numerator  of which shall be the
number of Warrant Shares issuable upon the exercise of this Warrant  immediately
prior to such  adjustment,  and the  denominator of which shall be the number of
Warrant Shares issuable immediately  thereafter.  An adjustment made pursuant to
this Section 5.1 shall  become  effective  retroactively  (x) in the case of any
such  dividend or  distribution,  to a date  immediately  following the close of
business on the record date for the determination of holders of shares of Common
Stock  entitled to receive such dividend or  distribution  or (y) in the case of
any such subdivision, combination or reclassification,  to the close of business
on the day upon which such corporate action becomes effective. 

       5.2    Issuance
of Common Stock or Common Stock  Equivalents  Below Exercise Price or the Fair Market
Value.  

       
            (a)       
Except in the circumstances contemplated by Section 5.1, if the Company shall at
any time from time to time,  after the issuance of this Warrant but prior to the
exercise   hereof,   issue  or  sell  (such   issuance  or  sale,   a  “New
Issuance”)  any shares of Common Stock or Common Stock  Equivalent  (which,
for  purposes   hereof,   shall  include  any  security  issued  as  part  of  a
“PIPES” financing) at a price per share of Common Stock (the “New
Issue Price”) that is less than the Exercise Price or the Fair Market Value
then in effect as the record date or Issue Date (as defined below),  as the case
may be (the “Relevant  Date”)  (treating the price per share of Common
Stock, in the case of the issuance of any Common Stock  Equivalent,  as equal to
(x) the sum of the price for such Common Stock  Equivalent  plus any  additional
consideration payable (without regard to any anti-dilution adjustments) upon the
conversion,  exchange or exercise of such Common Stock Equivalent divided by (y)
the number of shares of Common  Stock  initially  underlying  such Common  Stock
Equivalent),  other than  (i) issuances or sales for which an adjustment is
made  pursuant to another  subsection  of this  Section 5 and (ii)  issuances in
connection with an Excluded Transaction, then, and in each such case, (A)
the  Exercise  Price then in effect  shall be adjusted to equal to the new Issue
Price and (B) the Warrant  Share  Number shall be increased to equal the product
of (i) the  aggregate  number of  Warrant  Shares  for  which  this  Warrant  is
exercisable immediately prior to the New Issuance multiplied by (ii) a fraction,
the  numerator  of  which  shall be the  Exercise  Price  in  effect  on the day
immediately prior to the Relevant Date and the denominator of which shall be the
Exercise Price in effect immediately after such adjustment. 

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Such  adjustment  shall  be  made
whenever such shares of Common Stock or Common Stock Equivalent are issued,  and shall
 become  effective  retroactively  (x) in the case of an  issuance  to the stockholders
of the Company, as such, to a date immediately  following the close of business on the
records date for the  determination of shareholders  entitled to receive such shares of
Common Stock or Common  Stock  Equivalents  and (y) in all other cases,  on the date (the
 “Issue  Date”)  of such  issuance; provided, however,  that  the
 determination  as  to  whether  an adjustment  is  required to be made  pursuant to this
 Section 5.2 shall be made only  upon  the  issuance  of such  shares  of  Common  Stock
 or  Common  Stock Equivalents,  and not upon the  issuance of any  security  into which
the Common Stock Equivalents convert, exchange or may be exercised.  

       
            (b)       
In case at any time any shares of Common  Stock or Common Stock  Equivalents  or
any rights or options to purchase  any shares of Common  consideration  received
therefor  shall be deemed to be the amount  received  by the  Company  therefor,
without  deduction  therefrom  of  any  expense  incurred  or  any  underwriting
commissions  or  concessions  or  discounts  paid or allowed  by the  Company in
connection  therewith,  as determined mutually by the Board of Directors and the
Majority  Warrantholders  or,  if  the  Board  of  Directors  and  the  Majority
Warrantholders  shall  fail  to  agree,  at  the  Company’s  expense  by an
appraiser  chosen by the Board of Directors  and  reasonably  acceptable  to the
Majority Warrantholders. 

       
            (c)       
If any Common Stock Equivalents (or any portions thereof) which shall have given
rise to an  adjustment  pursuant  to this  Section  5.2 shall  have  expired  or
terminated without the exercise thereof and/or if by reason of the terms of such
Common Stock  Equivalents  there shall have been an increase or increases,  with
the passage of time or  otherwise,  in the price  payable  upon the  exercise or
conversion  thereof,  then the Exercise Price hereunder shall be readjusted (but
to no greater  extent than  originally  adjusted) in order to (i) eliminate from
the  computation  any additional  shares of Common Stock  corresponding  to such
Common Stock  Equivalents  as shall have expired or  terminated,  (ii) treat the
additional  shares of Common Stock, if any, actually issued or issuable pursuant
to the previous  exercise of such Common Stock Equivalents as having been issued
for the consideration  actually received and receivable therefor and (iii) treat
any of such Common Stock Equivalents  which remain  outstanding as being subject
to exercise or conversion  on the basis of such exercise or conversion  price as
shall be in effect at the time. 

       5.3
    Certain  Distributions.   In case the Company  shall at any time or from time to
time, after the issuance of this Warrant but prior to the exercise hereof, distribute to
all holders of shares of Common Stock (including any such distribution made as a rights
offering or in connection with a merger or consolidation in which the Company is the
resulting or surviving Person and shares of Common Stock are not changed or exchanged)
cash, evidences of indebtedness of the Company or another issuer, securities of the
Company or another issuer or other assets (excluding dividends or distributions payable
in shares of Common Stock for which adjustment is made under Section 5.1) or rights or
warrants to subscribe for or purchase any of the foregoing, then, and in each such
case, (A) the Exercise Price then in effect shall be adjusted (and any other appropriate
actions shall be taken by the Company) by being multiplied by the Exercise Price in
effect prior to the date of distribution by a fraction (i) the numerator of which shall
be such Current Market Price of Common Stock immediately prior to the date of
distribution less the then fair market value (as determined by the Board of Directors in
the exercise of their fiduciary duties) of the portion of the cash, evidences of
indebtedness, securities or other assets so distributed or of such rights or warrants
applicable to one share of Common Stock and (ii) the denominator of which shall be the
Current Market Price of the Common Stock immediately prior to the date of distribution
(but such fraction shall not be greater than one) and (B) the number of Warrant Shares
issuable hereunder shall be increased by being multiplied by a fraction (i) the numerator
of which shall be the distribution of such cash, evidences of indebtedness, securities,
other assets or rights or warrants and (ii) the denominator of which shall be the Current
Market Price of one share of Common Stock immediately prior to such record date less the
fair market value (as determined by the Board of Directors in the exercise of their
fiduciary duties) of the portion of such cash, evidences of indebtedness, securities,
other assets or rights or warrants so distributed. Such adjustment shall be made whenever
any such distribution is made and shall become effective retroactively to a date
immediately following the close of business on the record date for the determination of
stockholders entitled to receive such distribution.  

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       5.4
    Other Changes.   In case the  Company  at any time or from time to time,  after the
issuance of this Warrant but prior to the exercise hereof, shall take any action
affecting its Common Stock similar to or having an effect similar to any of the actions
described in any of Sections 5.1, 5.2, 5.3 or 5.8 (but not including any action described
in any such Section) and the Board of Directors in good faith determines that it would be
equitable in the circumstances to adjust the Exercise Period and number of Warrant Shares
issuable hereunder as a result of such action, then, and in each such case, the Exercise
Price and number of Warrant Shares issuable hereunder shall be adjusted in such manner
and at such times as the Board of Directors in good faith determines would be equitable
in the circumstances (such determination to be evidenced in a resolution, a certified
copy of which shall be mailed to the Warrantholder).  

