THE REGISTERED HOLDER OF THIS PURCHASE OPTION, BY ITS ACCEPTANCE HEREOF, AGREES THAT IT WILL NOT SELL, TRANSFER OR ASSIGN THIS PURCHASE OPTION, EXCEPT AS HEREIN PROVIDED, AND THE REGISTERED HOLDER OF THIS PURCHASE OPTION AGREES THAT IT WILL NOT SELL,...
THE
REGISTERED HOLDER OF THIS PURCHASE OPTION, BY ITS ACCEPTANCE HEREOF, AGREES THAT
IT WILL NOT SELL, TRANSFER OR ASSIGN THIS PURCHASE OPTION, EXCEPT AS HEREIN
PROVIDED, AND THE REGISTERED HOLDER OF THIS PURCHASE OPTION AGREES THAT IT WILL
NOT SELL, TRANSFER, ASSIGN, PLEDGE OR HYPOTHECATE THIS PURCHASE OPTION FOR A
PERIOD OF SIX MONTHS FOLLOWING THE EFFECTIVE DATE (DEFINED BELOW) TO ANYONE
OTHER THAN (I) THE REPRESENTATIVE (AS DEFINED HEREIN) OR ITS AFFILIATES OR AN
UNDERWRITER OR A SELECTED DEALER IN CONNECTION WITH THE OFFERING (DEFINED
HEREIN), OR (II) A BONA FIDE OFFICER, PARTNER OR EMPLOYEE OF A REPRESENTATIVE OR
OF ANY SUCH REPRESENTATIVE, UNDERWRITER OR SELECTED DEALER.
THIS
PURCHASE OPTION IS NOT EXERCISABLE PRIOR TO THE LATER OF: (I) __________ __,
2010 AND (II) THE CONSUMMATION BY GSME ACQUISITION PARTNERS I (THE “COMPANY”) OF
A MERGER, CAPITAL STOCK EXCHANGE, ASSET ACQUISITION OR OTHER SIMILAR BUSINESS
COMBINATION (A “BUSINESS COMBINATION”) (AS DESCRIBED MORE FULLY IN THE COMPANY’S
REGISTRATION STATEMENT (AS DEFINED HEREIN)). THIS PURCHASE OPTION
SHALL BE VOID AFTER 5:00 P.M, NEW YORK CITY LOCAL TIME, ON ___________ __,
2014.
UNIT
PURCHASE OPTION
FOR
THE PURCHASE OF
360,000
UNITS
OF
1. Purchase
Option.
THIS CERTIFIES THAT, in
consideration of $100 duly paid by or on behalf of
________________________________, as registered owner of this Unit Purchase
Option (the “Holder”
and, together with all other holders of any portion of this Unit Purchase Option
(as the context herein requires, the “Holders”), to GSME ACQUISITION
PARTNERS I, a company formed under the laws of the Cayman Islands (the “Company”), Holder is entitled,
at any time or from time to time after the closing of the Offering (as defined
below) and during the period commencing (the “Commencement Date”) on the
later of: (i) the consummation of a Business Combination and (ii) __________ __,
2010, and expiring (the “Expiration Date”) at or before
5:00 p.m., New York City local time, ________ __, 2014, but not thereafter, to
subscribe for, purchase and receive, in whole or in part, up to [Three Hundred Sixty
Thousand (360,000) units] (the “Units”) of the Company, each
Unit consisting of one ordinary share of the Company, par value $0.001 per share
(the “Ordinary Shares”),
and one warrant (the “Warrant”) to purchase one
Ordinary Share expiring five years from the effective date (the “Effective Date”) of the
registration statement (the “Registration Statement”)
pursuant to which Units are offered for sale to the public (the “Offering”). Each
Warrant is on the same terms and conditions as the warrants underlying the Units
being registered for sale to the public by way of the Registration
Statement. If the Expiration Date is a day on which banking
institutions are authorized by law to close, then this Purchase Option shall
expire on the next succeeding day that is not such a day in accordance with the
terms herein. During the period ending on the Expiration Date, the Company
agrees not to take any action that would terminate the Purchase Option. This
Purchase Option is initially exercisable at $15.00 per Unit (the “Exercise
Price”). The number of Units purchasable hereunder and the
Exercise Price are subject to adjustment as provided in this Purchase
Option.
2. Exercise.
2.1 Exercise. This
Purchase Option may be exercised by the Holder in whole or in part at any time
or in part from time to time on or after the Commencement Date and before the
Expiration Date by: (x) surrendering this Purchase Option to the Company, (y)
delivering a subscription form in the attached hereto as Annex I (duly executed
by the Holder) and (z) making payment of the Exercise Price in cash, certified
or official bank check payable to the order of the Company or wire transfer of
immediately available funds (to an account designated by the Company), in any
case in an amount obtained by multiplying (a) the number of Units designated by
the Holder in the subscription form by (b) the Exercise Price then in
effect. In the event of a partial exercise or assignment hereof, the
Company shall issue and deliver to or upon the order of the Holder a new
Purchase Option of like tenor, in the name of the Holder or as the Holder (upon
payment by the Holder of applicable transfer taxes) may request, evidencing the
right to purchase the aggregate number of Units for which such Purchase Option
may still be exercised. If the subscription rights represented hereby
shall not be exercised at or before 5:00 p.m., New York City local time on the
Expiration Date, this Purchase Option automatically shall become and be void,
without further force or effect, and all rights represented hereby shall cease
and expire.
