Exhibit 4.2
WARRANT AGREEMENT OF
IMPERIAL CREDIT INDUSTRIES, INC.
3,000,000 Shares
Dated as of October 10,2000
Common Stock Purchase Warrants
WARRANT AGREEMENT
This WARRANT AGREEMENT (the "Agreement") dated as of October 10, 2000,
is between Imperial Credit Industries, Inc., a California corporation (the
"Company"), and U.S. Stock Transfer Corporation, a California corporation (the
"Warrant Agent"), and for the benefit of the registered holders from time to
time of the Warrants issued hereunder (collectively, the "Holders").
In connection with the settlement of a consolidated class action
lawsuit (No. CV98- 1239-MA) (the "Action") against the Company in the United
States District Court for the District of Oregon (the "District Court") in
accordance with that certain Settlement Agreement by and between the Company and
the plaintiffs in the Action, dated as of October 10, 2000 (the "Settlement
Agreement"), the Company has agreed to issue THREE MILLION (3,000,000) common
stock purchase warrants (the "Warrants") to purchase in the aggregate 3,000,000
shares of its Common Stock (the shares of Common Stock issuable on exercise of
the Warrants being referred to herein as the "Warrant Shares"). Capitalized
terms used herein, if not otherwise defined, are defined in Article VI hereof.
The total number of Warrants that are to be issued pursuant to this
Agreement and/or the Exercise Price are subject to adjustment for events that
may occur prior to the issuance of the Warrants, as set forth in Section 2.4 of
the Settlement Agreement.
The Company proposes to issue certificates evidencing the Warrants
(such Warrant certificates issued pursuant to this Agreement being subsequently
called the "Warrant Certificates");
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements contained here, the Company and the Warrant Agent agree as follows:
Article I
Warrant Certificates
Section 1.1 Appointment of Warrant Agent. The Company appoints the
Warrant Agent to act on behalf of the Company in accordance with the
instructions set forth below, and the Warrant Agent accepts such appointment.
Section 1.2 Form of Warrant Certificates. The Warrant Certificates
shall be issued in registered form only. The text of the Warrant Certificates
shall be substantially as set forth in Exhibit A attached hereto and, in
---------
addition, may have such letters, numbers or other marks of identification or
designation and such legends, summaries, or endorsements stamped, printed,
lithographed or engraved on them as the Company may deem appropriate and as are
not inconsistent with the provisions of this Agreement, or as, in any particular
case, may be required
1
in the opinion of counsel for the Company, to comply with any law or with any
rule or regulation of any regulatory authority or agency, or to conform to
customary usage. The form of election to purchase or assign the Warrant Shares
(the "Purchase Form"), which shall be printed on the reverse of the Warrant,
shall be substantially as set forth in Exhibit B attached hereto.
---------
Section 1.3 Execution of Warrant Certificates. The Warrant Certificates
shall be executed on behalf of the Company by its Chair or President or any
Vice-President attested to by its Secretary or Assistant Secretary, either
manually or by facsimile signature printed on the Warrant Certificates. The
Warrant Certificates shall be manually countersigned and dated the date of
countersignature by the Warrant Agent and shall not be valid for any purpose
unless so countersigned and dated. In case any authorized officer of the Company
who shall have signed any of the Warrant Certificates shall cease to be such
officer of the Company either before or after delivery of the Warrant
Certificates by the Company to the Warrant Agent, the signature of such person
on such Warrant Certificates, nevertheless, shall be valid and such Warrant
Certificates may be countersigned by the Warrant Agent, and issued and delivered
to those persons entitled to receive the Warrants represented the Warrant
Certificates with the same force and effect as though the person who signed such
Warrant Certificates had not ceased to be such officer of the Company.
Section 1.4 Registration.
(a) Warrant Certificates representing in the aggregate Three
Million (3,000,000) Warrants shall initially be registered in the names of those
members of the plaintiff class in the Action, who are eligible to receive
Warrant Certificates (the "Authorized Claimants"), as stated in a letter
("Plaintiff Counsel Letter") to be delivered to the Company by Plaintiffs'
Settlement Counsel. The Plaintiff Counsel Letter shall be delivered to the
Company promptly upon completion of the claims administration process; provided,
however, that in any event such letter shall not be delivered or become
effective in advance of the completion of a fairness hearing (the "Fairness
Hearing") regarding the terms of the settlement of the Action before the
District Court and the approval of such settlement terms by the District Court.
The Plaintiff Counsel Letter shall include the legal name and address of each of
the Authorized Claimants and the number of Warrants that each Authorized
Claimant is to receive.
(b) Within seven (7) Business Days following receipt by the
Company of the Plaintiff Counsel Letter, the Company shall deliver to the
Warrant Agent a number of Warrant Certificates executed on behalf of the Company
that is sufficient to enable the Warrant Agent to deliver Warrant Certificates
to each of the Authorized Claimants. Within the later of (i) ten (10) Business
Days after the receipt by the Company of the Plaintiff Counsel Letter, (ii) as
promptly as practicable, but in any event within forty five (45) calendar days,
after the Registration Statement Effective Date or (iii) five (5) Business Days
after the Effective Date (as defined in the Settlement Agreement), the Warrant
Agent shall mail or cause to be mailed such Warrant Certificates to the
Authorized Claimants at the address provided for each of the Authorized
Claimants in the Plaintiff Counsel Letter.
2
Section 1.5 Warrant Records. The Warrant Agent shall maintain books
indicating the issuance of the Warrant Certificates. The Warrant Certificates
shall be numbered and shall be registered in a Warrant Register as they are
issued. The Company and the Warrant Agent shall be entitled to treat the
registered owner(s) of the Warrant Certificates (the "Holder(s)") as the
owner(s) in fact thereof for all purposes and shall not be bound to recognize
any equitable or other claim to or interest in such Warrant Certificates on the
part of any other person.
Section 1.6 Transferability. Upon issuance, the Warrants shall be
freely transferable without any restriction, other than restrictions applicable
to Persons who may be deemed Affiliates of the Company, and shall be duly
authorized, validly issued, fully paid, non- assessable and free from all liens
and security interests thereon created by the Company. The new Holder of any
Warrants so transferred shall continue to be bound by this Agreement.
Section 1.7 Compliance with Government Regulations; Market Maker.
(a) The Company shall file a registration statement (the
"Registration Statement") with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "Securities
Act") with respect to the Warrant Shares within (i) if there are no objections
to the terms of the Settlement Agreement at the Fairness Hearing, ten (10)
Business Days following entry by the District Court of the Final Judgment and
Order within the meaning of Paragraph 1.10 of the Settlement Agreement or (ii)
if there are objections raised to the terms of the Settlement Agreement at the
Fairness Hearing, no later than forty five (45) calendar days following the date
on which the Final Judgment and Order becomes "Final" as that latter term is
defined by paragraph 1.9 of the Settlement Agreement. The Company shall also use
its commercially reasonable efforts to cause the Registration Statement to be
declared effective as promptly as practicable by the Commission and to obtain
appropriate approvals or registrations (or exemptions from any otherwise
applicable requirements) as promptly as practicable with respect to the Warrants
and the Warrant Shares under the securities laws of at least those states and
U.S. territories in which any Authorized Claimant resides by no later than the
date of issuance of the Warrants as required under Section 1.4(b) (such date,
the "Warrant Issuance Date"). After the effective date of the Registration
Statement (the "Registration Statement Effective Date"), the Company shall issue
the Warrants by the Warrant Issuance Date; provided, however, that the Warrants
may not be exercised by, or Warrant Shares issued to, any Holder in any state in
which such exercise would be unlawful (all such Warrants, the "Unexercisable
Warrants").
(b) In the event that any Holder desires to exercise all or
any portion of Unexercisable Warrants, but at such time is still unable to do so
because such Holder resides in a state or United States territory in which such
exercise would be unlawful (such situation, a "Prohibited Exercise"), such
Holder may deliver written notice to the Company in accordance with Section 7.12
of its desire to exercise all or any portion of such Unexercisable Warrants and
the Company shall redeem all or the portion of such Warrants that such Holder
desires to
3
exercise as follows. To effect such redemption, such Holder must deliver the
Warrant Certificate(s) representing such Warrants to the Company, together with
an affidavit indicating that such Holder would exercise such Warrants but for
the Prohibited Exercise and notice of the number of Warrants that such Holders
desires to have redeemed by the Company. Within ten (10) Business Days of
receipt of such Warrant Certificate(s), such affidavit and such notice (such
date of receipt, the "Receipt Date"), the Company shall send to such Holder a
certified check, cashier's check or money order payable in United States
currency to the order of such Holder in an amount (the "Redemption Amount")
equal to (i) the total number of Warrants to be so redeemed, multiplied by (ii)
the difference, if positive, between the Current Market Value (as defined in
Section 3.1(d)) of the Common Stock and the Exercise Price (as defined in
Section 2.1) on the Receipt Date. On the Receipt Date, all such Warrants that
such Holder has indicated it desired to have redeemed shall be automatically
redeemed (and thereby immediately be terminated) and such Holder shall have no
rights with respect to such Warrants except the right to receive the Redemption
Amount.
