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EXHIBIT 10.8
THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE OFFERED FOR SALE, SOLD
OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
FILED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER SUCH ACT.
VOID AFTER 5:00 P.M., NEW YORK TIME, ON MARCH 10, 2003 OR IF NOT A BUSINESS DAY,
AS DEFINED HEREIN, AT 5:00 P.M., NEW YORK TIME, ON THE NEXT FOLLOWING BUSINESS
DAY.
WARRANT TO PURCHASE
31,732 SHARES OF COMMON STOCK
NO. 2
WARRANT TO PURCHASE
COMMON STOCK
OF
BNC MORTGAGE, INC.
TRANSFER RESTRICTED -- SEE SECTION 5.02
This certifies that, for good and valuable consideration, Piper Jaffray
Inc., and its registered, permitted assigns (collectively, the "Warrantholder"),
is entitled to purchase from BNC Mortgage, Inc., a Delaware corporation (the
"Company"), subject to the terms and conditions hereof, at any time on or after
9:00 A.M., New York time, on March 10, 1999, and before 5:00 P.M., New York
time, on March 10, 2003 (or, if such day is not a Business Day, at or before
5:00 P.M., New York time, on the next following Business Day), the number of
fully paid and non-assessable shares of Common Stock stated above at the
Exercise Price. The Exercise Price and the number of shares purchasable
hereunder are subject to adjustment from time to time as provided in Article III
hereof.
ARTICLE I
SECTION 1.01: DEFINITION OF TERMS. As used in this Warrant, the
following capitalized terms shall have the following respective meanings:
(a) Business Day: A day other than a Saturday, Sunday or other
day on which banks in the State of New York are authorized by law to
remain closed.
(b) Common Stock: Common Stock, $.001 par value per share, of
the Company.
(c) Common Stock Equivalents: Securities that are convertible
into or exercisable for shares of Common Stock.
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(d) Demand Registration: See Section 6.02.
(e) Exchange Act: The Securities Exchange Act of 1934, as
amended from time to time.
(f) Exercise Price: $10.45 per Warrant Share, as such price may
be adjusted from time to time pursuant to Article III hereof.
(g) Expiration Date: 5:00 P.M., New York time, on March 10, 2003
or if such day is not a Business Day, the next succeeding day which is a
Business Day.
(h) 25% Holders: At any time as to which a Demand Registration
is requested, the Holder and/or the holders of any other Warrants and/or
the holders of Warrant Shares who have the right to acquire or hold, as
the case may be, not less than 25% of the combined total of Warrant
Shares issuable and Warrant Shares outstanding at the time such Demand
Registration is requested.
(i) Holder: A Holder of Registrable Securities.
(j) NASD: National Association of Securities Dealers, Inc.; and
NASDAQ: NASD Automatic Quotation System.
(k) Person: An individual, partnership, joint venture,
corporation, trust, unincorporated organization or government or any
department or agency thereof.
(l) Piggyback Registration: See Section 6.01.
(m) Prospectus: Any prospectus included in any Registration
Statement, as amended or supplemented by any prospectus supplement, with
respect to the terms of the offering of any portion of the Registrable
Securities covered by such Registration Statement and all other
amendments and supplements to the Prospectus, including post-effective
amendments and all material incorporated by reference in such
Prospectus.
(n) Public Offerings: A public offering of any of the Company's
equity or debt securities pursuant to a registration statement under the
Securities Act.
(o) Registration Expenses: Any and all expenses incurred in
connection with any registration or action incident to performance of or
compliance by the Company with Article VI, including, without
limitation, (i) all SEC, national securities exchange and NASD
registration and filing fees; all listing fees and all transfer agent
fees; (ii) all fees and expenses of complying with state securities or
blue sky laws (including the fees and disbursements of counsel for the
underwriters in connection with blue sky qualifications of the
Registrable Securities; (iii) all printing, mailing, messenger and
delivery expenses and (iv) all fees and disbursements of counsel for the
Company and of its accountants, including the expenses of any special
audits and/or "cold comfort" letters required by or incident to such
performance and compliance, but excluding underwriting discounts and
commissions,
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brokerage fees and transfer taxes, if any, and fees of counsel or
accountants retained by the holders of Registrable Securities to advise
them in their capacity as Holders of Registrable Securities.
(p) Registrable Securities: Any Warrant Shares issued to Piper
Jaffray Inc and CIBC Oppenheimer Corp. and/or their designees or
transferees as permitted under Section 5.02 and/or other securities that
may be or are issued by the Company upon exercise of this Warrant,
including those which may thereafter be issued by the Company in respect
of any such securities by means of any stock splits, stock dividends,
recapitalizations, reclassifications or the like, and as adjusted
pursuant to Article III hereof.
(q) Registration Statement: Any registration statement of the
Company filed or to be filed with the SEC which covers any of the
Registrable Securities pursuant to the provisions of this Agreement,
including all amendments (including post-effective amendments) and
supplements thereto, all exhibits thereto and all material incorporated
therein by reference.
(r) SEC: The Securities and Exchange Commission or any other
federal agency at the time administering the Securities Act or the
Exchange Act.
(s) Securities Act: The Securities Act of 1933, as amended from
time to time.
(t) Transfer: See Section 5.02.
(u) Warrants: This Warrant, all other warrants issued on the
date hereof and all other warrants that may be issued in its or their
place (together evidencing the right to purchase an aggregate of 317,319
shares of Common Stock), originally issued as set forth in the
definition of Registrable Securities.
(v) Warrantholder: The person(s) or entity(ies) to whom this
Warrant is originally issued, or any successor in interest thereto, or
any assignee or transferee thereof, in whose name this Warrant is
registered upon the books to be maintained by the Company for that
purpose.
(w) Warrant Shares: Common Stock, Common Stock Equivalents and
other securities purchased or purchasable upon exercise of the Warrants.
ARTICLE II
DURATION AND EXERCISE OF WARRANT
SECTION 2.01: DURATION OF WARRANT. Subject to the limitations specified
in Section 2.02.(a)(ii) regarding a Cashless Exercise, the Warrantholder may
exercise this Warrant at any time and from time to time after 9:00 A.M., New
York time, on March 10, 1999, and before 5:00 P.M., New York time, on the
Expiration Date. If this Warrant is not exercised on or prior to the Expiration
Date, it shall become void, and all rights hereunder shall thereupon cease.