       5.5
    No  Adjustment;  Par  Value  Minimum.    Notwithstanding  anything  herein to the
contrary, no adjustment under this Section 5 need be made to the Exercise Price or number
of Warrant Shares issuable hereunder if the Company receives written notice from the
Warrantholder that no such adjustment is required. Notwithstanding any other provision of
this Warrant, the Exercise Price shall not be adjusted below the par value of a share of
Common Stock.  

       5.6
    Abandonment.  If the  Company  shall take a record of the  holders of shares of its
Common Stock for the purpose of entitling them to receive a dividend or other
distribution, and shall thereafter and before the distribution to stockholders thereof
legally abandon its plan to pay or deliver such dividend or distribution, then no
adjustment in the Exercise Price or number of Warrant Shares issuable hereunder shall be
required by reason of the taking of such record.  

       5.7
    Certificate  as to  Adjustments.   Upon any  adjustment in the Exercise Price or
number of Warrant Shares issuable hereunder, the Company shall within a reasonable period
(not to exceed ten (10) days) following any of the foregoing transactions deliver to the
Warrantholder a certificate, signed by (i) the Chief Executive Officer of the Company and
(ii) the Chief Financial Officer of the Company, setting forth in reasonable detail the
event requiring the adjustment and the method by which such adjustment was calculated and
specifying the adjusted Exercise Price and number of Warrant Shares issuable hereunder
then in effect following such adjustment.  

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       5.8
    Spin-off, Reorganization, Reclassification, Merger or Sale Transaction. 

       
       (a)       
In case of any  spin-off  by the Company of another  Person (the  “Spin-off
Entity) at any time after the issuance of this Warrant but prior to the exercise
hereof, the Company shall issue to the Warrantholder a new warrant,  in form and
substance satisfactory to the Company and the Majority Warrantholders, entitling
the Warrantholder to purchase,  at the exercise price determined by the Board of
Directors and reasonably acceptable to the Majority  Warrantholders,  the number
of shares of common stock or other  proprietary  interest in the Spin-off Entity
that the Warrantholder would have owned had the Warrantholder, immediately prior
to such spin-off, exercised this Warrant. 

       
       (b)       
In case  of any  capital  reorganization,  reclassification,  Sale  Transaction,
merger  or  consolidation  (other  than  a  Sale  Transaction  or  a  merger  or
consolidation  of the Company in which the Company is the surviving  corporation
and there has been no change in the terms of the Common Stock) of the Company or
other change of  outstanding  shares of Common Stock (other than a change in par
value,  or from par value to no par  value,  or from no par value to par  value)
(each, a “Transaction”) at any time after the issuance of this Warrant
but prior to the exercise  hereof,  the Company shall execute and deliver to the
Warrantholder  at least  twenty  (20)  Business  Days  prior to  effecting  such
Transaction a certificate  stating that the  Warrantholder  shall have the right
thereafter  to exercise  this Warrant for the kind and amount of shares of stock
or other  securities,  property or cash  receivable  upon such  Transaction by a
holder of the number of shares of Common Stock  pursuant to the  Certificate  of
Incorporation  of the Company into which this Warrant could have been  exercised
immediately prior to such  Transaction,  and provision shall be made therefor in
the  agreement,  if any,  relating to such  Transaction.  The provisions of this
Section 5.2 and any equivalent  thereof in any such certificate  similarly shall
apply to successive transactions. 

       5.9
    Notices.  In case at any time or from time to time: 

       
       (a)       
the Company shall declare a dividend (or any other distribution) on its shares of Common
Stock; 

       
       (b)       
the Company shall  authorize the granting to the holders of shares of its Common
Stock  rights or warrants  to  subscribe  for or purchase  any shares of Capital
Stock or any other rights or warrants; 

       
       (c)       there
shall occur a spin-off Transaction; or  

       
            (d)       
the  Company  shall  take any  other  action  that  would  require a vote of the
Company’s stockholders; 

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then the Company shall mail to the
Warrantholder, as promptly as possible but in any event at least ten (10) days prior to
the applicable date hereinafter specified, a notice stating (A) the date on which a record
is to be taken for the purpose of such vote or dividend, distribution or granting of
rights or warrants or, if a record is not to be taken, the date as of which the holders of
Common Stock of record to be entitled to such dividend, distribution or granting of rights
or warrants are to be determined, or (B) the date on which such spin-off Transaction is
expected to become effective and the date as of which it is expected that holders of
Common Stock of record shall be entitled to exchange their Common Stock for shares of
stock or other securities or property or cash deliverable upon such spin-off Transaction.
Notwithstanding the foregoing, in the case of any event to which Section 5.8 is
applicable, the Company shall also deliver the certificate described in such Section 5.8
to the Warrantholder at least ten (10) Business Days prior to effecting such
reorganization or reclassification as aforesaid. 

       6.       
Loss or Destruction of Warrant.   Subject to the terms and conditions hereof,
upon  receipt by the Company of evidence  reasonably  satisfactory  to it of the
loss, theft, destruction or mutilation of this Warrant and, in the case of loss,
theft  or  destruction,  of such  bond or  indemnification  as the  Company  may
reasonably  require,  and, in the case of such  mutilation,  upon  surrender and
cancellation of this Warrant, the Company will execute and deliver a new Warrant
of like tenor. 

       7.       
Ownership of  Warrant.    The  Company  may deem and treat the Person in whose name
this Warrant is registered as the holder and owner hereof  (notwithstanding  any
notations of ownership or written  hereon made by anyone other than the Company)
for all purposes and shall not be affected by any notice to the contrary,  until
presentation of this Warrant for registration of transfer. 

       8.     
  Amendments.       Any  provision  of this Warrant may be amended and the  observance  thereof
waived  only with the  written  consent of the  Company  and the  Warrantholder.

       9.   
    Definitions.  As used herein, unless the context otherwise requires,  the following terms
have the following respective meanings: 

        
        “Board of Directors” means the Board of Directors of the Company. 

        
        “Business
Day” means any day other than a Saturday, Sunday or other day on which commercial
banks in the State of York are authorized or required by law or executive order to close. 

        
        “Capital
Stock” means, with respect to any Person, any and all shares, interests,
participations, rights in, or other equivalent (however designated and whether voting or
non-voting) of such Person’s capital stock and any and all rights, warrants or
options exchangeable for or convertible into such capital stock (but excluding any debt
security whether or not it is exchangeable for or convertible into such capital stock). 

        
        “Common
Stock” means the Common Stock, par value $0.01 per share, of the Company. 

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        “Common Stock
Equivalent” means any security or obligation other than Company’s Series E
Junior Convertible Preferred Stock which is by its terms convertible into or exercisable
into shares of Common Stock, including, without limitation, any option, warrant or other
subscription or purchase right with respect to Common Stock. 

        
        “Company”
has the meaning set forth in the first paragraph of this Warrant. 

        
        “Conversion
Rights” has the meaning set forth in Section 2.2(a) of this Warrant. 

        
        “Current
Market Price” means, as of the date of determination, (a) the average of the
daily Market Price under clause (a), (b) or (c) of the definition thereof of the Common
Stock during the immediately preceding thirty (30) trading days ending on such date, and
(b) if the Common Stock is not then listed or admitted to trading on any national
securities exchange or quoted in the over-the-counter market, then the Market Price under
clause (d) of the definition thereof on such date. 