(c) The Company shall use its best efforts to locate a
brokerage firm that is willing to serve as a market maker with respect to the
Warrants for the duration of the period beginning with the Warrant Issuance Date
and ending on the earlier of the date by which all Warrants are exercised or
redeemed or the Exercise Deadline (as defined in Section 2.3) and which shall
provide bid and ask quotations for the Warrants as an over-the-counter stock not
included in the regular Nasdaq OTC listings or the Bulletin Board."
Section 1.8 Legal Opinion.
(a) The Settlement Agreement provides for a settlement hearing
for final approval of the settlement (the "Settlement Hearing"). No later than
five (5) Business Days prior to the scheduled date of the Settlement Hearing the
Company shall provide Plaintiffs' Settlement Counsel with the written opinion of
▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇, in form reasonably satisfactory to Plaintiffs' Settlement
Counsel, substantially to the effect that the Warrants have been duly authorized
by the Company and, when issued and delivered in the manner and on the terms
described herein, will be valid and binding obligations of the Company,
enforceable in accordance with their terms and that the Warrant Shares are
exercisable are authorized, and are reserved in a sufficient amount to provide
for the exercise of the Warrants.
(b) On or before the issuance of the Warrants, the Company
shall provide Plaintiffs' Settlement Counsel with the written opinion of ▇▇▇▇▇,
▇▇▇▇▇ & ▇▇▇▇▇, in form reasonably satisfactory to it, to the effect that the
Warrants may be distributed to the Authorized Claimants without compliance with
the registration provisions of the Securities Act and the Warrants will be
freely transferable without any restriction, other than restrictions applicable
to Persons who may be deemed Affiliates of the Company.
4
Article II
Warrant Exercise Price and Exercise of Warrants
Section 2.1 Exercise Price. Each Warrant Certificate shall, when signed
by the Chair or President or any Vice-President and attested to by the Secretary
or Assistant Secretary of the Company and countersigned by the Warrant Agent,
entitle the Holder to purchase from the Company one share of Common Stock for
each Warrant evidenced by the related Warrant Certificate, at the purchase price
of THREE DOLLARS ($3.00) per share (the "Initial Exercise Price"), or such
adjusted number of shares at such adjusted purchase price as may be established
from time to time pursuant to the provisions of Article III, payable in full at
the time of exercise of the Warrant. Except as the context otherwise requires,
the term "Exercise Price" as used in this Agreement shall mean the purchase
price of one share of Common Stock, reflecting all appropriate adjustments made
in accordance with the provisions of Article III.
Section 2.2 Vesting of the Warrants. The Warrants shall immediately
vest and may be exercised on or after the original issuance date thereof, in
accordance with the terms of this Agreement and the Warrant Certificate.
Section 2.3 Exercisability of Warrants. Subject to an earlier
redemption of the Warrants as provided in Section 3.4, each Warrant may be
exercised at any time after the Warrants have been issued, until 5:00 p.m., Los
Angeles, California, U.S.A. time, on January 31, 2008 or, if such date is not a
Business Day, on the next succeeding Business Day (such date, the "Exercise
Deadline"); provided, however, that if there are objections raised to the terms
of the Settlement Agreement at the Fairness Hearing, the Exercise Deadline shall
be extended until seven (7) years after the later of the date on which the time
for filing an appeal regarding the terms of the Settlement Agreement has expired
or if any such appeal is filed, the date upon which such appeal is final;
provided, further, that under no circumstances shall the Exercise Deadline be
extended to a date later than July 31, 2008 (or, if such date is not a Business
Day, the next succeeding Business Day). After the Exercise Deadline, any
unexercised Warrants will be void and all rights of Holders shall cease.
Section 2.4 Continuing Effectiveness of Registration of Warrant Shares.
The Company agrees, from and after the time the Registration Statement
referenced in Section 1.7 has become effective, to use commercially reasonable
efforts to maintain the Registration Statement in effect under the Securities
Act and the securities laws of all states and U.S. territories in which any
Authorized Claimant resides and, if required by law, keep available for delivery
to a Holder exercising any Warrant upon exercise of such Warrant a prospectus
which complies with Section 10 of the Securities Act (unless in the opinion of
outside counsel to the Company, such registration is not required under the
Securities Act or the Company receives a letter from the staff of the Commission
stating that it would not take any enforcement action if such registration is
not effected), until the earlier of the date by which all Warrants are exercised
or redeemed or the Exercise Deadline; provided, however, that in the event, by
amendment to the Securities Act or otherwise, some other or different
requirement shall be imposed by law which shall govern or relate to the issuance
of the Warrant Shares, the Company shall use commercially reasonable
5
efforts to comply with such other or different requirements.
Section 2.5 Procedure for Exercise of Warrants.
(a) During the period specified in and subject to the
provisions of Section 2.3, upon the terms and subject to the conditions set
forth herein and in the applicable Warrant Certificate, Warrants in
denominations of one or whole number multiples thereof may be exercised by
surrendering the Warrant Certificates representing such Warrants to the Warrant
Agent at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇
▇▇▇▇▇ (its "Principal Office") or at such other office of a successor Warrant
Agent designated for such purpose, together with the Purchase Form duly
completed and executed, accompanied by payment in full to the Warrant Agent for
the account of the Company of the Exercise Price in effect at the time of such
exercise for each share of Common Stock with respect to which such Warrants are
being exercised. Such Exercise Price shall be paid in full by wire transfer or
by certified check, cashier's check or money order payable in United States
currency to the order of the Company. The date on which Warrants are exercised
in accordance with this Section 2.5 is sometimes referred to herein as the Date
of Exercise of such Warrants.
(b) The Company shall not be obligated to issue any fractional
share interests or fractional warrant interests upon the exercise of any Warrant
or Warrants, nor shall it be obligated to issue scrip or pay cash in lieu of
fractional interests. Any fraction equal to or greater than one-half shall be
rounded up to the next full Warrant Share or Warrant, as the case may be, and
any fraction less than one-half shall be eliminated.
Section 2.6 Issuance of Warrant Shares. Subject to Article III, as soon
as practicable after the Date of Exercise of any Warrant, the Warrant Agent on
behalf of the Company shall issue and cause to be delivered to or upon the
written order of the Holder and in such name or names as the Holder may
designate, a certificate or certificates for the number of full Warrant Shares
so purchased upon the exercise of such Warrant. The Company covenants that all
Warrant Shares that shall be issued upon exercise of the Warrants shall, upon
issuance in accordance with the terms of this Agreement, be duly authorized,
validly issued, fully-registered, freely transferable without any restriction,
other than restrictions applicable to Persons who may be deemed Affiliates of
the Company, free of preemptive rights, fully paid and non-assessable and free
from all liens and security interests thereon created by the Company. Each
person in whose name any such certificate for Warrant Shares is issued shall for
all purposes be deemed to have become the holder of record of the Warrant Shares
represented by those certificates on the Date of Exercise of the Warrants
resulting in the issuance of such shares, irrespective of the date of issuance
or delivery of such certificate for Warrant Shares; provided, however, that if,
at the date of the surrender of such Warrants and payment of the Warrant Price,
the transfer books for the Warrant Shares or other class of stock purchasable
upon the exercise of such Warrants shall be closed, the certificates for the
Warrant Shares or for shares of such other class of stock in respect of which
such Warrants are then exercised shall be issuable as of the date on which such
books shall next be opened (whether before or after the Expiration Date) and
until such date the
6
Company shall be under no duty to deliver any certificate for such Warrant
Shares or for shares of such other class of stock; provided, further, that the
transfer books of record, unless otherwise required by law, shall not be closed
at any one time for a period longer than three (3) Business Days.
