FORM OF COMMON STOCK PURCHASE WARRANT To Purchase __________ Shares of Common Stock of HUIHENG MEDICAL, INC.
FORM
OF COMMON STOCK PURCHASE WARRANT
To
Purchase __________ Shares of Common Stock of
UNDER
NASD RULE 2710(g) AND SUBJECT TO LIMITED EXCEPTIONS, THIS WARRANT AND THE
UNDERLYING SHARES OF COMMON STOCK SHALL NOT BE SOLD DURING THE PUBLIC OFFERING,
AS HEREIN DEFINED, OR SOLD, TRANSFERRED, ASSIGNED, PLEDGED, OR HYPOTHECATED,
OR
BE THE SUBJECT OF ANY HEDGING, SHORT SALE, DERIVATIVE, PUT, OR CALL TRANSACTION
THAT WOULD RESULT IN THE EFFECTIVE ECONOMIC DISPOSITION OF THIS WARRANT OR
THE
SECURITIES UNDERLYING THIS WARRANT BY ANY PERSON FOR A PERIOD OF 180 DAYS
IMMEDIATELY FOLLOWING THE DATE OF EFFECTIVENESS OR COMMENCEMENT OF SALES OF
THE
PUBLIC OFFERING.
THIS
COMMON STOCK PURCHASE WARRANT CERTIFIES that, for value received, _________
(the
“Holder”),
is
entitled, upon the terms and subject to the limitations on exercise and the
conditions hereinafter set forth, at any time on or after _______ __, 2008
(the “Initial
Exercise Date”)
and on
or prior to the close of business on _______ __, 2013 (the “Termination
Date”)
but
not thereafter, to subscribe for and purchase from Huiheng Medical, Inc., a
corporation incorporated in the State of Nevada (the “Company”),
up to
________ shares (the “Warrant
Shares”)
of
Common Stock, par value $0.001 per share, of the Company (the “Common
Stock”).
The
purchase price of one share of Common Stock (the “Exercise
Price”)
under
this Warrant shall be $________
(115%
of
the initial public offering (“Offering”)
price
per share of Common Stock registered under the registration statement on Form
SB-2, as amended on Form S-1 (No. 333-146975) (the “Registration
Statement”)),
subject to adjustment hereunder.
1. Title
to Warrant.
Prior
to the Termination Date and subject to the transfer restrictions imposed by
NASD
Rule 2710(g) as set forth in the legend hereto, this Warrant and all rights
hereunder are transferable, in whole or in part, at the office or agency of
the
Company by the Holder in person or by duly authorized attorney, upon surrender
of this Warrant together with the Assignment Form annexed hereto properly
endorsed.
2. Authorization
of Shares.
The
Company covenants that all Warrant Shares which may be issued upon the exercise
of the purchase rights represented by this Warrant will, upon exercise of the
purchase rights represented by this Warrant, be duly authorized, validly issued,
fully paid and nonassessable and free from all taxes, liens and charges in
respect of the issue thereof (other than taxes in respect of any transfer
occurring contemporaneously with such issue).
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3. Exercise
of Warrant.
(a)
Except as provided in Section 4 herein, exercise of the purchase rights
represented by this Warrant may be made at any time or times on or after the
Initial Exercise Date and on or before the Termination Date by the surrender
of
this Warrant and the Notice of Exercise Form annexed hereto duly executed,
at
the office of the Company (or such other office or agency of the Company as
it
may designate by notice in writing to the registered Holder at the address
of
such Holder appearing on the books of the Company) and upon payment of the
Exercise Price of the shares thereby purchased by wire transfer or cashier’s
check drawn on a United States bank or by means of a “cashless exercise”
pursuant to Section 3(c), the Holder shall be entitled to receive a certificate
for the number of Warrant Shares so purchased. Warrant Shares purchased
hereunder shall be delivered to the Holder within three (3) business days after
the date on which this Warrant shall have been exercised as aforesaid. This
Warrant has been or will be registered on the Registration Statement and
accordingly, if this Warrant is exercised at a time when the Registration
Statement (or any registration statement registering the sale of the Warrant
Shares to the Holder upon exercise of this Warrant) is then effective and
available for use or if this Warrant is exercised by means of a “cashless
exercise” pursuant to Section 3(c) after ______, 2009 (such condition each a
“Condition”),
the
Company shall deliver the Warrant Shares to the Holder, if eligible, via the
Depository Trust Company’s (“DTC”)
Deposit Withdrawal Agent Commission (“DWAC”)
system
via the DTC instructions provided to the Company in the Notice of Exercise.
