UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
Date of
Report (Date of earliest event reported):
January 9, 2019
Bright Mountain Media, Inc.
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(Exact
name of registrant as specified in its charter)
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Florida
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000-54887
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27-2977890
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(State
or other jurisdiction of incorporation)
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(Commission
File Number)
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(IRS
Employer Identification No.)
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6400 Congress Avenue, Suite 2050, Boca Raton, Florida
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33487
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(Address
of principal executive offices)
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(Zip
Code)
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Registrant's telephone number, including area code:
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561-998-2440
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not applicable
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(Former
name or former address, if changed since last report)
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Check
the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant
under any of the following provisions (see General Instruction A.2.
below):
☐
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Written
communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
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☐
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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☐
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR 240.14d-2(b))
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☐
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR 240.13e-4(c))
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Indicate by check mark whether the registrant is an emerging growth
company as defined in in Rule 405 of the Securities Act of 1933
(
§230.405 of this chapter) or Rule 12b-2 of the
Securities Exchange Act of 1934 (§240.12b-2 of this
chapter)
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Emerging growth company
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☒
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If an
emerging growth company, indicate by checkmark if the registrant
has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided
pursuant to Section 13(a) of the Exchange Act. ☐
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Item 3.02
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Unregistered Sales of Equity Securities.
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Between
December 28, 2018 and January 9, 2019, Bright Mountain Media, Inc.
sold 3,000,000 units of our securities to 38 accredited investors
in a private placement exempt from registration under the
Securities Act in reliance on exemptions provided by Section
4(a)(2) and Rule 506(b) of Regulation D and Regulation S of the
Securities Act. The units (the “Units”) were sold at a
purchase price of $0.40 per Unit resulting in gross proceeds to us
of $1,200,000. Each unit consisted of one share of our common stock
and one five year common stock purchase warrant to purchase one
share of our common stock at an exercise price of $0.65 per share
(the “Private Placement Warrants”).
Spartan
Capital Securities, LLC (“Spartan Capital”), a
broker-dealer and member of FINRA, acted as exclusive placement
agent for us in this offering. We paid Spartan Capital a cash
commission of $120,000, a cash non-accountable expense allowance of
$40,000, and issued it five year placement agent warrants
(“Placement Agent Warrants”) to purchase an aggregate
of 300,000 shares of our common stock at an exercise price of $0.65
per share as compensation for its services. The Placement Agent
Warrants are exercisable on a cashless basis and we granted Spartan
Capital piggy back registration rights for the shares of our common
stock issuable upon the exercise of the Placement Agent
Warrants.
We used
$200,000 of the proceeds from this offering for the payment of the
fees due Spartan Capital under the terms of the Uplisting Advisory
and Consulting Agreement described below, and are using the balance
of $840,000 for general working capital.
We
granted Spartan Capital certain rights of first refusal if decide
to undertake a future private or public offering of securities or
if we decide to engage an investment banking firm within 36 months
from the closing date of the offering. These rights are in addition
to similar rights granted to Spartan Capital in connection with the
private offering that commenced in December 2017 and closed in
November 2018.
We
granted purchasers of the Units demand and piggy-back registration
rights with respect to the shares of our common stock included in
the Units and the shares of common stock issuable upon the exercise
of the Private Placement Warrants. In addition, we are obligated to
file a resale registration statement within 120 days following the
closing of this offering covering the shares of our common stock
issuable upon the exercise of the Private Placement Warrants. If we
should fail to timely file this resale registration statement, then
within five business days of the end of month we will pay the
holders an amount in cash, as partial liquidated damages, equal to
2% of the aggregate purchase price paid by the holder for each 30
days, or portion thereof, until the earlier of the date the
deficiency is cured or the expiration of six months from filing
deadline. We will keep any such registration statement effective
until the earlier of the date upon which all such securities may be
sold without registration under Rule 144 or the date which is six
months after the expiration of the Private Placement Warrants. We
are obligated to pay all costs associated with this registration
statement, other than selling expenses of the holders.
Additional terms of
the Private Placement Warrants include:
●
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the
exercise price is subject to adjustment in the event of certain
stock dividends and distributions, stock splits, stock
combinations, reclassifications or similar events affecting our
common stock and also upon any distributions of assets, including
cash, stock or other property to our shareholders;
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●
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if we
fail to timely file the resale registration statement described
above or at any time thereafter during the exercise period there is
not an effective registration statement registering such shares, or
the prospectus contained therein is not available for the issuance
of the such shares to the holder for a period of at least 60 days
following the delivery of a suspension notice (as described in the
Private Placement Warrants), then the Private Placement Warrants
may also be exercised, in whole or in part, at such time by means
of a “cashless exercise” in which case the holder would
receive upon such exercise the net number of shares of common stock
determined according to the formula set forth in the Private
Placement Warrants;
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●
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providing
that there is an effective registration statement registering the
shares of common stock issuable upon exercise of the Private
Placement Warrant, during the exercise period, upon 30 days prior
written notice to the holder following the date on which the last
sale price of our common stock equals or exceeds $1.50 per share
for 10 consecutive trading days, as may be adjusted for stock
splits, stock dividends and similar corporate events, if the
average daily trading volume of our common stock is not less than
30,000 shares during such 10 consecutive trading day period, we
have the right to call any or all of the Private Placement Warrants
at a call price of $0.01 per underlying share; and
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●
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a
holder will not have the right to exercise any portion of the
Private Placement Warrant if the holder (together with its
affiliates) would beneficially own in excess of 4.99% of the number
of shares of our common stock outstanding immediately after giving
effect to the exercise, as such percentage ownership is determined
in accordance with the terms of the Private Placement Warrants;
provided, however
, that any
holder may increase or decrease such percentage to any other
percentage not in excess of 9.99% upon at least 61 days’
prior notice from the holder to us.
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The
foregoing descriptions of the terms and conditions of the Private
Placement Warrants and Placement Agent Warrants are qualified in
their entirety by reference to the warrants which are filed as
Exhibit 4.1 and 4.2, respectively, to this Current Report on from
8-K.
On
December 11, 2018 we entered into an Uplisting Advisory and
Consulting Agreement with Spartan Capital pursuant to which Spartan
Capital will provide (i) advice and input with respect to
strategies to accomplish an uplisting of our common stock to the
Nasdaq Capital Market or NYSE American LLC or another national
securities exchange, and the implementation of such strategies and
making introductions to facilitate the uplisting, (ii) advice and
input with respect to special situation and restructuring services,
including debtor and creditor advisory services, and (iii)
sell-side advisory services with respect to the sale and
disposition of non-core businesses and assets, including
facilitating due diligence and identifying potential buyers and
strategic partners and positioning these businesses and assets to
maximize value. We paid Spartan Capital a fee of $200,000 for it
services under this agreement which is for a 12 month term
beginning on the closing date of the offering described earlier in
this Current Report on Form 8-K. The agreement also provides that
we will reimburse Spartan Capital for reasonable out-of-pocket
expenses, which we must approve in advance. The Uplisting Advisory
and Consulting Agreement contains customary confidentiality and
indemnification provisions. The foregoing description of the terms
and conditions of the Uplisting Advisory and Consulting Agreement
is qualified in its entirety by reference to the agreement which is
filed as Exhibit 10.1 to this Current Report on from
8-K.
Item 9.01
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Financial Statements and Exhibits.
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Incorporated by Reference
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Filed or
Furnished
Herewith
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No.
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Exhibit Description
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Form
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Date Filed
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Number
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4.1
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Form of
Private Placement Warrant
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Filed
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4.2
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Form of
Placement Agent Warrant
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Filed
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10.1
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Uplisting
Advisory and Consulting Agreement dated December 11, 2018 by and
between Spartan Capital Securities, LLC and Bright Mountain Media,
Inc.
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Filed
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SIGNATURES
Pursuant to the
requirements of the Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date:
January 14, 2018
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Bright
Mountain Media, Inc.