2.2 Legend. Each
certificate for the Units issued upon exercise of this Purchase Option and each
certificate representing the underlying Ordinary Shares and Warrants and the
Ordinary Shares issuable upon exercise of the underlying Warrants (the “Warrant Shares”) shall bear a
legend as follows, unless such Units, Ordinary Shares, Warrants and/or Warrant
Shares (collectively, the “Securities”) have been
registered under the Securities Act of 1933, as amended (the “Act”):
“THE
SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS AND
NEITHER THE SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD,
TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR SUCH LAWS OR AN EXEMPTION
FROM REGISTRATION UNDER THE SECURITIES ACT AND SUCH LAWS WHICH, IN THE OPINION
OF COUNSEL FOR THIS CORPORATION, IS AVAILABLE.”
2.3 Cashless
Exercise. In lieu of the payment of the Exercise Price
multiplied by the number of Units for which this Purchase Option is exercisable
(and in lieu of being entitled to receive Ordinary Shares and Warrants) in the
manner required by Section 2.1, the Holder shall have the right (but not the
obligation) to convert any exercisable but unexercised portion of this Purchase
Option into Units (the “Conversion Right”) as follows:
upon exercise of the Conversion Right, the Company shall deliver to the Holder
(without payment by the Holder of any of the Exercise Price in cash) that number
of Ordinary Shares and Warrants comprising that number of Units equal to the
quotient obtained by dividing (x) the Value (as defined below) of the portion of
the Purchase Option being converted by (y) the Current Market Value (as defined
below) of the portion of the Purchase Option being converted. The “Value” of the portion of the
Purchase Option being converted shall equal the remainder derived from
subtracting (a) (i) the Exercise Price multiplied by (ii) the number of Units
underlying the portion of this Purchase Option being converted from (b) the
Current Market Value (as defined below) of a Unit multiplied by the number of
Units underlying the portion of the Purchase Option being converted. As used
herein, the term “Current
Market Value” per Unit at any date means: (A) in the event that neither
the Units nor Warrants are still trading, the remainder derived from subtracting
(x) the exercise price of the Warrants multiplied by the number of Ordinary
Shares issuable upon exercise of the Warrants underlying one Unit from (y) (i)
the Current Market Price of the Ordinary Shares multiplied by (ii) the number of
Ordinary Shares underlying one Unit, which shall include the Ordinary Shares
underlying the Warrants included in such Unit less the Exercise Price for the
Unit plus the current Market Price of the Ordinary Shares underlying the Unit;
(B) in the event the Units, Ordinary Shares and Warrants are still trading, (i)
if the Units are listed on a national securities exchange or quoted on the
Nasdaq Global Market, Nasdaq Capital Market or OTC Bulletin Board (or
successor), the average of the last sale price of the Units in the principal
trading market for the Units as reported by the exchange, Nasdaq or OTC Bulletin
Board, as the case may be, for the ten trading days ending on the third business
day prior to exercise; or (ii) if the Units are not listed on a national
securities exchange or quoted on the Nasdaq Global Market, Nasdaq Capital Market
or OTC Bulletin Board (or successor exchange), but is traded in the residual
over-the-counter market, the average of the closing bid price for Units for the
ten trading days ending on the third business day prior to exercise for which
such quotations are
2
reported
by the Pink Sheets, LLC or similar publisher of such quotations; and (C) in the
event that the Units are not still trading but the Ordinary Shares and Warrants
underlying the Units are still trading, the Current Market Price of the Ordinary
Shares plus the product of (x) the Current Market Price of the Warrants and (y)
the number of Ordinary Shares underlying the Warrants included in one Unit. The
“Current Market Price”
shall mean (i) if the Ordinary Shares (or Warrants, as the case may be) is
listed on a national securities exchange or quoted on the Nasdaq Global Market,
Nasdaq Capital Market or OTC Bulletin Board (or successor such as the Bulletin
Board Exchange), the average of the sale price of the Ordinary Shares (or
Warrants) in the principal trading market for the Ordinary Shares as reported by
the exchange, Nasdaq or the OTC Bulletin Board, as the case may be, for the ten
trading days ending on the third business day prior to exercise; (ii) if the
Ordinary Shares (or Warrants, as the case may be) is not listed on a national
securities exchange or quoted on the Nasdaq Global Market, Nasdaq Capital Market
or the OTC Bulletin Board (or successor exchange), but is traded in the residual
over-the-counter market, the closing bid price for the Ordinary Shares (or
Warrants) on the last trading day preceding the date in question for which such
quotations are reported by the Pink Sheets, LLC or similar publisher of such
quotations; and (iii) if the fair market value of the Ordinary Shares cannot be
determined pursuant to clause (i) or (ii) above, such price as the Board of
Directors of the Company shall determine, in good faith.
2.4 Mechanics of Cashless
Exercise. The cashless exercise right set forth herein may be exercised
by the Holder on any business day on or after the Commencement Date and not
later than the Expiration Date by delivering the Purchase Option with the duly
executed exercise form attached hereto with the cashless exercise section
completed to the Company, exercising the cashless exercise right and specifying
the total number of Units the Holder will purchase pursuant to such
right.
2.5 No Cash
Settlement. Notwithstanding
anything to the contrary contained in this Purchase Option, under no
circumstances will the Company be required to net cash settle the exercise of
the Purchase Option or the Warrants underlying the Purchase Option.
