WARRANT AGREEMENT
Agreement made as of ________, 2011
between China Resources Development Inc., a Cayman Islands limited life exempted
company, with offices at c/o SSC Mandarin Investment Group Limited, 0000 Xxxxx
Resources Xxxxxxxx, 00 Xxxxxxx Xxxx, Xxxxxxx, Xxxx Xxxx (“Company”), and
Continental Stock Transfer & Trust Company, a New York corporation, with
offices at 00 Xxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 (“Warrant
Agent”).
WHEREAS, the Company has received
binding commitments from its officers to purchase an aggregate of 6,000,000
warrants (the “Private Placement Warrants”) pursuant to Subscription Agreements
dated as of ________, 2011 (the “Subscription Agreements”); and
WHEREAS, the Company is engaged in a
public offering (“Public Offering”) of units, each unit comprised of one
Ordinary Share (as defined below) and one Public Warrant (as defined below) (the
“Units”) and, in connection therewith, has determined to issue and deliver up to
8,625,000 Warrants (“Public Warrants” and together with the Private Placement
Warrants, the “Warrants”) to the public investors, each such Warrant evidencing
the right of the holder thereof to purchase one ordinary share of the Company,
par value $.001 per share (“Ordinary Share”), for $11.50, subject to adjustment
as described herein; and
WHEREAS, the Company has filed with the
Securities and Exchange Commission a Registration Statement on Form S-1, No.
333-171727 (“Registration Statement”), for the registration, under the
Securities Act of 1933, as amended (“Act”) of, among other securities, the
Warrants and the Ordinary Shares issuable upon exercise of the Warrants;
and
WHEREAS, the Company desires the
Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing
to so act, in connection with the issuance, registration, transfer, exchange,
redemption and exercise of the Warrants; and
WHEREAS, the Company desires to provide
for the form and provisions of the Warrants, the terms upon which they shall be
issued and exercised, and the respective rights, limitation of rights, and
immunities of the Company, the Warrant Agent, and the holders of the Warrants;
and
WHEREAS, all acts and things have been
done and performed which are necessary to make the Warrants, when executed on
behalf of the Company and countersigned by or on behalf of the Warrant Agent, as
provided herein, the valid, binding and legal obligations of the Company, and to
authorize the execution and delivery of this Agreement.
NOW, THEREFORE, in consideration of the
mutual agreements herein contained, the parties hereto agree as
follows:
1.
Appointment of Warrant
Agent. The Company hereby appoints the Warrant Agent to act as
agent for the Company for the Warrants, and the Warrant Agent hereby accepts
such appointment and agrees to perform the same in accordance with the terms and
conditions set forth in this Agreement.
2.
Warrants.
2.1.
Form of
Warrant. Each Warrant shall be issued in registered form only,
shall be in substantially the form of Exhibit A hereto, the provisions of which
are incorporated herein and shall be signed by, or bear the facsimile signature
of, the Chairman of the Board or Chief Executive Officer and Treasurer,
Secretary or Assistant Secretary of the Company and shall bear a facsimile of
the Company’s seal. In the event the person whose facsimile signature has been
placed upon any Warrant shall have ceased to serve in the capacity in which such
person signed the Warrant before such Warrant is issued, it may be issued with
the same effect as if he or she had not ceased to be such at the date of
issuance.
2.2.
Effect of
Countersignature. Unless and until countersigned by the Warrant
Agent pursuant to this Agreement, a Warrant shall be invalid and of no effect
and may not be exercised by the holder thereof.
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2.3. Registration.
2.3.1.
Warrant
Register. The Warrant Agent shall maintain books (“Warrant
Register”), for the registration of original issuance and the registration of
transfer of the Warrants. Upon the initial issuance of the Warrants, the
Warrant Agent shall issue and register the Warrants in the names of the
respective holders thereof in such denominations and otherwise in accordance
with instructions delivered to the Warrant Agent by the Company.
2.3.2.
Registered
Holder. Prior to due presentment for registration of transfer of
any Warrant, the Company and the Warrant Agent may deem and treat the person in
whose name such Warrant shall be registered upon the Warrant Register
(“registered holder”) as the absolute owner of such Warrant and of each Warrant
represented thereby (notwithstanding any notation of ownership or other writing
on the Warrant Certificate made by anyone other than the Company or the Warrant
Agent), for the purpose of any exercise thereof, and for all other purposes, and
neither the Company nor the Warrant Agent shall be affected by any notice to the
contrary.