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By: /s/
W. Kip Speyer
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W. Kip
Speyer, Chief Executive Officer
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FORM OF COMMON STOCK PURCHASE WARRANT
THE SECURITIES EVIDENCED BY THIS WARRANT HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE
SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED
OR OTHERWISE DISPOSED OF WITHOUT (i) EFFECTIVE REGISTRATION
STATEMENT RELATED THERETO, (ii) AN OPINION OF COUNSEL OR OTHER
EVIDENCE, REASONABLY SATISFACTORY TO THE BRIGHT MOUNTAIN MEDIA,
INC., THAT SUCH REGISTRATION IS NOT REQUIRED, OR (iii) RECEIPT OF
NO-ACTION LETTERS FROM THE APPROPRIATE GOVERNMENTAL
AUTHORITIES.
December 28, 2018 No. W-__
BRIGHT MOUNTAIN MEDIA, INC.
COMMON STOCK PURCHASE WARRANT
This
certifies that, for good and valuable consideration, receipt of
which is hereby acknowledged, [●] (“
Holder
”)
is entitled to purchase, subject to the terms and conditions of
this Warrant, from Bright Mountain Media, Inc., a Florida
corporation (the “
Company
”),
[●] fully paid and nonassessable shares of the
Company’s common stock, par value $0.01 per share
(“
Common
Stock
”). Holder shall be entitled to purchase the
shares of Common Stock in accordance with
Section 2
at any time
subsequent to the date of this Warrant set forth above and prior to
the Expiration Date (as defined below). The shares of Common Stock
of the Company for which this Warrant is exercisable, as adjusted
from time to time pursuant to the terms hereof, are hereinafter
referred to as the “
Shares
.”
This Warrant is one of a series of Warrants included in the Units
issued and sold pursuant to the terms and conditions of the
Company’s Confidential Private Offering Memorandum for
Accredited Investors dated December 13, 2018 and the exhibits (the
“
Offering
Documents
”), as may be supplemented from time to
time.
1.
Exercise
Period; Price
.
1.1
Exercise
Period
. This Warrant shall be immediately exercisable and
the exercise period (“
Exercise
Period
”) shall terminate at 5:00 p.m. Eastern time on
December 28, 2023 (the “
Expiration
Date
”).
1.2
Exercise
Price
. The initial purchase price for each of the Shares
shall be $0.65 per share. Such price shall be subject to adjustment
pursuant to the terms hereof (such price, as adjusted from time to
time, is hereinafter referred to as the “
Exercise
Price
”).
2
.
Exercise
and Payment
.
2.1
Exercise.
At any time after the date of this Warrant, this Warrant may be
exercised, in whole or in part, from time to time by the Holder,
during the term hereof, by surrender of this Warrant and the Notice
of Exercise attached hereto as
Annex I
, duly completed and
executed by the Holder, to the Company at the principal executive
offices of the Company, together with payment in the amount
obtained by multiplying the Exercise Price then in effect by the
number of Shares thereby purchased, as designated in the Notice of
Exercise. Payment may be in cash, wire transfer or by check payable
to the order of the Company in immediately available funds. If not
exercised in full, this Warrant must be exercised for a whole
number of Shares.
2.2
Cashless
Exercise
. If: (i) the Company shall have failed to timely
file the Resale Registration Statement (as hereinafter defined); or
(ii) at any time thereafter during the Exercise Period there is not
an effective registration statement registering the Shares, or the
prospectus contained therein is not available for the issuance of
the Shares to the Holder, for a period of at least sixty (60) days
following the delivery of the Suspension Notice (as hereinafter
defined), then this Warrant may also be exercised, in whole or in
part, at such time by means of a “cashless exercise” in
which the Holder shall be entitled to receive a certificate for the
number of Shares equal to the quotient obtained by dividing [(A-B)
(X)] by (A), where:
(A) =
the average of the closing sale prices for the five (5) trading
days immediately prior to (but not including) the exercise
date;
(B) =
the Exercise Price of this Warrant, as adjusted hereunder;
and
(X) =
the number of Shares that would be issuable upon exercise of this
Warrant in accordance with the terms of this Warrant if such
exercise were by means of a cash exercise rather than a cashless
exercise.
When
used herein, a “
Suspension
Notice
” shall mean the occurrence of any of the
following events: (i) any request by the Securities and Exchange
Commission (“
SEC
”)
or any other federal or state governmental authority, during the
period of effectiveness of the Resale Registration Statement, for
amendments or supplements to such registration statement or related
prospectus or for additional information; (ii) the issuance by the
SEC or any other federal or state governmental authority of any
stop order suspending the effectiveness of the Resale Registration
Statement or the initiation of any proceedings for that purpose;
(iii) the receipt by the Company of any notification with respect
to the suspension of the qualification or exemption from
qualification of any of the Shares for sale in any jurisdiction
from a state governmental authority or the initiation of any
proceeding for such purpose by a state governmental authority; or
(iv) any event or circumstance which necessitates the making of any
changes to the Resale Registration Statement or related prospectus,
or any document incorporated or deemed to be incorporated therein
by reference, so that, in the case of the Resale Registration
Statement, it will not include any untrue statement of a material
fact or omit to state a material fact required to be stated therein
or necessary to make the statements made therein not misleading
and, in the case of the prospectus, it will not contain any untrue
statement of a material fact or omit to state a material fact
necessary to make the statements made therein, in the light of the
circumstances under which they were made, not misleading. The
Company will promptly provide written notice to the Holder of the
occurrence of any Suspension Event. The Company shall thereafter
promptly prepare a supplement or amendment to the Resale
Registration Statement to correct such untrue statement or
omission, and provide a copy of such supplement or amendment to the
Holder. The Company shall also promptly notify the Holder in
writing (x) when a prospectus or any prospectus supplement or
post-effective amendment has been filed, and when a registration
statement or any post-effective amendment has become effective and
(y) of the Company’s reasonable determination that a
post-effective amendment to a registration statement would be
appropriate.
For
purposes of Rule 144 promulgated under the Securities Act of 1933,
as amended (the “
Act
”),
it is intended, understood and acknowledged that the Shares issued
in a cashless exercise transaction shall be deemed to have been
acquired by the Holder, and the holding period for the Shares shall
be deemed to have commenced, on the date this Warrant was
originally issued pursuant to the Offering Documents (provided the
SEC continues to take the position that such treatment is proper at
the time of such exercise).
