MONTEREY HOMES CORPORATION
WARRANT
Common Stock Purchase Warrant Certificate
Warrants to Purchase
No. W- Shares
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THIS IS TO CERTIFY that, for value received ___________ or registered assigns,
is the registered holder ("Holder") of the number of Warrants ("Warrants") set
forth above, each of which entitles the holder to purchase, subject to the terms
and conditions set forth in the Warrant Agreement, which is hereby incorporated
herein and made a part hereof, and as hereinafter set forth, at any time on or
after October 17, 1994 and at or prior to the close of business on October 15,
2001, but not thereafter, one fully paid and non-assessable share of the common
stock, $.01 par value per share ("Common Stock"), of MONTEREY HOMES CORPORATION,
a Maryland corporation (the "Company"), or equivalent security of any successor
to it (the "Company"), at a purchase price of $4.0634, as adjusted, for a term
commencing on the date hereof and ending October 15, 2001 and to receive one or
more certificates for the Common Stock or equivalent securities so purchased,
upon satisfaction of one or more conditions precedent set forth herein and
presentation and surrender to NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION,
ATTN: Corporate Trust Department, Sixth Street and Marquette Ave., Minneapolis,
Minnesota 55479-0069 (the "Warrant Agent"), or its successor as Warrant Agent,
with the form of subscription duly executed, and accompanied by payment of the
purchase price of each share purchased, in U.S. dollars, either in cash or by
certified check or bank cashier's check, payable to the order of the Warrant
Agent. Fractional shares of the Company's Common Stock will not be issued upon
the exercise of the Warrants. For each Warrant exercised, an additional .2069
shares of the fully paid and non-assessable shares of the Common Stock of the
Company will be issued without the payment of any additional consideration.
The Company covenants and agrees that all shares of Common Stock
delivered upon the exercise of these Warrants will, upon delivery, be free from
all taxes, liens and charges with respect to the purchase thereof hereunder. The
Warrants shall not be exercisable in any jurisdiction where exercise would be
unlawful. The Company will use its best efforts to qualify the shares that may
be purchased upon exercise of these Warrants for sale in all jurisdictions where
holders of the Warrants reside.
The number of shares of Common Stock, or other equivalent equity
security, issuable upon the exercise of these Warrants and the purchase price
shall be subject to adjustment from time to time, in certain events, as set
forth in the Warrant Agreement, including certain sales of additional stock,
stock options, convertible securities, distribution of stock dividends, stock
splits, reclassifications or mergers.
The Company agrees at all times to reserve or hold available, or cause
to reserve or hold available, a sufficient number or shares of its Common Stock,
or other equivalent equity security, to cover the number of shares, or other
equivalent equity security, issuable upon the exercise of these and all other
Warrants of like tenor then outstanding.
This Warrant Certificate does not entitle the holder hereof, either at
law or in equity, to any voting rights or other rights as a stockholder of the
Company, or to any other rights whatsoever except the rights expressly herein
set forth, and no dividend shall be payable or accrue in respect of these
Warrants or the interest represented hereby, or the shares that may be purchased
upon exercise hereof until or unless, and except to the extent that, these
Warrants shall be duly exercised.
This Warrant Certificate is exchangeable at any time prior to
expiration upon the surrender hereof by the registered holder to the Warrant
Agent for one or more new Warrant Certificates of like tenor and date
representing in the aggregate the right to purchase the number of shares that
may be purchased upon exercise hereof, each of such new Warrant Certificates to
represent the right to purchase such number of shares as may be designated by
the registered holder at the time of such surrender.
The Company may deem and treat the registered holder of this Warrant
Certificate at any time as the absolute owner hereof and the Warrants covered
hereby for all purposes and shall not be affected by any notice to the contrary.
The issuance of the Warrants covered by this Warrant Certificate is
subject to the terms of the Warrant Agreement which is available at the
principal corporate trust office of the Warrant Agent. The Warrant Agreement is
incorporated herein by reference and made a part hereof and reference is hereby
made to the Warrant Agreement for a full description of the rights, limitations
of rights, obligations, duties and immunities hereunder of the Warrant Agent,
the Company and the holders of the Warrants. A copy of the Warrant Agreement is
on file at the above mentioned office of the Warrant Agent.
This Warrant Certificate shall not be valid or obligatory for any
purpose unless countersigned by the Warrant Agent.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to
be executed by its duly authorized officers, and the corporate seal hereunto
affixed.
