Document:

Unassociated Document

    EXHIBIT
4.19

     

    FORM
OF CONVERTIBLE NOTE

    

    THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR APPLICABLE STATE
SECURITIES LAWS, AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO
AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER THE SECURITIES ACT
AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN OPINION OF COUNSEL
REASONABLY SATISFACTORY TO THE COMPANY THAT THERE IS AN AVAILABLE EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.

     

    
      	
              Amount:
      $XX,XXX.XX

            	
              La
      Mirada, California

            
	 
      	
              Date:
      _____________, 2010

            

    

     

    FOR VALUE
RECEIVED, BIOLARGO,
INC., a corporation organized under the laws of the state of Delaware
(“Issuer”),
promises to pay to the order of ___XXXX____ (hereafter, together with any
subsequent holder hereof, called “Holder”), at its
office, at “Holder’s Address” (as that term is defined below), or at such other
place as Holder may direct, the “Amount” noted above (the “Loan Amount”),
payable on April 15, 2013, or at an earlier date as provided herein (the “Maturity Date”). This
convertible note is duly authorized issue of the Issuer, issued on the “Date”
noted (the “Issuance
Date”), and designated as its Convertible Note due April 15, 2013 (the
“Note”).

     

    The
Issuer agrees to pay interest on the unpaid principal amount of the Loan Amount
from time to time outstanding hereunder at the following rates per year,
compounded annually: (i) before maturity of the Loan Amount, whether by
acceleration or otherwise, at the rate per annum equal to ten percent (10%);
(ii) after the maturity of the Loan Amount, whether by acceleration or
otherwise, until paid, at a rate per annum equal to fifteen percent
(15%).

     

    Payments
of both principal and interest are to be made in immediately available funds in
lawful money of the United States of America, or in Common Stock of the Issuer
as set forth below.

    

    Accrual
of interest shall commence as of the Issuance Date. Interest will accrue monthly
and be paid annually on the Note on June 1st (pro-rated based on the actual
number of days elapsed in a 365-day year), such interest to be paid, at the
Company’s option, in cash or in that number of shares of Common Stock of the
Issuer (the “Common
Stock”) at a price per share equal to the average closing price of the
Company’s common stock for the 20 business days preceding a given interest due
date. Unless otherwise agreed in writing by both parties hereto, the interest so
payable will be paid to the person in whose name this Note (or one or more
predecessor Notes) is registered on the records of the Issuer regarding
registration and transfers of the Note (the “Note Register”),
provided, however, that the Issuer’s obligation to a transferee of this Note
arises only if such transfer, sale or other disposition is made in accordance
with the terms and conditions contained in this Note and the Subscription
Agreement (the “Agreement”) that the
Holder executed at the time of making an investment in the Issuer.

     

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

    

    The Note
is subject to the following additional provisions:

    

    1.           The
Issuer shall be entitled to withhold from all payments of principal and/or
interest of this Note any amounts required to be withheld under the applicable
provisions of the Internal Revenue Code of 1986, as amended, or other applicable
laws at the time of such payments.

     

    2.           This
Note has been issued subject to investment representations of the original
Holder hereof and may be transferred or exchanged only in compliance with the
Securities Act and applicable state securities laws and in compliance with the
restrictions on transfer provided in the  Agreement. Prior to the due
presentment for such transfer of this Note, the Issuer and any agent of the
Issuer may treat the person in whose name this Note is duly registered in the
Note Register as the owner hereof for the purpose of receiving payment as herein
provided and all other purposes, whether or not this Note is overdue, and
neither the Issuer nor any such agent shall be affected by notice to the
contrary. The transferee shall be bound, as the original Holder by the same
representations and terms described herein and under the Agreement.

     

    3.           The
Holder may, at its option, at any time convert the principal amount of this Note
or any portion thereof, and any accrued and unpaid interest thereon, into such
number of shares of fully paid and non-assessable Common Stock of the Issuer
(“Conversion
Shares”) as is obtained by dividing the Loan Amount by $0.575 (“Conversion Price”).
The right to convert the Note may be exercised by the Issuer by telecopying,
mailing (via first class mail, postage prepaid) or personally delivering an
executed and completed notice of conversion (the “Notice of Voluntary
Conversion”) to the Issuer. The business day (a “Business Day”) on
which a Notice of Voluntary Conversion is delivered in accordance with the
provisions hereof shall be deemed the “Voluntary Conversion
Date”. The Issuer will transmit the certificates representing Conversion
Shares issuable upon such conversion of the Note (together with the certificates
representing the Note not so converted) to the Holder via express courier, by
electronic transfer (if applicable) or otherwise, within ten Business Days after
the later to occur of (i) the Voluntary Conversion Date or (ii) the Business Day
on which the Issuer has received from the Holder the original Note being so
converted.

