WARRANT AGREEMENT
EXHIBIT
4.5
This
Warrant Agreement, dated as
of ,
2008 (the “Agreement”) by and between China Fundamental Acquisition
Corporation., a corporation organized under the laws of the Cayman Islands
(the
“Company”), with offices at Xxxx 0000, World-Wide House, 00 Xxx Xxxxx Xxxx,
Xxxxxxx, Xxxx Xxxx, and Continental Stock Transfer & Trust Company, a New
York corporation (the “Warrant Agent”), with offices at 00 Xxxxxxx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000.
WHEREAS,
the Company is engaged in a public offering (the “Public Offering”) of 3,750,000
Units (“Units”) of the Company, each Unit consisting of one ordinary Share, par
value $0.001 per share (the “Ordinary Share”) and one warrant to purchase one
Ordinary Share (the “Warrant”) and, in connection therewith, has determined to
issue and deliver up to 3,750,000 Warrants (the “Public Warrants”) to the public
investors;
WHEREAS,
in connection with the Company’s formation, the Company has issued 1,078,125
Ordinary Shares and 1,078,125 Warrants to certain initial shareholders (the
“Existing Shareholder Warrants”);
WHEREAS,
the Company has heretofore engaged in a private offering (the “Private
Offering”) of 1,944,444 warrants (the “Private Placement Warrants”) of the
Company to various investors;
WHEREAS,
in connection with the Public Offering, the Company has determined to sell
and
deliver to Chardan Capital Markets, LLC (“Chardan”) and Maxim Group LLC, as
underwriters (the “Underwriters”), options to purchase in the
aggregate 225,000 Units of the Company, which Units contain 225,000
Warrants (the “Underwriter Warrants”);
WHEREAS,
the Company has filed with the Securities and Exchange Commission (the “SEC”) a
Registration Statement, No.
333-
on Form F-1 for the registration, under the Securities Act of 1933, as amended
(the “Act”) of, among other securities, the Public Warrants and the Ordinary
Shares issuable upon exercise of the Public Warrants and the Underwriter
Warrants and the Ordinary Shares issuable upon exercise of the Underwriter
Warrants;
WHEREAS,
the Company desires the Warrant Agent to act on behalf of the Company, and
the
Warrant Agent is willing to so act, in connection with the issuance,
registration, transfer, exchange, redemption and exercise of the Warrants;
WHEREAS,
the Company desires to provide for the form and provisions of the Warrants,
the
terms upon which they shall be issued and exercised, and the respective rights,
limitation of rights, and immunities of the Company, the Warrant Agent, and
the
holders of the Public Warrants, the Existing Shareholder Warrants, the Private
Placement Warrants and the Underwriter Warrants (each, the “Warrant”;
collectively, the “Warrants”); and
WHEREAS,
all acts and things have been done and performed which are necessary to make
the
Warrants, when executed on behalf of the Company and countersigned by or on
behalf of the Warrant Agent, as provided herein, the valid, binding and legal
obligations of the Company, and to authorize the execution and delivery of
this
Agreement.
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NOW,
THEREFORE, in consideration of the mutual agreements herein contained, the
parties hereto agree as follows:
1. Appointment
of Warrant Agent. The Company hereby appoints the Warrant Agent to act as agent
for the Company for the Warrants, and the Warrant Agent hereby accepts such
appointment and agrees to perform the same in accordance with the terms and
conditions set forth in this Agreement.
2. Warrants.
2.1 Form
of Warrant.
Each
Warrant shall be issued in registered form only, shall be in substantially
the
form of Exhibit
A
hereto,
the provisions of which are incorporated herein and shall be signed by, or
bear
the facsimile signature of, the Chief Executive Officer and/or President of
the
Company and shall bear a facsimile of the Company’s seal. In the event the
person whose facsimile signature has been placed upon any Warrant shall have
ceased to serve in the capacity in which such person signed the Warrant before
such Warrant is issued, it may be issued with the same effect as if he or she
had not ceased to be such at the date of issuance.
2.2 Effect
of Countersignature.
Unless
and until countersigned by the Warrant Agent pursuant to this Agreement, a
Warrant shall be invalid and of no effect and may not be exercised by the holder
thereof.
2.3 Registration.
2.3.1 Warrant
Register.
The
Warrant Agent shall maintain books (“Warrant Register”), for the registration of
original issuance and the registration of transfer of the Warrants. Upon the
initial issuance of the Warrants, the Warrant Agent shall issue and register
the
Warrants in the names of the respective holders thereof in such denominations
and otherwise in accordance with instructions delivered to the Warrant Agent
by
the Company.
2.3.2 Registered
Holder.
Prior
to due presentment for registration of transfer of any Warrant, the Company
and
the Warrant Agent may deem and treat the person in whose name such Warrant
shall
be registered upon the Warrant Register (“registered holder”), as the absolute
owner of such Warrant and of each Warrant represented thereby (notwithstanding
any notation of ownership or other writing on the Warrant Certificate made
by
anyone other than the Company or the Warrant Agent), for the purpose of any
exercise thereof, and for all other purposes, and neither the Company nor the
Warrant Agent shall be affected by any notice to the contrary.
