Document:

Filed by Avantafile.com - Biomass Secure Power Inc. - Exhibit 10.2

 

 

______
Settlement Agreement

By and between

Brian Holden 

and 

Biomass Secure Power Inc. 

______

Dated August 10, 2010

______ 

         Settlement Agreement, dated
this 10th day of August 2010, by and between Brian Holden, 7833
Turtle Cove Avenue, Las Vegas Nevada 89128, (”Holden”) and Biomass Secure Power
Inc., 40218 Wellsline Road. Abbotsford, BC V3G 2K7, Canada (“Biomass”), each
hereinafter referred to as a “Party,”and collectively as the “Parties.”
______

         Whereas, certain disputes have arisen between
the Parties, and

         Whereas, the Parties now wish in good faith
to make a final settlements of all disputes to date, and

         Whereas, Michelle Snook, wife of Holden
currently owns One Million (1,000,000) shares of the Common Stock of Biomass
(the “Snook Shares”), and 

         Whereas, Holden currently owns approximately
Five Million, Eight Hundred Thousand (5,800,000) shares of the Common Stock of
Biomass, more or less, (the “Holden Shares”), 

         Now, Therefore, for a valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the Parties agree as
follows: 

Article I 
Exchange of Securities

         Section 1.1. Holden Shares. Upon
signing of this Agreement, Biomass will order Computershare Trust Company of
Canada, Inc., transfer agent for Biomass, to lift any restrictions on Four
Million (4,000,000) of the Holden Shares and Biomass will take any and all such
action as is necessary for Holden to sell such Holden shares without
restriction, and refrain from taking any action which would inhibit or
interfere in any with Holden's ownership and sale of such Holden Shares.
Biomass will send Holden a copy of such instructions to the transfer agent. 

         When Holden receives the copy of such
instruction, he shall immediately send such 4,000,000 Holden shares to the
transfer agent and take all necessary steps to have any restriction lifted on
such shares. 

         Section 1.2. Snook and Holden Shares for
Biomass. When Holden confirms with said transfer agent that all
restrictions on 4,000,000 of the Holden Shares have been lifted, he will
promptly cause to be conveyed and delivered to Biomass the Snook shares and
another One Million, Eight Hundred Thousand (1,800,000) of the Holden Shares
with executed stock powers for the Snook Shares and said 1,800,000 Holden
Shares and any other necessary documentation necessary to transfer the Snook
Shares and 1,800,000 Holden Shares to Biomass free and clear of any liens and
encumbrances. 

Article II
No Derogatory Statements

         

         Section 2.1. Derogatory
Statements. The Parties hereby agree not to make any further derogatory
statements regarding the other Party and his or its past conduct or condition.
The Parties agree to withdraw, insofar as is reasonably practicable, all such
previous statements. 

Article III 
General Release 

Section 3.1. Mutual General Release. The
Parties hereby release and forever discharge the "Releasees"
hereunder, consisting of Holden and Biomass, and each of their partners,
subsidiaries, associates, affiliates, successors, heirs, assigns, agents,
directors, officers, employees, representatives, lawyers, insurers, and all
persons acting by, through, under or in concert with them, or any of them, of
and from any and all manner of action or actions, cause or causes of action, in
law or in equity, suits, debts, liens, contracts, agreements, promises,
liability, claims, demands, damages, losses, costs, attorneys' fees or
expenses, of any nature whatsoever, known or unknown, fixed or contingent
(hereinafter called "Claims"), which the undersigned now has or may
hereafter have against the Releasees, or any of them, by reason of any matter,
cause, or thing whatsoever from the beginning of time to the date hereof. The
Claims released herein include, without limiting the generality of the
foregoing, any Claims in any way arising out of, based upon, or related to the
employment or termination of employment of the undersigned by the Releasees, or
any of them; any alleged breach of any express or implied contracts; any
alleged torts or other alleged legal rights. 

THE UNDERSIGNED ACKNOWLEDGES THAT HE HAS
BEEN ADVISED BY LEGAL COUNSEL AND IS FAMILIAR WITH THE PROVISIONS OF RELEVANT
LAW, WHICH PROVIDES GENERALLY AS FOLLOWS:

A GENERAL RELEASE DOES NOT EXTEND TO
CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE
IME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY
AFFECTED HIS SETTLEMENT WITH THE DEBTOR.

THE UNDERSIGNED, BEING AWARE OF SAID
LAW, HEREBY EXPRESSLY WAIVES ANY RIGHTS HE MAY HAVE THEREUNDER, AS WELL AS
UNDER ANY OTHER STATUTES OR COMMON LAW PRINCIPLES OF SIMILAR EFFECT.

THE UNDERSIGNED IS HEREBY ADVISED THAT
HE OR IT HAS THE RIGHT TO CONSULT WITH AN ATTORNEY BEFORE SIGNING THIS RELEASE;

The undersigned represents and warrants
that there has been no assignment or other transfer of any interest in any
Claim which he may have against Releasees, or any of them, and the undersigned
agrees to indemnify and hold Releasees, and each of them, harmless from any
liability, Claims, demands, damages, costs, expenses and attorneys' fees incurred
by Releasees, or any of them, as the result of any such assignment or transfer
or any rights or Claims under any such assignment or transfer. It is the
intention of the parties that this indemnity does not require payment as a
condition precedent to recovery by the Releasees against the undersigned under
this indemnity.

The undersigned agrees that if he
hereafter commences any suit arising out of, based upon, or relating to any of
the Claims released hereunder or in any manner asserts against Releasees, or
any of them, any of the Claims released hereunder, then the undersigned agrees
to pay to Releasees, and each of them, in addition to any other damages caused
to Releasees thereby, all attorneys' fees incurred by Releasees in defending or
otherwise responding to said suit or Claim. 

The undersigned further understands and
agrees that neither the payment of any sum of money nor the execution of this
Release shall constitute or be construed as an admission of any liability
whatsoever by the Releasees, or any of them, who have consistently taken the
position that they have no liability whatsoever to the undersigned.

Article IV
Amendments and Notices

         Section
4.1. Amendments in Writing. No amendment or addition to this Agreement
shall be effective unless agreed to in writing by the Parties. All amendments
or additions will be executed in the form of an Addendum to this Agreement
constituting an integral part thereof. 

