loans/topr
0532/39038-028 NYLIB2/513320 v7 09/24/98 02:17 PM (10559)
EXECUTION COPY
WARRANT AGREEMENT
BETWEEN
INSIGNIA/ESG HOLDINGS, INC.
AND
FIRST UNION NATIONAL BANK
DATED AS OF SEPTEMBER 30, 1998
532/39038-028 NYLIB2/513320 v7 09/24/98 02:17 PM (10559)
WARRANT AGREEMENT, dated as of September 30, 1998 between INSIGNIA/ESG
HOLDINGS, INC., a Delaware corporation (the "Company"), and FIRST UNION NATIONAL
BANK, a national banking association incorporated under the laws of the United
States of America (the "Warrant Agent").
WHEREAS, the Company issued to Insignia Financial Group, Inc. ("Insignia")
on September~18, 1998, warrants (the "Warrants") to purchase an aggregate of
1,196,000 shares (the "Warrant Shares") of the Company's common stock, par value
$.01 per share (the "Common Stock"), subject to adjustment as provided herein,
and Insignia proposes to transfer such Warrants on September 30, 1998 to the
holders of record of 62% Trust Convertible Preferred Securities ("TOPRs") issued
by Insignia Financing I, a Delaware trust, on September 15, 1998 (the "Record
Date"), in connection with (i)~the proposed merger of Insignia with and into
Apartment Investment and Management Company, a Maryland corporation ("AIMCO"),
pursuant to an Amended and Restated Agreement and Plan of Merger dated as of
May~26, 1998, with AIMCO being the surviving corporation, and (ii)~the
distribution by Insignia of the Common Stock of the Company to the holders of
record of Insignia Class A Common Stock, par value $.01 per share, on September
15, 1998.
WHEREAS, the Company desires the Warrant Agent to act on behalf of the
Company, and the Warrant Agent is willing to so act, in connection with the
registration, transfer, exchange and exercise of the Warrants.
THEREFORE, in consideration of the mutual undertakings contained herein,
the Company and the Warrant Agent hereby agree as follows:
1. Appointment of Warrant Agent. The Company hereby appoints the Warrant
Agent to act as warrant agent for the Company in accordance with the
instructions hereinafter set forth in this Warrant Agreement, and the Warrant
Agent hereby accepts such appointment.
2. Warrant Certificates. Each certificate for Warrants (a "Warrant
Certificate") shall be substantially as set forth in Annex A attached hereto.
The Warrant Certificates shall be executed on behalf of the Company by the
manual or facsimile signature of the present or any future Chairman or Chief
Executive Officer or President or Vice President of the Company, attested to by
the manual or facsimile signature of the present or any future Treasurer or
Secretary or Assistant Secretary of the Company.
Warrant Certificates shall be dated as of the date of authentication by the
Warrant Agent upon transfer or exchange. The Warrant Agent shall countersign and
deliver Warrant Certificates to such Holders and in such number as provided in
this Warrant Agreement. The Warrant Certificates shall be countersigned manually
or by facsimile by the Warrant Agent (or by any successor to the Warrant Agent
then acting as warrant agent under this Warrant Agreement) and shall not be
valid for any purpose unless so countersigned. Warrant Certificates may,
however, be so countersigned by the Warrant Agent (or by its successor as
Warrant Agent) and be delivered by the Warrant Agent, notwithstanding that the
persons whose manual or facsimile signatures appear thereon as proper officers
of the Company shall have ceased to be such officers at the time of such
countersignature or delivery.
14 0532/39038-028 NYLIB2/513320 v7 09/24/98 02:17 PM (10559) 3.
Registration. The Warrant Agent shall maintain a register for the Warrants at
its principal executive offices in Charlotte, North Carolina, for the
registration of the transfer and exchange of Warrants. The Warrant Agent shall
register the Warrants initially in the name of Insignia. The Company and the
Warrant Agent each shall be entitled to treat the registered holder of any
Warrant (the "Holder") as the owner in fact thereof for all purposes and shall
not be bound to recognize any equitable or other claim to or interest in such
Warrant on the part of any other person.
4. Transfer and Exchange of Warrants. Any Warrant shall be transferable
only upon surrender thereof at the Warrant Agent's principal executive offices
located in Charlotte, North Carolina, duly endorsed by its Holder or by such
Holder's duly authorized attorney or representative, or accompanied by proper
evidence of succession, assignment or authority to transfer, in each case in
form satisfactory to the Warrant Agent, together with payment of any taxes which
may be payable in connection with such transfer. Upon any registration of
transfer, the Warrant Agent shall deliver a new Warrant Certificate(s) to the
persons entitled thereto and the surrendered Warrant Certificate shall be
canceled. Warrants so canceled shall be delivered to the Company from time to
time upon request. In addition, a Warrant Certificate may be exchanged, at the
option of the Holder thereof, for another Warrant Certificate(s) of different
denominations, of like tenor and representing in the aggregate the right to
purchase a like number of Warrant Shares upon surrender at the Warrant Agent's
principal executive offices located in Charlotte, North Carolina, duly endorsed
by its Holder or by such Holder's duly authorized attorney or representative, or
accompanied by proper evidence of succession, assignment or authority to
transfer, in each case in form satisfactory to the Warrant Agent. The Warrants
shall be freely transferable, subject only to compliance with applicable
securities laws.
5. Exercise of Warrants.
5.1 Exercise Price and Term. Each Warrant shall entitle the Holder thereof
to purchase from the Company one Warrant Share at a purchase price per share
equal to $14.50 (the "Exercise Price"), as such purchase price and number of
Warrant Shares may be adjusted from time to time pursuant to the provisions of
Section 9 hereof, payable in full at the time of exercise of such Warrant. The
Warrants may be exercised, in whole or in part, at any time or from time to time
during the three-year period commencing on September 15, 2000 and ending at
5:00~p.m., New York City time, on September 15, 2003 or, in the event such date
is a Saturday or Sunday, or a legal holiday on which the New York Stock Exchange
("NYSE") is closed, then the Warrants may be exercised until 5:00~p.m. Eastern
time on the next succeeding Business Day (the "Expiration Date"). A "Business
Day" shall be a day on which banks in New York City are open for business. After
the Expiration Date, any unexercised Warrants shall be void and all rights of
the Holders with respect thereto shall cease.
