EXHIBIT 4.5
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NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS EXERCISABLE
HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE
SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO
SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS
SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER
LOAN SECURED BY SUCH SECURITIES
SERIES C WARRANT
To Purchase $________ Principal Amount of Series A Debentures and Series A
Warrants
WESTERN POWER & EQUIPMENT CORP.
THIS SERIES C WARRANT (the "Warrant") certifies that, for value received,
_____________ (the "Holder"), is entitled, upon the terms and subject to the
limitations on exercise and the conditions hereinafter set forth, at any time on
or after the date hereof (the "Initial Exercise Date") and on or prior to the
earlier of the close of business on (i) the 18 month anniversary of the
Effective Date and (ii) the three year anniversary of the date hereof (the
"Termination Date") but not thereafter, to subscribe for and purchase from
Western Power & Equipment Corp., a Delaware corporation (the "Company"), at face
value (a) up to $_____________[AMOUNT EQUAL TO 25% OF HOLDER'S SERIES A
SUBSCRIPTION AMOUNT] principal amount of a Series A Debenture at an initial
conversion price equal to the then Conversion Price of the Series A Debenture
(the "Debenture Conversion Price") (subject to adjustment hereunder and
thereunder) (the "Debenture") and (b) Series A Warrants at an exercise price of
equal to the then Exercise Price of the Series A Warrant (the "Warrant Exercise
Price") (subject to adjustment hereunder and thereunder) (the "Warrant"). Upon
the purchase hereunder of Debenture, the Holder shall receive a Warrant to
purchase a number of shares of Common Stock equal to 35% of the shares of Common
Stock issuable upon conversion in full of such Debenture. The Debenture and
Warrant shall be in the form of the Series A Debenture and Series A Warrants
(with the same rights, privileges and preferences set forth in the Transaction
Documents, including without limitation, the Series A Debentures and the Series
A Warrant) issued pursuant to the Purchase Agreement, MUTATIS MUTANDIS. The
Debenture and the Warrant shall be collectively referred to as the "Securities."
The Warrant Exercise Price and the Debenture Conversion Price shall be
collectively referred to herein as the "Conversion Price."
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Section 1. Definitions. Capitalized terms used and not otherwise defined
herein shall have the meanings set forth in that certain Securities Purchase
Agreement (the "Purchase Agreement"), dated June 8, 2005, among the Company and
the Purchasers signatory thereto.
Section 2. Exercise.
a) Exercise of this Warrant. Exercise of the purchase rights
represented by this Warrant may be made, in whole or in part, at any time or
times on or after the Initial Exercise Date and on or before the Termination
Date by delivery to the Company of a duly executed facsimile copy of the Notice
of Exercise Form annexed hereto (or such other office or agency of the Company
as it may designate by notice in writing to the registered Holder at the address
of such Holder appearing on the books of the Company) and the payment of the
aggregate principal amount of the Debenture thereby purchased by wire transfer
or cashier's check drawn on a United States bank. Upon exercise of the Warrant,
the Company shall issue a Debenture with a principal amount equal to 25% of the
initial principal amount of such Holder's Series A Debenture, as issued pursuant
to the Purchase Agreement and the Warrant to purchase a number of shares of
Common Stock equal to 35% of the shares of Common Stock issuable upon conversion
of such Debenture.
b) Mechanics of Exercise.