Section 2.7 Payment of Taxes and Costs. The Company will pay all
documentary stamp taxes attributable to the issuance of Warrant Certificates or
the issuance of Warrant Shares upon the exercise of Warrants; provided, however,
that the Company shall not be required to pay any tax or taxes which may be
payable in respect of any transfer involved in the issue of any Warrant
Certificates, or in respect of the issue of any certificates for Warrant Shares
upon exercise of Warrants, in a name other than that of the registered holder of
a Warrant Certificate surrendered upon the exercise of a Warrant, and the
Company shall not be required to issue or deliver such certificates unless or
until the person or persons requesting the issuance thereof shall have paid to
the Company the amount of such tax or shall have established to the satisfaction
of the Company that such tax has been paid. In addition, the Company shall pay
all costs associated with its issuance, qualification, registration and
distribution of the Warrants and the Warrant Shares required to be performed by
the Company under this Agreement except for income taxes payable by the Holders,
postage and other costs incurred by the Holders in submitting the Warrant
Certificates or the Warrant Shares to the Warrant Agent or Transfer Agent for
exercise or transfer, and those taxes referenced in the proviso of the preceding
sentence.
Section 2.8 Certificates for Unexercised Warrants. If less than all of
the Warrants represented by a Warrant Certificate are exercised, the Warrant
Agent shall execute and mail, by first-class mail, within ten (10) Business Days
after the Date of Exercise, to the Holder of such Warrant Certificate, or such
other person as shall be designated in the election to purchase, a new Warrant
Certificate representing the number of full Warrants not exercised. In no event
shall a fraction of a Warrant be exercised, and the Warrant Agent shall
distribute no Warrant Certificates representing fractions of Warrants under this
or any other section of this Agreement.
Section 2.9 Reservation of Shares. There have been reserved, and the
Company shall at all times reserve and keep available for issuance upon the
exercise of Warrants a number of its authorized but unissued shares or treasury
shares, or both, of Common Stock that will be sufficient to permit the exercise
in full of all outstanding Warrants. The transfer agent for the Company's Common
Stock, and every subsequent transfer agent for any shares of the Company's
capital stock issuable upon the exercise of Warrants, will be irrevocably
authorized and directed at all times to reserve such number of authorized shares
as shall be required for such purpose. The Company will keep a copy of this
Agreement on file with the transfer agent for the Company's Common Stock and
with every subsequent transfer agent for any shares of the Company's capital
stock issuable upon the exercise of the Warrants. The Warrant Agent is hereby
irrevocably authorized to requisition from time to time from such transfer agent
the stock certificates required to honor outstanding Warrants upon exercise of
the Warrants in accordance with the terms of this Agreement. The Company will
supply such transfer agent with duly executed stock certificates for such
purposes. All Warrant Certificates surrendered in the
7
exercise of the rights thereby evidenced shall be cancelled by the Warrant Agent
and shall thereafter be delivered to the Company, or, at the direction of the
Company, destroyed. After the Date of Exercise of any Warrants, no shares shall
be subject to reservation in respect of such Warrants.
Section 2.10 Lost, Stolen, Mutilated or Destroyed Warrant Certificates.
If any Warrant Certificate shall be mutilated, lost, stolen or destroyed, the
Company shall direct the Warrant Agent to execute and deliver, in exchange and
substitution for and upon cancellation of a mutilated Warrant Certificate, or in
lieu of or in substitution for a lost, stolen or destroyed Warrant Certificate,
a new Warrant Certificate for the number of Warrants represented by the Warrant
Certificate so mutilated, lost, stolen or destroyed but only upon receipt of
evidence of such loss, theft or destruction of such Warrant Certificate, and of
the ownership of it, and indemnity or bond, if requested, all satisfactory to
the Company and the Warrant Agent. Any such new Warrant Certificate shall
constitute an original contractual obligation of the Company, whether or not the
allegedly mutilated, lost or stolen or destroyed Warrant Certificate shall be at
any time enforceable by anyone.
Section 2.11 Warrant Redemption Price. Pursuant to Section 3.4, upon
the occurrence of such conditions and requirements as are set forth therein, the
Holders of the Warrants may be entitled to receive a Warrant Redemption Price.
The Warrant Redemption Price shall initially be set at ONE DOLLAR ($1.00) per
Warrant. The Warrant Redemption Price shall be equitably adjusted in the event
of any adjustment in the number of Warrant Shares and the Exercise Price under
the provisions of Article III to the extent necessary so that a Holder of any
Warrants shall be entitled to receive the same aggregate Warrant Redemption
Price in respect of such Warrants that such Holder would have been entitled to
receive prior to such adjustment in number of Warrant Shares and Exercise Price.
Wherever the "Warrant Redemption Price" is referenced herein, such reference
shall be understood to be adjusted as provided for in this Section 2.11.
Article III
Adjustments, Redemption, Notice Provisions and Other Agreements
Section 3.1 Adjustment of Exercise Price. Subject to the provisions of
this Article III, the Exercise Price in effect from time to time shall be
subject to adjustment, as follows:
(a) In case the Company shall (i) declare a dividend or make a
distribution on the Outstanding shares of its Common Stock in shares of its
Common Stock, (ii) subdivide or reclassify the Outstanding shares of its Common
Stock into a greater number of shares, or (iii) combine or reclassify the
Outstanding shares of its Common Stock into a smaller number of shares, the
Exercise Price in effect immediately after the record date for such dividend or
distribution or the effective date of such subdivision, reclassification or
combination shall be proportionately adjusted by multiplying the then Exercise
Price by a fraction, the numerator of which shall be the number of shares of
Common Stock Outstanding immediately prior to such
8
event and the denominator of which shall be the number of shares of Common Stock
Outstanding immediately after such event, and the product so obtained shall
thereafter be the Exercise Price then in effect. Shares of Common Stock owned by
or held for the account of the Company or any majority-owned subsidiary shall
not be deemed outstanding for the purpose of any such computation. Such
adjustment shall be made successively whenever any event specified above shall
occur.
(b) In case the Company shall fix a record date for the
issuance of rights or warrants to all holders of its Common Stock entitling them
to subscribe for or purchase shares of its Common Stock at a price per share
less than the Current Market Price (as such term is defined in Subsection 3.1(d)
below) of a share of Common Stock of the Company on such record date, other than
the issuance of any Warrants pursuant to the Settlement Agreement, the Exercise
Price in effect immediately after such record date shall be adjusted so that it
shall equal the price determined by multiplying the Exercise Price in effect
immediately prior thereto by a fraction, of which the numerator shall be the
number of shares of Common Stock Outstanding on such record date plus the number
of shares of Common Stock which the aggregate offering price of the total number
of shares of such Common Stock so offered would purchase at the Current Market
Price per share, and of which the denominator shall be the number of shares of
Common Stock Outstanding on such record date plus the number of additional
shares of Common Stock offered for subscription or purchase. In case such
subscription price may be paid, in whole or in part, in a form other than cash,
the value of such consideration shall be determined in good faith by the
Company, subject to the provisions of Section 3.7. Shares of Common Stock owned
by or held for the account of the Company or any majority-owned subsidiary shall
not be deemed outstanding for the purpose of any such computation. Such
adjustment shall be made successively whenever such a record date is fixed. To
the extent that any such rights or warrants are not so issued or expire
unexercised, the Exercise Price then in effect shall be readjusted to the
Exercise Price which would then be in effect if such record date had not been
fixed for such unissued or expired unexercised rights or warrants.
(c) In case the Company shall fix a record date for the making
of a distribution to all holders of shares of its Common Stock (including any
such distribution made in connection with a consolidation or merger in which the
Company is the continuing corporation) (i) of shares of any class other than its
Common Stock or (ii) of evidences of its indebtedness or (iii) of assets
(excluding cash dividends or distributions, and dividends or distributions
referred to in Subsection 3.1(a) above) or (iv) of rights or warrants to acquire
securities of the Company (excluding those rights or warrants referred to in
Subsection 3.1(b) above), then in each such case the Exercise Price in effect
immediately thereafter shall be determined by multiplying the Exercise Price in
effect immediately prior thereto by a fraction, of which the numerator shall be
the Current Market Price per share of Common Stock on such record date, less the
fair market value per share (as determined in good faith by the Company, subject
to the provisions of Section 3.7) of said shares or evidences of indebtedness or
assets or rights or warrants so distributed, and of which the denominator shall
be such Current Market Price per share of Common Stock. Such adjustment shall be
made successively whenever such a
9
record date is fixed. If such distribution is not so made, the Exercise Price
then in effect shall be readjusted to the Exercise Price which would then be in
effect if such record date had not been fixed.
