Attached files
| file | filename |
|---|---|
| 10-Q - China Housing & Land Development, Inc. | v193456_10q.htm |
| EX-4.2 - China Housing & Land Development, Inc. | v193456_ex4-2.htm |
| EX-4.1 - China Housing & Land Development, Inc. | v193456_ex4-1.htm |
| EX-32.2 - China Housing & Land Development, Inc. | v193456_ex32-2.htm |
| EX-31.2 - China Housing & Land Development, Inc. | v193456_ex31-2.htm |
| EX-31.1 - China Housing & Land Development, Inc. | v193456_ex31-1.htm |
| EX-32.1 - China Housing & Land Development, Inc. | v193456_ex32-1.htm |
THIS
WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT (COLLECTIVELY,
THE “SECURITIES”) HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES (COLLECTIVELY,
THE “ACTS”). THE SECURITIES MAY NOT BE SOLD, DISTRIBUTED, OFFERED,
PLEDGED, ENCUMBERED, ASSIGNED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF THE
FOLLOWING: (1) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE
ACTS COVERING THE TRANSACTION, (2) THE COMPANY RECEIVES AN OPINION OF COUNSEL
REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED
UNDER THE ACTS, OR (3) THE COMPANY OTHERWISE SATISFIES ITSELF THAT REGISTRATION
IS NOT REQUIRED UNDER THE ACTS.
|
Warrant
No.: ______
|
Number
of Shares: ______
|
|
Date
of Issuance: ______, 2010
|
(subject
to adjustment)
|
AMENDED
AND RESTATED
STOCK
PURCHASE WARRANT
To
Subscribe for and Purchase
Common
Stock of
China
Housing & Land Development, Inc.
THIS CERTIFIES THAT, for value received
_______(the “Investor”), or
registered assigns, is entitled to subscribe for and purchase from China Housing
& Land Development, Inc. (the “Company”), a
corporation organized and existing under the laws of the State of Nevada, with
headquarters located at 6 Youyi Dong Lu, Han Yuan 4 Lou, Xi’An, Shaanxi
Province, China 710054, at the price specified below (subject to adjustment as
noted below) at any time after the date hereof to and including February 28,
2013 (the “Expiration Date”)
______ fully paid and
nonassessable shares of the Company’s common stock (the “Common Stock”)
(subject to adjustment as noted below). This Warrant has been issued
pursuant to a Securities Purchase Agreement dated January 28, 2008 by and among
the Company and the Investors named on the signature pages thereto, as amended
by a First Amendment dated June __, 2010 (as so amended and as
hereafter amended, restated or otherwise modified, the “Purchase Agreement”),
pursuant to which, among other things, the Company agreed to issue its Senior
Secured Convertible Notes in the original principal amount of up to
US$20,000,000 to the Investor (the “Convertible
Notes”).
The warrant purchase price (subject to
adjustment as noted below) shall be $6.07 per share (“Initial Exercise
Price”).
This Warrant is subject to the
following provisions, terms and conditions:
1. The
rights represented by this Warrant may be exercised by the holder hereof, in
whole or from time to time in part, by written notice of exercise delivered to
the Company and by the surrender of this Warrant (properly endorsed if required)
at the principal office of the Company and upon payment to it by wire transfer,
certified check, bank draft or cash of the purchase price for such shares or by
cashless exercise pursuant to paragraph 10. The Company agrees that
the shares so purchased shall be and are deemed to be issued to the holder
hereof as the record owner of such shares as of the close of business on the
date on which this Warrant shall have been surrendered and payment made for such
shares as aforesaid. Subject to the provisions of the next succeeding
paragraph, certificates for the shares of stock so purchased, together with a
check in payment of any fractional share and, in the case of a partial exercise,
a new warrant evidencing the shares remaining subject to this Warrant, shall be
delivered to the holder hereof within a reasonable time, not exceeding 5
business days, after the rights represented by this Warrant shall have been so
exercised.
2. Notwithstanding
the foregoing, however, the Company shall not be required to deliver any
certificate for shares of stock upon exercise of this Warrant except in
accordance with the provisions, and subject to the limitations, of
paragraph 6 hereof.
