Document:

Unassociated Document

 

WARRANT AGREEMENT

 

SELWAY CAPITAL ACQUISITION CORPORATION

 

and

 

AMERICAN STOCK TRANSFER & TRUST COMPANY,

 

as Warrant Agent

 

Dated as of [●], 2011

  

  

  

Table of Contents

	  	  	
Page

	
SECTION 1. Appointment of Warrant Agent

	  	
1

	
SECTION 2. Warrant Certificates

	  	
1

	
SECTION 3. Execution of Warrant Certificates.

	  	
1

	
SECTION 4. Registration and Countersignature.

	  	
2

	
SECTION 5. Registration of Transfers and Exchanges; Transfer Restrictions.

	  	
2

	
SECTION 6. Terms of Warrants.

	  	
4

	
SECTION 7. Payment of Taxes

	  	
7

	
SECTION 8. Mutilated or Missing Warrant Certificates

	  	
7

	
SECTION 9. Reservation of Warrant Shares.

	  	
7

	
SECTION 10. Obtaining Stock Exchange Listings; State Registration

	  	
8

	
SECTION 11. Adjustment of Number of Warrant Shares

	  	
8

	
SECTION 12. Fractional Interests

	  	
13

	
SECTION 13. Notices to Warrant Holders.

	  	
13

	
SECTION 14. Merger, Consolidation or Change of Name of Warrant Agent.

	  	
15

	
SECTION 15. Conditions to Warrant Agent Duties and Obligations

	  	
15

	
SECTION 16. Change of Warrant Agent

	  	
17

	
SECTION 17. Notices to Company and Warrant Agent.

	  	
18

	
SECTION 18. Supplements and Amendments

	  	
19

	
SECTION 19. Successors

	  	
19

	
SECTION 20. Termination

	  	
19

	
SECTION 21. Governing Law

	  	
19

	
SECTION 22. Benefits of This Agreement

	  	
19

	
SECTION 23. Counterparts

	  	
19

	
SECTION 24. Force Majeure

	  	
19

	
EXHIBIT A  [Form of Warrant Certificate]

	  	
A-1

	
EXHIBIT B  LEGEND FOR PLACEMENT WARRANTS

	  	
B-1

	
EXHIBIT C  Warrant Agent Fees

	
  

	
C-1

  

i

  

 

WARRANT AGREEMENT

 

This Warrant Agreement (this “Agreement”) is made as of [●], 2011 between Selway Capital Acquisition Corporation, a Delaware corporation (the “Company”), and American Stock Transfer & Trust Company, a [_____], as Warrant Agent (the “Warrant Agent”).

 

WHEREAS, the Company has filed with the Securities and Exchange Commission (the “SEC”) a Registration Statement, No. 333-172714 on Form S-1 (as may be amended from time to time) (the “Registration Statement”) for the initial public offering of units (the “ Initial Public Offering”), each unit (“Unit”) consisting of one Series A Share of the Company’s common stock, par value $0.0001 per share (“Series A Shares”), and one warrant, each warrant to purchase one share of common stock at an exercise price of $10.00 per share (“Public Warrants”);

 

WHEREAS, the Company has agreed to issue (i) in a private placement to occur immediately prior to the closing of the Initial Public Offering, an aggregate of 3,300,000 warrants to purchase shares of common stock (the “Placement Warrants”) to Selway Capital Holdings, LLC (the “Private Placement Warrantholder”), and (ii) up to 3,000,000 full Public Warrants (together with the Placement Warrants, the “Warrants”).  The shares of common stock issuable on exercise of the Warrants are referred to as the “Warrant Shares”; 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, transfer, exchange and exercise of the Warrants and other matters as provided herein;

 

NOW, THEREFORE, in consideration of the premises and the mutual agreements herein set forth, the parties hereto agree as follows:

 

SECTION 1.  Appointment of Warrant Agent.  The Company hereby appoints the Warrant Agent to act as agent for the Company in accordance with the instructions set forth in this Agreement, and the Warrant Agent hereby accepts such appointment.

 

SECTION 2.  Warrant Certificates.  The Warrant Agent shall deliver certificates evidencing the Warrants (the “Warrant Certificates”) pursuant to this Agreement in registered form only substantially in the form set forth in Exhibit A attached hereto, and the warrant certificates for the Placement Warrants must bear the legend set forth in Exhibit B, except as set forth herein.

 

SECTION 3.  Execution of Warrant Certificates.

 

3.1           Warrant Certificates must be signed on behalf of the Company by its Chairman of the Board, President, Chief Executive Officer or a Vice President. Each such signature upon the Warrant Certificates may be in the form of a facsimile signature of the present or any future Chairman of the Board, President, Chief Executive Officer, or Vice President, and may be imprinted or otherwise reproduced on the Warrant Certificates and for that purpose the Company may adopt and use the facsimile signature of any person who has been Chairman of the Board, President, Chief Executive Officer, or Vice President, notwithstanding the fact that at the time the Warrant Certificates is countersigned and delivered or disposed of he or she has ceased to hold such office.

  

  

  

 

3.2           If any officer of the Company who has signed any of the Warrant Certificates ceases to be such officer before the Warrant Certificates so signed have been countersigned by the Warrant Agent, or disposed of by the Company, such Warrant Certificates nevertheless may be countersigned and delivered or disposed of as though such person had not ceased to be such officer of the Company; and any Warrant Certificate may be signed on behalf of the Company by any person who, at the actual date of the execution of such Warrant Certificate, is a proper officer of the Company to sign such Warrant Certificate, although at the date of the execution of this Agreement any such person was not such officer.

 

3.3           The Warrant Agent shall date the Warrant Certificates the date of countersignature by the Warrant Agent.

 

SECTION 4.  Registration and Countersignature.

 

4.1           The Warrant Agent shall, upon written instructions of the Chairman of the Board, the President, the Chief Executive Officer, a Vice President, the Treasurer or the Chief Financial Officer of the Company, countersign, issue and deliver Warrants as provided in this Agreement.  Warrant Certificates not countersigned by the Warrant Agent will not be valid for any purpose.

 

4.2           The Company and the Warrant Agent may deem and treat the registered holder(s) of the Warrant Certificates as the absolute owner(s) thereof (notwithstanding any notation of ownership or other writing thereon made by anyone), for all purposes, and neither the Company nor the Warrant Agent shall be affected by any notice to the contrary.

 

SECTION 5.  Registration of Transfers and Exchanges; Transfer Restrictions.

 

5.1           The Warrant Agent shall from time to time, subject to the limitations of this Section 5, register the transfer of any outstanding Warrant Certificates upon the records to be maintained by it for that purpose, upon surrender thereof duly endorsed or accompanied (if so required by the Warrant Agent) by a written instrument or instruments of transfer in form satisfactory to the Warrant Agent, duly executed by the registered holder or holders thereof or by the duly appointed legal representative thereof or by a duly authorized attorney.  Upon any such registration of transfer, the Warrant Agent shall issue a new Warrant Certificate to the transferee(s) and shall cancel the surrendered Warrant Certificate.  The Warrant Agent shall dispose of such cancelled Warrant Certificates in its customary manner.

 

5.2           The Placement Warrants may not be sold or transferred until the Company completes its initial business combination (as described more fully in the Registration Statement) ( the “Initial Business Combination”), except to a Permitted Transferee who agrees in writing with the Company to be subject to such transfer restrictions.

 

5.3           As used herein, “Permitted Transferee” means

 

(a)           any officer, director or employee of the Company;

 

(b)           an affiliate or a member of the holder’s immediate family (or a member of the immediate family of its officers or directors) or a trust or other entity, the beneficiary of which is the holder (or one of its officers or directors or a member of their respective immediate families); or

 

(c)           any successor in interest by virtue of the laws of descent and distribution upon death of any holder, or

 

(d)           pursuant to a qualified domestic relations order.

  

2

  

 

5.4           The holder of any Placement Warrants or Warrant Shares issued upon exercise of any Placement Warrants further agree, prior to any transfer of such securities, to give written notice to the Company expressing its desire to effect such transfer and describing briefly the proposed transfer.  Upon receiving such notice, the Company shall present copies thereof to its counsel and the holder agrees not to make any disposition of all or any portion of such securities unless and until:

 

(a)           there is then in effect a registration statement under the Securities Act covering such proposed disposition and such disposition is made in accordance with such registration statement, in which case the legends set forth in Exhibit B or Section 6(c) hereof, as the case may be (collectively the “Legends”) with respect to such securities sold pursuant to such registration statement shall be removed; or

 

(b)           if reasonably requested by the Company, (A) the holder shall have furnished the Company with an opinion of counsel, reasonably satisfactory to the Company, that such disposition will not require registration of such Securities under the Securities Act, (B) the Company shall have received customary representations and warranties regarding the transferee that are reasonably satisfactory to the Company signed by the proposed transferee and (C) the Company shall have received an agreement by such transferee to the restrictions contained in the Legends.

 

5.5           Each Public Warrant must initially be issued together with one share of common stock as a Unit.  The shares of common stock and Public Warrants comprising a Unit may not be separately transferable until 90 days following effectiveness of the Registration Statement, unless the Underwriter informs the Company of its decision to allow earlier separate trading, subject to the Company having filed a Form 8-K with the Securities and Exchange Commission containing an audited balance sheet reflecting the Company’s receipt of the gross proceeds of the offering of the Units and having issued a press release announcing when such separate trading will begin (the “Detachment Date”).  Prior to the Detachment Date, Public Warrants may be transferred or exchanged only together with the Unit in which such Public Warrant is included, and only for the purpose of effecting, or in conjunction with, a transfer or exchange of such Unit.  Furthermore, prior to the Detachment Date, each transfer of a Public Unit on the register relating to such Units shall operate also to transfer the Public Warrant included in such Unit.

 

5.6           Subject to the terms of this Agreement, Warrant Certificates may be exchanged at the option of the holder(s) thereof, when surrendered to the Warrant Agent at its principal corporate trust office, which is currently located at the address listed in Section 17 hereof, for another Warrant Certificate or other Warrant Certificates of like tenor and representing in the aggregate a like number of Warrants.  Any holder desiring to exchange a Warrant Certificate shall deliver a written request to the Warrant Agent, and shall surrender, duly endorsed or accompanied (if so required by the Warrant Agent) by a written instrument or instruments of transfer in form satisfactory to the Warrant Agent, the Warrant Certificate or Certificates to be so exchanged.  Warrant Certificates surrendered for exchange shall be cancelled by the Warrant Agent.  Such cancelled Warrant Certificates shall then be disposed of by such Warrant Agent in its customary manner.

