Document:

Exhibit 4.3

Exhibit
    4.3

    

    FIRST
      AMENDMENT TO 2004 EQUITY INCENTIVE PLAN

    OF

    SPACEDEV,
      INC.

    

    A
      Colorado Corporation

    

    Pursuant
      to a vote of the shareholders of SpaceDev, Inc., a Colorado corporation (the
      “Company”), taken at the Annual Shareholder Meeting on August 12, 2005, the 2004
      Equity Incentive Plan of the Company is amended as follows:

    

    Section
      5
      of the Company's 2004 Equity Incentive Plan is hereby stricken in its entirety
      and amended to read as follows:

    

    “5. STOCK
      SUBJECT TO THE PLAN.

    

    Subject
      to adjustment as provided in Section 17 hereof, the maximum number of shares
      of
      Common Stock reserved for Awards under the Plan is increased to 4,000,000
      shares. These shares of Common Stock may be either authorized but unissued
      shares or authorized shares previously issued and reacquired by the Company.
      To
      the extent that Options and Stock Awards are granted under the Plan, the shares
      underlying such Awards will be unavailable for any other use including future
      grants under the Plan except that, to the extent that Stock Awards or Options
      terminate, expire, or are forfeited without having been exercised (or in cases
      where a Limited Right has been granted in connection with an Option, the amount
      of such Limited Right received in lieu of the exercise of such Option), new
      Awards may be made with respect to those shares underlying such terminated,
      expired or forfeited Options or Stock Awards.”

    

    CERTIFICATE

    

    I,
      Richard B. Slansky, hereby certify that:

    

    I
      am the
      Secretary of SpaceDev, Inc., a Colorado corporation; and

    

    The
      foregoing Amendment to the Company’s 2004 Equity Incentive Plan is a true and
      correct copy of the Amendment to the Company’s 2004 Equity Incentive Plan
      approved and adopted by the shareholders of SpaceDev, Inc. holding a majority
      of
      all outstanding common stock of the corporation at an annual shareholder meeting
      held August 12, 2005 at 9:00
      p.m.,
      Local Time, at 13855 Stowe Drive, Poway, California.

    

    IN
      WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the
      corporation this 12th day of August 2005.

    

    

    

    /s/
      Richard B. Slansky           

    Richard
      B. Slansky, SecretaryExhibit 4.4

    Exhibit
      4.4

     

    

      

      SECOND
        AMENDMENT TO 2004 EQUITY INCENTIVE PLAN

      OF

      SPACEDEV,
        INC.

      

      A
        Colorado Corporation

      

      Pursuant
        to a vote of the shareholders of SpaceDev, Inc., a Colorado corporation (the
        “Company”), taken at a Special Meeting of Shareholders on January 30, 2006, the
        2004 Equity Incentive Plan of the Company is amended as follows:

      

      Section
        5
        of the Company's 2004 Equity Incentive Plan is hereby stricken in its entirety
        and amended to read as follows:

      

      “5. STOCK
        SUBJECT TO THE PLAN.

      

      Subject
        to adjustment as provided in Section 17 hereof, the maximum number of shares
        of
        Common Stock reserved for Awards under the Plan is increased to 7,000,000
        shares. These shares of Common Stock may be either authorized but unissued
        shares or authorized shares previously issued and reacquired by the Company.
        To
        the extent that Options and Stock Awards are granted under the Plan, the
        shares
        underlying such Awards will be unavailable for any other use including future
        grants under the Plan except that, to the extent that Stock Awards or Options
        terminate, expire, or are forfeited without having been exercised (or in
        cases
        where a Limited Right has been granted in connection with an Option, the
        amount
        of such Limited Right received in lieu of the exercise of such Option), new
        Awards may be made with respect to those shares underlying such terminated,
        expired or forfeited Options or Stock Awards.”

      

      CERTIFICATE

      

      I,
        Richard B. Slansky, hereby certify that:

      

      I
        am the
        Secretary of SpaceDev, Inc., a Colorado corporation; and

      

      The
        foregoing Amendment to the Company’s 2004 Equity Incentive Plan is a true and
        correct copy of the Amendment to the Company’s 2004 Equity Incentive Plan
        approved and adopted by the shareholders of SpaceDev, Inc. holding a majority
        of
        all outstanding common stock of the corporation at a special shareholder
        meeting
        held January 30, 2006 at 9:00
        p.m.,
        Local Time, at 13855 Stowe Drive, Poway, California.

      

      IN
        WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the
        corporation this 30th day of January 2006.

      

      

      

      /s/
        Richard B. Slansky        

      Richard
        B. Slansky, SecretaryExhibit 4.7

 

UNDERWRITER’S PURCHASE OPTION

FOR THE PURCHASE OF 700,000 UNITS

OF

SHERMEN WSC ACQUISITION CORP.