2.6 Effective Registration
Statement. The Warrants underlying this Purchase Option are
exercisable only during those periods of time in which the Company maintains the
effectiveness of the Registration Statement. If the Company fails to
maintain the effectiveness of the Registration Statement, the Warrants
underlying this Purchase Option may expire worthless.
3. Transfer.
3.1 General Restrictions.
Holder agrees that, pursuant to FINRA Rule 5110(g)(1), it will not sell this
Purchase Option during the Company’s Offering, nor shall such Holder sell,
transfer, assign, pledge, hypothecate or otherwise dispose of this Purchase
Option (including the Securities hereunder) or cause this Purchase Option or the
Securities hereunder to be the subject of any hedging, short sale, derivative,
put or call transaction that would result in the effective economic disposition
of this Purchase Option or the Securities hereunder, except as provided for in
FINRA Rule 5110(g)(2).
3.2 Restrictions Imposed by the
Act. The Securities evidenced by this Purchase Option shall not be
transferred unless and until (i) the Company has received the opinion of counsel
for the Holder that the Securities may be transferred pursuant to an exemption
from registration under the Act and applicable state securities laws, the
availability of which is established to the reasonable satisfaction of the
Company (the Company hereby agreeing that the opinion of Ellenoff, Xxxxxxxx
& Schole LLP shall be deemed satisfactory evidence of the availability of an
exemption), or (ii) a registration statement or a post-effective amendment to
the Registration Statement relating to such Securities has been filed by the
Company and declared effective by the Securities and Exchange Commission (the
“SEC”) and compliance
with applicable state securities law has been established.
4. New Purchase Options to be
Issued.
4.1 Partial Exercise or
Transfer. Subject to the restrictions in Section 3 hereof, this Purchase
Option may be exercised or assigned in whole or in part. In order to make any
permitted assignment or transfer, the Holder must deliver to the Company the
assignment form attached hereto as Xxxxx XX duly executed and completed,
together with the Purchase Option and payment of all transfer taxes, if any,
payable in connection therewith. The Company shall within five (5) business days
transfer this Purchase Option on the books of the Company and shall execute and
deliver a new Purchase Option or Purchase Options of like tenor to the
appropriate assignee(s) expressly evidencing the right to purchase the aggregate
number of Units purchasable hereunder or such portion of such number as shall be
contemplated by any such assignment or transfer.
3
4.2 Lost Certificate.
Upon receipt by the Company of evidence satisfactory to it of the loss, theft,
destruction or mutilation of this Purchase Option and of reasonably satisfactory
indemnification or the posting of a bond, the Company shall execute and deliver
a new Purchase Option of like tenor and date. Any such new Purchase Option
executed and delivered as a result of such loss, theft, mutilation or
destruction shall constitute a substitute contractual obligation on the part of
the Company.
5. Registration
Rights.
5.1 Demand
Registration.
5.1.1 Grant of Right. The
Company, upon written demand (an “Demand Notice”) of the
Holder(s) of at least 51% (the “Majority Holders”) of the
Purchase Options and/or the underlying Units and/or the underlying Securities,
agrees to register all or any portion of the Purchase Option and the underlying
Securities (collectively, the “Registrable Securities”) as
requested by the Majority Holders. The Company will file a registration
statement or a post-effective amendment to the Registration Statement covering
the Registrable Securities within sixty (60) days after receipt of the Initial
Demand Notice and use its commercially reasonable efforts to have such
registration statement or post-effective amendment declared effective as soon as
possible thereafter, subject to compliance with review by the SEC. The demand
for registration may be made at any time beginning on the Commencement Date. The
Company covenants and agrees to give written notice of its receipt of any Demand
Notice by any Holder(s) to all other registered Holders of the Purchase Options
and/or the Registrable Securities within ten (10) days from the date of the
receipt of any such Demand Notice.
5.1.2 Terms. The
Company shall bear all fees and expenses attendant to registering the
Registrable Securities, including the expenses of one legal counsel selected by
the Majority Holders to represent them in connection with the registration of
the Registrable Securities, but the Holders shall pay any and all underwriting
commissions. The Company agrees to use its reasonable best efforts to
qualify or register the Registrable Securities in such States as are reasonably
requested by the Majority Holder(s); provided, however, that in no
event shall the Company be required to register the Registrable Securities in a
State in which such registration would cause (i) the Company to be obligated to
qualify to do business in such State, or would subject the Company to taxation
as a foreign corporation doing business in such jurisdiction or (ii) the
principal stockholders of the Company to be obligated to escrow their shares of
capital stock of the Company. The Company shall cause any registration statement
or post-effective amendment filed pursuant to the demand rights granted under
Section 5.1.1 to remain effective for a period of the later of (1) the exercise
period of the Warrants or two (2) years from the effective date of such
registration statement or post-effective amendment.
5.2 “Piggy-Back”
Registration.