2.4. Detachability of
Warrants. The securities comprising the Units will not be
separately transferable until five trading days following the earlier to occur
of the expiration or termination of the underwriters over-allotment option and
its exercise in full, but in no event will separate trading of the securities
comprising the Units begin until the Company files a Current Report on Form 8-K
which includes an audited balance sheet reflecting the receipt by the Company of
the gross proceeds of the Public Offering including the proceeds received by the
Company from the exercise of the over-allotment option, if the over-allotment
option is exercised on the date hereof.
2.5 Private Placement Warrant
Attributes. The Private Placement Warrants will be issued in the
same form as the Public Warrants but they (i) will be exercisable either for
cash or on a cashless basis at the holder’s option and (ii) will not be
redeemable by the Company, in either case as long as the Private Placement
Warrants are held by the initial purchasers or their affiliates and permitted
transferees (as prescribed in Section 5.6 hereof).
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3.
Terms and Exercise of
Warrants
3.1.
Warrant Price.
Each Warrant shall, when countersigned by the Warrant Agent, entitle the
registered holder thereof, subject to the provisions of such Warrant and of this
Warrant Agreement, to purchase from the Company the number of Ordinary Shares
stated therein, at the price of $11.50 per whole share, subject to the
adjustments provided in Section 4 hereof and in the last sentence of this
Section 3.1. The term “Warrant Price” as used in this Warrant Agreement
refers to the price per share at which Ordinary Shares may be purchased at the
time a Warrant is exercised. The Company in its sole discretion may lower
the Warrant Price at any time prior to the Expiration Date for a period of not
less than 10 business days; provided, however, that any such reduction shall be
identical in percentage terms among all of the Warrants.
3.2.
Duration of
Warrants. A Warrant may be exercised only during the period
(“Exercise Period”) commencing on the consummation by the Company of a merger,
share exchange, asset acquisition, share purchase, recapitalization,
reorganization or other similar business combination with one or more businesses
or entities (“Business Combination”) (as described more fully in the
Registration Statement), and terminating at 5:00 p.m., New York City time on the
earlier to occur of (i) five years from the consummation of a Business
Combination and (ii) the Redemption Date as provided in Section 6.2 of this
Agreement (“Expiration Date”). Except with respect to the right to receive
the Redemption Price (as set forth in Section 6 hereunder), each Warrant not
exercised on or before the Expiration Date shall become void, and all rights
thereunder and all rights in respect thereof under this Agreement shall cease at
the close of business on the Expiration Date. The Company in its sole
discretion may extend the duration of the Warrants by delaying the Expiration
Date; provided, however, that the Company will provide notice to registered
holders of the Warrants of such extension of not less than 20
days.
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3.3. Exercise of
Warrants.
3.3.1.
Payment.
Subject to the provisions of the Warrant and this Warrant
Agreement, a Warrant, when countersigned by the Warrant Agent, may be
exercised by the registered holder thereof by surrendering it, at the office of
the Warrant Agent, or at the office of its successor as Warrant Agent, in the
Borough of Manhattan, City and State of New York, with the subscription form, as
set forth in the Warrant, duly executed, and by paying in full the Warrant Price
for each full Ordinary Share as to which the Warrant is exercised and any and
all applicable taxes due in connection with the exercise of the Warrant, as
follows:
(a) in
cash, good certified check or good bank draft payable to the order of the
Company (or as otherwise agreed to by the Company); or
(b) in
the event of redemption pursuant to Section 6 hereof in which the Company’s
management has elected to force all holders of Warrants to exercise such
Warrants on a “cashless basis,” by surrendering the Warrants for that number of
Ordinary Shares equal to the quotient obtained by dividing (x) the product of
the number of Ordinary Shares underlying the Warrants, multiplied by the
difference between the Warrant Price and the “Fair Market Value” (defined below)
by (y) the Fair Market Value. Solely for purposes of this Section 3.3.1(b), the
“Fair Market Value” shall mean the average reported last sale price of the
Ordinary Shares for the 10 trading days ending on the third trading day prior to
the date on which the notice of redemption is sent to holders of Warrant
pursuant to Section 6 hereof; or
(c) with
respect to any Private Placement Warrants, so long as such Private Placement
Warrants are held by the initial purchasers or their affiliates, by surrendering
such Private Placement Warrants for that number of Ordinary Shares equal to the
quotient obtained by dividing (x) the product of the number of Ordinary Shares
underlying the Warrants, multiplied by the difference between the exercise price
of the Warrants and the “Fair Market Value” by (y) the Fair Market Value;
provided, however, that no cashless exercise shall be permitted unless the Fair
Market Value is higher than the exercise price. Solely for purposes of this
Section 3.3.1(c), the “Fair Market Value” shall mean the average reported last
sale price of the Ordinary Shares for the 10 trading days ending on the day
prior to the date of exercise; or
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(d) in
the event the registration statement required by Section 7.4 hereof is not
effective and current, by surrendering such Warrants for that number of Ordinary
Shares equal to the quotient obtained by dividing (x) the product of the number
of Ordinary Shares underlying the Warrants, multiplied by the difference between
the exercise price of the Warrants and the “Fair Market Value” by (y) the Fair
Market Value; provided, however, that no cashless exercise shall be permitted
unless the Fair Market Value is higher than the exercise price. Solely for
purposes of this Section 3.3.1(d), the “Fair Market Value” shall mean the
average reported last sale price of the Ordinary Shares for the 10 trading days
ending on the day prior to the date of exercise.
