COMMON STOCK PURCHASE WARRANT OF ELEMENT 21 GOLF COMPANY
EXHIBIT
4.6
NEITHER
THIS WARRANT NOR THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THIS
WARRANT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND NEITHER
THIS
WARRANT NOR SUCH SHARES MAY BE SOLD, ENCUMBERED OR OTHERWISE TRANSFERRED EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT OR AN EXEMPTION
FROM SUCH REGISTRATION REQUIREMENT, AND, IF AN EXEMPTION SHALL BE APPLICABLE,
THE HOLDER SHALL HAVE DELIVERED AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY
THAT SUCH REGISTRATION IS NOT REQUIRED.
Void
after 5:00 P.M. Eastern Standard Time on the last day of the Termination Date,
as defined in the Warrant
| Warrant No. ASA-1 |
February
22,
2006
|
COMMON
STOCK PURCHASE WARRANT
OF
ELEMENT
21 GOLF COMPANY
This
is
to certify that, FOR VALUE RECEIVED, ASA Commerce, or
assigns (“Holder”), is entitled to purchase, subject to the provisions of this
Warrant, from Element 21 Golf Company, a Delaware corporation (the “Company”),
at an exercise price per share equal to $.01 per share, subject to adjustment
as
provided in this Warrant (such price as adjusted from time to time in accordance
herewith, the “Exercise Price”), ONE MILLION (1,000,000) shares of the Company’s
Common Stock, par value $0.01 per share (“Common Stock”). The shares of Common
Stock deliverable upon such exercise, and as adjusted from time to time, are
hereinafter sometimes referred to as “Warrant Shares”.
1. EXERCISE
OF WARRANT.
(a)
This
Warrant may be exercised in whole or in part at any time or from time to time
from and after the Initial Exercise Date and prior to the Termination Date
by
presentation and surrender hereof to the Company at its principal office, or
at
the office of its stock transfer agent, if any, with the Purchase Form annexed
hereto duly executed and accompanied by payment of the Exercise Price for the
number of shares of Common Stock specified in such form. 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 rights of the
Holder hereof to purchase the balance of the shares of Common Stock purchasable
hereunder. Upon receipt by the Company of this Warrant at its office, or by
the
stock transfer agent of the Company at its office, in proper form for exercise,
the Holder shall be deemed to be the holder of record of the shares of Common
Stock issuable upon such exercise, notwithstanding that the stock transfer
books
of the Company shall then be closed or that certificates representing such
shares of Common Stock shall not then be actually delivered to the Holder.
As
used herein, the term “Initial Exercise Date” shall mean the date upon which
this warrant was first issued by the Company to the Holder and the term
“Termination Date” shall mean the three year anniversary of the Initial Exercise
Date.
2. EXCHANGE,
TRANSFER, 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 or at the office of its stock
transfer agent, if any, for other Warrants of different denominations entitling
the holder thereof to purchase in the aggregate the same number of shares of
Common Stock purchasable hereunder. Subject to the provisions of Section 7
of
this Warrant, upon surrender of this Warrant to the Company or at the office
of
its stock transfer agent, if any, with the Assignment Form annexed hereto 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. 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 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. 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.
3. RIGHTS
OF THE HOLDER.
The
Holder shall not, by virtue of this Warrant, be entitled to any rights of a
stockholder 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.
4. ANTI-DILUTION
PROVISIONS.
From
and after the consummation of the Equity Financing, the Exercise Price and
the
number and kind of securities purchasable upon exercise of each Warrant shall
be
subject to adjustment as follows:
(a) In
case
the Company shall (1) pay a dividend or make a distribution on its shares of
Common Stock in shares of Common Stock or (2) subdivide or reclassify its
outstanding Common Stock into a greater number of shares, the Exercise Price
in
effect at the time of the record date for such dividend or distribution or
of
the effective date of such subdivision, combination or reclassification shall
be
proportionately adjusted so that the Holder of this Warrant exercised after
such
date shall be entitled to receive the aggregate number and kind of shares which,
if this Warrant had been exercised immediately prior to such time, he would
have
owned upon such exercise and been entitled to receive upon such dividend,
subdivision, combination or reclassification. Such adjustment shall be made
successively whenever any event listed in this Section 4(a) shall
occur.
2
(b) Whenever
the Exercise Price payable upon exercise of each Warrant is adjusted pursuant
to
Section 4(a) of this Warrant, the number of shares of Common Stock purchasable
upon exercise of each Warrant shall simultaneously be adjusted by multiplying
the number of shares of Common Stock issuable upon exercise of each Warrant
in
effect on the date thereof prior to giving effect to any adjustment by the
Exercise Price in effect on the date thereof prior to giving effect to any
adjustment and dividing the product so obtained by the Exercise Price, as
adjusted. In no event shall the Exercise Price per share be less than the par
value per share, and, if any adjustment made pursuant to Section 4(a) would
result in an exercise price of less than the par value per share, then, in
such
event, the Exercise Price per share shall be the par value per
share.
(c) All
calculations under this Section 4 shall be made to the nearest cent or to the
nearest one-hundredth of a share, as the case may be. Anything in this Section
4(c) to the contrary notwithstanding, the Company shall be entitled, but shall
not be required, to make such changes in the Exercise Price, in addition to
those required by this Section 4(c), as it in its discretion shall determine
to
be advisable in order that any dividend or distribution in shares of Common
Stock, subdivision, reclassification or combination of Common Stock, referred
to
hereinabove in this Section 4 hereafter made by the Company to the holders
of
its Common Stock shall not result in any tax to the holders of its Common Stock
or securities convertible into Common Stock.
