Document:

Unassociated Document

    

    WAIVER
AND FORBEARANCE AGREEMENT

    

    

    THIS WAIVER AND FORBEARANCE
AGREEMENT (this “Agreement”) is
entered into as of January 10, 2011 by and among MANHATTAN PHARMACEUTICALS,
INC., a Delaware corporation with a principal address at 48 Wall Street,
New York, New York 10005 (the “Borrower” or the
“Company”), and
the other parties signatory hereto (each severally a “Lender” and
collectively the “Lenders”).

    

    RECITALS

    

    WHEREAS, in accordance with
that certain Securities Purchase Agreement dated as of November 19, 2008 by and
among the Borrower
and the Lenders (the “Securities Purchase
Agreement”), the Borrower executed and delivered to each Lender a 12%
Senior Secured Promissory Note, in various original principal amounts, and in an
aggregate original principal amount of $1,735,000 (each a “Note” and
collectively the “Notes”);
and

    

    WHEREAS, as collateral
security for the Borrower’s obligations under the Notes, the Borrower executed
and delivered in favor of the Lenders a security agreement of even date
therewith (the “Security Agreement”);
and

    

    WHEREAS, as further collateral
security for the Borrower’s obligations under the Notes, the Borrower executed
and delivered in favor of the Lenders a Default Agreement of even date therewith
(the “Default
Agreement”) whereby, inter alia, the Borrower
agreed to liquidate certain securities owned by the Borrower in the event of the
occurrence of an Event of Default as defined in the Security Agreement;
and

    

    WHEREAS, on November 19, 2010
(the “First Maturity
Date”), $1,035,000.00 of the Notes matured, whereupon, pursuant to
Section 7.2 of the Notes, the Requisite Holders (as defined in Section 6 of the
Notes) had the right, upon five (5) days’ notice or demand, to declare the Notes
to be due and payable; and

    

    WHEREAS, on December 22, 2010
(the “Second Maturity Date” and, together with the First Maturity Date, the
"Past Maturity
Dates"), $280,000.00 of the Notes matured, whereupon, pursuant to Section
7.2 of the Notes, the Requisite Holders (as defined in Section 6 of the Notes)
had the right, upon five (5) days’ notice or demand, to declare the Notes to be
due and payable (and the remaining Notes will mature in the near future);
and

    

    WHEREAS, the failure of the
Borrower to pay the Notes on the Past Maturity Dates
constitutes, and the failure of the Borrower to pay the Notes on future maturity
dates will constitute, an event of default (the “Designated Default”)
under the Notes, the Security Agreement, and the Default Agreement (collectively
the “Loan
Documents”); and

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    WHEREAS, the Borrower has
requested that the Lenders forbear from exercising their rights and remedies
under the Loan Documents and grant to Borrower an extension of the maturity
dates of each of the Notes, and the Lenders who are signatory hereto are
agreeable thereto, subject to a modification of the Notes and the warrants
previously issued by the Company to the holders of the Notes (the “Warrants”), and the
other terms, covenants and conditions hereinafter set forth; and

    

    

    WHEREAS, following the
effectiveness of the waiver and forbearance contained, herein the Company will
seek to reduce its outstanding indebtedness by offering the Lenders the ability
to convert the Notes at a conversion price of $0.01 per share, which shall
require the Company obtaining shareholder approval to increase the Company’s
authorized common stock (the foregoing actions, hereinafter the “Subsequent
Offering”); and

    

    WHEREAS, upon the reduction of
the conversion price of the Notes in the Subsequent Offering, as a result of the
full-ratchet anti-dilution provisions contained in certain warrants issued by
the Company on October 28, 2009, March 2, 2010 and April 8, 2010 (the “Equity Transaction
Warrants”), number of shares of the Company’s common stock into which the
Equity Transaction Warrants are exercisable will increase from 72,411,248 to
575,448,715, and the exercise price of the Equity Transaction Warrants will
decrease for $0.08 and $0.07 to $0.01;

     

    

    WHEREAS, the Borrower and
Nordic Biotech Venture Fund II K/S ("Nordic") have entered into a settlement and
release agreement whereby the Borrower's interest in H Pharmaceuticals K/S has
been reduced to fifteen percent (15%) (subject to further dilution for
subsequent H Pharmaceuticals K/S financings), the warrants for Borrower common
stock and call option to purchase shares of Borrower stock held by Nordic have
been cancelled, and the Borrower is to receive a payment of approximately
$500,000 from Nordic ($100,000 within 5 business days of entering into that
settlement and release agreement and the remainder after this Waiver and
Forbearance Agreement becomes effective);

