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EXHIBIT 4.9
WARRANT
Warrant No. 3
THIS WARRANT AND THE WARRANT SHARES HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, NOR REGISTERED OR
QUALIFIED UNDER ANY STATE SECURITIES LAWS, AND MAY NOT BE
PLEDGED, HYPOTHECATED, SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF
UNLESS SO REGISTERED OR AN EXEMPTION THEREFROM IS AVAILABLE
WARRANT TO PURCHASE COMMON STOCK
OF
CMG FUNDING CORP.
THIS CERTIFIES THAT, for value received CONTITRADE SERVICES
L.L.C., the holder of this Warrant or its registered successors and assigns (the
"Holder"), is entitled to purchase from CMG Funding Corp., a Delaware
corporation (the "Company"), at the purchase price of $1 the number of shares of
common stock of the Company ("Common Stock"), that will equal, immediately after
the exercise of this Warrant, the percentage of the total equity of the Company
on a fully diluted basis equal to the value of the entitlement (described more
fully in Section 1 hereof) (the "Entitlement") as of the date of the exercise of
this Warrant.
SECTION 1. PRE-TAX NET INCOME TARGET ADJUSTMENT. Schedule A hereto sets
forth a list of after tax net income targets for the Company on a quarterly
basis (each a "PTNI Target" for the respective quarter). (Each PTNI Target has
been determined prior to the deduction of all costs and expenses of the REIT
Issuance (as defined in "Amendment 2 to Letter Agreement referred to as the
Investment Banking Services Agreement", dated as of December 31, 1997 among the
Company, the Holder and ContiFinancial Services Corporation)). To the extent
that upon the closure of any quarter as to which a PTNI Target is listed on
Schedule A, the after tax net income of the Company for such quarter, determined
in accordance with GAAP, is less than ninety (90%) percent of the PTNI Target
for such quarter, then 1.00% shall be added to the Entitlement for each such
event. Initially as of December 31, 1997, the Entitlement shall equal zero.
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SECTION 2. TERM OF WARRANT, RESTRICTIONS ON TRANSFER, EXERCISE OF
WARRANT.
2.1 TERM OF WARRANT. Subject to the terms of this Warrant, the Holder
shall have the right, at its option, which may be exercised in whole, or in
part, at any time during the period prior to the earlier to occur of (i) January
1, 1999 and (ii) the date on which the Company receives the proceeds of the REIT
Issuance (such period, the "Exercise Period"), to purchase from the Company the
number of fully paid and nonassessable shares of the Common Stock of the Company
which the Holder may at the time be entitled to purchase on exercise of this
Warrant ("Warrant Shares"). After such time, this Warrant will be void. The
Company shall notify the Holder in writing, not less than 30 days nor more than
60 days prior to the expiration of the Exercise Period, of the last date on
which this Warrant is exercisable.
2.2 RESTRICTIONS ON TRANSFER. This Warrant and the Warrant Shares are
restricted securities as defined under the Securities Act of 1933, as amended
(the "Act") and therefore are non-transferable except in compliance with
applicable federal and state securities laws, including Rule 144 adopted under
the Act. Unless Warrant Shares shall have been duly registered under the Act,
certificates representing such shares shall bear a legend comparable to the
legend on the first page of this Warrant regarding restrictions on transfer.
Unless the transfer restrictions have been terminated pursuant to Section 9
hereof, the Holder agrees to give written notice to the Company before offering
for sale, selling or otherwise disposing of any of the Warrant or the Warrant
Shares, except when such offer, sale or other disposition is made pursuant to a
registration statement then in effect under the Act. The notice shall describe
briefly the manner of any proposed offer, sale or other disposition and shall be
accompanied by a written opinion of counsel for the Holder, which counsel shall
be a firm generally recognized as knowledgeable in the securities laws, to the
effect that the proposed offer, sale or other disposition of such Warrant or
Warrant Shares may be effected without registration under the Act. In addition
the Holder shall not sell or transfer any of the Warrant or the Warrant Shares
during any period occurring within 90 days after the effective date of a
registration statement relating to a public offering of the Company's shares of
Common Stock and in which public offering the Holder is participating.
2.3 EXERCISE OF WARRANT. This Warrant may be exercised in whole or in
part upon surrender hereof to the Company at its principal office, together with
the Notice of Exercise Form attached hereto as Exhibit A duly filled in and
signed, and upon payment to the Company of the portion of the Warrant Price
equal to the percentage of the Warrant Shares specified in the Notice of
Exercise compared to the total amount of Warrant Shares to which this Warrant
entitles the Holder to purchase.