 

5.7           The Warrant Agent is hereby authorized to countersign, in accordance with the provisions of this Section 5 and of Section 4 hereof, the new Warrant Certificates required pursuant to the provisions of this Section 5.

  

3

  

 

SECTION 6.  Terms of Warrants.

 

6.1           Exercise Price and Exercise Period.

 

(a)           The initial exercise price per share that Warrant Shares may be purchasable upon the exercise of full Warrants (the “Exercise Price”) is $10.00 per share, and each Warrant is initially exercisable to purchase one share of common stock.

 

(b)           Subject to the terms of this Agreement (including without limitation Section 6.4 below), each Warrant holder has the right, which may be exercised commencing at the opening of business on the first day of the applicable Warrant Exercise Period set forth below and until 5:00 p.m., New York City time, on the last day of such Warrant Exercise Period, to receive from the Company the number of fully paid and nonassessable Warrant Shares which the holder may at the time be entitled to receive on exercise of such Warrants and payment of the Exercise Price then in effect for such Warrant Shares.  No adjustments as to dividends will be made upon exercise of the Warrants.

 

(c)           The “Warrant Exercise Period” for all Warrants commences (subject to Section 6.4 below) on the later of: (A) the date that is 12 months from the date that the Registration Statement is declared effective by the Securities and Exchange Commission (the “Effective Date”) or (B) the date on which the Company consolidates each of its series of common stock into one class of common stock after it completes its Initial Business Combination or post-acquisition tender offer, as the case may be, and ends on the earlier of: (A) the date that is five years from the Effective Date or (B) the Business Day preceding the date on which such Warrants are redeemed pursuant to Section 6.2 below.

 

(d)           Each Warrant not exercised prior to 5:00 p.m., New York City time, on the last day of the Warrant Exercise Period shall become void and all rights thereunder and all rights in respect thereof under this Agreement shall cease as of such time.

 

6.2           Redemption of Warrants.

 

(a)           The Company may call the Warrants for redemption upon the Underwriter’s prior written consent, such consent not to be unreasonably withheld or delayed, in whole and not in part, at a price of $0.01 per Warrant, upon not less than 30 days’ prior written notice of redemption to each Warrant holder, at any time after such Warrants have become exercisable pursuant to Section 6(a), if, and only if, (i) the Closing Price has equaled or exceeded $17.50 (the “Redemption Threshold”) per share for any 20 trading days within a 30-trading-day period ending on the third business day prior to the notice of redemption to Warrant holders and (ii) at all times between the date of such notice of redemption and the redemption date a registration statement is in effect covering the Warrant Shares issuable upon exercise of the Warrants and a current prospectus relating to those Warrant Shares is available.

 

(b)           The “Closing Price” of the common stock on any date of determination means:

 

(i)           the closing sale price for the regular trading session (without considering after hours or other trading outside regular trading session hours) of the common stock (regular way) as reported in the composite transactions for the principal United States securities exchange on which the common stock is so listed on that date (or, if no closing price is reported, the last reported sale price during that regular trading session), or

 

(ii)          if the common stock is not so listed, the last quoted sales price for the common stock in the over-the-counter market as reported by the OTC Bulletin Board, the National Quotation Bureau or similar organization, or

  

4

  

 

(iii)         if the common stock is not so quoted, the average of the mid-point of the last bid and ask prices for the common stock from at least three nationally recognized investment-banking firms that the Company selects for this purpose.

 

6.3          Exercise Procedure.

 

(a)           A Warrant may be exercised upon surrender to the Company at the principal stock transfer office of the Warrant Agent, which is currently located at the address listed in Section 17 hereof, of the certificate or certificates evidencing the Warrants to be exercised with the form of election to purchase on the reverse thereof duly filled in and signed and such other documentation as the Warrant Agent may reasonably request, and upon payment to the Warrant Agent for the account of the Company of the Exercise Price (adjusted as herein provided if applicable) for the number of Warrant Shares in respect of which such Warrants are then exercised.  Payment of the aggregate Exercise Price must be made in cash or by certified or official bank check payable to the order of the Company in New York Clearing House Funds, or the equivalent thereof.

 

(b)           A Warrant may be settled on a cashless basis (in lieu of payment of the Exercise Price) in accordance with the following formula:

 

N’= (N x (P - E)) / P

 

where:

N’ =        the adjusted number of shares of common stock issuable upon cashless exercise of each Warrant.

N =         the current number of shares of common stock issuable upon exercise of each Warrant.

E =          the Exercise Price on the date of cashless exercise of the Warrants.

P =          the average reported last sales price of the common stock for the last 10 trading days ending on the third business day prior to the date on which notice of cashless exercise is given.

 

(c)           Subject to the provisions of Section 7, upon surrender of Warrants and payment of the Exercise Price or the settlement therefor on a cashless basis in accordance with Section 6.3(b) above, the Company shall issue and cause to be delivered with all reasonable dispatch to and in such name or names as the Warrant holder may designate, a certificate or certificates for the number of full Warrant Shares issuable upon the exercise of such Warrants.  Such certificate or certificates are to be deemed to have been issued and any person so designated to be named therein is to be deemed to have become a holder of record of such Warrant Shares as of the date of the surrender of such Warrants and payment of the Exercise Price.

 

(d)           The Warrants may be exercisable, at the election of the holders thereof, either in full or from time to time in part and, in the event that a certificate evidencing Warrants is exercised in respect of fewer than all of the Warrant Shares issuable on such exercise at any time prior to the date of expiration of the Warrants, a new certificate evidencing the remaining Warrant or Warrants will be issued, and the Warrant Agent is hereby irrevocably authorized to countersign and to deliver the required new Warrant Certificate or Certificates pursuant to the provisions of this Section 6 and of Section 4 hereof, and the Company, whenever required by the Warrant Agent, shall supply the Warrant Agent with Warrant Certificates duly executed on behalf of the Company for such purpose.  The Warrant Agent may assume that any Warrant presented for exercise is permitted to be so exercised under applicable law and shall have no liability for acting in reliance on such assumption.

  

5

  

 

(e)           The Warrant Agent shall cancel all Warrant Certificates surrendered upon exercise of Warrants and shall then dispose of such Warrant Certificates in its customary manner.  The Warrant Agent shall account promptly to the Company with respect to Warrants exercised and shall concurrently pay to the Company all monies received by the Warrant Agent for the purchase of the Warrant Shares through the exercise of such Warrants, unless the exercise is settled on a cashless basis in accordance with Section 6.3(b) above.

 

(f)           The Warrant Agent shall keep copies of this Agreement and any notices given or received hereunder available for inspection by the holders with reasonable prior written notice during normal business hours at its office.  The Company shall supply the Warrant Agent from time to time with such numbers of copies of this Agreement as the Warrant Agent may request.

 

(g)           Certificates evidencing Warrant Shares issued upon exercise of a Placement Warrant must bear the following legends:

 

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAW, AND MAY NOT BE OFFERED, SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND ANY APPLICABLE STATE SECURITIES LAWS OR AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.

 

SECURITIES EVIDENCED BY THIS CERTIFICATE WILL BE ENTITLED TO REGISTRATION RIGHTS UNDER A REGISTRATION RIGHTS AGREEMENT TO BE EXECUTED BY THE COMPANY.

 

SECURITIES EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND CONDITIONS OF AN ESCROW AGREEMENT BY AND BETWEEN THE COMPANY AND THE HOLDER OF THIS CERTIFICATE.  THESE SHARES MAY NOT BE SOLD EXCEPT IN COMPLIANCE WITH THAT AGREEMENT.

 

6.4           Registration Requirement.  Notwithstanding anything else in this Section 6, no Public Warrants may be exercised by the holder paying the Exercise Price in cash unless at the time of exercise (i) a registration statement covering the Warrant Shares to be issued upon exercise (other than Warrant Shares to be issued upon exercise of any Placement Warrant) is effective under the Securities Act of 1933, as amended (the “Act”) and (ii) a prospectus thereunder relating to the Warrant Shares is current.  The Company shall use commercially reasonable best efforts to have a registration statement in effect covering Warrant Shares issuable upon exercise of the Warrants from the date the Warrants become exercisable and to maintain a current prospectus relating to those Warrant Shares until the Warrants expire or are redeemed. In the event that, at the end of the Warrant Exercise Period, a Warrant has not been exercised, all the rights of the holder hereunder shall terminate and such Warrant shall expire unexercised and worthless, and as a result purchasers of the Units will have paid the full Unit price solely for the share of common stock included in each Unit.  The Company is not required to issue unregistered shares upon the exercise of any Warrant; provided, however , that the Company shall issue unregistered shares upon the exercise of any Placement Warrant, if, at the time of such exercise, there is not an effective registration statement or current prospectus covering the Warrant Shares underlying such Placement Warrant. In no event will the registered holder of the Warrant be entitled to receive a net-cash settlement, securities or other consideration in lieu of physical settlement in shares of common stock, regardless of whether the common stock underlying the Warrants is registered pursuant to an effective registration statement.

  

6

  

 

SECTION 7.  Payment of Taxes.  The Company shall pay all documentary stamp taxes attributable to the initial issuance of Warrant Shares upon the exercise of Warrants; provided, however, that the Company shall not be required to pay any tax or taxes which may be payable in respect of any transfer involved in the issue of any Warrant Certificates or any certificates for Warrant Shares in a name other than that of the registered holder of a Warrant Certificate surrendered upon the exercise of a Warrant, and the Company shall not be required to issue or deliver such Warrant Certificates unless or until the person or persons requesting the issuance thereof have paid to the Company the amount of such tax or have established to the satisfaction of the Company that such tax has been paid.

 

SECTION 8.  Mutilated or Missing Warrant Certificates.  If any Warrant Certificate is mutilated, lost, stolen or destroyed, the Company shall issue and the Warrant Agent shall countersign, in exchange and substitution for and upon cancellation of the mutilated Warrant Certificate, or in lieu of and substitution for the Warrant Certificate lost, stolen or destroyed, a new Warrant Certificate of like tenor and representing an equivalent number of Warrants, but only upon receipt of indemnity and evidence in each case satisfactory to the Company and the Warrant Agent of such loss, theft or destruction of such Warrant Certificate.  Applicants for such new Warrant Certificates shall pay such reasonable charges as the Company may prescribe.

 

SECTION 9.  Reservation of Warrant Shares.

 

9.1           The Company shall at all times reserve and keep available, free from preemptive rights, out of the aggregate of its authorized but unissued common stock or its authorized and issued common stock held in its treasury, for the purpose of enabling it to satisfy any obligation to issue Warrant Shares upon exercise of Warrants, the maximum number of shares of common stock which may then be deliverable upon the exercise of all outstanding Warrants.  The Warrant Agent is not required to verify availability of such shares set aside by the Company.

