COMMON STOCK GREENSHOE PURCHASE WARRANT CHINA INTEGRATED ENERGY, INC.
COMMON
STOCK GREENSHOE PURCHASE WARRANT
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Greenshoe
Shares: _______
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Initial
Exercise Date: July __, 2011
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Issue
Date: January __, 2011
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THIS
COMMON STOCK PURCHASE GREENSHOE WARRANT (the “Greenshoe”) certifies
that, for value received, _____________ or its assigns (the “Holder”) is entitled,
upon the terms and subject to the limitations on exercise and the conditions
hereinafter set forth, at any time on or after July __, 2011 (the “Initial Exercise
Date”) and on or prior to the close of business on January __, 2012 (the
“Termination
Date”) but not thereafter, to subscribe for and purchase from China
Integrated Energy, Inc., a Delaware corporation (the “Company”), up to
______ shares (as subject to adjustment hereunder, the “Greenshoe Shares”) of
Common Stock. The purchase price of one share of Common Stock under this
Greenshoe shall be equal to the Exercise Price, as defined in Section
2(b).
Section
1. Definitions. Capitalized
terms used and not otherwise defined herein shall have the meanings set forth in
that certain Securities Purchase Agreement (the “Purchase Agreement”),
dated January 3, 2011, among the Company and the purchasers signatory
thereto.
Section
2. Exercise.
a) Exercise
of the purchase rights represented by this Greenshoe may be made, in whole or in
part, at any time or times on or after the Initial Exercise Date and on or
before the Termination Date by delivery to the Company (or such other office or
agency of the Company as it may designate by notice in writing to the registered
Holder at the address of the Holder appearing on the books of the Company) of a
duly executed facsimile copy of the Notice of Exercise Form annexed hereto.
Within three (3) Trading Days following the date of exercise as aforesaid, the
Holder shall deliver the aggregate Exercise Price for the shares specified in
the applicable Notice of Exercise by wire transfer or cashier’s check drawn on a
United States bank unless the cashless exercise procedure specified in Section
2(c) below is specified in the applicable Notice of Exercise. Notwithstanding
anything herein to the contrary, the Holder shall not be required to physically
surrender this Greenshoe to the Company until the Holder has purchased all of
the Greenshoe Shares available hereunder and the Greenshoe has been exercised in
full, in which case, the Holder shall surrender this Greenshoe to the Company
for cancellation within three (3) Trading Days of the date the final Notice of
Exercise is delivered to the Company. Partial exercises of this Greenshoe
resulting in purchases of a portion of the total number of Greenshoe Shares
available hereunder shall have the effect of lowering the outstanding number of
Greenshoe Shares purchasable hereunder in an amount equal to the applicable
number of Greenshoe Shares purchased. The Holder and the Company
shall maintain records showing the number of Greenshoe Shares purchased and the
date of such purchases. The Company shall deliver any objection to any Notice of
Exercise Form within two (2) Business Days of receipt of such
notice. The Holder
and any assignee, by acceptance of this Greenshoe, acknowledge and agree that,
by reason of the provisions of this paragraph, following the purchase of a
portion of the Greenshoe Shares hereunder, the number of Greenshoe Shares
available for purchase hereunder at any given time may be less than the amount
stated on the face hereof.
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b) Exercise
Price. The exercise price per share of the Common Stock under
this Greenshoe shall be $7.50, subject to adjustment
hereunder (the “Exercise
Price”).
c) Cashless Exercise. If
at the time of exercise hereof there is no effective registration statement
registering, or the prospectus contained therein is not available for the
issuance of the Greenshoe Shares to the Holder and all of the Greenshoe Shares
are not then registered for resale by Holder into the market at market prices
from time to time on an effective registration statement for use on a continuous
basis (or the prospectus contained therein is not available for use), then this
Greenshoe may also be exercised, in whole or in part, at such time by means of a
“cashless exercise” in which the Holder shall be entitled to receive a
certificate for the number of Greenshoe Shares equal to the quotient obtained by
dividing [(A-B) (X)] by (A), where:
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(A)
=
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the
VWAP on the Trading Day immediately preceding the date on which Holder
elects to exercise this Greenshoe by means of a “cashless exercise,” as
set forth in the applicable Notice of Exercise;
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(B)
=
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the
Exercise Price of this Greenshoe, as adjusted hereunder;
and
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(X)
=
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the
number of Greenshoe Shares that would be issuable upon exercise of this
Greenshoe in accordance with the terms of this Greenshoe if such exercise
were by means of a cash exercise rather than a cashless
exercise.