5.2 Payment of Exercise Price. At the election of any Holder, the aggregate
Exercise Price for any Warrants being exercised may be paid: (a) in cash in the
amount of the aggregate Exercise Price then in effect for the number of Warrants
being exercised, (b) by surrender to the Company of shares of Common Stock
having an aggregate Fair Market Value (as defined below) on the date of exercise
equal to the aggregate Exercise Price then in effect for the number of Warrants
being exercised, (c) by a surrender of Warrants covering a number of Warrant
Shares having an aggregate Fair Market Value, net of the applicable aggregate
Exercise Price therefor, equal to the aggregate Exercise Price then in effect
for the number of Warrants being exercised, or (d) by a combination of the
aforementioned methods of payment. For purposes of this Agreement, the "Fair
Market Value" per share of Common Stock on a given date shall be: (i) if the
Common Stock is listed on a national securities exchange or included on the
NASDAQ National Market, the closing price per share of Common Stock on such date
(or, if there was no trading on such date, on the next preceding day on which
there was trading); (ii) if the Common Stock is not listed on a national
securities exchange or included on the Nasdaq National Market, the average of
the closing bid and asked quotations per share of Common Stock as reported by
Nasdaq (or the National Quotation Bureau Incorporated or any similar
organization) on such date (or, if there were no quotations for the Common Stock
on such date, on the next preceding day on which there were quotations) as
provided by such organization; and (iii) if the Common Stock is not traded on a
national securities exchange or included on the Nasdaq National Market and bid
and asked quotations are not provided by Nasdaq (or the National Quotation
Bureau Incorporated or any similar organization), as determined by the agreement
of the parties in good faith or, in the absence of such agreement, as determined
pursuant to arbitration under the auspices of the American Arbitration
Association; provided, that if the Fair Market Value is determined by agreement
of the parties or arbitration, such agreement or arbitration determination shall
be provided to the Warrant Agent in connection with the exercise of such
Warrants.
5.3 Exercise Procedure. Warrants may be exercised by their surrender to the
Company at the Warrant Agent's principal executive offices in Charlotte, North
Carolina, with the election to purchase form attached thereto duly completed and
executed, accompanied by payment of the aggregate Exercise Price for the Warrant
Shares to be purchased upon such exercise. Payment for the Warrant Shares shall
be made (a) if payment is to be made in cash, by a certified or bank cashier's
check payable to the order of the Company or by wire transfer to an account
designated by the Company, (b) if payment is to be made through a surrender of
shares of Common Stock, by surrender of certificates duly endorsed for transfer
(with all transfer taxes paid or provided for), and (c) if payment is to be made
by a surrender of Warrants, by surrender of certificates representing such
Warrants. The Warrant Agent shall promptly forward to the Company all monies and
certificates for shares of Common Stock received by the Warrant Agent for the
purchase of shares of Common Stock through the exercise of Warrants. Promptly
after the exercise of any Warrants and the payment of the Exercise Price, upon
compliance with Section 6 hereof, the Company shall issue a certificate or
certificates for the number of full Warrant Shares to which the Holder thereof
is entitled, registered in accordance with the instructions set forth in the
election to purchase, together with cash as provided in Section 11 of this
Warrant Agreement payable in respect of fractional shares and (if applicable) a
new Warrant Certificate representing all remaining unexercised Warrants. The
Warrant Agent is hereby irrevocably authorized to countersign and to deliver the
required new Warrant Certificate(s) pursuant to the provisions of this Section
and of Section 4 of this Warrant Agreement and the Company, whenever requested
by the Warrant Agent, will supply the Warrant Agent with Warrant Certificates
duly executed on behalf of the Company for such purpose. All Warrant Shares
shall be duly authorized, validly issued, fully paid, non-assessable and free of
preemptive rights, and listed on the NYSE or on such other national securities
exchange or Nasdaq National Market, as the case may be, on which such Common
Stock is listed or included. Upon compliance with Section 6 hereof, certificates
representing such Warrant Shares and remaining unexercised Warrants shall be
issued in such names and denominations, and shall be delivered to such persons,
as are specified by written instructions of the Holder.
5.4 Record Holder. 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 thereby on the date upon
which such Warrants were surrendered for exercise, accompanied by payment of the
aggregate Exercise Price and any taxes as aforesaid, 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
aggregate Exercise Price and any taxes, the transfer books for the Common Stock
or any 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 exercisable 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 Company shall be under
no duty to deliver any certificate for such Warrant Shares or for shares of such
other class of stock.
6. Payment of Taxes. The Company shall promptly pay all documentary stamp
taxes attributable to the issuance of Warrants or the issuance of Warrant Shares
upon the exercise of any Warrants, except that any taxes payable in connection
with the issuance of Warrants or Warrant Shares in any name other than that of
the Holder of the Warrants surrendered shall be paid by such Holder and, if any
such tax would otherwise be payable by the Company, no such issuance or delivery
shall be made unless and until the person requesting such issuance has paid to
the Company the amount of any such tax or it is established to the satisfaction
of the Company that any such tax has been paid. The Company shall provide the
Warrant Agent with information as to any applicable taxes to be paid in
connection with the issuance, transfer or exercise of the Warrants, Warrant
Certificates and Warrant Shares, and the Warrant Agent shall be entitled to rely
on such information in undertaking its duties under this Warrant Agreement and
shall not be liable for any action taken in reliance thereon. In no event shall
the Warrant Agent be responsible for paying any such taxes, but the Warrant
Agent shall apply any tax payments received by it to the Company's account.