        
        “Excluded
Transaction” means (a) any issuance or grant (“award”) of shares of
stock, restricted stock or options to purchase shares of Common Stock as compensation, or
as a pre-employment award, to employees, officers, directors or consultants of the Company
or of any Subsidiary of the Company, provided that if at the time of such award the
number of shares of Common Stock awarded and the number of shares of Common Stock issuable
upon exercise of the stock option awarded, when combined with all other shares of Common
Stock issued or issuable pursuant to awards made pursuant to this clause (a) during the
Exercise Period (i.e., excluding the Lund and Regal management awards and other awards
existing on the date hereof) exceeds 5% of the fully diluted shares of Common Stock
outstanding on the date of such award, then the new award shall not be deemed an Excluded
Transaction, (b) any issuance of Warrant Shares, (c) any issuance of securities as part of
the consideration in a merger or consolidation of the Company in which the Company is the
surviving corporation and there has been no change in the terms of the Common Stock, (d)
the issuance of up to 27,000,000 shares of Common Stock by the Company to acquire IFS of
New Jersey, Inc. (including shares of Common Stock issued upon mandatory conversion of the
Series E Junior Convertible Preferred Stock of the Company), (e) the issuance of up to
16,000,000 shares of Common Stock to investors in a private placement pursuant to
subscription agreements on or before the date hereof, (f) the issuance of up to 900,000
shares of Common Stock by the Company to Allen & Company Incorporated in partial
satisfaction of its fee in connection with the issuance referred to in clause (e) above,
(g) the issuance of any shares of the Company’s Series E Junior Convertible Preferred
Stock in connection with the Company’s acquisition of IFS of New Jersey, Inc., (h)
the issuance and the exercise of this Warrant and/or the Other Warrant, (i) the grant of
additional warrants to the holder of the Other Warrant in the event of an anti-dilution
adjustment pursuant to Section 5 of the Other Warrant, and (j) the issuance of any
“Equity Securities” (as defined in Section 7 of the Certificate of Designations)
of the Company, the proceeds of which are used to the extent required or permitted by
Section 7 of the Certificate of Designations. 

        
        “Exercise
Form” means an Exercise Form in the form annexed hereto as Exhibit A. 

        
        “Exercise Period”
means the period from January 14, 2003 to January 13, 2008. 

9

	

        
        “Exercise
Price” has the meaning set forth in the first paragraph of this Warrant. 

        
        “Fair
Market Value” means on any date of determination with respect to any shares of
Common Stock, an amount equal to the product of (i) the fair market value on such date of
the consolidated net worth of the Company, as determined in good faith by the Board of
Directors and (ii) the percentage such shares of Common Stock represent of all the then
outstanding shares of Common Stock. 

        
        “Issue
Date” has the meaning set forth in Section 5.2 of this Warrant. 

        
        “Market
Price” means, as of the date of determination, (a) if the Common Stock is listed
on a national securities exchange, the closing price per share of Common Stock on such
date published in The Wall Street Journal (National Edition) or, if no such
closing price on such date is published in The Wall Street Journal (National
Edition), the average of the closing bid and asked prices on such date, as officially
reported on the principal national securities exchange on which the Common Stock is then
listed or admitted to trading; or (b) if the Common Stock is not then listed or admitted
to trading on any national securities exchange but is designated as a national market
system security by the National Association of Securities Dealers, Inc., the last trading
price of the Common Stock on such date; or (c) if there shall have been no trading on such
date or if the Common Stock is not designated as a national market system security by the
National Association of Securities Dealers, Inc., the average of the reported closing bid
and asked prices of the Common Stock on such date as shown by the National Market System
of the National Association of Securities Dealers, Inc. Automated Quotations System and
reported by any member firm of the New York Stock Exchange selected by the Company; or (d)
if none of (a), (b) or (c) is applicable, a market price per share determined mutually by
the Board of Directors and the Majority Warrantholders or, if the Board of Directors and
the Majority Warrantholder shall fail to agree, at the Company’s expense by an
appraiser chosen by the Board of Directors and reasonably acceptable to the Majority
Warrantholders. Any determination of the Market Price by an appraiser shall be based on a
valuation of the Company as an entirety without regard to any discount for minority
interest or disparate voting rights among classes of capital stock. 

        
        “Majority
Warrantholders” means the holders of a majority of Warrant Shares issuable upon
exercise in full of both the Warrant and the Other Warrant assuming the exercise of all
such warrants. 

        
        “Person”
means any individual, firm, corporation, partnership, limited liability company, trust,
incorporated or unincorporated association, joint venture, joint stock company,
governmental body or other entity of any kind. 

        
        “New
Issuance” has the meaning set forth in Section 5.2 of this Warrant. 

        
        “New Issue
Price” has the meaning set forth in Section 5.2 of this Warrant. 

        
        “Relevant
Date” has the meaning set forth in Section 5.2 of this Warrant. 

10

	

        
        “Sale
Transaction” shall mean (a)(i) the merger or consolidation of the Company into or
with one or more Persons, (ii) the merger or consolidation of one or more Persons into or
with the Company or (iii) a tender offer or other business combination if, in the case of
(i), (ii) or (iii), the stockholders of the Company prior to such merger or consolidation
do not retain at least a majority of the voting power of the surviving Person or (b) the
voluntary sale, conveyance, exchange or transfer to another Person of (i) the voting
Capital Stock of the Company if, after such sale, conveyance, exchange or transfer do not
retain at least a majority of the voting power of the Company or (ii) all or substantially
all of the assets of the Company. 

        
        “Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations
of the Securities and Exchange Commission thereunder. 

        
        “Spin-off
Entity” has the meaning set forth in Section 5.8 of this Warrant. 

        
        “Transaction”
has the meaning set forth in Section 5.8 of this Warrant. 

        
        “Warrant
Shares” has the meaning set forth in the first paragraph of this Warrant. 

        
        “Warrant Share
Number” has the meaning set forth in Section 5.1 of this Warrant. 

        
        “Warrantholder”
has the meaning set forth in first paragraph of this Warrant. 

       10.    
Miscellaneous. 

       10.1    
Entire   Agreement.   This  Warrant  and  the  Registration   Rights  Agreement
constitute the entire agreement between the Company and the Warrantholder with respect to
this Warrant and supersedes all prior agreements and understanding with respect to the
subject matter of this Warrant.  

       10.2    
Binding  Effect;  Benefits.   This  Warrant  shall  inure to the  benefit of and shall
be binding upon the Company and the Warrantholder and their respective permitted
successors and assigns. Nothing in this Warrant, expressed or implied, is intended to or
shall confer on any person other than the Company and the Warrantholder, or their
respective permitted successors or assigns, any rights, remedies, obligations or
liabilities under or by reason of this Warrant.  

       10.3    
Headings.    The heading in this Warrant are for  convenience  of reference  only and
shall not limit or otherwise affect the meaning of this Warrant.  

       10.4    
Notices.    All  notices,  demands  and  other  communications  provided  for  or
permitted hereunder shall be made in writing and shall be by registered or certified
first-class mail, return receipt requested, telecopier, courier, service or personal
delivery:  

11

		
	         
         (a)  
if to the Company:	
	                           
	                           Eos International, Inc.
	                           888 Seventh Avenue
	                           New York, New York 10106
	                           Telecopy: 212-554-9873
	                           Attention:  James M. Cascino,
	                           
                   Chief Executive Officer
	                  
	                  with a copy to:
	                  
	                           Pitney, Hardin, Kipp & Szuch LLP
	                           Park Avenue at Morris County
	                           P.O. Box 1945
	                           Morristown, New Jersey 07962
	                           Telecopy:  973-966-1550	
	                           Attention:   Frank E. Lawatsch, Esq.
	                  
