NEED AN EXHIBIT NUMBER!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
NEITHER THIS WARRANT NOR ANY SHARES OF COMMON STOCK OR OTHER
SECURITIES ISSUED ON THE THE EXERCISE HEREOF, HAS BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). THE
NOTE HAS BEEN (AND ANY SHARES OF COMMON STOCK OR OTHER SECURITIES
ISSUED UPON CONVERSION THEREOF WILL BE) ACQUIRED FOR INVESTMENT
AND MUST BE HELD INDEFINITELY UNLESS SUBSEQUENTLY REGISTERED
UNDER THE ACT OR IN THE OPINION OF COUNSEL TO THE COMPANY, AN
EXEMPTION FROM REGISTRATION UNDER THE ACT IS AVAILABLE.
THIS WARRANT SHALL BE VOID AFTER 5:00 P.M. EASTERN TIME ON APRIL 1, 2012
(THE "EXPIRATION DATE").
PW No. __
TURBODYNE TECHNOLOGIES INC
WARRANT TO PURCHASE
SHARES OF COMMON STOCK
FOR VALUE RECEIVED, Stamford Research LLC, a New Mexico limited
liability company ("HOLDER"), is entitled to purchase, subject to the provisions
of this Warrant, from Turbodyne Technologies Inc., a Nevada corporation
("COMPANY"), 6,400,000 shares ("WARRANT SHARES") of the Company's common stock,
("COMMON STOCK"). The Holder may purchase the Warrant Shares at any time after
the Trigger Event as hereinafter defined but not later than 5:00 P.M., Eastern
time, on the Expiration Date (as defined above), at an exercise price per share
initially equal to $0.0117. The exercise price in effect shall hereinafter be
referred to as the "WARRANT PRICE. The number of Warrant Shares purchasable upon
exercise of this Warrant and the Warrant Price shall be subject to adjustment
from time to time as described herein. All references in this Warrant to dollar
amounts shall be to United States dollars.
SECTION 1.Certain Definitions. The following terms shall have the meanings set
forth below:
"Service Arrangements" shall mean the Consulting Agreement dated as of _____ __,
2006, between the Company and Holder or substitute Employment Agreement between
the Company and Designated Consulting Executive entered into pursuant to such
Consulting Agreement.
"Triggering Event" shall refer to the date of filing of a report with the
Securities & Exchange Commission containing reviewed or audited statements
reflecting EBITA or earnings before taxes, interest or amortization of
$1,000,000 and provided such filing occurs during the period that a Service
Arrangement is in effect..
SECTION 2. TRANSFERS. As provided herein, this Warrant may be transferred only
pursuant to a registration statement filed under the Securities Act of 1933, as
amended ("SECURITIES ACT"), or an exemption from such registration. Subject to
such restrictions, the Company shall transfer this Warrant from time to time
upon the books to be maintained by the Company for that purpose, upon surrender
thereof for transfer properly endorsed or accompanied by appropriate
instructions for transfer and such other documents as may be reasonably required
by the Company, including, if required by the Company, an opinion of its counsel
to the effect that such transfer is exempt from the registration requirements of
the Securities Act, to establish that such transfer is being made in accordance
with the terms hereof, and a new Warrant shall be issued to the transferee and
the surrendered Warrant shall be canceled by the Company.
SECTION 3. EXERCISE OF WARRANT.
(a) Subject to the provisions hereof, Warrant holder may
exercise this Warrant in whole or in part (in minimum amounts of 10,000
Warrants, or if less, the remaining unexercised Warrants) at any time prior to
its expiration. upon surrender of the Warrant, together with delivery of the
duly executed Warrant Exercise Form attached hereto as APPENDIX A with , payment
by cash, certified check or wire transfer of funds for the aggregate Warrant
Price for that number of Warrant Shares then being purchased, to the Company
during normal business hours on any business day at the Company's principal
executive offices (or such other office or agency of the Company as it may
designate by notice to the holder hereof).
(b) The Warrant Shares so purchased shall be deemed to be
issued to the holder hereof or such holder's designee, as the record owner of
such shares, as of the close of business on the date on which this Warrant shall
have been surrendered or delivered (or evidence of loss, theft or destruction
thereof and security or indemnity satisfactory to the Company)and (i) the
Warrant Price shall have been paid and the completed Warrant Exercise Form shall
have been delivered. Certificates for the Warrant Shares so purchased,
representing the aggregate number of shares specified in the Warrant Exercise
Form , shall be delivered to the holder hereof within a reasonable time, not
exceeding five business days, after this Warrant shall have been so exercised.
The certificates so delivered shall be in such denominations as may be requested
by the holder hereof and shall be registered in the name of such holder or such
other name as shall be designated by such holder. If this Warrant shall have
been exercised only in part, then, unless this Warrant has expired, the Company
shall, at its expense, at the time of delivery of such certificates, deliver to
the holder a new Warrant representing the number of shares with respect to which
this Warrant shall not then have been exercised. As used in this Agreement,
"business day" means a day, other than a Saturday or Sunday, on which banks in
New York City are open for the general transaction of business.
