EXHIBIT 5
COMMON STOCK PURCHASE WARRANT
Dated as of ______________, 1998
Superior National Insurance Group, Inc., a Delaware corporation
(the "Company"), for value received, hereby certifies that [ ] ("[ ]"), is
entitled to purchase from the Company [ ] duly authorized, validly issued, fully
paid and non-assessable shares of Common Stock (as defined in Section 14 herein)
at the purchase price per share of $16.75, at any time or from time to time
prior to 5:00 p.m. Pacific time, on __________, 2003 (or such later date as may
be determined pursuant to Section 19), all subject to the terms, conditions and
adjustments set forth below in this Warrant, and is entitled to exercise the
other rights, powers and privileges hereinafter specified.
This Warrant constitutes (or has been issued in exchange or
substitution for, or upon registration of transfer of one of) one of the Common
Stock Purchase Warrants issued and delivered pursuant to the Stock Purchase
Agreement (the "Stock Purchase Agreement"), dated as of May 5, 1998, among the
Company, Insurance Partners, L.P., Insurance Partners Offshore (Bermuda), L.P.
and Capital Z Partners, Ltd. The Stock Purchase Agreement is available for
inspection by the holder of this Warrant during normal business hours at the
office or agency maintained by the Company pursuant to Section 12 and at the
principal office of the Company referred to in, or notice of which is given by
the Company pursuant to, Section 17, and, upon request therefor, the Company
will furnish to the holder of this Warrant a true and complete copy of the Stock
Purchase Agreement as in effect at the time. All the Warrants, as originally so
issued, evidenced the right to purchase an aggregate of 734,000 shares of Common
Stock, subject to adjustment as provided herein. The term "Warrants," when used
herein, means this Warrant and all Warrants issued in exchange or substitution
therefor or upon registration of transfer hereof. The Warrants, although issued
in connection with the issuance and sale of shares of Common Stock pursuant to
the Stock Purchase Agreement (the "Purchase Shares") and although containing
provisions that refer to the Stock Purchase Agreement, are detachable warrants
and, accordingly, are exercisable and transferable (subject to compliance with
Section 8, if applicable) without presentation of any of the Purchase Shares.
Certain terms used in this Warrant are defined in Section 14.
SECTION 1. EXERCISE OF WARRANT
ss. 1.1 Manner of Exercise. This Warrant may be exercised by the
holder hereof, in whole or in part, during normal business hours on any Business
Day by surrender of this Warrant, with the form of subscription at the end
hereof or
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a reasonable facsimile thereto duly executed by such holder, to the Company at
the office or agency maintained by the Company pursuant to Section 12,
(a) accompanied by payment, in cash or by certified or
official bank check payable to the order of the Company, in the amount (the
"Exercise Price") obtained by multiplying (i) the number of shares of Common
Stock (without giving effect to any adjustment therein) designated in such form
of subscription (or such reasonable facsimile) by (ii) $16.75, and such holder
shall thereupon be entitled to receive the number of duly authorized, validly
issued, fully paid and non-assessable shares of Common Stock (or Other
Securities) determined as provided in Section 2; or
(b) accompanied by a notice to exercise its Cashless Exercise
Right (as defined herein). The holder hereof shall have the right to require the
Company to reduce the number of shares of Common Stock to be received by such
holder in lieu of paying the Exercise Price (the "Cashless Exercise Right"). If
the Cashless Exercise Right is exercised, the holder shall not be obligated to
pay the Exercise Price and the Company shall deliver to such holder (without
payment by such holder of any of the Exercise Price) the number of duly
authorized, validly issued, fully paid and non-assessable shares of Common Stock
(or Other Securities) determined by Section 2 reduced by that number of shares
of Common Stock (or Other Securities) equal to the quotient obtained by dividing
(i) the Exercise Price by (ii) the Market Price of one share of Common Stock (or
Other Securities) on the Business Day next preceding the date of exercise of the
Cashless Exercise Right; or
(c) accompanied by a notice to exercise its In-Kind Exercise
Right (as defined herein). The holder shall have the right to pay the Exercise
Price with shares of Common Stock (the "In-Kind Exercise Right") that either
accompany the notice or are acquired concurrently therewith pursuant to
paragraph (a), (b) or this paragraph (c). For purposes of this paragraph, any
share of Common Stock used to pay the Exercise Price shall be deemed to have a
value equal to the Market Price of one share of Common Stock on the Business Day
next preceding the date of exercise of the In-Kind Exercise Right.