3. The
Company represents and warrants that this Warrant has been duly authorized by
all necessary corporate action, has been duly executed and delivered and is a
legal and binding obligation of the Company. The Company covenants
and agrees that all shares which may be issued upon the exercise of the rights
represented by this Warrant according to the terms hereof will, upon issuance,
be duly authorized and issued, fully paid and nonassessable. The
Company further covenants and agrees that during the period within which the
rights represented by this Warrant may be exercised, the Company will at all
times have authorized, and reserved for the purpose of issue or transfer upon
exercise of the subscription rights evidenced by this Warrant, a sufficient
number of shares of its Common Stock to provide for the exercise of the rights
represented by this Warrant. The Company further covenants and agrees
that the Company will not, by amendment of its Articles 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 items
and in the taking of all such action as may be necessary or appropriate in order
to protect the rights of the holder hereof against dilution or other
impairment. Without limiting the generality of the foregoing, the
Company will not increase the par value of any shares of stock receivable on the
exercise of this Warrant above the amount payable therefor on such
exercise.
2
4. The
above provisions are, however, subject to the following:
(a) The
warrant purchase price shall, from and after the date of issuance of this
Warrant, be subject to adjustment from time to time as hereinafter
provided. Upon each adjustment of the warrant purchase price, the
holder of this Warrant shall thereafter be entitled to purchase, at the warrant
purchase price resulting from such adjustment, the number of shares obtained by
multiplying the warrant purchase price in effect immediately prior to such
adjustment by the number of shares purchasable pursuant hereto immediately prior
to such adjustment and dividing the product thereof by the warrant purchase
price resulting from such adjustment.
(b) If
and whenever the Company shall issue or sell any shares of its Common Stock for
a consideration per share less than the warrant purchase price in effect
immediately prior to the time of such issue or sale, then, forthwith upon such
issue or sale, the warrant purchase price shall be reduced to such lesser
price.
(c) For
the purposes of paragraph (b), the following provisions (i) to (v),
inclusive, shall also be applicable:
(i)
In case
at any time the Company shall grant (whether directly or by assumption in a
merger or otherwise) any rights to subscribe for or to purchase, or any options
for the purchase of, (aa) Common Stock or (bb) any obligations or any
shares of stock of the Company which are convertible into or exchangeable for
Common Stock (any of such obligations or shares of stock being hereinafter
called “Convertible
Securities”) whether or not such rights or options or the right to
convert or exchange any such Convertible Securities are immediately exercisable,
and the price per share for which Common Stock is issuable upon the exercise of
such rights or options or upon conversion or exchange of such Convertible
Securities (determined by dividing (aa) the total amount, if any, received
or receivable by the Company as consideration for the granting of such rights or
options (determined in accordance with clause (iii) below), plus the minimum
aggregate amount of additional consideration payable to the Company upon the
exercise of such rights or options, plus, in the case of such rights or options
which relate to Convertible Securities, the minimum aggregate amount of
additional consideration, if any, payable upon the issue or sale of such
Convertible Securities and upon the conversion or exchange thereof, by
(bb) the total maximum number of shares of Common Stock issuable upon the
exercise of such rights or options or upon the conversion or exchange of all
such Convertible Securities issuable upon the exercise of such rights or
options) shall be less than the warrant purchase price in effect immediately
prior to the time of the granting of such rights or options, then the total
maximum number of shares of Common Stock issuable upon the exercise of such
rights or options or upon conversion or exchange of the total maximum amount of
such Convertible Securities issuable upon the exercise of such rights or options
shall (as of the date of granting of such rights or options) be deemed to have
been issued for such price per share. Except as provided in
paragraph (f) below, no further adjustments of the warrant purchase price
shall be made upon the actual issue of such Common Stock or of such Convertible
Securities upon exercise of such rights or options or upon the actual issue of
such Common Stock upon conversion or exchange of such Convertible
Securities.