2.3
Holder's
Exercise Limitation
. The Company shall not effect any
exercise of this Warrant, and a Holder shall not have the right to
exercise any portion of this Warrant, pursuant to Section 2.1,
Section 2.2 or otherwise, to the extent that after giving effect to
such issuance after exercise as set forth on the applicable Notice
of Exercise, the Holder (together with the Holder’s
Affiliates (as that term is defined in the Securities Exchange Act
of 1934, as amended (the “
Exchange
Act
”)), and any other persons acting as a group
together with the Holder or any of the Holder’s Affiliates),
would beneficially own in excess of the Beneficial Ownership
Limitation (as defined below). For purposes of the foregoing
sentence, the number of shares of Common Stock beneficially owned
by the Holder and its Affiliates shall include the number of shares
of Common Stock issuable upon exercise of this Warrant with respect
to which such determination is being made, but shall exclude the
number of shares of Common Stock which would be issuable upon (i)
exercise of the remaining, nonexercised portion of this Warrant
beneficially owned by the Holder or any of its Affiliates, and (ii)
exercise or conversion of the unexercised or nonconverted portion
of any other securities of the Company (including, without
limitation, any other Common Stock Equivalents) subject to a
limitation on conversion or exercise analogous to the limitation
contained herein beneficially owned by the Holder or any of its
Affiliates. Except as set forth in the preceding sentence, for
purposes of this Section 2.3, beneficial ownership shall be
calculated in accordance with Section 13(d) of the Exchange Act and
the rules and regulations promulgated thereunder, it being
acknowledged by the Holder that the Company is not representing to
the Holder that such calculation is in compliance with Section
13(d) of the Exchange Act and the Holder is solely responsible for
any schedules required to be filed in accordance therewith. To the
extent that the limitation contained in this Section 2.3 applies,
the determination of whether this Warrant is exercisable (in
relation to other securities owned by the Holder together with any
Affiliates) and of which portion of this Warrant is exercisable
shall be in the sole discretion of the Holder, and the submission
of a Notice of Exercise shall be deemed to be the Holder’s
determination of whether this Warrant is exercisable (in relation
to other securities owned by the Holder together with any
Affiliates) and of which portion of this Warrant is exercisable, in
each case subject to the Beneficial Ownership Limitation, and the
Company shall have no obligation to verify or confirm the accuracy
of such determination and shall have no liability for exercises of
the Warrant that are not in compliance with the Beneficial
Ownership Limitation. In addition, a determination as to any group
status as contemplated above shall be determined in accordance with
Section 13(d) of the Exchange Act and the rules and regulations
promulgated thereunder and the Company shall have no obligation to
verify or confirm the accuracy of such determination and shall have
no liability for exercises of the Warrant that are not in
compliance with the Beneficial Ownership Limitation. For purposes
of this Section 2.3, in determining the number of outstanding
shares of Common Stock, a Holder may rely on the number of
outstanding shares of Common Stock as reflected in (A) the
Company’s most recent periodic or annual report filed with
the Securities and Exchange Commission, as the case may be, (B) a
more recent public announcement by the Company or (C) a more recent
written notice by the Company or its transfer agent setting forth
the number of shares of Common Stock outstanding. Upon the written
or oral request of a Holder, the Company shall as promptly as
practicable confirm orally and in writing to the Holder the number
of shares of Common Stock then outstanding. In any case, the number
of outstanding shares of Common Stock shall be determined after
giving effect to the conversion or exercise of securities of the
Company, including this Warrant, by the Holder or its Affiliates
since the date as of which such number of outstanding shares of
Common Stock was reported. The “
Beneficial
Ownership Limitation
” shall be 4.99% of the number of
shares of the Common Stock outstanding immediately after giving
effect to the issuance of shares of Common Stock issuable upon
exercise of this Warrant. The Holder, upon not less than 61
days’ prior notice to the Company, may increase or decrease
the Beneficial Ownership Limitation provisions of this Section 2.3,
provided that the Beneficial Ownership Limitation in no event
exceeds 9.99% of the number of shares of the Common Stock
outstanding immediately after giving effect to the issuance of
shares of Common Stock upon exercise of this Warrant held by the
Holder and the provisions of this Section 2.3 shall continue to
apply. Any such increase or decrease will not be effective until
the 61
st
day after such notice is delivered to the Company. The provisions
of this paragraph shall be construed and implemented in a manner
otherwise than in strict conformity with the terms of this Section
2.3 to correct this paragraph (or any portion hereof) which may be
defective or inconsistent with the intended Beneficial Ownership
Limitation herein contained or to make changes or supplements
necessary or desirable to properly give effect to such limitation.
The limitations contained in this paragraph shall apply to a
successor holder of this Warrant.
3.
Company’s
Right to Call this Warrant
. Subject to the terms and
conditions set forth herein, and providing that there is an
effective registration statement registering the Shares issuable
upon exercise of this Warrant, during the Exercise Period, upon
thirty (30) days prior written notice to the Holder (each, a
“
Call
Notice
”) following the date on which the last sale
price of the Company’s Common Stock equals or exceeds $1.50
per share for ten (10) consecutive trading days, as may be adjusted
for stock splits, stock dividends and similar corporate events, if
the average daily trading volume of the Company’s Common
Stock is not less than thirty thousand (30,000) shares during such
ten (10) consecutive trading day period, the Company shall have the
right to call any or all of the Warrants at a call price of $0.01
per underlying Share (the “
Call
Price
”). Warrant holders shall have the period from
the date of the Call Notice until 5 p.m., Eastern time, on the
twentieth (20th) day following the Call Notice (the
“
Call
Date
”) to exercise the Warrant pursuant to the terms
hereof. Any Warrants which have been called but remain unexercised
by the Call Date shall automatically terminate and no longer
entitle the Holder to exercise such Warrant or to receive any
consideration therefor, other than the Call Price. For any Warrants
which are not exercised by the Call Date, the Company shall
promptly as possible following the Call Date pay the Call Price to
the Holder of any Warrants which have been called and not
exercised.
4.
Registration
Rights
.
No later than
one hundred and twenty (120) days (the “
Filing
Deadline
”) following the Final Closing (as that term
is defined in the Offering Documents), the Company will file a
registration statement with the SEC to register the resale of the
Shares by the Holder so as to permit the public resale thereof (the
“
Resale Registration
Statement
”). The Company will use its reasonable
efforts to ensure that such Resale Registration Statement is
declared effective by the SEC as soon as practicable. The Company
will keep such Resale Registration Statement effective until the
earlier of the date upon which all Shares may be sold without
registration under Rule 144 or the date which is six months after
the expiration of the Warrants. If the Company should fail to file
the Resale Registration Statement by the Filing Deadline, then
within five (5) business days of the end of month the Company shall
pay the Holder an amount in cash, as partial liquidated damages,
equal to two percent (2%) of the aggregate Purchase Price (as that
term is defined in the Offering Documents) paid by such Holder for
each 30 days, or portion thereof, until the earlier of the date the
deficiency is cured or the expiration of six (6) months from Filing
Deadline (the
“
Penalty
”).
No Holder shall be entitled to a Penalty payment pursuant to this
Section 4
if the
filing of the Resale Registration Statement has been delayed as the
result of the failure by such Holder to promptly provide on request
by the Company the information required under the Subscription
Agreement which is part of the Offering Documents. Notwithstanding
any other provision of this Warrant, if any (i) any
publicly-available written guidance, or rule of general
applicability of the SEC staff, or (ii) oral or written comments,
requirements or requests of the SEC staff to the Company in
connection with the review of the Resale Registration Statement
sets forth a limitation on the number of Shares to be registered in
the Resale Registration Statement (and the Company has used its
best efforts to advocate with the SEC for the registration of all
or the maximum number of Shares), the number of Shares to be
registered on such Resale Registration Statement will be reduced on
a pro rata basis among the purchasers of Warrants issued and sold
pursuant to the Offering Documents based on the total number of
Shares underlying Warrants held by such purchasers.
6.
Reservation
of Shares
.
The
Company hereby agrees that at all times there shall be reserved for
issuance and delivery upon exercise of this Warrant such number of
Shares or other shares of capital stock of the Company from time to
time issuable upon exercise of this Warrant. All such shares shall
be duly authorized, and when issued upon such exercise, shall be
validly issued, fully paid and non-assessable, free and clear of
all liens, security interests, charges and other encumbrances or
restrictions on sale and free and clear of all preemptive
rights.
6.
Delivery
of Stock Certificates
.
Within three (3) trading days after
exercise, in whole or in part, of this Warrant, the Company shall
issue in the name of and deliver to the Holder a certificate or
certificates for the number of fully paid and nonassessable Shares
which the Holder shall have requested in the Notice of Exercise. If
this Warrant is exercised in part, the Company shall deliver to the
Holder a new Warrant (dated the date hereof and of like tenor) for
the unexercised portion of this Warrant at the time of delivery of
such stock certificate or certificates.
7.
No
Fractional Shares
.
This Warrant must be exercised for a whole number of Shares. No
fractional shares or scrip representing fractional Shares will be
issued upon exercise of this Warrant. Any fractional Share which
otherwise might be issuable on the exercise of this Warrant as a
result of the anti-dilution provisions Section 10 hereof will be
rounded up to the nearest whole Share.
8.
