Document:

EXHIBIT 4.4

    

    FORM
OF WARRANT AGREEMENT

     

    This
Warrant Agreement (the “Agreement”) made as of _____,
2010, between SMG Indium Resources Ltd., a Delaware corporation, with offices at
41 University Drive, Suite 400, Newton, Pennsylvania 18940 (the “Company”), and Continental
Stock Transfer & Trust Company, a New York corporation, with offices at 17
Battery Place, New York, New York 10004 (the “Warrant Agent”).

     

    WHEREAS,
the Company has undertaken a public offering (the “Public Offering”) of units of
the Company (the “Units”), each Unit consisting
of one share of common stock, par value $.001 per share, of the Company (the
“Common Stock”) and one
warrant exercisable for one share of Common Stock, and in connection therewith,
has determined to issue and deliver (i) 5,000,000 Warrants (the “Public Warrants”) to the
public investors and (ii) 250,000 Warrants to Sunrise Securities Corp. and
Rodman & Renshaw, LLC (the “Representatives”) or its
designees (the “Representatives’ Warrants”
and, together with the Public Warrants, the “Warrants”), in each case
subject to adjustments as described herein;

     

    WHEREAS,
the Company has filed, with the Securities and Exchange Commission (the “Commission”), a registration
statement, No. 333-165930, on Form S-1 (the “Registration Statement”) for
the registration, under the Securities Act of 1933, as amended (the “Act”), of, among other
securities, the Public Warrants and the Representative’s Warrants and the Common
Stock issuable upon exercise of the Public Warrants and the Representative’s
Warrants;

     

    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, exercise and cancellation of the
Warrants;

     

    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 legally valid and binding
obligations of the Company, and to authorize the execution and delivery of this
Agreement.

     

    NOW,
THEREFORE, in consideration of the mutual agreements herein contained, the
parties hereto agree as follows:

     

    1.           
Appointment of Warrant
Agent. The Company hereby appoints the Warrant Agent to act as agent for
the Company for the Warrants, and the Warrant Agent hereby accepts such
appointment and agrees to perform the same in accordance with the terms and
conditions set forth in this Agreement.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    2.           
Warrants.

     

    2.1          Form of Public
Warrant. Each Warrant shall be issued in registered form only, shall be
in substantially the form of Warrant attached hereto as Exhibit A, the
provisions of which are incorporated herein, and shall be signed by, or bear the
facsimile signature of, (i) the Chairman of the Board, the Chief Executive
Officer or the President, and (ii) the 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          Form of Representatives’
Warrant. The Representatives’ Warrants will be issued in the same form as
the Public Warrants, except that each of the Representatives’ Warrants, (i) is
exercisable at a price equal to 110% of the exercise price of the Public
Warrants, (ii) subject to certain limited exceptions described below, will not
be transferable or salable for a period of one year after the date of the final
prospectus included in the Registration Statement, (ii) will be exercisable on a
cashless basis in accordance with Section 3.1(b) hereof, (iv) will not be
redeemable by the Company, and (v) may be exercised for unregistered shares so
long as a registration statement relating to the Common Stock issuable upon
exercise of the warrants is not effective and current.

    

    2.3          Effect of
Countersignature. Unless and until countersigned by the Warrant Agent
pursuant to this Warrant Agreement, a Warrant shall be invalid and of no effect
and may not be exercised by the holder thereof.

     

    2.4          Registration.

     

    2.4.1        Warrant Register. The
Warrant Agent shall maintain books (“Warrant Register”), for the
registration of the original issuance and registration of transfers 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.

     

    2.4.2        Registered Holder.
Prior to due presentment for registration of transfer of any Warrant, the
Company and the Warrant Agent may deem and treat the person in whose name such
Warrant shall be registered upon the Warrant Register (“Registered Holder”), as the
absolute owner of such Warrant and of each Warrant represented thereby
(notwithstanding any notation of ownership or other writing on the warrant
certificate made by anyone other than the Company or the Warrant Agent), for the
purpose of any exercise thereof, and for all other purposes, and neither the
Company nor the Warrant Agent shall be affected by any notice to the
contrary.

     

    2.5          Detachability of
Warrants. The securities comprising the Units may trade separately
beginning on the 90th day
after the effective date of the registration statement unless the
Representatives determines that an earlier date is acceptable, but in no event
will the Representatives permit separate trading of the common stock and
warrants until the business day following the earlier to occur of (i) the
expiration or termination of the underwriters’ over-allotment option or (ii) its
exercise in full (the “Detachment
Date”).

    
      
         

      

      
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    3.           
Terms and Exercise of
Warrants.

     

    3.1           Warrant Price. Each
Public Warrant shall, when countersigned by the Warrant Agent, entitle the
registered holder thereof, subject to the provisions of such Public Warrant and
of this Agreement, to purchase from the Company the number of shares of Common
Stock stated therein, at the price of $5.75 per whole share, subject to the
adjustments provided in Section 4 hereof and in the last sentence of this
Section 3.1. Each Representative’s Warrant shall, when countersigned by the
Warrant Agent, entitle the registered holder thereof, subject to the provisions
of such Representative’s Warrant and of this Agreement, to purchase from the
Company the number of shares of Common Stock stated therein, at the price of
$5.50 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
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 (as defined
below); provided, however, that any change in the Warrant Price must apply
equally to all of the Warrants, and provided further that any amendment to the
term of the Representative’s Warrants shall be subject to any limitations and
conditions that may be imposed by FINRA Corporate Finance Rule 2710, and
provided further that any reduction in Warrant Price shall remain in effect for
at least twenty (20) business days.

     

    3.2           Duration of Warrants.
Except as set forth in this Section 3.2, a Warrant may be exercised only during
the period (“Exercise
Period”) commencing immediately upon the effectiveness of the
Registration Statement, and terminating at 5:00 p.m., New York City time, on the
earlier to occur of (i) _______, 2015 and (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 any such
extension of the duration of the Warrants shall apply equally to all of the
Warrants, except that any amendment to the terms of the Representative’s
Warrants shall be subject to any limitations and conditions that may be imposed
by FINRA Corporate Finance Rule 2710. Should the Company wish to extend the
Expiration Date of the Warrants, the Company shall provide at least twenty (20)
days advance notice to the NASDAQ Stock Market, LLC (or the principal trading
market for the Warrants) of such extension.

     

     Notwithstanding
the foregoing, a Warrant can expire unexercised regardless of whether a
registration statement is current under the Act with respect to the Common Stock
issuable upon exercise of the Warrants.

    

    
      
        
        

      

      
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    3.3          Exercise of
Warrants.

