CONFIDENTIAL- WITHOUT PREJUDICE-NOT TO BE USED IN LITIGATION** SUBSCRIPTION AND RELEASE AGREEMENT
**CONFIDENTIAL-
WITHOUT PREJUDICE-NOT TO BE USED IN LITIGATION**
This
Subscription and Release Agreement (the “Agreement”)
is
provided to _______________________________ (sometimes referred to herein
as the
“Investor” or “you” or “your”), as record owner of shares of common stock, par
value $.001 per share (the “Common
Stock”)
and
Redeemable Common Stock Purchase Warrants exercisable at $2.00 per share
(as
amended from time to time, the “Warrants”)
of
China Broadband, Inc., f/k/a Alpha Nutra, Inc., a Nevada corporation (the
“Company”).
BACKGROUND
As
a
result of a series of negotiations on behalf of the Company, its principals
and
advisors, a series of events have occurred which are more fully described
in a
Confidential Investor Update (the “Investor
Letter”),
dated
as of January 31, 2008 and in various Current Reports on Form 8-K filed with
the
Securities and Exchange Commission. As a result of the foregoing, the Company
has agreed to a modification of your Warrant so as to extend the expiration
date
of your warrant from March 24, 2009, the current expiration date, to January
11,
2013, the Closing date of a recent convertible Note Financing, in return
for the
release by you of any claims relating to the Company, its management and
certain
affiliates and consultants. A copy of the form of Warrant Amendment is annexed
hereto as Exhibit
A (the
“Warrant
Amendment”).
You
should not complete or execute this Agreement without first carefully reviewing
this Agreement and all of the reports of the Company filed via ▇▇▇▇▇ with
the
Securities and Exchange Commission to date (the “Reports”)
the
provisions of which (including, without limitation, risks and disclosure
relating to forward looking statements) are incorporated herein.
The
Warrant Amendment described below is being offered for sale pursuant to an
exemption from the registration provisions of the Securities Act of 1933,
as
amended (the "Securities
Act")
and in
particular, Regulation D. The term “Securities”
shall
be deemed to include both the Warrant Amendment and the shares of Common
Stock
issuable upon exercise of the Warrant.
1. Warrants.
The
Investor hereby acknowledges its or his ownership of Warrants to Purchase
_____________ shares of Common Stock as represented by Warrant Certificate
No.
A-_____. In exchange for the releases provided hereby, Investor hereby accepts
and acquires the Warrant Amendment.
2.
Releases
of Investor
2.1
Investor
Releases.
The
Investor, for itself, its owners, and past and present affiliates and assigns
(collectively, “Investor
Parties”)
hereby
forever RELEASES AND DISCHARGES the Company, WestPark Capital, Inc., Wellfleet
Partners, Inc., Chardan Capital Markets, LLC, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Maxim
Financial Corporation, BCGU, LLC, Jaguar Acquisition Corporation, China Cablecom
Holdings, Ltd., China Cablecom, Ltd., and each of their respective past and
present officers, directors, employees, shareholders, managers, members,
partners, consultants, attorneys, accountants, auditors, successors and assigns
in any capacity (collectively, “Released
Parties”)
of and
from all actions, causes of action, suits, debts, sums of money, claims for
breaches of contract fiduciary duties or conflicts of interest, claims for
violations of securities laws or regulations, compensation, covenants,
controversies, agreements, trespasses, damages (compensatory, consequential,
liquidated, special, punitive or otherwise), judgments, executions, and demands
(including attorneys’ fees and costs) of any nature whatsoever, in law,
admiralty or equity, against the Released Parties that the Investor Parties
ever
had, now have or hereafter can, shall or may have, whether known or unknown,
for, upon, or by reason of any matter.
2.2 The
Investor Parties further agree not to institute, instigate, urge, support,
encourage, voluntarily participate in or profit from any lawsuit, complaint
or
other action or proceeding of any kind relating to any matter to which this
General Release pertains.
2.3 With
respect to any and all released claims, the Investor stipulates and agrees
that
it/he/they expressly waive the provisions, rights and benefits of California
Civil Code §1542, which provides:
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A
general release does not extend to claims which the creditor does not know
or
suspect to exist in his or her favor at the time of executing the release,
which
if known by him or her must have materially affected his or her settlement
with
the debtor.