5.2.1 Grant of Right. If at
any time during a period of seven (7) years commencing on the Effective Date
when there is not an effective registration statement covering all of the
Registrable Securities, the Company shall determine to prepare and file with the
SEC a registration statement relating to an offering under the Act of any of its
securities, other than pursuant to SEC Form S-4 or S-8 or any equivalent form,
the Company, upon the request of any Holder, as described below, shall cause the
registration under the Act of the Registrable Securities as part of any such
registration statement filed by the Company; provided, however, that if,
in the written opinion of the Company’s managing underwriter or underwriters, if
any, for such offering, the inclusion of the Registrable Securities, when added
to the securities being registered by the Company or the selling stockholder(s),
will exceed the maximum amount of the Company’s securities (the “Maximum Number of Shares”)
which can be marketed (i) at a price reasonably related to their then current
market value, and (ii) without materially and adversely affecting the entire
offering, then the Company shall include in any such registration:
(i) If
the registration is undertaken for the Company’s account: (A) first, the
Ordinary Shares or other securities that the Company desires to sell that can be
sold without exceeding the Maximum Number of Shares; (B) second, to the extent
that the Maximum Number of Shares has not been reached under the foregoing
clause (A), the Ordinary Shares, if any, including the Registrable Securities,
as to which registration has been requested pursuant to written contractual
piggy-back registration rights of security holders that are in effect on the
date hereof (pro rata in accordance with the number of Ordinary Shares which
each such person has actually requested to be included in such registration,
regardless of the number of Ordinary Shares with respect to which such persons
have the right to request such inclusion) that can be sold without exceeding the
Maximum Number of Shares; and
4
(ii) If
the registration is a “demand” registration undertaken at the demand of persons
other than the holders of Registrable Securities pursuant to written contractual
arrangements with such persons, (A) first, the Ordinary Shares for the account
of the demanding persons that can be sold without exceeding the Maximum Number
of Shares; (B) second, to the extent that the Maximum Number of Shares has not
been reached under the foregoing clause (A), the Ordinary Shares or other
securities that the Company desires to sell that can be sold without exceeding
the Maximum Number of Shares; and (C) third, to the extent that the Maximum
Number of Shares has not been reached under the foregoing clauses (A) and (B),
the Registrable Securities as to which registration has been requested under
this Section 5.2 (pro rata in accordance with the number of shares of
Registrable Securities held by each such holder); and (D) fourth, to the extent
that the Maximum Number of Shares has not been reached under the foregoing
clauses (A), (B) and (C), the Ordinary Shares, if any, as to which registration
has been requested pursuant to written contractual piggy-back registration
rights which other shareholders desire to sell that can be sold without
exceeding the Maximum Number of Shares.
5.2.2 Terms. The Company
shall bear all reasonable fees and expenses attendant to registering the
Registrable Securities, including the reasonable expenses of one legal counsel
selected by the Majority Holders to represent them in connection with the
registration of the Registrable Securities (such fees and expenses of legal
counsel not to exceed $25,000) but the Holders shall pay any and all
underwriting commissions related to the Registrable Securities. In
the event of such a proposed registration, the Company shall furnish the then
Holders of outstanding Registrable Securities with not less than fifteen (15)
days’ written notice prior to the proposed date of filing of such registration
statement. Such notice to the Holders shall continue to be given for each
applicable registration statement filed (during the period in which the Purchase
Option is exercisable) by the Company until such time as all of the Registrable
Securities have been registered and sold. The holders of the Registrable
Securities shall exercise the “piggy-back” rights provided for herein by giving
written notice, within ten days of the receipt of the Company’s notice of its
intention to file a registration statement. The Company shall cause any
registration statement filed pursuant to the above “piggyback” rights to remain
effective for at least nine months from the date that the Holders of the
Registrable Securities are first given the opportunity to sell all of such
securities. The Company agrees, at its sole expense, to use its
reasonable best efforts to qualify or register the Registrable Securities in
such States as are reasonably requested by the Majority Holder(s); provided,
however, that in no event shall the Company be required to register the
Registrable Securities in a State in which such registration would cause (i) the
Company to be obligated to qualify to do business in such State, or would
subject the Company to taxation as a foreign corporation doing business in such
jurisdiction or (ii) the principal stockholders of the Company to be obligated
to escrow their shares of capital stock of the Company.
5.3 General
Terms.
5.3.1 Indemnification. The
Company shall, notwithstanding any termination of this Purchase Option,
indemnify and hold harmless each Holder, the officers, directors, agents,
brokers, investment advisors and employees of each of them and each person, if
any, who controls such Holders within the meaning of Section 15 of the Act or
Section 20(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the
officers, directors, agents and employees of such controlling person, to the
fullest extent permitted by applicable law, from and against all loss, claim,
damage, expense or liability (including all reasonable attorneys’ fees and other
expenses reasonably incurred in investigating, preparing or defending against
litigation, commenced or threatened, or any claim whatsoever whether arising out
of any action between the underwriter and the Company or between the underwriter
and any third party or otherwise) to which any of them may become subject under
the Act, the Exchange Act or otherwise, arising out of or relating to such
registration statement filed pursuant to this Section 5 and any prospectus
contained in the registration statement or in any amendment or supplement
thereto, except only to the same extent and with the same effect as the
provisions pursuant to which the Company has agreed to indemnify the
underwriters contained in Section 5.1 of the Underwriting Agreement (the “Underwriting Agreement”)
between the Company and Xxxxx & Company Securities, LLC, (the “Representative”) and the other
underwriters named therein, dated the Effective Date. Each Holder of
the Registrable Securities to be sold pursuant to such registration statement,
and their successors and assigns, shall severally, and not jointly, indemnify
the Company, its officers and directors and each person, if any, who controls
the Company within the meaning of Section 15 of the Act or Section 20(a) of the
Exchange Act, against all loss, claim, damage, expense or liability (including
all reasonable attorneys’ fees and other expenses reasonably incurred in
investigating, preparing or defending against any claim whatsoever) to which
they may become subject under the Act, the Exchange Act or otherwise, arising
from information furnished by or on behalf of such Holders, or their successors
or assigns, in writing, for specific inclusion in such registration statement to
the same extent and with the same effect as the provisions contained in Section
5.2 of the Underwriting Agreement pursuant to which the underwriters have agreed
to indemnify the Company.
