This Warrant entitles the Registered Holder
thereof to purchase __ shares of Class A Common
Stock. [(i) for Warrants issued under Section
2.02(a)(i), the product of (x) 592,400 multiplied
by a fraction, the numerator of which is the
number of shares of capital stock of Moto Guzzi
Corp. owned by the Registered Holder at the
Merger Effective Time, and the denominator of
which is 7,500,000; (ii) for Warrants issued
under Section 2.02(a)(ii), 166,080; and (iii) for
Warrants issued under Section 2.02(a)(iii), the
product of (x) 41,520 multiplied by (y) a
fraction, the numerator of which is the number of
Old Moto Guzzi Warrants surrendered by the
Registered Holder at the Merger Effective Time
and the denominator of which is 1,500,000.]
No. __________
WARRANT FOR THE PURCHASE OF
SHARES OF CLASS A COMMON STOCK
OF
MOTO GUZZI CORPORATION
(A Delaware corporation)
Moto Guzzi Corporation, a Delaware corporation (the "Company"), hereby
certifies that for value received, of , or his, her or
its registered assigns (the "Registered Holder"), is entitled, subject to the
terms set forth below, to purchase from the Company, at any time or from time to
time during the period commencing on April 1, 2000 and ending at 5:00 p.m.
E.S.T. on June 30, 2001 ("Expiration Date"), shares of Class A Common
Stock, $.01 par value, of the Company ("Common Stock"), at a purchase price per
share equal to $.01 ("Purchase Price"). The number of shares of Common Stock
which may be acquired upon exercise of this Warrant, as adjusted from time to
time pursuant to the provisions of this Warrant,
is hereinafter referred to as the "Warrant Shares". All rights granted
hereunder shall expire on the Expiration Date.
1. Certain Definitions.
(a) "Actual Operating Income" shall mean the profit before
interest, taxes, minority interests, extraordinary items and the cumulative
effects of changes in accounting policies, of the Company, on a consolidated
basis, derived from the Company's audited Statements of Income/Loss for such
fiscal year, prepared in accordance with U.S. generally accepted accounting
principles consistently applied, expressed in Lire.
(b) "1999 Minimum Operating Income" shall mean Lit.
7,140,000,000.
(c) "2000 Minimum Operating Income" shall mean Lit.
8,211,000,000.
2. Condition to Exercise of Warrant. Exercise of this Warrant shall be
subject to and conditioned upon either (i) the Company's Actual Operating
Income for its 1999 fiscal year being not less than the 1999 Minimum Operating
Income, or (ii) the Company's Actual Operating Income for its 2000 fiscal year
being not less than the 2000 Minimum Operating Income.
3. Notice of Exercise.
(a) The Registered Holder hereby appoints Trident Rowan
Group, Inc. ("TRG"), with full power of substitution, as the attorney in fact
of the Registered Holder and authorizes TRG to deliver to the Company any
notice of exercise which may be given hereunder. Such authority shall be deemed
null and void if the Registered Holder delivers written notice to TRG revoking
such authority at any time prior to the date on which TRG delivers any notice
of exercise hereunder. This Warrant may be exercised by the Registered Holder,
in whole but not in part, or by TRG as agent for the Registered Holder, by the
surrender of this Warrant (with the Notice of Exercise Form
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attached hereto as Exhibit I duly executed by such Registered Holder) at the
principal office of the Company, or at such other office or agency as the
Company may designate, accompanied by payment in full, in lawful money of the
United States, of an amount equal to the then applicable Purchase Price
multiplied by the whole number of Warrant Shares which may be purchased upon
such exercise, together with any and all applicable taxes due in connection
with such exercise. This Warrant may not be exercised by, or shares of Common
Stock issued to, any Registered Holder in any state in which such exercise
would be unlawful.
(b) Each exercise of this Warrant shall be deemed to have
been effected immediately prior to the close of business on the day on which
this Warrant shall have been surrendered to the Company as provided in
subsection 3(a) above. At such time, the person or persons in whose name or
names any certificates for Warrant Shares shall be issuable upon such exercise
as provided in subsection 3(c) below shall be deemed to have become the holder
or holders of record of the Warrant Shares represented by such certificates.