    

    NOW, THEREFORE, for and in
consideration of the premises, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Borrower and the
Lenders agree as follows:

     

    1.           The
Borrower hereby acknowledges, confirms, represents and warrants to Lenders as of
the date hereof that: (i) the outstanding aggregate principal balance of the
Notes is $1,725,000; (ii) said balance, together with interest accrued thereon
from the issue date of the Notes through and including the date hereof at the
rate set forth in the Notes, remains due and owing to the Lenders without
offset, defense or counterclaim; and (iii) each of the Loan Documents remains in
full force and effect and is enforceable in accordance with its respective
terms.

     

    2.           The
undersigned Lenders and the Borrower hereby agree as follows (which agreement
shall take effect immediately upon the receipt by the Company of the signatures
of holders of Notes representing at least a majority of the aggregate principal
amount of all of the Notes pursuant to Section 8(a) of the Notes (such date, the
“Effective
Date”)):

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    (a)           Lenders
agree that they shall not demand payment, exercise setoff rights or seek to
collect from the Borrower any obligations evidenced by the Note or join in any
petition or otherwise initiate any insolvency case, reorganization or any other
similar legal proceeding against the Borrower, and the Notes shall be deemed
modified such that the "Maturity Date," as such term is defined in each of the
Notes, shall be deemed to be December 31, 2011.  If requested by any
Lender, the Borrower shall promptly execute and deliver to said Lender an
amended and restated Note reflecting the terms of this Agreement.

     

    (b)           The
Lender’s Warrants will be modified upon obtaining the shareholder approval in
connection with the Subsequent Offering to include a full-ratchet anti-dilution
provision and a reduction in the cash exercise price thereof to $0.01 per
share.  Following the applicable date of the foregoing, Borrower shall
promptly execute and deliver to the Lenders an amended and restated Warrant
reflecting the foregoing terms.

     

    (c)           Promptly
following the Effective Date, the Company agrees to take prompt steps to
commence the Subsequent Offering.

     

    (d)           The
Designated Default is hereby waived.

     

    (e)           Subject
to Section 2(a) above, Lenders reserves the right, in their respective
discretion, to exercise any or all of its rights and remedies arising under the
Loan Documents, applicable law or otherwise, as a result of any Events of
Default occurring after the date hereof.  Subject to Section 2(a)
hereof, nothing contained herein shall be construed as a waiver of the failure
of the Borrower to comply with the terms of the Loan Documents after the date
hereof.

     

    3.           The
Borrower represents and warrants that it has the right, power and capacity and
is duly authorized and empowered to enter into, execute, deliver and perform
this Agreement.

     

    4.           All
notices to be given pursuant to this Agreement shall be in writing and
sufficient if given in accordance with the provisions of the Security
Agreement.

     

    5.           This
Agreement and all substantive terms and provision hereof shall be governed by
and construed according to the laws of the State of New York without regard to
the conflicts of laws principles thereof.

     

    6.           THE
BORROWER AND THE LENDERS HEREBY AGREE THAT ANY ACTION, SUIT OR PROCEEDING IN
RESPECT OF OR ARISING OUT OF THIS AGREEMENT SHALL BE INITIATED AND PROSECUTED IN
THE STATE OR FEDERAL COURTS, AS THE CASE MAY BE, LOCATED IN THE COUNTY AND STATE
OF NEW YORK, AND CONSENT TO AND SUBMIT TO THE EXERCISE OF JURISDICTION OVER THE
SUBJECT MATTER.  THE BORROWER AND EACH LENDER HEREBY WAIVE PERSONAL
SERVICE OF ANY AND ALL PROCESS UPON THEM AND CONSENT THAT ALL SUCH SERVICE OF
PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL DIRECTED TO THE ADDRESS FOR
THE BORROWER OR SUCH LENDER, AS THE CASE MAY BE, SET FORTH IN THE SECURITY
AGREEMENT, AS SAID ADDRESS MAY BE CHANGED FROM TIME TO TIME IN ACCORDANCE WITH
THE PROVISIONS THEREOF.

