Document:

Exhibit 4.1 - 01

Exhibit 4.1

AMENDMENT NO. 2
This AMENDMENT NO. 2, dated as of September 25, 2012 (this “Agreement”), is entered into among DISCOVERY COMMUNICATIONS, LLC, a Delaware limited liability company (the “Borrower”), DISCOVERY COMMUNICATIONS, INC., a Delaware corporation (the “Guarantor”), each Lender a party hereto and BANK OF AMERICA, N.A., as administrative agent (in such capacity, the “Administrative Agent”) for the Lenders, Swing Line Lender and L/C Issuer.  Capitalized terms used in this Agreement without definition shall have the meanings provided in Article I.
PRELIMINARY STATEMENTS:
The Borrower, the Guarantor, the Lenders, the Administrative Agent, the Swing Line Lender and the L/C Issuer are parties to the Credit Agreement.
The Borrower and the Guarantor have requested that the Lenders agree to amend the Credit Agreement as hereinafter set forth.
The Lenders party to this Agreement are, on the terms and conditions stated below, willing to grant such request and to amend the Credit Agreement as hereinafter set forth.
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each party to this Agreement agrees, as follows:
ARTICLE I
DEFINITIONS

1.01    Definitions.  The following terms (whether or not underscored) when used in this Agreement, including its preamble and recitals, shall have the following meanings (such definitions to be equally applicable to the singular and plural forms thereof): 
“Administrative Agent” is defined in the preamble.
“Agreement” is defined in the preamble.
“Agreement Effective Date” means the date on which the conditions precedent to the effectiveness of this Agreement as specified in Article III herein have been satisfied.
“Borrower” is defined in the preamble.
“Credit Agreement” means the Credit Agreement dated as of October 13, 2010, among the Borrower, the Guarantor, the Lenders, the Administrative Agent, the Swing Line Lender and the L/C Issuer, as amended by that certain Amendment No. 1 dated as of August 8, 2011, among the Borrower, the Guarantor, the Lenders, the Administrative Agent, the Swing Line Lender and the L/C Issuer.
“Lender” means each lender from time to time party to the Credit Agreement.  
“Guarantor” is defined in the preamble.
1.02    Other Definitions.  Unless otherwise defined herein or the context otherwise requires, terms used in this Agreement, including its preamble and recitals, have the meanings provided in the Credit Agreement.
  
1.03    Other Interpretive Provisions.  The rules of construction in Sections 1.02 to 1.09 of the Credit Agreement shall be equally applicable to this Agreement.  

1
Amendment No. 2

ARTICLE II
AMENDMENTS

2.01    Amendments.  Effective as of the Agreement Effective Date, the Credit Agreement is hereby amended as follows:
(a)Credit Agreement Section 1.01.  Section 1.01 of the Credit Agreement is amended as follows:
(i)Existing Definitions.  The existing definitions in Section 1.01 of the Credit Agreement for the terms “Applicable Rate” and “Maturity Date” are deleted in their entirety and the following new definitions for such terms are added in lieu thereof:
““Applicable Rate” means, from time to time, the following percentages per annum, based upon the Debt Rating as set forth below:  
Applicable Rate
	
					
	Pricing Level
	Debt Ratings S&P/Moody's
	Facility Fee
	Applicable Margin for LIBOR Loans;
Letter of Credit
Fee 
	Applicable Margin for Base Rate Loans and
Swing Line Loans