7. Replacement Warrants. In case any Warrant Certificate shall be
mutilated, lost, stolen or destroyed, the Company shall issue, and, upon
instruction of the Company, the Warrant Agent shall countersign and deliver, in
exchange and substitution for and upon cancellation of the mutilated Warrant
Certificate or in lieu of and substitution for the lost, stolen or destroyed
Warrant Certificate, a new Warrant Certificate of like tenor and representing an
equivalent right or interest, but only upon receipt of evidence satisfactory to
the Company and the Warrant Agent of such loss, theft or destruction of such
Warrant Certificate, together with an appropriate agreement regarding
indemnification of the Warrant Agent and the Company relating to the issuance of
a replacement Warrant Certificate. Applicants for substitute Warrant
Certificates shall also comply with such other reasonable regulations and pay
such reasonable charges as the Company or the Warrant Agent shall prescribe.
8. Warrants.
8.1 Reservation of Warrant Shares. The Company shall at all times reserve
and keep available for issuance the number of its authorized but unissued shares
of Common Stock or other capital stock sufficient to permit the exercise in full
of the Warrants and any transfer agent for the Common Stock or other capital
stock issuable upon the exercise of Warrants shall be directed at all times to
reserve such number as shall be sufficient for such purpose. The Company will
keep a copy of this Warrant Agreement on file with each such transfer agent and
will supply such transfer agent with duly executed stock certificates for such
purpose and will provide or otherwise make available any cash that may be
payable as provided in Section~11 hereof. All Warrants surrendered upon the
exercise thereof shall be canceled by the Warrant Agent and shall thereafter be
delivered to the Company, and such canceled Warrants shall constitute sufficient
evidence of the number of shares of Common Stock which have been issued upon the
exercise of such Warrants. After the Expiration Date, the Warrant Agent shall
certify to the Company the total aggregate amount of Warrants then outstanding,
and thereafter, no shares shall be subject to reservation in respect of any
unexercised Warrants.
8.2 Purchase of Warrants by the Company. The Company shall have the right,
except as limited by law, other agreement or herein, to purchase or otherwise
acquire Warrants at such times, in such manner and for such consideration as it
may deem appropriate.
8.3 Redemption of Warrants by the Company. The Company shall have the right
to redeem any or all of the Warrants at $1.00 per Warrant at any time after
September 15, 2000, except that the Warrants may not be so redeemed unless the
closing price (as determined in accordance with Section~5.1 hereof) for the
Common Stock on any 20 trading days within a period of 30 consecutive trading
days ending no more than five days prior to the date upon which notice of call
is first mailed is at least 150% of the Exercise Price in effect on such day.
Notice of the redemption shall be mailed at least 30 days prior to the date
scheduled for such redemption (the "Redemption Date") and shall be given to the
Warrant Agent and the Holders in accordance with the provisions of Section~20
hereof. Such notice shall state the date, place and price of such call. The
notice of redemption also shall be given no more than 60 nor less than 30 days
prior to the mailing of notice to the Holders pursuant to this Section, by
publishing, at least once in the Wall Street Journal (national edition), or if
such edition is not then published, then in one or more newspapers printed in
the English language and in general circulation in New York City, and such
notice shall state the date, place and price of such redemption. If fewer than
all the Warrants outstanding at the time are to be called, the Company shall
give the Warrant Agent written notice as to the aggregate number of Warrants to
be called, and thereupon the Warrant Agent shall select the Warrants to be
called in such manner as it deems, in its discretion, to be fair and
appropriate; provided, that the Warrant Agent shall not be liable to any Holder
for such selection and shall be indemnified by the Company pursuant to Section
14(v) for any liability arising out of such selection. Each Holder shall
continue to have the right to exercise the Warrant until the close of business
on the Business Day which is 15 days prior to the Redemption Date. No less than
one Business Day prior to the Redemption Date, the Company shall deposit with
the Warrant Agent funds sufficient to purchase all of the Warrants called for
redemption which are outstanding at the close of business on the date when the
right to exercise expired.
8.4 Cancellation of Warrants. In the event the Company shall purchase or
otherwise acquire Warrants, the same shall thereupon be delivered to the Warrant
Agent and be canceled by it and retired. The Warrant Agent shall cancel any
Warrant surrendered for exchange, substitution, transfer or exercise in whole or
in part. Warrant Certificates so cancelled shall be delivered to the Company
from time to time upon request or disposed of at the instruction of the Company.
9. Adjustments.
9.1 Adjustment of Exercise Price.
9.1.1 Initial Exercise Price. The Exercise Price, which initially will be
as provided in Section 5.1, shall be adjusted and readjusted from time to time
as provided in this Section 9.1 and, as so adjusted or readjusted, shall remain
in effect until a further adjustment or readjustment thereof is required by this
Section 9.1.
9.1.2 Issuance of Additional Shares of Common Stock. In case the Company,
at any time after the Record Date, shall issue additional shares of Common Stock
for no consideration in connection with a dividend, stock split or other
distribution on the Common Stock (including, without limitation, any
distribution of Common Stock by way of spin-off, reclassification or corporate
rearrangement), then, and in each such case, the Exercise Price shall be reduced
concurrently with such issuance to a price (calculated to the nearest cent)
determined by multiplying such Exercise Price by a fraction of which:
(a) the numerator shall be the number of shares of Common Stock outstanding
immediately prior to such issuance; and
(b) the denominator shall be the number of shares of Common Stock
outstanding immediately after such issuance.
9.1.3 Dividends and Distributions. In case the Company, at any time after
the Record Date, shall pay or make a dividend or other distribution on the
Common Stock (including, without limitation, any distribution of stock (other
than Common Stock) or other securities, including securities that are
convertible into or exchangeable or exercisable for Common Stock, property or
options by way of dividend, spin-off, reclassification or corporate
rearrangement) then, and in each such case, the Exercise Price in effect
immediately prior to the close of business on the record date fixed for the
determination of the holders of the Common Stock entitled to receive such
dividend or other distribution shall be reduced, effective as of the close of
business on such record date, to a price (calculated to the nearest cent)
determined by multiplying such Exercise Price by a fraction of which:
(a) the numerator shall be the Exercise Price in effect immediately prior
to the close of business on such record date minus the value on such record date
of such dividend or other distribution (as determined in good faith by the Board
of Directors of the Company) applicable to one share of Common Stock; and
(b) the denominator shall be such Exercise Price in effect immediately
prior to the close of business on such record date;
provided, however, that no such reduction shall be made pursuant to this
Section~9.1.3 for a dividend payable in shares of Common Stock (which is subject
to Section~9.1.2) or payable in cash or other property and declared out of the
earned surplus (i.e., retained earnings) of the Company (excluding any portion
thereof resulting from a revaluation of property) or which is declared but is
then not paid or made. For purposes of the foregoing, a dividend or distribution
payable other than in cash shall be considered payable out of earned surplus
only to the extent that such earned surplus is charged an amount equal to the
fair value of such dividend or distribution at the time of payment as determined
in good faith by the Board of Directors of the Company. If a dividend or
distribution covered under this Section 9.1.3 is declared prior to the
Expiration Date but not paid by such date, the Expiration Date shall be extended
until the payment thereof.