5
5.3.2 Exercise of Purchase
Options. Nothing contained in this Purchase Option shall be construed as
requiring any Holder to exercise their Purchase Options or Warrants underlying
such Purchase Options prior to or after the filing of any registration statement
or the effectiveness thereof.
5.3.3 Documents Delivered to
Holders. The Company shall furnish to Xxxxx & Company Securities,
LLC, as representative of the Holders participating in any of the foregoing
offerings, a signed counterpart, addressed to the participating Holders, of (i)
an opinion of counsel to the Company, dated the effective date of such
registration statement (and, if such registration includes an underwritten
public offering, an opinion dated the date of the closing under any underwriting
agreement related thereto), and (ii) a “cold comfort” letter dated the effective
date of such registration statement (and, if such registration includes an
underwritten public offering, a letter dated the date of the closing under the
underwriting agreement) signed by the independent public accountants who have
issued a report on the Company’s financial statements included in such
registration statement, in each case covering substantially the same matters
with respect to such registration statement (and the prospectus included
therein) and, in the case of such accountants’ letter, with respect to events
subsequent to the date of such financial statements, as are customarily covered
in opinions of issuer’s counsel and in accountants’ letters delivered to
underwriters in underwritten public offerings of securities. The Company shall
also deliver promptly to Xxxxx & Company Securities, LLC, as representative
of the Holders participating in the offering, the correspondence and memoranda
described below and copies of all correspondence between the Commission and the
Company, its counsel or auditors and all memoranda relating to discussions with
the Commission or its staff with respect to the registration statement and
permit Xxxxx & Company Securities, LLC, as representative of the Holders, to
do such investigation, upon reasonable advance notice, with respect to
information contained in or omitted from the registration statement as it deems
reasonably necessary to comply with applicable securities laws or rules of the
Financial Industry Regulatory Authority, Inc. (“FINRA”). Such
investigation shall include access to books, records and properties and
opportunities to discuss the business of the Company with its officers and
independent auditors, all to such reasonable extent and at such reasonable times
and as often as Xxxxx & Company Securities, LLC, as representative of the
Holders, shall reasonably request. The Company shall not be required
to disclose any confidential information or other records to Xxxxx & Company
Securities, LLC, as representative of the Holders, or to any other person, until
and unless such persons shall have entered into reasonable confidentiality
agreements (in form and substance reasonably satisfactory to the Company), with
the Company with respect thereto.
5.3.4 Documents to be Delivered by
Holders(s). Each Holder participating in any of the foregoing
offerings shall furnish to the Company a completed and executed questionnaire
provided by the Company requesting information customarily sought of selling
securityholders.
5.3.5 Underwriting
Agreement. The Company shall enter into an underwriting agreement with
the managing underwriter(s), if any, selected by any Holders, whose Registrable
Securities are being registered pursuant to this Section 5, which managing
underwriter shall be reasonably acceptable to the Company. Such agreement shall
be reasonably satisfactory in form and substance to the Company and its legal
counsel, each Holder and such managing underwriters, and shall contain such
representations, warranties and covenants by the Company and such other terms as
are customarily contained in agreements of that type used by the managing
underwriter. The Holders shall be parties to any underwriting agreement relating
to an underwritten sale of their Registrable Securities and may, at their
option, require that any or all the representations, warranties and covenants of
the Company to or for the benefit of such underwriters shall also be made to and
for the benefit of such Holders. Such Holders shall not be required to make any
representations or warranties to or agreements with the Company or the
underwriters except as they may relate to such Holders and their intended
methods of distribution. Such Holders, however, shall agree to such covenants
and indemnification and contribution obligations for selling stockholders as are
customarily contained in agreements of that type used by the managing
underwriter. Further, such Holders shall execute appropriate custody agreements
and otherwise cooperate fully in the preparation of the registration statement
and other documents relating to any offering in which they include securities
pursuant to this Section 5. Each Holder shall also furnish to the Company such
information regarding itself, the Registrable Securities held by it, and the
intended method of disposition of such securities as shall be reasonably
required to effect the registration of the Registrable
Securities.
6
5.3.6 Rule 144
Sale. Notwithstanding anything contained in this Section 5 to
the contrary, the Company shall have no obligation pursuant to Sections 5.1 or
5.2 for the registration of Registrable Securities held by any Holders (i) where
such Holders would then be entitled to sell under Rule 144 within any three
month period (or such other period prescribed under Rule 144 as may be provided
by amendment thereof) all of the Registrable Securities held by such Holders,
and (ii) where the number of Registrable Securities held by such Holders is
within the volume limitations under paragraph (e) of Rule 144 (calculated as if
such Holders were an affiliate within the meaning of Rule
144).