         Section
4.2. Notices. All notices or requests in connection with this Agreement
shall be in writing. Such notices may be sent by verified facsimile
transmission followed by registered or certified mail, or by registered or
certified mail. 

         Section
4.3. Addresses. For all official correspondence the Parties shall use
the addresses, phone and fax numbers of each other stipulated in this
Agreement. The Parties must promptly inform each other about all changes in
their addresses and telecommunication numbers.

Article V
Miscellaneous

         Section
5.1.  Waiver. The waiver by a Party of a breach of any provision of this
Agreement by the other shall not operate or be construed as a waiver of any
subsequent breach by a Party. All waivers must be express, in writing, and
signed. All waivers will be strictly construed.

         Section
5.2. Rights and Obligations.  The rights and obligations of a Party
under this Agreement shall inure to the benefit of and shall be binding upon a
Party's employees, directors, officers, agents, affiliates, associates,
successors and assigns.

         Section
5.3. Jurisdiction. The Parties agree that the jurisdiction of this
Agreement is in the State of Florida, United States of America. 

         Section
5.4. Disputes. Disputes under this Agreement shall be submitted to
binding arbitration by the American Arbitration Association in Tampa, Florida
in English. A Party shall be entitled to enforce any of the provisions of this
Agreement by court order without posting bond. 

         Section
5.5. Modifications. All waivers or modifications of this Agreement must
be in writing and signed by all Parties.

         Section
5.8. Further Assurances. The Parties will execute such further documents
and action necessary or appropriate to carry out the purposes of this
Agreement.

         Section
5.9. Integration.  This Agreement replaces all written or oral prior
agreements about the subject matter between the Parties.

         IN
WITNESS WHEREOF, the Parties hereto, by their respective officers duly
authorized, have caused this Agreement to be duly executed and delivered as of
the date first above written.

/s/
Brian Holden                               
Brian
Holden

Biomass
Secure Power, Inc. 

By    
/s/ Jim Carroll                        
         Jim
Carroll, CEOEXECUTION - Warrant Agreement  (00137408.DOC;15)

Execution Version

WARRANT AGREEMENT

This WARRANT AGREEMENT (the “Agreement”) is made as of December 9, 2010 between FLATWORLD ACQUISITION CORP., a British Virgin Islands business company organized with limited liability (the “Company”) and Continental Stock Transfer & Trust Company, a New York corporation, with offices at 17 Battery Place, New York, New York 10004 (“Warrant Agent”).

WHEREAS, pursuant to that certain Warrant Subscription Agreement dated as of July 9, 2010, as amended on October 8, 2010, November 9, 2010, December 6, 2010 and December 9, 2010 (the “Subscription Agreement”), the Company has received a binding commitment from FlatWorld Holdings Limited, a British Virgin Islands business company organized with limited liability owned by certain of our officers, directors, advisers, their respective affiliates and certain non-affiliates (the “Sponsor”), to purchase an aggregate of 2,000,000 Warrants (“Sponsor Warrants”) contemporaneously with the consummation of the Public Offering (defined below); and 

WHEREAS, the Company is engaged in a public offering (“Public Offering”) of units, each unit comprised of one Ordinary Share (as defined below) and one Public Warrant (as defined below) (the “Units”) and, in connection therewith, has determined to issue and deliver (i) up to 2,530,000 Warrants to public investors (“Public Warrants”) and (ii) up to 88,000 Warrants (the “Representative Warrants” and, together with the Public Warrants and the Sponsor Warrants, the “Warrants”) to Rodman & Renshaw, LLC, as representative of the underwriters (the “Representative”) as part of the Representative’s Units which may be exercised in whole or in part as provided in that certain Unit Purchase Option by and between the Company and the Representative, each of such Warrants evidencing the right of the holder thereof to purchase one Ordinary Share, no par value per share (“Ordinary Shares”), for $11.00, subject to adjustment as described herein; and

WHEREAS, the Company has filed with the Securities and Exchange Commission (the “SEC”) a Registration Statement on Form F-1, No. 333-169860 (as amended, the “Initial Registration Statement”) and a registration statement filed pursuant to Rule 462(b) on Form F-1, No. 333-171090 (collectively with the Initial Registration Statement, the “Registration Statements”), for the registration, under the Securities Act of 1933, as amended (the “Act”) of, among other securities, the Warrants and the Ordinary Shares issuable upon exercise of the Warrants which was declared effective on December 9, 2010 (the “Effective Date”); and

WHEREAS, the Company desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing to so act, in connection with the issuance, registration, transfer, exchange, redemption and exercise of the Warrants; and

 

WHEREAS, the Company desires to provide for the form and provisions of the Warrants, the terms upon which they shall be issued and exercised, and the respective rights, limitation of rights, and immunities of the Company, the Warrant Agent, and the holders of the Warrants; and

WHEREAS, all acts and things have been done and performed which are necessary to make the Warrants, when executed on behalf of the Company and countersigned by or on behalf of the Warrant Agent, as provided herein, the valid, binding and legal obligations of the Company, and to authorize the execution and delivery of this Agreement.

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

1.

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

2.

Warrants.

2.1.

Form of Warrant.  Each Warrant shall be issued in registered form only, shall be in substantially the form of Exhibit A hereto, the provisions of which are incorporated herein and shall be signed by, or bear the facsimile signature of, the Chairman of the Board, Chief Executive Officer or President and 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.

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

2.3.

Registration.  

2.3.1.

Warrant Register.  The Warrant Agent shall maintain books (“Warrant Register”), for the registration of original issuance and the registration of transfer of the Warrants.  Upon the initial issuance of the Warrants, the Warrant Agent shall issue and register the Warrants in the names of the respective holders thereof in such denominations and otherwise in accordance with instructions delivered to the Warrant Agent by the Company.

2.3.2.

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

2.4.

Detachability of Warrants.  The securities comprising the Units will trade separately (the “Detachment Date”) on the tenth business day following the earlier to occur of: (i) the expiration of the underwriters’ over-allotment option (which is 45 days from the Effective Date) (the “Over-allotment Option”), (ii) the exercise in full of the Over-allotment Option or (iii) the announcement of the underwriters’ intention not to exercise all or any remaining portion of the Over-allotment Option.  In no event will separate trading of the securities comprising the Units commence until (x) the Company files with the SEC a Current Report on Form 6-K, which includes an audited balance sheet reflecting the receipt by the Company of the gross proceeds of the sale of the Private Warrants and the Public Offering, including the proceeds received by the Company from the exercise of the Over-allotment Option, if the Over-allotment Option is exercised and closes on the date the Public Offering is consummated and (y) the Company issues a press release and files with the SEC a Current Report on Form 6-K announcing when such separate trading will begin.

