THE REGISTERED HOLDER OF THIS PURCHASE OPTION BY ITS ACCEPTANCE HEREOF, AGREES THAT IT WILL NOT SELL, TRANSFER OR ASSIGN THIS PURCHASE OPTION EXCEPT AS HEREIN PROVIDED AND THE REGISTERED HOLDER OF THIS PURCHASE OPTION AGREES THAT IT WILL NOT SELL,...
THE
REGISTERED HOLDER OF THIS PURCHASE OPTION BY ITS ACCEPTANCE HEREOF, AGREES
THAT
IT WILL NOT SELL, TRANSFER OR ASSIGN THIS PURCHASE OPTION EXCEPT AS HEREIN
PROVIDED AND THE REGISTERED HOLDER OF THIS PURCHASE OPTION AGREES THAT IT WILL
NOT SELL, TRANSFER, ASSIGN, PLEDGE OR HYPOTHECATE THIS PURCHASE OPTION FOR
A
PERIOD OF ONE HUNDRED EIGHTY DAYS FOLLOWING THE EFFECTIVE DATE (DEFINED BELOW)
TO ANYONE OTHER THAN (I) XXXXXX & XXXXXXX, LLC OR AN UNDERWRITER OR A
SELECTED DEALER IN CONNECTION WITH THE OFFERING, OR (II) A BONA FIDE OFFICER
OR
PARTNER OF XXXXXX & XXXXXX SECURITIES CORPORATION OR OF ANY SUCH UNDERWRITER
OR SELECTED DEALER.
THIS
PURCHASE OPTION IS NOT EXERCISABLE PRIOR
TO
, 2009 [ONE YEAR FROM DATE OF PROSPECTUS]. VOID AFTER 5:00 P.M. EASTERN TIME,
,
2013 [FIVE YEARS THE FROM DATE OF THE PROSPECTUS].
COMMON
STOCK PURCHASE OPTION
For
the
Purchase of
________
Shares of Common Stock
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 SkyStar
Bio-Pharmaceutical Company (the “Company”), Holder is entitled, at any time or
from time to time from , 2009 [one year from date of prospectus] (the
“Commencement Date”), and at or before 5:00 p.m., Eastern Time, , 2013 [five
years from date of prospectus] (the “Expiration Date”), but not thereafter, to
subscribe for, purchase and receive, in whole or in part, up to _____________
shares of common stock of the Company, par value $.001 per share (the “Shares”)
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 $____
per
Share ([125%] of the price of the Shares 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 Share and the number of Shares 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
Shares being purchased payable in cash by wire transfer of immediately available
funds to an account designated by the Company 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.
1
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 (the “Act”):
“The
securities represented by this certificate have not been registered under the
Securities Act of 1933, as amended (the “Act”) or applicable state law. Neither
the securities nor any interest therein may 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 which, in the opinion of counsel to the Company, is
available.”
3. Transfer.
3.1 General
Restrictions. The registered Holder of this Purchase Option agrees by his,
her
or its acceptance hereof, that such Holder will not: (a) sell, transfer, assign,
pledge or hypothecate this Purchase Option for a period of one hundred eighty
(180) days following the Effective Date to anyone other than: (i) Xxxxxx &
Xxxxxxx, LLC (“Xxxxxx & Xxxxxxx”) or an underwriter or a selected dealer
participating in the Offering, or (ii) a bona fide officer of Xxxxxx &
Xxxxxxx or of any such underwriter or selected dealer, in each case in
accordance with FINRA Conduct Rule 2710(g)(1) or (b) cause this Purchase Option
or the securities issuable hereunder to be the subject of any hedging, short
sale, derivative, put or call transaction that would result in the effective
economic disposition of this Purchase Option or the securities hereunder, except
as provided for in FINRA Rule 2710(g)(2). On and after 180 days from 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 Shares 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
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 Xxxxxx & Xxxxx 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
(the “Commission”) and compliance with applicable state securities law has been
established.
4.
Registration Rights
4.1
Demand Registration.