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SECTION 4. Legend in COMPLIANCE WITH THE SECURITIES ACT. The Company may cause
the legend set forth on the first page of this Warrant to be set forth on each
Warrant or similar legend on any security issued or issuable upon exercise of
this Warrant, unless counsel for the Company is of the opinion as to any such
security that such legend is unnecessary.
SECTION 5. PAYMENT OF TAXES. The Company will pay any documentary stamp taxes
attributable to the initial issuance of Warrant Shares issuable upon the
exercise of the Warrant; provided, however, that the Company shall not be
required to pay any tax or taxes which may be payable in respect of any transfer
involved in the issuance or delivery of any certificates for Warrant Shares in a
name other than that of the registered holder of this Warrant in respect of
which such shares are issued, and in such case, the Company shall not be
required to issue or deliver any certificate for Warrant Shares or any Warrant
until the person requesting the same has paid to the Company the amount of such
tax or has established to the Company's reasonable satisfaction that such tax
has been paid. The holder shall be responsible for income taxes due under
federal, state or other law, if any such tax is due.
SECTION 6. MUTILATED OR MISSING WARRANTS. In case this Warrant shall be
mutilated, lost, stolen, or destroyed, the Company shall issue in exchange and
substitution of and upon cancellation of the mutilated Warrant, or in lieu of
and substitution for the Warrant lost, stolen or destroyed, a new Warrant of
like tenor and for the purchase of a like number of Warrant Shares, but only
upon receipt of evidence reasonably satisfactory to the Company of such loss,
theft or destruction of the Warrant, and with respect to a lost, stolen or
destroyed Warrant, reasonable indemnity or bond with respect thereto, if
requested by the Company.
SECTION 7. RESERVATION OF COMMON STOCK. The Company hereby represents and
warrants that there have been reserved, and the Company shall at all applicable
times keep reserved until issued (if necessary) as contemplated by this SECTION
7, out of the authorized and unissued shares of Common Stock, sufficient shares
to provide for the exercise of the rights of purchase represented by this
Warrant. The Company agrees that all Warrant Shares issued upon due exercise of
the Warrant shall be, at the time of delivery of the certificates for such
Warrant Shares, duly authorized, validly issued, fully paid and non-assessable
shares of Common Stock of the Company.
SECTION 8. ADJUSTMENTS UPON STOCK EVENTS AND STOCK ISSUANCES. Subject and
pursuant to the provisions of this SECTION 8, the Warrant Price and number of
Warrant Shares subject to this Warrant shall be subject to adjustment from time
to time as set forth hereinafter.
(a). If outstanding shares of the common stock shall be
subdivided into a greater number of shares or a dividend in common stock shall
be paid in respect of common stock, the Fixed Conversion Price in effect
immediately prior to such subdivision or dividend shall simultaneously with the
effectiveness of such subdivision or dividend be proportionately reduced. If
outstanding shares of common stock shall be combined into a smaller number of
shares, the Exercise Price in effect immediately prior to such combination
shall, simultaneously with the effectiveness of such combination, be
proportionately increased. In each case the number of Warrant Shares shall be
similarly increased or decreased as the case may be.
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..
(b) In case there occurs any reclassification or change of the
outstanding securities of which are at the time receivable in conjunction with
the Security Agreement or any corporate reorganization on or after the date
hereof, then and in each such case the Holder, upon the exercise hereof at any
time after the consummation of such reclassification, change or reorganization,
shall be entitled to receive, in lieu of common stock, the stock or other
securities or property to which such Holder would have been entitled upon such
consummation if such Holder had converted this Note immediately prior thereto,
all subject to further adjustment pursuant to the provisions of this Sections 8.
SECTION 9. FRACTIONAL INTEREST. The Company shall not be required to issue
fractions of Warrant Shares upon the exercise of this Warrant. If any fractional
share of Common Stock would, except for the provisions of the first sentence of
this SECTION 9, be deliverable upon such exercise, the Company, in lieu of
delivering such fractional share, shall pay to the exercising holder of this
Warrant an amount in cash equal to the Market Value of such fractional share of
Common Stock on the date of exercise. For purposes hereof, the "Market Price"
shall mean: the 4:00 p.m. closing bid prices for the Common Stock on the OTC
Pink Sheets, NASD OTC Bulletin Board, NASDAQ Small Cap Market, NASDAQ National
Market System, American Stock Exchange, or New York Stock Exchange (whichever of
the foregoing is at the time the principal trading exchange or market for the
Common Stock, or if the shares are not then trading on a Principal Market, such
other market or exchange where the Common Stock is listed or traded.
