Document:

Exhibit 4.6

 

WARRANT
AGENT AGREEMENT

 

This
Warrant Agent Agreement (this “Agreement”) is made effective as of February 1, 2018, by and between Zion
Oil & Gas, Inc., a Delaware corporation having its principal place of business at 12655 North Central Expressway, Suite 1000,
Dallas, Texas 75243 (the “Company”), and American Stock Transfer & Trust Company, LLC, a New York
limited liability trust company with offices at 6201 15th Avenue, Brooklyn, NY 11219 (“AST”)
and is an amendment to the Warrant Agent Agreement dated August 1, 2014 between the Company and AST, to the February 2, 2015 amendment
to the Warrant Agent Agreement, to the November 1, 2016 amendment to the Warrant Agent Agreement, to the May 22, 2017 amendment
to the Warrant Agent Agreement and to the October 12, 2017 amendment to the Warrant Agent Agreement by the expansion of the Unit
option program. 

 

WHEREAS,
the Company has implemented a Dividend Reinvestment and Common Stock Purchase Plan (hereinafter “DSPP”)
and AST is administering the DSPP as the Plan agent (the “Plan Agent”) and Warrant agent (the “Warrant
Agent”), effective August 1, 2014, (1) under a Warrant Agreement dated August 1, 2014 that is still in effect for
the $2.50 Unit option program and as the continuation of AST as the Warrant Agent under the DSPP for the Warrant ZNWAA, (2) under
a Warrant Agent Agreement dated February 2, 2015 that is still in effect for the $4.00 Unit option program and as the continuation
of AST as the Warrant Agent under the DSPP for the Warrants ZNWAC and ZNWAD, (3) under a Warrant Agent Agreement dated November
1, 2016 that is still in effect for the $10.00 Unit option program for the Warrant ZNWAE, (4) under a Warrant Agent Agreement
dated May 22, 2017 for the Warrant ZNWAF that is still in effect for the $250.00 Unit option program, (5) under a Warrant Agent
Agreement dated October 12, 2017 for the Warrant ZNWAG that is still in effect for the $250.00 Unit option program and as the
continuation of AST as the Warrant Agent under the DSPP for the Warrant ZNWAH;

 

WHEREAS,
pursuant to the DSPP, the Company is offering a new unit option program consisting of a new Unit (each a “Unit”
and collectively the “Units”) of its securities to existing stockholders and investors, with each Unit
(priced at $250.00 each) is comprised of (i) fifty (50) shares of Common Stock and (ii) Common Stock purchase warrants to purchase
an additional fifty (50) shares of Common Stock. The Unit Option begins on February 1, 2018 and is scheduled to terminate on the
earlier of February 28, 2018 or when this Unit Option receives $5 million in Unit purchases. The investor’s Plan account
will be credited with the number of shares of the Company’s Common Stock that is acquired under the Units purchased. Each
warrant affords the investor the opportunity to purchase one share of our Common Stock at an exercise price of $5.00 per share
(each “Warrant” and collectively the “Warrants”) and each Unit may be purchased
at a per Unit price of $250.00;

 

WHEREAS,
the new Warrants will be exercisable beginning on the first trading day after the 31st day following the Unit Option
Termination Date (i.e., on the earlier of February 28, 2018 or when this Unit Option receives $5 million in Unit purchases) and
continue to be exercisable for one (1) year after the exercise date at a per share exercise price of $5.00 for Warrant ZNWAH;

 

WHEREAS,
the Company is utilizing the Registration Statement on Form S-3 (Registration No. 333-216191), as amended, which was declared
effective by the SEC on March 10, 2017 (the “Registration Statement”) and Amendment No. 3 filed February
1, 2018 to facilitate the trading of the shares of Common Stock included in the new Units and the shares of Common Stock underlying
the Warrants that are included in the Units as well as the Warrants;

 

     

     

    

 

WHEREAS,
the shares of Common Stock included in the Units are tradable on the NASDAQ under the symbol ZN and, following the closing of
the Unit program, the shares of Common Stock underlying the Warrants, will be tradable after Warrant exercise on the NASDAQ under
the symbol ZN;

 

WHEREAS,
the Company desires AST to act on behalf of the Company, and AST is willing to so act, in connection with the issuance, registration,
transfer, exchange, redemption and exercise of the Warrants (in such capacity, the “Warrant Agent”)
herein described;

 

WHEREAS,
the Company desires to provide for the form and provisions of the Warrant, the terms upon which it shall be issued and exercised,
and the respective rights, limitation of rights, and immunities of the Company, the Warrant Agent, and the holders of the Warrants;
and

 

WHEREAS,
all acts and things have been done and performed which are necessary to make the Warrants, when executed on behalf of the Company
and countersigned by or on behalf of the Warrant Agent, as provided herein, the valid, binding and legal obligations of the Company,
and to authorize the execution and delivery of this Agreement.

 

NOW,
THEREFORE, in consideration of the mutual agreements herein contained, the parties hereto agree as follows:

 

1.
  Appointment of Warrant Agent. The Company hereby appoints the Warrant Agent to act as agent for the Company for
the Warrants herein described, and the Warrant Agent hereby accepts such appointment and agrees to perform the same in accordance
with the terms and conditions set forth in this Agreement.

   

2.
  New Warrant.

 

2.1
  Form of Warrant. The Warrant shall be issued in registered form or held in book entry form by AST as Warrant Agent.
The Warrant shall be in substantially the form of Exhibit A hereto, the provisions of which are incorporated herein,
and shall be signed by, or bear the facsimile signature of, the Executive Chairman and Secretary/Treasurer of the Company and
shall bear a facsimile of the Company’s seal. In the event the person whose facsimile signature has been placed upon any Warrant
shall have ceased to serve in the capacity in which such person signed the Warrant before such Warrant is issued, it may be issued
with the same effect as if he or she had not ceased to be such at the date of issuance.

 

2.2
  Effect of Countersignature. Unless and until countersigned by the Warrant Agent pursuant to this Agreement, a Warrant
shall be invalid and of no effect and may not be exercised by the holder thereof, unless acknowledged and held in book entry form
by the Warrant Agent.

 

2.3
  Registration.

 

2.3.1
  Warrant Register. The Warrant Agent shall maintain books (“Warrant Register” or also referred
to as “book entry form”) for the registration of original issuance and the registration of transfer
of the Warrants, if the Warrants are not held in book entry form by Warrant Agent. Upon the initial issuance of the Warrants unless
held in book entry form by the Warrant Agent, the Warrant Agent shall issue and register the Warrants in the names of the respective
holders thereof in such denominations and otherwise in accordance with instructions delivered to the Warrant Agent by the Company.

 

    2

     

    

 

2.3.2
  Registered Holder. Prior to due presentment for registration of transfer of any Warrant, the Company and the Warrant
Agent may deem and treat the person in whose name such Warrant shall be registered upon the Warrant Register (“registered
holder”), as the absolute owner of such Warrant and of each Warrant represented thereby (notwithstanding any notation
of ownership or other writing on the Warrant Certificate made by anyone other than the Company or the Warrant Agent), for the
purpose of any exercise thereof, and for all other purposes, and neither the Company nor the Warrant Agent shall be affected by
any notice to the contrary.