3
(ii)
In case
the Company shall issue or sell (whether directly or by assumption in a merger
or otherwise) any Convertible Securities, whether or not the rights to exchange
or convert thereunder are immediately exercisable, and the price per share for
which Common Stock is issuable upon such conversion or exchange (determined by
dividing (aa) the total amount received or receivable by the Company as
consideration for the issue or sale of such Convertible Securities (determined
in accordance with clause (iii) below), plus the minimum aggregate amount of
additional consideration, if any, payable to the Company upon the conversion or
exchange thereof, by (bb) the total maximum number of shares of Common
Stock issuable upon the conversion or exchange of all such Convertible
Securities) shall be less than the warrant purchase price in effect immediately
prior to the time of such issue or sale, then the total maximum number of shares
of Common Stock issuable upon conversion or exchange of all such Convertible
Securities shall (as of the date of the issue or sale of such Convertible
Securities) be deemed to be outstanding and to have been issued for such price
per share, provided that (x) except as provided in paragraph (f)
below, no further adjustments of the warrant purchase price shall be made upon
the actual issue of such Common Stock upon conversion or exchange of such
Convertible Securities, and (y) if any such issue or sale of such
Convertible Securities is made upon exercise of any rights to subscribe for or
to purchase or any option to purchase any such Convertible Securities for which
adjustments of the warrant purchase price have been or are to be made pursuant
to other provisions of this paragraph (c), no further adjustment of the
warrant purchase price shall be made by reason of such issue or
sale.
(iii)
In case
any shares of Common Stock or Convertible Securities or any rights or options to
purchase any such Common Stock or Convertible Securities shall be issued or sold
for cash, the consideration received therefor shall be deemed to be the amount
received by the Company therefor, without deduction therefrom of any expenses
incurred or any underwriting commissions, discounts or concessions paid or
allowed by the Company in connection therewith. In case any shares of
Common Stock or Convertible Securities or any rights or options to purchase any
such Common Stock or Convertible Securities shall be issued or sold for a
consideration other than cash, the amount of the consideration other than cash
received by the Company shall be deemed to be the fair value of such
consideration as determined by the Board of Directors of the Company, without
deducting therefrom of any expenses incurred or any underwriting commissions,
discounts or concessions paid or allowed by the Company in connection
therewith. In case any shares of Common Stock or Convertible
Securities or any rights or options to purchase such Common Stock or Convertible
Securities shall be issued in connection with any merger or consolidation in
which the Company is the surviving corporation, the amount of consideration
therefor shall be deemed to be the fair value as determined by the Board of
Directors of the Company of such portion of the assets and business of the
non-surviving corporation or corporations as such Board shall determine to be
attributable to such Common Stock, Convertible Securities, rights or options, as
the case may be. In the event of any consolidation or merger of the
Company in which the Company is not the surviving corporation or in the event of
any sale of all or substantially all of the assets of the Company for stock or
other securities of any other corporation, the Company shall be deemed to have
issued a number of shares of its Common Stock for stock or securities of the
other corporation computed on the basis of the actual exchange ratio on which
the transaction was predicated and for a consideration equal to the fair market
value on the date of such transaction of such stock or securities of the other
corporation, and if any such calculation results in adjustment of the warrant
purchase price, the determination of the number of shares of Common Stock
issuable upon exercise of this Warrant immediately prior to such merger,
conversion or sale, for purposes of paragraph (g) below, shall be made
after giving effect to such adjustment of the warrant purchase
price.
4
(iv)
In case
the Company shall take a record of the holders of its Common Stock for the
purpose of entitling them (aa) to receive a dividend or other distribution
payable in Common Stock or in Convertible Securities, or in any rights or
options to purchase any Common Stock or Convertible Securities, or (bb) to
subscribe for or purchase Common Stock or Convertible Securities, then such
record date shall be deemed to be the date of the issue or sale of the shares of
Common Stock deemed to have been issued or sold upon the declaration of such
dividend or the making of such other distribution or the date of the granting of
such rights of subscription or purchase, as the case may be.
(v)
The
number of shares of Common Stock outstanding at any given time shall not include
shares owned or held by or for the account of the Company, and the disposition
of any such shares shall be considered an issue or sale of Common Stock for the
purposes of this paragraph (c).