Subject to Section 2.2 and to Section 4 hereof, upon such
surrender of this Warrant and payment of the Warrant Price, the Company shall
issue and cause to be delivered with all reasonable dispatch 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 this Warrant, in whole or in part. Such
certificate or certificates shall be deemed to have been issued and any
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person so designated to be named therein shall be deemed to have become a holder
of record of such Warrant Shares as of the date of the surrender of this Warrant
and payment of the portion of Warrant Price equal to the percentage of the
Warrant Shares specified in the Notice of Exercise compared to the total amount
of Warrant Shares to which this Warrant entitles the Holder to purchase.
If this Warrant is exercised in part only, the Company shall,
upon surrender of this Warrant for cancellation, deliver a new Warrant
evidencing the rights of the Holder or its permitted designees to purchase the
balance of the Warrant Shares which Holder is entitled to purchase hereunder.
If, as of the last day of the Exercise Period, this Warrant has
not been fully exercised, then as of such date this Warrant shall be
automatically converted in full, in accordance with this Section 2.3, without
any notice or action of the Holder, unless the Holder sends written notice to
the contrary to the Company prior to the last day of the Exercise Period.
SECTION 3. EXCHANGE OF WARRANT. Subject to Section 2.2 and Section 4
hereof, this Warrant may be exchanged for another Warrant or Warrants entitling
the Holder, or any designated transferee or transferees of the Holder, to
purchase up to the aggregate percentage of Warrant Shares as this Warrant then
entitles such Holder to purchase. Any Holder desiring to exchange this Warrant
shall make such request in writing delivered to the Company, and shall surrender
this Warrant, properly endorsed. Thereupon the Company shall execute and deliver
to the person entitled thereto a new Warrant or Warrants, as the case may be, as
so requested.
SECTION 4. PAYMENT OF TAXES. The issuance of Warrant Shares upon
exercise of this Warrant shall be made without charge to the Holder for any
issuance tax with respect thereto or any other cost incurred by the Company in
connection with the exercise of this Warrant and the related issuance of Warrant
Shares.
SECTION 5. MUTILATED OR MISSING WARRANT. In case this Warrant shall be
mutilated, lost, stolen or destroyed, the Company shall issue in exchange and
substitution for and upon cancellation of the mutilated Warrant, or in lieu of
and substitution for the Warrant lost, stolen or destroyed, a new Warrant of
like tenor and representing an equivalent right or interest, but only upon
receipt of evidence reasonably satisfactory to the Company of such loss, theft
or destruction of this Warrant and indemnity (which may include a bond), if
requested, also reasonably satisfactory the Company; provided, however, that for
any Holder which is an affiliate of ContiTrade Services L.L.C., an affidavit of
loss and written agreement of indemnity shall suffice for such evidence and
indemnity.
SECTION 6. Certain Covenants.
6.1 RESERVATION OF WARRANT SHARES. There have been reserved, and the
Company shall at all times keep reserved, out of its authorized Common Stock, a
number of shares of Common Stock sufficient to provide for the exercise of the
rights of purchase represented by this Warrant. The transfer agent, if any, for
the Common Stock, and every subsequent transfer agent for any shares of the
Company's capital stock issuable upon the
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exercise of any of the rights of purchase as set out in this Warrant, will be
irrevocably authorized and directed at all times by the Company to reserve such
number of authorized shares as shall be requisite for such purpose. The Company
will keep a copy of this Warrant on file with any transfer agent for the Common
Stock and with every subsequent transfer agent for any shares of the Company's
capital stock issuable upon the exercise of the rights of purchase represented
by this Warrant. Any transfer agent for the Common Stock and any successor
transfer agent for the Common Stock is hereby irrevocably authorized to cause to
be issued from time to time the share certificates required to honor this
Warrant upon its exercise in accordance with the terms hereof.
6.2 NO IMPAIRMENT. The Company shall not by any action including,
without limitation, amending its Certificate of Incorporation, any
reorganization, transfer of assets, consolidation, merger, dissolution, issue or
sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of this Warrant, but will at all
times take all such action as may be necessary or appropriate to protect the
rights of the Holder against impairment. Without limiting the generality of the
foregoing, the Company will (a) not change the "stated value" of the Common
Stock to par value, (b) take all such action as may be necessary or appropriate
in order that the Company may validly issue fully paid and nonassessable Common
Stock upon the exercise of this Warrant and (c) obtain all authorizations,
exemptions or consents from any public regulatory body having jurisdiction
thereof as may be necessary to enable the Company to perform its obligations
under this Warrant.