i. Authorization of Debenture and the Warrant. The Company covenants
that during the period this Warrant is outstanding, it will reserve from
its authorized and unissued Common Stock a sufficient number of shares to
provide for the issuance of all of the shares of Common Stock underlying
the Debenture and Warrant (the collectively, "Conversion Shares"). The
Company further covenants that its issuance of this Warrant shall
constitute full authority to its officers who are charged with the duty of
executing certificates to execute and issue the necessary certificates for
the Securities upon the exercise of the purchase rights under this Warrant
and certificates upon conversion and exercise of the Securities. The
Company covenants that the Securities which may be issued upon the exercise
of the purchase rights represented by this Warrant and the Conversion
Shares issuable thereunder will, upon exercise of the purchase rights
represented by this Warrant, be duly authorized, validly issued, fully paid
and nonassessable and free from all taxes, liens and charges in respect of
the issue thereof (other than taxes in respect of any transfer occurring
contemporaneously with such issue). The Company will take all such
reasonable action as may be necessary to assure that the Securities and
Conversion Shares may be issued as provided herein without violation of any
applicable law or regulation, or of any requirements of the Trading Market
upon which the Common Stock may be listed.
ii. Delivery of Certificates Upon Exercise. Certificates for the
Securities purchased hereunder shall be delivered to the Holder within 5
Trading Days from the delivery to the Company of the Notice of Exercise
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Form and surrender of this Warrant ("Securities Delivery Date"), provided
that such delivery and surrender occurs before 12:00 Noon EST on such date.
This Warrant shall be deemed to have been exercised on the date the payment
of the Exercise Price is received by the Company. The Securities shall be
deemed to have been issued, and Holder or any other person so designated to
be named therein shall be deemed to have become a holder of record of such
security for all purposes, as of the date the Warrant has been exercised by
payment to the Company of the Exercise Price and all taxes required to be
paid by the Holder, if any, pursuant to Section 2(b)(v) prior to the
issuance of such security, have been paid.
iii. Delivery of New Warrants Upon Exercise. If this Warrant shall
have been exercised in part, the Company shall, at the time of delivery of
the certificate or certificates representing the Securities, deliver to
Holder a new Warrant evidencing the rights of Holder to purchase the
unpurchased Securities called for by this Warrant, which new Warrant shall
in all other respects be identical with this Warrant.
iv. Rescission Rights. If the Company fails to deliver to the Holder
a certificate or certificates representing the Securities pursuant to this
Section 2(b)(iv) by the Securities Delivery Date, then the Holder will have
the right to rescind such exercise.
v. Charges, Taxes and Expenses. Issuance of certificates for
Securities shall be made without charge to the Holder for any issue or
transfer tax or other incidental expense in respect of the issuance of such
certificate, all of which taxes and expenses shall be paid by the Company,
and such certificates shall be issued in the name of the Holder or in such
name or names as may be directed by the Holder; provided, however, that in
the event certificates for Securities are to be issued in a name other than
the name of the Holder, this Warrant when surrendered for exercise shall be
accompanied by the Assignment Form attached hereto duly executed by the
Holder; and the Company may require, as a condition thereto, the payment of
a sum sufficient to reimburse it for any transfer tax incidental thereto.
vi. Closing of Books. The Company will not close its records in any
manner which prevents the timely exercise of this Warrant, pursuant to the
terms hereof or the conversion of the Securities pursuant to the terms
hereof.
Section 3. Certain Adjustments.
a) Stock Dividends and Splits. If the Company, at any time while this
Warrant is outstanding: (A) pays a stock dividend or otherwise make a
distribution or distributions on shares of its Common Stock or any other equity
or equity equivalent securities payable in shares of Common Stock (which, for
avoidance of doubt, shall not
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include any shares of Common Stock issued by the Company pursuant to the
Securities), (B) subdivides outstanding shares of Common Stock into a larger
number of shares, (C) combines (including by way of reverse stock split)
outstanding shares of Common Stock into a smaller number of shares, or (D)
issues by reclassification of shares of the Common Stock any shares of capital
stock of the Company, then in each case the Conversion Price shall be multiplied
by a fraction of which the numerator shall be the number of shares of Common
Stock (excluding treasury shares, if any) outstanding immediately before such
event and of which the denominator shall be the number of shares of Common Stock
outstanding immediately after such event. Any adjustment made pursuant to this
Section 3(a) shall become effective immediately after the record date for the
determination of stockholders entitled to receive such dividend or distribution
and shall become effective immediately after the effective date in the case of a
subdivision, combination or re-classification.
