-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
WARRANT
TO PURCHASE
SHARES OF
COMMON STOCK
OF
ANCHOR PACIFIC UNDERWRITERS, INC.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
TABLE OF CONTENTS
PAGE
----
1. General Terms................................................. 1
1.1 Right to Acquire Securities.............................. 1
1.2 Exercise of Warrant...................................... 2
1.3 Record Holder............................................ 2
1.4 Payment of Taxes......................................... 2
1.5 Transfer and Exchange.................................... 2
2. Transfer of Securities........................................ 3
2.1 Restrictions of Transfer................................. 3
2.2 Cooperation.............................................. 4
3. Registration Rights........................................... 4
3.1 Rights of Warrantholders................................. 4
3.2 Expenses................................................. 6
3.3 Company Responsibilities................................. 6
3.4 Indemnification.......................................... 6
3.5 Holder's Obligations..................................... 8
3.6 Assignment............................................... 8
4. Adjustments to Exercise Price and Warrant Shares.............. 8
4.1 Subdivision or Combination............................... 8
4.2 Adjustment for Reorganization, Consolidation, Merger..... 8
4.3 Miscellaneous Exercise Matters........................... 9
4.4 No Dilution or Impairment................................ 9
4.5 Notice of Adjustment.....................................10
4.6 Duty to Make Fair Admustments in Certain Cases...........10
5. Miscellaneous.................................................10
5.1 Entire Agreement.........................................10
5.2 Sucessors and Assigns....................................10
5.3 Governing Law............................................10
5.4 Notices, Etc.............................................10
5.5 Delays or Omissions......................................10
5.6 Survival.................................................11
5.7 Waivers and Amendments...................................11
5.8 Severability.............................................11
(ii)
5.9 Registered Holder........................................11
5.10 Titles and Subtitles.....................................12
Exercise Notice..............................................................13
Form of Assignment...........................................................14
(iii)
WARRANT
TO PURCHASE SHARES OF COMMON STOCK OF
ANCHOR PACIFIC UNDERWRITERS, INC.
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED AND MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS (A)
COVERED BY AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT, (B) IN
COMPLIANCE WITH RULE 144 UNDER SUCH ACT, OR (C) THE COMPANY HAS BEEN
FURNISHED WITH AN OPINION OF COUNSEL REASONABLY ACCEPTABLE TO THE COMPANY
THAT NO REGISTRATION IS REQUIRED FOR SUCH TRANSFER.
__________ Shares of Common Stock
1. GENERAL TERMS.
1.1 RIGHT TO ACQUIRE SECURITIES.
(a) This Warrant certifies that for value received ________________
________________________________________________ (the "Holder"), or registered
assigns, are entitled at any time before 5:00 p.m., San Francisco, California
time, on the Expiration Date (as such term is defined herein) to purchase
from ANCHOR PACIFIC UNDERWRITERS, INC., a Delaware corporation (the
"Company"), ________ shares (the "Warrant Shares") of the fully paid and
non-assessable Common Stock of the Company ("Common Stock") as constituted on
the date hereof (the "Issuance Date"), at a price of $1.75 per share (the
"Exercise Price"), such number of shares and price per share subject to
adjustment as provided herein and all subject to the conditions set forth
herein. This Warrant may be exercised at any time on or before five years
from the date hereof (the "Expiration Date").
Upon any partial exercise hereof, there shall be issued to the
Holder a new Warrant or Warrants with respect to the shares of Common Stock
not so exercised. No fractions of a share of Common Stock will be issued
upon the exercise of this Warrant, but if a fractional share would be
issuable upon exercise the Company will pay in cash the fair market value
thereof as determined by the Board of Directors of the Company in good faith.
(b) The Warrant may be subdivided, at the Warrantholder's option,
into several warrants to purchase the Warrant Shares (collectively, also
referred to as the "Warrant"). Such subdivision may be accomplished in
accordance with the provisions of Section 1.5 hereof.