The
Investor Parties expressly waive any and all provisions, rights and benefits
conferred by any law of any state or territory of the United States, or
principle of common law, which is similar, comparable or equivalent to
California Civil Code §1542. The Investor Parties may hereafter discover facts
in addition to or different from those which he, she or it now knows or believes
to be true with respect to the subject matter of the released claims, but
the
Investor Parties have fully, finally, and forever settled and released any
and
all released claims, known or unknown, suspected or unsuspected, contingent
or
non-contingent, whether or not concealed or hidden, which now exist, or
heretofore have existed, upon any theory of law or equity now existing or
coming
into existence in the future, including, but not limited to, conduct which
is
negligent, intentional, with or without malice, or a breach of any duty,
law or
rule, without regard to the subsequent discovery or existence of such different
or additional facts. The Investor Parties acknowledge that the foregoing
waiver
was separately bargained for and a key element of the contract of which this
release is a part.
2.4 Reliance
on Professional Advice.
Investor represents and warrants that it/he/she: (a) has carefully read this
Agreement, knows the contents thereof and has had an opportunity to review
the
same with its legal counsel and professional tax advisors prior to execution
of
this Agreement, and is executing the same freely and voluntarily; (b) fully
understands the legal an tax ramifications of the terms and provisions of
this
Agreement; (c) has not relied upon any representation or statement not contained
in this Agreement or in the Reports or that it has otherwise received in
writing
from the Company; and (d) is aware that it or his respective attorneys may
hereafter discover facts different from or in addition to the facts that
they
now know or believe to be true but that its intention is to fully and finally
release the Released Parties.
3. Securities
Representations and Warranties of Investor Under Regulation D.
The
offer and sale of the Securities hereby is being made by the Company in reliance
on exemptions from the registration requirements of the Securities Act.
Accordingly, each Investor hereby represents, warrants and covenants with
the
Company as follows:
3.1 Accredited
Investor.
The
Investor is either an “Accredited Investor”, as such term is defined in Rule 501
of Regulation D of the Securities Act.
3.2 Legal
Power.
Each
Investor has the requisite individual, corporate, partnership, limited liability
company, trust, or fiduciary power, as appropriate, and is authorized, if
such
Investor is a corporation, partnership, limited liability company, or trust,
to
enter into this Agreement, to grant the releases sought herein and to acquire
and accept the Warrant Amendment, and to carry out and perform its obligations
under this Agreement.
3.2 Due
Execution.
This
Agreement has been duly authorized, if such Investor is a corporation,
partnership, limited liability company, trust or fiduciary, executed and
delivered by such Investor, and, upon due execution and delivery by the Company,
this Agreement will be a valid and binding agreement of such
Investor.
3.3 Access
to Information.
Investor has reviewed this Agreement and the Reports. Each Investor represents
that such Investor has been given full and complete access to the Company
and to
all materials relating to the business, finances and operations of the Company
and materials relating to the offer and sale of the Warrant Amendment herein
which have been requested by Investor or its advisors. Investor represents
that
such Investor has been afforded the opportunity to ask questions of, and
has
inquired with, the officers of the Company and its representatives regarding
its
business prospects and the Securities, all as such Investor or such Investor’s
qualified representative have found necessary to make an informed investment
decision to enter into this Agreement and/or acquire the Securities.
Neither
such inquiries nor any other due diligence investigation conducted by Investor
or any of its advisors or representatives shall modify, amend or affect
Investor’s right to rely on the Company’s representations and warranties
contained herein.
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3.4 Restricted
Securities.
3.4.1 Each
Investor has been advised that the Securities have not been registered under
the
Securities Act or any other applicable
securities laws and that Warrant
Amendment (and, upon exercise of the Warrant as so amended, the shares
underlying the Warrants) is being offered and sold pursuant to Section 4(2)
of
the Securities Act and/or Rule
506
of Regulation D thereunder, and that the Company’s reliance upon Section 4(2)
and/or Rule 506 of Regulation D is predicated in part on such Investor
representations as contained herein.
Each
Investor acknowledges that the Securities will be issued as “restricted
securities” as defined by Rule 144 promulgated pursuant to the Securities Act.
None of the Securities may be resold in the absence of an effective registration
thereof under the Securities Act and applicable state securities laws unless,
in
the opinion of the Company’s counsel, an applicable exemption from registration
is available.
3.4.2 Each
Investor represents that such Investor is acquiring the Securities for such
Investor’s own account, and not as nominee or agent, for investment purposes
only and not with a view to, or for sale in connection with, a distribution,
as
that term is used in Section 2(11) of the Securities Act, in a manner which
would require registration under the Securities Act or any state securities
laws.
3.4.3 Each
Investor understands and acknowledges that the Warrant Amendment when issued
and, upon exercise of the Warrants the Warrant Shares, will bear substantially
the following legend:
THE
SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE.
THE
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD OR TRANSFERRED
FOR VALUE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION THEREOF UNDER THE
SECURITIES ACT OF 1933 AND/OR THE SECURITIES ACT OF ANY STATE HAVING
JURISDICTION OR AN OPINION OF COUNSEL ACCEPTABLE TO THE CORPORATION THAT
SUCH
REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR ACTS.