Charges,
Taxes and Expenses
.
The Company shall pay all transfer taxes or other incidental
charges, if any, in connection with the transfer of the Shares
purchased pursuant to the exercise hereof from the Company to the
Holder.
9.
Loss,
Theft, Destruction or Mutilation of Warrant
.
Upon receipt by the Company of
evidence reasonably satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant, and in case of loss,
theft or destruction, of indemnity or security reasonably
satisfactory to the Company, and upon reimbursement to the Company
of all reasonable expenses incidental thereto, and upon surrender
and cancellation of this Warrant, if mutilated, the Company will
make and deliver a new Warrant of like tenor and dated as of such
cancellation, in lieu of this Warrant.
10.
Saturdays,
Sundays, Holidays, Etc
.
If the last or appointed day for the
taking of any action or the expiration of any right required or
granted herein shall be a Saturday or a Sunday or shall be a legal
holiday, then such action may be taken or such right may be
exercised on the next succeeding weekday which is not a legal
holiday.
11.
Adjustment
of Exercise Price and Number of Shares
.
The Exercise Price and the number of
and kind of securities purchasable upon exercise of this Warrant
shall be subject to adjustment from time to time as
follows:
11.1
Subdivisions,
Combinations and Other Issuances
. If the Company shall at
any time after the date hereof but prior to the expiration of this
Warrant subdivide its outstanding securities as to which purchase
rights under this Warrant exist, by split-up or otherwise, or
combine its outstanding securities as to which purchase rights
under this Warrant exist, the number of Shares as to which this
Warrant is exercisable as of the date of such subdivision, split-up
or combination shall forthwith be proportionately increased in the
case of a subdivision, or proportionately decreased in the case of
a combination. Appropriate adjustments shall also be made to the
Exercise Price, but the aggregate purchase price payable for the
total number of Shares purchasable under this Warrant as of such
date shall remain the same.
11.2
Stock
Dividend
. If at any time after the date hereof the Company
declares a dividend or other distribution on its Common Stock
payable in Common Stock or other securities or rights convertible
into Common Stock (“
Common Stock
Equivalents
”) without payment of any consideration by
such holder for the additional shares of Common Stock or the Common
Stock Equivalents (including the additional shares of Common Stock
issuable upon exercise or conversion thereof), then the number of
Shares for which this Warrant may be exercised shall be increased
as of the record date (or the date of such dividend distribution if
no record date is set) for determining which holders of Common
Stock shall be entitled to receive such dividend, in proportion to
the increase in the number of outstanding shares (and shares of
Common Stock issuable upon conversion of all such securities
convertible into Common Stock) of Common Stock as a result of such
dividend, and the Exercise Price shall be adjusted so that the
aggregate amount payable for the purchase of all the Shares
issuable hereunder immediately after the record date (or on the
date of such distribution, if applicable), for such dividend shall
equal the aggregate amount so payable immediately before such
record date (or on the date of such distribution, if
applicable).
11.3.
Other
Distributions
. If at any time after the date hereof the
Company distributes to holders of its Common Stock, other than as
part of its dissolution or liquidation or the winding up of its
affairs, any shares of its capital stock, any evidence of
indebtedness or any of its assets (other than cash, Common Stock or
Common Stock Equivalents), then the Company may, at its option,
either (i) decrease the Exercise Price of this Warrant by an
appropriate amount based upon the value distributed on each share
of Common Stock as determined in good faith by the Company’s
Board of Directors, or (ii) provide by resolution of the
Company’s Board of Directors that on exercise of this
Warrant, the Holder hereof shall thereafter be entitled to receive,
in addition to the shares of Common Stock otherwise receivable on
exercise hereof, the number of shares or other securities or
property which would have been received had this Warrant at the
time been exercised.
11.4
Effect
of Consolidation, Merger or Sale
. In case of any
reclassification, capital reorganization, or change of securities
of the class issuable upon exercise of this Warrant (other than a
change in par value, or from par value to no par value, or from no
par value to par value, or as a result of any subdivision,
combination, stock dividend or other distribution provided for in
Sections 11.1
,
11.2
and
11.3
above), or in
case of any consolidation or merger of the Company with or into any
corporation (other than a consolidation or merger with another
corporation in which the Company is the acquiring and the surviving
corporation and which does not result in any reclassification or
change of outstanding securities issuable upon exercise of this
Warrant), or in case of any sale of all or substantially all of the
assets of the Company, the Company, or such successor or purchasing
corporation, as the case may be, shall duly execute and deliver to
the holder of this Warrant a new Warrant (in form and substance
satisfactory to the holder of this Warrant), or the Company shall
make appropriate provision without the issuance of a new Warrant,
so that the holder of this Warrant shall have the right to receive,
at a total purchase price not to exceed that payable upon the
exercise of the unexercised portion of this Warrant, and in lieu of
the Shares theretofore issuable upon exercise of this Warrant, the
kind and amount of shares of stock, other securities, money and
property receivable upon such reclassification, capital
reorganization, change, merger or sale by a holder of the number of
Shares then purchasable under this Warrant. In any such case,
appropriate provisions shall be made with respect to the rights and
interest of Holder so that the provisions hereof shall thereafter
be applicable to any shares of stock or other securities and
property deliverable upon exercise hereof, or to any new Warrant
delivered pursuant to this
Section 11.4
, and appropriate
adjustments shall be made to the Exercise Price per share payable
hereunder, provided, that the aggregate Exercise Price shall remain
the same. The provisions of this
Section 11.4
shall similarly
apply to successive reclassifications, capital reorganizations,
changes, mergers and transfers.
12.
Notice
of Adjustments; Notices
.
Whenever the Exercise Price or number
of Shares purchasable hereunder shall be adjusted pursuant to
Section 11
hereof,
the Company shall execute and deliver to the Holder a certificate
setting forth, in reasonable detail, the event requiring the
adjustment, the amount of the adjustment, the method by which such
adjustment was calculated and the Exercise Price and number of and
kind of securities purchasable hereunder after giving effect to
such adjustment, and shall cause a copy of such certificate to be
mailed (by first class mail, postage prepaid) to the
Holder.
13.
Rights
As Shareholder; Notice to Holders
.
Nothing contained in this Warrant
shall be construed as conferring upon the Holder or his or its
transferees the right to vote or to receive dividends or to consent
or to receive notice as a shareholder in respect of any meeting of
shareholders for the election of directors of the Company or of any
other matter, or any rights whatsoever as shareholders of the
Company. The Company shall give notice to the Holder by registered
mail if at any time prior to the expiration or exercise in full of
the Warrants, any of the following events shall occur:
(i) a
dissolution, liquidation or winding up of the Company shall be
proposed;
(ii) a
capital reorganization or reclassification of the 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, or as a result of any
subdivision, combination, stock dividend or other distribution) or
any consolidation or merger of the Company with or into another
corporation (other than a consolidation or merger with another
corporation in which the Company is the acquiring and the surviving
corporation and which does not result in any reclassification or
change of outstanding securities issuable upon exercise of this
Warrant), or in case of any sale of all or substantially all of the
assets of the Company; or
(iii) a
taking by the Company of a record of the holders of any class of
securities for the purpose of determining the holders thereof who
are entitled to receive any dividend (other than a cash dividend)
for other distribution, any right to subscribe for, purchase or
otherwise acquire any shares of stock of any class or any other
securities or property, or to receive any other
rights.
Such
giving of notice shall be simultaneous with (or in any event, no
later than) the giving of notice to holders of Common Stock. Such
notice shall specify the record date or the date of closing the
stock transfer books, as the case may be. Failure to provide such
notice shall not affect the validity of any action contemplated in
this
Section
13
.
14.
Restricted
Securities
.
