Document:

ex_10-22.htm

    
      

      

    

    EXHIBIT
10.22

     

     

    STOCK
AND WARRANT PURCHASE AGREEMENT

     

    THIS
STOCK AND WARRANT PURCHASE AGREEMENT (this “Agreement”) is made on the 28th day
of August, 2008, by and among BALQON CORPORATION, a California corporation (the
“Company”), and MARLIN FINANCIAL GROUP, INC. (the “Investor”).

     

    THE
PARTIES HEREBY AGREE AS FOLLOWS:

     

    1. Purchase and Sale of Stock
and Warrants

     

    1.1 Sale and Issuance of Stock
and Warrants

     

    (a)
Subject to the terms and conditions of this Agreement, the Investor agrees to
purchase at the Closing, and the Company agrees to sell and issue to the
Investor at the Closing, Two Million Nine Hundred Sixteen Thousand Seven Hundred
Twenty-Five (2,916,725) shares (the “Issue Shares”) of the no par value common
stock of the Company (the “Common Stock”).

     

    (b)
Subject to the terms and conditions of this Agreement, the Investor agrees to
purchase at the Closing, and the Company agrees to sell and issue to the
Investor at the Closing, warrants to purchase up to Seven Hundred Twenty-Nine
Thousand One Hundred Eighty (729,180) shares of the Common Stock (the
“Warrants;” collectively with the Issue Shares and the Warrant Shares, as
defined in section 1.3 of the Agreement, the “Shares”) on the terms and
conditions set forth in this Agreement.

     

    (c) As
consideration for the Issue Shares and the Warrants, and in exchange therefor,
(i) Investor has, pursuant to an oral agreement, provided valuable services to
the Company the monetary value of which the board of directors of the Company
has determined to be Fifty-Five Thousand and No/100 Dollars ($55,000.00) (the
“Services Purchase Price”); and (ii) Investor shall pay to the Company Eight
Hundred Seventy-Five and No/100 Dollars ($875.00) (the “Cash Purchase Price;”
collectively with the Services Purchase Price, the “Purchase Price”). The total
aggregate value of the Purchase Price shall be Fifty-Five Thousand Eight Hundred
Seventy-Five and No/100 Dollars ($55,875.00).

     

    (d) The
parties acknowledge that the appraised value of the Shares is approximately
$42,438.00 and Investor agrees that upon receipt of the Shares, Investor shall
be paid in full for the services rendered to the Company and referenced in
section 1(c) above, and Investor shall have no further claim for any additional
payment therefor.

     

    
      
        
        

      

      
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    1.2 Closing. The purchase
and sale of the Issue Shares and the Warrants shall take place at the offices of
the Company at 11:00 A.M., on August__, 2008, or at such other time and place as
the Company and the Investor mutually agree upon orally or in writing (which
time and place are designated as the “Closing”). At the Closing, the Company
shall deliver to Investor a duly executed stock certificate representing the
Issue Shares and the duly executed Warrants and Investor shall deliver to the
Company the Cash Purchase Price and all other documents and materials required
pursuant to this Agreement. Notwithstanding any other provision of this
Agreement to the contrary, in no event shall the Company be required to issue
any Issue Shares or Warrants to Investor unless and until all payments and other
documents and materials required to be delivered by Investor have been received
by the Company and all conditions of this Agreement have been
fulfilled.

     

    1.3 Warrants and Warrant
Shares. Investor may exercise its right to purchase shares of the Common
Stock, pursuant to the Warrants, on the terms and conditions set forth in this
section (the “Warrant Shares”).

     

    (a) No
later than one (1) year after the date of registration with the SEC of any
shares of the Common Stock of the Company for sale or resale to the public
(“First Termination Date”), Investor may elect to purchase, whereupon the
Company shall issue, pursuant to the terms and conditions of this Agreement, up
to Two Hundred Forty-Three Thousand Sixty (243,060) Warrant Shares at an
exercise price of One and 50/100 Dollars ($1.50) per share (“First Exercise
Price”). Investor’s right to purchase any Warrant Shares pursuant to this
subsection shall expire at 5:00 P.M. Pacific Time on the First Termination
Date.

     

    (b) No
later than two (2) years after the date of such registration of any shares of
the Common Stock of the Company (“Second Termination Date”), Investor may elect
to purchase, whereupon the Company shall issue, pursuant to the terms and
conditions of this Agreement, up to Two Hundred Forty-Three Thousand Sixty
(243,060) Warrant Shares at an exercise price of Two and No/100 Dollars ($2.00)
per share (“Second Exercise Price”). Investor’s right to purchase any Warrant
Shares pursuant to this subsection shall expire at 5:00 P.M. Pacific Time on the
Second Termination Date.

     

    (c) No
later than three (3) years after the date of such registration of any shares of
the Common Stock of the Company (“Third Termination Date;” collectively with the
First Termination Date and the Second Termination Date, the “Termination
Dates”), Investor may elect to purchase, whereupon the Company shall issue,
pursuant to the terms and conditions of this Agreement, up to Two Hundred
Forty-Three Thousand Sixty (243,060) Warrant Shares at an exercise price of Two
and 50/100 Dollars ($2.50) per share (“Third Exercise Price;” collectively with
the First Exercise Price and the Second Exercise Price, the “Exercise Price”).
Investor’s right to purchase any Warrant Shares pursuant to this subsection
shall expire at 5:00 P.M. Pacific Time on the Third Termination
Date.

     

    (d)
Notwithstanding any other provision of this Agreement to the contrary, in no
event shall Investor be permitted to purchase any Warrant Shares later than the
date which is ten (10) years after the date of this Agreement, nor shall any
Warrant be sold, transferred, assigned, hypothecated, pledged, or in any way
alienated (each a “Transfer”) by Investor to any person and all such attempted
or purported Transfers shall be null and void.

     

    
      
        
        

      

      
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    (e) In
order to exercise any right to purchase Warrant Shares, Investor shall deliver
to the Company written and executed notice of Investor’s intent to exercise
Investor’s right to purchase said Warrant Shares (the “Notice”). The Notice
shall specify the number of Warrant Shares which Investor elects to purchase,
the applicable Exercise Price per share, and the total price for all Warrant
Shares which Investor intends to purchase. Unless the Notice is delivered before
5:00 P.M. Pacific Time on the applicable Termination Date, the Notice shall be
null and void.

     

    (f) If
the Notice is timely delivered to the Company, the purchase and sale of the
Warrant Shares shall take place at the offices of the Company at 11:00 A.M., on
the day which is ten (10) business days after the timely delivery of the Notice
to the Company, or at such other time and place as the Company and the Investor
mutually agree upon orally or in writing (each such time and place are
designated as a “Warrant Closing”). At each Warrant Closing, the Company shall
deliver to Investor a duly executed stock certificate representing the Warrant
Shares that Investor is purchasing and Investor shall deliver to the Company the
applicable Exercise Price and all other, documents and materials required
pursuant to this Agreement. Notwithstanding any other provision of this
Agreement to the contrary, in no event shall the Company be required to issue
any Warrant Shares to Investor unless and until (i) such issuance is in
compliance with all applicable federal and state securities laws, and (ii) all
payments and other documents and materials required to be delivered by Investor
have been received by the Company and all conditions of this Agreement have been
fulfilled.

     

    2. Representations and Warranties of the
Company. The Company hereby represents and warrants to Investor that, as
of the date hereof unless a different date is specified, and except as set forth
on a Schedule of Exceptions (the “Schedule of Exceptions”) furnished to the
Investor prior to execution hereof and attached hereto as Schedule A, which exceptions shall be
deemed to be representations and warranties as if made hereunder:

     

    2.1 Organization. Good Standing
and Qualification. The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of California. The
Company is duly qualified to transact business and is in good standing in each
jurisdiction in which the failure to so qualify would have a material adverse
effect on its business or properties.

     

    
      
        
        

      

      
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    2.2 Capitalization Common
Stock. The authorized capital of the Company consists of One Hundred
Million (100,000,000) shares of common stock, no par value per share, of which
Sixteen Million Six Hundred Sixty-Seven Thousand (16,667,000) shares are issued
and outstanding as of the date hereof.

     

    (b) As of
the date hereof, the outstanding shares of Common Stock are owned by the
stockholders and in the numbers specified in Exhibit A hereto.

     

    (c) The
outstanding shares of Common Stock are all duly and validly authorized and
issued, fully paid and nonassessable, and were issued in compliance with all
applicable state and federal laws concerning the issuance of
securities.

     

    (d)
Except as set forth in the Schedule of Exceptions attached hereto as Schedule A, there are
not outstanding any options, warrants, rights (including conversion or
preemptive rights) or agreements for the purchase or acquisition from the
Company of any shares of its capital stock. Except as set forth herein, the
Company is not a party or subject to any agreement or understanding, and, to the
Company’s knowledge, there is no agreement or understanding between any persons
and/or entities, which affects or relates to the voting or giving of written
consents with respect to any security or by a director of the
Company.

     

    2.3 Subsidiaries. The
Company does not presently own or control, directly or indirectly, any interest
in any other corporation, association, or other business entity. The Company is
not a participant in any joint venture, partnership, or similar
arrangement.

     

    2.4 Authorization. All
corporate action on the part of the Company, its officers, directors and
stockholders necessary for the authorization, execution and delivery of this
Agreement and the performance of all obligations of the Company hereunder has
been taken. This Agreement constitutes valid and legally binding obligations of
the Company, enforceable in accordance with its terms, except (i) as limited by
applicable bankruptcy, insolvency, reorganization, moratorium and other laws of
general application affecting enforcement of creditors’ rights generally, and
(ii) as limited by laws relating to the availability of specific performance,
injunctive relief or other equitable remedies.

     

    2.5 Valid Issuance of Common
Stock. The Common Stock that is being purchased by the Investor
hereunder, when issued, sold and delivered in accordance with the terms of this
Agreement for the consideration expressed herein, will be duly and validly
issued, fully paid and nonassessable and will be free of restrictions on
transfer, other than restrictions on transfer under this Agreement and under
applicable state and federal securities laws.

     

    
      
        
        

      

      
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    2.6 Governmental
Consents. No consent, approval, order or authorization of, or
registration, qualification, designation, declaration or filing with, any
federal, state or local governmental authority on the part of the Company is
required in connection with the issuance of the Issue Shares and Warrants,
except for such filings as are required pursuant to applicable federal and state
securities laws and blue sky laws, which filings will be effected within the
required statutory period.

     

    2.7 Offering. Subject in
part to the truth and accuracy of the Investor’s representations set forth in
Section 3 of this Agreement, the offer, sale and issuance of the Shares as
contemplated by this Agreement are exempt from the registration requirements of
the Securities Act of 1933, as amended (the “Act”), and the qualification or
registration requirements of applicable blue sky laws. Neither the Company nor
any authorized agent acting on its behalf will take any action hereafter that
would cause the loss of such exemptions.

     

    2.8 Litigation. There is
no action, suit, proceeding or investigation pending, or to the Company’s
knowledge, currently threatened against the Company that questions the validity
of this Agreement or the right of the Company to enter into such agreement or to
consummate the transactions contemplated hereby, or that might result, either
individually or in the aggregate, in any material adverse changes in the
business, assets or condition of the Company, financially or otherwise, or any
change in the current equity ownership of the Company. The Company is not a
party or subject to the provisions of any order, writ, injunction, judgment or
decree of any court or government agency or instrumentality. There is no action,
suit, proceeding or investigation by the. Company currently pending or that the
Company intends to initiate.

     

    2.9 Compliance with Other
Instruments. The Company is not in violation in any material respect of
any provision of its articles of incorporation (the “Articles”) or bylaws (the
“Bylaws”) nor, to its knowledge, in any material respect of any instrument,
judgment, order, writ, decree or contract, statute, rule or regulation to which
the Company is subject and a violation of which would have a material adverse
effect on the condition, financial or otherwise, or operations of the Company.
The execution, delivery and performance of this Agreement and the consummation
of the transactions contemplated hereby will not result in any such violation,
or be in conflict with or constitute, with or without the passage of time and
giving of notice, either a default under any such provision or an event that
results in the creation of any lien, charge or encumbrance upon any assets of
the Company or the suspension, revocation, impairment, forfeiture or nonrenewal
of any material permit, license, authorization or approval applicable to the
Company, its business or operations or any of its assets or
properties.

