Document:

WARRANT AGREEMENT 

 Agreement made as of ________, 2007 between
  Highlands Acquisition Corp., a Delaware corporation, with offices at One
  Paragon Drive, Suite 125, Montvale, New Jersey 07645 (“Company”), and
  Continental Stock Transfer & Trust Company, a New York corporation, with
  offices at 17 Battery Place, New York, New York 10004 (“Warrant
  Agent”). 

 WHEREAS, the Company has engaged in a
  private offering of units (“Units”), each consisting of one share of
  common stock, par value $0.0001 per share, of the Company (“Common
  Stock”) and one warrant to purchase one share of Common Stock for $7.50,
  subject to adjustment as described herein, to its initial stockholders (each a
  “Founder” and collectively, the “Founders”) and has issued
  and delivered an aggregate of 2,500,000 warrants (the “Founders’
  Warrants”) to be included in the Units issued to the Founders; and 

 WHEREAS, the Company may engage in an
  initial public offering (“Initial Public Offering”) of Units and, in
  connection therewith, may issue and deliver up to 11,500,000 underlying
  warrants to the public investors (“Public Warrants”), each of such
  Public Warrants evidencing the right of the holder thereof to purchase one
  share of Common Stock for $7.50, subject to adjustment as described herein;
  and 

 WHEREAS, if the Company determines to engage
  in an Initial Public Offering, the Company will file with the Securities and
  Exchange Commission a Registration Statement on Form S-1 (“Registration
  Statement”) for the registration under the Securities Act of 1933, as
  amended (“Act”) of, among other securities, the Units, the Common
  Stock and the Public Warrants; and 

 WHEREAS, if the Company engages in and
  consummates an Initial Public Offering, the Company will simultaneously
  therewith engage in a private offering of Warrants to Kanders & Company,
  Robert W. Pangia, Ivy Healthcare Capital II, L.P., Dennis W. O'Dowd, Virgilio
  Rene Veloso and Fieldpoint Capital LLC (each a “Sponsor” and
  collectively, the “Sponsors”) and, in connection therewith, has
  entered into agreements to sell an aggregate of 3,250,000 additional warrants
  for $1.00 per warrant, each evidencing the right of the holder thereof to
  purchase one share of the Company’s Common Stock for $7.50, subject to
  adjustment as described herein (the “Sponsors’ Warrants”);
  and 

 WHEREAS, if the Company engages in and
  consummates an Initial Public Offering and subsequently consummates a merger,
  capital stock exchange, asset acquisition, stock purchase, reorganization or
  other similar business combination (“Business Combination”), the
  Company will 

   

   

 

 immediately prior to such Business
  Combination engage in a private offering of Units to Kanders & Company,
  Robert W. Pangia, Ivy Healthcare Capital II, L.P., Dennis W. O'Dowd, Virgilio
  Rene Veloso and Fieldpoint Capital LLC (each a “Co-Investment
  Purchaser” and collectively, the “Co-Investment Purchasers”)
  and, in connection therewith, has entered into agreements to sell an aggregate
  of 1,000,000 co-investment units, consisting of one share of Common Stock and
  one Warrant evidencing the right of the holder thereof to purchase one share of
  the Company’s Common Stock for $7.50, subject to adjustment as described
  herein, for $10.00 per unit (the “Co-Investment Warrants” and
  together with the Founders’ Warrants and the Sponsors’ Warrants, the
  “Private Warrants”); and 

 WHEREAS, if the Company engages in and
  consummates an Initial Public Offering, the Sponsors would pay for, and the
  Company would issue and deliver, the Sponsors’ Warrants simultaneously
  with the consummation of the Initial Public Offering; and 

 WHEREAS, if the Company engages in and
  consummates an Initial Public Offering and subsequently consummates a Business
  Combination, the Co-Investment Purchasers would pay for, and the Company would
  issue and deliver, the Co-Investment Warrants immediately prior to the
  consummation of the Business Combination; and 

 WHEREAS, the Public Warrants and the Private
  Warrants are sometimes collectively referred to herein as 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: 

   

   

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 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. 