 

3.
  Terms and Exercise of Warrants.

 

3.1
  Warrant Price. Each Warrant shall, when countersigned by the Warrant Agent, entitle the registered holder thereof,
subject to the provisions of such Warrant and this Warrant Agreement, to purchase from the Company the number of shares of Common
Stock stated therein, at the price of $5.00 per share, subject to the adjustments provided in this Section 3.1 and Section 4 hereof.
The term “Warrant Price” as used in this Warrant Agreement refers to the price per share at which Common Stock may be
purchased at the time a Warrant is exercised. The Company in its sole discretion may lower the Warrant Price at any time prior
to the Expiration Date for a period of not less than ten business days, provided that any such reduction shall be identical among
all of the Warrants.

 

3.2
  Duration of Warrants. A Warrant may be exercised only during the period commencing on the first trading day after
the 31st day following the Unit Option Termination Date (i.e., on the earlier of February 28, 2018 or when this Unit
Option receives $5 million in Unit purchases) and continue to be exercisable for one (1) year after the exercise date, terminating
at 5:00 p.m., Eastern Standard Time. Notwithstanding the foregoing, no Warrant shall be exercisable unless, at the time of exercise,
a registration statement relating to the Common Stock issuable upon the exercise of such Warrant is effective and current and
a prospectus is available for use by the holders thereof and the Common Stock has been qualified or deemed to be exempt under
the securities laws of the state of residence of the holder of such Warrants. The period during which a Warrant may be exercised
shall be deemed the “Exercise Period” and the termination of such Exercise Period shall be deemed the
“Expiration Date.” Each Warrant not exercised on or before the Expiration Date shall become void, and
all rights thereunder and all rights in respect thereof under this Agreement shall cease at the close of business on the Expiration
Date. The Company in its sole discretion may extend the duration of the Warrants by delaying the Expiration Date; provided, however,
the Company will provide notice to registered holders of the Warrants of such extension of not less than 20 days and, further
provided that any such extension shall be identical in duration among all of the Warrants.

  

3.3
  Exercise of Warrants.

 

3.3.1
  Payment. Subject to the provisions of the Warrants and this Agreement, a Warrant, when countersigned by the Warrant
Agent, may be exercised by the registered holder thereof by surrendering it at the office of the Warrant Agent, or at the office
of its successor as Warrant Agent, in Brooklyn, New York, with the subscription form, as set forth in the Warrant, or exercised
by other electronic means acceptable to the Company, duly executed by paying in full, by bank check, bank wire, other electronic
bank payment method, or other legal currency means of payment acceptable by the Company and payable to the order of the Company,
the Warrant Price for each full share of Common Stock as to which the Warrant is exercised and any and all applicable taxes due
in connection with the exercise of the Warrant, the exchange of the Warrant for the Common Stock and the issuance of the Common
Stock.

 

    3

     

    

 

3.3.2
  Issuance of Certificates. As soon as practicable after the exercise of any Warrant and the clearance of the funds
in payment of the Warrant Price, the Company shall issue to the registered holder of such Warrant a certificate or certificates
for the number of full shares of Common Stock to which he, she or it is entitled, registered in such name or names as may be directed
by him, her or it, and if such Warrant shall not have been exercised in full, a new countersigned Warrant for the number of shares
as to which such Warrant shall not have been exercised, unless the Common Stock is to be held in book entry form by AST without
the issuance of a certificate and any remaining balance of Warrants to be maintained in book entry form by the Warrant Agent.
Notwithstanding the foregoing, the Company shall not be obligated to deliver or to recognized in book entry form any securities
pursuant to the exercise of a Warrant unless (i) a registration statement under the Act with respect to the Common Stock issuable
upon such exercise is effective, or (ii) in the opinion of counsel to the Company, the exercise of the Warrants is exempt from
the registration requirements of the Act and such securities are qualified for sale or exempt from qualification under applicable
securities laws of the states or other jurisdictions in which the registered holders reside. Warrants may not be exercised by,
or securities issued to, any registered holder in any state in which such exercise or issuance would be unlawful. In no event
will the Company be required to provide the registered holder of a warrant with a net-cash settlement or other consideration in
lieu of physical settlement in shares of Common Stock, regardless of whether the Common Stock underlying the Warrants is
registered pursuant to an effective registration statement.

 

3.3.3
  Valid Issuance. All shares of Common Stock issued upon the proper exercise of a Warrant in conformity with this
Agreement shall be validly issued, fully paid and nonassessable.

 

3.3.4
  Date of Issuance. Each person in whose name any such certificate for shares of Common Stock is issued shall for
all purposes be deemed to have become the holder of record of such shares on the date on which the Warrant was surrendered and
payment of the Warrant Price was made, irrespective of the date of delivery of such certificate or the recording by book entry,
except that, if the date of such surrender and payment is a date when the stock transfer books of the Company are closed, such
person shall be deemed to have become the holder of such shares at the close of business on the next succeeding date on which
the stock transfer books are open.

 

4.
  Adjustments.

 

4.1
  Stock Dividends Split Ups. If after the date hereof, and subject to the provisions of Section 4.6 below, the number
of outstanding shares of Common Stock is increased by a stock dividend payable in shares of Common Stock, or by a split up of
shares of Common Stock, or other similar event, then, on the effective date of such stock dividend, split up or similar event,
the number of shares of Common Stock issuable on exercise of each Warrant shall be increased in proportion to such increase in
outstanding shares of Common Stock. For purposes of clarification, no adjustment shall be made in the event of a rights offering,
or a distribution of rights treated as a dividend to all shareholders of record, or similar transactions.

 

4.2
  Aggregation of Shares. If after the date hereof, and subject to the provisions of Section 4.6, the number of outstanding
shares of Common Stock is decreased by a consolidation, combination, reverse stock split or reclassification of shares of Common
Stock or other similar event, then, on the effective date of such consolidation, combination, reverse stock split, reclassification
or similar event, the number of shares of Common Stock issuable on exercise of each Warrant shall be decreased in proportion to
such decrease in outstanding shares of Common Stock.

 

    4

     

    

 
 

4.3
  Adjustments in Exercise Price. Whenever the number of shares of Common Stock purchasable upon the exercise of the
Warrants is adjusted, as provided in Section 4.1 and 4.2 above, the Warrant Price shall be adjusted (to the nearest cent) by multiplying
such Warrant Price immediately prior to such adjustment by a fraction (x) the numerator of which shall be the number of shares
of Common Stock purchasable upon the exercise of the Warrants immediately prior to such adjustment, and (y) the denominator of
which shall be the number of shares of Common Stock so purchasable immediately thereafter.

 

 4.4
  Replacement of Securities upon Reorganization, etc. In case of any reclassification or reorganization of the outstanding
shares of Common Stock (other than a change covered by Section 4.1 or 4.2 hereof or that solely affects the par value of such
shares of Common Stock), or in the case of any merger or consolidation of the Company with or into another corporation (other
than a consolidation or merger in which the Company is the continuing corporation and that does not result in any reclassification
or reorganization of the outstanding shares of Common Stock), or in the case of any sale or conveyance to another corporation
or entity of the assets or other property of the Company as an entirety or substantially as an entirety in connection with which
the Company is dissolved, the Warrant holders shall thereafter have the right to purchase and receive, upon the basis and upon
the terms and conditions specified in the Warrants and in lieu of the shares of Common Stock of the Company immediately theretofore
purchasable and receivable upon the exercise of the rights represented thereby, the kind and amount of shares of stock or other
securities or property (including cash) receivable upon such reclassification, reorganization, merger or consolidation, or upon
a dissolution following any such sale or transfer, that the Warrant holder would have received if such Warrant holder had exercised
his, her or its Warrant(s) immediately prior to such event; and if any reclassification also results in a change in shares of
Common Stock covered by Section 4.1 or 4.2, then such adjustment shall be made pursuant to Sections 4.1, 4.2, 4.3 and this
Section 4.4. The provisions of this Section 4.4 shall similarly apply to successive reclassifications, reorganizations, mergers
or consolidations, sales or other transfers.

