Exhibit 4.5
THE REGISTERED HOLDER OF THIS PURCHASE OPTION BY ITS ACCEPTANCE HEREOF, AGREES
THAT IT WILL NOT SELL, TRANSFER OR ASSIGN THIS PURCHASE OPTION EXCEPT AS HEREIN
PROVIDED AND THE REGISTERED HOLDER OF THIS PURCHASE OPTION AGREES THAT IT WILL
NOT SELL, TRANSFER, ASSIGN, PLEDGE OR HYPOTHECATE THIS PURCHASE OPTION FOR A
PERIOD OF ONE YEAR FOLLOWING THE EFFECTIVE DATE (DEFINED BELOW) TO ANYONE OTHER
THAN (I) ▇▇▇▇▇▇ ▇▇▇▇▇▇ & CO. INC. ("▇▇▇▇▇▇ ▇▇▇▇▇▇"), OR AN UNDERWRITER OR A
SELECTED DEALER IN CONNECTION WITH THE OFFERING, OR (II) A BONA FIDE OFFICER OR
PARTNER OF ▇▇▇▇▇▇ ▇▇▇▇▇▇ OR OF ANY SUCH UNDERWRITER OR SELECTED DEALER.
THIS PURCHASE OPTION IS NOT EXERCISABLE PRIOR TO THE LATER OF THE CONSUMMATION
BY INTER-ATLANTIC FINANCIAL, INC. ("COMPANY") OF A MERGER, CAPITAL STOCK
EXCHANGE, ASSET ACQUISITION OR OTHER SIMILAR BUSINESS COMBINATION ("BUSINESS
COMBINATION")(AS DESCRIBED MORE FULLY IN THE COMPANY'S REGISTRATION STATEMENT
(DEFINED HEREIN)) OR __ __, 2008. VOID AFTER 5:00 P.M. NEW YORK CITY LOCAL
TIME, __ __, 2012.
UNIT PURCHASE OPTION
FOR THE PURCHASE OF
525,000 UNITS
OF
INTER-ATLANTIC FINANCIAL, INC.
1. PURCHASE OPTION.
THIS CERTIFIES THAT, in consideration of $100.00 duly paid by or on behalf
of ▇▇▇▇▇▇ ▇▇▇▇▇▇ or its designee ("HOLDER"), as registered owner of this
Purchase Option, to Inter-Atlantic Financial, Inc. ("COMPANY"), Holder is
entitled, at any time or from time to time upon the later of the consummation of
a Business Combination or __ __, 2008 ("COMMENCEMENT DATE"), and at or
before 5:00 p.m., New York City local time, __ __, 2012 ("EXPIRATION
DATE"), but not thereafter, to subscribe for, purchase and receive, in whole or
in part, up to 525,000 units ("UNITS") of the Company, each Unit consisting of
one share of common stock of the Company, par value $0.0001 per share
("SHARES"), and one warrant ("WARRANT(S)") expiring four years from the
effective date ("EFFECTIVE DATE") of the registration statement ("REGISTRATION
STATEMENT") pursuant to which Units are offered for sale to the public
("OFFERING"). Each Warrant is the same as the warrants included in the Units
being registered for sale to the public by way of the Registration Statement
("PUBLIC WARRANTS"). If the Expiration Date is a day on which banking
institutions are authorized by law to close, then this Purchase Option may be
exercised on the next succeeding day which is not such a day in accordance with
the terms herein. During the period ending on the Expiration Date, the Company
agrees not to take any action that would terminate the Purchase Option. This
Purchase Option is initially exercisable at $10.00 per Unit so purchased;
provided, however, that upon the occurrence of any
of the events specified in Section 6 hereof, the rights granted by this Purchase
Option, including the exercise price per Unit and the number of Units (and
Shares and Warrants) to be received upon such exercise, shall be adjusted as
therein specified. The term "Exercise Price" shall mean the initial exercise
price or the adjusted exercise price, depending on the context.
2. EXERCISE.
2.1 Exercise Form. In order to exercise this Purchase Option, the exercise
form attached hereto must be duly executed and completed and delivered to the
Company, together with this Purchase Option and payment of the Exercise Price
for the Units being purchased payable in cash or by certified check or official
bank check. If the subscription rights represented hereby shall not be exercised
at or before 5:00 p.m., New York City local time, on the Expiration Date this
Purchase Option shall become and be void without further force or effect, and
all rights represented hereby shall cease and expire.
2.2 Legend. Each certificate for the securities purchased under this
Purchase Option shall bear a legend as follows unless such securities have been
registered under the Securities Act of 1933, as amended ("ACT"):
"The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended ("Act") or
applicable state law. The securities may not be offered for sale, sold
or otherwise transferred except pursuant to an effective registration
statement under the Act, or pursuant to an exemption from registration
under the Act and applicable state law."