 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. 

   

   

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 2.4. Detachability of Warrants. The securities comprising the Units will not be
  separately transferable until 45 days after the date hereof unless Citigroup
  Global Markets Inc. informs the Company of its decision to allow earlier
  separate trading, but in no event will Citigroup Global Markets Inc. allow
  separate trading of the securities comprising the Units 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
  Underwriter’s over-allotment option, if the over-allotment option is
  exercised prior to the filing of the Form 8-K.  

 2.5 Founders’ Warrants. The Founders’ Warrants will be issued in the same
  form as the Public Warrants but they (i) will not be transferable or salable
  (subject to limited exceptions) until one year after the Company completes a
  Business Combination as more fully described in the Escrow Agreement, dated
  _______, 2007, by and between the Company, the Founders and Continental Stock
  Transfer & Trust Company (the “Escrow Agreement”), (ii) will be
  non-redeemable by the Company so long as they are held by the Founders or their
  permitted transferees (as described in the Escrow Agreement) and (iii) will
  become exercisable after the Company completes a Business Combination if and
  when the last sales price of the Common Stock exceeds $14.25 per share (subject
  to adjustments provided in Section 4 hereof and in the last sentence of Section
  3.1) for any 20 trading days within a 30-trading day period beginning 90 days
  after the completion of the Business Combination, provided that the Founders' Warrants will in no event be exercisable prior to ____________, 2008. 

 2.6 Sponsors’ Warrants. The Sponsors’ Warrants will be issued in the same
  form as the Public Warrants but they (i) will not be transferable or salable
  (subject to limited exceptions) until after the Company completes a Business
  Combination as more fully described in each of the Subscription Agreements,
  dated as of May 31, 2007, by and between each Sponsor and the Company, Graubard
  Miller and Citigroup Global Markets Inc. (the “Sponsor Subscription
  Agreements”) and (ii) will be non-redeemable by the Company so long as
  they are held by the Sponsors or their permitted transferees (as described in
  the Sponsor Subscription Agreements). 

 2.7 Co-Investment Warrants. The Co-Investment Warrants will be issued in the same
  form as the Public Warrants but they will not be transferable or salable
  (subject to limited exceptions) until one year after the Company completes a
  Business Combination as more fully described in each of the Subscription
  Agreements, dated as of May 31, 2007, by and between each Co-Investment
  Purchaser and the Company, Graubard Miller and Citigroup Global Markets
  Inc. 

   

   

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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 shares of
  Common Stock stated therein, at the price of $7.50 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 Common Stock 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. Except with respect to the Founders’ Warrants as
  described above in Section 2.5, each Warrant may be exercised only during the
  period (“Exercise Period”) commencing on the later of (i) the
  consummation by the Company of a Business Combination and (ii) _________, 2008,
  and terminating at 5:00 p.m., New York City time on the earlier to occur of
  (i) ________, 2012 or (ii) the date fixed for redemption of the
  Warrants as provided in Section 6 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.  

 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 in lawful money of the United States, in
  cash, good certified check or good bank draft payable to the order of the
  Company (or as otherwise agreed to by the Company), the Warrant Price for each
  full share of Common Stock as to which the  

   

   

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 Warrant is exercised and any and all
  applicable taxes due in connection with the exercise of the Warrant, the
  exchange of the Warrant for Common Stock and the issuance of the Common Stock;
  provided, however, that the Warrant shall not be exercisable and the Company
  shall not be obligated to issue Common Stock unless, at the time a holders
  seeks to exercise the Warrant, a prospectus relating to the Common Stock
  issuable upon exercise of the Warrant is current and the Common Stock has been
  registered or qualified or deemed to be exempt under the securities laws of the
  state of residence of the holder of the Warrant. 