	1
	A-/A3 or better
	10.0 bps
	77.5 bps
	0.0 bps

	2
	BBB+/Baa1
	12.5 bps
	87.5 bps
	0.0 bps

	3
	BBB/Baa2
	15.0 bps
	110.0 bps
	10.0 bps

	4
	BBB-/Baa3
	20.0 bps
	130.0 bps
	30.0 bps

	5
	BB+/Ba1 or worse
	30.0 bps
	145.0 bps
	45.0 bps

“Debt Rating” means, as of any date of determination, the rating as determined by either S&P or Moody's (collectively, the “Debt Ratings”) of the Borrower's non-credit-enhanced, senior unsecured long-term debt; provided that (a) if the respective Debt Ratings issued by the foregoing rating agencies differ by one level, then the Pricing Level for the higher of such Debt Ratings shall apply (with the Debt Rating for Pricing Level 1 being the highest and the Debt Rating for Pricing Level 5 being the lowest); (b) if there is a split in Debt Ratings of more than one level, then the Pricing Level that is one level lower than the Pricing Level of the higher Debt Rating shall apply; (c) if the Borrower has only one Debt Rating, the Pricing Level that is one level lower than that of such Debt Rating shall apply; and (d) if the Borrower does not have any Debt Rating, Pricing Level 5 shall apply.
Initially, the Applicable Rate following the Amendment No. 2 Effective Date shall be determined based upon the Debt Rating specified in the certificate delivered pursuant to Section 3.01(a)(ii) of Amendment No. 2.  Thereafter, each change in the Applicable Rate resulting from a publicly announced change in the Debt Rating shall be effective, in the case of an upgrade, during the period commencing on the date of delivery by the Borrower to the Administrative Agent of notice thereof pursuant to Section 6.03(d) and ending on the date immediately preceding the effective date of the next such change and, in the case of a downgrade, during the period commencing on the date of the public announcement thereof and ending on the date immediately preceding the effective date of the next such change.
“Maturity Date” means October 12, 2017; provided, however, if such date is not a Business Day, the Maturity Date shall be the next preceding Business Day.”
(ii)New Definitions.  The following new definitions are added to Section 1.01 of the Credit Agreement in the appropriate alphabetic order:
““Amendment No. 2 Effective Date” shall mean the Agreement Effective Date (as such term is defined in Amendment No. 2).
“Amendment No. 2” means that certain Amendment No. 2 dated as of September 25, 2012, among the Borrower, the Guarantor, the Lenders party thereto, the Administrative Agent, the Swing Line Lender and the L/C Issuer.”
(b)Credit Agreement Section 5.05(c).  Section 5.05(c) of the Credit Agreement is deleted in its entirety and the following new Section 5.05(c) is added in lieu thereof:

2
Amendment No. 2

“(c)    As of the Amendment No. 2 Effective Date, there has been no event or circumstance, either individually or in the aggregate, that has had or could reasonably be expected to have a Material Adverse Effect.”
(c)Loan Documents.  From and after the Agreement Effective Date, each reference to the Credit Agreement in any Loan Document shall be a reference to the Credit Agreement, as amended by this Agreement, as the same may hereafter be further amended, amended and restated, supplemented or otherwise modified.
2.02    Guarantor Acknowledgement.  (a)  The Guarantor consents and agrees to the terms of (i) this Agreement and (ii) the Credit Agreement, as amended and otherwise modified by this Agreement.
(b)    The Guarantor confirms and agrees that notwithstanding the effectiveness of this Agreement, the Guaranty is, and shall continue to be, in full force and effect and is hereby ratified and confirmed in all respects, except that, on and after the effectiveness of this Agreement, each reference in the Guaranty to the “Credit Agreement”, “hereunder”, “hereof” or words of like import shall mean and be a reference to the Credit Agreement, as amended and otherwise modified by this Agreement.

ARTICLE III
CONDITIONS PRECEDENT

3.01    Conditions of Effectiveness.  This Agreement is subject to the provisions of Section 11.01 of the Credit Agreement, and shall become effective when, and only when, each of the following conditions shall have been satisfied:
(a)    Deliveries.  The Administrative Agent shall have received all of the following documents (in sufficient copies for each Lender), each such document (unless otherwise specified) dated the date of receipt thereof by the Administrative Agent and, each in form and substance reasonably satisfactory to the Administrative Agent: 
(i)Agreement.  Counterparts of this Agreement executed by the Borrower, the Guarantor and all of the Lenders or, as to any of the Lenders, advice satisfactory to the Administrative Agent that such Lender has executed this Agreement;
(ii)Responsible Officer's Certificates.  From each Loan Party, a certificate executed by a Responsible Officer of such Loan Party as to the matters set forth in Section 3.01(c) and certifying the current Debt Ratings;
(iii)Secretary's Certificates.  From each Loan Party, a certificate completed and executed by the Secretary or Assistant Secretary of such Loan Party certifying as to the matters certified by such officer on the Closing Date pursuant to Section 4.01(a)(iii) of the Credit Agreement, including, without limitation, as to a copy of the resolutions of such Loan Party authorizing its execution and delivery of Amendment No. 2 and its performance of its obligations under Amendment No.2 and the Credit Agreement, as amended by Amendment No. 2, and as to the incumbency and specimen signatures of the officers of such Loan Party authorized to execute and deliver Amendment No. 2 on behalf of such Loan Party; and
(iv)Opinion.  A favorable opinion of WilmerHale, counsel to the Loan Parties, addressed to the Administrative Agent and each Lender, in substantially the form of the opinion delivered by such counsel to the Administrative Agent and the Lenders on the Closing Date under Section 4.01(a)(v) of the Credit Agreement; 
(b)    Fees; Expenses.  The Administrative Agent shall have received payment of the following:  (i) for the account of each Lender which has executed a counterpart of this Agreement, a fee equal to 0.10% of the Commitment of such Lender; (ii) for the account of each Arranger, the fee due to such Arranger pursuant to that certain fee letter dated the date hereof among the Loan Parties and such Arranger; and (iii) for the account of the Administrative Agent, the amount of any fees and expenses required to be reimbursed on or before the Agreement Effective Date pursuant to Section 5.04 hereof; and
(c)    Representations and Warranties.  The representations and warranties of the Borrower and the Guarantor contained in Article IV should be true and correct in all material respects.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES

In order to induce the Lenders to enter into this Agreement, the Borrower and the Guarantor hereby represent and warrant that on and as of the Agreement Effective Date after giving effect to this Agreement:
4.01    Due Authorization; No Conflict.  The execution and delivery by the Borrower and the Guarantor of this Agreement and the performance by the Borrower and the Guarantor of this Agreement and the Credit Agreement, as amended and otherwise modified by this Agreement, have been duly authorized by all necessary corporate or other organizational action of the 

3
Amendment No. 2

Borrower and the Guarantor, and do not and will not: (a) contravene the terms of the Borrower's or the Guarantor's Organizational Documents; (b) conflict with or result in any breach or contravention of, or the creation of any Lien under, or require any payment to be made under (i) any Contractual Obligation to which the Borrower or the Guarantor is a party or affecting the Borrower, the Guarantor or any properties of the Borrower or the Guarantor or (ii) any order, injunction, writ or decree of any Governmental Authority or any arbitral award to which the Borrower or the Guarantor or any of their property is subject; or (c) violate any Law to which the Borrower or the Guarantor or any of their property is subject, except in each case referred to in clause (b) or (c), to the extent that such conflict or violation could not reasonably be expected to have a Material Adverse Effect.
4.02    Enforceability.  Each of this Agreement and the Credit Agreement, as amended and otherwise modified by this Agreement, constitutes a legal, valid and binding obligation of the Borrower and the Guarantor, enforceable against the Borrower and the Guarantor in accordance with its terms, except as enforceability may be limited by applicable Debtor Relief Laws and by general principles of equity, regardless of whether considered in a proceeding in equity or at law.
4.03    Credit Agreement Representations.  The representations and warranties of the Borrower and the Guarantor contained in the Credit Agreement are true and correct in all material respects except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects as of such earlier date.
4.04    No Default.  No Default or Event of Default has occurred and is continuing or resulted from the consummation of the transactions contemplated by this Agreement.
ARTICLE V
MISCELLANEOUS

5.01    Loan Document.  This Agreement is a Loan Document executed pursuant to the Credit Agreement and shall (unless otherwise expressly indicated herein) be construed, administered and applied in accordance with the terms and provisions thereof.  
5.02    Lender Consent.  For purposes of determining compliance with the conditions specified in Section 3.01, each Lender that has signed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter required hereunder to be consented to or approved by or acceptable or satisfactory to a Lender unless the Administrative Agent shall have received notice from such Lender prior to the proposed Agreement Effective Date specifying its objection thereto.
5.03    Effect of Agreement.  (a) The Credit Agreement, as specifically amended or otherwise modified by this Agreement, is and shall continue to be in full force and effect and is hereby in all respects ratified and confirmed.  Upon the effectiveness hereof, each reference to the Credit Agreement in the Credit Agreement or any other Loan Document shall mean and be a reference to the Credit Agreement as amended hereby. 
(b)    The execution, delivery and effectiveness of this Agreement shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of any Lender or the Administrative Agent under any of the Loan Documents.
5.04    Costs and Expenses.  On the Agreement Effective Date, the Borrower agrees to pay all reasonable, documented out of pocket costs and expenses of the Administrative Agent in connection with the preparation, execution and delivery of this Agreement and the other instruments and documents to be delivered hereunder (including, without limitation, the reasonable fees and expenses of counsel for the Administrative Agent) in accordance with the terms of Section 11.04(a) of the Credit Agreement which are invoiced to the Borrower on or prior to the Agreement Effective Date.
5.05    Section Captions.  Section captions used in this Agreement are for convenience of reference only, and shall not affect the construction of this Agreement.
5.06    Counterparts.  This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same instrument.  Delivery of an executed counterpart of a signature page of this Agreement by telecopy or other electronic means shall be effective as delivery of a manually executed counterpart of this Agreement.
5.07    Governing Law.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.  
[Signature Page Follows]