(d) The "Current Market Price" per share at any date shall be
deemed to be the average of the daily closing prices of the Common Stock for
thirty (30) consecutive Trading Days immediately prior to such date. The closing
price for each day shall be: (i) the average (on that date) of the high and low
prices of the Common Stock on the principal national securities exchange on
which the Common Stock is traded, if the Common Stock is then traded on a
national securities exchange; or (ii) the last reported sale price (on that
date) of the Common Stock on the NASDAQ National Market System, if the Common
Stock is not then traded on a national securities exchange; or (iii) the closing
bid price (or average of bid prices) last quoted (on that date) by an
established quotation service for over-the-counter securities, if the Common
Stock is not reported on the NASDAQ National Market System. If the closing price
of the Company's Common Stock is not so reported, such price shall be determined
by such other generally accepted source of publicly reported bid and asked
quotations as the Company may reasonably designate; provided, however, that if
the Common Stock is not publicly traded, the "Current Market Price" per share
shall mean the fair value per share as determined in good faith by the Company,
subject to the provisions of Section 3.7. The term "Trading Days" shall mean a
day on which the Nasdaq National Market System, or such other principal national
securities exchange on which the Common Stock is then listed or admitted to
trading, is open for the transaction of business, or, if the Common Stock is not
listed or admitted to trading on any national securities exchange, any Business
Day.
(e) All calculations under this Section 3.1 shall be made to
the nearest cent.
Section 3.2 No Adjustments to Exercise Price. No adjustment in the
Exercise Price in accordance with the provisions of paragraph (a), (b) or (c) of
Section 3.1 need be made unless such adjustment would require an increase or
decrease of at least one percent (1%) in such Exercise Price; provided, however,
that the amount by which any adjustment is not made by reason of the provisions
of this Section 3.2 shall be carried forward and taken into account at the time
of any subsequent adjustment in the Exercise Price.
Section 3.3 Adjustment to Number of Shares. Unless the Company shall
have exercised its election as provided in Section 3.9, upon each adjustment of
the Exercise Price pursuant to paragraph (a), (b) or (c) of Section 3.1, each
Warrant shall thereupon evidence the right to purchase that number of shares of
Common Stock (calculated to the nearest hundredth of a share) obtained by
multiplying the number of shares of Common Stock purchasable immediately prior
to such adjustment upon exercise of the Warrant by the Exercise Price in effect
immediately prior to such adjustment and dividing the product so obtained by the
Exercise Price in effect immediately after such adjustment.
10
Section 3.4 Reorganizations; Change of Control; Going Private
Transactions. In case of (i) any consolidation or merger of the Company with or
into another entity (including, without limitation, any merger or consolidation
in which ICII is not the surviving entity and such surviving entity is not a
public company subject to the reporting requirements of the Exchange Act, but
not including any merger or consolidation immediately following which the
shareholders of the Company and any trustee or fiduciary of any Company employee
benefit plan immediately prior to such merger or consolidation together own at
least 60% of the voting power, directly or indirectly, of the surviving entity
following such merger or consolidation) or the sale, transfer or other
disposition in a single transaction or related series of transactions to any
Entity Not under the Control of the Company of all or substantially all of the
assets of the Company (including, without limitation, the common stock of
Southern Pacific Bank owned by the Company) or Southern Pacific Bank (all of
such actions being collectively referred to herein as a "Reorganization"), or
(ii) any transaction, including, without limitation, a merger of consolidation
of the Company, that constitutes a Change of Control and/or Going Private
Transaction (each, as defined in Article VI), each Holder may elect to have its
Warrants exercised, redeemed or, under certain circumstances, retained in any
combination pursuant to one or more of the subsections in this Section 3.4.
Notwithstanding the foregoing, if a Holder shall not have elected in respect of
its Warrants to either exercise or redeem such Warrants in accordance with the
requirements of Sections 3.4(a), 3.4(b) or 3.4(c), all of its Warrants for which
such an election has not been made shall be automatically redeemed pursuant to
Section 3.4(c) unless the Company is the surviving corporation in any such
Reorganization or Change of Control and also remains a public company subject to
the reporting requirements of the Exchange Act, in which case, all of such
Warrants shall be automatically retained pursuant to Section 3.4(d). The Company
shall provide to each Holder in accordance with the provisions of Section 7.12
at least thirty (30) calendar days advance written notice (the "Advance Notice")
of any anticipated Reorganization, Change of Control or Going Private
Transaction (any one or more of such transactions, a "Material Transaction").
Such notice shall include: (i) the date or expected date such Material
Transaction is to take place (the "Transaction Date"); (ii) statements to the
effect that (x) such Holder has a right to elect between the options set forth
in Sections 3.4(a), 3.4(b) and 3.4(c) and, under certain circumstances, Section
3.4(d), (y) such Holder should carefully review this Agreement to determine its
rights and the consequences if such Holder does not timely make any such
election and (z) a copy of this Agreement may be requested by such Holder from
the Warrant Agent pursuant to Section 7.20 and that a form of this Agreement is
attached as an exhibit to a specified filing of the Company with the Commission
with information on how such filing may be accessed over the internet by such
Holder; (iii) the time, if any such time is to be fixed, as of which the holders
of record of Common Stock shall be entitled to exchange their shares of Common
Stock for the securities or other property deliverable upon such Material
Transaction; and (iv) a brief description of such Material Transaction. The
Company shall not effect any such Material Transaction in which the Company
would not be the surviving entity and which would, after taking into account the
effect of any elections made or not made by the Holders under this Section 3.4,
require payment of the Warrant Redemption Price to any Holder, unless upon or
prior to the consummation of such
11
Material Transaction the successor corporation shall have assumed by written
instrument such obligation to pay the Warrant Redemption Price to any such
Holder.
(a) At any time prior to any Material Transaction, the Holder
may elect to exercise all or any portion of its Warrants pursuant to the terms
set forth in Section 2.5.
(b) At any time prior to any Material Transaction, the Holder
may elect to exercise all or any portion of its Warrants contingent upon the
consummation of the Material Transaction (a "Contingent Exercise"). In the event
that the Holder elects to make a Contingent Exercise, the Holder shall notify
the Warrant Agent of such election to make a Contingent Exercise and the method
of exercising the Warrants shall otherwise be as specified in Section 2.5. The
Warrant Agent shall hold all Warrant Certificates and payments received from any
Holder pursuant to a Contingent Exercise in trust for those Holders electing to
make a Contingent Exercise until the Material Transaction is effected. If, for
whatever reason, the Material Transaction described in the Advance Notice does
not occur on or before the Transaction Date stated in such Advance Notice, the
Warrant Agent shall promptly return all surrendered Warrant Certificates to each
respective Holder together with the Exercise Price previously received from each
Holder. Such reimbursed Exercise Price shall be paid in full by wire transfer or
by certified check, cashier's check or money order payable in United States
currency to the order of the Holder.
(c) At any time prior to any Material Transaction, the Holder
may elect to redeem all or any portion of its Warrants (a "Redemption Election")
by providing written notice to the Warrant Agent as provided in this Section
3.4(c). All Warrants for which a Holder has made a Redemption Election at any
time prior to the Material Transaction shall, and if the Company is not the
surviving corporation and/or the Company does not remain a public company
subject to the reporting requirements of the Exchange Act after such Material
Transaction, all of such Holder's other Warrants which it has not exercised
pursuant to Sections 3.4(a) or 3.4(b) shall, at the time of such Material
Transaction, be automatically redeemed (and thereby immediately be terminated)
and no Holder shall have any rights with respect to any Warrant except the right
to receive the Warrant Redemption Price (as in effect immediately prior to such
Material Transaction) for each Warrant held by such Holder upon surrender of the
related Warrant Certificate to the Warrant Agent at its Principal Office. In the
event that a Holder elects to make a Redemption Election, such Holder shall
provide written notice to the Warrant Agent of its decision to make a Redemption
Election and the number of its Warrants to be subject to such election, and
shall surrender (at any time prior to such Material Transaction) the Warrant
Certificates representing such Warrants to be redeemed together with such
written notice to the Warrant Agent at its Principal Office or at such other
office of a successor Warrant Agent designated for such purpose. Within three
(3) Business Days following the consummation of any such Material Transaction,
the Company shall deposit with the Warrant Agent funds to be held in trust for
the Warrant Holders that are equal to the Warrant Redemption Price (as in effect
immediately prior to such Material Transaction) multiplied by the number of
Warrants outstanding immediately prior to such Material Transaction that were
not exercised and/or
12
retained pursuant to Sections 3.4(a), 3.4(b) or 3.4(d). The payment of the
Warrant Redemption Price to each Holder for each Warrant redeemed from each
Holder shall be made by the Warrant Agent within ten (10) Business Days after
the surrender of such Holder's Warrant Certificate or Certificates (or if such
Certificate or Certificates were mutilated, lost, stolen or destroyed, after
receipt of documents and an indemnity or bond in accordance with the
requirements of Section 2.10). Notwithstanding any other provision of this
Agreement, the right of the Holders to have the Warrants redeemed as provided
herein shall expire on the Exercise Deadline.