(c) As soon as practicable after the exercise of the purchase
right represented by this Warrant, the Company at its expense will use its best
efforts to cause to be issued in the name of, and delivered to, the Registered
Holder, or, subject to the terms and conditions hereof, to such other
individual or entity as such Registered Holder (upon payment by such Registered
Holder of any applicable transfer taxes) may direct a certificate or
certificates for the number of full shares of Warrant Shares to which such
Registered Holder shall be entitled upon such exercise plus, in lieu of any
fractional share to which such Registered Holder would otherwise be entitled,
cash in an amount determined pursuant to Section 5 hereof.
4. Adjustments.
(a) Split, Subdivision or Combination of Shares. If the
Company, after the date on which this Warrant becomes initially exercisable and
prior to exercise, fixes a record date for the effectuation of a split or
subdivision of the outstanding shares of Common Stock or the
3
determination of holders of Common Stock entitled to receive a dividend or
other distribution payable in additional shares of Common Stock without payment
of any consideration by such holder for the additional shares of Common Stock,
then, as of such record date (or the date of such dividend distribution, split
or subdivision if no record date is fixed), the Purchase Price shall be
appropriately decreased and the number of Warrant Shares which may be acquired
hereunder shall be increased in proportion to such increase in the aggregate
number of shares of Common Stock outstanding. If the number of shares of Common
Stock outstanding at any time after the date hereof is decreased by a
combination of the outstanding shares of Common Stock or otherwise, then,
following the record date of such combination or other event, the Purchase
Price shall be appropriately increased and the number of Warrant Shares which
may be acquired hereunder shall be decreased in proportion to such decrease in
the aggregate number of shares of Common Stock outstanding.
(b) Reclassification, Reorganization, Consolidation or
Merger. In the case of any reclassification of the Common Stock (other than a
change in par value or a subdivision or combination as provided for in
subsection 4(a) above), or any reorganization, consolidation or merger of the
Company with or into another corporation (other than a merger or reorganization
with respect to which the Company is the continuing corporation and which does
not result in any reclassification of the Common Stock), or a transfer of all
or substantially all of the assets of the Company, or the payment of a
liquidating distribution then, as part of any such reorganization,
reclassification, consolidation, merger, sale or liquidating distribution,
lawful provision shall be made so that the Registered Holder of this Warrant
shall have the right thereafter to receive upon the exercise hereof (to the
extent, if any, still exercisable) the kind and amount of shares of stock or
other securities or property which such Registered Holder would have been
entitled to receive if, immediately prior to any such reorganization,
reclassification, consolidation, merger, sale or liquidating distribution, as
the case may be, such Registered Holder had held the number of shares of Common
Stock which were then purchasable upon the exercise of this Warrant or if this
Warrant shall not then be exercisable, such other consideration as the Board of
Directors of the Company shall reasonably determine to be of comparable value.
In any such case, appropriate adjustment (as reasonably determined by the Board
of Directors of the Company) shall be made in the application
4
of the provisions set forth herein with respect to the rights and interests
thereafter of the Registered Holder of this Warrant such that the provisions
set forth in this Section 4 (including provisions with respect to the Purchase
Price) shall thereafter be applicable, as nearly as is reasonably practicable,
in relation to any shares of stock or other securities or property thereafter
deliverable upon the exercise of this Warrant.
(c) Price Reduction. Notwithstanding any other provision set
forth in this Warrant, at any time and from time to time during the period that
this Warrant is exercisable the Company in it sole discretion may reduce the
Purchase Price.
(d) No Impairment. The Company will not, by amendment of its
Certificate of Incorporation or through any reorganization, recapitalization,
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 to be observed or performed hereunder by the
Company but will at all times in good faith assist in the carrying out of all
the provisions of this Section 4 and in the taking of all such actions as may
be necessary or appropriate in order to protect against impairment of the
rights of the Registered Holder of this Warrant to adjustments in the Purchase
Price.