(1)
1.2 EXERCISE OF WARRANT.
(a) The Holder or any person or entity to whom the Holder has
assigned its right under this Warrant (collectively referred to as the
"Warrantholder") may exercise the Warrant, in whole or in part, at any time or
from time to time, prior to its expiration, on any business day, by delivering a
written notice in the form attached hereto (the "Exercise Notice") to the
Company at the offices of the Company designated in Section 5.4 hereof,
exercising the Warrant and specifying (i) the total number of shares of Common
Stock the Warrantholder will purchase pursuant to such exercise and (ii) a place
and date not less than one nor more than 20 business days from the date of the
Exercise Notice for the closing of such purchase.
(b) At any closing under Section 1.2(a) hereof, (i) the
Warrantholder will surrender the Warrant and make payment to the Company of
the aggregate Exercise Price for the shares of Common Stock so purchased by
bank, cashier's or certified check and (ii) the Company will deliver to the
Warrantholder a certificate or certificates for the number of shares of
Common Stock issuable upon such exercise, together with cash, in lieu of any
fraction of a share, as provided in Section l.l(a) above. Upon any partial
exercise, a new warrant or warrants of the same tenor and expiration date for
the purchase of the number of such shares not purchased upon such exercise
shall be issued by the Company to the registered holder thereof.
1.3 RECORD HOLDER. A Warrant shall be deemed to have been
exercised immediately prior to the close of business on the date of its
surrender for exercise as provided in Section 1.2(b) above, and the person
entitled to receive the shares of Common Stock issuable upon such exercise
shall be treated for all purposes as the holder of such shares of record as
of the close of business on such date.
1.4 PAYMENT OF TAXES. The Company shall pay all taxes and other
governmental charges that may be imposed in respect of the issue or delivery
of the Warrant Shares or any portion thereof. The Company shall not be
required, however, to pay any tax or other charge imposed in connection with
any transfer involved in the issue of any certificate for the Warrant Shares
or any portion thereof in any name other than that of the registered holder
of the Warrant surrendered in connection with the purchase of such shares,
and in such case the Company shall not be required to issue or deliver any
certificate until such tax or other charge has been paid or it has been
established to the Company's satisfaction that no tax or other charge is due.
1.5 TRANSFER AND EXCHANGE.
(a) Subject to the terms hereof, including, without
limitation, Section 2.1, the Warrant and all rights thereunder are
transferable, in whole or in part, on the books of the Company maintained for
such purpose at its office designated in Section 5.4 hereof by the registered
holder hereof in person or by duly authorized attorney, upon surrender of the
Warrant properly endorsed and upon payment of any necessary transfer tax or
other governmental charge
(2)
imposed upon such transfer. Upon any partial transfer, the Company will issue
and deliver to such holder a new warrant or warrants with respect to the
Warrant Shares not so transferred. Each taker and holder of the Warrant, by
taking or holding the same, consents and agrees that the Warrant when
endorsed in blank shall be deemed negotiable, and that when the Warrant shall
have been so endorsed, the holder may be treated by the Company and all other
persons dealing with the Warrant as the absolute owner of such Warrant for
any purpose and as the person entitled to exercise the rights represented
thereby, or to the transfer on the books of the Company, any notice to the
contrary notwithstanding; but until such transfer on such books, the Company
may treat the registered holder of the Warrant as the owner for all purposes.
The term "Warrant" as used herein shall include the Warrant and, any warrants
delivered in substitution or exchange therefor as provided herein.
(b) The Warrant is exchangeable for a warrant or warrants for
the same aggregate number of Warrant Shares, each new Warrant to represent
the right to purchase such number of shares as the holder shall designate at
the time of such exchange.
2. TRANSFER OF SECURITIES.
2.1 RESTRICTIONS OF TRANSFER. Neither the Warrant nor the
Warrant Shares shall be transferable except upon the conditions specified in
this Section 2.1, which conditions are intended to insure compliance with the
provisions of the Securities Act of 1933 (the "1933 Act") in respect to the
transfer of the Warrant and the Warrant Shares.
