EXHIBIT
10.1
NOTE PURCHASE
AGREEMENT
THIS NOTE
PURCHASE AGREEMENT (this “Agreement”) is made and
entered into as of the ___ day of_______, 2009, by and between Save
the World Air, Inc., a Nevada corporation (the
“Issuer”) and those individuals and entities
who sign and deliver an executed copy of this Agreement to the
Issuer (each, a “Purchaser” and collectively, the
“Purchasers”), with reference to the
following:
RECITALS
A. Purchasers
desire to purchase from Issuer and Issuer desires to sell to
Purchaser certain of Issuer’s Convertible Promissory Notes in
the aggregate face amount of at least $10,000 and up to $250,000 in
the form of Exhibit A attached hereto (individually, a
“Note” and collectively, the “Notes”) and
Stock Purchase Warrants, each to purchase up to a certain number of
shares of the common stock (the “Common Stock”) of the
Issuer equal to 50% of the number of shares initially issuable on
conversion of the Notes, in the form of Exhibit B attached
hereto (individually, the “Warrants” and collectively
with the Notes, the “Securities”). The face
amount of Convertible Promissory Notes each Purchaser has committed
to purchase, and the amount of the purchase price thereof to be
paid to the Issuer by the Purchaser (a “Commitment”) is
listed on the signature page such Purchaser executes and delivers
to the Issuer.
B. Issuer’s
sale of the Securities to the Purchasers will be made in reliance
upon the provisions of Section 4(2) under the Securities Act of
1933, as amended (the "Securities Act"), Rule 506 of Regulation D
promulgated by the Securities and Exchange Commission (the
”SEC”) thereunder, and other applicable rules and
regulations of the SEC and/or upon such other exemption from the
registration requirements of the Securities Act as may be available
with respect to the transactions contemplated hereby.
C. At
any time when any amount of principal or interest of the Notes
shall be outstanding, such unpaid amounts shall be convertible into
shares of the Issuer’s, at the election of the Purchaser,
Common Stock at a price per share equal to the average closing bid
price of a share of the Issuer’s Common stock for the five
(5) trading days prior to the Closing, as defined herein (the
“Conversion Price”).
D. The
Warrants shall be issued at the same time each Note is issued to
the Purchaser hereunder and shall be exercisable at $0.50 per share
as the Conversion Price (the “Exercise Price”), for
such number of shares equal to 50% of result obtained by dividing
(i) the face amount of the Notes issued simultaneously with the
Warrant by (ii) the Conversion Price (the “Exercisable
Amount”).
AGREEMENT
NOW THEREFORE,
in consideration of the foregoing recitals, which shall be
considered an integral part of this Agreement, the covenants and
agreements set forth hereafter, and other good and valuable
consideration, the receipt and sufficiency of which is hereby
acknowledged, the Purchasers and the Issuer hereby agree as
follows
1.
Purchase of the Notes and Warrants. On the terms
and subject to the conditions set forth in this Agreement and in
the Notes and Warrants, the Purchasers shall purchase from the
Issuer and the Issuer shall sell to the Purchaser the
Securities.
2.
Purchaser’s Representations, Warranties and Covenants.
In order to induce the Issuer to sell and issue the Securities to
the Purchaser under one or more exemptions from registration under
the Securities Act, the Purchasers, severally and not jointly,
represent and warrant to the Issuer, and covenant with the Issuer,
that:
(a) (i)
Such Purchaser has the requisite power and authority to enter into
and perform this Agreement, and each of the other agreements
entered into by the parties hereto in connection with the
transactions contemplated by this Agreement (collectively, the
"Transaction Documents"), and to purchase the Securities in
accordance with the terms hereof and thereof.
(ii) The
execution and delivery of the Transaction Documents by the
Purchaser and the consummation by it of the transactions
contemplated thereby have been duly and validly authorized by the
Purchaser's organizational documents and no further consent or
authorization is required by the Purchaser.
(iii) The
Transaction Documents have been duly and validly executed and
delivered by the Purchaser.