    

    3.3.1  
     Payment. Subject to
the provisions of the Warrant and this Warrant Agreement, a Warrant, when
countersigned by the Warrant Agent, may be exercised by the registered holder
thereof by surrendering it, at the office of the Warrant Agent, or at the office
of its successor as Warrant Agent, in the Borough of Manhattan, City and State
of New York, with the subscription form, as set forth in the Warrant, duly
executed, and by paying in full, the Warrant Price for each whole share of
Common Stock as to which the Warrant is exercised and any and all applicable
taxes due in connection with the exercise of the Warrant, the exchange of the
Warrant for the Common Stock, and the issuance of the Common Stock, as
follows:

    

    (a)           in
cash, good certified check or good bank draft payable to the order of the
Company (or as otherwise agreed to by the Company); or

    

    (b)           with
respect to any Representatives’ Warrants, by surrendering such Representatives’
Warrants for that number of shares of Common Stock equal to the quotient
obtained by dividing (x) the product of the number of shares of Common Stock
underlying the Representatives’ Warrants, multiplied by the difference between
the Warrant Price and the Fair Market Value (as defined below) by (y) the Fair
Market Value. Solely for purposes of this Section 3.3.1(b), the “Fair Market
Value” shall mean the average reported last sale price of the Common Stock for
the five trading days ending on the trading day prior to the date on which the
Representatives’ Warrants are exercised.

     

    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 representing the number of full shares of Common Stock to which he,
she or it 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.

    

    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 or entity 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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    4.            Adjustments.

    4.1           Stock Dividends -
Split-Ups. If, at any time during the Exercise Period, 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.

    

    4.2           Extraordinary
Dividends.  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 (i) as described in
Sections 4.1, 4.3 or 4.5, (ii) regular quarterly or other periodic dividends,
(iii) in connection with the Company’s liquidation and the distribution of its
assets (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.

     

    4.3           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.

     

    4.4           Adjustments in Exercise
Price. Whenever the number of shares of Common Stock purchasable upon the
exercise of the Warrants is adjusted, as provided in Sections 4.1, 4.2 and
4.3 above, the Warrant Price shall be adjusted (to the nearest cent) by
multiplying such Warrant Price, immediately prior to such adjustment, by a
fraction, (i) 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 (ii) the denominator of which shall be the number of shares of
Common Stock so purchasable immediately thereafter.

     

    4.5           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 Sections 4.1, 4.2 or 4.3 hereof or one 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 Sections 4.1, 4.2 or 4.3, then such adjustment
shall be made pursuant to Sections 4.1, 4.2, 4.3, 4.4 and this
Section 4.5. The provisions of this Section 4.5 shall similarly apply
to successive reclassifications, reorganizations, mergers or consolidations,
sales or other transfers.

    
      
         

      

      
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    4.6           Notices of Changes in
Warrant. Upon every adjustment of the Warrant Price or the number of
shares issuable upon exercise of a Warrant, the Company shall give written
notice thereof to the Warrant Agent, which notice shall state the Warrant Price
resulting from such adjustment and the increase or decrease, if any, in the
number of shares purchasable at such price upon the exercise of a Warrant,
setting forth in reasonable detail the method of calculation and the facts upon
which such calculation is based. Upon the occurrence of any event specified in
Sections 4.1, 4.2, 4.3, 4.4 or 4.5 the Company shall give written notice to each
Warrant holder, at the last address set forth for such holder in the Warrant
Register, of the record date or the effective date of the event. Failure to give
such notice, or any defect therein, shall not affect the legality or validity of
such event.

    

    4.7       
   No
Fractional Shares. Notwithstanding any provision contained in this
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 to the nearest whole number the number of the
shares of Common Stock to be issued to the Warrant holder.

     

    4.8         
 Form of
Warrant. The form of Warrant need not be changed because of any
adjustment pursuant to this Section 4, and Warrants issued after such
adjustment may state the same Warrant Price and the same number of shares as is
stated in the Warrants initially issued pursuant to this Agreement. However, the
Company may, at any time, in its sole discretion, make any change in the form of
Warrant that the Company may deem appropriate and that does not affect the
substance thereof, and any Warrant thereafter issued or countersigned, whether
in exchange or substitution for an outstanding Warrant or otherwise, may be in
the form as so changed.

     

    5.            Transfer and Exchange of
Warrants.

     

    5.1           Transfer of
Warrants.  Prior to the Detachment Date, the Public Warrants
may be transferred or exchanged only together with the Unit in which such
Warrant is included, and only for the purpose of effecting, or in conjunction
with, a transfer or exchange of such Unit. Furthermore, each transfer of a
Public Unit on the register relating to such Units shall operate also to
transfer the Warrants included in such Unit. From and after the Detachment Date
this Section 5.1 will have no further force and effect.

    
      
         

      

      
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    5.2           Registration of
Transfer. The Warrant Agent shall register the transfer, from time to
time, of any outstanding Warrant into 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 the Company’s request.

     

    5.3           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 a Warrant
surrendered for transfer bears a restrictive legend, the Warrant Agent shall not
cancel such Warrant and shall issue new Warrants in exchange therefor until the
Warrant Agent has received an opinion of counsel for the Company stating that
such transfer may be made and indicating whether the new Warrants must also bear
a restrictive legend.

     

    5.3           Fractional Warrants.
The Warrant Agent shall not be required to effect any registration of transfer
or exchange which will result in the issuance of a warrant certificate for a
fraction of a warrant.

     

    5.4           Service Charges. No
service charge shall be made for any exchange or registration of transfer of
Warrants.

     

    5.5          Warrant Execution and
Countersignature. The Warrant Agent is hereby authorized to countersign
and to deliver, in accordance with the terms of this Agreement, the Warrants
required to be issued pursuant to the provisions of this Section 5, and the
Company, whenever required by the Warrant Agent, will supply the Warrant Agent
with Warrants duly executed on behalf of the Company for such
purpose.

    

    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 after they become
exercisable and prior to their expiration, at the office of the Warrant Agent,
upon the notice referred to in Section 6.2 hereof, at a redemption price of
$.01 per Warrant (the “Redemption Price”), provided
that (i) the last sales price of the Common Stock has been equal to or greater
than $8.00 per share (the “Trigger Price”) for any twenty
(20) trading days within a thirty (30) trading day period ending on the third
business day prior to the date on which notice of redemption is given and (ii)
the Public Warrants and the shares of Common Stock underlying such Warrants are
covered by an effective registration statement and a current prospectus from the
beginning of the measurement period through the date fixed for
redemption.  The provisions of this Section 6.1 may not be
modified, amended or deleted without the prior written consent of the
Representatives.

