Contract
EXHIBIT
10.40
THIS WARRANT AND THE COMMON SHARES ISSUABLE UPON EXERCISE OF THIS
WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
THIS WARRANT AND THE COMMON SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT MAY
NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT AS TO THIS WARRANT UNDER SAID ACT OR AN OPINION
OF COUNSEL REASONABLY SATISFACTORY TO SIONIX CORPORATION THAT SUCH REGISTRATION
IS NOT REQUIRED.
Right to
Purchase [ ] Shares of Common Stock of Sionix Corporation
(subject to adjustment as provided herein)
COMMON
STOCK PURCHASE WARRANT
No.
2009- Issue
Date: December __, 2009
SIONIX
CORPORATION, a corporation organized under the laws of the State of Nevada (the
"Company"), hereby
certifies that, for value received,
[ ],
or assigns (the “Holder”), is entitled, subject
to the terms set forth below, to purchase from the Company from and after the
Issue Date of this Warrant and at any time or from time to time before 5:00
p.m., New York time, through five (5) years after such date (the “Expiration Date”), up to
[ ]
fully paid and nonassessable shares of Common Stock, $0.001 par value, of the
Company, at the Exercise Price (as defined below). The number and character of
such shares of Common Stock and the Exercise Price are subject to adjustment as
provided herein.
As used
herein the following terms, unless the context otherwise requires, have the
following respective meanings:
(a) The
term “Company” shall include Sionix Corporation and any corporation which shall
succeed or assume the obligations of Sionix Corporation hereunder.
(b) The
term "Common Stock" includes (x) the Company's Common Stock, $0.001 par value
per share, and (y) any other securities into which or for which any of the
securities described in (x) may be converted or exchanged pursuant to a plan of
recapitalization, reorganization, merger, sale of assets or
otherwise.
(c) The
term "Other Securities" refers to any stock (other than Common Stock) and other
securities of the Company or any other person (corporate or otherwise) which the
holder of the Warrant at any time shall be entitled to receive, or shall have
received, on the exercise of the Warrant, in lieu of or in addition to Common
Stock, or which at any time shall be issuable or shall have been issued in
exchange for or in replacement of Common Stock or Other Securities pursuant to
Section 5 or otherwise.
(d) The term
"Exercise Price" shall be $0.25 per share, subject to adjustment pursuant to
Section 5.
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(e)
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The
term “Securities Purchase Agreement” shall be that certain Securities
Purchase Agreement by and between the Company and Holder entered into the
date hereof.
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1. Exercise of
Warrant.
1.1. Number of Shares Issuable
upon Exercise. From and after the Stockholder Approval Date as
defined in the Securities Purchase Agreement through and including the
Expiration Date, the Holder shall be entitled to receive, upon exercise of this
Warrant in whole or in part, shares of Common Stock of the Company, subject to
adjustment pursuant to Section 5, by delivery of an original or electronic copy
of the exercise notice attached hereto as Exhibit A (the “Exercise Notice”) along with
payment to the Company of the Exercise Price. Notwithstanding anything to the
contrary set forth herein, this Warrant shall not be exercisable prior to the
Stockholder Approval Date.
2. Procedure for
Exercise.
2.1 Delivery of Stock
Certificates, etc. on Exercise. The Company agrees that the shares of
Common Stock purchased upon exercise of this Warrant shall be deemed to be
issued to the Holder as the record owner of such shares as of the close of
business on the date on which both the Exercise Notice and payment have been
made for such shares. As soon as practicable after the exercise of this Warrant
in full or in part, and in any event within 3 business days thereafter, the
Company at its expense (including the payment by it of any applicable issue
taxes) will cause to be issued in the name of and delivered to the Holder, or as
such Holder (upon payment by such holder of any applicable transfer taxes) may
direct in compliance with applicable securities laws, a certificate or
certificates for the number of duly and validly issued, fully paid and
nonassessable shares of Common Stock (or Other Securities) to which such Holder
shall be entitled on such exercise.
2.2. Exercise.
Payment may be made either in cash or
by certified or official bank check payable to the order of the Company equal to
the applicable aggregate Exercise Price for the number of Common Shares
specified in the Exercise Notice (as such exercise number may be adjusted to
reflect any adjustment in the total number of shares of Common Stock issuable to
the Holder per the terms of this Warrant) and the Holder shall thereupon be
entitled to receive the number of duly authorized, validly issued, fully-paid
and non-assessable shares of Common Stock (or Other Securities) determined as
provided herein.