3.3.2.
Issuance of
Certificates. As soon as practicable after the exercise of any
Warrant and the clearance of the funds in payment of the Warrant Price (if any),
the Company shall issue to the registered holder of such Warrant a certificate
or certificates for the number of full Ordinary Shares to which he is entitled,
registered in such name or names as may be directed by him, her or it, and if
such Warrant shall not have been exercised in full, a new countersigned Warrant
for the number of shares as to which such Warrant shall not have been
exercised. Notwithstanding the foregoing, in no event will the Company be
required to net cash settle the Warrant exercise. Warrants may not be
exercised by, or securities issued to, any registered holder in any state in
which such exercise would be unlawful.
3.3.3.
Valid Issuance.
All Ordinary Shares issued upon the proper exercise of a Warrant in conformity
with this Agreement shall be validly issued, fully paid and
nonassessable.
3.3.4.
Date of
Issuance. Each person in whose name any such certificate for
Ordinary Shares is issued shall for all purposes be deemed to have become the
holder of record of such shares on the date on which the Warrant was surrendered
and payment of the Warrant Price was made, irrespective of the date of delivery
of such certificate, except that, if the date of such surrender and payment is a
date when the share transfer books of the Company are closed, such person shall
be deemed to have become the holder of such shares at the close of business on
the next succeeding date on which the share transfer books are
open.
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4.
Adjustments.
4.1. Stock Dividends - Split
Ups. If after the date hereof, and subject to the provisions of
Section 4.6 below, the number of outstanding Ordinary Shares is increased by a
stock dividend payable in Ordinary Shares, or by a split up of Ordinary Shares,
or other similar event, then, on the effective date of such stock dividend,
split up or similar event, the number of Ordinary Shares issuable on exercise of
each Warrant shall be increased in proportion to such increase in outstanding
Ordinary Shares.
4.2. Aggregation of
Shares. If after the date hereof, and subject to the provisions of
Section 4.6, the number of outstanding Ordinary Shares is decreased by a
consolidation, combination, reverse stock split or reclassification of Ordinary
Shares or other similar event, then, on the effective date of such
consolidation, combination, reverse stock split, reclassification or similar
event, the number of Ordinary Shares issuable on exercise of each Warrant shall
be decreased in proportion to such decrease in outstanding Ordinary
Shares.
4.3 Extraordinary
Dividends. If the Company, at any time while the Warrants (or
rights to purchase the Warrants) are outstanding and unexpired, shall pay a
dividend or make a distribution in cash, securities or other assets to the
holders of the Ordinary Shares on account of such Ordinary Shares (or other
shares of the Company’s capital stock into which the Warrants are convertible),
other than (a) as described in subsection 4.1 above, (b) Ordinary Cash Dividends
(as defined below), (c) to satisfy the conversion rights of the holders of the
Ordinary Shares in connection with a proposed initial Business Combination, (d)
as a result of the repurchase of Ordinary Shares by the Company in connection
with an initial Business Combination or (e) in connection with the Company’s
liquidation and the distribution of its assets upon its failure to consummate a
Business Combination (any such non-excluded event being referred to herein as an
“Extraordinary Dividend”), then the Warrant Price shall be decreased, effective
immediately after the effective date of such Extraordinary Dividend, by the
amount of cash and the fair market value (as determined by the Company’s board
of directors, in good faith) of any securities or other assets paid on each
share of the Ordinary Shares in respect of such Extraordinary Dividend. For
purposes of this subsection 4.3, “Ordinary Cash Dividends” means any cash
dividend or cash distribution which, when combined on a per share of the
Ordinary Shares basis, with the per share amounts of all other cash dividends
and cash distributions paid on the Ordinary Shares during the 365-day period
ending on the date of declaration of such dividend or distribution (as adjusted
to appropriately reflect any of the events referred to in other subsections of
this Section 4 and excluding cash dividends or cash distributions that resulted
in an adjustment to the Warrant Price or to the number of Ordinary Shares
issuable on exercise of each Warrant) does not exceed $0.50 (being 5% of the
offering price of the Units in the Offering).