ss. 1.2 When Exercise Effective. Each exercise of this Warrant
shall be deemed to have been effected immediately prior to the close of business
on the Business Day on which this Warrant shall have been surrendered as
provided in ss. 1.1, and immediately prior to the close of business on such
Business Day the Person or Persons in whose name or names any certificate or
certificates for shares of Common Stock (or Other Securities) shall be issuable
upon such exercise as provided in ss. 1.3 shall be deemed to have become the
holder or holders of record thereof.
ss. 1.3 Delivery of Stock Certificate, etc. As soon as practicable
after the exercise of this Warrant in whole or in part, and in any event within
five Business Days thereafter, the Company at its expense (including the payment
by it of any
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applicable issue taxes) will cause to be issued in the name of and delivered to
the holder hereof or, subject to Section 8, as such holder (upon payment by such
holder of any applicable transfer taxes) may direct,
(a) a certificate or certificates for the number of fully paid
and non-assessable shares of Common Stock (or Other Securities) to which
such holder shall be entitled upon such exercise plus, in lieu of any
fractional share to which such holder would otherwise be entitled, cash
in an amount equal to the same fraction (calculated to the nearest
1/100th of a share) of the Market Price of one full share on the
Business Day next preceding the date of such exercise, and
(b) in case such exercise is in part only, a new Warrant or
Warrants of like tenor, calling in the aggregate on the face or faces
thereof for the number of shares of Common Stock equal (without giving
effect to any adjustment therein) to the number of such shares called
for on the face of this Warrant minus the number of such shares
designated by the holder upon such exercise as provided in ss. 1.1.
ss. 1.4 Company to Reaffirm Obligations. The Company will, at the
time of each exercise of this Warrant, acknowledge in writing its continuing
obligation to afford to such holder all rights to which such holder shall
continue to be entitled after such exercise in accordance with the terms of this
Warrant; provided, however, that if the Company shall fail to make any such
written acknowledgment, such failure shall not affect the continuing obligation
of the Company to afford such rights to such holder.
ss. 1.5 Compliance with Law, etc. Each exercise of this Warrant
shall at all times be subject to the provisions of any applicable law relating
to the rights of non-citizens of the United States of America or other classes
of Persons to own shares of the Company.
SECTION 2. ADJUSTMENT OF COMMON STOCK ISSUABLE
UPON EXERCISE OF WARRANT
ss. 2.1 General; Warrant Price. The number of shares of Common
Stock which the holder of this Warrant shall be entitled to receive upon the
exercise hereof shall be determined by multiplying the number of shares of
Common Stock which would otherwise (but for the provisions of this Section 2) be
issuable upon such exercise, as designated by the holder hereof pursuant to ss.
1.1, by the fraction of which (a) the numerator is $16.75 and (b) the
denominator is the Warrant Price (as defined below in this ss. 2.1) in effect on
the date of such exercise. If a holder exercises a Cashless Exercise Right, the
number of shares of Common Stock such holder shall be entitled to receive upon
exercise of the warrant shall be reduced in accordance with Section 1.1(b). The
"Warrant Price" per share of Common Stock shall initially be
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$16.75, shall be adjusted and readjusted from time to time as provided in this
Section 2 and, as so adjusted or readjusted, shall remain in effect until a
further adjustment or readjustment thereof is required by this Section 2.
ss. 2.2 Adjustment of Warrant Price.
ss. 2.2.1 In case the Company, at any time or from time to time
after the Closing Date shall issue or sell Additional Shares of Common Stock
(including Additional Shares of Common Stock deemed to be issued pursuant to
▇▇.▇▇. 2.3 or 2.4) without consideration or for a consideration per share less
than the Current Market Price in effect immediately prior to such issue or sale,
then, and in each such case, such Warrant Price shall be reduced, concurrently
with such issue or sale, to a price (calculated to the nearest cent) determined
by multiplying such Warrant Price by a fraction:
(a) the numerator of which shall be the number of shares of
Common Stock outstanding, which number shall for purposes of this ss.