(a) Unless and until otherwise permitted by this Section
2.1, the Warrant and each certificate or other document evidencing any of the
Warrant Shares shall be endorsed with a legend substantially in the following
form:
"THESE SECURITIES HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
AND MAY NOT BE SOLD, PLEDGED OR OTHERWISE
TRANSFERRED UNLESS (A) COVERED BY AN EFFECTIVE
REGISTRATION STATEMENT UNDER SUCH ACT, (B) IN
COMPLIANCE WITH RULE 144 UNDER SUCH ACT, OR (C)
THE COMPANY HAS BEEN FURNISHED WITH AN OPINION
OF COUNSEL REASONABLY ACCEPTABLE TO THE COMPANY
TO THE EFFECT THAT NO REGISTRATION IS REQUIRED
FOR SUCH TRANSFER."
(b) Neither the Warrant nor the Warrant Shares shall be
transferred, and the Company shall not be required to register any such
transfer, unless and until one of the following events shall have occurred:
(i) the Company shall have received an opinion of
counsel, in form and substance reasonably acceptable to the Company and its
counsel, stating that the contemplated transfer is exempt from registration
under the 1933 Act as then in effect, and the Rules and Regulations of the
Securities and Exchange Commission (the "Commission") thereunder. Within five
business days after delivery to the Company and its counsel of such an
(3)
opinion, the Company either shall deliver to the proposed transferor a
statement to the effect that such opinion is not satisfactory in the
reasonable opinion of its counsel (and shall specify in detail the legal
analysis supporting any such conclusion) or shall authorize the Company's
transfer agent to make the requested transfer;
(ii) the Company shall have been furnished with a letter
from the Commission in response to a written request in form and substance
acceptable to counsel for the Company setting forth all of the facts and
circumstances surrounding the contemplated transfer, stating that the
Commission will take no action with regard to the contemplated transfer;
(iii) the Warrant or the Warrant Shares are
transferred pursuant to a registration statement which has been filed with
the Commission and has become effective; or
(iv) the Warrant or the Warrant Shares are transferred in
accordance with the provisions of Rule 144 promulgated by the Commission
under the 1933 Act.
(c) The restrictions on transfer imposed by this Section 2.1
shall cease and terminate as to the Warrant and the Warrant Shares when (i)
such securities shall have been effectively registered under the 1933 Act and
sold by the holder thereof in accordance with such registration, (ii) an
acceptable opinion as described in Section 2.1(b)(i) or a "no action" letter
described in Section 2.1(b)(ii) states that future transfers of such
securities by the transferor or the contemplated transferee would be exempt
from registration under the 1933 Act, or (iii) such securities may be sold in
accordance with the provisions of Rule 144 promulgated under the 1933 Act.
When the restrictions on transfer contained in this Section 2.1 have
terminated as provided above, the holder of the securities as to which such
restrictions shall have terminated or the transferee of such holder shall be
entitled to receive promptly from the Company, without expense to him, new
certificates not bearing the legend set forth in Section 2.1(a) hereof.
2.2 COOPERATION. The Company shall cooperate in supplying such
information as may be reasonably requested by the Warrantholder to complete
and file any information reporting forms presently or subsequently required
by the Commission as a condition to the availability of an exemption,
presently existing or subsequently adopted, from the 1933 Act for the sale of
the Warrant or the Warrant Shares.
3. REGISTRATION RIGHTS.
3.1 RIGHTS OF WARRANTHOLDERS. Holders of the Common Stock issued
or issuable upon exercise of this Warrant (collectively, the "Registrable
Securities") shall have "piggyback" registration rights as set forth below:
(a) If, at any time, through and including the third anniversary
of the date of this Warrant, the Company proposes to register any of its
securities under the Act (other than in connection with a merger,
acquisition, reorganization or similar transaction pursuant to a Form S-4
Registration Statement or an employee stock compensation plan pursuant to a
Form S-8 Registration Statement), it will give written notice by registered
(4)
mail, at least (30) days prior to the filing of each such registration
statement, to the Holder of its intention to do so. If the Holder
notifies the Company within 20 days after receipt of any such notice of
its desire to include any Registrable Securities in such proposed
registration statement, the Company shall afford such Holder the
opportunity to have any of the Registrable Securities registered under
such registration statement and included in any underwriting involved
with respect thereto.