2.3 Cashless Exercise.
2.3.1 Determination of Amount. In lieu of the payment of the Exercise
Price multiplied by the number of Units for which this Purchase Option is
exercisable (and in lieu of being entitled to receive Shares and Warrants) in
the manner required by Section 2.1, the Holder shall have the right (but not the
obligation) to convert any exercisable but unexercised portion of this Purchase
Option into Units (the "CONVERSION RIGHT") as follows: upon exercise of the
Conversion Right, the Company shall deliver to the Holder (without payment by
the Holder of any of the Exercise Price in cash) that number of Shares and
Warrants comprising that number of Units equal to the quotient obtained by
dividing (x) the "Value" (as defined below) of the portion of the Purchase
Option being converted by (y) the Current Market Value (as defined below) of the
portion of the Purchase Option being converted. The "VALUE" of the portion of
the Purchase Option being converted shall equal the remainder derived from
subtracting (a) (i) the Exercise Price multiplied by (ii) the number of Units
underlying the portion of this Purchase Option being converted from (b) the
Current Market Value of a Unit multiplied by the number of Units underlying the
portion of the Purchase Option being converted. As used herein, the term
"CURRENT MARKET VALUE" per Unit at any date means: (A) in the event that neither
the Units nor Warrants are still trading, the remainder derived from subtracting
(x) the exercise price of the Warrants multiplied by the number of Shares
issuable upon exercise of the Warrants underlying one Unit from (y) (i) the
Current Market Price of the Shares multiplied by (ii) the number of Shares
underlying one Unit, which shall include the Shares underlying the Warrants
included in such Unit; (B) in the event that the Units, Shares and Warrants are
still trading, (i) if the Units
are listed on a national securities exchange or quoted on the Nasdaq National
Market, Nasdaq SmallCap Market or NASD OTC Bulletin Board (or successor such as
the Bulletin Board Exchange), the last sale price of the Units in the principal
trading market for the Units as reported by the exchange, Nasdaq or the NASD, as
the case may be, on the last trading day preceding the date in question; or (ii)
if the Units are not listed on a national securities exchange or quoted on the
Nasdaq National Market, Nasdaq SmallCap Market or the NASD OTC Bulletin Board
(or successor exchange), but are traded in the residual over-the-counter market,
the closing bid price for Units on the last trading day preceding the date in
question for which such quotations are reported by the Pink Sheets, LLC or
similar publisher of such quotations; and (C) in the event that the Units are
not still trading but the Shares and Warrants underlying the Units are still
trading, the Current Market Price of the Shares plus the product of (x) the
Current Market Price of the Warrants and (y) the number of Shares underlying the
Warrants included in one Unit. The "CURRENT MARKET PRICE" shall mean (i) if the
Shares (or Warrants, as the case may be) are listed on a national securities
exchange or quoted on the Nasdaq National Market, Nasdaq SmallCap Market or NASD
OTC Bulletin Board (or successor such as the Bulletin Board Exchange), the last
sale price of the Shares (or Warrants) in the principal trading market for the
Shares as reported by the exchange, Nasdaq or the NASD, as the case may be, on
the last trading day preceding the date in question; (ii) if the Shares (or
Warrants, as the case may be) are not listed on a national securities exchange
or quoted on the Nasdaq National Market, Nasdaq SmallCap Market or the NASD OTC
Bulletin Board (or successor exchange), but are traded in the residual
over-the-counter market, the closing bid price for the Shares (or Warrants) on
the last trading day preceding the date in question for which such quotations
are reported by the Pink Sheets, LLC or similar publisher of such quotations;
and (iii) if the fair market value of the Shares cannot be determined pursuant
to clause (i) or (ii) above, such price as the Board of Directors of the Company
shall determine, in good faith.
2.3.2 Mechanics of Cashless Exercise. The Cashless Exercise Right may
be exercised by the Holder on any business day on or after the Commencement Date
and not later than the Expiration Date by delivering the Purchase Option with
the duly executed exercise form attached hereto with the cashless exercise
section completed to the Company, exercising the Cashless Exercise Right and
specifying the total number of Units the Holder will purchase pursuant to such
Cashless Exercise Right.
3. TRANSFER.
3.1 General Restrictions. The registered Holder of this Purchase Option, by
its acceptance hereof, agrees that it will not sell, transfer, assign, pledge or
hypothecate this Purchase Option for a period of one year following the
Effective Date to anyone other than (i) ▇▇▇▇▇▇ ▇▇▇▇▇▇ or an underwriter or a
selected dealer in connection with the Offering, or (ii) a bona fide officer or
partner of ▇▇▇▇▇▇ ▇▇▇▇▇▇ or of any such underwriter or selected dealer. On and
after the first anniversary of the Effective Date, transfers to others may be
made subject to compliance with or exemptions from applicable securities laws.
In order to make any permitted assignment, the Holder must deliver to the
Company the assignment form attached hereto duly executed and completed,
together with the Purchase Option and payment of all transfer taxes, if any,
payable in connection therewith. The Company shall within five business days
transfer this Purchase Option on the books of the Company and shall execute and
deliver a new Purchase Option or Purchase Options of like tenor to the
appropriate assignee(s) expressly evidencing the
right to purchase the aggregate number of Units purchasable hereunder or such
portion of such number as shall be contemplated by any such assignment.
3.2 Restrictions Imposed by the Act. The securities evidenced by this
Purchase Option shall not be transferred unless and until (i) the Company has
received the opinion of counsel for the Holder that the securities may be
transferred pursuant to an exemption from registration under the Act and
applicable state securities laws, the availability of which is established to
the reasonable satisfaction of the Company (the Company hereby agreeing that the
opinion of DLA Piper US LLP shall be deemed satisfactory evidence of the
availability of an exemption), or (ii) a registration statement or a
post-effective amendment to the Registration Statement relating to such
securities has been filed by the Company and declared effective by the
Securities and Exchange Commission (the "COMMISSION") and compliance with
applicable state securities law has been established.
4. NEW PURCHASE OPTIONS TO BE ISSUED.
4.1 Partial Exercise or Transfer. Subject to the restrictions in Section 3
hereof, this Purchase Option may be exercised or assigned in whole or in part.
In the event of the exercise or assignment hereof in part only, upon surrender
of this Purchase Option for cancellation, together with the duly executed
exercise or assignment form and except in the case of an exercise of this
Purchase Option contemplated by Section 2.3 hereof, funds sufficient to pay any
Exercise Price and/or transfer tax, the Company shall cause to be delivered to
the Holder without charge a new Purchase Option of like tenor to this Purchase
Option in the name of the Holder evidencing the right of the Holder to purchase
the number of Units purchasable hereunder as to which this Purchase Option has
not been exercised or assigned.
4.2 Lost Certificate. Upon receipt by the Company of evidence satisfactory
to it of the loss, theft, destruction or mutilation of this Purchase Option and
of reasonably satisfactory indemnification or the posting of a bond, the Company
shall execute and deliver a new Purchase Option of like tenor and date. Any such
new Purchase Option executed and delivered as a result of such loss, theft,
mutilation or destruction shall constitute a substitute contractual obligation
on the part of the Company.