2.4 Detachability
of Public Warrants.
The
Public Warrants and Ordinary Shares comprising the Units will begin separate
trading on the 90th
day
after the date hereof unless Chardan informs the Company of its decision to
allow earlier trading, subject to the Company’s having filed the Current Report
on Form 6-K and having issued a press release announcing when such separate
trading will begin, but in no event will Chardan allow separate trading of
the
Public Warrants and Ordinary Shares comprising the Units until the Company
files
with the SEC a Current Report on Form 6-K which includes an audited balance
sheet reflecting the receipt by the Company of the gross proceeds of the Public
Offering including the proceeds received by the Company from the exercise of
the
Underwriters’ Over-allotment Option, if the over-allotment option is exercised
prior to the filing of the Form 6-K.
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2.5 Private
Placement Warrants.
The
Private Placement Warrants may not be transferred until the consummation of
the
Business Combination (as defined in the Registration Statement).
3. Terms
and Exercise of Warrants
3.1 Warrant
Price.
Each
Warrant shall, when countersigned by the Warrant Agent, entitle the registered
holder thereof, subject to the provisions of such Warrant and of this Warrant
Agreement, to purchase from the Company the number of Ordinary Shares, at the
price of $5.00 per Ordinary Share, subject to the adjustments provided in
Section 4 hereof and in the last sentence of this Section 3.1. The term “Warrant
Price” as used in this Warrant Agreement refers to the price per share at which
Ordinary Shares may be purchased at the time a Warrant is exercised. The Company
in its sole discretion may lower the Warrant Price at any time prior to the
Expiration Date; provided, that any such reduction shall be identical in
percentage terms among all of the Warrants.
3.2 Duration
of Warrants.
A
Warrant may be exercised only during the period (“Exercise Period”) commencing
on the later of (a) the consummation by the Company of a stock exchange, asset
acquisition or other similar business combination (“Business Combination”) (as
described more fully in the Company’s Registration Statement), or (b)
_____________, 2009, and terminating at 5:00 p.m., New York City time on the
earlier to occur of (i) ____________, 2012 or (ii) the date fixed for redemption
of the Warrants as provided in Section 6 of this Agreement (“Expiration Date”).
Except with respect to the right to receive the Redemption Price (as set forth
in Section 6 hereunder), each Warrant not exercised on or before the Expiration
Date shall become void, and all rights thereunder and all rights in respect
thereof under this Agreement shall cease at the close of business on the
Expiration Date. The Company in its sole discretion may extend the duration
of
the Warrants by delaying the Expiration Date; provided, however, that the
Company will provide notice to Registered Holders of the Warrants of such
extension of not less than 20 days.
3.3 Exercise
of Warrants.
3.3.1 Payment.
Subject
to the provisions of the Warrant and this Warrant Agreement, a Warrant, when
countersigned by the Warrant Agent, may be exercised by the registered holder
thereof by surrendering it, at the office of the Warrant Agent, or at the office
of its successor as Warrant Agent, in the Borough of Manhattan, City and State
of New York, with the subscription form, as set forth in the Warrant, duly
executed, and by paying in full, in lawful money of the United States, in cash,
good certified check or good bank draft payable to the order of the Company
(or
as otherwise agreed to by the Company), the Warrant Price for each full Ordinary
Share as to which the Warrant is exercised and any and all applicable taxes
due
in connection with the exercise of the Warrant, the exchange of the Warrant
for
the Ordinary Share, and the issuance of the Ordinary Share.
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3.3.2 Issuance
of Certificates.
As soon
as practicable after the exercise of any Warrant and the clearance of the funds
in payment of the Warrant Price, the Company shall issue to the registered
holder of such Warrant a certificate or certificates for the number of full
Ordinary Shares to which he is entitled, registered in such name or names as
may
be directed by him, her or it, and if such Warrant shall not have been exercised
in full, a new countersigned Warrant for the number of shares as to which such
Warrant shall not have been exercised. Subject to Section 7.4 and
notwithstanding the foregoing, the Company shall not be obligated to deliver
any
securities pursuant to the exercise of a Warrant unless (a) a registration
statement under the Act with respect to the Ordinary Shares issuable upon
exercise of such Warrants is effective and a current prospectus relating to
the
Ordinary Shares issuable upon exercise of the Warrants is available for delivery
to the Warrant holders or (b) in the opinion of counsel to the Company, the
exercise of the Warrants is exempt from the registration requirements of the
Act
and such securities are qualified for sale or exempt from qualification under
applicable securities laws of the states or other jurisdictions in which the
Registered Holder resides. Warrants may not be exercised by, or securities
issued to, any Registered Holder in any state in which such exercise or issuance
would be unlawful. In the event a registration statement under the Act with
respect to the Ordinary Shares underlying the Warrants is not effective or
a
prospectus is not available, or because such exercise would be unlawful with
respect to a Registered Holder in
any
state, the Registered Holder shall not be entitled to exercise such Warrants
and
such Warrants may have no value and expire worthless. In no event will the
Company be obligated to pay such Registered Holder any cash consideration upon
exercise (unless pursuant to Section 4.5) or otherwise “net cash settle” the
Warrant. In the event that a Registration Statement is not effective for the
exercised Warrants, the purchaser of a Unit containing such Warrants, will
have
paid the full purchase price for the Unit solely for the Ordinary Shares
included in such Unit.