	        
          (b)   if to the Warrantholder, at its address as it appears
                           on the record books of the Company.	
	                  
	                  with a copy to:
	                  
	                           Paul, Weiss, Rifkind, Wharton & Garrison
	                           1285 Avenue of the Americas
	                           New York, New York 10019-6064
	                           Telecopy:  (212) 757-3990
	                           Attention:   Carl Reisner, Esq.
	                  	 
	                  	 
	 

	

        All
such notices, demands and other communications shall be deemed to have been duly given
when delivered by hand, if personally delivered; when delivered by courier, if delivered
by commercial courier service, five (5) Business Days after being deposited in the mail,
postage prepaid, if mailed; and when receipt is mechanically acknowledged, if telecopied.
Any party may by notice given in accordance with this Section 10.4 designated another
address or Person for receipt of notices hereunder. 

       10.5
    Severability.   Any  term or  provision  of this  Warrant  which is  invalid  or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the
extent of such invalidity or unenforceability without rendering invalid or unenforceable
the terms and provisions of this Warrant or affecting the validity or enforceability of
any terms or provisions of this Warrant in any other jurisdiction.  

       10.6
    Governing  Law.    This Warrant  shall be governed by and construed in accordance with
the laws of the State of Delaware without regard to the conflict of law principle
thereof.  

12

	

       10.7
    No Rights or Liabilities  as  Stockholders.    Nothing  contained in this Warrant shall
be determined as conferring upon the Warrantholder any rights as a stockholder of the
Company or as imposing any liabilities on the Warrantholder to purchase any securities
whether such liabilities are asserted by the Company or by creditors or stockholders of
the Company as otherwise.  

[Remainder
of this page intentionally left blank] 

13

	

        IN
WITNESS WHEREOF, the Company has caused this Warrant to be signed by its duly authorized
officer. 

	

Dated:   January 14, 2003		EOS INTERNATIONAL, INC.

By:  PETER A. LUND
——————————————

  Peter A. Lund

  Chairman
       

	

	

Exhibit A 

EXERCISE FORM 

(To
be executed upon exercise of this Warrant) 

        The
undersigned hereby irrevocably elects to exercise the right, represented by this Warrant,
to purchase ___________________ shares of Common Stock and herewith tenders payment for
such shares to the order of the Company in the amount of $___________________ [hereby
exercises its Conversion Rights] in accordance with the terms of this Warrant. The
undersigned requests that a certificate for such Warrant Shares be registered in the name
of the undersigned and that such certificates be delivered to the undersigned’s
address below. 

        The
undersigned represents that it is acquiring such shares for its own account for investment
and not with a view to or for sale in connection with any distribution thereof (subject,
however, to any requirement of law that the disposition thereof shall at all times be
within its control). 

			
	Dated:		Signature:  ____________________
			

			_____________________________

(Print Name)
			

			_____________________________

(Street Address)
			

			_____________________________

(City)                 (State)
    (Zip Code)Exhibit 10.114 - Amended and Restated Common Stock Purchase Warrant

	

W-W1 

1,384,615 Warrant Shares 

THIS WARRANT AND ANY SECURITIES
ACQUIRED UPON THE EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OR FOREIGN JURISDICTION. NEITHER THIS WARRANT, SUCH SECURITIES NOR ANY
INTEREST THEREIN MAY BE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER SUCH ACT AND APPLICABLE STATE AND FOREIGN SECURITIES LAWS OR PURSUANT TO AN
APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT AND SUCH LAWS. 

     

EOS INTERNATIONAL, INC. 

AMENDED AND RESTATED
COMMON STOCK PURCHASE WARRANT 

     

        This
certifies that, for good and valuable consideration, EOS INTERNATIONAL, INC., a Delaware
corporation (the “Company”), grants to WEICHERT ENTERPRISE LLC, a Delaware
limited liability company (the “Warrantholder”), the right to subscribe for and
purchase from the Company, during the Exercise Period (as hereinafter defined), 1,384,615
validly issued, fully paid and nonassessable shares, par value $0.01, of Common Stock of
the Company (the “Warrant Shares”), at the exercise price per share of $0.25 per
share (the “Exercise Price”), all subject to the terms, conditions and
adjustments herein set forth. Capitalized terms used herein shall have the meanings
ascribed to such terms in Section 9 below. 

         1.       
          Warrant.  This Amended and Restated Common Stock Purchase Warrant (this
          “Warrant”) is issued by the Company contemporaneously with the
          Company’s issuance of a warrant for 1,615,385 Warrant Shares (the
          “Other Warrant”) to DL Holdings I, L.L.C. (the “Other
          Warrantholder”) and is subject to the terms of the Amended and Restated
          Registration Rights Agreement, dated as of January 14, 2003 (the
          “Registration Rights Agreement”), among the Company, the Warrantholder
          and the Other Warrantholder. 

         2.       
          Exercise of Warrant; Payment of Taxes. 

       2.1    
Exercise  of Warrant.    Subject to the terms and  conditions  set forth  herein, this
Warrant may be exercised at any time, in whole or in part, by the Warrantholder during
the Exercise Period by:  

       
       (a)                 the
surrender of this Warrant to the Company, with a duly executed Exercise Form, and 

	

       
            (b)       
subject to Section 2.2 below,  the delivery of payment of the  Company,  for the
account of the Company, by (i) cash,  wire transfer,  certified or official
bank check or any other means approved by the Company, of the aggregate Exercise
Price in lawful money of the United States of America or (ii) the surrender
of  Series D  Preferred Stock of the Company (the  “Series D Preferred
Stock”)  valued at the Redemption Price as determined by the Certificate of
Designations  of  the   Series D   Preferred  Stock  of  the  Company  (the
“Certificate of  Designations”) on the date surrendered to the Company
or (iii) a combination of (i) and (ii); provided, however, that the Company
reserves  the  right  to  refuse  to  accept  Series D  Preferred  Stock as
consideration for the exercise of the Warrant if it would violate law or violate
the provisions of any agreement to which the Company is a party. 

The Company agrees that the Warrant
Shares shall be deemed to be issued to the Warrantholder as the record holder of such
Warrant Shares as of the close of business on the date on which this Warrant shall have
been surrendered and payment made for the Warrant Shares as aforesaid. 

       
2.2    Conversion Right. 

       
            (a)       
In lieu of the payment of the aggregate Exercise Price, the Warrantholder  shall
have the right (but not the obligation),  to require the Company to convert this
Warrant, in whole or in part, into shares of Common Stock (the  “Conversion
Right”)  as  provided  for  in  this  Section  2.2.  Upon  exercise  of the
Conversion  Right,  the  Company  shall  deliver to the  Warrantholder  (without
payment by the  Warrantholder  of any of the Exercise  Price) in accordance with
Section  2.1(b)  that  number of shares of Common  Stock  equal to the  quotient
obtained by dividing (i) the value of the Warrant or portion thereof at the time
the  Conversion  Right is exercised  (determined  by  subtracting  the aggregate
Exercise  Price at the time of the  exercise  of the  Conversion  Right from the
aggregate  Current  Market  Price for the shares of Common Stock  issuable  upon
exercise of the Warrant at the time of the exercise of the Conversion  Right) by
(ii) the Current  Market  Price of one share of Common  Stock at the time of the
exercise of the Conversion Right. 

       
            (b)       
The Conversion  Right may be exercised by the  Warrantholder on any Business Day
prior to the end of the  Exercise  Period by  surrender  of this  Warrant to the
Company,  with a  duly  executed  Exercise  Form  with  the  conversion  section
completed,  exercising the  Conversion  Right and specifying the total number of
shares of Common Stock that the  Warrantholder  will be issued  pursuant to such
conversion. 