 

4.5
  Notices of Changes in Warrant. Upon every adjustment of the Warrant Price or the number of shares issuable on exercise
of a Warrant, the Company shall give written notice thereof to the Warrant Agent, which notice shall state the Warrant Price resulting
from such adjustment and the increase or decrease, if any, in the number of shares purchasable at such price upon the exercise
of a Warrant, setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based.
Upon the occurrence of any event specified in Sections 4.1, 4.2, 4.3 or 4.4, then, in any such event, the Company shall give written
or electronic notice to the Warrant holder, at the last address set forth for such holder in the Warrant Register, of the record
date or the effective date of the event. Failure to give such notice, or any defect therein, shall not affect the legality or
validity of such event.

 

4.6
 Form of Warrant. The form of Warrant need not be changed because of any adjustment pursuant to this Section 4, and
Warrants issued after such adjustment may state the same Warrant Price and the same number of shares as is stated in the Warrants
initially issued pursuant to this Agreement. However, the Company may at any time in its sole discretion make any change in the
form of Warrant that the Company may deem appropriate and that does not affect the substance thereof, and any Warrant thereafter
issued or countersigned, whether in exchange or substitution for an outstanding Warrant or otherwise, may be in the form as so
changed.

 

    5

     

    

 
 

5.
  Transfer and Exchange of Warrants.

 

5.1
  Registration of Transfer. The Warrant Agent shall register the transfer, from time to time, of any outstanding Warrant
upon the Warrant Register, upon surrender of such Warrant for transfer, properly endorsed with signatures properly guaranteed
and accompanied by appropriate instructions for transfer. Upon any such transfer, a new Warrant representing an equal aggregate
number of Warrants shall be issued and the old Warrant shall be cancelled by the Warrant Agent. The Warrants so cancelled shall
be delivered by the Warrant Agent to the Company from time to time upon request.

  

5.2
  Procedure for Surrender of Warrants. Warrants may be surrendered to the Warrant Agent, together with a written request
for exchange, and thereupon the Warrant Agent shall issue in exchange therefor one or more new Warrants as requested by the registered
holder of the Warrants so surrendered, representing an equal aggregate number of Warrants; provided, however, in the event a Warrant
surrendered for transfer bears a restrictive legend, the Warrant Agent shall not cancel such Warrant and issue new Warrants in
exchange therefor until the Warrant Agent has received an opinion of counsel for the Company stating such transfer may be made
and indicating whether the new Warrants must also bear a restrictive legend. Book-entry held warrants may be surrendered electronically
by any means acceptable to the Company.

 

5.3
  Fractional Warrants. The Warrant Agent shall not be required to effect any registration of transfer or exchange
which will result in the issuance of a warrant certificate for a fraction of a warrant.

 

5.4
  Service Charges. No service charge shall be made for any exchange or registration of transfer of Warrants.

 

5.5
  Warrant Execution and Countersignature. The Warrant Agent is hereby authorized to countersign and deliver, in accordance
with the terms of this Agreement, the Warrants required to be issued pursuant to the provisions of this Section 5, and the Company,
whenever required by the Warrant Agent, will supply the Warrant Agent with Warrants duly executed on behalf of the Company for
such purpose.

 

6.
  Other Provisions Relating to Rights of Holders of Warrants.

 

6.1
  No Rights as Stockholder. A Warrant does not entitle the registered holder thereof to any of the rights of a stockholder
of the Company, including, without limitation, the right to receive dividends, or other distributions, exercise any preemptive
rights to vote or to consent or to receive notice as stockholders in respect of the meetings of stockholders or the election of
directors of the Company or any other matter.

 

6.2
  Lost, Stolen, Mutilated, or Destroyed Warrants. If any Warrant is lost, stolen, mutilated, or destroyed, the Company
and the Warrant Agent may on such terms as to indemnity or otherwise as they may in their discretion impose (which shall, in the
case of a mutilated Warrant, include the surrender thereof), issue a new Warrant of like denomination, tenor, and date as the
Warrant so lost, stolen, mutilated, or destroyed. Any such new Warrant shall constitute a substitute contractual obligation of
the Company, whether or not the allegedly lost, stolen, mutilated, or destroyed Warrant shall be at any time enforceable by anyone.

 

    6

     

    

 

6.3
  Reservation of Common Stock. The Company shall at all times reserve and keep available a number of its authorized
but unissued shares of Common Stock that will be sufficient to permit the exercise in full of all outstanding Warrants issued
pursuant to this Agreement.

 
 

7.
  Concerning the Warrant Agent and Other Matters.

 

7.1
  Payment of Taxes. The Company will from time to time promptly pay all taxes and charges that may be imposed upon
the Company or the Warrant Agent in respect of the issuance or delivery of shares of Common Stock upon the exercise of Warrants,
but the Company shall not be obligated to pay any transfer taxes in respect of the Warrants or such shares.

 

7.2
  Resignation, Consolidation, or Merger of Warrant Agent.

 

7.2.1
  Appointment of Successor Warrant Agent. The Warrant Agent, or any successor to it hereafter appointed, may resign
its duties and be discharged from all further duties and liabilities hereunder after giving sixty (60) days’ notice in writing
to the Company. If the office of the Warrant Agent becomes vacant by resignation or incapacity to act or otherwise, the Company
shall appoint in writing a successor Warrant Agent in place of the Warrant Agent. If the Company shall fail to make such appointment
within a period of 30 days after it has been notified in writing of such resignation or incapacity by the Warrant Agent or by
the holder of the Warrant (who shall, with such notice, submit his Warrant for inspection by the Company), then the holder of
any Warrant may apply to a court of competent jurisdiction for the appointment of a successor Warrant Agent. Any successor Warrant
Agent, whether appointed by the Company or by such court, shall be authorized to exercise corporate trust powers and subject to
supervision or examination by federal or state authority. After appointment, any successor Warrant Agent shall be vested with
all the authority, powers, rights, immunities, duties, and obligations of its predecessor Warrant Agent with like effect as if
originally named as Warrant Agent hereunder, without any further act or deed; but if for any reason it becomes necessary or appropriate,
the predecessor Warrant Agent shall execute and deliver, at the expense of the Company, an instrument transferring to such successor
Warrant Agent all the authority, powers, and rights of such predecessor Warrant Agent hereunder; and upon request of any successor
Warrant Agent the Company shall make, execute, acknowledge, and deliver any and all instruments in writing for more fully and
effectually vesting in and confirming to such successor Warrant Agent all such authority, powers, rights, immunities, duties,
and obligations.

 

 7.2.2
  Notice of Successor Warrant Agent. In the event a successor Warrant Agent shall be appointed, the Company shall
give notice thereof to the predecessor Warrant Agent and the transfer agent for the Common Stock not later than the effective
date of any such appointment.

 

7.2.3
  Merger or Consolidation of Warrant Agent. Any corporation into which the Warrant Agent may be merged or with which
it may be consolidated or any corporation resulting from any merger or consolidation to which the Warrant Agent shall be a party
shall be the successor Warrant Agent under this Agreement without any further act.