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SECTION 2.02: EXERCISE OF WARRANT.
(a) The Warrantholder may exercise this Warrant, in whole or in
part, as follows:
(i) By presentation and surrender of this Warrant to the
Company at its principal executive offices or at the office of
its stock transfer agent, if any, with the Subscription Form
annexed hereto duly executed and accompanied by payment of the
full Exercise Price for each Warrant Share to be purchased; or
(ii) By presentation and surrender of this Warrant to
the Company at its principal executive offices with a Cashless
Exercise Form annexed hereto duly executed (a "Cashless
Exercise"). In the event of a Cashless Exercise, the
Warrantholder shall exchange its warrant for that number of
shares of Common Stock determined by multiplying the number of
Warrant Shares by a fraction, the numerator of which shall be
the amount by which the then current market price per share of
Common Stock exceeds the Exercise Price, and the denominator of
which shall be the then current market price per share of Common
Stock. For purposes of any computation under this Section
2.02(a)(ii), the then current market price per share of Common
Stock at any date shall be deemed to be the average of the daily
closing prices for 20 consecutive trading days commencing 30
trading days before such date. The closing price for each day
shall be the last sale price regular way or, in case no such
reported sales take place on such day, the average of the last
reported bid and asked prices regular way, in either case on the
principal national securities exchange on which the Common Stock
is admitted to trading or listed, or if not listed or admitted
to trading on any such exchange, the representative closing bid
price as reported by NASDAQ, or other similar organization if
NASDAQ is no longer reporting such information, or if not so
available, the fair market price as determined by the Board of
Directors of the Company.
(b) Upon receipt of this Warrant, in the case of Section 2.02
(a)(i), with the Subscription Form duly executed and accompanied by
payment of the aggregate Exercise Price for the Warrant Shares for which
this Warrant is then being exercised, or, in the case of Section 2.02
(a)(ii), with the Cashless Exercise Form duly executed, the Company
shall cause to be issued certificates for the total number of whole
shares of Common Stock for which this Warrant is being exercised
(adjusted to reflect the effect of the anti-dilution provisions
contained in Article III hereof, if any, and as provided in Section 2.04
hereof) in such denominations as are requested for delivery to the
Warrantholder, and the Company shall thereupon deliver such certificates
to the Warrantholder. The Warrantholder shall be deemed to be the holder
of record of the shares of Common Stock issuable upon such exercise,
notwithstanding that the stock transfer books of the Company shall then
be closed or that certificates representing such shares of Common Stock
shall not then be actually delivered to the Warrantholder. If at the
time this Warrant is exercised, a Registration Statement is not in
effect to register under the Securities Act the issuance of the Warrant
Shares upon exercise of this Warrant, the Company may require the
Warrantholder to make such representations, and may place such legends
on certificates representing the Warrant
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Shares, as may be reasonably required in the opinion of counsel to the
Company to permit the Warrant Shares to be issued without such
registration.
(c) In case the Warrantholder shall exercise this Warrant with
respect to less than all of the Warrant Shares that may be purchased
under this Warrant, the Company shall execute a new warrant in the form
of this Warrant for the balance of such Warrant Shares and deliver such
new warrant to the Warrantholder.
(d) The Company shall pay any and all stock transfer and similar
taxes which may be payable in respect of the issue of this Warrant or in
respect of the issue of any Warrant Shares; provided, however, that the
Company shall not be required to pay any tax which may be payable in
respect of any transfer of this Warrant, or the Warrant Shares, by any
Warrantholder.
SECTION 2.03: RESERVATION OF SHARES. The Company hereby agrees that at
all times there shall be reserved for issuance and delivery upon exercise of
this Warrant such number of shares of Common Stock or other shares of capital
stock of the Company from time to time issuable upon exercise of this Warrant.
All such shares shall be duly authorized, and when issued upon such exercise,
shall be validly issued, fully paid and nonassessable, free and clear of all
liens, security interests, charges and other encumbrances or restrictions on
sale and free and clear of all preemptive rights (except the restrictions
imposed by the legend appearing at the top of Page 1 of this Warrant).
SECTION 2.04: FRACTIONAL SHARES. The Company shall not be required to
issue any fraction of a share of its capital stock in connection with the
exercise of this Warrant, and in any case where the Warrantholder would, except
for the provisions of this Section 2.04, be entitled under the terms of this
Warrant to receive a fraction of a share upon the exercise of this Warrant, the
Company shall, upon the exercise of this Warrant and tender of the Exercise
Price (as adjusted to cover the balance of the share), issue the larger number
of whole shares purchasable upon exercise of this Warrant. The Company shall not
be required to make any cash or other adjustment in respect of such fraction of
a share to which the Warrantholder would otherwise be entitled.
SECTION 2.05: LISTING. Prior to the issuance of any shares of Common
Stock upon exercise of this Warrant, the Company shall secure the listing of
such shares of Common Stock upon each national securities exchange or automated
quotation system, if any, upon which shares of Common Stock are then listed
(subject to official notice of issuance upon exercise of this Warrant) and shall
maintain, so long as any other shares of Common Stock shall so be listed, such
listing of all shares of Common Stock from time to time issuable upon the
exercise of this Warrant; and the Company shall so list on each national
securities exchange or automated quotation system, and shall maintain such
listing of, any other shares of capital stock of the Company issuable upon the
exercise of this Warrant if and so long as any shares of the same class shall be
listed on such national securities exchange or automated quotation system.
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ARTICLE III
ADJUSTMENT OF SHARES OF COMMON STOCK PURCHASABLE AND OF EXERCISE PRICE
The Exercise Price and the number and kind of Warrant Shares shall be
subject to adjustment from time to time upon the happening of certain events as
provided in this Article III.
SECTION 3.01: MECHANICAL ADJUSTMENTS.