(d)
In case the Company shall (i) declare a dividend upon the
Common Stock payable in Common Stock (other than a dividend declared to effect a
subdivision of the outstanding shares of Common Stock, as described in
subparagraph (e) below) or Convertible Securities, or in any rights or
options to purchase any Common Stock or Convertible Securities, or
(ii) declare any other dividend or make any other distribution upon the
Common Stock payable otherwise than out of earnings or earned surplus, then
thereafter the holder of this Warrant upon the exercise hereof will be entitled
to receive the number of shares of Common Stock to which such holder shall be
entitled upon such exercise, and, in addition and without further payment
therefor, such number of shares of Common Stock, such that upon exercise hereof,
such holder would receive such number of shares of Common Stock as a result of
each dividend described in clause (i) above and each dividend or
distribution described in clause (ii) above which such holder would have
received by way of any such dividend or distribution if continuously since the
record date for any such dividend or distribution such holder (i) had been
the record holder of the number of shares of Common Stock then received, and
(ii) had retained all dividends or distributions in stock or securities
(including Common Stock or Convertible Securities, or in any rights or options
to purchase any Common Stock or Convertible Securities) payable in respect of
such Common Stock or in respect of any stock or securities paid as dividends or
distributions and originating directly or indirectly from such Common
Stock. For the purposes of the foregoing, a dividend or distribution
other than in cash shall be considered payable out of earnings or surplus only
to the extent that such earnings or surplus are charged an amount equal to the
fair value of such dividend as determined by the Board of Directors of the
Company.
5
(e)
In case the Company shall at any time subdivide
its outstanding shares of Common Stock into a greater number of shares, the
warrant purchase price in effect immediately prior to such subdivision shall be
proportionately reduced, and conversely, in case the outstanding shares of
Common Stock of the Company shall be combined into a smaller number of shares,
the warrant purchase price in effect immediately prior to such combination shall
be proportionately increased.
(f)
If (i) the purchase price provided for in any right or option referred to in
clause (i) of paragraph (c), or (ii) the additional consideration, if any,
payable upon the conversion or exchange of Convertible Securities referred to in
clause (i) or clause (ii) of paragraph (c), or (iii) the rate at which any
Convertible Securities referred to in clause (i) or clause (ii) of paragraph (c)
are convertible into or exchangeable for Common Stock shall change at any time
(other than under or by reason of provisions designed to protect against
dilution), the warrant purchase price then in effect shall forthwith be
increased or decreased to such warrant purchase price which would have obtained
had the adjustments made upon the issuance of such rights, options or
Convertible Securities been made upon the basis of (i) the issuance of the
number of shares of Common Stock theretofore actually delivered upon the
exercise of such options or rights or upon the conversion or exchange of such
Convertible Securities, and the total consideration received therefor, and (ii)
the issuance at the time of such change of any such options, rights or
Convertible Securities then still outstanding for the consideration, if any,
received by the Company therefor and to be received on the basis of such changed
price; and on the expiration of any such option or right or the termination of
any such right to convert or exchange such Convertible Securities, the warrant
purchase price then in effect hereunder shall forthwith be increased to such
warrant purchase price which would have obtained had the adjustments made upon
the issuance of such rights or options or Convertible Securities been made upon
the basis of the issuance of the shares of Common Stock theretofore actually
delivered (and the total consideration received therefor) upon the exercise of
such rights or options or upon the conversion or exchange of such Convertible
Securities. If the purchase price provided for in any such right or option
referred to in clause (i) of paragraph (c) or the rate at which any Convertible
Securities referred to in clause (i) or clause (ii) of paragraph (c) are
convertible into or exchangeable for Common Stock shall decrease at any time
under or by reason of provisions with respect thereto designed to protect
against dilution, then in case of the delivery of Common Stock upon the exercise
of any such right or option or upon conversion or exchange of any such
Convertible Security, the warrant purchase price then in effect hereunder shall
forthwith be decreased to such warrant purchase price as would have obtained had
the adjustments made upon the issuance of such right, option or Convertible
Securities been made upon the basis of the issuance of (and the total
consideration received for) the shares of Common Stock delivered as
aforesaid.