 

7.3
  Fees and Expenses of Warrant Agent.

 

7.3.1
  Remuneration. The Company agrees to pay the Warrant Agent reasonable remuneration for its services as such Warrant
Agent hereunder as set forth on Exhibit B hereto, and will reimburse the Warrant Agent upon demand for all
expenditures that the Warrant Agent may reasonably incur in the execution of its duties hereunder.

 

    7

     

    

 

7.3.2
  Further Assurances. The Company agrees to perform, execute, acknowledge, and deliver or cause to be performed, executed,
acknowledged, and delivered all such further and other acts, instruments, and assurances as may reasonably be required by the
Warrant Agent for the carrying out or performing of the provisions of this Warrant Agreement.

 

7.4
  Liability of Warrant Agent.

 

7.4.1
  Reliance on Company Statement. Whenever in the performance of its duties under this Agreement, the Warrant Agent
shall deem it necessary or desirable that any fact or matter be proved or established by the Company prior to taking or suffering
any action hereunder, such fact or matter (unless other evidence in respect thereof be herein specifically prescribed) may be
deemed to be conclusively proved and established by a statement signed by the Chief Executive Officer, President, Chief Operating
Officer, Chief Financial Officer, Executive Vice President, Treasurer, or Secretary of the Company and delivered to the Warrant
Agent. The Warrant Agent may rely upon such statement for any action taken or suffered in good faith by it pursuant to the provisions
of this Agreement.

  

7.4.2
  Indemnity. The Warrant Agent shall be liable hereunder only for its own gross negligence, willful misconduct or
bad faith. The Company agrees to indemnify the Warrant Agent and save it harmless against any and all liabilities, including judgments,
costs and reasonable counsel fees, for anything done or omitted by the Warrant Agent in the execution of this Agreement except
as a result of the Warrant Agent’s gross negligence, willful misconduct, or bad faith.

 

7.4.3
  Exclusions. The Warrant Agent shall have no responsibility with respect to the validity of this Agreement or with
respect to the validity or execution of any Warrant (except its countersignature thereof); nor shall it be responsible for any
breach by the Company of any covenant or condition contained in this Agreement or in any Warrant; nor shall it be responsible
to make any adjustments required under the provisions of Section 4 hereof or responsible for the manner, method, or amount of
any such adjustment or the ascertaining of the existence of facts that would require any such adjustment; nor shall it by any
act hereunder be deemed to make any representation or warranty as to the authorization or reservation of any shares of Common
Stock to be issued pursuant to this Agreement or any Warrant or as to whether any shares of Common Stock will when issued be valid
and fully paid and nonassessable.

  

7.5
  Acceptance of Agency. The Warrant Agent hereby accepts the agency established by this Agreement and agrees to perform
the same upon the terms and conditions herein set forth and among other things, shall account promptly to the Company with respect
to Warrants exercised and concurrently account for, and pay to the Company, all moneys received by the Warrant Agent for the purchase
of shares of the Company’s Common Stock through the exercise of Warrants.

 

7.6
  Waiver. The Warrant Agent hereby waives any and all right, title, interest or claim of any kind (“Claim”)
in or to any distribution of any account in which funds related to the purchase or exercise of the Warrants are held, and hereby
agrees not to seek recourse, reimbursement, payment or satisfaction for any Claim against any such account for any reason whatsoever.

 

8.
  Miscellaneous Provisions.

 

8.1
  Successors. All the covenants and provisions of this Agreement by or for the benefit of the Company or the Warrant
Agent shall bind and inure to the benefit of their respective successors and assigns.

 

    8

     

    

 

8.2
  Notices. Any notice or other communication required or which may be given hereunder shall be in writing and either
be delivered personally or by private national courier service, or be mailed, certified or registered mail, return receipt requested,
postage prepaid, and shall be deemed given when so delivered personally or, if sent by private national courier service, on the
next business day after delivery to the courier, or, if mailed, two business days after the date of mailing, as follows:

 

Zion
Oil & Gas, Inc.

12655
North Central Expressway, Suite 1000

Dallas,
Texas 75243

Attn:
 Corporate Secretary/Treasurer

 

Any
notice, statement or demand authorized by this Agreement to be given or made by the holder of any Warrant or by the Company to
or on the Warrant Agent shall be sufficiently given when so delivered if by hand or overnight delivery or if sent by certified
mail or private courier service five days after deposit of such notice, postage prepaid, addressed (until another address is filed
in writing by the Warrant Agent with the Company), as follows:

 
 

American
Stock Transfer & Trust Company, LLC

6201
15th Avenue

Brooklyn,
New York 11219

Attn:
Account Executive

 

8.3
  Applicable Law. The validity, interpretation, and performance of this Agreement and of the Warrants shall be governed
in all respects by the laws of the State of New York, without giving effect to conflict of laws. Each party hereby agrees that
any action, proceeding or claim against it arising out of or relating in any way to this Agreement shall be brought and enforced
in the appropriate state or federal courts in the State of New York, and irrevocably submits to such jurisdiction, which jurisdiction
shall be exclusive. Each party hereby waives any objection to such exclusive jurisdiction and that such courts represent an inconvenient
forum.

 

8.4
  Persons Having Rights under this Warrant Agreement. Nothing in this Agreement expressed and nothing that may be
implied from any of the provisions hereof is intended, or shall be construed, to confer upon, or give to, any person or corporation
other than the parties hereto and the registered holders of the Warrants, any right, remedy, or claim under or by reason of this
Agreement or of any covenant, condition, stipulation, promise, or agreement hereof. All covenants, conditions, stipulations, promises,
and agreements contained in this Agreement shall be for the sole and exclusive benefit of the parties hereto and their successors
and assigns and of the registered holders of the Warrants. 

 

 8.5
  Examination of the Warrant Agent Agreement. A copy of this Agreement shall be available at all reasonable times
at the office of the Warrant Agent for inspection by the registered holder of any Warrant. The Warrant Agent may require any such
holder to submit his Warrant for inspection by it.

 

8.6
  Counterparts. This Agreement may be executed in any number of counterparts and each of such counterparts shall for
all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.

 

8.7
  Effect of Headings. The Section headings herein are for convenience only and are not part of this Agreement and
shall not affect the interpretation thereof.

 

8.8
  Amendments. This Agreement may be amended by the parties hereto without the consent of any registered holder for
the purpose of curing any ambiguity, or of curing, correcting or supplementing any defective provision contained herein or adding
or changing any other provisions, including the shortening of the Exercise Period pursuant to Section 3.2, with respect to matters
or questions arising under this Agreement as the parties may deem necessary or desirable and that the parties deem shall not adversely
affect the interest of the registered holders. All other modifications or amendments, including any amendment to increase the
Warrant Price, shall require the written consent of a majority of the then outstanding Warrants. Notwithstanding the foregoing,
the Company may lower the Warrant Price or extend or reduce the duration of the Exercise Period in accordance with Sections 3.1
and 3.2, respectively, without such consent.

 

8.9
  Severability. This Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision
hereof shall not affect the validity or enforceability of this Agreement or of any other term or provision hereof. Furthermore,
in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part
of this Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible and be valid and
enforceable.

 

    9

     

    

 

IN
WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto effective as of the day and year first above written.

 

	ZION OIL & GAS, INC.	 
	 	 	 
