EXHIBIT
10.23






AMENDMENT NO. 1 TO STOCK AND
WARRANT PURCHASE AGREEMENT






THIS AMENDMENT TO STOCK AND WARRANT
PURCHASE AGREEMENT (“Amendment”) is made as of the thirtieth day of March, 2009
by and among Balqon Corporation, a Nevada corporation (the “Company”) and Marlin
Financial Group, Inc. (“Marlin”) to be effective as of June 4,
2008.




Recitals




A.           On
October 24, 2008, the Company assumed the rights and obligations of Balqon
Corporation, a California corporation (“Balqon California”), under that certain
Stock and Warrant Purchase Agreement, dated August 28, 2008, by and between
Balqon California and Marlin (the “Initial Agreement”).




B.           A
review of the records of Balqon California evidences that while the Initial
Agreement was memorialized on August 28, 2008, Balqon California and Marlin
intended on entering into such agreement, and in fact entered into such
agreement orally, on June 4, 2008.




C.           Certain
terms set forth in the Initial Agreement does not evidence the intent of Balqon
California and Marlin on June 4, 2008.




D.           Accordingly,
the Company and Marlin desire to amend certain provisions of the Initial
Agreement to accurately set forth their intentions and agreements on June 4,
2008.





Agreement




NOW
THEREFORE, in consideration of the foregoing premises and the respective
promises and agreements of the parties set forth herein, the parties hereto
agree as follows:




1.
            Definitions. Capitalized
      terms used herein and not otherwise defined herein shall have the
      respective meanings ascribed thereto in the Initial
    Agreement.




2.
            Amendments.




2.1.
            The
      Initial Agreement is hereby amended by deleting any reference to August
      28, 2008, or August __ 2008, and replacing such reference with June 4,
      2008.




2.2.
            Section
      1.3 to the Initial Agreement is hereby amended by deleting such section in
      its entirety and inserting in its place the following:




“1.3           Warrants and Warrant
Shares: Investor shall be issued the Warrants in the form attached as
Exhibit A such that (i) one third of the Warrants (i.e. Warrants to purchase
243,060 shares of Common Stock) shall have an exercise price of $1.50 per share
and shall terminate at the close of business on the day preceding June 10, 2010,
(ii) one third of the Warrants (i.e. Warrants to purchase 243,060 shares of
Common Stock) shall have an exercise price of $2.00 per share and shall
terminate at the close of business on the day preceding June 10, 2011, and (iii)
one third of the Warrants (i.e. Warrants to purchase 243,060 shares of Common
Stock) shall have an exercise price of $2.50 per share and shall terminate at
the at the close of business on the day preceding June 10,
2012.”




1




2.3.
            Section
      3.7(c) of the Initial Agreement is hereby amended by deleting subsection
      (iii) to Section 3.7(c) in its entirety and inserting in its place the
      following:




“(iii)
Investor will not Transfer a greater percentage of the securities held by
Investor on the date hereof than the percentage of securities Samra will have
already Transferred of the total number of securities held by Samra on the date
hereof.”




3.
            Miscellaneous.  Except
      as modified and amended pursuant to this Amendment, the Initial Agreement
      shall remain in full force and effect.  This Amendment may be
      executed in one or more counterparts, each of which shall be deemed an
      original, but all of which taken together shall constitute one and the
      same instrument.









[signature
page follows]




2







IN WITNESS WHEREOF, the parties have
caused their duly authorized officers to execute this Amendment No. 1 to Warrant
and Stock Purchase Agreement as of the date first above written.




The
      Company:
              Balqon
      CorporationBy:
              /s/ B.
      SamraName :
      B. Samra
                Title: Chief Executive Officer




Marlin:
                MARLIN
      FINANCIAL GROUP, INC.By:
                /s/ Mark
      LevinName :
      Mark Levin
                  Title: President






3




EXHIBIT
A






NEITHER THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON THE
EXERCISE OF THESE SECURITIES HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR
ANY STATE SECURITIES LAWS.  THE SECURITIES REPRESENTED HEREBY MAY NOT
BE EXERCISED, OFFERED, SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED OR OTHERWISE
ASSIGNED (EACH A “TRANSFER”) EXCEPT (A)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSFER NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (B) TO THE EXTENT THE
TRANSFER DOES NOT CONSTITUTE AND WILL NOT RESULT IN A VIOLATION OF APPLICABLE
FEDERAL OR STATE SECURITIES LAWS, AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
THE TRANSFEROR TO SUCH EFFECT (TO THE EXTENT REQUESTED BY COUNSEL OF THE
COMPANY), THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY.  THE HOLDER HEREOF AGREES THAT IT WILL DELIVER, OR CAUSE TO
BE DELIVERED, TO EACH PERSON TO WHOM THE SECURITIES HEREBY REPRESENTED ARE
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND.  THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE OF
THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
SECURED BY SUCH SECURITIES.
  