       2.3
    Warrant  Shares  Certificate.    A  stock  certificate  or  certificates  for the
Warrant Shares specified in the Exercise Form shall be delivered to the Warrantholder
within five (5) Business Days after receipt of the Exercise Form by the Company and, if
the Conversion Right is not exercised, the payment by the Warrantholder of the aggregate
Exercise Price. If this Warrant shall have been exercised only in part, the Company
shall, at the time of delivery of the stock certificate or certificates, deliver to the
Warrantholder a new Warrant evidencing the right to purchase the remaining Warrant
Shares, which new Warrant shall in all other respects be identical with this Warrant.  

       2.4
    Payment  of  Taxes.    The  Company  will  pay all  documentary  stamp  or  other
issuance taxes, if any, attributable to the issuance of Warrant Shares upon the exercise
of this Warrant; provided, however, that the Company shall not be required to pay
any tax or taxes which may be payable in respect of any transfer involved in the issue or
delivery of any Warrants or Warrant certificates or Warrant Shares in a name other than
that of the them Warrantholder as reflected upon the books of the Company.  

2

	

    3.                  Restrictions
on Transfer; Restrictive Legends.  

       3.1
    This  Warrant and the Warrant  Shares may not be  offered,  sold,  transferred,
pledged or otherwise disposed of, in whole or in part, to any Person other than in
accordance with applicable federal and state securities laws.  

       3.2
    Except as  otherwise  permitted  by this  Section 3, each  Warrant (and Warrant
issued in substitution for any Warrant pursuant to Section 6) shall be stamped or
otherwise imprinted with a legend in substantially the form as set forth on the cover of
this Warrant. Notwithstanding the foregoing, the Warrantholder may require the Company to
issue a Warrant or a certificate for Warrant Shares, in each case without a legend, if
either (i) such Warrant or such Warrant Shares, as the case may be, have been registered
for resale under the Securities Act, (ii) the Warrantholder has delivered to Company an
opinion of legal counsel (from a firm reasonably satisfactory to the Company) which
opinion shall be addressed to the Company and be reasonably satisfactory in form and
substance to the Company’s counsel, to the effect that such registration is not
required with respect to such Warrant or such Warrant Shares, as the case may be or (iii)
such Warrant or Warrant Shares may be sold pursuant to Rule 144 (or any successor
provision then in effect) under the Securities Act.  

         4.       
          Reservation and Registration of Shares. The Company covenants and agrees
          as follows: 

       
            (a)       
All Warrant Shares that are issued upon the exercise of this Warrant shall, upon
issuance,  be validly issued,  not subject to any preemptive rights, and be free
from all taxes, liens,  security interest,  charges, and other encumbrances with
respect to the  issuance  thereof,  other than taxes in respect of any  transfer
occurring contemporaneously with such issue. 

       
            (b)       
The Company  shall at all times have  authorized  and  reserved,  and shall keep
available  and free from  preemptive  rights,  a sufficient  number of shares of
Common  Stock to provide  for the  exercise  of the rights  represented  by this
Warrant. 

       
            (c)       
The Company  shall not, by  amendment of its  Certificate  of  Incorporation  or
through any reorganization, transfer of assets, spin-off, consolidation, merger,
dissolution,  issue or sale of securities or any other action or inaction,  seek
to avoid the observance or performance of any of the terms of this Warrant,  and
shall at all times in good faith assist in  performing  and giving effect to the
terms  hereof  and in the  taking of all such  actions  as may be  necessary  or
appropriate in order to protect the rights of the Warrantholder against dilution
or other impairment. 

         5.       
          Anti-dilution Adjustment.   The Exercise Price and the number of Warrant
          Shares to be received upon exercise of this Warrant shall be subject to
          adjustment as follows: 

3

	

       5.1
    Dividend,  Subdivision,  Combination or  Reclassification  of Common Stock.    In the
event that the Company shall at any time or from time to time, after the issuance of this
Warrant but prior to the exercise hereof, (w) make a dividend or distribution on the
outstanding shares of Common Stock payable in Capital Stock, (x) subdivide the
outstanding shares of Common Stock into a larger number of shares, (y) combine the
outstanding shares of Common Stock into a smaller number of shares or (z) issue any
shares of its Capital Stock in a reclassification of the Common Stock (other than any
such event for which an adjustment is made pursuant to another clause of this Section 5),
then, and in each such case, (A) the aggregate number of Warrant Shares for which this
Warrant is exercisable (the “Warrant Share Number”) immediately prior to such
event shall be adjusted (and any other appropriate actions shall be taken by the Company)
so that the Warrantholder shall be entitled to receive upon exercise of this Warrant the
number of shares of Common Stock or other securities of the Company that it would have
owned or would have been entitled to receive upon or by reason of any of the events
described above, had this Warrant been exercised immediately prior to the occurrence of
such event and (B) the Exercise Price payable upon the exercise of this Warrant shall be
adjusted by multiplying such Exercise Price immediately prior to such adjustment by a
fraction, the numerator of which shall be the number of Warrant Shares issuable upon the
exercise of this Warrant immediately prior to such adjustment, and the denominator of
which shall be the number of Warrant Shares issuable immediately thereafter. An
adjustment made pursuant to this Section 5.1 shall become effective retroactively (x) in
the case of any such dividend or distribution, to a date immediately following the close
of business on the record date for the determination of holders of shares of Common Stock
entitled to receive such dividend or distribution or (y) in the case of any such
subdivision, combination or reclassification, to the close of business on the day upon
which such corporate action becomes effective.  

       5.2
    Issuance of Common Stock or Common Stock  Equivalents  Below Exercise Price or the
Fair Market Value.  

       
            (a)       
Except in the circumstances contemplated by Section 5.1, if the Company shall at
any time from time to time,  after the issuance of this Warrant but prior to the
exercise   hereof,   issue  or  sell  (such   issuance  or  sale,   a  “New
Issuance”)  any shares of Common Stock or Common Stock  Equivalent  (which,
for  purposes   hereof,   shall  include  any  security  issued  as  part  of  a
“PIPES” financing) at a price per share of Common Stock (the “New
Issue Price”) that is less than the Exercise Price or the Fair Market Value
then in effect as the record date or Issue Date (as defined below),  as the case
may be (the “Relevant  Date”)  (treating the price per share of Common
Stock, in the case of the issuance of any Common Stock  Equivalent,  as equal to
(x) the sum of the price for such Common Stock  Equivalent  plus any  additional
consideration payable (without regard to any anti-dilution adjustments) upon the
conversion,  exchange or exercise of such Common Stock Equivalent divided by (y)
the number of shares of Common  Stock  initially  underlying  such Common  Stock
Equivalent),  other than  (i) issuances or sales for which an adjustment is
made  pursuant to another  subsection  of this  Section 5 and (ii)  issuances in
connection with an Excluded Transaction, then, and in each such case, (A)
the  Exercise  Price then in effect  shall be adjusted to equal to the new Issue
Price and (B) the Warrant  Share  Number shall be increased to equal the product
of (i) the  aggregate  number of  Warrant  Shares  for  which  this  Warrant  is
exercisable immediately prior to the New Issuance multiplied by (ii) a fraction,
the  numerator  of  which  shall be the  Exercise  Price  in  effect  on the day
immediately prior to the Relevant Date and the denominator of which shall be the
Exercise Price in effect immediately after such adjustment. 