(b) Notwithstanding the provisions of Section 3 hereof: (i)
the Company shall have the right at any time after it shall have given
written notice pursuant to this Section 3 (irrespective of whether a
written request for inclusion of any Registrable Securities shall have
been made) to elect not to file any such proposed registration
statement, or to withdraw the same after the filing but prior to the
effective date thereof; and (ii) in the event a registration under
Section 3 hereof relates to an underwritten public offering which does
not include any securities being offered and sold on behalf of selling
shareholders, the inclusion of any Registrable Securities may, at the
election of the Company, be conditioned upon the Holder agreeing that
the public offering of such Registrable Securities shall not commence
until 90 days after the effective date of such registration.
(c) The rights of the Holder pursuant to Section 3 hereof
shall be conditioned upon such Holder's participation in the
underwriting with respect thereto and the inclusion of such Holder's
Registrable Securities in such underwriting (unless otherwise mutually
agreed by the Company, the managing underwriter or, if none, a majority
of the underwriters, and such Holder) to the extent provided herein.
(d) Notwithstanding any other provision of this Warrant, if
the managing underwriter or, if none, a majority of the underwriters,
determines that marketing factors require a limitation of the number of
shares to be underwritten or a complete exclusion of such shares, such
underwriter or underwriters may limit the number of Registrable
Securities that may be included in the registration and underwriting or
exclude all of the Registrable Securities, as appropriate. In the case
of an underwritten registration in which the number of Registrable
Securities that may be included is limited, the Company shall advise the
Holder of the limited number of Registrable Securities that may be
included in the registration, and the number of Registrable Securities
that may be included in the registration and underwriting shall be
allocated among all Holders thereof in proportion, as nearly as
practicable, to the respective amounts of Registrable Securities
entitled to inclusion in such registration held by such Holders at the
time of filing the registration statement.
(e) The Company shall (together with all Holders proposing to
distribute their securities through an underwriting) enter into an
underwriting agreement in customary form with the underwriter or
underwriters selected for the underwriting.
(5)
3.2 EXPENSES.
All expenses incurred in connection with any registration
pursuant to this Warrant or Warrant Shares, including without limitation, all
registration, filing and qualification fees, printing expenses, fees and
disbursements of counsel for the Company, and expenses of any special audits
incidental to or required by such registration, shall be borne by the
Company; provided however the Company shall not be required to pay:
(a) fees of legal counsel of any Holder, or underwriters'
fees, discounts, commissions or expenses relating to Registrable
Securities; and
(b) for expenses that the Company is prohibited from paying
under Blue Sky laws or by Blue Sky administrators.
3.3 COMPANY RESPONSIBILITIES.
In the case of a piggyback registration of Warrant Shares, the
Company shall use its best efforts to keep the Holder advised in writing as
to the initiation, effectiveness and completion of such registration. At its
expense the Company shall:
(a) prepare and file a registration statement (and such
amendments and supplements thereto) with respect to such Registrable
Securities and use its best efforts to cause such registration statement
to become and remain effective for a period of 180 days or until the
Holder or Holders have completed the distribution described in the
registration statement relating thereto, whichever first occurs;
(b) furnish such number of copies of a Prospectus in
conformity with the requirements of applicable law, and such other
documents incident thereto as a Holder from time to time may reasonably
request; and
(c) use every reasonable effort to register or qualify the
Registrable Securities covered by such registration statement under the
state Blue Sky laws of such jurisdictions as the Company's Board of
Directors may reasonably determine, and do any and all other acts and
things which may be necessary under said Blue Sky laws to enable the
sellers of the Registrable Securities to consummate the public sale or
other disposition of the Registrable Securities owned by them in such
jurisdictions, except that the Company shall not for any purpose be
required to qualify to do business as a foreign corporation in any
jurisdiction wherein the Registrable Securities are so qualified.