 

9.2           The Company or, if appointed, the transfer agent for the common stock (the “Transfer Agent”) and every subsequent transfer agent for any shares of the Company’s common stock issuable upon the exercise of any of the Warrants is hereby irrevocably authorized and directed at all times to reserve such number of authorized shares as shall be required for such purpose.  The Company shall keep a copy of this Agreement on file with the Transfer Agent and with every subsequent transfer agent for any shares of the Company’s common stock issuable upon the exercise of the Warrants.  The Warrant Agent is hereby irrevocably authorized to requisition from time to time from such Transfer Agent the stock certificates required to honor outstanding Warrants upon exercise thereof in accordance with the terms of this Agreement.  The Company shall supply such Transfer Agent with duly executed certificates for such purposes.  The Company shall furnish such Transfer Agent a copy of all notices of adjustments and certificates related thereto, transmitted to each holder pursuant to Section 13 hereof.

 

9.3           Before taking any action which would cause an adjustment pursuant to Section 11 hereof to reduce the Exercise Price below the then par value (if any) of the Warrant Shares, the Company shall take any commercially reasonable corporate action which may, in the opinion of its counsel (which may be counsel employed by the Company), be necessary in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares at the Exercise Price as so adjusted.

 

9.4           The Company shall, upon exercise of Warrants and payment of the Exercise Price therefor, issue Warrant Shares that are fully paid, nonassessable, free of preemptive rights and free from all taxes, liens, charges and security interests with respect to the issue thereof.

  

7

  

 

SECTION 10.  Obtaining Stock Exchange Listings; State Registration.  The Company shall from time to time take all commercially reasonable actions which may be necessary so that the Warrant Shares, immediately upon their issuance upon the exercise of Warrants, will be listed on the principal securities exchanges and markets within the United States of America, if any, on which other shares of common stock are then listed.  To the extent that the common stock is not listed on a national securities exchange or there is no exemption from state “blue sky” securities laws for the issuance of the Warrant Shares, the Company will take all commercially reasonable actions necessary so that the Warrant Shares are registered in all states in which the holders of the Warrants reside.

 

SECTION 11.  Adjustment of Number of Warrant Shares.  The number of Warrant Shares issuable upon the exercise of each Warrant is subject to adjustment from time to time upon the occurrence of the events enumerated in this Section 11.  For purposes of this Section 11, “common stock” means shares now or hereafter authorized of any class of common stock of the Company and any other stock of the Company, however designated, that has the right (subject to any prior rights of any class or series of preferred stock) to participate in any distribution of the assets or earnings of the Company without limit as to per share amount.

 

11.1        Adjustment for Change in Capital Stock. If the Company:  (i) pays a dividend or makes a distribution on its common stock in either case in shares of its common stock; (ii) subdivides its outstanding shares of common stock into a greater number of shares; (iii) combines its outstanding shares of common stock into a smaller number of shares; (iv) makes a distribution on its common stock in shares of its capital stock other than common stock; or (v) issues by reclassification of its common stock any shares of its capital stock, then the number of shares of common stock issuable upon exercise of each Warrant immediately prior to such action shall be proportionately adjusted so that the holder of any Warrant thereafter exercised shall receive the aggregate number and kind of shares of capital stock of the Company which he would have owned immediately following such action if such Warrant had been exercised immediately prior to such action.  The adjustment shall become effective immediately after the record date in the case of a dividend or distribution and immediately after the effective date in the case of a subdivision, combination or reclassification.  Such adjustment shall be made successively whenever any event listed above shall occur.

 

11.2        Adjustment for Rights Issue.

 

(a)           If the Company distributes any rights, options or warrants to all holders of its common stock entitling them to purchase shares of common stock at a price per share less than the Closing Price per share on the Business Day immediately preceding the ex-dividend date for such distribution of rights, options or warrants, the number of shares of common stock issuable upon exercise of each Warrant is to be adjusted in accordance with the following formula:

 

N’= N x ((O+A) / (O+(A x (P/M))))

 

where:

N’ =        the adjusted number of shares of common stock issuable upon exercise of each Warrant.

N =         the current number of shares of common stock issuable upon exercise of each Warrant.

O =         the number of shares of common stock outstanding on the record date for such distribution.

A =         the number of additional shares of common stock issuable pursuant to such rights or warrants.

P  =         the purchase price per share of the additional shares.

M =        the Closing Price per share of common stock on the record date.

  

8

  

 

(b)           The adjustment is to be made successively whenever any such rights, options or warrants are issued and is to become effective immediately after the record date for the determination of stockholders entitled to receive the rights, options or warrants.  If at the end of the period during which such rights, options or warrants are exercisable, not all rights, options or warrants have been exercised, the number of shares of common stock issuable upon exercise of each Warrant is to be immediately readjusted to what it would have been if “N” in the above formula had been the number of shares actually issued.

 

11.3        Adjustment for Other Distributions.

 

(a)           If the Company distributes to all holders of its common stock any of its assets (including cash) or debt securities or any rights, options or warrants to purchase debt securities, assets or other securities of the Company (other than common stock), the number of shares of common stock issuable upon exercise of each Warrant is to be adjusted in accordance with the formula:

 

N’ = N x (M / (M-F))

 

where:

N’ =        the adjusted number of shares of common stock issuable upon exercise of each Warrant.

N =         the current number of shares of common stock issuable upon exercise of each Warrant.

M =        the Closing Price per share of common stock on the Business Day immediately preceding the ex dividend date for such distribution.

F =          the fair market value on the ex dividend date for such distribution of the assets, securities, rights or warrants distributable to one share of common stock after taking into account, in the case of any rights, options or warrants, the consideration required to be paid upon exercise thereof.  The Board of Directors shall reasonably determine the fair market value in good faith.

 

(b)           The adjustment is to be made successively whenever any such distribution is made and shall become effective immediately after the record date for the determination of stockholders entitled to receive such distribution.

 

(c)           If any adjustment is made pursuant to this Section 11.3 as a result of the issuance of rights, options or warrants and at the end of the period during which any such rights, options or warrants are exercisable, not all such rights, options or warrants shall have been exercised, the Warrant shall be immediately readjusted as if “F” in the above formula was the fair market value on the ex-dividend date for such distribution of the indebtedness or assets actually distributed upon exercise of such rights, options or warrants divided by the number of shares of common stock outstanding on the ex-dividend date for such distribution.  Notwithstanding anything to the contrary contained in this subsection (c), if “M−F” in the above formula is less than $1.00, the Company may elect to, and if “M−F” or is a negative number, the Company shall, in lieu of the adjustment otherwise required by this Section 11.3, distribute to the holders of the Warrants, upon exercise thereof, the evidences of indebtedness, assets, rights, options or warrants (or the proceeds thereof) which would have been distributed to such holders had such Warrants been exercised immediately prior to the record date for such distribution.

  

9

  

 

11.4        Defined Terms; When De Minimis Adjustment May Be Deferred.

 

(a)           As used in this Section 11:

 

(i)           “Closing Price” of the common stock on any date of determination means: (x) the closing sale price for the regular trading session (without considering after hours or other trading outside regular trading session hours) of the common stock (regular way) as reported in the composite transactions for the principal United States securities exchange on which the common stock is so listed on that date (or, if no closing price is reported, the last reported sale price during that regular trading session); (y) if the common stock is not so reported, the last quoted sales price for the common stock in the over the counter market as reported by the OTC Bulletin Board, the National Quotation Bureau or similar organization; or (z) if the common stock is not so quoted, the average of the mid-point of the last bid and ask prices for the common stock from at least three nationally recognized investment-banking firms that the Company selects for this purpose;

 

(ii)          “ex-dividend date” means the first date on which the shares of common stock trade on the applicable exchange or in the applicable market, regular way, without the right to receive the issuance or distribution in question;

 

(iii)         “trading day” means, with respect to the common stock or any other security, a day during which (A) trading in the common stock or such other security generally occurs, (B) there is no market disruption event (as defined below) and (C) a Closing Price for the common stock or such other security (other than a Closing Price referred to in the next to last clause of such definition) is available for such day; provided that if the common stock or such other security is not admitted for trading or quotation on or by any exchange, bureau or other organization, “trading day” will mean any Business Day;

 

(iv)         “market disruption event” means, with respect to the common stock or any other security, the occurrence or existence of more than one-half hour period in the aggregate or any scheduled trading day for the common stock or such other security of any suspension or limitation imposed on trading (by reason of movements in price exceeding limits permitted by the stock exchange or otherwise) in the common stock or such other security or in any options, contract, or future contracts relating to the common stock or such other security, and such suspension or limitation occurs or exists at any time before 1:00 p.m.  (New York time) on such day; and

 

(v)          “Business Day” means, any day which is not a Saturday, a Sunday or any other day on which banks in the City of New York, New York, are authorized or required by law to close.

 

(b)           No adjustment in the number of shares of common stock issuable upon exercise of each Warrant need be made unless the adjustment would require an increase or decrease of at least 1% in such number.  Any adjustments that are not made are to be carried forward and taken into account in any subsequent adjustment.

 

(c)           All calculations under this Section 11 are to be made to the nearest cent or to the nearest 1/100th of a share, as the case may be.

 

11.5        When No Adjustment Required.

 

(a)           No adjustment need be made for a transaction referred to in Sections 11.2-11.3 if Warrant holders are to participate, without requiring the Warrants to be exercised, in the transaction on a basis and with notice that the Board of Directors of the Company reasonably determines to be fair and appropriate in light of the basis and notice on which holders of common stock participate in the transaction.

  

10

  

 

(b)           No adjustment need be made for a change in the par value or no par value of the common stock.

 

(c)           To the extent the Warrants become convertible into cash, no adjustment need be made thereafter as to the amount of cash into which such Warrants are exercisable.  Interest will not accrue on the cash.

 

11.6        Notice of Adjustment.  Whenever the number of shares of common stock issuable upon exercise of each Warrant is adjusted, the Company shall provide the notices required by Section 13 hereof.

 

11.7        Notice of Certain Transactions.

 

(a)           The Company shall mail to Warrant holders a notice stating the proposed record date for a dividend or distribution or the proposed effective date of a subdivision, combination, reclassification, consolidation, merger, transfer, lease, liquidation or dissolution if:

 

(i)           the Company takes any action that would require an adjustment in the Exercise Price pursuant to this Section 11, and if the Company does not arrange for Warrant holders to participate pursuant to Section 11.5;

 

(ii)          the Company takes any action that would require a supplemental Warrant Agreement pursuant to Section 11.8; or

 

(iii)         there is a liquidation or dissolution of the Company.