Upon the request of the Holder, the Company will at any time during
the period this Warrant is outstanding acknowledge in writing, in form
satisfactory to the Holder, the continued validity of this Warrant and the
Company's obligations hereunder.
If at any time the Company shall issue any warrant with terms
more favorable to the holder thereof than the terms of this Warrant are to the
Holder, then the Company shall issue to the Holder a replacement warrant
containing such new favorable terms, provided that the other terms of the
replaced warrant shall not be changed in any manner which adversely affects the
Holder.
6.3 LISTING. If the Company shall list any of its Common Stock on any
securities exchange or automated quotation system, it will, at its expense, list
thereon, maintain and, when necessary, increase such listing of, all of its
Common Stock issued or, to the extent permissible under the applicable
securities exchange or quotation system rules, issuable upon the exercise of
this Warrant so long as any of its Common Stock shall be so listed.
6.4 STOCK TRANSFER RESTRICTIONS. During the term of this Warrant, the
Company shall not, without the prior written consent of the Holder, issue,
distribute, sell or transfer, or allow the issuance, distribution, sale or
transfer by the Company or by any affiliate of the Company, including, without
limitation, the controlling shareholders of the Company, the Company's capital
stock or securities other than (a) the sale of the Company's Common Stock to the
Holder occurring upon the exercise of the Warrant, (b) the sale of the Company's
capital stock pursuant to a firm commitment public offering, (c) the transfer of
the Company's capital stock for estate planning purposes or pursuant to
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a domestic relations settlement order, or (d) the transfer of the Company's
Common Stock pursuant to a buy/sell agreement solely among the Company's
existing shareholders.
SECTION 7. DISTRIBUTIONS ON STOCK. The Company shall not declare any
dividends or redeem any capital stock without the prior written consent of the
Holder.
SECTION 8. PRESERVATION OF PURCHASE RIGHTS UPON RECLASSIFICATION,
CONSOLIDATION, MERGER ETC. In case of any reclassification of the Common Stock
into securities other than the Common Stock, or any consolidation of the Company
with, or merger of the Company into, another person, or in case of any sale or
conveyance to another person of the property of the Company as an entirety or
substantially as an entirety, the Company or such successor or purchasing
person, as the case may be, shall execute with the Holder an agreement such that
the Holder at its option shall have the right thereafter, upon payment of the
Warrant Price in effect immediately prior to such reclassification,
consolidation, merger, sale or conveyance, upon exercise of this Warrant to
receive either (A) cash in an amount equal to the fair market value of the
Common Stock the Holder would have been entitled to receive had this Warrant
been exercised immediately prior to the consummation of such event or (B) the
kind and amount of shares and other securities and property which the Holder
would have owned or have been entitled to receive after the happening of such
reclassification, consolidation, merger, sale or conveyance had such Warrant
been exercised immediately prior to such event. Such agreement shall provide for
terms as nearly equivalent as may be practicable to the adjustments provided for
in this Warrant. The provisions of this Section 8 shall similarly apply to
successive reclassifications, consolidations, mergers, sales or conveyances.
SECTION 9. TERMINATION OF RESTRICTIONS. The restrictions imposed by
Section 2.2 hereof upon the transferability of any Warrant Shares shall cease
and terminate as to any Warrant Shares (a) when such securities shall have been
effectively registered under the Act and disposed of in accordance with the
registration statement covering such securities, or (b) when, in the opinions of
both counsel for the Holder and counsel for the Company, such restrictions are
no longer required in order to insure compliance with the Act. Whenever such
restrictions shall terminate as to any Warrant Shares the Holder shall be
entitled to receive from the Company, without expense, new securities of like
tenor not bearing a legend as to restrictions on transfer.
SECTION 10. NOTICES TO HOLDER. If at any time prior to the expiration of
this Warrant and prior to its exercise, any of the following events shall occur:
(a) the Company shall declare any dividend payable in any
securities upon its stock or make any distribution to the holders of its stock;
or
(b) the Company shall offer to the holders of its stock any
additional stock or securities convertible into stock or any right to subscribe
thereto; or
(c) a reclassification, consolidation, merger or sale or all or
substantially all of the Company's property, assets and business as an entirety
or a dissolution, liquidation or winding up of the Company shall be proposed;
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then in any one or more of such events, the Company shall give notice in writing
of such event to the Holder at least 20 days prior to the date fixed as a record
date for the determination of the shareholders entitled to such dividend,
distribution or subscription rights, or for the determination of shareholders
entitled to vote on such proposed reclassification, consolidation, merger, sale,
dissolution, liquidation or winding up. Such notice shall specify such record
date.