3.3.3 Valid
Issuance.
All
Ordinary Shares issued upon the proper exercise of a Warrant in conformity
with
this Agreement shall be validly issued, fully paid and
nonassessable.
3.3.4 Date
of Issuance.
Each
person in whose name any such certificate for Ordinary Shares is issued shall
for all purposes be deemed to have become the holder of record of such shares
on
the date on which the Warrant was surrendered and payment of the Warrant Price
was made, irrespective of the date of delivery of such certificate, except
that,
if the date of such surrender and payment is a date when the stock transfer
books of the Company are closed, such person shall be deemed to have become
the
holder of such shares at the close of business on the next succeeding date
on
which the stock transfer books are open.
4. Adjustments.
4.1 Stock
Dividends - Split-Ups.
If
after the date hereof, and subject to the provisions of Section 4.6 below,
the
number of outstanding Ordinary Shares is increased by a stock dividend payable
in Ordinary Shares, or by a split-up of Ordinary Shares, or other similar event,
then, on the effective date of such stock dividend, split-up or similar event,
the number of Ordinary Shares issuable on exercise of each Warrant shall be
increased in proportion to such increase in outstanding Ordinary
Shares.
4.2 Aggregation
of Shares.
If
after the date hereof, and subject to the provisions of Section 4.6, the number
of outstanding Ordinary Shares is decreased by a consolidation, combination,
reverse stock split or reclassification of Ordinary Shares or other similar
event, then, on the effective date of such consolidation, combination, reverse
stock split, reclassification or similar event, the number of Ordinary Shares
issuable on exercise of each Warrant shall be decreased in proportion to such
decrease in outstanding Ordinary Shares.
4.3 Adjustments
in Exercise Price.
Whenever the number of Ordinary Shares purchasable upon the exercise of the
Warrants is adjusted, as provided in Section 4.1 and 4.2 above, the Warrant
Price shall be adjusted (to the nearest cent) by multiplying such Warrant Price
immediately prior to such adjustment by a fraction (x) the numerator of
which shall be the number of Ordinary Shares purchasable upon the exercise
of
the Warrants immediately prior to such adjustment, and (y) the denominator
of
which shall be the number of Ordinary Shares so purchasable immediately
thereafter.
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4.4 Extraordinary
Dividends.
If the
Company, at any time during the Exercise Period, shall pay a dividend in cash,
securities or other assets to the holders of Ordinary Shares (or other shares
of
the Company’s capital stock into which the Warrants are convertible), other than
(w) as described in Sections 4.1, 4.2 or 4.5, (x) regular quarterly or other
periodic dividends, (y) in connection with the conversion rights of the holders
of Ordinary Shares upon consummation of the Company’s Initial Business
Combination (as such term is used in the Company’s Amended and Restated
Certificate of Incorporation) or (z) in connection with the Company’s
liquidation and the distribution of its assets upon its failure to consummate
a
Business Combination (any such non-excluded event being referred to herein
as an
“Extraordinary Dividend”), then the Warrant Price shall be decreased, effective
immediately after the effective date of such Extraordinary Dividend, by the
amount of cash and/or the fair market value (as determined by the Company’s
Board of Directors, in good faith) of any securities or other assets paid on
each Ordinary Share in respect of such Extraordinary Dividend.
4.5 Replacement
of Securities upon Reorganization, etc.
In case
of any reclassification or reorganization of the outstanding Ordinary Shares
(other than a change covered by Section 4.1 or 4.2 hereof or that solely affects
the par value of such Ordinary Shares), or in the case of any consolidation
of
the Company with or into another corporation (other than a consolidation in
which the Company is the continuing corporation and that does not result in
any
reclassification or reorganization of the outstanding Ordinary Shares), or
in
the case of any sale or conveyance to another corporation or entity of the
assets or other property of the Company as an entirety or substantially as
an
entirety in connection with which the Company is dissolved, the Warrant holders
shall thereafter have the right to purchase and receive, upon the basis and
upon
the terms and conditions specified in the Warrants and in lieu of the Ordinary
Shares of the Company immediately theretofore purchasable and receivable upon
the exercise of the rights represented thereby, the kind and amount of shares
of
stock or other securities or property (including cash) receivable upon such
reclassification, reorganization, or consolidation, or upon a dissolution
following any such sale or transfer, that the Warrant holder would have received
if such Warrant holder had exercised his, her or its Warrant(s) immediately
prior to such event; and if any reclassification also results in a change in
Ordinary Shares covered by Section 4.1 or 4.2, then such adjustment shall be
made pursuant to Sections 4.1, 4.2, 4.3, 4.4 and this Section 4.5. The
provisions of this Section 4.5 shall similarly apply to successive
reclassifications, reorganizations, or consolidations, sales or other
transfers.
