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,...
Exhibit 4.6
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 ONE YEAR FOLLOWING THE EFFECTIVE DATE (DEFINED
BELOW) TO ANYONE OTHER THAN (I) XXXXXX, XXXXX XXXXX, INCORPORATED (“XXXXXX”) OR AN UNDERWRITER OR A
SELECTED DEALER IN CONNECTION WITH THE OFFERING, OR (II) A BONA FIDE OFFICER OR PARTNER OF XXXXXX
OR OF ANY SUCH UNDERWRITER OR SELECTED DEALER.
THIS PURCHASE OPTION IS NOT EXERCISABLE PRIOR TO THE
LATER OF THE CONSUMMATION BY CHINA HEALTHCARE
ACQUISITION CORP. OF A MERGER, CAPITAL STOCK EXCHANGE, ASSET ACQUISITION OR OTHER SIMILAR BUSINESS
COMBINATION (“BUSINESS COMBINATION”) (AS DESCRIBED MORE FULLY IN THE COMPANY’S REGISTRATION
STATEMENT (DEFINED HEREIN) OR
, 2007. VOID AFTER 5:00 P.M. EASTERN TIME,
, 2011.
UNIT PURCHASE OPTION
For the Purchase of
500,000 Units
of
1. Purchase Option.
THIS CERTIFIES THAT, in consideration of $100 duly paid by or on behalf of
(“Holder”), as registered owner of this Purchase Option, to China Healthcare
Acquisition Corp. (“Company”), Holder is entitled, at any time or from time to time upon the later
of the consummation of a Business Combination or
, 2007 (“Commencement Date”), and at or
before 5:00 p.m., Eastern Time,
, 2011 (“Expiration Date”), but not thereafter, to
subscribe for, purchase and receive, in whole or in part, up to Five Hundred Thousand (500,000)
units (“Units”) of the Company, each Unit
1
consisting of one share of common stock of the Company,
par value $.0001 per share (“Common Stock”), and two warrants (“Warrant(s)”) expiring five years
from the effective date
(“Effective Date”) of the Company’s registration statement on Form S-1 (“Registration Statement”)
pursuant to which Units are offered for sale to the public (“Offering”). Each Warrant is the same
as the warrant included in the Units being registered for sale to the public by way of the
Registration Statement (“Public Warrants”) except that the Warrants included in the Purchase Option
have an exercise price of $6.25 per share (125% of the exercise price of the Public Warrants),
subject to adjustment as provided in Section 6 hereof. If the Expiration Date is a day on which
banking institutions are authorized by law to close, then this Purchase Option may be exercised on
the next succeeding day which 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 $7.50 per Unit
(125% of the price of the Units sold in the Offering) so purchased; provided, however, that upon
the occurrence of any of the events specified in Section 6 hereof, the rights granted by this
Purchase Option, including the exercise price per Unit and the number of Units (and shares of
Common Stock and Warrants) to be received upon such exercise, shall be adjusted as therein
specified. The term “Exercise Price” shall mean the initial exercise price or the adjusted
exercise price, depending on the context.
2. Exercise.
2.1 Exercise Form.
In order to exercise this Purchase Option, the exercise form
attached hereto must be duly executed and completed and delivered to the Company, together with
this Purchase Option and payment of the Exercise Price for the Units being purchased payable in
cash or by certified check or official bank check. If the subscription rights represented hereby
shall not be exercised at or before 5:00 p.m., Eastern time, on the Expiration Date, this Purchase
Option 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 securities purchased under this Purchase Option
shall bear a legend as follows unless such securities have been registered under the Securities Act
of 1933, as amended (“Act”):
“The securities represented by
this certificate have not been registered under the
Securities Act of 1933, as amended (“Act”) or applicable state law. The securities
may not be offered for sale, sold or otherwise transferred except pursuant to an
effective registration statement under the Act, or pursuant to an exemption from
registration under the Act and applicable state law.”
2.3 Cashless Exercise.
2.3.1 Determination of Amount. 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 Common Stock 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 (“Conversion Right”) as follows: upon exercise of the
Conversion Right, the Company shall deliver to the Holder (without payment by the Holder of
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any of
the Exercise Price in cash) 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 Price (as defined below) of a Unit. 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 Price of a Unit multiplied by the number of
Units underlying the portion of the Purchase Option being converted. The “Current Market Price” of
a Unit shall mean (i) if the Unit is listed on a national securities exchange or quoted on the
Nasdaq National Market, Nasdaq SmallCap Market or NASD OTC Bulletin Board (or successor such as the
Bulletin Board Exchange), the average closing price of a Unit for thirty (30) trading days
immediately preceding the date of determination of the Current Market Price in the principal
trading market for the Unit as reported by the exchange, Nasdaq or the NASD, as the case may be;
(ii) if the Unit is not listed on a national securities exchange or quoted on the Nasdaq National
Market, Nasdaq SmallCap Market or the NASD OTC Bulletin Board (or successor such as the Bulletin
Board Exchange), but is traded in the residual over-the-counter market, the closing bid price for
the Unit 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 Unit cannot be determined pursuant to clause (i) or (ii) above, such price as
the Board of Directors of the Company (the “Board”) shall determine, in good faith.