(iv) The
Transaction Documents, and each of them, constitutes the valid and
binding obligation of the Purchaser enforceable against the
Purchaser in accordance with their respective terms, except as such
enforceability may be limited by general principles of equity or
applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation or similar laws relating to, or affecting generally,
the enforcement of creditors' rights and remedies.
(b) The
execution, delivery and performance of the Transaction Documents by
the Purchaser and the consummation by the Purchaser of the
transactions contemplated thereby will not conflict with or
constitute a default under any agreement or instrument to which the
Purchaser is a party or by which the Purchaser is bound.
(c) The
Purchaser is acquiring the Securities for investment for its own
account, and not with a view toward distribution thereof, and with
no present intention of dividing its interest with others or
reselling or otherwise transferring or disposing all or any portion
of either the Notes or Warrants. The undersigned has not offered or
sold a participation in this purchase of either the Notes or
Warrants, and will not offer or sell any interest therein. The
Purchaser further acknowledges that the Purchaser does not have in
mind any sale of either the Notes or Warrants currently or after
the passage of a fixed or determinable period of time or upon the
occurrence or non-occurrence of any predetermined events or
consequence; and that it has no present or contemplated agreement,
undertaking, arrangement, obligation, indebtedness or commitment
providing for or which is likely to compel a disposition of either
the Notes or Warrants and is not aware of any circumstances
presently in existence that are likely in the future to prompt a
disposition thereof.
(e) The
Purchaser acknowledges that the Securities have been offered to it
in direct communication between itself and the Issuer and not
through any advertisement of any kind.
(f) The
Purchaser acknowledges that the Issuer has given it access to all
information relating to the Issuer’s business that it has
requested. The Purchaser has reviewed all materials
relating to the Issuer's business, finance and operations which it
has requested and the Purchaser has reviewed all of such materials
as the Purchaser, in the Purchaser’s sole and absolute
discretion shall have deemed necessary or desirable. The Purchaser
has had an opportunity to discuss the business, management and
financial affairs of the Issuer with the Issuer's
management. Specifically but not by way of
limitation, the Purchaser acknowledges the Issuer’s publicly
available filings made periodically with the SEC, which filings are
available at www.sec.gov and which filings the Purchaser
acknowledges reviewing or having had the opportunity of
reviewing.
(g) The Purchaser acknowledges that it has, by
reason of its business and financial experience, such knowledge,
sophistication and experience in financial and business matters and
in making investment decisions of this type that it is capable of
(i) evaluating the merits and risks of an investment in the
Securities and making an informed investment decision in connection
therewith; (ii) protecting its own interest; and (iii) bearing the
economic risk of such investment for an indefinite period of time
for Securities which are not transferable or freely
tradable. The undersigned hereby agrees to indemnify the
Issuer thereof and to hold each of such persons and entities, and
the officers, directors and employees thereof harmless against all
liability, costs or expenses (including reasonable attorneys’
fees) arising by reason of or in connection with any
misrepresentation or any breach of warranties of the undersigned
contained in this Agreement, or arising as a result of the sale or
distribution of the Securities or the Common Stock issuable upon
conversion of the Notes or exercise of the Warrants, by the
undersigned in violation of the Securities Act, the Securities
Exchange Act of 1934, as amended (the “Exchange Act”),
or any other applicable law, either federal or
state. This subscription and the representations and
warranties contained herein shall be binding upon the heirs, legal
representatives, successors and assigns of the
Purchaser.
(h) The Purchaser is familiar with the
definition of an "accredited investor" as that term is defined in
Rule 501(a) of Regulation D of the Securities Act and represents
and warrants to the Issuer that it is an accredited investor as so
defined. If the Purchaser is not a resident of the
United States, the Purchaser is not a “U.S. person[s]”
as that term is defined in Rule 902 of Regulation S
promulgated under the Securities Act of 1933, as
amended.
(i) During the
term of this Agreement and the other Transaction Documents, the
Purchaser