 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, the
  Company shall issue to the registered holder of such Warrant a certificate or
  certificates for the number of full shares of Common Stock 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. Subject to Section 7.4 and notwithstanding the
  foregoing, the Company shall not be obligated to deliver any securities
  pursuant to the exercise of a Warrant and shall have no obligation to settle
  such Warrant exercise unless a registration statement under the Act with
  respect to the Common Stock is effective and such securities are qualified for
  sale or exempt from qualification under applicable securities laws of the
  states or other jurisdictions in which the registered holders reside. In the
  event that a registration statement with respect to the Common Stock underlying
  a Warrant is not effective under the Act, the holder of such Warrant shall not
  be entitled to exercise such Warrant and such Warrant may have no value and
  expire worthless. 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. In the event that a registration statement is not effective for the
  exercised Warrants, the purchaser of a unit containing such Warrant, will have
  paid the full purchase price for the unit solely for the shares included in
  such unit. 

 3.3.3. Valid Issuance.
  All shares of Common Stock 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
  shares of Common Stock 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 stock 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 stock transfer books are
  open. 

   

   

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 3.3.5. Intentionally Omitted.  

 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 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 of such stock dividend, split-up or similar event, the number of
  shares of Common Stock issuable on exercise of each Warrant shall be increased
  in proportion to such increase in outstanding shares of Common Stock. 

 4.1.2. Extraordinary Dividend. If the Company, at any time during the Exercise
  Period, shall pay a dividend or make a distribution in cash, securities or
  other assets to the holders of Common Stock (or other shares of the
  Company’s capital stock into which the Warrants are convertible), other
  than (w) as described in Sections 4.1.1, 4.2 or 4.4, (x) regular quarterly or
  other periodic dividends, (y) in connection with the conversion rights of the
  holders of Common Stock upon consummation of the Company’s initial
  Business Combination (as such term is used in the Registration Statement) or
  (z) 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/or 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 Common Stock in respect of such Extraordinary
  Dividend. 

 4.2. Aggregation of Shares. If after the date hereof, and subject to the
  provisions of Section 4.6, the number of outstanding shares of Common
  Stock is decreased by a consolidation, combination, reverse stock split or
  reclassification of shares of Common Stock or other similar event, then, on the
  effective date of such consolidation, combination, reverse stock split,
  reclassification or similar event, the number of shares of Common Stock
  issuable on exercise of each Warrant shall be decreased in proportion to such
  decrease in outstanding shares of Common Stock. 

 4.3. Adjustments in Exercise Price. Whenever the number of shares of Common Stock
  purchasable upon the exercise of the Warrants is adjusted, as provided in
  Section 4.1 and 4.2 above, the  

   

   

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 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
  shares of Common Stock purchasable upon the exercise of the Warrants
  immediately prior to such adjustment, and (y) the denominator of which shall be
  the number of shares of Common Stock so purchasable immediately
  thereafter. 

 4.4. 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 4.1 or 4.2 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 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 shares of Common Stock 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 shares of Common Stock covered
  by Section 4.1 or 4.2, then such adjustment shall be made pursuant to
  Sections 4.1, 4.2, 4.3 and this Section 4.4. The provisions of this
  Section 4.4 shall similarly apply to successive reclassifications,
  reorganizations, mergers or consolidations, sales or other transfers. 

 4.5. 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 or 4.4, 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. 

   

   

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 4.6. 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 shares of Common Stock to be issued to the Warrant
  holder. 

 4.7. 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. 