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“VWAP” means, for any
date, the price determined by the first of the following clauses that applies:
(a) if the Common Stock is then listed or quoted on a Trading Market, the daily
volume weighted average price of the Common Stock for such date (or the nearest
preceding date) on the Trading Market on which the Common Stock is then listed
or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m.
(New York City time) to 4:02 p.m. (New York City time)), (b) if the OTC
Bulletin Board is not a Trading Market, the volume weighted average price of the
Common Stock for such date (or the nearest preceding date) on the OTC Bulletin
Board, (c) if the Common Stock is not then listed or quoted for trading on the
OTC Bulletin Board and if prices for the Common Stock are then reported in the
“Pink Sheets” published by Pink OTC Markets, Inc. (or a similar organization or
agency succeeding to its functions of reporting prices), the most recent bid
price per share of the Common Stock so reported, or (d) in all other cases,
the fair market value of a share of Common Stock as determined by an independent
appraiser selected in good faith by the Holders of a majority in interest of the
Securities then outstanding and reasonably acceptable to the Company, the fees
and expenses of which shall be paid by the Company.
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d) Mechanics of
Exercise.
i.
Delivery of
Certificates Upon Exercise. Certificates for shares purchased
hereunder shall be transmitted by the Transfer Agent to the Holder by crediting
the account of the Holder’s prime broker with The Depository Trust Company
through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company
is then a participant in such system and there is an effective registration
statement permitting the issuance of the Greenshoe Shares to or resale of the
Greenshoe Shares by Holder, and otherwise by physical delivery to the address
specified by the Holder in the Notice of Exercise by the date that is three (3)
Trading Days after the latest of (A) the delivery to the Company of the Notice
of Exercise, (B) surrender of this Greenshoe (if required) and (C) payment of
the aggregate Exercise Price as set forth above (including by cashless exercise,
if permitted) (such date, the “Greenshoe Share Delivery
Date”). The Greenshoe Shares shall be deemed to have
been issued, and Holder or any other person so designated to be named therein
shall be deemed to have become a holder of record of such shares for all
purposes, as of the date the Greenshoe has been exercised, with payment to the
Company of the Exercise Price (or by cashless exercise, if permitted) and all
taxes required to be paid by the Holder, if any, pursuant to Section 2(d)(vi)
prior to the issuance of such shares, having been paid.
ii.
Delivery
of New Greenshoes Upon Exercise. If this Greenshoe shall have
been exercised in part, the Company shall, at the request of a Holder and upon
surrender of this Greenshoe certificate, at the time of delivery of the
certificate or certificates representing Greenshoe Shares, deliver to the Holder
a new Greenshoe evidencing the rights of the Holder to purchase the unpurchased
Greenshoe Shares called for by this Greenshoe, which new Greenshoe shall in all
other respects be identical with this Greenshoe.
iii. Rescission
Rights. If the Company fails to cause the Transfer Agent to
transmit to the Holder a certificate or the certificates representing the
Greenshoe Shares pursuant to Section 2(d)(i) by the Greenshoe Share Delivery
Date, then the Holder will have the right to rescind such exercise.
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iv. Compensation for Buy-In on
Failure to Timely Deliver Certificates Upon Exercise. In
addition to any other rights available to the Holder, if the Company fails to
cause the Transfer Agent to transmit to the Holder a certificate or the
certificates representing the Greenshoe Shares pursuant to an exercise on or
before the Greenshoe Share Delivery Date, and if after such date the Holder is
required by its broker to purchase (in an open market transaction or otherwise)
or the Holder’s brokerage firm otherwise purchases, shares of Common Stock to
deliver in satisfaction of a sale by the Holder of the Greenshoe Shares which
the Holder anticipated receiving upon such exercise (a “Buy-In”), then the
Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the
Holder’s total purchase price (including brokerage commissions, if any) for the
shares of Common Stock so purchased exceeds (y) the amount obtained by
multiplying (1) the number of Greenshoe Shares that the Company was required to
deliver to the Holder in connection with the exercise at issue times (2) the
price at which the sell order giving rise to such purchase obligation was
executed, and (B) at the option of the Holder, either reinstate the portion of
the Greenshoe and equivalent number of Greenshoe Shares for which such exercise
was not honored (in which case such exercise shall be deemed rescinded) or
deliver to the Holder the number of shares of Common Stock that would have been
issued had the Company timely complied with its exercise and delivery
obligations hereunder. For example, if the Holder purchases Common
Stock having a total purchase price of $11,000 to cover a Buy-In with respect to
an attempted exercise of shares of Common Stock with an aggregate sale price
giving rise to such purchase obligation of $10,000, under clause (A) of the
immediately preceding sentence the Company shall be required to pay the Holder
$1,000. The Holder shall provide the Company written notice indicating the
amounts payable to the Holder in respect of the Buy-In and, upon request of the
Company, evidence of the amount of such loss. Nothing herein shall
limit a Holder’s right to pursue any other remedies available to it hereunder,
at law or in equity including, without limitation, a decree of specific
performance and/or injunctive relief with respect to the Company’s failure to
timely deliver certificates representing shares of Common Stock upon exercise of
the Greenshoe as required pursuant to the terms hereof.