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4.4 Adjustments in Exercise
Price. Whenever the number of Ordinary Shares purchasable upon the
exercise of the Warrants is adjusted, as provided in Section 4.1, 4.2 and 4.3
above, the Warrant Price shall be adjusted (to the nearest cent) by multiplying
such Warrant Price immediately prior to such adjustment by a fraction (x) the
numerator of which shall be the number of Ordinary Shares purchasable upon the
exercise of the Warrants immediately prior to such adjustment, and (y) the
denominator of which shall be the number of Ordinary Shares so purchasable
immediately thereafter.
4.5.
Replacement of Securities
upon Reorganization, etc. In case of any reclassification or
reorganization of the outstanding Ordinary Shares (other than a change covered
by Section 4.1, 4.2 or 4.3 hereof or that solely affects the par value of such
Ordinary Shares), or in the case of any merger or consolidation of the Company
with or into another corporation (other than a consolidation or merger in which
the Company is the continuing corporation and that does not result in any
reclassification or reorganization of the outstanding Ordinary Shares), or in
the case of any sale or conveyance to another corporation or entity of the
assets or other property of the Company as an entirety or substantially as an
entirety in connection with which the Company is dissolved, the Warrant holders
shall thereafter have the right to purchase and receive, upon the basis and upon
the terms and conditions specified in the Warrants and in lieu of the Ordinary
Shares of the Company immediately theretofore purchasable and receivable upon
the exercise of the rights represented thereby, the kind and amount of shares of
stock or other securities or property (including cash) receivable upon such
reclassification, reorganization, merger or consolidation, or upon a dissolution
following any such sale or transfer, that the Warrant holder would have received
if such Warrant holder had exercised his, her or its Warrant(s) immediately
prior to such event; and if any reclassification also results in a change in
Ordinary Shares covered by Section 4.1, 4.2 or 4.3, then such adjustment shall
be made pursuant to Sections 4.1, 4.2, 4.3, 4.4 and this Section 4.5. The
provisions of this Section 4.5 shall similarly apply to successive
reclassifications, reorganizations, mergers or consolidations, sales or other
transfers.
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4.6.
Notices of Changes in
Warrant. Upon every adjustment of the Warrant Price or the number
of shares issuable upon exercise of a Warrant, the Company shall give written
notice thereof to the Warrant Agent, which notice shall state the Warrant Price
resulting from such adjustment and the increase or decrease, if any, in the
number of shares purchasable at such price upon the exercise of a Warrant,
setting forth in reasonable detail the method of calculation and the facts upon
which such calculation is based. Upon the occurrence of any event
specified in Sections 4.1, 4.2, 4.3, 4.4 or 4.5, then, in any such event, the
Company shall give written notice to each Warrant holder, at the last address
set forth for such holder in the warrant register, of the record date or the
effective date of the event. Failure to give such notice, or any defect
therein, shall not affect the legality or validity of such event.
4.7.
No Fractional
Shares. Notwithstanding any provision contained in this Warrant
Agreement to the contrary, the Company shall not issue fractional shares upon
exercise of Warrants. If, by reason of any adjustment made pursuant to
this Section 4, the holder of any Warrant would be entitled, upon the exercise
of such Warrant, to receive a fractional interest in a share, the Company shall,
upon such exercise, round up or down to the nearest whole number the number of
the Ordinary Shares to be issued to the Warrant holder.
4.8.
Form of
Warrant. The form of Warrant need not be changed because of any
adjustment pursuant to this Section 4, and Warrants issued after such adjustment
may state the same Warrant Price and the same number of shares as is stated in
the Warrants initially issued pursuant to this Agreement. However, the
Company may at any time in its sole discretion make any change in the form of
Warrant that the Company may deem appropriate and that does not affect the
substance thereof, and any Warrant thereafter issued or countersigned, whether
in exchange or substitution for an outstanding Warrant or otherwise, may be in
the form as so changed.
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5.
Transfer and Exchange of
Warrants.
5.1.
Registration of
Transfer. The Warrant Agent shall register the transfer, from time
to time, of any outstanding Warrant upon the Warrant Register, upon surrender of
such Warrant for transfer, properly endorsed with signatures properly guaranteed
and accompanied by appropriate instructions for transfer. Upon any such
transfer, a new Warrant representing an equal aggregate number of Warrants shall
be issued and the old Warrant shall be cancelled by the Warrant Agent. The
Warrants so cancelled shall be delivered by the Warrant Agent to the Company
from time to time upon request.
5.2.
