Document:

Form of Representative's Warrant

 Exhibit 4.6 
  

FORM OF 
  
 THIS WARRANT HAS NOT BEEN REGISTERED 
 UNDER THE SECURITIES ACT OF 1933 
 AND IS NOT TRANSFERABLE 
 EXCEPT AS PROVIDED
HEREIN 
  
 DayStar Technologies, Inc. 
  
 PURCHASE WARRANT 
  
 Issued to: 
  
 PAULSON INVESTMENT COMPANY, INC. 
  
 Exercisable to Purchase 
  
 210,000 Units 
  
 of 
  
 DAYSTAR TECHNOLOGIES, INC. 
  
  
 Void after                     , 2009

 This is to certify that, for value received and subject to the terms and conditions set forth below, the
Warrantholder (hereinafter defined) is entitled to purchase, and the Company promises and agrees to sell and issue to the Warrantholder, at any time on or after             , 2005
and on or before             , 2009, up to 210,000 Units (hereinafter defined) at the Exercise Price (hereinafter defined). 
  
 This Warrant Certificate is issued subject to the following terms and
conditions: 
  
 1. Definitions of Certain Terms. Except as
may be otherwise clearly required by the context, the following terms have the following meanings: 
  
 (a) “Act” means the Securities Act of 1933, as amended. 
  
 (b) “Cashless Exercise” means an exercise of Warrants in which, in lieu of payment of the Exercise
Price, the Holder elects to receive a lesser number of Securities such that the value of the Securities that such Holder would otherwise have been entitled to receive but has agreed not to receive, as determined by the closing price of such
Securities on the date of exercise or, if such date is not a trading day, on the next prior trading day, is equal to the Exercise Price with respect to such exercise. A Holder may only elect a Cashless Exercise if Securities issuable by the Company
on such exercise are publicly traded securities. 
  
 (c) “Closing Date” means the date on which the Offering is closed. 
  
 (d) “Commission” means the Securities and Exchange Commission. 
  
 (e) “Common Stock” means the common stock, par value $0.01, of the Company. 
  
 (f) “Company” means DayStar Technologies, Inc., a
Delaware corporation. 
  
 (g)
“Company’s Expenses” means any and all expenses payable by the Company or the Warrantholder in connection with an offering described in Section 6 hereof, except Warrantholder’s Expenses. 
  
 (h) “Effective Date” means the date on which the
Registration Statement is declared effective by the Commission. 
  
 (i) “Exercise Price” means the price at which the Warrantholder may purchase one Unit upon exercise of Warrants as determined from time to time pursuant to the provisions hereof. The initial Exercise Price
is $             per Unit. 
  
 (j) “Offering” means the public offering of Units made pursuant to the Registration Statement. 
  
 (k) “Participating Underwriter” means any
underwriter participating in the sale of the Securities pursuant to a registration under Section 6 of this Warrant Certificate. 

 (l) “Registration Statement” means the Company’s registration statement
(File No. 333 -110337) as amended on the Closing Date. 
  
 (m) “Rules and Regulations” means the rules and regulations of the Commission adopted under the Act. 
  
 (n) “Securities” means the securities obtained or obtainable upon exercise of the Warrant or securities obtained or obtainable
upon exercise, exchange, or conversion of such securities. 
  
 (o) “Unit” means one share of Common Stock, one Class A Warrant and one Class B Warrant, where the Class A Warrant and Class B Warrant are issued pursuant to the Warrant Agreement. 
  
 (p) “Unit Warrants” means the Class A Warrants and
Class B Warrants. 
  
 (q) “Warrant
Agreement” means that certain Warrant Agreement, dated as of             , 2004, by and between the Company and
             relating to the issuance of Unit Warrants. 
  
 (r) “Warrant Certificate” means a certificate evidencing the Warrant. 
  
 (s) “Warrantholder” means a record holder of the
Warrant or Securities. The initial Warrantholder is Paulson Investment Company, Inc. 
  