b) Subsequent Equity Sales. If the Company or any Subsidiary thereof,
as applicable, at any time while this Warrant is outstanding, shall offer, sell,
grant any option to purchase or offer, sell or grant any right to reprice its
securities, or otherwise dispose of or issue (or announce any offer, sale, grant
or any option to purchase or other disposition) any Common Stock or Common Stock
Equivalents entitling any Person to acquire shares of Common Stock, at an
effective price per share less than the then Conversion Price (such lower price,
the "Base Share Price" and such issuances collectively, a "Dilutive Issuance"),
as adjusted hereunder (if the holder of the Common Stock or Common Stock
Equivalents so issued shall at any time, whether by operation of purchase price
adjustments, reset provisions, floating conversion, exercise or exchange prices
or otherwise, or due to warrants, options or rights per share which is issued in
connection with such issuance, be entitled to receive shares of Common Stock at
an effective price per share which is less than the Conversion Price, such
issuance shall be deemed to have occurred for less than the Conversion Price on
such date of the Dilutive Issuance), then, the Conversion Price shall be reduced
and only reduced to equal the Base Share Price and the number of shares of
Common Stock issuable upon exercise of the Warrant issuable hereunder shall be
increased such that the aggregate Warrant Exercise Price payable hereunder,
after taking into account the decrease in the Warrant Exercise Price, shall be
equal to the aggregate Warrant Exercise Price prior to such adjustment. Such
adjustment shall be made whenever such Common Stock or Common Stock Equivalents
are issued. Notwithstanding the foregoing, no adjustments shall be made, paid or
issued under this Section 3(b) in respect of an Exempt Issuance. The Company
shall notify the Holder in writing, no later than the Trading Day following the
issuance of any Common Stock or Common Stock Equivalents subject to this
section, indicating therein the applicable issuance price, or of applicable
reset price, exchange price, conversion price and other pricing terms (such
notice the "Dilutive Issuance Notice"). For purposes of clarification, whether
or not the Company provides a Dilutive Issuance Notice pursuant to this Section
3(b), upon the occurrence of any Dilutive Issuance, after the date of such
Dilutive Issuance the Holder is entitled to receive a number of securities based
upon the Base Share Price regardless of whether the Holder accurately refers to
the Base Share Price in the Notice of Exercise.
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c) Pro Rata Distributions. If the Company, at any time while this
Warrant is outstanding, but no later than the Termination Date, distributes to
all holders of Common Stock (and not to Holders) evidences of its indebtedness
or assets (including cash and cash dividends) or rights or warrants to subscribe
for or purchase any security other than the Common Stock (which shall be subject
to Section 3(b), then in each such case the Conversion Price shall be adjusted
by multiplying such Conversion Price in effect immediately prior to the record
date fixed for determination of stockholders entitled to receive such
distribution by a fraction of which the denominator shall be the VWAP determined
as of the record date mentioned above, and of which the numerator shall be such
VWAP on such record date less the then per share fair market value at such
record date of the portion of such assets or evidence of indebtedness so
distributed applicable to one outstanding share of the Common Stock as
determined by the Board of Directors in good faith. In either case the
adjustments shall be described in a statement provided to the Holder of the
portion of assets or evidences of indebtedness so distributed or such
subscription rights applicable to one share of Common Stock. Such adjustment
shall be made whenever any such distribution is made and shall become effective
immediately after the record date mentioned above.
