No. 97 - A - 01
CHINA PACIFIC, INC.
COMMON STOCK PURCHASE WARRANT
NEITHER THIS WARRANT NOR THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE
HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT"), NOR UNDER ANY STATE SECURITIES LAW AND SHALL NOT BE TRANSFERRED, SOLD,
ASSIGNED OR HYPOTHECATED IN VIOLATION THEREOF UNTIL EITHER (i) A REGISTRATION
STATEMENT WITH RESPECT THERETO IS DECLARED EFFECTIVE UNDER THE ACT AND
APPLICABLE STATE SECURITIES LAW OR (ii) THE COMPANY RECEIVES AN OPINION OF
COUNSEL TO THE COMPANY OR OTHER COUNSEL TO THE HOLDER OF SUCH SECURITIES WHICH
OPINION IS SATISFACTORY TO THE COMPANY AND ITS COUNSEL THAT SUCH SECURITIES MAY
BE TRANSFERRED, SOLD, ASSIGNED OR HYPOTHECATED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT OR APPLICABLE STATE SECURITIES LAWS.
CHINA PACIFIC, INC., a Nevada corporation (the "Company"), hereby certifies
that, for value received, CORSTONE CORPORATION or his permitted registered
successors and assigns (the "Holder"), is entitled, subject to the terms and
conditions set forth below, to purchase from the Company 300,000 fully paid and
nonassessable shares of Common Stock, $.001 par value per share (the "Common
Stock"), of the Company at the purchase price per share set forth below during
the exercise period described below.
1. Exercise of Warrant.
1.1 The exercise price (the "Exercise Price") of this Warrant shall be
$4.00 per share.
1.2 The rights represented by this Warrant shall be exercisable for a
period commencing on the date hereof and expiring five years from said
date (the "Exercise Period").
1.3 The rights represented by this Warrant may be exercised at any time
within the Exercise Period, in whole or in part, by (i) the surrender
of this Warrant (with the purchase form at the end hereof properly
executed) at the principal offices of the Company (or such other
office or agency of the Company as it may designate by notice in
writing to the Holder at the address of the Holder appearing on the
books of the Company); and (ii) payment to the Company, in cash,
certified check or other means satisfactory to the Company, of the
Exercise Price then in effect for the number of shares of Common Stock
specified in the above-mentioned purchase form together with
applicable stock transfer taxes, if any. If this Warrant shall be
exercised in part, the Company shall, upon surrender of this Warrant,
execute and deliver a new Warrant evidencing the rights of the holder
to purchase the balance of the shares underlying this Warrant.
1.4 Upon proper tender of the Exercise Price and purchase form in
accordance with paragraph 1.3 above, the Company shall issue, or cause
to be issued, to the Holder one or more certificates evidencing
ownership of the number of shares of Common Stock with respect to
which this Warrant has been properly exercised. In any event, assuming
proper exercise, the Company shall deliver such certificate(s) within
thirty (30) days following receipt of the items required by paragraph
1.3 above.
2. Anti-Dilution Provisions. The Exercise Price in effect at any time and the
number and kind of securities purchasable upon the exercise of this Warrant
shall be subject to adjustment from time to time upon the happening of
certain events as follows:
a. If the Company shall (i) declare a dividend or make a distribution on
its outstanding shares of Common Stock in shares of Common Stock, (ii)
subdivide or reclassify its shares, or (iii) combine or reclassify its
outstanding shares of Common Stock into a smaller number of shares,
the Exercise Price in effect at the time of the effective date or
record date, as the case may be, for such sale, dividend or
distribution or of the effective date of such subdivision, combination
or reclassification shall be adjusted so that it shall equal the price
determined by multiplying the Exercise Price by a fraction, the
denominator of which shall be the number of shares of Common Stock
outstanding after giving effect to such action, and the numerator of
which shall be the number of shares of Common Stock outstanding
immediately prior to such action. No adjustment shall be made for any
cash dividends.
b. Whenever the Exercise Price payable upon exercise of each Warrant is
adjusted pursuant to paragraph 2.a. above, the number of shares of
Common Stock purchasable upon exercise of this Warrant shall
simultaneously be adjusted by multiplying the number shares of Common
Stock initially issuable upon exercise of this Warrant by the Exercise
Price in effect on the date hereof and dividing the product so
obtained by the Exercise Price, as adjusted.
c. Notwithstanding any adjustment in the Exercise Price or the number or
kind of shares of Common Stock purchasable upon the exercise of this
Warrant, certificates for Warrants issued prior or subsequent to such
adjustment may continue to express the same price and number and kind
of shares of Common Stock as are initially expressed pursuant to this
Warrant.
d. Notwithstanding anything to the contrary in this Agreement, there
shall be no adjustment in the Exercise Price or the number or kind of
shares of Common Stock purchasable upon exercise of this Warrant
solely as a result of the Company's sale of shares of Common Stock,
including the issuance of shares of Common Stock or other change in
the capitalization of the Company as a result of the Company's
acquisition, directly or indirectly, of the assets or outstanding
capital stock of any other corporation or entity.
