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WARRANT TO PURCHASE COMMON STOCK

Warrant Agreement

WARRANT TO PURCHASE COMMON STOCK | Document Parties: Avenue, Suite 110, Westminster, CO | MAG Capital, LLC | Street, Boulder, CO | SUNFUELS, INC You are currently viewing:
This Warrant Agreement involves

Avenue, Suite 110, Westminster, CO | MAG Capital, LLC | Street, Boulder, CO | SUNFUELS, INC

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Title: WARRANT TO PURCHASE COMMON STOCK
Governing Law: New York     Date: 7/24/2007
Law Firm: Latham Watkins;Faegre Benson    

WARRANT TO PURCHASE COMMON STOCK, Parties: avenue  suite 110  westminster  co , mag capital  llc , street  boulder  co , sunfuels  inc
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Exhibit 10.41

WARRANT TO PURCHASE COMMON STOCK

THIS WARRANT AND THE SECURITIES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR THE AVAILABILITY OF AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

WARRANT TO PURCHASE COMMON STOCK

 

Number of Shares:    185,185 Shares (subject to adjustment)
Warrant Price:    $22.75 per Share
Issuance Date:    January 26, 2007
Expiration Date:    January 25, 2010

THIS WARRANT CERTIFIES THAT for value received, Asset Managers International Limited, or its registered assigns (hereinafter called the “ Holder ”) is entitled to purchase from SunFuels, Inc., a Colorado corporation (hereinafter called the “ Company ”), the above referenced number of fully paid and nonassessable shares (the “ Shares ”) of common stock, no par value (the “ Common Stock ”) of Company, at the Warrant Price per Share referenced above; the number of shares purchasable upon exercise of this Warrant referenced above being subject to adjustment from time to time as described herein. This Warrant is issued in connection with that certain Subscription Agreement dated as of January 26, 2007, by and among the Company and M.A.G. Capital, LLC, Mercator Momentum Fund, LP, Mercator Momentum Fund III, LP, the accredited investors signatories thereto, and Holder. The exercise of this Warrant shall be subject to the provisions, limitations and restrictions contained herein.

1. Term and Exercise .

1.1 Term . This Warrant is exercisable in whole or in part (but not as to any fractional share of Common Stock), at any time and from time to time after the date that is six months after the Issuance Date but prior to 6:00 p.m. (New York Time) on the Expiration Date set forth above.

1.2 Warrant Price . The Warrant shall be exercisable at the Warrant Price referenced above.

1.3 Maximum Number of Shares . The maximum number of Shares of Common Stock exercisable pursuant to this Warrant is 185,185 Shares, subject to adjustment as set forth herein. Notwithstanding anything herein to the contrary, in no event shall the Holder be permitted to exercise this Warrant for a number of Shares greater than the number that would cause the aggregate beneficial ownership of the Company’s Common Stock (calculated pursuant to Rule 13d-3 of the Securities Exchange Act of 1934, as amended) of the Holder and all persons affiliated with the Holder to equal 9.99% or more of the Company’s Common Stock then outstanding; provided that the Holder shall be responsible for any calculation required for compliance with such 9.99% limit.

1.4 Procedure for Exercise of Warrant . Holder may exercise this Warrant by delivering the following to the principal office of the Company in accordance with Section 5.1 hereof: (i) a duly executed Notice of Exercise in substantially the form attached as Schedule A, (ii) payment of the Warrant Price then in effect for each of the Shares being purchased, as designated in the Notice of Exercise, and (iii) this Warrant. Payment of the Warrant Price may be in cash, certified or official bank check payable to the order of the Company, or wire transfer of funds to the Company’s account (or any combination of any of the foregoing) in the amount of the Warrant Price for each share being purchased.

1.5 Delivery of Certificate and New Warrant . In the event of any exercise of the rights represented by this Warrant, a certificate or certificates for the shares of Common Stock so purchased, registered in the name of the Holder or such other name or names as may be designated by the Holder, together with any other securities or other property which the Holder is entitled to receive upon exercise of this Warrant, shall be delivered to the Holder hereof, at the Company’s expense, within a reasonable time, not exceeding five (5) trading days, after the rights represented by this Warrant shall have been so exercised; and, unless this Warrant has expired, a new Warrant representing the number of Shares (except a remaining fractional share), if any, with respect to which this Warrant shall not then have been exercised shall also be issued to the Holder hereof within such time. The person in whose name any certificate for shares of Common Stock is issued upon exercise of this Warrant shall for all purposes be deemed to have become the holder of record of such shares on the date on which the Warrant was surrendered and payment of the Warrant Price was received by the Company, irrespective of the date of delivery of such certificate, except that, if the date of such surrender and payment is on a date when the stock transfer books of the Company are closed, such person shall be deemed to have become the holder of such Shares at the close of business on the next succeeding date on which the stock transfer books are open.