1.             Purchase Option.

THIS CERTIFIES THAT, in consideration of $100 duly paid by CRT Capital
Group LLC (“CRT”), as registered owner of this Purchase Option, to Shermen WSC
Acquisition Corp. (“Company”), CRT is entitled, at any time or from time to
time upon the later of (i) the consummation of a Business Combination and (ii)
[one year from date of prospectus],
2007 (“Commencement Date”), and at or before 5:00 p.m., Eastern Time, [four years from date of prospectus], 2010
(“Expiration Date”), but not thereafter, to subscribe for, purchase and
receive, in whole or in part, up to Seven Hundred Thousand (700,000) units
(“Units”) of the Company, each Unit consisting of one share of common stock of
the Company, par value $0.0001 per share (“Common Stock”), and two warrants
(“Warrant(s)”) expiring four years from the effective date (“Effective Date”)
of the registration statement on Form S-1 (“Registration Statement”) pursuant
to which Units are offered for sale to the public (the “Offering”).  Each Warrant provides for substantially
identical terms as the warrants included in the Units being registered for sale
to the public by way of the Registration Statement (“Public Warrants”), except
that the Warrants have an exercise price of $6.25 per share, [subject to
adjustment as provided in Section 6 hereof]. 
If the Expiration Date is a day on which banking institutions are authorized
by law to close, then this Purchase Option may be exercised on the next
succeeding day which is not such a day in accordance with the terms
herein.  During the period ending on the
Expiration Date, the Company agrees not to take any action that would terminate
the Purchase Option.  This Purchase
Option is initially exercisable at $7.50 per Unit so purchased; provided,
however, that upon the occurrence of any of the events specified in
Section 6 hereof, the rights granted by this Purchase Option, including the
exercise price per Unit and the number of Units (and shares of Common Stock and
Warrants) to be received upon such exercise, shall be adjusted as therein
specified.  The term “Exercise Price”
shall mean the initial exercise price or the adjusted exercise price, depending
on the context.

The term “Holder” shall mean as of any date, CRT and/or any transferee
who acquired the Purchase Option(s) in accordance with Section 3.1 hereof.

2.             Exercise.

2.1.          Exercise Form.  In order to exercise this Purchase Option,
the exercise form attached hereto as Exhibit A must be duly completed,
executed and delivered to the Company, together with this Purchase Option and
payment of the Exercise Price for the Units being purchased payable in cash or
by certified check or official bank check. 
If the subscription rights represented hereby shall not be exercised at
or before 5:00 p.m., Eastern time, on the Expiration

 

 

Date, this
Purchase Option shall become and be void without further force or effect, and
all rights represented hereby shall cease and expire.

2.2.          Legend.  Each certificate for the securities purchased
under this Purchase Option shall bear a legend as follows unless such
securities have been registered under the Securities Act of 1933, as amended
(“Act”):

“THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (“ACT”) OR APPLICABLE STATE LAW.  THE SECURITIES MAY NOT BE OFFERED FOR SALE,
SOLD OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT, OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER
THE ACT AND APPLICABLE STATE LAW.”

2.3.          Cashless Exercise.

2.3.1.       Determination of
Amount.  In lieu of the payment of
the Exercise Price multiplied by the number of Units for which this Purchase
Option is exercisable (and in lieu of being entitled to receive Common Stock
and Warrants) in the manner required by Section 2.1, the Holder shall have the
right (but not the obligation) to convert any exercisable but unexercised
portion of this Purchase Option into Units (“Conversion Right”) as follows:
upon exercise of the Conversion Right, the Company shall deliver to the Holder
(without payment by the Holder of any of the Exercise Price in cash) that
number of shares of Common Stock and Warrants comprising that number of Units
equal to the quotient obtained by dividing (x) the “Value” (as defined below)
of the portion of the Purchase Option being converted by (y) the Current Market
Value (as defined below).  The “Value” of
the portion of the Purchase Option being converted shall equal the remainder
derived from subtracting (a) (i) the Exercise Price multiplied by (ii) the
number of Units underlying the portion of this Purchase Option being converted
from (b) the Current Market Value of a Unit multiplied by the number of Units
underlying the portion of the Purchase Option being converted.  As used herein, the term “Current Market
Value” per Unit at any date means the remainder derived from subtracting (x)
the exercise price of the Warrants multiplied by the number of shares of Common
Stock issuable upon exercise of the Warrants underlying one Unit from (y) (i)
the Current Market Price of the Common Stock multiplied by (ii) the number of
shares of Common Stock underlying one Unit, which shall include the shares of
Common Stock underlying the Warrants included in such Unit.  The “Current Market Price” of a share of
Common Stock shall mean (i) if the Common Stock is listed on a national
securities exchange or quoted on the Nasdaq National Market, Nasdaq SmallCap
Market or NASD OTC Bulletin Board (or successor such as the Bulletin Board
Exchange), the average of the last sale prices of the Common Stock in the
principal trading market for the Common Stock as reported by the exchange,
Nasdaq or the NASD OTC Bulletin Board, as the case may be, for the five trading
days prior to exercise; (ii) if the Common Stock is not listed on a national
securities exchange or quoted on the Nasdaq National Market, Nasdaq SmallCap
Market or the NASD OTC Bulletin Board (or successor such as the Bulletin Board Exchange),
but is traded in the

 

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residual
over-the-counter market, the average closing bid price for the Common Stock for
the five trading days preceding the date in question for which such quotations
are reported by the Pink Sheets, LLC or a similar publisher of such quotations;
and (iii) if the fair market value of the Common Stock cannot be determined
pursuant to clause (i) or (ii) above, such price as the Board of Directors of the
Company shall determine, in good faith.