    
      
         

      

      
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    6.2           Date Fixed for, and Notice
of, Redemption. In the event the Company shall elect to redeem all of the
Warrants, the Company shall fix a date for the redemption (the “Redemption Date”), which shall
be prior to the expiration of the Warrants. Notice of redemption shall be mailed
by first class mail, postage prepaid, by the Company not less than thirty (30)
days prior to the date fixed for redemption to the registered holders of the
Warrants to be redeemed at their last addresses as they shall appear on the
Warrant Register. Any notice mailed in the manner herein provided shall be
conclusively presumed to have been duly given on the date sent, whether or not
the registered holder received such notice.  In the event of any
adjustment to the Warrant Price or the number of shares of Common Stock issuable
on exercise of each Warrant as provided in Section 4, a proportional adjustment
shall be made to the Trigger Price.

     

    6.3           Exercise After Notice of
Redemption. The Warrants may be exercised in accordance with
Section 3 of this Warrant Agreement at any time after notice of redemption
shall have been given by the Company pursuant to Section 6.2 hereof and
prior to the 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           No Other Rights to Cash
Payment. Except for a redemption in accordance with this Section 6, no
holder of any Warrant shall be entitled to any cash payment whatsoever from the
Company in connection with the ownership, exercise or surrender of any Warrant
under this Agreement, regardless of whether a registration statement is current
under the Act with respect to the Common Stock issuable upon exercise of the
Warrants.

     

    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 terms 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.

    
      
         

      

      
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    7.4           Registration of Common
Stock. The Company agrees that, prior to the commencement of the Exercise
Period, it shall file with the Commission a post-effective amendment to the
Registration Statement, or a new registration statement, for the registration
under the Act of, and it shall take such action as is necessary to qualify for
sale in those states in which the Public Warrants and the Representative’s
Warrants were initially offered by the Company, the Common Stock issuable upon
exercise of the Public Warrants and the Representative’s Warrants. In either
case, the Company will use its best efforts to cause the same to become
effective on or prior to the commencement of the Exercise Period, to maintain
the effectiveness of such registration statement and to ensure that a current
prospectus is on file with the Commission until the expiration or redemption of
the Warrants in accordance with the provisions of this Agreement; provided,
however, that the Company shall not be obligated to deliver shares of Common
Stock issuable upon exercise of the Public Warrants, and shall not have
penalties nor be liable to the Warrant holder for failure to deliver shares, if
a registration statement is not effective or a current prospectus is not on file
with the Commission at the time of exercise of the Public Warrant by a holder.
In addition, the Company agrees to use its reasonable efforts to register such
securities under the blue sky laws of the states of residence of the exercising
warrant holders to the extent an exemption is not available.  The
provisions of this Section 7.4 may not be modified, amended or deleted
without the prior written consent of the Representative.

    

    7.5         
Delivery of Prospectus
or Notice.  Upon the exercise of any Warrant, if the Company
requests, the Warrant Agent shall deliver to the holder of such Warrant, prior
to or concurrently with the delivery of the shares of Common Stock issuable upon
such exercise, in accordance with the Company’s request, either (i) a prospectus
relating to the shares of Common Stock deliverable upon exercise of the Warrants
and complying in all material respects with the Act or (ii) the notice referred
to in Rule 173 under the Act.

    

    7.6         
Limitation on Monetary
Damages. In no event shall the registered holder of a Public Warrant be
entitled to receive monetary damages for failure to settle any Warrant exercise
if the Common Stock issuable upon exercise of the Public Warrants has not been
registered with the Securities and Exchange Commission pursuant to an effective
registration statement or if a current prospectus is not available for delivery
by the Warrant Agent, provided the Company has fulfilled its obligations under
Section 7.4 to use its best efforts to effect the registration under the Act of
the Common Stock issuable upon exercise of the Warrants.

     

    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.

    

      
        
           

        

        
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    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 thirty (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, her or its
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. 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 have its
principal office in the Borough of Manhattan, City and State of New York, and be
authorized under such laws to exercise corporate trust powers and subject to
supervision or examination by federal or state authorities. 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.

     

    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 on the part
of the Company or the Warrant Agent.

     

    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 Warrant Agent hereunder as set forth on Exhibit B hereto 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.

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    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,
Chairman of the Board of Directors or President 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 Warrant Agreement, except as a result of the Warrant
Agent’s negligence, willful misconduct or bad faith.

     

    8.4.3        Exclusions. The
Warrant Agent shall have no responsibility with respect to the validity of this
Warrant 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 Warrant
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
the Company’s Common Stock through the exercise of Warrants.

    

    9.            Miscellaneous
Provisions.

     

    9.1           Successors. All the
covenants and provisions of this Warrant 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.

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    

    9.2           Notices. Any notice,
consent or request to be given in connection with any of the terms or provisions
of this Agreement shall be in writing and shall be sent express mail or similar
overnight courier service, by certified mail (return receipt requested), by hand
delivery or by facsimile transmission:

     

    If to the
Company, to:

    SMG Indium Resources Ltd.

    41 University Drive, Suite
400

    Newtown, Pennsylvania
18940

    Attn:  Ailon Z.
Grushkin

    

     If
to the Warrant Agent, to:

    Continental Stock Transfer & Trust
Company

    17
Battery Place

    New York,
New York 10004

    Attn:
Compliance Department

     

    with a
copy in each case (which shall not constitute notice) to:

     

    Ellenoff
Grossman & Schole LLP

    150 East
42nd
Street

    New York,
New York 10017

    Attn:
Barry I. Grossman, Esq.

    

    and

    Mintz Levin Cohn Ferris Glovsky &
Popeo, P.C.

    666 Third Avenue

    New York, New York 10017

    Attn:  Kenneth R. Koch,
Esq.

    

    
      and

    

    Sunrise
Securities Corp.

    600
Lexington Avenue, 4th
Floor

    New York,
New York 10022

    Attn:  Nathan
Low

    

    and

    Rodman
& Renshaw, LLC

    1251
Avenue of the Americas, 20th
Floor

    New York,
New York 10020

    Attn: 
●

    Fax: 
●

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

    Any
notice, sent pursuant to this Agreement shall be effective, if delivered by
hand, upon receipt thereof by the party to whom it is addressed, if sent by
overnight courier, on the next business day of the delivery to the courier, and
if sent by registered or certified mail on the third day after registration or
certification thereof.

     

    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 the conflict of laws principles thereof. The
Company and the Warrant Agent each 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
and the Warrant Agent each hereby waives any objection to such exclusive
jurisdiction and that such courts represent an inconvenient forum. Any such
process or summons to be served upon the Company or the Warrant Agent 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 or the Warrant Agent in any action,
proceeding or claim.