 (t) “Warrantholder’s Expenses” means the sum of (i) the aggregate amount of cash payments made to an underwriter,
underwriting syndicate, or agent in connection with an offering described in Section 6 hereof multiplied by a fraction the numerator of which is the aggregate sales price of the Securities sold by such underwriter, underwriting syndicate, or agent
in such offering and the denominator of which is the aggregate sales price of all of the securities sold by such underwriter, underwriting syndicate, or agent in such offering and (ii) all out-of-pocket expenses of the Warrantholder, except for the
fees and disbursements of one firm retained as legal counsel for the Warrantholder that will be paid by the Company. 
  
 (u) “Warrant” means the warrant evidenced by this certificate, any similar certificate issued in connection with the Offering,
or any certificate obtained upon transfer or partial exercise of the Warrant evidenced by any such certificate. 
  
 2. Exercise of Warrant. All or any part of the Warrant represented by this Warrant Certificate may be exercised commencing on the first anniversary
of the Effective Date and ending at 5 p.m. Pacific Time on the fifth anniversary of the Effective Date by surrendering this Warrant Certificate, together with appropriate instructions, duly executed by the Warrantholder or by its duly authorized
attorney, at the office of the Company at DayStar Technologies, Inc., 900 Golden Gate Terrace, Suite A, Grass Valley, California 95945, Attention: President; or at such other office or agency as the Company may designate. The date on which such
instructions are received by the Company shall be the date of exercise. If the Holder has elected a Cashless Exercise, such instructions shall so state. Upon receipt of notice of exercise, the Company shall immediately instruct its transfer agent to
prepare certificates for the Securities to be received by 

 the Warrantholder upon completion of the Warrant exercise. When such certificates are prepared, the Company shall notify
the Warrantholder and deliver such certificates to the Warrantholder or as per the Warrantholder’s instructions immediately upon payment in full by the Warrantholder, in lawful money of the United States, of the Exercise Price payable with
respect to the Securities being purchased, if any. If the Warrantholder shall represent and warrant that all applicable registration and prospectus delivery requirements for their sale have been complied with upon sale of the Securities received
upon exercise of the Warrant, such certificates shall not bear a legend with respect to the Securities Act of 1933, as amended. 
  
 If fewer than all the Securities purchasable under the Warrant are purchased, the Company will, upon such partial exercise, execute and deliver to the
Warrantholder a new Warrant Certificate (dated the date hereof), in form and tenor similar to this Warrant Certificate, evidencing that portion of the Warrant not exercised. The Securities to be obtained on exercise of the Warrant will be deemed to
have been issued, and any person exercising the Warrants will be deemed to have become a holder of record of those Securities, as of the date of the payment of the Exercise Price. 
  
 3. Adjustments in Certain Events. The number, class, and price of Securities for which this Warrant Certificate may
be exercised are subject to adjustment from time to time upon the happening of certain events as follows: 
  
 (a) If the outstanding shares of the Company’s Common Stock are divided into a greater number of shares or a dividend in stock is
paid on the Common Stock, the number of shares of Common Stock for which the Warrant is then exercisable will be proportionately increased and the Exercise Price will be proportionately reduced; and, conversely, if the outstanding shares of Common
Stock are combined into a smaller number of shares of Common Stock, the number of shares of Common Stock for which the Warrant is then exercisable will be proportionately reduced and the Exercise Price will be proportionately increased. The
increases and reductions provided for in this Section 3(a) will be made with the intent and, as nearly as practicable, the effect that neither the percentage of the total equity of the Company obtainable on exercise of the Warrants nor the price
payable for such percentage upon such exercise will be affected by any event described in this Section 3(a). 
  