2.3.2.       Mechanics of
Conversion.  The Conversion Right may
be exercised by the Holder on any business day on or after the Commencement
Date and not later than the Expiration Date by delivering the Purchase Option
and the duly executed exercise form attached hereto with the conversion section
completed to the Company and specifying the total number of Units the Holder
will purchase pursuant to such Conversion Right.

2.3.3.       Warrant Exercise.  Any warrants underlying the Units shall be
issued pursuant to and subject to the terms set forth in the Warrant Agreement
dated as of [_________ __], 2006 (the "Warrant Agreement") between
the Company and Continental Stock Transfer & Trust Company (the
"Warrant Agent"). Without limiting the generality of the foregoing,
the Company shall not be obligated to deliver any shares of Common Stock
pursuant to the exercise of a Warrant underlying the Units and shall have no
obligation to settle a Warrant exercise unless a registration statement under
the Securities Act of 1933, as amended (the “Act”), with respect to the shares
of Common Stock is effective and a current Prospectus is on file with the
Securities and Exchange Commission (the “SEC”). In the event that a
registration statement with respect to the shares of Common Stock underlying a
Warrant is not effective under the Act or a current Prospectus is not on file
with the SEC, the holder of such Warrant shall not be entitled to exercise such
Warrant.  Notwithstanding anything to the
contrary in this Agreement or the Warrant Agreement, under no circumstances
will the Company be required to net cash settle the Warrant exercise.  Warrants may not be exercised by, or shares
of Common Stock issued to, any registered holder in any state in which such
exercise or issuance would be unlawful. 
For the avoidance of doubt, as a result of this Section 2.3.3, any or
all of the Warrants underlying the Units may expire unexercised.  In no event shall the registered Holder of a
Unit or a Warrant be entitled to receive any monetary damages if the shares of
Common Stock underlying the Warrants have not been registered by the Company
pursuant to an effective registration statement or if a current prospectus is
available for delivery by the Warrant Agent, provided the Company has fulfilled
its obligation to use its best efforts to effect such registration and ensure a
current prospectus is available for delivery by the Warrant Agent, as provided
in the Warrant Agreement.

2.4           Limitation.  In no circumstances will the Company be
required to settle this Purchase Option exercise for cash.

3.             Transfer.

3.1.          General
Restrictions.  The registered Holder
of this Purchase Option, by its acceptance hereof, agrees that it will not
directly or indirectly sell, offer, contract or grant any option to sell
(including without limitation any short sale), transfer, assign, pledge,
hypothecate, establish an open “put equivalent position,” liquidate or decrease
a “call equivalent position” within the meaning of Rule 16a-1(h) under the
Securities Exchange Act of 1934, as amended, or otherwise dispose of, or enter
into any transaction which is designed to, or might reasonably be expected to,
result in the disposition of (“Transfer”) this Purchase Option for a period of
one year following the Effective Date to anyone other than (i) CRT or a
selected dealer participating in the Offering, or (ii) a bona fide officer or
partner of CRT or a selected dealer.  On
and after the first anniversary of the Effective Date, Transfers of this Purchase
Option 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 as Exhibit B, 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 of its receipt of such
assignment, transfer this Purchase Option on the books of the Company and shall
execute and deliver a new Purchase Option or Purchase Options of like tenor to
the appropriate assignee(s) expressly evidencing the right to purchase the
aggregate number of Units purchasable hereunder or such portion of such number
as shall be contemplated by any such assignment.

3.2.          Restrictions
Imposed by the Act.  The securities
evidenced by this Purchase Option shall not be transferred unless and until (i)
the Company has received either (A) 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 Bingham McCutchen LLP shall be deemed
satisfactory evidence of the availability of an exemption), or (B) such other
evidence as the Company may request and that the Holder agrees to provide in
lieu of such opinion; or (ii) a registration statement or a post-effective
amendment to the Registration Statement relating to

 

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such securities
has been filed by the Company and declared effective by the SEC and compliance
with applicable state securities law has been established.

4.             New Purchase Options to be Issued

4.1.          Partial Exercise
or Transfer.  Subject to the
restrictions in Section 3 hereof, this Purchase Option may be exercised or
assigned in whole or in part.  In the
event of the exercise or assignment hereof in part only, upon surrender of this
Purchase Option for cancellation, together with the duly executed exercise or
assignment form and funds sufficient to pay any Exercise Price (except to the
extent the Holder elects to exercise this Purchase Option by means of a
cashless exercise as provided by Section 2.3) and/or transfer tax, the Company
shall cause to be delivered to the Holder without charge a new Purchase Option
of like tenor to this Purchase Option in the name of the Holder evidencing the right
of the Holder to purchase the number of Units purchasable hereunder as to which
this Purchase Option has not been exercised or assigned.

4.2.          Lost Certificate.  Upon receipt by the Company of evidence
satisfactory to it of the loss, theft, destruction or mutilation of this
Purchase Option and of reasonably satisfactory indemnification or the posting
of a bond, the Company shall execute and deliver a new Purchase Option of like
tenor and date.  Any such new Purchase
Option executed and delivered as a result of such loss, theft, mutilation or
destruction shall constitute a substitute contractual obligation on the part of
the Company.

5.             Registration Rights.

5.1.          “Piggy-Back” Registration.