     

    2.10
Permits. The
Company has all franchises, permits, licenses and any similar authority
necessary for the conduct of its business as it is presently conducted, the lack
of which could materially and adversely affect the business, properties or
financial condition of the Company. The Company is not in default in any
material respect under any of such franchises, permits, licenses or other
similar authority.

     

    
      
        
        

      

      
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    2.11
Corporate Documents
Minute Books. The Articles and Bylaws of the Company are in the form
previously provided to the Investor. The minute books of the Company provided to
the Investor contain a complete summary of all meetings of directors and
stockholders since the time of incorporation and reflect all transactions
referred to in such minutes accurately in all material respects.

     

    3. Representations, Warranties and Covenants of the
Investor. The Investor represents, warrants and covenants
that:

     

    3.1 Authorization.
Investor has full power and authority to enter into this Agreement and such
agreement constitutes a valid and legally binding obligation, enforceable
against Investor in accordance with its terms. Investor hereby represents and
warrants to Company that, as of the date hereof unless a different date is
specified, and except as set forth on a Schedule of Exceptions (the “Schedule of
Exceptions”) furnished to the Company prior to execution hereof and attached
hereto as Schedule A1, which
exceptions shall be deemed to be representations and warranties as if made
hereunder:

     

    3.2 Organization, Good
Standing and Qualification. The Investor is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Maryland. The Investor is duly qualified to transact business and is in
good standing in each jurisdiction in which the failure to so qualify would have
a material adverse effect on its business or properties.

     

    3.3 Purchase Entirely for Own
Account. This Agreement is made with Investor in reliance upon Investor’s
representation to the Company, which by Investor’s execution of this Agreement
Investor hereby confirms, that the Shares to be received by Investor (the “Securities”) will be
acquired for investment for Investor’s own account, not as a nominee or agent,
and not with a view to the resale or distribution of any part thereof, and that
Investor has no present intention of selling, granting any participation in or
otherwise distributing the same. By executing this Agreement, Investor further
represents that Investor does not have any contract, undertaking, agreement or
arrangement with any person to sell, transfer or grant participations to such
person or to any third person, with respect to any of the
Securities.

     

    3.4 Disclosure of
Information. Investor believes it has received all the information it
considers necessary or appropriate for deciding whether to purchase the Shares.
Investor further represents that it has had an opportunity to ask questions and
receive answers from the Company regarding the terms and conditions of the
offering of the Shares and the business, properties, prospects and financial
condition of the Company.

     

    
      
        
        

      

      
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    3.5 Investment
Experience. Investor is an investor in securities of companies in the
development stage and acknowledges that it is able to fend for itself, can bear
the economic risk of its investment, and has such knowledge and experience in
financial or business matters that it is capable of evaluating the merits and
risks of the investment in the Shares.

     

    
      3.6 Accredited Investor.
Investor has read the definition of “accredited investor” attached to this
Agreement as Exhibit B and Investor is an “accredited investor” within the
meaning of Rule 501 of Regulation D of the Act, Investor has completed fully and
executed Exhibit B. Investor acknowledges and agrees that the Company is relying
and may rely on this and the other representations, warranties and covenants
made by investor herein for compliance with federal and state securities
laws.

       

      3.7 Restricted
Securities. Investor understands that the Securities it is purchasing are
characterized as “restricted securities” under the federal securities laws in as
much as they are being acquired from the Company in a transaction not involving
a public offering, that the Securities have not been registered under the Act,
and that under federal securities laws and applicable regulations such
Securities may be resold without registration under the Act only in certain
limited circumstances. In the absence of an effective registration statement
covering the Securities or an available exemption from registration under the
Act, the Securities must be held indefinitely. In this connection,
Investor represents that it is familiar with Rule 144 of the Act and understands
the resale limitations imposed thereby and by the Act, including without
limitation the Rule 144 condition that current information about the Company be
available to the public. Such information is not now available and the Company
has no present plans to make such information available.

       

      3.8 Further Limitations on
Disposition. Without in any way limiting the representations set forth
above, Investor further agrees not to make any disposition of all or any portion
of the Securities unless and until the transferee has agreed in writing for the
benefit of the Company to be bound by this Section 3, and:

       

      (a) There
is then in effect a registration statement under the Act covering such proposed
disposition and such disposition is made in accordance with such registration
statement; or

       

      (b) (i)
Investor shall have notified the Company of the proposed disposition and shall
have furnished the Company with a detailed statement of the circumstances
surrounding the proposed disposition, and (ii) if requested by the Company,
Investor shall have furnished the Company with an opinion of counsel, reasonably
satisfactory to the Company, that such disposition will not require registration
of such shares under the Act nor result in the loss of any exemption under the
Act or any applicable blue sky laws.

       

      
        
          
          

        

        
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      (c) In no
event shall Investor make any disposition or Transfer of any Issue Shares or
Warrant Shares, or any right, title, or interest of Investor therein, until
the
date which is three (3) years after the date of this Agreement, except that
Investor shall be permitted to Transfer Issue Shares or Warrant Shares acquired
by Investor pursuant to this Agreement on the following conditions: (i) Investor
gives five (5) business days’ prior written notice to the Company of Investor’s
intent to Transfer the Issue Shares or Warrant Shares, including notice of the
number of shares to be Transferred, the price or other consideration
therefor, the proposed transferee, and the proposed date of the Transfer; (ii)
Balwinder Samra, an officer and shareholder of the Company (“Samra”), shall have
already Transferred shares of the Common Stock before Investor Transfers any of
Investor’s Shares; (iii) Investor will not Transfer a greater percentage of the
Shares owned by Investor than the percentage which Samra Transferred of the
shares of Common Stock owned by Samra (e.g., if Samra Transfers 10% of the
Common Stock owned by Samra, then Investor may Transfer up to 10%, but no more,
of the Shares owned by Investor); and (iv) no Transfer by Investor of the Shares
will result in the loss of any exemption from registration or qualification of
the Common Stock or of any other security of the Company under the Act or any
applicable blue sky laws.

    

     

    3.9 Legends. It is
understood that the certificates evidencing the Securities may bear one or more
legends restricting the transfer thereof or indicating the existence of
restrictions on such transfer including legends substantially as set forth in
this Section 3.8;

     

    (a)
“These securities have not been registered or qualified under the Securities Act
of 1933, as amended (the “Act”) or any applicable state securities laws. They
may not be sold, offered for sale, pledged or hypothecated in the absence of a
registration statement in effect with respect to the securities under such Act
and qualification under applicable state securities laws or an opinion of
counsel satisfactory to the Company that such registration and qualification is
not required.”

     

    (b) Any
legend required by the laws of the State of California, including, without
limitation, any legend required by the California Department of Corporations and
Sections 417 and 418 of the California Corporations Code.

     

    3.10
Tax Advisors. Investor
has reviewed with Investor’s own tax advisors the federal, state and local tax
consequences of this investment, where applicable, and the transactions
contemplated by this Agreement. Investor is relying solely on such advisors and
not on any statements or representations of the Company or any of its agents and
understands that Investor (and not the Company) shall be responsible for
Investor’s own tax liability that may arise as a result of this investment or
the transactions contemplated by this Agreement.

     

    3.11
Lock–up
Agreements. Investor acknowledges that Investor may from time to time be
asked to enter into a “market stand-still” or “lock-up” agreement further
restricting Investor’s ability to sell or otherwise transfer the Securities.
Investor hereby agrees to execute and deliver any such market stand-still,
lock-up or similar
agreement, provided that investor shall not be required to execute and deliver
any such agreement unless Samra executes and delivers a similar agreement
providing substantially the same restrictions on any sale of transfer of any
shares of the Company’s stock held by Samra.

     

    
      
        
        

      

      
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            4.
California
Commissioner of Corporations.

     

    4.1 Corporate Securities
Law. THE SALE OF THE SECURITIES THAT ARE THE SUBJECT OF THIS AGREEMENT
HAS NOT BEEN QUALIFIED WITH THE COMMISSIONER OF CORPORATIONS OF THE STATE OF
CALIFORNIA AND THE ISSUANCE OF SUCH SECURITIES OR THE PAYMENT OR RECEIPT OF ANY
PART OF THE CONSIDERATION FOR SUCH SECURITIES PRIOR TO SUCH QUALIFICATION IS
UNLAWFUL, UNLESS THE SALE OF SECURITIES IS EXEMPT FROM QUALIFICATION BY SECTION
25100, 25102 OR 25105 OF THE CALIFORNIA CORPORATIONS CODE, THE RIGHTS OF ALL
PARTIES TO THIS AGREEMENT ARE EXPRESSLY CONDITIONED UPON SUCH QUALIFICATION
BEING OBTAINED, UNLESS THE SALE IS SO EXEMPT.

     

    5. Conditions of Investor’s
Obligations at Closing. The obligations of Investor under subsection 1.1
(c) of this Agreement are subject to the fulfillment on or before the Closing,
of each of the following conditions, the waiver of which shall not be effective
unless Investor consents thereto:

     

    5.1 Representations and
Warranties. The representations and warranties of the Company contained
in Section 2 shall be true on and as of the Closing, with the same effect as
though such representations and warranties had been made on and as of the date
of such Closing.

     

    5.2 Performance. The
Company shall have performed and complied with all agreements, obligations and
conditions contained in this Agreement that are required to be performed or
complied with by it on or before the Closing.

     

    5.3 Qualifications.
Except as otherwise stated in this Agreement, all authorizations, approvals or
permits, if any, of any governmental authority or regulatory body of the United
States or of any state that are required in connection with the lawful issuance
and sale of the Securities pursuant to this Agreement shall be duly obtained and
effective as of the Closing.

     

    5.4 Proceedings and
Documents. All corporate and other proceedings in connection with the
transactions contemplated at the Closing and all documents incident thereto
shall be reasonably satisfactory in form and substance to Investor’s counsel,
and they shall have received all such counterpart original and certified or
other copies of such documents as they may reasonably request.

     

    
      
        
        

      

      
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    6. Conditions of the Company’s
Obligations at Closing. The obligations of the Company to Investor under
this Agreement are subject to the fulfillment on or before the Closing, or any
Warrant Closing, of each of the following conditions:

     

    6.1 Representations and
Warranties. The representations and warranties of the Investor contained
in Section 3 shall be true on and as of the Closing, or any Warrant Closing,
with the same effect as though such representations and warranties had been made
on and as of the Closing or any Warrant Closing, as applicable.

     

    6.2 Payment of Purchase
Price. The Investor shall have delivered the Cash Purchase Price
specified in Section 1.1(c),

     

    6.3 Qualifications.
Except as otherwise stated in this Agreement, all authorizations, approvals or
permits, if any, of any governmental authority or regulatory body of the United
States or of any state that are required in connection with the lawful issuance
and sale of the Securities pursuant to this Agreement shall be duly obtained and
effective as of the Closing or any Warrant Closing, as applicable.

     

    7. Miscellaneous.

     

    7.1 Survival. The
warranties, representations and covenants of the Company and Investor contained
in or made pursuant to this Agreement shall survive the execution and delivery
of this Agreement and the Closing.

     

    7.2 Successors and
Assigns. Except as otherwise provided herein, the terms and conditions of
this Agreement shall inure to the benefit of and be binding upon the respective
successors and assigns of the parties (including transferees of any Securities).
Nothing in this Agreement, express or implied, is intended to confer upon any
party, other than the parties hereto or their respective successors and assigns,
any rights, remedies, obligations or liabilities under or by reason of this
Agreement, except as expressly provided in this Agreement.

     

    7.3 Governing Law. This
Agreement shall be governed by and construed under the laws of the State of
California as applied to agreements among California residents entered into and
to be performed entirely within California.