 (b) In case of any change in the Common Stock through merger, consolidation, reclassification, reorganization, partial or complete
liquidation, purchase of substantially all the assets of the Company, or other change in the capital structure of the Company, then, as a condition of such change, lawful and adequate provision will be made so that the holder of this Warrant
Certificate will have the right thereafter to receive upon the exercise of the Warrant the kind and amount of shares of stock or other securities or property to which he would have been entitled if, immediately prior to such event, he had held the
number of shares of Common Stock obtainable upon the exercise of the Warrant. In any such case, appropriate adjustment will be made in the application of the provisions set forth herein with respect to the rights and interest thereafter of the
Warrantholder, to the end that the provisions set forth herein will thereafter be applicable, as nearly as reasonably may be, in relation to any shares of stock or other property thereafter deliverable upon the exercise of the Warrant. The Company
will not permit any change in its capital structure to occur unless the issuer of the 

 shares of stock or other securities to be received by the holder of this Warrant Certificate, if not the
Company, agrees to be bound by and comply with the provisions of this Warrant Certificate. 
  
 (c) When any adjustment is required to be made in the number of shares of Common Stock, other securities, or the property purchasable upon
exercise of the Warrant, the Company will promptly determine the new number of such shares or other securities or property purchasable upon exercise of the Warrant and (i) prepare and retain on file a statement describing in reasonable detail the
method used in arriving at the new number of such shares or other securities or property purchasable upon exercise of the Warrant and (ii) cause a copy of such statement to be mailed to the Warrantholder within thirty (30) days after the date of the
event giving rise to the adjustment. 
  
 (d) No
fractional shares of Common Stock or other securities will be issued in connection with the exercise of the Warrant, but the Company will pay, in lieu of fractional shares, a cash payment therefor on the basis of the mean between the bid and asked
prices of the Common Stock in the over-the-counter market or the last sale price of the Common Stock on the principal exchange or other trading facility on which the Common Stock is traded on the day immediately prior to exercise. 
  
 (e) If securities of the Company or securities of any
subsidiary of the Company are distributed pro rata to holders of Common Stock, such number of securities will be distributed to the Warrantholder or its assignee upon exercise of its rights hereunder as such Warrantholder or assignee would have been
entitled to if this Warrant Certificate had been exercised prior to the record date for such distribution. The provisions with respect to adjustment of the Common Stock provided in this Section 3 will also apply to the securities to which the
Warrantholder or its assignee is entitled under this Section 3(e). 
  
 (f) Notwithstanding anything herein to the contrary, there will be no adjustment made hereunder on account of the sale by the Company of the Common Stock or other Securities purchasable upon exercise of the Warrant.

  
 (g) If, immediately prior to any exercise of
Warrants, there shall be outstanding no securities of a class or series that, but for the provisions of this Section 3, would be issuable upon such exercise (the “Formerly Issuable Securities”), then, upon such exercise, and in lieu
of the Formerly Issuable Securities, the Company shall issue that number and kind of other securities or property for which the Formerly Issuable Securities were most recently exercisable or into which the Formerly Issuable Securities were most
recently convertible, as the case may be. 
  
 4. Reservation of
Securities. The Company agrees that the number of shares of Common Stock or other Securities sufficient to provide for the exercise of the Warrant upon the basis set forth above will at all times during the term of the Warrant be reserved for
exercise. 
  
 5. Validity of Securities. All Securities
delivered upon the exercise of the Warrant will be duly and validly issued in accordance with their terms, and the Company will pay all documentary and transfer taxes, if any, in respect of the original issuance thereof upon exercise of the Warrant.

 6. Registration of Securities Issuable on Exercise of Warrant Certificate. 
  
 (a) The Company will register the Securities on Form S-3 or
any successor form with the Commission pursuant to the Act so as to allow the unrestricted sale of the Securities to the public from time to time commencing on the first anniversary of the Effective Date and ending at 5:00 p.m. Pacific Time on the
fifth anniversary of the Effective Date (the “Registration Period”). The Company will also file such applications and other documents necessary to permit the sale of the Securities to the public during the Registration Period in
those states in which the Warrantholders reside or such other states as to which the Company and the Warrantholder agree. In order to comply with the provisions of this Section 6(a), the Company is not required to file more than one registration
statement. No registration right of any kind, “piggyback” or otherwise, will last longer than five years from the Effective Date. 
  