 

(b)           The Company shall mail the notice at least 15 days before such date.  Failure to mail the notice or any defect in it will not affect the validity of the transaction.

  

11

  

 

11.8        Reorganization of Company.

 

(a)           If the Company consolidates or merges with or into, or transfers or leases all or substantially all its assets to, any person, upon consummation of such transaction, the Warrants will automatically become exercisable for the kind and amount of securities, cash or other assets which the holder of a Warrant would have owned immediately after the consolidation, merger, transfer or lease if such holder had exercised the Warrant immediately before the effective date of the transaction; provided that (i) if the holders of common stock 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 for which each Warrant becomes exercisable is to be deemed the weighted average of the kind and amount received per share by the holders of common stock in such consolidation or merger that affirmatively make such election or (ii) if a tender or exchange offer has been made to and accepted by the holders of common stock 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 Securities Exchange Act of 1934, as amended (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 shares of common stock, the holder of a Warrant is entitled to receive the highest amount of cash, securities or other property to which such holder would actually have been entitled as a shareholder 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 common stock 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 11; provided further, however, that if less than 70% of the consideration (the “Public Share Percentage”) receivable by the holders of the common stock 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 Exercise 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 Combination, 2; if the applicable event is announced after the third anniversary of the closing date of the Initial Business Combination 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 Combination and on or prior to the Expiration Date, 3. “Per Share Consideration” means (i) if the consideration paid to holders of shares of common stock consists exclusively of cash, the amount of such cash per share of common stock, and (ii) in all other cases, the average reported last sales price of the common stock for the last 10 trading days ending on the trading day prior to the effective date of the applicable event.  Concurrently with the consummation of any such transaction, the corporation or other entity formed by or surviving any such consolidation or merger if other than the Company, or the person to which such sale or conveyance has been made, shall enter into a supplemental Warrant Agreement so providing and further providing for adjustments which are to be as nearly equivalent as may be practical to the adjustments provided for in this Section.  The successor Company shall mail to Warrant holders a notice describing the supplemental Warrant Agreement.

 

(b)           If the issuer of securities deliverable upon exercise of Warrants under the supplemental Warrant Agreement is an affiliate of the formed, surviving, transferee or lessee corporation, that issuer shall join in the supplemental Warrant Agreement.

 

(c)           If this Section 11.8 applies, Sections 11.2-11.7 do not apply.

 

11.9        Warrant Agent’s Disclaimer. The Warrant Agent is not required to determine when an adjustment under this Section 11 should be made, how it should be made or what it should be.  The Warrant Agent is not required to determine whether any provisions of a supplemental Warrant Agreement under Section 11.8 are correct.  The Warrant Agent makes no representation as to the validity or value of any securities or assets issued upon exercise of Warrants.  The Warrant Agent is not responsible for the Company’s failure to comply with this Section.

 

11.10      When Issuance or Payment May Be Deferred. In any case in which this Section 11 requires that an adjustment in the number of shares of common stock issuable upon exercise of each Warrant be made effective as of a record date for a specified event, the Company may elect to defer until the occurrence of such event issuing to the holder of any Warrant exercised after such record date the Warrant Shares and other capital stock of the Company, if any, issuable upon such exercise over and above the Warrant Shares and other capital stock of the Company, if any, issuable upon such exercise on the basis of the number of shares of common stock issuable upon exercise of each Warrant; provided, however, that the Company shall deliver to such holder a due bill or other appropriate instrument evidencing such holder’s right to receive such additional Warrant Shares and other capital stock upon the occurrence of the event requiring such adjustment.

  

12

  

 

11.11       Form of Warrants.  Notwithstanding any adjustments in the number or kind of shares issuable upon the exercise of the Warrants or the Exercise Price, Warrants theretofore or thereafter issued may continue to express the same number and kind of shares and Exercise Price as are stated in the Warrants initially issuable pursuant to this Agreement.

 

SECTION 12.  Fractional Interests.  The Company is not required to issue fractional Warrant Shares on the exercise of Warrants.  If more than one Warrant is presented for exercise in full at the same time by the same holder, the number of full Warrant Shares which are issuable upon the exercise thereof are to be computed on the basis of the aggregate number of Warrant Shares purchasable on exercise of the Warrants so presented, rounded down to the nearest whole number.

 

SECTION 13.  Notices to Warrant Holders.

 

13.1         Upon any adjustment of the Exercise Price pursuant to Section 11, the Company shall promptly thereafter, and in any event within five days, (a) cause to be filed with the Warrant Agent a certificate executed by the Chief Financial Officer or principal financial officer of the Company setting forth the number of Warrant Shares issuable upon exercise of each Warrant after such adjustment and setting forth in reasonable detail the method of calculation and the facts upon which such calculations are based, and (b) cause to be given to each of the registered holders of the Warrant Certificates at his address appearing on the Warrant register written notice of such adjustments by first-class mail, postage prepaid.  Where appropriate, such notice may be given in advance and included as a part of the notice required to be mailed under the other provisions of this Section 13.  The Warrant Agent may rely on any such certificate and on any adjustment therein contained and is not to be deemed to have knowledge of such adjustment unless and until it has received such certificate.

  

13

  

 

13.2         The Company shall cause to be filed with the Warrant Agent and shall cause to be given to each registered holder of Warrant Certificates at his address appearing on the Warrant register, at least 10 calendar days prior to the applicable record date hereinafter specified, or as promptly as practicable under the circumstances in the case of events for which there is no record date, by first-class mail, postage prepaid, a written notice stating (i) the date as of which the holders of record of shares of common stock to be entitled to receive any such rights, options, warrants or distribution are to be determined, (ii) the initial expiration date set forth in any tender offer or exchange offer for shares of common stock, or (iii) the date on which any such consolidation, merger, conveyance, transfer, dissolution, liquidation or winding up is expected to become effective or consummated, and the date as of which it is expected that holders of record of shares of common stock are to be entitled to exchange such shares for securities or other property, if any, deliverable upon such reclassification, consolidation, merger, conveyance, transfer, dissolution, liquidation or winding up, in the event:

 

(a)           the Company authorizes the issuance to all holders of shares of common stock of rights, options or warrants to subscribe for or purchase shares of common stock or of any other subscription rights or warrants;

 

(b)           the Company authorizes the distribution to all holders of shares of common stock of evidences of its indebtedness or assets (other than regular cash dividends or dividends payable in shares of common stock or distributions referred to in Section 11.3);

 

(c)           of any consolidation or merger to which the Company is a party and for which approval of any shareholders of the Company is required, or of the conveyance or transfer of the properties and assets of the Company substantially as an entirety, or of any reclassification or change of common stock issuable upon exercise of the Warrants (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination), or a tender offer or exchange offer for shares of common stock;

 

(d)           of the voluntary or involuntary dissolution, liquidation or winding up of the Company; or

 

(e)           the Company proposes to take any action not specified above which would require an adjustment of the Exercise Price pursuant to Section 11.

 

13.3         The failure to give the notice required by this Section 13 or any defect therein does not affect the legality or validity of any distribution, right, option, warrant, consolidation, merger, conveyance, transfer, dissolution, liquidation or winding up, or the vote upon any action.  Nothing contained in this Agreement or in any of the Warrant Certificates is to be construed as conferring upon the holders thereof the right 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, or any rights whatsoever as shareholders of the Company.

  

14

  

 

SECTION 14.  Merger, Consolidation or Change of Name of Warrant Agent.

 

14.1         Any corporation into which the Warrant Agent is merged or with which it is consolidated, or any corporation resulting from any merger or consolidation to which the Warrant Agent is a party, or any corporation succeeding to all or substantially all the corporate trust or agency business of the Warrant Agent, will be the successor to the Warrant Agent hereunder without the execution or filing of any paper or any further act on the part of any of the parties hereto, provided that such corporation would be eligible for appointment as a successor warrant agent under the provisions of Section 16.  If at the time the successor to the Warrant Agent succeeds to the agency created by this Agreement, and if at that time any of the Warrant Certificates have been countersigned but not delivered, any such successor to the Warrant Agent may adopt the countersignature of the original Warrant Agent; and if at that time any of the Warrant Certificates have not been countersigned, any successor to the Warrant Agent may countersign such Warrant Certificates either in the name of the predecessor Warrant Agent or in the name of the successor to the Warrant Agent; and in all such cases such Warrant Certificates will have the full force and effect provided in the Warrant Certificates and in this Agreement.

 

14.2         If at any time the name of the Warrant Agent is changed and at such time any of the Warrant Certificates have been countersigned but not delivered, the Warrant Agent whose name has been changed may adopt the countersignature under its prior name, and if at that time any of the Warrant Certificates have not been countersigned, the Warrant Agent may countersign such Warrant Certificates either in its prior name or in its changed name, and in all such cases such Warrant Certificates will have the full force and effect provided in the Warrant Certificates and in this Agreement.

 

SECTION 15.  Conditions to Warrant Agent Duties and Obligations.  The Warrant Agent undertakes the duties and obligations imposed by this Agreement (and no implied duties or obligations may be read into this Agreement against the Warrant Agent) upon the following terms and conditions, by all of which the Company and the holders of Warrants, by their acceptance thereof, are bound:

 

15.1         The statements contained herein and in the Warrant Certificates may be taken as statements of the Company and the Warrant Agent assumes no responsibility for the correctness of any of the same except such as describe the Warrant Agent or action taken or to be taken by it.  The Warrant Agent assumes no responsibility with respect to the distribution of the Warrant Certificates except as provided herein.

 

15.2         The Warrant Agent is not responsible for any failure of the Company to comply with any of the covenants contained in this Agreement or in the Warrant Certificates to be complied with by the Company.

 

15.3         The Warrant Agent may consult at any time with counsel of its own selection (who may be counsel for the Company) and the Warrant Agent incurs no liability or responsibility to the Company or to any holder of any Warrant Certificate in respect of any action taken, suffered or omitted by it hereunder in good faith and in accordance with the opinion or the advice of such counsel.  The Warrant Agent may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or through agents or attorneys and the Warrant Agent shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder.

 

15.4         The Warrant Agent may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Warrant Agent and conforming to the requirements of this Agreement.  The Warrant Agent incurs no liability or responsibility to the Company or to any holder of any Warrant Certificate for any action taken in reliance on any Warrant Certificate, certificate of shares, notice, resolution, waiver, consent, order, certificate, or other paper, document or instrument (whether in its original or facsimile form) believed by it to be genuine and to have been signed, sent or presented by the proper party or parties.