 STOCK
PURCHASE WARRANT
 
 BALQON
CORPORATION
  
  Original
Issue Date: June 4, 2008
  THIS
CERTIFIES that, for value received, Marlin Financial Group (the “Holder”), is
entitled, upon the terms and subject to the conditions hereinafter set forth, to
subscribe for and purchase, from BALQON CORPORATION, a California corporation
(the “Company”), at any
time upon the terms and subject to the conditions set forth herein, from the
Company, 243,060 shares of common stock (“Common Stock”) of the
Company (the “Warrant
Shares”).  The exercise price of one share of Common Stock
under this Warrant shall be $1.50 (“Exercise Price”),
subject to adjustment as provided herein.  If the purchase rights
represented by this Warrant are not exercised before the close of business on
the day preceding June 30, 2010, this Warrant shall be void.
  1.           Title of
Warrant.  Prior to the expiration hereof and subject to
compliance with applicable laws, this Warrant and all rights hereunder are
transferable, in whole or in part, at the office or agency of the Company,
referred to in Section 3
hereof, by the holder hereof in person or by duly authorized attorney, upon
surrender of this Warrant together with the Assignment Form annexed hereto
properly endorsed.
  4
  2.           Investment
Representations.
  (a)           Holder
confirms that it has been given sufficient access to information regarding the
Company and in connection with its decision to receive this Warrant, including
any common stock issuable upon the exercise of this Warrant (collectively, the
“Securities”),
including the opportunity to ask questions of, and receive answers from, persons
acting on behalf of Company and concerning Company’s financial affairs,
prospects and condition.
  (b)           Holder
represents and warrants that (i) it is resident in or otherwise subject to the
securities legislation of the United States, and the issuance of the Securities
to Holder has occurred only in the United States; (ii) Holder, by reason of its
business or financial expertise, has the capacity to protect its own interests
in connection with its acquisition of the Securities; and (iii) Holder is an
“accredited investor” as defined in Rule 501 of Regulation D of the Securities
Act of 1933, as amended (the “Securities
Act”).
  (c)           Holder
represents, warrants and covenants that it shall acquire the Securities for its
own account and not for the account or on behalf of others, and it is doing so
with the intent of retaining such Securities as an investment and without the
current intent to redistribute such Securities.
  (d)           Holder
acknowledges that: (i) no securities commission or similar authority has
reviewed or passed on the merits of the Securities; (ii) there is no government
or other insurance covering such Securities; and (iii) there are risks
associated with the acquisition of the Securities.
  (e)           Holder
acknowledges that (i) it must and shall bear the economic risk of holding the
Securities, which may be for an indefinite period of time, because at the time
such Securities are issued they will not have been registered under the
Securities Act or any other securities law and, therefore, cannot be sold unless
they are subsequently registered under applicable federal and state securities
laws or an exemption from such registration is available; (ii) the Securities
may not be resold or transferred on the official stock transfer records of
Company without furnishing to Company an opinion of counsel reasonably
acceptable to Company that such sale or transfer of the Securities will not
violate the registration provisions of applicable federal and state securities
laws; and (iii) certificates representing the Securities shall have endorsed on
them a restrictive legend to this effect.
  (f)           Holder
acknowledges that Company is relying on the representations, warranties,
covenants and acknowledgments in this Section 2 to
ensure that the Securities can be issued in reliance on exemptions from
registration requirements under United States federal and state securities
laws.
  3.           Exercise of
Warrant.
  (a)           The
purchase rights represented by this Warrant are exercisable by the Holder by the
surrender of this Warrant and the Notice of Exercise annexed hereto duly
completed and executed on behalf of the Holder, at the office of the Company (or
such other office or agency of the Company as it may designate by notice in
writing to the Holder at the address of the Holder appearing on the books of the
Company), upon payment in cash, certified check or wire transfer of funds, of
the aggregate Exercise Price for that number of Warrant Shares then being
purchased.
  5
  (b)           This
Warrant shall be deemed to have been exercised immediately prior to the close of
business on the date of its surrender for exercise as provided above, and the
person entitled to receive the shares of Common Stock issuable upon such
exercise shall be treated for all purposes as the holder of record of such
shares as of the close of business on such date.  As promptly as
practicable on or after such date and in any event within ten (10) days
thereafter, the Company at its expense shall issue and deliver to the person or
persons entitled to receive the same a certificate or certificates for the
number of shares issuable upon such exercise.  In the event that this
Warrant is exercised in part, the Company at its expense will execute and
deliver a new Warrant of like tenor exercisable for the number of shares for
which this Warrant may then be exercised.  Each exercise hereof shall
constitute the reaffirmation by the holder hereof that the representations and
warranties contained in Section 2 of
this Warrant true and correct in all material respects with respect to the
Holder of the Warrant as of the time of such exercise.
  4.           No Fractional Shares or
Scrip.  No fractional shares or scrip representing fractional
shares shall be issued upon the exercise of this Warrant.  With
respect to any fraction of a share called for upon the exercise of this Warrant,
an amount equal to such fraction multiplied by the then current price at which
each share may be purchased hereunder shall be paid in cash to the holder of
this Warrant.
  5.           Charges, Taxes and
Expenses.  Issuance of certificates for shares of Common Stock
upon the exercise of this Warrant shall be made without charge to the holder
hereof for any issue or transfer tax or other incidental expense in respect of
the issuance of such certificate, all of which taxes and expenses shall be paid
by the Company, and such certificates shall be issued in the name of the holder
of this Warrant or in such name or names as may be directed by the holder of
this Warrant; provided, however, that in the event certificates for shares of
Common Stock are to be issued in a name other than the name of the holder of
this Warrant, this Warrant when surrendered for exercise shall be accompanied by
the Assignment Form attached hereto duly executed by the holder hereof; and
provided further, that upon any transfer involved in the issuance or delivery of
any certificates for shares of Common Stock, the Company may require, as a
condition thereto, the payment of a sum sufficient to reimburse it for any
transfer tax incidental thereto.  The Holder of the Warrant shall be
responsible for income taxes due under federal, state, or other law, if any, if
any such tax is due.
  6.           No Rights as
Stockholders.  This Warrant does not entitle the holder hereof
to any voting rights or other rights as a stockholder of the Company prior to
the exercise thereof.  Nothing in this Warrant shall be construed to
give any person, firm or corporation (other than the Company and the Holder of
this Warrant) 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 of this Warrant.
  7.           Exchange and Registry of
Warrant.  This Warrant is exchangeable, upon the surrender
hereof by the registered holder at the above-mentioned office or agency of the
Company, for a new Warrant of like tenor and dated as of such
exchange.  The Company shall maintain at the above-mentioned office or
agency a registry showing the name and address of the registered holder of this
Warrant.  This Warrant may be surrendered for exchange, transfer or
exercise, in accordance with its terms, at such office or agency of the Company,
and the Company shall be entitled to rely in all respects, prior to written
notice to the contrary, upon such registry.
  6
  8.           Loss, Theft, Destruction or
Mutilation of Warrant.  Upon receipt by the Company of evidence
reasonably satisfactory to it of the loss, theft, destruction or mutilation of
this Warrant, and in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to it, and upon reimbursement to the Company of
all reasonable expenses incidental thereto, and upon surrender and cancellation
of this Warrant, if mutilated, the Company will make and deliver a new Warrant
of like tenor and dated as of such cancellation, in lieu of this
Warrant.
  9.           Saturdays, Sundays,
Holidays, etc.  If the last or appointed day for the taking of
any action or the expiration of any right required or granted herein shall be a
Saturday or a Sunday or shall be a legal holiday, then such action may be taken
or such right may be exercised on the next succeeding day not a legal
holiday.
  10.           Transferability and
Nonnegotiability of Warrant.  This Warrant may not be
transferred or assigned in whole or in part without compliance with all
applicable federal and state securities laws by the transferor and the
transferee (including the delivery of investment representation letters and
legal opinions reasonably satisfactory to the Company, if such are requested by
the Company).  Subject to the provisions of this Warrant with respect
to compliance with the Securities Act, title to this Warrant may be transferred
by endorsement (by the Holder executing the Assignment Form annexed hereto) and
delivery in the same manner as a negotiable instrument transferable by
endorsement and delivery.
  11.           Compliance With Securities
Laws.
  (a)           The
Holder of this Warrant represents and warrants that this Warrant and the shares
of Common Stock to be issued upon exercise hereof are being acquired solely for
the Holder’s own account and not as a nominee for any other party, and for
investment, and that the Holder will not offer, sell or otherwise dispose of
this Warrant or any shares of Common Stock to be issued upon exercise hereof
except under circumstances that will not result in a violation of the Securities
Act or any state securities laws.  Upon exercise of this Warrant, the
Holder shall, if requested by the Company, confirm in writing, in a form
satisfactory to the Company, that the shares of Common Stock so purchased are
being acquired solely for the Holder’s own account and not as a nominee for any
other party, for investment, and not with a view toward distribution or
resale.
  (b)           This
Warrant and all shares of Common Stock issued upon exercise hereof shall be
stamped or imprinted with a legend in substantially the following form (in
addition to any legend required by state securities laws):
  7
  NEITHER
THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON THE EXERCISE OF THESE
SECURITIES HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS.  THE SECURITIES
REPRESENTED HEREBY MAY NOT BE EXERCISED, OFFERED, SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE ASSIGNED (EACH A “TRANSFER”) EXCEPT (A)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSFER NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (B) TO THE EXTENT THE
TRANSFER DOES NOT CONSTITUTE AND WILL NOT RESULT IN A VIOLATION OF APPLICABLE
FEDERAL OR STATE SECURITIES LAWS, AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
THE TRANSFEROR TO SUCH EFFECT (TO THE EXTENT REQUESTED BY COUNSEL OF THE
COMPANY), THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY.  THE HOLDER HEREOF AGREES THAT IT WILL DELIVER, OR CAUSE TO
BE DELIVERED, TO EACH PERSON TO WHOM THE SECURITIES HEREBY REPRESENTED ARE
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND.  THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE OF
THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
SECURED BY SUCH SECURITIES.
  12.           Early Termination and
Reclassification.
  (a)           Merger, Sale of Assets,
etc.  If all or any portion of this Warrant is exercised
subsequent to a merger, consolidation, exchange of shares, reorganization, or
other similar event (“Change in Control”)
occurring after the date hereof, as a result of which shares shall be changed
into cash, other property, or the same or a different number of shares of the
same or another class or classes of securities of the Company or another entity,
the Holder exercising this Warrant shall receive, for the exercise price, the
aggregate amount of cash or other property and the aggregate number of shares
and class of securities which the Holder would have received if this Warrant was
exercised immediately before the Change in Control.  If an adjustment
under this section would create a fractional share or a right to acquire a
fractional share, the fractional share will be rounded up to, and issued as, a
whole share.  If, pursuant to a Change of Control event, the shares
shall be exchanged solely for cash (in such case, a “Triggering Event”),
then the Company shall give the Holder written notice describing the material
terms and conditions of such impending transaction not later than ten (10) days
prior to the stockholders’ meeting called to approve such transaction (or such
longer period if required by the General Corporation Law of the State of
California), or ten (10) days prior to the closing of such transaction (or such
longer period if required by the General Corporation Law of the State of
California), whichever is earlier, and shall also notify the holder of this
Warrant of the final approval of such transaction.
  (b)           Reclassification,
etc.  If the Company at any time shall, by subdivision,
combination or reclassification of securities or otherwise, change any of the
securities to which purchase rights under this Warrant exist into the same or a
different number of securities of any class or classes, this Warrant shall
thereafter be to acquire such number and kind of securities as would have been
issuable as the result of such change with respect to the securities which were
subject to the purchase rights under this Warrant immediately prior to such
subdivision, combination, reclassification or other change.  If shares
of the Company’s Common Stock are subdivided or combined into a greater or
smaller number of shares of Common Stock, the purchase price under this Warrant
shall be proportionately reduced in case of subdivision of shares or
proportionately increased in the case of combination of shares and the number of
shares of Common Stock purchasable under this Warrant shall be proportionally
increased in the case of a subdivision and decreased in the case of combination,
in all cases by the ratio which the total number of shares of Common Stock to be
outstanding immediately after such event bears to the total number of shares of
Common Stock outstanding immediately prior to such event.
  8
  (c)           Cash
Distributions.  No adjustment on account of cash dividends or
interest on the Company’s Common Stock or other securities purchasable hereunder
will be made to the purchase price under this Warrant .
  (d)           Authorized
Shares.  The Company covenants that during the period the
Warrant is outstanding, it will reserve from its authorized and unissued Common
Stock a sufficient number of shares to provide for the issuance of Common Stock
upon the exercise of any purchase rights under this Warrant.  The
Company further covenants that its issuance of this Warrant shall constitute
full authority to its officers who are charged with the duty of executing stock
certificates to execute and issue the necessary certificates for shares of the
Company’s Common Stock upon the exercise of the purchase rights under this
Warrant.
  13.           Miscellaneous.
  (a)           Issue
Date.  The provisions of this Warrant shall be construed and
shall be given effect in all respect as if it had been issued and delivered by
the Company on the date hereof.  This Warrant shall be binding upon
any successors or assigns of the Company.  This Warrant shall
constitute a contract under the laws of the State of California and for all
purposes shall be construed in accordance with and governed by the laws of said
state.
  (b)           Restrictions.  The
holder hereof acknowledges that the Common Stock acquired upon the exercise of
this Warrant may have restrictions upon its resale imposed by state and federal
securities laws.
  (c)           Entire Agreement and
Amendments.  This Warrant constitutes the entire agreement of
the parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and the Holder
with respect to the subject matter hereof, and may not be modified adversely to
the Holder’s interest except by means of a writing signed by the Company and the
Holder.
  (d)           Notices.  Unless
otherwise provided, any notice required or permitted under this Warrant shall be
given in writing and shall be deemed effectively given as hereinafter described
(i) if given by personal delivery, then such notice shall be deemed given upon
such delivery, (ii) if given by telex, facsimile or e-mail, then such notice
shall be deemed given upon receipt of confirmation of complete transmittal,
(iii) if given by mail, then such notice shall be deemed given upon the earlier
of (A) receipt of such notice by the recipient or (B) three days after such
notice is deposited in first class mail, postage prepaid, and (iv) if given by
an internationally recognized overnight air courier, then such notice shall be
deemed given one business day after delivery to such carrier.  All
notices shall be addressed as follows: if to the Holder of the Warrant, at its
address as set forth in the Company’s books and records and, if to the Company,
at the address as follows, or at such other address as the Holder of the
Warrant, or the Company may designate by ten days’ advance written notice to the
other:
  9
  If to the
Company:
  Balqon
Corporation
 1701 E.
Edinger, Unit E-3
 Santa
Ana, California 92705
 If to
Holder:
 ________________________________
  ________________________________
  ________________________________
  (e)           Binding Agreement;
Assignment.  The terms and conditions of this Warrant shall
inure to the benefit of and be binding upon the respective successors and
permitted assigns of the parties.  Nothing in this Warrant, express or
implied, is intended to confer upon any third party any rights, remedies,
obligations, or liabilities under or by reason of this Warrant.  This
Warrant may not be assigned by Holder (other than to a Related Person) without
the prior written consent of the Company.  “Related Person” shall
mean with respect to any Holder (i) any affiliate of such person, (ii) any
investment fund, investment account or investment entity whose investment
manager, investment advisor or general partner, is such Holder or any affiliate
of such Holder or any member, partner, officer or employee of such Holder or any
affiliate of such Holder, (iii) any member or partner of any Holder specified in
clause (i) or (ii) above, and (iv) any officer or employee of any person
specified in clause (i), (ii) or (iii) above.
  (signature
page follows)
  10
  IN
WITNESS WHEREOF, BALQON CORPORATION has caused this Warrant to be executed by
its officers thereunto duly authorized.
  BALQON
      CORPORATIONDate
                By:Balwinder
      Samra, President
  Name
      of Holder:
              Marlin Financial
      Group(Signature)Address:Telephone:Facsimile:




11


NOTICE OF
EXERCISE
  To:           BALQON
CORPORATION
  (1)           The
undersigned hereby elects to purchase ____________ shares of Common
Stock  of BALQON CORPORATION pursuant to the provisions of Section 3(a) of
the attached Warrant, and tenders herewith payment of the purchase price for
such shares in full.
  (2)           In
exercising this Warrant, the undersigned hereby confirms and acknowledges that
the shares of Common Stock to be issued upon exercise thereof are being acquired
solely for the account of the undersigned and not as a nominee for any other
party, and for investment, and that the undersigned will not offer, sell or
otherwise dispose of any such shares of Common Stock except under circumstances
that will not result in a violation of the Securities Act, or any applicable
state securities laws.
  (3)           In
exercising this Warrant, the undersigned hereby affirms that the representations
and warranties contained in Section 2 of
this Warrant are true and correct in all material respects.
  (4)           Please
issue a certificate or certificates representing said shares of Common Stock in
the name of the undersigned or in such other name as specified
below:
  NameName
  (5)           Please
issue a new Warrant for the unexercised portion of the attached Warrant in the
name of the undersigned or in such other name as is specified
below:
  Name(Date)
                  
                  
                  Signature
  12
  ASSIGNMENT
FORM
  FOR VALUE
RECEIVED, the undersigned registered owner of this Warrant hereby sells, assigns
and transfers unto the Assignee named below all of the rights of the undersigned
under the within Warrant, with respect to the number of shares of Common Stock
set forth below:
 Name
      of Assignee
              Address
              No.
      of Shares
  and does
hereby irrevocable constitute and appoint _______________________ Attorney to
make such transfer on the books of BALQON CORPORATION, maintained for the
purpose, with full power of substitution in the premises.
  The
undersigned also represents that, by assignment hereof, the Assignee
acknowledges that this Warrant and the shares of Common Stock to be issued upon
exercise hereof or conversion thereof are being acquired for investment and that
the Assignee will not offer, sell or otherwise dispose of this Warrant or any
shares of Common Stock to be issued upon exercise hereof or conversion thereof
except under circumstances which will not result in a violation of the
Securities Act or any state securities laws.  Further, the Assignee
has acknowledged that upon exercise of this Warrant, the Assignee shall, if
requested by the Company, confirm in writing, in a form satisfactory to the
Company, that the shares of Common Stock so purchased are being acquired for
investment and not with a view toward distribution or resale.
  Dated:
 Signature
      of Holder
  13
  NEITHER
THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON THE EXERCISE OF THESE
SECURITIES HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS.  THE SECURITIES
REPRESENTED HEREBY MAY NOT BE EXERCISED, OFFERED, SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE ASSIGNED (EACH A “TRANSFER”) EXCEPT (A)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSFER NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (B) TO THE EXTENT THE
TRANSFER DOES NOT CONSTITUTE AND WILL NOT RESULT IN A VIOLATION OF APPLICABLE
FEDERAL OR STATE SECURITIES LAWS, AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
THE TRANSFEROR TO SUCH EFFECT (TO THE EXTENT REQUESTED BY COUNSEL OF THE
COMPANY), THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY.  THE HOLDER HEREOF AGREES THAT IT WILL DELIVER, OR CAUSE TO
BE DELIVERED, TO EACH PERSON TO WHOM THE SECURITIES HEREBY REPRESENTED ARE
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND.  THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE OF
THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
SECURED BY SUCH SECURITIES.
  