5.1.1.       Grant of Right.  The Holders of the Purchase Options shall have
the right for a period of seven years commencing on the Effective Date, to
include the Purchase Options, including the Units, Common Stock, the Warrants
and the Common Stock underlying the Warrants (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 (a “Piggy-Back Registration”).  The Company shall cause such Registrable
Securities to be included in such registration and shall use its commercially
reasonable efforts to cause the managing underwriter or underwriters of a
proposed underwritten offering to permit the Registrable Securities requested
to be included in a Piggy-Back Registration on the same terms and conditions as
any similar securities of the Company and to permit the sale or other
disposition of such Registrable Securities in accordance with the intended
method(s) of distribution thereof.  All
holders of Registrable Securities proposing to distribute their securities
through a Piggy-Back Registration that involves an underwriter or underwriters
shall enter into an underwriting agreement in customary form with the
underwriter or underwriters selected for such Piggy-Back Registration.

5.1.2.       Reduction of
Offering.  If the managing
underwriter or underwriters for a Piggy-Back Registration that is to be an
underwritten offering advises the Company and the Holders in writing that the
dollar amount or number of shares of Common Stock which the

 

4

 

Company desires to
sell, taken together with shares of Common Stock, if any, as to which
registration has been demanded pursuant to written contractual arrangements
with persons other than the Holders of Registrable Securities hereunder, the
Registrable Securities as to which registration has been requested under this
Section 5.1, and the shares of Common Stock, if any, as to which
registration has been requested pursuant to the written contractual piggy-back
registration rights of other shareholders of the Company, exceeds the maximum
dollar amount or maximum number of shares that can be sold in such offering
without adversely affecting the proposed offering price, the timing, the
distribution method, or the probability of success of such offering (such
maximum dollar amount or maximum number of shares, as applicable, the “Maximum
Number of Shares”), then the Company shall include in any such registration.

(a)           If
the registration is undertaken for the Company’s account: (i) first, the
shares of Common Stock or other securities that the Company desires to sell
that can be sold without exceeding the Maximum Number of Shares;
(ii) second, to the extent that the Maximum Number of Shares has not been
reached under the foregoing clause (i), the shares of Common Stock or other
securities, if any, comprised of Registrable Securities and the shares of
Common Stock or other securities registrable pursuant to the terms of the
Registration Rights Agreement between the Company and the initial investors in
the Company, dated as of
[                 ],
2006 (the “Registration Agreement” and such registrable securities, the “Investor
Securities”), as to which registration has been requested pursuant to the
applicable written contractual piggy-back registration rights of such security
holders, (pro rata in accordance with the number
of shares that each such security holder has requested be included in such
registration, regardless of the number of shares held by each such security
holder (such proportion is referred to hereto as “Pro Rata”)), that can be sold
without exceeding the Maximum Number of Shares; and (iii) third, to the
extent that the Maximum Number of shares has not been reached under the
foregoing clauses (i) and (ii), the shares of Common Stock or other
securities for the account of other persons that the Company is obligated to
register pursuant to written contractual piggy-back registration rights held by
other shareholders of the Company that can be sold without exceeding the
Maximum Number of Shares;

(b)           If
the registration is a “demand” registration undertaken at the demand of holders
of Investor Securities: (i) first, the shares of Common Stock or other
securities for the account of the demanding persons, Pro Rata, that can be sold
without exceeding the Maximum Number of Shares; (ii) second, to the extent
that the Maximum Number of Shares has not been reached under the foregoing
clause (i), the shares of Common Stock or other securities that the Company
desires to sell, that can be sold without exceeding the Maximum Number of
Shares; (iii) third, to the extent that the Maximum Number of Shares has
not been reached under the foregoing clause (i) and (ii), the Registrable
Securities as to which registration has been requested under this Section 5.2,
Pro Rata; and (iv) fourth, to the extent that the Maximum Number of Shares
has not been reached under the foregoing clauses (i), (ii) and (iii), the
shares of Common Stock or other securities for the account of other persons
that the Company is obligated to register pursuant to written contractual
piggy-back registration rights held by other shareholders of the Company that
can be sold without exceeding the Maximum Number of Shares; and

(c)           If
the registration is a “demand” registration undertaken at the demand of persons
other than the holders of Investor Securities: (i) first, the shares of
Common Stock or other securities for the account of the demanding persons that
can be sold without exceeding the Maximum Number of Shares; (ii) second,
to the extent that the Maximum Number of Shares has not been reached under the
foregoing clause (i), the shares of Common Stock or other securities that the
Company desires to sell and the shares of Common Stock or other securities
comprised of Registrable Securities and Investor Securities as to which
registration has been requested pursuant to the terms hereof and of the
Registration Rights Agreement (as applicable), Pro Rata, that can be sold
without exceeding the Maximum Number of Shares; and (iii) third, to the
extent that the Maximum Number of Shares has not been reached

 

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under the foregoing clauses (i) and (ii), the shares of Common Stock or
other securities for the account of other persons that the Company is obligated
to register pursuant to written contractual piggy-back registration rights held
by other shareholders of the Company that can be sold without exceeding the
Maximum Number of Shares.