6
(g)
If any capital reorganization or reclassification of the capital stock of
the Company, or consolidation or merger of the Company with another corporation,
or the sale of all or substantially all of its assets to another corporation
shall be effected in such a way that holders of Common Stock shall be entitled
to receive stock, securities or assets with respect to or in exchange for Common
Stock, then, as a condition of such reorganization, reclassification,
consolidation, merger or sale, lawful and adequate provision shall be made
whereby the holder hereof shall thereafter have the right to purchase and
receive, upon the basis and upon the terms and conditions specified in this
Warrant and in lieu of the shares of the Common Stock of the Company immediately
theretofore purchasable and receivable upon the exercise of the rights
represented hereby, such shares of stock, securities or assets as may be issued
or payable with respect to or in exchange for a number of outstanding shares of
such Common Stock equal to the number of shares of such stock immediately
theretofore purchasable and receivable upon the exercise of the rights
represented hereby had such reorganization, reclassification, consolidation,
merger or sale not taken place, and in any such case appropriate provision shall
be made with respect to the rights and interests of the holder of this Warrant
to the end that the provisions hereof (including without limitation provisions
for adjustments of the warrant purchase price and of the number of shares
purchasable upon the exercise of this Warrant) shall thereafter be applicable,
as nearly as may be, in relation to any shares of stock, securities or assets
thereafter deliverable upon the exercise hereof. The Company shall not effect
any such consolidation, merger or sale, unless prior to the consummation thereof
the successor corporation (if other than the Company) resulting from such
consolidation or merger or the corporation purchasing such assets shall assume,
by written instrument executed and mailed to the registered holder hereof at the
last address of such holder appearing on the books of the Company, the
obligation to deliver to such holder such shares of stock, securities or assets
as, in accordance with the foregoing provisions, such holder may be entitled to
purchase.
(h) Upon
any adjustment of the warrant purchase price, then and in each such case the
Company shall give written notice thereof, by first-class mail, postage prepaid,
addressed to the registered holder of this Warrant at the address of such holder
as shown on the books of the Company, which notice shall state the warrant
purchase price resulting from such adjustment and the increase or decrease, if
any, in the number of shares purchasable at such price upon the exercise of this
Warrant, setting forth in reasonable detail the method of calculation and the
facts upon which such calculation is based.
(i) In
case any time:
(1)
the
Company shall declare any cash dividend on its capital stock at a rate in excess
of the rate of the last cash dividend theretofore paid;
(2)
the
Company shall pay any dividend payable in stock upon its capital stock or make
any distribution (other than regular cash dividends) to the holders of its
capital stock;
(3)
the
Company shall offer for subscription pro rata to the holders of its capital
stock any additional shares of stock of any class or other
rights;
(4)
there
shall be any capital reorganization, or reclassification of the capital stock of
the Company, or consolidation or merger of the Company with, or sale of all or
substantially all of its assets to, another corporation;
or
7
(5) there
shall be a voluntary or involuntary dissolution, liquidation or winding up of
the Company;
then, in
any one or more of said cases, the Company shall give written notice, by
first-class mail, postage prepaid, addressed to the registered holder of this
Warrant at the address of such holder as shown on the books of the Company, of
the date on which (aa) the books of the Company shall close or a record shall be
taken for such dividend, distribution or subscription rights, or (bb) such
reorganization, reclassification, consolidation, merger, sale, dissolution,
liquidation or winding up, or conversion or redemption shall, or is expected to,
take place, as the case may be. Such notice shall also specify the
date as of which the holders of capital stock of record shall participate in
such dividend, distribution or subscription rights, or shall be entitled to
exchange their capital stock for securities or other property deliverable upon
such reorganization, reclassification, consolidation, merger, sale, dissolution,
liquidation or winding up, or conversion or redemption, as the case may
be. Such written notice shall be given at least 20 days prior to the
action in question and not less than 20 days prior to the record date or the
date on which the Company’s transfer books are closed in respect
thereto.
(j) If
any event occurs as to which in the opinion of the Board of Directors of the
Company the other provisions of this paragraph 4 are not strictly
applicable or if strictly applicable would not fairly protect the purchase
rights of the holder of this Warrant or of Common Stock in accordance with the
essential intent and principles of such provisions, then the Board of Directors
shall make an adjustment in the application of such provisions, in accordance
with such essential intent and principles, so as to protect such purchase rights
as aforesaid.
(k) No
fractional shares of Common Stock shall be issued upon the exercise of this
Warrant, but, instead of any fraction of a share which would otherwise be
issuable, the Company shall pay a cash adjustment (which may be effected as a
reduction of the amount to be paid by the holder hereof upon such exercise) in
respect of such fraction in an amount equal to the same fraction of the Market
Price per share of Common Stock as of the close of business on the date of the
notice required by paragraph l above. “Market Price” shall
mean, if the Common Stock is traded on a securities exchange or on NASDAQ, the
average of the closing prices of the Common Stock on such exchange or NASDAQ on
the 20 trading days ending on the trading day prior to the date of
determination, or, if the Common Stock is otherwise traded in the
over-the-counter market, the average of the closing bid prices on the 20 trading
days ending on the trading day prior to the date of determination. If
at any time the Common Stock is not traded on an exchange or NASDAQ, or
otherwise traded in the over-the-counter market, the Market Price shall be
deemed to be the higher of (i) the book value thereof as determined by any
firm of independent public accountants of recognized standing selected by the
Board of Directors of the Company as of the last day of any month ending within
60 days preceding the date as of which the determination is to be made, or
(ii) the fair value thereof determined in good faith by the Board of
Directors of the Company as of a date which is within 15 days of the date as of
which the determination is to be made.