     

    4.           The
Issuer may, at its option, (i) on or after July 31, 2010, if the Company has
received one or more written firm commitments, or has closed on one or more
transactions, or a combination of the foregoing, of at least $3 million gross
proceeds of equity or debt; or (ii) on the Maturity Date, require the Holder to convert
the Note or any portion thereof, and any accrued and unpaid interest thereon,
into such number of Conversion Shares as is obtained by dividing the Loan Amount
by the Conversion Price.  The obligation of the Holder to convert the
Note may be exercised by the Company by telecopying, mailing (via first class
mail, postage prepaid) or personally delivering an executed and completed notice
of conversion (the “Notice of Mandatory
Conversion”) to the Holder’s Address maintained in the Note Register. The
Holder covenants and agrees to acknowledge a Notice of Mandatory Conversion in
writing by completing, dating and signing such Notice of Mandatory Conversion
and returning it to the Company by telecopier, first class mail (postage
prepaid) or personal delivery (the “Holder Acknowledgment Date”). The business
day on which a Notice of Mandatory Conversion is delivered in accordance with
the provisions hereof shall be deemed the “Mandatory Conversion
Date”. The Issuer will transmit the certificates representing Conversion
Shares issuable upon such conversion of the Note (together with the certificates
representing any portion of the Note not so converted) to the Holder via express
courier, by electronic transfer (if applicable) or otherwise within ten Business
Days after the later to occur of (i) the Holder Acknowledgment Date or (ii) the
date that the Issuer has received from the Holder the original Note being so
converted.

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

    5.           The
principal amount of this Note, and any accrued interest thereon, shall be
reduced as per that principal amount indicated on the Notice of Voluntary
Conversion or Notice of Mandatory Conversion, as the case may be, upon the
proper receipt by the Holder of such Conversion Shares due upon such Notice of
Voluntary Conversion or Notice of Mandatory Conversion.

     

    6.           The
number of Conversion Shares shall be adjusted as follows. If the Issuer shall at
any time subdivide its outstanding shares of Common Stock into a greater number
of shares of Common Stock, the number of Conversion Shares in effect immediately
prior to such subdivision shall be proportionately increased, and conversely, in
case the outstanding shares of Common Stock shall be combined into a smaller
number of shares of Common Stock, the number of Conversion Shares in effect
immediately prior to such subdivision shall be proportionately
decreased.

     

    7.           No
provision of this Note shall alter or impair the obligation of the Issuer, which
is absolute and unconditional, upon an Event of Default (as defined below), to
pay the principal of, and interest on this Note at the place, time, and rate,
and in the coin or currency herein prescribed.

     

    8.           Events
of Default.  Each of the following occurrences is hereby defined as an
“Event of Default”:

     

    a.           Nonpayment.  The
Issuer shall fail to make any payment of principal, interest, or other amounts
payable hereunder when and as due; or

     

    b.           Dissolutions,
etc.  The Issuer or any subsidiary shall fail to comply with
any provision concerning its existence or any prohibition against dissolution,
liquidation, merger, consolidation or sale of assets; or

     

    c.           Noncompliance with this
Agreement.  The Issuer shall fail to comply in any material
respect with any provision hereof, which failure does not otherwise constitute
an Event of Default, and such failure shall continue for ten (10) days after the
occurrence of such failure; or

     

    d.           Bankruptcy. Any
bankruptcy, insolvency, reorganization, arrangement, readjustment, liquidation,
dissolution, or similar proceeding, domestic or foreign, is instituted by or
against the Issuer or any of its subsidiaries, or the Issuer or any of its
subsidiaries shall take any step toward, or to authorize, such a proceeding;
or

     

    e.           Insolvency.  The
Issuer shall make a general assignment for the benefit of its creditors, shall
enter into any composition or similar agreement, or shall suspend the
transaction of all or a substantial portion of its usual business.