d) Fundamental Transaction. If, at any time while this Warrant is
outstanding, (A) the Company effects any merger or consolidation of the Company
with or into another Person, (B) the Company effects any sale of all or
substantially all of its assets in one or a series of related transactions, (C)
any tender offer or exchange offer (whether by the Company or another Person) is
completed pursuant to which holders of Common Stock are permitted to tender or
exchange their shares for other securities, cash or property, or (D) the Company
effects any reclassification of the Common Stock or any compulsory share
exchange pursuant to which the Common Stock is effectively converted into or
exchanged for other securities, cash or property (in any such case, a
"Fundamental Transaction"), then, upon any subsequent exercise of this Warrant
the Holder shall have the right to receive upon conversion or exercise of the
Securities, as applicable, for each Conversion Share that would have been
issuable upon such exercise and then subsequent conversion immediately prior to
the occurrence of such Fundamental Transaction, at the option of the Holder, (a)
upon conversion or exercise of the Securities, shares of Common Stock of the
successor or acquiring corporation or of the Company, if it is the surviving
corporation, and any additional consideration (the "Alternate Consideration")
receivable upon or as a result of such reorganization, reclassification, merger,
consolidation or disposition of assets by a Holder of the number of shares of
Common Stock for which the underlying Securities are convertible immediately
prior to such event or (b) if the Company is acquired in an all cash
transaction, cash equal to the value of this Warrant as determined in accordance
with the Black-Scholes option pricing formula. For purposes of any such deemed
conversion, the determination of the Conversion Price shall be appropriately
adjusted to apply to such Alternate Consideration based on the amount of
Alternate Consideration issuable in respect of one share of Common Stock in such
Fundamental Transaction, and the Company shall apportion the Conversion Price
among the Alternate Consideration in a reasonable manner reflecting the relative
value of any different components of the Alternate Consideration. If holders of
Common Stock are given any choice as to the securities, cash or property to be
received in a Fundamental Transaction, then the Holder shall be given the same
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choice as to the Alternate Consideration it receives upon any conversion or
exercise of the Securities underlying this Warrant following such Fundamental
Transaction. To the extent necessary to effectuate the foregoing provisions, any
successor to the Company or surviving entity in such Fundamental Transaction
shall issue to the Holder a new warrant consistent with the foregoing provisions
and evidencing the Holder's right to exercise such warrant right ultimately into
Alternate Consideration. The terms of any agreement pursuant to which a
Fundamental Transaction is effected shall include terms requiring any such
successor or surviving entity to comply with the provisions of this Section 3(d)
and insuring that this Warrant (or any such replacement security) will be
similarly adjusted upon any subsequent transaction analogous to a Fundamental
Transaction.
e) Calculations. All calculations and adjustments to the Conversion
Price under this Section 3 shall be made to the nearest cent or the nearest
1/100th of a share, as the case may be. For purposes of this Section 3, the
number of shares of Common Stock deemed to be issued and outstanding as of a
given date shall be the sum of the number of shares of Common Stock (excluding
treasury shares, if any) issued and outstanding..
f) Voluntary Adjustment By Company. The Company may at any time during
the term of this Warrant reduce the then current Conversion Price to any amount
and for any period of time deemed appropriate by the Board of Directors of the
Company.
g) Notice to Holders.
i. Adjustment to Conversion Price. Whenever the Conversion Price
is adjusted pursuant to this Section 3, the Company shall promptly
mail to each Holder a notice setting forth the Conversion Price
after such adjustment and setting forth a brief statement of the
facts requiring such adjustment.