     

    7.4 Titles and Subtitles.
The titles and subtitles used in this Agreement are used for convenience only
and are not to be considered in construing or interpreting this
Agreement.

     

    7.5 Notices. All notices
required or permitted hereunder shall be in writing and shall be deemed
effectively given: (i) upon personal delivery to the party to be notified, (ii)
when sent by confirmed telex or facsimile if sent during normal business hours
of the recipient, if not, then on the next business day; (iii) five days after
having been sent by registered or certified mail, return receipt requested,
postage prepaid; or (iv) one day after deposit with a nationally recognized
overnight courier, specifying next day delivery, with written verification of
receipt. All communications shall be sent to the address as set forth on the
signature page hereof or at such other address as such party may designate by
ten days advance written notice to the other parties hereto.

     

    
      
        
        

      

      
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    7.6 Finder’s Fee. Each
party represents that it neither is nor will be obligated for any finders’ fee
or commission in connection with this transaction. Investor agrees to indemnify
and to hold harmless the Company from any liability for any commission or
compensation in the nature of a finders’ fee (and the costs and expenses of
defending against such liability or asserted liability) for which Investor or
any of its officers, partners, employees or representatives is responsible. The
Company agrees to indemnify and hold harmless Investor from any liability for
any commission or compensation in the nature of a finders’ fee (and the costs
and expenses of defending against such liability or asserted liability) for
which the Company or any of its officers, employees or representatives is
responsible.

     

    7.7 Amendments and
Waivers. Any term of this Agreement may be amended by the written consent
of the parties hereto. The observance of any term of this Agreement may be
waived (either generally or in a particular instance and either retroactively or
prospectively), with the consent of the party or parties entitled to enforce
such observance. Any amendment or waiver effected in accordance with this
paragraph shall be binding upon each holder of any securities purchased under
this Agreement at the time outstanding, each future holder of all such
securities, and the Company.

     

    7.8 Severability. If one
or more provisions of this Agreement are held to be unenforceable under
applicable law, such provision shall be excluded from this Agreement and the
balance of the Agreement shall be interpreted as if such provision were so
excluded and shall be enforceable in accordance with its terms.

     

    7.9 Entire Agreement. This
Agreement constitutes the entire agreement among the parties and no party shall
be liable or bound to any other party in any manner by any warranties,
representations or covenants except as specifically set forth herein or
therein.

     

    
      
        
        

      

      
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    7.10
Waiver of
Conflicts. Each party to this Agreement acknowledges that Richard
Christesen, counsel for the Company, has in the past and may continue to perform
legal services for the Company and/or the Investor in matters unrelated to the
transactions described in this Agreement. Each party to this Agreement also
acknowledges that David Culmer, also counsel for the Company, may continue to
perform legal services for the Company and/or the Investor in matters unrelated
to the transactions described in this Agreement. Accordingly, each party to this
Agreement hereby (i) acknowledges that they have had an opportunity to ask for
information relevant to this disclosure, (ii) acknowledges that Richard
Christesen and David Culmer represented the Company in the transaction
contemplated by this Agreement and have not represented Investor or any
individual stockholder or employee of the Company in connection with such
transaction, (iii) gives its informed consent to the representation by Richard
Christesen and/or David Culmer of the Investor in such unrelated matters and the
representation by Richard Christesen and/or David Culmer of the Company in
connection with this Agreement and the transactions contemplated hereby and any
unrelated matters. Investor hereby acknowledges that it has been informed that
it should seek the advise of an independent attorney and has either availed
itself of that right or has elected to waive that right.

     

    7.11
Construction.
Each party to this Agreement acknowledges and agrees that it has been given the
opportunity to review this Agreement independently with legal counsel, and that
each party to this Agreement has cooperated in the drafting of this Agreement
such that any construction to be made of this Agreement shall not be made based
on any rule providing for interpretation against the party who causes
uncertainty to exist, or against the draftsman. Whenever the singular number is
used in this Agreement and when required by the context, the same shall include
the plural and vice versa, and the masculine gender shall include the feminine
and neuter genders and vice versa.

     

    7.12
Counterparts.
This Agreement may be executed in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and the
same instrument.

     

    
      
        
        

      

      
        - 12
-

        
          

        

      

      
        
        

      

    

     

    IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first
above written.

    
      	 
      	 
      	 
      
	 
      	 
      	
              “Company”:

            
	 
      	 
      	 
      
	 
      	 
      	
              BALQON
      CORPORATION,

              a
      California corporation

            
	 
      	 
      	 
      
	 
      	
              By:

            	

              /s/
      Balwinder Samra

            
	 
      	 
      	
              Balwinder
      Samra

            
	 
      	 
      	
              Its:
      President

            
	 
      	 
      	 
      

    

    

    
      	 
      	
              Address

            	
              1701
      E. Edinger Ave., Unit E-3,

              Santa
      Ana, CA 92705

              Facsimile:
      (714) 836-6343

            
	 
      	 
      	 
      
	 
      	
              “Investor”:

            
	 
      	 
      
	 
      	
              MARLIN
      FINANCIAL GROUP, INC,

            
	 
      	 
      
	 
      	
              By:

            	
              
                /s/ Mark
      Levine

              

            
	 
      	 
      	
              Mark
      Levin

              Its:
      CEO

            

    

    

    
      	 
      	
              Address

            	
              9812
      Falls Road, Suite 114-198 

              Potomac,
      MD 20854

            
	 
      	 
      	
              Facsimile:
      4434312508

            

    

     

     

    13ex_10-23.htm

    
      

      

    

    EXHIBIT
10.23

     

     

    AMENDMENT NO. 1 TO STOCK AND
WARRANT PURCHASE AGREEMENT

     

     

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

     

    Recitals

     

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

     

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

     

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

     

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

    

    Agreement

     

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

     

    
      	
              1.  

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

            

    

     

    
      	
              2.  

            	
              Amendments.

            

    

     

    
      	
              2.1.  

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

            

    

     

    
      	
              2.2.  

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

            

    

     

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

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    
      	
              2.3.  

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

            

    

     

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

     

    
      	
              3.  

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

            

    

     

    

     

    [signature
page follows]

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    

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

     

    
      
        	The
      Company: 	Balqon
      Corporation	 
	 	 	 	 
	
                 

              	
                By:
      

              	/s/ B.
      Samra	 
	 	 	
                Name :
      B. Samra

                Title: Chief Executive Officer

              	 

      

    

     

    
      
        
          	Marlin:	MARLIN
      FINANCIAL GROUP, INC.	 
	 	 	 	 
	
                  
                     

                  

                	
                  By:
      

                	/s/ Mark
      Levin	 
	 	 	
                  Name :
      Mark Levin

                  Title: President

                	 

        

      

    

     

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

     

    EXHIBIT
A

     

     

    
      NEITHER THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON THE
EXERCISE OF THESE SECURITIES HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR
ANY STATE SECURITIES LAWS.  THE SECURITIES REPRESENTED HEREBY MAY NOT
BE EXERCISED, OFFERED, SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED OR OTHERWISE
ASSIGNED (EACH A “TRANSFER”) EXCEPT (A)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSFER NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (B) TO THE EXTENT THE
TRANSFER DOES NOT CONSTITUTE AND WILL NOT RESULT IN A VIOLATION OF APPLICABLE
FEDERAL OR STATE SECURITIES LAWS, AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
THE TRANSFEROR TO SUCH EFFECT (TO THE EXTENT REQUESTED BY COUNSEL OF THE
COMPANY), THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY.  THE HOLDER HEREOF AGREES THAT IT WILL DELIVER, OR CAUSE TO
BE DELIVERED, TO EACH PERSON TO WHOM THE SECURITIES HEREBY REPRESENTED ARE
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND.  THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE OF
THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
SECURED BY SUCH SECURITIES.

       

      

      STOCK
PURCHASE WARRANT

      

      BALQON
CORPORATION

       

      

       

      Original
Issue Date: June 4, 2008

       

      THIS
CERTIFIES that, for value received, Marlin Financial Group (the “Holder”), is
entitled, upon the terms and subject to the conditions hereinafter set forth, to
subscribe for and purchase, from BALQON CORPORATION, a California corporation
(the “Company”), at any
time upon the terms and subject to the conditions set forth herein, from the
Company, 243,060 shares of common stock (“Common Stock”) of the
Company (the “Warrant
Shares”).  The exercise price of one share of Common Stock
under this Warrant shall be $1.50 (“Exercise Price”),
subject to adjustment as provided herein.  If the purchase rights
represented by this Warrant are not exercised before the close of business on
the day preceding June 30, 2010, this Warrant shall be void.

       

      1.           Title of
Warrant.  Prior to the expiration hereof and subject to
compliance with applicable laws, this Warrant and all rights hereunder are
transferable, in whole or in part, at the office or agency of the Company,
referred to in Section 3
hereof, by the holder hereof in person or by duly authorized attorney, upon
surrender of this Warrant together with the Assignment Form annexed hereto
properly endorsed.

       

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

       

      2.           Investment
Representations.

       

      (a)           Holder
confirms that it has been given sufficient access to information regarding the
Company and in connection with its decision to receive this Warrant, including
any common stock issuable upon the exercise of this Warrant (collectively, the
“Securities”),
including the opportunity to ask questions of, and receive answers from, persons
acting on behalf of Company and concerning Company’s financial affairs,
prospects and condition.

       

      (b)           Holder
represents and warrants that (i) it is resident in or otherwise subject to the
securities legislation of the United States, and the issuance of the Securities
to Holder has occurred only in the United States; (ii) Holder, by reason of its
business or financial expertise, has the capacity to protect its own interests
in connection with its acquisition of the Securities; and (iii) Holder is an
“accredited investor” as defined in Rule 501 of Regulation D of the Securities
Act of 1933, as amended (the “Securities
Act”).

       

      (c)           Holder
represents, warrants and covenants that it shall acquire the Securities for its
own account and not for the account or on behalf of others, and it is doing so
with the intent of retaining such Securities as an investment and without the
current intent to redistribute such Securities.

       

      (d)           Holder
acknowledges that: (i) no securities commission or similar authority has
reviewed or passed on the merits of the Securities; (ii) there is no government
or other insurance covering such Securities; and (iii) there are risks
associated with the acquisition of the Securities.

       

      (e)           Holder
acknowledges that (i) it must and shall bear the economic risk of holding the
Securities, which may be for an indefinite period of time, because at the time
such Securities are issued they will not have been registered under the
Securities Act or any other securities law and, therefore, cannot be sold unless
they are subsequently registered under applicable federal and state securities
laws or an exemption from such registration is available; (ii) the Securities
may not be resold or transferred on the official stock transfer records of
Company without furnishing to Company an opinion of counsel reasonably
acceptable to Company that such sale or transfer of the Securities will not
violate the registration provisions of applicable federal and state securities
laws; and (iii) certificates representing the Securities shall have endorsed on
them a restrictive legend to this effect.

       

      (f)           Holder
acknowledges that Company is relying on the representations, warranties,
covenants and acknowledgments in this Section 2 to
ensure that the Securities can be issued in reliance on exemptions from
registration requirements under United States federal and state securities
laws.

       

      3.           Exercise of
Warrant.

       

      (a)           The
purchase rights represented by this Warrant are exercisable by the Holder by the
surrender of this Warrant and the Notice of Exercise annexed hereto duly
completed and executed on behalf of the Holder, at the office of the Company (or
such other office or agency of the Company as it may designate by notice in
writing to the Holder at the address of the Holder appearing on the books of the
Company), upon payment in cash, certified check or wire transfer of funds, of
the aggregate Exercise Price for that number of Warrant Shares then being
purchased.