 

2.5

Warrant Attributes.  

2.5.1

Sponsor Warrants.  The Sponsor Warrants will be issued in the same form as the Public Warrants but they (i) will not be transferable or salable until 30 days after the Company completes an acquisition, share exchange, share reconstruction and amalgamation or contractual control arrangement with, purchase of all or substantially all of the assets of, or any other similar business transactions with operating businesses or assets (a “Business Transaction”), (ii) will be exercisable on a cashless basis so long as they are held by the Sponsor or its affiliates, (iii) will not be redeemable by the Company so long as they are held by the Sponsor or its affiliates and (iv) may be exercised for unregistered shares if a registration statement relating to the Ordinary Shares issuable upon exercise of the Warrants is not effective and current, subject to Section 3.3.2 (ii) herein.

2.5.2.

Representative’s Warrants.  The Representative’s Warrants shall have the same terms and be in the same form as the Public Warrants; provided, however, the Representative’s Warrants shall expire on the fifth anniversary of the Effective Date.

3.

Terms and Exercise of Warrants.

3.1.

Warrant Price.  Each Warrant shall, when countersigned by the Warrant Agent, entitle the registered holder thereof, subject to the provisions of such Warrant and of this Warrant Agreement, to purchase from the Company the number of Ordinary Shares stated therein, at the price of $11.00 per whole share, subject to the adjustments provided in Section 4 hereof and in the last sentence of this Section 3.1.  The term “Warrant Price” as used in this Warrant Agreement refers to the price per share at which Ordinary Shares may be purchased at the time a Warrant is exercised.  The Company in its sole discretion may lower the Warrant Price at any time prior to the Expiration Date for a period of not less than twenty (20) business days, provided that any such reduction shall be identical among all of the Warrants.

  

3.2.

Duration of Warrants.  A Warrant may be exercised only during the period commencing on the later of: (i) 30 days following the consummation of a Business Transaction or (ii) December 9, 2011 (one year from the Effective Date), and terminating at 5:00 P.M., New York City time on the earlier to occur of (x) five years from the consummation of the Business Transaction; (ii) at 11:59 P.M. New York City time on that date which is 21 months from the Effective Date if no Business Transaction is consummated by such date; or (iii) the Redemption Date as provided in Section 6.2 of this Agreement (as applicable, the “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, the Company will provide notice to registered holders of the Warrants of such extension of not less than twenty (20) days and, further provided that any such extension shall be identical in duration among all of the Warrants.    

3.3.

Exercise of Warrants.

3.3.1.

Payment.  Subject to the provisions of the Warrant and this Warrant Agreement,  a Warrant, when countersigned by the Warrant Agent, may be exercised by the registered holder thereof by surrendering it, at the office of the Warrant Agent, or at the office of its successor as Warrant Agent, in the Borough of Manhattan, City and State of New York, with the subscription form, as set forth in the Warrant, duly executed, and by paying in full the Warrant Price for each full share of Ordinary Shares 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 Ordinary Shares and the issuance of such Ordinary Shares, as follows:

(a)

in lawful money of the United States, good certified check or good bank draft payable to the order of the Warrant Agent;

(b)

in the event of redemption pursuant to Section 6 hereof in which the Company’s management has elected to force all holders of Warrants to exercise such Warrants on a “cashless basis,” by surrendering the Warrants for: that number of Ordinary Shares equal to the quotient obtained by dividing (x) the product of the number of Ordinary Shares underlying the Warrants, multiplied by the difference between the Warrant Price and the “Fair Market Value” (defined below) by (y) the Fair Market Value. Solely for purposes of this Section 3.3.1(b), the “Fair Market Value” means the volume weighted average price of the Ordinary Shares as reported by Bloomberg for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to holders of Warrants pursuant to Section 6 hereof; or

 

(c)

with respect to any Sponsor Warrants, so long as such Sponsor Warrants are held by the Sponsor or its affiliates, by surrendering the Warrants for: that number of Ordinary Shares equal to the quotient obtained by dividing (x) the product of the number of Ordinary Shares underlying the Warrants, multiplied by the difference between the Warrant Price and the “Fair Market Value” (defined below) by (y) the Fair Market Value. Solely for purposes of this Section 3.3.1(c), the “Fair Market Value” means the volume weighted average price of the Ordinary Shares as reported by Bloomberg for the 10 trading days ending on the trading day prior to the date of exercise.

3.3.2.

Issuance of Certificates.  As soon as practicable after the exercise of any Warrant and the clearance of the funds in payment of the Warrant Price (if cash is paid), the Company shall issue to the registered holder of such Warrant a certificate or certificates for the number of full Ordinary Shares to which he, 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.  Notwithstanding the foregoing, the Company shall not be obligated to deliver any securities pursuant to the exercise of a Warrant and shall have no obligation to settle such Warrant exercise unless: (i) a registration statement under the Act with respect to the Ordinary Shares underlying the Public Warrants is effective, subject to the Company’s satisfying its obligations under Section 7.4 or (ii) solely with respect to Sponsor Warrants, in the opinion of counsel to the Company, the exercise of the Warrants is exempt from the registration requirements of the Act and such securities are qualified for sale or exempt from qualification under applicable securities laws of the states or other jurisdictions in which the registered holders reside. In the event that a registration statement with respect to the Ordinary Shares underlying a Public Warrant is not effective under the Act, the holder of such Public Warrant shall not be entitled to exercise such Warrant and such Warrant may have no value and expire worthless. In no event will the Company be required to net cash settle the Warrant exercise.  Warrants may not be exercised by, or securities issued to, any registered holder in any state in which such exercise would be unlawful. In the event that a registration statement is not effective for the exercised Public Warrants the purchaser of a Unit containing such Warrants will have paid the full purchase price for the Unit solely for the Ordinary Shares included in such Unit. 

 

3.3.3.

Valid Issuance.  All Ordinary Shares issued upon the proper exercise of a Warrant in conformity with this Agreement shall be validly issued, fully paid and nonassessable.

3.3.4.