(a) If at any time prior to the exercise of this Warrant in
full, the Company shall (i) declare a dividend or make a distribution on
the Common Stock payable in shares of its capital stock (whether shares
of Common Stock or of capital stock of any other class); (ii) subdivide,
reclassify or recapitalize outstanding Common Stock into a greater
number of shares; (iii) combine, reclassify or recapitalize its
outstanding Common Stock into a smaller number of shares; or (iv) issue
any shares of its capital stock by reclassification of its Common Stock
(including any such reclassification in connection with a consolidation
or a merger in which the Company is the continuing corporation), the
Exercise Price in effect at the time of the record date of such
dividend, distribution, subdivision, combination, reclassification or
recapitalization shall be adjusted so that the Warrantholder shall be
entitled to receive the aggregate number and kind of shares which, if
this Warrant had been exercised in full immediately prior to such event,
it would have owned upon such exercise and been entitled to receive by
virtue of such dividend, distribution, subdivision, combination,
reclassification or recapitalization. Any adjustment required by this
paragraph 3.01(a) shall be made successively immediately after the
record date, in the case of a dividend or distribution, or the effective
date, in the case of a subdivision, combination, reclassification or
recapitalization, to allow the purchase of such aggregate number and
kind of shares.
(b) If at any time prior to the exercise of this Warrant in
full, the Company shall fix a record date for the issuance or making a
distribution to all holders of Common Stock (including any such
distribution to be made in connection with a consolidation or merger in
which the Company is to be the continuing corporation) of evidences of
its indebtedness, any other securities of the Company or any cash,
property or other assets (excluding a combination, reclassification or
recapitalization referred to in Section 3.01(a), regular cash dividends
or cash distributions paid out of net profits legally available therefor
and in the ordinary course of business and subscription rights, options
or warrants for Common Stock or Common Stock Equivalents (any such
nonexcluded event being herein called a "Special Dividend"), (i) the
Exercise Price shall be decreased immediately after the record date for
such Special Dividend to a price determined by multiplying the Exercise
Price then in effect by a fraction, the numerator of which shall be the
then current market price of the Common Stock (as defined in Section
3.01(e)) on such record date less the fair market value (as determined
by the Company's Board of Directors) of the evidences of indebtedness,
securities or property, or other assets issued or distributed in such
Special Dividend applicable to one share of Common Stock or of such
subscription rights, options or warrants applicable to one share of
Common Stock and the denominator of which shall be such then
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current market price per share of Common Stock (as so determined) and
(ii) the number of shares of Common Stock subject to purchase upon
exercise of this Warrant shall be increased to a number determined by
multiplying the number of shares of Common Stock subject to purchase
immediately before such Special Dividend by a fraction, the numerator of
which shall be the Exercise Price in effect immediately before such
Special Dividend and the denominator of which shall be the Exercise
Price in effect immediately after such Special Dividend. Any adjustment
required by this paragraph 3.01(b) shall be made successively whenever
such a record date is fixed and in the event that such distribution is
not so made, the Exercise Price shall again be adjusted to be the
Exercise Price that was in effect immediately prior to such record date.
(c) If at any time prior to the exercise of this Warrant in
full, the Company shall make a distribution to all holders of the Common
Stock of stock of a subsidiary or securities convertible into or
exercisable for such stock, then in lieu of an adjustment in the
Exercise Price or the number of Warrant Shares purchasable upon the
exercise of this warrant, each Warrantholder, upon the exercise hereof
at any time after such distribution, shall be entitled to receive from
the Company, such subsidiary or both, as the Company shall determine,
the stock or other securities to which such Warrantholder would have
been entitled if such Warrantholder had exercised this Warrant
immediately prior thereto, all subject to further adjustment as provided
in this Article III, and the Company shall reserve, for the life of the
Warrant, such securities of such subsidiary or other corporation;
provided, however, that no adjustment in respect of dividends or
interest on such stock or other securities shall be made during the term
of this Warrant or upon its exercise.
(d) Whenever the Exercise Price payable upon exercise of each
Warrant is adjusted pursuant to one or more of paragraphs (a) and (b) of
this Section 3.01, the Warrant Shares shall simultaneously be adjusted
by multiplying the number of Warrant Shares initially issuable upon
exercise of each Warrant by the Exercise Price in effect on the date of
such adjustment and dividing the product so obtained by the Exercise
Price, as adjusted.
(e) For the purpose of any computation under this Section 3.01,
the current market price per share of Common Stock at any date shall be
deemed to be the average of the daily closing prices for 20 consecutive
trading days commencing 30 trading days before such date. The closing
price for each day shall be the last sale price regular way or, in case
no such reported sales take place on such day, the average of the last
reported bid and asked prices regular way, in either case on the
principal national securities exchange on which the Common Stock is
admitted to trading or listed, or if not listed or admitted to trading
on any such exchange, the representative closing bid price as reported
by NASDAQ, or other similar organization if NASDAQ is no longer
reporting such information, or if not so available, the fair market
price as determined by the Board of Directors of the Company.
(f) No adjustment in the Exercise Price shall be required unless
such adjustment would require an increase or decrease of at least ten
cents ($.10) in such price; provided, however, that any adjustments
which by reason of this paragraph (f) are not required to be made shall
be carried forward and taken into account in any subsequent adjustment.
All calculations under this Section 3.01 shall be made to the nearest
cent or to the nearest one-
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hundredth of a share, as the case may be. Notwithstanding anything in
this Section 3.01 to the contrary, the Exercise Price shall not be
reduced to less than the then existing par value of the Common Stock as
a result of any adjustment made hereunder.
(h) In the event that at any time, as a result of any adjustment
made pursuant to Section 3.01(a), the Warrantholder thereafter shall
become entitled to receive any shares of the Company other than Common
Stock, thereafter the number of such other shares so receivable upon
exercise of any Warrant shall be subject to adjustment from time to time
in a manner and on terms as nearly equivalent as practicable to the
provisions with respect to the Common Stock contained in Section
3.01(a).
SECTION 3.02: NOTICE OF ADJUSTMENT. Whenever the number of Warrant
Shares or the Exercise Price is adjusted as herein provided, the Company shall
prepare and deliver forthwith to the Warrantholder a certificate signed by its
President, and by any Vice President, Treasurer or Secretary, setting forth the
adjusted number of shares purchasable upon the exercise of this Warrant and the
Exercise Price of such shares after such adjustment, a brief statement of the
facts requiring such adjustment and the computation by which adjustment was
made.
SECTION 3.03: NO ADJUSTMENT FOR DIVIDENDS. Except as provided in Section
3.01 of this Agreement, no adjustment in respect of any cash dividends paid by
the Company shall be made during the term of this Warrant or upon the exercise
of this Warrant.
SECTION 3.04: PRESERVATION OF PURCHASE RIGHTS IN CERTAIN TRANSACTIONS.