  

15

  

 

15.5         The Company shall: (i) pay to the Warrant Agent reasonable remuneration for its services as such Warrant Agent as set forth on Exhibit C hereto; (ii) reimburse the Warrant Agent for all reasonable expenses, taxes and governmental charges and other charges of any kind and nature incurred by the Warrant Agent in the execution of this Agreement (including fees and expenses of its counsel); and (iii) to indemnify the Warrant Agent (and any predecessor Warrant Agent) and save it harmless against any and all claims (whether asserted by the Company, a holder or any other person), damages, losses, expenses (including taxes other than taxes based on the income of the Warrant Agent), liabilities, including judgments, costs and counsel fees and expenses, for anything done or omitted by the Warrant Agent in the execution of this Agreement except as a result of its negligence, willful misconduct, or bad faith.  The provisions of this Section 15.5 survive the expiration of the Warrants and the termination of this Agreement.

 

15.6         The Warrant Agent is not required to institute any action, suit or legal proceeding or to take any other action likely to involve expense unless the Company or one or more registered holders of Warrant Certificates furnish the Warrant Agent with security and indemnity satisfactory to it for any costs and expenses which may be incurred, but this provision will not affect the power of the Warrant Agent to take such action as it may consider proper, whether with or without any such security or indemnity.  All rights of action under this Agreement or under any of the Warrants may be enforced by the Warrant Agent without the possession of any of the Warrant Certificates or the production thereof at any trial or other proceeding relative thereto, and any such action, suit or proceeding instituted by the Warrant Agent is to be brought in its name as Warrant Agent and any recovery of judgment is to be for the ratable benefit of the registered holders of the Warrants, as their respective rights or interests may appear.

 

15.7         The Warrant Agent, and any stockholder, director, officer or employee of it, may buy, sell or deal in any of the Warrants or other securities of the Company or become pecuniarily interested in any transaction in which the Company may be interested, or contract with or lend money to the Company or otherwise act as fully and freely as though it were not Warrant Agent under this Agreement.  Nothing herein precludes the Warrant Agent from acting in any other capacity for the Company or for any other legal entity.

 

15.8         The Warrant Agent shall act hereunder solely as agent for the Company, and its duties are determined solely by the provisions hereof.  The Warrant Agent shall not be liable for anything that it does or refrains from doing in connection with this Agreement except for its own negligence, willful misconduct, or bad faith.  The Warrant Agent is not be liable for any error of judgment made in good faith by it, unless it is proved that the Warrant Agent was negligent in ascertaining the pertinent facts.  Notwithstanding anything in this Agreement to the contrary, in no event is the Warrant Agent liable for special, indirect, punitive or consequential loss or damage of any kind whatsoever (including but not limited to lost profits), even if the Warrant Agent has been advised of the likelihood of the loss or damage and regardless of the form of the action.

 

15.9         The Warrant Agent is not required to make or cause to be made any adjustment of the Exercise Price or number of the Warrant Shares or other securities or property deliverable as provided in this Agreement, or to determine whether any facts exist which may require any of such adjustments, or with respect to the nature or extent of any such adjustments, when made, or with respect to the method employed in making the same.  The Warrant Agent is not accountable with respect to the validity or value or the kind or amount of any Warrant Shares or of any securities or property which may at any time be issued or delivered upon the exercise of any Warrant or with respect to whether any such Warrant Shares or other securities will when issued be validly issued and fully paid and nonassessable, and makes no representation with respect thereto.

  

16

  

 

15.10       Notwithstanding anything in this Agreement to the contrary, neither the Company nor the Warrant Agent has any liability to any holder of a Warrant Certificate or other Person as a result of its inability to perform any of its obligations under this Agreement by reason of any preliminary or permanent injunction or other order, decree or ruling issued by a court of competent jurisdiction or by a governmental, regulatory or administrative agency or commission, or any statute, rule, regulation or executive order promulgated or enacted by any governmental authority prohibiting or otherwise restraining performance of such obligation; provided that (i) the Company shall use commercially reasonable best efforts to have any such order, decree or ruling lifted or otherwise overturned as soon as possible and (ii) nothing in this Section 15.10 affects the Company’s obligation under Section 6.4 to use commercially reasonable best efforts to have a registration statement in effect covering the Warrant Shares issuable upon exercise of the Warrants and to maintain a current prospectus relating to those Warrant Shares.

 

15.11       Any application by the Warrant Agent for written instructions from the Company may, at the option of the Warrant Agent, set forth in writing any action proposed to be taken or omitted by the Warrant Agent under this Agreement and the date on and/or after which such action shall be taken or such omission shall be effective.  The Warrant Agent shall not be liable for any action taken by, or omission of, the Warrant Agent in accordance with a proposal included in such application on or after the date specified in such application (which date must not be less than three Business Days after the date any officer of the Company actually receives such application, unless any such officer has consented in writing to any earlier date) unless prior to taking any such action (or the effective date in the case of an omission), the Warrant Agent has received written instructions in response to such application specifying the action to be taken or omitted.

 

15.12       Warrant Agent is not required to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder or in the exercise of its rights.

 

15.13       In addition to the foregoing, the Warrant Agent is protected and does not incur liability for, or in respect of, any action taken or omitted by it in connection with its administration of this Agreement if such acts or omissions are not the result of the Warrant Agent’s reckless disregard of its duty, gross negligence or willful misconduct and are in reliance upon (i) the proper execution of the certification concerning beneficial ownership appended to the form of assignment and the form of the election attached hereto unless the Warrant Agent has actual knowledge that, as executed, such certification is untrue, or (ii) the non-execution of such certification including, without limitation, any refusal to honor any otherwise permissible assignment or election by reason of such non-execution.

 

SECTION 16.  Change of Warrant Agent.  The Warrant Agent may at any time resign as Warrant Agent upon written notice to the Company.  If the Warrant Agent becomes incapable of acting as Warrant Agent, the Company shall appoint a successor to such Warrant Agent.  If the Company fails to make such appointment within a period of 60 days after it has been notified in writing of such resignation or of such incapacity by the Warrant Agent or by the registered holder of a Warrant Certificate, then the registered holder of any Warrant Certificate or the Warrant Agent may apply, at the expense of the Company, to any court of competent jurisdiction for the appointment of a successor to the Warrant Agent.  Pending appointment of a successor to such Warrant Agent, either by the Company or by such a court, the duties of the Warrant Agent shall be carried out by the Company.  The holders of a majority of the unexercised Warrants may at any time remove the Warrant Agent and appoint a successor to such Warrant Agent.  If a Successor Warrant Agent is not appointed within 60 days of such removal, the Warrant Agent may apply, at the expense of the Company, to any court of competent jurisdiction for the appointment of a successor to the Warrant Agent.  Such successor to the Warrant Agent need not be approved by the Company or the former Warrant Agent.  After appointment the successor to the Warrant Agent will be vested with the same powers, rights, duties and responsibilities as if it had been originally named as Warrant Agent without further act or deed; but the former Warrant Agent upon payment of all fees and expenses due it and its agents and counsel shall deliver and transfer to the successor to the Warrant Agent any property at the time held by it hereunder and execute and deliver any further assurance, conveyance, act or deed necessary for the purpose.  Failure to give any notice provided for in this Section 16, however, or any defect therein, will not affect the legality or validity of the appointment of a successor to the Warrant Agent.

  

17

  

 

SECTION 17.  Notices to Company and Warrant Agent.

 

17.1        Any notice or demand authorized by this Agreement to be given or made by the Warrant Agent or by the registered holder of any Warrant Certificate to or on the Company is sufficiently given or made when and if deposited in the mail, first class or registered, postage prepaid, addressed (until another address is filed in writing by the Company with the Warrant Agent), as follows:

 

Selway Capital Acquisition Corporation

74 Grand Avenue

2nd Floor

Englewood, NJ 07631

Fax No.:  (201) 541-1084

Attention:  Chief Executive Officer

 

17.2        If the Company fails to maintain such office or agency or fails to give such notice of the location or of any change in the location thereof, presentations may be made and notices and demands may be served at the principal corporate trust office of the Warrant Agent.

 

17.3        Any notice pursuant to this Agreement to be given by the Company or by the registered holder(s) of any Warrant Certificate to the Warrant Agent is sufficiently given when and if deposited in the mail, first-class or registered, postage prepaid, addressed (until another address is filed in writing by the Warrant Agent with the Company) to the Warrant Agent as follows:

 

American Stock Transfer & Trust Company

6201 15th Avenue

Brooklyn, NY 11219

Fax: (718) 921-8355

Attention:  Compliance Department

  

18

  

 

SECTION 18.  Supplements and Amendments.  The Company and the Warrant Agent may from time to time supplement or amend this Agreement without the approval of any holders of Warrant Certificates in order to cure any ambiguity or to correct or supplement any provision contained herein which is defective or inconsistent with any other provision herein, or to make any other provisions in regard to matters or questions arising hereunder which the Company and the Warrant Agent may deem necessary or desirable and which do not in any way adversely affect the interests of the holders of Warrant Certificates theretofore issued.  Upon the delivery of a certificate from an appropriate officer of the Company that states that the proposed supplement or amendment is in compliance with the terms of this Section 18, the Warrant Agent shall execute such supplement or amendment.  Notwithstanding anything in this Agreement to the contrary, the prior written consent of the Warrant Agent must be obtained in connection with any supplement or amendment that alters the rights or duties of the Warrant Agent.  The Company and the Warrant Agent may amend any provision herein with the consent of the holders of Warrants exercisable for a majority of the Warrant Shares issuable on exercise of all outstanding Warrants; provided that any amendment affecting the Public Warrants must be approved by the holders of a majority of the Public Warrants.  Without limiting the generality of the foregoing, prior to the issuance of any Public Warrants, this Agreement (including the exhibits hereto) may be amended by the Company and the Warrant Agent, without the consent of any holder of Placement Warrants, to modify in any way or provide for the terms of the Public Warrants.

 

SECTION 19.  Successors.  All the covenants and provisions of this Agreement by or for the benefit of the Company or the Warrant Agent bind and inure to the benefit of their respective successors and assigns hereunder.

 

SECTION 20.  Termination.  This Agreement terminates on any earlier date if all Warrants have been exercised or expire without exercise.  The provisions of Section 15 hereof shall survive such termination.

 

SECTION 21.  Governing Law.  The laws of the State of New York govern this Agreement and each Warrant Certificate issued hereunder without regard to conflicts of laws principles.  The parties agree that all actions and proceedings arising out of this Agreement or any of the transactions contemplated hereby, shall be brought in the United States District Court for the Southern District of New York or in a New York State Court in the County of New York and that, in connection with any such action or proceeding, submit to the jurisdiction of, and venue in, such court.  Each of the parties hereto also irrevocably waives all right to trial by jury in any action, proceeding or counterclaim arising out of this Agreement or the transactions contemplated hereby.