9.1.4 Adjustments for Combinations, etc. In case the outstanding shares of
Common Stock shall be combined or consolidated, by reclassification or
otherwise, into a lesser number of shares of Common Stock, the Exercise Price in
effect immediately prior to such combination or consolidation shall be
proportionately increased concurrently with the effectiveness of such
combination or consolidation.
9.1.5 Minimum Adjustment of Exercise Price. If the amount of any adjustment
of the Exercise Price required pursuant to this Section~9.1 would be less than
1% of the Exercise Price, such amount shall be carried forward, and an
adjustment with respect thereto shall be made at the time of and together with
any subsequent adjustment that, together with such amount and any other amount
or amounts so carried forward, shall aggregate at least 1% of the Exercise
Price.
9.1.6 Minimum Exercise Price. Notwithstanding anything to the contrary set
forth herein, no adjustment provided for in this Section 9.1 shall reduce the
Exercise Price below the par or stated value of the Common Stock and the Company
shall have no obligation to change such value to permit a further reduction of
the Exercise Price; provided, however, that, except in the event of any
transactions of the type contemplated under Section 9.1.4 hereof, the Company
agrees not to change the par or stated value of the Common Stock.
9.1.7 Voluntary Adjustment by the Company. The Company may at its option,
at any time during the term of the Warrants, reduce the then current Exercise
Price to any amount and for any period of time deemed appropriate by the Board
of Directors of the Company.
9.2 Adjustment of Number of Warrant Shares. Upon each adjustment of the
Exercise Price pursuant to the provisions of Section 9.1, the number of Warrant
Shares that the Holder of a Warrant shall be entitled to receive upon exercise
thereof shall be adjusted to equal that number of Warrant Shares determined by
multiplying the number of Warrant Shares issuable upon exercise of such Warrant
immediately prior to such adjustment of the Exercise Price by a fraction of
which:
(a) the numerator shall be the Exercise Price in effect immediately prior
to such adjustment of the Exercise Price; and
(b) the denominator shall be the Exercise Price in effect immediately
following such adjustment of the Exercise Price.
9.3 Notice, Evidence of Adjustments. Within a reasonable time after the
close of the quarterly fiscal period of the Company during which the Exercise
Price is adjusted as herein provided, the Company shall file with the Warrant
Agent a certificate signed by an executive officer of the Company setting forth
the adjusted Exercise Price and adjusted number of Warrant Shares issuable upon
exercise of each Warrant. The Warrant Agent shall have no duty with respect to
any such certificate filed with it except to keep the same on file and available
for inspection by the Holders during reasonable business hours, and the Warrant
Agent may conclusively rely upon the latest certificate furnished to it
hereunder. In the absence of a certificate having been furnished, the Warrant
Agent may conclusively rely upon the provisions of the Warrant Certificates with
respect to the Common Stock deliverable upon exercise of the Warrants and the
Exercise Price. The Company shall retain a firm of independent public
accountants of nationally recognized standing selected by the Board of Directors
(who may be the regular accountants employed by the Company) to make any
computation required by this Section 9, and a certificate signed by such firm
shall accompany said notice and shall be conclusive evidence of the correctness
of such adjustments. Notwithstanding anything in this Warrant Agreement to the
contrary, the Warrant Agent shall not at any time be under any duty or
responsibility to any Holder or beneficial owner of a Warrant to determine
whether any facts exist which may require any adjustment pursuant to Section 9
hereof or otherwise, or with respect to the nature or extent of any such
adjustment made or with respect to the method employed in making such
adjustment, and shall be indemnified and held harmless to the extent specified
in Section 14(v) hereof in connection with any claim or dispute arising from any
such adjustment, any failure or asserted failure to make such adjustment, or any
insufficiency or asserted insufficiency of any such adjustment.
9.4 Statement on Warrants. Irrespective of any adjustments in the Exercise
Price or the number or kind of shares purchasable upon the exercise of the
Warrants, Warrants theretofore or thereafter issued may continue to express the
same price and number and kind of shares as are stated in the Warrants initially
issuable pursuant to this Warrant Agreement.
10. Consolidation, Merger, Sale of Assets, Reorganization, etc.
10.1 General Provisions. In case the Company at any time after the Record
Date (a)~shall consolidate with or merge into any other person and not be the
continuing or surviving person of such consolidation or merger, or (b~shall
permit any other person to consolidate with or merge into the Company and the
Company shall be the continuing or surviving person but, in connection with such
consolidation or merger, the Common Stock or other securities then issuable upon
exercise of the Warrants shall be changed into or exchanged for cash, stock or
other securities or property, or (c)~shall transfer, directly or indirectly, all
or substantially all its properties and assets to any other person, or (d)~shall
effect a capital reorganization or reclassification of the Common Stock or other
securities then issuable upon exercise of the Warrants (other than a capital
reorganization or reclassification resulting in an adjustment of the Exercise
Price as provided in Section 9.1), then, and in the case of each such
transaction, the Company shall make proper provision such that, upon the terms
and in the manner provided in this Warrant Agreement, the Holder of each
Warrant, upon the exercise thereof at any time after the consummation of such
transaction, shall be entitled to receive, at the Exercise Price then in effect,
in lieu of the Common Stock or other securities issuable upon such exercise
immediately prior to such transaction, the amount of cash, stock or other
securities or property to which such Holder would have been entitled if such
Warrant had been exercised in full immediately prior to such transaction,
subject to adjustments subsequent to such transaction as nearly equivalent as
possible to the adjustments provided for in Section 9 and this Section 10.