5.3.7 Supplemental
Prospectus. Each Holder agrees, that upon receipt of any notice from the
Company of the happening of any event as a result of which the prospectus
included in the Registration Statement, as then in effect, includes an untrue
statement of a material fact or omits to state a material fact required to be
stated therein or necessary to make the statements therein not misleading in
light of the circumstances then existing, such Holders will immediately
discontinue disposition of Registrable Securities pursuant to the Registration
Statement covering such Registrable Securities until such Holders’s receipt of
the copies of a supplemental or amended prospectus, and, if so desired by the
Company, such Holders shall deliver to the Company (at the expense of the
Company) or destroy (and deliver to the Company a certificate of such
destruction) all copies, other than permanent file copies then in such Holders’s
possession, of the prospectus covering such Registrable Securities current at
the time of receipt of such notice.
6. Adjustments.
6.1 Adjustments to Exercise
Price and Number of Securities. The Exercise Price and the number of
Units underlying the Purchase Option shall be subject to adjustment from time to
time as hereinafter set forth:
6.1.1 Stock Dividends -
Split-Ups. If after the date hereof, 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 thereof, the number of Ordinary Shares underlying each of the Units
purchasable hereunder shall be increased in proportion to such increase in
outstanding shares. In such case, the number of Ordinary Shares, and the
exercise price applicable thereto, underlying the Warrants underlying each of
the Units purchasable hereunder shall be adjusted in accordance with the terms
of the Warrants. For example, if the Company declares a two-for-one stock
dividend and at the time of such dividend this Purchase Option is for the
purchase of one Unit at $15.00 whole Unit (each Warrant underlying the Units is
exercisable for $11.50 per share), upon effectiveness of the dividend, this
Purchase Option will be adjusted to allow for the purchase of one Unit at $15.00
per Unit, each Unit entitling the holder to receive two Ordinary Shares and two
Warrants (each Warrant exercisable for $6.25 per share).
6.1.2 Aggregation of
Shares. If after the date hereof, the number of outstanding Ordinary
Shares is decreased by a consolidation, combination or reclassification of
Ordinary Shares or other similar event, then, on the effective date thereof, the
number of Ordinary Shares underlying each of the Units purchasable hereunder
shall be decreased in proportion to such decrease in outstanding shares. In such
case, the number of Ordinary Shares, and the exercise price applicable thereto,
underlying the Warrants underlying each of the Units purchasable hereunder shall
be adjusted in accordance with the terms of the Warrants.
6.1.3 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 6.1.1 or 6.1.2 hereof or that solely affects the par value of such
Ordinary Shares, or in the case of any merger or consolidation of the Company
with or into another corporation (other than a consolidation or merger in which
the Company is the continuing corporation and that does not result in any
reclassification or reorganization of the outstanding Ordinary Shares), or in
the case of any sale or conveyance to another corporation or entity of the
property of the Company as an entirety or substantially as an entirety in
connection with which the Company is dissolved, the Holders of this Purchase
Option shall have the right thereafter (until the expiration of the right of
exercise of this Purchase Option) to receive upon the exercise hereof, for the
same aggregate Exercise Price payable hereunder immediately prior to such event,
the kind and amount of shares of stock or other securities or property
(including cash) receivable upon such reclassification, reorganization, merger
or consolidation, or upon a dissolution following any such sale or transfer, by
a Holders of the number of Ordinary Shares of the Company obtainable upon
exercise of this Purchase Option and the underlying Warrants immediately prior
to such event; and if any reclassification also results in a change in Ordinary
Shares covered by Section 6.1.1 or 6.1.2, then such adjustment shall be made
pursuant to Sections 6.1.1, 6.1.2 and this Section 6.1.3. The provisions of this
Section 6.1.3 shall similarly apply to successive reclassifications,
reorganizations, mergers or consolidations, sales or other transfers.
7
6.1.4 Changes in Form of Purchase
Option. This form of Purchase Option need not be changed because of any
change pursuant to this Section, and the Purchase Options issued after such
change may state the same Exercise Price and the same number of Units as are
stated in the Purchase Options initially issued pursuant to this Agreement. The
acceptance by any Holders of the issuance of new Purchase Options reflecting a
required or permissive change shall not be deemed to waive any rights to an
adjustment occurring after the Commencement Date or the computation
thereof.
6.2 Substitute Purchase
Option. In case of any consolidation of the Company with, or merger of
the Company with, or merger of the Company into, another corporation (other than
a consolidation or merger which does not result in any reclassification or
change of the outstanding Ordinary Shares), the corporation formed by such
consolidation or merger shall execute and deliver to the Holders a supplemental
Purchase Option providing that the holder of each Purchase Option then
outstanding or to be outstanding shall have the right thereafter (until the
stated expiration of such Purchase Option) to receive, upon exercise of such
Purchase Option, the kind and amount of shares of stock and other securities and
property receivable upon such consolidation or merger, by a holder of the number
of Ordinary Shares of the Company for which such Purchase Option might have been
exercised immediately prior to such consolidation, merger, sale or transfer.
Such supplemental Purchase Option shall provide for adjustments which shall be
identical to the adjustments provided in Section 6. The above provision of this
Section shall similarly apply to successive consolidations or
mergers.
6.3 Elimination of Fractional
Interests. The Company shall not be required to issue certificates
representing fractions of Ordinary Shares or Warrants upon the exercise of the
Purchase Option, nor shall it be required to issue scrip or pay cash in lieu of
any fractional interests, it being the intent of the parties that all fractional
interests shall be eliminated by rounding any fraction up or down to the nearest
whole number of Warrants, Ordinary Shares or other securities, properties or
rights.