v.
No Fractional Shares
or Scrip. No fractional shares or scrip representing
fractional shares shall be issued upon the exercise of this
Greenshoe. As to any fraction of a share which the Holder would
otherwise be entitled to purchase upon such exercise, the Company shall, at its
election, either pay a cash adjustment in respect of such final fraction in an
amount equal to such fraction multiplied by the Exercise Price or round up to
the next whole share.
vi. Charges, Taxes and
Expenses. Issuance of certificates for Greenshoe Shares shall
be made without charge to the Holder for any issue or transfer tax or other
incidental expense in respect of the issuance of such certificate, all of which
taxes and expenses shall be paid by the Company, and such certificates shall be
issued in the name of the Holder or in such name or names as may be directed by
the Holder; provided, however, that in the
event certificates for Greenshoe Shares are to be issued in a name other than
the name of the Holder, this Greenshoe when surrendered for exercise shall be
accompanied by the Assignment Form attached hereto duly executed by the Holder
and the Company may require, as a condition thereto, the payment of a sum
sufficient to reimburse it for any transfer tax incidental thereto.
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vii. Closing of
Books. The Company will not close its stockholder books or
records in any manner which prevents the timely exercise of this Greenshoe,
pursuant to the terms hereof.
e) Xxxxxx’s Exercise
Limitations. The Company shall not effect any exercise of this
Greenshoe, and a Holder shall not have the right to exercise any portion of this
Greenshoe, pursuant to Section 2 or otherwise, to the extent that after giving
effect to such issuance after exercise as set forth on the applicable Notice of
Exercise, the Holder (together with the Holder’s Affiliates, and any other
Persons acting as a group together with the Holder or any of the Holder’s
Affiliates), would beneficially own in excess of the Beneficial Ownership
Limitation (as defined below). For purposes of the foregoing sentence, the
number of shares of Common Stock beneficially owned by the Holder and its
Affiliates shall include the number of shares of Common Stock issuable upon
exercise of this Greenshoe with respect to which such determination is being
made, but shall exclude the number of shares of Common Stock which would be
issuable upon (i) exercise of the remaining, nonexercised portion of this
Greenshoe beneficially owned by the Holder or any of its Affiliates and (ii)
exercise or conversion of the unexercised or nonconverted portion of any other
securities of the Company (including, without limitation, any
other Common Stock Equivalents) subject to a limitation on conversion
or exercise analogous to the limitation contained herein beneficially owned by
the Holder or any of its Affiliates. Except as set forth in the preceding
sentence, for purposes of this Section 2(e), beneficial ownership shall be
calculated in accordance with Section 13(d) of the Exchange Act and the rules
and regulations promulgated thereunder, it being acknowledged by the Holder that
the Company is not representing to the Holder that such calculation is in
compliance with Section 13(d) of the Exchange Act and the Holder is solely
responsible for any schedules required to be filed in accordance
therewith. To the extent that the limitation contained in this
Section 2(e) applies, the determination of whether this Greenshoe is exercisable
(in relation to other securities owned by the Holder together with any
Affiliates) and of which portion of this Greenshoe is exercisable shall be in
the sole discretion of the Holder, and the submission of a Notice of Exercise
shall be deemed to be the Holder’s determination of whether this Greenshoe is
exercisable (in relation to other securities owned by the Holder together with
any Affiliates) and of which portion of this Greenshoe is exercisable, in each
case subject to the Beneficial Ownership Limitation, and the Company shall have
no obligation to verify or confirm the accuracy of such
determination. In addition, a determination as to any group
status as contemplated above shall be determined in accordance with Section
13(d) of the Exchange Act and the rules and regulations promulgated
thereunder. For purposes of this Section 2(e), in determining the
number of outstanding shares of Common Stock, a Holder may rely on the number of
outstanding shares of Common Stock as reflected in (A) the Company’s most recent
periodic or annual report filed with the Commission, as the case may be, (B) a
more recent public announcement by the Company or (C) a more recent written
notice by the Company or the Transfer Agent setting forth the number of shares