 STOCK
PURCHASE WARRANT
 
 BALQON
CORPORATION
  
  Original
Issue Date: June 4, 2008
  THIS
CERTIFIES that, for value received, Marlin Financial Group (the “Holder”), is
entitled, upon the terms and subject to the conditions hereinafter set forth, to
subscribe for and purchase, from BALQON CORPORATION, a California corporation
(the “Company”), at any
time upon the terms and subject to the conditions set forth herein, from the
Company, 243,060 shares of common stock (“Common Stock”) of the
Company (the “Warrant
Shares”).  The exercise price of one share of Common Stock
under this Warrant shall be $2.00 (“Exercise Price”),
subject to adjustment as provided herein.  If the purchase rights
represented by this Warrant are not exercised before the close of business on
the day preceding June 30, 2011, this Warrant shall be void.
  1.           Title of
Warrant.  Prior to the expiration hereof and subject to
compliance with applicable laws, this Warrant and all rights hereunder are
transferable, in whole or in part, at the office or agency of the Company,
referred to in Section 3
hereof, by the holder hereof in person or by duly authorized attorney, upon
surrender of this Warrant together with the Assignment Form annexed hereto
properly endorsed.
  14
  2.           Investment
Representations.
  (a)           Holder
confirms that it has been given sufficient access to information regarding the
Company and in connection with its decision to receive this Warrant, including
any common stock issuable upon the exercise of this Warrant (collectively, the
“Securities”),
including the opportunity to ask questions of, and receive answers from, persons
acting on behalf of Company and concerning Company’s financial affairs,
prospects and condition.
  (b)           Holder
represents and warrants that (i) it is resident in or otherwise subject to the
securities legislation of the United States, and the issuance of the Securities
to Holder has occurred only in the United States; (ii) Holder, by reason of its
business or financial expertise, has the capacity to protect its own interests
in connection with its acquisition of the Securities; and (iii) Holder is an
“accredited investor” as defined in Rule 501 of Regulation D of the Securities
Act of 1933, as amended (the “Securities
Act”).
  (c)           Holder
represents, warrants and covenants that it shall acquire the Securities for its
own account and not for the account or on behalf of others, and it is doing so
with the intent of retaining such Securities as an investment and without the
current intent to redistribute such Securities.
  (d)           Holder
acknowledges that: (i) no securities commission or similar authority has
reviewed or passed on the merits of the Securities; (ii) there is no government
or other insurance covering such Securities; and (iii) there are risks
associated with the acquisition of the Securities.
  (e)           Holder
acknowledges that (i) it must and shall bear the economic risk of holding the
Securities, which may be for an indefinite period of time, because at the time
such Securities are issued they will not have been registered under the
Securities Act or any other securities law and, therefore, cannot be sold unless
they are subsequently registered under applicable federal and state securities
laws or an exemption from such registration is available; (ii) the Securities
may not be resold or transferred on the official stock transfer records of
Company without furnishing to Company an opinion of counsel reasonably
acceptable to Company that such sale or transfer of the Securities will not
violate the registration provisions of applicable federal and state securities
laws; and (iii) certificates representing the Securities shall have endorsed on
them a restrictive legend to this effect.
  (f)           Holder
acknowledges that Company is relying on the representations, warranties,
covenants and acknowledgments in this Section 2 to
ensure that the Securities can be issued in reliance on exemptions from
registration requirements under United States federal and state securities
laws.
  3.           Exercise of
Warrant.
  (a)           The
purchase rights represented by this Warrant are exercisable by the Holder by the
surrender of this Warrant and the Notice of Exercise annexed hereto duly
completed and executed on behalf of the Holder, at the office of the Company (or
such other office or agency of the Company as it may designate by notice in
writing to the Holder at the address of the Holder appearing on the books of the
Company), upon payment in cash, certified check or wire transfer of funds, of
the aggregate Exercise Price for that number of Warrant Shares then being
purchased.
  15
  (b)           This
Warrant shall be deemed to have been exercised immediately prior to the close of
business on the date of its surrender for exercise as provided above, and the
person entitled to receive the shares of Common Stock issuable upon such
exercise shall be treated for all purposes as the holder of record of such
shares as of the close of business on such date.  As promptly as
practicable on or after such date and in any event within ten (10) days
thereafter, the Company at its expense shall issue and deliver to the person or
persons entitled to receive the same a certificate or certificates for the
number of shares issuable upon such exercise.  In the event that this
Warrant is exercised in part, the Company at its expense will execute and
deliver a new Warrant of like tenor exercisable for the number of shares for
which this Warrant may then be exercised.  Each exercise hereof shall
constitute the reaffirmation by the holder hereof that the representations and
warranties contained in Section 2 of
this Warrant true and correct in all material respects with respect to the
Holder of the Warrant as of the time of such exercise.
  4.           No Fractional Shares or
Scrip.  No fractional shares or scrip representing fractional
shares shall be issued upon the exercise of this Warrant.  With
respect to any fraction of a share called for upon the exercise of this Warrant,
an amount equal to such fraction multiplied by the then current price at which
each share may be purchased hereunder shall be paid in cash to the holder of
this Warrant.
  5.           Charges, Taxes and
Expenses.  Issuance of certificates for shares of Common Stock
upon the exercise of this Warrant shall be made without charge to the holder
hereof for any issue or transfer tax or other incidental expense in respect of
the issuance of such certificate, all of which taxes and expenses shall be paid
by the Company, and such certificates shall be issued in the name of the holder
of this Warrant or in such name or names as may be directed by the holder of
this Warrant; provided, however, that in the event certificates for shares of
Common Stock are to be issued in a name other than the name of the holder of
this Warrant, this Warrant when surrendered for exercise shall be accompanied by
the Assignment Form attached hereto duly executed by the holder hereof; and
provided further, that upon any transfer involved in the issuance or delivery of
any certificates for shares of Common Stock, the Company may require, as a
condition thereto, the payment of a sum sufficient to reimburse it for any
transfer tax incidental thereto.  The Holder of the Warrant shall be
responsible for income taxes due under federal, state, or other law, if any, if
any such tax is due.
  6.           No Rights as
Stockholders.  This Warrant does not entitle the holder hereof
to any voting rights or other rights as a stockholder of the Company prior to
the exercise thereof.  Nothing in this Warrant shall be construed to
give any person, firm or corporation (other than the Company and the Holder of
this Warrant) 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 of this Warrant.
  7.           Exchange and Registry of
Warrant.  This Warrant is exchangeable, upon the surrender
hereof by the registered holder at the above-mentioned office or agency of the
Company, for a new Warrant of like tenor and dated as of such
exchange.  The Company shall maintain at the above-mentioned office or
agency a registry showing the name and address of the registered holder of this
Warrant.  This Warrant may be surrendered for exchange, transfer or
exercise, in accordance with its terms, at such office or agency of the Company,
and the Company shall be entitled to rely in all respects, prior to written
notice to the contrary, upon such registry.
  16
  8.           Loss, Theft, Destruction or
Mutilation of Warrant.  Upon receipt by the Company of evidence
reasonably satisfactory to it of the loss, theft, destruction or mutilation of
this Warrant, and in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to it, and upon reimbursement to the Company of
all reasonable expenses incidental thereto, and upon surrender and cancellation
of this Warrant, if mutilated, the Company will make and deliver a new Warrant
of like tenor and dated as of such cancellation, in lieu of this
Warrant.
  9.           Saturdays, Sundays,
Holidays, etc.  If the last or appointed day for the taking of
any action or the expiration of any right required or granted herein shall be a
Saturday or a Sunday or shall be a legal holiday, then such action may be taken
or such right may be exercised on the next succeeding day not a legal
holiday.
  10.           Transferability and
Nonnegotiability of Warrant.  This Warrant may not be
transferred or assigned in whole or in part without compliance with all
applicable federal and state securities laws by the transferor and the
transferee (including the delivery of investment representation letters and
legal opinions reasonably satisfactory to the Company, if such are requested by
the Company).  Subject to the provisions of this Warrant with respect
to compliance with the Securities Act, title to this Warrant may be transferred
by endorsement (by the Holder executing the Assignment Form annexed hereto) and
delivery in the same manner as a negotiable instrument transferable by
endorsement and delivery.
  11.           Compliance With Securities
Laws.
  (a)           The
Holder of this Warrant represents and warrants that this Warrant and the shares
of Common Stock to be issued upon exercise hereof are being acquired solely for
the Holder’s own account and not as a nominee for any other party, and for
investment, and that the Holder will not offer, sell or otherwise dispose of
this Warrant or any shares of Common Stock to be issued upon exercise hereof
except under circumstances that will not result in a violation of the Securities