 4.8 Notice of Certain Transactions. In the event that the Company shall propose to
  (a) offer the holders of its Common Stock rights to subscribe for or to
  purchase any securities convertible into shares of Common Stock or shares of
  stock of any class or any other securities, rights or options, (b) issue
  any rights, options or warrants entitling the holders of Common Stock to
  subscribe for shares of Common Stock or (c) make a tender offer,
  redemption offer or exchange offer with respect to the Common Stock, the
  Company shall send to the Warrant holders a notice of such proposed action or
  offer. Such notice shall be mailed to the registered holders at their addresses
  as they appear in the Warrant Register, which shall specify the record date for
  the purposes of such dividend, distribution or rights, or the date such
  issuance or event is to take place and the date of participation therein by the
  holders of Common Stock, if any such date is to be fixed, and shall briefly
  indicate the effect of such action on the Common Stock and on the number and
  kind of any other shares of stock and on other property, if any, and the number
  of shares of Common Stock and other property, if any, issuable upon exercise of
  each Warrant and the Warrant Price after giving effect to any adjustment
  pursuant to this Article 4 which would be required as a result of such
  action. Such notice shall be given as promptly as practicable after the Board
  has determined to take any such action and (x) in the case of any action
  covered by clause (a) or (b) above at least 10 days prior to the
  record date for determining the holders of the Common Stock for purposes of
  such action or (y) in the case of any other such action at least
  20 days prior to the date of the taking of such proposed action or the
  date of participation therein by the holders of Common Stock, whichever shall
  be the earlier.  

   

   

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 4.9 Other Events. If
  any event occurs as to which the foregoing provisions of this Article 4
  are not strictly applicable or, if strictly applicable, would not, in the good
  faith judgment of the Board, fairly and adequately protect the purchase rights
  of the registered holders of the Warrants in accordance with the essential
  intent and principles of such provisions, then the Board shall make such
  adjustments in the application of such provisions, in accordance with such
  essential intent and principles, as shall be reasonably necessary, in the good
  faith opinion of the Board, to protect such purchase rights as aforesaid.  

 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  

   

   

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 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.  

 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 there is an effective registration statement covering the
  shares of common stock issuable upon exercise of the Warrants current and
  available 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
  Common Stock has been at least $14.25 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. The Warrants will not be
  redeemed unless there is an effective registration statement covering the
  shares of common stock issuable upon exercise of the Warrants current and
  available throughout the “30-day redemption period” (defined
  below). 

 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. Notice of redemption shall be mailed by first class mail, postage
  prepaid, by the Company not less than 30 days prior to the date fixed for
  redemption (the “30-day redemption period”) 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. 

 6.3. Exercise After Notice of Redemption. The Warrants may be exercised for cash at any time
  after notice of redemption shall have been given by the Company pursuant to
  Section 6.2 hereof and prior to the time and date fixed for redemption. 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. Exclusion of Certain Warrants. The Founders’ Warrants and Sponsors’
  Warrants shall not be redeemable by the Company as long as such Warrants
  continue to be held by the Founders and Sponsors or their permitted
  transferees. However, once such individuals or their permitted transferees
  transfer such Founders’ Warrants or Sponsors’ Warrants, such warrants
  shall then be redeemable by the Company pursuant to Section 6 hereof. 

   

   

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 7. Other Provisions Relating to Rights of Holders of
  Warrants. 

 7.1. No Rights as Stockholder. A Warrant does not entitle the registered holder
  thereof to any of the rights of a stockholder 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
  stockholders in respect of the meetings of stockholders or the election of
  directors of the Company or any other matter. 

 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 Common Stock. The Company shall at all times reserve and keep
  available a number of its authorized but unissued shares of Common Stock that
  will be sufficient to permit the exercise in full of all outstanding Warrants
  issued pursuant to this Agreement. 

 7.4. Registration of Common Stock. The Company agrees that prior to the commencement of
  the Exercise Period, it shall use its best efforts to file with the Securities
  and Exchange Commission a post-effective amendment to the Registration
  Statement, or a new registration statement, for the registration, under the
  Act, of, 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 Common Stock 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. The Warrants shall not be exercisable and the
  Company shall not be obligated to issue Common Stock unless, at the time a
  holder seeks to exercise the Warrants, a prospectus relating to Common Stock
  issuable upon exercise of the Warrants is current and the Common Stock has been
  registered or qualified or deemed to be exempt under the securities laws of the
  state of residence of the holder of the Warrants. The provisions of this
  Section 7.4 may not be modified, amended or deleted without the prior
  written consent of Citigroup Global Markets Inc. 

   

   

 12 

   

 

 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 shares of Common Stock 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. 

 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 Common Stock not later than the effective
  date of any such appointment. 