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

     

    IN
ANY ACTION, SUIT OR PROCEEDING IN RESPECT OF OR ARISING OUT OF THIS AGREEMENT,
THE BORROWER AND THE LENDERS HEREBY WAIVE TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM, WHETHER IN CONTRACT, TORT OR OTHERWISE, RELATING
DIRECTLY OR INDIRECTLY TO THIS AGREEMENT, THE LOANS EVIDENCED BY THE NOTES, THE
OTHER LOAN DOCUMENTS, OR ANY ACTS OR OMISSIONS OF THE BORROWER, THE LENDERS, OR
ANY OF THEM, OR ANY OF THEIR RESPECTIVE OFFICERS, EMPLOYEES, DIRECTORS,
MANAGERS, PARTNERS, TRUSTEES OR AGENTS IN CONNECTION THEREWITH. THIS WAIVER OF
RIGHT TO TRIAL BY JURY IS GIVEN KNOWINGLY AND VOLUNTARILY BY THE BORROWER AND
THE LENDERS, AND IS INTENDED TO ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH
ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY JURY WOULD OTHERWISE
ACCRUE.

     

    7.           The
Borrower and the Lenders signatory hereto acknowledge and agree that, pursuant
to Section 8(a) of the Notes, this Agreement binds, and is intended to bind, all
Lenders when executed and delivered by the Borrower and the "Requisite Holders"
(as defined in the Notes).

     

    8.           Except
as herein specifically set forth, all terms, covenants and provisions contained
in the Loan Documents remain in full force and effect and are hereby ratified
and confirmed.

     

    9.           TIME IS OF THE ESSENCE WITH RESPECT
TO THE OBLIGATIONS OF THE BORROWER HEREUNDER.

     

    10.           This
Agreement may not be changed or terminated orally. The covenants contained in
this Agreement bind the Borrower, the Lenders, and their respective heirs,
personal representatives, successors and assigns, and shall inure to the benefit
of the Lenders, their respective personal representatives, successors and
assigns.

     

    11.           In
the event of any conflict between the terms, covenants and provisions hereof and
of any of the Loan Documents, the provisions hereof shall govern and
control.

     

    12.           Separate
counterparts of this Agreement may be executed, each of which shall be deemed an
original, and all of which, taken together, shall constitute but one and the
same Agreement.  Signatures delivered by telecopier or by .pdf email
attachment shall have the same force and effect as original
signatures.

     

    

    [signature
pages follow]

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

    

    IN WITNESS WHEREOF, this
Agreement has been duly executed by the parties hereto the date first above
written.

    

    
      
        	 	THE BORROWER	 
	 	 	 	 
	 	
                MANHATTAN
      PHARMACEUTICALS, INC.

              	 
	 	 	 	 
	
                 

              	
                By:
      

              	/s/ Michael
      McGuinness	 
	 	 	

                Name:
      Michael McGuinness

              	 
	 	 	

                Title:
      Chief Operating and Financial Officer

              	 

      

    

    :

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

    

    
      
        
          	 	

                  THE
      LENDERS:

                	 
	 	 	 	 
	 	 	 	 
	 	 	 
	 	Neel
      B. Ackerman	 
	 	 	 
	 	 	 
	 	
                  Martha
      N. Ackerman

                	 
	 	 	 
	 	 	 
	 	 	 
	 	Stephen
      M. Burnich Revocable Trust u/a 10/08/04	 
	 	 	 
	
                   

                	
                  By:
      

                	 	 
	 	 	Stephen
      M. Burnich, Trustee	 
	 	 	 	 
	 	 	 	 
	 	 	 
	 	

                  Ennio
      De Pianto

                	 
	 	 	 
	 	 	 
	 	

                  Matthew
      Ernst

                	 
	 	 	 
	 	 	 
	 	

                  John
      M. Goodman Living Trust

                	 
	 	 	 
	 	By:	 	 
	 	 	John
      M. Goodman, Trustee	 
	 	 	 	 
	 	 	 	 
	 	 	 
	 	

                  Leon
      Kanner

                	 
	 	 	 
	 	 	 
	 	

                  Rosemary
      Kanner

                	 
	 	 	 
	 	 	 
	 	

                  Richard
      Kindt

                	 

        

         

        
          
            
            

          

          
            -6-

            
              

            

          

          
            
            

          

        

