WARRANT
Exhibit 10.2
WARRANT
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND MAY NOT BE SOLD, OFFERED
FOR SALE, ASSIGNED, TRANSFERRED OR OTHERWISE DISPOSED OF, UNLESS REGISTERED PURSUANT TO THE
PROVISIONS OF THE SECURITIES ACT OR AN OPINION OF COUNSEL IS OBTAINED STATING THAT SUCH DISPOSITION
IS IN COMPLIANCE WITH AN AVAILABLE EXEMPTION FROM SUCH REGISTRATION.
O2DIESEL CORPORATION
Warrant for the Purchase of Common Stock (Void after October___, 2009)
No. W-___
FOR VALUE RECEIVED, this Warrant is hereby issued by 02DIESEL CORPORATION, a Delaware corporation
(the “Company”), to UBS AG London Branch (the “Holder”). Subject to the provisions of this Warrant,
the Company hereby grants to Holder the right to purchase 2,666,666 shares of the Company’s common
stock, par value $.0001 per share (“Common Stock”), at $0.825 per share (“Exercise Price”) during
the period of six (6) months to forty two (42) months following the Closing (as defined in the
Common Stock and Warrant Purchase Agreement (the “Purchase Agreement”)).
The Holder agrees with the Company that this Warrant is issued, and all the rights hereunder shall
be held, subject to all of the conditions, limitations and provisions set forth herein.
1. Exercise
of Warrant. Subject to the terms and conditions set forth herein, the
Holder may exercise this Warrant on or after October___,
2006 and no later than October ___,
2009. To exercise this Warrant the Holder shall present and surrender this Warrant to the Company
at its principal office, with the Warrant Exercise Form, attached hereto as Appendix A,
duly executed by the Holder and accompanied by payment in cash or by check, payable to the
order of the Company, of the aggregate Exercise Price for the total aggregate number of securities
for which this Warrant is exercised. The Common Stock deliverable upon such exercise, and as
adjusted from time to time, are hereinafter referred to as “Warrant Stock.”
Upon receipt by the Company of this Warrant, together with the executed Warrant Exercise Form and
payment of the Exercise Price, if any, for the securities to be acquired, in proper form for
exercise, and subject to the Holder’s compliance with all requirements of this Warrant for the
exercise hereof, the Holder shall be deemed to be the holder of record of the Warrant Stock
issuable upon such exercise, notwithstanding that the stock transfer books of the Company shall
then be closed or that certificates representing such securities shall not then be actually
delivered to the Holder; provided, however, that no exercise of this Warrant shall be effective,
and the Company shall have no obligation to issue any Warrant Stock to the Holder
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upon any attempted exercise of this Warrant, unless the Holder shall have first delivered to the
Company, in form and substance reasonably satisfactory to the Company, appropriate representations
so as to provide the Company reasonable assurances that the securities issuable upon exercise may
be issued without violation of the registration requirements of the Securities Act and applicable
state securities laws, including without limitation representations that the exercising Holder is
an “accredited investor” as defined in Regulation D under the Securities Act and that the Holder is
familiar with the Company and its business and financial condition and has had an opportunity to
ask questions and receive documents relating thereto to his reasonable satisfaction.
2. Reservation of Shares. The Company will reserve for issuance and delivery upon
exercise of this Warrant all shares of Warrant Stock. All such shares shall be duly authorized
and, when issued upon such exercise, shall be validly issued, fully
paid and non-assessable and free
of all preemptive rights.
3. Assignment or Loss of Warrant. Subject to the transfer restrictions herein (including
Section 6), upon surrender of this Warrant to the Company or at the office of its stock transfer
agent, if any, with the Assignment Form, attached hereto as Appendix B, 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. Upon receipt by the Company of evidence reasonably satisfactory to it
of the loss, theft, destruction or mutilation of this Warrant, and of reasonably satisfactory
indemnification by the Holder, and upon surrender and cancellation of this Warrant, if mutilated,
the Company shall execute and deliver a replacement Warrant of like tenor and date.