       

      
        
           

        

        
          5

          
            

          

        

        
           

        

      

       

      (b)           This
Warrant shall be deemed to have been exercised immediately prior to the close of
business on the date of its surrender for exercise as provided above, and the
person entitled to receive the shares of Common Stock issuable upon such
exercise shall be treated for all purposes as the holder of record of such
shares as of the close of business on such date.  As promptly as
practicable on or after such date and in any event within ten (10) days
thereafter, the Company at its expense shall issue and deliver to the person or
persons entitled to receive the same a certificate or certificates for the
number of shares issuable upon such exercise.  In the event that this
Warrant is exercised in part, the Company at its expense will execute and
deliver a new Warrant of like tenor exercisable for the number of shares for
which this Warrant may then be exercised.  Each exercise hereof shall
constitute the reaffirmation by the holder hereof that the representations and
warranties contained in Section 2 of
this Warrant true and correct in all material respects with respect to the
Holder of the Warrant as of the time of such exercise.

       

      4.           No Fractional Shares or
Scrip.  No fractional shares or scrip representing fractional
shares shall be issued upon the exercise of this Warrant.  With
respect to any fraction of a share called for upon the exercise of this Warrant,
an amount equal to such fraction multiplied by the then current price at which
each share may be purchased hereunder shall be paid in cash to the holder of
this Warrant.

       

      5.           Charges, Taxes and
Expenses.  Issuance of certificates for shares of Common Stock
upon the exercise of this Warrant shall be made without charge to the holder
hereof for any issue or transfer tax or other incidental expense in respect of
the issuance of such certificate, all of which taxes and expenses shall be paid
by the Company, and such certificates shall be issued in the name of the holder
of this Warrant or in such name or names as may be directed by the holder of
this Warrant; provided, however, that in the event certificates for shares of
Common Stock are to be issued in a name other than the name of the holder of
this Warrant, this Warrant when surrendered for exercise shall be accompanied by
the Assignment Form attached hereto duly executed by the holder hereof; and
provided further, that upon any transfer involved in the issuance or delivery of
any certificates for shares of Common Stock, the Company may require, as a
condition thereto, the payment of a sum sufficient to reimburse it for any
transfer tax incidental thereto.  The Holder of the Warrant shall be
responsible for income taxes due under federal, state, or other law, if any, if
any such tax is due.

       

      6.           No Rights as
Stockholders.  This Warrant does not entitle the holder hereof
to any voting rights or other rights as a stockholder of the Company prior to
the exercise thereof.  Nothing in this Warrant shall be construed to
give any person, firm or corporation (other than the Company and the Holder of
this Warrant) any legal or equitable right, remedy or claim, it being agreed
that this Warrant shall be for the sole and exclusive benefit of the Company and
the Holder of this Warrant.

       

      7.           Exchange and Registry of
Warrant.  This Warrant is exchangeable, upon the surrender
hereof by the registered holder at the above-mentioned office or agency of the
Company, for a new Warrant of like tenor and dated as of such
exchange.  The Company shall maintain at the above-mentioned office or
agency a registry showing the name and address of the registered holder of this
Warrant.  This Warrant may be surrendered for exchange, transfer or
exercise, in accordance with its terms, at such office or agency of the Company,
and the Company shall be entitled to rely in all respects, prior to written
notice to the contrary, upon such registry.

       

      
        
           

        

        
          6

          
            

          

        

        
           

        

      

       

      8.           Loss, Theft, Destruction or
Mutilation of Warrant.  Upon receipt by the Company of evidence
reasonably satisfactory to it of the loss, theft, destruction or mutilation of
this Warrant, and in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to it, and upon reimbursement to the Company of
all reasonable expenses incidental thereto, and upon surrender and cancellation
of this Warrant, if mutilated, the Company will make and deliver a new Warrant
of like tenor and dated as of such cancellation, in lieu of this
Warrant.

       

      9.           Saturdays, Sundays,
Holidays, etc.  If the last or appointed day for the taking of
any action or the expiration of any right required or granted herein shall be a
Saturday or a Sunday or shall be a legal holiday, then such action may be taken
or such right may be exercised on the next succeeding day not a legal
holiday.

       

      10.           Transferability and
Nonnegotiability of Warrant.  This Warrant may not be
transferred or assigned in whole or in part without compliance with all
applicable federal and state securities laws by the transferor and the
transferee (including the delivery of investment representation letters and
legal opinions reasonably satisfactory to the Company, if such are requested by
the Company).  Subject to the provisions of this Warrant with respect
to compliance with the Securities Act, title to this Warrant may be transferred
by endorsement (by the Holder executing the Assignment Form annexed hereto) and
delivery in the same manner as a negotiable instrument transferable by
endorsement and delivery.

       

      11.           Compliance With Securities
Laws.

       

      (a)           The
Holder of this Warrant represents and warrants that this Warrant and the shares
of Common Stock to be issued upon exercise hereof are being acquired solely for
the Holder’s own account and not as a nominee for any other party, and for
investment, and that the Holder will not offer, sell or otherwise dispose of
this Warrant or any shares of Common Stock to be issued upon exercise hereof
except under circumstances that will not result in a violation of the Securities
Act or any state securities laws.  Upon exercise of this Warrant, the
Holder shall, if requested by the Company, confirm in writing, in a form
satisfactory to the Company, that the shares of Common Stock so purchased are
being acquired solely for the Holder’s own account and not as a nominee for any
other party, for investment, and not with a view toward distribution or
resale.

       

      (b)           This
Warrant and all shares of Common Stock issued upon exercise hereof shall be
stamped or imprinted with a legend in substantially the following form (in
addition to any legend required by state securities laws):

       

      
        
           

        

        
          7

          
            

          

        

        
           

        

      

       

      NEITHER
THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON THE EXERCISE OF THESE
SECURITIES HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS.  THE SECURITIES
REPRESENTED HEREBY MAY NOT BE EXERCISED, OFFERED, SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE ASSIGNED (EACH A “TRANSFER”) EXCEPT (A)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSFER NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (B) TO THE EXTENT THE
TRANSFER DOES NOT CONSTITUTE AND WILL NOT RESULT IN A VIOLATION OF APPLICABLE
FEDERAL OR STATE SECURITIES LAWS, AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
THE TRANSFEROR TO SUCH EFFECT (TO THE EXTENT REQUESTED BY COUNSEL OF THE
COMPANY), THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY.  THE HOLDER HEREOF AGREES THAT IT WILL DELIVER, OR CAUSE TO
BE DELIVERED, TO EACH PERSON TO WHOM THE SECURITIES HEREBY REPRESENTED ARE
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND.  THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE OF
THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
SECURED BY SUCH SECURITIES.

       

      12.           Early Termination and
Reclassification.

       

      (a)           Merger, Sale of Assets,
etc.  If all or any portion of this Warrant is exercised
subsequent to a merger, consolidation, exchange of shares, reorganization, or
other similar event (“Change in Control”)
occurring after the date hereof, as a result of which shares shall be changed
into cash, other property, or the same or a different number of shares of the
same or another class or classes of securities of the Company or another entity,
the Holder exercising this Warrant shall receive, for the exercise price, the
aggregate amount of cash or other property and the aggregate number of shares
and class of securities which the Holder would have received if this Warrant was
exercised immediately before the Change in Control.  If an adjustment
under this section would create a fractional share or a right to acquire a
fractional share, the fractional share will be rounded up to, and issued as, a
whole share.  If, pursuant to a Change of Control event, the shares
shall be exchanged solely for cash (in such case, a “Triggering Event”),
then the Company shall give the Holder written notice describing the material
terms and conditions of such impending transaction not later than ten (10) days
prior to the stockholders’ meeting called to approve such transaction (or such
longer period if required by the General Corporation Law of the State of
California), or ten (10) days prior to the closing of such transaction (or such
longer period if required by the General Corporation Law of the State of
California), whichever is earlier, and shall also notify the holder of this
Warrant of the final approval of such transaction.

       

      (b)           Reclassification,
etc.  If the Company at any time shall, by subdivision,
combination or reclassification of securities or otherwise, change any of the
securities to which purchase rights under this Warrant exist into the same or a
different number of securities of any class or classes, this Warrant shall
thereafter be to acquire such number and kind of securities as would have been
issuable as the result of such change with respect to the securities which were
subject to the purchase rights under this Warrant immediately prior to such
subdivision, combination, reclassification or other change.  If shares
of the Company’s Common Stock are subdivided or combined into a greater or
smaller number of shares of Common Stock, the purchase price under this Warrant
shall be proportionately reduced in case of subdivision of shares or
proportionately increased in the case of combination of shares and the number of
shares of Common Stock purchasable under this Warrant shall be proportionally
increased in the case of a subdivision and decreased in the case of combination,
in all cases by the ratio which the total number of shares of Common Stock to be
outstanding immediately after such event bears to the total number of shares of
Common Stock outstanding immediately prior to such event.

       

      
        
           

        

        
          8

          
            

          

        

        
           

        

      

       

      (c)           Cash
Distributions.  No adjustment on account of cash dividends or
interest on the Company’s Common Stock or other securities purchasable hereunder
will be made to the purchase price under this Warrant .

       

      (d)           Authorized
Shares.  The Company covenants that during the period the
Warrant is outstanding, it will reserve from its authorized and unissued Common
Stock a sufficient number of shares to provide for the issuance of Common Stock
upon the exercise of any purchase rights under this Warrant.  The
Company further covenants that its issuance of this Warrant shall constitute
full authority to its officers who are charged with the duty of executing stock
certificates to execute and issue the necessary certificates for shares of the
Company’s Common Stock upon the exercise of the purchase rights under this
Warrant.

       

      13.           Miscellaneous.

       

      (a)           Issue
Date.  The provisions of this Warrant shall be construed and
shall be given effect in all respect as if it had been issued and delivered by
the Company on the date hereof.  This Warrant shall be binding upon
any successors or assigns of the Company.  This Warrant shall
constitute a contract under the laws of the State of California and for all
purposes shall be construed in accordance with and governed by the laws of said
state.

       

      (b)           Restrictions.  The
holder hereof acknowledges that the Common Stock acquired upon the exercise of
this Warrant may have restrictions upon its resale imposed by state and federal
securities laws.

       

      (c)           Entire Agreement and
Amendments.  This Warrant constitutes the entire agreement of
the parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and the Holder
with respect to the subject matter hereof, and may not be modified adversely to
the Holder’s interest except by means of a writing signed by the Company and the
Holder.

       

      (d)           Notices.  Unless
otherwise provided, any notice required or permitted under this Warrant shall be
given in writing and shall be deemed effectively given as hereinafter described
(i) if given by personal delivery, then such notice shall be deemed given upon
such delivery, (ii) if given by telex, facsimile or e-mail, then such notice
shall be deemed given upon receipt of confirmation of complete transmittal,
(iii) if given by mail, then such notice shall be deemed given upon the earlier
of (A) receipt of such notice by the recipient or (B) three days after such
notice is deposited in first class mail, postage prepaid, and (iv) if given by
an internationally recognized overnight air courier, then such notice shall be
deemed given one business day after delivery to such carrier.  All
notices shall be addressed as follows: if to the Holder of the Warrant, at its
address as set forth in the Company’s books and records and, if to the Company,
at the address as follows, or at such other address as the Holder of the
Warrant, or the Company may designate by ten days’ advance written notice to the
other:

       

      
        
           

        

        
          9

          
            

          

        

        
           

        

      

       

      If to the
Company:

       

      Balqon
Corporation

      1701 E.
Edinger, Unit E-3

      Santa
Ana, California 92705

      If to
Holder:

      ________________________________

       

      ________________________________

       

      ________________________________

       

      (e)           Binding Agreement;
Assignment.  The terms and conditions of this Warrant shall
inure to the benefit of and be binding upon the respective successors and
permitted assigns of the parties.  Nothing in this Warrant, express or
implied, is intended to confer upon any third party any rights, remedies,
obligations, or liabilities under or by reason of this Warrant.  This
Warrant may not be assigned by Holder (other than to a Related Person) without
the prior written consent of the Company.  “Related Person” shall
mean with respect to any Holder (i) any affiliate of such person, (ii) any
investment fund, investment account or investment entity whose investment
manager, investment advisor or general partner, is such Holder or any affiliate
of such Holder or any member, partner, officer or employee of such Holder or any
affiliate of such Holder, (iii) any member or partner of any Holder specified in
clause (i) or (ii) above, and (iv) any officer or employee of any person
specified in clause (i), (ii) or (iii) above.