Date of Issuance.  Each person in whose name any such certificate for Ordinary Shares is issued shall for all purposes be deemed to have become the holder of record of such shares on the date on which the Warrant was surrendered and payment of the Warrant Price was made, irrespective of the date of delivery of such certificate, except that, if the date of such surrender and payment is a date when the share transfer books of the Company are closed, such person shall be deemed to have become the holder of such shares at the close of business on the next succeeding date on which the share transfer books are open.

3.3.5. 

  Maximum Percentage. A holder of a Warrant may notify the Company in writing in the event it elects to be subject to the provisions contained in this subsection 3.3.5; however, no holder of a Warrant shall be subject to this subsection 3.3.5 unless he, she or it makes such election. If the election is made by a holder, upon seeking exercise of such holder’s Warrant pursuant to subsection 3.3.1, the holder shall also represent to the Warrant Agent the number of Ordinary Shares beneficially owned by such person (together with such person’s affiliates) and the Warrant Agent shall not effect the exercise of the holder’s Warrant, and such holder shall not have the right to exercise such Warrant, to the extent that after giving effect to such exercise, such person (together with such person’s affiliates), to the Warrant Agent’s actual knowledge, would beneficially own in excess of 9.8% (the “Maximum Percentage”) of the Ordinary Shares outstanding immediately after giving effect to such exercise. For purposes of the foregoing sentence, the aggregate number of Ordinary Shares beneficially owned by such person and its affiliates shall include the number of Ordinary Shares issuable upon exercise of the Warrant with respect to which the determination of such sentence is being made, but shall exclude Ordinary Shares that would be issuable upon (x) exercise of the remaining, unexercised portion of the Warrant beneficially owned by such person and its affiliates and (y) exercise or conversion of the unexercised or unconverted portion of any other securities of the Company beneficially owned by such person and its affiliates (including, without limitation, any convertible notes or convertible preferred stock or warrants) subject to a limitation on conversion or exercise analogous to the limitation contained herein. Except as set forth in the preceding sentence, for purposes of this paragraph, beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). For purposes of the Warrant, in determining the number of outstanding Ordinary Shares, the holder may rely on the number of outstanding Ordinary Shares as reflected in (1) the Company’s most recent Form 10-K (or 20-F), Form 10-Q (or 6-K), current report on Form 8-K (or 6-K) or other public filing with the Commission (and any foreign equivalents pursuant to the foreign private issuer rules of the Exchange Act) as the case may be, (2) a more recent public announcement by the Company or (3) any other notice by the Company or the Company’s transfer agent setting forth the number of Ordinary Shares outstanding. For any reason at any time, upon the written request of the holder of the Warrant, the Company shall, within two (2) Business Days, confirm in writing to such holder the number of Ordinary Shares then outstanding. In any case, the number of outstanding Ordinary Shares shall be determined after giving effect to the conversion or exercise of equity securities of the Company by the holder and its affiliates since the date as of which such number of outstanding Ordinary Shares was reported. By written notice to the Company, the holder of a Warrant may from time to time increase or decrease the Maximum Percentage applicable to such holder to any other percentage specified in such notice; provided, however, that any such change shall not be effective until the sixty-first (61st) day after such notice is delivered to the Company.  For the purposes of this Agreement, a “Business Day” means any day on which federally chartered retail banks are typically open for business in New York, New York.

 

4.

Adjustments.

4.1.1 

  Split-Ups. If after the date hereof, and subject to the provisions of Section 4.6 below, the number of outstanding Ordinary Shares is increased by a share dividend payable in Ordinary Shares, or by a split-up of Ordinary Shares or other similar event, then, on the effective date of such share dividend, split-up or similar event, the number of Ordinary Shares issuable on exercise of each Warrant shall be increased in proportion to such increase in the outstanding Ordinary Shares. A rights offering to all holders of the Ordinary Shares entitling holders to purchase Ordinary Shares at a price less than the “Fair Market Value” (as defined below) shall be deemed a share dividend of a number of Ordinary Shares equal to the product of (i) the number of Ordinary Shares actually sold in such rights offering (or issuable under any other equity securities actually sold in such rights offering that are convertible into or exercisable for the Ordinary Shares) multiplied by (ii) the quotient of (x) the Fair Market Value less the price per share of the Ordinary Shares paid in such rights offering divided by (y) the Fair Market Value. For purposes of this subsection 4.1.1, (i) if the rights offering is for securities convertible into or exercisable for the Ordinary Shares, in determining the price payable for the Ordinary Shares, there shall be taken into account any consideration received for such rights, as well as any additional amount payable upon exercise or conversion and (ii) “Fair Market Value” means the volume weighted average price of the Ordinary Shares as reported by Bloomberg for the ten (10) trading day period ending on the trading day prior to the first date on which the Ordinary Shares trade on the applicable exchange or in the applicable market, regular way, without the right to receive such rights.

4.1.2

Extraordinary Dividends. If the Company, at any time while the Warrants are outstanding and unexpired, shall pay a dividend or make a distribution in cash, securities or other assets to the holders of the Ordinary Shares on account of such Ordinary Shares (or other shares of the Company’s capital stock into which the Warrants are convertible), other than (a) as described in subsection 4.1.1 above, (b) Ordinary Cash Dividends (as defined below), (c) to satisfy the redemption rights of the holders of the Ordinary Shares in connection with a proposed initial Business Transaction, (d) as a result of the repurchase of Ordinary Shares by the Company if a proposed initial Business Transaction is presented to the shareholders of the Company for approval or (e) in connection with the redemption of the Company’s shareholders or liquidation and the distribution of its assets upon its failure to consummate a Business Transaction (any such non-excluded event being referred to herein as an “Extraordinary Dividend”), then the Warrant Price shall be decreased, effective immediately after the effective date of such  

 

Extraordinary Dividend, by the amount of cash and the fair market value (as determined by the Company’s board of directors, in good faith) of any securities or other assets paid on each share of the Ordinary Shares in respect of such Extraordinary Dividend. For purposes of this subsection 4.1.2, “Ordinary Cash Dividends” means any cash dividend or cash distribution which, when combined on a per share of the Ordinary Shares basis, with the per share amounts of all other cash dividends and cash distributions paid on the Ordinary Shares during the 365-day period ending on the date of declaration of such dividend or distribution (as adjusted to appropriately reflect any of the events referred to in other subsections of this Section 4 and excluding cash dividends or cash distributions that resulted in an adjustment to the Warrant Price or to the number of Ordinary Shares issuable on exercise of each Warrant) does not exceed $0.50 (being 5% of the offering price of the Units in the Offering).