(d) If a Holder shall not have elected to exercise or redeem
all of the Warrants held by such Holder pursuant to Sections 3.4(a), 3.4(b) or
3.4(c) and the Company is the surviving corporation in the Reorganization or
Change of Control and the Company also remains a public company subject to the
reporting requirements of the Exchange Act, such Holder shall be deemed to have
elected to retain all of its unexercised or unredeemed Warrants on the same
terms and conditions as set forth in this Agreement.
Section 3.5 Certain Mergers or Consolidations. If after the date hereof
there shall be a merger or consolidation of the Company with or into another
corporation, a limited liability company, a partnership or any other legal
entity (each of the foregoing being referred to herein as a "Person") in which
the Company is not the surviving entity and such surviving entity is a public
company subject to the reporting requirements of the Exchange Act, other than
any merger or consolidation of the Company which constitutes a Material
Transaction, then, as a part of such transaction, such surviving entity shall
agree by written instrument that each Holder shall thereafter be entitled to
receive upon exercise of its Warrants, during the period specified in its
Warrants and upon payment of the Exercise Price required by its Warrants, the
number of shares of stock or other securities, cash or property of the successor
corporation or other Person resulting from such transaction, to which a holder
of the shares of Common Stock deliverable upon exercise of such Warrants would
have been entitled under the provisions of the agreement in such transaction (or
otherwise pursuant to such transaction) if such Warrants had been exercised
immediately before such transaction. In any such case, appropriate adjustment
(as determined reasonably and in good faith by the Company's Board of Directors)
shall be made in the application of the provisions of this Agreement with
respect to the rights and interests of the Holders after such transaction to the
end that the provisions of this Agreement (including adjustment of the Exercise
Price then in effect and the number of shares of Common Stock issuable upon
exercise hereof and providing to the Holders the options that would have become
available to such Holders in the event of a Material Transaction) shall be
applicable after the transaction, as near as reasonably may be, in relation to
any shares or other property deliverable after the transaction upon exercise of
such Warrants.
Section 3.6 Holders of Warrant Certificates Not Deemed Shareholders.
Nothing contained in this Agreement or in any of the Warrant Certificates shall
be construed as conferring upon any Holder thereof the right to vote or to
consent or to receive notice as shareholders in respect of meetings of
shareholders or the election of directors of the Company or any other matter, or
any rights whatsoever as shareholders of the Company.
13
Section 3.7 Verification of Computations. Any determination as to
whether an adjustment in the Exercise Price and the number of Warrant Shares
issuable under a Warrant is required pursuant to Article III, or as to the
amount and number of any such adjustment, or as to a determination of the
Current Market Price or any computations made pursuant to Section 3.5, if
required, shall be binding upon the Holders and the Company if made in good
faith by the Company. However, in the event of a dispute between the Holders and
the Company as to the accuracy of the Company's computation of the amount or
number of any such adjustment, determination or computation, which dispute
cannot be resolved through good faith discussions and involves a variance (based
upon the difference between the amount or number of such adjustment,
determination or computation as computed by the Company and the amount or number
of such adjustment, determination or computation as computed by the Holders)
equal or greater than 20% of such amount or number, in such event the Company
shall select a nationally recognized firm of independent public accountants to
verify the amount or number of such disputed adjustment, determination or
computation (such selected firm, the "Designated Accounting Firm"); provided,
however, that the Designated Accounting Firm may not have been employed by the
Company or any officer or director of the Company for at least one year prior to
such selection and the Designated Accounting Firm may not be otherwise employed
by the Company (except to verify subsequent computations under this Section 3.7)
for a period of one year after such selection; and provided, further, that if
the Company after using good faith efforts is unable to locate such a nationally
recognized firm that meets the requirements of the preceding proviso that is
willing to verify the amount or number of such disputed adjustment,
determination or computation, the Company may select any firm of independent
public accountants, subject to the prior approval of Plaintiffs' Settlement
Counsel, to verify such amount or number. If such a verification is required
under this Section 3.7, the amount or number of such adjustment, determination
or computation set forth in the certificate, report or other written statement
of the accounting firm performing such verification shall be conclusive evidence
of the correctness of any such amount or number made under this Article III.
Section 3.8 Notice of Adjustments. Whenever any adjustment is made
pursuant to this Article III, the Company shall cause notice of such adjustment
to be mailed to the Warrant Agent within seven (7) calendar days after the event
requiring such an adjustment to be made, such notice to include in reasonable
detail (i) the events precipitating the adjustment, (ii) the computation of any
adjustments, and (iii) the Exercise Price, the number of shares or the
securities or other property purchasable upon exercise of each Warrant after
giving effect to such adjustment. The Warrant Agent shall be entitled to rely on
such notice and any adjustment therein contained and shall not be deemed to have
knowledge of any such adjustment unless and until it shall have received such
notice. The Warrant Agent shall within seven (7) calendar days after receipt of
such notice from the Company cause a similar notice to be mailed to each Holder.
Section 3.9 Deferral of Issuance of Warrant Shares. In any case in
which this Article III shall require that an adjustment in the Exercise Price be
made effective as of the record date (the "Specified Record Date") for a
specified event (the "Trigger Event"), the Company may
14
elect to make the following deferral: With respect to any Warrant exercised
after the Specified Record Date but before the occurrence of the Trigger Event,
the Company may defer the issuance of the Warrant Shares and other capital stock
of the Company, if any, issuable to the Holder of such Warrant over and above
any Warrant Shares and other capital stock of the Company issuable upon such
exercise on the basis of the Exercise Price in effect prior to such adjustment
until no later than five (5) Business Days following the Trigger Event;
provided, however, that the Company shall no later than five (5) Business Days
following the exercise of the Warrant promptly deliver to such Holder a due ▇▇▇▇
or other appropriate instrument evidencing such Holder's right to receive such
additional shares upon the occurrence of the Trigger Event.
Section 3.10 Warrant Certificate Amendments. Irrespective of any
adjustments pursuant to this Article III, Warrant Certificates theretofore or
thereafter issued need not be amended or replaced, but certificates thereafter
issued shall bear an appropriate legend or other notice of any adjustments.
Section 3.11 Listing of Warrant Shares. So long as the Company's Common
Stock qualifies for listing on any national securities exchange or NASDAQ, the
Company shall use its commercially reasonable efforts to maintain the Warrants
Shares as being listed on one of the national exchanges or NASDAQ.
Section 3.12 Independent Application. Except as otherwise provide
herein, all sections and subsections of this Article III are intended to operate
independently of one another (but without duplication). If an event occurs that
requires the application of more than one section or subsection, all applicable
sections or subsections shall be given independent effect without duplication.
Article IV
Split Up, Combination, Exchange, Transfer and Cancellation of
Warrant Certificates
Section 4.1 Split Up, Combination, Exchange and Transfer of Warrant
Certificates. Prior to the Exercise Deadline, Warrant Certificates, subject to
the provisions of Section 4.2, may be split up, combined or exchanged for other
Warrant Certificates representing a like aggregate number of Warrants or may be
transferred in whole or in part. Any Holder desiring to split up, combine or
exchange a Warrant Certificate or Warrant Certificates shall make such request
in writing delivered to the Warrant Agent at its Principal Office and shall
surrender the Warrant Certificate or Warrant Certificates so to be split up,
combined or exchanged at said office. Subject to any applicable laws, rules or
regulations restricting transferability, any restriction on transferability that
may appear on a Warrant Certificate in accordance with the terms hereof, or any
"stop-transfer" instructions the Company may give to the Warrant Agent to
implement any such restriction (which instructions the Company is expressly
authorized to give), transfer of outstanding Warrant Certificates may be
effected by the Warrant Agent from time to time upon the books of the Company to
be maintained by the
15
Warrant Agent for that purpose, upon a surrender of the Warrant Certificate to
the Warrant Agent at its Principal Office, with the assignment form set forth in
the Warrant Certificate duly executed and with signatures guaranteed. Upon any
such surrender for split up, combination, exchange or transfer, the Warrant
Agent shall execute and deliver to the person entitled thereto a Warrant
Certificate or Warrant Certificates, as the case may be, as so requested. The
Warrant Agent shall not be required to effect any split up, combination,
exchange or transfer which will result in the issuance of a Warrant Certificate
evidencing a fraction of a Warrant.