In case of any reclassification, capital reorganization or other change of
outstanding shares of Common Stock (other than a subdivision or a combination of
the outstanding Common Stock and other than a change in the par value of the
Common Stock or in case of any consolidation or merger of the Company with or
into another corporation (other than a merger with a subsidiary in which the
Company is the continuing corporation and said merger does not result in any
reclassification, capital reorganization or other change of outstanding shares
of Common Stock of the class issuable upon exercise of this Warrant)) or in case
of any sale, lease, transfer or conveyance to another corporation of the
property and assets of the Company as an entirety or substantially as an
entirety, the Company shall, as a condition precedent to such transaction, cause
such successor or purchasing corporation, as the case may be, to execute with
the Warrantholder an agreement granting the Warrantholder the right thereafter,
upon payment of the Exercise Price in effect immediately prior to such action,
to receive upon exercise of this Warrant the kind and amount of shares and other
securities and property which he would have owned or have been entitled to
receive after the happening of such reclassification, change, consolidation,
merger, sale or conveyance had this Warrant been exercised immediately prior to
such action. Such agreement shall provide for adjustments in respect of such
shares of stock and other securities and property, which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Article
III. In the event that in connection with any such reclassification, capital
reorganization, change, consolidation, merger, sale or conveyance, additional
shares of Common Stock shall be issued in exchange, conversion, substitution or
payment, in whole or in part, for, or of, a security of the Company other than
Common Stock, any such issue shall be treated as an issue of Common Stock
covered by the provisions of Article III. The provisions of this Section 3.04
shall similarly apply to successive reclassification, capital reorganizations,
consolidations, mergers, sales or conveyances.
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SECTION 3.05: FORM OF WARRANT AFTER ADJUSTMENTS. The form of this
Warrant need not be changed because of any adjustments in the Exercise Price or
the number or kind of the Warrant Shares, and Warrants theretofore or thereafter
issued may continue to express the same price and number and kind of shares as
are stated in this Warrant, as initially issued.
SECTION 3.06: TREATMENT OF WARRANTHOLDER. Prior to due presentment for
registration of transfer of this Warrant, the Company may deem and treat the
Warrantholder as the absolute owner of this Warrant (notwithstanding any
notation of ownership or other writing hereon) for all purposes and shall not be
affected by any notice to the contrary.
ARTICLE IV
OTHER PROVISIONS RELATING TO RIGHTS OF WARRANTHOLDER
SECTION 4.01: NO RIGHTS AS SHAREHOLDERS; NOTICE TO WARRANTHOLDERS.
Nothing contained in this Warrant shall be construed as conferring upon the
Warrantholder or his or its transferees the right to vote or to receive
dividends or to consent to or receive notice as a shareholder in respect of any
meeting of shareholders for the election of directors of the Company or any
other matter, or any other rights whatsoever as shareholders of the Company. The
Company shall give notice to the Warrantholder by registered mail if at any time
prior to the expiration or exercise in full of the Warrants, any of the
following events shall occur:
(a) the Company shall authorize the payment of any dividend upon
shares of Common Stock payable in any securities or authorize the making
of any distribution (other than a cash dividend subject to the
parenthetical set forth in Section 3.01(b)) to all holders of Common
Stock;
(b) the Company shall authorize the issuance to all holders of
Common Stock of any additional shares of Common Stock or Common Stock
Equivalents or of rights, options or warrants to subscribe for or
purchase Common Stock or Common Stock Equivalents or of any other
subscription rights, options or warrants;
(c) a dissolution, liquidation or winding up of the Company
(other than in connection with a consolidation, merger, or sale or
conveyance of the property of the Company as an entirety or
substantially as an entirety); or
(d) a capital reorganization or reclassification of the Common
Stock (other than a subdivision or combination of the outstanding Common
Stock and other than a change in the par value of the Common Stock) or
any consolidation or merger 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 change of Common Stock outstanding) or in the case
of any sale or conveyance to another corporation of the property of the
Company as an entirety or substantially as an entirety.
Such giving of notice shall be initiated (i) at least 10 Business Days
prior to the date fixed as a record date or effective date or the date of
closing of the Company's stock transfer books for the
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determination of the shareholders entitled to such dividend, distribution or
subscription rights, or for the determination of the shareholders entitled to
vote on such proposed merger, consolidation, sale, conveyance, dissolution,
liquidation or winding up. Such notice shall specify such record date or the
date of closing the stock transfer books, as the case may be. Failure to provide
such notice shall not affect the validity of any action taken in connection with
such dividend, distribution or subscription rights, or proposed merger,
consolidation, sale, conveyance, dissolution, liquidation or winding up.
SECTION 4.02: LOST, STOLEN, MUTILATED OR DESTROYED WARRANTS. If this
Warrant is lost, stolen, mutilated or destroyed, the Company may, on such terms
as to indemnity or otherwise as it may in its discretion impose (which shall, in
the case of a mutilated Warrant, include the surrender thereof), issue a new
Warrant of like denomination and tenor as and in substitution for this Warrant.
ARTICLE V
SPLIT-UP, COMBINATION EXCHANGE AND TRANSFER OF WARRANTS
SECTION 5.01: SPLIT-UP, COMBINATION, EXCHANGE AND TRANSFER OF WARRANTS.
Subject to the provisions of Section 5.02 hereof, this Warrant may be split up,
combined or exchanged for another Warrant or Warrants containing the same terms
to purchase a like aggregate number of Warrant Shares. If the Warrantholder
desires to split up, combine or exchange Warrants, he or it shall make such
request in writing delivered to the Company and shall surrender to the Company
any Warrants to be so split up, combined or exchanged. Upon any such surrender
for a split up, combination or exchange, the Company shall execute and deliver
to the person entitled thereto a Warrant or Warrants, as the case may be, as so
requested. The Company shall not be required to effect any split up, combination
or exchange which will result in the issuance of a Warrant entitling the
Warrantholder to purchase upon exercise a fraction of a share of Common Stock or
a fractional Warrant. The Company may require such Warrantholder to pay a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any split up, combination or exchange of Warrants.