4.2.

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

4.3

Adjustments in Warrant Price and Redemption Threshold.  Whenever the number of Ordinary Shares purchasable upon the exercise of the Warrants is adjusted, as provided in subsection 4.1.1 and 4.2 above, the Warrant Price shall be adjusted (to the nearest cent) by multiplying such Warrant Price immediately prior to such adjustment by a fraction (x) the numerator of which shall be the number of Ordinary Shares purchasable upon the exercise of the Warrants immediately prior to such adjustment, and (y) the denominator of which shall be the number of Ordinary Shares so purchasable immediately thereafter.  Whenever the Warrant Price is adjusted, the Redemption Threshold (defined in subsection 6.1) shall be adjusted to equal 150% of the Warrant Price.

4.4. 

  Replacement of Securities upon Reorganization, etc. Subject to Section 7.5, in case of any reclassification or reorganization of the outstanding Ordinary Shares (other than a change under subsections 4.1.1 or 4.1.2 or Section 4.2 hereof or that solely affects the par value of such Ordinary Shares), or in the case of any merger or consolidation of the Company with or into another corporation (other than a consolidation or merger in which the Company is the continuing corporation and that does not result in any reclassification or reorganization of the outstanding Ordinary Shares), or in the case of any sale or conveyance to another corporation or entity of the assets or other property of the Company as an entirety or substantially as an entirety in connection with which the Company is dissolved, the holders of the Warrants shall thereafter have the right to purchase and receive, upon the basis and upon the terms and conditions specified in the Warrants and in lieu of the Ordinary Shares of the Company immediately theretofore purchasable and receivable upon the exercise of the rights represented thereby, the kind and amount of shares of stock or other securities or property (including cash) receivable  

 

upon such reclassification, reorganization, merger or consolidation, or upon a dissolution following any such sale or transfer, that the holder of the Warrants would have received if such holder had exercised his, her or its Warrant(s) immediately prior to such event (the “Alternative Issuance”); provided, however, that (i) if the holders of the Ordinary Shares were entitled to exercise a right of election as to the kind or amount of securities, cash or other assets receivable upon such consolidation or merger, then the kind and amount of securities, cash or other assets constituting the Alternative Issuance for which each Warrant shall become exercisable shall be deemed to be the weighted average of the kind and amount received per share by the holders of the Ordinary Shares in such consolidation or merger that affirmatively make such election, and (ii) if a tender, exchange or redemption offer shall have been made to and accepted by the holders of the Ordinary Shares (other than a tender, exchange or redemption offer made by the Company in connection with redemption rights held by shareholders of the Company as provided for in the Company’s memorandum and articles of association, as amended, or as a result of the repurchase of Ordinary Shares by the Company if a proposed initial Business Combination is presented to the shareholders of the Company for approval) under circumstances in which, upon completion of such tender or exchange offer, the maker thereof, together with members of any group (within the meaning of Rule 13d-5(b)(1) under the Exchange Act) of which such maker is a part, and together with any affiliate or associate of such maker (within the meaning of Rule 12b-2 under the Exchange Act) and any members of any such group of which any such affiliate or associate is a part, own beneficially (within the meaning of Rule 13d-3 under the Exchange Act) more than 50% of the outstanding Ordinary Shares, the holder of a Warrant shall be entitled to receive as the Alternative Issuance, the highest amount of cash, securities or other property to which such holder would actually have been entitled as a stockholder if such Warrant holder had exercised the Warrant prior to the expiration of such tender or exchange offer, accepted such offer and all of the Ordinary Shares held by such holder had been purchased pursuant to such tender or exchange offer, subject to adjustments (from and after the consummation of such tender or exchange offer) as nearly equivalent as possible to the adjustments provided for in this Section 4; provided further, however, that if less than 70% of the consideration (the “Public Share Percentage”) receivable by the holders of the Ordinary Shares in the applicable event is payable in the form of common stock in the successor entity that is listed for trading on a national securities exchange or on the OTC Bulletin Board, or is to be so listed for trading immediately following such event, then the Warrant Price shall be reduced by an amount (in dollars) equal to the quotient of: (x) the Redemption Threshold minus the Per Share Consideration (as defined below) (but in no event, less than zero) and (y) if the applicable event is announced on or prior to the third anniversary of the closing date of the initial Business Transaction, 2; if the applicable event is announced after the third anniversary of the closing date of the initial Business Transaction and on or prior to the fourth anniversary of the closing date of the initial Business Transaction, 2.5; if the applicable event is announced after the fourth anniversary of the closing date of the initial Business Transaction and on or prior to the Expiration Date, 3. “Per Share Consideration” means (i)
if the consideration paid to holders of the Ordinary Shares consists exclusively
of cash, the amount of such cash per share of the Ordinary Shares, and (ii) in
all other cases, the volume weighted average price of the Ordinary Shares as
reported by Bloomberg 

 

for the
ten (10) trading day period ending on the trading day prior to the effective
date of the applicable event. If any reclassification or reorganization also
results in a change in Ordinary Shares covered by subsections 4.1.1 or 4.2, then
such adjustment shall be made pursuant to subsections 4.1.1 or Sections 4.2, 4.3
and this Section 4.4. The provisions of this Section 4.4 shall similarly apply
to successive reclassifications, reorganizations, mergers or consolidations,
sales or other transfers.

4.5.

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

4.6.

No Fractional Shares.  Notwithstanding any provision contained in this Warrant Agreement to the contrary, the Company shall not issue fractional shares upon exercise of Warrants.  If, by reason of any adjustment made pursuant to this Section 4, the holder of any Warrant would be entitled, upon the exercise of such Warrant, to receive a fractional interest in a share, the Company shall, upon such exercise, round up to the nearest whole number, the number of the Ordinary Shares to be issued to the Warrant holder.

4.7.

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

5.

Transfer and Exchange of Warrants.

5.1.

Registration of Transfer.  The Warrant Agent shall register the transfer, from time to time, of any outstanding Warrant upon the Warrant Register, upon surrender of such Warrant for transfer, properly endorsed with signatures properly guaranteed and accompanied by appropriate instructions for transfer.  Upon any such transfer, a new Warrant representing an equal aggregate number of Warrants shall be issued and the old Warrant shall be cancelled by the Warrant Agent.  The Warrants so cancelled shall be delivered by the Warrant Agent to the Company from time to time upon request.