(e) Notice of Adjustment. Upon the occurrence of each
adjustment or readjustment of the Purchase Price or the number of Warrant
Shares which may be acquired hereunder, the Company, at its expense, shall
promptly compute such adjustment or readjustment in accordance with the terms
hereof and prepare and furnish written notice thereto to the Registered Holder
of this Warrant within a reasonable amount of time from the adjustment or
readjustment stating the adjustment or readjustment and showing in reasonable
detail the facts upon which such adjustment or readjustment is based.
5
5. Notices of Record Date.
In case:
(a) the Company shall take a record of the holders of its
Common Stock (or other stock or securities at the time deliverable upon the
exercise of this Warrant) for the purpose of entitling or enabling them to
receive any dividend or other distribution (other than a dividend or
distribution payable solely in capital stock of the Company or out of funds
legally available therefor), or to receive any right to subscribe for or
purchase any shares of any class or any other securities, or to receive any
other right, or
(b) of any capital reorganization of the Company, any
reclassification of the capital stock of the Company, any consolidation or
merger of the Company with or into another corporation (other than a
consolidation or merger in which the Company is the surviving entity), or any
transfer of all or substantially all of the assets of the Company, or
(c) of the voluntary or involuntary dissolution, liquidation
or winding-up of the Company,
then, and in each such case, the Company will mail or cause to be mailed to the
Registered Holder of this Warrant a notice specifying, as the case may be, (i)
the date on which a record is to be taken for the purpose of such dividend,
distribution or right, and stating the amount and character of such dividend,
distribution or right, or (ii) the effective date on which such reorganization,
reclassification, consolidation, merger, transfer, dissolution, liquidation or
winding-up is to take place, and the time, if any is to be fixed, as of which
the holders of record of Common Stock (or such other stock or securities at the
time deliverable upon the exercise of this Warrant) shall be entitled to
exchange their shares of Common Stock (or such other stock or securities) for
securities or other property deliverable upon such reorganization,
reclassification, consolidation, merger, transfer, dissolution, liquidation or
winding-up. Such notice shall be mailed at least twenty (20) days prior
6
to the record date or effective date for the event specified in such notice,
provided that the failure to mail such notice shall not affect the legality or
validity of any such action.
6. Reservation of Stock. The Company will at all times reserve and
keep available, solely for issuance and delivery upon the exercise of this
Warrant, such shares of Warrant Shares and other stock, securities and
property, as from time to time shall be issuable upon the exercise of this
Warrant.
7. Replacement of Warrants. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and (in the case of loss, theft or destruction) upon delivery of
an indemnity agreement (with surety if reasonably required) in an amount
reasonably satisfactory to the Company, or (in the case of mutilation) upon
surrender and cancellation of this Warrant, the Company will issue, in lieu
thereof, a new Warrant of like tenor.
8. Transfer and Exchange of Warrants.
(a) The Company will maintain a register containing the names
and addresses of the Registered Holders of this Warrant. Any Registered Holder
may change its, his or her address as shown on the warrant register by written
notice to the Company requesting such change, given in accordance with Section
14 hereof.
(b) Until any transfer of this Warrant is made in the warrant
register, the Company may treat the Registered Holder of this Warrant as the
absolute owner hereof for all purposes; provided, however, that if and when
this Warrant is properly assigned in blank, the Company may (but shall not be
obligated to) treat the bearer hereof as the absolute owner hereof for all
purposes, notwithstanding any notice to the contrary.
(c) The Company shall register the transfer from time to
time, of this Warrant upon the register maintained by the Company for such
purpose, upon surrender of this Warrant for
7
transfer, upon written instructions with signatures guaranteed. Upon any such
transfer, a new Warrant representing an equal aggregate Percentage Interest
shall be issued and this Warrant shall be canceled.