4.6 Notices
of Changes in Warrant.
Upon
every adjustment of the Warrant Price or the number of shares issuable upon
exercise of a Warrant, the Company shall give written notice thereof to the
Warrant Agent, which notice shall state the Warrant Price resulting from such
adjustment and the increase or decrease, if any, in the number of shares
purchasable at such price upon the exercise of a Warrant, setting forth in
reasonable detail the method of calculation and the facts upon which such
calculation is based. Upon the occurrence of any event specified in Sections
4.1, 4.2, 4.3, 4.4 or 4.5, then, in any such event, the Company shall give
written notice to the Warrant holder, at the last address set forth for such
holder in the warrant register, of the record date or the effective date of
the
event. Failure to give such notice, or any defect therein, shall not affect
the
legality or validity of such event.
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4.7 No
Fractional Shares.
Notwithstanding any provision contained in this Warrant Agreement to the
contrary, the Company shall not issue fractional shares upon exercise of
Warrants. If, by reason of any adjustment made pursuant to this Section 4,
the
holder of any Warrant would be entitled, upon the exercise of such Warrant,
to
receive a fractional interest in a share, the Company shall, upon such exercise,
round up to the nearest whole number the number of the Ordinary Shares to be
issued to the Warrant holder.
4.8 Form
of Warrant.
The
form of Warrant need not be changed because of any adjustment pursuant to this
Section 4, and Warrants issued after such adjustment may state the same Warrant
Price and the same number of shares as is stated in the Warrants initially
issued pursuant to this Agreement. However, the Company may at any time in
its
sole discretion make any change in the form of Warrant that the Company may
deem
appropriate and that does not affect the substance thereof, and any Warrant
thereafter issued or countersigned, whether in exchange or substitution for
an
outstanding Warrant or otherwise, may be in the form as so changed.
4.9 Notice
of Certain Transactions.
In the
event that the Company shall propose to (a) offer the holders of its Ordinary
Shares rights to subscribe for or to purchase any securities convertible into
Ordinary Shares or shares of stock of any class or any other securities, rights
or options, (b) issue any rights, options or warrants entitling the holders
of
Ordinary Shares to subscribe for Ordinary Shares or (c) make a tender offer,
redemption offer or exchange offer with respect to the Ordinary Shares, the
Company shall send to the Warrant holders a notice of such proposed action
or
offer. Such notice shall be mailed to the Registered Holders at their addresses
as they appear in the Warrant Register, which shall specify the record date
for
the purposes of such dividend, distribution or rights, or the date such issuance
or event is to take place and the date of participation therein by the holders
of Ordinary Shares, if any such date is to be fixed, and shall briefly indicate
the effect of such action on the Ordinary Shares and on the number and kind
of
any other shares of stock and on other property, if any, and the number of
Ordinary Shares and other property, if any, issuable upon exercise of each
Warrant and the Warrant Price after giving effect to any adjustment pursuant
to
this Article 4 which would be required as a result of such action. Such notice
shall be given as promptly as practicable after the Board has determined to
take
any such action and (x) in the case of any action covered by clause (a) or
(b)
above at least 10 days prior to the record date for determining the holders
of
the Ordinary Shares for purposes of such action or (y) in the case of any other
such action at least 20 days prior to the date of the taking of such proposed
action or the date of participation therein by the holders of Ordinary Shares,
whichever shall be the earlier.
4.10 Other
Events.
If any
event occurs as to which the foregoing provisions of this Article 4 are not
strictly applicable or, if strictly applicable, would not, in the good faith
judgment of the Company's board of directors (the "Board"), fairly and
adequately protect the purchase rights of the registered holders of the Warrants
in accordance with the essential intent and principles of such provisions,
then
the Board shall make such adjustments in the application of such provisions,
in
accordance with such essential intent and principles, as shall be reasonably
necessary, in the good faith opinion of the Board, to protect such purchase
rights as aforesaid.
5. Transfer
and Exchange of Warrants.
5.1 Registration
of Transfer.
The
Warrant Agent shall register the transfer, from time to time, of any outstanding
Warrant upon the Warrant Register, upon surrender of such Warrant for transfer,
properly endorsed with signatures properly guaranteed and accompanied by
appropriate instructions for transfer. Upon any such transfer, a new Warrant
representing an equal aggregate number of Warrants shall be issued and the
old
Warrant shall be cancelled by the Warrant Agent. The Warrants so cancelled
shall
be delivered by the Warrant Agent to the Company from time to time upon
request.
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5.2 Procedure
for Surrender of Warrants.
Warrants may be surrendered to the Warrant Agent, together with a written
request for exchange or transfer, and thereupon the Warrant Agent shall issue
in
exchange therefor one or more new Warrants as requested by the registered holder
of the Warrants so surrendered, representing an equal aggregate number of
Warrants; provided, however, that in the event that a Warrant surrendered for
transfer bears a restrictive legend, the Warrant Agent shall not cancel such
Warrant and issue new Warrants in exchange therefor until the Warrant Agent
has
received an opinion of counsel for the Company stating that such transfer may
be
made and indicating whether the new Warrants must also bear a restrictive
legend.