     

    9.4           Persons Having Rights under
this Warrant 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  6.1, 6.4, 7.4, 9.2 and 9.8 hereof, the Representatives, any
right, remedy or claim under or by reason of this Agreement or of any covenant,
condition, stipulation, promise or agreement hereof. the Representative shall be
deemed to be a third-party beneficiary of this Agreement with respect to
Sections 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 the
Representative, with respect to the Sections 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
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, her or its Warrant for
inspection.

     

    9.6           Counterparts; Facsimile
Signatures. This Agreement may be executed in any number of counterparts,
and each of such counterparts shall, for all purposes, be deemed to be an
original, and all such counterparts shall together constitute one and the same
instrument. Facsimile signatures shall constitute original signatures for all
purposes of this Warrant Agreement.  Facsimile signatures shall
constitute original signatures for all purposes of this Agreement.

     

    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.

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

    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 Warrant 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 each of the Representative 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 in accordance with Sections 3.1 and 3.2, respectively, without such
consent.

    

    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.

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

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

    

    
      
        
          
            
              
                
                  
                    	
                            Attest

                          	 
      	
                            SMG
      INDIUM RESOURCES LTD.

                          
	 
      	 
      	 
      	 
      
	 
      	 
      	
                            By:

                          	 
      
	 
      	 
      	 
      	
                            Name:  Ailon
      Z. Grushkin

                          
	 
      	 
      	 
      	
                            Title:    President

                          
	 	 	 	 
	
                            Attest

                          	 
      	
                            CONTINENTAL
      STOCK TRANSFER  & TRUST

                            COMPANY

                          
	 
      	 
      	 
      	 
      
	 
      	 
      	
                            By:

                          	 
      
	 
      	 
      	 
      	
                            Name:
       

                          
	 
      	 
      	 
      	
                            Title:
       

                          

                  

                

              

            

          

        

      

    

    
      
         

      

      
        15

        
          

        

      

      
         

      

    

    EXHIBIT
A

     

    Form of Public
Warrant

    
      
         

      

      
        16

        
          

        

      

      
         

      

    

    EXHIBIT
B

    

    Warrant Agent
Fees

    
      
         

      

      
        17EXHIBIT
4.5

     

    THE
REGISTERED HOLDER OF THIS PURCHASE OPTION, BY ITS ACCEPTANCE HEREOF, AGREES THAT
IT WILL NOT SELL, TRANSFER OR ASSIGN THIS PURCHASE OPTION, EXCEPT AS HEREIN
PROVIDED, AND THE REGISTERED HOLDER OF THIS PURCHASE OPTION AGREES THAT IT WILL
NOT SELL, TRANSFER, ASSIGN, PLEDGE OR HYPOTHECATE THIS PURCHASE OPTION FOR A
PERIOD OF ONE YEAR FOLLOWING THE EFFECTIVE DATE (DEFINED BELOW) TO ANYONE OTHER
THAN (I) SUNRISE SECURITIES CORP., RODMAN & RENSHAW, LLC, OR AN UNDERWRITER
OR A SELECTED DEALER IN CONNECTION WITH THE OFFERING (DEFINED HEREIN), OR (II)
ANY SUCCESSOR, MANAGER, OFFICER, PARTNER, MEMBER OR EMPLOYEE OF SUNRISE
SECURITIES CORP., RODMAN & RENSHAW, LLC OR OF ANY SUCH UNDERWRITER OR
SELECTED DEALER.

    

    UNIT
PURCHASE OPTION

    

    FOR THE
PURCHASE OF

    

    250,000
UNITS

    

    OF

    

    SMG
INDIUM RESOURCES LTD.

     

    1.           Purchase
Option.

     

    THIS
CERTIFIES THAT, in consideration of $100.00 duly paid by or on behalf of SUNRISE SECURITIES CORP., RODMAN
& RENSHAW, LLC or their designees (each, a “Holder”), as registered owner
of this Purchase Option (“Purchase Option”), to SMG
Indium Resources Ltd. (the “Company”), Holder is entitled,
at any time or from time to time after ________, 2011 (“Effective Date”), and at or before 5:00
p.m., New York City local time, ___________, 2015 (“Expiration Date”), but not
thereafter, to subscribe for, purchase and receive, in whole or in part, up to
TWO HUNDRED FIFTY THOUSAND (250,000) units (“Units”) of the Company, each
Unit consisting of one share of common stock of the Company, par value $.001 per
share (“Common Stock”),
and one warrant (“Warrant”) expiring four years
from the Effective Date of the registration statement (“Registration Statement”)
pursuant to which Units are offered for sale to the public (the “Offering”).  Each
Warrant is on the same terms and conditions 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 exercise price of each Warrant is $____ per
share (such exercise price, as it may be adjusted hereunder, the “Underwriter’s Warrant
Price”).  If the Expiration Date is a day on which banking
institutions are authorized by law to close in New York City, then this Purchase
Option may be exercised on the next succeeding day which is not such a day in
accordance with the terms herein.  During the period ending on the
Expiration Date, the Company agrees not to take any action that would terminate
the Purchase Option.  This Purchase Option is initially exercisable at
$__ per 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 per Unit or the adjusted exercise price per Unit,
depending on the context.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    2.           Exercise.

     

    2.1          Exercise
Form.  In order to exercise this Purchase Option, the exercise
form attached hereto must be duly executed and completed and delivered to the
Company, together with this Purchase Option and payment of the Exercise Price
for the 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., New York City local 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 (the “Securities 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.

     

    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
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 Units (or 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) of the portion of the Purchase Unit Option being
converted.  The “Value” of the portion of the Purchase Option being
converted shall equal the remainder derived from subtracting (a)the product of
(i) the Exercise Price multiplied by (ii) the number of Units underlying the
portion of this Purchase Option being converted from (b) the product of (i) the
Current Market Value of a Unit multiplied by (ii) 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: (i) if the Units are listed on a
national securities exchange (including, without limitation, the NYSE Euronext
and the NASDAQ Stock Market) or quoted on the Over the Counter Bulletin Board
(or any successor electronic inter-dealer quotation system), the average closing
price of a Unit for the thirty (30) trading days immediately preceding the date
of determination of the Current Market Price in the principal trading market for
the Units as reported by the exchange or the quotation system, as the case may
be; (ii) if the Units are not listed on a national securities exchange or quoted
on Over the Counter Bulletin Board (or any successor electronic inter-dealer
quotation system), but are traded in the residual over-the-counter market, the
closing bid price for a Unit on the last trading day preceding the date in
question for which such quotations are reported by the Pink Sheets, LLC or
similar publisher of such quotations; and (iii) if the fair market value of the
Units 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-

        
          

        

      

      
         

      

    

    2.3.1           Mechanics of Cashless
Exercise.  The cashless exercise right described in this
Section 2.3 (“Cashless Exercise
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 with the duly executed exercise form attached hereto with the
cashless exercise section completed to the Company, exercising the Cashless
Exercise Right and specifying the total number of Units the Holder will purchase
pursuant to such Cashless Exercise Right.