Section 4.2 Cancellation of Warrant Certificates. Any Warrant
Certificate surrendered upon the exercise of Warrants or for split up,
combination, exchange or transfer, or purchased or otherwise acquired by the
Company, shall be cancelled and shall not be reissued by the Company; and,
except as provided in Section 2.8 in case of the exercise of less than all of
the Warrants evidenced by a Warrant Certificate or in Section 4.1 in case of a
split up, combination, exchange or transfer, no Warrant Certificate shall be
issued under this agreement in lieu of such cancelled Warrant Certificate. Any
Warrant Certificate so cancelled shall be destroyed by the Warrant Agent unless
otherwise directed by the Company. The Warrant Agent shall furnish to the
Company written confirmation of the destruction of the Warrant Certificates so
cancelled.
Article V
Representations and Warranties of the Company
Section 5.1 Due Authority. The Company represents and warrants that the
execution and delivery by the Company of this Warrant Agreement and the
performance of all obligations of the Company hereunder, including the issuance
to the Holders of the Warrants representing the right to acquire the Warrant
Shares, have been duly authorized by all necessary corporate action on the part
of the Company, and this Warrant Agreement is not inconsistent with the
Company's Charter or Bylaws, does not contravene any law of governmental rule,
regulation or order applicable to it, does not and will not contravene any
provision of, or constitute a default under any indenture, mortgage, contract or
other instrument to which it is a party or by which it is bound, and this
Warrant Agreement constitutes a legal, valid and binding agreement of the
Company, enforceable in accordance with its terms.
Section 5.2 Consents and Approvals. The Company represents and warrants
that no consent or approval of, giving of notice to, registration with, or
taking of any other action in respect of any state, federal or other
governmental authority or agency is required with respect to the execution,
delivery and performance by the Company of its obligations under this Warrant
Agreement, except for the registration of the Warrant Shares under the
Securities Act and any filing required by applicable state and United States
territories securities law in respect of the Warrants and the Warrant Shares,
which filing in respect of the Warrant Shares under the Securities Act shall be
effective at the time of the issuance of the Warrants and, subject to Section
2.4 hereof, at the time of the issuance of the Warrant Shares.
16
Article VI
Certain Definitions
As used in this Warrant Agreement, the following terms shall have the
following respective meanings:
(a) Affiliate shall have the same meaning given such term in
Rule 144(a) promulgated under the Securities Act.
(b) Business Day means any day other than a Saturday, a
Sunday, or a day on which banking institutions in the State of California are
authorized or obligated by law or executive order to close.
(c) Change of Control means a transaction or related series of
transactions in which forty percent (40%) or more of the issued and Outstanding
shares of Common Stock are sold to or purchased by any person or group of
persons acting in concert.
(d) Common Stock means the Common Stock of the Company, no par
value, as constituted on the date of this Agreement, and any capital stock into
which such Common Stock may thereafter be changed, and shall also include (i)
capital stock of the Company of any other class (regardless of how denominated)
issued to the holders of shares of any Common Stock upon any reclassification
thereof which is also not preferred as to dividends or liquidation over any
other class of stock of the Company and which is not subject to redemption and
(ii) shares of common stock of any successor or acquiring corporation (as
referred to in Article III) received by or distributed to the holders of Common
Stock of the Company in the circumstances contemplated by Article III hereto.
(e) Entity Not under the Control of the Company means any
entity in which the Company does not own, directly or indirectly, a majority of
the voting securities of such entity.
(f) Exercise Price shall mean, in respect of a share of Common
Stock at any date herein specified, the initial Exercise Price set forth in this
Agreement as adjusted from time to time pursuant to Article III.
(g) Exchange Act shall mean the Securities and Exchange Act of
1934, as amended.
(h) Going Private Transaction means any transaction a result
of which is that the Company is no longer a public company subject to the
reporting requirements of the Exchange Act after such transaction.
(i) Outstanding shall mean, when used with reference to Common
Stock, at any date as of which the number of shares thereof is to be determined,
all issued shares of
17
Common Stock, except shares then owned or held by or for the account of the
Company or any subsidiary thereof, and shall include all shares issuable in
respect of outstanding scrip or any certificates representing fractional
interests in shares of Common Stock.
(j) Plaintiffs' Settlement Counsel mean the following
attorneys:
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇
Stoll ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ P.C.
▇▇▇ ▇.▇. ▇▇▇ ▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
503/ 227-1600
and
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇, LLP.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
619/ 231-1058
(k) Person shall mean any individual, sole proprietorship,
partnership, limited liability company, joint venture, trust, incorporated
organization, association, corporation, institution, public benefit corporation,
entity or government (whether federal, state, county, city, municipal or
otherwise, including, without limited, any instrumentality, division, agency,
body or department thereof).
Article VII
Provisions Concerning the Warrant Agent and Other Matters
Section 7.1 Payment of Taxes and Charges. The Company will from time to
time promptly pay to the Warrant Agent, or make provisions satisfactory to the
Warrant Agent for the payment of, all taxes required to be paid by the Company
under Section 2.7 in connection with the issuance or delivery of any Warrant
Shares.
Section 7.2 Resignation or Removal of Warrant Agent. The Warrant Agent
may resign its duties and be discharged from all further duties and liabilities
hereunder after giving at least forty-five (45) calendar days' notice in writing
to the Company, except that such shorter notice may be given as the Company
shall, in writing, accept as sufficient. Upon comparable notice to the Warrant
Agent, the Company may remove the Warrant Agent; provided, however, that in such
event the Company shall appoint a new Warrant Agent, as provided below, and the
removal of the Warrant Agent shall not be effective until a new Warrant Agent
has been
18
appointed and has accepted such appointment. If the office of Warrant Agent
becomes vacant by resignation or incapacity to act or otherwise, the Company
shall appoint in writing a new Warrant Agent. If the Company shall fail to make
such appointment within a period of thirty (30) calendar days after it has been
notified in writing of such resignation or incapacity by the resigning or
incapacitated Warrant Agent or by the Holder of any Warrant Certificate, then
the Warrant Agent or the Holder of any Warrant Certificate may apply to any
court of competent jurisdiction for the appointment of a new Warrant Agent. Any
new Warrant Agent, whether appointed by the Company or by such a court, shall be
a bank or trust company having capital and surplus, as shown by its last
published report to its stockholders, of not less than $10,000,000 or a stock
transfer company doing business in the State of New York and/or the State of
California. Any new Warrant Agent appointed hereunder shall execute, acknowledge
and deliver to the former Warrant Agent last in office, and to the Company, an
instrument accepting such appointment under substantially the same terms and
conditions as are contained herein, and thereupon such new Warrant Agent without
any further act or deed shall become vested with the rights, powers, duties and
responsibilities of the Warrant Agent and the former Warrant Agent shall cease
to be the Warrant Agent; but if for any reason it becomes necessary or expedient
to have the former Warrant Agent execute and deliver any further assurance,
conveyance, act or deed, the same shall be done at the expense of the Company
and shall be legally and validly executed and delivered by the former Warrant
Agent.
Section 7.3 Notice of Appointment. The Warrant Agent currently acts as
transfer agent for the Common Stock. Forthwith upon the appointment of any
subsequent transfer agent for the Common Stock, of any other shares of the
Company's capital stock issuable upon exercise of the Warrant, the Company will
file with the Warrant Agent a statement setting forth the name and address of
such subsequent transfer agent. Forthwith upon the appointment of any successor
Warrant Agent, the Company will notify the Holders of the name and address of
such successor Warrant Agent.
Section 7.4 Merger of Warrant Agent. Any company into which the Warrant
Agent may be merged or with which it may be consolidated or any company
resulting from any merger or consolidation to which the Warrant Agent shall be a
party, or any Company to which the Warrant Agent may transfer its shareholder
services business shall be the successor Warrant Agent under this Agreement
without further act, provided that such company would be eligible for
appointment as a successor Warrant Agent under the provisions of Section 7.2
hereof. Any such successor Warrant Agent may adopt the prior countersignature of
any predecessor Warrant Agent and distribute Warrant Certificates countersigned
but not distributed by such predecessor Warrant Agent, or may countersign the
Warrant Certificates in its own name.
Section 7.5 Company Responsibilities. The Company agrees that it shall
(i) pay the Warrant Agent reasonable remuneration for its services as Warrant
Agent hereunder and will reimburse the Warrant Agent upon demand for all
expenses, advances, and expenditures that the Warrant Agent may reasonably incur
in the execution of its duties under this agreement (including reasonable fees
and expenses of its counsel); (ii) provide the Warrant Agent, upon
19
request, with sufficient funds to pay any cash due pursuant to Section 3.4(c) in
respect of the Warrants; and (iii) perform, execute, acknowledge and deliver or
cause to be performed, executed, acknowledged and delivered all further and
other acts, instruments and assurances as may reasonably be required by the
Warrant Agent for the carrying out or performing by the Warrant Agent of the
provisions of this Agreement.