3. Cashless
Exercise.
After the Stockholder Approval Date and
the first anniversary of the Issue Date and if the resale of the Warrant Shares
have not been registered with the Securities and Exchange Commission and the
Fair Market Value of one share of Common Stock is greater than the Exercise
Price (at the date of calculation as set forth below), in lieu of exercising
this Warrant for cash, the Holder may elect to receive shares equal to the value
(as determined below) of this Warrant (or the portion thereof being cancelled)
by surrender of this Warrant at the principal office of the Company together
with the Exercise Notice, in which event the Company shall issue to the Holder a
number of shares of Common Stock computed using the following
formula:
X=Y (A-B)
A
Where X= the
number of shares of Common Stock to be issued to the Holder
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Y=
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the
number of shares of Common Stock purchasable under the Warrant or, if only
a portion of the Warrant is being exercised, the portion of the Warrant
being exercised (at the date of such
calculation)
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A=
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the
Fair Market Value of one share of the Company’s Common Stock (at the date
of such calculation)
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B=
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Exercise
Price (as adjusted to the date of such
calculation)
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4. Adjustment for Reorganization,
Consolidation, Merger, etc.
4.1. Reorganization,
Consolidation, Merger, etc. In case at any time or from time
to time, the Company shall (a) effect a reorganization, (b) consolidate with or
merge into any other person or entity, or (c) transfer all or substantially all
of its properties or assets to any other person or entity under any plan or
arrangement contemplating the dissolution of the Company, then, in each such
case, as a condition to the consummation of such a transaction, proper and
adequate provision shall be made by the Company whereby the Holder of this
Warrant, on the exercise hereof as provided in Section 1 at any time after the
consummation of such reorganization, consolidation or merger or the effective
date of such dissolution, as the case may be, shall receive, in lieu of the
Common Stock (or Other Securities) issuable on such exercise prior to such
consummation or such effective date, the stock and other securities and property
(including
cash) to
which such Holder would have been entitled upon such consummation or in
connection with such dissolution, as the case may be, if such Holder had so
exercised this Warrant, immediately prior thereto, all subject to further
adjustment thereafter as provided in Section 5.
4.2. Dissolution. In
the event of any dissolution of the Company following the transfer of all or
substantially all of its properties or assets, the Company, prior to such
dissolution, shall at its expense deliver or cause to be delivered the stock and
other securities and property (including cash, where applicable) receivable by
the Holder of the Warrant after the effective date of such dissolution pursuant
to Section 4.1 to a bank or trust company having its principal office in New
York, NY, as trustee for the Holder of the Warrant.
4.3. Continuation of
Terms. Upon any reorganization, consolidation, merger or
transfer (and any dissolution following any transfer) referred to in this
Section 4, this Warrant shall continue in full force and effect and the terms
hereof shall be applicable to the shares of stock and other securities and
property receivable on the exercise of this Warrant after the consummation of
such reorganization, consolidation or merger or the effective date of
dissolution following any such transfer, as the case may be, and shall be
binding upon the issuer of any such stock or other securities, including, in the
case of any such transfer, the person acquiring all or substantially all of the
properties or assets of the Company, whether or not such person shall have
expressly assumed the terms of this Warrant as provided in Section
4.1. In the event this Warrant does not continue in full force and
effect after the consummation of the transactions described in this Section 4,
then only in such event will the Company's securities and property (including
cash, where applicable) receivable by the holders of the Warrant be delivered to
the Trustee as contemplated by Section 4.2.
5. Adjustments for Stock Splits,
Combinations, etc. In the event that the Company shall (a)
issue additional shares of the Common Stock as a dividend or other distribution
on outstanding Common Stock, (b) subdivide its outstanding shares of Common
Stock, or (c) combine its outstanding shares of the Common Stock into a smaller
number of shares of the Common Stock, then, in each such event, the Exercise
Price shall, simultaneously with the happening of such event, be adjusted by
multiplying the then Exercise Price by a fraction, the numerator of which shall
be the number of shares of Common Stock outstanding immediately prior to such
event and the denominator of which shall be the number of shares of Common Stock
outstanding immediately after such event, and the product so obtained shall
thereafter be the Exercise Price then in effect. The Exercise Price, as so
adjusted, shall be readjusted in the same manner upon the happening of any
successive event or events described herein in this Section 5. The number of
shares of Common Stock that the holder of this Warrant shall thereafter, on the
exercise hereof as provided in Section 1, be entitled to receive shall be
adjusted to a number determined by multiplying the number of shares of Common
Stock that would otherwise (but for the provisions of this Section 5) be
issuable on such exercise by a fraction of which (a) the numerator is the
Exercise Price that would otherwise (but for the provisions of this Section 5)
be in effect, and (b) the denominator is the Exercise Price in effect on the
date of such exercise.