The
Holder understands that this Warrant and the Shares purchasable
hereunder constitute “restricted securities” under the
federal securities laws inasmuch as they are, or will be, acquired
from the Company in transactions not involving a public offering
and accordingly may not, under such laws and applicable
regulations, be resold or transferred without registration under
the Act, or an applicable exemption from such registration. The
Holder further acknowledges that a securities legend to the
foregoing effect shall be placed on any Shares issued to the Holder
upon exercise of this Warrant.
15.
Disposition
of Shares; Transferability
.
15.1
Transfer
.
This Warrant shall be transferable only on the books of the
Company, upon delivery thereof duly endorsed by the Holder or by
its duly authorized attorney or representative, accompanied by
proper evidence of succession, assignment or authority to transfer.
Upon any registration of transfer, the Company shall execute and
deliver new Warrants to the person entitled thereto.
15.2
Rights,
Preferences and Privileges of Common Stock
. The powers,
preferences, rights, restrictions and other matters relating to the
shares of Common Stock will be as determined in the Company’s
Amended and Restated Articles of Incorporation, as amended, as then
in effect.
16.
Miscellaneous
.
16.1
Binding
Effect
. This Warrant and the various rights and obligations
arising hereunder shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and
assigns.
16.2
Entire
Agreement
. This Warrant and the Offering Documents
constitute the entire agreement between the parties with respect to
the subject matter hereof and supersede all prior and
contemporaneous agreements, whether oral or written, between the
parties hereto with respect to the subject matter
hereof.
16.3
Amendment
and Waiver
. Any term of this Warrant may be amended and the
observance of any term hereof may be waived (either generally or in
a particular instance and either retroactively or prospectively),
with the written consent of the Company and the
Holder.
16.4
Governing
Law
. This Agreement shall be governed by and construed under
the laws of the State of Florida without reference to the conflicts
of law principles thereof. The exclusive jurisdiction for any legal
suit, action or proceeding arising out of or related to this
Warrant shall be the United States District Court for the Southern
District of Florida.
16.5
Headings
.
The headings in this Agreement are for convenience only and shall
not alter or otherwise affect the meaning hereof.
16.6
Severability
.
If one or more provisions of this Warrant are held to be
unenforceable under applicable law, such provision shall be
excluded from this Warrant and the balance of the Warrant shall be
interpreted as if such provision were so excluded and the balance
shall be enforceable in accordance with its terms.
16.7
Notices
.
Unless otherwise provided, any notice required or permitted under
this Warrant shall be given in the same manner as provided in the
Agreement.
IN WITNESS WHEREOF
, the parties hereto
have executed and delivered this Warrant as of the date appearing
on the first page of this Warrant.
THE
COMPANY:
BRIGHT
MOUNTAIN MEDIA, INC.
By:
_______________________________
W. Kip
Speyer, Chief Executive Officer
ANNEX I
NOTICE OF EXERCISE
To:
Bright
Mountain Media, Inc.
1.
The undersigned
Holder hereby elects to purchase _____________ shares of common
stock, $0.01 par value per share (the “
Shares
”)
of Bright Mountain Media, Inc., a Florida corporation (the
“
Company
”),
pursuant to the terms of the attached Warrant. The Holder shall
make payment of the Exercise Price by delivering the sum of
$____________, in lawful money of the United States, to the Company
in accordance with the terms of the Warrant.
2.
Please issue and
deliver certificates representing the Warrant Shares purchased
hereunder to Holder:
,
Address
:
in the following
denominations: ____________________________.
3.
Please issue a new
Warrant for the unexercised portion of the attached Warrant, if
any, in the name of the undersigned.
4.
The undersigned is
an “accredited investor” as defined in Regulation D
promulgated under the Securities Act of 1933, as
amended.
SIGNATURE OF HOLDER
Name of Investing
Entity:
Signature of Authorized Signatory of Investing
Entity:
Name of Authorized
Signatory:
Title of Authorized
Signatory:
FORM OF PLACEMENT AGENT WARRANT
NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS
DOCUMENT NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE
CONVERTIBLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY
NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE
ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE
SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN
OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER
AND REASONABLY APPROVED BY THE COMPANY), IN A GENERALLY ACCEPTABLE
FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II)
UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT.
NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN
CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR
FINANCING ARRANGEMENT SECURED BY THE SECURITIES.
---------------------------------------
BRIGHT MOUNTAIN MEDIA, INC.
COMMON STOCK PURCHASE WARRANT
Dated:
December 28, 2018
Number of shares:
283,625
Holder:
Spartan Capital
Securities, LLC
Exercise
Price per Share: $0.65
Expiration
Date: December 28, 2023 (the "
Expiration Date
")
FOR VALUE RECEIVED,
Bright Mountain Media, Inc., a
corporation incorporated under the laws of the State of Florida
(the “
Company
”), hereby
certifies that Spartan Capital Securities, LLC, or its assigns (the
“
Warrant
Holder
”), is entitled, subject to the terms set forth
below, to purchase from the Company
TWO HUNDRED EIGHTY THREE THOUSAND SIX HUNDRED
TWENTY FIVE (283,625)
shares (the “
Warrant Shares
”) of
common stock, $0.01 par value (the “
Common Stock
”), of the
Company at an exercise price of Sixty-Five Cents (US$0.65) per
share (as adjusted from time to time as provided in Section 6, per
Warrant Share (the “
Exercise Price
”), at any
time and from time to time from and after the date thereof and
through and including 5:00 p.m. New York City time on the
Expiration Date. This Warrant is being issued as compensation to
the Warrant Holder under the terms of the Confidential Private
Offering Memorandum for Accredited Investors Only dated December
13, 2018 (the "
Memorandum
") and the Placement
Agent Agreement dated December 3, 2018 by and between the Company
and the Warrant Holder. All terms not otherwise defined herein
shall have the same meaning as in the Memorandum.
This
Warrant is subject to the following terms and
conditions:
1.
Registration of Warrant
. The
Company shall register this Warrant upon records to be maintained
by the Company for that purpose (the “
Warrant Register
”), in
the name of the record Warrant Holder hereof from time to time. The
Company may deem and treat the registered Warrant Holder of this
Warrant as the absolute owner hereof for the purpose of any
exercise hereof or any distribution to the Warrant Holder, and for
all other purposes, and the Company shall not be affected by notice
to the contrary.
2.
Investment Representation
. The
Warrant Holder by accepting this Warrant represents that the
Warrant Holder is acquiring this Warrant for its own account for
investment purposes and not with the view to any offering or
distribution and that the Warrant Holder will not sell or otherwise
dispose of this Warrant or the underlying Warrant Shares in
violation of applicable securities laws. The Warrant Holder
acknowledges that the certificates representing any Warrant Shares
will bear a legend indicating that they have not been registered
under the United States Securities Act of 1933, as amended (the
“
1933
Act
”) and may not be sold by the Warrant Holder except
pursuant to an effective registration statement or pursuant to an
exemption from registration requirements of the 1933 Act and in
accordance with federal and state securities laws.
3.
Validity of Warrant and Issue of
Shares
. The Company represents and warrants that this
Warrant has been duly authorized and validly issued and warrants
and agrees that all of Common Stock that may be issued upon the
exercise of the rights represented by this Warrant will, when
issued upon such exercise, be duly authorized, validly issued,
fully paid and nonassessable and free from all taxes, liens and
charges with respect to the issue thereof. The Company further
warrants and agrees that during the period within which the rights
represented by this Warrant may be exercised, the Company will at
all times have authorized and reserved a sufficient number of
Common Stock to provide for the exercise of the rights represented
by this Warrant.
4.