(d) The
Company may retain a firm of independent public accountants of recognized
standing selected by the Board of Directors (who may be the regular accountants
employed by the Company) to make any computation required by this Section 4,
and
a certificate signed by such firm shall be conclusive evidence of the
correctness of such adjustment.
(e) In
the
event that at any time, as a result of an adjustment made pursuant to Section
4
of this Warrant, the Holder of any Warrant thereafter shall become entitled
to
receive any shares of the Company, other than Common Stock, thereafter the
number of such other shares so receivable upon exercise of any Warrant shall
be
subject to adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to the Common Stock
contained in Sections 4(a) to 4(d), inclusive, of this Warrant.
(f) Irrespective
of any adjustments in the Exercise Price or the number or kind of shares
purchasable upon exercise of Warrants, Warrants theretofore or thereafter issued
may continue to express the same price and number and kind of shares as are
stated in this and similar Warrants initially issued by the
Company.
5. OFFICER'S
CERTIFICATE.
Whenever the Exercise Price shall be adjusted as required by the provisions
of
Section 4 of this Warrant, the Company shall forthwith file in the custody
of
its Secretary or an Assistant Secretary at its principal office and with its
stock transfer agent, if any, an officer's certificate showing the adjusted
Exercise Price and the adjusted number of shares of Common Stock issuable upon
exercise of each Warrant, determined as herein provided, setting forth in
reasonable detail the facts requiring such adjustment, including a statement
of
the number of additional shares of Common Stock, if any, and such other facts
as
shall be necessary to show the reason for and the manner of computing such
adjustment. Each such officer's certificate shall be made available at all
reasonable times for inspection by the Holder or any holder of a
Warrant.
3
6. NOTICES
TO WARRANT HOLDERS.
So long
as this Warrant shall be outstanding, (1) if the Company shall pay any dividend
or make any distribution upon Common Stock (other than a regular cash dividend
payable out of retained earnings) or (2) if the Company shall offer to the
holders of Common Stock for subscription or purchase by them any share of any
class or any other rights or (3) if any capital reorganization of the Company,
reclassification of the capital stock of the Company, consolidation or merger
of
the Company with or into another corporation, sale, lease or transfer of all
or
substantially all of the property and assets of the Company to another
corporation, or voluntary or involuntary dissolution, liquidation or winding
up
of the Company shall be effected, then in any such case, the Company shall
cause
to be mailed by certified mail to the Holder, at least ten days prior to the
date specified in clauses (i) and (ii), as the case may be, of this Section
6 a
notice containing a brief description of the proposed action and stating the
date on which (i) a record is to be taken for the purpose of such dividend,
distribution or rights, or (ii) such reclassification, reorganization,
consolidation, merger, conveyance, lease, dissolution, liquidation or winding
up
is to take place and the date, if any is to be fixed, as of which the holders
of
Common Stock or other securities shall receive cash or other property
deliverable upon such reclassification, reorganization, consolidation, merger,
conveyance, dissolution, liquidation or winding up.
7. TRANSFER
TO COMPLY WITH THE SECURITIES ACT OF 1933.
This
Warrant or the Warrant Shares or any other security issued or issuable upon
exercise of this Warrant may not be sold or otherwise disposed of except as
follows:
(1) To
a
person who, in the opinion of counsel for the Company, is a person to whom
this
Warrant or Warrant Shares may legally be transferred without registration and
without the delivery of a current prospectus under the Act with respect thereto
and then only against receipt of an agreement of such person to comply with
the
provisions of this Section 8 with respect to any resale or other disposition
of
such securities which agreement shall be satisfactory in form and substance
to
the Company and its counsel; or
(2) to
any
person upon delivery of a prospectus then meeting the requirements of the Act
relating to such securities and the offering thereof for such sale or
disposition.
4
8. GOVERNING
LAW.
This
Warrant shall be governed by and construed in accordance with the laws of the
State of Delaware without giving effect to the principles of conflicts of law
thereof.
| Dated as of February 22, 2006 | ||
| ELEMENT 21 GOLF COMPANY | ||
| |
|
|
| By: | /s/ Xxxxxxxx Xxxxx | |
|
Name: Xxxxxxxx Xxxxx |
||
| Title: President | ||
5
PURCHASE
FORM
Dated:
__________ ,
20__
The
undersigned hereby irrevocably elects to exercise the within Warrant to the
extent of purchasing
shares
of Common Stock and hereby makes payment of $
in
payment of the actual exercise price thereof.
_________________
INSTRUCTIONS
FOR REGISTRATION OF STOCK
| Name | ||
|
|
(Please
typewrite or print in block
letters)
|
|
| Signature | ||
| Social Security or Employer Identification No. |
ASSIGNMENT
FORM
|
FOR
VALUE RECEIVED,
|
||
| hereby sells, assigns and transfer unto | ||
| Name | ||
|
|
(Please
typewrite or print in block
letters)
|
|
| Address | ||
| Social Security or Employer Identification No. |
The
right
to purchase Common Stock 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.
Dated:
___,
20___
Signature
_____________________
6