3.4.4 Each
Investor acknowledges that an investment in the Securities is not liquid
and is
transferable only under limited conditions. Each Investor acknowledges that
such
securities must be held indefinitely unless they are subsequently registered
under the Securities Act or an exemption from such registration is available.
3.5 Investor
Sophistication and Ability to Bear Risk of Loss.
Each
Investor acknowledges that it is able to protect its interests in connection
with the acquisition of the Warrant
Amendment and entry into this Agreement and can bear the economic risk of
investment in such securities without producing a material adverse change
in
such Investor’s financial condition. Each Investor, either alone or with such
Investor’s representative(s), otherwise has such knowledge and experience in
financial or business matters that such Investor is capable of evaluating
the
merits and risks of entry into this Agreement and an investment in
the
Warrant
Amendment.
3.6 Preexisting
Relationship.
Each
Investor has a preexisting personal or business relationship with the Company,
one or more of its officers, directors, or controlling persons, or WestPark
Capital, Inc. (as defined herein).
3.7 Purchases
by Groups.
Each
Investor represents, warrants and covenants that it is not entering into
this
Agreement or acquiring the Warrant Amendment as part of a group within the
meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended.
4.
Miscellaneous
4.1
All
notices or other communications given or made hereunder shall be in writing
and
shall be delivered by hand or mailed by registered or certified mail, return
receipt requested, postage prepaid, to the undersigned, at the address set
forth
on the signature page hereto, and to the Company at the address of the Company
on the cover page of the most recent Report at the time of giving
notice.
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4.2 This
Agreement shall be governed by and construed in accordance with the laws
of the
state of New York applicable to contracts made and wholly performed in that
state. Any
subsequent action to enforce the terms of this Agreement may be brought in
any
State or Federal court located in Manhattan, New York, and, if any such action
is brought in a State or Federal Court located in Manhattan, New York, no
Party
shall dispute that such court is the proper venue for the action or that
the
Party is subject to personal jurisdiction in such court for purposes of the
action.
4.3.
This
Agreement constitutes the entire agreement among the parties hereto with
respect
to the subject matter hereof and
supersedes all prior agreements and understandings among the parties with
respect to such subject matter. This Agreement may not be changed, modified
or
amended except by a written instrument signed by the Party to be charged
with
such change, modification or amendment.
4.4 This
Agreement is not transferable or assignable by the Investor.
4.5 All
references in this Agreement to the "Investor" shall include all parties
(other
than the Company) who execute this Agreement. If the Investor is a corporation,
partnership, trust or two or more individuals purchasing jointly, note the
specific instructions for the Certificate of Signatory at the end hereof.
Please
date and sign the certificate.
4.6 Each
party hereto, at the reasonable request of another party hereto, shall execute
and deliver such other instruments and do and perform such other acts and
things
as may be reasonably necessary for effecting completely the consummation
of this
Agreement and the transactions contemplated hereby.
4.7 This
Agreement may be executed in any number of counterparts, each of which shall
be
deemed an original, but all of which together shall constitute one and the
same
instrument. This agreement may executed and deemed binding when executed
and
delivered by facsimile or electronic copy of the actual executed Agreement
(such
as Adobe, efax or similar copying and transmitting software).
4.8 This
Agreement shall be binding on the Parties hereto and their respective
predecessors, successors, assigns, parents, subsidiaries, affiliates, divisions,
groups and present and former officers, directors, securityholders, and
employees.
[Signature
Pages Follow]
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SIGNATURE
PAGE TO SUBSCRIPTION AND RELEASE AGREEMENT
IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date
set
forth on the Purchase Signature Page hereto.
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INVESTOR
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(By
Counterpart Form - See Investor Signature
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Pages
That Follow)
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COMPANY
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CHINA
BROADBAND, INC.
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(By
Execution of Acceptance Page following
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Certificate
of
Signatory)
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INVESTOR
SIGNATURE PAGE TO SUBSCRIPTION AND RELEASE AGREEMENT
(For
Individuals)
This
Release and Warrant Modification Agreement (including the Questionnaire)
is
hereby executed and entered into by the below Investor.
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Witness
(signature)
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Signature
(Individual)
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Witness
(print name)
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Name
(Print)
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Street
address
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Witness
(signature)
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City,
State and Zip Code
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Witness
(print name)
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( )
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Telephone
Number
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Date
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Number
of Warrants Held:
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Warrant
Number: A-
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INVESTOR
SIGNATURE PAGE TO SUBSCRIPTION AND RELEASE AGREEMENT
(for
Corporation, Partnership, Trust or Other Entities)
This
Release and Warrant Modification Agreement is hereby executed and entered
into
by the below Investor:
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Witness
(signature)
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Name
of Entity*
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Witness
(print name)
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Type
of Entity (i.e., corporation, partnership, etc.)