     

    9.           If
one or more “Events of Default” shall occur, then, or at any time thereafter,
and in each and every such case, unless such Event of Default shall have been
waived in writing by the Holder (which waiver shall not be deemed to be a waiver
of any subsequent default) or cured as provided herein, at the option of the
Holder, and in the Holder's sole discretion, the Holder may elect to consider
this Note (and all interest through such date) immediately due and payable. In
order to so elect, the Holder must deliver written notice of the election and
the amount due to the Issuer via certified mail, return receipt requested, at
the Issuer’s address as set forth herein (or any other address provided to the
Holder), and thereafter the Issuer shall have ten business days upon receipt to
cure the Event of Default, pay the Note, or convert the amount due on the Note
pursuant to the conversion formula set forth above. It is agreed that in the
event of such action, such Holder shall be entitled to receive all reasonable
fees, costs and expenses incurred, including without limitation such reasonable
fees and expenses of attorneys. The parties acknowledge that a change in control
of the Issuer shall not be deemed to be an Event of Default as set forth
herein.

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

     

    10.           In
case any provision of this Note is held by a court of competent jurisdiction to
be excessive in scope or otherwise invalid or unenforceable, such provision
shall be adjusted rather than voided, if possible, so that it is enforceable to
the maximum extent possible, and the validity and enforceability of the
remaining provisions of this Note will not in any way be affected or impaired
thereby.

     

    11           This
Note does not entitle the Holder hereof to any voting rights or other rights as
a stockholder of the Issuer prior to the conversion into Common Stock thereof,
except as provided by applicable law. If, however, at the time of the surrender
of this Note and conversion the Holder hereof shall be entitled to convert this
Note, the Conversion Shares so issued shall be and be deemed to be issued to
such holder as the record owner of such shares as of the close of business on
the Conversion Date.

     

    12.           This
Note and all other notes in this series may be subordinated to up to $10 million
of additional debt financing that the Issuer may incur prior to the Maturity
Date.

     

    IN
WITNESS WHEREOF, the Issuer has caused this Note to be duly executed by an
officer thereunto duly authorized.

     

    
      
        	 	 	 	BIOLARGO,
      INC.	 
	 	 	 	 	 
	
                 

              	 	 	
                By:  
      XXXXXX

              	 
	
                 

              	 	 	
                Name:
      Dennis P. Calvert, President

              	 
	
                 

              	 	 	
                 

              	 
	 	 	 	ACCEPTED:	 
	 	 	 	 	 
	 	 	 	Signature:   	 
	 	 	 	 	 
	 	 	 	Print
      Name: 	 
	 	 	 	 	 
	 	 	 	Holder’s
      Address:   	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 

      

       

    

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

     

    NOTICE
OF VOLUNTARY CONVERSION

    

    (To be
Executed by the Registered Holder in order to convert the Note)

    
 

    The
undersigned hereby irrevocably elects to convert $__________ of the principal
amount of the above Note, and $__________ of accrued and unpaid interest, into
___________ Shares of Common Stock of BioLargo, Inc. (the “Company”) according
to the conditions hereof, as of the date written below.

    

    The
undersigned represents and warrants to the Company that, as of the date hereof,
the undersigned is an “accredited investor” as that term is defined in Rule
501(a) of Regulation D under the Securities Exchange Act of 1934, as
amended.

     

    
       

      
        
          	
                  Date
      of Voluntary Conversion:     

                	 	 	
                  Signature:

                	 
	
                   

                	 	 	
                   

                	 
	
                   

                	 	 	
                  Print
      Name:  

                	 
	 	 	 	 	 
	 	 	 	Holder’s
      Address: 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	Social
      Security No.: 	 

        

         

        
          
             

            
              
                	 	 	 	      
                        ACCEPTED:

                        

                        BIOLARGO,
      INC.

                      	 
	 	 	 	 	 
	
                          

                      	 	 	
                        By
      (Signature)

                      	 
	
                         

                      	 	 	
                         

                      	 
	
                         

                      	 	 	
                        Print
      Name:   

                      	 
	 	 	 	 	 
	 	 	 	Title: 	 

              

               

            

          

        

      

    

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    

    NOTICE
OF MANDATORY CONVERSION

    

    (To be
Executed by the Company in order to required the Holder to convert the
Note)

    

    

    The
undersigned hereby notifies you of its irrevocably election to require you to
convert $___________ of the principal amount of the above Note, and $__________
of accrued and unpaid interest, into ___________ Shares of Common Stock of
BioLargo, Inc. according to the conditions hereof, as of the date written
below.

     

     

    
      
        
          	
                  Date
      of Mandatory Conversion:   

                	 	 	
                  BIOLARGO,
      INC.

