EXHIBIT 6
THIS WARRANT IS ISSUED IN EXCHANGE FOR THE REVISED XXXXXXX WARRANT (THE "MICROGY
WARRANT") TO PURCHASE 800,000 SHARES OF COMMON STOCK OF MICROGY COGENERATION
SYSTEMS, INC. ("MICROGY"), PREVIOUSLY ISSUED BY MICROGY, WHICH MICROGY WARRANT
IS OF NO FURTHER FORCE AND EFFECT.
THIS WARRANT AND THE COMMON STOCK AND SERIES B CONVERTIBLE PREFERRED STOCK
RECEIVABLE UPON THE EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 ("THE ACT"), OR ANY STATE SECURITIES LAWS. THEY MAY NOT
BE TRANSFERRED OR OFFERED FOR SALE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT OR AN OPINION OF COUNSEL, REASONABLY SATISFACTORY TO THE
COMPANY, TO THE EFFECT THAT REGISTRATION IS NOT REQUIRED.
VOID AFTER 5:00 P.M., EASTERN TIME, ON SEPTEMBER 30, 2002
WARRANT TO PURCHASE COMMON STOCK AND SERIES B CONVERTIBLE PREFERRED STOCK
ENVIRONMENTAL POWER CORPORATION
ORIGINAL ISSUE DATE: JULY 23, 2001
This is to Certify That, FOR VALUE RECEIVED, Xxxxxx X. Xxxxxxx ("Holder")
is entitled to purchase, subject to the provisions of this Warrant, from
ENVIRONMENTAL POWER CORPORATION (the "Company"), at any time until 5:00 P.M.,
Eastern Time, on September 30, 2002 ("Expiration Date"), 800,000 units
("Units"), each Unit consisting of 0.3468495 shares (the "Common Exercise Rate")
of the Company's Common Stock ("Common Shares") and 0.0124228 shares (the
"Preferred Exercise Rate") of the Company's Series B Convertible Preferred Stock
("Preferred Shares," and, together with Common Shares, "Shares"). The exercise
price ("Exercise Price") of the Warrant shall be $.50 per Unit through May 31,
2002, and $1.00 per Unit from June 1, 2002 through the Expiration Date. If,
prior to the complete exercise of this Warrant, the Company's Series B
Convertible Preferred Stock is automatically converted (the "Conversion") into
Common Shares pursuant to Section 5(a) of the Company's related Certificate of
Designations (the "Certificate of Designations") each Unit thereafter issued
upon the exercise of this Warrant will include, in lieu of the 0.124228
Preferred Shares referred to above, the Common Shares such Preferred Shares
would have been converted into if such Preferred Shares were outstanding
immediately prior to the Conversion (assuming for this purpose that fractional
shares of Common Stock were issuable upon exercise of the Preferred Shares).
Such number of additional Common Shares on a per Unit basis are referred to as
-1-
the "Additional Common Exercise Rate." The number of Shares to be received upon
the exercise of this Warrant may be adjusted from time to time as hereinafter
set forth.
(a) EXERCISE OF WARRANT. This Warrant may be exercised in whole or in part
-------------------
at any time or from time to time until the Expiration Date or if the Expiration
Date is a day on which banking institutions are authorized by law to close, then
on the next succeeding day which shall not be such a day, by presentation and
surrender hereof to the Company or at the office its stock transfer agent, if
any, with the Purchase Form annexed hereto as Exhibit A duly executed and
accompanied by payment of the Exercise Price for the number of Shares specified
in such Form, together with all federal and state taxes applicable upon such
exercise, in cash or by certified or official bank check payable to the order of
the Company.
The Company agrees not to merge, reorganize or take any action that would
terminate this Warrant unless provisions are made as part of such merger,
reorganization or other action which would provide the holders of this Warrant
with an equivalent of this Warrant as specified in Section (f)(3) hereof. 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 right of the Holder to purchase the balance of the Shares purchasable
hereunder. Upon receipt by the Company of this Warrant at the office of the
Company, in proper form for exercise and accompanied by the Exercise Price, the
Holder shall be deemed to be the holder of record of the Shares issuable upon
such exercise, notwithstanding that the stock transfer books of the Company
shall then be closed or that certificates representing such Shares shall not
then be actually delivered to the Holder.
(b) RESERVATION OF SHARES. The Company hereby agrees that at all times
---------------------
there shall be reserved for issuance and/or delivery upon exercise of this
Warrant such number of Shares as shall be required for issuance or delivery upon
exercise of this Warrant.
(c) LIMIT ON FRACTIONAL SHARES. No fractional Common Shares, shares or
--------------------------
scrip representing fractional shares shall be issued upon the exercise of this
Warrant. Fractional Preferred Shares may only be issued in tenths. The number
of Shares issuable upon exercise of this Warrant involving an aggregate Exercise
Price of less than $25,000 shall be rounded to the next lowest whole Common
Share and the next lowest tenth of a Preferred Share and the number of Shares
issuable upon exercise of this Warrant involving an aggregate exercise price of
$25,000 or more shall be rounded to the nearest Common Share and the nearest
tenth of a Preferred Share.