4.1.1 Grant
of Right. The Company, upon written demand (a “Demand Notice”) of the Holder(s)
of at least 51% of the Purchase Options and/or the underlying Shares (“Majority
Holders”), agrees to register, on two occasions (at least twelve months apart),
all or any portion of the Shares underlying the Purchase Options (collectively
the “Registrable Securities”). On such occasions, the Company will file a
registration statement with the SEC covering the Registrable Securities
within
sixty (60) days after receipt of a Demand Notice and use its reasonable
best
efforts to have the registration statement declared effective promptly
thereafter, subject to compliance with review by the SEC; provided,
however,
that
the Company shall not be required to comply with a Demand Notice if the
Company
has filed a registration statement with respect to which the Holder is
entitled
to piggyback registration rights pursuant to Section 4.2 hereof and either:
(i)
the Holder has elected to participate in the offering covered by such
registration statement or (ii) if such registration statement relates to
an
underwritten primary offering of securities of the Company, until the offering
covered by such registration statement has been withdrawn or until thirty
(30)
days after such offering is consummated. The demands for registration may
be
made at any time during a period of four (4) years beginning one (1) year
from
the Closing Date. The Company covenants and agrees to give written notice
of its
receipt of any Demand Notice by any Holder(s) to all other registered Holders
of
the Purchase Options and/or the Registrable Securities within ten (10)
days from
the date of the receipt of any such Demand Notice.
4.1.2 Terms.
The Company shall bear all fees and expenses attendant to the first registration
of the Registrable Securities pursuant to Section 4.1.1, but the Holders
shall
pay any and all underwriting commissions and the expenses of any legal
counsel
selected by the Holders to represent them in connection with the sale of
the
Registrable Securities. The Holders shall bear all fees and expenses (including
all underwriting commissions and the expenses of any legal counsel selected
by
the Holders to represent them) in connection with the second registration
of the
Registrable Securities described in Section 4.1.1 hereof. The Company agrees
to
use its reasonable best efforts to cause the filing required herein to
become
effective promptly and to qualify or register the Registrable Securities
in such
States as are reasonably requested by the 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 register or license to do business in such State or submit to general
service
of process in such State, or (ii) the principal shareholders of the Company
to
be obligated to escrow their shares of capital stock of the Company. The
Company
shall cause any registration statement filed pursuant to the demand right
granted under Section 4.1.1 to remain effective for a period of at least
twelve
consecutive months from the date that the Holders of the Registrable Securities
covered by such registration statement are first given the opportunity
to sell
all of such securities. The Holders shall only use the prospectuses provided
by
the Company to sell the shares covered by such registration statements,
and will
immediately cease to use any prospectus furnished by the Company if the
Company
advises the Holder that such prospectus may no longer be used due to a
material
misstatement or omission.
2
4.2 “Piggy-Back”
Registration.
4.2.1 Grant
of Right. In addition to the demand right of registration, described in
Section
4.1 hereof the Holder shall have the right, for a period of four (4) years
commencing one (1) year from the Closing 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 equivalent form);
provided,
however,
that if,
solely in connection with any primary underwritten public offering for
the
account of the Company, the managing underwriter(s) thereof shall, in its
reasonable discretion, impose a limitation on the number of shares of Common
Stock which may be included in the Registration Statement because, in such
underwriter(s)’ judgment, marketing or other factors dictate such limitation is
necessary to facilitate public distribution, then the Company shall be
obligated
to include in such Registration Statement only such limited portion of
the
Registrable Securities with respect to which the Holder requested inclusion
hereunder as the underwriter shall reasonably permit. Any exclusion of
Registrable Securities shall be made pro rata among the Holders seeking
to
include Registrable Securities in proportion to the number of Registrable
Securities sought to be included by such Holders; provided,
however,
that
the Company shall not exclude any Registrable Securities unless the Company
has
first excluded all outstanding securities, the holders of which are not
entitled
to inclusion of such securities in such Registration Statement or are not
entitled to pro rata inclusion with the Registrable
Securities.