3.4 INDEMNIFICATION.
(a) The Company shall indemnify the Holder, with respect to such
registration effected pursuant to Section 3 hereof, against all claims,
losses, damages and liabilities (or actions in respect thereto) arising
out of or based on any untrue statement
(6)
(or alleged untrue statement) of a material fact contained in any
registration statement or related Prospectus, or based on any omission
(or alleged omission) to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading, or any violation by the Company of any rule or regulation
promulgated under any securities law applicable to the Company and
relating to action or inaction required of the Company in connection
with any such registration, and shall reimburse the Holder and each
person who controls any such underwriter, for any legal and any other
expenses reasonably incurred in connection with investigating or
defending any such claim, loss, damage, liability or action, provided
that the Company shall not be liable in any such case to the extent that
any such claim, loss, damage or liability arises out of or is based on
any untrue statement or omission based upon written information
furnished to the Company in an instrument duly executed by such Holder
specifically for use therein.
(b) The Holder shall, if Registrable Securities held by or
issuable to the Holder are included in the securities as to which such
registration is being effected, indemnify the Company, each of its
directors and officers who sign such registration statement, each
underwriter, if any, of the Company's securities covered by such a
registration statement, each person who controls the Company within the
meaning of the Act, and each other Holder, against all claims, losses,
damages and liabilities (or actions in respect thereof) arising out of
or based on any untrue statement (or alleged untrue statement) of a
material fact contained in any such registration statement or related
Prospectus, or any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, and shall reimburse the Company and
such Holders for any legal or any other expenses reasonably incurred in
connection with investigating or defending any such claim, loss, damage,
liability, or action, in each case to the extent, but only to the
extent, that such untrue statement (or alleged untrue statement) or
omission (or alleged omission) is made in such registration statement or
related Prospectus in reliance upon and in conformity with written
information furnished to the Company in an instrument duly executed by
such Holder specifically for use therein.
(c) Each party entitled to indemnification under this Section 3.4
(the "Indemnified Party") shall give notice to the party required to
provide indemnification (the "Indemnifying Party") promptly after such
Indemnified Party has actual knowledge of any claim as to which
indemnity may be sought, and shall permit the Indemnifying Party to
assume the defense of any such claim or any litigation resulting
therefrom, provided that counsel for the Indemnifying Party, who shall
conduct the defense of such claim or litigation, shall be approved by
the Indemnified Party (whose approval shall not be unreasonably
withheld), and the Indemnified Party may participate in such defense at
such party's expense; and provided further that the failure of any
Indemnified Party to give notice as provided herein shall not relieve
the Indemnifying Party of its obligations under this Section 3.4. No
Indemnifying Party, in the defense of any such claim or litigation,
shall, except with the consent of each Indemnified Party, consent to
entry of any judgment or enter into any settlement, which does not
include as an unconditional
(7)
term thereof, the giving by the claimant or plaintiff to such Indemnified
Party of a release from all liability in respect to such claim or
litigation.
3.5 HOLDER'S OBLIGATIONS. The Holder shall furnish to the Company
such written information regarding such Holder and the distribution proposed by
such Holder as the Company may reasonably request in writing and as shall be
required in connection with any registration referred to in this Warrant
3.6 ASSIGNMENT. The rights granted to the Holder pursuant to this
Warrant may be assigned to a transferee or assignee of the Warrant or any of
the Registrable Securities, provided that the transferee or assignee is an
affiliated entity of the Holder and the Company is given written notice at
the time of or within 10 days after said transfer, stating the name and
address of said transferee or assignee and identifying the Registrable
Securities with respect to which such registration rights are being assigned.
4. ADJUSTMENTS TO EXERCISE PRICE AND WARRANT SHARES. The Exercise
Price in effect from time to time and the number of Warrant Shares shall be
subject to adjustment in certain cases as set forth in this Section 4.