4
Amendment No. 2

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written.
BORROWER:                            DISCOVERY COMMUNICATIONS, LLC

By:  /s/  Eugenia Collis                
Name:     Eugenia Collis
Title:    Senior Vice President and Treasurer    

GUARANTOR:                            DISCOVERY COMMUNICATIONS, INC.

By:  /s/  Eugenia Collis                
Name:     Eugenia Collis
Title:    Senior Vice President and Treasurer    
            

Signature Page
Amendment No. 2

ADMINISTRATIVE AGENT:                    BANK OF AMERICA, N.A.,
as Administrative Agent

By:  /s/  Maurice E. Washington            
Name:     Maurice E. Washington    
Title:    Vice President        

Signature Page
Amendment No. 2

LENDERS:    BANK OF AMERICA, N.A., as L/C Issuer,
as Swing Line Lender and as a Lender 

By:  /s/  Jay D. Marquis                
Name:     Jay D. Marquis    
Title:    Director        

Signature Page
Amendment No. 2

JPMORGAN CHASE BANK, N.A. 

By:  /s/  Tina Ruyter                
Name:     Tina Ruyter    
Title:    Executive Director        

Signature Page
Amendment No. 2

THE ROYAL BANK OF SCOTLAND PLC

By:  /s/  Matthew Pennachio            
Name:     Matthew Pennachio    
Title:    Director            

Signature Page
Amendment No. 2

CITIBANK N.A. 

By:  /s/  Keith Lukasavich            
Name:     Keith Lukasavich    
Title:    Vice President        

Signature Page
Amendment No. 2

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH 

By:  /s/  Christopher Reo Day            
Name:     Christopher Reo Day    
Title:    Vice President

By:  /s/  Tyler R. Smith                
Name:     Tyler R. Smith    
Title:       Associate

Signature Page
Amendment No. 2

BNP PARIBAS 

By:  /s/  Barbara Nash                
Name:      Barbara Nash    
Title:    Managing Director        

BNP PARIBAS 

By:  /s/  Maria Mulic                
Name:    Maria Mulic
Title:    Vice President
    

Signature Page
Amendment No. 2

CREDIT AGRICOLE CORPORATE AND INVESTMENT BANK 

By:  /s/  Kestrina Budina                
Name:     Kestrina Budina    
Title:    Director        

By:  /s/  Elvis Grgurovic                
Name:     Elvis Grgurovic    
Title:       Director    

Signature Page
Amendment No. 2

GOLDMAN SACHS BANK USA 

By:  /s/  Mark Walton                
Name:     Mark Walton    
Title:    Authorized Signatory        

Signature Page
Amendment No. 2

ROYAL OF BANK OF CANADA 

By:  /s/  Alfonse Simone                
Name:     Alfonse Simone    
Title:    Authorized Signatory        

Signature Page
Amendment No. 2

SUNTRUST BANK 

By:  /s/  Cynthia Burton                
Name:     Cynthia Burton
Title:     Vice President         

Signature Page
Amendment No. 2

THE BANK OF NOVA SCOTIA 

By:  /s/  Steven Kerr                
Name:     Steven Kerr    
Title:    Managing Director    
    

Signature Page
Amendment No. 2

WELLS FARGO BANK, NATIONAL ASSOCIATION 

By:  /s/  James Travagline            
Name:     James Travagline    
Title:     Director        

Signature Page
Amendment No. 2

MORGAN STANLEY BANK, N.A. 

By:  /s/  Kelly Chin                
Name:     Kelly Chin    
Title:    Authorized Signatory    
    

Signature Page
Amendment No. 2

THE BANK OF TOKYO-MITSUBISHI UFJ, LTD. 

