AMENDED AND RESTATED WARRANT AGREEMENT
AMENDED
AND RESTATED WARRANT AGREEMENT
Agreement made as of September __, 2009
between CNC Development Ltd., a British Virgin Islands corporation, with offices
at 000 Xxxxxx Xx, Xxxxx 000, Xxxxxxxx 000000 P.R.C (“Company”), and Continental
Stock Transfer & Trust Company, a New York corporation, with offices at 00
Xxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 (“Warrant Agent”).
WHEREAS, InterAmerican Acquisition
Group Inc. (“IAG”) consummated an initial public offering (“Public Offering”) of
units in September 2007 and, in connection therewith, issued and delivered
5,750,000 warrants to the public investors (the “Public Warrants”), each of such
Public Warrants evidencing the right of the holder thereof to purchase one share
of IAG’s common stock, par value $.0001 per share, for $5.00 per
share;
WHEREAS, IAG also issued an aggregate
of 55,850 warrants (the “Private Warrants” and, together with the Public
Warrants, the “Warrants”) to purchase shares of IAG’s common stock, par value
$.0001 per share, for $0.01 per share, in various private placements following
the Public Offering;
WHEREAS, on September 4, 2007, IAG and
the Warrant Agent entered into a Warrant Agreement (the “Original Warrant
Agreement”);
WHEREAS, on September 9, 2009, pursuant
to the Amended and Restated Stock Purchase Agreement (the ”SPA”), dated as of
May 15, 2008, as amended on November 28, 2008 and July 17, 2009 by and among
IAG, Sing Kung Limited (“Sing Kung”), a British Virgin Islands company, Xxx
Xxxx, and certain other stockholders of Sing Kung, IAG purchased substantially
all of the outstanding shares of common stock of Sing Kung;
WHEREAS, in connection with the
transactions contemplated by the SPA and as part of the acquisition of Sing
Kung, on September 9, 2009, IAG merged with and into the Company for the
purposes of reincorporation and redomestication to the British Virgin
Islands;
WHEREAS, in connection with the
transactions contemplated by the SPA, it is contemplated that the terms of the
Warrants to purchase shares of IAG common stock be amended to provide that upon
exercise, holders will receive 0.1850734 common shares of the Company, par value
US$.0001 per share (the “Common Shares”) and 0.8857955 Class A Preferred Shares
of the Company, par value US$.0001 per share (the “Preferred Shares”), in lieu
of one share of IAG common stock;
WHEREAS, the Company has filed with the
Securities and Exchange Commission a Registration Statement on Form S-4, File
No. 333-152977 and File No. 000-000000-00 (“Registration Statement”), for
the registration, under the Securities Act of 1933, as amended (“Act”) of, among
other securities, the Warrants and the Common Shares and the Preferred Shares
issuable upon exercise of the Warrants, which Registration Statement was
declared effective by the Securities and Exchange Commission on August 7,
2009;
WHEREAS, the Company and the Warrant
Agent desire to amend and restate the Original Warrant Agreement to reflect the
revised terms of the Warrants as required by the SPA;
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 Warrants;
and
WHEREAS, all acts and things have been
done and performed which are necessary to make the Warrants, when executed on
behalf of the Company and countersigned by or on behalf of the Warrant Agent, as
provided herein, the valid, binding and legal obligations of the Company, and to
authorize the execution and delivery of this Agreement.
NOW, THEREFORE, in consideration of the
mutual agreements herein contained, the parties hereto agree as
follows:
1. Appointment of Warrant
Agent. The Company hereby appoints the Warrant Agent to act as
agent for the Company for the Warrants, 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 Chairman of the Board or President and Treasurer, Secretary or Assistant
Secretary 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.
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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.
3. Terms and Exercise of
Warrants.
3.1. Warrant
Price. Each Public 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 Common Shares and Preferred Shares stated therein, at the
price of $5.00, subject to the adjustments provided in Section 4 hereof and in
the last sentence of this Section 3.1. Each Private 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 Common Shares and
Preferred Shares stated therein, at the price of $0.01, 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 at which Common Shares and Preferred 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 (as defined
below).
3.2. Duration of
Warrants. A Warrant may be exercised only during the period
(“Exercise Period”) commencing on the date of this Warrant Agreement, and
terminating at 5:00 p.m., New York City time on the earlier to occur of (i)(a)
with respect to the Public Warrants, September 4, 2011 and (b) with respect to
the Private Warrants, September 4, 2009, 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. Notwithstanding the foregoing, a Warrant may expire unexercised
regardless of whether a registration statement covering the sale of the Common
Shares and Preferred Shares underlying the Warrants is effective.