 

SECTION 22.  Benefits of This Agreement.  Nothing in this Agreement is to be construed to give to any person or corporation other than the Company, the Warrant Agent and the registered holders of the Warrant Certificates any legal or equitable right, remedy or claim under this Agreement, and this Agreement is for the sole and exclusive benefit of the Company, the Warrant Agent and the registered holders of the Warrant Certificates.

 

SECTION 23.  Counterparts.  This Agreement may be executed in any number of counterparts and each of such counterparts is for all purposes to be deemed an original, and all such counterparts together constitute but one and the same instrument.

 

SECTION 24.  Force Majeure.  The Warrant Agent is not responsible or liable for any failure or delay in the performance of its obligations under this Agreement arising out of or caused by, directly or indirectly, forces beyond its reasonable control, including without limitation strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software or hardware) services.

  

19

  

 

[Signature page follows]

  

20

  

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first written above.

	
SELWAY CAPITAL ACQUISITION

CORPORATION

	  
	
By:

	  
	
Name:

	  
	
Title:

	  

 

	
AMERICAN STOCK TRANSFER & TRUST COMPANY, as Warrant Agent

	  
	
By:

	  	  
	
Name:

	  	  
	
Title:

	  	  

  

21

  

 

EXHIBIT A

 

[Form of Warrant Certificate]

  

A-1

  

 

[Form of Warrant Certificate]

 

[Reverse]

  

A-2

  

 

EXHIBIT B

 

LEGEND FOR PLACEMENT WARRANTS

 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE (INCLUDING THE SHARES  OF COMMON STOCK OF THE COMPANY ISSUABLE UPON EXERCISE OF SUCH SECURITIES) HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED OR ANY STATE SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND ANY APPLICABLE STATE SECURITIES LAWS OR AN EXEMPTION FROM REGISTRATION IS AVAILABLE.  IN ADDITION, THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN TRANSFER RESTRICTIONS SET FORTH IN THE WARRANT AGREEMENT REFERRED TO HEREIN.

 

SECURITIES EVIDENCED BY THIS CERTIFICATE AND COMMON STOCK OF THE COMPANY ISSUABLE UPON EXERCISE OF SUCH SECURITIES WILL BE ENTITLED TO REGISTRATION RIGHTS UNDER A REGISTRATION RIGHTS AGREEMENT TO BE EXECUTED BY THE COMPANY.

 

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND CONDITIONS OF AN ESCROW AGREEMENT BY AND BETWEEN THE COMPANY AND THE HOLDER OF THIS CERTIFICATE.  THESE SHARES MAY NOT BE SOLD EXCEPT IN COMPLIANCE WITH THAT AGREEMENT.

 

No. _____ _______ Warrants

  

B-1

  

 

EXHIBIT C

 

Warrant Agent Fees

	

Description

	 	

Amount ($)

	  	 	  
	
Fee for acting as Warrant Agent

	 	
[_____]

  

C-1THE 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 HUNDRED EIGHTY DAYS FOLLOWING THE EFFECTIVE DATE (DEFINED BELOW) TO ANYONE OTHER THAN (I) RODMAN & RENSHAW, LLC OR AN UNDERWRITER OR A SELECTED DEALER IN CONNECTION WITH THE OFFERING, OR (II) A BONA FIDE OFFICER OR PARTNER OF RODMAN & RENSHAW, LLC OR OF ANY SUCH UNDERWRITER OR SELECTED DEALER.

 

THIS PURCHASE OPTION IS NOT EXERCISABLE PRIOR TO THE LATER OF (1) THE CONSUMMATION BY SELWAY CAPITAL ACQUISITON CORPORATION (THE “COMPANY”) OF A MERGER, STOCK EXCHANGE, ASSET ACQUISITION, STOCK PURCHASE OR SIMILAR ACQUISITION TRANSACTION WITH ONE OR MORE OPERATING BUSINESSES (“ACQUISITION TRANSACTION”) (AS DESCRIBED MORE FULLY IN THE COMPANY’S REGSITRATION STATEMENT) OR AN ISSUER TENDER OFFER FOLLOWING AND ACQUISITION TRANSACTION PURSUANT TO THE COMPANYS AMENDED AND RESTATED ARTICLES OF INCORPORATION (“POST-ACQUSITION TENDER OFFER”) AND (2) [__________], 2012 [ONE YEAR FROM THE EFFECTIVE DATE OF THE COMPANY’S REGISTRATION STATEMENT], AND SHALL BE VOID AFTER 5:00 P.M. EASTERN TIME, [__________], 2016 [FIVE YEARS FROM THE EFFECTIVE DATE OF THE COMPANY’S REGISTRATION STATEMENT] OR EARLIER AS DESECRIBED BELOW.

 

UNIT PURCHASE OPTION

 

For the Purchase of Units

Of

SELWAY CAPITAL ACQUISITON CORPORATION

 

1.           Purchase Option. THIS CERTIFIES THAT, in consideration of funds duly paid by or on behalf of [___________] ("Holder"), as registered owner of this Purchase Option, to Selway Capital Acquisition Corporation (the "Company"), Holder is entitled, at any time or from time to time from the later of (i) the consummation of an initial Acquisition Transaction or Post-Acquisition Tender Offer and (ii) [___________], 2012 (the "Commencement Date"), and at or before 5:00 p.m., Eastern Time, on the earlier of (a) [___________], 2016, and (b) the day immediately prior to the day on which the Company and all of its predecessors and successors have been dissolved (the “Expiration Date”), but not thereafter, to subscribe for, purchase and receive, in whole or in part, up to [150,000] units (the “Units”) of the Company, each Unit consisting of share of Common Stock of the Company, $0.0001 par value per share (collectively, the “Common Stock”), and one warrant (collectively, the “Warrants”) to purchase one share of Common Stock expiring five years from the effective date (the “Effective Date”) of the registration statement pursuant to which Units are offered for sale to the public (the “Offering”).  If not exercised on or prior to the Expiration Date, this Purchase Option shall expire worthless and be of no further force and effect.  Each Warrant is on the same terms and conditions as the warrants underlying the Units being registered for sale to the public by way of the Registration Statement. If the Expiration Date is a day on which banking institutions are authorized by law to close, then this Purchase Option may be exercised on the next succeeding day which is not such a day in accordance with the terms herein. During the period ending on the Expiration Date, the Company agrees not to take any action that would terminate the Purchase Option (provided, however, that no action resulting in an Expiration Date pursuant to (b) will be deemed to be an action taken to terminate this Purchase Option). This Purchase Option is initially exercisable at $12.50 per Unit (125% of the price of the Units sold in the Offering); 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 shares of Common Stock to be received upon such exercise, shall be adjusted as therein specified. The term "Exercise Price" shall mean the initial exercise price or the adjusted exercise price, depending on the context.

  

  

  

 

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 by wire transfer of immediately available funds to an account designated by the Company or by certified check or official bank check. If the subscription rights represented hereby shall not be exercised at or before 5:00 p.m., Eastern time, on the Expiration Date, this Purchase Option shall become and be void without further force or effect, and all rights represented hereby shall cease and expire.

 

2.2           Cashless Exercise.  In lieu of the payment of the Exercise Price multiplied by the number of Units for which this Purchase Option is exercisable (and in lieu of being entitled to receive shares of Common Stock and Warrants) in the manner required by Section 2.1, the Holder shall have the right (but not the obligation) to convert any exercisable but unexercised portion of this Purchase Option into Units (the “Cashless Exercise Right”) as follows: upon exercise of the Cashless Exercise Right, the Company shall deliver to the Holder (without payment by the Holder of any of the Exercise Price in cash) that number of shares of Common Stock and Warrants comprising that number of Units equal to the quotient obtained by dividing (x) the Value (as defined below) of the portion of the Purchase Option being converted by (y) the Current Market Value (as defined below) of the portion of the Purchase Option being converted. The “Value” of the portion of the Purchase Option being converted shall equal the remainder derived from subtracting (a) (i) the Exercise Price multiplied by (ii) the number of Units underlying the portion of this Purchase Option being converted from (b) the Current Market Value (as defined below) of a Unit multiplied by the number of Units underlying the portion of the Purchase Option being converted.  As used herein, the term “Current Market Value” per Unit at any date means: (A) in the event that neither the Units nor Warrants are still trading or if (B) or (C) below do not apply, the remainder derived from subtracting (x) the exercise price of the Warrants multiplied by the number of shares of Common Stock issuable upon exercise of the Warrants underlying one Unit from (y) (i) the Current Market Price of the Common Stock multiplied by (ii) the number of shares of Common Stock underlying one Unit, which shall include the shares of Common Stock underlying the Warrants included in such Unit; (B) in the event that the Units, shares of Common Stock and Warrants are still trading, (i) if the Units are listed on a national securities exchange or quoted on the OTC Bulletin Board (or a successor market) and the Units have traded on such market in at least fifteen out of the last twenty trading days, the average of the last sale price of the Units in the principal trading market for the Units as reported by the exchange or the OTC Bulletin Board, as the case may be, for the ten trading days ending on the third business day prior to exercise; or (ii) if the Units are not listed on a national securities exchange or quoted on the OTC Bulletin Board (or successor market), but is traded in the residual over-the-counter market and the Units have traded on such market in at least fifteen out of the last twenty trading days, the average of the closing bid price for Units for the ten trading days ending on the third business day prior to exercise for which such quotations are reported by the Pink Sheets, LLC or similar publisher of such quotations; and (C) in the event that the Units are not still trading but the shares of Common Stock and Warrants underlying the Units are still trading and the Warrants have traded on such market in at least fifteen out of the last twenty trading days, the product of (x) the Current Market Price of the Common Stock and (y) the number of shares of Common Stock included in one Unit, plus the product of (x) the Current Market Price of the Warrants and (y) the number of Warrants included in one Unit. The “Current Market Price” shall mean (i) if the shares of Common Stock (or Warrants, as the case may be) is listed on a national securities exchange or quoted on the Nasdaq Global Market, Nasdaq Capital Market or OTC Bulletin Board (or successor market), the average of the sale price of the Common Stock (or Warrants) in the principal trading market for the shares of Common Stock as reported by the exchange, Nasdaq or OTC Bulletin Board, as the case may be, for the ten trading days ending on the third business day prior to exercise; (ii) if the shares of Common Stock (or Warrants, as the case may be) is not listed on a national securities exchange or quoted on the Nasdaq Global Market, Nasdaq Capital Market or OTC Bulletin Board (or successor market), but is traded in the residual over-the-counter market, the closing bid price for the Common Stock (or Warrants) 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 of Common Stock or Warrants cannot be determined pursuant to clause (i) or (ii) above, such price as the Board of Directors of the Company shall determine, in good faith.