Procedure for Surrender of
Warrants. Warrants may be surrendered to the Warrant Agent,
together with a written request for exchange or transfer, and thereupon the
Warrant Agent shall issue in exchange therefor one or more new Warrants as
requested by the registered holder of the Warrants so surrendered, representing
an equal aggregate number of Warrants; provided, however, that in the event that
a Warrant surrendered for transfer bears a restrictive legend, the Warrant Agent
shall not cancel such Warrant and issue new Warrants in exchange therefor until
the Warrant Agent has received an opinion of counsel for the Company stating
that such transfer may be made and indicating whether the new Warrants must also
bear a restrictive legend.
5.3.
Fractional
Warrants. The Warrant Agent shall not be required to effect any
registration of transfer or exchange which will result in the issuance of a
warrant certificate for a fraction of a warrant.
5.4.
Service
Charges. No service charge shall be made for any exchange or
registration of transfer of Warrants.
5.5.
Warrant Execution and
Countersignature. The Warrant Agent is hereby authorized to
countersign and to deliver, in accordance with the terms of this Agreement, the
Warrants required to be issued pursuant to the provisions of this Section 5, and
the Company, whenever required by the Warrant Agent, will supply the Warrant
Agent with Warrants duly executed on behalf of the Company for such
purpose.
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5.6.
Private Placement
Warrants. The Warrant Agent shall not register any transfer of Private
Placement Warrants until after the consummation by the Company of a Business
Combination, except for transfers (i) to the Company’s officers and directors,
(ii) to an entity’s members upon its dissolution and liquidation, (iii) to an
entity’s officers, directors and/or employees, (iv) resulting from the death of
any holder of Private Placement Warrants and (v) to relatives and trusts for
estate planning purposes, in each case on the condition that prior to
such registration for transfer, the Warrant Agent shall be presented with
written documentation pursuant to which each transferee or the trustee or legal
guardian for such transferee agrees to be bound by the terms of the Subscription
Agreement and of the Escrow Agreement among the Company, the holders of Private
Placement Warrants and the Warrant Agent.
6.
Redemption.
6.1.
Redemption.
Subject to Section 6.4 hereof, not less than all of the outstanding Warrants may
be redeemed, at the option of the Company, at any time while they are
exercisable and prior to their expiration, at the office of the Warrant Agent,
upon the notice referred to in Section 6.2, at the price of $.01 per Warrant
(“Redemption Price”), provided that the last sales price of the Ordinary Shares
has been at least $17.50 per share (subject to adjustment in accordance with
Section 4 hereof), on each of twenty (20) trading days within any thirty (30)
trading day period ending on the third business day prior to the date on which
notice of redemption is given.
6.2.
Date Fixed for, and Notice
of, Redemption. In the event the Company shall elect to redeem all
of the Warrants, the Company shall fix a date for the redemption (the
“Redemption Date”). Notice of redemption shall be mailed by first class
mail, postage prepaid, by the Company not less than 30 days prior to the
Redemption Date to the registered holders of the Warrants to be redeemed at
their last addresses as they shall appear on the registration books. Any
notice mailed in the manner herein provided shall be conclusively presumed to
have been duly given whether or not the registered holder received such
notice.
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6.3. Exercise After Notice of
Redemption. The Warrants may be exercised, for cash (or on a
“cashless basis” in accordance with Section 3 of this Agreement) at any time
after notice of redemption shall have been given by the Company pursuant to
Section 6.2 hereof and prior to the Redemption Date. In the event the
Company determines to require all holders of Warrants to exercise their Warrants
on a “cashless basis” pursuant to Section 3.3.1(b), the notice of redemption
will contain the information necessary to calculate the number of Ordinary
Shares to be received upon exercise of the Warrants, including the “Fair Market
Value” in such case. On and after the Redemption Date, the record holder of the
Warrants shall have no further rights except to receive, upon surrender of the
Warrants, the Redemption Price.
6.4 Outstanding Warrants
Only. The Company understands that the redemption rights provided by this
Section 6 apply only to outstanding Warrants. To the extent a person holds
rights to purchase Warrants, such purchase rights shall not be extinguished by
redemption of the Warrants by the Company. However, once such purchase rights
are exercised, the Company may redeem the Warrants issued upon such exercise,
provided that the criteria for redemption are met, including the opportunity of
the Warrant holder to exercise its Warrants prior to redemption pursuant to
Section 6.3.
7.
Other Provisions Relating to
Rights of Holders of Warrants.
7.1.
No Rights as
Shareholder. A Warrant does not entitle the registered holder
thereof to any of the rights of a shareholder of the Company, including, without
limitation, the right to receive dividends, or other distributions, exercise any
preemptive rights to vote or to consent or to receive notice as shareholders in
respect of the meetings of shareholders or the election of directors of the
Company or any other matter.
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7.2.