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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 the Common Shares
and the Preferred Shares as to which the Warrant is exercised and any and all
applicable taxes due in connection with the exercise of the Warrant, the
exchange of the Warrant for the Common Shares and the Preferred Shares, and the
issuance of the Common Shares and the Preferred Shares.
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 Common Shares and Preferred 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. Notwithstanding the foregoing, the Company shall not be
obligated to deliver any securities pursuant to the exercise of a Warrant unless
(i) a registration statement under the Act with respect to the Common Shares and
the Preferred Shares issuable upon such exercise is effective, or (ii) in the
opinion of counsel to the Company, the exercise of the Warrants is exempt from
the registration requirements of the Act and such securities are qualified for
sale or exempt from qualification under applicable securities laws of the states
or other jurisdictions in which the registered holders
reside. Warrants may not be exercised by, or securities issued to,
any registered holder in any state in which such exercise or issuance would be
unlawful. In no event will the registered holder of a Warrant be entitled to
receive a net-cash settlement, Common Shares, Preferred Shares or other
consideration in lieu of physical settlement in Common Shares or Preferred
Shares, regardless of whether the Common Shares or Preferred Shares underlying
the Warrants is registered pursuant to an effective registration
statement.
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3.3.3. Valid
Issuance. All Common Shares and Preferred 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
Common Shares or Preferred 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.
3.3.5. Warrant Solicitation and
Warrant Solicitation Fee.
(a) The
Company has engaged Chardan Capital Markets, LLC (“Chardan”), on a non-exclusive
basis, as its agent for the solicitation of the exercise of the Warrants.
The Company, at its cost, will (i) assist Chardan with respect to such
solicitation, if requested by Chardan, and (ii) provide Chardan, and direct the
Company’s transfer agent and the Warrant Agent to deliver to Chardan, lists of
the record and, to the extent known, beneficial owners of the Company’s
Warrants. The Company hereby instructs the Warrant Agent to cooperate with
Chardan in every respect in connection with Chardan’s solicitation activities,
including, but not limited to, providing to Chardan, at the Company’s cost, a
list of record and beneficial holders of the Warrants and circulating a
prospectus or offering circular disclosing the compensation arrangements
referenced in Section 3.3.5(b) below to holders of the Warrants at the time
of exercise of the Warrants. In addition to the conditions set forth in
Section 3.3.5(b), Chardan shall accept payment of the warrant solicitation
fee provided in Section 3.3.5(b) only if it has provided bona fide services
to the Company in connection with the exercise of the Warrants and only to the
extent that an investor who exercises his Warrants specifically designates, in
writing, that Chardan solicited his exercise. In addition to soliciting,
either orally or in writing, the exercise of Warrants by a Warrant holder, such
services may also include disseminating information provided by the Company,
either orally or in writing, to Warrant holders about the Company or the market
for the Company’s securities, or assisting in the processing of the exercise of
Warrants.
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(b) In
each instance in which a Warrant is exercised, the Warrant Agent shall promptly
give written notice of such exercise to the Company and Chardan (“Warrant
Agent’s Exercise Notice”). If, upon the exercise of any Warrant more than
one year from the effective date of the Registration Statement, (i) the
market price of the Common Shares is greater than the Warrant Price, (ii)
disclosure of compensation arrangements between the Company and Chardan with
respect to the solicitation of the exercise of the Warrants was made both at the
time of the Public Offering and at the time of exercise (by delivery of a
prospectus or as otherwise required by applicable law, rule or regulation),
(iii) the holder of the Warrant confirms in writing that the exercise of the
Warrant was solicited by Chardan, (iv) the Warrant was not held in a
discretionary account, and (v) the solicitation of the exercise of the Warrant
was not in violation of Regulation M (as such rule or any successor rule may be
in effect as of such time of exercise) promulgated under the Securities Exchange
Act of 1934, as amended, then the Warrant Agent, simultaneously with the
distribution of the Common Shares and Preferred Shares underlying the Warrants
so exercised in accordance with the instructions from the Company following
receipt of the proceeds to the Company received upon exercise of such
Warrant(s), shall, on behalf of the Company, pay a fee of 5% of the Warrant
Price to Chardan, provided that Chardan delivers to the Warrant Agent within ten
(10) business days from the date on which Chardan has received the Warrant
Agent’s Exercise Notice, a certificate that the conditions set forth in the
preceding clauses (iii), (iv) and (v) have been satisfied. Notwithstanding
the foregoing, no fee will be paid to Chardan with respect to the exercise by
Chardan, any underwriters or their affiliates or the Company’s officers or
directors of Warrants purchased by it or them and still held by them for its or
their own account. Chardan and the Company may at any time during business
hours, examine the records of the Warrant Agent, including its ledger of
original Warrant certificates returned to the Warrant Agent upon exercise of
Warrants.