4.1 SUBDIVISION OR COMBINATION. In the event the outstanding
Common Stock shall be subdivided into a greater number of shares of Common
Stock, the Exercise Price for the Warrant Shares shall, simultaneously with
the effectiveness of such subdivision, be proportionately reduced and the
number of Warrant Shares proportionately increased, and conversely, in case
the outstanding Common Stock shall be combined into a smaller number of
shares of Common Stock, the Exercise Price shall, simultaneously with the
effectiveness of such combination, be proportionately increased and the
number of Warrant Shares proportionately reduced.
4.2 ADJUSTMENT FOR REORGANIZATION, CONSOLIDATION, MERGER.
(a) In case of any reorganization of the Company (or any other
corporation the stock or other securities of which are at the time receivable
on the exercise of the Warrant) after the date on which this Warrant is first
issued (the "Issuance Date"), or in case, after such date, the Company (or
any such other corporation) shall consolidate with or merge into another
corporation or convey all or substantially all of its assets to another
corporation, then and in each such case the Warrantholder, upon exercise of
the Warrant as provided in Section 1.2 hereof at any time after the
consummation of such reorganization, consolidation, merger or conveyance,
shall be entitled to receive, in lieu of the stock or other securities and
property receivable upon the exercise of the Warrant prior to such
consummation, the stock or other securities or property to which the
Warrantholder would have been entitled upon such consummation if the
Warrantholder had exercised or converted the Warrant immediately prior
thereto; in each such case, the terms of this Warrant, including the exercise
provisions of Sections 1.2, shall be applicable to the shares of stock or
other securities or property receivable upon the exercise or conversion of
the Warrant after such consummation.
(8)
(b) The Company shall not effect any consolidation, merger
or conveyance of all or substantially all of its assets unless prior to the
consummation thereof the successor corporation (if other than the Company)
resulting from such consolidation or merger or the corporation into or for
the securities of which the previously outstanding stock of the company shall
be changed in connection with such consolidation or merger, or the
corporation purchasing such assets, as the case may be, shall assume by
written instrument, in form and substance satisfactory to the Warrantholder,
executed and delivered in accordance with Section 5.4 hereof, the obligation
to deliver to the Warrantholder such shares of stock, securities or assets
as, in accordance with the foregoing provisions, the Warrantholder is
entitled to purchase.
(c) If a purchase, tender or exchange offer is made to and
accepted by the holders of more than 50% of the outstanding shares of Common
Stock of the Company, the Company shall not effect any consolidation, merger
or sale with the Person having made such offer or with any Affiliate of such
Person, unless prior to consummation of such consolidation, merger or sale
the Warrantholder shall have been given a reasonable opportunity to then
elect to receive either the stock, securities or assets then issuable upon
the exercise or conversion of the Warrant or, if different, the stock,
securities or assets, or the equivalent, issued to previous holders of the
Common Stock in accordance with such offer, computed as though the
Warrantholder hereof had been, at the time of such offer, a holder of the
stock, securities or assets then purchasable upon the exercise or conversion
of the Warrant. As used in this paragraph (c), the term "Person" shall mean
and include an individual, a partnership, a corporation, a trust, a joint
venture, an unincorporated organization and a government or any department or
agency thereof, and an "Affiliate" of any Person shall mean any Person
directly or indirectly controlling, controlled by or under direct or indirect
common control with, such other Person. A Person shall be deemed to control a
corporation if such Person possesses, directly or indirectly, the power to
direct or cause the direction of the management and policies of such
corporation, whether through the ownership of voting securities, by contract
or otherwise.
4.3 MISCELLANEOUS EXERCISE MATTERS. The Company shall at all times
reserve and keep available out of its authorized but unissued Common Stock
the full number of Warrant Shares deliverable upon exercise of the Warrant
Shares, as such number may change from time to time. Also, the Company shall,
at its own expense, take all such actions and obtain all such permits and
orders as may be necessary to enable the Company lawfully to issue the
Warrant Shares upon the exercise of the Warrant.