If
either Condition is met at the time of exercise, the Warrant Shares shall be,
when issued, unlegended and free of any resale restrictions. If no Conditions
are met at the time of such exercise, the certificates representing the Warrant
Shares shall be issued in paper form and contain a standard Securities Act
legend restricting resale without registration or an exemption. This Warrant
shall be deemed to have been exercised and such certificate or certificates
shall be deemed to have been issued, and the Holder or any other person so
designated to be named therein shall be deemed to have become a holder of record
of such shares for all purposes, as of the date the Warrant has been exercised
by payment to the Company of the Exercise Price and all taxes required to be
paid by the Holder, if any, pursuant to Section 5 prior to the issuance of
such
shares, have been paid.
(b) If
this
Warrant shall have been exercised in part, the Company shall, at the time of
delivery of the certificate or certificates representing Warrant Shares, deliver
to Holder a new Warrant evidencing the rights of Holder to purchase the
unpurchased Warrant Shares called for by this Warrant, which new Warrant shall
in all other respects be identical with this Warrant.
(c)
If,
but only if, at any time after the Initial Exercise Date the Registration
Statement (or a registration statement registering the sale of the Warrant
Shares to the Holder upon exercise of this Warrant) is not then effective or
unavailable for use as reasonably determined by the Company such that the
Company is unable to otherwise issue the Warrant Shares unlegended and free
of
any resale restrictions at such time, this Warrant may also be exercised at
such
time by means of a “cashless exercise” in which the Holder shall be entitled to
receive a certificate for the number of Warrant Shares equal to the quotient
obtained by dividing [(A-B) (X)] by (A), where:
(A)
= the
VWAP on the Trading Day preceding the date of such election;
(B)
= the
Exercise Price of the Warrant, as adjusted; and
(X)
= the
number of Warrant Shares issuable upon exercise of the Warrants in accordance
with the terms of this Warrant.
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“VWAP”
means,
for any date, the price determined by the first of the following clauses that
applies: (a) the daily volume weighted average price of the Common Stock for
such date (or the nearest preceding date) on the primary market or exchange
on
which the Common Stock is then listed or quoted as reported by Bloomberg
Financial L.P. (based on a Trading Day from 9:30 a.m. Eastern Time to 4:02
p.m.
Eastern Time); (b) if the Common Stock is not then listed or quoted on a
market or exchange and if prices for the Common Stock are then quoted on the
OTC
Bulletin Board, the volume weighted average price of the Common Stock for such
date (or the nearest preceding date) on the OTC Bulletin Board; (c) if the
Common Stock is not then listed or quoted on the OTC Bulletin Board and if
prices for the Common Stock are then reported in the “Pink Sheets” published by
the National Quotation Bureau Incorporated (or a similar organization or agency
succeeding to its functions of reporting prices), the average of the most recent
bid and ask price per share of the Common Stock so reported; or (d) in all
other cases, the fair market value of a share of Common Stock as determined
by a
nationally recognized-independent appraiser selected in good faith by
▇▇▇▇▇▇.
4. No
Fractional Shares or Scrip.
No
fractional shares or scrip representing fractional shares shall be issued upon
the exercise of this Warrant. As to any fraction of a share which Holder would
otherwise be entitled to purchase upon such exercise, the Company shall pay
a
cash adjustment in respect of such final fraction in an amount equal to such
fraction multiplied by the Exercise Price.
5. Charges,
Taxes and Expenses.
Issuance of certificates for Warrant Shares shall be made without charge to
the
Holder for any issue or transfer tax or other incidental expense in respect
of
the issuance of such certificate, all of which taxes and expenses shall be
paid
by the Company, and such certificates shall be issued in the name of the Holder
or in such name or names as may be directed by the Holder; provided,
however,
that in
the event certificates for Warrant Shares are to be issued in a name other
than
the name of the Holder, this Warrant when surrendered for exercise shall be
accompanied by the Assignment Form attached hereto duly executed by the Holder;
and the Company may require, as a condition thereto, the payment of a sum
sufficient to reimburse it for any transfer tax incidental thereto.
6. Closing
of Books.
The
Company will not close its stockholder books or records in any manner which
prevents the timely exercise of this Warrant, pursuant to the terms
hereof.
7. Transfer,
Division and Combination.
(a) Subject
to the transfer restrictions imposed by NASD Rule 2710(g) as set forth in the
legend hereto, this Warrant and all rights hereunder are transferable, in whole
or in part, upon surrender of this Warrant at the principal office of the
Company, together with a written assignment of this Warrant substantially in
the
form attached hereto duly executed by the Holder or its agent or attorney and
funds sufficient to pay any transfer taxes payable upon the making of such
transfer. Upon such surrender and, if required, such payment, the Company shall
execute and deliver a new Warrant or Warrants in the name of the assignee or
assignees and in the denomination or denominations specified in such instrument
of assignment, and shall issue to the assignor a new Warrant evidencing the
portion of this Warrant not so assigned, and this Warrant shall promptly be
cancelled. A Warrant, if properly assigned, may be exercised by a new holder
for
the purchase of Warrant Shares without having a new Warrant issued.