5. This
Warrant shall not entitle the holder hereof to any voting rights or other rights
as a shareholder of the Company.
8
6. The
holder of this Warrant, by acceptance hereof, agrees to give written notice to
the Company before transferring this Warrant or transferring any Common Stock
issuable or issued upon the exercise hereof (if and only if there is no
effective Registration Statement) of such holder’s intention to do so,
describing briefly the manner of any proposed transfer of this Warrant or such
holder’s intention as to the disposition to be made of shares of Common Stock
issuable or issued upon the exercise hereof. If applicable, such
holder shall also provide the Company with an opinion of counsel satisfactory to
the Company to the effect that the proposed transfer of this Warrant or
disposition of shares may be effected without registration or qualification
(under any federal or state law) of this Warrant or the shares of Common Stock
issuable or issued upon the exercise hereof. Upon receipt of such
written notice and opinion (if applicable) by the Company, such holder shall be
entitled to transfer this Warrant, or to exercise this Warrant in accordance
with its terms and dispose of the shares received upon such exercise or to
dispose of shares of Common Stock received upon the previous exercise of this
Warrant, all in accordance with the terms of the notice delivered by such holder
to the Company, provided that an appropriate legend respecting the aforesaid
restrictions on transfer and disposition may be endorsed on this Warrant or the
certificates for such shares.
7. Subject
to the provisions of paragraph 6 hereof, this Warrant and all rights
hereunder are transferable, in whole or in part, at the principal office of the
Company by the holder hereof in person or by duly authorized attorney, upon
surrender of this Warrant properly endorsed. Each taker and holder of
this Warrant, by taking or holding the same, consents and agrees that the bearer
of this Warrant, when endorsed, may be treated by the Company and all other
persons dealing with this Warrant as the absolute owner hereof for any purpose
and as the person entitled to exercise the rights represented by this Warrant,
or to the transfer hereof on the books of the Company, any notice to the
contrary notwithstanding; but until such transfer on such books, the Company may
treat the registered holder hereof as the owner for all purposes.
8. This
Warrant is exchangeable, upon the surrender hereof by the holder hereof at the
principal office of the Company, for new Warrants of like tenor representing in
the aggregate the right to subscribe for and purchase the number of shares which
may be subscribed for and purchased hereunder, each of such new Warrants to
represent the right to subscribe for and purchase such number of shares as shall
be designated by said holder hereof at the time of such surrender.
9. The
Company covenants and agrees that the holder hereof shall have the rights of an
Investor under the Purchase Agreement and Registration Rights Agreement, each
dated as of January 28, 2008 among the Company and the Investors named on the
signature pages thereto.
9
10. (a) (i)
In addition to and without limiting the rights of the holder of this Warrant
under the terms of this Warrant, the holder of this Warrant shall have the right
(the “Conversion
Right”) to convert this Warrant or any portion thereof into shares of
Common Stock as provided in this paragraph 10(a) at any time or from time
to time prior to its expiration. Upon exercise of the Conversion
Right with respect to a particular number of shares subject to this Warrant (the
“Converted Warrant
Shares”), the Company shall deliver to the holder of this Warrant,
without payment by the holder of any exercise price or any cash or other
consideration, that number of shares of Common Stock equal to the quotient
obtained by dividing the Net Value (as hereinafter defined) of the Converted
Warrant Shares by the fair market value (as defined in paragraph (a)(ii)
below) of a single share of Common Stock, determined in each case as of the
Conversion Date (as hereinafter defined). The “Net Value” of the
Converted Warrant Shares shall be determined by subtracting the aggregate
warrant purchase price of the Converted Warrant Shares from the aggregate fair
market value of the Converted Warrant Shares. Notwithstanding
anything in this paragraph 10 to the contrary, the Conversion Right cannot
be exercised with respect to a number of Converted Warrant Shares having a Net
Value below $100. No fractional shares shall be issuable upon
exercise of the Conversion Right, and if the number of shares to be issued in
accordance with the foregoing formula is other than a whole number, the Company
shall pay to the holder of this Warrant an amount in cash equal to the fair
market value of the resulting fractional share.