       

      (signature
page follows)

       

      
        
           

        

        
          10

          
            

          

        

        
           

        

      

       

      IN
WITNESS WHEREOF, BALQON CORPORATION has caused this Warrant to be executed by
its officers thereunto duly authorized.

       

      
        
          	 	BALQON
      CORPORATION	 
	 	 	 	 
	
                  Date

                	
                  By:
      

                	 	 
	 	 	Balwinder
      Samra, President	 

        

      

       

      
        	Name
      of Holder: 	 Marlin Financial
      Group  	 	 	 	 
	 	 	 	 	 	 
	 	
                 

              	 	 	
                 

              	 
	      
                (Signature)

              	
                 

              	 	 	
                 

              	 
	 	
                 

              	 	 	
                 

              	 
	Address: 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	Telephone:  	 	 	 	 	 
	Facsimile:   	 	 	 	 	 

      

    

     

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    
      

      NOTICE OF
EXERCISE

       

      To:           BALQON
CORPORATION

       

      (1)           The
undersigned hereby elects to purchase ____________ shares of Common
Stock  of BALQON CORPORATION pursuant to the provisions of Section 3(a) of
the attached Warrant, and tenders herewith payment of the purchase price for
such shares in full.

       

      (2)           In
exercising this Warrant, the undersigned hereby confirms and acknowledges that
the shares of Common Stock to be issued upon exercise thereof are being acquired
solely for the account of the undersigned and not as a nominee for any other
party, and for investment, and that the undersigned will not offer, sell or
otherwise dispose of any such shares of Common Stock except under circumstances
that will not result in a violation of the Securities Act, or any applicable
state securities laws.

       

      (3)           In
exercising this Warrant, the undersigned hereby affirms that the representations
and warranties contained in Section 2 of
this Warrant are true and correct in all material respects.

       

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

       

      
        
          	
                   

                	 	 	
                   

                	 

        

        
          	 	 	 	      
                  Name 

                	 
	 	 	 	 	 
	
                   

                	 	 	
                   

                	 
	
                   

                	 	 	
                  Name 

                	 

        

      

       

      (5)           Please
issue a new Warrant for the unexercised portion of the attached Warrant in the
name of the undersigned or in such other name as is specified
below:

       

      
        
          
            	
                     

                  	 	 	
                     

                  	 

          

          
            	 	 	 	      
                    Name 

                  	 
	 	 	 	 	 
	
                     

                  	 	 	
                     

                  	 
	
                    (Date)

                  	 	 	
                    Signature

                  	 

          

        

         

        
          
             

          

          
            12

            
              

            

          

          
             

          

        

      

       

      ASSIGNMENT
FORM

       

      FOR VALUE
RECEIVED, the undersigned registered owner of this Warrant hereby sells, assigns
and transfers unto the Assignee named below all of the rights of the undersigned
under the within Warrant, with respect to the number of shares of Common Stock
set forth below:

      
        	
                
                   

                  Name
      of Assignee

                

              	
                
                   

                  Address

                

              	
                
                   

                  No.
      of Shares

                

              
	 
      	 
      	 
      
	 
      	 
      	 
      

      

       

      and does
hereby irrevocable constitute and appoint _______________________ Attorney to
make such transfer on the books of BALQON CORPORATION, maintained for the
purpose, with full power of substitution in the premises.

       

      The
undersigned also represents that, by assignment hereof, the Assignee
acknowledges that this Warrant and the shares of Common Stock to be issued upon
exercise hereof or conversion thereof are being acquired for investment and that
the Assignee will not offer, sell or otherwise dispose of this Warrant or any
shares of Common Stock to be issued upon exercise hereof or conversion thereof
except under circumstances which will not result in a violation of the
Securities Act or any state securities laws.  Further, the Assignee
has acknowledged that upon exercise of this Warrant, the Assignee shall, if
requested by the Company, confirm in writing, in a form satisfactory to the
Company, that the shares of Common Stock so purchased are being acquired for
investment and not with a view toward distribution or resale.

       

      
        
          
            
              	Dated:	
                       

                    	 	 	
                       

                    	 

            

            
              	 	 	 	      
                            
                        Signature
      of Holder

                      

                    	 

            

          

           

          
            
               

            

            
              13

              
                

              

            

            
               

            

          

        

      

       

      NEITHER
THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON THE EXERCISE OF THESE
SECURITIES HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS.  THE SECURITIES
REPRESENTED HEREBY MAY NOT BE EXERCISED, OFFERED, SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE ASSIGNED (EACH A “TRANSFER”) EXCEPT (A)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSFER NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (B) TO THE EXTENT THE
TRANSFER DOES NOT CONSTITUTE AND WILL NOT RESULT IN A VIOLATION OF APPLICABLE
FEDERAL OR STATE SECURITIES LAWS, AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
THE TRANSFEROR TO SUCH EFFECT (TO THE EXTENT REQUESTED BY COUNSEL OF THE
COMPANY), THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY.  THE HOLDER HEREOF AGREES THAT IT WILL DELIVER, OR CAUSE TO
BE DELIVERED, TO EACH PERSON TO WHOM THE SECURITIES HEREBY REPRESENTED ARE
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND.  THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE OF
THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
SECURED BY SUCH SECURITIES.

       

      

      STOCK
PURCHASE WARRANT

      

      BALQON
CORPORATION

       

      

       

      Original
Issue Date: June 4, 2008

       

      THIS
CERTIFIES that, for value received, Marlin Financial Group (the “Holder”), is
entitled, upon the terms and subject to the conditions hereinafter set forth, to
subscribe for and purchase, from BALQON CORPORATION, a California corporation
(the “Company”), at any
time upon the terms and subject to the conditions set forth herein, from the
Company, 243,060 shares of common stock (“Common Stock”) of the
Company (the “Warrant
Shares”).  The exercise price of one share of Common Stock
under this Warrant shall be $2.00 (“Exercise Price”),
subject to adjustment as provided herein.  If the purchase rights
represented by this Warrant are not exercised before the close of business on
the day preceding June 30, 2011, this Warrant shall be void.

       

      1.           Title of
Warrant.  Prior to the expiration hereof and subject to
compliance with applicable laws, this Warrant and all rights hereunder are
transferable, in whole or in part, at the office or agency of the Company,
referred to in Section 3
hereof, by the holder hereof in person or by duly authorized attorney, upon
surrender of this Warrant together with the Assignment Form annexed hereto
properly endorsed.

       

      
        
           

        

        
          14

          
            

          

        

        
           

        

      

       

      2.           Investment
Representations.

       

      (a)           Holder
confirms that it has been given sufficient access to information regarding the
Company and in connection with its decision to receive this Warrant, including
any common stock issuable upon the exercise of this Warrant (collectively, the
“Securities”),
including the opportunity to ask questions of, and receive answers from, persons
acting on behalf of Company and concerning Company’s financial affairs,
prospects and condition.

       

      (b)           Holder
represents and warrants that (i) it is resident in or otherwise subject to the
securities legislation of the United States, and the issuance of the Securities
to Holder has occurred only in the United States; (ii) Holder, by reason of its
business or financial expertise, has the capacity to protect its own interests
in connection with its acquisition of the Securities; and (iii) Holder is an
“accredited investor” as defined in Rule 501 of Regulation D of the Securities
Act of 1933, as amended (the “Securities
Act”).

       

      (c)           Holder
represents, warrants and covenants that it shall acquire the Securities for its
own account and not for the account or on behalf of others, and it is doing so
with the intent of retaining such Securities as an investment and without the
current intent to redistribute such Securities.

       

      (d)           Holder
acknowledges that: (i) no securities commission or similar authority has
reviewed or passed on the merits of the Securities; (ii) there is no government
or other insurance covering such Securities; and (iii) there are risks
associated with the acquisition of the Securities.

       

      (e)           Holder
acknowledges that (i) it must and shall bear the economic risk of holding the
Securities, which may be for an indefinite period of time, because at the time
such Securities are issued they will not have been registered under the
Securities Act or any other securities law and, therefore, cannot be sold unless
they are subsequently registered under applicable federal and state securities
laws or an exemption from such registration is available; (ii) the Securities
may not be resold or transferred on the official stock transfer records of
Company without furnishing to Company an opinion of counsel reasonably
acceptable to Company that such sale or transfer of the Securities will not
violate the registration provisions of applicable federal and state securities
laws; and (iii) certificates representing the Securities shall have endorsed on
them a restrictive legend to this effect.

       

      (f)           Holder
acknowledges that Company is relying on the representations, warranties,
covenants and acknowledgments in this Section 2 to
ensure that the Securities can be issued in reliance on exemptions from
registration requirements under United States federal and state securities
laws.

       

      3.           Exercise of
Warrant.

       

      (a)           The
purchase rights represented by this Warrant are exercisable by the Holder by the
surrender of this Warrant and the Notice of Exercise annexed hereto duly
completed and executed on behalf of the Holder, at the office of the Company (or
such other office or agency of the Company as it may designate by notice in
writing to the Holder at the address of the Holder appearing on the books of the
Company), upon payment in cash, certified check or wire transfer of funds, of
the aggregate Exercise Price for that number of Warrant Shares then being
purchased.

       

      
        
           

        

        
          15

          
            

          

        

        
           

        

      

       

      (b)           This
Warrant shall be deemed to have been exercised immediately prior to the close of
business on the date of its surrender for exercise as provided above, and the
person entitled to receive the shares of Common Stock issuable upon such
exercise shall be treated for all purposes as the holder of record of such
shares as of the close of business on such date.  As promptly as
practicable on or after such date and in any event within ten (10) days
thereafter, the Company at its expense shall issue and deliver to the person or
persons entitled to receive the same a certificate or certificates for the
number of shares issuable upon such exercise.  In the event that this
Warrant is exercised in part, the Company at its expense will execute and
deliver a new Warrant of like tenor exercisable for the number of shares for
which this Warrant may then be exercised.  Each exercise hereof shall
constitute the reaffirmation by the holder hereof that the representations and
warranties contained in Section 2 of
this Warrant true and correct in all material respects with respect to the
Holder of the Warrant as of the time of such exercise.

       

      4.           No Fractional Shares or
Scrip.  No fractional shares or scrip representing fractional
shares shall be issued upon the exercise of this Warrant.  With
respect to any fraction of a share called for upon the exercise of this Warrant,
an amount equal to such fraction multiplied by the then current price at which
each share may be purchased hereunder shall be paid in cash to the holder of
this Warrant.

       

      5.           Charges, Taxes and
Expenses.  Issuance of certificates for shares of Common Stock
upon the exercise of this Warrant shall be made without charge to the holder
hereof for any issue or transfer tax or other incidental expense in respect of
the issuance of such certificate, all of which taxes and expenses shall be paid
by the Company, and such certificates shall be issued in the name of the holder
of this Warrant or in such name or names as may be directed by the holder of
this Warrant; provided, however, that in the event certificates for shares of
Common Stock are to be issued in a name other than the name of the holder of
this Warrant, this Warrant when surrendered for exercise shall be accompanied by
the Assignment Form attached hereto duly executed by the holder hereof; and
provided further, that upon any transfer involved in the issuance or delivery of
any certificates for shares of Common Stock, the Company may require, as a
condition thereto, the payment of a sum sufficient to reimburse it for any
transfer tax incidental thereto.  The Holder of the Warrant shall be
responsible for income taxes due under federal, state, or other law, if any, if
any such tax is due.

       

      6.           No Rights as
Stockholders.  This Warrant does not entitle the holder hereof
to any voting rights or other rights as a stockholder of the Company prior to
the exercise thereof.  Nothing in this Warrant shall be construed to
give any person, firm or corporation (other than the Company and the Holder of
this Warrant) any legal or equitable right, remedy or claim, it being agreed
that this Warrant shall be for the sole and exclusive benefit of the Company and
the Holder of this Warrant.