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(b) Subject
to the transfer restrictions imposed by NASD Rule 2710(g) as set forth in the
legend hereto, this Warrant may be divided or combined with other Warrants
upon
presentation hereof at the aforesaid office of the Company, together with a
written notice specifying the names and denominations in which new Warrants
are
to be issued, signed by the Holder or its agent or attorney. Subject to
compliance with Section 7(a), as to any transfer which may be involved in such
division or combination, the Company shall execute and deliver a new Warrant
or
Warrants in exchange for the Warrant or Warrants to be divided or combined
in
accordance with such notice.
(c) The
Company shall prepare, issue and deliver at its own expense (other than transfer
taxes) the new Warrant or Warrants under this Section 8.
(d) The
Company agrees to maintain, at its aforesaid office, books for the registration
and the registration of transfer of the Warrants.
8. Registration
Rights.
(a) Demand
Registration.
(i) Grant
of Right.
The
Company, upon written demand (“Initial
Demand Notice”)
of the
Holder(s) of at least 51% of the Warrants and/or the underlying shares of Common
Stock (“Majority
Holders”),
agrees to register on one occasion, all or any portion of the Warrants requested
by the Majority Holders in the Initial Demand Notice and all of the shares
of
Common Stock underlying such Warrants (collectively the “Registrable
Securities”).
On
such occasion, the Company will file a registration statement covering the
Registrable Securities within sixty (60) days after receipt of the Initial
Demand Notice and use its best efforts to have the registration statement
declared effective promptly thereafter. If the Company fails to comply with
the
provisions of this Section 8(a)(i), the Company shall, in addition to any other
equitable or other relief available to the Holder(s), be liable for any and
all
incidental, special and consequential damages sustained by the Holder(s). The
demand for registration may be made at any time during the five year period
commencing after the closing of the Offering (“Closing”).
The
Company covenants and agrees to give written notice of its receipt of any
Initial Demand Notice by any Holder(s) to all other registered Holders of the
Warrants and/or the Registrable Securities within ten days from the date of
the
receipt of any such Initial Demand Notice.
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(ii) Terms.
The
Company shall bear all fees and expenses attendant to registering the
Registrable Securities, but the Holders shall pay any and all underwriting
commissions and the expenses of any legal counsel selected by the Holders to
represent them in connection with the sale of the Registrable Securities. The
Company agrees to use its best efforts to cause the filing required herein
to
become effective promptly and to qualify or register the Registrable Securities
in such States as are reasonably requested by the Holder(s); provided, however,
that in no event shall the Company be required to register the Registrable
Securities in a State in which such registration would cause (a) the Company
to
be obligated to register or license to do business in such State or submit
to
general service of process in such State, or (b) the principal stockholders
of
the Company to be obligated to escrow their shares of capital stock of the
Company. The Company shall cause any registration statement filed pursuant
to
the demand right granted under Section 8(a)(1) to remain effective for a period
of at least twelve consecutive months from the date that the Holders of the
Registrable Securities covered by such registration statement are first given
the opportunity to sell all of such securities.
(b) “Piggyback”
Registration.
(i) Grant
of Right.
In
addition to the demand right of registration, the Holders of the Warants shall
have the unlimited right during the five year period commencing after the
Closing, to include the Registrable Securities as part of any other registration
of securities filed by the Company (other than in connection with a transaction
contemplated by Rule 145(a) promulgated under the Securities Act or pursuant
to
Form S-8 or any equivalent form) as long as such registration covers securities
with a market value on the date of the initial filing of such registration
statement in excess of $200,000; provided, however, that if, in the written
determination of the Company's managing underwriter or underwriters, if any,
for
such offering, the inclusion of the Registrable Securities, when added to the
securities being registered by the Company or the selling stockholder(s), will
exceed the maximum amount of the Company's securities which can be marketed
(a)
at a price reasonably related to their then current market value, or (b) without
materially and adversely affecting the entire offering, the Company shall
nevertheless register all or any portion of the Registrable Securities required
to be so registered but such Registrable Securities shall not be sold by the
Holders until 90 days after the registration statement for such offering has
become effective and provided further that, if any securities are registered
for
sale on behalf of other stockholders in such offering and such stockholders
have
not agreed to defer such sale until the expiration of such 90-day period, the
number of securities to be sold by all stockholders in such public offering
during such 90-day period shall be apportioned pro rata among all such selling
stockholders, including all holders of the Registrable Securities, according
to
the total amount of securities of the Company owned by said selling
stockholders, including all holders of the Registrable Securities.