5.1.3.       Terms.  The Company shall bear all fees and expenses
attendant to registering the Registrable Securities, including the reasonable
expenses of any one legal counsel selected by the Holders to represent them in
connection with the sale of the Registrable Securities, but the Holders shall
pay any and all underwriting commissions related to 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 fifteen days written
notice prior to the proposed date of filing of such registration
statement.  Such notice to the Holders
shall continue to be given for each applicable registration statement filed
(until the fifth anniversary of the Effective Date) by the Company until such
time as all of the Registrable Securities have been registered and sold.  The holders of the Registrable Securities
shall exercise the “piggy-back” rights provided for herein by giving written
notice, within ten days of the receipt of the Company’s notice of its intention
to file a registration statement.  The
Company shall cause any registration statement filed pursuant to the above
“piggyback” rights to remain effective for at least nine months from the date
that the Holders of the Registrable Securities are first given the opportunity
to sell all of such securities.

5.2.          Suspension of Use
of Effective Registration Statement. 
If a registration  statement
relating to the registration of Registrable Securities under this
Section 5 hereof has been declared effective (“Effective Registration
Statement”), subject to the good faith determination by the Board of Directors
of the Company that it is reasonably necessary to suspend the use of such
Effective Registration Statement or sales of Registrable Securities by Holders
under such Effective Registration Statement, the Company may, upon written
notice (the “Suspension Notice”) to the Holders, direct the Holders to suspend
the use of or sales under such Effective Registration Statement for a period not
to exceed thirty (30) days in any three (3) month period or ninety (90) days in
the aggregate in any twelve (12) month period, if any of the following events
(each, a “Suspension Event”) shall occur: negotiations relating to, or the
consummation of, a transaction or the occurrence of an event, in each case,
that (i) would require additional disclosure of material information by
the Company in such Effective Registration Statement or other public filings
and which has not been so disclosed, and (ii) either (x) as to which
the Company has a bona fide business purpose for preserving confidentiality, or
(y) that renders the Company unable to comply with SEC requirements, or
(z) that would make it unduly burdensome to promptly amend or supplement
such Effective Registration Statement on a post-effective basis, as
applicable.  Upon the occurrence of any
such Suspension Event, the Company shall use its reasonable best efforts to
take or cause to be taken such action as is necessary to permit resumed use of
such Effective Registration Statement promptly following the cessation of the
Suspension Event giving rise to such suspension so as to permit the Holders to
resume use of and sales under such Effective Registration Statement as soon as
practicable thereafter.  Upon cessation
of the Suspension Event giving rise to such suspension, the Company shall
provide the Holders with prompt written notice that the Suspension Event has
ceased (the “End of Suspension Notice”). 
The Holders shall not effect any sales of the Registrable Securities
pursuant to such Effective Registration Statement at any time after it has
received a Suspension

 

6

 

Notice from the
Company and prior to the receipt of an End of Suspension Notice (the “Suspension
Period”).  The Company shall extend the
effectiveness period of any registration statement by the number of days of the
Suspension Period, provided there are Registrable Securities registered
thereunder that have not been sold.

5.3.          General Terms.

5.3.1.       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
litigation, commenced or threatened, or any claim whatsoever whether arising
out of any action between the underwriter and the Company or between the
underwriter and any third party or otherwise) to which any of them may become
subject under the Act, the Exchange Act or otherwise, arising from such
registration statement but only to the same extent and with the same effect as
the provisions pursuant to which the Company has agreed to indemnify the
underwriters contained in Section 5 of the Underwriting Agreement (the
“Underwriting Agreement”) between the Company and CRT dated the Effective
Date.  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, its officers and directors and each person, if any, who controls the
Company within the meaning of Section 15 of the Act or Section 20(a) of the
Exchange Act, against all loss, claim, damage, expense or liability (including
all reasonable attorneys’ fees and other expenses reasonably incurred in
investigating, preparing or defending against any claim whatsoever) to which
they may become subject under the Act, the Exchange Act or otherwise, arising
from information furnished by or on behalf of such Holders, or their successors
or assigns, in writing, for specific inclusion in such registration statement
to the same extent and with the same effect as the provisions contained in
Section 5 of the Underwriting Agreement.

5.3.2.       Exercise of
Purchase Options.  Nothing contained
in this Purchase Option shall be construed as requiring the Holder(s) to
exercise their Purchase Options or Warrants underlying such Purchase Options
prior to or after the initial filing of any registration statement or the
effectiveness thereof.

5.3.3.       Documents
Delivered to Holders.  The Company
shall furnish CRT, as representative of the Holders participating in any of the
foregoing offerings, a signed counterpart, addressed to the participating
Holders, of (i) an opinion of counsel to the Company, dated the effective date
of such registration statement (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’

 

7

 

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
CRT, as representative of the Holders participating in the offering, the
correspondence and memoranda described below and copies of all correspondence
between the SEC or its staff and the Company, its counsel or auditors and
permit CRT, as representative of the Holders, to do such investigation, upon
reasonable advance notice, with respect to information contained in or omitted from
the registration statement as it deems reasonably necessary to comply with
applicable securities laws or rules of the NASD.  Such investigation shall include access to
books, records and properties and opportunities to discuss the business of the
Company with its officers and independent auditors, all to such reasonable
extent and at such reasonable times as CRT, as representative of the Holders,
shall reasonably request.  The Company
shall not be required to disclose any confidential information or other records
to CRT, as representative of the Holders, or to any other person, unless and
until such persons shall have entered into reasonable confidentiality
agreements (in form and substance reasonably satisfactory to the Company), with
the Company with respect thereto.