4.4 NO DILUTION OR IMPAIRMENT. The Company will not, by amendment
of its certificate of incorporation or through reorganization, consolidation,
merger, dissolution, issue or sale of securities, sale of assets or any other
voluntary action, avoid or seek to avoid the observance or performance of any
of the terms of the Warrant, but will at all times in good faith assist in
the carrying out of all such terms and in the taking of all such actions as
may be necessary or appropriate in order to protect the rights of the
Warrantholder against dilution or other impairment. Without limiting the
generality of the foregoing, the Company will take all such action as may be
necessary or appropriate in order that the Company may validly and legally
issue fully paid and non-assessable shares upon the exercise or conversion of
the Warrant.
(9)
4.5 NOTICE OF ADJUSTMENT. When any adjustment is required to be
made in either the Exercise Price or the number of shares issuable upon
exercise of the Warrant, the Company shall promptly notify the Warrantholder
of such event, of the calculation by which such adjustment is to be made and
of the resulting Exercise Price or conversion rate, as the case may be.
4.6 DUTY TO MAKE FAIR ADJUSTMENTS IN CERTAIN CASES. If any event
occurs as to which in the opinion of the Board of Directors the other
provisions of this Section 4 are not strictly applicable or if strictly
applicable would not fairly protect the purchase and exercise rights of the
Warrant in accordance with the essential intent and principles of such
provisions, then the Board of Directors shall make an adjustment in the
application of such provisions, in accordance with such essential intent and
principles, so as to protect such purchase rights as aforesaid.
5. MISCELLANEOUS.
5.1 ENTIRE AGREEMENT. This Warrant constitutes the full and entire
understanding and agreements between the parties hereto with respect to the
subjects hereof and thereof.
5.2 SUCCESSORS AND ASSIGNS. The terms and conditions of this
Warrant shall inure to the benefit of and be binding upon the respective
successors and assigns of the parties hereto, except as expressly provided
otherwise herein.
5.3 GOVERNING LAW. This Warrant shall be governed by and construed
under the laws of the State of California.
5.4 NOTICES, ETC. All notices and other communications required
or permitted hereunder shall be in writing and shall be deemed effectively
given upon personal delivery or upon the seventh day following mailing by
registered air mail, postage prepaid, addressed (a) if to the Warrantholder,
at __________________________________________, or at such other address as it
shall have furnished to the Company in writing, (b) if to the Company, a copy
should be sent to its address set forth on the signature page of this
Agreement and addressed to the attention of the corporate secretary, or at
such other address as the Company shall have furnished in writing to the
Warrantholder, or (c) if to any other holder of any Warrant or of Warrant
Shares issued upon conversion of the Warrant, at such address as such holder
shall have furnished to the Company in writing, or, until such holder so
furnishes an address to the Company, then to and at the address of the last
holder of such Warrant or Warrant Shares who so furnished an address to the
Company.
5.5 DELAYS OR OMISSIONS. No delay or omission to exercise any
right, power or remedy accruing to any holder of any securities issued or
sold or to be issued or sold hereunder, upon any breach or default of the
Company under this Agreement, shall impair any such right, power or remedy of
such holder nor shall it be construed to be a waiver of any such breach or
default, or an acquiescence therein, or in any similar breach or default
thereafter occurring, nor shall any waiver of any single breach or default be
deemed a waiver of any other breach or
(10)
default theretofore or thereafter occurring. Any waiver, permit, consent or
approval of any kind or character on the part of any holder of any breach or
default under this Agreement, or any waiver on the part of any holder of any
provisions or conditions of this Agreement, must be in writing and shall be
effective only to the extent specifically set forth in such writing. All
remedies, either under this Agreement or by law or otherwise afforded to any
holder, shall be cumulative and not alternative.
5.6 SURVIVAL. The representations, warranties, covenants and
agreements made herein and or made pursuant to this Agreement shall survive
the execution and delivery of this Agreement, except as expressly provided
otherwise herein.