(d) This Warrant may be surrendered to the Company, together
with a written request for exchange, and thereupon the Company shall issue in
exchange therefor one or more new Warrants as requested by the Registered
Holder of this Warrant, representing in the aggregate an equal Percentage
Interest; provided, however, that in the event that this Warrant bears a
restrictive legend, the Company shall not cancel this Warrant nor issue a new
Warrant in exchange therefor unless the Company has received an opinion of
counsel stating that such transfer may be made and indicating whether the new
Warrant(s) must also bear a restrictive legend.
9. No Rights as Shareholder. Until the exercise of this Warrant, the
Registered Holder of this Warrant shall not have or exercise any rights by
virtue hereof as a shareholder of the Company.
10. Change or Waiver. Any term of this Warrant may be changed or
waived only by an instrument in writing signed by the party against which
enforcement of the change or waiver is sought.
11. Headings. The headings in this Warrant are for purposes of
reference only and shall not limit or otherwise affect the meaning of any
provision of this Warrant.
12. Governing Law. This Warrant shall be governed by and construed in
accordance with the laws of the State of New York as such laws are applied to
contracts made and to be fully performed entirely within that state between
residents of that state.
13. Jurisdiction and Venue. The Company (i) agrees that any legal
suit, action or proceeding arising out of or relating to this Warrant shall be
instituted exclusively in New York State
8
Supreme Court, County of New York or in the United States District Court for
the Southern District of New York, (ii) waives any objection to the venue of
any such suit, action or proceeding and the right to assert that such forum is
not a convenient forum, and (iii) irrevocably consents to the jurisdiction of
the New York State Supreme Court, County of New York, and the United States
District Court for the Southern District of New York in any such suit, action
or proceeding, and the Company further agrees to accept and acknowledge service
or any and all process which may be served in any such suit, action or
proceeding in New York State Supreme Court, County of New York or in the United
States District Court for the Southern District of New York and agrees that
service of process upon it mailed by certified mail to its address shall be
deemed in every respect effective service of process upon it in any suit,
action or proceeding.
14. Mailing of Notices. etc. All notices and other communications
under this Warrant (except payment) shall be in writing and shall be
sufficiently given if delivered to the addressees in person, by Federal Express
or similar receipt delivery, by facsimile delivery or, if mailed, postage
prepaid, by certified mail, return receipt requested, as follows:
Registered Holder: To his or her address on page 1 of
this Warrant.
The Company: Moto Guzzi Corporation
c/o Trident Rowan Group, Inc.
Two Worlds Fair Drive
Franklin Township
Somerset, NJ 08873
Attn: Mr. Mark S. Hauser, President
Fax: (732) 868-0193
In either case, with a copy to:
Morrison Cohen Singer & Weinstein, LLP
750 Lexington Avenue
New York, NY 10022
Attn: David Lerner, Esq.
Fax: (212) 735-8708
or to such other address as any of them, by notice to the others may designate
from time to time. Time shall be counted to, or from, as the case may be, the
delivery in person or by mailing.
9
MOTO GUZZI CORPORATION
By:
--------------------------------------
Print Name:
------------------------------
Title:
-----------------------------------
10
EXHIBIT I
NOTICE OF EXERCISE
------------------
To: Moto Guzzi Corporation
c/o Trident Rowan Group, Inc.
Two Worlds Fair Drive
Franklin Township
Somerset, NJ 08873
1. The undersigned hereby elects to purchase such number of shares of
the Common Stock of Moto Guzzi Corporation, pursuant to the terms of the
attached Warrant, as equals the undersigned's entire interest in this Warrant,
and tenders herewith payment of the purchase price of such shares in full,
together with all applicable transfer taxes, if any.
2. Please issue a certificate or certificates representing said shares
of the Common Stock in the name of the undersigned or in such other name as is
specified below:
-------------------------------------------
(Name)
-------------------------------------------
(Address)
-------------------------------------------
-------------------------------------------
-------------------------------------------
(Taxpayer Identification Number)
- -----------------------------------
[print name of Registered Holder]
By:
--------------------------------
Title:
-----------------------------
Date:
------------------------------
11