5.2.

Procedure for Surrender of Warrants.  Warrants may be surrendered to the Warrant Agent, together with a written request for exchange or transfer, and thereupon the Warrant Agent shall issue in exchange therefor one or more new Warrants as requested by the registered holder of the Warrants so surrendered, representing an equal aggregate number of Warrants; provided, however, that in the event that a Warrant surrendered for transfer bears a restrictive legend, the Warrant Agent shall not cancel such Warrant and issue new Warrants in exchange therefor until the Warrant Agent has received an opinion of counsel for the Company stating that such transfer may be made and indicating whether the new Warrants must also bear a restrictive legend.

5.3.

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

5.4.

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

5.5.

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

5.6

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 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 5.6 will have no further force and effect.  

5.7

Representative’s Units Lockup.  The Representative’s Warrants may be transferred in accordance with the terms hereof; provided, however, the Representative’s Units (and underlying Representative’s Warrants) are subject to a 180-day lock-up pursuant to Rule 5110(g)(1) of the FINRA Conduct Rules.  As a result, the Representative’s Units (and underlying Representative’s Warrants) may not be sold, transferred, assigned, pledged or hypothecated for 180 days following the effective date of the Registration Statements.

6.

Redemption.

6.1.

Redemption.  Subject to Sections 6.4 hereof, not less than all of the outstanding Warrants may be redeemed, at the option of the Company, at any time while they are exercisable and prior to their expiration, at the office of the Warrant Agent, upon the notice to the registered holders of the Warrants, as described in Section 6.2 below, at the price of $.01 per Warrant (“Redemption Price”), provided that the volume weighted average price of the Ordinary Shares as reported on Bloomberg has been at least $16.50  

 

per share (the “Redemption Threshold,” subject to adjustment in accordance with Section 4 hereof), on each of twenty (20) trading days within any thirty (30) trading day period ending on the third business day prior to the date on which notice of redemption is given, provided that there is an effective registration statement covering the Ordinary Shares underlying the Warrants for the continuous period beginning on the date on which notice is given and ending on the Redemption Date.  

6.2.

Date Fixed for, and Notice of, Redemption.  In the event the Company shall elect to redeem all of the Warrants, the Company shall fix a date for the redemption (the “Redemption Date”).  Notice of redemption shall be mailed by first class mail, postage prepaid, by the Company not less than 30 days prior to the Redemption Date to the registered holders of the Warrants to be redeemed at their last addresses as they shall appear on the registration books.  Any notice mailed in the manner herein provided shall be conclusively presumed to have been duly given whether or not the registered holder received such notice.

6.3.

Exercise After Notice of Redemption.  The Warrants may be exercised, for cash (or on a “cashless basis” in accordance with Section 3 of this Agreement) at any time after notice of redemption shall have been given by the Company pursuant to Section 6.2 hereof and prior to the Redemption Date.  In the event the Company determines to require all holders of Warrants to exercise their Warrants on a “cashless basis” pursuant to Section 3, the notice of redemption will contain the information necessary to calculate the number of shares Ordinary Shares to be received upon exercise of the Warrants, including the “Fair Market Value” in such case. On and after the Redemption Date, the record holder of the Warrants shall have no further rights except to receive, upon surrender of the Warrants, the Redemption Price.

6.4

Exclusion of Sponsor Warrants.  The Company understands that the redemption rights provided for by this Section 6 do not apply to the Sponsor Warrants if at the time of redemption such warrants continue to be held by the initial purchasers thereof or their permitted assigns.  However, once such Sponsor Warrants are transferred other than to any permitted assign, the Company may redeem the Sponsor Warrants, provided that the criteria for redemption are met, including the opportunity of the Warrant holder to exercise prior to redemption pursuant to Section 6.3.

7.

Other Provisions Relating to Rights of Holders of Warrants.

7.1.

No Rights as Shareholder.  A Warrant does not entitle the registered holder thereof to any of the rights of a shareholder of the Company, including, without limitation, the right to receive dividends, or other distributions, exercise any preemptive rights to vote or to consent or to receive notice as shareholders in respect of the meetings of shareholders or the election of directors of the Company or any other matter.

7.2.

Lost, Stolen, Mutilated, or Destroyed Warrants.  If any Warrant is lost, stolen, mutilated, or destroyed, the Company and the Warrant Agent may on such terms as to indemnity or otherwise as they may in their discretion impose (which shall, in the case of a mutilated Warrant, include the surrender thereof), issue a new Warrant of like denomination, tenor, and date as the Warrant so lost, stolen, mutilated, or destroyed.  Any such new Warrant shall constitute a substitute contractual obligation of the Company, whether or not the allegedly lost, stolen, mutilated, or destroyed Warrant shall be at any time enforceable by anyone.

 

7.3.

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

7.4.

Registration of the Ordinary Shares. The Company agrees that as soon as practicable, but in no event later than fifteen (15) Business Days after the closing of its initial Business Transaction, it shall use its best efforts to file with the Commission post-effective amendments to the Registration Statements, or a new registration statement, for the registration, under the Securities Act, of the Ordinary Shares issuable upon exercise of the Warrants, and it shall use its best efforts to take such action as is necessary to qualify for sale, in those states in which the Warrants were initially offered by the Company, the Ordinary Shares issuable upon exercise of the Warrants. The Company shall use its best efforts to cause the same to become effective and to maintain the effectiveness of such registration statement, and a current prospectus relating thereto, until the expiration of the Warrants in accordance with the provisions of this Agreement. If any such post-effective amendment or registration statement has not been declared effective by the 60th Business Day following the closing of the Business Transaction, holders of the Warrants shall have the right, during the period beginning on the 61st Business Day after the closing of the Business Transaction and ending upon such post-effective amendment or registration statement being declared effective by the Commission, and during any other period when the Company shall fail to have maintained an effective registration statement covering the Ordinary Shares issuable upon exercise of the Warrants, to exercise such Warrants on a “cashless basis,” by exchanging the Warrants (in accordance with Section 3(a)(9) of the Act or another exemption) for that number of Ordinary Shares equal to the quotient obtained by dividing (x) the product of the number of Ordinary Shares underlying the Warrants, multiplied by the difference between the Warrant Price and the “Fair Market Value” (as defined below) by (y) the Fair Market Value. Solely for purposes of this Section 7.4, “Fair Market Value” shall mean the volume weighted average price of the Ordinary Shares as reported on Bloomberg during the ten (10) trading day period ending on the trading day prior to the date that notice of exercise is received by the Warrant Agent from the holder of such Warrants or its securities broker or intermediary. The date that notice of cashless exercise is received by the Warrant Agent shall be conclusively determined by the Warrant Agent. The Company shall provide the Warrant Agent with an opinion of counsel for the Company (which shall be an outside law firm with securities law experience) stating that (i) the exercise of the Warrants on a cashless basis in accordance with this Section 7.4 is not required to be registered under the Securities Act and (ii) the Ordinary Shares issued upon such exercise shall be freely tradable under United States federal securities laws by anyone who is not an affiliate (as such term is defined in Rule 144 under the Securities Act) of the Company and, accordingly, shall not be required to bear a restrictive legend. For the avoidance of any doubt, unless and until all of the Warrants have been exercised on a cashless basis, the Company shall continue to be obligated to comply with its registration obligations under the first three sentences of this Section 7.4. In addition, the Company agrees to use its best efforts to register the Ordinary Shares issuable upon exercise of a Warrant under the blue sky laws of the states of residence of the exercising Warrant holder to the extent an exemption is not available.