     

    2.4          Net Cash
Settlements.  In no event will the Company be required to net
cash settle the exercise of the Purchase Option or the Warrants underlying the
Purchase Option, regardless of whether any or all of the Registrable Securities
have been registered by the Company pursuant to an effective registration
statement.

     

    3.           Transfer.

     

    3.1          General
Restrictions.  The registered Holder of this Purchase Option,
by its acceptance hereof, agrees that it will not sell, transfer, assign, pledge
or hypothecate, or enter into any hedging, short sale, derivative, put, or call
transaction that would result in the effective economic disposition of, this
Purchase Option for a period of one year following the Effective Date to anyone
other than (i) a Holder or an underwriter or a selected dealer in connection
with the Offering, or (ii) any successor, officer, manager, partner, member or
employee of a Holder or of any such underwriter or selected
dealer.  On and after the first anniversary of the Effective Date,
transfers to others may be made subject to compliance with or exemptions from
applicable securities laws.  In order to make any permitted
assignment, the Holder must deliver to the Company the assignment form attached
hereto duly executed and completed, together with the Purchase Option and
payment of all transfer taxes, if any, payable in connection
therewith.  The Company shall within five business days transfer this
Purchase Option on the books of the Company and shall execute and deliver a new
Purchase Option or Purchase Options of like tenor to the appropriate assignee(s)
expressly evidencing the right to purchase the aggregate number of Units
purchasable hereunder or such portion of such number as shall be contemplated by
any such assignment.

    
      
         

      

      
        -3-

        
          

        

      

      
         

      

    

     

    3.2          Restrictions Imposed by the
Act.  The securities evidenced by this Purchase Option shall
not be transferred unless and until (i) the Company has received the opinion of
counsel for the Holder that the securities may be transferred pursuant to an
exemption from registration under the Securities 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
Mintz Levin Cohn Ferris Glovsky & Popeo, P.C. shall be deemed satisfactory
evidence of the availability of an exemption), or (ii) a registration statement
or a post-effective amendment to the Registration Statement relating to such
securities has been filed by the Company and declared effective by the
Securities and Exchange Commission (the “Commission”) and compliance
with applicable state securities law has been established.

     

    4.           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, except in the case of an exercise of
this Purchase Option contemplated by Section 2.3 hereof, funds sufficient to pay
any Exercise Price 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.  In addition, the Company shall cause to
be delivered to any Permitted Transferee without charge a new Purchase Option of
like tenor to this Purchase Option in the name of such transferee evidencing the
right of such transferee to purchase the number of Units purchasable hereunder
as to which this Purchase Option has been transferred to such
transferee.

     

    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.

    
      
         

      

      
        -4-

        
          

        

      

      
         

      

    

     

    5.           Registration
Rights.

     

    5.1          Demand
Registration.

     

    5.1.1           Grant of
Right.  The Company, upon written demand (“Initial Demand Notice”) of the
Holder(s) of at least 50.1% of the Purchase Options and/or the underlying Units
and/or the underlying securities (“Majority Holders”), agrees to
use its reasonable best efforts to register (the “Demand Registration”) under
the Securities Act on two occasions, all of the Purchase Options requested by
the Majority Holders in the Initial Demand Notice and all of the securities
underlying such Purchase Options, including the Units, Common Stock, the
Warrants and the Common Stock underlying the Warrants that are not capable of
being sold pursuant to Rule 144 or other exemption from registration without a
volume limitation (collectively, the “Registrable Securities”). On such occasion, the
Company will file a registration statement for use in an offering of the
Registrable Securities from time-to-time or a post-effective amendment to the
Registration Statement covering all of the Registrable Securities that will
permit an offering of the Registrable Securities from time-to-time and use its
reasonable best efforts to have such registration statement or post-effective
amendment filed and declared effective as soon as possible
thereafter.  The demand for registration may be made at any time
during a period of five years beginning on the Effective Date.  The
Initial Demand Notice shall specify the intended method(s) of distribution of
the Registrable Securities.  The Company will notify all holders of
the Purchase Options and/or Registrable Securities of the demand within ten days
from the date of the receipt of any such Initial Demand Notice.  Each
holder of Registrable Securities who wishes to include all or a portion of such
holder’s Registrable Securities in the Demand Registration (each such holder
including shares of Registrable Securities in such registration, a “Demanding Holder”) shall so
notify the Company within five (5) days after the receipt by the holder of the
notice from the Company and complete a selling shareholder
questionnaire.  Upon any such request, the Demanding Holders shall be
entitled to have their Registrable Securities included in the Demand
Registration, subject to Section 5.1.4.  The Company will then use its
reasonable best efforts (a) to prepare and file within sixty (60) days a new
registration statement or a post-effective amendment to the Registration
Statement covering the resale of the Registrable Securities which the Demanding
Holders have requested to be registered and (b) to cause such registration
statement to be declared effective as soon as possible
thereafter.

     

    5.1.2           Effective
Registration.  A registration will not count as a Demand
Registration until the registration statement filed with the Commission with
respect to such Demand Registration has been declared effective and the Company
has complied with all of its obligations under this Agreement with respect
thereto; provided, however, that
if, after such registration statement has been declared effective, the offering
of Registrable Securities pursuant to a Demand Registration is interfered with
by any stop order or injunction of the Commission or any other governmental
agency or court, the registration statement with respect to such Demand
Registration will be deemed not to have been declared effective unless and until
such stop order or injunction is removed, rescinded or otherwise
terminated.

     

    5.1.3           Underwritten
Offering.  If the Majority Holders so elect and such holders so
advise the Company as part of the Initial Demand Notice, the offering of all or
any portion of the Registrable Securities pursuant to such Demand Registration
shall be in the form of one underwritten offering.  All Demanding
Holders proposing to distribute their securities through such underwriting shall
enter into an underwriting agreement in customary form with the underwriter or
underwriters selected for such underwriting by the Majority
Holders.