Lost, Stolen, Mutilated, or
Destroyed Warrants. If any Warrant is lost, stolen, mutilated, or
destroyed, the Company and the Warrant Agent may on such terms as to indemnity
or otherwise as they may in their discretion impose (which shall, in the case of
a mutilated Warrant, include the surrender thereof), issue a new Warrant of like
denomination, tenor, and date as the Warrant so lost, stolen, mutilated, or
destroyed. Any such new Warrant shall constitute a substitute contractual
obligation of the Company, whether or not the allegedly lost, stolen, mutilated,
or destroyed Warrant shall be at any time enforceable by anyone.
7.3.
Reservation of Ordinary
Shares. The Company shall at all times reserve and keep available a
number of its authorized but unissued Ordinary Shares that will be sufficient to
permit the exercise in full of all outstanding Warrants issued pursuant to this
Agreement.
7.4.
Registration of Ordinary
Shares. The Company agrees that as soon as practicable, but in no
event later than ___ months after the closing of a Business Combination, it
shall use its best efforts to file with the SEC a post-effective amendment to
the Registration Statement, or a new registration statement, for the
registration, under the Act, of the Ordinary Shares issuable upon exercise of
the Warrants, and it shall use its best efforts to take such action as is
necessary to qualify for sale, in those states in which the Warrants were
initially offered by the Company, the Ordinary Shares issuable upon exercise of
the Warrants. In either case, the Company will use its best efforts to
cause the same to become effective and to maintain the effectiveness of such
registration statement until the expiration of the Warrants in accordance with
the provisions of this Agreement. In addition, the Company agrees to use
its best efforts to register such securities under the blue sky laws of the
states of residence of the exercising warrant holders to the extent an exemption
is not available, subject to the proviso above. If any such post-effective
amendment or registration statement has not been declared effective by the
___-month anniversary following the closing of the Business Combination, holders
of the Warrants shall have the right, during the period beginning on the
___-month anniversary after the closing of the Business Combination and ending
upon such post-effective amendment or registration statement being declared
effective by the SEC, and during any other period when the Company shall fail to
have maintained an effective registration statement covering the Ordinary Shares
issuable upon exercise of the Warrants, to exercise such Warrants on a “cashless
basis” as determined in accordance with Section 3.3.1(d). The Company
shall provide the Warrant Agent with an opinion of counsel for the Company
(which shall be an outside law firm with securities law experience) stating that
(i) the exercise of the Warrants on a cashless basis in accordance with this
Section 7.4 is not required to be registered under the Act and (ii) the Ordinary
Shares issued upon such exercise will be freely tradable under U.S. federal
securities laws by anyone who is not an affiliate (as such term is defined in
Rule 144 under the Act) of the Company and, accordingly, will not be required to
bear a restrictive legend. For the avoidance of any doubt, unless and
until all of the Warrants have been exercised on a cashless basis, the Company
shall continue to be obligated to comply with its registration obligations under
the first three sentences of this Section 7.4.
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8.
Concerning the Warrant Agent
and Other Matters.
8.1. Payment of
Taxes. The Company will from time to time promptly pay all taxes
and charges that may be imposed upon the Company or the Warrant Agent in respect
of the issuance or delivery of Ordinary Shares upon the exercise of Warrants,
but the Company shall not be obligated to pay any transfer taxes in respect of
the Warrants or such shares.
8.2. Resignation, Consolidation,
or Merger of Warrant Agent.
8.2.1.
Appointment of Successor
Warrant Agent. The Warrant Agent, or any successor to it hereafter
appointed, may resign its duties and be discharged from all further duties and
liabilities hereunder after giving sixty (60) days’ notice in writing to the
Company. If the office of the Warrant Agent becomes vacant by resignation
or incapacity to act or otherwise, the Company shall appoint in writing a
successor Warrant Agent in place of the Warrant Agent. If the Company
shall fail to make such appointment within a period of 30 days after it has been
notified in writing of such resignation or incapacity by the Warrant Agent or by
the holder of the Warrant (who shall, with such notice, submit his Warrant for
inspection by the Company), then the holder of any Warrant may apply to the
Supreme Court of the State of New York for the County of New York for the
appointment of a successor Warrant Agent at the Company’s cost. Any
successor Warrant Agent, whether appointed by the Company or by such court,
shall be a corporation organized and existing under the laws of the State of New
York, in good standing and having its principal office in the Borough of
Manhattan, City and State of New York, and authorized under such laws to
exercise corporate trust powers and subject to supervision or examination by
federal or state authority. After appointment, any successor Warrant Agent
shall be vested with all the authority, powers, rights, immunities, duties, and
obligations of its predecessor Warrant Agent with like effect as if originally
named as Warrant Agent hereunder, without any further act or deed; but if for
any reason it becomes necessary or appropriate, the predecessor Warrant Agent
shall execute and deliver, at the expense of the Company, an instrument
transferring to such successor Warrant Agent all the authority, powers, and
rights of such predecessor Warrant Agent hereunder; and upon request of any
successor Warrant Agent the Company shall make, execute, acknowledge, and
deliver any and all instruments in writing for more fully and effectually
vesting in and confirming to such successor Warrant Agent all such authority,
powers, rights, immunities, duties, and obligations.