Act or any state securities laws.  Upon exercise of this Warrant, the
Holder shall, if requested by the Company, confirm in writing, in a form
satisfactory to the Company, that the shares of Common Stock so purchased are
being acquired solely for the Holder’s own account and not as a nominee for any
other party, for investment, and not with a view toward distribution or
resale.
  (b)           This
Warrant and all shares of Common Stock issued upon exercise hereof shall be
stamped or imprinted with a legend in substantially the following form (in
addition to any legend required by state securities laws):
  17
  NEITHER
THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON THE EXERCISE OF THESE
SECURITIES HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS.  THE SECURITIES
REPRESENTED HEREBY MAY NOT BE EXERCISED, OFFERED, SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE ASSIGNED (EACH A “TRANSFER”) EXCEPT (A)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSFER NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (B) TO THE EXTENT THE
TRANSFER DOES NOT CONSTITUTE AND WILL NOT RESULT IN A VIOLATION OF APPLICABLE
FEDERAL OR STATE SECURITIES LAWS, AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
THE TRANSFEROR TO SUCH EFFECT (TO THE EXTENT REQUESTED BY COUNSEL OF THE
COMPANY), THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY.  THE HOLDER HEREOF AGREES THAT IT WILL DELIVER, OR CAUSE TO
BE DELIVERED, TO EACH PERSON TO WHOM THE SECURITIES HEREBY REPRESENTED ARE
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND.  THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE OF
THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
SECURED BY SUCH SECURITIES.
  12.           Early Termination and
Reclassification.
  (a)           Merger, Sale of Assets,
etc.  If all or any portion of this Warrant is exercised
subsequent to a merger, consolidation, exchange of shares, reorganization, or
other similar event (“Change in Control”)
occurring after the date hereof, as a result of which shares shall be changed
into cash, other property, or the same or a different number of shares of the
same or another class or classes of securities of the Company or another entity,
the Holder exercising this Warrant shall receive, for the exercise price, the
aggregate amount of cash or other property and the aggregate number of shares
and class of securities which the Holder would have received if this Warrant was
exercised immediately before the Change in Control.  If an adjustment
under this section would create a fractional share or a right to acquire a
fractional share, the fractional share will be rounded up to, and issued as, a
whole share.  If, pursuant to a Change of Control event, the shares
shall be exchanged solely for cash (in such case, a “Triggering Event”),
then the Company shall give the Holder written notice describing the material
terms and conditions of such impending transaction not later than ten (10) days
prior to the stockholders’ meeting called to approve such transaction (or such
longer period if required by the General Corporation Law of the State of
California), or ten (10) days prior to the closing of such transaction (or such
longer period if required by the General Corporation Law of the State of
California), whichever is earlier, and shall also notify the holder of this
Warrant of the final approval of such transaction.
  (b)           Reclassification,
etc.  If the Company at any time shall, by subdivision,
combination or reclassification of securities or otherwise, change any of the
securities to which purchase rights under this Warrant exist into the same or a
different number of securities of any class or classes, this Warrant shall
thereafter be to acquire such number and kind of securities as would have been
issuable as the result of such change with respect to the securities which were
subject to the purchase rights under this Warrant immediately prior to such
subdivision, combination, reclassification or other change.  If shares
of the Company’s Common Stock are subdivided or combined into a greater or
smaller number of shares of Common Stock, the purchase price under this Warrant
shall be proportionately reduced in case of subdivision of shares or
proportionately increased in the case of combination of shares and the number of
shares of Common Stock purchasable under this Warrant shall be proportionally
increased in the case of a subdivision and decreased in the case of combination,
in all cases by the ratio which the total number of shares of Common Stock to be
outstanding immediately after such event bears to the total number of shares of
Common Stock outstanding immediately prior to such event.
  18
  (c)           Cash
Distributions.  No adjustment on account of cash dividends or
interest on the Company’s Common Stock or other securities purchasable hereunder
will be made to the purchase price under this Warrant .
  (d)           Authorized
Shares.  The Company covenants that during the period the
Warrant is outstanding, it will reserve from its authorized and unissued Common
Stock a sufficient number of shares to provide for the issuance of Common Stock
upon the exercise of any purchase rights under this Warrant.  The
Company further covenants that its issuance of this Warrant shall constitute
full authority to its officers who are charged with the duty of executing stock
certificates to execute and issue the necessary certificates for shares of the
Company’s Common Stock upon the exercise of the purchase rights under this
Warrant.
  13.           Miscellaneous.
  (a)           Issue
Date.  The provisions of this Warrant shall be construed and
shall be given effect in all respect as if it had been issued and delivered by
the Company on the date hereof.  This Warrant shall be binding upon
any successors or assigns of the Company.  This Warrant shall
constitute a contract under the laws of the State of California and for all
purposes shall be construed in accordance with and governed by the laws of said
state.
  (b)           Restrictions.  The
holder hereof acknowledges that the Common Stock acquired upon the exercise of
this Warrant may have restrictions upon its resale imposed by state and federal
securities laws.
  (c)           Entire Agreement and
Amendments.  This Warrant constitutes the entire agreement of
the parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and the Holder
with respect to the subject matter hereof, and may not be modified adversely to
the Holder’s interest except by means of a writing signed by the Company and the
Holder.
  (d)           Notices.  Unless
otherwise provided, any notice required or permitted under this Warrant shall be
given in writing and shall be deemed effectively given as hereinafter described
(i) if given by personal delivery, then such notice shall be deemed given upon
such delivery, (ii) if given by telex, facsimile or e-mail, then such notice
shall be deemed given upon receipt of confirmation of complete transmittal,
(iii) if given by mail, then such notice shall be deemed given upon the earlier
of (A) receipt of such notice by the recipient or (B) three days after such
notice is deposited in first class mail, postage prepaid, and (iv) if given by
an internationally recognized overnight air courier, then such notice shall be
deemed given one business day after delivery to such carrier.  All
notices shall be addressed as follows: if to the Holder of the Warrant, at its
address as set forth in the Company’s books and records and, if to the Company,
at the address as follows, or at such other address as the Holder of the
Warrant, or the Company may designate by ten days’ advance written notice to the
other:
  19
  If to the
Company:
  Balqon
Corporation
 1701 E.
Edinger, Unit E-3
 Santa
Ana, California 92705
 If to
Holder:
  ________________________________
  ________________________________
  ________________________________
  (e)           Binding Agreement;
Assignment.  The terms and conditions of this Warrant shall
inure to the benefit of and be binding upon the respective successors and
permitted assigns of the parties.  Nothing in this Warrant, express or
implied, is intended to confer upon any third party any rights, remedies,
obligations, or liabilities under or by reason of this Warrant.  This
Warrant may not be assigned by Holder (other than to a Related Person) without
the prior written consent of the Company.  “Related Person” shall
mean with respect to any Holder (i) any affiliate of such person, (ii) any
investment fund, investment account or investment entity whose investment
manager, investment advisor or general partner, is such Holder or any affiliate
of such Holder or any member, partner, officer or employee of such Holder or any
affiliate of such Holder, (iii) any member or partner of any Holder specified in
clause (i) or (ii) above, and (iv) any officer or employee of any person
specified in clause (i), (ii) or (iii) above.
  (signature
page follows)
  20
  IN
WITNESS WHEREOF, BALQON CORPORATION has caused this Warrant to be executed by
its officers thereunto duly authorized.
  BALQON
      CORPORATIONDate
                  By:Balwinder
      Samra, President
  Name
      of Holder:
                Marlin Financial
      Group(Signature)Address:Telephone:Facsimile:
 21
  NOTICE OF
EXERCISE
  To:           BALQON
CORPORATION
  (1)           The
undersigned hereby elects to purchase ____________ shares of Common
Stock  of BALQON CORPORATION pursuant to the provisions of Section 3(a) of
the attached Warrant, and tenders herewith payment of the purchase price for
such shares in full.
  (2)           In
exercising this Warrant, the undersigned hereby confirms and acknowledges that
the shares of Common Stock to be issued upon exercise thereof are being acquired
solely for the account of the undersigned and not as a nominee for any other
party, and for investment, and that the undersigned will not offer, sell or
otherwise dispose of any such shares of Common Stock except under circumstances
that will not result in a violation of the Securities Act, or any applicable
state securities laws.
  (3)           In
exercising this Warrant, the undersigned hereby affirms that the representations
and warranties contained in Section 2 of
this Warrant are true and correct in all material respects.
  (4)           Please
issue a certificate or certificates representing said shares of Common Stock in
the name of the undersigned or in such other name as specified
below:
  NameName
  (5)           Please
issue a new Warrant for the unexercised portion of the attached Warrant in the
name of the undersigned or in such other name as is specified
below:
  Name(Date)
                  