4

	

Such adjustment shall be made
whenever such shares of Common Stock or Common Stock Equivalent are issued, and shall
become effective retroactively (x) in the case of an issuance to the stockholders of the
Company, as such, to a date immediately following the close of business on the records
date for the determination of shareholders entitled to receive such shares of Common Stock
or Common Stock Equivalents and (y) in all other cases, on the date (the “Issue
Date”) of such issuance; provided, however, that the determination as
to whether an adjustment is required to be made pursuant to this Section 5.2 shall be made
only upon the issuance of such shares of Common Stock or Common Stock Equivalents, and not
upon the issuance of any security into which the Common Stock Equivalents convert,
exchange or may be exercised. 

       
            (b)       
In case at any time any shares of Common  Stock or Common Stock  Equivalents  or
any rights or options to purchase  any shares of Common  consideration  received
therefor  shall be deemed to be the amount  received  by the  Company  therefor,
without  deduction  therefrom  of  any  expense  incurred  or  any  underwriting
commissions  or  concessions  or  discounts  paid or allowed  by the  Company in
connection  therewith,  as determined mutually by the Board of Directors and the
Majority  Warrantholders  or,  if  the  Board  of  Directors  and  the  Majority
Warrantholders  shall  fail  to  agree,  at  the  Company’s  expense  by an
appraiser  chosen by the Board of Directors  and  reasonably  acceptable  to the
Majority Warrantholders. 

       
            (c)       
If any Common Stock Equivalents (or any portions thereof) which shall have given
rise to an  adjustment  pursuant  to this  Section  5.2 shall  have  expired  or
terminated without the exercise thereof and/or if by reason of the terms of such
Common Stock  Equivalents  there shall have been an increase or increases,  with
the passage of time or  otherwise,  in the price  payable  upon the  exercise or
conversion  thereof,  then the Exercise Price hereunder shall be readjusted (but
to no greater  extent than  originally  adjusted) in order to (i) eliminate from
the  computation  any additional  shares of Common Stock  corresponding  to such
Common Stock  Equivalents  as shall have expired or  terminated,  (ii) treat the
additional  shares of Common Stock, if any, actually issued or issuable pursuant
to the previous  exercise of such Common Stock Equivalents as having been issued
for the consideration  actually received and receivable therefor and (iii) treat
any of such Common Stock Equivalents  which remain  outstanding as being subject
to exercise or conversion  on the basis of such exercise or conversion  price as
shall be in effect at the time. 

       5.3
    Certain  Distributions.    In case the Company  shall at any time or from time to
time, after the issuance of this Warrant but prior to the exercise hereof, distribute to
all holders of shares of Common Stock (including any such distribution made as a rights
offering or in connection with a merger or consolidation in which the Company is the
resulting or surviving Person and shares of Common Stock are not changed or exchanged)
cash, evidences of indebtedness of the Company or another issuer, securities of the
Company or another issuer or other assets (excluding dividends or distributions payable
in shares of Common Stock for which adjustment is made under Section 5.1) or rights or
warrants to subscribe for or purchase any of the foregoing, then, and in each such
case, (A) the Exercise Price then in effect shall be adjusted (and any other appropriate
actions shall be taken by the Company) by being multiplied by the Exercise Price in
effect prior to the date of distribution by a fraction (i) the numerator of which shall
be such Current Market Price of Common Stock immediately prior to the date of
distribution less the then fair market value (as determined by the Board of Directors in
the exercise of their fiduciary duties) of the portion of the cash, evidences of
indebtedness, securities or other assets so distributed or of such rights or warrants
applicable to one share of Common Stock and (ii) the denominator of which shall be the
Current Market Price of the Common Stock immediately prior to the date of distribution
(but such fraction shall not be greater than one) and (B) the number of Warrant Shares
issuable hereunder shall be increased by being multiplied by a fraction (i) the numerator
of which shall be the distribution of such cash, evidences of indebtedness, securities,
other assets or rights or warrants and (ii) the denominator of which shall be the Current
Market Price of one share of Common Stock immediately prior to such record date less the
fair market value (as determined by the Board of Directors in the exercise of their
fiduciary duties) of the portion of such cash, evidences of indebtedness, securities,
other assets or rights or warrants so distributed. Such adjustment shall be made whenever
any such distribution is made and shall become effective retroactively to a date
immediately following the close of business on the record date for the determination of
stockholders entitled to receive such distribution.  

5

	

       5.4
     Other  Changes.    In case the  Company  at any time or from time to time,  after the
issuance of this Warrant but prior to the exercise hereof, shall take any action
affecting its Common Stock similar to or having an effect similar to any of the actions
described in any of Sections 5.1, 5.2, 5.3 or 5.8 (but not including any action described
in any such Section) and the Board of Directors in good faith determines that it would be
equitable in the circumstances to adjust the Exercise Period and number of Warrant Shares
issuable hereunder as a result of such action, then, and in each such case, the Exercise
Price and number of Warrant Shares issuable hereunder shall be adjusted in such manner
and at such times as the Board of Directors in good faith determines would be equitable
in the circumstances (such determination to be evidenced in a resolution, a certified
copy of which shall be mailed to the Warrantholder).  

       5.5
    No  Adjustment;  Par  Value  Minimum.    Notwithstanding  anything  herein to the
contrary, no adjustment under this Section 5 need be made to the Exercise Price or number
of Warrant Shares issuable hereunder if the Company receives written notice from the
Warrantholder that no such adjustment is required. Notwithstanding any other provision of
this Warrant, the Exercise Price shall not be adjusted below the par value of a share of
Common Stock.  

       5.6
    Abandonment.    If the  Company  shall take a record of the  holders of shares of its
Common Stock for the purpose of entitling them to receive a dividend or other
distribution, and shall thereafter and before the distribution to stockholders thereof
legally abandon its plan to pay or deliver such dividend or distribution, then no
adjustment in the Exercise Price or number of Warrant Shares issuable hereunder shall be
required by reason of the taking of such record.  

       5.7
    Certificate  as to  Adjustments.    Upon any  adjustment in the Exercise Price or
number of Warrant Shares issuable hereunder, the Company shall within a reasonable period
(not to exceed ten (10) days) following any of the foregoing transactions deliver to the
Warrantholder a certificate, signed by (i) the Chief Executive Officer of the Company and
(ii) the Chief Financial Officer of the Company, setting forth in reasonable detail the
event requiring the adjustment and the method by which such adjustment was calculated and
specifying the adjusted Exercise Price and number of Warrant Shares issuable hereunder
then in effect following such adjustment.  

6

	

       5.8
    Spin-off, Reorganization, Reclassification, Merger or Sale Transaction. 

       
            (a)       
In case of any  spin-off  by the Company of another  Person (the  “Spin-off
Entity) at any time after the issuance of this Warrant but prior to the exercise
hereof, the Company shall issue to the Warrantholder a new warrant,  in form and
substance satisfactory to the Company and the Majority Warrantholders, entitling
the Warrantholder to purchase,  at the exercise price determined by the Board of
Directors and reasonably acceptable to the Majority  Warrantholders,  the number
of shares of common stock or other  proprietary  interest in the Spin-off Entity
that the Warrantholder would have owned had the Warrantholder, immediately prior
to such spin-off, exercised this Warrant. 

       
            (b)       
In case  of any  capital  reorganization,  reclassification,  Sale  Transaction,
merger  or  consolidation  (other  than  a  Sale  Transaction  or  a  merger  or
consolidation  of the Company in which the Company is the surviving  corporation
and there has been no change in the terms of the Common Stock) of the Company or
other change of  outstanding  shares of Common Stock (other than a change in par
value,  or from par value to no par  value,  or from no par value to par  value)
(each, a “Transaction”) at any time after the issuance of this Warrant
but prior to the exercise  hereof,  the Company shall execute and deliver to the
Warrantholder  at least  twenty  (20)  Business  Days  prior to  effecting  such
Transaction a certificate  stating that the  Warrantholder  shall have the right
thereafter  to exercise  this Warrant for the kind and amount of shares of stock
or other  securities,  property or cash  receivable  upon such  Transaction by a
holder of the number of shares of Common Stock  pursuant to the  Certificate  of
Incorporation  of the Company into which this Warrant could have been  exercised
immediately prior to such  Transaction,  and provision shall be made therefor in
the  agreement,  if any,  relating to such  Transaction.  The provisions of this
Section 5.2 and any equivalent  thereof in any such certificate  similarly shall
apply to successive transactions. 