By:  /s/  Jose Carlos                
Name:     Jose Carlos    
Title:    Director        

Signature Page
Amendment No. 2ex4-1.htm

Exhibit 4.1

 

THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF OR IN ACCORDANCE WITH APPLICABLE LAW.

WARRANT TO PURCHASE STOCK

 

 

	Corporation:  	ACCELERIZE NEW MEDIA, INC.
	Number of Shares:	See below.
	Class of Stock:	Common
	Initial Exercise Price: 	See below.
	Issue Date:  	September 27, 2012
	Expiration Date:  	August 23, 2016

                                                                                                                                                                                                  

THIS WARRANT CERTIFIES THAT AGILITY CAPITAL II, LLC or registered assignee (“Holder”) is entitled to purchase the number of fully paid and nonassessable shares (the “Shares”) of Common Stock of ACCELERIZE NEW MEDIA, INC. (the “Company”), in the number, at the price, and for the term specified above.  The number of Shares that may be purchased is equal to 650,000.  The Warrant Price is equal to the lower of (i) $0.35 and (ii) the price per share at which the Company sells or issues its capital stock after the Issue Date in a transaction or series of transactions in which the Company receives at least $500,000, provided that such price per share shall in no case be less the price per share of the Company’s Series B Preferred Stock including any adjustments provided for therein.

 

ARTICLE 1.           EXERCISE

 

1.1           Method of Exercise.  Holder may exercise this Warrant by delivering this Warrant and a duly executed Notice of Exercise in substantially the form attached as Appendix 1 to the principal office of the Company.  Unless Holder is exercising the conversion right set forth in Section 1.2, Holder shall also deliver to the Company a check for the aggregate Warrant Price for the Shares being purchased.

 

1.2           Conversion Right.  In lieu of exercising this Warrant as specified in Section 1.1, Holder may from time to time convert this Warrant, in whole or in part, into a number of Shares determined by dividing (a) the aggregate fair market value of the Shares or other securities otherwise issuable upon exercise of this Warrant minus the aggregate Warrant Price of such Shares by (b) the fair market value of one Share.  The fair market value of the Shares shall be determined pursuant to Section 1.3.

 

1.3           Fair Market Value.  The fair market value of the Shares shall be the closing price of the Shares reported for the business day immediately before Holder delivers its Notice of Exercise to the Company.

 

1.4           Delivery of Certificate and New Warrant.  Promptly after Holder exercises or converts this Warrant, the Company shall deliver to Holder certificates for the Shares acquired and, if this Warrant has not been fully exercised or converted and has not expired, a new Warrant representing the Shares not so acquired.

 

1.5           Replacement of Warrants.  On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of loss, theft or destruction, on delivery of an indemnity agreement reasonably satisfactory in form and amount to the Company or, in the case of mutilation, or surrender and cancellation of this Warrant, the Company at its expense shall execute and deliver, in lieu of this Warrant, a new warrant of like tenor.

 

ARTICLE 2.           ADJUSTMENTS TO THE SHARES.

 

2.1           Stock Dividends, Splits, Etc.  If the Company declares or pays a dividend on its common stock payable in common stock, or other securities, subdivides the outstanding common stock into a greater amount of common stock, then upon exercise of this Warrant, for each Share acquired, Holder shall receive, without cost to Holder, the total number and kind of securities to which Holder would have been entitled had Holder owned the Shares of record as of the date the dividend or subdivision occurred.

 

  

  

  

 

2.2           Reclassification, Exchange or Substitution.  Upon any reclassification, exchange, substitution, or other event that results in a change of the number and/or class of the securities issuable upon exercise or conversion of this Warrant, Holder shall be entitled to receive, upon exercise or conversion of this Warrant, the number and kind of securities and property that Holder would have received for the Shares if this Warrant had been exercised immediately before such reclassification, exchange, substitution, or other event.

 

2.3           Adjustments for Combinations, Etc.  If the outstanding Shares are combined or consolidated, by reclassification or otherwise, into a lesser number of shares, the Warrant Price shall be proportionately increased.