5.7 WAIVERS AND AMENDMENTS. With the written consent of the record
or beneficial holders of more than 50% of the Warrant Shares (treated as if
converted), the obligations of the Company and the rights of the holders of
the Warrant and the Warrant Shares may be waived (either generally or in a
particular instance, either retroactively or prospectively and either for a
specified period of time or indefinitely), and with the same consent the
Company, when authorized by resolution of its Board of Directors, may enter
into a supplemental agreement for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Warrant;
provided, however, that no such waiver or supplemental agreement shall reduce
the aforesaid percentage of the Warrant Shares, the holders of which are
required to consent to any waiver or supplemental agreement, without the
consent of the record or beneficial holders of all of the Warrant Shares
(treated as if converted). Upon the effectuation of each such waiver,
consent, agreement of amendment or modification, the Company promptly shall
give written notice thereof to the record holders of the Warrant and the
Warrant Shares. This Warrant or any provision hereof may not be changed,
waived, discharged or terminated orally, but only by a statement in writing
signed by the party against which enforcement of the change, waiver,
discharge or termination is sought, except to the extent provided in this
Section 5.7.
5.8 SEVERABILITY. If one or more provisions of this Warrant are
held to be invalid, illegal or unenforceable under applicable law, such
provision shall be modified in such manner as to be valid, legal and
enforceable, but so as to most nearly retain the intent of the parties, and
if such modification is not possible, such provision shall be severed from
this Agreement as if such provision were not included, in either case, and
the balance of this Warrant shall not in any way be affected or impaired
thereby and shall be enforceable in accordance with its terms.
5.9 REGISTERED HOLDER. The Company may deem and treat the
registered Holder(s) hereof as the absolute owner(s) of this Warrant
(notwithstanding any notation of ownership or other writing hereon made by
anyone), for the purpose of any exercise or conversion hereof, of any
distribution to the Holder(s) hereof, and for all other purposes, and the
Company shall not be affected by any notice to the contrary. Other than as
set forth herein, this Warrant does not entitle any Holder hereof to any
rights of a stockholder of the Company.
(11)
5.10 TITLES AND SUBTITLES. The titles of the sections and
subsections of this Warrant are for convenience and are not to be considered
in construing this Warrant.
IN WITNESS WHEREOF, Company has caused this Warrant to be signed by
its duly authorized officer and issued as of the date set forth below.
Dated: __________________
ANCHOR PACIFIC UNDERWRITERS, INC.
By:________________________________
Its:_______________________________
(12)
EXERCISE NOTICE
(To be executed only upon exercise of Warrant)
The undersigned registered owner of a Warrant of ANCHOR PACIFIC
UNDERWRITERS, INC. (the "Company"), originally issued to ______________________
_________________________ irrevocably exercises such Warrant for the purchase
of shares of Common Stock of the Company, purchasable with the Warrant, and
hereby sets the place and date for the closing of such purchase as follows,
all on the terms and conditions specified in the Warrant.
Place of Closing ______________________
Date of Closing _______________________
The undersigned requests that a certificate for such shares be
registered in the name of _____________________________________________________,
whose address is__________________________________________________. If said
number of shares is less than all of the shares of Common Stock purchasable
under the Warrant, the undersigned requests that a new Warrant representing
the remaining balance of such shares be registered in the name of
_____________________________________________________________, whose address
is ____________________________________________________.
Dated:______________________
_________________________________________
Signature of Registered Owner
_________________________________________
Street Address
_________________________________________
City State Zip
(13)
FORM OF ASSIGNMENT
FOR VALUED RECEIVED, the undersigned registered owner of this
Warrant issued by ANCHOR PACIFIC UNDERWRITERS, INC. hereby sells, assigns and
transfers unto the Assignee named below all of the rights of the undersigned
under the within Warrant, with respect to the number of Shares of Common
Stock set forth below:
NAME OF ASSIGNEE ADDRESS NO. OF SHARES
and does hereby irrevocably constitute and appoint______________________________
_____________________________________attorney to make such transfer on the books
of ________________________, maintained for such purpose, with full power of
substitution in the premises.
Dated:_____________________
_________________________________________
Signature of Registered Owner
_________________________________________
Witness
BBMSF1: 161340
37353-0100
(14)