SECTION 5.02: RESTRICTIONS ON TRANSFER. Neither this Warrant nor the
Warrant Shares may be disposed of or encumbered (any such action, a "Transfer"),
except (i) to Piper Jaffray Inc., any successor to the business of such company,
or any officer of such company, or (ii) to any underwriter in connection with a
Public Offering of the Common Stock, provided (as to (ii)) that this Warrant is
exercised upon such Transfer and the shares of Common Stock issued upon such
exercise are sold by such underwriter as part of such Public Offering and, as to
both (i) and (ii), only in accordance with and subject to the provisions of the
Securities Act and the rules and regulations promulgated thereunder. If at the
time of a Transfer, a Registration Statement is not in effect to register this
Warrant or the Warrant Shares, the Company may require the Warrantholder to make
such representations, and may place such legends on certificates representing
this Warrant, as may be reasonably required in the opinion of counsel to the
Company to permit a Transfer without such registration.
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ARTICLE VI
REGISTRATION UNDER THE SECURITIES ACT OF 1933
SECTION 6.01: PIGGYBACK REGISTRATION.
(a) Right to Include Registrable Securities. If at any time or
from time to time after March 10, 1999 and prior to the Expiration Date,
the Company proposes to register any of its securities under the
Securities Act on any form for the registration of securities under such
Act, whether or not for its own account (other than by a registration
statement on Form S-8 or other form which does not include substantially
the same information as would be required in a form for the general
registration of securities or would not be available for the Registrable
Securities) (a "Piggyback Registration"), it shall as expeditiously as
possible give written notice to all Holders of its intention to do so
and of such Holders' rights under this Section 6.01. Such rights are
referred to hereinafter as "Piggyback Registration Rights." Upon the
written request of any such Holder made within 20 days after receipt of
any such notice (which request shall specify the Registrable Securities
intended to be disposed of by such Holder), the Company shall include in
the Registration Statement the Registrable Securities which the Company
has been so requested to register by the Holders thereof and the Company
shall keep such registration statement in effect and maintain compliance
with each Federal and state law or regulation for the period necessary
for such Holder to effect the proposed sale or other disposition (but in
no event for a period greater than 120 days).
(b) Withdrawal of Piggyback Registration by Company. If, at any
time after giving written notice of its intention to register any
securities in a Piggyback Registration but prior to the effective date
of the related Registration Statement, the Company shall determine for
any reason not to register such securities, the Company shall give
written notice of such determination to each Holder and, thereupon,
shall be relieved of its obligation to register any Registrable
Securities in connection with such Piggyback Registration. All best
efforts obligations of the Company pursuant to Section 6.04 shall cease
if the Company determines to terminate prior to such effective date any
registration where Registrable Securities are being registered pursuant
to this Section 6.01.
(c) Piggyback Registration of Underwritten Public Offerings. If
a Piggyback Registration involves an offering by or through
underwriters, then, (i) all Holders requesting to have their Registrable
Securities included in the Company's Registration Statement must sell
their Registrable Securities to the underwriters selected by the Company
on the same terms and conditions as apply to other selling shareholders
and (ii) any Holder requesting to have his or its Registrable Securities
included in such Registration Statement may elect in writing, not later
than three Business Days prior to the effectiveness of the Registration
Statement filed in connection with such registration, not to have his or
its Registrable Securities so included in connection with such
registration.
(d) Payment of Registration Expenses for Piggyback Registration.
The Company shall pay all Registration Expenses in connection with each
registration of Registrable
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Securities requested pursuant to a Piggyback Registration Right
contained in this Section 6.01.
(e) Priority in Piggyback Registration. If a Piggyback
Registration involves an offering by or through underwriters, the
Company shall not be required to include Registrable Shares therein if
and to the extent the underwriter managing the offering reasonably
believes in good faith and advises each Holder requesting to have
Registrable Securities included in the Company's Registration Statement
that such inclusion would materially adversely affect such offering;
provided that (i) any such reduction or elimination shall be pro rata to
all other holders of the securities of the Company exercising "piggyback
registration rights" similar to those set forth herein and to any
selling shareholders who are employees, officers, directors or other
affiliates of the Company, in each case in proportion to the respective
number of shares they have requested to be registered, and (ii) in such
event, such Holders may delay any offering by them of all Registrable
Shares requested to be included (or that portion of such Registrable
Shares eliminated for such period, not to exceed 90 days, as the
managing underwriter shall request) and the Company shall file such
supplements and post-effective amendments and take such other action
necessary under Federal and state law or regulation as may be necessary
to permit such Holders to make their proposed offering for a period of
90 days following such period of delay.
SECTION 6.02: DEMAND REGISTRATION.
(a) Request for Registration. If, at any time subsequent to
March 10, 1999 and prior to the Expiration Date, any 25% Holders request
that the Company file a registration statement under the Securities Act,
the Company as soon as practicable shall use its best efforts to file a
registration statement with respect to all Warrant Shares that it has
been so requested to include and obtain the effectiveness thereof, and
to take all other action necessary under any Federal or state law or
regulation to permit the Warrant Shares that are then held and/or that
may be acquired upon the exercise of the Warrants specified in the
notices of the Holders or holders thereof to be sold or otherwise
disposed of, and the Company shall maintain such compliance with each
such Federal and state law and regulation for the period necessary for
such Holders or holders to effect the proposed sale or other disposition
(but in no event for more than 120 days); provided, however, the Company
shall be entitled, no more than once during such period, to defer such
registration for a period of up to 60 days if and to the extent that its
Board of Directors shall determine that such registration would
interfere with a pending corporate transaction or would require the
disclosure, pursuant to such registration, of material information,
which disclosure has been determined, by the Board of Directors of the
Company in good faith, to be not in the best interests of the Company
(any cash request being a "Demand Registration"). The Company shall also
promptly give written notice to the Holder and the holders of any other
Warrants and/or the holders of any Warrant Shares who or that have not
made a request to the Company pursuant to the provisions of this
subsection (a) of its intention to effect any required registration or
qualification and shall use its best efforts to effect as expeditiously
as possible such registration or qualification of all other such Warrant
Shares that are then held and/or that may be acquired upon the exercise
of the Warrants, the Holder or holders
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of which have requested such registration or qualification, within 15
days after such notice has been given by the Company, as provided in the
preceding sentence. The Company shall be required to effect a
registration or qualification pursuant to this subsection (a) on one
occasion only.
(b) Payment of Registration Expenses for Demand Registration.
The Company shall pay all Registration Expenses in connection with the
Demand Registration.