5.3 Fractional
Warrants.
The
Warrant Agent shall not be required to effect any registration of transfer
or
exchange which will result in the issuance of a warrant certificate for a
fraction of a warrant.
5.4 Service
Charges.
No
service charge shall be made for any exchange or registration of transfer of
Warrants.
5.5 Warrant
Execution and Countersignature.
The
Warrant Agent is hereby authorized to countersign and to deliver, in accordance
with the terms of this Agreement, the Warrants required to be issued pursuant
to
the provisions of this Section 5, and the Company, whenever required by the
Warrant Agent, will supply the Warrant Agent with Warrants duly executed on
behalf of the Company for such purpose.
5.6 Placement
Warrants.
Notwithstanding anything herein to the contrary, the Warrant Agent shall not
register for transfer any Placement Warrants until after the Initial Business
Combination, except for transfers (a) to an entity’s beneficiaries upon its
liquidation, (b) to relatives and trusts for estate planning purposes, (c)
pursuant to the laws of descent and distribution upon death, (d) pursuant to
a
qualified domestic relations order, (e) to officers, directors and employees
of
the Company and persons affiliated with the Company’s founders or (f) by private
sales with respect to up to 33% of the Ordinary Shares held by the holders
of
the Placement Warrants made at or prior to the consummation of a Business
Combination at prices no greater than the price at which the shares were
originally purchased; provided, however, that the permissive transfers set
forth
above may be implemented only upon the respective transferee’s written agreement
with the Company to be bound by the terms and conditions of such transfer
restrictions.
6. Redemption.
6.1 Redemption.
Subject
to Section 6.4 hereof, not less than all of the outstanding Warrants may be
redeemed, at the option of the Company, at any time after they become
exercisable and there is an effective Registration Statement covering the
Ordinary Shares issuable upon exercise of the Warrants current and available
and
prior to their expiration, at the office of the Warrant Agent, upon the notice
referred to in Section 6.2., at the price of $.01 per Warrant (“Redemption
Price”), provided that the last sales price of the Ordinary Shares has been at
least $10.00 per share, on each of twenty (20) trading days within any thirty
(30) trading day period ending on the third business day prior to the date
on
which notice of redemption is given. No Placement Warrants shall be redeemable
so long as such Placement Warrant is held in the name of the original person
or
entity to which the Company issued such Placement Warrant. Notwithstanding
anything to the contrary contained herein, the Company shall not call the
Warrants for redemption unless there is an effective registration statement
under the Act relating to the Ordinary Shares issuable upon exercise of the
Warrants current and available throughout the “30-day redemption period” and a
prospectus is available.
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6.2 Date
Fixed for, and Notice of, Redemption.
In the
event the Company shall elect to redeem all of the Warrants, the Company shall
fix a date for the redemption. Notice of redemption shall be mailed by first
class mail, postage prepaid, by the Company not less than 30 days prior to
the
date fixed for redemption to the registered holders of the Warrants to be
redeemed at their last addresses as they shall appear on the registration books.
Any notice mailed in the manner herein provided shall be conclusively presumed
to have been duly given whether or not the registered holder received such
notice.
6.3 Exercise
After Notice of Redemption.
The
Warrants may be exercised in accordance with Section 3 of this Agreement at
any
time after notice of redemption shall have been given by the Company pursuant
to
Section 6.2. hereof and prior to the time and date fixed for redemption. On
and
after the redemption date, the record holder of the Warrants shall have no
further rights except to receive, upon surrender of the Warrants, the Redemption
Price.
6.4 Outstanding
Warrants Only.
The
Company understands that the redemption rights provided for by this Section
6
apply only to outstanding Warrants. To the extent a person holds rights to
purchase Warrants, such purchase rights shall not be extinguished by redemption.
However, once such purchase rights are exercised, the Company may redeem the
Warrants issued upon such exercise provided that the criteria for redemption
is
met. The provisions of this Section 6.4 may not be modified, amended or deleted
without the prior written consent of Chardan.
7. Other
Provisions Relating to Rights of Holders of Warrants.
7.1 No
Rights as Stockholder.
A
Warrant does not entitle the registered holder thereof to any of the rights
of a
stockholder of the Company, including, without limitation, the right to receive
dividends, or other distributions, exercise any preemptive rights to vote or
to
consent or to receive notice as stockholders in respect of the meetings of
stockholders or the election of directors of the Company or any other
matter.
7.2 Lost,
Stolen, Mutilated, or Destroyed Warrants.
If any
Warrant is lost, stolen, mutilated, or destroyed, the Company and the Warrant
Agent may on such terms as to indemnity or otherwise as they may in their
discretion impose (which shall, in the case of a mutilated Warrant, include
the
surrender thereof), issue a new Warrant of like denomination, tenor, and date
as
the Warrant so lost, stolen, mutilated, or destroyed. Any such new Warrant
shall
constitute a substitute contractual obligation of the Company, whether or not
the allegedly lost, stolen, mutilated, or destroyed Warrant shall be at any
time
enforceable by anyone.