5.3.4.       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 5, which managing underwriter shall be reasonably
acceptable to the Company.  Such
agreement shall be reasonably satisfactory in form and substance to the
Company, each Holder and such managing underwriters, and shall contain such
representations, warranties and covenants by the Company and such other terms
as are customarily contained in agreements of that type used by the managing
underwriter.  The Holders shall be
parties to any underwriting agreement relating to an underwritten sale of their
Registrable Securities and may, at their option, require that any or all of 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,
information regarding such Holders and their intended methods of
distribution.  Such Holders, however,
shall agree to such covenants and indemnification and contribution obligations
for selling shareholders as are customarily contained in agreements of that
type used by the managing underwriter. 
Further, such Holders shall execute appropriate powers of attorney and
custody agreements as the underwriters shall reasonably determine are necessary
in connection with the offering and otherwise cooperate fully in the
preparation of the registration statement and other documents relating to any
offering in which they include securities pursuant to this Section 5.  Each Holder shall also furnish to the Company
such information regarding itself, the Registrable Securities held by it, and
the intended method of disposition of such securities as shall be reasonably
required to effect the registration of the Registrable Securities.

5.3.5.       Rule 144 Sale.  Notwithstanding anything contained in this
Section 5 to the contrary, the Company shall have no obligation pursuant to
Section 5.1 for the registration of Registrable Securities held by any Holder
(i) where such Holder would then be entitled to sell under Rule 144 promulgated
under the Act (“Rule 144”) within any three-month period (or such other period
prescribed under Rule 144 as may be provided by amendment thereof) all of the

 

8

 

Registrable
Securities then held by such Holder, and (ii) where the number of Registrable
Securities held by such Holder is within the volume limitations under paragraph
(e) of Rule 144 (calculated as if such Holder were an affiliate within the
meaning of Rule 144).

5.3.6.       Supplemental
Prospectus.  Each Holder agrees, that
upon receipt of any notice from the Company of the happening of any event as a
result of which the prospectus included in the Registration Statement, as then
in effect, includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances then existing, such Holder
will immediately discontinue disposition of Registrable Securities pursuant to
the Registration Statement covering such Registrable Securities until such
Holder’s receipt of the copies of a supplemental or amended prospectus, and, if
so desired by the Company, such Holder shall deliver to the Company (at the
expense of the Company) or destroy (and deliver to the Company a certificate of
such destruction) all copies, other than permanent file copies then in such
Holder’s possession, of the prospectus covering such Registrable Securities
current at the time of receipt of such notice.

5.3.7.       Holder Obligations.  No Holder may participate in any underwritten
offering pursuant to this Section 5 unless such Holder (i) agrees to sell only
the Holder’s Registrable Securities on the basis reasonably provided in any
underwriting agreement, and (ii) completes, executes and delivers any and all
questionnaires, powers of attorney, custody agreements, indemnities,
underwriting agreements and other documents reasonably and customarily required
by or under the terms of any underwriting agreement.

6.             Adjustments.

6.1.          Adjustments to
Exercise Price and Number of Securities. 
The Exercise Price and the number of Units underlying the Purchase
Option shall be subject to adjustment from time to time as hereinafter set
forth:

6.1.1.       Stock Dividends -
Split-Ups.  If after the date hereof,
and subject to the provisions of Section 6.4 below, the number of outstanding
shares of Common Stock is increased by a stock dividend payable in shares of
Common Stock or by a split-up of shares of Common Stock or other similar event,
then, on the effective date thereof, the number of shares of Common Stock
underlying each of the Units purchasable hereunder shall be increased in
proportion to such increase in outstanding shares.  In such case, the number of shares of Common
Stock, and the exercise price applicable thereto, underlying the Warrants
underlying each of the Units purchasable hereunder shall be adjusted in
accordance with the terms of the Warrants. 
For example, if the Company declares a two-for-one stock dividend and at
the time of such dividend this Purchase Option is for the purchase of one Unit
at $7.50 per whole Unit (the Warrants underlying the Units are exercisable for
$6.25 per share), upon effectiveness of the dividend, this Purchase Option will
be adjusted to allow for the purchase of one Unit at $7.50 per Unit, each Unit
entitling the holder to receive two shares of Common Stock and two Warrants
(each Warrant exercisable for two shares of Common Stock at $3.13 per share).

6.1.2.       Aggregation of
Shares.  If after the date hereof,
and subject to the provisions of Section 6.4, the number of outstanding shares
of Common Stock is decreased by a

 

9

 

consolidation,
combination or reclassification of shares of Common Stock or other similar
event, then, on the effective date thereof, the number of shares of Common
Stock underlying each of the Units purchasable hereunder shall be decreased in
proportion to such decrease in outstanding shares.  In such case, the number of shares of Common
Stock, and the exercise price applicable thereto, underlying the Warrants
underlying each of the Units purchasable hereunder shall be adjusted in
accordance with the terms of the Warrants.