      

       

      
        
          	 	 	 
	 	
                  Douglas
      E. Pritchett

                	 
	 	 	 
	 	 	 
	 	

                  Jerome
      A. Shinkay

                	 
	 	 	 
	 	 	 
	 	

                  Michael
      J. Spezia

                	 
	 	 	 
	 	 	 
	 	

                  George
      D. Wilson

                	 
	 	 	 
	 	 	 
	 	

                  Diane
      J. Wilson

                	 
	 	 	 
	 	 	 
	 	

                  Joseph
      L. Jerger

                	 
	 	 	 
	 	 	 
	 	

                  David
      Pudelsky

                	 
	 	 	 
	 	 	 
	 	

                  Nancy
      Pudelsky

                	 
	 	 	 
	 	 	 
	 	

                  James
      R. Buck

                	 
	 	 	 
	 	 	 
	 	

                  John  O.
      Dunkin

                	 

        

         

        
          
            
            

          

          
            -7-

            
              

            

          

          
            
            

          

        

      

      
        
          	 	

                  

                    NFS/FMTC
      SEP IRA FBO Jay Jennings

                  

                	 
	 	 	 	 
	
                   

                	
                  By:
      

                	 	 
	 	 	Jay
      Jennings	 
	 	 	 	 
	 	 	 	 
	 	

                  Landmark
      Community Bank

                  Collateral
      Account FBO

                  Estate
      of Catherine Nasser

                	 
	 	 	 	 
	 	 	 	 
	 	

                  By:
      

                	 	 
	 	 	William
      K. Nasser, Jr., attorney-in-fact	 
	 	 	 	 
	 	 	 	 
	 	

                  Nasser
      Family Trust

                	 
	 	 	 	 
	 	By:	 	 
	 	 	William
      K. Nasser, Trustee	 

        

         

        
          
            
            

          

          
            -8-

            
              

            

          

          
            
            

          

        

        
          	 	 	 
	 	

                  James
      R. Kahn

                	 
	 	 	 
	 	 	 
	 	

                  Debra
      A. Kahn

                	 
	 	 	 
	 	 	 
	 	

                  A.
      Starke Taylor, Jr.

                	 
	 	 	 
	 	 	 
	 	

                  Carolyn
      Taylor

                	 
	 	 	 
	 	 	 
	 	

                  Mark
      Vollmer

                	 
	 	 	 
	 	 	 
	 	

                  Robert
      J. Guercio

                	 
	 	 	 
	 	 	 
	 	

                  Ralph
      Hanby

                	 
	 	 	 
	 	 	 
	 	

                  Robert
      E. Jacobson

                	 
	 	 	 
	 	 	 
	 	

                  Saralee
      Jacobson

                	 
	 	 	 
	 	 	 
	 	

                  Michael
      Cushing

                	 
	 	 	 
	 	 	 
	 	

                  Raymond
      Yarusi, Jr.

                	 
	 	 	 	 

        

      

       

      
        
          
          

        

        
          -9-

          
            

          

        

        
          
          

        

      

       

      
        
          	 	 	 
	 	

                  James
      C. Orr

                	 
	 	 	 
	 	 	 
	 	

                  Vernon
      L. Simpson

                	 
	 	 	 
	 	 	 
	 	

                  Michael
      Yokoyama & Jaye Venuti Family Trust

                	 
	 	 	 
	 	 	 	 
	
                   

                	
                  By:
      

                	 	 
	 	 	Michael
      Yokoyama, Trustee	 
	 	 	 	 
	 	 	 	 
	 	

                  By:
      

                	 	 
	 	 	Jaye
      Venuti, Trustee	 
	 	 	 	 
	 	 	 
	 	 	 
	 	

                  Frederick
      Peet

                	 
	 	 	 
	 	 	 
	 	

                  Ronald
      Rasmussen

                	 
	 	 	 
	 	 	 
	 	

                  Lewis
      R. Jacobson

                	 
	 	 	 
	 	 	 
	 	

                  Mark
      B. Ginsburg

                	 
	 	 	 
	 	 	 
	 	

                  Gregory
      Dovolis

                	 
	 	 	 
	 	 	 
	 	

                  William
      S. Silver

                	 
	 	 	 
	 	 	 
	 	

                  Praful
      Desai

                	 
	 	 	 
	 	 	 
	 	

                  Thomas
      Gemellaro

                	 
	 	 	 
	 	 	 
	 	

                  Howard
      Tanning Rollover IRA

                	 
	 	 	 
	 	

                  By:
      

                	 	 
	 	 	                               
      , Custodian	 

        

      

      

      
        
          
          

        

        
          -10-Unassociated Document

     

    WARRANT
AGREEMENT

     

    PRIME
ACQUISITION CORP.