4.2.2 Terms.
The Company shall bear all fees and expenses attendant to registering the
Registrable Securities pursuant to Section 4.2.1 hereof, but the Holders
shall
pay any and all underwriting commissions and the expenses of any legal
counsel
selected by the Holders to represent them in connection with the sale of
the
Registrable Securities. In the event of such a proposed registration, the
Company shall furnish the then Holders of outstanding Registrable Securities
with not less than thirty (30) 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 registration statement filed by the Company until
such time
as all of the Registrable Securities have been sold by the Holder. The
holders
of the Registrable Securities shall exercise the “piggy-back” rights provided
for herein by giving written notice, within ten (10) days of the receipt
of the
Company’s notice of its intention to file a registration statement.
4.3 General
Terms.
4.3.1 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 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 __ of the Underwriting Agreement between
the
Underwriters and the Company, dated as of _______________, 2008. 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 Company, 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
8 of the Underwriting Agreement pursuant to which the Underwriters have
agreed
to indemnify the Company.
3
4.3.2 Exercise
of Purchase Options. Nothing contained in this Purchase Option shall be
construed as requiring the Holder(s) to exercise their Purchase Options
prior to
or after the initial filing of any registration statement or the effectiveness
thereof.
4.3.3 Documents
Delivered to Holders. The Company shall furnish to each Holder participating
in
any of the foregoing offerings and to each underwriter of any such offering,
if
any, a signed counterpart, addressed to such Holder or underwriter, of:
(i) an
opinion of counsel to the Company, dated the effective date of such registration
statement (and, if such registration includes an underwritten public offering,
an opinion dated the date of the closing under any underwriting agreement
related thereto), and (ii) a “cold comfort” letter dated the effective date of
such registration statement (and, if such registration includes an underwritten
public offering, a letter dated the date of the closing under the underwriting
agreement) signed by the independent public accountants who have issued
a report
on the Company’s financial statements included in such registration statement,
in each case covering substantially the same matters with respect to such
registration statement (and the prospectus included therein) and, in the
case of
such accountants’ letter, with respect to events subsequent to the date of such
financial statements, as are customarily covered in opinions of issuer’s counsel
and in accountants’ letters delivered to underwriters in underwritten public
offerings of securities. The Company shall also deliver promptly to each
Holder
participating in the offering requesting the correspondence and memoranda
described below and to the managing underwriter, if any, copies of all
correspondence between the SEC and the Company, its counsel or auditors
and all
memoranda relating to discussions with the SEC or its staff with respect
to the
registration statement and permit each Holder and underwriter 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 FINRA.
Such
investigation shall include access to books, records and properties and
opportunities to discuss the business of the Company with its officers
and
independent auditors, all to such reasonable extent and at such reasonable
times
as any such Holder shall reasonably request.
4.3.4 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 4, which managing
underwriter shall be reasonably satisfactory 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, their Shares and
their
intended methods of distribution.
4
4.3.5 Documents
to be Delivered by Xxxxxx(s). Each of the Holder(s) participating in any
of the
foregoing offerings shall furnish to the Company a completed and executed
questionnaire provided by the Company requesting information customarily
sought
of selling securityholders.
4.3.6 Damages.
Should the registration or the effectiveness thereof required by Sections
4.1
and 4.2 hereof be delayed by the Company or the Company otherwise fails
to
comply with such provisions, the Holder(s) shall, in addition to any other
legal
or other relief available to the Holder(s), be entitled to obtain specific
performance or other equitable (including injunctive) relief against the
threatened breach of such provisions or the continuation of any such breach,
without the necessity of proving actual damages and without the necessity
of
posting bond or other security.
5.
New
Purchase Options to be Issued.
5.1 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 Shares purchasable hereunder as to which
this
Purchase Option has not been exercised or assigned.
5
5.2 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.
6. Adjustments.
6.1 Adjustments
to Exercise Price and Number of Securities. The Exercise Price and the number
of
Shares underlying the Purchase Option shall be subject to adjustment from
time
to time as hereinafter set forth:
6.1.1 Share
Dividends; Split Ups. If after the date hereof, and subject to the provisions
of
Section 6.3 below, the number of outstanding Shares is increased by a stock
dividend payable in Shares or by a split up of Shares or other similar event,
then, on the effective day thereof, the number of Shares purchasable hereunder
shall be increased in proportion to such increase in outstanding shares.