	By:	/s/
    Martin M. van Brauman	 
	Name: 	Martin M. van Brauman	 
	Title:	Corporate Secretary, Treasurer, SVP, Director	 
	 	 	 
	Date: 	February 1, 2018	 
	 	 	 
	AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC	 
	 	 	 
	By:	/s/
    Paula Caroppoli	 
	Name:	Paula Caroppoli	 
	Title:  	Senior Vice President	 
	 	 	 
	Date: 	February 1, 2018	 

 

    10

     

    

 

Exhibit
A

 

[Face
of Certificate - ZION OIL & GAS, INC.]

 

(SEE
REVERSE SIDE FOR LEGEND)

 

W

 

WARRANTS

 

(THIS
WARRANT WILL BE VOID IF NOT EXERCISED PRIOR TO 5:00 P.M., EASTERN STANDARD TIME, _______, 2019)

 

ZION
OIL & GAS, INC.

 

CUSIP
989696 ___

 

WARRANT

 

THIS
CERTIFIES THAT, for value received _____________ is the registered holder of a Warrant or Warrants expiring __________, 2019 (the
“Warrant”) to purchase for each Warrant one fully paid and non-assessable share of Common Stock, par value $.01 per
share (the “Shares”), of ZION OIL & GAS, INC., a Delaware corporation (the “Company”). Each Warrant entitles
the holder thereof to purchase from the Company, commencing on _______, 2018, one Share of the Company at the price of $5.00 per
share, upon surrender of this Warrant Certificate and payment of the Warrant Price at the office or agency of the Warrant Agent,
American Stock Transfer & Trust Company, LLC (such surrender may be made by electronic means and such payment by check or
by electronic means made payable to the order of the Company), but only subject to the conditions set forth herein and in the
Warrant Agent Agreement between the Company and the Warrant Agent. In no event shall the registered holder of this Warrant be
entitled to receive a net-cash settlement or other consideration in lieu of physical settlement in Shares of the Company. The
Warrant Agent Agreement provides that, upon the occurrence of certain events, the Warrant Price, the Exercise Period and the number
of Warrant Shares purchasable hereunder, set forth on the face hereof, may, subject to certain conditions, be adjusted. The term
Warrant Price as used in this Warrant Certificate refers to the price per Share at which Shares may be purchased at the time the
Warrant is exercised.

 

This
Warrant may expire on the date first above written, if it is not exercised prior to such date by the registered holder pursuant
to the terms of the Warrant Agent Agreement. The Company in its sole discretion may extend the duration of the Unit Option under
the Unit Program, which would extend the Warrant Exercise Period by the same extension of days.

 

Upon
any exercise of the Warrant for less than the total number of full Shares provided for herein, there shall be issued to the registered
holder hereof or his/her/its assignee a new Warrant Certificate covering the number of Shares for which the Warrant has not been
exercised.

 

Warrant
Certificates, when surrendered at the office or agency of the Warrant Agent or by any electronic means to the Company by the registered
holder hereof in person or by attorney duly authorized in writing, may be exchanged in the manner and subject to the limitations
provided in the Warrant Agent Agreement, but without payment of any service charge, for another Warrant Certificate or Warrant
Certificates of like tenor and evidencing in the aggregate a like number of Warrants.

 

Upon
due presentment by electronic means or other approved delivery for registration of transfer of the Warrant Certificate at the
office or agency of the Warrant Agent, a new Warrant Certificate or Warrant Certificates of like tenor and evidencing in the aggregate
a like number of Warrants shall be issued to the transferee in exchange for this Warrant Certificate, subject to the limitations
provided in the Warrant Agent Agreement, without charge except for any applicable tax or other governmental charge.

 

The
Company and the Warrant Agent may deem and treat the registered holder as the absolute owner of the Warrants represented by this
Warrant Certificate (notwithstanding any notation of ownership or other writing hereon made by anyone) for the purpose of any
exercise hereof, of any distribution to the registered holder, and for all other purposes, and neither the Company nor the Warrant
Agent shall be affected by any notice to the contrary.

 

    11

     

    

 

This
Warrant does not entitle the registered holder to any of the rights of a stockholder of the Company.

 

 

COUNTERSIGNED:

American
Stock Transfer & Trust Company, LLC

 

WARRANT
AGENT

BY:

AUTHORIZED
OFFICER

 

DATED:

 

(Signature)

CHIEF
EXECUTIVE OFFICER

 

(Seal)

 

(Signature)

SECRETARY

 

 

12ex_103999.htm

Exhibit 4.1

 

THIS WARRANT AND THE COMMON STOCK SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”). THIS WARRANT AND THE COMMON STOCK SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO ACCELERIZE INC. THAT SUCH REGISTRATION IS NOT REQUIRED.

 

	
			  

				
			Right to Purchase up to 7,000,000 shares of Common Stock of Accelerize Inc. (subject to adjustment as provided herein)

			

 

COMMON STOCK PURCHASE WARRANT

 

	
			No. BC -01

				
			 Issue Date: January 25, 2018

			

 

ACCELERIZE INC., a corporation organized and existing under the laws of the State of Delaware (the “Company”), hereby certifies that, for value received, Beedie Investments Limited or its permitted assigns (the “Holder”) is entitled, subject to the terms set forth below, to purchase from the Company at any time after January 25, 2018 (the “Issue Date”) until 5:00 p.m., Eastern Time, on the sixth (6th) anniversary of the Issue Date (the “Expiration Date”), up to that number of Warrant Shares set forth on Schedule 1 hereto (subject to adjustment pursuant to the terms hereof), at a per share purchase price of $0.35. The aforementioned purchase price per share, as adjusted from time to time as herein provided, is referred to herein as the “Purchase Price.” The number and character of such shares of Common Stock and the Purchase Price are subject to adjustment as provided herein. The Company may reduce the Purchase Price without the consent of the Holder.

 

This warrant to purchase Common Stock (“Warrant”) is issued in connection with and pursuant to that certain Credit Agreement dated as of January 25, 2018 (the “Credit Agreement”), by and between the Company and Holder. 

 

As used herein the following terms, unless the context otherwise requires, have the following respective meanings:

 

(a) The term “Business Day” means any day that is not a Saturday, Sunday or a statutory holiday in the Province of British Columbia or the State of California.

 

(b) The term “Company” shall include Accelerize Inc. and any corporation which shall succeed or assume the obligations of Accelerize Inc. hereunder. 

 

(c) The term “Common Stock” includes (i) the Company’s Common Stock, $0.001 par value per share, and (ii) any other securities into which or for which any of the securities described in (i) may be converted or exchanged pursuant to a plan of recapitalization, reorganization, merger, sale of assets or otherwise.

 

(d) The term “Material Event” means any of the following:

 

 

 

 

(i) any dividend or distribution in respect of the outstanding shares of Common Stock;

 

(ii) any offer for subscription or sale pro rata to all holders of the outstanding Common Stock any additional shares of any class or series of the Company’s capital stock;

 

(iii) any reclassification, exchange, combination, substitution, reorganization or recapitalization of the outstanding Common Stock;

 

(iv) (a) any Person, or group of Persons acting jointly or in concert, becoming the beneficial owner, directly or indirectly, of 50% or more of the combined voting power of the then outstanding voting securities of the Company, (b) a transaction occurring which results in the stockholders of the Company immediately before the transaction owning, as a group, 50% or less of the outstanding shares of the Company or any successor entity after such transaction or (c) the sale, lease, exclusive license or other disposition of all or substantially all of the assets of the Company; or

 

(v) the winding-up, dissolution or liquidation of the Company.