     

    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

            	 
      	
              2

            
	
              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

            	 
      	
              8

            
	
              Section
      10.

            	 
      	
              Obtaining
      Stock Exchange Listings; State Registration

            	 
      	
              8

            
	
              Section
      11.

            	 
      	
              Adjustment
      of Number of Warrant Shares.

            	 
      	
              8

            
	
              Section
      12.

            	 
      	
              Fractional
      Interests

            	 
      	
              14

            
	
              Section
      13.

            	 
      	
              Notices
      to Warrant Holders

            	 
      	
              14

            
	
              Section
      14.

            	 
      	
              Merger,
      Consolidation or Change of Name of Warrant Agent

            	 
      	
              15

            
	
              Section
      15.

            	 
      	
              Warrant
      Agent

            	 
      	
              15

            
	
              Section
      16.

            	 
      	
              Change
      of Warrant Agent

            	 
      	
              18

            
	
              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

            	 
      	
              20

            
	
              EXHIBIT
      A  [Form of Warrant Certificate]

            	 
      	
              A-1

            
	
              EXHIBIT
      B  LEGEND FOR PRIVATE WARRANTS

            	 
      	
              B-1

            
	
              EXHIBIT
      C  FEE SCHEDULE

            	
                

            	
              C-1

            

    

    

      
        
           

        

        
          -i-

          
            

          

        

        
           

        

      

    

     

    WARRANT
AGREEMENT

     

    This
Warrant Agreement (this “ Agreement ”) is made as of
[●], 2011 between Prime Acquisition Corp., a Cayman Islands exempted company
(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. [_____] on Form F-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 of the Company’s ordinary shares, par value $0.001 per share
(“ Common Stock ”), and
one-half of a warrant, each full warrant to purchase one share of Common Stock
at an exercise price of $7.50 per share (“ Public
Warrants”);

     

    WHEREAS,
on February 4, 2010 and February 12, 2010, for aggregate consideration of
$1,408.75, the Company issued in a private placement an aggregate of 1,408,751
units, each unit (the “ Founders’ Units ,” which term
shall include any additional units issued by way of dividend prior to issuance
of the Units) consisting of one share of Common Stock and one-half of a warrant,
each full warrant to purchase one share of Common Stock at an exercise price of
$7.50 per share (the “ Founders’ Warrants ,” which
term shall include any additional warrants issued by way of a dividend prior to
the issuance of the Units) to the following persons: (i)  422,625
Founder’s Units to Yong Hui Li, (ii)  422,625 Founder’s Units to Diana
Chia-Huei Liu, (iii)  295,838 Founder’s Units to The Shodan Company
(including 14,088 Founders’ Units originally issued to Nancy Tung),
(iv)  140,875 Founder’s Units to Gary Han-Min Chang,
(v)  49,306 Founders’ Units to Joseph Liu, (vi)  49,306
Founders’ Units to Steven Liu,  (vii) 14,088 Founders’ Units to Olivia
Yu, and (viii) 14,088 Founders’ Units to Joyce Liu;

     

    WHEREAS,
in May 2010, Nancy Tung transferred all of her Founder Units to The Shodan
Company;

    

    WHEREAS,
on November 7, 2010, for aggregate consideration of 155.25, the Company issued
in a private placement an aggregate of 155,249 Founders’ Units to the following
person: (i) 46,575 Founders’ Units to Diana Chia-Huei Liu, (ii) 79,177 Founders’
Units to William Tsu-Cheng Yu, (iii) 15,525 Founders’ Units to Gary Chang, (iv)
5,434 Founders’ Units to Joseph Liu, (v) 5,434 Founders’ Units to Steven Liu,
(vi) 1,552 Founders’ Units to Olivia Yu, and (vii) 1,552 Founders’ Units to
Joyce Liu;

    

    WHEREAS,
in November 2010, Yong Hui Li transferred 31,625 Founders’ Units to William
Tsu-Cheng Yu, The Shodan Company transferred 92,518 Founders’ Units to William
Tsu-Cheng Yu, and Gary Chang transferred 156,400 Founders’ Units to Puway
Limited (together with Diana Chia-Huei Liu, William Tsu-Cheng Yu, Gary Chang,
Joseph Liu, Steven Liu, Olivia Yu, Joyce Liu, and The Shodan Company, the “
Founding
Shareholders”).