 

2.4           Price Adjustment.  If the Company issues additional common shares (including shares of common stock ultimately issuable upon conversion of a security convertible into common stock) after the date of the Warrant and the consideration per additional common share is less than the Warrant Price in effect immediately before such issue, the Warrant Price shall be reduced, concurrently with such Issue, to such lower price.  Upon each adjustment of the Warrant Price, the number of Shares issuable upon exercise of the Warrant shall be increased to equal the quotient obtained by dividing (a) the product resulting from multiplying (i) the number of Shares issuable upon exercise of the Warrant and (ii) the Warrant Price, in each case as in effect immediately before such adjustment, by (b) the adjusted Warrant Price.  Notwithstanding any provision of this Section 2.4, neither the Warrant Price nor the number of Shares shall be adjusted for any options issued to employees, directors, or officers under any stock option plan of the Company.

 

2.5           Loan Default.  Upon the occurrence of an Event of Default under the Loan Agreement between the Company and the Holder dated as of the January 3, 2011, and amended from time to time (the “Loan Agreement”) and notice to the Company, the number of Shares that Holder may acquire under this Warrant shall increase by 50,000, and shall increase by an additional 75,000 Shares on the thirtieth day thereafter, and on each thirtieth day after that for so long as the Event of Default is continuing, up to a maximum additional Shares of 350,000.  The Warrant Price from and after the occurrence of an Event of Default shall be the lesser of (a) the Warrant Price that would otherwise be applicable and (b) the average closing price of Borrower’s common stock for the 15 day period immediately prior to such occurrence.

 

2.6           No Impairment.  The Company shall not, by amendment of its Certificate of Incorporation or through a reorganization, transfer of assets, consolidation, merger, dissolution, issue, or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed under this Warrant by the Company, but shall at all times in good faith assist in carrying out all the provisions of this Article 2 and in taking all such action as may be necessary or appropriate to protect Holder’s rights under this Article against impairment.  If the Company takes any action affecting the Shares or its common stock other than as described above that adversely affects Holder’s rights under this Warrant, the Warrant Price shall be adjusted downward and the number of Shares issuable upon exercise of this Warrant shall be adjusted upward in such a manner that the aggregate Warrant Price of this Warrant is unchanged.

 

2.7           Certificate as to Adjustments.  Upon each adjustment of the Warrant Price, the Company at its expense shall promptly compute such adjustment, and furnish Holder with a certificate of its Chief Financial Officer setting forth such adjustment and the facts upon which such adjustment is based.  The Company shall, upon written request, furnish Holder a certificate setting forth the Warrant Price in effect upon the date thereof and the series of adjustments leading to such Warrant Price.

 

ARTICLE 3.           REPRESENTATIONS AND COVENANTS OF THE COMPANY.

 

3.1           Representations and Warranties.  The Company hereby represents and warrants to the Holder that all Shares that may be issued upon the exercise of the purchase right represented by this Warrant, shall, upon issuance, be duly authorized, validly issued, fully paid and nonassessable, and free of any liens and encumbrances except for restrictions on transfer provided for herein or under applicable federal and state securities laws.

 

  

2

  

 

3.2           Notice of Certain Events.  If the Company proposes at any time (a) to declare any dividend or distribution upon its common stock, whether in cash, property, stock, or other securities and whether or not a regular cash dividend; (b) to offer for subscription pro rata to the holders of any class or series of its stock any additional shares of stock of any class or series or other rights; (c) to effect any reclassification or recapitalization of common stock; (d) to merge or consolidate with or into any other corporation, or sell, lease, license, or convey all or substantially all of its assets, or to liquidate, dissolve or wind up unless the Company shall be the Surviving Entity; or (e) offer holders of registration rights the opportunity to participate in an underwritten public offering of the company’s securities for cash (except to the extent such offer occurs within 30 days of the Issue Date of this Warrant), then, in connection with each such event, the Company shall give Holder (1) at least 20 days prior written notice of the date on which a record will be taken for such dividend, distribution, or subscription rights (and specifying the date on which the holders of common stock will be entitled thereto) or for determining rights to vote, if any, in respect of the matters referred to in (a) and (b) above; (2) in the case of the matters referred to in (c) and (d) above at least 20 days prior written notice of the date when the same will take place (and specifying the date on which the holders of common stock will be entitled to exchange their common stock for securities or other property deliverable upon the occurrence of such event); and (3) in the case of the matter referred to in (e) above, the same notice as is given to the holders of such registration rights.