of Common Stock outstanding. Upon the written or oral request of a Holder,
the Company shall within two Trading Days confirm orally and in writing to the
Holder the number of shares of Common Stock then outstanding. In any case,
the number of outstanding shares of Common Stock shall be determined after
giving effect to the conversion or exercise of securities of the Company,
including this Greenshoe, by the Holder or its Affiliates since the date as of
which such number of outstanding shares of Common Stock was
reported. The “Beneficial Ownership
Limitation” shall be 4.99% of the number of shares of the Common Stock
outstanding immediately after giving effect to the issuance of shares of Common
Stock issuable upon exercise of this Greenshoe. The Holder, upon not
less than 61 days’ prior notice to the Company, may increase or decrease the
Beneficial Ownership Limitation provisions of this Section 2(e), provided that
the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of
shares of the Common Stock outstanding immediately after giving effect to the
issuance of shares of Common Stock upon exercise of this Greenshoe held by the
Holder and the provisions of this Section 2(e) shall continue to
apply. Any such increase or decrease will not be effective until the
61st
day after such notice is delivered to the Company. The provisions of
this paragraph shall be construed and implemented in a manner otherwise than in
strict conformity with the terms of this Section 2(e) to correct this paragraph
(or any portion hereof) which may be defective or inconsistent with the intended
Beneficial Ownership Limitation herein contained or to make changes or
supplements necessary or desirable to properly give effect to such limitation.
The limitations contained in this paragraph shall apply to a successor holder of
this Greenshoe.
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Section
3. Certain
Adjustments.
a) Stock Dividends and
Splits. If the Company, at any time while this Greenshoe is outstanding:
(i) pays a stock dividend or otherwise makes a distribution or distributions on
shares of its Common Stock or any other equity or equity equivalent securities
payable in shares of Common Stock (which, for avoidance of doubt, shall not
include any shares of Common Stock issued by the Company upon exercise of this
Greenshoe), (ii) subdivides outstanding shares of Common Stock into a larger
number of shares, (iii) combines (including by way of reverse stock split)
outstanding shares of Common Stock into a smaller number of shares, or (iv)
issues by reclassification of shares of the Common Stock any shares of capital
stock of the Company, then in each case the Exercise Price shall be multiplied
by a fraction of which the numerator shall be the number of shares of Common
Stock (excluding treasury shares, if any) outstanding immediately before such
event and of which the denominator shall be the number of shares of Common Stock
outstanding immediately after such event, and the number of shares issuable upon
exercise of this Greenshoe shall be proportionately adjusted such that the
aggregate Exercise Price of this Greenshoe shall remain
unchanged. Any adjustment made pursuant to this Section 3(a) shall
become effective immediately after the record date for the determination of
stockholders entitled to receive such dividend or distribution and shall become
effective immediately after the effective date in the case of a subdivision,
combination or re-classification.
b) [INTENTIONALLY
DELETED]
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c) Subsequent Rights
Offerings. If the Company, at any time while the Greenshoe is
outstanding, shall issue rights, options or warrants to all holders of Common
Stock (and not to the Holder) entitling them to subscribe for or purchase shares
of Common Stock at a price per share less than the VWAP on the record date
mentioned below, then the Exercise Price shall be multiplied by a fraction, of
which the denominator shall be the number of shares of the Common Stock
outstanding on the date of issuance of such rights, options or warrants plus the
number of additional shares of Common Stock offered for subscription or
purchase, and of which the numerator shall be the number of shares of the Common
Stock outstanding on the date of issuance of such rights, options or warrants
plus the number of shares which the aggregate offering price of the total number
of shares so offered (assuming receipt by the Company in full of all
consideration payable upon exercise of such rights, options or warrants) would
purchase at such VWAP. Such adjustment shall be made whenever such
rights, options or warrants are issued, and shall become effective immediately
after the record date for the determination of stockholders entitled to receive
such rights, options or warrants.