 (b) The Company will pay all of the Company’s Expenses and each Warrantholder will pay its pro rata share of the Warrantholder’s
Expenses relating to the registration, offer, and sale of the Securities. 
  
 (c) Except as specifically provided herein, the manner and conduct of the registration, including the contents of the registration, will be entirely in the control and at the discretion of the Company. The Company
will file such post-effective amendments and supplements as may be necessary to maintain the currency of the registration statement during the period of its use. In addition, if the Warrantholder participating in the registration is advised by
counsel that the registration statement, in their opinion, is deficient in any material respect, the Company will use its best efforts to cause the registration statement to be amended to eliminate the concerns raised. 
  
 (d) The Company will furnish to the Warrantholder the number
of copies of a prospectus, including a preliminary prospectus, in conformity with the requirements of the Act, and such other documents as it may reasonably request in order to facilitate the disposition of Securities owned by it. 
  
 (e) The Company will, at the request of Warrantholders
holding at least 50 percent of the then outstanding Warrants, (i) furnish an opinion of the counsel representing the Company for the purposes of the registration pursuant to this Section 6, addressed to the Warrantholders and any Participating
Underwriter, (ii) furnish an appropriate letter from the independent public accountants of the Company, addressed to the Warrantholders and anyParticipating Underwriter, and (iii) make representations and warranties to the Warrantholders and any
Participating Underwriter. A request pursuant to this subsection (e) may be made on three occasions. The documents required to be delivered pursuant to this subsection (e) will be dated within ten days of the request and will be, in form and
substance, equivalent to similar documents furnished to the underwriters in connection with the Offering, with such changes as may be appropriate in light of changed circumstances. 
  
 7. Indemnification in Connection with Registration. 
  
 (a) If any of the Securities are registered, the Company will indemnify and hold harmless each selling
Warrantholder, any person who controls any selling Warrantholder 

 within the meaning of the Act, and any Participating Underwriter against any losses, claims, damages, or
liabilities, joint or several, to which any Warrantholder, controlling person, or Participating Underwriter may be subject under the Act or otherwise; and it will reimburse each Warrantholder, each controlling person, and each Participating
Underwriter for any legal or other expenses reasonably incurred by the Warrantholder, controlling person, or Participating Underwriter in connection with investigating or defending any such loss, claim, damage, liability, or action, insofar as such
losses, claims, damages, or liabilities, joint or several (or actions in respect thereof), arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained, on the effective date thereof, in any such
registration statement or any preliminary prospectus or final prospectus, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading; provided, however, that the Company will not be liable in any case to the extent that any loss, claim, damage, or liability arises out of or is based upon any untrue statement or alleged
untrue statement or omission or alleged omission made in any registration statement, preliminary prospectus, final prospectus, or any amendment or supplement thereto, in reliance upon and in conformity with written information furnished by a
Warrantholder for use in the preparation thereof. The indemnity agreement contained in this subparagraph (a) will not apply to amounts paid to any claimant in settlement of any suit or claim unless such payment is first approved by the Company, such
approval not to be unreasonably withheld. 
  