  

  

  

 

2.3           Mechanics of Cashless Exercise. The 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           No Cash Settlement.  Under no circumstances will the Company be required to net cash settle the exercise of the Purchase Option or the Warrants underlying the Purchase Option.

 

2.5           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 "Act"):

 

"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") OR APPLICABLE STATE LAW. NEITHER THE SECURITIES NOR ANY INTEREST THEREIN MAY 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 WHICH, IN THE OPINION OF COUNSEL TO THE COMPANY, IS AVAILABLE."

  

  

  

 

3.           Transfer.

 

3.1           General Restrictions. The registered Holder of this Purchase Option agrees by his, her or its acceptance hereof, that such Holder will not: (a) sell, transfer, assign, pledge or  hypothecate this Purchase Option for a period of one hundred eighty (180) days following the  Effective Date to anyone other than: (i) Rodman & Renshaw, LLC ("Rodman & Renshaw") or an underwriter or a selected dealer participating in the Offering, or (ii) a bona fide officer or partner of Rodman & Renshaw or of any such underwriter or selected dealer, in each case in accordance with FINRA Conduct Rule 5110(g)(1), or (b) cause this Purchase Option or the securities issuable hereunder to be the subject of any hedging, short sale, derivative, put or call transaction that would result in the effective economic disposition of this Purchase Option or the securities hereunder, except as provided for in FINRA Rule 5110(g)(2). Immediately following such 180-day period, transfers to other persons 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.

 

3.2           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 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 Loeb & Loeb LLP 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 the offer and sale of 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.           Registration Rights.

 

4.1           Demand Registration.

 

4.1.1        Grant of Right.  The Company, upon written demand (a “Demand Notice”) of the Holder(s) of at least 51% (the “Majority Holders”) of the Purchase Options and/or the underlying Units and/or the underlying Securities, agrees to register, on one occasion, all or any portion of the Purchase Option and the underlying Securities (collectively, the “Registrable Securities”) as requested by the Majority Holders.  The Company will file a registration statement or a post-effective amendment to the Registration Statement covering the Registrable Securities within sixty (60) days after receipt of the Initial Demand Notice and use its reasonable best efforts to have such registration statement or post-effective amendment declared effective as soon as possible thereafter.  The demand for registration may be made at any time during a period of five (5) years beginning on the Effective Date.  The Company covenants and agrees to give written notice of its receipt of any Demand Notice by any Holder(s) to all other registered Holders of the Purchase Options and/or the Registrable Securities within ten (10) days from the date of the receipt of any such 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 fifteen (15) days after the receipt by the holder of the notice from the Company.  Upon any such request, the Demanding Holders shall be entitled to have their Registrable Securities included in the Demand Registration.

  

  

  

 

4.1.2        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 Purchase Option 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, (i) such stop order or injunction is removed, rescinded or otherwise terminated, and (ii) a majority-in-interest of the Demanding Holders thereafter elect to continue the offering.

 

4.1.3        Terms. The Company shall bear all fees and expenses attendant to the registration of the Registrable Securities pursuant to Section 4.1.1, but the Holders shall pay any and all underwriting commissions and the expenses of any legal counsel selected by the Holders to represent them in connection with the sale of the Registrable Securities. The Company agrees to use its reasonable best efforts to cause the filing required herein to become effective promptly and to qualify or register the Registrable Securities in such States as are reasonably requested by the 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 register or license to do business in such State or submit to general service of process in such State or subject the Company to taxation as a foreign corporation doing business in such jurisdiction, or (ii) the principal shareholders of the Company to be obligated to escrow their shares of capital stock of the Company. The Company shall cause any registration statement filed pursuant to the demand right granted under Section 4.1.1 to remain effective for a period of at least twelve consecutive months from the date that the Holders of the Registrable Securities covered by such registration statement are first given the opportunity to sell all of such securities. The Holders shall only use the prospectuses provided by the Company to sell the shares covered by such registration statement, and will immediately cease to use any prospectus furnished by the Company if the Company advises the Holder that such prospectus may no longer be used due to a material misstatement or omission.

  

  

  

 

4.2           "Piggy-Back" Registration.

 

4.2.1        Grant of Right. In addition to the demand right of registration, described in Section 4.1 hereof the Holder shall have the right, for a period of seven (7) years commencing on the Effective Date, to include the Registrable Securities as part of any Registration Statement filed by the Company; provided, however, that if, solely in connection with any primary underwritten public offering for the account of the Company, the managing underwriter(s) thereof shall, in its reasonable discretion, impose a limitation on the number of shares of Common Stock which may be included in the Registration Statement because, in such underwriter(s)' judgment, marketing or other factors dictate such limitation is necessary to facilitate public distribution, then the Company shall be obligated to include in such Registration Statement only such limited portion of the Registrable Securities with respect to which the Holder requested inclusion hereunder as the underwriter shall reasonably permit. If the securities owned by other holders of “piggyback rights” to be included under such Registration Statement are reduced, then the number of Registrable Securities hereunder to be included in the Registration Statement shall be reduced in the manner set forth in Section 2.2.2 of that certain Registration Rights Agreement dated December 9, 2010 (the "Registration Rights Agreement") by and between the Company and FWAC Holdings Limited, as though the Registrable Securities were included in the definition of “Registrable Securities” set forth in Section 1 of the Registration Rights Agreement.  If any Registrable Securities are included, then any exclusion of Registrable Securities shall be made pro rata among the Holders seeking to include Registrable Securities in proportion to the number of Registrable Securities sought to be included by such Holders; provided, however, that the Company shall not exclude any Registrable Securities unless the Company has first excluded all outstanding securities, the holders of which are not entitled to inclusion of such securities in such Registration Statement or are not entitled to pro rata inclusion with the Registrable Securities. For the purposes hereof, “Registration Statement” means a registration statement filed by the Company with the Commission in compliance with the Act and the rules and regulations promulgated thereunder for a public offering and sale of equity securities, or securities or other obligations exercisable or exchangeable for, or convertible into, equity securities (other than a Registration Statement (i) on Form F-4, F-8, S-4 or S-8, or their successors, (ii) any Registration Statement covering only securities proposed to be issued in exchange for securities or assets of another entity), (iii) for an exchange offer or offering of securities solely to the Company’s existing shareholders, or (iv) for a dividend reinvestment plan.

 

4.2.2        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 such 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 herein.

 

4.2.3        Terms. The Company shall bear all fees and expenses attendant to registering the Registrable Securities pursuant to Section 4.2.1 hereof, but the Holders shall pay any and all underwriting commissions and the expenses of any legal counsel selected by the Holders to represent them in connection with the sale of the Registrable Securities. In the event of such a proposed registration, the Company shall furnish the then Holders of outstanding Registrable Securities with not less than fifteen (15) days written notice prior to the proposed date of filing of such registration statement. Such notice to the Holders shall continue to be given for each registration statement filed by the Company until such time as all of the Registrable Securities have been sold by the Holder. The holders of the Registrable Securities shall exercise the "piggy-back" rights provided for herein by giving written. notice, within ten (10) days of the receipt of the Company's notice of its intention to file a registration statement.

  

  

  

 

4.3           General Terms.

 

4.3.1        Indemnification. The Company shall indemnify the Holder(s) of the Registrable Securities to be sold pursuant to any registration statement hereunder and each person, if any, who controls such Holders within the meaning of Section 15 of the Act or Section 20 (a) of the Securities Exchange Act of 1934, as amended ("Exchange Act"), against all loss, claim, damage, expense or liability (including all reasonable attorneys' fees and other expenses reasonably incurred in investigating, preparing or defending against any claim whatsoever) to which any of them may become subject under the Act, the Exchange Act or otherwise, arising from such registration statement but only to the same extent and with the same effect as the provisions pursuant to which the Company has agreed to indemnify the Underwriters contained in Section 5.1 of the Underwriting Agreement between the Underwriters and the Company, dated as of December 9, 2010. The Holder(s) of the Registrable Securities to be sold pursuant to such registration statement, and their successors and assigns, shall severally, and not jointly, indemnify the Company, its officers and directors and each person, if any, who controls the Company within the meaning of Section 15 of the Act or Section 20(a) of the Exchange Act, against all loss, claim, damage, expense or liability (including all reasonable attorneys' fees and other expenses reasonably incurred in investigating, preparing or defending against any claim whatsoever) to which they may become subject under the Act, the Exchange Act or otherwise, arising from information furnished by or on behalf of such Holders, or their successors or assigns, in writing, for specific inclusion in such registration statement to the same extent and with the same effect as the provisions contained in Section 5.2 of the Underwriting Agreement pursuant to which the Underwriters have agreed to indemnify the Company.

 

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

 

4.3.3        Documents Delivered to Holders. The Company shall furnish to each Holder participating in any of the foregoing offerings and to each underwriter of any such offering, if any, a signed counterpart, addressed to such Holder or underwriter, of. (i) an opinion of counsel to the Company, dated the effective date of such registration statement (and, if such registration includes an underwritten public offering, an opinion dated the date of the closing under any underwriting agreement related thereto), and (ii) a "cold comfort" letter dated the effective date of such registration statement (and, if such registration includes an underwritten public offering, a letter dated the date of the closing under the underwriting agreement) signed by the independent public accountants who have issued a report on the Company's financial statements included in such registration statement, in each case covering substantially the same matters with respect to such registration statement (and the prospectus included therein) and, in the case of such accountants' 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 each Holder participating in the offering requesting the correspondence and memoranda described below and to the managing underwriter, if any, copies of all correspondence between the SEC and the Company, its counsel or auditors and all memoranda relating to discussions with the SEC or its staff with respect to the registration statement and permit each Holder and underwriter 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 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 as any such holder shall reasonably request. The Company shall not be required to disclose any material non-public information to 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.

  

  

  

 

4.3.4        Documents to be Delivered by Holder(s).  Each Holder participating in any of the foregoing offerings shall furnish to the Company a completed and executed questionnaire provided by the Company requesting information customarily sought of selling securityholders.