       

      7.           Exchange and Registry of
Warrant.  This Warrant is exchangeable, upon the surrender
hereof by the registered holder at the above-mentioned office or agency of the
Company, for a new Warrant of like tenor and dated as of such
exchange.  The Company shall maintain at the above-mentioned office or
agency a registry showing the name and address of the registered holder of this
Warrant.  This Warrant may be surrendered for exchange, transfer or
exercise, in accordance with its terms, at such office or agency of the Company,
and the Company shall be entitled to rely in all respects, prior to written
notice to the contrary, upon such registry.

       

      
        
           

        

        
          16

          
            

          

        

        
           

        

      

       

      8.           Loss, Theft, Destruction or
Mutilation of Warrant.  Upon receipt by the Company of evidence
reasonably satisfactory to it of the loss, theft, destruction or mutilation of
this Warrant, and in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to it, and upon reimbursement to the Company of
all reasonable expenses incidental thereto, and upon surrender and cancellation
of this Warrant, if mutilated, the Company will make and deliver a new Warrant
of like tenor and dated as of such cancellation, in lieu of this
Warrant.

       

      9.           Saturdays, Sundays,
Holidays, etc.  If the last or appointed day for the taking of
any action or the expiration of any right required or granted herein shall be a
Saturday or a Sunday or shall be a legal holiday, then such action may be taken
or such right may be exercised on the next succeeding day not a legal
holiday.

       

      10.           Transferability and
Nonnegotiability of Warrant.  This Warrant may not be
transferred or assigned in whole or in part without compliance with all
applicable federal and state securities laws by the transferor and the
transferee (including the delivery of investment representation letters and
legal opinions reasonably satisfactory to the Company, if such are requested by
the Company).  Subject to the provisions of this Warrant with respect
to compliance with the Securities Act, title to this Warrant may be transferred
by endorsement (by the Holder executing the Assignment Form annexed hereto) and
delivery in the same manner as a negotiable instrument transferable by
endorsement and delivery.

       

      11.           Compliance With Securities
Laws.

       

      (a)           The
Holder of this Warrant represents and warrants that this Warrant and the shares
of Common Stock to be issued upon exercise hereof are being acquired solely for
the Holder’s own account and not as a nominee for any other party, and for
investment, and that the Holder will not offer, sell or otherwise dispose of
this Warrant or any shares of Common Stock to be issued upon exercise hereof
except under circumstances that will not result in a violation of the Securities
Act or any state securities laws.  Upon exercise of this Warrant, the
Holder shall, if requested by the Company, confirm in writing, in a form
satisfactory to the Company, that the shares of Common Stock so purchased are
being acquired solely for the Holder’s own account and not as a nominee for any
other party, for investment, and not with a view toward distribution or
resale.

       

      (b)           This
Warrant and all shares of Common Stock issued upon exercise hereof shall be
stamped or imprinted with a legend in substantially the following form (in
addition to any legend required by state securities laws):

       

      
        
           

        

        
          17

          
            

          

        

        
           

        

      

       

      NEITHER
THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON THE EXERCISE OF THESE
SECURITIES HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS.  THE SECURITIES
REPRESENTED HEREBY MAY NOT BE EXERCISED, OFFERED, SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE ASSIGNED (EACH A “TRANSFER”) EXCEPT (A)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSFER NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (B) TO THE EXTENT THE
TRANSFER DOES NOT CONSTITUTE AND WILL NOT RESULT IN A VIOLATION OF APPLICABLE
FEDERAL OR STATE SECURITIES LAWS, AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
THE TRANSFEROR TO SUCH EFFECT (TO THE EXTENT REQUESTED BY COUNSEL OF THE
COMPANY), THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY.  THE HOLDER HEREOF AGREES THAT IT WILL DELIVER, OR CAUSE TO
BE DELIVERED, TO EACH PERSON TO WHOM THE SECURITIES HEREBY REPRESENTED ARE
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND.  THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE OF
THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
SECURED BY SUCH SECURITIES.

       

      12.           Early Termination and
Reclassification.

       

      (a)           Merger, Sale of Assets,
etc.  If all or any portion of this Warrant is exercised
subsequent to a merger, consolidation, exchange of shares, reorganization, or
other similar event (“Change in Control”)
occurring after the date hereof, as a result of which shares shall be changed
into cash, other property, or the same or a different number of shares of the
same or another class or classes of securities of the Company or another entity,
the Holder exercising this Warrant shall receive, for the exercise price, the
aggregate amount of cash or other property and the aggregate number of shares
and class of securities which the Holder would have received if this Warrant was
exercised immediately before the Change in Control.  If an adjustment
under this section would create a fractional share or a right to acquire a
fractional share, the fractional share will be rounded up to, and issued as, a
whole share.  If, pursuant to a Change of Control event, the shares
shall be exchanged solely for cash (in such case, a “Triggering Event”),
then the Company shall give the Holder written notice describing the material
terms and conditions of such impending transaction not later than ten (10) days
prior to the stockholders’ meeting called to approve such transaction (or such
longer period if required by the General Corporation Law of the State of
California), or ten (10) days prior to the closing of such transaction (or such
longer period if required by the General Corporation Law of the State of
California), whichever is earlier, and shall also notify the holder of this
Warrant of the final approval of such transaction.

       

      (b)           Reclassification,
etc.  If the Company at any time shall, by subdivision,
combination or reclassification of securities or otherwise, change any of the
securities to which purchase rights under this Warrant exist into the same or a
different number of securities of any class or classes, this Warrant shall
thereafter be to acquire such number and kind of securities as would have been
issuable as the result of such change with respect to the securities which were
subject to the purchase rights under this Warrant immediately prior to such
subdivision, combination, reclassification or other change.  If shares
of the Company’s Common Stock are subdivided or combined into a greater or
smaller number of shares of Common Stock, the purchase price under this Warrant
shall be proportionately reduced in case of subdivision of shares or
proportionately increased in the case of combination of shares and the number of
shares of Common Stock purchasable under this Warrant shall be proportionally
increased in the case of a subdivision and decreased in the case of combination,
in all cases by the ratio which the total number of shares of Common Stock to be
outstanding immediately after such event bears to the total number of shares of
Common Stock outstanding immediately prior to such event.

       

      
        
           

        

        
          18

          
            

          

        

        
           

        

      

       

      (c)           Cash
Distributions.  No adjustment on account of cash dividends or
interest on the Company’s Common Stock or other securities purchasable hereunder
will be made to the purchase price under this Warrant .

       

      (d)           Authorized
Shares.  The Company covenants that during the period the
Warrant is outstanding, it will reserve from its authorized and unissued Common
Stock a sufficient number of shares to provide for the issuance of Common Stock
upon the exercise of any purchase rights under this Warrant.  The
Company further covenants that its issuance of this Warrant shall constitute
full authority to its officers who are charged with the duty of executing stock
certificates to execute and issue the necessary certificates for shares of the
Company’s Common Stock upon the exercise of the purchase rights under this
Warrant.

       

      13.           Miscellaneous.

       

      (a)           Issue
Date.  The provisions of this Warrant shall be construed and
shall be given effect in all respect as if it had been issued and delivered by
the Company on the date hereof.  This Warrant shall be binding upon
any successors or assigns of the Company.  This Warrant shall
constitute a contract under the laws of the State of California and for all
purposes shall be construed in accordance with and governed by the laws of said
state.

       

      (b)           Restrictions.  The
holder hereof acknowledges that the Common Stock acquired upon the exercise of
this Warrant may have restrictions upon its resale imposed by state and federal
securities laws.

       

      (c)           Entire Agreement and
Amendments.  This Warrant constitutes the entire agreement of
the parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and the Holder
with respect to the subject matter hereof, and may not be modified adversely to
the Holder’s interest except by means of a writing signed by the Company and the
Holder.

       

      (d)           Notices.  Unless
otherwise provided, any notice required or permitted under this Warrant shall be
given in writing and shall be deemed effectively given as hereinafter described
(i) if given by personal delivery, then such notice shall be deemed given upon
such delivery, (ii) if given by telex, facsimile or e-mail, then such notice
shall be deemed given upon receipt of confirmation of complete transmittal,
(iii) if given by mail, then such notice shall be deemed given upon the earlier
of (A) receipt of such notice by the recipient or (B) three days after such
notice is deposited in first class mail, postage prepaid, and (iv) if given by
an internationally recognized overnight air courier, then such notice shall be
deemed given one business day after delivery to such carrier.  All
notices shall be addressed as follows: if to the Holder of the Warrant, at its
address as set forth in the Company’s books and records and, if to the Company,
at the address as follows, or at such other address as the Holder of the
Warrant, or the Company may designate by ten days’ advance written notice to the
other:

       

      
        
           

        

        
          19

          
            

          

        

        
           

        

      

       

      If to the
Company:

       

      Balqon
Corporation

      1701 E.
Edinger, Unit E-3

      Santa
Ana, California 92705

      If to
Holder:

       

      ________________________________

       

      ________________________________

       

      ________________________________

       

      (e)           Binding Agreement;
Assignment.  The terms and conditions of this Warrant shall
inure to the benefit of and be binding upon the respective successors and
permitted assigns of the parties.  Nothing in this Warrant, express or
implied, is intended to confer upon any third party any rights, remedies,
obligations, or liabilities under or by reason of this Warrant.  This
Warrant may not be assigned by Holder (other than to a Related Person) without
the prior written consent of the Company.  “Related Person” shall
mean with respect to any Holder (i) any affiliate of such person, (ii) any
investment fund, investment account or investment entity whose investment
manager, investment advisor or general partner, is such Holder or any affiliate
of such Holder or any member, partner, officer or employee of such Holder or any
affiliate of such Holder, (iii) any member or partner of any Holder specified in
clause (i) or (ii) above, and (iv) any officer or employee of any person
specified in clause (i), (ii) or (iii) above.

       

      (signature
page follows)

       

      
        
           

        

        
          20

          
            

          

        

        
           

        

      

       

      IN
WITNESS WHEREOF, BALQON CORPORATION has caused this Warrant to be executed by
its officers thereunto duly authorized.

       

      
        
          
            	 	BALQON
      CORPORATION	 
	 	 	 	 
	
                    Date

                  	
                    By:
      

                  	 	 
	 	 	Balwinder
      Samra, President	 

          

        

         

        
          	Name
      of Holder: 	 Marlin Financial
      Group  	 	 	 	 
	 	 	 	 	 	 
	 	
                   

                	 	 	
                   

                	 
	      
                  (Signature)

                	
                   

                	 	 	
                   

                	 
	 	
                   

                	 	 	
                   

                	 
	Address: 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	Telephone:  	 	 	 	 	 
	Facsimile:   	 	 	 	 	 

        

         

      

      
        
           

        

        
          21

          
            

          

        

        
           

        

      

       

      NOTICE OF
EXERCISE

       

      To:           BALQON
CORPORATION

       

      (1)           The
undersigned hereby elects to purchase ____________ shares of Common
Stock  of BALQON CORPORATION pursuant to the provisions of Section 3(a) of
the attached Warrant, and tenders herewith payment of the purchase price for
such shares in full.

       

      (2)           In
exercising this Warrant, the undersigned hereby confirms and acknowledges that
the shares of Common Stock to be issued upon exercise thereof are being acquired
solely for the account of the undersigned and not as a nominee for any other
party, and for investment, and that the undersigned will not offer, sell or
otherwise dispose of any such shares of Common Stock except under circumstances
that will not result in a violation of the Securities Act, or any applicable
state securities laws.

       

      (3)           In
exercising this Warrant, the undersigned hereby affirms that the representations
and warranties contained in Section 2 of
this Warrant are true and correct in all material respects.