10.2 Assumption of Obligation. Notwithstanding anything contained in this
Warrant Agreement to the contrary, the Company shall not effect any of the
transactions described in Section 10.1(a), (b), (c) or (d) unless, prior to the
consummation thereof, the person (other than the Company) that may be required
to deliver any cash, stock or other securities or property upon exercise of any
Warrant as provided herein shall assume, by written instrument, (a)~the
obligations of the Company under this Warrant Agreement and the Warrants (and if
the Company shall survive the consummation of any such transaction, such
assumption shall not release the Company from any continuing obligations of the
Company under this Warrant Agreement and the Warrants) and (b)~the obligation to
deliver to such Holder such cash, stock or other securities or other property as
such Holder may be entitled to receive in accordance with the provisions of this
Section~10; provided, however, that this Section~10.2 shall not be applicable to
any transaction described in Section~10.1(c) if all such cash, stock, property
or other consideration receivable upon consummation of such transaction is
delivered to the Company at such time. Such person shall similarly deliver to
the Company an opinion of counsel to the effect that this Warrant Agreement and
the Warrants shall continue in full force and effect after any such transaction
and that the terms hereof (including, without limitation all of the provisions
of Section~9 and this Section~10) and thereof shall be applicable to the cash,
stock or other securities or property that such person may be required to
deliver upon any exercise of the Warrants.
10.3 No Dilution or Impairment. The Company shall not, by amendment of its
certificate of incorporation or by-laws or through any consolidation, merger,
reorganization, transfer of assets, dissolution, issue, sale, grant or
assumption of securities or any other voluntary action, avoid or seek to avoid
the observance or performance of any of the terms of this Warrant Agreement or
the Warrants, but will at all times, whether or not requested to do so, in good
faith assist in the carrying out of all such terms and in the taking of all such
action as may be necessary or appropriate in order to protect the rights of the
Holders against dilution or other impairment. Without limiting the generality of
the foregoing, but subject to Section~9.1.6, the Company agrees that it shall
take all such reasonable action as may be necessary or appropriate in order that
the Company may validly and legally issue fully paid and non-assessable shares
of stock upon the exercise of all Warrants from time to time outstanding.
11. Fractional Interests. The Company shall not be required to issue
fractions of shares of Common Stock upon the exercise of any Warrants. If more
than one Warrant shall be presented for exercise at the same time by the same
Holder, the number of Warrant Shares that shall be issuable upon the exercise
thereof shall be computed on the basis of the aggregate number of Warrant Shares
purchasable on exercise of the Warrants so presented. If any fraction of a share
of Common Stock would, except for the provisions of this Section 11, be issuable
on the exercise of any Warrant, the Company shall purchase such fraction for an
amount in cash equal to the same fraction of the Fair Market Value of one share
of Common Stock on the date of exercise.
12. Securities Law Compliance. The Company covenants that it will use its
reasonable best efforts to timely file all reports required to be filed by it
under the Securities Act of 1933, as amended (the "Act"), and the Securities
Exchange Act of 1934, as amended (the "Exchange Act"). So long as the Company is
subject to the periodic reporting requirements of the Exchange Act, the Company
covenants to use its reasonable best efforts to make publicly available such
information as may be necessary to permit the sale of Warrant Shares without
registration under the Act pursuant to the exemption provided by Rule 144 under
the Act, as such rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the Securities and Exchange Commission. Upon
request of any Holder of Warrants or Warrant Shares, the Company will deliver to
such Holder a written statement as to whether it has complied with such
information requirements.
13. Merger or Consolidation or Change of Name of Warrant Agent. Any
corporation or company which may succeed to the corporate trust business of the
Warrant Agent by any merger, consolidation, asset transfer or otherwise shall be
the successor to the Warrant Agent hereunder without the execution or filing of
any paper or any further act on the part of any of the parties hereto, provided
that such corporation would be eligible as a successor Warrant Agent under the
provisions of Section~15 of this Warrant Agreement. In case at the time such
successor to the Warrant Agent shall succeed to the agency created by this
Warrant Agreement, any of the Warrants shall have been countersigned but not
delivered, any such successor to the Warrant Agent may adopt the
countersignature of the original Warrant Agent and deliver such Warrants so
countersigned. In case at any time the name of the Warrant Agent shall be
changed and at such time any of the Warrants shall have been countersigned but
not delivered, the Warrant Agent may adopt the countersignature under its prior
name and deliver Warrants so countersigned. In all such cases such Warrants
shall have the full force provided in the Warrants and in this Warrant
Agreement.
14. Duties of Warrant Agent. The Warrant Agent undertakes the duties and
obligations imposed by this Warrant Agreement upon the following terms and
conditions, by all of which the Company and the Holders, by their acceptance
thereof, shall be bound:
(i) The statements of fact and recitals contained herein and in the Warrant
Certificates shall be taken as statements of the Company, and the Warrant Agent
assumes no responsibility for the correctness of any of the same except such as
describe the Warrant Agent. The Warrant Agent assumes no responsibility with
respect to the distribution of the Warrants except as herein expressly provided.
(ii) The Warrant Agent shall not be responsible for any failure of the
Company to comply with any of the covenants in this Agreement or in the Warrants
to be complied with by the Company.
(iii) The Warrant Agent may consult at any time with counsel satisfactory
to it (who may be counsel for the Company) and the Warrant Agent shall incur no
liability or responsibility to the Company or to any Holder in respect of any
action taken, suffered or omitted by it hereunder in good faith and in
accordance with the opinion or the advice of such counsel. The Company shall
promptly pay the reasonable fees and expenses of any such counsel.
(iv) The Warrant Agent shall incur no liability or responsibility to the
Company or to any Holder for any action taken in reliance on any notice,
resolution, waiver, consent, order, certificate or other instrument believed by
it to be genuine and to have been signed, sent or presented by the proper party
or parties.