       5.9
    Notices.   In case at any time or from time to time: 

       
            (a)       
the Company shall declare a dividend (or any other distribution) on its shares of Common Stock; 

       
            (b)       
the Company shall  authorize the granting to the holders of shares of its Common
Stock  rights or warrants  to  subscribe  for or purchase  any shares of Capital
Stock or any other rights or warrants; 

       
            (c)       
there shall occur a spin-off Transaction; or 

       
            (d)       
the Company shall take any other action that would require a vote of the Company’s
stockholders;

7

	

then the Company shall mail to the
Warrantholder, as promptly as possible but in any event at least ten (10) days prior to
the applicable date hereinafter specified, a notice stating (A) the date on which a record
is to be taken for the purpose of such vote or dividend, distribution or granting of
rights or warrants or, if a record is not to be taken, the date as of which the holders of
Common Stock of record to be entitled to such dividend, distribution or granting of rights
or warrants are to be determined, or (B) the date on which such spin-off Transaction is
expected to become effective and the date as of which it is expected that holders of
Common Stock of record shall be entitled to exchange their Common Stock for shares of
stock or other securities or property or cash deliverable upon such spin-off Transaction.
Notwithstanding the foregoing, in the case of any event to which Section 5.8 is
applicable, the Company shall also deliver the certificate described in such Section 5.8
to the Warrantholder at least ten (10) Business Days prior to effecting such
reorganization or reclassification as aforesaid. 

         6.       
          Loss or Destruction of Warrant.   Subject to the terms and conditions
          hereof, upon receipt by the Company of evidence reasonably satisfactory to it of
          the loss, theft, destruction or mutilation of this Warrant and, in the case of
          loss, theft or destruction, of such bond or indemnification as the Company may
          reasonably require, and, in the case of such mutilation, upon surrender and
          cancellation of this Warrant, the Company will execute and deliver a new Warrant
          of like tenor. 

         7.       
          Ownership of Warrant.   The Company may deem and treat the Person in whose
          name this Warrant is registered as the holder and owner hereof (notwithstanding
          any notations of ownership or written hereon made by anyone other than the
          Company) for all purposes and shall not be affected by any notice to the
          contrary, until presentation of this Warrant for registration of transfer. 

         8.       
          Amendments.   Any provision of this Warrant may be amended and the
          observance thereof waived only with the written consent of the Company and the
          Warrantholder. 

         9.       
          Definitions. As used herein, unless the context otherwise requires, the
          following terms have the following respective meanings: 

        
        “Board
of Directors” means the Board of Directors of the Company. 

         
       “Business
Day” means any day other than a Saturday, Sunday or other day on which commercial
banks in the State of York are authorized or required by law or executive order to close. 

         
       “Capital
Stock” means, with respect to any Person, any and all shares, interests,
participations, rights in, or other equivalent (however designated and whether voting or
non-voting) of such Person’s capital stock and any and all rights, warrants or
options exchangeable for or convertible into such capital stock (but excluding any debt
security whether or not it is exchangeable for or convertible into such capital stock). 

               
 “Common
Stock” means the Common Stock, par value $0.01 per share, of the Company. 

8

	

        
         “Common Stock
Equivalent”
 means any security or obligation other than Company’s Series E
Junior Convertible Preferred Stock which is by its terms convertible into or exercisable
into shares of Common Stock, including, without limitation, any option, warrant or other
subscription or purchase right with respect to Common Stock. 

       
         “Company”
has the meaning set forth in the first paragraph of this Warrant. 

        
        “Conversion
Rights” has the meaning set forth in Section 2.2(a) of this Warrant. 

        
        “Current
Market Price” means, as of the date of determination, (a) the average of the
daily Market Price under clause (a), (b) or (c) of the definition thereof of the Common
Stock during the immediately preceding thirty (30) trading days ending on such date, and
(b) if the Common Stock is not then listed or admitted to trading on any national
securities exchange or quoted in the over-the-counter market, then the Market Price under
clause (d) of the definition thereof on such date. 

        
        “Excluded
Transaction” means (a) any issuance or grant (“award”) of shares of
stock, restricted stock or options to purchase shares of Common Stock as compensation, or
as a pre-employment award, to employees, officers, directors or consultants of the Company
or of any Subsidiary of the Company, provided that if at the time of such award the
number of shares of Common Stock awarded and the number of shares of Common Stock issuable
upon exercise of the stock option awarded, when combined with all other shares of Common
Stock issued or issuable pursuant to awards made pursuant to this clause (a) during the
Exercise Period (i.e., excluding the Lund and Regal management awards and other awards
existing on the date hereof) exceeds 5% of the fully diluted shares of Common Stock
outstanding on the date of such award, then the new award shall not be deemed an Excluded
Transaction, (b) any issuance of Warrant Shares, (c) any issuance of securities as part of
the consideration in a merger or consolidation of the Company in which the Company is the
surviving corporation and there has been no change in the terms of the Common Stock, (d)
the issuance of up to 27,000,000 shares of Common Stock by the Company to acquire IFS of
New Jersey, Inc. (including shares of Common Stock issued upon mandatory conversion of the
Series E Junior Convertible Preferred Stock of the Company), (e) the issuance of up to
16,000,000 shares of Common Stock to investors in a private placement pursuant to
subscription agreements on or before the date hereof, (f) the issuance of up to 900,000
shares of Common Stock by the Company to Allen & Company Incorporated in partial
satisfaction of its fee in connection with the issuance referred to in clause (e) above,
(g) the issuance of any shares of the Company’s Series E Junior Convertible Preferred
Stock in connection with the Company’s acquisition of IFS of New Jersey, Inc., (h)
the issuance and the exercise of this Warrant and/or the Other Warrant, (i) the grant of
additional warrants to the holder of the Other Warrant in the event of an anti-dilution
adjustment pursuant to Section 5 of the Other Warrant, and (j) the issuance of any
“Equity Securities” (as defined in Section 7 of the Certificate of Designations)
of the Company, the proceeds of which are used to the extent required or permitted by
Section 7 of the Certificate of Designations. 

        
        “Exercise
Form” means an Exercise Form in the form annexed hereto as Exhibit A. 

        
        “Exercise Period”
means the period from January 14, 2003 to January 13, 2008. 

9

	

        
        “Exercise
Price” has the meaning set forth in the first paragraph of this Warrant. 

        
        “Fair
Market Value” means on any date of determination with respect to any shares of
Common Stock, an amount equal to the product of (i) the fair market value on such date of
the consolidated net worth of the Company, as determined in good faith by the Board of
Directors and (ii) the percentage such shares of Common Stock represent of all the then
outstanding shares of Common Stock. 

        
        “Issue
Date” has the meaning set forth in Section 5.2 of this Warrant. 