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 is decreased by a consolidation,
combination or reclassification of Shares or other similar event, then, on
the
effective date thereof, the number of Shares purchasable hereunder shall
be
decreased in proportion to such decrease in outstanding shares.
6.1.3 Replacement
of Securities upon Reorganization, etc. In case of any reclassification or
reorganization of the outstanding Shares other than a change covered by Section
6.1.1 or 6.1.2 hereof or that solely affects the par value of such Shares,
or in
the case of any share reconstruction or amalgamation or consolidation of
the
Company with or into another corporation (other than a consolidation or share
reconstruction or amalgamation in which the Company is the continuing
corporation and that does not result in any reclassification or reorganization
of the outstanding Shares), or in the case of any sale or conveyance to another
corporation or entity of the property of the Company as an entirety or
substantially as an entirety in connection with which the Company is dissolved,
the 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, share reconstruction or amalgamation, or consolidation, or
upon
a dissolution following any such sale or transfer, by a Holder of the number
of
Shares of the Company obtainable upon exercise of this Purchase Option
immediately prior to such event; and if any reclassification also results
in a
change in Shares covered by Section 6.1.1 or 6.1.2, then such adjustment
shall
be made pursuant to Sections 6.1.1, 6.1.2 and this Section 6.1.3. The provisions
of this Section 6.1.3 shall similarly apply to successive reclassifications,
reorganizations, share reconstructions or amalgamations, or consolidations,
sales or other transfers.
6
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
Shares 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 share
reconstruction or amalgamation of the Company with or into, another corporation
(other than a consolidation or share reconstruction or amalgamation which
does
not result in any reclassification or change of the outstanding Shares),
the
corporation formed by such consolidation or share reconstruction or amalgamation
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 share reconstruction or amalgamation, by a holder of the
number
of Shares of the Company for which such Purchase Option might have been
exercised immediately prior to such consolidation, share reconstruction or
amalgamation, sale or transfer. Such supplemental Purchase Option shall provide
for adjustments which shall be identical to the adjustments provided in Section
7. The above provision of this Section shall similarly apply to successive
consolidations or share reconstructions or amalgamations.
6.3 Elimination
of Fractional Interests. The Company shall not be required to issue certificates
representing fractions of Shares upon the exercise of the Purchase Option,
nor
shall it be required to issue scrip or pay cash in lieu of any fractional
interests, it being the intent of the parties that all fractional interests
shall be eliminated by rounding any fraction up or down, as the case may
be, to
the nearest whole number of Shares or other securities, properties or
rights.
7.
Reservation
and Listing. The Company shall at all times reserve and keep available out
of
its authorized Shares, solely for the purpose of issuance upon exercise of
the
Purchase Options, such number of Shares or other securities, properties or
rights as shall be issuable upon the exercise thereof. The Company covenants
and
agrees that, upon exercise of the Purchase Options and payment of the Exercise
Price therefor, in accordance with the terms hereby, all Shares and other
securities issuable upon such exercise shall be duly and validly issued,
fully
paid and non-assessable and not subject to preemptive rights of any shareholder.
The Company further covenants and agrees that upon exercise of the Purchase
Options and payment of the exercise price therefor, , all Shares and other
securities issuable upon such exercise shall be duly and validly issued,
fully
paid and non-assessable and not subject to preemptive rights of any shareholder.
As long as the Purchase Options shall be outstanding, the Company shall use
its
commercially reasonable efforts to cause all Shares issuable upon exercise
of
the Purchase Options to be listed (subject to official notice of issuance)
on
all securities exchanges (or, if applicable on the Nasdaq Global Market,
Capital
Market, OTC Bulletin Board or any successor trading market) on which the
Shares
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 shareholder
for the election of directors or any other matter, or as having any rights
whatsoever as a shareholder 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 shareholders 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 shareholders of the
Company
at the same time and in the same manner that such notice is given to the
shareholders.