SECTION 10. NOTICES OF ADJUSTMENTS. Upon the happening of any event requiring an
adjustment of the Warrant Price or the number of Warrant Shares purchasable
hereunder, the Company shall promptly give written notice thereof to the Holder
at the address appearing in the records of the Company, stating the adjusted
Warrant Price and/or the adjusted number of Warrant Shares resulting from such
event and setting forth in reasonable detail the method of calculation and the
facts upon which such calculation is based. Failure to give such notice to the
Holder or any defect therein shall not affect the legality or validity of the
subject adjustment.
SECTION 11. BENEFIT. Nothing in this Warrant shall be construed to give any
person, firm or corporation (other than the Company and the Holder) any legal or
equitable right, remedy or claim, it being agreed that this Warrant shall be for
the sole and exclusive benefit of the Company and the Holder.
..
SECTION 12 . NOTICE OF CERTAIN EVENTS. The Company shall give the Holder at
least 20 days' prior written notice before the earlier of the establishment of
any record date in connection with, or any closing or effective date for, any of
the events described in Sections 8(a) or 8 (b) hereof.
SECTION 13. NOTICE, Unless otherwise specifically provided herein, all
communications under this Warrant shall be in writing and shall be deemed to
have been duly given (a) on the date personally delivered to the party to whom
notice is to be given, (b) on the business day after delivery to Federal Express
or similar overnight courier which utilizes a written form of receipt, or (c) on
the third day after mailing, if mailed to the party to whom notice is to be
given, by first class mail, registered or certified, postage prepaid, and
properly addressed, return receipt requested. All notices shall be addressed as
follows or at such other address as the Warrant holder or the Company may
designate by five days' advance written notice to the other:
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If to the Company:
Turbodyne Technologies, Inc
000 Xxxxx Xxxx
Xxxxx Xxxxxxx, XX 00000
If to the Holder:
--------------------------
--------------------------
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Section 14. REGISTRATION. The Company shall maintain books for the transfer and
registration of the Warrant. Upon the initial issuance of this Warrant, the
Company shall issue and register the Warrant in the name of the Holder.
Section 15. SUCCESSORS. All the covenants and provisions hereof by or for the
benefit of the Holder shall bind and inure to the benefit of its respective
successors and assigns hereunder.
Section 16. GOVERNING LAW. This Warrant shall be governed by, and construed in
accordance with, the internal laws of the State of New York, without reference
to the choice of law provisions thereof. The Company and, by accepting this
Warrant, the Holder, each irrevocably submits to the exclusive jurisdiction of
the courts of the State of New York located in Manhattan County and the United
States District Court for the Southern District of New York for the purpose of
any suit, action, proceeding or judgment relating to or arising out of this
Warrant and the transactions contemplated hereby. Service of process in
connection with any such suit, action or proceeding may be served on each party
hereto anywhere in the world by the same methods as are specified for the giving
of notices under this Warrant. The Company and, by accepting this Warrant, the
Holder, each irrevocably consents to the jurisdiction of any such court in any
such suit, action or proceeding and to the laying of venue in such court
Section 17. NO RIGHTS AS SHAREHOLDER. Prior to the exercise of this Warrant, the
Holder shall not have or exercise any rights as a shareholder of the Company by
virtue of its ownership of this Warrant unless specifically set forth herein.
Section 18. AMENDMENTS. This Warrant shall not be amended without the prior
written consent of the Company and the then current Holder.
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Section 19. SECTION HEADINGS. The section headings in this Warrant are for the
convenience of the Company and the Holder and in no way alter, modify, amend,
limit or restrict the provisions hereof.
IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed, as
of this , 2007
Turbodyne Technologies Inc.
By:___________________________
Name: _____________________
Title: _____________________
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APPENDIX A
TURBODYNE TECHNOLOGIES INC
WARRANT EXERCISE FORM
To:. Turbodyne Technologies Inc
The undersigned hereby irrevocably elects to exercise the right of
purchase represented by the within Warrant ("Warrant") for, and to purchase
thereunder by the payment of the Warrant Price and surrender of the Warrant,
_______________ shares of Common Stock ("Warrant Shares") provided for therein,
and requests that certificates for the Warrant Shares be issued as follows:
-------------------------------
Name
--------------------------------
Address
================================
Federal Tax ID or Social Security No.
and delivered by
|_| certified mail to the above address, or
|_| electronically (provide DWAC Instructions:___________________), or
|_| other (specify: __________________________________________).
and, if the number of Warrant Shares shall not be all the Warrant Shares
purchasable upon exercise of the Warrant, that a new Warrant for the balance of
the Warrant Shares purchasable upon exercise of this Warrant be registered in
the name of the undersigned Holder or the undersigned's Assignee as below
indicated and delivered to the address stated below.
Dated: ___________________, ____
Note: The signature must correspond with the Signature:_____________________
name of the registered holder as written on the ______________________________
first page of the Warrant in every particular, Name (please print)
without alteration or enlargement or any change _____________________
whatever, unless the Warrant has been assigned. _____________________
Address
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Federal Identification or
Social Security No.
B-1
