THE
SECURITIES REPRESENTED BY THIS DOCUMENT HAVE NOT BEEN REGISTERED
WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”),
AND ARE ‘RESTRICTED SECURITIES’ AS THAT TERM IS DEFINED
IN RULE 144 UNDER THE 1933 ACT. THE SECURITIES MAY NOT
BE OFFERED FOR SALE, SOLD OR OTHERWISE TRANSFERRED EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, OR
PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE 1933 ACT, THE
AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF
THE COMPANY THROUGH REASONABLE MEANS AS DETERMINED BY THE COMPANY,
INCLUDING AN OPINION OF SELLER’S COUNSEL REASONABLY
ACCEPTABLE TO THE COMPANY.
ZULU ENERGY CORP.
COMMON STOCK PURCHASE
WARRANT
THIS COMMON STOCK WARRANT AGREEMENT
(the “Agreement”) is
made and entered into as of the _____ day of ________, 2009 by and
between Zulu Energy Corp., a Colorado corporation (the
“Company”), and __________ (the
“Holder”).
WITNESSETH
:
WHEREAS , pursuant to the Securities Purchase Agreement
dated as of February __, 2009 between the Company and Holder (the
“Agreement”), Holder agreed to purchase from the
Company, and the Company agreed to sell and issue to the Holder,
Units consisting of shares of the common stock of the Company
$0.001 par value per share (the “Common Stock”) and
warrants to purchase shares of Common Stock with such warrant to be
for the number of shares, at the price per share and on the terms
set forth in this Agreement; and
WHEREAS , the Holder desires to receive a warrant on the
terms and conditions set forth in this Agreement.
NOW, THEREFORE , the parties agree as follows:
1.
Grant of Warrant . The Company hereby grants to
the Holder the right and warrant (the “Warrant”) to
purchase all or any part of an aggregate of ______ shares of the
authorized and unissued Common Stock of the Company (the
“Warrant Shares”) subject to adjustment as provided in
this Agreement, pursuant to the terms and conditions set forth in
this Agreement.
2.
Warrant Price . At any time when shares are to be
purchased pursuant to this Agreement, the purchase price for each
Warrant Share shall be $0.50 (the “Warrant Price”),
subject to adjustment as provided in this Agreement.
(a) The
Warrant may be exercised in whole or in part by delivering to the
President of the Company at the address of the Company’s
principal office (i) a Notice and Agreement of Exercise of Warrant,
substantially in the form attached hereto as Exhibit A ,
specifying the number of Warrant Shares with respect to which the
Warrant is exercised, and (ii) full payment of an amount equal to
the Warrant Price multiplied by the number of Warrant Shares then
being purchased (such aggregate amount of money, the
“Purchase Price”). Payment shall be made by
certified check or cleared funds. The Warrant may not be
exercised in part unless the purchase price for the Warrant Shares
purchased is at least $1,000 or unless the entire remaining portion
of the Warrant is being exercised.
(b) Promptly
upon receipt of the Notice and Agreement of Exercise of Warrant
together with the full payment of the Purchase Price, the Company
shall deliver to the Holder a properly executed certificate or
certificates representing the Warrant Shares being
purchased.
5.
Withholding Taxes . The Company may take such
steps as it deems necessary or appropriate for the withholding of
any taxes which the Company is required by any law or regulation or
any governmental authority, whether federal, state or local,
domestic or foreign, to withhold in connection with the Warrant
including, but not limited to, the withholding of all or any
portion of any payment owed by the Company to the Holder or the
withholding of issuance of Warrant Shares to be issued upon the
exercise of the Warrant.
6.