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(ii) Terms.
The
Company shall bear all fees and expenses attendant to registering the
Registrable Securities, but the Holders shall pay any and all underwriting
commissions and the expenses of any legal counsel selected by the Holders to
represent them in connection with the sale of the Registrable Securities. In
the
event of such a proposed registration, the Company shall furnish the then
Holders of outstanding Registrable Securities with not less than thirty (30)
days’ written notice prior to the proposed date of filing of such registration
statement. Such notice to the Holders shall continue to be given for each
registration statement filed by the Company until such time as all of the
Registrable Securities have been sold by the Holder. The holders of the
Registrable Securities shall exercise the “piggyback” rights provided for herein
by giving written notice within twenty (20) days of the receipt of the Company's
notice of its intention to file a registration statement. The Company shall
cause any registration statement filed pursuant to the above “piggyback” rights
to remain effective for at least twelve months from the date that the Holders
of
the Registrable Securities are first given the opportunity to sell all of such
securities. The demand and “piggyback” rights set forth in this Section 8 shall
cease at such time that the underlying shares of Common Stock are saleable
under
Rule 144(k) promulgated under the Securities Act.
(c) General
Terms.
(i) Indemnification.
The
Company shall indemnify the Holder(s) of the Registrable Securities to be sold
pursuant to any registration statement hereunder and each person, if any, who
controls such Holders within the meaning of Section 15 of the Act or Section
20(a) of the Securities Exchange Act of 1934, as amended (“Exchange
Act”),
against all loss, claim, damage, expense or liability (including all reasonable
attorneys' fees and other expenses reasonably incurred in investigating,
preparing or defending against any claim whatsoever) to which any of them may
become subject under the Securities Act, the Exchange Act or otherwise, arising
from such registration statement but only to the same extent and with the same
effect as the provisions pursuant to which the Company has agreed to indemnify
the underwriters (“Underwriters”)
of the
Offering contained in Section 6 of the underwriting agreement (“Underwriting
Agreement”)
between the Representatives of the Underwriters and the Company, dated the
effective date of the Offering. The Holder(s) of the Registrable Securities
to
be sold pursuant to such registration statement, and their successors and
assigns, shall severally, and not jointly, indemnify the Company against all
loss, claim, damage, expense or liability (including all reasonable attorneys'
fees and other expenses reasonably incurred in investigating, preparing or
defending against any claim whatsoever) to which they may become subject under
the Securities Act, the Exchange Act or otherwise, arising from information
furnished by or on behalf of such Holders, or their successors or assigns,
in
writing, for specific inclusion in such registration statement to the same
extent and with the same effect as the provisions contained in Section 6 of
the
Underwriting Agreement pursuant to which the underwriters have agreed to
indemnify the Company.
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(ii) Exercise
of Warrants.
Nothing
contained in this Warrant shall be construed as requiring the Holder(s) to
exercise their Warrants prior to or after the initial filing of any registration
statement or the effectiveness thereof.
(iii) Documents
Delivered to Holders.
The
Company shall furnish to each Holder participating in any of the foregoing
offerings and to each underwriter of any such offering, if any, a signed
counterpart, addressed to such Holder or underwriter, of (a) an opinion of
counsel to the Company, dated the effective date of such registration statement
(and, if such registration includes an underwritten public offering, an opinion
dated the date of the closing under any underwriting agreement related thereto),
and (b) a “cold comfort” letter dated the effective date of such registration
statement (and, if such registration includes an underwritten public offering,
a
letter dated the date of the closing under the underwriting agreement) signed
by
the independent public accountants who have issued a report on the Company's
financial statements included in such registration statement, in each case
covering substantially the same matters with respect to such registration
statement (and the prospectus included therein) and, in the case of such
accountants' letter, with respect to events subsequent to the date of such
financial statements, as are customarily covered in opinions of issuer's counsel
and in accountants' letters delivered to underwriters in underwritten public
offerings of securities. The Company shall also deliver promptly to each Holder
participating in the offering requesting the correspondence and memoranda
described below and to the managing underwriter copies of all correspondence
between the Commission and the Company, its counsel or auditors and all
memoranda relating to discussions with the Commission or its staff with respect
to the registration statement and permit each Holder and underwriter to do
such
investigation, upon reasonable advance notice, with respect to information
contained in or omitted from the registration statement as it deems reasonably
necessary to comply with applicable securities laws or rules of FINRA. Such
investigation shall include access to books, records and properties and
opportunities to discuss the business of the Company with its officers and
independent auditors, all to such reasonable extent and at such reasonable
times
as any such Holder shall reasonably request.