Section 7.6 Use of Attorneys, Agents and Employees. The Warrant Agent
may execute and exercise any of the rights or powers hereby vested in it or
perform any duty hereunder either itself or by or through its attorneys, agents
or employees.
Section 7.7 Indemnification. The Company agrees to indemnify the
Warrant Agent and save it harmless against any and all losses, expenses or
liabilities, including judgments, costs and reasonable counsel fees arising out
of or in connection with its acceptance of its position hereunder and in
carrying out the terms hereof, except as a result of the negligence, bad faith
or willful misconduct of the Warrant Agent.
Section 7.8 Acceptance of Agency. The Warrant Agent hereby accepts the
agency established by this Agreement and agrees to act hereunder solely as agent
for the Company and its duties are only such duties as are specifically set
forth in this agreement.
Section 7.9 Instructions from the Company. The Warrant Agent is hereby
authorized and directed to accept instructions with respect to the performance
of its duties hereunder from the Chairman of the Board, the President, a Vice-
President, the Secretary or the Treasurer of the Company, and to apply to such
officers for advice or instructions in connection with its duties, and shall not
be liable for any action taken or suffered to be taken by it in good faith in
accordance with instructions of any such officer or officers.
Section 7.10 Assignment. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Warrant Agent shall bind
and inure to the benefit of their respective successors and assigns.
Section 7.11 Disposition of Proceeds From Exercise of Warrants. The
Warrant Agent shall account promptly to the Company with respect to Warrants
exercised and concurrently pay to the Company all moneys received by the Warrant
Agent on the purchase of Warrant Shares through the exercise of Warrants. Such
payment may be made by wire transfer or by certified check, cashier's check or
money order.
Section 7.12 Notices. Any notice or demand required by this Agreement
to be given or made by the Warrant Agent or by the Holder to or on the Company
shall be sufficiently given or made if sent by first-class or registered mail,
postage prepaid, addressed (until another address is filed in writing by the
Company with the Warrant Agent) as follows:
Imperial Credit Industries, Inc.
20
23550 Hawthorne ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Attention: Corporate Secretary
Any notice or demand required by this Agreement to be given or made by the
Holder of any Warrant Certificate or by the Company to or on the Warrant Agent
shall be sufficiently given or made if sent by first-class or registered mail,
postage prepaid, addressed (until another address is filed in writing with the
Company by the Warrant Agent), as follows:
U.S. Stock Transfer Corporation
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Any notice or demand required by this Agreement to be given or made by the
Company or the Warrant Agent to or on the Holder of any Warrant Certificate
shall be sufficiently given or made, if sent by first class or registered mail,
postage prepaid, addressed to such Holder at his last address as shown on the
books of the Company maintained by the Warrant Agent.
Each party hereto may from time to time change the address to which
notices to it are to be delivered or mailed hereunder by notice in writing to
the other party.
Section 7.13 Defects in Notice. Failure to file any certificate or
notice or to mail any notice, or any defect in any certificate or notice
pursuant to this Agreement shall not affect in any way the rights of any Holder
or the legality or validity of any adjustment made pursuant to Section 3.1 here,
or any transaction giving rise to any such adjustment, or the legality or
validity of any action taken or to be taken by the Company.
Section 7.14 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA, WITHOUT GIVING
EFFECT TO PRINCIPLES OF CONFLICT OF LAWS, THE PARTIES HERETO AGREE TO SUBMIT TO
THE JURISDICTION OF THE COURTS OF THE STATE OF CALIFORNIA IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.
Section 7.15 Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company, the Warrant Agent or the Holders
of the Warrants shall bind and inure to the benefit of their respective
successors and assigns hereunder.
Section 7.16 Standing. Nothing in this Agreement expressed and nothing
that may be implied from any of the provisions herein is intended, or shall be
construed, to confer upon, or give to, any person or corporation other than the
Company, the Warrant Agent, and the Holders
21
any right, remedy or claim under or by reason of this Agreement or of any
covenant, condition, stipulation, promise or agreement contained here; and all
covenants, conditions, stipulations, promises and agreements contained in this
Agreement shall be for the sole and exclusive benefit of the Company and the
Warrant Agent and their successors, and the Holders.
Section 7.17 Headings. The descriptive headings of the articles and
sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.
Section 7.18 Benefits of this Agreement. Nothing in this Agreement
shall be construed to give to any Person other than the Company, the Warrant
Agent and the Holders of the Warrants, any legal or equitable right, remedy or
claim under this Agreement, but this Agreement shall be for the sole and
exclusive benefit of the Company, the Warrant Agent and the Holders.
Section 7.19 Counterparts. This Agreement may be executed in any number
of counterparts, each of which so executed shall be deemed to be an original;
but such counterparts shall together constitute but one and the same instrument.
Section 7.20 Availability of the Agreement. The Warrant Agent shall
keep copies of this Agreement available for inspection by holders of Warrants
during normal business hours at its stock transfer department. Copies of this
Agreement may be obtained upon written request addressed to:
U.S. Stock Transfer Corporation
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Section 7.21 Supplements and Amendments. The Company and the Warrant
Agent may from time to time supplement or amend this Agreement without the
approval of any Holders of Warrant Certificates in order to cure any ambiguity
or to correct or supplement any provision contained herein which may be
defective or inconsistent with any other provision herein, or to make any other
provisions in regard to matters or questions arising hereunder which the Company
and the Warrant Agent may deem necessary or desirable and which shall not
adversely affect in any way the interests of the Holders of the Warrant
Certificates. The Company agrees to provide Plaintiffs' Settlement Counsel with
a copy of any supplement or amendment to this Agreement made pursuant to this
Section 7.21 (and, if such supplement or amendment consists of a restatement of
this entire Agreement, a comparative copy of such supplement or amendment
highlighting the changes thereby made to this Agreement) promptly after any such
supplement or amendment is executed.
22
Section 7.22 Termination. This Agreement shall terminate when all the
Warrants outstanding hereunder shall have been exercised, expired or redeemed
and the Warrant Agent shall have fulfilled all its obligations hereunder.
23
IN WITNESS OF, the parties to this Agreement have caused this Agreement
to be duly executed, and their corporate seals affixed and attested, all as of
the day and year first above written.
IMPERIAL CREDIT INDUSTRIES, INC.
By: /s/ H. ▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------
Name: H. ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Chairman
Attest:
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: General Counsel and Secretary
U.S. STOCK TRANSFER CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Assistance Vice President
Attest: ______
By: _________________
Name:
Title:
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇▇, P.C.
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇, OSB ▇▇. ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇ No. 94066
(▇▇▇) ▇▇▇-▇▇▇▇
Liaison Counsel for Plaintiffs ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Co-Lead Counsel for Plaintiffs Art ▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ &
BARRACK, RODOS & BACINE LERACH LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: 619/▇▇▇-▇▇▇▇ Telephone: 619/▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
LAW OFFICES OF ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
S. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ &
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, P.C.
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
Telephone: 212/▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: 215/▇▇▇-▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, P.C. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
Telephone: 215/▇▇▇-▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Telephone: 212/▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Jordan ▇. ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ LLP ▇▇▇▇▇ & ▇▇▇▇▇▇▇
1285 Avenue of the Americas, 33rd Floor ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: 212/▇▇▇-▇▇▇▇ Telephone: 310/▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇. Toll
▇▇▇▇▇▇▇ ▇. ▇▇▇
COHEN, MILSTEIN, HAUSFELD
& TOLL, P.L.L.C.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: 206/▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇▇▇ ▇.▇. ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Telephone: 503/▇▇▇-▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
LAW OFFICES OF ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: 201/▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
1800 One Main Place
▇▇▇ ▇.▇. ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: 503/▇▇▇-▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: 212/▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
LEVIN, FISHBEIN, SEDRAN &
▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: 215/▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
AND ▇▇▇▇▇▇ LLP
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: 312/▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ BLOCK
▇▇▇▇▇▇▇▇ & GROSS LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Telephone: 212/▇▇▇-▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇
▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: 212/▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
WECHSLER ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
& FEFFER LLP
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: 212/▇▇▇-▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
WOLF POPPER LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: 212/▇▇▇-▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: 215/▇▇▇-▇▇▇▇
▇▇▇ ▇. ▇▇▇▇▇
LIEBENBERG & WHITE
▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: 215/▇▇▇-▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇
LAW OFFICES OF ▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: 212/▇▇▇-▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: 210/▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
LAW OFFICES OF ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: 802/▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
BEATIE AND ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: 212/▇▇▇-▇▇▇▇
Attorneys for Plaintiffs
Exhibits:
---------
Exhibit A - Form of Warrant Certificate
Exhibit B - Purchase Form
EXHIBIT A
Form of Warrant Certificate
No._____ _________Shares
COMMON STOCK PURCHASE WARRANT
Void After 5:00 P.M., Los Angeles, California time
at _______________________ on ____________________, 200__
THIS CERTIFIES THAT, for value received, ____________________, the
registered holder (the "Holder") of this Common Stock Purchase Warrant (the
"Warrant") or registered assigns, is entitled to purchase from
___________________________________ (the "Company"), at any time until 5:00 p.m.
at ______________________ on ________________, ________ (the "Expiration Date"),
at the Exercise Price of $3.00 per share (the "Exercise Price").