2.2.l(a) include the Common Stock Deemed to be Outstanding, immediately
prior to such issue or sale, plus the number of shares of Common Stock
which the aggregate consideration received by the Company for the total
number of such Additional Shares of Common Stock so issued or sold would
purchase at the greater of such Current Market Price and such Warrant
Price; and
(b) the denominator of which shall be the number of shares of
Common Stock outstanding, which number shall for purposes of this ss.
2.2. l(b) include the Common Stock Deemed to be Outstanding, immediately
after such issue or scale;
provided, however, that for the purposes of this ss. 2.2.1, treasury shares
shall not be deemed to be outstanding; and provided, further, that if any such
Additional Shares of Common Stock are issued pursuant to a binding agreement
entered into prior to the date of issuance of such shares and the per share
consideration to be paid by the purchaser for each such Additional Share of
Common Stock under such agreement is at least eighty-five percent (85%) of the
Market Price per share of Common Stock on the Business Day next preceding the
date such agreement is entered into by the parties thereto, then no adjustment
shall be made to the Warrant Price pursuant to this ss. 2.2.1.
ss. 2.2.2 In case the Company, at any time or from time to time
after the Closing Date, shall declare, order, pay or make a dividend or other
distribution (including, without limitation, any distribution of other or
additional stock or other securities or property or Options by way of dividend
or spin-off, reclassification, recapitalization, merger or consolidation in
which the Company is the continuing or resulting corporation, or similar
corporate rearrangement) on the Common Stock, other
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than (a) a dividend payable in Additional Shares of Common Stock for which an
adjustment has been made pursuant to ss. 2.2.1 hereof and (b) regular periodic
cash dividends declared out of earned surplus of the Company in an aggregate
amount not greater than fifty cents ($.50) per share of Common Stock per annum
(as adjusted for any stock split, combination, reclassification or similar
events with respect to the Common Stock), then, and in each such case, the
Warrant Price in effect immediately prior to the close of business on the record
date fixed for the determination of the Persons entitled to receive such
dividend or distribution shall be adjusted, effective as of the close of
business on such record date, to a price (calculated to the nearest cent)
determined by multiplying such Warrant Price by a fraction:
(i) the numerator of which shall be the Current Market
Price in effect on such record date less the amount of such dividend
or distribution (as determined in good faith by the Board of
Directors of the Company) applicable to one share of Common Stock;
and
(ii) the denominator of which shall be such Current Market
Price.
ss. 2.3 Options and Convertible Securities. In case the Company,
at any time or from time to time after the Closing Date, shall issue, sell,
grant or assume, or shall fix a record date for the determination of holders of
any class of securities entitled to receive, any Options (other than those
provided for and reserved pursuant to the Stock Option Plan as of the date of
the original issuance of this Warrant) or Convertible Securities, then, and in
each such case, the maximum number of shares (as set forth in the instrument
relating thereto without regard to any provisions contained therein for a
subsequent adjustment of such number) of Common Stock issuable upon the exercise
of such Options or, in the case of Convertible Securities and Options therefor,
the conversion or exchange of such Convertible Securities, shall be deemed to be
Additional Shares of Common Stock issued as of the time of such issue, sale,
grant or assumption or, in case such a record date shall have been fixed, as of
the close of business on such record date; provided, however, that Additional
Shares of Common Stock shall not be deemed to have been issued unless the
consideration per share (determined in accordance with ss. 2.5) of such shares
would be less than the Current Market Price in effect on the date of and
immediately prior to such issue, sale, grant or assumption or immediately prior
to the close of business on such record date, as the case may be, and provided,
further, that in any such case in which Additional Shares of Common Stock are
deemed to be issued:
(a) no further adjustment of the Warrant Price shall be made
upon the subsequent issue or sale of Convertible Securities or shares of
Common Stock upon the exercise of such Options or the conversion or
exchange of such Convertible Securities;
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(b) if such Options or Convertible Securities by their terms
provide, with the passage of time or otherwise, for any increase or
decrease in the consideration payable to the Company, or any increase or