 

(e) The term “Other Securities” refers to any stock (other than Common Stock) or other securities of the Company or any other Person which the holder of the Warrant at any time shall be entitled to receive, or shall have received, on the exercise of the Warrant, in lieu of or in addition to Common Stock, or which at any time shall be issuable or shall have been issued in exchange for or in replacement of Common Stock or Other Securities pursuant to the terms herein. 

 

(f) The term “Person” means an individual, partnership, limited partnership, limited liability partnership, limited liability company, corporation, trust or unincorporated organization.

 

(g) The term “Trading Market” means the following markets or exchanges on which the Company’s Common Stock is listed or quoted for trading on the date in question: the Nasdaq Capital Market, the NYSE Amex, the New York Stock Exchange, the Nasdaq Global Market, the Nasdaq Global Select Market, the OTC Bulletin Board, the Toronto Stock Exchange or a nationally recognized stock exchange in Canada. 

 

(h) The term “VWAP” means for any date, the price determined by the first of the following clauses that applies: (A) if the shares are then listed or quoted on a Trading Market, the daily volume weighted average price per share for such date (or the nearest preceding date) on the Trading Market on which the Shares are then listed or quoted as reported by Bloomberg Financial L.P. (based on a Trading Day from 9:35 a.m. Eastern Time to 3:58 p.m. Eastern Time); (B) if the shares are not then listed or quoted on a Trading Market and if prices for the shares are then quoted on the OTC Bulletin Board, the volume weighted average price per share of the Shares for such date (or the nearest preceding date) on the OTC Bulletin Board; or (C) if the shares are not then listed or quoted on the OTC Bulletin Board and if prices for the shares are then reported in the “Pink Sheets” published by the Pink OTC Markets Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the shares so reported.

 

 

 

 

(i) The term “Warrant Shares” shall mean the fully paid and nonassessable shares of Common Stock issuable upon exercise of this Warrant.

 

1.     Exercise of Warrant.

 

1.1.     Number of Shares Issuable upon Exercise. From and after the Issue Date through and including the Expiration Date, the Holder hereof shall be entitled to receive, upon exercise of this Warrant in whole in accordance with the terms of Section 1.2 or upon exercise of this Warrant in part in accordance with Section 1.3, up to that number of Warrant Shares set forth on Schedule 1 hereto, subject to adjustment pursuant to the terms hereof.

 

1.2.     Full Exercise. This Warrant may be exercised in full by the Holder hereof by delivery to the Company or Warrant Agent (as provided hereinafter) of an original or facsimile copy (or email attachment) of the form of subscription attached as hereto Exhibit A (the “Subscription Form”) duly executed by such Holder, and, subject to Section 11 below, accompanied by payment, in cash, wire transfer or by certified or official bank check payable to the order of the Company, in the amount obtained by multiplying the number of shares of Common Stock for which this Warrant is then exercisable by the Purchase Price then in effect (the “Full Exercise Price”). 

 

1.3.     Partial Exercise. This Warrant may be exercised in part (but not for a fractional share) by delivery of the Subscription Form as provided in Section 1.2 except that the amount payable by the Holder on such partial exercise shall be the amount obtained by multiplying (a) the number of whole shares of Common Stock designated by the Holder in the Subscription Form by (b) the Purchase Price then in effect (the “Partial Exercise Price”). On any such partial exercise, the Company, at its expense, will forthwith issue and deliver to or upon the order of the Holder hereof a new Warrant of like tenor, in the name of the Holder hereof or as such Holder (upon payment by such Holder of any applicable transfer taxes) may request, the whole number of shares of Common Stock for which such Warrant may still be exercised.

 

1.4.     Fair Market Value. “Fair Market Value” of a share of Common Stock as of a particular date shall mean: 

 

(a)     If the Company’s Common Stock is publicly traded, then the arithmetic average of the VWAP of such shares for each of the five (5) consecutive trading days ending on the date immediately preceding the date of the exercise of this Warrant;

 

(b)     Except as provided in clause (c) below, if the Company’s Common Stock is not publicly traded, then as the Holder and the Company agree in writing, or in the absence of such agreement, by arbitration in accordance with the rules then standing of the American Arbitration Association, before a single arbitrator to be chosen from a panel of persons qualified by education and training to pass on the matter to be decided; or

 

(c)     If the date of the exercise of this Warrant is the date of a liquidation, dissolution or winding up, or any event deemed to be a liquidation, dissolution or winding up pursuant to the Company’s charter, then all amounts to be payable per share to holders of the Common Stock pursuant to the charter in the event of such liquidation, dissolution or winding up, plus all other amounts to be payable per share in respect of the Common Stock in liquidation under the charter, assuming for the purposes of this clause (c) that all of the shares of Common Stock then issuable upon exercise of all warrants are outstanding at the date of the exercise of this Warrant.

 

 

 

 

1.5.     Company Acknowledgment. The Company will, at the time of the exercise of the Warrant, upon the request of the Holder hereof acknowledge in writing its continuing obligation to afford to such Holder any rights to which such Holder shall continue to be entitled after such exercise in accordance with the provisions of this Warrant. If the Holder shall fail to make any such request, such failure shall not affect the continuing obligation of the Company to afford to such Holder any such rights.

 

1.6.     Delivery of Stock Certificates, etc. on Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted by the Company’s transfer agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository Trust Company through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by Holder or (B) this Warrant is being exercised via cashless exercise, and otherwise by physical delivery of a certificate, registered in the Company’s share register in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder in the Notice of Exercise by the date that is the earlier of (i) the earlier of (A) two (2) trading days after the delivery to the Company of the Subscription Form and (B) one (1) trading day after delivery of the aggregate Full Exercise Price or Partial Exercise Price (as applicable) and (ii) the number of trading days comprising the Standard Settlement Period (such date, the “Warrant Share Delivery Date”). Upon delivery of the Subscription Form, the Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date of delivery of the Warrant Shares, provided that payment of the Full Exercise Price or Partial Exercise Price (as applicable) (other than in the case of a cashless exercise) is received within the earlier of (i) two (2) trading days and (ii) the number of trading days comprising the Standard Settlement Period following delivery of the Subscription Form. As used herein, “Standard Settlement Period” means the standard settlement period, expressed in a number of trading days, on the Company’s primary Trading Market with respect to the Common Stock as in effect on the date of delivery of the Subscription Form. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant. In lieu of any fractional share to which such Holder would otherwise be entitled upon exercise, Holder shall receive cash equal to such fraction multiplied by the then Fair Market Value of one full share of Common Stock, together with any other stock or other securities and property (including cash, where applicable) to which such Holder is entitled upon such exercise pursuant to Section 1 or otherwise.

 

1.7     No Delivery of Warrant on Exercise. The Holder shall not be required to deliver the original Warrant in order to effect an exercise hereunder. Execution and delivery of the Subscription Form shall have the same effect as cancellation of the original Warrant and issuance of a new Warrant evidencing the right to purchase the remaining number of Warrant Shares. The Holder shall deliver the original Warrant to the Company within thirty (30) days after the full exercise of this Warrant, provided, that the Holder’s failure to so deliver the original Warrant shall not affect the validity of such exercise or any of the Company’s obligations under this Warrant and the Company’s sole remedy for the Holder’s failure to deliver the original Warrant shall be to obtain an affidavit of lost warrant and customary indemnity and security reasonably satisfactory in form and amount to the Company from the Holder. 