d) Pro Rata
Distributions. If the Company, at any time while this
Greenshoe is outstanding, shall distribute to all holders of Common Stock (and
not to the Holder) evidences of its indebtedness or assets (including cash and
cash dividends) or rights or warrants to subscribe for or purchase any security,
then in each such case the Exercise Price shall be adjusted by multiplying the
Exercise Price in effect immediately prior to the record date fixed for
determination of stockholders entitled to receive such distribution by a
fraction of which the denominator shall be the VWAP determined as of the record
date mentioned above, and of which the numerator shall be such VWAP on such
record date less the then per share fair market value at such record date of the
portion of such assets or evidence of indebtedness so distributed applicable to
one outstanding share of the Common Stock as determined by the Board of
Directors in good faith. In either case the adjustments shall be
described in a statement provided to the Holder of the portion of assets or
evidences of indebtedness so distributed or such subscription rights applicable
to one share of Common Stock. Such adjustment shall be made whenever
any such distribution is made and shall become effective immediately after the
record date mentioned above.
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e) Fundamental
Transaction. If, at any time while this Greenshoe is outstanding, (i) the
Company, directly or indirectly, in one or more related transactions effects any
merger or consolidation of the Company with or into another Person, (ii) the
Company, directly or indirectly, effects any sale, lease, license, assignment,
transfer, conveyance or other disposition of all or substantially all of its
assets in one or a series of related transactions, (iii) any, direct or
indirect, purchase offer, tender offer or exchange offer (whether by the Company
or another Person) is completed pursuant to which holders of Common Stock are
permitted to sell, tender or exchange their shares for other securities, cash or
property and has been accepted by the holders of 50% or more of the outstanding
Common Stock, (iv) the Company, directly or indirectly, in one or more related
transactions effects any reclassification, reorganization or recapitalization of
the Common Stock or any compulsory share exchange pursuant to which the Common
Stock is effectively converted into or exchanged for other securities, cash or
property, or (v) the Company, directly or indirectly, in one or more related
transactions consummates a stock or share purchase agreement or other business
combination (including, without limitation, a reorganization, recapitalization,
spin-off or scheme of arrangement) with another Person or group of Persons
whereby such other Person or group acquires more than 50% of the outstanding
shares of Common Stock (not including any shares of Common Stock held by the
other Person or other Persons making or party to, or associated or affiliated
with the other Persons making or party to, such stock or share purchase
agreement or other business combination) (each a “Fundamental
Transaction”), then, upon any subsequent exercise of this Greenshoe, the
Holder shall have the right to receive, for each Greenshoe Share that would have
been issuable upon such exercise immediately prior to the occurrence of such
Fundamental Transaction, at the option of the Holder (without regard to any
limitation in Section 2(e) on the exercise of this Greenshoe), the number of
shares of Common Stock of the successor or acquiring corporation or of the
Company, if it is the surviving corporation, and any additional consideration
(the “Alternate
Consideration”) receivable as a result of such Fundamental Transaction by
a holder of the number of shares of Common Stock for which this Greenshoe is
exercisable immediately prior to such Fundamental Transaction (without regard to
any limitation in Section 2(e) on the exercise of this
Greenshoe). For purposes of any such exercise, the determination of
the Exercise Price shall be appropriately adjusted to apply to such Alternate
Consideration based on the amount of Alternate Consideration issuable in respect
of one share of Common Stock in such Fundamental Transaction, and the Company
shall apportion the Exercise Price among the Alternate Consideration in a
reasonable manner reflecting the relative value of any different components of
the Alternate Consideration. If holders of Common Stock are given any
choice as to the securities, cash or property to be received in a Fundamental
Transaction, then the Holder shall be given the same choice as to the Alternate
Consideration it receives upon any exercise of this Greenshoe following such
Fundamental Transaction.
f) Calculations. All
calculations under this Section 3 shall be made to the nearest cent or the
nearest 1/100th of a share, as the case may be. For purposes of this Section 3,
the number of shares of Common Stock deemed to be issued and outstanding as of a
given date shall be the sum of the number of shares of Common Stock (excluding
treasury shares, if any) issued and outstanding.
g) Notice to
Holder.
i.
Adjustment to Exercise
Price. Whenever the Exercise Price is adjusted pursuant to any provision
of this Section 3, the Company shall promptly mail to the Holder a notice
setting forth the Exercise Price after such adjustment and any resulting
adjustment to the number of Greenshoe Shares and setting forth a brief statement
of the facts requiring such adjustment.