2.3.2 Mechanics of Cashless Exercise. The Cashless Exercise Right 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 a 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 Cashless Exercise
Right.
3. Transfer.
3.1 General
Restrictions. 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 one
year following the Effective Date to anyone other than (i) Xxxxxx or an underwriter or a selected
dealer participating in the Offering, or (ii) a bona fide officer or partner of Xxxxxx or of any
such underwriter or selected dealer. On and after the first anniversary of the Effective Date,
transfers to others may be made subject to compliance with or exemptions from applicable securities
laws. In order to make any permitted assignment, the Holder must deliver to the Company the
assignment form attached hereto 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 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.
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
3
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 Xxxxxxx Xxxxxx 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 the offer and sale of such securities has been filed by the Company and
declared effective by the Securities and Exchange Commission 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 the event of the
exercise or assignment hereof in part only, upon surrender of this Purchase Option for
cancellation, together with the duly executed exercise or assignment form and funds sufficient to
pay any Exercise Price and/or transfer tax if exercised pursuant to Section 2.1 hereto, the Company
shall cause to be delivered to the Holder without charge a new Purchase Option of like tenor to
this Purchase Option in the name of the Holder evidencing the right of the Holder to purchase the
number of Units purchasable hereunder as to which this Purchase Option has not been exercised or
assigned.
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 (“Demand Notice”) of the
Holder(s) of at least 51% of the Purchase Options and/or the underlying Units and/or the underlying
securities (“Majority Holders”), agrees to register on one occasion, all or any portion of the
Common Stock, the Warrants and the Common Stock underlying the Warrants underlying such Purchase
Options (collectively, the “Registrable Securities”) as requested by the Majority Holders in the
Demand Notice, provided that no such registration will be required unless the Holders request
registration of an aggregate of at least 51% of the outstanding Registrable Securities. On such
occasion, the Company will file a new registration statement or a post-effective amendment to the
Registration Statement covering the Registrable Securities within sixty days after receipt of the
Demand Notice and use its best efforts to have such registration statement or post-effective
amendment declared effective as soon as possible thereafter. The demand for registration may be
made at any time during a period of four years beginning on the first anniversary of the Effective
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 days from the date of the receipt of
4
any such Demand Notice, who shall have
five days from the receipt of such Notice in which to
notify the Company of their desire to have their Registrable Securities included in the
Registration Statement.
5.1.2 Terms. The Company shall bear all fees and expenses attendant to registering
the Registrable Securities, including the reasonable expenses of any legal counsel selected by the
Holders to represent them in connection with the sale of the Registrable Securities, but the
Holders shall pay any and all underwriting commissions, if any. The Company agrees to use its
commercially reasonable 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 execute a
general consent to service of process, 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 twelve consecutive months from the
effective date of such registration statement or post-effective amendment or until the Holders have
completed the distribution of the Registrable Securities included in the Registration Statement,
whichever occurs first.
5.1.3. Deferred Filing. If (i) in the good faith judgment of the Board, filing a
registration statement pursuant to Section 5.1 would be seriously detrimental to the Company and
the Board concludes, as a result, that it is essential to defer the filing of such registration
statement at such time, and (ii) the Company shall furnish to such Holders a certificate signed by
the President of the Company stating that in the good faith judgment of the Board it would be
seriously detrimental to the Company for such registration statement to be filed in the near future
and that it is, therefore, essential to defer the filing of such registration statement, then the
Company shall have the right to defer such filing on two occasions for an aggregate of not more
than one hundred and twenty (120) days in any twelve-month period.
5.1.4. No Cash Settlement Option. The Company is only required to use its best efforts
to cause a registration statement covering issuance of the Registrable Securities to be declared effective, and once effective, only to use its best efforts to
maintain the effectiveness of the registration statement. The Company will not be obligated to
deliver any Registrable Securities, and there are no contractual
penalties for failure to deliver any such securities, if a
registration statement is not effective at the time of exercise. The
failure or inability of the Company to maintain the effectiveness of
such registration statement shall not in any way prevent the
expiration of this Purchase Option on the Expiration Date. Additionally, in no event is the
Company obligated to settle any Purchase Option, in whole or in part, for cash.
5.2 “Piggy-Back”
Registration.