Registration of Transfers and Exchange
of Warrants
.
a. Subject
to compliance with the legend set forth on the face of this
Warrant, the Company shall register the transfer of any portion of
this Warrant in the Warrant Register, upon surrender of this
Warrant with the Form of Assignment attached hereto duly completed
and signed, to the Company at the office specified in or pursuant
to Section 8. Upon any such registration or transfer, a new warrant
to purchase Common Stock, in substantially the form of this Warrant
(any such new warrant, a “
New Warrant
”), evidencing
the portion of this Warrant so transferred shall be issued to the
transferee and a New Warrant evidencing the remaining portion of
this Warrant not so transferred, if any, shall be issued to the
transferring Warrant Holder. The acceptance of the New Warrant by
the transferee thereof shall be deemed the acceptance of such
transferee of all of the rights and obligations of a Warrant Holder
of a Warrant.
b. This
Warrant is exchangeable, upon the surrender hereof by the Warrant
Holder to the office of the Company specified in or pursuant to
Section 8 for one or more New Warrants, evidencing in the aggregate
the right to purchase the number of Warrant Shares which may then
be purchased hereunder. Any such New Warrant will be dated the date
of such exchange.
5.
Exercise of
Warrants
.
a. Exercise
of this Warrant shall be made upon surrender of this Warrant with
the Form of Election to Purchase attached hereto duly completed and
signed to the Company, at its address set forth in Section 8.
Payment upon exercise may be made at the written option of the
Warrant Holder in cash, wire transfer or by certified or official
bank check payable to the order of the Company equal to the
applicable aggregate purchase price for the number of Warrant
Shares specified in such form (as such exercise number shall be
adjusted to reflect any adjustment in the total number of Warrant
Shares issuable to the Warrant Holder per the terms of this
Warrant) and the Warrant Holder shall thereupon be entitled to
receive the number of duly authorized, validly issued, fully-paid
and non-assessable Warrant Shares determined as provided herein.
The Company shall promptly (but in no event later than five (5)
business days after the Date of Exercise (as defined herein) issue
or cause to be issued and cause to be delivered to or upon the
written order of the Warrant Holder and in such name or names as
the Warrant Holder may designate (subject to the restrictions on
transfer described in the legend set forth on the face of this
Warrant), a certificate for the Warrant Shares issuable upon such
exercise, with such restrictive legend as required by the 1933 Act,
as applicable. Any person so designated by the Warrant Holder to
receive Warrant Shares shall be deemed to have become holder of
record of such Warrant Shares as of the Date of Exercise of this
Warrant.
b. The
Warrant Holder may alternatively exercise this Warrant, in whole or
in part, according to the terms hereof by surrendering this Warrant
to the Company, at its address set forth in Section 8, with the
Notice of Cashless Exercise attached hereto having then been duly
executed and delivered by the Holder, in which event the Company
shall issue to the Warrant Holder the number of shares of Common
Stock computed using the following formula:
X=
Y
(A-B)
A
Where
X= the number of shares of Common Stock to be issued to the Warrant
Holder
Y=
the number of
shares of Common Stock purchasable under the Warrant or, if only a
portion of the Warrant is being exercised, the portion of the
Warrant being exercised (at the date of such
calculation)
A=
Fair Market Value
(as defined below) as of the Date of Exercise
B=
Exercise Price (as
adjusted to the date of such calculation)
For
purposes of this Section 5.b, the per share “
Fair Market Value
” of the
Warrant Shares shall mean:
i.
If the
Company’s Common Stock is publicly traded, the per share fair
market value of the Warrant Shares shall be the average of the
closing prices of the Common Stock as quoted on the principal
quotation market for the Common Stock, or the principal exchange on
which the Common Stock is listed, in each case for the five trading
days ending one trading day prior to the date of determination of
Fair Market Value.
ii.
If the
Company’s Common Stock is not so publicly traded, the per
share fair market value of the Warrant Shares shall be such fair
market value as is determined in good faith by the Board of
Directors of the Company after taking into consideration factors it
deems appropriate, including, without limitation, recent sale and
offer prices of the capital stock of the Company in private
transactions negotiated at arm’s length.
For
purposes of this Warrant, “
Date of Exercise
” means
the date on which the Company shall have received (i) this Warrant
(or any New Warrant, as applicable), with the Form of Election to
Purchase or Notice of Cashless Exercise attached hereto (or
attached to such New Warrant) appropriately completed and duly
signed, and (ii) payment of the applicable Exercise Price for the
number of Warrant Shares so indicated by the Warrant Holder to be
purchased.
For
purposes of Rule 144 promulgated under the 1933 Act, it is
intended, understood and acknowledged that the Warrant Shares
issued in a cashless exercise transaction in the manner described
above shall be deemed to have been acquired by the Warrant Holder,
and the holding period for the Warrant Shares shall be deemed to
have commenced, on the date this Warrant was originally
issued.
c. This
Warrant shall be exercisable at any time and from time to time for
such number of Warrant Shares as is indicated in the attached Form
of Election to Purchase. If less than all of the Warrant Shares
which may be purchased under this Warrant are exercised at any
time, the Company shall issue or cause to be issued, at its
expense, a New Warrant evidencing the right to purchase the
remaining number of Warrant Shares for which no exercise has been
evidenced by this Warrant.
6.
Adjustment of Exercise Price and
Number of Shares
. The character of the shares of stock or
other securities at the time issuable upon exercise of this Warrant
and the Exercise Price therefor, are subject to adjustment upon the
occurrence of the following events:
a.
Adjustment
for Stock Splits, Stock Dividends, Recapitalizations, Etc.
The Exercise Price of this Warrant and the number of shares of
Common Stock or other securities at the time issuable upon exercise
of this Warrant shall be appropriately adjusted to reflect any
stock dividend, stock split, combination of shares,
reclassification, recapitalization or other similar event affecting
the number of outstanding shares of stock or
securities.
b.
Adjustment
for Reorganization, Consolidation, Merger, Etc.
In case of
any consolidation or merger of the Company with or into any other
corporation, entity or person, or any other corporate
reorganization, in which the Company shall not be the continuing or
surviving entity of such consolidation, merger or reorganization
(any such transaction being hereinafter referred to as a
“
Reorganization
”), then,
in each case, the holder of this Warrant, on exercise hereof at any
time after the consummation or effective date of such
Reorganization (the “
Effective Date
”), shall
receive, in lieu of the shares of stock or other securities at any
time issuable upon the exercise of the Warrant issuable on such
exercise prior to the Effective Date, the stock and other
securities and property (including cash) to which such holder would
have been entitled upon the Effective Date if such holder had
exercised this Warrant immediately prior thereto (all subject to
further adjustment as provided in this Warrant).
c.
Certificate
as to Adjustments
. In case of any adjustment or readjustment
in the price or kind of securities issuable on the exercise of this
Warrant, the Company will promptly give written notice thereof to
the holder of this Warrant in the form of a certificate, certified
and confirmed by the Board of Directors of the Company, setting
forth such adjustment or readjustment and showing in reasonable
detail the facts upon which such adjustment or readjustment is
based.
7.
Fractional Shares
. The Company
shall not be required to issue or cause to be issued fractional
Warrant Shares on the exercise of this Warrant. The number of full
Warrant Shares that shall be issuable upon the exercise of this
Warrant shall be computed on the basis of the aggregate number of
Warrants Shares purchasable on exercise of this Warrant so
presented. If any fraction of a Warrant Share would, except for the
provisions of this Section 7, be issuable on the exercise of this
Warrant, the Company shall, at its option, (i) pay an amount in
cash equal to the Exercise Price multiplied by such fraction or
(ii) round the number of Warrant Shares issuable, up to the next
whole number.
8.
Notice
. All notices and other
communications hereunder shall be in writing and shall be deemed to
have been given (i) on the date they are delivered if delivered in
person; (ii) on the date initially received if delivered by
facsimile transmission followed by registered or certified mail
confirmation; (iii) on the date delivered by an overnight courier
service; or (iv) on the third business day after it is mailed by
registered or certified mail, return receipt requested with postage
and other fees prepaid as follows:
If to
the Company:
Bright
Mountain Media, Inc.
6400
Congress Avenue, Suite 2050
Boca
Raton, Florida 33487
Attn:
W. Kip Speyer
If to
the Warrant Holder:
Spartan
Capital Securities, LLC
45
Broadway
New
York, New York 10006
Attention: John
Lowry
a.