   

   

 13 

   

 

 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. 

 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. 

   

   

 14 

   

 

 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 shares of Common Stock to be issued pursuant to this Agreement or any
  Warrant or as to whether any shares of Common Stock will when issued be valid
  and fully paid and nonassessable.  

 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 shares of Common Stock 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: 

 Highlands Acquisition Corp. 

 One Paragon Drive, Suite 125 

 Montvale, New Jersey 07645 

 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: 

   

   

 15 

   

 

 Continental Stock Transfer & Trust
  Company  

 17 Battery Place 

 New York, New York 10004 

 Attn: Compliance Department 

 with a copy in each case to: 

 Graubard Miller 

 The Chrysler Building 

 405 Lexington Avenue 

 New York, New York 10174 

 Attn: David Alan Miller, Esq. 

 Facsimile: (212) 818-8881 

 and 

 Bingham McCutchen LLP 

 399 Park Avenue 

 New York, New York 10022 

 Attn: Ann F. Chamberlain, Esq. 

 Facsimile: (212) 752-5378 

 and 

 Citigroup Global Markets Inc. 

 388 Greenwich Street 

 New York, New York 10013 

 Attn: David Spivak 

 Facsimile: (212) 723-8871 

 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. 

   

   

 16 

   

 

 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 Sections 2.5, 2.6, 6.1, 6.4, 7.4, 9.2
  and 9.8 hereof, Citigroup Global Markets Inc., any right, remedy, or claim
  under or by reason of this Warrant Agreement or of any covenant, condition,
  stipulation, promise, or agreement hereof. Citigroup Global Markets Inc. shall
  be deemed to be a third-party beneficiary of this Agreement with respect to
  Sections 2.5, 2.6, 6.1, 6.4, 7.4, 9.2 and 9.8 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 Citigroup Global Markets Inc. with respect to the Sections 2.5, 2.6, 6.1,
  6.4, 7.4, 9.2 and 9.8 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. 

 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 of Citigroup Global Markets Inc. and 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. 

   

   

 17 

   

 

 9.9 Severability.
  This Agreement shall be deemed severable, and the invalidity or
  unenforceability of any term or provision hereof shall not affect the validity
  or enforceability of this Agreement or of any other term or provision hereof.
  Furthermore, in lieu of any such invalid or unenforceable term or provision,
  the parties hereto intend that there shall be added as a part of this Agreement
  a provision as similar in terms to such invalid or unenforceable provision as
  may be possible and be valid and enforceable. 

   

   

 18 

   

 

 IN WITNESS WHEREOF, this Agreement has been
  duly executed by the parties hereto as of the day and year first above
  written. 

   

  	   
	   
	 HIGHLANDS ACQUISITION CORP. 

	 
	   
	 

          By:  
	 

	   
	   
	   
	 Name: 

	   
	   
	   
	 Title: 

   

  	   
	   
	 CONTINENTAL STOCK
          TRANSFER

              & TRUST
          COMPANY 

	 
	   
	 

          By:  
	 

	   
	   
	   
	 Name: 

	   
	   
	   
	 Title: 

   

   

 19Exhibit 10.18

August 27, 2007 

Highlands Acquisition Corp. 

One Paragon Drive, Suite 125

Montvale, New Jersey 07645

 

Ladies and Gentlemen: 

Each of the undersigned agrees that it will not transfer its ownership interests in Highland Equity LLC, Fieldpoint Capital, LLC and Ivy Healthcare Capital II, L.P.  to anyone other than the founders of Highlands Acquisition Corp. (“Company”) or entities of which such founders are the beneficial owners, or beneficiaries, of until the transfer restrictions (as more fully described in the Company’s Registration Statement relating to its initial public offering and in the Escrow Agreement filed as an exhibit to such Registration Statement) relating to the Company’s securities held by Highland Equity LLC, Fieldpoint Capital, LLC and Ivy Healthcare Capital II, L.P. are removed. 

 

__________________________

__________________________

__________________________

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