 

 

 

 

2.     Adjustments.

 

2.1.     Reorganization, Consolidation, Merger, etc. In case at any time or from time to time, the Company shall (a) effect a reorganization, (b) consolidate or amalgamate with or merge into any other Person or (c) directly or indirectly transfer, lease, exclusively license or otherwise dispose of all or substantially all of its properties or assets to any other Person under any plan or arrangement contemplating the dissolution of the Company, then, in each such case, as a condition to the consummation of such a transaction, proper and adequate provision shall be made by the Company whereby the Holder of this Warrant, on the exercise hereof as provided in Section 1, at any time after the consummation of such reorganization, consolidation, amalgamation or merger or the effective date of such dissolution, as the case may be, shall receive, in lieu of the Common Stock (or Other Securities) issuable on such exercise prior to such consummation or such effective date, the stock and other securities and property (including cash) to which such Holder would have been entitled upon such consummation or in connection with such dissolution, as the case may be, if such Holder had so exercised this Warrant, immediately prior thereto, all subject to further adjustment thereafter as provided in Section 3.

 

2.2.     Dissolution. In the event of any dissolution of the Company following the transfer of all or substantially all of its properties or assets, the Company, prior to such dissolution, shall at its expense deliver or cause to be delivered the stock and other securities and property (including cash, where applicable) receivable in accordance with Section 2.1 by the Holder of the Warrants upon their exercise after the effective date of such dissolution pursuant to this Section 2. 

 

2.3.     Continuation of Terms. Upon any reorganization, consolidation, amalgamation, merger or transfer (and any dissolution following any transfer) referred to in this Section 2, this Warrant shall continue in full force and effect and the terms hereof shall be applicable to the Other Securities and property receivable on the exercise of this Warrant after the consummation of such reorganization, consolidation or merger or the effective date of dissolution following any such transfer, as the case may be, and shall be binding upon the issuer of any Other Securities, including, in the case of any such transfer, the Person acquiring all or substantially all of the properties or assets of the Company, whether or not such Person shall have expressly assumed the terms of this Warrant. 

 

2.4     No Impairment. The Company shall not, by amendment of its charter or other constating documents, or through a reorganization, transfer of assets, consolidation, merger, arrangement, amalgamation, 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 under this Warrant by the Company, but shall at all times in good faith assist in carrying out all the provisions hereof and in taking all such actions as may be necessary or appropriate to protect the Holder’s right hereunder against dilution or other impairment.

 

3.     Extraordinary Events Regarding Common Stock. 

 

 

 

 

3.1    Dividends and Distributions; Subdivisions and Consolidations. In the event that the Company shall (a) issue additional shares of Common Stock as a dividend or other distribution on outstanding Common Stock, (b) subdivide its outstanding shares of Common Stock, or (c) combine its outstanding shares of the Common Stock into a smaller number of shares of the Common Stock, then, in each such event, the Purchase Price shall, simultaneously with the happening of such event, be adjusted by multiplying the then Purchase Price by a fraction, the numerator of which shall be the number of shares of Common Stock outstanding immediately prior to such event and the denominator of which shall be the number of shares of Common Stock outstanding immediately after such event, and the product so obtained shall thereafter be the Purchase Price then in effect. The Purchase Price, as so adjusted, shall be readjusted in the same manner upon the happening of any successive event or events described herein in this Section 3.1. The number of shares of Common Stock that the Holder of this Warrant shall thereafter, on the exercise hereof as provided in Section 1, be entitled to receive shall be adjusted to a number determined by multiplying the number of shares of Common Stock that would otherwise (but for the provisions of this Section 3.1) be issuable on such exercise by a fraction of which (a) the numerator is the Purchase Price that would otherwise (but for the provisions of this Section 3) be in effect, and (b) the denominator is the Purchase Price in effect on the date of such exercise.

 

3.2     Issuance of Additional Shares. If the Company shall issue shares of Common Stock before the first (1st) anniversary of the Issue Date without consideration or for a consideration per share less than the Purchase Price, the Purchase Price shall be reduced, concurrently with such issue, to a price (calculated to the nearest cent) determined by multiplying the Purchase Price then in effect by a fraction, (i) the numerator of which shall be the number of shares of Common Stock outstanding immediately prior to such issue plus the number of shares of Common Stock which the aggregate consideration received by the Company for the total number of shares of Common Stock so issued would purchase at the Purchase Price in effect immediately prior to such issue, and (ii) the denominator of which shall be the number of shares of Common Stock outstanding immediately prior to such issue plus the number of such shares of Common Stock so issued; provided that, immediately after any shares of Common Stock are deemed issued pursuant to this Section 3.2 such shares of Common Stock shall be deemed to be outstanding. For the purposes of calculating any adjustment to the Purchase Price under this Section 3.2, all shares of Common Stock issuable upon exercise, conversion or exchange of outstanding convertible securities shall be deemed to be outstanding. Notwithstanding the foregoing, no adjustment to the Purchase Price or number of Warrant Shares shall be triggered pursuant to this Section 3.2 by (i) the issuance of ordinary course stock options or share-based compensation to directors, officers, employees or other service providers when issued pursuant to the Company’s existing compensation plans or consistent with past practice, to a maximum of 10% of the Company’s issued and outstanding shares of Common Stock on a fully diluted basis at such time; or (ii) shares of Common Stock issued upon the exercise, conversion or exchange of any convertible security issued prior to the date hereof.

 

4.     Certificate as to Adjustments. In each case of any adjustment or readjustment in the shares of Common Stock (or Other Securities) issuable on the exercise of the Warrants, the Company at its expense will promptly cause its Chief Financial Officer or other appropriate designee to compute such adjustment or readjustment in accordance with the terms of the Warrant and prepare a certificate setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment or readjustment is based, including a statement of (a) the consideration received or receivable by the Company for any additional shares of Common Stock (or Other Securities) issued or sold or deemed to have been issued or sold, (b) the number of shares of Common Stock (or Other Securities) outstanding or deemed to be outstanding, and (c) the Purchase Price and the number of shares of Common Stock to be received upon exercise of this Warrant, in effect immediately prior to such adjustment or readjustment and as adjusted or readjusted as provided in this Warrant. The Company will forthwith mail a copy of each such certificate to the Holder of the Warrant and any Warrant Agent of the Company (appointed pursuant to Section 7 hereof).

 

 

 

 

5.     Representations and Covenants of the Company.

 

5.1    The Company hereby represents and warrants that it is authorized to create and issue the Warrant and that this Warrant is a valid and enforceable obligation of the Company, enforceable in accordance with the provisions of this Warrant Certificate. 

 

5.2    The Company will at all times reserve and keep available, solely for issuance and delivery on the exercise of the Warrant, all shares of Common Stock (or Other Securities) from time to time issuable on the exercise of the Warrant, and hereby represents and warrants that all Warrant Shares issued upon the exercise of the Warrant will, upon payment of the Purchase Price therefor by the Holder, be fully paid and non-assessable and duly and validly issued.