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ii.
Notice to Allow
Exercise by Xxxxxx. If (A) the Company shall declare a dividend (or any
other distribution in whatever form) on the Common Stock, (B) the Company shall
declare a special nonrecurring cash dividend on or a redemption of the Common
Stock, (C) the Company shall authorize the granting to all holders of the Common
Stock rights or warrants to subscribe for or purchase any shares of capital
stock of any class or of any rights, (D) the approval of any stockholders of the
Company shall be required in connection with any reclassification of the Common
Stock, any consolidation or merger to which the Company is a party, any sale or
transfer of all or substantially all of the assets of the Company, or any
compulsory share exchange whereby the Common Stock is converted into other
securities, cash or property, or (E) the Company shall authorize the voluntary
or involuntary dissolution, liquidation or winding up of the affairs of the
Company, then, in each case, the Company shall cause to be mailed to the Holder
at its last address as it shall appear upon the Greenshoe Register of the
Company, at least 20 calendar days prior to the applicable record or effective
date hereinafter specified, a notice stating (x) the date on which a record is
to be taken for the purpose of such dividend, distribution, redemption, rights
or warrants, or if a record is not to be taken, the date as of which the holders
of the Common Stock of record to be entitled to such dividend, distributions,
redemption, rights or warrants are to be determined or (y) the date on which
such reclassification, consolidation, merger, sale, transfer or share exchange
is expected to become effective or close, and the date as of which it is
expected that holders of the Common Stock of record shall be entitled to
exchange their shares of the Common Stock for securities, cash or other property
deliverable upon such reclassification, consolidation, merger, sale, transfer or
share exchange; provided that the failure to mail such notice or any defect
therein or in the mailing thereof shall not affect the validity of the corporate
action required to be specified in such notice. To the extent that
any notice provided hereunder constitutes, or contains, material, non-public
information regarding the Company or any of the Subsidiaries, the Company shall
simultaneously file such notice with the Commission pursuant to a Current Report
on Form 8-K. The Holder shall remain entitled to exercise this
Greenshoe during the period commencing on the date of such notice to the
effective date of the event triggering such notice except as may otherwise be
expressly set forth herein.
Section
4. Transfer of
Greenshoe.
a) Transferability. This
Greenshoe and all rights hereunder (including, without limitation, any
registration rights) are transferable, in whole or in part, upon surrender of
this Greenshoe at the principal office of the Company or its designated agent,
together with a written assignment of this Greenshoe substantially in the form
attached hereto duly executed by the Holder or its agent or attorney and funds
sufficient to pay any transfer taxes payable upon the making of such
transfer. Upon such surrender and, if required, such payment, the
Company shall execute and deliver a new Greenshoe or Greenshoes in the name of
the assignee or assignees, as applicable, and in the denomination or
denominations specified in such instrument of assignment, and shall issue to the
assignor a new Greenshoe evidencing the portion of this Greenshoe not so
assigned, and this Greenshoe shall promptly be cancelled. The
Greenshoe, if properly assigned in accordance herewith, may be exercised by a
new holder for the purchase of Greenshoe Shares without having a new Greenshoe
issued.
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b) New Greenshoes. This
Greenshoe may be divided or combined with other Greenshoes upon presentation
hereof at the aforesaid office of the Company, together with a written notice
specifying the names and denominations in which new Greenshoes are to be issued,
signed by the Holder or its agent or attorney. Subject to compliance
with Section 4(a), as to any transfer which may be involved in such division or
combination, the Company shall execute and deliver a new Greenshoe or Greenshoes
in exchange for the Greenshoe or Greenshoes to be divided or combined in
accordance with such notice. All Greenshoes issued on transfers or exchanges
shall be dated the initial issuance date of this Greenshoe and shall be
identical with this Greenshoe except as to the number of Greenshoe Shares
issuable pursuant thereto.
c) Greenshoe Register.
The Company shall register this Greenshoe, upon records to be maintained by the
Company for that purpose (the “Greenshoe Register”),
in the name of the record Holder hereof from time to time. The
Company may deem and treat the registered Holder of this Greenshoe as the
absolute owner hereof for the purpose of any exercise hereof or any distribution
to the Holder, and for all other purposes, absent actual notice to the
contrary.