6. Certificate as to
Adjustments. In each case of any adjustment or readjustment in
the shares of Common Stock (or Other Securities) issuable on the exercise of the
Warrant, the Company at its expense will promptly cause its Chief Financial
Officer or other appropriate designee to compute such adjustment or readjustment
in accordance with the terms of the Warrant and prepare a certificate setting
forth such adjustment or readjustment and showing in detail the facts upon which
such adjustment or readjustment is based, including a statement of (a) the
consideration received or receivable by the Company for any additional shares of
Common Stock (or Other Securities) issued or sold or deemed to have been issued
or sold, (b) the number of shares of Common Stock (or Other Securities)
outstanding or deemed to be outstanding, and (c) the Exercise Price and the
number of shares of Common Stock to be received upon exercise of this Warrant,
in effect immediately prior to such adjustment or readjustment and as adjusted
or readjusted as provided in this Warrant. The Company will forthwith mail a
copy of each such certificate to the holder of the Warrant and any Warrant agent
of the Company (appointed pursuant to Section 12 hereof).
7. Reservation of Stock Issuable on
Exercise of Warrant. The Company will at all times after the
Stockholder Approval Date reserve and keep available, solely for issuance and
delivery on the exercise of the Warrant, shares of Common Stock (or Other
Securities) from time to time issuable on the exercise of the
Warrant.
8. Assignment; Exchange of
Warrant. Subject to compliance with applicable securities
laws, this Warrant, and the rights evidenced hereby, may be transferred by any
registered holder hereof (a "Transferor")
with
respect
to any or all of the shares underlying this Warrant. On the surrender for
exchange of this Warrant, with the Transferor's endorsement in the form of
Exhibit B attached hereto (the “Transferor Endorsement Form")
and together with evidence reasonably satisfactory to the Company demonstrating
compliance with applicable securities laws, which shall include, without
limitation, a legal opinion from the Transferor’s counsel that such transfer is
exempt from the registration requirements of applicable securities laws, the
Company at its expense but with payment by the Transferor of any applicable
transfer taxes will issue and deliver to or on the order of the Transferor
thereof a new Warrant of like tenor, in the name of the Transferor and/or the
transferee(s) specified in such Transferor Endorsement Form (each a "Transferee"), calling in the
aggregate on the face or faces thereof for the number of shares of Common Stock
called for on the face or faces of the Warrant so surrendered by the
Transferor.
9. Replacement of
Warrant. On receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant and, in
the case of any such loss, theft or destruction of this Warrant, on delivery of
an indemnity agreement or security reasonably satisfactory in form and amount to
the Company or, in the case of any such mutilation, on surrender and
cancellation of this Warrant, the Company at its expense will execute and
deliver, in lieu thereof, a new Warrant of like tenor.
10. Maximum
Exercise. The Holder shall not be entitled to exercise
this Warrant on an exercise date, in connection with that number of shares of
Common Stock which would be in excess of the sum of (i) the number of shares of
Common Stock beneficially owned by the Holder and its affiliates on an exercise
date, and (ii) the number of shares of Common Stock issuable upon the exercise
of this Warrant with respect to which the determination of this proviso is being
made on an exercise date, which would result in beneficial ownership by the
Holder and its affiliates of more than 4.99% of the outstanding shares of Common
Stock of the Company on such date. For the purposes of the proviso to
the immediately preceding sentence, beneficial ownership shall be determined in
accordance with Section 13(d) of the Securities Exchange Act of 1934, as
amended, and Regulation 13d-3 thereunder. Subject to the foregoing,
the Holder shall not be limited to aggregate exercises which would result in the
issuance of more than 4.99%.
11. Warrant Agent. The
Company may, by written notice to each holder of the Warrant, appoint an agent
for the purpose of issuing Common Stock (or Other Securities) on the exercise of
this Warrant pursuant to Section 1, exchanging this Warrant pursuant to Section
8, and replacing this Warrant pursuant to Section 9, or any of the foregoing,
and thereafter any such issuance, exchange or replacement, as the case may be,
shall be made at such office by such agent.