(d) EXCHANGE, 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 for other Warrants of different denominations entitling
the Holder thereof to purchase (under the same terms and conditions as provided
by this Warrant) in the aggregate the same number of Shares purchasable
hereunder. Subject to Sections (i) and (1), any transfer or assignment shall be
made by surrender of this Warrant to the Company with the Assignment Form
annexed hereto as Exhibit B duly executed and with funds sufficient to pay any
transfer tax; whereupon 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
-2-
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 issued in substitution for or replacement of this Warrant,
or 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 and date. Subject to such right of indemnification, 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.
(e) RIGHTS OF THE HOLDER. The Holder shall not, by virtue hereof, be
--------------------
entitled to any rights of a shareholder 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.
(f) ADJUSTMENT PROVISIONS. The Common Exercise Rate and the Additional
---------------------
Common Exercise Rate shall be subject to adjustment from time to time as
follows:
1. If, at any time after the Original Issue Date (in the case of the
Common Exercise Rate) or the date of the Conversion (in the case of the
Additional Common Exercise Rate), the number of shares of Common Stock
outstanding is increased by a stock dividend payable in shares of Common Stock
or by a subdivision or split-up of shares of Common Stock, then, following the
record date for the determination of holders of Common Stock entitled to receive
such stock dividend, subdivision or split-up, the Common Exercise Rate (and the
Additional Common Exercise Rate, if applicable) shall be appropriately increased
so that the number of shares of Common Stock issuable on exercise of the
Warrants shall be increased in proportion to such increase in outstanding
shares.
2. If, at any time after the Original Issue Date (in the case of the
Common Exercise Rate) or the Conversion Date (in the case of the Additional
Common Exercise Rate), the number of shares of Common Stock outstanding is
decreased by a combination of the outstanding shares of Common Stock, then,
following the record date for such combination, the Common Exercise Rate (and
the Additional Common Exercise Rate, if applicable) shall be appropriately
decreased so that the number of shares of Common Stock issuable on exercise of
the Warrants shall be decreased in proportion to such decrease in outstanding
shares.
3. In the event of any capital reorganization of the Company, any
reclassification of the stock of the Company (other than a change in par value
or from no par value to par value or from par value to no par value or as a
result of a stock dividend or subdivision, split-up or combination of shares),
any consolidation or merger of the Company, or any sale, lease, conveyance to
another person of the property of the Company pursuant to which the Company's
Common Stock and/or Series B Convertible Preferred Stock is converted into other
-3-
securities, cash or assets, each Warrant shall after such reorganization,
reclassification, consolidation, merger or conveyance be exercisable into the
kind and number of shares of stock or other securities or property of the
Company or of the Company resulting from such consolidation or surviving such
merger to which the holder of the number of shares of Common Stock (and/or
Series B Convertible Preferred Stock, if applicable) deliverable (immediately
prior to the time of such reorganization, reclassification, consolidation or
merger) upon exercise of such Warrant would have been entitled upon such
reorganization, reclassification, consolidation, merger or conveyance. The
provisions of this clause shall similarly apply to successive reorganizations,
reclassifications, consolidations, mergers or conveyances.
4. The provisions of this Section (f) shall be interpreted so as not
to duplicate the effect of adjustments made to the conversion rate of the
Preferred Shares into Common Stock under the Certificate of Designations. In the
event an event comparable to those described in Sections f(1) or (2) occurs with
respect to the Preferred Shares themselves, appropriate adjustment will be made
in the Preferred Exercise Rate, preceding sentence of this Section (f)(4).
(g) STATEMENT OF ADJUSTMENT. Whenever a Conversion Rate shall be
-----------------------
adjusted as provided in paragraph (f), the Company shall make available for
inspection by the Holder during regular business hours, at its principal
executive offices or at such other place as may be designated by the Company, a
statement, signed by its chief executive officer or president, showing in detail
the facts requiring such adjustment and the Conversion Rate that shall be in
effect after such adjustment. The Company shall also cause a copy of such
statement to be sent by first class certified mail, return receipt requested and
postage prepaid, to Holder at such Holder's address appearing on the Company's
records.
(h) NOTICES. Unless otherwise provided herein, any notice, request,
-------
instruction or other document to be given hereunder by any party shall be in
writing and delivered in person or by courier or by facsimile transmission
(followed by mailing certified mail, postage prepaid, return receipt requested)
or mailed by certified mail, postage prepaid, return receipt requested, as
follows: (1) to the Holder at the Holder's address as it appears in the records
of the Company or at such other address as the Holder may otherwise indicate in
a written notice delivered to the Company or (2) to the Company, at 000 Xxxxxx
Xxxxxx, Xxxxx 0X, Xxxxxxxxxx, Xxx Xxxxxxxxx 00000, Telephone: (000) 000-0000,
Facsimile: (000) 000-0000, or at such other address as the Company may otherwise
indicate in a written notice delivered to Holder. All such notices, requests,
instructions, documents and other communications will (2) if delivered
personally to the address as provided in this Section (h), be deemed given upon
delivery, (2), if delivered by facsimile transmission to the facsimile number as
provided in this Section (h), be deemed given upon receipt, and (3) if delivered
by mail in the manner described above to the address as provided in this Section
(h), be deemed given upon receipt (in each case regardless of whether such
notice is received by any other Person to whom a copy of such communication is
to be delivered pursuant to this Section (h).