ii. Notice to Allow Exercise by Xxxxxx. If (A) the Company shall
declare a dividend (or any other distribution) on the Common Stock;
(B) the Company shall declare a special nonrecurring cash dividend
on or a redemption of the Common Stock; (C) the Company shall
authorize the granting to all holders of the Common Stock rights or
warrants to subscribe for or purchase any shares of capital stock of
any class or of any rights; (D) the approval of any stockholders of
the Company shall be required in connection with any
reclassification of the Common Stock, any consolidation or merger to
which the Company is a party, any sale or transfer of all or
substantially all of the assets of the Company, of any compulsory
share exchange whereby the Common Stock is converted into other
securities, cash or property; (E) the Company shall authorize the
voluntary or involuntary dissolution, liquidation or winding up of
the affairs of the Company; then, in each case, the Company shall
cause to be mailed to the Holder at its last address as it shall
appear upon the Warrant Register of the Company, at least 20
calendar days prior to the applicable record or effective date
hereinafter specified, a notice stating (x) the date on which a
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record is to be taken for the purpose of such dividend,
distribution, redemption, rights or warrants, or if a record is not
to be taken, the date as of which the holders of the Common Stock of
record to be entitled to such dividend, distributions, redemption,
rights or warrants are to be determined or (y) the date on which
such reclassification, consolidation, merger, sale, transfer or
share exchange is expected to become effective or close, and the
date as of which it is expected that holders of the Common Stock of
record shall be entitled to exchange their shares of the Common
Stock for securities, cash or other property deliverable upon such
reclassification, consolidation, merger, sale, transfer or share
exchange; provided, that the failure to mail such notice or any
defect therein or in the mailing thereof shall not affect the
validity of the corporate action required to be specified in such
notice. The Holder is entitled to exercise this Warrant during the
20-day period commencing on the date of such notice to the effective
date of the event triggering such notice.
Section 4. Transfer of Warrant.
a) Transferability. Subject to compliance with any applicable
securities laws and the conditions set forth in Sections 5(a) and 4(e) hereof
and to the provisions of Section 4.1 of the Purchase Agreement, this Warrant and
all rights hereunder are transferable, in whole or in part, upon surrender of
this Warrant at the principal office of the Company, together with a written
assignment of this Warrant substantially in the form attached hereto duly
executed by the Holder or its agent or attorney and funds sufficient to pay any
transfer taxes payable upon the making of such transfer. Upon such surrender
and, if required, such payment, the Company shall execute and deliver a new
Warrant or Warrants in the name of the assignee or assignees and in the
denomination or denominations specified in such instrument of assignment, and
shall issue to the assignor a new Warrant evidencing the portion of this Warrant
not so assigned, and this Warrant shall promptly be cancelled. A Warrant, if
properly assigned, may be exercised by a new holder for the purchase of
Securities without having a new Warrant issued.
b) New Warrants. This Warrant may be divided or combined with other
Warrants upon presentation hereof at the aforesaid office of the Company,
together with a written notice specifying the names and denominations in which
new Warrants are to be issued, signed by the Holder or its agent or attorney.
Subject to compliance with Section 4(a), as to any transfer which may be
involved in such division or combination, the Company shall execute and deliver
a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided
or combined in accordance with such notice.
c) Warrant Register. 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 Holder hereof from time to time. The
Company may deem and treat the registered Holder of this Warrant as the absolute
owner hereof for the purpose of any exercise hereof or any distribution to the
Holder, and for all other purposes, absent actual notice to the contrary
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d) Transfer Restrictions. If, at the time of the surrender of this
Warrant in connection with any transfer of this Warrant, the transfer of this
Warrant shall not be registered pursuant to an effective registration statement
under the Securities Act and under applicable state securities or blue sky laws,
the Company may require, as a condition of allowing such transfer (i) that the
Holder or transferee of this Warrant, as the case may be, furnish to the Company
a written opinion of counsel (which opinion shall be in form, substance and
scope customary for opinions of counsel in comparable transactions) to the
effect that such transfer may be made without registration under the Securities
Act and under applicable state securities or blue sky laws, (ii) that the holder
or transferee execute and deliver to the Company an investment letter in form
and substance acceptable to the Company and (iii) that the transferee be an
"accredited investor" as defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7), or
(a)(8) promulgated under the Securities Act or a qualified institutional buyer
as defined in Rule 144A(a) under the Securities Act.