Section
5. Miscellaneous.
a) No Rights as Stockholder
Until Exercise. This Greenshoe does not entitle the Holder to
any voting rights, dividends or other rights as a stockholder of the Company
prior to the exercise hereof as set forth in Section 2(d)(i).
b) Loss, Theft, Destruction or
Mutilation of Greenshoe. The Company covenants that upon receipt by the
Company of evidence reasonably satisfactory to it of the loss, theft,
destruction or mutilation of this Greenshoe or any stock certificate relating to
the Greenshoe Shares, and in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to it (which, in the case of the Greenshoe,
shall not include the posting of any bond), and upon surrender and cancellation
of such Greenshoe or stock certificate, if mutilated, the Company will make and
deliver a new Greenshoe or stock certificate of like tenor and dated as of such
cancellation, in lieu of such Greenshoe or stock certificate.
c) Saturdays, Sundays,
Holidays, etc. If the last or appointed day for the taking of
any action or the expiration of any right required or granted herein shall not
be a Business Day, then, such action may be taken or such right may be exercised
on the next succeeding Business Day.
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d) Authorized
Shares.
The
Company covenants that, during the period the Greenshoe is outstanding, it will
reserve from its authorized and unissued Common Stock a sufficient number of
shares to provide for the issuance of the Greenshoe Shares upon the exercise of
any purchase rights under this Greenshoe. The Company further
covenants that its issuance of this Greenshoe shall constitute full authority to
its officers who are charged with the duty of executing stock certificates to
execute and issue the necessary certificates for the Greenshoe Shares upon the
exercise of the purchase rights under this Greenshoe. The Company
will take all such reasonable action as may be necessary to assure that such
Greenshoe Shares may be issued as provided herein without violation of any
applicable law or regulation, or of any requirements of the Trading Market upon
which the Common Stock may be listed. The Company covenants that all
Greenshoe Shares which may be issued upon the exercise of the purchase rights
represented by this Greenshoe will, upon exercise of the purchase rights
represented by this Greenshoe and payment for such Greenshoe Shares in
accordance herewith, be duly authorized, validly issued, fully paid and
nonassessable and free from all taxes, liens and charges created by the Company
in respect of the issue thereof (other than taxes in respect of any transfer
occurring contemporaneously with such issue).
Except
and to the extent as waived or consented to by the Holder, the Company shall not
by any action, including, without limitation, amending its certificate of
incorporation or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities or any other voluntary action,
avoid or seek to avoid the observance or performance of any of the terms of this
Greenshoe, but will at all times in good faith assist in the carrying out of all
such terms and in the taking of all such actions as may be necessary or
appropriate to protect the rights of Holder as set forth in this Greenshoe
against impairment. Without limiting the generality of the foregoing,
the Company will (i) not increase the par value of any Greenshoe Shares above
the amount payable therefor upon such exercise immediately prior to such
increase in par value, (ii) take all such action as may be necessary or
appropriate in order that the Company may validly and legally issue fully paid
and nonassessable Greenshoe Shares upon the exercise of this Greenshoe and (iii)
use commercially reasonable efforts to obtain all such authorizations,
exemptions or consents from any public regulatory body having jurisdiction
thereof, as may be, necessary to enable the Company to perform its obligations
under this Greenshoe.
Before
taking any action which would result in an adjustment in the number of Greenshoe
Shares for which this Greenshoe is exercisable or in the Exercise Price, the
Company shall obtain all such authorizations or exemptions thereof, or consents
thereto, as may be necessary from any public regulatory body or bodies having
jurisdiction thereof.
e) Jurisdiction. All
questions concerning the construction, validity, enforcement and interpretation
of this Greenshoe shall be determined in accordance with the provisions of the
Purchase Agreement.
f) Restrictions. The
Holder acknowledges that the Greenshoe Shares acquired upon the exercise of this
Greenshoe, if not registered, will have restrictions upon resale imposed by
state and federal securities laws.