7
(iv) Underwriting
Agreement.
The
Company shall enter into an underwriting agreement with the managing
underwriter(s) selected by any Holders whose Registrable Securities are being
registered pursuant to this Section 8, which managing underwriter shall be
reasonably satisfactory to the Company. Such agreement shall be reasonably
satisfactory in form and substance to the Company, each Holder and such managing
underwriters, and shall contain such representations, warranties and covenants
by the Company and such other terms as are customarily contained in agreements
of that type used by the managing underwriter. The Holders shall be parties
to
any underwriting agreement relating to an underwritten sale of their Registrable
Securities and may, at their option, require that any or all the
representations, warranties and covenants of the Company to or for the benefit
of such underwriters shall also be made to and for the benefit of such Holders.
Such Holders shall not be required to make any representations or warranties
to
or agreements with the Company or the underwriters except as they may relate
to
such Holders, their shares and their intended methods of
distribution.
(v) Documents
to Be Delivered by ▇▇▇▇▇▇(s).
Each of
the Holder(s) participating in any of the foregoing offerings shall furnish
to
the Company a completed and executed questionnaire provided by the Company
requesting information customarily sought of selling
securityholders.
9. No
Rights as Shareholder until Exercise.
This
Warrant does not entitle the Holder to any voting rights or other rights as
a
shareholder of the Company prior to the exercise hereof. Upon the surrender
of
this Warrant and the payment of the aggregate Exercise Price (or by means of
a
cashless exercise), the Warrant Shares so purchased shall be and be deemed
to be
issued to such Holder as the record owner of such shares as of the close of
business on the later of the date of such surrender or payment.
10. Loss,
Theft, Destruction or Mutilation of Warrant.
The
Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant
or any stock certificate relating to the Warrant Shares, and in case of loss,
theft or destruction, of indemnity or security reasonably satisfactory to it
(which, in the case of the Warrant, shall not include the posting of any bond),
and upon surrender and cancellation of such Warrant or stock certificate, if
mutilated, the Company will make and deliver a new Warrant or stock certificate
of like tenor and dated as of such cancellation, in lieu of such Warrant or
stock certificate.
11. Saturdays,
Sundays, Holidays, etc.
If the
last or appointed day for the taking of any action or the expiration of any
right required or granted herein shall be a Saturday, Sunday or a legal holiday,
then such action may be taken or such right may be exercised on the next
succeeding day not a Saturday, Sunday or legal holiday.
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12. Adjustments
of Exercise Price and Number of Warrant Shares; Stock Splits,
etc.
The
number and kind of securities purchasable upon the exercise of this Warrant
and
the Exercise Price shall be subject to adjustment from time to time upon the
happening of any of the following. In case the Company shall (i) pay a dividend
in shares of Common Stock or make a distribution in shares of Common Stock
to
holders of its outstanding Common Stock, (ii) subdivide its outstanding shares
of Common Stock into a greater number of shares, (iii) combine its outstanding
shares of Common Stock into a smaller number of shares of Common Stock, or
(iv)
issue any shares of its capital stock in a reclassification of the Common Stock,
then the number of Warrant Shares purchasable upon exercise of this Warrant
immediately prior thereto shall be adjusted so that the Holder shall be entitled
to receive the kind and number of Warrant Shares or other securities of the
Company which it would have owned or have been entitled to receive had such
Warrant been exercised in advance thereof. Upon
each
such adjustment of the kind and number of Warrant Shares or other securities
of
the Company which are purchasable hereunder, the Holder shall thereafter be
entitled to purchase the number of Warrant Shares or other securities resulting
from such adjustment at an Exercise Price per Warrant Share or other security
obtained by multiplying the Exercise Price in effect immediately prior to such
adjustment by the number of Warrant Shares purchasable pursuant hereto
immediately prior to such adjustment and dividing by the number of Warrant
Shares or other securities of the Company resulting from such adjustment.
An
adjustment made pursuant to this paragraph shall become effective immediately
after the effective date of such event retroactive to the record date, if any,
for such event.
13. Reorganization,
Reclassification, Merger, Consolidation or Disposition of Assets.