                	 
	
                   

                	 	 	
                   

                	 
	
                   

                	 	 	
                  By
      (Signature)

                	 
	 	 	 	 	 
	 	 	 	Print
      Name:  	 
	 	 	 	 	 
	 	 	 	Title:	 

        

         

         

        6Unassociated Document

    EXHIBIT
4.20

     

     

    THIS
WARRANT AND THE SECURITIES REPRESENTED BY THIS WARRANT HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES ACT OF ANY STATE AND MAY NOT
BE SOLD OR TRANSFERRED UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER
SUCH ACTS COVERING THIS WARRANT AND THE SECURITIES REPRESENTED BY THIS WARRANT
OR PURSUANT TO AN EXEMPTION FROM THE REGISTRATION AND PROSPECTUS DELIVERY
REQUIREMENTS OF SUCH ACTS.

    

    

    BIOLARGO, INC.

    

    FORM
OF WARRANT TO PURCHASE COMMON STOCK

    (Eighteen
Month Warrant)

    

    
      	
              WARRANT
      NO. W-XXX

            	
              ISSUED:  XXXX,
2010

            

    

    

     

    THIS
CERTIFIES THAT, for value received, XXX(the “Holder”), is entitled
to subscribe for and purchase from BIOLARGO, INC., a corporation organized under
the laws of the state of Delaware (the “Company”), subject to
Section 1(b) hereof, commencing at the time periods prescribed herein and ending
at 5:00 p.m. California time on July 15, 2011, XXXX shares (the
“Shares”) of
common stock, par value, $0.00067, of the Company (the “Common Stock”). The
exercise price for each Share subject to this Warrant (the “Warrant Price”) is
equal to $0.75. The number of Shares and the Warrant Price are subject to
adjustment from time to time as provided in Section 4 of this
Warrant.

    

    This
Warrant is issued in connection with and as consideration for the Convertible
Note due April 15, 2013 dated the date hereof and issued by the Company in favor
of the Holder, which Convertible Note has been issued pursuant the Holder’s
investment in the Company.

    

    1.           Method of Exercise; Payment;
Issuance of New Warrant.

     

    (a) The
purchase right represented by this Warrant may be exercised by the Holder, in
whole or in part, subject to the limitation set forth below, and from time to
time, by (i) the surrender of this Warrant (with a notice of exercise in
the form attached hereto as Exhibit A, duly
executed) at the principal office of the Company and (ii) the payment to
the Company, by check or wire transfer of funds to an account specified in
writing by the Company, of an amount equal to the aggregate Warrant Price. The
Shares so purchased, representing the aggregate number of shares specified in
the executed Exhibit
A, shall be delivered to the Holder within a reasonable time, not
exceeding ten (10) business days, after this Warrant shall have been so
exercised. Upon receipt by the Company of this Warrant at the office of the
Company, in proper form for exercise and accompanied by the amount equal to the
aggregate Warrant Price, the Holder shall be deemed to be the holder of record
of the Shares issuable upon such exercise, notwithstanding that the stock
transfer books of the Company shall then be closed or that certificates
representing such Shares shall not then be actually delivered to the
Holder.

     

    (b) If
this Warrant shall have been exercised only in part, the Company shall, at the
time of delivery of such Shares, deliver to the Holder a new Warrant evidencing
the right to purchase the remaining Shares called for by this Warrant, which new
Warrant shall in all other respects be identical with this Warrant, or, at the
request of Holder, appropriate notation may be made on this Warrant which shall
then be returned to Holder.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    2.           Stock Fully Paid;
Reservation of Shares.  All Shares that may be issued upon the
exercise of the rights represented by this Warrant will, upon issuance, be fully
paid and nonassessable, and free from all preemptive rights, taxes, liens and
charges with respect to the issue thereof; provided, however, that the Company
shall not be required to pay any transfer taxes with respect to the issue of
shares in any name other than that of the registered holder
hereof.  During the period within which the rights represented by this
Warrant may be exercised, the Company will at all times have authorized, and
reserved for the purpose of the issue upon exercise of the purchase rights
evidenced by this Warrant, a sufficient number of shares of Common Stock to
provide for the exercise of the rights represented by this
Warrant.  The Company shall at all times take all such action and
obtain all such permits or orders as may be necessary to enable the Company
lawfully to issue such Common Stock as duly and validly issued, fully paid and
nonassessable shares upon exercise in full of this Warrant.

     

    3.           Fractional
Shares.  No fractional shares of Common Stock will be issued in
connection with any exercise hereunder, but in lieu of such fractional shares
the Company shall make a cash payment therefor upon the basis of the Fair Market
Value of such Shares.