5. REGISTRATION RIGHTS.
5.1 Demand Registration.
5.1.1 Grant of Right. The Company, upon written demand ("INITIAL
DEMAND NOTICE") of the Holder(s) of at least 51% of the Purchase Options and/or
the underlying Units and/or the underlying securities ("MAJORITY HOLDERS"),
agrees to register (the "DEMAND REGISTRATION") under the Act on one occasion,
all or any portion of the Purchase Options requested by the Majority Holders in
the Initial Demand Notice and all of the securities underlying such Purchase
Options, including the Units, Shares, the Warrants and the Shares underlying the
Warrants (collectively, the "REGISTRABLE SECURITIES"). On such occasion, the
Company will file a registration statement or a post-effective amendment to the
Registration Statement covering the Registrable Securities within sixty days
after receipt of the Initial Demand Notice and use its best efforts to have such
registration statement or post-effective
amendment declared effective as soon as possible thereafter. The demand for
registration may be made at any time during a period of five years beginning on
the Effective Date. The Initial Demand Notice shall specify the number of shares
of Registrable Securities proposed to be sold and the intended method(s) of
distribution thereof. The Company will notify all holders of the Purchase
Options and/or Registrable Securities of the demand within ten days from the
date of the receipt of any such Initial Demand Notice. Each holder of
Registrable Securities who wishes to include all or a portion of such holder's
Registrable Securities in the Demand Registration (each such holder including
shares of Registrable Securities in such registration, a "DEMANDING HOLDER")
shall so notify the Company within fifteen (15) days after the receipt by the
holder of the notice from the Company. Upon any such request, the Demanding
Holders shall be entitled to have their Registrable Securities included in the
Demand Registration, subject to Section 5.1.4.
5.1.2 Effective Registration. A registration will not count as a
Demand Registration until the registration statement filed with the Commission
with respect to such Demand Registration has been declared effective and the
Company has complied with all of its obligations under this Agreement with
respect thereto; provided, however, that if, after such registration statement
has been declared effective, the offering of Registrable Securities pursuant to
a Demand Registration is interfered with by any stop order or injunction of the
Commission or any other governmental agency or court, the registration statement
with respect to such Demand Registration will be deemed not to have been
declared effective, unless and until, (i) such stop order or injunction is
removed, rescinded or otherwise terminated, and (ii) a majority-in-interest of
the Demanding Holders thereafter elect to continue the offering.
5.1.3 Underwritten Offering. If the Majority Holders so elect and such
holders so advise the Company as part of the Initial Demand Notice, the offering
of such Registrable Securities pursuant to such Demand Registration shall be in
the form of an underwritten offering. In such event, the right of any holder to
include its Registrable Securities in such registration shall be conditioned
upon such holder's participation in such underwriting and the inclusion of such
holder's Registrable Securities in the underwriting to the extent provided
herein. All Demanding Holders proposing to distribute their securities through
such underwriting shall enter into an underwriting agreement in customary form
with the underwriter or underwriters selected for such underwriting by the
Majority Holders.
5.1.4 Reduction of Offering. If the managing underwriter or
underwriters for a Demand Registration that is to be an underwritten offering
advises the Company and the Demanding Holders in writing that the dollar amount
or number of shares of Registrable Securities which the Demanding Holders desire
to sell, taken together with all other Shares or other securities which the
Company desires to sell and the Shares, if any, as to which registration has
been requested pursuant to written contractual piggy-back registration rights
held by other stockholders of the Company who desire to sell, exceeds the
maximum dollar amount or maximum number of shares that can be sold in such
offering without adversely affecting the proposed offering price, the timing,
the distribution method, or the probability of success of such offering (such
maximum dollar amount or maximum number of shares, as applicable, the "MAXIMUM
NUMBER OF SHARES"), then the Company shall include in such registration: (i)
first, the Registrable Securities as to which Demand Registration has been
requested by the Demanding Holders (pro rata in accordance with the number of
shares that each such Person has
requested be included in such registration, regardless of the number of shares
held by each such Person (such proportion is referred to herein as "PRO RATA"))
that can be sold without exceeding the Maximum Number of Shares; (ii) second, to
the extent that the Maximum Number of Shares has not been reached under the
foregoing clause (i), the Shares or other securities that the Company desires to
sell that can be sold without exceeding the Maximum Number of Shares; (iii)
third, to the extent that the Maximum Number of Shares has not been reached
under the foregoing clauses (i) and (ii), the Shares or other securities
registrable pursuant to the terms of the Registration Rights Agreement between
the Company and the initial investors in the Company, dated as of January __,
2007 (the "REGISTRATION RIGHTS AGREEMENT" and such registrable securities, the
"INVESTOR SECURITIES") as to which "piggy-back" registration has been requested
by the holders thereof, Pro Rata, that can be sold without exceeding the Maximum
Number of Shares; and (iv) fourth, to the extent that the Maximum Number of
Shares have not been reached under the foregoing clauses (i), (ii), and (iii),
the Shares or other securities for the account of other persons that the Company
is obligated to register pursuant to written contractual arrangements with such
persons and that can be sold without exceeding the Maximum Number of Shares.
5.1.5 Withdrawal. If a majority-in-interest of the Demanding Holders
disapprove of the terms of any underwriting or are not entitled to include all
of their Registrable Securities in any offering, such majority-in-interest of
the Demanding Holders may elect to withdraw from such offering by giving written
notice to the Company and the underwriter or underwriters of their request to
withdraw prior to the effectiveness of the registration statement filed with the
Commission with respect to such Demand Registration. If the majority-in-interest
of the Demanding Holders withdraws from a proposed offering relating to a Demand
Registration, then such registration shall not count as a Demand Registration
provided for in Section 5.1.