Section 5. Miscellaneous.
a) Title to the Warrant. Prior to the Termination Date and subject to
compliance with applicable laws and Section 4 of this Warrant, this Warrant and
all rights hereunder are transferable, in whole or in part, at the office or
agency of the Company by the Holder in person or by duly authorized attorney,
upon surrender of this Warrant together with the Assignment Form annexed hereto
properly endorsed. The transferee shall sign an investment letter in form and
substance reasonably satisfactory to the Company.
b) No Rights as Shareholder Until Exercise. This Warrant does not
entitle the Holder to any voting rights or other rights as a shareholder of the
Company prior to the exercise hereof. Upon the surrender of this Warrant and the
payment of the aggregate principal, the Securities so purchased shall be and be
deemed to be issued to such Xxxxxx as the record owner of such shares as of the
close of business on the later of the date of such surrender or payment.
c) Loss, Theft, Destruction or Mutilation of Warrant. The Company
covenants that upon receipt by the Company of evidence reasonably satisfactory
to it of the loss, theft, destruction or mutilation of this Warrant or any stock
certificate relating to the Securities, and in case of loss, theft or
destruction, of indemnity or security reasonably satisfactory to it (which, in
the case of the Warrant, shall not include the posting of any bond), and upon
surrender and cancellation of such Warrant or stock certificate, if mutilated,
the Company will make and deliver a new Warrant or stock certificate of like
tenor and dated as of such cancellation, in lieu of such Warrant or stock
certificate.
d) 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, Sunday or a legal holiday, then such action may be
taken or such right may be exercised on the next succeeding day not a Saturday,
Sunday or legal holiday.
e) Authorized Shares.
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The Company covenants that during the period the Warrant is
outstanding, it will reserve from its authorized and unissued Common Stock
a sufficient number of shares to provide for the issuance of the shares of
Common Stock issuable upon conversion and exercise, as applicable, of the
Securities. The Company further covenants that its issuance of this Warrant
shall constitute full authority to its officers who are charged with the
duty of executing certificates to execute and issue the necessary
certificates for the Securities upon the exercise of the purchase rights
under this Warrant. The Company will take all such reasonable action as may
be necessary to assure that such Securities and Conversion Shares may be
issued as provided herein without violation of any applicable law or
regulation, or of any requirements of the Trading Market upon which the
Common Stock may be listed.
Except and to the extent as waived or consented to by the Holder,
the Company shall not by any action, including, without limitation,
amending its certificate of incorporation or through any reorganization,
transfer of assets, consolidation, merger, dissolution, issue or sale of
securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of this Warrant or the
Securities, but will at all times in good faith assist in the carrying out
of all such terms and in the taking of all such actions as may be necessary
or appropriate to protect the rights of Holder as set forth in this Warrant
and the Securities against impairment. Without limiting the generality of
the foregoing, the Company will (a) take all such action as may be
necessary or appropriate in order that the Company may validly and legally
issue fully paid and nonassessable Securities upon the exercise of this
Warrant and Conversion Shares upon conversion and exercise of the
Securities, and (b) use commercially reasonable efforts to obtain all such
authorizations, exemptions or consents from any public regulatory body
having jurisdiction thereof as may be necessary to enable the Company to
perform its obligations under this Warrant and the Securities.
Before taking any action which would result in an adjustment in the
Securities for which this Warrant is exercisable or in the Conversion
Price, the Company shall obtain all such authorizations or exemptions
thereof, or consents thereto, as may be necessary from any public
regulatory body or bodies having jurisdiction thereof.
f) Jurisdiction. All questions concerning the construction, validity,
enforcement and interpretation of this Warrant shall be determined in accordance
with the provisions of the Purchase Agreement.
g) Restrictions. The Holder acknowledges that the Securities acquired
upon the exercise of this Warrant, if not registered, will have restrictions
upon resale imposed by state and federal securities laws.