7.3 Reservation
of Ordinary Shares.
The
Company shall at all times reserve and keep available a number of its authorized
but unissued Ordinary Shares that will be sufficient to permit the exercise
in
full of all outstanding Warrants issued pursuant to this Agreement.
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7.4 Registration
of Ordinary Shares.
The
Company agrees that prior to the commencement of the Exercise Period, it shall
file with the Securities and Exchange Commission a post-effective amendment
to
the Registration Statement, or a new registration statement, for the
registration, under the Act of the Ordinary Shares issuable upon exercise of
the
Warrants, and it shall take such action as is necessary to qualify for sale,
in
those states in which the Warrants were initially offered by the Company, the
Ordinary Shares issuable upon exercise of the Warrants. In either case, the
Company will use its best efforts to cause the same to become effective and
to
maintain the effectiveness of such registration statement until the expiration
of the Warrants in accordance with the provisions of this Agreement. The
Warrants shall not be exercisable and the Company shall not be obligated to
issue Ordinary Shares unless, at the time a holder seeks to exercise warrants,
a
prospectus related to the Ordinary Shares issuable upon exercise of the Warrants
is current and the Ordinary Shares has been registered or qualified or deemed
to
be exempt under the laws of the state of residence of the holder of the
Warrants. In addition, the Company agrees to use its reasonable efforts to
register such securities under the blue sky laws of the states of residence
of
exercising warrant holders, if permitted by the blue sky laws of such
jurisdictions, in the event that an exemption is not available. In no event
will
the Registered Holder of a Warrant be entitled to receive a net-cash settlement
in lieu of physical settlement in Ordinary Shares, regardless of whether the
Company complies with this Section 7.4. The provisions of this Section 7.4
may
not be modified, amended or deleted without the prior written consent of
Chardan.
8. Concerning
the Warrant Agent and Other Matters.
8.1 Payment
of Taxes.
The
Company will from time to time promptly pay all taxes and charges that may
be
imposed upon the Company or the Warrant Agent in respect of the issuance or
delivery of Ordinary Shares upon the exercise of Warrants, but the Company
shall
not be obligated to pay any transfer taxes in respect of the Warrants or such
shares.
8.2
Resignation
or Consolidation of Warrant Agent.
8.2.1 Appointment
of Successor Warrant Agent.
The
Warrant Agent, or any successor to it hereafter appointed, may resign its duties
and be discharged from all further duties and liabilities hereunder after giving
sixty (60) days’ notice in writing to the Company. If the office of the Warrant
Agent becomes vacant by resignation or incapacity to act or otherwise, the
Company shall appoint in writing a successor Warrant Agent in place of the
Warrant Agent. If the Company shall fail to make such appointment within a
period of 30 days after it has been notified in writing of such resignation
or
incapacity by the Warrant Agent or by the holder of the Warrant (who shall,
with
such notice, submit his Warrant for inspection by the Company), then the holder
of any Warrant may apply to the Supreme Court of the State of New York for
the
County of New York for the appointment of a successor Warrant Agent at the
Company’s cost. Any successor Warrant Agent, whether appointed by the Company or
by such court, shall be a corporation organized and existing under the laws
of
the State of New York, in good standing and having its principal office in
the
Borough of Manhattan, City and State of New York, and authorized under such
laws
to exercise corporate trust powers and subject to supervision or examination
by
federal or state authority. After appointment, any successor Warrant Agent
shall
be vested with all the authority, powers, rights, immunities, duties, and
obligations of its predecessor Warrant Agent with like effect as if originally
named as Warrant Agent hereunder, without any further act or deed; but if for
any reason it becomes necessary or appropriate, the predecessor Warrant Agent
shall execute and deliver, at the expense of the Company, an instrument
transferring to such successor Warrant Agent all the authority, powers, and
rights of such predecessor Warrant Agent hereunder; and upon request of any
successor Warrant Agent the Company shall make, execute, acknowledge, and
deliver any and all instruments in writing for more fully and effectually
vesting in and confirming to such successor Warrant Agent all such authority,
powers, rights, immunities, duties, and obligations.
9
8.2.2 Notice
of Successor Warrant Agent.
In the
event a successor Warrant Agent shall be appointed, the Company shall give
notice thereof to the predecessor Warrant Agent and the transfer agent for
the
Ordinary Shares not later than the effective date of any such
appointment.
8.2.3 Merger
or Consolidation of Warrant Agent.
Any
corporation into which the Warrant Agent may be merged or with which it may
be
consolidated or any corporation resulting from any merger or consolidation
to
which the Warrant Agent shall be a party shall be the successor Warrant Agent
under this Agreement without any further act.
8.3 Fees
and Expenses of Warrant Agent.
8.3.1 Remuneration.
The
Company agrees to pay the Warrant Agent reasonable remuneration for its services
as such Warrant Agent hereunder and will reimburse the Warrant Agent upon demand
for all expenditures that the Warrant Agent may reasonably incur in the
execution of its duties hereunder.
8.3.2 Further
Assurances.