5.1.6 Terms. The Company shall bear all fees and expenses attendant to
registering the Registrable Securities, including the expenses of any legal
counsel selected by the Holders to represent them in connection with the sale of
the Registrable Securities, but the Holders shall pay any and all underwriting
commissions. The Company agrees to use its reasonable best efforts to qualify or
register the Registrable Securities in such states as are reasonably requested
by the Majority Holder(s); provided, however, that in no event shall the Company
be required to register the Registrable Securities in a state in which such
registration would cause (i) the Company to be obligated to qualify to do
business in such state, or would subject the Company to taxation as a foreign
corporation doing business in such jurisdiction or (ii) 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 or
post-effective amendment filed pursuant to the demand rights granted under
Section 5.1.1 to remain effective for a period of nine consecutive months from
the effective date of such registration statement or post-effective amendment.
5.2 Piggy-Back Registration.
5.2.1 Piggy-Back Rights. If at any time during the seven year period
commencing on the Effective Date the Company proposes to file a registration
statement under the Act with respect to an offering of equity securities, or
securities or other obligations
exercisable or exchangeable for, or convertible into, equity securities, by the
Company for its own account or for stockholders of the Company for their account
(or by the Company and by stockholders of the Company including, without
limitation, pursuant to Section 5.1), other than a registration statement (i)
filed in connection with any employee stock option or other benefit plan, (ii)
for an exchange offer or offering of securities solely to the Company's existing
stockholders, (iii) for an offering of debt that is convertible into equity
securities of the Company or (iv) for a dividend reinvestment plan, then the
Company shall (x) give written notice of such proposed filing to the holders of
Registrable Securities as soon as practicable but in no event less than ten (10)
days before the anticipated filing date, which notice shall describe the amount
and type of securities to be included in such offering, the intended method(s)
of distribution, and the name of the proposed managing underwriter or
underwriters, if any, of the offering, and (y) offer to the holders of
Registrable Securities in such notice the opportunity to register the sale of
such number of shares of Registrable Securities as such holders may request in
writing within five (5) days following receipt of such notice (a "PIGGY-BACK
REGISTRATION"). The Company shall cause such Registrable Securities to be
included in such registration and shall use its best efforts to cause the
managing underwriter or underwriters of a proposed underwritten offering to
permit the Registrable Securities requested to be included in a Piggy-Back
Registration on the same terms and conditions as any similar securities of the
Company and to permit the sale or other disposition of such Registrable
Securities in accordance with the intended method(s) of distribution thereof.
All holders of Registrable Securities proposing to distribute their securities
through a Piggy-Back Registration that involves an underwriter or underwriters
shall enter into an underwriting agreement in customary form with the
underwriter or underwriters selected for such Piggy-Back Registration.
5.2.2 Reduction of Offering. If the managing underwriter or
underwriters for a Piggy-Back Registration that is to be an underwritten
offering advises the Company and the holders of Registrable Securities in
writing that the dollar amount or number of Shares which the Company desires to
sell, taken together with Shares, if any, as to which registration has been
demanded pursuant to written contractual arrangements with persons other than
the holders of Registrable Securities hereunder, the Registrable Securities as
to which registration has been requested under this Section 5.2, and the Shares,
if any, as to which registration has been requested pursuant to the written
contractual piggy-back registration rights of other stockholders of the Company,
exceeds the Maximum Number of Shares, then the Company shall include in any such
registration:
(a) If the registration is undertaken for the Company's account:
(A) first, the Shares or other securities that the Company desires to sell that
can be sold without exceeding the Maximum Number of Shares; (B) second, to the
extent that the Maximum Number of Shares has not been reached under the
foregoing clause (A), the Shares or other securities, if any, comprised of
Registrable Securities and Investor Securities, as to which registration has
been requested pursuant to the applicable written contractual piggy-back
registration rights of such security holders, Pro Rata, that can be sold without
exceeding the Maximum Number of Shares; and (C) third, to the extent that the
Maximum Number of Shares has not been reached under the foregoing clauses (A)
and (B), the Shares or other securities for the account of other persons that
the Company is obligated to register pursuant to written contractual piggy-back
registration rights with such persons and that can be sold without exceeding the
Maximum Number of Shares;
(b) If the registration is a "demand" registration undertaken at
the demand of holders of Investor Securities, (A) first, the Shares or other
securities for the account of the demanding persons, Pro Rata, that can be sold
without exceeding the Maximum Number of Shares; (B) second, to the extent that
the Maximum Number of Shares has not been reached under the foregoing clause
(A), the Shares or other securities that the Company desires to sell that can be
sold without exceeding the Maximum Number of Shares; (C) third, to the extent
that the Maximum Number of Shares has not been reached under the foregoing
clauses (A) and (B), the shares of Registrable Securities, Pro Rata, as to which
registration has been requested pursuant to the terms hereof, that can be sold
without exceeding the Maximum Number of Shares; and (D) fourth, to the extent
that the Maximum Number of Shares has not been reached under the foregoing
clauses (A), (B) and (C), the Shares or other securities for the account of
other persons that the Company is obligated to register pursuant to written
contractual arrangements with such persons, that can be sold without exceeding
the Maximum Number of Shares; and
(c) If the registration is a "demand" registration undertaken at
the demand of persons other than either the holders of Registrable Securities or
of Investor Securities, (A) first, the Shares or other securities for the
account of the demanding persons that can be sold without exceeding the Maximum
Number of Shares; (B) second, to the extent that the Maximum Number of Shares
has not been reached under the foregoing clause (A), the Shares or other
securities that the Company desires to sell that can be sold without exceeding
the Maximum Number of Shares; (C) third, to the extent that the Maximum Number
of Shares has not been reached under the foregoing clauses (A) and (B),
collectively the Shares or other securities comprised of Registrable Securities
and Investor Securities, Pro Rata, as to which registration has been requested
pursuant to the terms hereof and of the Registration Rights Agreement, as
applicable, that can be sold without exceeding the Maximum Number of Shares; and
(D) fourth, to the extent that the Maximum Number of Shares has not been reached
under the foregoing clauses (A), (B) and (C), the Shares or other securities for
the account of other persons that the Company is obligated to register pursuant
to written contractual arrangements with such persons, that can be sold without
exceeding the Maximum Number of Shares.