     

    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 1,092,533
warrants to purchase shares of Common Stock (the “ Insider Warrants ” and
together with the Founder’s Warrants, the “ Private Warrants ”) to Chardan
Capital Markets, LLC, the representative of the underwriters of the Initial
Public Offering (the “ Underwriter ”), Yong Hui Li,
Diana Chia-Huei Liu, The Shodan Company, and  Gary Han-Min Chang
(collectively, the “ Private
Placement Warrantholders ”), and (ii) up to 2,300,000 full Public
Warrants (together with the Private 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 Private 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 Founders’ Warrants may not be sold or transferred for a period of nine (9)
months from the date the Company completes its initial business combination (as
described more fully in the Registration Statement) ( the “Initial Business
Combination”) with respect to 50% of the Founders’ Warrants owned by each
Founding Shareholder, and twelve (12) months from the date the Company completes
its Initial Business Combination with respect to the remaining 50% of the
Founders’ Warrants owned by each Founding Shareholder, except to a Permitted
Transferee who agrees in writing with the Company to be subject to such transfer
restrictions.

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

    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.

     

    5.4    
    The holders of any Private Warrants or Warrant Shares issued
upon exercise of any Private 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 one-half of a 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 6-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.
Upon separation of the Units by a holder, the number of Warrants issuable upon
separation of the Units shall be rounded down to the nearest whole Warrant. In
no event may a Warrant Certificate for a partial Warrant be issued.

    

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    

    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.

     

    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 $7.50 per
share, and each full 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, rounded down to the nearest whole
Warrant.  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 completes its Initial Business Combination, 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)          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.

     

    (e)           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 equalled or exceeded $15.00 (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 that is 10 trading days prior to
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.

     

    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)           The
Founding Shareholders and their permitted transferees may settle any Founders’
Warrants, and the Private Placement Warrantholders and their permitted
transferees may settle and Insider Warrants, on a cashless basis 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.

    

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    

    (c)          Subject
to the provisions of Section 7, upon surrender of Warrants and payment of the
Exercise Price, 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 together with cash as provided in
Section 12 hereof.  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.

     

    (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.

     

    (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 Founders’ 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.

     

    (h)          Certificates
evidencing Warrant Shares issued upon exercise of an Insider Warrant must bear
the following legends:

    

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    

    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.

     

    6.4   
       Registration
Requirement .  Notwithstanding anything else in this Section 6,
no Public Warrants may be exercised 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 Private 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.  If any such post-effective amendment or
registration statement has not been declared effective prior to the 90 day
anniversary of the closing of the Initial Business Combination holders of the
Warrants shall have the right, during the period beginning on the next business
day following the 90 day anniversary of the closing of the Initial Business
Combination and ending upon such post-effective amendment or registration
statement being declared effective by the SEC, and during any other period after
the 90 day anniversary of the closing of the Initial Business Combination when
the Company shall fail to have maintained an effective registration statement
covering the Common Stock issuable upon exercise of the Warrants, to exercise
such Warrants on a cashless basis (in accordance with Section 3(a)(9) of the Act
or another exemption) 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.

    

    The date
that notice of cashless exercise is received by the Warrant Agent shall be
conclusively determined by the Warrant Agent. If in compliance with applicable
securities laws, the Company shall provide the Warrant Agent with an opinion of
counsel for the Company (which shall be an outside law firm with securities law
experience) stating that the exercise of the Warrants on a cashless basis in
accordance with this Section 6.4 is not required to be registered under the Act.
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 Private Warrant
or Founders’ Warrant, if, at the time of such exercise, there is not an
effective registration statement or current prospectus covering the Warrant
Shares underlying such Private 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.

     

    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.

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    

    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 and shall provide or otherwise make
available any cash which may be payable as provided in Section 12
hereof.  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.

     

    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.

    

     

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    

    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.

     

    (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:

    

     

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    

    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.