h) Nonwaiver and Expenses. No course of dealing or any delay or failure
to exercise any right hereunder on the part of Holder shall operate as a waiver
of such right
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or otherwise prejudice Xxxxxx's rights, powers or remedies, notwithstanding the
fact that all rights hereunder terminate on the Termination Date. If the Company
willfully and knowingly fails to comply with any provision of this Warrant,
which results in any material damages to the Holder, the Company shall pay to
Holder such amounts as shall be sufficient to cover any costs and expenses
including, but not limited to, reasonable attorneys' fees, including those of
appellate proceedings, incurred by Holder in collecting any amounts due pursuant
hereto or in otherwise enforcing any of its rights, powers or remedies
hereunder.
i) Notices. Any notice, request or other document required or permitted
to be given or delivered to the Holder by the Company shall be delivered in
accordance with the notice provisions of the Purchase Agreement.
j) Limitation of Liability. No provision hereof, in the absence of any
affirmative action by Holder to exercise this Warrant or purchase Securities,
and no enumeration herein of the rights or privileges of Holder, shall give rise
to any liability of Holder for the purchase price of any Common Stock or as a
stockholder of the Company, whether such liability is asserted by the Company or
by creditors of the Company.
k) Remedies. Holder, in addition to being entitled to exercise all
rights granted by law, including recovery of damages, will be entitled to
specific performance of its rights under this Warrant. The Company agrees that
monetary damages would not be adequate compensation for any loss incurred by
reason of a breach by it of the provisions of this Warrant and hereby agrees to
waive the defense in any action for specific performance that a remedy at law
would be adequate.
l) Successors and Assigns. Subject to applicable securities laws, this
Warrant and the rights and obligations evidenced hereby shall inure to the
benefit of and be binding upon the successors of the Company and the successors
and permitted assigns of Holder. The provisions of this Warrant are intended to
be for the benefit of all Holders from time to time of this Warrant and shall be
enforceable by any such Holder or holder of Securities.
m) Amendment. This Warrant may be modified or amended or the provisions
hereof waived with the written consent of the Company and the Holder.
n) Severability. Wherever possible, each provision of this Warrant
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Warrant shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provisions or the remaining provisions of this Warrant.
o) Headings. The headings used in this Warrant are for the convenience
of reference only and shall not, for any purpose, be deemed a part of this
Warrant.
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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by
its officer thereunto duly authorized.
Dated: June 8, 2005
WESTERN POWER & EQUIPMENT CORP., INC.
By:__________________________________
Name:
Title:
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NOTICE OF EXERCISE
TO: WESTERN POWER & EQUIPMENT CORP.
(1) The undersigned hereby elects to purchase $________ principal amount
of Debenture and Warrants to purchase _____ shares of Common Stock of Western
Power & Equipment Corp. pursuant to the terms of the attached Warrant and
tenders herewith payment of the Exercise Price in full, together with all
applicable transfer taxes, if any.
(2) Payment shall take the form of (check applicable box) in lawful money
of the United States; or
(3) Please issue a certificate or certificates representing said Securities
in the name of the undersigned or in such other name as is specified below:
________________________
The Securities shall be delivered to the following:
________________________
________________________
________________________
(4) Accredited Investor. 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: _________________________________________________
Date: __________________________________________________________________________
ASSIGNMENT FORM
(To assign the foregoing Warrant, execute
this form and supply required information.
Do not use this form to exercise the Warrant.)
FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby
are hereby assigned to
_______________________________________________ whose address is
_______________________________________________________________.
_______________________________________________________________
Dated: ______________, _______
Holder's Signature: _______________________________
Holder's Address: _______________________________
_______________________________
Signature Guaranteed: __________________________________________________________
NOTE: The signature to this Assignment Form must correspond with the name as it
appears on the face of the Warrant, without alteration or enlargement or any
change whatsoever, and must be guaranteed by a bank or trust company. Officers
of corporations and those acting in a fiduciary or other representative capacity
should file proper evidence of authority to assign the foregoing Warrant.