6.1.3.       Replacement of
Securities upon Reorganization, etc. 
In case of any reclassification or reorganization of the outstanding
shares of Common Stock other than a change covered by Section 6.1.1 or 6.1.2
hereof or that solely affects the par value of such shares of Common Stock, or
in the case of any merger or consolidation of the Company with or into another
corporation (other than a consolidation or merger in which the Company is the
continuing corporation and that does not result in any reclassification or
reorganization of the outstanding shares of Common Stock), or in the case of
any sale or conveyance to another corporation or entity of the property of the
Company as an entirety or substantially as an entirety in connection with which
the Company is dissolved, the Holder of this Purchase Option shall have the
right thereafter (until the expiration of the right of exercise of this
Purchase Option) to receive upon the exercise hereof, for the same aggregate
Exercise Price payable hereunder immediately prior to such event, the kind and
amount of shares of stock or other securities or property (including cash)
receivable upon such reclassification, reorganization, merger or consolidation,
or upon a dissolution following any such sale or transfer, by a Holder of the
number of shares of Common Stock of the Company obtainable upon exercise of
this Purchase Option and the underlying Warrants immediately prior to such
event; and if any reclassification also results in a change in shares of Common
Stock covered by Section 6.1.1 or 6.1.2, then such adjustment shall be made
pursuant to Sections 6.1.1, 6.1.2 and this Section 6.1.3.  The provisions of this Section 6.1.3 shall
similarly apply to successive reclassifications, reorganizations, mergers or
consolidations, sales or other transfers.

6.1.4.       Changes in Form of
Purchase Option.  This form of
Purchase Option need not be changed because of any change pursuant to this
Section, and Purchase Options issued after such change may state the same Exercise
Price and the same number of Units as are stated in the Purchase Options
initially issued pursuant to this Agreement. 
The acceptance by any Holder of the issuance of new Purchase Options
reflecting a required or permissive change shall not be deemed to waive any
rights to an adjustment occurring after the Commencement Date or the
computation thereof.

6.2.          Substitute
Purchase Option.  In case of any
consolidation of the Company with, or merger of the Company with, or merger of
the Company into, another corporation (other than a consolidation or merger
which does not result in any reclassification or change of the outstanding
Common Stock), the corporation formed by such consolidation or merger shall
execute and deliver to the Holder a supplemental Purchase Option providing that
the holder of each Purchase Option then outstanding or to be outstanding shall
have the right thereafter (until the stated expiration of such Purchase Option)
to receive, upon exercise of such Purchase Option, the kind and amount of
shares of stock and other securities and property receivable upon such
consolidation or merger, by a holder of the number of shares of Common Stock of
the Company for which such Purchase Option might have been exercised
immediately prior to such

 

10

 

consolidation,
merger, sale or transfer.  Such
supplemental Purchase Option shall provide for adjustments which shall be
identical to the adjustments provided in Section 6.  The above provision of this Section shall
similarly apply to successive consolidations or mergers.

6.3.          Elimination of
Fractional Interests.  The Company
shall not be required to issue certificates representing fractions of shares of
Common Stock or Warrants upon the exercise of the Purchase Option, nor shall it
be required to issue scrip or pay cash in lieu of any fractional interests, it
being the intent of the parties that all fractional interests shall be
eliminated by rounding any fraction up to the nearest whole number of Warrants,
shares of Common Stock or other securities, properties or rights.

7.             Reservation and Listing.

The Company shall at all times reserve and keep available out of its
authorized shares of Common Stock, solely for the purpose of issuance upon
exercise of the Purchase Option or the Warrants underlying the Purchase Option,
such number of shares of Common Stock or other securities, properties or rights
as shall be issuable upon the exercise thereof. 
The Company covenants and agrees that, upon exercise of the Purchase
Option and payment of the Exercise Price therefor, all shares of Common Stock
and other securities issuable upon such exercise shall be duly and validly
issued, fully paid and non-assessable and not subject to preemptive rights of
any shareholder.  The Company further
covenants and agrees that upon exercise of the Warrants underlying the Purchase
Option and payment of the respective Warrant exercise price therefor, all
shares of Common Stock and other securities issuable upon such exercise shall
be duly and validly issued, fully paid and non-assessable and not subject to
preemptive rights of any shareholder.  As
long as the Purchase Option shall be outstanding, the Company shall use its
commercially reasonable efforts to cause all (i) Units and shares of Common
Stock issuable upon exercise of the Purchase Option, (ii) Warrants issuable
upon exercise of the Purchase Option and (iii) shares of Common Stock issuable
upon exercise of the Warrants included in the Units issuable upon exercise of
the Purchase Option to be listed (subject to official notice of issuance) on
the securities exchanges (or, if applicable on the Nasdaq National Market,
SmallCap Market, OTC Bulletin Board or any successor trading market) on which
the Units, the Common Stock or the Public Warrants issued to the public in
connection with 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 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 Option 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

 

11

 

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.

8.2.          Events Requiring
Notice.  The Company shall be
required to give the notice described in this Section 8 upon one or more of the
following events: (i) if the Company shall take a record of the holders of its
shares of Common Stock for the purpose of entitling them to receive a dividend
or distribution payable otherwise than in cash, or a cash dividend or
distribution payable otherwise than out of retained earnings, as indicated by
the accounting treatment of such dividend or distribution on the books of the
Company, or (ii) the Company shall offer to all the holders of its Common Stock
any additional shares of capital stock of the Company or securities convertible
into or exchangeable for shares of capital stock of the Company, or any option,
right or warrant to subscribe therefor, or (iii) a dissolution, liquidation or
winding up of the Company (other than in connection with a consolidation or
merger) or a sale of all or substantially all of its property, assets and
business shall be proposed.