5.2.3 Withdrawal. Any holder of Registrable Securities may elect to
withdraw such ▇▇▇▇▇▇'s request for inclusion of Registrable Securities in any
Piggy-Back Registration by giving written notice to the Company of such request
to withdraw prior to the effectiveness of the registration statement. The
Company (whether on its own determination or as the result of a withdrawal by
persons making a demand pursuant to written contractual obligations) may
withdraw a registration statement at any time prior to the effectiveness of the
registration statement. Notwithstanding any such withdrawal, the Company shall
pay all expenses incurred by the holders of Registrable Securities in connection
with such Piggy-Back Registration as provided in Section 5.2.4.
5.2.4 Terms. The Company shall bear all fees and expenses attendant to
registering the Registrable Securities, including the expenses of any legal
counsel selected by the Holders to represent them in connection with the sale of
the Registrable Securities but the Holders shall pay any and all underwriting
commissions related to the Registrable Securities. In the event of such a
proposed registration, the Company shall furnish the then Holders of outstanding
Registrable Securities with not less than fifteen 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 applicable registration statement
filed (during the period in which the Purchase Option is exercisable) by the
Company until such time as all of the Registrable Securities have been
registered and sold. The Holders of the Registrable Securities shall exercise
the "piggy-back" rights provided for herein by giving written notice, within ten
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 nine
months from the date that the Holders of the Registrable Securities are first
given the opportunity to sell all of such securities.
5.3 No Net-Cash Settlement or Damages Upon Failure of Registration. In no
event shall the registered Holder of this Purchase Option be entitled to (i)
net-cash settlement of this Purchase Option, regardless of whether any or all of
the Registrable Securities have been registered by the Company pursuant to an
effective registration statement, or (ii) receive any damages if any or all of
the Registrable Securities have not been registered by the Company pursuant to
an effective registration statement, subject to the requirement that the Company
use its best efforts to have a registration statement or post-effective
amendment filed pursuant this Section 5 declared effective as soon as possible
after receiving the Initial Demand Notice. In the event there is no effective
registration statement related to the issuance or exercise of the Warrants
contained within the Units, that portion of the Units may be not exercisable by
the Holder and therefore may expire and be worthless.
5.4 General Terms.
5.4.1 Indemnification. The Company shall indemnify the Holder(s) of
the Registrable Securities to be sold pursuant to any registration statement
hereunder and each person, if any, who controls such Holders within the meaning
of Section 15 of the Act or Section 20(a) of the Securities Exchange Act of
1934, as amended ("EXCHANGE ACT"), against all loss, claim, damage, expense or
liability (including all reasonable attorneys' fees and other expenses
reasonably incurred in investigating, preparing or defending against litigation,
commenced or threatened, or any claim whatsoever whether arising out of any
action between the underwriter and the Company or between the underwriter and
any third party or otherwise) to which any of them may become subject under the
Act, the Exchange Act or otherwise, arising from such registration statement but
only to the same extent and with the same effect as the provisions pursuant to
which the Company has agreed to indemnify the underwriters contained in Section
5 of the Underwriting Agreement between the Company, ▇▇▇▇▇▇ ▇▇▇▇▇▇ and the other
underwriters named therein dated the Effective Date. The Holder(s) of the
Registrable Securities to be sold pursuant to such registration statement, and
their successors and assigns, shall severally, and not jointly, indemnify the
Company, its officers and directors and each person, if any, who controls the
Company within the meaning of Section 15 of the Act or Section 20(a) of the
Exchange Act, against all loss, claim, damage, expense or liability (including
all reasonable attorneys' fees and other expenses reasonably incurred in
investigating, preparing or defending against any claim whatsoever) to which
they may become subject under the Act, the Exchange Act or otherwise, arising
from information furnished by or on behalf of such Holders, or their successors
or assigns, in writing, for specific inclusion in such registration statement to
the same extent and with the same effect as the provisions contained in Section
5 of the Underwriting Agreement pursuant to which the underwriters have agreed
to indemnify the Company.
5.4.2 Exercise of Purchase Options. Nothing contained in this Purchase
Option shall be construed as requiring the Holder(s) to exercise their Purchase
Options or Warrants underlying such Purchase Options prior to or after the
initial filing of any registration statement or the effectiveness thereof.
5.4.3 Documents Delivered to Holders. The Company shall furnish ▇▇▇▇▇▇
▇▇▇▇▇▇, as representative of the Holders participating in any of the foregoing
offerings, a signed counterpart, addressed to the participating Holders, of (i)
an opinion of counsel to the Company, dated the effective date of such
registration statement (and, if such registration includes an underwritten
public offering, an opinion dated the date of the closing under any underwriting
agreement related thereto), and (ii) a "cold comfort" letter dated the effective
date of such registration statement (and, if such registration includes an
underwritten public offering, a letter dated the date of the closing under the
underwriting agreement) signed by the independent public accountants who have
issued a report on the Company's financial statements included in such
registration statement, in each case covering substantially the same matters
with respect to such registration statement (and the prospectus included
therein) and, in the case of such accountants' letter, with respect to events
subsequent to the date of such financial statements, as are customarily covered
in opinions of issuer's counsel and in accountants' letters delivered to
underwriters in underwritten public offerings of securities. The Company shall
also deliver promptly to ▇▇▇▇▇▇ ▇▇▇▇▇▇, as representative of the Holders
participating in the offering, the correspondence and memoranda described below
and 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
▇▇▇▇▇▇ ▇▇▇▇▇▇, as representative of the Holders, 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 the National Association of Securities
Dealers, Inc. ("NASD"). 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 and as often as ▇▇▇▇▇▇ ▇▇▇▇▇▇, as representative of the
Holders, shall reasonably request. The Company shall not be required to disclose
any confidential information or other records to ▇▇▇▇▇▇ ▇▇▇▇▇▇, as
representative of the Holders, or to any other person, until and unless such
persons shall have entered into reasonable confidentiality agreements (in form
and substance reasonably satisfactory to the Company), with the Company with
respect thereto.