(ii) For
purposes of this paragraph 10(a), the “fair market value” of
a share of Common Stock as of a particular date shall be its Market Price,
calculated as described in paragraph 4(k) hereof (assuming for this purpose
that references to “date of
determination” (or words of similar import) in paragraph 4(k) shall be
deemed references to “Conversion
Date”).
(b) In
addition to and without limiting the rights of the holder of this
Warrant under the terms of this Warrant, the holder of this Warrant shall have
the right (the “Alternate
Conversion Right”) to convert this Warrant in whole, but not in part,
into shares of Common Stock as provided in this paragraph 10(b) at any time upon
or following the conversion by the holder of this Warrant and its affiliates in
the aggregate of at least 55% of the aggregate Face Amount of the Convertible
Notes issued to the holder and such affiliates pursuant to paragraph 1 thereof
and up to and including the date that is 5 business days following the date the
post effective amendment referred to in paragraph 5 of the First Amendment dated
May __, 2010 to the Purchase Agreement has been declared effective and the
Company has given written notice thereof to the holder of this
Warrant. Upon exercise of the Alternate Conversion Right with respect
to a particular number of shares subject to this Warrant (the “Alternate
Converted Warrant Shares”), the Company shall deliver to the holder of
this Warrant, without payment by the holder of any exercise price or any cash or
other consideration, that number of shares of Common Stock equal to the quotient
obtained by dividing the number of Alternate Converted Warrant Shares by
2. No
fractional shares shall be issuable upon exercise of the Alternate Conversion
Right, and if the number of shares to be issued in accordance with the foregoing
formula is other than a whole number, the Company shall pay to the holder of
this Warrant an amount in cash equal to the fair market value of the resulting
fractional share.
10
11. No
holder of this Warrant shall have the right to exercise this Warrant, to the
extent that after giving effect to such exercise, such holder (together with
such holder’s affiliates) would beneficially own in excess of 9.99% of the
shares of the Common Stock outstanding immediately after giving effect to such
exercise. For purposes of the foregoing sentence, the aggregate
number of shares of Common Stock beneficially owned by such holder and its
affiliates shall include the number of shares of Common Stock issuable upon
exercise of this Warrant with respect to which the determination of such
sentence is being made, but shall exclude shares of Common Stock which would be
issuable upon (i) exercise of the remaining, unexercised portion of this Warrant
beneficially owned by such holder and its affiliates and (ii) exercise or
conversion of the unexercised or unconverted portion of any other securities of
the Company beneficially owned by such holder and its affiliates (including,
without limitation, any convertible notes or convertible preferred stock or
warrants) subject to a limitation on conversion or exercise analogous to the
limitation contained herein. Except as set forth in the preceding
sentence, for purposes of this paragraph, beneficial ownership shall be
calculated in accordance with Section 13(d) of the Securities Exchange Act of
1934, as amended. For purposes of this Warrant, in determining the
number of outstanding shares of Common Stock, a holder may rely on the number of
outstanding shares of Common Stock as reflected in (1) the Company’s most recent
Quarterly Report on Form 10-Q, Annual Report on Form 10-K or other public filing
with the SEC, as the case may be, (2) a more recent public announcement by the
Company or (3) any other notice by the Company or its transfer agent setting
forth the number of shares of Common Stock outstanding. For any
reason at any time, upon the written or oral request of the holder of this
Warrant, the Company shall, within three (3) business days, confirm orally or in
writing to the holder of this Warrant the number of shares of Common Stock then
outstanding. In any case, the number of outstanding shares of Common
Stock shall be determined after giving effect to the conversion or exercise of
securities of the Company by the holder of this Warrant and its affiliates since
the date as of which such number of outstanding shares of Common Stock was
reported. The restriction described in this paragraph 11(a) may not
be revoked.