decrease in the number of shares of Common Stock issuable, upon the
exercise, conversion or exchange thereof (by change of rate or
otherwise), the Warrant Price computed upon the original issue, sale,
grant or assumption thereof (or upon the occurrence of a record date
with respect thereto), and any subsequent adjustments based thereon,
shall, upon any such increase or decrease becoming effective, be
recomputed to reflect such increase or decrease insofar as it affects
such Options, or the rights of conversion or exchange under such
Convertible Securities, which are outstanding at such time;
(c) upon the expiration (or purchase by the Company and
cancellation) of any such Options or any rights of conversion or
exchange under such Convertible Securities which shall not have been
exercised, the Warrant Price computed upon the original issue, sale,
grant or assumption thereof (or upon the occurrence of a record date
with respect thereto), and any subsequent adjustments based thereon,
shall, upon such expiration (or such cancellation, as the case may be),
be recomputed as if:
(i) in the case of Convertible Securities or Options for
Common Stock, the only Additional Shares of Common Stock issued or
sold were the shares of Common Stock, if any, actually issued or
sold upon the exercise of such Options or the conversion or exchange
of such Convertible Securities and the consideration received
therefor was the consideration actually received by the Company for
the issue, sale, grant or assumption of all such Options, whether or
not exercised, plus the consideration actually received by the
Company upon such exercise, or for the issue or sale of all such
Convertible Securities which were actually converted or exchanged,
plus the additional consideration, if any, actually received by the
Company upon such conversion or exchange; and
(ii) in the case of Options for Convertible Securities,
only the Convertible Securities, if any, actually issued or sold
upon the exercise thereof were issued at the time of the issue,
sale, grant or assumption of such Options, and the consideration
received by the Company for the Additional Shares of Common Stock
deemed to have then been issued was the consideration actually
received by the Company for the issue, sale, grant or assumption of
all such Options, whether or not exercised, plus the consideration
deemed to have been received by the Company (in accordance with ss.
2.5) upon the issue or sale of the Convertible Securities in respect
of the issue, sale, grant or assumption of such Options or
Convertible Securities; and
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(d) no readjustment pursuant to clause (b) or (c) above shall
have the effect of increasing the Warrant Price by an amount in excess of the
amount of the adjustment thereof originally made in respect of the issue, sale,
grant or assumption of such Options or Convertible Securities.
ss. 2.4 Stock Dividends, Stock Splits. etc. In case the Company,
at any time or from time to time after the Closing Date, shall declare or pay
any dividend on the Common Stock or any other security, payable in Common Stock,
or shall effect a subdivision of the outstanding shares of Common Stock into a
greater number of shares of Common Stock (by reclassification or otherwise than
by payment of a dividend in Common Stock), then, and in each such case, the
Warrant Price in effect immediately prior to the payment of such dividend or
effectiveness of such subdivision shall be proportionately reduced (a) in the
case of any such dividend, immediately after the close of business on the record
date for the determination of holders of any class of securities entitled to
receive such dividend, or (b) in the case of any such subdivision, at the close
of business on the day immediately prior to the day upon which such corporate
action becomes effective.
ss. 2.5 Computation of Consideration. For the purposes of this
Section 2:
(a) the consideration for the issue or sale of any Additional
Shares of Common Stock shall, irrespective of the accounting treatment
of such consideration:
(i) insofar as it consists of cash, be computed at the net
amount of cash received by the Company, before deducting any
expenses paid or incurred by the Company and all commissions and
compensation paid and concessions and discounts allowed to
underwriters, dealers or others performing similar services in
connection with such issue or sale;
(ii) insofar as it consists of property (including
securities) other than cash, be computed at the fair value thereof
at the time of such issue or sale, as determined in good faith by
the Board of Directors of the Company; and
(iii) in case Additional Shares of Common Stock are issued
or sold together with other stock or securities or other assets of
the Company for a consideration which covers both, by the applicable
proportion of such consideration so received, computed as provided
in clauses (i) and (ii) above, as determined in good faith by the
Board of Directors of the Company.