(v) The Company agrees to pay to the Warrant Agent compensation to be
agreed for all services rendered by the Warrant Agent in the performance of its
duties under of this Warrant Agreement, to reimburse the Warrant Agent for all
expenses, taxes and governmental charges and other charges of any kind
reasonably incurred by the Warrant Agent in the performance of its duties under
this Warrant Agreement and to indemnify the Warrant Agent and its officers,
directors, employees and agents and save each of them harmless against any and
all losses, liabilities and expenses, including, without limitation, judgments,
costs and reasonable counsel fees, for anything arising from or in connection
with this Warrant Agreement or done or omitted by the Warrant Agent pursuant to
this Warrant Agreement except as a result of the Warrant Agent's gross
negligence, willful misconduct or bad faith. In no event shall the Warrant Agent
be liable for incidental, indirect, special, consequential or punitive damages.
All such amounts to which any indemnified party is entitled under this Section
14(v) shall be paid by the Company from time to time as incurred, both in
advance of and after the final disposition of any action or claim giving rise to
such indemnifiable amount. This Section 14(v) will survive any termination of
this Warrant Agreement and the resignation or removal of the Warrant Agent.
(vi) The Warrant Agent shall not be obligated to take any legal action or
commence any proceeding on behalf of, or at the request of, any party in
connection with this Warrant Agreement, or to appear in, prosecute or defend any
such legal action or proceeding. The Warrant Agent shall incur no liability for
delaying performance of its obligations under this Warrant Agreement if there is
any dispute regarding the Warrant Agent's obligations hereunder or if the
Warrant Agent is otherwise uncertain of its obligations hereunder. Unless
otherwise agreed between the Warrant Agent and the Company, the Warrant Agent
shall have no liability for interest on any monies at any time received by the
Warrant Agent pursuant to any provisions of this Warrant Agreement or the
Warrant Certificates. In no event shall the Warrant Agent be under any
obligation to take any other action likely to involve expenses unless the
Company or one or more Holders shall furnish the Warrant Agent with reasonable
security and indemnity for any costs and expenses which may be incurred, but
this provision shall not affect the power of the Warrant Agent to take such
action as the Warrant Agent may consider proper, whether with or without any
such security or indemnity. All rights of action under this Warrant Agreement or
under any of the Warrants may be enforced by the Warrant Agent without the
possession of any of the Warrants or the production thereof at any trial or
other proceeding, and any such action, suit or proceeding instituted by the
Warrant Agent shall be brought in its name as Warrant Agent, and any recovery or
judgment shall be for the ratable benefit of the Holders, as their respective
rights and interests may appear.
(vii) The Warrant Agent and any stockholder, director, officer, partner or
employee of the Warrant Agent may buy, sell or deal in any of the Warrants or
other securities of the Company or become pecuniarily interested in any
transaction in which the Company may be interested, or contract with or lend
money to or otherwise act as fully and freely as though it were not the Warrant
Agent under this Warrant Agreement or such stockholder, director, officer,
partner or employee. Nothing herein shall preclude the Warrant Agent from acting
in any other capacity for the Company or for any other legal entity.
(viii) The Warrant Agent shall act hereunder solely as agent for the
Company and its duties shall be determined solely by the provisions hereof, and
no implied duties of the Warrant Agent shall be read into this Warrant Agreement
or any Warrant Certificate or other document or instrument executed in
connection herewith. The Warrant Agent does not assume any obligations or
relationship of agency or trust for or with the Holders of the Warrants or the
beneficial owners of the Warrant Shares. The Warrant Agent shall not be liable
for anything which it may do or refrain from doing in connection with this
Warrant Agreement except for its own gross negligence, willful misconduct or bad
faith.
(ix) 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, and the Warrant Agent shall not be
answerable or accountable for any such attorneys, agents or employees or for any
loss to the Company resulting from their neglect or misconduct, provided
reasonable care had been exercised in the selection and continued employment
thereof.
(x) The Warrant Agent is hereby authorized and directed to accept
instruction with respect to the performance of its duties hereunder from any
executive officer 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 accordance with instructions of
any such officer or officers. Any request, direction, election, order or demand
of the Company shall be sufficiently evidenced by an instrument signed in the
name of the Company by an executive officer (unless other evidence in respect
thereof be herein specifically prescribed); and any resolution of the Board of
Directors may be evidenced to the Warrant Agent by a copy thereof certified by
the Secretary or an Assistant Secretary of the Company.
(xi) The Warrant Agent shall not be under any responsibility in respect of
the validity of this Warrant Agreement or the execution and delivery hereof
(except the due execution hereof by the Warrant Agent) or in respect of the
validity or execution of any Warrant (except its countersignature thereof); nor
shall the Warrant Agent by any act hereunder be deemed to make any
representation or warranty as to the authorization or reservation of any Warrant
Shares or other stock) to be issued pursuant to this Warrant Agreement or any
Warrant, or as to whether any Warrant Shares (or other stock) will, when issued,
be validly issued, fully paid and nonassessable, or as to the Exercise Price or
the number or amount of Warrant Shares or other securities or other property
issuable upon exercise of any Warrant.
15. Change of Warrant Agent. The Warrant Agent may resign and be discharged
from its duties under this Warrant Agreement by giving to the Company notice in
writing, and to the Holders notice by mailing such notice to the Holders at
their addresses appearing on the Warrant register, of such resignation,
specifying a date when such resignation shall take effect. The Warrant Agent may
be removed by like notice to the Warrant Agent from the Company and the like
mailing of notice to the Holders. If the Warrant Agent shall resign or be
removed or shall otherwise become incapable of acting, the Company shall appoint
a successor to the Warrant Agent. If the Company shall fail to make such
appointment within a period of thirty (30) days after such removal or after it
has been notified in writing of such resignation or incapacity by the resigning
or incapacitated Warrant Agent or after the Company has received such notice
from a Holder of a Warrant (who shall, with such notice, submit his Warrant for
inspection by the Company), then such Holder may apply to any court of competent
jurisdiction for the appointment of a successor to the Warrant Agent. Any
successor Warrant Agent, whether appointed by the Company or by such a court,
shall be a bank or trust company, in good standing, incorporated under the laws
of the United States of America or any state thereof. The Company shall
indemnify and hold harmless the Warrant Agent to the extent set forth in Section
14(v) hereof for any failure to appoint a successor Warrant Agent. After
appointment, the successor Warrant Agent shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally named as
Warrant Agent without further act or deed and the former Warrant Agent shall
deliver and transfer to the successor Warrant Agent all canceled Warrants,
records and property at the time held by it hereunder, and execute and deliver
any further assurance or conveyance necessary for the purpose. Failure to file
or mail any notice provided for in this Section 15, however, or any defect
therein, shall not affect the validity of the resignation or removal of the
Warrant Agent or the appointment of the successor Warrant Agent, as the case may
be.