12. Transfer on the Company's
Books. Until this Warrant is transferred on the books of the
Company, the Company may treat the registered holder hereof as the absolute
owner hereof for all purposes, notwithstanding any notice to the
contrary.
13. Voluntary Adjustment by the
Company. The Company may at any time during the term of this
Warrant reduce the then current Exercise Price to any amount and for any period
of time deemed appropriate by the Board of Directors of the
Company.
14. Miscellaneous. This
Warrant and any term hereof may be changed, waived, discharged or terminated
only by an instrument in writing signed by the party against which enforcement
of such change, waiver, discharge or termination is sought. This Warrant shall
be governed by and construed in accordance with the laws of State of California
without regard to principles of conflicts of laws. Any action brought
concerning the transactions contemplated by this Warrant shall be brought only
in the state or federal courts located in the City of Los Angeles,
California. The individuals executing this Warrant on behalf of the
Company agree to submit to the jurisdiction of such courts and waive trial by
jury. The prevailing party shall be entitled to recover from the
other party its reasonable attorney’s fees and costs. In the event
that any provision of this Warrant is invalid or unenforceable under any
applicable statute or rule of law, then such provision shall be deemed
inoperative to the extent that it may conflict therewith and shall be deemed
modified to conform with such statute or rule of law. Any such
provision which may prove invalid or unenforceable under any law shall not
affect the validity or enforceability of any other provision of this Warrant.
The headings in this Warrant are for purposes of reference only, and shall not
limit or otherwise affect any of the terms hereof. The invalidity or
unenforceability of any provision hereof shall in no way affect the validity or
enforceability of any other provision. Each party acknowledges either
that its legal counsel participated in the preparation of this Warrant or that
it had sufficient
opportunity
to have legal counsel participate in the preparation of this Warrant and,
therefore, stipulates that the rule of construction that ambiguities are to be
resolved against the drafting party shall not be applied in the interpretation
of this Warrant to favor any party against the other party.
[THIS
SPACE INTENTIONALLY LEFT BLANK]
IN
WITNESS WHEREOF, the Company has executed this Warrant under seal as of the date
first written above.
SIONIX
CORPORATION
By:_____________________________________
Xxxxxx Xxxxxxxx, Chief Executive
Officer
Exhibit
A
EXERCISE
NOTICE
(To be
signed only on exercise of Warrant)
TO: Sionix
Corporation
The
undersigned, pursuant to the provisions set forth in the attached Warrant
(No.____), hereby irrevocably elects to purchase:
________ shares
of the Common Stock covered by such Warrant. The undersigned herewith
makes payment of the full Exercise Price for such shares at the price per share
provided for in such Warrant, which is an aggregate of $___________;
or
________ the
maximum number of shares of Common Stock covered by such Warrant pursuant to the
cashless exercise procedure set forth in Section 3.
The
undersigned requests that the certificates for such shares be issued in the name
of, and delivered to ________________________ whose address
is ______________________________________
____________________________________ .
The
undersigned represents and warrants that all offers and sales by the undersigned
of the securities issuable upon exercise of the within Warrant shall be made
pursuant to registration of the Common Stock under the Securities Act of 1933,
as amended (the "Securities Act") or pursuant to an exemption from registration
under the Securities Act.
Dated:___________________ _______________________________________
(Signature
must conform to name of holder as specified on the face of the
Warrant)
_____________________________________
(Address)
Exhibit
B
FORM
OF TRANSFEROR ENDORSEMENT
(To be
signed only on transfer of Warrant)
For value
received, the undersigned hereby sells, assigns, and transfers unto the
person(s) named below under the heading "Transferees" the right represented by
the within Warrant to purchase the percentage and number of shares of Common
Stock of Sionix Corportion to which the within Warrant relates specified under
the headings "Percentage of Warrant Transferred" and "Number Transferred,"
respectively, opposite the name(s) of such person(s) and appoints each such
person Attorney to transfer its respective right on the books of Sionix
Corporation with full power of substitution in the premises.
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Transferees
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Percentage
of Warrant
Transferred
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Number
Transferred
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Dated: ,
__ ___________________________________________
(Signature
must conform to name of holder as specified on the face of the
warrant)
Signed in
the presence of:
_______________________________ ____________________________________________
(Name) (address)
____________________________________________
ACCEPTED
AND
AGREED: (address)
[TRANSFEREE]
_________________________________
(Name)