       

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

       

      
        
          	
                   

                	 	 	
                   

                	 

        

        
          	 	 	 	      
                  Name 

                	 
	 	 	 	 	 
	
                   

                	 	 	
                   

                	 
	
                   

                	 	 	
                  Name 

                	 

        

      

       

      (5)           Please
issue a new Warrant for the unexercised portion of the attached Warrant in the
name of the undersigned or in such other name as is specified
below:

       

      
        
          
            	
                     

                  	 	 	
                     

                  	 

          

          
            	 	 	 	      
                    Name 

                  	 
	 	 	 	 	 
	
                     

                  	 	 	
                     

                  	 
	
                    (Date)

                  	 	 	
                    Signature

                  	 

          

        

         

        
          
             

          

          
            22

            
              

            

          

          
             

          

        

      

       

      ASSIGNMENT
FORM

       

      FOR VALUE
RECEIVED, the undersigned registered owner of this Warrant hereby sells, assigns
and transfers unto the Assignee named below all of the rights of the undersigned
under the within Warrant, with respect to the number of shares of Common Stock
set forth below:

      
        	
                
                   

                  Name
      of Assignee

                

              	
                
                   

                  Address

                

              	
                
                   

                  No.
      of Shares

                

              
	 
      	 
      	 
      
	 
      	 
      	 
      

      

       

      and does
hereby irrevocable constitute and appoint _______________________ Attorney to
make such transfer on the books of BALQON CORPORATION, maintained for the
purpose, with full power of substitution in the premises.

       

      The
undersigned also represents that, by assignment hereof, the Assignee
acknowledges that this Warrant and the shares of Common Stock to be issued upon
exercise hereof or conversion thereof are being acquired for investment and that
the Assignee will not offer, sell or otherwise dispose of this Warrant or any
shares of Common Stock to be issued upon exercise hereof or conversion thereof
except under circumstances which will not result in a violation of the
Securities Act or any state securities laws.  Further, the Assignee
has acknowledged that upon exercise of this Warrant, the Assignee shall, if
requested by the Company, confirm in writing, in a form satisfactory to the
Company, that the shares of Common Stock so purchased are being acquired for
investment and not with a view toward distribution or resale.

       

      
        
          
            
              
                	Dated:	
                         

                      	 	 	
                         

                      	 

              

              
                	 	 	 	      
                              
                          Signature
      of Holder

                        

                      	 

              

            

             

          

        

      

      
        
           

        

        
          23

          
            

          

        

        
           

        

      

       

      NEITHER
THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON THE EXERCISE OF THESE
SECURITIES HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS.  THE SECURITIES
REPRESENTED HEREBY MAY NOT BE EXERCISED, OFFERED, SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE ASSIGNED (EACH A “TRANSFER”) EXCEPT (A)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSFER NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (B) TO THE EXTENT THE
TRANSFER DOES NOT CONSTITUTE AND WILL NOT RESULT IN A VIOLATION OF APPLICABLE
FEDERAL OR STATE SECURITIES LAWS, AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
THE TRANSFEROR TO SUCH EFFECT (TO THE EXTENT REQUESTED BY COUNSEL OF THE
COMPANY), THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY.  THE HOLDER HEREOF AGREES THAT IT WILL DELIVER, OR CAUSE TO
BE DELIVERED, TO EACH PERSON TO WHOM THE SECURITIES HEREBY REPRESENTED ARE
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND.  THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE OF
THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
SECURED BY SUCH SECURITIES.

       

      

      STOCK
PURCHASE WARRANT

      

      BALQON
CORPORATION

       

      

       

      Original
Issue Date: June 4, 2008

       

      THIS
CERTIFIES that, for value received, Marlin Financial Group (the “Holder”), is
entitled, upon the terms and subject to the conditions hereinafter set forth, to
subscribe for and purchase, from BALQON CORPORATION, a California corporation
(the “Company”), at any
time upon the terms and subject to the conditions set forth herein, from the
Company, 243,060 shares of common stock (“Common Stock”) of the
Company (the “Warrant
Shares”).  The exercise price of one share of Common Stock
under this Warrant shall be $2.50 (“Exercise Price”),
subject to adjustment as provided herein.  If the purchase rights
represented by this Warrant are not exercised before the close of business on
the day preceding June 30, 2012, this Warrant shall be void.

       

      1.           Title of
Warrant.  Prior to the expiration hereof and subject to
compliance with applicable laws, this Warrant and all rights hereunder are
transferable, in whole or in part, at the office or agency of the Company,
referred to in Section 3
hereof, by the holder hereof in person or by duly authorized attorney, upon
surrender of this Warrant together with the Assignment Form annexed hereto
properly endorsed.

       

      
        
           

        

        
          24

          
            

          

        

        
           

        

      

       

      2.           Investment
Representations.

       

      (a)           Holder
confirms that it has been given sufficient access to information regarding the
Company and in connection with its decision to receive this Warrant, including
any common stock issuable upon the exercise of this Warrant (collectively, the
“Securities”),
including the opportunity to ask questions of, and receive answers from, persons
acting on behalf of Company and concerning Company’s financial affairs,
prospects and condition.

       

      (b)           Holder
represents and warrants that (i) it is resident in or otherwise subject to the
securities legislation of the United States, and the issuance of the Securities
to Holder has occurred only in the United States; (ii) Holder, by reason of its
business or financial expertise, has the capacity to protect its own interests
in connection with its acquisition of the Securities; and (iii) Holder is an
“accredited investor” as defined in Rule 501 of Regulation D of the Securities
Act of 1933, as amended (the “Securities
Act”).

       

      (c)           Holder
represents, warrants and covenants that it shall acquire the Securities for its
own account and not for the account or on behalf of others, and it is doing so
with the intent of retaining such Securities as an investment and without the
current intent to redistribute such Securities.

       

      (d)           Holder
acknowledges that: (i) no securities commission or similar authority has
reviewed or passed on the merits of the Securities; (ii) there is no government
or other insurance covering such Securities; and (iii) there are risks
associated with the acquisition of the Securities.

       

      (e)           Holder
acknowledges that (i) it must and shall bear the economic risk of holding the
Securities, which may be for an indefinite period of time, because at the time
such Securities are issued they will not have been registered under the
Securities Act or any other securities law and, therefore, cannot be sold unless
they are subsequently registered under applicable federal and state securities
laws or an exemption from such registration is available; (ii) the Securities
may not be resold or transferred on the official stock transfer records of
Company without furnishing to Company an opinion of counsel reasonably
acceptable to Company that such sale or transfer of the Securities will not
violate the registration provisions of applicable federal and state securities
laws; and (iii) certificates representing the Securities shall have endorsed on
them a restrictive legend to this effect.

       

      (f)           Holder
acknowledges that Company is relying on the representations, warranties,
covenants and acknowledgments in this Section 2 to
ensure that the Securities can be issued in reliance on exemptions from
registration requirements under United States federal and state securities
laws.

       

      3.           Exercise of
Warrant.

       

      (a)           The
purchase rights represented by this Warrant are exercisable by the Holder by the
surrender of this Warrant and the Notice of Exercise annexed hereto duly
completed and executed on behalf of the Holder, at the office of the Company (or
such other office or agency of the Company as it may designate by notice in
writing to the Holder at the address of the Holder appearing on the books of the
Company), upon payment in cash, certified check or wire transfer of funds, of
the aggregate Exercise Price for that number of Warrant Shares then being
purchased.

       

      
        
           

        

        
          25

          
            

          

        

        
           

        

      

       

      (b)           This
Warrant shall be deemed to have been exercised immediately prior to the close of
business on the date of its surrender for exercise as provided above, and the
person entitled to receive the shares of Common Stock issuable upon such
exercise shall be treated for all purposes as the holder of record of such
shares as of the close of business on such date.  As promptly as
practicable on or after such date and in any event within ten (10) days
thereafter, the Company at its expense shall issue and deliver to the person or
persons entitled to receive the same a certificate or certificates for the
number of shares issuable upon such exercise.  In the event that this
Warrant is exercised in part, the Company at its expense will execute and
deliver a new Warrant of like tenor exercisable for the number of shares for
which this Warrant may then be exercised.  Each exercise hereof shall
constitute the reaffirmation by the holder hereof that the representations and
warranties contained in Section 2 of
this Warrant true and correct in all material respects with respect to the
Holder of the Warrant as of the time of such exercise.

       

      4.           No Fractional Shares or
Scrip.  No fractional shares or scrip representing fractional
shares shall be issued upon the exercise of this Warrant.  With
respect to any fraction of a share called for upon the exercise of this Warrant,
an amount equal to such fraction multiplied by the then current price at which
each share may be purchased hereunder shall be paid in cash to the holder of
this Warrant.

       

      5.           Charges, Taxes and
Expenses.  Issuance of certificates for shares of Common Stock
upon the exercise of this Warrant shall be made without charge to the holder
hereof for any issue or transfer tax or other incidental expense in respect of
the issuance of such certificate, all of which taxes and expenses shall be paid
by the Company, and such certificates shall be issued in the name of the holder
of this Warrant or in such name or names as may be directed by the holder of
this Warrant; provided, however, that in the event certificates for shares of
Common Stock are to be issued in a name other than the name of the holder of
this Warrant, this Warrant when surrendered for exercise shall be accompanied by
the Assignment Form attached hereto duly executed by the holder hereof; and
provided further, that upon any transfer involved in the issuance or delivery of
any certificates for shares of Common Stock, the Company may require, as a
condition thereto, the payment of a sum sufficient to reimburse it for any
transfer tax incidental thereto.  The Holder of the Warrant shall be
responsible for income taxes due under federal, state, or other law, if any, if
any such tax is due.

       

      6.           No Rights as
Stockholders.  This Warrant does not entitle the holder hereof
to any voting rights or other rights as a stockholder of the Company prior to
the exercise thereof.  Nothing in this Warrant shall be construed to
give any person, firm or corporation (other than the Company and the Holder of
this Warrant) any legal or equitable right, remedy or claim, it being agreed
that this Warrant shall be for the sole and exclusive benefit of the Company and
the Holder of this Warrant.

       

      7.           Exchange and Registry of
Warrant.  This Warrant is exchangeable, upon the surrender
hereof by the registered holder at the above-mentioned office or agency of the
Company, for a new Warrant of like tenor and dated as of such
exchange.  The Company shall maintain at the above-mentioned office or
agency a registry showing the name and address of the registered holder of this
Warrant.  This Warrant may be surrendered for exchange, transfer or
exercise, in accordance with its terms, at such office or agency of the Company,
and the Company shall be entitled to rely in all respects, prior to written
notice to the contrary, upon such registry.

       

      
        
           

        

        
          26

          
            

          

        

        
           

        

      

       

      8.           Loss, Theft, Destruction or
Mutilation of Warrant.  Upon receipt by the Company of evidence
reasonably satisfactory to it of the loss, theft, destruction or mutilation of
this Warrant, and in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to it, and upon reimbursement to the Company of
all reasonable expenses incidental thereto, and upon surrender and cancellation
of this Warrant, if mutilated, the Company will make and deliver a new Warrant
of like tenor and dated as of such cancellation, in lieu of this
Warrant.

       

      9.           Saturdays, Sundays,
Holidays, etc.  If the last or appointed day for the taking of
any action or the expiration of any right required or granted herein shall be a
Saturday or a Sunday or shall be a legal holiday, then such action may be taken
or such right may be exercised on the next succeeding day not a legal
holiday.

       

      10.           Transferability and
Nonnegotiability of Warrant.  This Warrant may not be
transferred or assigned in whole or in part without compliance with all
applicable federal and state securities laws by the transferor and the
transferee (including the delivery of investment representation letters and
legal opinions reasonably satisfactory to the Company, if such are requested by
the Company).  Subject to the provisions of this Warrant with respect
to compliance with the Securities Act, title to this Warrant may be transferred
by endorsement (by the Holder executing the Assignment Form annexed hereto) and
delivery in the same manner as a negotiable instrument transferable by
endorsement and delivery.