1.6 Restrictive Legend . Each certificate for Shares shall bear a restrictive legend in substantially the form as follows, together with any additional legend required by (i) any applicable state securities laws and (ii) any securities exchange upon which such Shares may, at the time of such exercise, be listed:

“The shares represented by this certificate have not been registered under the Securities Act of 1933, as amended and may not be sold, offered for sale, transferred or pledged in the absence of such registration or an exemption therefrom under such Act.”

Any certificate issued at any time in exchange or substitution for any certificate bearing such legend shall also bear such legend unless, in the opinion of counsel for the Holder thereof (which counsel shall be reasonably satisfactory to the Company), the securities represented thereby are not, at such time, required by law to bear such legend.

1.7 Fractional Shares . No fractional Shares shall be issuable upon exercise or conversion of the Warrant. If a fractional share interest arises upon any exercise or conversion of the Warrant, the Company shall round up the number of Shares to be issued to the nearest whole Share and the Holder shall increase the consideration due upon exercise by an amount computed by multiplying such fractional interest by the Warrant Price of a full Share then in effect.

 


2. Representations, Warranties and Covenants .

2.1 Representations and Warranties .

(a) The Company is a corporation duly organized, validly existing and in good standing under the laws of its state of incorporation and has all necessary power and authority to perform its obligations under this Warrant;

(b) The execution, delivery and performance of this Warrant has been duly authorized by all necessary actions on the part of the Company and constitutes the legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms; and

(c) This Warrant does not violate and is not in conflict with any of the provisions of the Company’s Amended and Restated Articles of Incorporation, Certificate of Designations, Bylaws and any resolutions of the Company’s Board of Directors or stockholders, or any agreement of the Company, and no event has occurred and no condition or circumstance exists that might (with or without notice or lapse of time) constitute or result directly or indirectly in such a violation or conflict.

2.2 Issuance of Shares . The Company covenants and agrees that all shares of Common Stock that may be issued upon the exercise of the rights represented by this Warrant will, upon issuance, be validly issued, fully paid and nonassessable, and free from all taxes, liens and charges with respect to the issue thereof and shall be listed on any exchanges on which the Common Stock is then listed. The Company further covenants and agrees that it will pay when due and payable any and all federal and state taxes which may be payable in respect of the issue of this Warrant or any Common Stock or certificates therefor issuable upon the exercise of this Warrant excluding the Holder’s income and other taxes not directly relating to the issuance of the Warrant or Common Stock. The Company further covenants and agrees that the Company will at all times have authorized and reserved, free from preemptive rights, a sufficient number of shares of Common Stock to provide for the exercise in full of the rights represented by this Warrant. If at any time the number of authorized but unissued shares of Common Stock of the Company shall not be sufficient to effect the exercise of the Warrant in full, subject to the limitations set forth in Section 1.3 hereto, then the Company will take all such corporate action as may, in the opinion of counsel to the Company, be necessary or advisable to increase the number of its authorized shares of Common Stock as shall be sufficient to permit the exercise of the Warrant in full, subject to the limitations set forth in Section 1.3 hereto, including without limitation, using its best efforts to obtain any necessary stockholder approval of such increase. The Company further covenants and agrees that if any shares of capital stock to be reserved for the purpose of the issuance of shares upon the exercise of this Warrant require registration with or approval of any governmental authority under any federal or state law before such shares may be validly issued or delivered upon exercise, then the Company will in good faith and as expeditiously as possible endeavor to secure such registration or approval, as the case may be. If and so long as the Common Stock issuable upon the exercise of this Warrant is listed on any national securities exchange or the Nasdaq Stock Market, the Company will, if permitted by the rules of such exchange or market, list and keep listed on such exchange or market, upon official notice of issuance, all shares of such Common Stock issuable upon exercise of this Warrant.

3. Other Adjustments .

3.1 Subdivision or Combination of Shares . In case the Company shall at any time subdivide its outstanding Common Stock into a greater number of shar


 
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