5.4.4 Underwriting Agreement. The Company shall enter into an
underwriting agreement with the managing underwriter(s), if any, selected by any
Holders whose Registrable Securities are being registered pursuant to this
Section 5, which managing underwriter shall be reasonably acceptable 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 and their intended methods of distribution. Such
Holders, however, shall agree to such covenants and indemnification and
contribution obligations for selling stockholders as are customarily contained
in agreements of that type used by the managing underwriter. Further, such
Holders shall execute appropriate custody agreements and otherwise cooperate
fully in the preparation of the registration statement and other documents
relating to any offering in which they include securities pursuant to this
Section 5. Each Holder shall also furnish to the Company such information
regarding itself, the Registrable Securities held by it, and the intended method
of disposition of such securities as shall be reasonably required to effect the
registration of the Registrable Securities.
5.4.5 Rule 144 Sale. Notwithstanding anything contained in this
Section 5 to the contrary, the Company shall have no obligation pursuant to
Sections 5.1 or 5.2 for the registration of Registrable Securities held by any
Holder (i) where such Holder would then be entitled to sell under Rule 144
within any three-month period (or such other period prescribed under Rule 144 as
may be provided by amendment thereof) all of the Registrable Securities then
held by such Holder, and (ii) where the number of Registrable Securities held by
such Holder is within the volume limitations under paragraph (e) of Rule 144
(calculated as if such Holder were an affiliate within the meaning of Rule 144).
5.4.6 Supplemental Prospectus. Each Holder agrees, that upon receipt
of any notice from the Company of the happening of any event as a result of
which the prospectus included in the registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading in light of the circumstances then existing, such Holder will
immediately discontinue disposition of Registrable Securities pursuant to the
registration statement covering such Registrable Securities until such ▇▇▇▇▇▇'s
receipt of the copies of a supplemental or amended prospectus, and, if so
desired by the Company, such Holder shall deliver to the Company (at the expense
of the Company) or destroy (and deliver to the Company a certificate of such
destruction) all copies, other than permanent file copies then in such Holder's
possession, of the prospectus covering such Registrable Securities current at
the time of receipt of such notice.
6. ADJUSTMENTS.
6.1 Adjustments to Exercise Price and Number of Securities. The Exercise
Price and the number of Units underlying the Purchase Option shall be subject to
adjustment from time to time as hereinafter set forth:
6.1.1 Stock Dividends - Split-Ups. If after the date hereof, and
subject to the provisions of Section 6.4 below, the number of outstanding Shares
is increased by a stock dividend payable in Shares or by a split-up of Shares or
other similar event, then, on the effective date thereof, the number of Shares
underlying each of the Units purchasable hereunder shall be increased in
proportion to such increase in outstanding shares. In such case, the number of
Shares, and the exercise price applicable thereto, underlying the Warrants
underlying each of the Units purchasable hereunder shall be adjusted in
accordance with the terms of the Warrants. For example, if the Company declares
a two-for-one stock dividend and at the time of such dividend this Purchase
Option is for the purchase of one Unit at $10.00 per whole Unit (each Warrant
underlying the Units is exercisable for $6.00 per share), upon effectiveness of
the dividend, this Purchase Option will be adjusted to allow for the purchase of
one Unit at $10.00 per Unit, each Unit entitling the holder to receive two
Shares and two Warrants (each Warrant exercisable for $5.00 per share).
6.1.2 Aggregation of Shares. If after the date hereof, and subject to
the provisions of Section 6.4, the number of outstanding Shares is decreased by
a consolidation, combination or reclassification of Shares or other similar
event, then, on the effective date thereof, the number of Shares underlying each
of the Units purchasable hereunder shall be decreased in proportion to such
decrease in outstanding shares. In such case, the number of Shares, and the
exercise price applicable thereto, underlying the Warrants underlying each of
the Units purchasable hereunder shall be adjusted in accordance with the terms
of the Warrants.
6.1.3 Replacement of Securities upon Reorganization, etc. In case of
any reclassification or reorganization of the outstanding Shares other than a
change covered by Section 6.1.1 or 6.1.2 hereof or that solely affects the par
value of such Shares, or in the case of any merger or consolidation of the
Company with or into another corporation (other than a consolidation or merger
in which the Company is the continuing corporation and that does not result in
any reclassification or reorganization of the outstanding Shares), or in the
case of any sale or conveyance to another corporation or entity of the property
of the Company as an entirety or substantially as an entirety in connection with
which the Company is dissolved, the Holder of this Purchase Option shall have
the right thereafter (until the expiration of the right of exercise of this
Purchase Option) to receive upon the exercise hereof, for the same aggregate
Exercise Price payable hereunder immediately prior to such event, the kind and
amount of shares or other securities or property (including cash) receivable
upon such reclassification, reorganization, merger or consolidation, or upon a
dissolution following any such sale or transfer, by a Holder of the number of
Shares of the Company obtainable upon exercise of this Purchase Option and the
underlying Warrants immediately prior to such event; and if any reclassification
also results in a change in Shares covered by Section 6.1.1 or 6.1.2, then such
adjustment shall be made pursuant to Sections 6.1.1, 6.1.2 and this Section
6.1.3. The provisions of this Section 6.1.3 shall similarly apply to successive
reclassifications, reorganizations, mergers or consolidations, sales or other
transfers.
6.1.4 Changes in Form of Purchase Option. This form of Purchase Option
need not be changed because of any change pursuant to this Section, and Purchase
Options issued after such change may state the same Exercise Price and the same
number of Units as are stated in the Purchase Options initially issued pursuant
to this Agreement. The acceptance by any Holder of the issuance of new Purchase
Options reflecting a required or permissive change shall not be deemed to waive
any rights to an adjustment occurring after the Commencement Date or the
computation thereof.