     

    4.           Adjustment.  This
Warrant shall be subject to adjustment from time to time upon the occurrence of
certain events, as follows:

     

    (a) Adjustment for Stock Splits
and Combinations.  If the Company shall at any time or from
time to time after the date hereof effect a subdivision of the outstanding
Common Stock, the Warrant Price then in effect immediately before that
subdivision shall be proportionately decreased.  If the Company shall
at any time or from time to time after the date hereof combine the outstanding
Common Stock, the Warrant Price then in effect immediately before the
combination shall be proportionately increased.  Any adjustment under
this subsection shall become effective at the close of business on the date the
subdivision or combination becomes effective.

     

    (b) Adjustment for Certain
Dividends and Distributions.  In the event the Company at any
time or from time to time after the date hereof shall make or issue a dividend
or other distribution payable in additional shares of Common Stock, then and in
each such event the Warrant Price shall be decreased as of the time of such
issuance, by multiplying the Warrant Price by a fraction:

     

    
      	
               
      

            	
              (x)

            	
              the
      numerator of which shall be the total number of shares of Common Stock
      issued and outstanding immediately prior to the time of such issuance;
      and

            

    

     

    
      	
               
      

            	
              (y)

            	
              the
      denominator of which shall be the total number of shares of Common Stock
      issued and outstanding immediately prior to the time of such issuance plus
      the number of shares of Common Stock issuable in payment of such dividend
      or distribution.

            

    

    

    (c) Adjustment of Number of
Shares.  Upon each adjustment of the Warrant Price pursuant to
either Section 4(a) or
4(b) of this
Warrant, the number of shares of Common Stock purchasable upon exercise of this
Warrant shall be adjusted to the number of shares of Common Stock, calculated to
the nearest one hundredth of a share, obtained by multiplying the number of
shares of Common Stock purchasable immediately prior to such adjustment upon the
exercise of the Warrant by the Warrant Price in effect prior to such adjustment
and dividing the product so obtained by the new Warrant Price.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    (d) Adjustment for
Reclassification, Exchange and Substitution.  If the Common
Stock issuable upon the exercise of this Warrant are changed into the same or
different number of shares of any class or classes of stock, whether by
recapitalization, reclassification or otherwise (other than a subdivision or
combination provided for in Section 4(a)
above, a dividend or distribution provided for in Section 4(b)
above, or a reorganization, merger, consolidation or sale of assets, provided
for in Section 4(e)
below), then and in any such event the Holder shall have the right thereafter to
exercise this Warrant into the kind and amount of stock and other securities
receivable upon such recapitalization, reclassification or other change, by
holders of the number of shares of Common Stock for which this Warrant might
have been exercised immediately prior to such recapitalization, reclassification
or change.

     

    (e) Reorganization, Mergers,
Consolidations or Sales of Assets.  If at any time or from time
to time there is a capital reorganization of the Common Stock (other than a
subdivision or combination provided for in Section 4(a)
above, a dividend or distribution provided for in Section 4(b)
above, or a reclassification or exchange of shares provided for in Section 4(d)
above) or a merger or consolidation of the Company with or into another entity,
or a sale of all or substantially all of the Company’s properties and assets to
any other person or entity, then, as a part of such reorganization, merger,
consolidation or sale, provision shall be made so that the Holder shall
thereafter be entitled to receive upon exercise of this Warrant the number of
shares of stock or other securities, money or property of the Company, or of the
successor entity resulting from such merger or consolidation or sale, to which a
holder of Common Stock deliverable upon conversion would have been entitled on
such capital reorganization, merger, consolidation, or sale.  The
Company shall not effect any reorganization, merger, consolidation or sale
unless prior to the consummation thereof each entity or person (other than the
Company) that may be required to deliver any cash, securities or other property
upon the exercise of this Warrant shall assume, by written instrument delivered
to the Holder, the obligation to deliver to the Holder such cash, securities or
other property as in accordance with the foregoing provisions the Holder may be
entitled to receive.  The foregoing provisions of this Section 4(e)
shall similarly apply to successive reorganizations, mergers, consolidations and
sales.

     

    (f) No
Impairment.  The Company will not, by amendment of its Articles
of Incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms to be observed or performed hereunder by the Company but will at all
times in good faith assist in the carrying out of all the provisions of this
Section and in the taking of all such action as may be necessary or appropriate
in order to protect the conversion rights of the Holder against dilution or
other impairment. Without limiting the generality of the foregoing, the Company
will not issue any capital stock of any class which is preferred as to dividends
or as to the distribution of assets upon the voluntary or involuntary
dissolution, liquidation or winding up of the Company.