5.2.1 Grant of Right. In addition to the demand right of registration, the Holders of
the Purchase Options shall have the right for a period of seven years commencing on the Effective
Date, to include the Registrable Securities as part of any other registration of securities filed
by the Company (other than in connection with a transaction contemplated by Rule 145(a) promulgated
under the Act or pursuant to Form S-8 or any successor or equivalent
5
form); 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 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 will still be required to include the Registrable Securities, but
may require the Holders to agree, in writing, to delay the sale of all or any portion of the
Registrable Securities for a period of 90 days from the effective date of the offering, provided,
further, that if the sale of any Registrable Securities is so delayed, then the number of
securities to be sold by all stockholders in such public offering shall be apportioned pro rata
among all such selling stockholders, including all holders of the Registrable Securities, according
to the total amount of securities of the Company owned by said selling stockholders, including all
holders of the Registrable Securities.
5.2.2 Terms. The Company shall bear all fees and expenses attendant to registering
the Registrable Securities, including the expenses of any legal counsel selected by the Holders to
represent them in connection with the sale of the Registrable Securities, but the Holders shall pay
any and all underwriting commissions. In the event of such a proposed registration, the Company
shall furnish the then Holders of outstanding Registrable Securities with not less than fifteen
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 business 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 that does not relate to a firm commitment underwritten offering to remain
effective for at least nine consecutive months from the effective date of such registration
statement or until the Holders have completed the distribution of the Registrable Securities in the
registration statement, whichever occurs first.
5.3 Damages.
Intentionally omitted.
5.4 General Terms.
5.4.1 Indemnification. The Company shall indemnify the Holder(s) of the Registrable
Securities to be sold pursuant to any registration statement hereunder 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 (“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 litigation, commenced or threatened, or
any claim whatsoever) to which any of them may become subject under the Act, the Exchange Act or
otherwise, arising from such registration statement but 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 of the Underwriting Agreement in the Offering. The Holder(s) of the
Registrable Securities to be sold pursuant to such registration statement, and their successors and
assigns, shall severally, and not jointly, indemnify the
6
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 of the Underwriting Agreement pursuant to which the underwriters
have agreed to indemnify the Company.
5.4.2 Exercise of Purchase Options. Nothing contained in this Purchase Option shall
be construed as requiring the Holder(s) to exercise their Purchase Options or Warrants underlying
such Purchase Options prior to or after the initial filing of any registration statement or the
effectiveness thereof; provided however, that if the Company shall exercise its right to redeem the
Public Warrants, the Holders shall, on or prior to the date fixed for such redemption, exercise
this Unit Purchase Option in full.
5.4.3 Documents Delivered to Holders. The Company shall furnish Xxxxxx, 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 (or, 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; provided however, that in the case of
an underwritten offering, the provisions of the underwriting agreement described in Section 5.4.4
shall control. The Company shall also deliver promptly to Xxxxxx, 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 Xxxxxx, 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 National
Association of Securities Dealers, Inc. (“NASD”). 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 Xxxxxx, as representative of the Holders, shall reasonably request. The Company shall
not be required to disclose any confidential information or other records to Xxxxxx, as
representative of the Holders, or to any other person, until and unless such persons shall have
entered into confidentiality agreements (in form and substance reasonably satisfactory to the
Company) with the Company with respect thereto.
7
5.4.4 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, 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 or as are customarily required of selling shareholders in a firm
commitment underwritten offering. 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.
5.4.5 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 Holder, where such Holder 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 then held by such Holder.
5.4.6 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, or that would otherwise require
disclosure of material nonpublic information that, if disclosed at such time, would be materially
harmful to the Company, such Holder will immediately discontinue disposition of Registrable
Securities pursuant to the Registration Statement covering such Registrable Securities until such
Holder’s receipt of the copies of a supplemental or amended prospectus, or the public disclosure
and dissemination of such information, as the case may be, and, if so desired by the Company, such
Holder 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 Xxxxxx’s possession, of the prospectus covering such Registrable Securities current at the
time of receipt of such notice.
8
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, and subject to the
provisions of Section 6.3 below, the number of outstanding shares of Common Stock is increased by a
stock dividend payable in shares of Common Stock or by a split up of shares of Common Stock or
other similar event, then, on the effective day thereof, the number of shares of Common Stock
underlying each of the Units purchasable hereunder shall be increased in proportion to such
increase in outstanding shares. In such case, the number of shares of Common Stock, 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 Warrant Agreement governing the
Warrants (the “Warrant Agreement”). 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
$7.50 per whole Unit (the Warrant underlying the Units is exercisable for $6.25 per share), upon
effectiveness of the dividend, this Purchase Option will be adjusted to allow for the purchase of
one Unit at $7.50 per Unit, each Unit entitling the holder to receive two shares of Common Stock
and four Warrants (each Warrant exercisable for $3.125 per share).