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(b) Additional Shares of Common Stock deemed to have been
issued pursuant to ss. 2.3, relating to Options and Convertible
Securities, shall be deemed to have been issued for a consideration per
share determined by dividing:
(i) the total amount, if any, received and receivable by
the Company as consideration for the issue, sale, grant or
assumption of the Options or Convertible Securities in question,
plus the minimum aggregate amount of additional consideration (as
set forth in the instruments relating thereto, without regard to any
provision contained therein for a subsequent adjustment of such
consideration) payable to the Company upon the exercise of such
Options or the conversion or exchange of such Convertible Securities
or, in the case of Options for Convertible Securities, the exercise
of such Options for Convertible Securities and the conversion or
exchange of such Convertible Securities, in each case computing such
consideration as provided in the foregoing subdivision (a),
by
(ii) the maximum number of shares of Common Stock (as set
forth in the instruments relating thereto, without regard to any
provision contained therein for a subsequent adjustment of such
number) issuable upon the exercise of such Options or the conversion
or exchange of such Convertible Securities;
and
(c) Additional Shares of Common Stock deemed to have been
issued pursuant to ss. 2.4, relating to stock dividends and stock
splits, shall be deemed to have been issued for no consideration.
ss. 2.6 Dilution in Case of Other Securities. In case any Other
Securities shall be issued or sold or shall become subject to issue or sale upon
the conversion or exchange of any stock (or Other Securities) of the Company (or
any issuer of Other Securities or any other Person referred to in Section 3) or
to subscription, purchase or other acquisition pursuant to any Options issued or
granted by the Company (or any other issuer or Person), the computations,
adjustments and readjustments provided for in this Section 2 with respect to the
Warrant Price shall be made as nearly as possible in the manner so provided and
applied to determine the amount of Other Securities from time to time receivable
upon the exercise of the Warrants, so as to protect the holders of the Warrants
against the effect of the dilution of the purchase rights granted by the
Warrants.
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ss. 2.7 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, then, and in each
such case, the Warrant Price in effect immediately prior to such combination or
consolidation shall, concurrently with the effectiveness of such combination or
consolidation, be proportionately increased.
ss. 2.8 Other Adjustments. Adjustments shall also be made at the
times and under the circumstances specified in Sections 3 and 4.
ss. 2.9 Determinations by Board of Directors. All determinations
by the Board of Directors of the Company under the provisions of this Warrant
shall be made in good faith with due regard to the interests of the holder of
this Warrant, and in accordance with good financial practice.
SECTION 3. ADJUSTMENTS FOR CONSOLIDATION, MERGER, SALE
OF ASSETS, REORGANIZATION, ETC.
In case the Company, after the Closing Date, (a) shall consolidate
with or merge into any other Person and shall not be the continuing or surviving
corporation in such consolidation or merger, (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 shall be changed into or exchanged
for stock of other securities of any other Person or cash or any other property,
(c) shall transfer all or substantially all of its properties or assets to any
other Person, or (d) shall effect a capital reorganization or reclassification
of the Common Stock or Other Securities (other than a capital reorganization or
reclassification resulting in the issue of Additional Shares of Common Stock for
which adjustment in the Warrant Price is provided in ss. 2.2), then, and in each
such case, proper provision shall be made so that, upon the basis and the terms
and in the manner provided in this Section 3, the holder of this Warrant, upon
the exercise hereof at any time after the consummation of such consolidation,
merger, transfer, reorganization or reclassification, shall be entitled to
receive (at the aggregate Warrant Price in effect at the time of such
consummation for all Common Stock or Other Securities issuable upon such
exercise immediately prior to such consummation), in lieu of the Common Stock or
Other Securities issuable upon such exercise prior to such consummation, the
stock and other securities, cash and property to which such holder would have
been entitled upon such consummation if such holder had exercised this Warrant
immediately prior thereto, subject to adjustments (subsequent to such corporate
action) as nearly equivalent as possible to the adjustments provided for in
Section 2 and this Section 3; provided, however (and the Company covenants),
that (1) the Company shall not effect any of the transactions described in
clauses (a) through (c) above with any Person other than a corporation, and that
(2) the Company shall not effect any of the transactions described in clauses
(a) through (d) above unless, immediately after the
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date of the consummation of such transaction, the Acquiring Corporation or its
Parent is required to file, and in each of its three fiscal years immediately
preceding the date of the consummation of such transaction has filed, reports
with the Commission pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act. In the event that the Acquiring Corporation fulfills the
requirements contained in the immediately preceding proviso, then, if the holder
of this Warrant shall elect (or shall be deemed to elect) to receive common
stock pursuant to clause (b) above, such holder shall be entitled to receive,
upon the basis stated in such clause (b), the common stock of the Acquiring
Corporation and not of its Parent. Notwithstanding anything contained herein to
the contrary, the Company will not effect any of the transactions described in
clauses (a) through (d) above unless, prior to the consummation thereof, each
Person (other than the Company) which may be required to deliver any stock,
securities, cash or property upon the exercise hereof shall assume, by written
instrument delivered and satisfactory to the holder of this Warrant, the
obligation to deliver to such holder such shares of stock, securities, cash or
property as in accordance with the foregoing provisions, such holder may be
entitled to purchase, and such Person shall have furnished to the holder hereof
an opinion of counsel for such Person, which counsel shall be satisfactory to
such holder, stating that this Warrant shall thereafter continue in full force
and effect and the terms hereof (including, without limitation, all of the
provisions of Section 2 and this Section 3) shall be applicable to the stock,
securities, cash or property which such Person may be required to deliver upon
the exercise hereof.