6.1.5 Adjustments of Warrants. To the extent the price of the Warrants
are lowered pursuant to Section 3.1 of the Warrant Agreement, dated ___________
__, 2007, between the Company and American Stock Transfer & Trust Company (the
"WARRANT AGREEMENT") the price of the Warrants underlying the Purchase Option
shall be reduced on identical percentage terms. To the extent the duration of
the Warrants is extended pursuant to
Section 3.2 of the Warrant Agreement, the duration of the Warrants underlying
the Purchase Option shall be extended on identical terms.
6.2 Substitute Purchase Option. In case of any consolidation of the Company
with, or merger of the Company with, or merger of the Company into, another
corporation (other than a consolidation or merger which does not result in any
reclassification or change of the outstanding Shares), the corporation formed by
such consolidation or merger shall execute and deliver to the Holder a
supplemental Purchase Option providing that the holder of each Purchase Option
then outstanding or to be outstanding shall have the right thereafter (until the
stated expiration of such Purchase Option) to receive, upon exercise of such
Purchase Option, the kind and amount of shares and other securities and property
receivable upon such consolidation or merger, by a holder of the number of
Shares of the Company for which such Purchase Option might have been exercised
immediately prior to such consolidation, merger, sale or transfer. Such
supplemental Purchase Option shall provide for adjustments which shall be
identical to the adjustments provided in Section 6. The above provision of this
Section shall similarly apply to successive consolidations or mergers.
6.3 Elimination of Fractional Interests. The Company shall not be required
to issue certificates representing fractions of Shares or Warrants upon the
exercise of the Purchase Option, nor shall it be required to issue scrip or pay
cash in lieu of any fractional interests, it being the intent of the parties
that all fractional interests shall be eliminated by rounding any fraction up or
down to the nearest whole number of Warrants, Shares or other securities,
properties or rights.
7. RESERVATION AND LISTING. The Company shall at all times reserve and keep
available out of its authorized Shares, solely for the purpose of issuance upon
exercise of the Purchase Options or the Warrants underlying the Purchase Option,
such number of Shares or other securities, properties or rights as shall be
issuable upon the exercise thereof. The Company covenants and agrees that, upon
exercise of the Purchase Options and payment of the Exercise Price therefor, all
Shares and other securities issuable upon such exercise shall be duly and
validly issued, fully paid and non-assessable and not subject to preemptive
rights of any stockholder. The Company further covenants and agrees that upon
exercise of the Warrants underlying the Purchase Options and payment of the
respective Warrant exercise price therefor, all Shares and other securities
issuable upon such exercise shall be duly and validly issued, fully paid and
non-assessable and not subject to preemptive rights of any stockholder. As long
as the Purchase Options shall be outstanding, the Company shall use its best
efforts to cause all (i) Units and Shares issuable upon exercise of the Purchase
Options, (iii) Warrants issuable upon exercise of the Purchase Options and (iv)
Shares issuable upon exercise of the Warrants included in the Units issuable
upon exercise of the Purchase Option to be listed (subject to official notice of
issuance) on all securities exchanges (or, if applicable on the Nasdaq National
Market, SmallCap Market, OTC Bulletin Board or any successor trading market) on
which the Units, the Shares or the Public Warrants issued to the public in
connection with the Offering may then be listed and/or quoted.
8. CERTAIN NOTICE REQUIREMENTS.
8.1 Holder's Right to Receive Notice. Nothing herein shall be construed as
conferring upon the Holders the right to vote or consent as a stockholder for
the election of directors or any
other matter, or as having any rights whatsoever as a stockholder of the
Company. If, however, at any time prior to the expiration of the Purchase
Options and their exercise, any of the events described in Section 8.2 shall
occur, then, in one or more of said events, the Company shall give written
notice of such event at least fifteen days prior to the date fixed as a record
date or the date of closing the transfer books for the determination of the
stockholders entitled to such dividend, distribution, conversion or exchange of
securities or subscription rights, or entitled to vote on such proposed
dissolution, liquidation, winding up or sale. Such notice shall specify such
record date or the date of the closing of the transfer books, as the case may
be. Notwithstanding the foregoing, the Company shall deliver to each Holder a
copy of each notice given to the other stockholders of the Company at the same
time and in the same manner that such notice is given to the stockholders.
8.2 Events Requiring Notice. The Company shall be required to give the
notice described in this Section 8 upon one or more of the following events: (i)
if the Company shall take a record of the holders of its Shares for the purpose
of entitling them to receive a dividend or distribution payable otherwise than
in cash, or a cash dividend or distribution payable otherwise than out of
retained earnings, as indicated by the accounting treatment of such dividend or
distribution on the books of the Company, or (ii) the Company shall offer to all
the holders of its Shares any additional shares of capital stock of the Company
or securities convertible into or exchangeable for shares of capital stock of
the Company, or any option, right or warrant to subscribe therefor, or (iii) a
dissolution, liquidation or winding up of the Company (other than in connection
with a consolidation or merger) or a sale of all or substantially all of its
property, assets and business shall be proposed.
8.3 Notice of Change in Exercise Price. The Company shall, promptly after
an event requiring a change in the Exercise Price pursuant to Section 6 hereof,
send notice to the Holders of such event and change ("PRICE NOTICE"). The Price
Notice shall describe the event causing the change and the method of calculating
same and shall be certified as being true and accurate by the Company's
President and Chief Financial Officer.
8.4 Transmittal of Notices. All notices, requests, consents and other
communications under this Purchase Option shall be in writing and shall be
deemed to have been duly made when hand delivered, or mailed by express mail or
private courier service: (i) if to the registered Holder of the Purchase Option,
to the address of such Holder as shown on the books of the Company, or (ii) if
to the Company, to the following address or to such other address as the Company
may designate by notice to the Holders:
Inter-Atlantic Financial, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇, CEO
9. MISCELLANEOUS.
9.1 Amendments. The Company and ▇▇▇▇▇▇ ▇▇▇▇▇▇ may from time to time
supplement or amend this Purchase Option without the approval of any of the
Holders in order to cure any ambiguity, to correct or supplement any provision
contained herein that may be
defective or inconsistent with any other provisions herein, or to make any other
provisions in regard to matters or questions arising hereunder that the Company
and ▇▇▇▇▇▇ ▇▇▇▇▇▇ may ▇▇▇▇ necessary or desirable and that the Company and
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ shall not adversely affect the interest of the Holders. All
other modifications or amendments shall require the written consent of and be
signed by the party against whom enforcement of the modification or amendment is
sought.