The
Company agrees to perform, execute, acknowledge, and deliver or cause to be
performed, executed, acknowledged, and delivered all such further and other
acts, instruments, and assurances as may reasonably be required by the Warrant
Agent for the carrying out or performing of the provisions of this
Agreement.
8.4 Liability
of Warrant Agent.
8.4.1 Reliance
on Company Statement.
Whenever in the performance of its duties under this Warrant Agreement, the
Warrant Agent shall deem it necessary or desirable that any fact or matter
be
proved or established by the Company prior to taking or suffering any action
hereunder, such fact or matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed to be conclusively proved and
established by a statement signed by the Chief Executive Officer or President
of
the Company and delivered to the Warrant Agent. The Warrant Agent may rely
upon
such statement for any action taken or suffered in good faith by it pursuant
to
the provisions of this Agreement.
8.4.2 Indemnity.
The
Warrant Agent shall be liable hereunder only for its own negligence, willful
misconduct or bad faith. The Company agrees to indemnify the Warrant Agent
and
save it harmless against any and all liabilities, including judgments, costs
and
reasonable counsel fees, for anything done or omitted by the Warrant Agent
in
the execution of this Agreement except as a result of the Warrant Agent’s
negligence, willful misconduct, or bad faith.
8.4.3 Exclusions.
The
Warrant Agent shall have no responsibility with respect to the validity of
this
Agreement or with respect to the validity or execution of any Warrant (except
its countersignature thereof); nor shall it be responsible for any breach by
the
Company of any covenant or condition contained in this Agreement or in any
Warrant; nor shall it be responsible to make any adjustments required under
the
provisions of Section 4 hereof or responsible for the manner, method, or amount
of any such adjustment or the ascertaining of the existence of facts that would
require any such adjustment; nor shall it by any act hereunder be deemed to
make
any representation or warranty as to the authorization or reservation of any
Ordinary Shares to be issued pursuant to this Agreement or any Warrant or as
to
whether any Ordinary Shares will when issued be valid and fully paid and
nonassessable.
10
8.5 Acceptance
of Agency.
The
Warrant Agent hereby accepts the agency established by this Agreement and agrees
to perform the same upon the terms and conditions herein set forth and among
other things, shall account promptly to the Company with respect to Warrants
exercised and concurrently account for, and pay to the Company, all moneys
received by the Warrant Agent for the purchase of shares of the Company’s
Ordinary Shares through the exercise of Warrants.
8.6 Waiver.
The
Warrant Agent hereby waives any and all right, title, interest or claim of
any
kind (“Claim”) in or to any distribution of the Trust Account (as defined in
that certain Investment Management Trust Agreement, dated as of the date hereof,
by and between the Company and the Warrant Agent as trustee thereunder), and
hereby agrees not to seek recourse, reimbursement, payment or satisfaction
for
any Claim against the Trust Account for any reason whatsoever.
9. Miscellaneous
Provisions.
9.1 Successors.
All the
covenants and provisions of this Agreement by or for the benefit of the Company
or the Warrant Agent shall bind and inure to the benefit of their respective
successors and assigns.
9.2 Notices.
Any
notice, statement or demand authorized by this Warrant Agreement to be given
or
made by the Warrant Agent or by the holder of any Warrant to or on the Company
shall be sufficiently given when so delivered if by hand or overnight delivery
or if sent by certified mail or private courier service within five days after
deposit of such notice, postage prepaid, addressed (until another address is
filed in writing by the Company with the Warrant Agent), as
follows:
Room
2301, World-Wide House
00
Xxx
Xxxxx Xxxx
Xxxxxxx,
Xxxx Xxxx
Attn:
Xxxx Xx Hao, Chief Executive Officer
Fax:
000-0000-0000
Any
notice, statement or demand authorized by this Agreement to be given or made
by
the holder of any Warrant or by the Company to or on the Warrant Agent shall
be
sufficiently given when so delivered if by hand or overnight delivery or if
sent
by certified mail or private courier service within five days after deposit
of
such notice, postage prepaid, addressed (until another address is filed in
writing by the Warrant Agent with the Company), as follows:
Continental
Stock Transfer & Trust Company
00
Xxxxxxx Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxxxx Xxxxxx
Fax:
0-000-000-0000
with
a
copy in each case to:
Skadden,
Arps, Slate, Xxxxxxx & Xxxx LLP
Izumi
Garden Tower 21st
Floor
0-0-0
Xxxxxxxx
Xxxxxx-xx,
Xxxxx 000-0000, Xxxxx
Attn:
Xxxxxx X. Xxxx, Esq.
Fax:
00-0-0000-0000
Chardan
Capital Markets, LLC
00
Xxxxx
Xxxxxx, Xxxxx 0000
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxxx Xxxxxxx
Fax:
0-000-000-0000
and
Loeb
& Loeb LLP
000
Xxxx
Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxxxxxx X. Xxxxxxxx, Esq.
Fax:
0-000-000-0000
11
9.3 Applicable
law.