[intentionally
omitted]
b.
[intentionally
omitted]
c.
Piggyback Rights.
If the
Company at any time proposes to register any of its securities
under the 1933 Act for sale, whether for its own account or for the
account of other security holders or both (except with respect to
(x) registration statements on Form S-8 or Form S-4 or their then
equivalent forms, or another form not available for registering the
Registrable Securities for sale to the public, (y) a registration
relating solely to employee benefit plans, or (z) a registration
relating solely to a Rule 145 transaction), it will each such time:
(i) promptly give to the Warrant Holder written notice thereof
(which shall include a list of the jurisdictions in which the
Company intends to attempt to qualify such securities under the
applicable blue sky or other state securities laws); and (ii)
include in such registration (and any related qualification under
blue sky laws or other compliance), and in any underwriting
involved therein, all of the Warrant Shares (the "
Registrable Securities
")
specified in a written request made by the Warrant Holder within
fifteen (15) days after receipt of the written notice from the
Company described in clause (i) above, except that the number of
Registrable Securities included in such registration on behalf of
the Warrant Holder, if any, shall be subject to the provisions set
forth in Section 9.e below. Such written request may specify all or
a part of the Warrant Holder's Registrable Securities.
d.
Underwritten Offering
. If the
registration of which the Company gives notice is for an
underwritten offering of Common Stock, the Company shall so advise
the Warrant Holder as a part of the written notice given pursuant
to Section 9.c. In such event, the right of the Warrant Holder to
registration pursuant to Section 9.c above shall be conditioned
upon the Warrant Holder’s participation in such underwriting.
The Warrant Holder shall, if it proposes to distribute Registrable
Securities through such underwriting (together with the Company and
other parties distributing securities through such underwriting),
enter into an underwriting agreement in customary form with the
managing underwriter(s) selected by the Company.
e.
Priority in Piggyback
Registrations
. If (i) a registration pursuant to Section 9.c
involves an underwritten offering of the securities so being
registered, whether or not for sale for the account of the Company,
and (ii) the managing underwriters of such underwritten offering
shall advise the Company in writing that, in its opinion, the
number or amount of securities (including Registrable Securities)
proposed to be sold in (or during the time of) such offering would
adversely affect the success of such offering, then the Company
shall include in such registration only such number or amount of
securities (including Registrable Securities) recommended by such
managing underwriter, selected in the following order or priority:
(i) first, all of the securities that the Company proposes to sell
for its own account, if any, and (ii) second, the Registrable
Securities requested to be included in such registration by the
Warrant Holders and the Private Placement Holders pro rata based
upon the number of shares for which registration has been
requested;
provided,
however
, that if any equity securities are proposed to be
included in such offering for the account of any person or persons
other than the Company, the Warrant Holder or the holders of
Warrants issued and sold pursuant to the Memorandum (the
"
Private Placement
Holders
") pursuant to rights of piggyback registration
similar to those provided in Section 9.c, all shares proposed to be
included therein by the Company, the Warrant Holder or the Private
Placement Holders shall be included prior to the inclusion of any
other registrable equity securities that have requested to be
included.
f.
Expenses.
With respect to any
registration under this Section 9, the Company shall bear the
following fees, costs and expenses: all registration and filing
fees, printing expenses, fees and disbursements of counsel for the
underwriter of such securities (if the Company or the Warrant
Holder is required to bear such fees and disbursements), all
internal Company expenses, all Company legal and accounting fees
and disbursements and other expenses of complying with state
securities or blue sky laws of any jurisdictions in which the
Registrable Securities to be offered are to be registered or
qualified, and any other Company costs, if any, arising out of such
public offering. Fees and disbursements of counsel for the Warrant
Holder, underwriting discounts and commissions and transfer taxes
relating to the Registrable Securities included in the offering,
and any other expenses not expressly included above, shall be borne
by the Warrant Holder.
g.
Other
Obligations of the Company.
i.
The Company shall
use its best efforts to cause the Registrable Securities registered
under this Section 9 to be registered or qualified for sale under
the securities or “blue sky” laws of such jurisdictions
as the Warrant Holder may reasonably request;
provided, however
, that the
Company shall not be required to qualify to do business in any
state by reason of this paragraph in which it is not otherwise
required to qualify to do business.
ii.
The Company shall
keep effective the registration or qualification contemplated by
this Section 9 and shall from time to time amend or supplement each
applicable registration statement, preliminary prospectus, final
prospectus, application, document and communication for such period
of time as shall be required to permit the Warrant Holder to
complete the offer and sale of the Registrable Securities covered
thereby.
iii.
In connection with
a registration pursuant to the provisions of this Section 9, the
Company shall furnish to the Warrant Holder therein such number of
copies of the registration statement and of each amendment and
supplement thereto (in each case, including all exhibits), such
reasonable number of copies of each prospectus contained in such
registration statement and each supplement or amendment thereto
(including each preliminary prospectus), all of which shall conform
to the requirements of the 1933 Act, and the rules and regulations
thereunder, and such other documents, as the Warrant Holder may
reasonably request in order to facilitate the disposition of the
Registrable Securities included in such registration.
h.
Indemnification.
i.
The Company agrees
to indemnify and hold harmless the Warrant Holder, and its
directors, officers, members, managers and employees and Warrant
Holder’s legal counsel, each person, if any, who controls the
Warrant Holder within the meaning of the 1933 Act or the 1934 Act,
and each and all of them, from and against any and all losses,
claims, damages, liabilities or actions, joint or several
(including any investigation, negotiation, legal and other expenses
incurred in connection with, and any amount paid in settlement of,
any action, suit or proceeding or any claim asserted), to which
they or any of them may become subject under the 1933 Act, or other
federal or state statutory law or regulation, at common law or
otherwise, insofar as such losses, claims, damages, liabilities or
actions arise out of, or are based upon, (i) any untrue statement
or alleged untrue statement of a material fact contained in such
registration statement or prospectus or the omission or alleged
omission to state therein a material fact required to be stated
therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading,
except to the extent any losses, claims, damages, liabilities or
actions arising out of any such statement or omission relating to
any information furnished in writing by or on behalf of the Warrant
Holder to the Company specifically for use in connection with the
preparation of such registration statement, or the omission of any
statement or information as a result of the failure of the Warrant
Holder to provide any such information, and (ii) the breach of any
representation, warranty or covenant of the Company contained in
this Warrant.
ii.
The Warrant Holder
agrees to indemnify and hold harmless each of the Company, and each
of its directors and officers employees and legal counsel, and each
person, if any, who controls the Company, within the meaning of the
1933 Act or the 1934 Act, and each and all of them, from and
against any and all losses, claims, damages, liabilities or
actions, joint or several (including any investigation,
negotiation, legal and other expenses incurred in connection with,
and any amount paid in settlement of, any action, suit or
proceeding or any claim asserted), to which they or any of them may
become subject under the 1933 Act, or other federal or state
statutory law or regulation, at common law or otherwise, insofar as
such losses, claims, damages, liabilities or actions arise out of
or are based upon (i) any statement in such registration statement
or prospectus, in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of the Warrant
Holder specifically for use in connection with the preparation of
such registration statement and (ii) the breach of any
representation, warranty or covenant of the Warrant Holder
contained in this Warrant. In no event shall the indemnification
and contribution obligations of Warrant Holder exceed the proceeds
that the Warrant Holder has actually received upon the sale,
transfer or other distribution of the shares of Common Stock
received upon the exercise of this Warrant.
iii.