                  
                  Signature
  22
  ASSIGNMENT
FORM
  FOR VALUE
RECEIVED, the undersigned registered owner of this Warrant hereby sells, assigns
and transfers unto the Assignee named below all of the rights of the undersigned
under the within Warrant, with respect to the number of shares of Common Stock
set forth below:
 Name
      of Assignee
              Address
              No.
      of Shares
  and does
hereby irrevocable constitute and appoint _______________________ Attorney to
make such transfer on the books of BALQON CORPORATION, maintained for the
purpose, with full power of substitution in the premises.
  The
undersigned also represents that, by assignment hereof, the Assignee
acknowledges that this Warrant and the shares of Common Stock to be issued upon
exercise hereof or conversion thereof are being acquired for investment and that
the Assignee will not offer, sell or otherwise dispose of this Warrant or any
shares of Common Stock to be issued upon exercise hereof or conversion thereof
except under circumstances which will not result in a violation of the
Securities Act or any state securities laws.  Further, the Assignee
has acknowledged that upon exercise of this Warrant, the Assignee shall, if
requested by the Company, confirm in writing, in a form satisfactory to the
Company, that the shares of Common Stock so purchased are being acquired for
investment and not with a view toward distribution or resale.
  Dated:
 Signature
      of Holder
 23
  NEITHER
THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON THE EXERCISE OF THESE
SECURITIES HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS.  THE SECURITIES
REPRESENTED HEREBY MAY NOT BE EXERCISED, OFFERED, SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE ASSIGNED (EACH A “TRANSFER”) EXCEPT (A)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSFER NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (B) TO THE EXTENT THE
TRANSFER DOES NOT CONSTITUTE AND WILL NOT RESULT IN A VIOLATION OF APPLICABLE
FEDERAL OR STATE SECURITIES LAWS, AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
THE TRANSFEROR TO SUCH EFFECT (TO THE EXTENT REQUESTED BY COUNSEL OF THE
COMPANY), THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY.  THE HOLDER HEREOF AGREES THAT IT WILL DELIVER, OR CAUSE TO
BE DELIVERED, TO EACH PERSON TO WHOM THE SECURITIES HEREBY REPRESENTED ARE
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND.  THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE OF
THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
SECURED BY SUCH SECURITIES.
  