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8.2.2.
Notice of Successor Warrant
Agent. In the event a successor Warrant Agent shall be appointed,
the Company shall give notice thereof to the predecessor Warrant Agent and the
transfer agent for the Ordinary Shares not later than the effective date of any
such appointment.
8.2.3.
Merger or Consolidation of
Warrant Agent. Any corporation into which the Warrant Agent may be
merged or with which it may be consolidated or any corporation resulting from
any merger or consolidation to which the Warrant Agent shall be a party shall be
the successor Warrant Agent under this Agreement without any further
act.
8.3. Fees and Expenses of Warrant
Agent.
8.3.1.
Remuneration.
The Company agrees to pay the Warrant Agent reasonable remuneration for its
services as such Warrant Agent hereunder and will reimburse the Warrant Agent
upon demand for all expenditures that the Warrant Agent may reasonably incur in
the execution of its duties hereunder.
8.3.2.
Further
Assurances. The Company agrees to perform, execute, acknowledge,
and deliver or cause to be performed, executed, acknowledged, and delivered all
such further and other acts, instruments, and assurances as may reasonably be
required by the Warrant Agent for the carrying out or performing of the
provisions of this Agreement.
15
8.4. Liability of Warrant
Agent.
8.4.1.
Reliance on Company
Statement. Whenever in the performance of its duties under this
Warrant Agreement, the Warrant Agent shall deem it necessary or desirable that
any fact or matter be proved or established by the Company prior to taking or
suffering any action hereunder, such fact or matter (unless other evidence in
respect thereof be herein specifically prescribed) may be deemed to be
conclusively proved and established by a statement signed by the Chief Executive
Officer or Chairman of the Board of the Company and delivered to the Warrant
Agent. The Warrant Agent may rely upon such statement for any action taken
or suffered in good faith by it pursuant to the provisions of this
Agreement.
8.4.2.
Indemnity. The
Warrant Agent shall be liable hereunder only for its own negligence, willful
misconduct or bad faith. The Company agrees to indemnify the Warrant Agent
and save it harmless against any and all liabilities, including judgments, costs
and reasonable counsel fees, for anything done or omitted by the Warrant Agent
in the execution of this Agreement except as a result of the Warrant Agent’s
negligence, willful misconduct, or bad faith.
8.4.3.
Exclusions. The
Warrant Agent shall have no responsibility with respect to the validity of this
Agreement or with respect to the validity or execution of any Warrant (except
its countersignature thereof); nor shall it be responsible for any breach by the
Company of any covenant or condition contained in this Agreement or in any
Warrant; nor shall it be responsible to make any adjustments required under the
provisions of Section 4 hereof or responsible for the manner, method, or amount
of any such adjustment or the ascertaining of the existence of facts that would
require any such adjustment; nor shall it by any act hereunder be deemed to make
any representation or warranty as to the authorization or reservation of any
Ordinary Shares to be issued pursuant to this Agreement or any Warrant or as to
whether any Ordinary Shares will when issued be valid and fully paid and
nonassessable.
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8.5. Acceptance of
Agency. The Warrant Agent hereby accepts the agency
established by this Agreement and agrees to perform the same upon the terms and
conditions herein set forth and among other things, shall account promptly to
the Company with respect to Warrants exercised and concurrently account for, and
pay to the Company, all moneys received by the Warrant Agent for the purchase of
Ordinary Shares through the exercise of Warrants.
9. Miscellaneous
Provisions.
9.1. Successors. All
the covenants and provisions of this Agreement by or for the benefit of the
Company or the Warrant Agent shall bind and inure to the benefit of their
respective successors and assigns.