       

      11.           Compliance With Securities
Laws.

       

      (a)           The
Holder of this Warrant represents and warrants that this Warrant and the shares
of Common Stock to be issued upon exercise hereof are being acquired solely for
the Holder’s own account and not as a nominee for any other party, and for
investment, and that the Holder will not offer, sell or otherwise dispose of
this Warrant or any shares of Common Stock to be issued upon exercise hereof
except under circumstances that will not result in a violation of the Securities
Act or any state securities laws.  Upon exercise of this Warrant, the
Holder shall, if requested by the Company, confirm in writing, in a form
satisfactory to the Company, that the shares of Common Stock so purchased are
being acquired solely for the Holder’s own account and not as a nominee for any
other party, for investment, and not with a view toward distribution or
resale.

       

      (b)           This
Warrant and all shares of Common Stock issued upon exercise hereof shall be
stamped or imprinted with a legend in substantially the following form (in
addition to any legend required by state securities laws):

       

      
        
           

        

        
          27

          
            

          

        

        
           

        

      

       

      NEITHER
THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON THE EXERCISE OF THESE
SECURITIES HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS.  THE SECURITIES
REPRESENTED HEREBY MAY NOT BE EXERCISED, OFFERED, SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE ASSIGNED (EACH A “TRANSFER”) EXCEPT (A)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSFER NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (B) TO THE EXTENT THE
TRANSFER DOES NOT CONSTITUTE AND WILL NOT RESULT IN A VIOLATION OF APPLICABLE
FEDERAL OR STATE SECURITIES LAWS, AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
THE TRANSFEROR TO SUCH EFFECT (TO THE EXTENT REQUESTED BY COUNSEL OF THE
COMPANY), THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY.  THE HOLDER HEREOF AGREES THAT IT WILL DELIVER, OR CAUSE TO
BE DELIVERED, TO EACH PERSON TO WHOM THE SECURITIES HEREBY REPRESENTED ARE
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND.  THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE OF
THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
SECURED BY SUCH SECURITIES.

       

      12.           Early Termination and
Reclassification.

       

      (a)           Merger, Sale of Assets,
etc.  If all or any portion of this Warrant is exercised
subsequent to a merger, consolidation, exchange of shares, reorganization, or
other similar event (“Change in Control”)
occurring after the date hereof, as a result of which shares shall be changed
into cash, other property, or the same or a different number of shares of the
same or another class or classes of securities of the Company or another entity,
the Holder exercising this Warrant shall receive, for the exercise price, the
aggregate amount of cash or other property and the aggregate number of shares
and class of securities which the Holder would have received if this Warrant was
exercised immediately before the Change in Control.  If an adjustment
under this section would create a fractional share or a right to acquire a
fractional share, the fractional share will be rounded up to, and issued as, a
whole share.  If, pursuant to a Change of Control event, the shares
shall be exchanged solely for cash (in such case, a “Triggering Event”),
then the Company shall give the Holder written notice describing the material
terms and conditions of such impending transaction not later than ten (10) days
prior to the stockholders’ meeting called to approve such transaction (or such
longer period if required by the General Corporation Law of the State of
California), or ten (10) days prior to the closing of such transaction (or such
longer period if required by the General Corporation Law of the State of
California), whichever is earlier, and shall also notify the holder of this
Warrant of the final approval of such transaction.

       

      (b)           Reclassification,
etc.  If the Company at any time shall, by subdivision,
combination or reclassification of securities or otherwise, change any of the
securities to which purchase rights under this Warrant exist into the same or a
different number of securities of any class or classes, this Warrant shall
thereafter be to acquire such number and kind of securities as would have been
issuable as the result of such change with respect to the securities which were
subject to the purchase rights under this Warrant immediately prior to such
subdivision, combination, reclassification or other change.  If shares
of the Company’s Common Stock are subdivided or combined into a greater or
smaller number of shares of Common Stock, the purchase price under this Warrant
shall be proportionately reduced in case of subdivision of shares or
proportionately increased in the case of combination of shares and the number of
shares of Common Stock purchasable under this Warrant shall be proportionally
increased in the case of a subdivision and decreased in the case of combination,
in all cases by the ratio which the total number of shares of Common Stock to be
outstanding immediately after such event bears to the total number of shares of
Common Stock outstanding immediately prior to such event.

       

      
        
           

        

        
          28

          
            

          

        

        
           

        

      

       

      (c)           Cash
Distributions.  No adjustment on account of cash dividends or
interest on the Company’s Common Stock or other securities purchasable hereunder
will be made to the purchase price under this Warrant .

       

      (d)           Authorized
Shares.  The Company covenants that during the period the
Warrant is outstanding, it will reserve from its authorized and unissued Common
Stock a sufficient number of shares to provide for the issuance of Common Stock
upon the exercise of any purchase rights under this Warrant.  The
Company further covenants that its issuance of this Warrant shall constitute
full authority to its officers who are charged with the duty of executing stock
certificates to execute and issue the necessary certificates for shares of the
Company’s Common Stock upon the exercise of the purchase rights under this
Warrant.

       

      13.           Miscellaneous.

       

      (a)           Issue
Date.  The provisions of this Warrant shall be construed and
shall be given effect in all respect as if it had been issued and delivered by
the Company on the date hereof.  This Warrant shall be binding upon
any successors or assigns of the Company.  This Warrant shall
constitute a contract under the laws of the State of California and for all
purposes shall be construed in accordance with and governed by the laws of said
state.

       

      (b)           Restrictions.  The
holder hereof acknowledges that the Common Stock acquired upon the exercise of
this Warrant may have restrictions upon its resale imposed by state and federal
securities laws.

       

      (c)           Entire Agreement and
Amendments.  This Warrant constitutes the entire agreement of
the parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and the Holder
with respect to the subject matter hereof, and may not be modified adversely to
the Holder’s interest except by means of a writing signed by the Company and the
Holder.

       

      (d)           Notices.  Unless
otherwise provided, any notice required or permitted under this Warrant shall be
given in writing and shall be deemed effectively given as hereinafter described
(i) if given by personal delivery, then such notice shall be deemed given upon
such delivery, (ii) if given by telex, facsimile or e-mail, then such notice
shall be deemed given upon receipt of confirmation of complete transmittal,
(iii) if given by mail, then such notice shall be deemed given upon the earlier
of (A) receipt of such notice by the recipient or (B) three days after such
notice is deposited in first class mail, postage prepaid, and (iv) if given by
an internationally recognized overnight air courier, then such notice shall be
deemed given one business day after delivery to such carrier.  All
notices shall be addressed as follows: if to the Holder of the Warrant, at its
address as set forth in the Company’s books and records and, if to the Company,
at the address as follows, or at such other address as the Holder of the
Warrant, or the Company may designate by ten days’ advance written notice to the
other:

       

      
        
           

        

        
          29

          
            

          

        

        
           

        

      

       

      If to the
Company:

       

      Balqon
Corporation

      1701 E.
Edinger, Unit E-3

      Santa
Ana, California 92705

      If to
Holder:

       

      ________________________________

       

      ________________________________

       

      ________________________________

       

      (e)           Binding Agreement;
Assignment.  The terms and conditions of this Warrant shall
inure to the benefit of and be binding upon the respective successors and
permitted assigns of the parties.  Nothing in this Warrant, express or
implied, is intended to confer upon any third party any rights, remedies,
obligations, or liabilities under or by reason of this Warrant.  This
Warrant may not be assigned by Holder (other than to a Related Person) without
the prior written consent of the Company.  “Related Person” shall
mean with respect to any Holder (i) any affiliate of such person, (ii) any
investment fund, investment account or investment entity whose investment
manager, investment advisor or general partner, is such Holder or any affiliate
of such Holder or any member, partner, officer or employee of such Holder or any
affiliate of such Holder, (iii) any member or partner of any Holder specified in
clause (i) or (ii) above, and (iv) any officer or employee of any person
specified in clause (i), (ii) or (iii) above.

       

      (signature
page follows)

       

      
        
           

        

        
          30

          
            

          

        

        
           

        

      

       

      IN
WITNESS WHEREOF, BALQON CORPORATION has caused this Warrant to be executed by
its officers thereunto duly authorized.

       

      
        
          
            
              	 	BALQON
      CORPORATION	 
	 	 	 	 
	
                      Date

                    	
                      By:
      

                    	 	 
	 	 	Balwinder
      Samra, President	 

            

          

           

          
            	Name
      of Holder: 	 Marlin Financial
      Group  	 	 	 	 
	 	 	 	 	 	 
	 	
                     

                  	 	 	
                     

                  	 
	      
                    (Signature)

                  	
                     

                  	 	 	
                     

                  	 
	 	
                     

                  	 	 	
                     

                  	 
	Address: 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	Telephone:  	 	 	 	 	 
	Facsimile:   	 	 	 	 	 

          

           

          
            
               

            

            
              31

              
                

              

            

            
               

            

          

        

      

       

      NOTICE OF
EXERCISE

       

      To:           BALQON
CORPORATION

       

      (1)           The
undersigned hereby elects to purchase ____________ shares of Common
Stock  of BALQON CORPORATION pursuant to the provisions of Section 3(a) of
the attached Warrant, and tenders herewith payment of the purchase price for
such shares in full.

       

      (2)           In
exercising this Warrant, the undersigned hereby confirms and acknowledges that
the shares of Common Stock to be issued upon exercise thereof are being acquired
solely for the account of the undersigned and not as a nominee for any other
party, and for investment, and that the undersigned will not offer, sell or
otherwise dispose of any such shares of Common Stock except under circumstances
that will not result in a violation of the Securities Act, or any applicable
state securities laws.

       

      (3)           In
exercising this Warrant, the undersigned hereby affirms that the representations
and warranties contained in Section 2 of
this Warrant are true and correct in all material respects.

       

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

       

      
        
          	
                   

                	 	 	
                   

                	 

        

        
          	 	 	 	      
                  Name 

                	 
	 	 	 	 	 
	
                   

                	 	 	
                   

                	 
	
                   

                	 	 	
                  Name 

                	 

        

      

       

      (5)           Please
issue a new Warrant for the unexercised portion of the attached Warrant in the
name of the undersigned or in such other name as is specified
below:

       

      
        
          
            	
                     

                  	 	 	
                     

                  	 

          

          
            	 	 	 	      
                    Name 

                  	 
	 	 	 	 	 
	
                     

                  	 	 	
                     

                  	 
	
                    (Date)

                  	 	 	
                    Signature

                  	 

          

        

         

        
          
             

          

          
            32

            
              

            

          

          
             

          

        

      

       

      ASSIGNMENT
FORM

       

      FOR VALUE
RECEIVED, the undersigned registered owner of this Warrant hereby sells, assigns
and transfers unto the Assignee named below all of the rights of the undersigned
under the within Warrant, with respect to the number of shares of Common Stock
set forth below:

      
        	
                
                   

                  Name
      of Assignee

                

              	
                
                   

                  Address

                

              	
                
                   

                  No.
      of Shares

                

              
	 
      	 
      	 
      
	 
      	 
      	 
      

      

       

      and does
hereby irrevocable constitute and appoint _______________________ Attorney to
make such transfer on the books of BALQON CORPORATION, maintained for the
purpose, with full power of substitution in the premises.

       

      The
undersigned also represents that, by assignment hereof, the Assignee
acknowledges that this Warrant and the shares of Common Stock to be issued upon
exercise hereof or conversion thereof are being acquired for investment and that
the Assignee will not offer, sell or otherwise dispose of this Warrant or any
shares of Common Stock to be issued upon exercise hereof or conversion thereof
except under circumstances which will not result in a violation of the
Securities Act or any state securities laws.  Further, the Assignee
has acknowledged that upon exercise of this Warrant, the Assignee shall, if
requested by the Company, confirm in writing, in a form satisfactory to the
Company, that the shares of Common Stock so purchased are being acquired for
investment and not with a view toward distribution or resale.

       

      
        
          
            
              
                
                  	Dated:	
                           

                        	 	 	
                           

                        	 

                

                
                  	 	 	 	      
                                
                            Signature
      of Holder

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