7. Reservation and
Listing. The Company shall at all times reserve and keep available out of
its authorized Ordinary Shares, solely for the purpose of issuance upon exercise
of the Purchase Options or the Warrants underlying the Purchase Option, such
number of Ordinary Shares or other securities, properties or rights as shall be
issuable upon the exercise thereof. The Company covenants and agrees that, upon
exercise of the Purchase Options and payment of the Exercise Price therefor, all
Ordinary Shares and other securities issuable upon such exercise shall be duly
and validly issued, fully paid and non-assessable and not subject to preemptive
rights of any stockholder. The Company further covenants and agrees that upon
exercise of the Warrants underlying the Purchase Options and payment of the
respective Warrant exercise price therefor, all Ordinary Shares and other
securities issuable upon such exercise shall be duly and validly issued, fully
paid and non-assessable and not subject to preemptive rights of any stockholder.
As long as the Purchase Options shall be outstanding, the Company shall use its
best efforts to cause all (i) Units and Ordinary Shares issuable upon exercise
of the Purchase Options, (ii) Warrants issuable upon exercise of the Purchase
Options and (iii) Ordinary Shares issuable upon exercise of the Warrants
included in the Units issuable upon exercise of the Purchase Option to be listed
(subject to official notice of issuance) on all securities exchanges (or, if
applicable on the Nasdaq Global Market, Nasdaq Capital Market, OTC Bulletin
Board or any successor trading market) on which the Units, the Ordinary Shares
or the Warrants may then be listed and/or quoted.
8
8. Certain Notice
Requirements.
8.1 Holder’s Right to Receive
Notice. Nothing herein shall be construed as conferring upon the Holders
the right to vote or consent as a stockholder for the election of directors or
any other matter, or as having any rights whatsoever as a stockholder of the
Company. If, however, at any time prior to the expiration of the Purchase
Options and their exercise, any of the events described in Section 8.2 shall
occur, then, in one or more of said events, the Company shall give written
notice of such event at least fifteen (15) days prior to the date fixed as a
record date or the date of closing the transfer books for the determination of
the stockholders entitled to such dividend, distribution, conversion or exchange
of securities or subscription rights, or entitled to vote on such proposed
dissolution, liquidation, winding up or sale. Such notice shall specify such
record date or the date of the closing of the transfer books, as the case may
be. Notwithstanding the foregoing, the Company shall deliver to each Holder a
copy of each notice given to the other stockholders of the Company at the same
time and in the same manner that such notice is given to the
stockholders.
8.2 Events Requiring
Notice. The Company shall be required to give the notice described in
this Section 8 upon one or more of the following events: (i) if the Company
shall take a record of the holders of its Ordinary Shares for the purpose of
entitling them to receive a dividend or distribution, or (ii) the Company shall
offer to all the holders of its Ordinary Shares any additional shares of capital
stock of the Company or securities convertible into, exercisable for or
exchangeable for shares of capital stock of the Company, or any option, right or
warrant to subscribe therefor, or (iii) a dissolution, liquidation or winding up
of the Company (other than in connection with a consolidation or merger) or a
sale of all or substantially all of its property, assets and business or a
merger of the Company wherein the separate existence of the Company shall cease
shall be proposed.
8.3 Notice of Change in Exercise
Price. The Company shall, promptly after an event requiring a change in
the Exercise Price pursuant to Section 6 hereof, send notice to the Holders of
such event and change (a “Price
Notice”). The Price Notice shall describe the event causing the change
and the method of calculating same and shall be certified as being true and
accurate by the Company’s President and Chief Financial Officer.
8.4 Transmittal of
Notices. All notices, requests, consents and other communications under
this Purchase Option shall be in writing and shall be deemed to have been duly
made when hand delivered, mailed by express mail or private courier service, or
sent by facsimile transmission, with confirmation of receipt: (i) If to the
registered Holders of the Purchase Option, to the address and/or fax number of
such Holders as shown on the books of the Company, or (ii) if to the Company, to
the following address or fax number or to such other address or and fax number
as the Company may designate by notice to the Holders:
000 Xxxx
Xxxxxxx Xxxx
Shanghai,
PRC 200041
Fax:
[ ]
9.1 Amendments. The
Company and Xxxxx & Company Securities, LLC may from time to time supplement
or amend this Purchase Option without the approval of any of the Holders in
order to cure any ambiguity, to correct or supplement any provision contained
herein that may be defective or inconsistent with any other provisions herein,
or to make any other provisions in regard to matters or questions arising
hereunder that the Company and the Representative may deem necessary or
desirable and that the Company and the Representative deem shall not adversely
affect the interest of the Holders. All other modifications or
amendments shall require the written consent of and be signed by the party
against whom enforcement of the modification or amendment is
sought.
9.2 Headings. The
headings contained herein are for the sole purpose of convenience of reference,
and shall not in any way limit or affect the meaning or interpretation of any of
the terms or provisions of this Purchase Option.
9
9.3. Entire Agreement.
This Purchase Option (together with the other agreements and documents being
delivered pursuant to or in connection with this Purchase Option) constitutes
the entire agreement of the parties hereto with respect to the subject matter
hereof, and supersedes all prior agreements and understandings of the parties,
oral and written, with respect to the subject matter hereof.
9.4 Binding Effect. This
Purchase Option shall inure solely to the benefit of and shall be binding upon,
the Holders and the Company and their permitted assignees, respective
successors, legal representative and assigns, and no other person shall have or
be construed to have any legal or equitable right, remedy or claim under or in
respect of or by virtue of this Purchase Option or any provisions herein
contained.