7
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 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
Shares 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 share reconstruction or amalgamation) 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 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:
With
a
copy to:
9. Miscellaneous.
9.1 Amendments.
The Company and Xxxxxx & Xxxxxxx 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 & Xxxxxxx may xxxx necessary or desirable and that the
Company and Xxxxxx & Xxxxxxx 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.
8
9.2 Headings.
The headings contained herein are for the sole purpose of convenience of
reference, and shall not in any way limit or affect the meaning or
interpretation of any of the terms or provisions of this Purchase
Option.
9.3. Entire
Agreement. This Purchase Option (together with the other agreements and
documents being delivered pursuant to or in connection with this Purchase
Option) constitutes the entire agreement of the parties hereto with respect
to
the subject matter hereof, and supersedes all prior agreements and
understandings of the parties, oral and written, with respect to the subject
matter hereof.
9.4 Binding
Effect. This Purchase Option shall inure solely to the benefit of and shall
be
binding upon, the 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.
9.5 Governing
Law; Submission to Jurisdiction. This Purchase Option shall be governed by
and
construed and enforced in accordance with the laws of the State of Nevada,
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
New York or of the United States District Court for the Southern District
of New
York, and irrevocably submits to such jurisdiction, which jurisdiction shall
be
exclusive. The Company hereby waives any objection to such exclusive
jurisdiction and that such courts represent an inconvenient forum. Any process
or summons to be served upon the Company may be served by transmitting a
copy
thereof by registered or certified mail, return receipt requested, postage
prepaid, addressed to it at the address set forth in Section 8 hereof. Such
mailing shall be deemed personal service and shall be legal and binding upon
the
Company in any action, proceeding or claim. The Company and the 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.
9.6 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.
9.7 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. Such counterparts may be delivered by
facsimile transmission or other electronic transmission.
9.8 Exchange
Agreement. As a condition of the Holder’s receipt and acceptance of this
Purchase Option, Xxxxxx agrees that, at any time prior to the complete exercise
of this Purchase Option by Holder, if the Company and Xxxxxx & Xxxxxxx 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.]
9
IN
WITNESS WHEREOF, the Company has caused this Purchase Option to be signed by
its
duly authorized officer as of the ___ day
of
, 2008.
10
Form
to
be used to exercise Purchase Option:
Date:
,
200__
The
undersigned hereby elects irrevocably to exercise the within Purchase Option
and
to purchase ______ Shares of Skystar Bio-Pharmaceutical Company and hereby
makes
payment of $ (at the rate of $ per Share) in payment of the Exercise Price
pursuant thereto. Please issue the Shares 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
______
Shares purchasable under the within Purchase Option by surrender of the
unexercised portion of the attached Purchase Option (with a “Value” of $______
based on a “Market Price” of $______). Please issue the Shares as to which this
Purchase Option is exercised in accordance with the instructions given
below.
--------------------------------------------------------------------------------
Signature
--------------------------------------------------------------------------------
Signature
Guaranteed
11
INSTRUCTIONS
FOR REGISTRATION OF SECURITIES
Name:
--------------------------------------------------------------------------------
(Print
in
Block Letters)
Address:
NOTICE:
The signature to this form must correspond with the name as written upon the
face of the within Purchase Option in every particular without alteration or
enlargement or any change whatsoever, and must be guaranteed by a bank, other
than a savings bank, or by a trust company or by a firm having membership on
a
registered national securities exchange.
12
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
Shares of Skystar Bio-Pharmaceutical Company (“Company”) evidenced by the within
Purchase Option and does hereby authorize the Company to transfer such right
on
the books of the Company.
Dated: ,
200_
--------------------------------------------------------------------------------
Signature
--------------------------------------------------------------------------------
Signature
Guaranteed
NOTICE:
The signature to this form must correspond with the name as written upon the
face of the within Purchase Option in every particular without alteration or
enlargement or any change whatsoever, and must be guaranteed by a bank, other
than a savings bank, or by a trust company or by a firm having membership on
a
registered national securities exchange.
13