In case
the Company shall reorganize its capital, reclassify its capital stock,
consolidate or merge with or into another corporation (where the Company is
not
the surviving corporation or where there is a change in or distribution with
respect to the Common Stock of the Company), or sell, transfer or otherwise
dispose of all or substantially all its property, assets or business to another
corporation and, pursuant to the terms of such reorganization, reclassification,
merger, consolidation or disposition of assets, shares of common stock of the
successor or acquiring corporation, or any cash, shares of stock or other
securities or property of any nature whatsoever (including warrants or other
subscription or purchase rights) in addition to or in lieu of common stock
of
the successor or acquiring corporation (“Other
Property”),
are
to be received by or distributed to the holders of Common Stock of the Company,
then the Holder shall have the right thereafter to receive, upon exercise of
this Warrant, instead of the shares of Common Stock, the number of shares of
common stock and/or Other Property receivable upon or as a result of such
reorganization, reclassification, merger, consolidation or disposition of assets
by a Holder of the number of shares of Common Stock for which this Warrant
is
exercisable immediately prior to such event. In case of any such reorganization,
reclassification, merger, consolidation or disposition of assets, the successor
or acquiring corporation (if other than the Company) shall expressly assume
the
due and punctual observance and performance of each and every covenant and
condition of this Warrant to be performed and observed by the Company and all
the obligations and liabilities hereunder, subject to such modifications as
may
be deemed appropriate (as determined in good faith by resolution of the Board
of
Directors of the Company) in order to provide for adjustments of Warrant Shares
for which this Warrant is exercisable which shall be as nearly equivalent as
practicable to the adjustments provided for in this Section 12. For purposes
of
this Section 12, “common stock” shall include stock of such corporation of any
class which is not preferred as to dividends or assets over any other class
of
stock of such corporation and which is not subject to redemption and shall
also
include any evidences of indebtedness, shares of stock or other securities
which
are convertible into or exchangeable for any such stock, either immediately
or
upon the arrival of a specified date or the happening of a specified event
and
any warrants or other rights to subscribe for or purchase any such stock. The
foregoing provisions of this Section 12 shall similarly apply to successive
reorganizations, reclassifications, mergers, consolidations or disposition
of
assets.
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14. Voluntary
Adjustment by the Company.
The
Company may at any time during the term of this Warrant reduce the then current
Exercise Price to any amount and for any period of time deemed appropriate
by
the Board of Directors of the Company.
15. Notice
of Adjustment.
Whenever the number of Warrant Shares or number or kind of securities or other
property purchasable upon the exercise of this Warrant or the Exercise Price
is
adjusted, as herein provided, the Company shall give notice thereof to the
Holder, which notice shall state the number of Warrant Shares (and other
securities or property) purchasable upon the exercise of this Warrant and the
Exercise Price of such Warrant Shares (and other securities or property) after
such adjustment, setting forth a brief statement of the facts requiring such
adjustment and setting forth the computation by which such adjustment was
made.
16. Notice
of Corporate Action.
If at
any time:
(a) the
Company shall take a record of the holders of its Common Stock for the purpose
of entitling them to receive an extraordinary dividend or other distribution,
or
any right to subscribe for or purchase any evidences of its indebtedness, any
shares of stock of any class or any other securities or property, or to receive
any other right, or
(b) there
shall be any capital reorganization of the Common Stock, any reclassification
or
recapitalization of the capital stock of the Company or any consolidation or
merger of the Company with, or any sale, transfer or other disposition of all
or
substantially all the property, assets or business of the Company to, another
corporation, or
(c) there
shall be a voluntary or involuntary dissolution, liquidation or winding up
of
the Company, or
(d) no
registration statement registering the sale of the Warrant Shares to the Holder
upon exercise of this Warrant is then effective or such registration statement
is not then available for use, as reasonably determined by the Company;
then,
in
any one or more of such cases, the Company shall give to Holder (i) at least
10
days’ prior written notice of the date on which a record date shall be selected
for such dividend, distribution or right or for determining rights to vote
in
respect of any such reorganization, reclassification, merger, consolidation,
sale, transfer, disposition, liquidation or winding up, and (ii) in the case
of
any such reorganization, reclassification, merger, consolidation, sale,
transfer, disposition, dissolution, liquidation or winding up, at least 10
days’
prior written notice of the date when the same shall take place, and (iii)
in
the case of the absence of any effective registration statement registering
the
sale of the Warrant Shares to the Holder upon exercise of this Warrant or
unavailability thereof, promptly upon knowledge by the Company of such
occurrence. Such notice in accordance with the foregoing clauses (a)-(c) also
shall specify (i) the date on which any such record is to be taken for the
purpose of such dividend, distribution or right, the date on which the holders
of Common Stock shall be entitled to any such dividend, distribution or right,
and the amount and character thereof, and (ii) the date on which any such
reorganization, reclassification, merger, consolidation, sale, transfer,
disposition, dissolution, liquidation or winding up is to take place and the
time, if any such time is to be fixed, as of which the holders of Common Stock
shall be entitled to exchange their Warrant Shares for securities or other
property deliverable upon such disposition, dissolution, liquidation or winding
up. Such notice in accordance with clause (d) shall also specify the Company’s
good faith believe as to when a registration statement registering such sale
shall be filed or amended or available for use again. Each such written notice
shall be sufficiently given if addressed to Holder at the last address of Holder
appearing on the books of the Company and delivered in accordance with Section
18(e).