(c) The
provisions of this Section 3.3.5. may not be modified, amended or deleted
without the prior written consent of Chardan.
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 Common Shares or
Preferred Shares is increased by a stock dividend payable in Common Shares
and/or Preferred Shares, or by a split-up of Common Shares or Preferred Shares,
or other similar event, then, on the effective date of such stock dividend,
split-up or similar event, the number of Common Shares and/or Preferred Shares
issuable on exercise of each Warrant shall be increased in proportion to such
increase in outstanding Common Shares and/or Preferred Shares.
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4.2. Aggregation of
Shares. If after the date hereof, and subject to the
provisions of Section 4.6, the number of outstanding Common Shares or
Preferred Shares is decreased by a consolidation, combination, reverse stock
split or reclassification of Common Shares or Preferred Shares or other
similar event, then, on the effective date of such consolidation, combination,
reverse stock split, reclassification or similar event, the number of Common
Shares or Preferred Shares issuable on exercise of each Warrant shall be
decreased in proportion to such decrease in outstanding Common Shares or
Preferred Shares.
4.3. Adjustments in Exercise
Price. Whenever the number of Common Shares or Preferred
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 Common Shares or
Preferred Shares purchasable upon the exercise of the Warrants immediately prior
to such adjustment, and (y) the denominator of which shall be the number of
Common Shares or Preferred Shares so purchasable immediately
thereafter.
4.4. Replacement of Securities
upon Reorganization, etc. In case of any reclassification or
reorganization of the outstanding Common Shares or Preferred Shares (other than
a change covered by Section 4.1 or 4.2 hereof or that solely affects the
par value of such Common Shares or Preferred 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 Common Shares or Preferred 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 Common Shares
or Preferred Shares immediately theretofore purchasable and receivable upon the
exercise of the rights represented thereby, the kind and amount of shares of
stock or other securities or property (including cash) receivable upon such
reclassification, reorganization, merger or consolidation, or upon a dissolution
following any such sale or transfer, that the Warrant holder would have received
if such Warrant holder had exercised his, her or its Warrant(s) immediately
prior to such event; and if any reclassification also results in a change in
Common Shares or Preferred Shares covered by Section 4.1 or 4.2, then such
adjustment shall be made pursuant to Sections 4.1, 4.2, 4.3 and this
Section 4.4. The provisions of this Section 4.4 shall
similarly apply to successive reclassifications, reorganizations, mergers or
consolidations, sales or other transfers.
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4.5. 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 or 4.4, then, in any such event,
the Company shall give written notice to each Warrant holder, at the last
address set forth for such holder in the warrant register, of the record date or
the effective date of the event. Failure to give such notice, or any
defect therein, shall not affect the legality or validity of such
event.
4.6. 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 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, within a reasonable time following such
exercise, pay an amount to the Warrant holder in cash equal to the last sales
price of such fractional Common Share and/or Preferred Share on the last trading
day prior to the date of exercise.
4.7. Form of
Warrant. The form of Warrant need not be changed because of
any adjustment pursuant to this Section 4, and Warrants issued after such
adjustment may state the same Warrant Price and the same number of shares as is
stated in the Warrants initially issued pursuant to this
Agreement. However, the Company may at any time in its sole
discretion make any change in the form of Warrant that the Company may deem
appropriate and that does not affect the substance thereof, and any Warrant
thereafter issued or countersigned, whether in exchange or substitution for an
outstanding Warrant or otherwise, may be in the form as so changed.
5. Transfer and Exchange of
Warrants.
5.1. Registration of
Transfer. The Warrant Agent shall register the transfer, from
time to time, of any outstanding Warrant upon the Warrant Register, upon
surrender of such Warrant for transfer, properly endorsed with signatures
properly guaranteed and accompanied by appropriate instructions for
transfer. Upon any such transfer, a new Warrant representing an equal
aggregate number of Warrants shall be issued and the old Warrant shall be
cancelled by the Warrant Agent. The Warrants so cancelled shall be
delivered by the Warrant Agent to the Company from time to time upon
request.