     

    (g) Notice of
Adjustments.  Whenever this Warrant shall be adjusted pursuant
to this Section 4, the
Company shall make a certificate signed by an officer of the Company setting
forth, in reasonable detail, the event requiring the adjustment, the amount of
the adjustment, the method by which such adjustment was calculated, and the new
Warrant Price and the type or the number of Shares purchasable after giving
effect to such adjustment, and shall cause copies of such certificate to be
mailed (by first class mail, postage prepaid) to the Holder.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    5.           The Company’s Obligation to
Make Payments.

     

    (a) Dividends and
Distributions.  In the event the Company at any time or from
time to time after the date hereof shall make or issue a dividend or other
distribution, whether payable in cash, securities or other property of the
Company, with respect to any of its capital stock for which an adjustment is not
made pursuant to Section 4 of this
Warrant, then and in each such event, the Company shall concurrently make a cash
payment to the Holder equal to the product of (i) the quotient obtained by
dividing (x) the amount of cash plus the fair value of any property or
securities distributed by (y) the number of shares of Common Stock outstanding
on the record date for such dividend or distribution and (ii) the number of
Shares on such record date.

     

    (b) Redemption of Capital
Stock.  In the event the Company at any time or from time to
time after the date hereof shall repurchase or redeem any of its capital stock
or any rights, including without limitation, options, warrants or other
convertible or exchangeable securities, to acquire such capital stock, then and
in each such event, the Company shall concurrently make a cash payment to the
Holder equal to the product of (i) the quotient obtained by dividing
(x) the aggregate amount of cash and the aggregate fair value of any
property paid out by the Company in connection with any such repurchase or
redemption by (y) the number of shares of Common Stock outstanding on a fully
diluted basis immediately after such repurchase or redemption and (2) the number
of Shares.

     

    6.           Notice of Record
Date.  In the event:

     

    
      	
               
      

            	
              (1)

            	
              that
      the Company declares a dividend (or any other distribution) on any of its
      capital stock (including without limitation, its Common
      Stock);

            

    

     

    
      	
               
      

            	
              (2)

            	
              that
      the Company repurchases or redeems any of its capital stock (including
      without limitation, its Common Stock) or any rights to acquire such
      capital stock;

            

    

     

    
      	
               
      

            	
              (3)

            	
              that
      the Company subdivides or combines its outstanding shares of Common
      Stock;

            

    

     

    
      	
               
      

            	
              (4)

            	
              of
      any reclassification of the Common Stock, or of any consolidation, merger
      or share exchange of the Company into or with another entity, or of the
      sale of all or substantially all of the assets of the
    Company;

            

    

     

    
      	
               
      

            	
              (5)

            	
              of
      the involuntary or voluntary dissolution, liquidation or winding up of the
      Company; or

            

    

    

    
      	
               
      

            	
              (6)

            	
              of
      any offer of its Common Stock or any rights to acquire such Common Stock
      for consideration paid per share of Common Stock less than the Warrant
      Price then in effect.

            

    

     

    then the
Company shall notify the Holder at least 30 days prior to the date
specified in (A), (B) or (C) below, in writing stating:

     

    (A)           the
record date of such dividend, distribution, repurchase, redemption, subdivision
or combination, or, if a record is not to be taken, the date as to which the
holders of Common Stock of record to be entitled to such dividend, distribution,
repurchase, redemption, subdivision or combination are to be
determined;

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    (B)           the
date on which such reclassification, consolidation, merger, share exchange,
sale, dissolution, liquidation or winding up is expected to become effective,
and the date as of which it is expected that holders of Common Stock of record
shall be entitled to exchange their shares of Common Stock for securities or
other property deliverable upon such reclassification, consolidation, merger,
sale, dissolution or winding up; or

     

    (C)           the
date on which such offering of its Common Stock or any rights to acquire such
Common Stock for consideration paid per share of Common Stock less than the
Warrant Price is expected to become consummated.