    
      
         

      

      
        -5-

        
          

        

      

      
         

      

    

    5.1.4           Reduction of
Offering.  If the managing underwriter or underwriters for a
Demand Registration that is to be an underwritten offering advises the Company
and the Demanding Holders in writing that the dollar amount or number of shares
of Registrable Securities which the Demanding Holders desire to sell pursuant to
the underwritten offering, taken together with all other shares of Common Stock
or other securities which the Company desires to sell and the shares of Common
Stock, if any, as to which registration has been requested pursuant to written
contractual piggy-back registration rights held by other stockholders of the
Company who desire to sell, 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 such registration: (i) first, the Registrable
Securities as to which Demand Registration has been requested by the Demanding
Holders that want to participate in such underwritten offering (pro rata in
accordance with the number of shares that each such Person has requested be
included in such registration, regardless of the number of shares held by each
such Person (such proportion is referred to herein as “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 clauses (i) and (ii), the shares of Common Stock as to which
“piggy-back” registration has been requested by the holders thereof, Pro Rata,
that can be sold without exceeding the Maximum Number of Shares; and (iv)
fourth, to the extent that the Maximum Number of Shares have 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 arrangements with such persons and
that can be sold without exceeding the Maximum Number of Shares.

     

    5.1.5           Withdrawal.  If
a majority-in-interest of the Demanding Holders disapprove of the terms of any
underwriting or are not entitled to include all of their Registrable Securities
in any offering, such majority-in-interest of the Demanding Holders may elect to
withdraw from such offering by giving written notice to the Company and the
underwriter or underwriters of their request to withdraw prior to the initial
filing of the registration statement filed with the Commission with respect to
such Demand Registration.  If the majority-in-interest of the
Demanding Holders withdraws from a proposed offering relating to a Demand
Registration prior to such initial filing, then such registration shall not
count as a Demand Registration provided for in Section 5.1, provided that the
majority-in-interest of the Demanding Holders electing to so withdraw from the
offering pays all reasonable costs and expenses incurred by the Company in
connection with such withdrawn Demand Registration.

     

    5.1.6           Terms.  The
Company shall bear all fees and expenses attendant to registering the
Registrable Securities, pursuant
to one Demand Registration and all Piggy Back Registrations (as defined
below), but the Holders shall pay any and all underwriting
commissions.  The Company agrees to use its reasonable best efforts to
qualify or register the Registrable Securities in such states as are reasonably
requested by the Majority Holder(s); provided, however, that in no event shall
the Company be required to register the Registrable Securities in a state in
which such registration would cause (i) the Company to be obligated to qualify
to do business in such state, or would subject the Company to taxation as a
foreign corporation doing business in such jurisdiction or (ii) the principal
stockholders of the Company to be obligated to escrow their shares of capital
stock of the Company.  The Company shall use its reasonable best
efforts to cause any registration statement or post-effective amendment filed
pursuant to the demand rights granted under Section 5.1.1 to remain effective
until the expiration of the Warrants in accordance with the terms and conditions
of that certain Warrant Agreement, dated as of _______, 2010, between the
Company and Continental Stock Transfer & Trust Company (the “Warrant Agreement”) or until
such earlier time as the shares issuable underlying the Warrants may be sold
pursuant to an exemption from such registration.

    
      
         

      

      
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    5.1.7           Permitted
Delays.  The Company shall be entitled to postpone the filing
of any registration statement under this Section 5.1, if (a) at any time prior
to the filing of such registration statement the Company’s Board of Directors
determines, in its good faith business judgment, that such registration and
offering would materially and adversely affect any financing, acquisition,
corporate reorganization, or other material transaction involving the Company,
and (b) the Company delivers to the Demanding Holders written notice thereof
within five (5) business days of the date of receipt by the Company of a request
for Demand Registration; provided that all such periods of postponement may not
exceed 45 days during any 365 day period.

     

    5.2          “Piggy-Back”
Registration.

     

    5.2.1           Piggy-Back
Rights.  If at any time during the seven (7) year period
commencing on the Effective Date the Company proposes to file a registration
statement under the Securities Act with respect to an offering of equity
securities, or securities or other obligations exercisable or exchangeable for,
or convertible into, equity securities, by the Company for its own account or
for stockholders of the Company for their account (or by the Company and by
stockholders of the Company including, without limitation, pursuant to Section
5.1), other than a registration statement (i) filed in connection with any
employee stock option or other benefit plan, (ii) for an exchange offer or
offering of securities solely to the Company’s existing stockholders, (iii) for
an offering of debt that is convertible into equity securities of the Company,
(iv) on Form S-4 filed in connection with an acquisition transaction or (v) for
a dividend reinvestment plan, then the Company shall (x) give written notice of
such proposed filing to the holders of Registrable Securities as soon as
practicable but in no event less than ten (10) days before the anticipated
filing date, which notice shall describe the amount and type of securities to be
included in such offering, the intended method(s) of distribution, and the name
of the proposed managing underwriter or underwriters, if any, of the offering,
and (y) offer to the holders of Registrable Securities in such notice the
opportunity to register the sale of such number of shares of Registrable
Securities as such holders may request in writing within five (5) days following
receipt of such notice (a “Piggy-Back
Registration”).  The Company shall cause such Registrable
Securities to be included in such registration and shall use reasonable best
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.

     

    5.2.2           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 of Registrable Securities in writing that the dollar
amount or number of shares of Common Stock which the 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 5.2, 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
stockholders of the Company, exceeds the Maximum Number of Shares, then the
Company shall include in any such registration:

    
      
         

      

      
        -7-

        
          

        

      

      
         

      

    

     (a)           If
the registration is undertaken for the Company’s account: (A) 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; and (B) second, to the
extent that the Maximum Number of Shares has not been reached under the
foregoing clause (A), the shares of Common Stock or other securities, if any,
comprised of Registrable Securities, as to which registration has been requested
pursuant to the applicable written contractual piggy-back registration rights of
such security holders or for the account of other persons that the Company is
obligated to register pursuant to written contractual piggy-back registration
rights with such persons, Pro Rata, that can be sold without exceeding the
Maximum Number of Shares; and

     

     (b)           If
the registration is a “demand” registration undertaken at the demand of persons
other than the holders of Registrable Securities, (A) 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; (B) second, to the
extent that the Maximum Number of Shares has not been reached under the
foregoing clause (A), 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; and (C) third, to the extent that the Maximum Number of Shares has not
been reached under the foregoing clauses (A) and (B), collectively the shares of
Common Stock or other securities comprised of Registrable Securities, as to
which registration has been requested pursuant to the terms hereof, and/or 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
arrangements with such persons, Pro Rata, that can be sold without exceeding the
Maximum Number of Shares.