 

3.3           Registration Rights. The Shares, or the common stock into which the Shares are convertible, shall be “Registrable Securities”, and Holder shall have the rights of a “Holder” in respect of piggyback and S-3 registrations under such registration rights agreement or investor rights agreement as may be entered into from time to time among the Company and the Purchasers named therein.

 

3.4           Information Rights.  So long as the Holder holds this Warrant and/or any of the Shares, the Company shall deliver to the Holder (a) within one hundred twenty (120) days after the end of each fiscal year of the Company, the annual audited financial statements of the Company certified by independent public accountants of recognized standing and (b) within forty-five (45) days after the end of each of the first three quarters of each fiscal year, the Company’s quarterly, unaudited financial statements, provided Company need not provide such information for any period in which Company has filed Form 10Q with the Securities and Exchange Commission.

 

ARTICLE 4.           MISCELLANEOUS.

 

4.1           Term.  This Warrant is exercisable, in whole or in part, at any time and from time to time on or before the Expiration Date set forth above.

 

4.2           Legends.  This Warrant and the Shares (and the securities issuable, directly or indirectly, upon conversion of the Shares, if any) shall be imprinted with a legend in substantially the following form:

 

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR IN ACCORDANCE WITH APPLICABLE LAW.

 

4.3           Compliance with Securities Laws on Transfer.  This Warrant and the Shares issuable upon exercise this Warrant (and the securities issuable, directly or indirectly, upon conversion of the Shares, if any) may not be transferred or assigned in whole or in part without compliance with applicable federal and state securities laws by the transferor and the transferee.

 

4.4           Transfer Procedure.  Subject to the provisions of Section 4.3, Holder may transfer all or part of this Warrant or the Shares issuable upon exercise of this Warrant (or the securities issuable, directly or indirectly, upon conversion of the Shares, if any) by giving the Company notice of the portion of the Warrant being transferred setting forth the name, address and taxpayer identification number of the transferee and surrendering this Warrant to the Company for reissuance to the transferee(s) (and Holder, if applicable), provided that no such notice shall be required for a transfer to an affiliate of Holder.

 

4.5           Notices.  All notices and other communications from the Company to the Holder, or vice versa, shall be deemed delivered and effective when given personally or mailed by first-class registered or certified mail, postage prepaid, at such address as may have been furnished to the Company or the Holder, as the case may be, in writing by the Company or such Holder from time to time.

 

  

3

  

 

4.6           Waiver.  This Warrant and any term hereof may be changed, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of such change, waiver, discharge or termination is sought.

 

4.7           Attorneys’ Fees.  In the event of any dispute between the parties concerning the terms and provisions of this Warrant, the party prevailing in such dispute shall be entitled to collect from the other party all costs incurred in such dispute, including reasonable attorneys’ fees.

 

4.8           Governing Law.  This Warrant shall be governed by and construed in accordance with the laws of the State of California, without giving effect to its principles regarding conflicts of law.

 

	  	  	
ACCELERIZE NEW MEDIA, INC.

	  	  	  
	  	  	  
	  	  	
By: /s/ Brian Ross

	  	  	  
	  	  	
Name: Brian Ross

	  	  	  
	  	  	
Title: Chief Executive Officer

	  	  	  

  

4

  

 

APPENDIX 1

 

NOTICE OF EXERCISE

 

1.           The undersigned hereby elects to purchase ______________ shares of the Common Stock of ACCELERIZE NEW MEDIA, INC. pursuant to the terms of the attached Warrant, and tenders herewith payment of the purchase price of such shares in full.

 

1.           The undersigned hereby elects to convert the attached Warrant into Shares in the manner specified in the Warrant.  This conversion is exercised with respect to ______________ of the Shares covered by the Warrant.

 

[Strike paragraph that does not apply.]

 

2.           Please issue a certificate or certificates representing said shares in the name of the undersigned or in such other name as is specified below:

 

Agility Capital II, LLC

____________________

____________________

Or Registered Assignee

 

3.           The undersigned represents it is acquiring the shares solely for its own account and not as a nominee for any other party and not with a view toward the resale or distribution thereof except in compliance with applicable securities laws.

 

	
Agility Capital II, LLC or Registered Assignee

	  	  
	  	  	  
	  	  	  
	  	  	  
	
(Signature)

	  	  
	  	  	  
	  	  	  
	  	  	  
	
(Date)

	  	  

 

2

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