SECTION 6.03: BUY-OUTS OF REGISTRATION DEMAND. In lieu of carrying out
its obligations to effect a Piggyback Registration or Demand Registration of any
Registrable Securities pursuant to this Article VI, the Company may carry out
such obligation by offering to purchase and purchasing such Registrable
Securities requested to be registered at an amount in cash equal to the
difference between (a) the last sale price of the Common Stock on the day the
request for registration is made and (b) the Exercise Price in effect on such
day.
SECTION 6.04: REGISTRATION PROCEDURES. If and whenever the Company is
required to use its best efforts to take action pursuant to any Federal or state
law or regulation to permit the sale or other disposition of any Warrant Shares
that are then held or that may be acquired upon exercise of the Warrants, in
order to effect or cause the registration of any Registrable Securities under
the Securities Act as provided in this Article VI, the Company shall, as
expeditiously as practicable:
(a) furnish to each selling Holder of Registrable Securities and
the underwriters, if any, without charge, as many copies of the
Registration Statement, the Prospectus or the Prospectuses (including
each preliminary prospectus) and any amendment or supplement thereto as
they may reasonably request;
(b) enter into such agreements (including an underwriting
agreement) and take all such other actions reasonably required in
connection therewith in order to expedite or facilitate the disposition
of such Registrable Securities and in such connection, if the
registration is in connection with an underwritten offering (i) make
such representations and warranties to the underwriters in such form,
substance and scope as are customarily made by issuers to underwriters
in underwritten offerings and confirm the same if and when requested;
(ii) obtain opinions of counsel to the Company and updates thereof
(which counsel and opinions in form, scope and substance shall be
reasonably satisfactory to the underwriters) addressed to the
underwriters and the Holders covering the matters customarily covered in
opinions requested in underwritten offerings and such other matters as
may be reasonably requested by such underwriters; (iii) obtain "cold
comfort" letters and updates thereof from the Company's accountants
addressed to the underwriters such letters to be in customary form and
to cover matters of the type customarily covered in "cold comfort"
letters to underwriters and the Holders in connection with underwritten
offerings; (iv) set forth in full, in any underwriting agreement entered
into, the indemnification provisions and procedures of Section 6.05
hereof with respect to all parties to be indemnified pursuant to said
Section; and (v) deliver such documents and certificates as may be
reasonably requested by the underwriters to evidence compliance with
clause (i) above and with any customary conditions contained in the
underwriting agreement or other agreement entered into by the
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Company; the above shall be done at each closing under such underwriting
or similar agreement or as and to the extent required thereunder;
(c) make available for inspection by one or more representatives
of the Holders of Registrable Securities being sold, any underwriter
participating in any disposition pursuant to such registration, and any
attorney or accountant retained by such Holders or underwriter, all
financial and other records, pertinent corporate documents and
properties of the Company, and cause the Company's officers, directors
and employees to supply all information reasonably requested by any such
representatives in connection with such;
(d) otherwise use its best efforts to comply with all applicable
Federal and state regulations; and take such other action as may be
reasonably necessary or advisable to enable each such Holder and each
such underwriter to consummate the sale or disposition in such
jurisdiction or jurisdiction, in which any such Holder or underwriter
shall have requested that the Registrable Securities be sold; provided,
however, that the Company shall not be required in connection therewith
to qualify to do business as a foreign corporation or take any action
that would subject it to taxation or general service of process in any
jurisdiction where it is not then so qualified or subject.
Except as otherwise provided in this Agreement, the Company shall have
sole control in connection with the preparation, filing, withdrawal, amendment
or supplementing of each Registration Statement, the selection of underwriters,
and the distribution of any preliminary prospectus included in the Registration
Statement, and may include within the coverage thereof additional shares of
Common Stock or other securities for its own account or for the account of one
or more of its other security holders;
Each seller of Registrable Securities as to which any registration is
being effected shall furnish to the Company such information regarding the
distribution of such securities and such other information as may otherwise be
required by the Securities Act to be included in such Registration Statement.
SECTION 6.05: WITHDRAWAL OF REGISTRATION RIGHTS. The Company shall not
be required by this Article VI to file any Registration Statement if, in the
opinion of counsel for the Warrantholders and the Company (or, should they not
agree, in the opinion of another counsel experienced in securities law matters
acceptable to counsel for such holders and the Company), the proposed public
offering or other transfer as to which such Registration Statement is requested
is exempt from applicable federal and state securities laws and would result in
all purchasers or transferees obtaining securities which are not "restricted
securities," as defined in Rule 144 under the Act. This Article VI shall
terminate and be of no further force or effect as of the first date upon which
all of the Warrant Shares then issuable upon exercise of the Warrants may be
sold publicly pursuant to Rule 144(k).
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SECTION 6.06: INDEMNIFICATION.
(a) Indemnification by Company. In connection with each
Registration Statement relating to disposition of Registrable
Securities, the Company shall indemnify and hold harmless each Holder
and each underwriter of Registrable Securities and each Person, if any,
who controls such Holder or underwriter (within the meaning of Section
15 of the Securities Act or Section 20 of the Exchange Act) against any
and all losses, claims, damages and liabilities, joint or several
(including any reasonable investigation, legal and other expenses
incurred in connection with, and any amount paid in settlement of any
action, suit or proceeding or any claim asserted), to which they, or any
of them, may become subject under the Securities Act, the Exchange Act
or other Federal or state law or regulation, at common law or otherwise,
insofar as such losses, claims, damages or liabilities arise out of or
are based upon any untrue statement or alleged untrue statement of a
material fact contained in any Registration Statement, Prospectus or
preliminary prospectus or any amendment thereof or supplement thereto,
or arise out of or are based upon any omission or alleged omission to
state therein a material fact required to be stated therein or necessary
to make the statements therein not misleading; provided, however, that
such indemnity shall not inure to the benefit of any Holder or
underwriter (or any Person controlling such Holder or underwriter within
the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act) on account of any losses, claims, damages or liabilities
arising from the sale of Registrable Securities if such untrue statement
or omission or alleged untrue statement or omission was made in such
Registration Statement, Prospectus or preliminary prospectus, or such
amendment or supplement, in reliance upon and in conformity with
information furnished in writing to the Company by the Holder or
underwriter specifically for use therein and provided, further, that
with respect to any preliminary prospectus, the foregoing
indemnification shall not inure to the benefit of any Holder from whom
the person asserting any loss, claim, damage, liability or expense
purchased Warrant Shares, or to any person controlling such Holder, if
copies of the Prospectus were timely delivered to such Holder and a copy
of the Prospectus (as then amended or supplemented if the Company shall
have timely furnished any amendments or supplements thereto) was not
sent or given by or on behalf of such Holder to such person, if required
by law to have been so delivered, at or prior to the written
confirmation of the sale of the Warrant Shares to such person, and if
such Prospectus (as so amended or supplemented) would have cured the
defect giving rise to such loss, claim, damage, liability or expense.