Any party which
proposes to assert the right to be indemnified under this Section
9.h will, promptly after receipt of notice of commencement of any
action, suit or proceeding against such party in respect of which a
claim is to be made against an indemnifying party under this
Section 9.h, notify each such indemnifying party of the
commencement of such action, suit or proceeding, enclosing a copy
of all papers served, but the omission so to notify such
indemnifying party of any such action, suit or proceeding shall not
relieve it from any liability which it may have to any indemnified
party otherwise than under this Section 9.h unless it shall
adversely affect the indemnifying party in any material respect. In
case any such action, suit or proceeding shall be brought against
any indemnified party and it shall notify the indemnifying party of
the commencement thereof, the indemnifying party shall be entitled
to participate in and, to the extent that is shall wish, jointly
with any indemnifying party similarly notified, to assume the
defense thereof, with counsel reasonably satisfactory to such
indemnified party, and after notice from the indemnifying party to
such indemnified party of its election so to assume the defense
thereof the indemnifying party shall not be liable to such
indemnified party for any legal or other expenses, other than
reasonable costs of investigation subsequently incurred by such
indemnified party in connection with the defense thereof. The
indemnified party shall have the right to employ its own counsel in
any such action, but the fees and expenses of such counsel shall be
at the expense of such indemnified party unless:
iv.
the employment of
counsel by such indemnified party has been authorized by the
indemnifying parties;
v.
counsel for the
indemnified party shall have reasonably concluded that there may be
a conflict of interest between the indemnifying parties and the
indemnified party in the conduct of the defense of such action (in
which case the indemnifying parties shall not have the right to
direct the defense of such action on behalf of the indemnified
party); or
vi.
the indemnifying
parties shall not in fact have employed counsel to assume the
defense of such action, in each of which cases the fees and
expenses of counsel shall be at the expense of the indemnifying
parties. An indemnifying party shall not be liable for any
settlement of any action or claims effected without its written
consent.
vii.
If the
indemnification provided for in this Section 9.h is unavailable to
any indemnified party in respect to any losses, claims, damages,
liabilities or expenses referred to therein, then the indemnifying
party, in lieu of indemnifying such indemnified party, will
contribute to the amount paid or payable by such indemnified party,
as a result of such losses, claims, damages, liabilities or
expenses (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand, and the
Warrant Holder on the other hand, from the sale, transfer of other
distribution of the shares of Common Stock issuable upon the
exercise of this Warrant, or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative
fault of the Company on the one hand, and of the Warrant Holder on
the other hand, in connection with the statements or omissions
which resulted in such losses, claims, damages, liabilities or
expenses as well as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand, and
the Warrant Holder on the other hand, shall be deemed to be in the
same proportion as the total proceeds from the sale, transfer or
other distribution of the shares of Common Stock issuable upon the
exercise of this Warrant (net of sales commissions, but before
deducting expenses) received by the Warrant Holder. The relative
fault of the Company on the one hand, and the Warrant Holder on the
other hand, will be determined with reference to, among other
things, whether the untrue or alleged untrue statement of a
material fact or the omission to state a material fact relates to
information supplied by the Company, and their relative intent,
knowledge, access to information and opportunity to correct or
prevent such statement or omission. The amount payable by a party
as a result of the losses, claims, damages, liabilities or expenses
referred to above will be deemed to include any legal or other fees
or expenses reasonably incurred by such party in connection with
investigating or defending any action or claim.
viii.
The Company and the
Warrant Holder agree that it would not be just and equitable if
contribution pursuant to this Section 9.h were determined by pro
rata allocation or by any other method of allocation which does not
take into account the equitable considerations referred to in the
immediately preceding paragraph. Notwithstanding the provisions of
this Section 9.h, no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the 1933 Act) shall be
entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
a. This
Warrant shall be binding on and inure to the benefit of the parties
hereto and their respective successors and permitted assigns. This
Warrant may be amended only in writing and signed by the Company
and the Warrant Holder.
b. Nothing
in this Warrant shall be construed to give to any person or
corporation other than the Company and the Warrant Holder any legal
or equitable right, remedy or cause of action under this Warrant;
this Warrant shall be for the sole and exclusive benefit of the
Company and the Warrant Holder.
c. This
Warrant shall be governed by, construed and enforced in accordance
with the internal laws of the State of Florida without regard to
the principles of conflicts of law thereof. The exclusive
jurisdiction for any legal suit, action or proceeding arising out
of or related to this Warrant shall be the United States District
Court for the Southern District of Florida.
d. The
headings herein are for convenience only, do not constitute a part
of this Warrant and shall not be deemed to limit or affect any of
the provisions hereof.
e. In
case any one or more of the provisions of this Warrant shall be
invalid or unenforceable in any respect, the validity and
enforceability of the remaining terms and provisions of this
Warrant shall not in any way be affected or impaired thereby and
the parties will attempt in good faith to agree upon a valid and
enforceable provision which shall be a commercially reasonably
substitute therefore, and upon so agreeing, shall incorporate such
substitute provision in this Warrant.
f.
The Warrant Holder shall not, by virtue hereof, be entitled to any
voting or other rights of a shareholder of the Company, either at
law or equity, and the rights of the Warrant Holder are limited to
those expressed in this Warrant.
IN WITNESS WHEREOF
, the Company and the
Warrant Holder have caused this Warrant to be duly executed by the
authorized officer as of the date first above stated.
BRIGHT
MOUNTAIN MEDIA, INC.
Name:
W. Kip Speyer
Title:
Chief Executive Officer
SPARTAN
CAPITAL SECURITIES, LLC
Name:
John Lowry
Title:
Chief Executive Officer
FORM OF
ELECTION TO
PURCHASE
(To be
executed by the registered holder if such holder desires to
exercise the within Warrants)
Bright
Mountain Media, Inc.
6400
Congress Avenue, Suite 2050
Boca
Raton, Florida 33487
Attn:
W. Kip Speyer
The
undersigned hereby (1) irrevocably elects to exercise his or its
rights to purchase ____________ shares of Common Stock covered by
the within Warrants, (2) makes payment in full of the Purchase
Price by enclosure of cash, wire transfer, certified check or bank
check, (3) requests that certificates for such shares of Common
Stock be issued in the name of:
Please
print name, address and Social Security or Tax Identification
Number:
________________________________________________
________________________________________________
________________________________________________
________________________________________________
and (4)
if said number of shares of Common Stock shall not be all the
shares evidenced by the within Warrants, requests that a new
warrant certificate for the balance of the shares covered by the
within Warrants be registered in the name of, and delivered
to:
Please
print name and address:
________________________________________________
________________________________________________
________________________________________________
Dated:
_____________________
_________________________________
WARRANT
HOLDER
By:
_____________________________
Name:
Title:
NOTICE OF CASHLESS EXERCISE
(To be
executed upon exercise of warrant pursuant to Section
5.b
The
undersigned, the Holder of the attached Warrant, hereby irrevocably
elects to exchange its Warrant for _______ shares of Warrant Stock
pursuant to the cashless exercise provisions of the within Warrant,
as provided for in Section 5.b of such Warrant, and requests that a
certificate or certificates for such shares of Warrant Stock (and
any warrants or other property issuable upon exercise) be issued in
the name of and delivered to ___________________, whose address is
_________________________________ (social security or taxpayer
identification number _______________) and, if such shares shall
not include all of the shares issuable under such warrant, that a
new warrant of like tenor and date for the balance of the shares
issuable thereunder be delivered to the undersigned.
HOLDER:
_______________________________
Signature
________________________________
Signature, if
jointly held
_________________________________
Date
FORM OF ASSIGNMENT
FOR
VALUE RECEIVED,
hereby
sells, assigns and transfers unto
Name:
(Please
typewrite or print in block letters)
Social
Security or Taxpayer Identification Number :
the
right to purchase Common Stock of Bright Mountain Media Inc., a
Florida corporation, represented by this Warrant to the extent of
shares as to which such right is exercisable and does hereby
irrevocably constitute and appoint ____________________________,
Attorney, to transfer the same on the books of the Company with
full power of substitution in the premises.
DATED:
__________________
Signature
Signature, if
jointly held
Witness:
____________________________