(i) TRANSFER TO COMPLY WITH THE SECURITIES ACT OF 1933. The Company
--------------------------------------------------
may cause the following legend, or one similar thereto, to be set forth on each
certificate representing the Shares or any other security issued or issuable
upon exercise of this Warrant or conversion of underlying Preferred Shares not
theretofore distributed to the public or sold to underwriters for
-4-
distribution to the public pursuant to Section (i) hereof; unless legal counsel
for the Company is of the opinion as to any such certificate that such legend,
or one similar thereto, is unnecessary:
The securities represented by this certificate may not be offered for sale,
sold or otherwise transferred except pursuant to an effective registration
statement made under the Securities Act of 1933 (the "Act") and under any
applicable state securities law, or pursuant to an exemption from
registration under the Act and under any applicable state securities law,
the availability of which is to be established to the satisfaction of the
Company.
The Holder(s) agree that this Warrant and all Shares acquired upon
exercise hereof or conversion of underlying Preferred Shares will be disposed of
only in accordance with the Act and the rules and regulations of the Securities
and Exchange Commission promulgated thereunder.
(j) EXEMPTION FROM REGISTRATION FOR WARRANT EXERCISE.
-----------------------------------------------
The Company and the Holder acknowledge that the Company will be
relying on an exemption from the registration requirements of the Securities Act
of 1933, as amended (the "Act"), to deliver Shares to the Holder(s) upon the
exercise of the Warrant or upon conversion of underlying Preferred Shares. The
Holder agrees to provide the Company with such information and representations
as may be requested by the Company in order to establish a claim to an exemption
from the registration requirements of the Act, and any applicable state
securities laws, including, a representation that the Holder(s) are taking the
Shares for investment, and not with a view to distribution.
(k) APPLICABLE LAW. This Warrant shall be governed by, and construed
--------------
in accordance with, the laws of the state of New York.
(l) TRANSFER AND ASSIGNMENT. This Warrant may not be transferred or
-----------------------
assigned, in whole or in part without the written consent of the Company.
Neither this Warrant nor any Shares issued upon the exercise hereof or upon
conversion of underlying Preferred Shares shall be transferred other than
pursuant to an effective registration statement under the Securities Act or an
exemption from the registration provisions thereof. Each certificate, if any,
evidencing such shares of restricted stock issued upon any such transfer other
than in a public offering pursuant to an effective registration statement shall
bear the restrictive legend set forth in Section (i), and each Warrant issued
upon such assignment or transfer shall bear the restrictive legend set forth in
this Warrant, unless in the opinion of counsel delivered at the request of the
Holder, which opinion shall be reasonably acceptable to the Company, such legend
is not required for the purposes of compliance with the Act.
(m) SUCCESSORS AND ASSIGNS. The rights evidenced hereby shall inure to
----------------------
the benefit of and be binding upon the successors of the Company and the
successors and assigns of the Holder hereof. 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.
-5-
(n) AMENDMENT. This Warrant and all other Warrants may not be modified
---------
or amended or the provisions hereof waived except by the written consent of
the Company and the Holder(s).
ENVIRONMENTAL POWER CORPORATION
By: ________________________________________
Name:
Title:
Agreed and Accepted:
__________________________
Xxxxxx X. Xxxxxxx
-6-
EXHIBIT A
PURCHASE FORM
-------------
DATED: __________________________, 200_
The undersigned hereby irrevocably elects to exercise the Warrant to the
extent of purchasing ______________ Common Shares [and _______ Preferred Shares]
of Environmental Power Corporation, and hereby makes payment of $_____________
in payment of the actual Exercise Price thereof.
INSTRUCTIONS FOR REGISTRATION OF SHARES
---------------------------------------
Name: ________________________________________________________________________
(Please typewrite or print in block letters)
Address: ____________________________________________________________________
Signature: __________________________________________________________________
-7-
EXHIBIT B
ASSIGNMENT FORM
---------------
Dated: __________________________, 200__
FOR VALUE RECEIVED, _____________________________________________
hereby sells, assigns and transfers unto
Name: ____________________________________________________________________
(Please typewrite or print in block letters)
Address: __________________________________________________________________
the right to purchase Shares represented by this Warrant to the extent of
_________________________ Shares as to which such right is exercisable and does
hereby irrevocably constitute and appoint __________________, attorney, to
transfer the same on the books of the Company with full power of substitution in
the premises.
Signature: _____________________________________
-8-