     

    5.2.3           Withdrawal.  Any
holder of Registrable Securities may elect to withdraw such holder’s request for
inclusion of Registrable Securities in any Piggy-Back Registration by giving
written notice to the Company of such request to withdraw prior to the
effectiveness of the registration statement.  The Company (whether on
its own determination or as the result of a withdrawal by persons making a
demand pursuant to written contractual obligations) may withdraw a registration
statement at any time prior to the effectiveness of the registration
statement.  Notwithstanding any such withdrawal, the Company shall pay
all expenses incurred by the holders of Registrable Securities in connection
with such Piggy-Back Registration as provided in Section 5.2.4.

     

    5.2.4           Maintenance
of Priority. Until such
time as the Company has registered the Registrable Securities, so long as there
are Registrable Securities hereunder, the Company shall not grant to any person
piggy-back rights superior to the rights of the Holders of Registrable
Securities hereunder.

    
      
         

      

      
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    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 Securities Act or
Section 20(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and any of
their respective heirs, successors, permitted assigns and transfers, and agents
and representatives, 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 Securities 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 8 of
the Underwriting Agreement between the Company and the Representatives, on their
own behalf and on behalf of other underwriters named therein, 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 Securities 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 Securities Act, the Exchange Act or otherwise, arising from
information furnished by or on behalf of such Holders, or their successors or
assigns, in writing, for specific inclusion in such registration statement to
the same extent and with the same effect as the provisions contained in Section
8 of the Underwriting Agreement pursuant to which the underwriters have agreed
to indemnify the Company.

     

    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 the Holders participating
in an underwritten offering, 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 “comfort”
letter dated the effective date of such registration statement (and, if such
registration includes an underwritten public offering, a letter dated the date
of the closing under the underwriting agreement) signed by the independent
public accountants who have issued a report on the Company’s financial
statements included in such registration statement, in each case covering
substantially the same matters with respect to such registration statement (and
the prospectus included therein) and, in the case of such accountants’ letter,
with respect to events subsequent to the date of such financial statements, as
are customarily covered in opinions of issuer’s counsel and in accountants’
letters delivered to underwriters in underwritten public offerings of
securities.  The Company shall also deliver promptly to the Holders
participating in the offering, the correspondence and memoranda described below
and copies of all correspondence between the Commission and the Company, its
counsel or auditors and all memoranda relating to discussions with the
Commission or its staff with respect to the registration statement and permit
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 Financial Industry Regulatory Authority, Inc. (“FINRA”).  Such
investigation shall include access to books, records and properties and
opportunities to discuss the business of the Company with its officers and
independent auditors, all to such reasonable extent and at such reasonable times
and as often as the Holders, shall reasonably request.  The Company
shall not be required to disclose any confidential information or other records
to the Holders, or to any other person, until and unless such persons shall have
entered into reasonable confidentiality agreements (in form and substance
reasonably satisfactory to the Company), with the Company with respect
thereto.

    
      
         

      

      
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    5.3.4           Rule 144
Sale.  Notwithstanding anything contained in this Section 5 to
the contrary, the Company shall have no obligation pursuant to Sections 5.1 or
5.2 for the registration of Registrable Securities held by any Holder (i) where
such Holder would then be entitled to sell under 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 Registrable Securities held by such Holder, and
(ii) where the number of Registrable Securities held by such Holder is within
the volume limitations of Rule 144.

     

    5.3.5           Underwriting
Agreement. If an
underwritten offering is requested pursuant to Section 5.1, the Company shall
enter into an underwriting agreement with the managing underwriter(s), if any,
selected by any Holders, which managing underwriter shall be reasonably
acceptable to the Company. Such agreement shall be reasonably satisfactory in
form and substance to the Company, each participating Holder and such managing
underwriter(s), 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 participating Holders shall
be parties to any underwriting agreement relating to an underwritten sale of
their Registrable Securities and shall agree to such covenants and
indemnification and contribution obligations of selling securityholders as are
customarily contained in agreements of that type used by the managing
underwriter. Further, such Holders shall execute appropriate custody agreements
and otherwise cooperate fully in the preparation of the registration statement
and other documents relating to any offering in which they include Registrable
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.

     

    5.3.6           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.

    
      
         

      

      
        -10-

        
          

        

      

      
         

      

    

     

    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 6.3 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 $12.00 per whole Unit
(each Warrant underlying the Units is exercisable for $9.00 per share), upon
effectiveness of the dividend, this Purchase Option will be adjusted to allow
for the purchase of one Unit at $12.00 per Unit, each Unit entitling the holder
to receive two shares of Common Stock and two Warrants (each Warrant exercisable
for $4.50 per share).

     

    6.1.2           Extraordinary
Dividends.  If the Company, at any time while this Purchase
Option is outstanding and unexpired, 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 receivable upon exercise of the Purchase
Option), other than (i) as described in Sections 6.1.1, 6.1.3 or 6.1. 4, (ii)
regular quarterly or other periodic dividends, (iii) in connection with the
conversion rights of the holders of Common Stock upon consummation of the
Company’s initial Business Combination or (iv) 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 Exercise 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.

     

    6.1.3           Aggregation of
Shares.  If after the date hereof, and subject to the
provisions of Section 6.3, the number of outstanding shares of Common Stock is
decreased by a 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.

    
      
         

      

      
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    6.1.4           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 6.1.1 or 6.1.3 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 6.1.3, then such
adjustment shall be made pursuant to Sections 6.1.1, 6.1.3 and this Section
6.1.4.  The provisions of this Section 6.1.4 shall similarly apply to
successive reclassifications, reorganizations, mergers or consolidations, sales
or other transfers.

     

    6.1.5           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.

     

    6.1.6           Adjustments of
Warrants.  To the extent the price of the Warrants is lowered
pursuant to Section 3.1 of the Warrant Agreement, the price of the Warrants
underlying the Purchase Option shall be reduced on identical terms (except that
the Warrant Price (as defined in the Warrant Agreement) for the Warrants shall
always remain 110% of the Warrant Price for the Public Warrants), subject to any
limitations and conditions that may be imposed by FINRA pursuant to Rule 2710 of
the National Association of Securities Dealers, Inc. (the “NASD Conduct Rules”) and any
such reduction must remain in effect for at least twenty (20) business
days.  To the extent that the duration of the Warrants is extended
pursuant to Section 3.2 of the Warrant Agreement, the duration of the Warrants
underlying the Purchase Option shall be extended on identical terms, subject to
any limitations that may be imposed by FINRA pursuant to the NASD Conduct
Rules.

     

    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 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.