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g) Nonwaiver and
Expenses. No course of dealing or any delay or failure to
exercise any right hereunder on the part of Holder shall operate as a waiver of
such right or otherwise prejudice the Holder’s rights, powers or
remedies. Without limiting any other provision of this Greenshoe or
the Purchase Agreement, if the Company willfully and knowingly fails to comply
with any provision of this Greenshoe, which results in any material damages to
the Holder, the Company shall pay to the Holder such amounts as shall be
sufficient to cover any costs and expenses including, but not limited to,
reasonable attorneys’ fees, including those of appellate proceedings, incurred
by the Holder in collecting any amounts due pursuant hereto or in otherwise
enforcing any of its rights, powers or remedies hereunder.
h) Notices. Any
notice, request or other document required or permitted to be given or delivered
to the Holder by the Company shall be delivered in accordance with the notice
provisions of the Purchase Agreement.
i)
Limitation
of Liability. No provision hereof, in the absence of any
affirmative action by the Holder to exercise this Greenshoe to purchase
Greenshoe Shares, and no enumeration herein of the rights or privileges of the
Holder, shall give rise to any liability of the Holder for the purchase price of
any Common Stock or as a stockholder of the Company, whether such liability is
asserted by the Company or by creditors of the Company.
j)
Remedies. The
Holder, in addition to being entitled to exercise all rights granted by law,
including recovery of damages, will be entitled to specific performance of its
rights under this Greenshoe. The Company agrees that monetary damages
would not be adequate compensation for any loss incurred by reason of a breach
by it of the provisions of this Greenshoe and hereby agrees to waive and not to
assert the defense in any action for specific performance that a remedy at law
would be adequate.
k) Successors and
Assigns. Subject to applicable securities laws, this Greenshoe
and the rights and obligations evidenced hereby shall inure to the benefit of
and be binding upon the successors and permitted assigns of the Company and the
successors and permitted assigns of Holder. The provisions of this
Greenshoe are intended to be for the benefit of any Holder from time to time of
this Greenshoe and shall be enforceable by the Holder or holder of Greenshoe
Shares.
l)
Amendment. This
Greenshoe may be modified or amended or the provisions hereof waived with the
written consent of the Company and the Holder.
m) Severability. Wherever
possible, each provision of this Greenshoe shall be interpreted in such manner
as to be effective and valid under applicable law, but if any provision of this
Greenshoe shall be prohibited by or invalid under applicable law, such provision
shall be ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provisions or the remaining provisions of
this Greenshoe.
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n) Headings. The
headings used in this Greenshoe are for the convenience of reference only and
shall not, for any purpose, be deemed a part of this Greenshoe.
********************
(Signature
Page Follows)
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IN
WITNESS WHEREOF, the Company has caused this Greenshoe to be executed by its
officer thereunto duly authorized as of the date first above
indicated.
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By:
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Name:
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Title:
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NOTICE
OF EXERCISE
(1) The
undersigned hereby elects to purchase ________ Greenshoe Shares of the Company
pursuant to the terms of the attached Greenshoe (only if exercised in full), and
tenders herewith payment of the exercise price in full, together with all
applicable transfer taxes, if any.
(2) Payment
shall take the form of (check applicable box):
o in lawful money of
the United States; or
o [if permitted] the
cancellation of such number of Greenshoe Shares as is necessary, in accordance
with the formula set forth in subsection 2(c), to exercise this Greenshoe with
respect to the maximum number of Greenshoe Shares purchasable pursuant to the
cashless exercise procedure set forth in subsection 2(c).
(3) Please
issue a certificate or certificates representing said Greenshoe Shares in the
name of the undersigned or in such other name as is specified
below:
_______________________________
The
Greenshoe Shares shall be delivered to the following DWAC Account Number or by
physical delivery of a certificate to:
_______________________________
_______________________________
_______________________________
[SIGNATURE
OF HOLDER]
Name of
Investing Entity:
________________________________________________________________________
Signature of Authorized Signatory of
Investing Entity:
_________________________________________________
Name of
Authorized Signatory:
___________________________________________________________________
Title of
Authorized Signatory:
____________________________________________________________________
Date:
________________________________________________________________________________________
ASSIGNMENT
FORM
(To
assign the foregoing warrant, execute
this form
and supply required information.
Do not
use this form to exercise the warrant.)
FOR VALUE
RECEIVED, [____] all of or [_______] shares of the foregoing Greenshoe and all
rights evidenced thereby are hereby assigned to
_______________________________________________
whose address is
_______________________________________________________________.
_______________________________________________________________
Dated: ______________,
_______
Holder’s
Signature: _____________________________
Holder’s
Address: _____________________________
_____________________________
Signature
Guaranteed: ___________________________________________
NOTE: The
signature to this Assignment Form must correspond with the name as it appears on
the face of the Greenshoe, without alteration or enlargement or any change
whatsoever, and must be guaranteed by a bank or trust
company. Officers of corporations and those acting in a fiduciary or
other representative capacity should file proper evidence of authority to assign
the foregoing Greenshoe.