     

    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: 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),  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 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;

    

     

    
      
         

      

      
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    (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.

     

    (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.

    

     

    
      
         

      

      
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    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.

     

    11.8    
    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.

    

     

    
      
         

      

      
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    (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 be 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 (i) 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 and
(ii) paying to such holder any amount in cash in lieu of a fractional share
pursuant to Section 12; 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, other capital stock and cash
upon the occurrence of the event requiring such adjustment.

     

    11.11  
    Adjustment in Exercise
Price .

     

    (a)           Upon
each event that provides for an adjustment of the number of shares of Common
Stock issuable upon exercise of each Warrant pursuant to this Section 11, each
Warrant outstanding prior to the making of the adjustment is to thereafter have
an adjusted Exercise Price (calculated to the nearest ten millionth) obtained
from the following formula:

     

    E’ = E x
(N / N’)

     

    where:

     

    E’
=        the adjusted Exercise
Price.

     

    E
=         the Exercise Price prior
to adjustment.

     

    N’
=       the adjusted number of Warrant Shares
issuable upon exercise of a Warrant by payment of the adjusted Exercise
Price.

     

    N
=        the number of Warrant Shares
previously issuable upon exercise of a Warrant by payment of the Exercise Price
prior to adjustment.

     

    (b)           Whenever
the Exercise Price is adjusted pursuant to this Section 11.11, the Redemption
Threshold shall be adjusted to be equal to 200% of the Exercise
Price.

     

    (c)           Following
any adjustment to the Exercise Price pursuant to this Section 11, the
amount payable, when adjusted and together with any consideration allocated to
the issuance of the Warrants, is to never be less than the par value per Warrant
Share at the time of such adjustment.  Such adjustment is to be made
successively whenever any event listed above occurs.

    
      
         

      

      
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    11.12  
    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.

     

    13.2    
   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;

    

     

    
      
         

      

      
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    (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.

     

    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.

    

     

    
      
         

      

      
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    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.

     

    15.5   
    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.

    

     

    
      
         

      

      
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    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.

     

    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 is 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.

    

     

    
      
         

      

      
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    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.

     

    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:

     

    Prime
Acquisition Corp.

    No. 322,
Zhongshan East Road

    Shijiazhuang

    Hebei
Province, 050011

    People’s
Republic of China

    Fax
No.:  [●]

    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:

    

     

    
      
         

      

      
        18

        
          

        

      

      
         

      

    

    

    American
Stock Transfer & Trust Company

    6201
15th
Avenue

    Brooklyn, NY 11219

    Fax: [●]

    Attention:  Compliance
Department

     

    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 Private 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.

    

     

    
      
         

      

      
        19

        
          

        

      

      
         

      

    

    

    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.

     

    [ Signature page follows
]

    
      
         

      

      
        20

        
          

        

      

      
         

      

    

    

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

     

    
      
        
          	
                  PRIME
      ACQUISITION CORP.

                
	 
      	 
      
	
                  By:

                	
                     

                
	
                  Name:

                
	
                  Title:

                

        

      

    

     

    AMERICAN STOCK TRANSFER & TRUST
COMPANY , as Warrant Agent

     

    
      
        
          	
                  By:

                	
                      

                
	
                  Name:

                
	
                  Title:

                

        

      

    

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

     

    EXHIBIT
A

     

    [Form
of Warrant Certificate]

    

     

    
      
         

      

      
        A-1

        
          

        

      

      
         

      

    

    

    [Form of
Warrant Certificate]

     

    [Reverse]

    

     

    

    
      
         

      

      
        A-2

        
          

        

      

      
         

      

    

     

    EXHIBIT
B

     

    LEGEND
FOR PRIVATE WARRANTS

     

    THE
SECURITIES REPRESENTED BY THIS CERTIFICATE (INCLUDING THE ORDINARY SHARES 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 ORDINARY SHARES 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. 1

     

    No. _____
_______ Warrants

    

     

    
      
         

      

      
        B-1

        
          

        

      

      
         

      

    

    

    EXHIBIT
C

     

    Warrant
Agent Fees

    

    
      
        
          	
                  Description

                	 
      	
                  Amount
      ($)

                
	 
      	 
      	 
      
	
                  Fee
      for acting as Warrant Agent

                	 
      	
                  [_____]

                

        

      

    

     

    
      
         

      

      
        B-1

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