 

5.3    The Company shall give Holder notice of a Material Event at the same time and in the same manner as the Company notifies the holders of the outstanding Common Stock; provided, that at all times, if any, when the Company shall not be subject to the reporting requirements of Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as amended, the Company shall furnish the Holder with:

 

(a)     notice of such Material Event not less than 10 Business Days prior to the earlier to occur of the anticipated effective date thereof or the record date for any dividend, distribution, or subscription rights or for determining rights to vote, if any, in each case together with such information as the Holder may reasonably require regarding the treatment of this Warrant in connection with the Material Event giving rise to such notice;

               (b)     such additional information as is furnished or required to be furnished to all or any shareholders of the Company, whether pursuant to the Company’s charter or other constating documents, any shareholder, investor rights or similar agreement, or applicable corporate or securities laws or stock exchange rules or policies.

 

6.     Replacement of Warrant. On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of any such loss, theft or destruction of this Warrant, on delivery of an indemnity agreement and security reasonably satisfactory in form and amount to the Company or, in the case of any such mutilation, on surrender and cancellation of this Warrant, the Company at its expense, once only and then at the expense of the Holder, will execute and deliver, in lieu thereof, a new Warrant of like tenor.

 

7.     Warrant Agent. The Company may, by written notice to the Holder of the Warrant, appoint an agent (a “Warrant Agent”) for the purpose of issuing Common Stock (or Other Securities) on the exercise of this Warrant pursuant to Section 1, and replacing this Warrant pursuant to Section 6, or any of the foregoing, and thereafter any such issuance or replacement, as the case may be, shall be made at such office by such Warrant Agent. 

 

 

 

 

8.     Transfer on the Company’s Books. Until this Warrant is transferred on the books of the Company, the Company may treat the registered holder hereof as the absolute owner hereof for all purposes, notwithstanding any notice to the contrary. 

 

9.     Notices. All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted by hand delivery or facsimile, addressed as set forth below or to such other address as such party shall have specified most recently by written notice. Any notice or other communication required or permitted to be given hereunder shall be deemed effective (a) upon hand delivery or delivery by facsimile, with accurate confirmation generated by the transmitting facsimile machine, at the address or number designated below (if delivered on a Business Day during normal business hours where such notice is to be received), or the first Business Day following such delivery (if delivered other than on a Business Day during normal business hours where such notice is to be received) or (b) on the Business Day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur or (c) three Business Days after deposited in the mail if delivered pursuant to clause (ii) above. The addresses for such communications shall be: (i) if to the Company to: 20411 SW Birch St. Ste. 250, Newport Beach, CA 92660, and (ii) if to the Holder, to: Suite 1730, 1111 West Georgia Street, Vancouver, BC V6E 4M3, Canada, or if subsequently updated, the address in the Company books. The Company may change its address for notices but only to an address and fax number located in the United States.

 

10.    No Assignment. Holder shall not be permitted to sell, assign, hypothecate, pledge, dispose or otherwise transfer this Warrant or the rights and obligations hereunder, or any Warrant Shares acquired upon exercise hereunder, except to an affiliate or to a syndicate member under the Credit Agreement without the prior written consent of Company. Any prohibited assignment shall be null and void. 

 

11.    Notice of Expiration. The Company shall give notice of the Expiration Date (the “Expiration Notice”) to the Holder within ninety (90) but not less than thirty (30) days before the Expiration Date. If the Company does not deliver the Expiration Notice within ninety (90) but not less than thirty (30) days before the Expiration Date and the Fair Market Value of one share of Common Stock is greater than the Purchase Price in effect on the Expiration Date, then, subject to any determination of Fair Market Value required pursuant to Section 1.4(b), this Warrant shall automatically be deemed on and as of the Expiration Date to be exercised pursuant to Section 1.2 or Section 1.3, as applicable, as to all Warrant Shares for which it shall not previously have been exercised, and the Company shall deliver a certificate representing the Warrant Shares issued upon such exercise to the Holder in accordance with Section 1.6. In lieu of payment of the Full Exercise Price or the Partial Exercise Price in the manner as specified in Section 1.2 or Section 1.3, as applicable, but otherwise in accordance with the requirements of such Section, the Company shall issue to the Holder such number of Warrant Shares as is computed using the following formula: 

 

X                 =                Y(A-B)/A

 

 

 

where:

 

 

 

 

	X	=	the number of Warrant Shares to be issued to the Holder;
	 	 	 
	Y	=	the number of Warrant Shares with respect to which this Warrant is being exercised (inclusive of the Warrant Shares surrendered to the Company in payment of the Full Exercise Price or Partial Exercise Price, as applicable);
	 	 	 
	A	=	the Fair Market Value of a share of Common Stock; and
	 	 	 
	B	=	the Purchase Price.

   

  

11.    Miscellaneous. This Warrant and any term hereof may be changed, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of such change, waiver, discharge or termination is sought. This Warrant shall be construed and enforced in accordance with and governed by the laws of the State of New York. Any dispute relating to this Warrant shall be adjudicated in any state court in New York County in the State of New York or in the U.S. District Court for the Southern District of New York. The headings in this Warrant are for purposes of reference only, and shall not limit or otherwise affect any of the terms hereof. The invalidity or unenforceability of any provision hereof shall in no way affect the validity or enforceability of any other provision. By acceptance of this Warrant, Holder acknowledges that it is either an “accredited investor” as defined in Rule 501(a) under the Securities Act or (ii) a “qualified institutional buyer” as defined in Rule 144A(a) under the Securities Act.

 

 

 

 

IN WITNESS WHEREOF, the Company has executed this Warrant as of the date first written above.

 

	
			 

				
			ACCELERIZE INC.

			
	
			 

				
			 

			
	
			 

				
			 

			
	
			 

				
			By:                                                  

			 

			Name: Brian Ross

			Title: Chief Executive Officer and President    

			

 

 

 

 

 

 

Schedule 1 to Common Stock Purchase Warrant

 

Warrant Shares: Up to 7,000,000 Warrant Shares, based on the principal amount loaned under the Credit Agreement, calculated as 1 Warrant Share per each $1.00 in principal loaned. By way of example only, if $4,500,000 is loaned under the Credit Agreement, then the number of Warrant Shares underlying the Warrant shall equal 4,500,000. And, if an additional $2,000,000 is later loaned under the Credit Agreement, then the number of Warrant Shares shall be increased by 2,000,000 Warrant Shares, for an aggregate of 6,500,000 Warrant Shares. All numbers of Warrant Shares shall be subject to adjustment as set forth in the Warrant.

 

 

 

 

  

Exhibit A

FORM OF SUBSCRIPTION

(to be signed only on exercise of Warrant)

TO:     ACCELERIZE INC. 

 

The undersigned, pursuant to the provisions set forth in the attached Warrant (No.____), hereby irrevocably elects to purchase (check applicable box):

 

___     ________ shares of the Common Stock covered by such Warrant; or

 

 

Purchase Terms:

 

___ The undersigned herewith makes payment of the full purchase price for such shares at the price per share provided for in such Warrant, which is $___________.

 

 

The undersigned requests that the certificates for such shares be issued in the name of, and delivered to                                                  whose address is__________________________________________________________________________

 

The undersigned represents and warrants that all offers and sales by the undersigned of the securities issuable upon exercise of the within Warrant shall be made pursuant to registration of the Common Stock under the Securities Act, or pursuant to an exemption from registration under the Securities Act.

 

Dated:                              

 

	
			 

				
			 

			
	
			 

				
			(Signature must conform to name of holder

			as specified on the fact of the Warrant.)

			
	
			 

				
			 

			
	
			 

				
			 

			
	
			 

				
			 

			
	
			 

				
			(Address)

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