4. Rights of the Holder. The Holder shall not, by virtue hereof, be entitled to any rights
of a stockholder in the Company, either at law or in equity, and the rights of the Holder are
limited to those expressed in this Warrant.
5. Adjustments.
(a) Adjustment for Recapitalization. If the Company shall at any time after the date hereof
subdivide its outstanding shares of Common Stock by recapitalization, reclassification or split-up
thereof, or if the Company shall declare a stock dividend or distribute shares of Common Stock to
its shareholders, the number of shares of Common Stock subject to this Warrant immediately prior to
such subdivision shall be proportionately increased, and if the Company shall at any time after the
date hereof combine the outstanding shares of Common Stock by recapitalization, reclassification or
combination thereof, the number of shares of Common Stock subject to this Warrant immediately prior
to such combination shall be proportionately decreased.
(b) Adjustment for Reorganization, Consolidation, Merger, Etc. If at any
time after the date hereof the Company has a Change in Control, the Holder agrees that, either (a)
Holder shall exercise its purchase right under this Warrant and such exercise will be deemed
effective immediately prior to the consummation of such Change in Control or (b) if the Holder
elects not to exercise the Warrant, this Warrant will expire upon the consummation of the
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Change of Control. For purposes of this Warrant, a “Change in
Control” shall be deemed to occur in the event of a change in
ownership or control of the Company effected through any of the
following transactions: (i) the acquisition, directly or indirectly,
by any person or related group of persons (other than the Company or a
person that immediately before the Change of Control directly or
indirectly controls, or is controlled by, or is under common control
with, the Company) of beneficial ownership (within the meaning of Rule
13d-3 of the Securities Exchange Act of 1934, as amended) of
outstanding securities possessing more than fifty percent (50%) of the
total combined voting power of the Company’s outstanding securities;
or (ii) the sale, transfer or other disposition of all or
substantially all of the Company’s assets; or (iii) the consummation
of a merger or consolidation of the Company with or into another
entity or any other corporate reorganization, if more than fifty
percent (50%) of the combined voting power of the continuing or
surviving entity’s securities outstanding immediately after such
merger, consolidation or other reorganization is owned by persons who
were not stockholders of the Company immediately prior to such merger,
consolidation or other reorganization.
(c) Certificate as to Adjustments. The adjustments provided in
this Section 5 shall be interpreted and applied by the Company in such
a fashion so as to reasonably preserve the applicability and benefits
of this Warrant (but not to increase or diminish the benefits
hereunder). In each case of an adjustment in the number of shares of
Common Stock receivable on the exercise of the Warrant, the Company at
its expense will promptly compute such adjustment in accordance with
the terms of the Warrant and prepare a certificate executed by two
executive officers of the Company setting forth such adjustment and
showing in detail the facts upon which such adjustment is based. The
Company will mail a copy of each such certificate to each Holder.
(d) Notices of Record Date, Etc. In the event that:
(i) the Company shall declare any dividend or other distribution
to the holders of Common Stock, or authorizes the granting to Common
Stock holders of any right to subscribe for, purchase or otherwise
acquire any shares of stock of any class or any other securities; or
(ii) the Company has a Change in Control; or
(iii) the Company authorizes any voluntary or involuntary
dissolution, liquidation or winding up of the Company,
then, and in each such case, the Company shall mail or cause to be
mailed to the holder of this Warrant at the time outstanding a notice
specifying, as the case may be, (a) the date on which a record is to be
taken for the purpose of such dividend, distribution or right, and
stating the amount and character of such dividend, distribution or
right, or (b) the date on which such reorganization, reclassification,
consolidation, merger, conveyance, dissolution, liquidation or winding
up is to take place, and the time, if any is to be fixed, as to which
the holders of record of Common Stock shall be entitled to exchange
their shares of Common Stock for securities or other property
deliverable upon such reorganization, reclassification, consolidation,
merger, conveyance, dissolution, liquidation or winding up. Such notice
shall be mailed at least 20 days prior to the date therein specified.