9.2. Notices. Any
notice, statement or demand authorized by this Warrant Agreement to be given or
made by the Warrant Agent or by the holder of any Warrant to or on the Company
shall be sufficiently given when so delivered if by hand or overnight delivery
or if sent by certified mail or private courier service within five days after
deposit of such notice, postage prepaid, addressed (until another address is
filed in writing by the Company with the Warrant Agent), as
follows:
c/o SSC
Mandarin Investment Group Limited
0000
Xxxxx Resources Xxxxxxxx
00
Xxxxxxx Xxxx, Xxxxxxx
Xxxx
Xxxx
Attn: Chief
Executive Officer
Any
notice, statement or demand authorized by this Agreement to be given or made by
the holder of any Warrant or by the Company to or on the Warrant Agent shall be
sufficiently given when so delivered if by hand or overnight delivery or if sent
by certified mail or private courier service within five days after deposit of
such notice, postage prepaid, addressed (until another address is filed in
writing by the Warrant Agent with the Company), as
follows:
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Continental
Stock Transfer & Trust Company
00
Xxxxxxx Xxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Attn: Compliance
Department
with a
copy in each case to:
Xxxxxxxx
Xxxxxx
The
Chrysler Building
000
Xxxxxxxxx Xxxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Attn: Xxxxx
Xxxx Xxxxxx, Esq.
and
Skadden,
Arps, Slate, Xxxxxxx & Xxxx LLP
000
Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxx
Xxxx, Xxxxxxxxxx 00000
Attn: Xxxxxx
X. Xxxx, Esq.
and
Lazard
Capital Markets LLC
00
Xxxxxxxxxxx Xxxxx
Xxx Xxxx,
XX, 00000
Attn: Xxxx
Xxxxxx
9.3. Applicable
Law. The validity, interpretation, and performance of this
Agreement and of the Warrants shall be governed in all respects by the laws of
the State of New York, without giving effect to conflicts of law principles that
would result in the application of the substantive laws of another
jurisdiction. The Company hereby agrees that any action, proceeding
or claim against it arising out of or relating in any way to this Agreement
shall be brought and enforced in the courts of the State of New York or the
United States District Court for the Southern District of New York, and
irrevocably submits to such jurisdiction, which jurisdiction shall be
exclusive. The Company hereby waives any objection to such exclusive
jurisdiction and that such courts represent an inconvenience
forum. Any such process or summons to be served upon the Company may
be served by transmitting a copy thereof by registered or certified mail, return
receipt requested, postage prepaid, addressed to it at the address set forth in
Section 9.2 hereof. Such mailing shall be deemed personal service and
shall be legal and binding upon the Company in any action, proceeding or
claim.
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9.4. Persons Having Rights under
this Agreement. Nothing in this Agreement expressed and
nothing that may be implied from any of the provisions hereof is intended, or
shall be construed, to confer upon, or give to, any person or corporation other
than the parties hereto and the registered holders of the Warrants and, for the
purposes of Section 9.2 hereof, Lazard Freres & Co. LLC, any right, remedy,
or claim under or by reason of this Warrant Agreement or of any covenant,
condition, stipulation, promise, or agreement hereof. Lazard Freres
& Co. LLC shall be deemed to be a third-party beneficiary of this Agreement
with respect to Section 9.2 hereof. All covenants, conditions,
stipulations, promises, and agreements contained in this Warrant Agreement shall
be for the sole and exclusive benefit of the parties hereto (and Lazard Freres
& Co. LLC with respect to the Sections 9.2 hereof) and their successors and
assigns and of the registered holders of the Warrants.
9.5. Examination of the Warrant
Agreement. A copy of this Agreement shall be available at all
reasonable times at the office of the Warrant Agent in the Borough of Manhattan,
City and State of New York, for inspection by the registered holder of any
Warrant. The Warrant Agent may require any such holder to submit his
Warrant for inspection by it.
9.6. Counterparts. This
Agreement may be executed in any number of original or facsimile counterparts
and each of such counterparts shall for all purposes be deemed to be an
original, and all such counterparts shall together constitute but one and the
same instrument.
9.7. Effect of
Headings. The Section headings herein are for convenience only
and are not part of this Warrant Agreement and shall not affect the
interpretation thereof.
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9.8 Amendments. This
Agreement may be amended by the parties hereto without the consent of any
registered holder for the purpose of curing any ambiguity, or of curing,
correcting or supplementing any defective provision contained herein or adding
or changing any other provisions with respect to matters or questions arising
under this Agreement as the parties may deem necessary or desirable and that the
parties deem shall not adversely affect the interest of the registered
holders. All other modifications or amendments, including any
amendment to increase the Warrant Price or shorten the Exercise Period, shall
require the written consent or vote of the registered holders of a majority of
the then outstanding Warrants. Notwithstanding the foregoing, the
Company may lower the Warrant Price or extend the duration of the Exercise
Period pursuant to Sections 3.1 and 3.2, respectively, without the consent of
the registered holders.
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IN WITNESS WHEREOF, this Agreement has
been duly executed by the parties hereto as of the day and year first above
written.
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By:
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Name:
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Title:
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CONTINENTAL
STOCK TRANSFER
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&
TRUST COMPANY
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By:
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Name:
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Title:
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