 STOCK
PURCHASE WARRANT
 
 BALQON
CORPORATION
  
  Original
Issue Date: June 4, 2008
  THIS
CERTIFIES that, for value received, Marlin Financial Group (the “Holder”), is
entitled, upon the terms and subject to the conditions hereinafter set forth, to
subscribe for and purchase, from BALQON CORPORATION, a California corporation
(the “Company”), at any
time upon the terms and subject to the conditions set forth herein, from the
Company, 243,060 shares of common stock (“Common Stock”) of the
Company (the “Warrant
Shares”).  The exercise price of one share of Common Stock
under this Warrant shall be $2.50 (“Exercise Price”),
subject to adjustment as provided herein.  If the purchase rights
represented by this Warrant are not exercised before the close of business on
the day preceding June 30, 2012, this Warrant shall be void.
  1.           Title of
Warrant.  Prior to the expiration hereof and subject to
compliance with applicable laws, this Warrant and all rights hereunder are
transferable, in whole or in part, at the office or agency of the Company,
referred to in Section 3
hereof, by the holder hereof in person or by duly authorized attorney, upon
surrender of this Warrant together with the Assignment Form annexed hereto
properly endorsed.
  24
  2.           Investment
Representations.
  (a)           Holder
confirms that it has been given sufficient access to information regarding the
Company and in connection with its decision to receive this Warrant, including
any common stock issuable upon the exercise of this Warrant (collectively, the
“Securities”),
including the opportunity to ask questions of, and receive answers from, persons
acting on behalf of Company and concerning Company’s financial affairs,
prospects and condition.
  (b)           Holder
represents and warrants that (i) it is resident in or otherwise subject to the
securities legislation of the United States, and the issuance of the Securities
to Holder has occurred only in the United States; (ii) Holder, by reason of its
business or financial expertise, has the capacity to protect its own interests
in connection with its acquisition of the Securities; and (iii) Holder is an
“accredited investor” as defined in Rule 501 of Regulation D of the Securities
Act of 1933, as amended (the “Securities
Act”).
  (c)           Holder
represents, warrants and covenants that it shall acquire the Securities for its
own account and not for the account or on behalf of others, and it is doing so
with the intent of retaining such Securities as an investment and without the
current intent to redistribute such Securities.
  (d)           Holder
acknowledges that: (i) no securities commission or similar authority has
reviewed or passed on the merits of the Securities; (ii) there is no government
or other insurance covering such Securities; and (iii) there are risks
associated with the acquisition of the Securities.
  (e)           Holder
acknowledges that (i) it must and shall bear the economic risk of holding the
Securities, which may be for an indefinite period of time, because at the time
such Securities are issued they will not have been registered under the
Securities Act or any other securities law and, therefore, cannot be sold unless
they are subsequently registered under applicable federal and state securities
laws or an exemption from such registration is available; (ii) the Securities
may not be resold or transferred on the official stock transfer records of
Company without furnishing to Company an opinion of counsel reasonably
acceptable to Company that such sale or transfer of the Securities will not
violate the registration provisions of applicable federal and state securities
laws; and (iii) certificates representing the Securities shall have endorsed on
them a restrictive legend to this effect.
  (f)           Holder
acknowledges that Company is relying on the representations, warranties,
covenants and acknowledgments in this Section 2 to
ensure that the Securities can be issued in reliance on exemptions from
registration requirements under United States federal and state securities
laws.
  3.           Exercise of
Warrant.
  (a)           The
purchase rights represented by this Warrant are exercisable by the Holder by the
surrender of this Warrant and the Notice of Exercise annexed hereto duly
completed and executed on behalf of the Holder, at the office of the Company (or
such other office or agency of the Company as it may designate by notice in
writing to the Holder at the address of the Holder appearing on the books of the
Company), upon payment in cash, certified check or wire transfer of funds, of
the aggregate Exercise Price for that number of Warrant Shares then being
purchased.
  25
  (b)           This
Warrant shall be deemed to have been exercised immediately prior to the close of
business on the date of its surrender for exercise as provided above, and the
person entitled to receive the shares of Common Stock issuable upon such
exercise shall be treated for all purposes as the holder of record of such
shares as of the close of business on such date.  As promptly as
practicable on or after such date and in any event within ten (10) days
thereafter, the Company at its expense shall issue and deliver to the person or
persons entitled to receive the same a certificate or certificates for the
number of shares issuable upon such exercise.  In the event that this
Warrant is exercised in part, the Company at its expense will execute and
deliver a new Warrant of like tenor exercisable for the number of shares for
which this Warrant may then be exercised.  Each exercise hereof shall
constitute the reaffirmation by the holder hereof that the representations and
warranties contained in Section 2 of
this Warrant true and correct in all material respects with respect to the
Holder of the Warrant as of the time of such exercise.
  4.           No Fractional Shares or
Scrip.  No fractional shares or scrip representing fractional
shares shall be issued upon the exercise of this Warrant.  With
respect to any fraction of a share called for upon the exercise of this Warrant,
an amount equal to such fraction multiplied by the then current price at which
each share may be purchased hereunder shall be paid in cash to the holder of
this Warrant.
  5.           Charges, Taxes and
Expenses.  Issuance of certificates for shares of Common Stock
upon the exercise of this Warrant shall be made without charge to the holder
hereof for any issue or transfer tax or other incidental expense in respect of
the issuance of such certificate, all of which taxes and expenses shall be paid
by the Company, and such certificates shall be issued in the name of the holder
of this Warrant or in such name or names as may be directed by the holder of
this Warrant; provided, however, that in the event certificates for shares of
Common Stock are to be issued in a name other than the name of the holder of
this Warrant, this Warrant when surrendered for exercise shall be accompanied by
the Assignment Form attached hereto duly executed by the holder hereof; and
provided further, that upon any transfer involved in the issuance or delivery of
any certificates for shares of Common Stock, the Company may require, as a
condition thereto, the payment of a sum sufficient to reimburse it for any
transfer tax incidental thereto.  The Holder of the Warrant shall be
responsible for income taxes due under federal, state, or other law, if any, if
any such tax is due.
  6.           No Rights as
Stockholders.  This Warrant does not entitle the holder hereof
to any voting rights or other rights as a stockholder of the Company prior to
the exercise thereof.  Nothing in this Warrant shall be construed to
give any person, firm or corporation (other than the Company and the Holder of
this Warrant) 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 of this Warrant.
  7.           Exchange and Registry of
Warrant.  This Warrant is exchangeable, upon the surrender
hereof by the registered holder at the above-mentioned office or agency of the
Company, for a new Warrant of like tenor and dated as of such
exchange.  The Company shall maintain at the above-mentioned office or
agency a registry showing the name and address of the registered holder of this
Warrant.  This Warrant may be surrendered for exchange, transfer or
exercise, in accordance with its terms, at such office or agency of the Company,
and the Company shall be entitled to rely in all respects, prior to written
notice to the contrary, upon such registry.
  26
  8.           Loss, Theft, Destruction or
Mutilation of Warrant.  Upon receipt by the Company of evidence
reasonably satisfactory to it of the loss, theft, destruction or mutilation of
this Warrant, and in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to it, and upon reimbursement to the Company of
all reasonable expenses incidental thereto, and upon surrender and cancellation
of this Warrant, if mutilated, the Company will make and deliver a new Warrant
of like tenor and dated as of such cancellation, in lieu of this
Warrant.
  9.           Saturdays, Sundays,
Holidays, etc.  If the last or appointed day for the taking of
any action or the expiration of any right required or granted herein shall be a
Saturday or a Sunday or shall be a legal holiday, then such action may be taken
or such right may be exercised on the next succeeding day not a legal
holiday.
  10.           Transferability and
Nonnegotiability of Warrant.  This Warrant may not be
transferred or assigned in whole or in part without compliance with all
applicable federal and state securities laws by the transferor and the
transferee (including the delivery of investment representation letters and
legal opinions reasonably satisfactory to the Company, if such are requested by
the Company).  Subject to the provisions of this Warrant with respect
to compliance with the Securities Act, title to this Warrant may be transferred
by endorsement (by the Holder executing the Assignment Form annexed hereto) and
delivery in the same manner as a negotiable instrument transferable by
endorsement and delivery.
  11.           Compliance With Securities
Laws.
  (a)           The
Holder of this Warrant represents and warrants that this Warrant and the shares
of Common Stock to be issued upon exercise hereof are being acquired solely for
the Holder’s own account and not as a nominee for any other party, and for
investment, and that the Holder will not offer, sell or otherwise dispose of
this Warrant or any shares of Common Stock to be issued upon exercise hereof
except under circumstances that will not result in a violation of the Securities
Act or any state securities laws.  Upon exercise of this Warrant, the
Holder shall, if requested by the Company, confirm in writing, in a form
satisfactory to the Company, that the shares of Common Stock so purchased are
being acquired solely for the Holder’s own account and not as a nominee for any
other party, for investment, and not with a view toward distribution or
resale.
  (b)           This
Warrant and all shares of Common Stock issued upon exercise hereof shall be
stamped or imprinted with a legend in substantially the following form (in
addition to any legend required by state securities laws):
  27
  NEITHER
THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON THE EXERCISE OF THESE
SECURITIES HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS.  THE SECURITIES