8.3.          Notice of Change
in Exercise Price.  The Company
shall, promptly after an event requiring a change in the Exercise Price
pursuant to Section 6 hereof, send notice to the Holders of such event and
change (“Price Notice”).  The Price
Notice shall describe the event causing the change and the method of
calculating same and shall be certified as being true and accurate by the
Company’s Chief Executive Officer and 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 the following address or to
such other address as the Company may designate by notice to the Holders:

Sherman WSC Acquisition
Corp.

c/o The Sherman Group

1251 Avenue of the Americas

Suite 900

New York, NY 10020

Attn:  Francis P. Jenkins, Jr.

Fax No.:  (212) 300-0200

9.             Miscellaneous.

9.1.          Amendments.  The Company and CRT 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 CRT may deem necessary or
desirable and that the Company and CRT deem 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.

 

12

 

9.2.          Headings.  The headings contained herein are for the
sole purpose of convenience of reference, and shall not in any way limit or
affect the meaning or interpretation of any of the terms or provisions of this
Purchase Option.

10.           Entire Agreement.

This Purchase Option (together with the other agreements and documents
being delivered pursuant to or in connection with this Purchase Option)
constitutes the entire agreement of the parties hereto with respect to the
subject matter hereof, and supersedes all prior agreements and understandings
of the parties, oral and written, with respect to the subject matter hereof.

10.1.        Binding Effect.  This Purchase Option shall inure solely to
the benefit of and shall be binding upon, the Holder and the Company and their
permitted assignees, respective successors, legal representative and assigns,
and no other person shall have or be construed to have any legal or equitable
right, remedy or claim under or in respect of or by virtue of this Purchase
Option or any provisions herein contained.

10.2.        Governing Law;
Submission to Jurisdiction.  This
Purchase Option shall be governed by and construed and enforced in accordance
with the laws of the State of New York 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 of America 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.

10.3.        Waiver.  The failure of the Company or the Holder to
at any time enforce any of the provisions of this Purchase Option shall not be
deemed or construed to be a waiver of any such provision, nor to in any way
affect the validity of this Purchase Option or any provision hereof or the
right of the Company or any Holder to thereafter enforce each and every
provision of this Purchase Option.  No
waiver of any breach, non-compliance or non-fulfillment of any of the
provisions of this Purchase Option shall be effective unless set forth in a
written instrument executed by the party or parties against whom or which
enforcement of such waiver is sought; and no waiver of any such breach,
non-compliance or non-fulfillment shall be construed or deemed to be a waiver
of any other or subsequent breach, non-compliance or non-fulfillment.

10.4.        Execution in
Counterparts.  This Purchase Option
may be executed in one or more counterparts, and by the different parties
hereto in separate counterparts, each of which shall be deemed to be an
original, but all of which taken together shall constitute one and the same

 

13

 

agreement, and
shall become effective when one or more counterparts has been signed by each of
the parties hereto and delivered to each of the other parties hereto.

10.5.        Exchange Agreement.  As a condition of the Holder’s receipt and
acceptance of this Purchase Option, Holder agrees that, at any time prior to
the complete exercise of this Purchase Option by Holder, if the Company and CRT
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.

[Signature page follows]

 

14

 

IN WITNESS WHEREOF, the Company has caused this Purchase Option to be
signed by its duly authorized officer as of the ___ day of ________, 2006.

	
   

  	
  SHERMEN WSC ACQUISITION CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  

 

15

 

Exhibit A

Form
to be used to exercise Purchase Option:

Shermen
WSC Acquisition Corp.

c/o The Sherman Group

1251 Avenue of the Americas,

Suite 900

New York, NY 10020

Date:
                         

The undersigned hereby elects irrevocably to exercise all or a portion
of the within Purchase Option and to purchase               
Units of Shermen WSC Acquisition Corp. and hereby makes payment of $            
(at the rate of $          
per Unit) in payment of the Exercise Price pursuant thereto.  Please issue the Common Stock and Warrants as
to which this Purchase Option is exercised in accordance with the instructions
given below.

or

The undersigned hereby elects irrevocably to convert its right to
purchase            
Units purchasable under the within Purchase Option by surrender of the
unexercised portion of the attached Purchase Option (with a “Value” based of $           
based on a “Market Price” of $          ).  Please issue the securities comprising the
Units as to which this Purchase Option is exercised in accordance with the
instructions given below.

	
   

  	
   

  
	
   

  	
  Signature

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature Guaranteed

  

 

INSTRUCTIONS
FOR REGISTRATION OF SECURITIES

 

 

 

	
  Name

  	
   

  	
   

  
	
  (Print
  in Block Letters)

  
	
   

  
	
  Address

  	
   

  
	
   

  
	
   

  
				

 

Ex.
A-1

 

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.

 

Ex. A-2

 

Exhibit B

Form
to be used to assign Purchase Option:

ASSIGNMENT

(To
be executed by the registered Holder to effect a transfer of the within
Purchase Option):

FOR VALUE RECEIVED,                                        
does hereby sell, assign and transfer unto                                  
the right to purchase                 
Units of Shermen WSC Acquisition Corp. (“Company”) evidenced by the within
Purchase Option and does hereby authorize the Company to transfer such right on
the books of the Company.

Dated:
                          
, 20      

	
   

  	
   

  
	
   

  	
  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.

 

Ex. B-1

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