SECTION 11. Representations and Warranties.
11.1 REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to Holder as follows:
(a) The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware, and has
full power and lawful authority to carry on its business;
(b) The Company has the full corporate power to execute, deliver
and issue this Warrant and to carry out its obligations hereunder; the
execution, delivery and issuance of this Warrant, and delivery and issuance of
Warrant Shares upon exercise of this Warrant, have been duly and validly
authorized by the Board of Directors of the Company; no other corporate acts or
proceedings on the part of the Company are necessary to authorize this Warrant
or the Warrant Shares; and this Warrant constitutes a valid and legally binding
obligation of the Company, enforceable against the Company in accordance with
its terms;
(c) The Warrant Shares will, when issued pursuant to this
Warrant, be duly authorized and validly issued, fully paid and nonassessable,
and not subject to preemptive rights;
(d) No consent or approval by, or filing with, any governmental
authority is required in connection with the execution, delivery and issuance by
the Company of this Warrant or the delivery and issuance of the Warrant Shares
other than such as have been obtained or made (or as may be required in the
future under applicable securities laws in connection with the transfer or
exercise of this Warrant or the resale of the Warrant Shares); and
(e) The execution, delivery, issuance of this Warrant and the
delivery and issuance of the Warrant Shares will not result in the violation of
any term or provision of the charter or by-laws of the Company or any loan
agreement, indenture, note or other instrument, or decree, order, statute, rule
or regulation applicable to the Company.
11.2 REPRESENTATIONS AND WARRANTIES OF THE HOLDER. The Holder hereby
represents and warrants that:
(a) It is acquiring this Warrant, for its own account and not
with a view to, or for sale in connection with, any distribution of the Warrant.
(b) As of the date of exercise of any portion of this Warrant, it
is acquiring the Warrant Shares, for its own account and not with a view to, or
for sale in
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connection with, any distribution of such Warrant Shares, unless it is
exercising this Warrant in connection with a public offering of the related
Warrant Shares.
SECTION 12. NOTICES. Any notice pursuant to this Warrant by the Company
or by the Holder shall be in writing and shall be mailed first class, postage
prepaid, or delivered (a) to the Company, at its principal office at ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ or (b) to the Holder,
to ContiTrade Services, L.L.C., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇.▇. ▇▇▇▇▇,
Attention: Chief Counsel. Either party may from time to time change the address
to which notices to it are to be delivered or mailed under this Warrant by
notice in writing to the other party.
SECTION 13. MISCELLANEOUS.
13.1 MAINTENANCE OF EXISTENCE OF THE COMPANY. The Company will keep in
full effect its existence, rights and franchises as a corporation under the laws
of the state of its formation except as permitted herein, and will obtain and
preserve its qualification to do business as a foreign corporation in each
jurisdiction in which such qualification is or shall be necessary to protect the
validity and enforceability of this Warrant and to perform its duties under this
Warrant.
13.2 COSTS. All costs and expenses incurred in connection with the
transfer of the Common Stock of the Company to the Holder, including any legal
expenses in connection with the enforcement of the Holder's rights hereunder,
shall be borne by the Company.
13.3 PROTECTION OF CONFIDENTIAL INFORMATION. The Holder and the Company
shall keep confidential and shall not divulge to any party, without each other's
prior written consent, any of the terms of this Warrant, except to the extent
that it is appropriate for the parties hereto to do so in working with legal
counsel, auditors, taxing authorities or other governmental agencies or pursuant
to any applicable law, rule or regulation of a governmental authority or agency.
13.4 ENTIRE WARRANT. This Warrant, including the Exhibits hereto,
contains the entire agreement of the parties with respect to the subject matter
hereto, and supersedes all prior agreements between them, whether oral or
written, of any nature whatsoever with respect to the subject matter hereof.
13.5 SEVERABILITY CLAUSE. Any part or provision of this Warrant that is
prohibited or that is held to be void or unenforceable shall be ineffective to
the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof. Any part or provision of this Warrant that is
prohibited or unenforceable or is held to be void or unenforceable in any
jurisdiction shall be ineffective, as to such jurisdiction, to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. To the extent permitted by applicable law, the parties
hereto waive any provision of law that prohibits or renders void or
unenforceable any provision hereof. If the invalidity of any part or provision
of this Warrant shall deprive the Holder of the economic benefit intended to be
conferred by this Warrant, the Company and the Holder shall negotiate, in
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good-faith, to develop a structure, the economic effect of which is as close as
possible to the economic effect of this Warrant, without regard to such
invalidity.