REPRESENTED HEREBY MAY NOT BE EXERCISED, OFFERED, SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE ASSIGNED (EACH A “TRANSFER”) EXCEPT (A)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSFER NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (B) TO THE EXTENT THE
TRANSFER DOES NOT CONSTITUTE AND WILL NOT RESULT IN A VIOLATION OF APPLICABLE
FEDERAL OR STATE SECURITIES LAWS, AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
THE TRANSFEROR TO SUCH EFFECT (TO THE EXTENT REQUESTED BY COUNSEL OF THE
COMPANY), THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY.  THE HOLDER HEREOF AGREES THAT IT WILL DELIVER, OR CAUSE TO
BE DELIVERED, TO EACH PERSON TO WHOM THE SECURITIES HEREBY REPRESENTED ARE
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND.  THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE OF
THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
SECURED BY SUCH SECURITIES.
  12.           Early Termination and
Reclassification.
  (a)           Merger, Sale of Assets,
etc.  If all or any portion of this Warrant is exercised
subsequent to a merger, consolidation, exchange of shares, reorganization, or
other similar event (“Change in Control”)
occurring after the date hereof, as a result of which shares shall be changed
into cash, other property, or the same or a different number of shares of the
same or another class or classes of securities of the Company or another entity,
the Holder exercising this Warrant shall receive, for the exercise price, the
aggregate amount of cash or other property and the aggregate number of shares
and class of securities which the Holder would have received if this Warrant was
exercised immediately before the Change in Control.  If an adjustment
under this section would create a fractional share or a right to acquire a
fractional share, the fractional share will be rounded up to, and issued as, a
whole share.  If, pursuant to a Change of Control event, the shares
shall be exchanged solely for cash (in such case, a “Triggering Event”),
then the Company shall give the Holder written notice describing the material
terms and conditions of such impending transaction not later than ten (10) days
prior to the stockholders’ meeting called to approve such transaction (or such
longer period if required by the General Corporation Law of the State of
California), or ten (10) days prior to the closing of such transaction (or such
longer period if required by the General Corporation Law of the State of
California), whichever is earlier, and shall also notify the holder of this
Warrant of the final approval of such transaction.
  (b)           Reclassification,
etc.  If the Company at any time shall, by subdivision,
combination or reclassification of securities or otherwise, change any of the
securities to which purchase rights under this Warrant exist into the same or a
different number of securities of any class or classes, this Warrant shall
thereafter be to acquire such number and kind of securities as would have been
issuable as the result of such change with respect to the securities which were
subject to the purchase rights under this Warrant immediately prior to such
subdivision, combination, reclassification or other change.  If shares
of the Company’s Common Stock are subdivided or combined into a greater or
smaller number of shares of Common Stock, the purchase price under this Warrant
shall be proportionately reduced in case of subdivision of shares or
proportionately increased in the case of combination of shares and the number of
shares of Common Stock purchasable under this Warrant shall be proportionally
increased in the case of a subdivision and decreased in the case of combination,
in all cases by the ratio which the total number of shares of Common Stock to be
outstanding immediately after such event bears to the total number of shares of
Common Stock outstanding immediately prior to such event.
  28
  (c)           Cash
Distributions.  No adjustment on account of cash dividends or
interest on the Company’s Common Stock or other securities purchasable hereunder
will be made to the purchase price under this Warrant .
  (d)           Authorized
Shares.  The Company covenants that during the period the
Warrant is outstanding, it will reserve from its authorized and unissued Common
Stock a sufficient number of shares to provide for the issuance of Common Stock
upon the exercise of any purchase rights under this Warrant.  The
Company further covenants that its issuance of this Warrant shall constitute
full authority to its officers who are charged with the duty of executing stock
certificates to execute and issue the necessary certificates for shares of the
Company’s Common Stock upon the exercise of the purchase rights under this
Warrant.
  13.           Miscellaneous.
  (a)           Issue
Date.  The provisions of this Warrant shall be construed and
shall be given effect in all respect as if it had been issued and delivered by
the Company on the date hereof.  This Warrant shall be binding upon
any successors or assigns of the Company.  This Warrant shall
constitute a contract under the laws of the State of California and for all
purposes shall be construed in accordance with and governed by the laws of said
state.
  (b)           Restrictions.  The
holder hereof acknowledges that the Common Stock acquired upon the exercise of
this Warrant may have restrictions upon its resale imposed by state and federal
securities laws.
  (c)           Entire Agreement and
Amendments.  This Warrant constitutes the entire agreement of
the parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and the Holder
with respect to the subject matter hereof, and may not be modified adversely to
the Holder’s interest except by means of a writing signed by the Company and the
Holder.
  (d)           Notices.  Unless
otherwise provided, any notice required or permitted under this Warrant shall be
given in writing and shall be deemed effectively given as hereinafter described
(i) if given by personal delivery, then such notice shall be deemed given upon
such delivery, (ii) if given by telex, facsimile or e-mail, then such notice
shall be deemed given upon receipt of confirmation of complete transmittal,
(iii) if given by mail, then such notice shall be deemed given upon the earlier
of (A) receipt of such notice by the recipient or (B) three days after such
notice is deposited in first class mail, postage prepaid, and (iv) if given by
an internationally recognized overnight air courier, then such notice shall be
deemed given one business day after delivery to such carrier.  All
notices shall be addressed as follows: if to the Holder of the Warrant, at its
address as set forth in the Company’s books and records and, if to the Company,
at the address as follows, or at such other address as the Holder of the
Warrant, or the Company may designate by ten days’ advance written notice to the
other:
  29
  If to the
Company:
  Balqon
Corporation
 1701 E.
Edinger, Unit E-3
 Santa
Ana, California 92705
 If to
Holder:
  ________________________________
  ________________________________
  ________________________________
  (e)           Binding Agreement;
Assignment.  The terms and conditions of this Warrant shall
inure to the benefit of and be binding upon the respective successors and
permitted assigns of the parties.  Nothing in this Warrant, express or
implied, is intended to confer upon any third party any rights, remedies,
obligations, or liabilities under or by reason of this Warrant.  This
Warrant may not be assigned by Holder (other than to a Related Person) without
the prior written consent of the Company.  “Related Person” shall
mean with respect to any Holder (i) any affiliate of such person, (ii) any
investment fund, investment account or investment entity whose investment
manager, investment advisor or general partner, is such Holder or any affiliate
of such Holder or any member, partner, officer or employee of such Holder or any
affiliate of such Holder, (iii) any member or partner of any Holder specified in
clause (i) or (ii) above, and (iv) any officer or employee of any person
specified in clause (i), (ii) or (iii) above.
  (signature
page follows)
  30
  IN
WITNESS WHEREOF, BALQON CORPORATION has caused this Warrant to be executed by
its officers thereunto duly authorized.
  BALQON
      CORPORATIONDate
                    By:Balwinder
      Samra, President
  Name
      of Holder:
                  Marlin Financial
      Group(Signature)Address:Telephone:Facsimile:
  31
  NOTICE OF
EXERCISE
  To:           BALQON
CORPORATION
  (1)           The
undersigned hereby elects to purchase ____________ shares of Common
Stock  of BALQON CORPORATION pursuant to the provisions of Section 3(a) of
the attached Warrant, and tenders herewith payment of the purchase price for
such shares in full.
  (2)           In
exercising this Warrant, the undersigned hereby confirms and acknowledges that
the shares of Common Stock to be issued upon exercise thereof are being acquired
solely for the account of the undersigned and not as a nominee for any other
party, and for investment, and that the undersigned will not offer, sell or
otherwise dispose of any such shares of Common Stock except under circumstances
that will not result in a violation of the Securities Act, or any applicable
state securities laws.
  (3)           In
exercising this Warrant, the undersigned hereby affirms that the representations
and warranties contained in Section 2 of
this Warrant are true and correct in all material respects.
  (4)           Please
issue a certificate or certificates representing said shares of Common Stock in
the name of the undersigned or in such other name as specified
below:
  NameName
  (5)           Please
issue a new Warrant for the unexercised portion of the attached Warrant in the
name of the undersigned or in such other name as is specified
below:
  Name(Date)
                  
                  
                  Signature
  32
  ASSIGNMENT
FORM
  FOR VALUE
RECEIVED, the undersigned registered owner of this Warrant hereby sells, assigns
and transfers unto the Assignee named below all of the rights of the undersigned
under the within Warrant, with respect to the number of shares of Common Stock
set forth below:
 Name
      of Assignee
              Address
              No.
      of Shares
  and does
hereby irrevocable constitute and appoint _______________________ Attorney to
make such transfer on the books of BALQON CORPORATION, maintained for the
purpose, with full power of substitution in the premises.
  The
undersigned also represents that, by assignment hereof, the Assignee
acknowledges that this Warrant and the shares of Common Stock to be issued upon
exercise hereof or conversion thereof are being acquired for investment and that
the Assignee will not offer, sell or otherwise dispose of this Warrant or any
shares of Common Stock to be issued upon exercise hereof or conversion thereof
except under circumstances which will not result in a violation of the
Securities Act or any state securities laws.  Further, the Assignee
has acknowledged that upon exercise of this Warrant, the Assignee shall, if
requested by the Company, confirm in writing, in a form satisfactory to the
Company, that the shares of Common Stock so purchased are being acquired for
investment and not with a view toward distribution or resale.
  Dated:
 Signature
      of Holder