5.2. Procedure for Surrender of
Warrants. Warrants may be surrendered to the Warrant Agent,
together with a written request for exchange 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.
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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.
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 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 Common
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. Notwithstanding
the foregoing, the Registration Statement must be current for the Company to
exercise its redemption rights pursuant to this Section 6. The
provisions of this Section 6.1 may not be modified, amended or deleted
without the prior written consent of Chardan.
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.
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6.3. Exercise After Notice of
Redemption. The Warrants may be exercised for cash 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 Common Shares
and Preferred Shares. The Company shall at all times reserve
and keep available a number of its authorized but unissued Common Shares and
Preferred Shares that will be sufficient to permit the exercise in full of all
outstanding Warrants issued pursuant to this Agreement.
7.4. Registration of Common
Shares and Preferred Shares. The Company has filed with the
Securities and Exchange Commission a Registration Statement on Form S-4 File No.
333-152977 and File No. 000-000000-00 (“Registration Statement”), for the
registration, under the Securities Act of 1933, as amended (“Act”) of, among
other securities, the Warrants and the Common Shares and the Preferred Shares
issuable upon exercise of the Warrants, which Registration Statement was
declared effective by the Securities and Exchange Commission on August 7,
2009. The Company agrees that prior to the commencement of the
Exercise Period, 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
Common Shares and Preferred Shares issuable upon exercise of the
Warrants. The Company will use its best efforts to maintain the
effectiveness of such registration statement until the expiration of the
Warrants in accordance with the provisions of this Agreement. 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 jurisdiction, in the
event that an exemption is not available. The provisions of this
Section 7.4 may not be modified, amended or deleted without the prior
written consent of Chardan. Notwithstanding the foregoing, a Warrant may expire
worthless regardless of whether a registration statement is current under the
Act with respect to the Common Shares and Preferred Shares issuable upon
exercise of the Warrants in the event that such Warrant remains unexercised or
such underlying shares are not registered under the blue sky laws of the states
of residence of the warrant holders. In no event will the registered holder of a
warrant be entitled to receive a net-cash settlement, Common Shares, Preferred
Shares or other consideration in lieu of physical settlement in Common Shares or
Preferred Shares, regardless of whether Company complies with this Section
7.4.
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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 Common Shares or Preferred 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, Consolidation,
or Merger 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.
11
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 Common Shares and Preferred 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 President or
Chairman of the Board 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.
12
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 Common Shares or Preferred Shares to be issued pursuant to
this Agreement or any Warrant or as to whether any Common Shares or Preferred
Shares will when issued be valid and fully paid and nonassessable.
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 Common Shares and Preferred Shares through the exercise of
Warrants.
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:
13
000
Xxxxxx Xx, Xxxxx 000
Xxxxxxxx 000000 P.R.C.
Attn: Xxxx Xx, CFO
|
and
|
|
|
|
InterAmerican
Group
|
|
|
000
Xxxxx Xxxxxxxx Xxx., Xxxxx 000
|
|
|
Xxxxxxx,
XX 00000
Attn: Xxxxxxx X.
Xxxxx
|
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: Compliance
Department
|
with a
copy in each case to:
Xxxxxx Xxxxx Xxxxxxxx & Xxxxxxx
LLP
0000 Xxxxxx xx xxx
Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxxxxxx
X. Xxxxxxx, Esq.
and
Loeb
& Loeb LLP
000 Xxxx
Xxxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Attention: Xxxxxxxx X. Xxxxxxxx,
Esq.
and
Chardan Capital Markets,
LLC
00 Xxxxx Xxxxxx, Xxxxx
0000
Xxx Xxxx, X.X. 00000
Attn: Xxxxxx
Xxxxxxx
14
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 conflicts of law principles that
would result in the application of the substantive laws of another
jurisdiction. 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 inconvenience
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 and 9.2 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 and 9.2
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 and 9.2 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.
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.
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.
15
IN
WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto as
of the day and year first above written.
| Attest: | CNC DEVELOPMENT LTD. | |||
|
|
By:
|
|||
| Name: Xxxxxxx X. Xxxxx | ||||
| Title: Chief Executive Officer | ||||
| Attest: | CONTINENTAL
STOCK TRANSFER
&
TRUST COMPANY
|
|||
|
|
By:
|
|||
| Name: | ||||
| Title: | ||||
| Acknowledged and agreed: | ||
| CHARDAN CAPITAL MARKETS, LLC | ||
|
By:
|
||
| Name: | ||
| Title: | ||