Securities Laws Requirements . The issuance of
the Warrant has not been registered under the Securities Act of
1933, as amended (the “1933 Act”), in reliance upon an
exemption from registration. In addition, no Warrant
Shares shall be issued unless and until, in the opinion of the
Company, there has been full compliance with, or an exemption from,
any applicable registration requirements of the 1933 Act, any
applicable listing requirements of any securities exchange on which
stock of the same class has been listed, and any other requirements
of law or any regulatory bodies having jurisdiction over such
issuance and delivery. The Holder hereby acknowledges,
represents, warrants and agrees as follows, and, pursuant to the
terms of the Notice and Agreement of Exercise of Warrant (Exhibit
A) that shall be delivered to the Company upon each exercise of the
Warrant, the Holder shall acknowledge, represent, warrant and agree
as follows:
(a) Holder
is acquiring the Warrant and the Warrant Shares for investment
purposes only and the Warrant and the Warrant Shares that Holder is
acquiring will be held by Holder without sale, transfer or other
disposition for an indefinite period unless the transfer of those
securities is subsequently registered under the federal securities
laws or unless exemptions from registration are
available;
(b) Holder’s
overall commitment to investments that are not readily marketable
is not disproportionate to Holder’s net worth, and
Holder’s investment in the Warrant and the Warrant Shares
will not cause such overall commitments to become
excessive;
(c) Holder’s
financial condition is such that Holder is under no present or
contemplated future need to dispose of any portion of the Warrant
or the Warrant Shares to satisfy any existing or contemplated
undertaking, need or indebtedness;
(d) Holder
has sufficient knowledge and experience in business and financial
matters to evaluate, and Holder has evaluated, the merits and risks
of an investment in the Warrant and the Warrant Shares;
(e) The
address set forth on the signature page to this
Agreement is Holder’s true and correct residence,
and Holder has no present intention of becoming a resident of any
other state or jurisdiction;
(f) Holder
confirms that all documents, records and books pertaining to an
investment in the Warrant and the Warrant Shares that have been
requested by Holder have been made available or delivered to the
Holder. Holder has had the opportunity to discuss the
acquisition of the Warrant and the Warrant Shares with the
Company. Holder also confirms that it has obtained or
been given access to all information concerning the Company that
Holder has requested;
(g) Holder
has had the opportunity to ask questions of, and receive the
answers from, the officers and directors of the Company concerning
the terms of Holder’s investment in the Warrant and the
Warrant Shares and to receive additional information necessary to
verify the accuracy of the information delivered to Holder, to the
extent that the Company possesses such information or can acquire
it without unreasonable effort or expense;
(h) Holder
understands that the Warrant has not been, and the Warrant Shares
issuable upon exercise of the Warrant will not be, registered under
the 1933 Act or any state securities laws in reliance on an
exemption for private offerings, and no federal or state agency has
made any finding or determination as to the fairness of this
investment or any recommendation or endorsement of the issuance of
the Warrant or the Warrant Shares;
(i) The
Warrant and the Warrant Shares that Holder is acquiring will be
solely for Holder’s own account, for investment, and are not
being purchased with a view to or for the resale, distribution,
subdivision or fractionalization thereof. Holder has no
agreement or arrangement for any such resale, distribution,
subdivision or fractionalization thereof;
(j) Holder
acknowledges and is aware of the following:
(i) The
Company has a history of losses. The Warrant and the
Warrant Shares constitute a speculative investment and involve a
high degree of risk of loss by Holder of Holder’s total
investment in the Warrant and the Warrant Shares.
(ii) That: (a)
following the filing of the Company’s Quarterly Report on
Form 10-Q with the Securities and Exchange Commission on November
19, 2008, the Company’s financial condition deteriorated and
as of the date of this Warrant may not have improved; (b) the
Company may not have substantial cash on-hand; (c) the
Company’s liabilities may substantially exceed the
Company’s cash assets; (d) the Company may urgently needs
funds to continue in existence; (e) the Company will need
substantial additional financing to pursue its business plan; and
(f) there is no assurance that the Holder will receive any return
on its investment.
(iii) There
are substantial restrictions on the transferability of the Warrant
and the Warrant Shares. The Warrant is not
transferable. The Warrant Shares cannot be transferred,
pledged, hypothecated, sold or otherwise disposed of unless they
are registered under the 1933 Act or an exemption from such
registration is available and established to the satisfaction of
the Company; except as set forth in the Subscription Agreement,
investors in the Company have no rights to require that the Warrant
Shares be registered; there is no right of presentment