160 Identity of Transfer Agent. Forthwith upon the appointment of any
transfer agent for the shares of Common Stock or of any subsequent transfer
agent for the shares of Common Stock or other shares of the Company's capital
stock issuable upon the exercise of the rights of purchase represented by the
Warrants, the Company will file with the Warrant Agent a statement setting forth
the name and address of such transfer agent.
170 Notices to Holders.
17.1 No Rights as Stockholders. Nothing contained in this Warrant Agreement
or in any of the Warrants shall be construed as conferring upon the Holders
thereof as such the right to vote or to receive dividends or to consent or to
receive notice as stockholders in respect of the meetings of stockholders or the
election of directors of the Company or any other matter or any other rights
whatsoever as stockholders of the Company.
17.2 Required Notice to Holders from the Company. In the event the Company
intends to:
(a) make any distribution on or with respect to its Common Stock (or other
securities that may then be issuable in lieu thereof upon the exercise of
Warrants), including without limitation any dividend or distribution from earned
surplus, any dividend or distribution of stock, assets or evidences of
indebtedness, or any similar distribution,
(b) issue subscription rights or warrants to holders of its Common Stock,
(c) consolidate or merge with or into another entity,
(d) liquidate, dissolve or sell or otherwise dispose of substantially all
its assets, or
(e) take any other action that would result in an adjustment to the
Exercise Price or an adjustment to the number of Warrant Shares that the Holder
of a Warrant shall be entitled to receive upon exercise thereof,
then the Company shall cause a notice of its intention to take such action
to be delivered to the Warrant Agent and, at the Company's expense, sent by
first-class mail, postage prepaid, at least 10 days prior to the date fixed as a
record date or the date of closing the transfer books for the determination of
the stockholders entitled to such distribution or issuance or to vote upon such
proposed consolidation, merger, liquidation, dissolution, sale or disposition to
each Holder at its address appearing on the Warrant register, but failure to
mail or to receive such notice or any defect therein or in the mailing thereof
shall not affect the validity of any action taken in connection with such
distribution, issuance, consolidation, merger, liquidation, sale or conveyance.
180 Governing Law. The validity, interpretation and performance of this
Warrant Agreement, of each Warrant issued hereunder and of the respective terms
and provisions thereof shall be governed by the laws of the State of New York
without giving effect to principles of conflicts of law.
190 Counterparts. This Warrant Agreement may be executed in two or more
counterparts, each of which when so executed shall be deemed to be an original;
but such counterparts shall together constitute but one and the same instrument.
200 Notices. Any notice or demand required by this Warrant Agreement to be
given or made by any Holder or the Warrant Agent to or on the Company shall be
sufficiently given or made if sent by registered or certified mail, postage
prepaid, or by facsimile transmission addressed as follows:
Insignia/ESG Holdings, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
with a copy to:
Proskauer Rose LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Any notice or demand required by this Warrant Agreement to be given or made
by the Company or the Warrant Agent to or on the Holder of any Warrant shall be
sufficiently given or made, whether or not such Holder receives the notice, if
sent by first-class mail, postage prepaid, addressed to such Holder at his last
address as shown on the books of the Company.
Any notice or demand required by this Warrant Agreement to be given or made
by the Company or any Holder to or on the Warrant Agent shall be sufficiently
given or made if sent by registered or certified mail, postage prepaid, or by
facsimile transmission addressed as follows:
First Union National Bank
Shareholder Services Group
▇▇▇▇ ▇. ▇. ▇▇▇▇▇▇ ▇▇▇▇., #▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇
210 Supplements and Amendments. The Company and the Warrant Agent may from
time to time supplement or amend this Warrant Agreement 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 be inconsistent with the provisions of the Warrants and which shall not
adversely affect the interest of the Holders.
220 Benefits of this Agreement. Except as provided in Section~23, nothing
in this Agreement shall be construed to give to any person or corporation other
than the Company, the Warrant Agent and the Holders any legal or equitable
right, remedy or claim under this Warrant Agreement.
230 Successors. All of the covenants and provisions of this Warrant
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 hereunder.
IN WITNESS WHEREOF, the parties have executed this Warrant Agreement as of
the date first set forth above.
INSIGNIA/ESG HOLDINGS, INC.
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title:Executive Vice-President
FIRST UNION NATIONAL BANK, as Warrant Agent
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Assistant Vice-President
ANNEX A
THE WARRANTS REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO (i)~AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, OR
(ii)~AN AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE ACT RELATING TO THE
DISPOSITION OF SECURITIES AND UPON DELIVERY TO THE COMPANY OF AN OPINION OF
COUNSEL, REASONABLY SATISFACTORY TO COUNSEL FOR THE COMPANY, THAT SUCH EXEMPTION
FROM REGISTRATION UNDER THE ACT IS AVAILABLE.
COMMON STOCK PURCHASE WARRANTS
C No. __ C C [Number] Warrants C
Void After 5:00 p.m. New York City Time
CUSIP No. 45766D 1 1 8
On September 15, 2003
INSIGNIA/ESG HOLDINGS, INC.