9.5 Governing Law; Submission to
Jurisdiction. This Purchase Option shall be governed by and construed and
enforced in accordance with the laws of the State of New York, without giving
effect to conflict of laws. Each of the Company and the Holder agree
that any action, proceeding or claim against it arising out of, or relating in
any way to this Purchase Option shall be brought and enforced in the courts of
the State of New York located in New York County or of the United States of
America for the Southern District of New York, and irrevocably submits to such
jurisdiction, which jurisdiction shall be exclusive. Each of the
Company and the Holder hereby waives any objection to such exclusive
jurisdiction and that such courts represent an inconvenient forum. Any 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 8 hereof. Such
mailing shall be deemed personal service and shall be legal and binding upon the
Company in any action, proceeding or claim. The Company and the Holders agree
that the prevailing party(ies) in any such action shall be entitled to recover
from the other party(ies) all of its reasonable attorneys’ fees and expenses
relating to such action or proceeding and/or incurred in connection with the
preparation therefor.
9.6 Waiver, Etc. The
failure of the Company or the Holders to at any time enforce any of the
provisions of this Purchase Option shall not be deemed or construed to be a
waiver of any such provision, nor to in any way affect the validity of this
Purchase Option or any provision hereof or the right of the Company or any
Holders to thereafter enforce each and every provision of this Purchase Option.
No waiver of any breach, non-compliance or non-fulfillment of any of the
provisions of this Purchase Option shall be effective unless set forth in a
written instrument executed by the party or parties against whom or which
enforcement of such waiver is sought; and no waiver of any such breach,
non-compliance or non-fulfillment shall be construed or deemed to be a waiver of
any other or subsequent breach, non-compliance or non-fulfillment.
9.7 Execution. It is
agreed that deliver of the Company’s signature hereon by facsimile or other
electronic method of delivery shall constitute a valid signature and
delivery.
9.8 Exchange Agreement.
As a condition of the Holder’s receipt and acceptance of this Purchase Option,
Xxxxxx agrees that, at any time prior to the complete exercise of this Purchase
Option by Holders, if the Company and Xxxxx & Company Securities, LLC, as
representative of the Holder, enter into an agreement (an “Exchange Agreement”) pursuant
to which they agree that all outstanding Purchase Options will be exchanged for
securities or cash or a combination of both, then Holder shall agree to such
exchange and become a party to the Exchange Agreement.
9.9 [Reserved]
10
IN
WITNESS WHEREOF, the Company has caused this Purchase Option to be signed by its
duly authorized officer as of the _____ day of _____, 2009.
By:
_________________________________
Name:
Title:
11
Annex
I
Form to
be used to exercise Purchase Option
_________________________
_________________________
Date:_________________,
200__
The
undersigned hereby elects irrevocably to exercise all or a portion of the within
Purchase Option and to purchase ____ Units of GSME ACQUISITION PARTNERS I and
hereby makes payment of $____________ (at the rate of $_________ per Unit) in
payment of the Exercise Price pursuant thereto. Please issue the Ordinary Shares
and Warrants as to which this Purchase Option is exercised in accordance with
the instructions given below.
or
The
undersigned hereby elects irrevocably to convert its right to purchase _________
Units purchasable under the within Purchase Option by surrender of the
unexercised portion of the attached Purchase Option (with a “Value” based of
$_______ based on a “Market Price” of $_______). Please issue the securities
comprising the Units as to which this Purchase Option is exercised in accordance
with the instructions given below.
________________________
Signature
________________________
Signature
Guaranteed
INSTRUCTIONS
FOR REGISTRATION OF SECURITIES
Name_____________________________________________________________
(Print in
Block Letters)
Address__________________________________________________________
NOTICE:
THE SIGNATURE TO THIS FORM MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE
FACE OF THE WITHIN PURCHASE OPTION IN EVERY PARTICULAR WITHOUT ALTERATION OR
ENLARGEMENT OR ANY CHANGE WHATSOEVER, AND MUST BE GUARANTEED BY A BANK, OTHER
THAN A SAVINGS BANK, OR BY A TRUST COMPANY OR BY A FIRM HAVING MEMBERSHIP ON A
REGISTERED NATIONAL SECURITIES EXCHANGE.
12
Xxxxx
XX
Form to
be used to assign Purchase Option
ASSIGNMENT
(To be
executed by the registered Holders to effect a transfer of the within Purchase
Option):
FOR VALUE
RECEIVED,___________________________________________ does hereby sell, assign
and transfer unto______________________________________ the right to purchase
__________ Units of GSME ACQUISITION PARTNERS I (the “Company”) evidenced by the
within Purchase Option and does hereby authorize the Company to transfer such
right on the books of the Company.
Dated:___________________,
200_
______________________
Signature
______________________
Signature
Guaranteed
NOTICE:
THE SIGNATURE TO THIS FORM MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE
FACE OF THE WITHIN PURCHASE OPTION IN EVERY PARTICULAR WITHOUT ALTERATION OR
ENLARGEMENT OR ANY CHANGE WHATSOEVER, AND MUST BE GUARANTEED BY A BANK, OTHER
THAN A SAVINGS BANK, OR BY A TRUST COMPANY OR BY A FIRM HAVING MEMBERSHIP ON A
REGISTERED NATIONAL SECURITIES EXCHANGE.
13