SECTION 4. OTHER DILUTIVE EVENTS
In case any event shall occur as to which the provisions of
Section 2 or Section 3 are not strictly applicable but the failure to make any
adjustment would not fairly protect the purchase rights represented by this
Warrant in accordance with the essential intent and principles of such Sections,
then, in each such case, the Company shall appoint a firm of independent
certified public accountants of recognized national standing (which may be the
regular independent auditors of the Company), which shall give their opinion
upon the adjustment, if any, on a basis consistent with the essential intent and
principles established in Sections 2 and 3, necessary to preserve, without
dilution, the purchase rights represented by this Warrant. Upon receipt of such
opinion, the Company will promptly mail a copy thereof to the holder of this
Warrant and shall make the adjustments described therein.
SECTION 5. NO DILUTION OR IMPAIRMENT
The Company will not, by amendment of its charter or through any
consolidation, merger, reorganization, transfer of assets, dissolution, issue or
sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of the Warrants, but will at all
times in good faith carry out all such terms and take all such action as may be
necessary or appropriate in order
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to protect the rights of the holders of the Warrants against dilution or other
impairment. Without limiting the generality of the foregoing, the Company (a)
will not permit the par value of any shares of stock receivable upon the
exercise of the Warrants to exceed the amount payable therefor upon such
exercise, (b) will take all such action as may be necessary or appropriate in
order that the Company may validly and legally issue, free from preemptive
rights, fully paid and non-assessable shares of stock upon the exercise of all
Warrants from time to time outstanding, (c) will not take any action which
results in any adjustment of the Warrant Price if the total number of shares of
Common Stock (or Other Securities) issuable after the action upon the exercise
of all of the Warrants would exceed the total number of shares of Common Stock
(or Other Securities) then authorized by the Company's charter and available for
the purpose of issue upon such exercise, and (d) will not issue any capital
stock of any class which is preferred as to dividends or as to the distribution
of assets upon voluntary or involuntary dissolution, liquidation or winding-up,
unless the rights of the holders thereof shall be limited to a fixed sum or
percentage of par value in respect of participation in dividends and in any such
distribution of assets.
SECTION 6. ACCOUNTANTS' REPORT AS TO ADJUSTMENTS
In the case of any adjustment or readjustment in the shares of
Common Stock (or Other Securities) issuable upon the exercise of the Warrants,
the Company at its expense will promptly compute such adjustment or readjustment
in accordance with the terms of the Warrants and cause independent public
accountants of recognized national standing selected by the Company to verify
such computation and prepare a report setting forth such adjustment or
readjustment and showing in detail the facts upon which such adjustment or
readjustment is based, including a statement of (a) the consideration received
or to be received by the Company for any Additional Shares of Common Stock
issued or sold or deemed to have been issued, (b) the number of shares of Common
Stock outstanding or deemed to be outstanding, and (c) the Warrant Price in
effect immediately prior to such issue or sale and as adjusted and readjusted
(if required by Section 2) on account thereof. The Company will forthwith mail a
copy of each such report to each holder of a Warrant, and will, upon the written
request at any time of any holder of a Warrant, furnish to such holder a like
report setting forth the Warrant Price at the time in effect and showing how it
was calculated. The Company will also keep copies of all such reports at its
principal office and at the office or agency maintained by the Company pursuant
to Section 12, and will cause the same to be available for inspection at such
offices during normal business hours by any holder of a Warrant or any
prospective purchaser of a Warrant designated by the holder thereof.