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(e) No Impairment. The Company will not, by any voluntary action,
avoid or seek to avoid the observance or performance of any of the
terms to be observed or performed hereunder by the Company, but will
at all times in good faith assist in the carrying out of all the
provisions of this Section 5 and in the taking of all such action as
may be necessary or appropriate in order to protect the rights of the
Holder of this Warrant against impairment.
6. Transfer to Comply with the Securities Act. This Warrant and
any Warrant Stock may not be sold, transferred, pledged, hypothecated
or otherwise disposed of except as follows: (a) to a person who, in the
opinion of counsel to the Company, is a person to whom this Warrant or
the Warrant Stock may legally be transferred without registration and
without the delivery of a current prospectus under the Securities Act
with respect thereto and then only against receipt of an agreement of
such person to comply with the provisions of this Section 6 with
respect to any resale or other disposition of such securities; or (b)
to any person upon delivery of a prospectus then meeting the
requirements of the Securities Act relating to such securities and the
offering thereof for such sale or disposition, and thereafter to all
successive assignees.
7. Legend. Unless the shares of Warrant Stock have been
registered under the Securities Act, upon exercise of this Warrant and
the issuance of any of the shares of Warrant Stock, all certificates
representing shares shall bear on the face thereof substantially the
following legend:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN
ACQUIRED BY THE HOLDER FOR ITS OWN ACCOUNT, FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO THE DISTRIBUTION OF SUCH
SECURITIES. THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY
APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE SOLD OR
OTHERWISE TRANSFERRED EXCEPT (I) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT AND COMPLIANCE WITH
SUCH STATE SECURITIES LAWS, (II) IN COMPLIANCE WITH RULE 144
UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS, OR (III)
UPON THE DELIVERY TO O2DIESEL CORPORATION (THE “COMPANY”) OF
AN OPINION OF COUNSEL OR OTHER EVIDENCE SATISFACTORY TO THE
COMPANY THAT SUCH REGISTRATION AND/ OR COMPLIANCE IS NOT
REQUIRED.
8. Notices. All notices required hereunder shall be in writing
and shall be deemed given when telegraphed, delivered personally or
within two days after mailing when mailed by certified or registered
mail, return receipt requested, to the Company or the Holder, as the
case may be, for whom such notice is intended, if to the Holder, at
the address of such party as set forth in the Purchase Agreement, or
if to the Company, O2Diesel Corporation, 000 Xxxxxxxx Xxxxx, Xxxxx
000, Xxxxxx, Xxxxxxxx 00000 or at such other address of which the
Company or the Holder has been advised by notice hereunder.
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9. Applicable Law. The Warrant is issued under and shall for
all purposes be governed by and construed in accordance with the laws
of the State of Delaware, without regard to the conflict of laws
provisions of such State.
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IN WITNESS WHEREOF, the Company has caused this Warrant to be
signed on its behalf, in its corporate name, by its duly authorized
officer, all as of the day and year first above written.
| O2Diesel Corporation | ||||||||
By:
|
By: | |||||||
| Chief Financial Officer | Chief Executive Officer | |||||||
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Appendix A
WARRANT EXERCISE FORM
The undersigned hereby irrevocably elects to exercise the within
Warrant to purchase
shares of the Common Stock of O2DIESEL
CORPORATION, a Delaware corporation, pursuant to the provisions of Section 1 of the attached Warrant, and hereby makes
payment of $ in payment therefor. The undersigned’s execution of this form
constitutes the undersigned’s agreement to all the terms of the Warrant and to
comply therewith.
| Signature | ||||||
| Print Name: |
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| Signature, if jointly held | ||||||
| Print Name: | ||||||
| Date: |
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