12. Subject
to the limitations of paragaph 11 and provided that the registration statement
for the resale of Common Stock is declared effective by US Securities and
Exchange Commission (“SEC”) pursuant to
Article II of the Registration Rights Agreement, the holder shall be
required, at the option of the Company, to exercise this Warrant (1)
on the date which is 2 years following the date the registration statement for
the resale of Common Stock is declared effective by SEC if the volume weighted
average price (“VWAP”) of the Common
Stock for the 30-day period prior to such date is equal to or more than 200% of
the Initial Exercise Price of the Warrant, or (2) on any date that the unpaid
principal amount of the Convertible Notes is US$5,000,000 or less and the VWAP
of the Common Stock for the 30-day period prior to such date is equal to or more
than 200% of the of Initial Exercise Price of the Warrant; provided that the
obligations under this paragraph 12 shall terminate upon any adjustment of the
warrant purchase price pursuant to paragaph 4.
13. All
questions concerning this Warrant will be governed and interpreted and enforced
in accordance with the internal law, not the law of conflicts, of the State of
New York. All disputes, differences, controversies and claims arising
out of or relating to this Warrant shall be resolved in accordance with Section
11.17 of the Purchase Agreement.
14. If
this Warrant is lost, stolen, mutilated or destroyed, the Company may, upon the
making of an affidavit of the fact that the person claiming the Warrant to be
lost, stolen, mutilated or destroyed and on such terms as to indemnity or
otherwise as the Company may reasonably impose (which shall, in the case of a
mutilated Warrant, include the surrender thereof), issue a new Warrant of like
denomination and tenor as the Warrant so lost, stolen, mutilated or
destroyed.
11
15. Receipt
of this Warrant by the holder hereof shall constitute acceptance of and
agreement to all of the terms and conditions contained herein.
[signature page
follows]
12
IN WITNESS WHEREOF, the Company has
caused this Warrant to be signed by its duly authorized officer and this Warrant
to be dated as of the date first written
above.
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CHINA
HOUSING & LAND
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DEVELOPMENT,
INC.
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By:
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Name:
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Title:
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[Signature
Page to Warrant]
SUBSCRIPTION
FORM
To be
Executed by the Holder of this Warrant if such Holder
Desires
to Exercise this Warrant in Whole or in Part:
To: China
Housing & Land Development, Inc. (the “Company”)
The
undersigned ___________________________________
Please
insert Social Security or other
identifying
number of Subscriber:
_______________________________
hereby
irrevocably elects to exercise the right of purchase represented by this Warrant
for, and to purchase thereunder, ___________ shares of the Common Stock (the
“Common Stock”)
provided for therein and [Circle either (a), (b) or (c)]
(a) tenders
payment herewith to the order of the Company in the amount of $___________, such
payment being made as provided on the face of this Warrant; or (b) hereby
exercises the Conversion Right as to the number of shares of Common Stock set
forth above in accordance with paragraph 10(a) of the Warrant; or (c) hereby
exercises the Alternate Conversion Right as to the number of shares of Common
Stock set forth above in accordance with paragraph 10(b) of the
Warrant.
By delivering this exercise notice,
the undersigned owner represents and warrants that it does not now, nor after
giving effect to this exercise will it, beneficially own in excess of 9.99% of
the outstanding shares of Common Stock of the Company, calculated pursuant to
the provisions of Paragraph 11 of the Warrant.
The undersigned requests that
certificates for such shares of Common Stock be issued as follows:
Name:
Address:
Deliver
to:
Address:
and, if
such number of shares of Common Stock shall not be all the shares of Common
Stock purchasable hereunder, that a new Warrant for the balance remaining of the
shares of Common Stock purchasable under this Warrant be registered in the name
of, and delivered to, the undersigned at the address stated above.
Dated:
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Signature
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Note: The
signature on this Subscription Form must correspond with the name as
written upon the face of this Warrant in every particular, without
alteration or enlargement or any change
whatever.
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FORM OF
ASSIGNMENT
(To Be
Signed Only Upon Assignment)
FOR VALUE
RECEIVED, the undersigned hereby sells, assigns and transfers unto this Warrant,
and
appoints____________________________________________________ to
transfer this Warrant on the books of the Company with the full power of
substitution in the premises.
Dated:
________________
In the
presence of:
________________________
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(Signature
must conform in all respects to the name of the holder as specified on the
face of this Warrant without alteration, enlargement or any change
whatsoever, and the signature must be guaranteed in the usual
manner)
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