    

    7.           Compliance with Securities
Act; Disposition of Warrant or Common Stock.

     

    (a) Compliance with Securities
Act.  The Holder, by acceptance hereof, agrees that this
Warrant and the Shares to be issued upon exercise hereof are being acquired for
investment and that such Holder will not offer, sell or otherwise dispose of
this Warrant or any Common Stock to be issued upon exercise hereof except under
circumstances which will not result in a violation of the Securities Act of
1933, as amended (the “Act”).  All
Shares issued upon exercise of this Warrant (unless registered under the Act or
sold or transferred pursuant to Rule 144 promulgated under the Act) shall be
stamped or imprinted with a legend in substantially the following
form:

     

    “THIS
SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE
SECURITIES ACTS OF ANY STATE AND MAY NOT BE SOLD OR TRANSFERRED UNLESS THERE IS
AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACTS COVERING THIS SECURITY OR
PURSUANT TO AN EXEMPTION FROM THE REGISTRATION AND PROSPECTUS DELIVERY
REQUIREMENTS OF SUCH ACTS.”

    

    (b) Disposition of Warrant or
Shares.  Subject to the terms and conditions of this Warrant
and applicable securities laws, this Warrant and the rights represented by this
Warrant may be transferred, assigned or pledged, in whole or in part with prior
written notice to the Company. Any transfer shall be accompanied by the Notice
of Transfer form attached hereto as Exhibit
B.

     

    8.           Rights as
Shareholders.  The Holder shall not, by virtue hereof, be
entitled to any rights of a shareholder in the Company, either at law or equity,
and the rights of the Holder are limited to those expressed in this Warrant and
are not enforceable against the Company except to the extent set forth
herein.

     

    9.           Representations and
Warranties.  The Company represents and warrants to the Holder
as follows:

     

    (a) This
Warrant has been duly authorized and executed by the Company and is a valid and
binding obligation of the Company enforceable in accordance with its
terms;

     

    (b) The
Shares have been duly authorized and reserved for issuance by the Company and,
when issued in accordance with the terms hereof, will be validly issued, fully
paid and nonassessable;

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    (c) The
rights, preferences, privileges and restrictions granted to or imposed upon the
Shares and the holders thereof are as set forth in the Company’s Certificate of
Incorporation;

     

    (d) The
execution and delivery of this Warrant are not, and the issuance of the Shares
upon exercise of this Warrant in accordance with the terms hereof will not be,
inconsistent with the Company’s Articles of Incorporation or by-laws, do not and
will not contravene any law, governmental rule or regulation, judgment or order
applicable to the Company, and, except for consents that have already been
obtained by the Company, do not and will not conflict with or contravene any
provision of, or constitute a default under, any indenture, mortgage, contract
or other instrument of which the Company is a party or by which it is bound or
require the consent or approval of, the giving of notice to, the registration
with or the taking of any action in respect of or by, any federal, state or
local government authority or agency or other person; and

     

    10.           Modification and
Waiver.  This Warrant and any provision hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by the
party against which enforcement of the same is sought.

     

    11.           Notices.  Except
as otherwise expressly provided herein, all notices and other communications
provided for hereunder shall be in writing (including telegraphic, telex,
telecopier or cable communication) and mailed, telegraphed, telexed, telecopied,
cabled or delivered to the applicable party at its address specified opposite
its signature below, or at such other address as shall be designated by such
party in a written notice to the other.  All such notices and
communications shall, when mailed, telegraphed, telexed, telecopied or cabled or
sent by overnight courier, be effective when deposited in the mails, delivered
to the telegraph company, cable company or overnight courier, as the case may
be, or sent by telex or telecopier.

     

    12.           Descriptive
Headings.  The descriptive headings of the several sections of
this Warrant are inserted for convenience only and do not constitute a part of
this Warrant.

     

    13.           Governing
Law.  THIS WARRANT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF CALIFORNIA.

     

    14.           Binding Effect on
Successors.  This Warrant shall be binding upon any entity
succeeding the Company by merger, consolidation or acquisition of all or
substantially all of the Company’s assets, and all of the obligations of the
Company relating to the Common Stock issuable upon the exercise of this Warrant
shall survive the exercise, and termination of this Warrant and all of the
covenants and agreements of the Company shall inure to the benefit of the
successors and assigns of the Holder.

     

    15.           Severability.  In
case any one or more of the provisions contained in this Warrant shall be
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein shall not in any way
be affected or impaired thereby.  The parties shall endeavor in good
faith negotiations to replace the invalid, illegal or unenforceable provisions
with valid provisions, the economic effect of which comes as close as possible
to that of the invalid, illegal or unenforceable provisions.