13.6 GOVERNING LAW; CONSENT TO FORUM; IMMUNITIES. This Warrant has been
negotiated, executed and delivered at and shall be deemed to have been made in
New York, New York. This Warrant shall be governed by and construed in
accordance with the laws of the State of New York without giving effect to the
conflict of laws rules therein. The Company hereby consents and agrees that the
Supreme Court of New York County, New York or, at the Holder's option, the
United States District Court for the Southern District of New York, shall have
exclusive jurisdiction to hear and determine any claims or disputes pertaining
to this Warrant or to any matter arising out of or related to this Warrant. The
Company expressly submits and consents in advance to such jurisdiction in any
action or suit commenced in any such court, and hereby waives any objection
which it may have based upon lack of personal jurisdiction, improper venue or
forum non conveniens and hereby consents to the granting for such legal or
equitable relief as is deemed appropriate by such court. The Company irrevocably
consents to the service of process by registered or certified mail, postage
prepaid, to it at its address given pursuant to Section 12 hereof. Nothing in
this Warrant shall be deemed or operate to affect the right of the Holder to
serve legal process in any other manner permitted by law, or to preclude the
enforcement by the Holder of any judgement or order obtained in such forum or
the taking of any action under this Warrant to enforce same in any other
appropriate forum or jurisdiction.
To the extent that the Company has or may hereafter acquire any
immunity from the jurisdiction of any court or from any legal process (whether
through service or notice, attachment prior to judgement, attachment in aid of
execution, execution or otherwise) with respect to the Company or the Company's
property, the Company hereby irrevocably waives such immunity in respect of
their respective obligations under this Warrant.
13.7 WAIVER OF TRIAL BY JURY. Each party hereto waives the right to
trial by jury in any action, suit, proceeding or counterclaim of any kind
arising out of or related to this Warrant. In the event of litigation, this
Warrant may be filed as a written consent to a trial by the court.
13.8 FURTHER AGREEMENTS. The Company agrees to execute and deliver to
the Holder such additional documents, instruments or agreements as may be
necessary or appropriate to effectuate the purposes of this Warrant.
13.9 AMENDMENT; WAIVERS. This Warrant may be amended from time to time
only by written agreement of the Company and the Holder. No failure on the part
of the Holder to exercise, and no delay in exercising, any right, power, or
remedy under this Warrant shall operate as a waiver thereof; nor shall any
single or partial exercise of any right under this Warrant preclude any other or
further exercise thereof or the exercise of any other right. No term or
provision of this Warrant may be waived or modified unless such waiver or
modification is in writing and signed by the party against whom such waiver or
modification is sought to be enforced.
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13.10 THIRD-PARTY RIGHTS; ASSIGNMENT. This Warrant is for the exclusive
benefit of the Holder and its successors and assigns and shall not be deemed to
give any legal or equitable right to any other person. Unless otherwise agreed
to by the Company, this Warrant may only be assigned by the Holder to its
Affiliates.
13.11 REPRODUCTION OF DOCUMENTS. This Warrant and all documents relating
thereto, including, without limitation, (a) consents, waivers and modifications
which may hereafter be executed, (b) documents received by any party at the
closing, and (c) financial statements, certificates and other information
previously or hereafter furnished, may be reproduced by any photographic,
photostatic, microfilm, micro-card, miniature photographic or other similar
process. The parties agree that any such reproduction shall be admissible in
evidence as the original itself in any judicial or administrative proceeding,
whether or not the original is in existence and whether or not such reproduction
was made by a party in the regular course of business, and that any enlargement,
facsimile or further reproduction of such reproduction shall likewise be
admissible in evidence.
13.12 ADVICE FROM INDEPENDENT COUNSEL. The parties hereto understand
that this Warrant is a legally binding agreement that may affect such party's
rights. Each party represents to the other that it has received legal advice
from counsel of its choice regarding the meaning and legal significance of this
Warrant and that it is satisfied with its legal counsel and the advice received
from it.
13.13 NO AGENCY; NO PARTNERSHIP; NO JOINT VENTURE. Neither the Holder
nor the Company are the agent or representative of the other, and nothing in
this Warrant shall be construed to make either the Holder or the Company liable
to any third party for services performed by such third party or for debts or
claims accruing to such third party against either the Holder or the Company.