 (b)
Each selling Warrantholder, as a condition of the Company’s registration obligation, will indemnify and hold harmless the Company, each of its directors, each of its officers who have signed any registration statement or other filing or any
amendment or supplement thereto, and any person who controls the Company within the meaning of the Act, against any losses, claims, damages, or liabilities to which the Company or any such director, officer, or controlling person may become subject
under the Act or otherwise, and will reimburse any legal or other expenses reasonably incurred by the Company or any such director, officer, or controlling person in connection with investigating or defending any such loss, claim, damage, liability,
or action, insofar as such losses, claims, damages, or liabilities (or actions in respect thereof) arise out of or are based upon any untrue or alleged untrue statement of any material fact contained in said registration statement, any preliminary
or final prospectus, or other filing, or any amendment or supplement thereto, or arise out of or are based upon the omission or the alleged omission to state therein a material fact required to be stated therein or necessary to make the statements
therein not misleading, but only to the extent that such untrue statement or alleged untrue statement or omission or alleged omission was made in said registration statement, preliminary or final prospectus, or other filing, or amendment or
supplement, in reliance upon and in conformity with written information furnished by such Warrantholder for use in the preparation thereof; provided, however, that the indemnity agreement contained in this subparagraph (b) will not apply to amounts
paid to any claimant in settlement of any suit or claim unless such payment is first approved by the Warrantholder, such approval not to be unreasonably withheld. 
  
 (c) Promptly after receipt by an indemnified party under subparagraphs (a) or (b) above of notice of the
commencement of any action, such indemnified party will, if a claim in respect thereof is to be made against an indemnifying party, notify the indemnifying party of the commencement thereof; but the omission to notify the indemnifying party will not
relieve it 

 from any liability that it may have to any indemnified party otherwise than under subparagraphs (a) and
(b). 
  
 (d) If any such action is brought
against any indemnified party and it notifies an indemnifying party of the commencement thereof, the indemnifying party will be entitled to participate in, and, to the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel satisfactory to such indemnified party; and after notice from the indemnifying party to such indemnified party of its election to assume the defense thereof, the indemnifying party will not be
liable to such indemnified party for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof other than reasonable costs of investigation. 
  
 8. Restrictions on Transfer. This Warrant Certificate and the Warrant
may not be sold, transferred, assigned or hypothecated for a one-year period after the Effective Date except to underwriters of the Offering or to individuals who are either a partner or an officer of such an underwriter or by will or by operation
of law. The Warrant may be divided or combined, upon request to the Company by the Warrantholder, into a certificate or certificates evidencing the same aggregate number of Warrants. 
  
 9. No Rights as a Shareholder. Except as otherwise provided herein, the Warrantholder will not, by virtue of
ownership of the Warrant, be entitled to any rights of a shareholder of the Company but will, upon written request to the Company, be entitled to receive such quarterly or annual reports as the Company distributes to its shareholders. 
  
 10. Notice. Any notices required or permitted to be given hereunder
will be in writing and may be served personally or by mail; and if served will be addressed as follows: 
  
 If to the Company: 
  
 DayStar Technologies, Inc. 
 900 Golden Gate
Terrace, Suite A 
 Grass Valley, California 95945 
 Attention: President 
  
 If to the
Warrantholder: 
  
 At the address furnished 
 by the Warrantholder to the 
 Company for the purpose of 
 notice. 
  
 Any notice so given by mail will be deemed effectively given 48 hours after mailing when deposited in the United States
mail, registered or certified mail, return receipt requested, postage prepaid and addressed as specified above. Any party may by written notice to the other specify a different address for notice purposes. 

 11. Applicable Law. This Warrant Certificate will be governed by and construed in accordance with
the laws of the State of Oregon, without reference to conflict of laws principles thereunder. All disputes relating to this Warrant Certificate shall be tried before the courts of Oregon located in Multnomah County, Oregon to the exclusion of all
other courts that might have jurisdiction. 
  
 Dated as of
                    , 2004 
  

	DAYSTAR TECHNOLOGIES, INC.
		
	By:	 	 
	 	

	 	 	Name:
	 	 	Title:

  
  
 Agreed and Accepted as of                     ,
2004 
  

	PAULSON INVESTMENT COMPANY, INC.
		
	By:	 	 
	 	

	 	 	Name:
	 	 	Title:Loan Agreement between the Registrant and Paulson Investment Company, Inc.