 

7.5

Effect of Foreign Subsidiary.  In the event the Company elects to form a Foreign Subsidiary (as defined below) in connection with a proposed Business Transaction, the Foreign Subsidiary will assume the obligations of the Company, on the same terms and conditions as set forth in this Agreement, under all of the Warrants if the Company is liquidated or combined with the Foreign Subsidiary.  For the purposes hereof, “Foreign Subsidiary” means a foreign (non-U.S. and non-BVI) subsidiary the Company forms and utilizes to make the acquisition in connection with a proposed Business Transaction.

8.

Concerning the Warrant Agent and Other Matters.

8.1.

Payment of Taxes.  The Company will from time to time promptly pay all taxes and charges that may be imposed upon the Company or the Warrant Agent in respect of the issuance or delivery of Ordinary Shares upon the exercise of Warrants, but the Company shall not be obligated to pay any transfer taxes in respect of the Warrants or such shares.

8.2.

Resignation, Consolidation, or Merger of Warrant Agent.

8.2.1.

Appointment of Successor Warrant Agent.  The Warrant Agent, or any successor to it hereafter appointed, may resign its duties and be discharged from all further duties and liabilities hereunder after giving sixty (60) days’ notice in writing to the Company.  If the office of the Warrant Agent becomes vacant by resignation or incapacity to act or otherwise, the Company shall appoint in writing a successor Warrant Agent in place of the Warrant Agent.  If the Company shall fail to make such appointment within a period of 30 days after it has been notified in writing of such resignation or incapacity by the Warrant Agent or by the holder of the Warrant (who shall, with such notice, submit his Warrant for inspection by the Company), then the holder of any Warrant may apply to the Supreme Court of the State of New York for the County of New York for the appointment of a successor Warrant Agent at the Company’s cost.  Any successor Warrant Agent, whether appointed by the Company or by such court, shall be a corporation organized and existing under the laws of the State of New York, in good standing and having its principal office in the Borough of Manhattan, City and State of New York, and authorized under such laws to exercise corporate trust powers and subject to supervision or examination by federal or state authority.  After appointment, any successor Warrant Agent shall be vested with all the authority, powers, rights, immunities, duties, and obligations of its predecessor Warrant Agent with like effect as if originally named as Warrant Agent hereunder, without any further act or deed; but if for any reason it becomes necessary or appropriate, the predecessor Warrant Agent shall execute and deliver, at the expense of the Company, an instrument transferring to such successor Warrant Agent all the authority, powers, and rights of such predecessor Warrant Agent hereunder; and upon request of any successor Warrant Agent the Company shall make, execute, acknowledge, and deliver any and all instruments in writing for more fully and effectually vesting in and confirming to such successor Warrant Agent all such authority, powers, rights, immunities, duties, and obligations.

8.2.2.

Notice of Successor Warrant Agent.  In the event a successor Warrant Agent shall be appointed, the Company shall give notice thereof to the predecessor Warrant Agent and the transfer agent for the Ordinary Shares not later than the effective date of any such appointment.

8.2.3.

Merger or Consolidation of Warrant Agent.  Any corporation into which the Warrant Agent may be merged or with which it may be consolidated or any corporation resulting from any merger or consolidation to which the Warrant Agent shall be a party shall be the successor Warrant Agent under this Agreement without any further act.

8.3.

Fees and Expenses of Warrant Agent.

8.3.1.

Remuneration.  In connection with its services as Warrant Agent, the Company agrees to pay to the Warrant Agent the fee set forth on Schedule A to that certain Investment Management Trust Agreement by and between the Company and the Warrant Agent.

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 President, Chief Executive Officer or Chairman of the Board of the Company and delivered to the Warrant Agent.  The Warrant Agent may rely upon such statement for any action taken or suffered in good faith by it pursuant to the provisions of this Agreement.

8.4.2.

Indemnity.  The Warrant Agent shall be liable hereunder only for its own gross negligence, willful misconduct or bad faith.  The Company agrees to indemnify the Warrant Agent and save it harmless against any and all liabilities, including judgments, costs and reasonable counsel fees, for anything done or omitted by the Warrant Agent in the execution of this Agreement except as a result of the Warrant Agent’s gross negligence, willful misconduct, or bad faith.

 

 

8.4.3.

Exclusions.  The Warrant Agent shall have no responsibility with respect to the validity of this Agreement or with respect to the validity or execution of any Warrant (except its countersignature thereof); nor shall it be responsible for any breach by the Company of any covenant or condition contained in this Agreement or in any Warrant; nor shall it be responsible to make any adjustments required under the provisions of Section 4 hereof or responsible for the manner, method, or amount of any such adjustment or the ascertaining of the existence of facts that would require any such adjustment; nor shall it by any act hereunder be deemed to make any representation or warranty as to the authorization or reservation of any Ordinary Shares to be issued pursuant to this Agreement or any Warrant or as to whether any Ordinary Shares will when issued be valid and fully paid and nonassessable. 

8.5.