This indemnity agreement shall be in addition to any liability which the
Company may otherwise have.
(b) Indemnification by Holder. In connection with each
Registration Statement, each Holder shall indemnify, to the same extent
as the indemnification provided by the Company in Section 6.06(a), the
Company, its directors and each officer who signs the Registration
Statement and each Person who controls the Company (within the meaning
of Section 15 of the Securities Act and Section 20 of the Exchange Act)
but only insofar as such losses, claims, damages and liabilities arise
out of or are based upon any untrue statement or omission or alleged
untrue statement or omission which was made in the Registration
Statement, the Prospectus or preliminary prospectus or any amendment
thereof or
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supplement thereto, in reliance upon and in conformity with information
furnished in writing by such Holder to the Company specifically for use
therein. In no event shall the liability of any selling Holder of
Registrable Securities hereunder be greater in amount than the dollar
amount of the net proceeds received by such Holder upon the sale of the
Registrable Securities giving rise to such indemnification obligation.
The Company shall be entitled to receive indemnities from underwriters,
selling brokers, dealer managers and similar securities industry
professionals participating in the distribution, to the same extent as
provided above, with respect to information so furnished in writing by
such Persons specifically for inclusion in any Prospectus, Registration
Statement or preliminary prospectus or any amendment thereof or
supplement thereto.
(c) Conduct of Indemnification Procedure. Any party that
proposes to assert the right to be indemnified hereunder will, promptly
after receipt of notice of commencement of any action, suit or
proceeding against such party in respect of which a claim is to be made
against an indemnifying party or parties under this Section, notify each
such indemnifying party of the commencement of such action, suit or
proceeding, enclosing a copy of all papers served. No indemnification
provided for in Section 6.06(a) or 6.06(b) shall be available to any
party who shall fail to give notice as provided in this Section 6.06(c)
if the party to whom notice was not given was unaware of the proceeding
to which such notice would have related and was prejudiced by the
failure to give such notice, but the omission so to notify such
indemnifying party of any such action, suit or proceeding shall not
relieve it from any liability that it may have to any indemnified party
for contribution or otherwise than under this Section. In case any such
action, suit or proceeding shall be brought against any indemnified
party and it shall notify the indemnifying party of the commencement
thereof, the indemnifying party shall be entitled to participate in,
and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof,
with counsel satisfactory to such indemnified party, and after notice
from the indemnifying party to such indemnified party of its election so
to assume the defense thereof and the approval by the indemnifying party
to such indemnified party of its election so to assume the defense
thereof and the approval by the indemnified party of such counsel, the
indemnifying party shall not be liable to such indemnified party for any
legal or other expenses, except as provided below and except for the
reasonable costs of investigation subsequently incurred by such
indemnified party in connection with the defense thereof. The
indemnified party shall have the right to employ its counsel in any such
action, but the fees and expenses of such counsel shall be at the
expense of such indemnified party unless (i) the employment of counsel
by such indemnified party has been authorized in writing by the
indemnifying parties, (ii) the indemnified party shall have reasonably
concluded, based on the advice of its counsel, that there may be a
conflict of interest between the indemnifying parties and the
indemnified party in the conduct of the defense of such action (in which
case the indemnifying parties shall not have the right to direct the
defense of such action on behalf of the indemnified party) or (iii) the
indemnifying parties shall not have employed counsel to assume the
defense of such action within a reasonable time after notice of the
commencement thereof, in each of which cases the fees and expenses of
counsel shall be at the expense of the indemnifying parties , it being
understood, however, that the indemnifying parties shall not be liable
for the expenses of more than one separate counsel, which counsel
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shall be reasonably approved by the indemnifying parties. An
indemnifying party shall not be liable for any settlement of any action,
suit, proceeding or claim effected without its written consent.
(d) Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnification provided for
in Section 6.06(a) and 6.06(b) is due in accordance with its terms but
for any reason is held to be unavailable from the Company or any Holder,
the Company and the Holders shall contribute to the aggregate losses,
claims, damages and liabilities (including any investigation, legal and
other expenses reasonably incurred in connection with, and any amount
paid in settlement of, any action, suit or proceeding or any claims
asserted, but after deducting any contribution received by the Company
from persons other than the Holders, such as persons who control the
Company within the meaning of the Securities Act, officers of the
Company who signed any Registration Statement and directors of the
Company, who may also be liable for contribution) to which the Company
and one or more of the Holders may be subject in such proportion as is
appropriate to reflect the relative benefits received by the Company on
the one hand and each such Holder on the other from the offering of the
Warrant Shares or, if such allocation is not permitted by applicable law
or indemnification is not available as a result of the indemnifying
party not having received notice as provided in Section 6.06(c) hereof,
in such proportion as is appropriate to reflect not only the relative
benefits referred to above but also the relative fault of the Company on
the one hand and each such Holder on the other in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable
considerations. The relative benefits received by the Company and each
such Holder shall be deemed to be in the same proportion as (x) the
total proceeds from the offering (net of underwriting discounts but
before deducting expenses) received by the Company, bear to (y) the
dollar amount of the net proceeds received by such Holder upon the sale
of the Registrable Securities giving rise to such indemnification
obligation. The relative fault of the Company or any such Holder shall
be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact related to information
supplied by the Company or any such Holder and the parties' relative
intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company and the Holders agree
that it would not be just and equitable if contribution pursuant to this
Section 6.06(d) were determined by pro rata allocation (even if the
Holders were treated as one entity for such purpose) or by any other
method of allocation which does not take account of the equitable
considerations referred to above. Notwithstanding the provisions of this
Section 6.06(d), (i) in no case shall any Holder be liable or
responsible for any amount in excess of the dollar amount of the net
proceeds received by such Holder upon the sale of the Registrable
Securities giving rise to such indemnification obligation, and (ii) the
Company shall be liable and responsible for any amount in excess of such
dollar amount; provided, however, that no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. For purposes of this
Section 6.06, each person, if any, who controls a Holder within the
meaning of Section 15 of the Securities Act or Section 20(a) of the
Exchange Act shall have the same rights to
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contribution as such Holder, and each person, if any, who controls the
Company within the meaning of the Section 15 of the Securities Act or
Section 20(a) of the Exchange Act, each officer of the Company who shall
have signed any Registration Statement and each director of the Company
shall have the same rights to contribution as the Company, subject in
each case to clauses (i) and (ii) in the immediately preceding sentence
of this Section 6.06(d). Any party entitled to contribution will,
promptly after receipt of notice of commencement of any action, suit or
proceeding against such party in respect of which a claim for
contribution may be made against another party or parties under this
Section, notify such party or parties from whom contribution may be
sought, but the omission so to notify such party or parties from whom
contribution may be sought shall not relieve the party or parties from
whom contribution may be sought from any other obligation it or they may
have hereunder or otherwise than under this Section 6.06. No party shall
be liable for contribution with respect to any action, suit, proceeding
or claim settled without its written consent. Each Holder's obligations
to contribute pursuant to this Section 6.06(d) are several in proportion
to their respective underwriting commitments and not joint.