        
        “Market
Price” means, as of the date of determination, (a) if the Common Stock is listed
on a national securities exchange, the closing price per share of Common Stock on such
date published in The Wall Street Journal (National Edition) or, if no such
closing price on such date is published in The Wall Street Journal (National
Edition), the average of the closing bid and asked prices on such date, as officially
reported on the principal national securities exchange on which the Common Stock is then
listed or admitted to trading; or (b) if the Common Stock is not then listed or admitted
to trading on any national securities exchange but is designated as a national market
system security by the National Association of Securities Dealers, Inc., the last trading
price of the Common Stock on such date; or (c) if there shall have been no trading on such
date or if the Common Stock is not designated as a national market system security by the
National Association of Securities Dealers, Inc., the average of the reported closing bid
and asked prices of the Common Stock on such date as shown by the National Market System
of the National Association of Securities Dealers, Inc. Automated Quotations System and
reported by any member firm of the New York Stock Exchange selected by the Company; or (d)
if none of (a), (b) or (c) is applicable, a market price per share determined mutually by
the Board of Directors and the Majority Warrantholders or, if the Board of Directors and
the Majority Warrantholder shall fail to agree, at the Company’s expense by an
appraiser chosen by the Board of Directors and reasonably acceptable to the Majority
Warrantholders. Any determination of the Market Price by an appraiser shall be based on a
valuation of the Company as an entirety without regard to any discount for minority
interest or disparate voting rights among classes of capital stock. 

        
        “Majority
Warrantholders” means the holders of a majority of Warrant Shares issuable upon
exercise in full of both the Warrant and the Other Warrant assuming the exercise of all
such warrants. 

        
        “Person”
means any individual, firm, corporation, partnership, limited liability company, trust,
incorporated or unincorporated association, joint venture, joint stock company,
governmental body or other entity of any kind. 

        
        “New
Issuance” has the meaning set forth in Section 5.2 of this Warrant. 

        
        “New Issue
Price” has the meaning set forth in Section 5.2 of this Warrant. 

        
        “Relevant
Date” has the meaning set forth in Section 5.2 of this Warrant. 

10

	

        
        “Sale
Transaction” shall mean (a)(i) the merger or consolidation of the Company into or
with one or more Persons, (ii) the merger or consolidation of one or more Persons into or
with the Company or (iii) a tender offer or other business combination if, in the case of
(i), (ii) or (iii), the stockholders of the Company prior to such merger or consolidation
do not retain at least a majority of the voting power of the surviving Person or (b) the
voluntary sale, conveyance, exchange or transfer to another Person of (i) the voting
Capital Stock of the Company if, after such sale, conveyance, exchange or transfer do not
retain at least a majority of the voting power of the Company or (ii) all or substantially
all of the assets of the Company. 

        
        “Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations
of the Securities and Exchange Commission thereunder. 

        
        “Spin-off
Entity” has the meaning set forth in Section 5.8 of this Warrant. 

        
        “Transaction”
has the meaning set forth in Section 5.8 of this Warrant. 

        
        “Warrant
Shares” has the meaning set forth in the first paragraph of this Warrant. 

        
        “Warrant Share
Number” has the meaning set forth in Section 5.1 of this Warrant. 

        
        “Warrantholder”
has the meaning set forth in first paragraph of this Warrant. 

      10.    
Miscellaneous. 

       10.1    
Entire   Agreement.     This  Warrant  and  the  Registration   Rights  Agreement
constitute the entire agreement between the Company and the Warrantholder with respect to
this Warrant and supersedes all prior agreements and understanding with respect to the
subject matter of this Warrant.  

       10.2
    Binding  Effect;  Benefits.    This  Warrant  shall  inure to the  benefit of and shall
be binding upon the Company and the Warrantholder and their respective permitted
successors and assigns. Nothing in this Warrant, expressed or implied, is intended to or
shall confer on any person other than the Company and the Warrantholder, or their
respective permitted successors or assigns, any rights, remedies, obligations or
liabilities under or by reason of this Warrant.  

       10.3
    Headings.    The heading in this Warrant are for  convenience  of reference  only and
shall not limit or otherwise affect the meaning of this Warrant.  

       10.4
    Notices.   All  notices,  demands  and  other  communications  provided  for  or
permitted hereunder shall be made in writing and shall be by registered or certified
first-class mail, return receipt requested, telecopier, courier, service or personal
delivery:  

11

		
	    
     
         (a)  
if to the Company:	
	      
     
                
	     
                      Eos International, Inc.
	       
                   
 888 Seventh Avenue
	       
                   
 New York, New York 10106
	       
                   
 Telecopy: 212-554-9873
	       
                   
 Attention:  James M. Cascino,
	       
                   
                    
Chief Executive Officer
	                  
	                  with a copy to:
	                  
	                           Pitney, Hardin, Kipp & Szuch LLP
	                           Park Avenue at Morris County
	                           P.O. Box 1945
	                           Morristown, New Jersey 07962
	                           Telecopy:  973-966-1550	
	                           Attention:   Frank E. Lawatsch, Esq.
	                  
	        
          (b)   if to the Warrantholder, at its address as it appears
                           on the record books of the Company.	
	                  
	                  with a copy to:
	                  
	                           Paul, Weiss, Rifkind, Wharton & Garrison
	                           1285 Avenue of the Americas
	                           New York, New York 10019-6064
	                           Telecopy:  (212) 757-3990
	                           Attention:   Carl Reisner, Esq.
	                  	 
	                  	 
	 
	 

	

        All
such notices, demands and other communications shall be deemed to have been duly given
when delivered by hand, if personally delivered; when delivered by courier, if delivered
by commercial courier service, five (5) Business Days after being deposited in the mail,
postage prepaid, if mailed; and when receipt is mechanically acknowledged, if telecopied.
Any party may by notice given in accordance with this Section 10.4 designated another
address or Person for receipt of notices hereunder. 

       10.5
    Severability.    Any  term or  provision  of this  Warrant  which is  invalid  or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the
extent of such invalidity or unenforceability without rendering invalid or unenforceable
the terms and provisions of this Warrant or affecting the validity or enforceability of
any terms or provisions of this Warrant in any other jurisdiction.  

       10.6
    Governing  Law.    This Warrant  shall be governed by and construed in accordance with
the laws of the State of Delaware without regard to the conflict of law principle
thereof.  

12

	

       10.7
    No Rights or Liabilities  as  Stockholders.   Nothing  contained in this Warrant shall
be determined as conferring upon the Warrantholder any rights as a stockholder of the
Company or as imposing any liabilities on the Warrantholder to purchase any securities
whether such liabilities are asserted by the Company or by creditors or stockholders of
the Company as otherwise.  

[Remainder
of this page intentionally left blank] 

13

	

        IN
WITNESS WHEREOF, the Company has caused this Warrant to be signed by its duly authorized
officer. 

	

Dated:   January 14, 2003		EOS INTERNATIONAL, INC.

By:  PETER A. LUND
——————————————

  Peter A. Lund

  Chairman
       

	

	

Exhibit A 

EXERCISE FORM 

(To
be executed upon exercise of this Warrant) 

        The
undersigned hereby irrevocably elects to exercise the right, represented by this Warrant,
to purchase ___________________ shares of Common Stock and herewith tenders payment for
such shares to the order of the Company in the amount of $___________________ [hereby
exercises its Conversion Rights] in accordance with the terms of this Warrant. The
undersigned requests that a certificate for such Warrant Shares be registered in the name
of the undersigned and that such certificates be delivered to the undersigned’s
address below. 

        The
undersigned represents that it is acquiring such shares for its own account for investment
and not with a view to or for sale in connection with any distribution thereof (subject,
however, to any requirement of law that the disposition thereof shall at all times be
within its control). 

			
	Dated:		Signature:  ____________________
			

			_____________________________

(Print Name)
			

			_____________________________

(Street Address)
			

			_____________________________

(City)                 (State)
       (Zip Code)

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