Acceptance of Agency.  The Warrant Agent hereby accepts the agency established by this Agreement and agrees to perform the same upon the terms and conditions herein set forth and among other things, shall account promptly to the Company with respect to Warrants exercised and concurrently account for, and pay to the Company, all moneys received by the Warrant Agent for the purchase of Ordinary Shares through the exercise of Warrants.

8.6

Waiver.  The Warrant Agent hereby waives any and all right, title, interest or claim of any kind (“Claim”) in or to any distribution of the Trust Account (as defined in that certain Investment Management Trust Agreement, dated as of the date hereof, by and between the Company and the Warrant Agent as trustee thereunder) and hereby agrees not to seek recourse, reimbursement, payment or satisfaction for any Claim against the Trust Account for any reason whatsoever. 

9.

Miscellaneous Provisions.

9.1.

Successors.  All the covenants and provisions of this Agreement by or for the benefit of the Company or the Warrant Agent shall bind and inure to the benefit of their respective successors and assigns.

9.2.

Notices.  Any notice, statement or demand authorized by this Warrant Agreement to be given or made by the Warrant Agent or by the holder of any Warrant to or on the Company shall be addressed, as follows:

 

FlatWorld Acquisition Corp.

c/o FlatWorld Capital LLC

220 East 42nd Street, 29th Floor

New York, NY  10017

Attn:  Chief Financial Officer

Fax No.:  (212)-796-4002

Any notice, statement or demand authorized by this Warrant Agreement to be given or made by the Warrant Agent or by the holder of any Warrant to or on the Company shall addressed as follows:

Continental Stock Transfer & Trust Company 

17 Battery Place

New York, New York 10004

Attn:  Compliance Department

in all cases, with a copy to (which shall not constitute notice):

FlatWorld Acquisition Corp.

Palm Grove House, Palm Grove Park

Road Town, Tortola, VG1110, British Virgin Islands

Attn:  Raj K. Gupta

and

Ellenoff Grossman & Schole LLP

150 East 42nd Street, 11th Floor

New York, New York 10017

Attn: Douglas S. Ellenoff, Esq.

Fax No: (212)-370-7889

All notices, statements or other documents which are required or contemplated by this Agreement shall be: (i) in writing and delivered personally or sent by first class registered or certified mail, overnight courier service or facsimile or electronic transmission to the address designated in writing, (ii) by facsimile to the number most recently provided to such party or such other address or fax number as may be designated in writing by such party and (iii) by electronic mail, to the electronic mail address most recently provided to such party or such other electronic mail address as may be designated in writing by such party.  Any notice or other communication so transmitted shall be deemed to have been given on the day of delivery, if delivered personally, on the business day following receipt of written confirmation, if sent by facsimile or electronic transmission, one (1) business day after delivery to an overnight courier service or five (5) days after mailing if sent by mail.

9.3.

Applicable Law.  The validity, interpretation, and performance of this Agreement and of the Warrants shall be governed in all respects by the laws of the State of New York, without giving effect to conflicts of law principles that would result in the application of the substantive laws of another jurisdiction.  The Company hereby agrees that any action, proceeding or claim against it arising out of or relating in any way to this Agreement shall be brought and enforced in the courts of the State of New York or the United States District Court for the Southern District of New York, and irrevocably submits to such jurisdiction, which jurisdiction shall be exclusive.  The Company hereby waives any objection to such exclusive jurisdiction and that such courts represent an inconvenience forum.  Any such process or summons to be served upon the Company may be served by transmitting a copy thereof by registered or certified mail, return receipt requested, postage prepaid, addressed to it at the address set forth in Section 9.2 hereof.  Such mailing shall be deemed personal service and shall be legal and binding upon the Company in any action, proceeding or claim.

 

9.4.

Persons Having Rights under this Agreement.  Nothing in this Agreement expressed and nothing that may be implied from any of the provisions hereof is intended, or shall be construed, to confer upon, or give to, any person or corporation other than the parties hereto and the registered holders of the Warrants, any right, remedy, or claim under or by reason of this Warrant Agreement or of any covenant, condition, stipulation, promise, or agreement 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 their successors and assigns and of the registered holders of the Warrants.

9.5.

Examination of the Warrant Agreement.  A copy of this Agreement shall be available at all reasonable times at the office of the Warrant Agent in the Borough of Manhattan, City and State of New York, for inspection by the registered holder of any Warrant.  The Warrant Agent may require any such holder to submit his Warrant for inspection by it.

9.6.

Counterparts.  This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same instrument.  Delivery of a signed counterpart of this Agreement by facsimile or electronic transmission shall constitute valid and sufficient delivery thereof.

9.7.

Effect of Headings.  The Section headings herein are for convenience only and are not part of this Warrant Agreement and shall not affect the interpretation thereof.

9.8

Amendments. This Agreement may be amended by the parties hereto without the consent of any registered holder for the purpose of curing any ambiguity, or curing, correcting or supplementing any defective provision contained herein or adding or changing any other provisions with respect to matters or questions arising under this Agreement as the parties may deem necessary or desirable and that the parties deem shall not adversely affect the interest of the registered holders. All other modifications or amendments, including any amendment to increase the Warrant Price or shorten the Exercise Period and any amendment to the terms of only the Sponsor Warrants, shall require the written consent of the registered holders of 65% of the then outstanding Public Warrants. Further, no Sponsor Warrants shall be voted in favor of such amendment unless the registered holders of 65% of the Public Warrants vote in favor of such amendment.  Notwithstanding the foregoing, the Company may lower the Warrant Price or extend the duration of the Exercise Period pursuant to Sections 3.1 and 3.2, respectively, without the consent of the registered holders.  The Warrant Agent may require an opinion of the Company’s counsel as to the validity of a proposed amendment as a condition of its execution of such amendment.

 

9.9

Severability.  This Warrant 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 Warrant 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 Warrant Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible and be valid and enforceable.

9.10

Mutual Drafting.  This Agreement is the joint product of the Warrant Agent and the Company and each provision hereof has been subject to the mutual consultation, negotiation and agreement of such parties and shall not be construed for or against any party hereto.

[Signature Page Follows]

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

FLATWORLD ACQUISITION CORP.

By:

/s/Jeffrey A. Valenty

  

    

                        Name:  Jeffrey A. Valenty

Title:    President

CONTINENTAL STOCK TRANSFER 

  & TRUST COMPANY

By:

/s/ John Comer

 

Name:  John Comer

Title:    Vice President

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