(e) Specific Performance. The Company and the Holder acknowledge
that remedies at law for the enforcement of this Section 6.06 may be
inadequate and intend that this Section 6.06 shall be specifically
enforceable.
ARTICLE VII
OTHER MATTERS
SECTION 7.01: AMENDMENTS AND WAIVERS. The provisions of this Warrant,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waiver or consents to departures from the provisions hereof
may not be given unless the Company has obtained the written consent of holders
of at least a majority of the outstanding Registrable Securities. Holders shall
be bound by any consent authorized by this Section whether or not certificates
representing such Registrable Securities have been marked to indicate such
consent.
SECTION 7.02: COUNTERPARTS. This Warrant may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
SECTION 7.03: GOVERNING LAW. This Warrant shall be governed by and
construed in accordance with the laws of the State of New York.
SECTION 7.04: SEVERABILITY. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstances, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provisions in every other respect and of the
remaining provisions contained herein shall not be affected or impaired thereby.
SECTION 7.05: ATTORNEYS' FEES. In any action or proceeding brought to
enforce any provisions of this Warrant, or where any provisions hereof or
thereof is validly asserted as a defense,
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the successful party shall be entitled to recover reasonable attorneys' fees and
disbursements in addition to its costs and expenses and any other available
remedy.
SECTION 7.06: NOTICE. Any notices or certificates by the Company to the
Holder and by the Holder to the Company shall be deemed delivered if in writing
and delivered in person or by registered mail (return receipt requested) to the
Holder addressed to him in care of Piper Jaffray Inc., 222 South Ninth Street,
Minneapolis, Minnesota 55402, Attention: Stuart Harvey or, if the Holder has
designated, by notice in writing to the Company, any other address, to such
other address, and if to the Company, addressed to it at BNC Mortgage, Inc.,
1063 McGaw Avenue, Irvine, California 92614, Attn: President. The Company may
change its address by written notice to the Holder and the Holder may change his
or its address by written notice to the Company.
IN WITNESS WHEREOF, this Warrant has been duly executed by the Company
under its corporate seal as of the 16 day of March, 1998.
BNC MORTGAGE, INC.
By: /s/ Kelly W. Monahan
-------------------------------------
Name: Kelly W. Monahan
Title: President
Attest: /s/ Evan R. Buckley
-----------------------------
Secretary
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ASSIGNMENT
(TO BE EXECUTED ONLY UPON ASSIGNMENT OF WARRANT CERTIFICATE)
For value received, ____________________ hereby sells, assigns and
transfers unto _________________________ the within Warrant Certificate,
together with all right, title and interest therein, and does hereby irrevocably
constitute and appoint ___________________ attorney, to transfer said Warrant
Certificate on the books of the within-named Company with respect to the number
of Warrants set forth below, with full power of substitution in the premises:
Name(s) of
Assignees(s) Address No. of Warrants
------------ ------- ---------------
And if said number of Warrants shall not be all the Warrants represented
by the Warrant Certificate, a new Warrant Certificate is to be issued in the
name of said undersigned for the balance remaining of the Warrants represented
by said Warrant Certificate.
Dated:
------------------
-----------------------------------------
Note: The above signature should
correspond exactly with the name on the
face of this Warrant Certificate.
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SUBSCRIPTION FORM
(TO BE EXECUTED UPON EXERCISE OF WARRANT PURSUANT TO SECTION 2.02(a)(i))
The undersigned hereby irrevocably elects to exercise the right of
purchase represented by the within Warrant Certificate for, and to purchase
thereunder ____________ shares of Common Stock, as provided for therein, and
tenders herewith payment of the purchase price in full in the form of cash or a
certified or official bank check in the amount of $ ____________.
Please issue a certificate or certificates for such Common Stock in the
name of:
Name:
----------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
(Please Print Name, Address and
Social Security Number)
Signature
------------------------------
NOTE: The above signature should respond exactly with the name on the first page
of this Warrant Certificate or with the name of the assignee appearing in the
assignment form below.
And if said number of shares shall not be all the shares purchasable
under the within Warrant Certificate, a new Warrant Certificate is to be issued
in the name of said undersigned for the balance remaining of the shares
purchasable thereunder rounded up to the next higher number of shares.
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CASHLESS EXERCISE FORM
(TO BE EXECUTED UPON EXERCISE OF WARRANT PURSUANT TO SECTION 2.02(a)(ii))
The undersigned hereby irrevocably elects to Exchange its Warrant for
such shares of Common Stock pursuant to the Cashless Exercise provisions of the
within Warrant Certificate, as provided for in Section 2.02(a)(ii) of such
Warrant Certificate.
Please issue a certificate or certificates for such Common Stock in the
name of:
Name:
----------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
(Please Print Name, Address and
Social Security Number)
Signature
------------------------------
NOTE: The above signature should correspond exactly with the name on the first
page of this Warrant Certificate or with the name of the assignee appearing in
the assignment form below.
And if said number of shares shall not be all the shares exchangeable or
purchasable under the within Warrant Certificate, a new Warrant Certificate is
to be issued in the name of the undersigned for the balance remaining of the
shares purchasable rounded up to the next higher number of shares.
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