     

    16.           Lost Warrants or Stock
Certificates.  The Company covenants to the Holder that upon
receipt of evidence reasonably satisfactory to the Company of the loss, theft,
destruction, or mutilation of this Warrant or any stock certificate and, in the
case of any such loss, theft or destruction, upon receipt of an indemnity
reasonably satisfactory to the Company, or in the case of any such mutilation
upon surrender and cancellation of such Warrant or stock certificate, the
Company will make and deliver a new Warrant or stock certificate, of like tenor,
in lieu of the lost, stolen, destroyed or mutilated Warrant or stock
certificate.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed and
delivered by its duly authorized officer on the day and year first above
written.

     

    
      
        	 	 	 	BIOLARGO,
      INC.	 
	 	 	 	 	 
	
                 

              	 	 	
                By: XXXXXX

              	 
	
                 

              	 	 	
                Name:
      Dennis P. Calvert, President

              	 
	
                 

              	 	 	
                Address:
      16333 Phoebe

                                 La
      Mirada, California 90638

                                 Attention:
      Dennis P. Calvert

              	 

      

       

    

    ACKNOWLEDGED
AND ACCEPTED:

    

    By:                                                                        

    

    Print
Name:                                                                              

    

    Address:
__________________________

     __________________________

                   
 __________________________

    

    Federal
ID

    or Social
Security No.                                        

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    

    EXHIBIT
A

    

    NOTICE
OF EXERCISE

    

    

    TO:           BIOLARGO,
INC.

    

    (1)           The
undersigned hereby elects to purchase __________ shares of Common Stock of
BIOLARGO, INC. (the “Company”) pursuant to the terms of the attached Warrant,
and, unless such Warrant allows the exercise to be “cashless,” tenders herewith
payment of the Warrant Price for such shares in full.

    

    (2)           The
undersigned represents and warrants to the Company that, as of the date hereof,
the undersigned is an “accredited investor” as that term is defined in Rule
501(a) of Regulation D under the Securities Exchange Act of 1934, as
amended.

    

    (3)           Please
issue a certificate or certificates representing said shares of Common Stock in
the name of the undersigned or in such other name as is specified
below:

    

    
      
        	 	 	 	 	 
	
                 

              	 	 	
                 

              	 
	
                 

              	 	 	
                (Name) 

              	 

      

      

      
        
          	 	 	 	 	 
	
                   

                	 	 	
                   

                	 
	
                   

                	 	 	
                  (Name) 

                	 

        

         

      

    

    (4)           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) 

                	 

        

        

        
          
            	 	 	 	 	 
	
                     

                  	 	 	
                     

                  	 
	
                     

                  	 	 	
                    (Address)

                  	 

          

           

        

      

      
        
          	 	 	 	 	 
	
                   

                	 	 	
                   

                	 
	
                   

                	 	 	
                  (Federal
      ID or Social Security No.)

                	 

        

        

        
          
            	 	 	 	 	 
	
                     

                  	 	 	
                     

                  	 
	
                     

                  	 	 	
                    (Signature)

                  	 

          

          
            

            
              
                	 	 	 	 	 
	
                         

                      	 	 	
                         

                      	 
	
                         

                      	 	 	
                        (Date)

                      	 

              

               

              
                
                  
                  

                

                
                  8

                  
                    

                  

                

                
                  
                  

                

              

            

          

        

      

    

     

    EXHIBIT
B

    

    NOTICE
OF TRANSFER

     

    (To be
signed only upon transfer of Warrant and subject to other conditions of this
Warrant)

    

    FOR VALUE
RECEIVED, the undersigned hereby sells, assigns and transfers unto
____________________________________________ the right represented by the
attached Warrant to purchase __________ shares of the Common Stock of BIOLARGO,
INC., to which the attached Warrant relates, and appoints _____________________
as Attorney-in-fact to transfer such right on the books of BIOLARGO, INC., with
full power of substitution in the premises.

    

    The
undersigned understands that any transfer of the attached Warrant is subject to
full compliance with Federal and applicable state securities laws and other
requirements, which requirements shall be determined and which issues shall be
decided by BIOLARGO, INC., in its sole and absolute discretion, prior to
consenting to and recognizing such transfer.

    

    Dated:                                           

     

    
      
        
          	 	 	 	 	 
	
                   

                	 	 	
                   

                	 
	
                   

                	 	 	
                  (Signature
      must conform in all respects to the name of the Holder as specified on the
      face of the Warrant)

                	 

        

        
          

          
            
              	 	 	 	 	 
	
                       

                    	 	 	
                       

                    	 
	
                       

                    	 	 	
                      (Address)

                    	 

            

             

          

        

      

    

    Signed in
the presence of:                                                                                     

     

     

     

    9

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