 

4.3.5        Underwriting Agreement. The Company shall enter into an underwriting agreement with the managing underwriter(s), if any, selected by any Holders whose Registrable Securities are being registered pursuant to this Section 4, which managing underwriter shall be reasonably satisfactory to the Company. Such agreement shall be reasonably satisfactory in form and substance to the Company and its legal counsel, each Holder and such managing underwriters, and shall contain such representations, warranties and covenants by the Company and such other terms as are customarily contained in agreements of that type used by the managing underwriter. The Holders shall be parties to any underwriting agreement relating to an underwritten sale of their Registrable Securities and may, at their option, require that any or all the representations, warranties and covenants of the Company to or for the benefit of such underwriters shall also be made to and for the benefit of such Holders. Such Holders shall not be required to make any representations or warranties to or agreements with the Company or the underwriters except as they may relate to such Holders and their intended methods of distribution. Such Holders, however, shall agree to such covenants and indemnification and contribution obligations for selling shareholders as are customarily contained in agreements of that type. 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.

 

4.3.6        Damages. Should the registration or the effectiveness thereof required by Sections 4.1 and 4.2 hereof be delayed by the Company or the Company otherwise fails to comply with such provisions, the Holder(s) shall, in addition to any other legal or other relief available to the Holder(s), be entitled to obtain specific performance or other equitable (including injunctive) relief against the threatened breach of such provisions or the continuation of any such breach, without the necessity of proving actual damages and without the necessity of posting bond or other security.

 

5.           New Purchase Options to be Issued.

 

5.1           Partial Exercise or Transfer. Subject to the restrictions in Section 3 hereof, this Purchase Option may be exercised or assigned in whole or in part. In the event of the exercise or assignment hereof in part only, upon surrender of this Purchase Option for cancellation, together with the duly executed exercise or assignment form and funds sufficient to pay any Exercise Price and/or transfer tax if exercised pursuant to Section 2.1 hereto, 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.

 

5.2           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.

  

  

  

 

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        Share 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 Common Stock or by a split up of Common Stock or other similar event, then, on the effective day thereof, (i) if the number of shares of Common Stock underlying outstanding public warrants to purchase shares of Common Stock is increased, then the number of shares of Common Stock underlying the Units shall be increased in proportion to the increase in the outstanding shares of Common Stock, or (ii) in the event that (i) is not applicable, the number of Units purchasable hereunder shall be increased in proportion to such increase in outstanding shares of Common Stock and the Exercise Price shall be proportionately decreased.

 

6.1.2        Aggregation of Common Stock. 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 Common Stock or other similar event, then, on the effective date thereof, (i) if the number of shares of Common Stock underlying outstanding public warrants to purchase shares of Common Stock is decreased, then the number of shares of Common Stock underlying the Units shall be decreased in proportion to the decrease in the outstanding shares of Common Stock, or (ii) in the event that (i) is not applicable, the number of Units purchasable hereunder shall be decreased in proportion to such decrease in outstanding shares of Common Stock and the Exercise Price shall be proportionately increased.

 

6.1.3        Replacement of Securities upon Reorganization, etc. In case of any reclassification or reorganization of the outstanding shares of Common Stock other than a change covered by Section 6.1.1 or 6.1.2 hereof or that solely affects the par value of such shares of Common Stock, or in the case of any share reconstruction or amalgamation or consolidation of the Company with or into another corporation (other than a consolidation or share reconstruction or amalgamation 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, share reconstruction or amalgamation, or consolidation, or upon a dissolution following any such sale or transfer, by a Holder of the number of Units 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 covered by Section 6.1.1 or 6.1.2, then such adjustment shall be made pursuant to Sections 6.1.1, 6.1.2 and this Section 6.1.3. The provisions of this Section 6.1.3 shall similarly apply to successive reclassifications, reorganizations, share reconstructions or amalgamations, or consolidations, sales or other transfers.

  

  

  

 

6.1.4        Changes in Form of Purchase Option. This form of Purchase Option need not be changed because of any change pursuant to this Section 6, and the Purchase Options issued after such change may state the same Exercise Price and the same number of Units as are stated in the Purchase Options initially issued pursuant to this Agreement. The acceptance by any Holder of the issuance of new Purchase Options reflecting a required or permissive change shall not be deemed to waive any rights to an adjustment occurring after the Commencement Date or the computation thereof.

 

6.2           Substitute Purchase Option. In case of any consolidation of the Company with, or share reconstruction or amalgamation of the Company with or into, another corporation (other than a consolidation or share reconstruction or amalgamation which does not result in any reclassification or change of the outstanding shares of Common Stock), the corporation formed by such consolidation or share reconstruction or amalgamation 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 share reconstruction or amalgamation, 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, share reconstruction or amalgamation, sale or transfer. Such supplemental Purchase Option shall provide for adjustments which shall be identical to the adjustments provided for in this Section 6. The above provision of this Section shall similarly apply to successive consolidations or share reconstructions or amalgamations.

 

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, as the case may be, 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, 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 therefore, in accordance with the terms hereby, all shares of Common Stock and other securities issuable upon such exercise shall be duly and validly issued, fully paid and non-assessable and not subject to preemptive rights of any shareholder. The Company further covenants and agrees that upon exercise of the Purchase Options and payment of the exercise price therefore, all shares of Common Stock and other securities issuable upon such exercise shall be duly and validly issued, fully paid and non-assessable and not subject to preemptive rights of any shareholder. As long as the Purchase Options shall be outstanding, the Company shall use its commercially reasonable efforts to cause all (i) Units and shares of Common Stock issuable upon exercise of the Purchase 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 OTC Bulletin Board or any successor trading market) on which the Units, the shares of Common Stock or the 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 or to receive notice as a shareholder for the election of directors or any other matter, or as having any rights whatsoever as a shareholder of the Company. If, however, at any time prior to the expiration of the Purchase 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 shareholders entitled to such dividend, distribution, conversion or exchange of securities or subscription rights, or entitled to vote on such proposed dissolution, liquidation, winding up or sale. Such notice shall specify such record date or the date of the closing of the transfer books, as the case may be. Notwithstanding the foregoing, the Company shall deliver to each Holder a copy of each notice given to the other shareholders of the Company at the same time and in the same manner that such notice is given to the shareholders.

 

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

 

8.3           Notice of Change in Exercise Price. The Company shall, promptly after an event requiring a change in the Exercise Price pursuant to Section 6 hereof, send notice to the Holders of such event and change ("Price Notice"). The Price Notice shall describe the event causing the change and the method of calculating same and shall be certified as being true and accurate by the Company's Chief Financial Officer.

 

8.4           Transmittal of Notices. All notices, demands, requests, consents, approvals or other communications required or permitted to be given hereunder or which are given with respect to this Agreement shall be in writing and shall be personally served, delivered by reputable air courier service with charges prepaid, or transmitted by hand delivery, telegram, telex or facsimile, addressed as set forth below, or to such other address as such party shall have specified most recently by written notice. Notice shall be deemed given on the date of service or transmission if personally served or transmitted by telegram, telex, facsimile or electronic mail; provided, that if such service or transmission is not on a business day or is after normal business hours, then such notice shall be deemed given on the next business day. Notice otherwise sent as provided herein shall be deemed given on the next business day following timely delivery of such notice to a reputable air courier service with an order for next-day delivery.

  

  

  

 

To the Company:

 

Selway Capital Acquisition Corporation

74 Grand Avenue, 2nd Floor

Englewood, NJ 07631

Attn:  Yaron Eitan

 

With a copy to (which shall not constitute notice):

 

Loeb & Loeb LLP

345 Park Avenue

New York, NY 10154

Attn: Mitchell S. Nussbaum

 

9.           Miscellaneous.

 

9.1           Amendments. The Company and Rodman & Renshaw may from time to time supplement or amend this Purchase Option without the approval of any of the Holders in order to cure any ambiguity, to correct or supplement any provision contained herein that may be defective or inconsistent with any other provisions herein, or to make any other provisions in regard to matters or questions arising hereunder that the Company and Rodman & Renshaw may deem necessary or desirable and that the Company and Rodman & Renshaw deem shall not adversely affect the interest of the Holders. All other modifications or amendments shall require the written consent of and be signed by the party against whom enforcement of the modification or amendment is sought.

 

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 principles thereof. The Company hereby agrees that any action, proceeding or claim against it arising out of, or relating in any way to this Purchase Option shall be brought and enforced in the New York Supreme Court, County of New York, or in 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 therefore.

  

  

  

 

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. Such counterparts may be delivered by facsimile transmission or other electronic transmission.

 

9.8           Exchange Agreement. As a condition of the Holder's receipt and acceptance of this Purchase Option, Holder agrees that, at any time prior to the complete exercise of this Purchase Option by Holder, if the Company and Rodman & Renshaw enter into an agreement ("Exchange Agreement") pursuant to which they agree that all outstanding Purchase Options will be exchanged for securities or cash or a combination of both, then Holder shall agree to such exchange and become a party to the Exchange Agreement.

 

[Remainder of page deliberately left blank.]

  

  

  

 

IN WITNESS WHEREOF, the Company has caused this Purchase Option to be signed by its duly authorized officer as of the _____ day of ____________, 2011.

	
SELWAY CAPITAL ACQUISITION CORPORATION

	  	  
	
By:

	
   

	
Name:

	
Title:

 

Unit Purchase Option

  

  

  

 

[Form to be used to exercise Purchase Option:

 

Date:                  ,                      20___

 

The undersigned hereby elects irrevocably to exercise the Purchase Option for [___] Units of Selway Capital Acquisition Corporation and hereby makes payment of $12.50 (at the rate of $[___________] per Unit) in payment of the Exercise Price pursuant thereto. Please issue the shares of Common Stock and Warrants as to which this Purchase Option is exercised in accordance with the instructions given below and, if applicable, a new Purchase Option representing the number of Units for which this Purchase Option has not been exercised.

 

or

 

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

 

The undersigned agrees and acknowledges that the calculation set forth above is subject to confirmation by the Company and any disagreement with respect to the calculation shall be resolved by the Company in its sole discretion.

 

Signature

 

Signature Guaranteed]

  

  

  

 

INSTRUCTIONS FOR REGISTRATION OF SECURITIES

 

Name:

 

(Print in Block Letters)

 

Address:

 

NOTICE: The signature to this form must correspond with the name as written upon the face of the Purchase Option without alteration or enlargement or any change whatsoever, and must be guaranteed by a bank, other than a savings bank, or by a trust company or by a firm having membership on a registered national securities exchange.

 

  

  

  

 

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 Selway Capital Acquisition Corporation ("Company") evidenced by the Purchase Option and does hereby authorize the Company to transfer such right on the books of the Company.

 

Dated:           , 20__

 

Signature

 

Signature Guaranteed

 

NOTICE: The signature to this form must correspond with the name as written upon the face of the within Purchase Option without alteration or enlargement or any change whatsoever, and must be guaranteed by a bank, other than a savings bank, or by a trust company or by a firm having membership on a registered national securities exchange.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00188-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00188-of-00352.parquet"}]]