10
17. Authorized
Shares.
The
Company covenants that during the period the Warrant is outstanding, it will
reserve from its authorized and unissued Common Stock a sufficient number of
shares to provide for the issuance of the Warrant Shares upon the exercise
of
any purchase rights under this Warrant. The Company further covenants that
its
issuance of this Warrant shall constitute full authority to its officers who
are
charged with the duty of executing stock certificates to execute and issue
the
necessary certificates for the Warrant Shares upon the exercise of the purchase
rights under this Warrant. The Company will take all such reasonable action
as
may be necessary to assure that such Warrant Shares may be issued as provided
herein without violation of any applicable law or regulation, or of any
requirements of the principal market or exchange upon which the Common Stock
may
be listed.
Except
and to the extent as waived or consented to by the Holder, the Company shall
not
by any action, including, without limitation, amending its certificate of
incorporation or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities or any other voluntary action,
avoid or seek to avoid the observance or performance of any of the terms of
this
Warrant, but will at all times in good faith assist in the carrying out of
all
such terms and in the taking of all such actions as may be necessary or
appropriate to protect the rights of Holder as set forth in this Warrant against
impairment. Without limiting the generality of the foregoing, the Company will
(a) not increase the par value of any Warrant Shares above the amount payable
therefor upon such exercise immediately prior to such increase in par value,
(b)
take all such action as may be necessary or appropriate in order that the
Company may validly and legally issue fully paid and nonassessable Warrant
Shares upon the exercise of this Warrant, and (c) use commercially reasonable
efforts to obtain all such authorizations, exemptions or consents from any
public regulatory body having jurisdiction thereof as may be necessary to enable
the Company to perform its obligations under this Warrant.
Before
taking any action which would result in an adjustment in the number of Warrant
Shares for which this Warrant is exercisable or in the Exercise Price, the
Company shall obtain all such authorizations or exemptions thereof, or consents
thereto, as may be necessary from any public regulatory body or bodies having
jurisdiction thereof.
11
18. Miscellaneous.
(a) Jurisdiction.
This
Warrant shall constitute a contract under the laws of New York, without regard
to its conflict of law, principles or rules. The Company hereby agrees that
any
action, proceeding or claim against it arising out of, or relating in any way
to
this Warrant shall be brought and enforced in the courts of the State of New
York or of the United States of America for the Southern District of New York,
and irrevocably submits to such jurisdiction, which jurisdiction shall be
exclusive. The Company hereby waives any objection to such exclusive
jurisdiction and that such courts represent an inconvenient forum. Any process
or summons to be served upon the Company may be served by transmitting a copy
thereof by registered or certified mail, return receipt requested, postage
prepaid, addressed to DLA Piper US LLP, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇ ▇▇▇▇. Such mailing shall be deemed personal
service and shall be legal and binding upon the Company in any action,
proceeding or claim. The Company and the Holder, by acceptance hereof, agree
that the prevailing party(ies) in any such action shall be entitled to recover
from the other party(ies) all of its reasonable attorneys' fees and expenses
relating to such action or proceeding and/or incurred in connection with the
preparation therefor.
(b) Restrictions.
The
Holder acknowledges that the Warrant Shares acquired upon the exercise of this
Warrant, if not registered, will have restrictions upon resale imposed by state
and federal securities laws.
(c) Nonwaiver
and Expenses.
No
course of dealing or any delay or failure to exercise any right hereunder on
the
part of Holder shall operate as a waiver of such right or otherwise prejudice
Holder’s rights, powers or remedies, notwithstanding all rights hereunder
terminate on the Termination Date. If the Company willfully and knowingly fails
to comply with any provision of this Warrant, which results in any material
damages to the Holder, the Company shall pay to Holder such amounts as shall
be
sufficient to cover any costs and expenses including, but not limited to,
reasonable attorneys’ fees, including those of appellate proceedings, incurred
by Holder in collecting any amounts due pursuant hereto or in otherwise
enforcing any of its rights, powers or remedies hereunder.
(d) FINRA
Rules.
Notwithstanding anything contained in this Warrant, the terms of this Warrant
are intended to comply with the rules and regulations of the Financial Industry
Regulatory Authority, Inc. relating to the compensation of underwriters and
placement agents, and any provision of this Warrant that is determined to be
inconsistent with such rules shall be deemed to be modified to the extent
necessary to comply with such rules.
(e) Notices.