THIS CERTIFIES THAT, for value received, [Name], or registered assigns, is
the Holder of the number of Warrants set forth above, each Warrant entitling the
Holder to purchase at any time during the period commencing on September 15,
2000 and ending at 5:00 p.m., New York City time, on September 15, 2003 (the
"Expiration Date"), one fully paid and non-assessable share of common stock, par
value $.01 per share ("Common Stock"), of Insignia/ESG Holdings, Inc., a
Delaware corporation (the "Company"), at a purchase price per share (the
"Exercise Price") initially equal to $_____, upon presentation and surrender of
this Warrant Certificate with the Form of Election to Purchase (attached hereto)
duly executed. The number of Warrants evidenced by this Warrant Certificate (and
the number of shares that may be purchased upon exercise hereof (the "Warrant
Shares") set forth above and the Exercise Price set forth above are the number
and Exercise Price as of the date of original issuance of this Warrant
Certificate, based on the Common Stock as constituted at such date. As provided
in the Warrant Agreement referred to below, the Exercise Price and the number or
kind of shares that may be purchased upon the exercise of the Warrants evidenced
by this Warrant Certificate are subject to modification and adjustment upon the
happening of certain events. The Warrants are subject to redemption by the
Company for $1.00 per Warrant at any time after September 15, 2000 except that
the Warrants may not be so redeemed unless the closing price (as determined in
accordance with Section~5.1 of the Warrant Agreement) for the Common Stock of
the Company on any 20 trading days within a period of 30 consecutive trading
days ending no more than five days prior to the date upon which notice of
redemption is first mailed is at least 150% of the Exercise Price in effect on
that day.
This Warrant Certificate is subject to, and entitled to the benefits of,
all of the terms, provisions and conditions of the Warrant Agreement dated as of
September 30, 1998 between the Company and First Union National Bank, a national
banking association incorporated under the laws of the United States of America,
which Warrant Agreement is hereby incorporated herein reference and made a part
hereof and to which reference is hereby made for a full description of the
rights, limitations of rights, duties and immunities hereunder of the Company,
the Warrant Agent and the Holders. Terms used herein and not otherwise defined
shall have the meanings set forth in the Warrant Agreement. A copy of the
Warrant Agreement is on file at the principal executive office of the Company.
This Warrant Certificate, with or without other Warrant Certificates, upon
surrender at the principal office of the Company, may be exchanged for another
Warrant Certificate or Warrant Certificates of like tenor, evidencing Warrants
entitling the Holder to purchase a like aggregate number of shares of Common
Stock (or other shares) as the Warrants evidenced by the Warrant Certificate or
Warrant Certificates surrendered entitled such Holder to purchase. If this
Warrant Certificate shall be exercised in part, the Holder hereof shall be
entitled to receive upon surrender hereof another Warrant Certificate or Warrant
Certificates for the number of whole Warrants not exercised.
The Exercise Price may be paid in cash or by surrender of the appropriate
number of Warrants or shares of Common Stock in a cashless exercise or in a
combination thereof as provided in Section~5.2 of the Warrant Agreement.
No fractional shares of Common Stock will be issued upon the exercise of
any Warrant or Warrants evidenced hereby, but in lieu thereof a cash payment
will be made as provided in Section~11 of the Warrant Agreement.
No Holder of this Warrant Certificate, as such, shall be entitled to vote
or to receive dividends or to consent or to receive notice as a stockholder of
the meetings of stockholders for the election of directors of the Company or any
other matter or to any rights whatsoever as stockholder of the Company, until
the Warrant or Warrant evidenced by this Warrant Certificate shall have been
exercised and the Warrant Shares shall have been delivered as provided in the
Warrant Agreement.
If this Warrant Certificate shall be surrendered for exercise within any
period during which the transfer books for the Common Stock or other class of
stock issuable upon exercise of this Warrant Certificate are closed for any
purpose, the Company shall not be required to make delivery of certificates for
shares issuable upon such exercise until the date of the reopening of said
transfer books as provided in the Warrant Agreement.
This Warrant Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Warrant Agent.
Dated: ______________________
INSIGNIA/ESG HOLDINGS, INC.
By:
Name:
Title:
Attest: Countersigned:
FIRST UNION NATIONAL BANK,
WARRANT AGENT
By: By :
Name: Authorized Officer
Title:
FORM OF ASSIGNMENT
(To be executed by the Holder if such Holder desires to transfer this Warrant
Certificate).
TO INSIGNIA/ESG HOLDINGS, INC.
FOR VALUE RECEIVED, __________________________________________ hereby sells
assigns and transfers unto ________________________ (name and address of
assignee must be printed or type written) ______________ Warrants represented by
this Warrant Certificate, together with all rights, title and interest therein,
and does hereby irrevocably constitute and appoint ______________________ to
transfer said Warrants on the books of the within-named Company, with full power
of substitution, and if said number of Warrants shall not be all the Warrants
represented by this Warrant Certificate, a new Warrant Certificate is to be
issued in the name of the undersigned for the remaining Warrants represented by
this Warrant Certificate.
DATED:
Signature
Signature Guaranteed:
NOTICE:
The signature on the foregoing assignment must correspond to the name as
written upon the face of this Warrant Certificate in every particular, without
alteration or enlargement or any change whatsoever.
FORM OF ELECTION TO PURCHASE
(To be executed if Holder desires to exercise the Warrants evidenced by this
Warrant Certificate).
TO INSIGNIA/ESG HOLDINGS, INC.
The undersigned hereby (1) irrevocably elects to exercise
___________________________________ Warrants represented by this Warrant
Certificate to purchase __________ shares of Common Stock (or other shares)
issuable upon the exercise of such Warrants, (2) makes payment in full of the
aggregate Exercise Price for such Warrants by enclosure of a certified or bank
cashier's check therefor or by surrendering Warrants or shares of Common Stock
for application to the aggregate Exercise Price, upon condition that new
Warrants be issued for the balance of the Warrants remaining, and (3) requests
that certificates for shares and Warrants be issued in the name of and delivered
to:
(Please insert social security or other
identifying number)
(Please print name and address)
If such number of Warrants shall not be all the Warrants evidenced by this
Warrant Certificate, a new Warrant Certificate for the balance remaining of such
Warrants shall be registered in the name of and delivered to:
Please insert social security or other
identifying number)
(Please print name and address)
DATED:
Signature
Signature Guaranteed:
NOTICE:
The signature on the foregoing election to purchase must correspond to the name
as written upon the face of this Warrant Certificate in every particular,
without alteration or enlargement or any change whatsoever.