Dated:
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MONTEREY HOMES CORPORATION
By:
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ITS PRESIDENT
ATTEST:
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SECRETARY
This is one of the Warrants referred to in the within mentioned Warrant
Agreement.
Countersigned:
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
Warrant Agent
By:
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Authorized Representative
Form of Reverse Side of Certificate
The Warrants represented by this certificate are subject to
restrictions on Transfer or exercise for the purpose of the
Corporation's maintenance of the net operating loss carry-overs,
capital loss carry-overs and built-in losses to which the Corporation
is entitled pursuant to the Internal Revenue Code of 1986, as amended.
Subject to certain further restrictions and except as expressly
provided in the Corporation's Charter, no person may engage in any
Transfer that is with any other person if such Transfer would cause the
Ownership Interest Percentage of any person or Public Group to increase
to 4.9 percent or above, or from 4.9 percent or above to a greater
Ownership Interest Percentage, or would create a new Public Group. Any
attempted Transfer that is prohibited by the Corporation's Charter
shall be void ab initio, and all right with respect to the Prohibited
Interests shall remain the property of the person who initially
purported to Transfer the Prohibited Interests until such time as the
Prohibited Interests are resold as provided in the Corporation's
Charter. All capitalized terms in this legend have the meanings defined
in the Charter of the Corporation, as the same may be amended from time
to time, a copy of which, including the restrictions on transfer and
ownership, will be furnished to each holder of Warrants on request and
without charge. Requests for such a copy may be directed to the
Secretary of the Corporation at the Corporation's principal executive
office.
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this Bond, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT- . . . . .Custodian . . . . . . .
(Cust) (Minor)
under Uniform Gifts (Transfer) to Minors Act
. . . . . . . . . . . . . . . . . . . . . . . . . .
(State)
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of
survivorship and not as tenants
in common
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT FORM
To assign this Warrant, fill in the form below:
I or we assign and transfer this Warrant to:
(INSERT ASSIGNEE'S SOCIAL SECURITY
OR TAX IDENTIFICATION NO.)
________________________________
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________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint ______________________________ as agent to transfer this
Warrant on the books of the Company. The agent may substitute another to act for
him.
Date:_____________________ Your Signature:________________________________
(Sign exactly as your name appears on the other
side of this Note)
Signature Guarantee:____________________________________________________________
By _______________________________________
The signature should be guaranteed by an
eligible guarantor institution (a bank,
stockbroker, savings and loan association
or credit union with membership in an
approved signature guarantee medallion
program) pursuant to Rule 17Ad-15 of the
Securities Exchange Act of 1934.
SUBSCRIPTION
(To be completed and signed only upon an exercise
of the Warrants in whole or in part)
TO: _______________________________________________
as Warrant Agent for Monterey Homes Corporation
The undersigned, the Holder of the attached Warrants, hereby
irrevocably elects to exercise the purchase right represented by the Warrants
for, and to purchase thereunder, ____________ Shares (as such terms are defined
in the Warrant dated October 17, 1994) from Monterey Homes Corporation (or other
securities or property), and herewith makes payment of $_______________ therefor
in cash or by certified or official bank check. The undersigned hereby requests
that the Certificate(s) for such securities be issued in the name(s) and
delivered to the address(es) as follows:
Name:___________________________________________________________________________
Address:________________________________________________________________________
Deliver to:_____________________________________________________________________
Address:________________________________________________________________________
If the foregoing Subscription evidences an exercise of the Warrants to
purchase fewer than all of the Shares to which the undersigned is entitled under
such Warrants, please issue a new Warrant, of like tenor, for the remaining
Shares or Warrants (or other securities or property) in the name(s), and deliver
the same to the address(es), as follows:
Name:___________________________________________________________________________
Address:________________________________________________________________________
DATED:________________________________ , 19____.
____________________________________________
(Name of Holder)
____________________________________________
(Signature of Holder or Authorized Signatory)
____________________________________________
(Social Security or Taxpayer Identification
Number of Holder)
Signature Guarantee:____________________________________________________________
By:____________________________________________
This signature should be guaranteed by an eligible
guarantor institution (a bank, stockbroker, savings
and loan association or credit union with membership
in an approved signature guarantee medallion program)
pursuant to Rule 17Ad-15 of the Securities Exchange
Act of 1934.