All
notices, requests, consents and other communications under this Warrant shall
be
in writing and shall be deemed to have been duly made on the date of delivery
if
delivered personally or sent by overnight courier, with acknowledgement of
receipt to the party to which notice is given, or on the fifth day after mailing
if mailed to the party to whom notice is to be given, by registered or certified
mail, return receipt requested, postage prepaid and properly addressed as
follows: (i) if to the registered Holder of the Warrant, to the address of
such
Holder as shown on the books of the Company, or (ii) if to the Company, to
its
principal executive office. Upon any permitted assignment of this Warrant,
the
assignee shall promptly provide the Company with its contact
information.
12
(f) Limitation
of Liability.
No
provision hereof, in the absence of any affirmative action by Holder to exercise
this Warrant or purchase Warrant Shares, and no enumeration herein of the rights
or privileges of Holder, shall give rise to any liability of Holder for the
purchase price of any Common Stock or as a stockholder of the Company, whether
such liability is asserted by the Company or by creditors of the
Company.
(g) Remedies.
Holder,
in addition to being entitled to exercise all rights granted by law, including
recovery of damages, will be entitled to specific performance of its rights
under this Warrant. The Company agrees that monetary damages would not be
adequate compensation for any loss incurred by reason of a breach by it of
the
provisions of this Warrant and hereby agrees to waive the defense in any action
for specific performance that a remedy at law would be adequate.
(h) Successors
and Assigns.
Subject
to applicable securities laws, this Warrant and the rights and obligations
evidenced hereby shall inure to the benefit of and be binding upon the
successors of the Company and the successors and permitted assigns of Holder.
The provisions of this Warrant are intended to be for the benefit of all Holders
from time to time of this Warrant and shall be enforceable by any such Holder
or
holder of Warrant Shares.
(i) Amendment.
This
Warrant may be modified or amended or the provisions hereof waived with the
written consent of the Company and the Holder; provided,
however,
if this
Warrant is subsequently transferred to other Persons, this Warrant may be
modified or amended or the provisions hereof waived with the written consent
of
such transferees (and the original Holder if such Holder holds any part of
the
Warrant at such time) holding Warrant(s) exercisable into a majority of the
Warrant Shares then issuable under the Warrants derived from the initial
Warrant. Notwithstanding anything to the contrary in this paragraph, the Company
and the Underwriters may from time to time supplement or amend this Warant
without the approval of any of the Holders in order to cure any ambiguity,
to
correct or supplement any provision contained herein which may be defective
or
inconsistent with any other provisions herein, or to make any other provisions
in regard to matters or questions arising hereunder which the Company and the
Underwriters may deem necessary or desirable and which the Company and the
Underwriters deem shall not adversely affect the interest of the
Holders.
(j) Severability.
Wherever possible, each provision of this Warrant shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Warrant shall be prohibited by or invalid under applicable law, such
provision shall be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provisions or the remaining
provisions of this Warrant.
13
(k) Headings.
The
headings used in this Warrant are for the convenience of reference only and
shall not, for any purpose, be deemed a part of this Warrant.
********************
14
IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed by its
officer thereunto duly authorized.
Dated:
______ __, 2008
| HUIHENG MEDICAL, INC. | ||
| |
|
|
| By: | ||
|
Name:
▇▇▇ ▇▇▇▇▇▇▇▇
Title:
Chief Executive Officer
|
||
15
NOTICE
OF EXERCISE
(1) The
undersigned hereby elects to purchase ________ Warrant Shares of Huiheng
Medical, Inc. pursuant to the terms of the attached Warrant (only if exercised
in full), and tenders herewith payment of the exercise price in full, together
with all applicable transfer taxes, if any.
(2) Please
issue a certificate or certificates representing said Warrant Shares in the
name
of the undersigned or in such other name as is specified below:
The
Warrant Shares shall be delivered to the following DTC account:
| [Holder] | ||
| |
|
|
| By: | ||
|
Name:
Title:
|
||
| Dated: |
|
16
ASSIGNMENT
FORM
(To
assign the foregoing warrant, execute
this
form
and supply required information.
Do
not
use this form to exercise the warrant.)
FOR
VALUE
RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby
assigned to
_______________________________________________
whose address is
_______________________________________________________________.
_______________________________________________________________
Dated:
______________, _______
Holder's
Signature: _____________________________
Holder's
Address: _____________________________
_____________________________
Signature
Guaranteed: ___________________________________________
NOTE:
The
signature to this Assignment Form must correspond with the name as it appears
on
the face of the Warrant, without alteration or enlargement or any change
whatsoever, and must be guaranteed by a bank or trust company. Officers of
corporations and those acting in a fiduciary or other representative capacity
should file proper evidence of authority to assign the foregoing
Warrant.
17