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State
of Formation of Entity
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Witness
(signature)
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Name
of Signatory Typed or Printed
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Witness
(print name)
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Its: |
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Title
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Date
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Address
to Which Correspondence Should Be Directed
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▇/▇
▇▇▇▇
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▇▇▇▇▇▇
▇▇▇▇▇▇▇
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( )
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Telephone
Number
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*If
this Agreement is being entered into by an entity, the Certificate of Signatory
that follows must also be completed.
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CERTIFICATE
OF SIGNATORY
To
be
completed if Agreement is being executed by an entity
I,__________________________________,
am the___________________________of (the
“Entity”).
I
certify
that I am empowered and duly authorized by the Entity to execute and carry
out
the terms of the Subscription and Release Agreement (the “Agreement”)
relating to the releases granted by the Entity and acquisition of a Warrant
Amendment of China Broadband Inc. The Agreement has been duly and validly
executed on behalf of the Entity and constitutes a legal and binding obligation
of the Entity.
IN
WITNESS WHEREOF, I have hereto set my hand this ______ day of _________,
2008.
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Signature
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COMPANY
SIGNATURE PAGE TO SUBSCRIPTION AND RELEASE AGREEMENT
of
CHINA
BROADBAND, INC.
The
foregoing Subscription and Release Agreement of ______________________________
with respect to releases granted by such Investor and issuance of a Warrant
Amendment to such Investor with respect to _____________ warrants held by
such
Investor, is hereby AGREED AND ACCEPTED:
CHINA
BROADBAND, INC.
f/k/a
Alpha Nutra, Inc.
By:
Name:
Title:
Date:
_____________________, 200_
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Form
of Warrant Amendment - Exhibit
A
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AMENDMENT
TO REDEEMABLE COMMON STOCK PURCHASE WARRANT
This
Amendment Agreement (the “Amendment”), dated as of ______, 2008, amends that
certain Redeemable Common Stock Purchase Warrant, certificate No. 2007-A-
_____
(the “Warrant”) of China Broadband, Inc., f/k/a Alpha Nutra, Inc., a Nevada
corporation (the “Company”), issued in the name of
___________________________________ (the “Holder”) for the purchase of up to
_______________ shares of common stock, par value $.001 per share of the
Company
at $2.00 per share. All Capitalized terms not otherwise defined herein shall
have the meanings set forth in the Warrant.
R
E C I T
A L S
WHEREAS,
the
Holder owns the Warrant and has received, reviewed and executed the Subscription
and Release Agreement (the “Subscription Agreement”) between the Company and
Holder; and
WHEREAS,
the
Holder agrees to the terms of the Subscription Agreement and desires to extend
the exercisability term of the Warrants from March 24, 2009 to January 11,
2013,
as set forth herein.
NOW,
THEREFORE,
based
on the mutual premesis and consideration of the parties, the receipt and
sufficiency of which is hereby approved, Company hereby agrees as follows:
1. The
term
“Expiration Date”, as is currently defined in the Warrant is, and all references
thereto are, hereby modified and amended to be and read January 11, 2013.
2.
Section
1.8(a) of the Warrant is hereby amended and restated to be and read as follows:
“1.8 Company’s
Right to Call.
(a) Subject
to the provisions of clauses 1.8(b) below, in the event that: (A) the Fair
Market Value equals or exceeds 125% of the then applicable exercise price
of
this Warrant (the “Trigger Price”) and (B) the minimum daily trading volume of
the Common Stock is not less than 25,000 shares, each for a period of ten
10
consecutive trading days immediately prior to such notice, then the Company,
upon no less than twenty (20) business days’ prior written notice (the “Notice
Period”), may call this Warrant in whole or in part with respect to up to 100%
of the shares of Common Stock then purchasable pursuant to this Warrant at
a
redemption price equal to $.10 per share which right shall be exercisable
by the
Company commencing on March 24, 2008 and continuing through the Expiration
Date.
Notice by the Company of redemption may be made no more than fifteen (15)
days
after the end of the ten (10) day determination period. Notwithstanding any
such
notice by the Company, the Holder shall have the right to exercise this Warrant
prior to the end of the Notice Period.”
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IN
WITNESS WHEREOF, the Company and Holder have executed this Amendment as of
the
date first written above.
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CHINA
BROADBAND, INC.
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By:________________________
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Name:
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Title:
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HOLDER:
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____________________________
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(Print
Name)
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____________________________
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(Signature)
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____________________________
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(Title,
if Holder is an Entity)
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Warrant
No: 2007-A-__________
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_____________________________
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Number
of Warrants
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