NEITHER THIS
WARRANT NOR THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF
THIS WARRANT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AND NEITHER THIS WARRANT NOR SUCH SHARES MAY BE SOLD, ENCUMBERED OR
OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER SUCH ACT OR AN EXEMPTION FROM SUCH REGISTRATION
REQUIREMENT, AND, IF AN EXEMPTION SHALL BE APPLICABLE, THE HOLDER
SHALL HAVE DELIVERED AN OPINION OF COUNSEL ACCEPTABLE TO THE
COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
Void after
5:00 P.M. Eastern Standard Time on the last day of the Termination
Date, as defined in the Warrant
COMMON STOCK PURCHASE
WARRANT
OF
ELEMENT 21 GOLF
COMPANY
This is to certify that, FOR VALUE RECEIVED,
,
or his/her/its assigns (“Holder”), is entitled to
purchase, subject to the provisions of this Warrant, from Element
21 Golf Company, a Delaware corporation (the
“Company”), at an exercise price per share equal to the
Per Share Price (as defined below) subject to adjustment as
provided in this Warrant (such price as adjusted from time to time
in accordance herewith, the “Exercise Price”), such
number of shares of the Company’s Common Stock, par value
$0.01 per share (“Common Stock”) as shall be equal to
the Warrant Exercise Number (as defined below). The
shares of Common Stock deliverable upon such exercise, and as
adjusted from time to time, are hereinafter sometimes referred to
as “Warrant Shares”. The term “Per Share
Price” shall mean 35 CENTS . The term “Warrant
Exercise Number” shall mean as of any determination date $
300,000 [AMOUNT EQUAL TO 100% OF NOTE INVESTMENT AMOUNT]
divided by the Per Share Price.
1. DEFINED TERMS
. Capitalized terms not otherwise defined in this
Warrant shall have meaning ascribed to such term in that certain
Subscription Agreement dated as of the date hereof between the
Company and the Holder.
(a) This Warrant may be exercised in
whole or in part at any time or from time to time from the date of
origination of the Convertible Note and prior to the Termination
Date by presentation and surrender hereof to the Company at its
principal office, or at the office of its stock transfer agent, if
any, with the Purchase Form annexed hereto duly executed and
accompanied by payment of the Exercise Price for the number of
shares of Common Stock specified in such form. If this
Warrant should be exercised in part only, the Company shall, upon
surrender of this Warrant for cancellation, execute and deliver a
new Warrant evidencing the rights of the Holder hereof to purchase
the balance of the shares of Common Stock purchasable
hereunder. Upon receipt by the Company of this Warrant
at its office, or by the stock transfer agent of the Company at its
office, in proper form for exercise, the Holder shall be deemed to
be the holder of record of the shares of Common Stock issuable upon
such exercise, notwithstanding that the stock transfer books of the
Company shall then be closed or that certificates representing such
shares of Common Stock shall not then be actually delivered to the
Holder. As used herein, the term “Initial Exercise
Date” shall mean the date upon which this warrant was first
issued by the Company to the Holder and the term “Termination
Date” shall mean the twelve (12) months anniversary of the
Initial Exercise Date.
3. EXCHANGE, TRANSFER, ASSIGNMENT OR LOSS
OF WARRANT . This Warrant is exchangeable,
without expense, at the option of the Holder, upon presentation and
surrender hereof to the Company or at the office of its stock
transfer agent, if any, for other Warrants of different
denominations entitling the holder thereof to purchase in the
aggregate the same number of shares of Common Stock purchasable
hereunder. Subject to the provisions of Section 8 of
this Warrant, upon surrender of this Warrant to the Company or at
the office of its stock transfer agent, if any, with the Assignment
Form annexed hereto duly executed and funds sufficient to pay any
transfer tax, the Company shall, without charge, execute and
deliver a new Warrant in the name of the assignee named in such
instrument of assignment and this Warrant shall promptly be
canceled. This Warrant may be divided or combined with
other Warrants which carry the same rights upon presentation hereof
at the office of the Company or at the office of its stock transfer
agent, if any, together with a written notice specifying the names
and denominations in which new Warrants are to be issued and signed
by the Holder hereof. The term “Warrant” as
used herein includes any Warrants into which this Warrant may be
divided or exchanged. Upon receipt by the Company of
evidence satisfactory to it of the loss, theft, destruction or
mutilation of this Warrant, and (in the case of loss, theft or
destruction) of reasonably satisfactory indemnification, and upon
surrender and cancellation of this Warrant, if mutilated, the
Company will execute and deliver a new Warrant of like
tenor. Any such new Warrant executed and delivered shall
constitute an additional contractual obligation on the part of the
Company, whether or not this Warrant so lost, stolen, destroyed, or
mutilated shall be at any time enforceable by anyone.
4. RIGHTS OF THE HOLDER
. The Holder shall not, by virtue of this Warrant, be
entitled to any rights of a stockholder in the Company, either at
law or equity, and the rights of the Holder are limited to those
expressed in the Warrant and are not enforceable against the
Company except to the extent set forth herein.
5. ANTI-DILUTION PROVISIONS
. The Exercise Price in effect at any time and the
number and kind of securities purchasable upon exercise of each
Warrant shall be subject to adjustment as follows:
(a) In case the
Company shall (1) pay a dividend or make a distribution on its
shares of Common Stock in shares of Common Stock (2) subdivide or
reclassify its outstanding Common Stock into a greater number of
shares, or (3) combine or reclassify its outstanding Common Stock
into a smaller number of shares or otherwise effect a reverse
split, the Exercise Price in effect at the time of the record date
for such dividend or distribution or of the effective date of such
subdivision, combination or reclassification shall be
proportionately adjusted so that the Holder of this Warrant
exercised after such date shall be entitled to receive the
aggregate number and kind of shares which, if this Warrant had been
exercised immediately prior to such time, he would have owned upon
such exercise and been entitled to receive upon such dividend,
subdivision, combination or reclassification. Such
adjustment shall be made successively whenever any event listed in
this Section 5(a) shall occur.
(b) In case the Company shall distribute to all
holders of Common Stock evidences of its indebtedness or assets
(excluding cash dividends or distributions paid out of current
earnings and dividends or distributions referred to in Section 7(a)
of this Warrant or subscription rights or warrants), then in each
such case the Exercise Pric
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