Nothing contained herein nor the acts of the Company and the Holder shall be
construed to create a partnership, agency or joint venture between the Holder
and the Company.
13.14 Judicial Interpretation. Should any provision of this Warrant
require judicial interpretation, it is agreed that a court interpreting or
construing the same shall not apply a presumption that the terms hereof shall be
more strictly construed against any party by reason of the rule of construction
that a document is to be construed more strictly against the party who itself or
through its agent prepared the same, it being agreed that both the Company and
the Holder have participated in the preparation of this Warrant.
13.15 SUMMARY JUDGMENT. The Company hereby acknowledges and agrees that
any enforcement action relating to this Warrant or any Warrant Shares may be
brought by motion for summary judgment in lieu of a complaint pursuant to
Section 3212 of the New York Civil Practice Law and Rules.
SECTION 14. RULES OF INTERPRETATION. Except as otherwise expressly
provided in this Warrant, the following rules shall apply hereto: (a) the
singular includes the plural and the plural includes the singular; (b) "or" is
not exclusive and "include" and "including" are not limiting; (c) a reference to
any agreement or other contract includes permitted supplements, amendments and
other modifications; (d) a reference to a law
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includes any amendment or modification of such law and the rules or regulations
issued thereunder; (e) a reference to a party includes its permitted successors
and assigns in the applicable capacity; (f) a reference in this Warrant to a
Section, clause, recital or Exhibit is to the Section, clause, recital or
Exhibit of this Warrant unless otherwise expressly provided; (g) words such as
"hereunder", "hereto", "hereof", and "herein" and other words of like import
shall, unless the context clearly indicates to the contrary, refer to the whole
of this Warrant and not to any particular Section or clause hereof; (h) all
obligations under this Warrant are continuing obligations throughout the term of
this Warrant; (i) any right in this Warrant may be exercised at any time and
from time to time; (j) the headings of the Sections and the Subsections are for
convenience and shall not affect the meaning of this Warrant; and (k) time is of
the essence in performing all obligations.
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IN WITNESS WHEREOF, the undersigned have executed this Warrant as
of the 31st day of December, 1997.
CMG FUNDING CORP.
By:
---------------------------------
Name:
Title:
Attest:
-----------------------------
Name:
Title:
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ASSIGNMENT
[To be signed only upon assignment of Warrant]
FOR VALUE RECEIVED, the undersigned sells, assigns and transfers unto
(Name of Assignee Must be Printed or Typewritten)
(Street Address)
(City, State and Zip Code)
the within Warrant [or if partial assignment is being made, indicate
percentage], irrevocably constituting and appointing
_____________________________________________ Attorney to transfer such Warrant
on the books of the Company, with full power of substitution in the premises.
DATED: _____________ , ____
Signature of Registered Holder
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EXHIBIT "A"
(To be executed only upon partial or full
exercise of the within Warrant)
The undersigned registered Holder of the within Warrant hereby
irrevocably exercises the within Warrant for and purchases shares of Common
Stock of CMG Funding Corp., and herewith makes payment therefor in the amount
specified below, all at the price and on the terms and conditions specified in
the within Warrant and requests that a certificate (or certificates in
denominations of shares) for the shares of Common Stock of CMG Funding Corp,
hereby purchased be issued in the name of and delivered to [CHOOSE ONE] (a)
_____________________ (the undersigned) or (b) ________________, whose address
is _________________________________________________________ and, if such shares
of Common Stock shall not include all the shares of Common Stock issuable as
provided in the within Warrant, that a new Warrant of like tenor for the number
of shares of Common Stock of CMG Funding Corp., not being purchased hereunder be
issued in the name of and delivered to [CHOOSE ONE] (a) _____________________
(the undersigned) or (b) _____________________, whose address is
___________________________________________________________ .
Percentage of equity of CMG Funding Corp. (on a fully diluted
basis) _____%
Exercise Price: $1
Dated: ____________, ____
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By:
-----------------------------------------
(Signature of Registered Holder)
Title:
--------------------------------------
NOTICE: The signature to this Notice of Exercise must correspond with the
name as written upon the face of the within Warrant in every
particular, without alteration or enlargement or any change
whatever.
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Schedule A
Quarterly Pre Tax Net Income Target
Quarter Ended Amount
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March 31, 1998 $ 290,206
June 30, 1998 $ 832,120
September 30, 1998 $1,107,524
December 31, 1998 $1,214,037
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