The
validity, interpretation, and performance of this Agreement and of the Warrants
shall be governed in all respects by the laws of the State of New York, without
giving effect to conflict of laws. The Company hereby agrees that any action,
proceeding or claim against it arising out of or relating in any way to this
Agreement shall be brought and enforced in the courts of the State of New York
or the United States District Court for the Southern District of New York,
and
irrevocably submits to such jurisdiction, which jurisdiction shall be exclusive.
The Company hereby waives any objection to such exclusive jurisdiction and
that
such courts represent an inconvenient forum. Any such process or summons to
be
served upon the Company may be served by transmitting a copy thereof by
registered or certified mail, return receipt requested, postage prepaid,
addressed to it at the address set forth in Section 9.2 hereof. Such mailing
shall be deemed personal service and shall be legal and binding upon the Company
in any action, proceeding or claim.
9.4 Persons
Having Rights under this Agreement.
Nothing
in this Agreement expressed and nothing that may be implied from any of the
provisions hereof is intended, or shall be construed, to confer upon, or give
to, any person or corporation other than the parties hereto and the registered
holders of the Warrants and, for the purposes of Sections 6.1, 6.4, 7.4, 9.2
and
9.8 hereof, Chardan, any right, remedy, or claim under or by reason of this
Warrant Agreement or of any covenant, condition, stipulation, promise, or
agreement hereof. Chardan shall be deemed to be a third-party beneficiary of
this Agreement with respect to Sections 6.1, 6.4, 7.4, 9.2 and 9.8 hereof.
All
covenants, conditions, stipulations, promises, and agreements contained in
this
Warrant Agreement shall be for the sole and exclusive benefit of the parties
hereto (and Chardan with respect to the Sections 6.1, 6.4, 7.4, 9.2 and 9.8
hereof) and their successors and assigns and of the registered holders of the
Warrants.
9.5 Examination
of the Warrant Agreement.
A copy
of this Agreement shall be available at all reasonable times at the office
of
the Warrant Agent in the Borough of Manhattan, City and State of New York,
for
inspection by the registered holder of any Warrant. The Warrant Agent may
require any such holder to submit his Warrant for inspection by it.
12
9.6 Counterparts.
This
Agreement may be executed in any number of counterparts and each of such
counterparts shall for all purposes be deemed to be an original, and all such
counterparts shall together constitute but one and the same instrument.
Facsimile signatures shall constitute original signatures for all purposes
of
this Warrant Agreement.
9.7 Effect
of Headings.
The
Section headings herein are for convenience only and are not part of this
Warrant Agreement and shall not affect the interpretation thereof.
9.8 Amendments.
9.8.1 This
Agreement and any Warrant certificate may be amended by the parties hereto
by
executing a supplemental warrant agreement (a “Supplemental Agreement”), without
the consent of any of the Warrant holders, for the purpose of (i) curing any
ambiguity, or curing, correcting or supplementing any defective provision
contained herein, or making any other provisions with respect to matters or
questions arising under this agreement that is not inconsistent with the
provisions of this agreement or the Warrant certificates, (ii) evidencing the
succession of another corporation to the Company and the assumption by any
such
successor of the covenants of the Company contained in this agreement and the
Warrants, (iii) evidencing and providing for the acceptance of appointment
by a
successor Warrant Agent with respect to the Warrants, (iv) adding to the
covenants of the Company for the benefit of the Holders or surrendering any
right or power conferred upon the Company under this Agreement, or (viii)
amending this agreement and the Warrants in any manner that the Company may
deem
to be necessary or desirable and that will not adversely affect the interests
of
the Warrant holders in any material respect.
9.8.2 The
Company and the Warrant Agent may amend this Warrant Agreement and the Warrants
by executing a Supplemental Agreement with the consent of the Holders of not
fewer than a majority of the unexercised Warrants affected by such amendment,
for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Agreement or of modifying in any
manner the rights of the Holders under this Warrant Agreement; provided,
however, that, without the consent of each of the Warrant holders affected
thereby, no such amendment may be made that (i) changes the Warrants so as
to
reduce the number of Shares purchasable upon exercise of the Warrants or so
as
to increase the Exercise Price (other than as provided
by Section 4), (ii) shortens the period of time during which the Warrants may
be
exercised, (iii) otherwise adversely affects the exercise rights of the Holders
in any material respect, or (iv) reduces the number of unexercised Warrants
the
holders of which must consent for amendment of this agreement or the Warrants.
Notwithstanding anything contained herein to the contrary, Section 9 may be
amended only by the parties hereto with the consent of Chardan.
9.8.3 The
parties hereto acknowledge that Chardan shall be an intended third party
beneficiary of this Section 9.8.
9.9 Severability.
This
Warrant Agreement shall be deemed severable, and the invalidity or
unenforceability of any term or provision hereof shall not affect the validity
or enforceability of this Warrant Agreement or of any other term or provision
hereof. Furthermore, in lieu of any such invalid or unenforceable term or
provision, the parties hereto intend that there shall be added as a part of
this
Warrant Agreement a provision as similar in terms to such invalid or
unenforceable provision as may be possible and be valid and
enforceable.
13
IN
WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto
as
of the day and year first above written.
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Continental
Stock Transfer & Trust Company
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14