________________________ shares (_____shares) of the Common Stock of the Company
(the "Common Stock"). The number of shares purchasable upon exercise of this
Warrant and the Exercise Price per share shall be subject to adjustment from
time to time as set forth in the Warrant Agreement referred to below.
This Warrant is issued under and in accordance with a Warrant
Agreement, dated as of ____________, 2000, between the Company and the Warrant
Agent and for the benefit of the Holders and is subject to the terms and
provisions contained in the Warrant Agreement, to all of which the Holder of
this Warrant by acceptance hereof consents. A copy of the Warrant Agreement may
be obtained for inspection by the Holder hereof upon written request to the
Company.
This Warrant may be exercised in whole or in part by presentation of
this Warrant with the Purchase Form on the reverse side hereof duly executed and
simultaneous payment of the Exercise Price (subject to adjustment) at the
principal office of __________________________, as the Warrant Agent, in
_____________________. Payment of such price shall be payable at the option of
the Holder hereof in cash or by certified or official bank check or wire
transfer. Terms relating to exercise of the Warrant are set forth more fully in
the Warrant Agreement.
This Warrant may be exercised in whole or in part. Upon partial
exercise, a Warrant Certificate for the unexercised portion shall be delivered
to the Holder. No fractional shares will be issued upon the exercise of this
Warrant, nor shall the Company be obligated to issue scrip or pay cash in lieu
of fractional interests, but any fraction equal to or greater than one-half
shall be rounded up to the next full Warrant Share or Warrant, as the case may
be, and any fraction less than one-half shall be eliminated. This Warrant is
transferable as described in the Warrant Agreement at the office of the Warrant
Agent, in the manner and subject to the limitations set forth in the Warrant
Agreement.
The Holder hereof may be treated by the Company, the Warrant Agent and
all other Persons dealing with this Warrant as the absolute owner hereof for any
purpose and as the person entitled to exercise the rights represented hereby, or
to the transfer hereof on the Warrant Register maintained by the Warrant Agent
for the Company. Any notice to the contrary notwithstanding, and until such
transfer on such Warrant Register, the Company and the Warrant Agent may treat
the Holder hereof as the owner for all purposes.
This Warrant does not entitle any Holder hereof to any of the rights of
a stockholder of the Company.
This Warrant shall not be valid for any purpose until countersigned by
the Warrant Agent by manual signature of one of its authorized officers below.
IMPERIAL CREDIT INDUSTRIES, INC.
By: ________________________________
Name:
Title:
COUNTERSIGNED AND DATED:
DATED: _____________________
________________________________________
as Warrant Agent
By: ____________________________________
Authorized Officer
EXHIBIT B
PURCHASE FORM
The undersigned hereby irrevocably elects to exercise the right of
purchase represented by the within Warrant for, and to purchase thereunder,
______________________ shares of the stock provided for therein, and tenders
herewith payment of the Exercise Price in full in the form of cash or by
certified check, cashier's check or money order in the amount of
$________________, payable in United States currency to the order of the
Company. (In the case of any partial exercise of this Warrant, the exercise
shall be for a whole number of Warrant Shares only.)
The undersigned requests that certificates for such shares be issued in
the name of:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please Print Name, Address and Social Security No.)
DATED: __________________________
Name of Holder or Permitted Assignee:
______________________________________________________________________________
Address:
______________________________________________________________________________
______________________________________________________________________________
Signature: ___________________________________________________________________
Note: The above signature must correspond with the name as written upon the
face of this Warrant Certificate in every particular, without
alteration or enlargement or any change whatever.
Signature Guaranteed by: _________________________________________________
TABLE OF CONTENTS
Article I - Warrant Certificates..................................................................................1
Section 1.1 Appointment of Warrant Agent. ...............................................1
Section 1.2 Form of Warrant Certificates..................................................1
Section 1.3 Execution of Warrant Certificates.............................................2
Section 1.4 Registration..................................................................2
Section 1.5 Warrant Records...............................................................3
Section 1.6 Transferability...............................................................3
Section 1.7 Compliance with Government Regulations; Market Maker..........................3
Section 1.8 Legal Opinion.................................................................4
Article II - Warrant Exercise Price and Exercise of Warrants......................................................4
Section 2.1 Exercise Price................................................................4
Section 2.2 Vesting of the Warrants.......................................................5
Section 2.3 Exercisability of Warrants....................................................5
Section 2.4 Continuing Effectiveness of Registration of Warrant Shares....................5
Section 2.5 Procedure for Exercise of Warrants............................................6
Section 2.6 Issuance of Warrant Shares....................................................6
Section 2.7 Payment of Taxes and Costs....................................................7
Section 2.8 Certificates for Unexercised Warrants.........................................7
Section 2.9 Reservation of Shares.........................................................7
Section 2.10 Lost, Stolen, Mutilated or Destroyed Warrant Certificates.....................8
Section 2.11 Warrant Redemption Price......................................................8
Article III - Adjustments, Redemption, Notice Provisions and Other Agreements.....................................8
Section 3.1 Adjustment of Exercise Price..................................................8
Section 3.2 No Adjustments to Exercise Price.............................................10
Section 3.3 Adjustment to Number of Shares...............................................10
Section 3.4 Reorganizations; Change of Control; Going
Private Transactions. .....................................................10
Section 3.5 Certain Mergers or Consolidations. .........................................13
Section 3.6 Holders of Warrant Certificates Not Deemed Shareholders......................13
Section 3.7 Verification of Computations.................................................13
Section 3.8 Notice of Adjustments........................................................14
Section 3.9 Deferral of Issuance of Warrant Shares.......................................14
Section 3.10 Warrant Certificate Amendments...............................................14
Section 3.11 Listing of Warrant Shares....................................................15
Section 3.12 Independent Application......................................................15
Article IV - Split Up, Combination, Exchange, Transfer and Cancellation of
Warrant Certificates....................................................................................15
-i-
TABLE OF CONTENTS
Section 4.1 Split Up, Combination, Exchange and Transfer
of Warrant Certificates...............................................................15
Section 4.2 Cancellation of Warrant Certificates..................................................15
Article V - Representations and Warranties of the Company.......................................................16
Section 5.1 Due Authority................................................................16
Section 5.2 Consents and Approvals.......................................................16
Article VI - Certain Definitions.................................................................................16
Article VII - Provisions Concerning the Warrant Agent and Other Matters..........................................18
Section 7.1 Payment of Taxes and Charges.................................................18
Section 7.2 Resignation or Removal of Warrant Agent......................................18
Section 7.3 Notice of Appointment........................................................19
Section 7.4 Merger of Warrant Agent......................................................19
Section 7.5 Company Responsibilities.....................................................19
Section 7.6 Use of Attorneys, Agents and Employees.......................................19
Section 7.7 Indemnification..............................................................19
Section 7.8 Acceptance of Agency.........................................................20
Section 7.9 Instructions from the Company. ..............................................20
Section 7.10 Assignment...................................................................20
Section 7.11 Disposition of Proceeds From Exercise of Warrants............................20
Section 7.12 Notices. ....................................................................20
Section 7.13 Defects in Notice............................................................21
Section 7.14 Governing Law................................................................21
Section 7.15 Successors...................................................................21
Section 7.16 Standing.....................................................................21
Section 7.17 Headings.....................................................................21
Section 7.18 Benefits of this Agreement...................................................21
Section 7.19 Counterparts.................................................................21
Section 7.21 Supplements and Amendments...................................................22
Section 7.22 Termination..................................................................22
-ii-