9.2 Headings. The headings contained herein are for the sole purpose of
convenience of reference, and shall not in any way limit or affect the meaning
or interpretation of any of the terms or provisions of this Purchase Option.
9.3 Entire Agreement. This Purchase Option (together with the other
agreements and documents being delivered pursuant to or in connection with this
Purchase Option) constitutes the entire agreement of the parties hereto with
respect to the subject matter hereof, and supersedes all prior agreements and
understandings of the parties, oral and written, with respect to the subject
matter hereof.
9.4 Binding Effect. This Purchase Option shall inure solely to the benefit
of and shall be binding upon, the Holder and the Company and their permitted
assignees, respective successors, legal representative and assigns, and no other
person shall have or be construed to have any legal or equitable right, remedy
or claim under or in respect of or by virtue of this Purchase Option or any
provisions herein contained.
9.5 Governing Law; Submission to Jurisdiction. This Purchase Option shall
be governed by and construed and enforced in accordance with the laws of the
State of New York, without giving effect to conflict of laws. The Company hereby
agrees that any action, proceeding or claim against it arising out of, or
relating in any way to this Purchase Option shall be brought and enforced in the
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 it at the address set forth in Section
8 hereof. Such mailing shall be deemed personal service and shall be legal and
binding upon the Company in any action, proceeding or claim. The Company and the
Holder agree that the prevailing party(ies) in any such action shall be entitled
to recover from the other party(ies) all of its reasonable attorneys' fees and
expenses relating to such action or proceeding and/or incurred in connection
with the preparation therefor.
9.6 Waiver, Etc. The failure of the Company or the Holder to at any time
enforce any of the provisions of this Purchase Option shall not be deemed or
construed to be a waiver of any such provision, nor to in any way affect the
validity of this Purchase Option or any provision hereof or the right of the
Company or any Holder to thereafter enforce each and every provision of this
Purchase Option. No waiver of any breach, non-compliance or non-fulfillment of
any of the provisions of this Purchase Option shall be effective unless set
forth in a written instrument executed by the party or parties against whom or
which enforcement of such waiver is sought;
and no waiver of any such breach, non-compliance or non- fulfillment shall be
construed or deemed to be a waiver of any other or subsequent breach or
non-compliance.
9.7 Execution in Counterparts. This Purchase Option may be executed in one
or more counterparts, and by the different parties hereto in separate
counterparts, each of which shall be deemed to be an original, but all of which
taken together shall constitute one and the same agreement, and shall become
effective when one or more counterparts has been signed by each of the parties
hereto and delivered to each of the other parties hereto.
9.8 Exchange Agreement. As a condition of the Holder's receipt and
acceptance of this Purchase Option, ▇▇▇▇▇▇ agrees that, at any time prior to the
complete exercise of this Purchase Option by ▇▇▇▇▇▇, if the Company and ▇▇▇▇▇▇
▇▇▇▇▇▇ enter into an agreement ("EXCHANGE AGREEMENT") pursuant to which they
agree that all outstanding Purchase Options will be exchanged for securities or
cash or a combination of both, then Holder shall agree to such exchange and
become a party to the Exchange Agreement.
IN WITNESS WHEREOF, the Company has caused this Purchase Option to be
signed by its duly authorized officer as of the ___ day of _________ 2007.
INTER-ATLANTIC FINANCIAL, INC.
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Form to be used to exercise Purchase Option:
Inter-Atlantic Financial, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇, CEO
Date: _________________, 20__
The undersigned hereby elects irrevocably to exercise all or a portion of
the within Purchase Option and to purchase ____ Units of Inter-Atlantic
Financial, Inc. and hereby makes payment of $____________ (at the rate of $____
per Unit) in payment of the Exercise Price pursuant thereto. Please issue the
Shares and Warrants as to which this Purchase Option is exercised in accordance
with the instructions given below.
or
The undersigned hereby elects irrevocably to convert its right to purchase
_________ Units purchasable under the within Purchase Option by surrender of the
unexercised portion of the attached Purchase Option (with a "Value" of $_______
based on a "Market Price" of $_______). Please issue the securities comprising
the Units as to which this Purchase Option is exercised in accordance with the
instructions given below.
----------------------------------------
NOTICE: The signature to this assignment
must correspond with the name as written
upon the face of the purchase option in
every particular, without alteration or
enlargement or any change whatever.
Signature(s) Guaranteed:
------------------------------------
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION
(BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH
MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM, PURSUANT TO
S.E.C. RULE 17Ad-15).
INSTRUCTIONS FOR REGISTRATION OF SECURITIES
Name
___________________________________________________________________________
(Print in Block Letters)
Address
___________________________________________________________________________
Form to be used to assign Purchase Option:
ASSIGNMENT
(To be executed by the registered Holder to effect a transfer of the within
Purchase Option):
FOR VALUE RECEIVED, ______________________________________________ does
hereby sell, assign and transfer unto _________________________________________
the right to purchase __________ Units of Inter-Atlantic Financial, Inc.
("COMPANY") evidenced by the within Purchase Option and does hereby authorize
the Company to transfer such right on the books of the Company.
Dated: , 200
------------------- -
----------------------------------------
Signature
----------------------------------------
NOTICE: The signature to this assignment
must correspond with the name as written
upon the face of the purchase option in
every particular, without alteration or
enlargement or any change whatever.
Signature(s) Guaranteed:
-------------------------------------
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION
(BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH
MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM, PURSUANT TO
S.E.C. RULE 17Ad-15).