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3. Fractional Shares. The Company shall not be required to issue any
fractional shares of Common Stock upon exercise of this Warrant. If any
fractional interest in a share of Common Stock shall be deliverable upon
the exercise of any Warrant, the Company shall purchase such fractional
interest for an amount of cash (computed to the nearest cent) equal to the
product of such fraction multiplied by the Exercise Price then in effect.
4. Restrictions on Transfer. (a) Neither this Warrant nor the shares of Common
Stock issuable upon exercise hereof have been registered under the Act nor
under any state securities law and shall not be transferred, sold, assigned
or hypothecated in violation thereof. As a result, any such transfer, sale,
assignment or hypothecation shall be permitted only after the Company has
reviewed an opinion of counsel satisfactory to the Company and its counsel,
stating that such action is permitted under this paragraph 4 and that such
action does not violate the Act or such state securities laws.
(b) Holder has represented that it is acquiring this Warrant for its own
account and not with a view to the distribution thereof or of the
shares of Common Stock which may issued upon exercise of this Warrant.
(c) The certificates evidencing the shares of Common Stock which may be
issued upon exercise of this Warrant shall bear a legend substantially
in the form set forth at the beginning of this Warrant.
5. Redemption. This Warrant may be called for redemption by the Company in its
sole discretion upon the giving of thirty (30) days written notice to the
Holder of this Warrant and payment of the redemption price in the amount of
$.05 per Warrant, provided that the last sales price or closing bid price
for the Common Stock has equaled or exceeded $6.00 per share for at least
twenty (20) consecutive trading days preceding the date of call. The Holder
may exercise this Warrant or any portion hereof under the terms set forth
herein until the date designated in the notice of call provided in
accordance with the foregoing and accompanied by the redemption price after
which date this Warrant will no longer be exercisable.
6. Registration Rights. The Company covenants and agrees with the Holder that
if, at any time within the period commencing on the date hereof and ending
six years from the date hereof, it proposes to file a registration
statement with respect to any class of equity or equity-related security
(other than in connection with an offering to the Company's employees or in
connection with an acquisition, merger or similar transaction) under the
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Act, the Company will give prompt written notice (which shall be at least
30 days prior to such filing) to the Holders of this Warrant (including any
Holders who may have exercised this Warrant, in part or in whole) at the
addresses appearing on the records of the Company of its intention to file
a registration statement and will offer to include in such registration
statement the shares of common stock underlying this Warrant (including
shares previously issued pursuant to the exercise of this Warrant). The
Company shall include in such registration statement (at its sole expense,
other than commissions or discounts payable in connection with the sale of
the underlying shares of common stock) all shares of common stock
underlying this Warrant, or previously issued pursuant to the exercise of
this Warrant, as to which the Company shall have received written requests
for inclusion therein within ten (10) days after the giving of notice by
the Company. This paragraph is not applicable to a registration statement
filed by the Company on Forms S-4 or S-8 or any successor form. If the
registration statement with respect to which the foregoing registration
rights apply relates to an underwritten offering and the underwriter(s) for
such offering determines in good faith and advises the Company in writing
that in its/their opinion the number of shares to be included in such
registration statement pursuant to exercise of the foregoing registration
rights exceeds the number that can be sold in such offering without
materially adversely affecting the distribution of such securities, the
Company may include in such registration statement only so many of the
shares underlying the Warrants as, based on the advice of the underwriter,
shall not adversely affect the offering.
7. Covenants. The Company covenants and agrees that all shares of Common Stock
which may be issued upon exercise of this Warrant will, upon issuance, be
duly and validly issued, fully paid and nonassessable and no personal
liability will attach to the Holder thereof. The Company further covenants
and agrees that during the Exercise Period, the Company will at all times
have authorized and reserved a sufficient number of shares of its Common
Stock to provide for the exercise of this Warrant.
8. Notices. All notices and other communications hereunder shall be in writing
and deemed to have been duly given when hand-delivered, or mailed by
registered or certified mail, return receipt requested, as follows:
a. If to the Holder of this Warrant, to the address of such Xxxxxx as
shown on the books of the Company; or
b. If to the Company, to: China Pacific, Inc., 000 Xxxxxxx Xxxxxx, Xxxx
Xxxxx, Xxxxxxxxxx 00000.
9. Governing Law. This Warrant shall be construed in accordance with the laws
of the State of Nevada.
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IN WITNESS WHEREOF, the undersigned has caused this Warrant to be signed in
its corporate name by its duly authorized officer as of the 15th day of January,
1997.
CHINA PACIFIC, INC.
BY: /s/ Xxxxxxx Xxx
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Xxxxxxx Xxx
President
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PURCHASE FORM
The undersigned, , the Holder
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of Common Stock Purchase Warrant No. of CHINA
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PACIFIC, INC. evidencing the right to purchase
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shares of Common Stock of the Company, hereby elects to exercise the rights
under said Warrant as set forth below and delivers said Warrant and the Exercise
Price payable with respect to the exercise of such rights:
Name of Holder:
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Address of Holder:
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Number of Shares:
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Exercise Price Delivered:
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If the Warrant is exercised with respect to less than all of the shares
issuable upon exercise of such Warrant, please issue a new Warrant evidencing
the right to acquire the remainder of such shares.
DATED: , 19 .
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Signature:
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