 EXHIBIT 10.13 
  
 LOAN AGREEMENT 
  
 This agreement is dated December 29, 2003 and is by and between Paulson Investment Company, Inc., a Oregon corporation (“Lender”) and DayStar Technologies,
Inc., a California corporation (“Borrower”). 
  
 Lender has agreed to
act as managing underwriter of an initial public offering of units of Borrower (the “Offering”). In order to provide additional cash to Borrower pending its receipt of the proceeds of the Offering, Lender has agreed to make loans to
Borrower as further described below. 
  
 NOW,
THEREORE, THE PARTIES AGREE AS FOLLOWS: 
  
 1. LOANS. At any time after December
24, 2003, Borrower may request loans (“Loans”) from Lender. The aggregate amount of such Loans cannot exceed $200,000. If at any time, the Offering is no longer being actively pursued, Lender shall not be obligated to make any further
Loans. Any Loan request shall be in a minimum amount of the smaller of $25,000 or the maximum amount that Borrower may then borrow as provided in this Section 1. 
  
 2. INTEREST. Interest shall accrue on the outstanding principal amount of all Loans at the rate of 6% per annum, calculated on the basis of
a 360 day year. 
  
 3. REPAYMENT FROM OFFERING PROCEEDS. Borrower shall repay all
of the outstanding principal of, and all accrued interest on, the Loans at the closing of the Offering. 
  
 4. PROVISIONS APPLICABLE IF OFFERING IS NOT CONSUMMATED. If the Offering is not consummated on or before June 30, 2004; 
  

	 	(a)	the Loans shall be repayable in six equal quarterly installments on the last day of each calendar quarter, beginning September 30, 2004; and 

	 	(b)	the principal and accrued interest on the Loans may, at any time after June 30, 2004 at the option of the Lender, be converted into common stock of Borrower in an amount equal to
7.5 percent of Borrower’s fully diluted common stock on the date of conversion. 

  
 4. PREPAYMENT. The principal of, and accrued interest on, the Loans is repayable at any time at the option of Borrower, in whole or in part, provided, however, that, in the case of any prepayment after December 24,
2003, Borrower shall give Lender ten business days prior notice of any such prepayment. Any partial prepayment shall be applied first to interest and thereafter to a reduction of principal. 
  

 PAGE 1 

 5. MISCELLANEOUS. 
  
 (a) Notice. Any notice permitted or required hereby shall be deemed validly given if (i) sent by registered mail, return receipt requested, or by a
recognized package delivery company that maintains a record of deliveries, or (ii) received at the address of the person to whom such notice is directed by any physical or electronic means. Any notice to Borrower shall be addressed to Borrower at:

  
 900 Golden Gate Terrace, Suite A 
 Grass Valley, CA 95945 
 Telephone:
530-271-5557 
  
 Or at any fax or e-mail address maintained by Borrower for
general corporate purposes. Any notice to Lender shall be addressed to Lender at: 
  
 811 SW Naito Parkway 
 Portland, OR 97204 
 Telephone: 503-243-6000 
 Fax: 503-243-6091

  
 Or at any fax or e-mail address maintained by Borrower for general corporate
purposes. 
  
 Any party may change addresses at which it wishes to receive notice
by valid notice to the other parties setting forth the new address. 
  
 (a) Governing Law. This Agreement shall be governed by and interpreted under the laws of the State of Oregon, excluding provisions thereof relating to conflict of laws. 
  
 (b) Collection. If any due and unpaid principal of or interest on any Loan is referred for collection, or if legal
action is instituted to collect any such amount, the costs reasonably incurred by Lender in connection with any such collection process shall be paid by Borrower. 
  

	DayStar Technologies, Inc.
		
	By:	 	 /s/    STEPHEN AANDERUD
      

	 	

	Title:	 	 Chief Financial Officer

  

	 Paulson Investment Company, Inc.

		
	By:	 	 /s/    LORRAINE MAXFIELD
      

	 	

	Title:	 	 Senior VP, Corp. Fin.

  

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