    
      
         

      

      
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    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 or
down 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 Options 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 Options 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 stockholder.  The Company further
covenants and agrees that upon exercise of the Warrants underlying the Purchase
Options 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 stockholder.  As long as the Purchase Options
shall be outstanding, the Company shall use its best efforts to cause all (i)
Units and shares of Common Stock issuable upon exercise of the Purchase Options,
(ii) Warrants issuable upon exercise of the Purchase Options 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 all securities exchanges (or, if applicable on the Nasdaq
Global Market, Nasdaq Capital Market, FINRA OTC Bulletin Board or any successor
trading market) on which the Units, the Common Stock or the Public Warrants 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 stockholder for the election of
directors or any other matter, or as having any rights whatsoever as a
stockholder of the Company.  If, however, at any time prior to the
expiration of the Purchase Options and their exercise, any of the events
described in Section 8.2 shall occur, then, in one or more of said events, the
Company shall give written notice of such event at least fifteen days prior to
the date fixed as a record date or the date of closing the transfer books for
the determination of the stockholders entitled to such dividend, distribution,
conversion or exchange of securities or subscription rights, or entitled to vote
on such proposed dissolution, liquidation, winding up or sale.  Such
notice shall specify such record date or the date of the closing of the transfer
books, as the case may be.  Notwithstanding the foregoing, the Company
shall deliver to each Holder a copy of each notice given to the other
stockholders of the Company at the same time and in the same manner that such
notice is given to the stockholders.

    
      
         

      

      
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    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 or a merger of the
Company wherein the separate existence of the Company shall cease 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 the change in Exercise Price and shall be certified as being true
and accurate by the Company’s President 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, mailed by express mail or
private courier service, or sent by facsimile transmission, with confirmation of
receipt: (i) If to the registered Holder of the Purchase Option, to the address
and/or fax number of such Holder as shown on the books of the Company, or (ii)
if to the Company, to the following address or fax number or to such other
address or and fax number as the Company may designate by notice to the
Holders:

     

    SMG
Indium Resources Ltd.

    41
University Drive, Suite 400

    Newton,
Pennsylvania 18940

    Attn:  _______________________________________

    

    Sunrise
Securities Corp.

    641
Lexington Avenue, 25th
Floor

    New York,
NY 10022

    Attn:  ●

    

    and

     

    Rodman
& Renshaw, LLC

    1251
Avenue of the Americas, 20th
Floor

    New York,
New York 10020

    Attn:  ●

    
      
         

      

      
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    9.           Miscellaneous.

     

    9.1          Amendments.  The
Company 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 may deem necessary or
desirable and that the Company, in the exercise of reasonable judgment,
determines that it 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.

     

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

     

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

     

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

     

    9.5          Governing Law; Submission to
Jurisdiction.  This Purchase Option shall be governed by and
construed and enforced in accordance with the laws of the State of New York,
without giving effect to conflict of laws.  The Company 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 located in New York County or of the United States District
Court for the Southern District of New York, and irrevocably submits to such
jurisdiction, which jurisdiction shall be exclusive.  The Company
hereby waives any objection to such exclusive jurisdiction and that such courts
represent an inconvenient forum.  Any process or summons to be served
upon the Company may be served by transmitting a copy thereof by registered or
certified mail, return receipt requested, postage prepaid, addressed to it at
the address set forth in Section 8 hereof.  Such mailing shall be
deemed personal service and shall be legal and binding upon the Company in any
action, proceeding or claim.  The Company and the Holder agree that
the prevailing party(ies) in any such action shall be entitled to recover from
the other party(ies) all of its reasonable attorneys’ fees and expenses relating
to such action or proceeding and/or incurred in connection with the preparation
therefor.

    
      
         

      

      
        -15-

        
          

        

      

      
         

      

    

     

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

     

    9.7          Execution in
Counterparts.  This Purchase Option may be executed in one or
more counterparts, and by the different parties hereto in separate counterparts,
each of which shall be deemed to be an original, but all of which taken together
shall constitute one and the same agreement, and shall become effective when one
or more counterparts has been signed by each of the parties hereto and delivered
to each of the other parties hereto.

     

    9.8          Underlying
Warrants.  At any time after exercise by a Holder of this
Purchase Option, a Holder may exchange its Warrants (with an initial exercise
price of $____) for Public Warrants (with an initial exercise price of $___)
upon payment to the Company of the difference between the exercise price of its
Warrant and the exercise price of the Public Warrants.  Any such
Public Warrants and the Common Stock underlying such Public Warrants shall
constitute Registrable Securities.

    

    [Remainder
of Page Intentionally Left Blank]

    
      
         

      

      
        -16-

        
          

        

      

      
         

      

    

    IN WITNESS WHEREOF, the
Company has caused this Purchase Option to be signed by its duly authorized
officer as of the ___ day of _________, 2010.

    

    
      
        
          	
                  SMG
      INDIUM RESOURCES LTD.

                
	 
      
	
                  By:

                	 
      
	
                  Name:

                
	
                  Title:

                

        

      

    

    
      
         

      

      
        -17-

        
          

        

      

      
         

      

    

    Form to be used to exercise
Purchase Option

     

    SMG
Indium Resources Ltd.

    41
University Drive, Suite 400

    Newton,
Pennsylvania 18940

    Attn:
Chief Executive Officer

    

    Date:_________________,
201__

    

    The
undersigned hereby elects irrevocably to exercise all or a portion of the within
Purchase Option and to purchase ____ Units of SMG Indium Resources Ltd. 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” 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.

     

    NOTICE:
The signature to this exercise notice must correspond with the name as written
upon the face of the Purchase Option in every particular, without alteration or
any change whatever.

     

    
      
        
          
            
              	 
      
	
                      

                        Signature(s)
      Guaranteed:

                      

                    

            

          

        

      

    

     

    THE
SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM, PURSUANT TO S.E.C. RULE
17Ad-15).

     

    
      INSTRUCTIONS
FOR REGISTRATION OF SECURITIES

       

    

    
      
        
          
            
              
                
                  
                    	 
      
	
                            Name

                          
	 
      
	 
      
	
                            (Print
      in Block Letters)

                          
	 
      
	 
      
	 
      
	
                            Address

                          

                  

                

              

            

          

        

      

    

    
      
         

      

      
        -18-

        
          

        

      

      
         

      

    

    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 SMG Indium Resources Ltd.  (the “Company”) evidenced by the
within Purchase Option and does hereby authorize the Company to transfer such
right on the books of the Company.

    

    Dated:___________________,
201_

    

    
      
        
          	 
      
	
                  Signature

                

        

      

    

    

    NOTICE:
The signature to this assignment must correspond with the name as written upon
the face of the Purchase Option in every particular, without alteration or any
change whatever.

     

    
      
        
          	 
      
	
                  Signature(s)
      Guaranteed:

                

        

      

    

    

    THE
SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM, PURSUANT TO S.E.C. RULE
17Ad-15).

    
      
         

      

      
        -19-

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