6.1.2 Aggregation of Shares. If after the date hereof, and subject to the provisions
of Section 6.3, the number of outstanding shares of Common Stock is decreased by a consolidation,
combination or reclassification of shares of Common Stock or other similar event, then, on the
effective date thereof, the number of shares of Common Stock underlying each of the Units
purchasable hereunder shall be decreased in proportion to such decrease in outstanding shares. In
such case, the number of shares of Common Stock, 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 shares of Common Stock other than a change
covered by Section 6.1.1 or 6.1.2 hereof or that solely affects the par value of such shares of
Common Stock, 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
shares of Common Stock), 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 Holder 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 Holder of the number of shares of Common
Stock 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 shares of
Common Stock covered by Section 6.1.1 or 6.1.2, then such
9
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.
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 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 Holder 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 into, another corporation (other than a consolidation or merger which
does not result in any reclassification or change of the outstanding Common Stock), the corporation
formed by such consolidation or merger shall execute and deliver to the Holder 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
shares of Common Stock 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 shares of Common Stock 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 to the nearest whole number of Warrants, shares of Common Stock or other
securities, properties or rights.
7. Reservation and Listing. The Company shall
at all times reserve and keep available out
of its authorized shares of Common Stock, solely for the purpose of issuance upon exercise of the
Purchase Options or the Warrants underlying the Purchase Option, such number of shares of Common
Stock 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, in accordance with the terms hereby, all shares of Common Stock 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, in accordance with the terms of the Warrant
Agreement, all shares of Common Stock 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
commercially reasonable efforts to cause all (i) shares of
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Common Stock issuable upon exercise of the Purchase
Options, (ii) Warrants issuable upon exercise
of the Purchase Options and (iii) shares of Common Stock 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 National
Market, SmallCap Market, OTC Bulletin Board or any successor trading market) on which the Units,
Common Stock or the Public Warrants issued to the public in the Offering may then be listed and/or
quoted.
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 or to receive notice 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 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 shares of Common Stock for the purpose of entitling them to receive
a dividend or distribution payable otherwise than in cash, or a cash dividend or distribution
payable otherwise than out of retained earnings, as indicated by the accounting treatment of such
dividend or distribution on the books of the Company, (ii) the Company shall offer to all the
holders of its Common Stock any additional shares of capital stock of the Company or securities
convertible into 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 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 (“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 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, or mailed by express mail or private courier service: (i) If to the registered Holder
of the Purchase Option, to the address of such Holder as shown on the books of the
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Company, or (ii) if to the Company, to following
address or to such other address as the
Company may designate by notice to the Holders:
9. Miscellaneous.
9.1 Amendments.
The Company and Xxxxxx 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 Xxxxxx may xxxx necessary or desirable and that the Company and
Xxxxxx xxxx 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.
10. 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.
10.1 Binding Effect.
This Purchase Option shall inure solely to the benefit of and
shall be binding upon, the Holder 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.
10.2 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 Maryland,
without giving effect to conflict of laws. The Company hereby agrees that any action, proceeding
or claim against it arising out of, or relating in any way to this Purchase Option shall be brought
and enforced in the courts of the State of Maryland or of the United States of America for the
Southern District of Maryland, and irrevocably submits to such jurisdiction, which jurisdiction
shall be exclusive. The Company hereby waives any objection to such exclusive jurisdiction and
that such courts represent an inconvenient forum. Any 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
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upon the Company in any action, proceeding or claim.
The Company and the Holder 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.
10.3 Waiver, Etc.
The failure of the Company or the Holder 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 Holder 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.
10.4 Execution in
Counterparts. This Purchase Option may be executed in one or more
counterparts, and by the different parties hereto in separate counterparts, each of which shall be
deemed to be an original, but all of which taken together shall constitute one and the same
agreement, and shall become effective when one or more counterparts has been signed by each of the
parties hereto and delivered to each of the other parties hereto.
10.5 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 Holder, if the Company and Xxxxxx enter into an agreement (“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.
[Remainder of page deliberately left
blank]
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IN WITNESS WHEREOF, the
Company has caused this Purchase Option to be signed by its duly
authorized officer as of the ___ day of
, 2006.
| CHINA HEALTHCARE ACQUISITION CORP. | ||||
| By: | ||||
| Name: Xxxxx Xxx | ||||
| Its: Chief Executive Officer | ||||
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Form to be used to exercise Purchase Option:
Date:
, 200__
The undersigned hereby elects irrevocably to exercise the within Purchase Option and to
purchase ______ Units of China Healthcare Acquisition Corp. and hereby makes payment of
$
(at the rate of $
per Unit) in payment of the Exercise Price pursuant
thereto. Please issue the Common Stock 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.
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Form to be used to assign Purchase Option:
ASSIGNMENT
(To be executed by the registered Holder 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 China Healthcare Acquisition Corp. (“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.
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