SECTION 7. NOTICES OF CORPORATE ACTION
In the event of a proposal by the Company (or of which the Company
shall have knowledge) for:
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(a) any taking by the Company of a record of the holders of
any class of securities for the purpose of determining the holders
thereof who are entitled to receive any dividend (other than a cash
dividend payable out of earned surplus at the rate most recently
established by the Board of Directors of the Company) or other
distribution, or any right to subscribe for, purchase or otherwise
acquire any shares of stock of any class or any other securities or
property, or to receive any other right, or
(b) any capital reorganization of the Company, any
reclassification or recapitalization of the capital stock of the Company
or any consolidation, merger or exchange of shares involving the Company
and any other Person or any transfer of all or substantially all the
assets of the Company to any other Person, or
(c) any voluntary or involuntary dissolution, liquidation or
winding-up of the Company,
the Company will mail to each holder of a Warrant a notice specifying (i) the
date or expected date on which any such record is to be taken for the purpose of
such dividend, distribution or right, and stating the amount and character of
such dividend, distribution or right, and (ii) the date or expected date on
which any such reorganization, reclassification, recapitalization,
consolidation, merger, exchange of shares, transfer, dissolution, liquidation or
winding-up is to take place and the time, if any such time is to be fixed, as of
which the holders of record of Common Stock (or Other Securities) shall be
entitled to exchange their shares of Common Stock (or Other Securities) for
securities or other property deliverable upon such reorganization,
reclassification, recapitalization, consolidation, merger, exchange of shares,
transfer, dissolution, liquidation or winding-up. Such notice shall be mailed at
least 30 days prior to the date therein specified.
SECTION 8. RESTRICTIONS ON TRANSFER; REGISTRATION
ss. 8.1 Restrictive Legends. Except as otherwise permitted by this
Section 8, the Warrant originally issued pursuant to the Stock Purchase
Agreement, each Warrant issued in exchange or substitution for any Warrant
pursuant to Section 13, and each Warrant issued upon the registration of
transfer of any Warrant, shall be stamped or otherwise imprinted with a legend
in substantially the following form:
"This Warrant and any securities acquired upon the exercise of
this Warrant have not been registered under the Securities Act of
1933 and may not be transferred in the absence of such
registration or an exemption therefrom under such Act, except
under circumstances where neither such registration nor such an
exemption is
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required by law. This Warrant and such securities may be
transferred only upon the fulfillment of the conditions specified
in this Warrant."
Except as otherwise permitted by this Section 8, each certificate representing
shares of Common Stock (or Other Securities) issued upon the exercise of any
Warrant, and each certificate issued upon the registration of transfer of any
shares of such Common Stock (or Other Securities), shall be stamped or otherwise
imprinted with a legend in substantially the following form:
"The securities represented by this certificate have not been
registered under the Securities Act of 1933 and may not be
transferred in the absence of such registration or an exemption
therefrom under such Act, except under circumstances where neither
such registration nor such an exemption is required by law. Such
securities may be transferred only upon the fulfillment of the
conditions specified in certain Common Stock Purchase Warrants
issued pursuant to the Stock Purchase Agreement, dated as of May
5, 1998, between Superior National Insurance Group, Inc. (the
"Company"), Insurance Partners, L.P., Insurance Partners Offshore
(Bermuda), L.P., and Capital Z Partners, Ltd. and in the Stock
Purchase Agreement. A complete and correct copy of the form of
such warrants and the Stock Purchase Agreement are available for
inspection at the principal office of the Company and will be
furnished to the holder of such securities upon written request
and without charge."
ss. 8.2 Notice of Proposed Transfer; Opinions of Counsel. Prior to
any transfer of any Restricted Securities, the holder thereof will give written
notice to the Company of such holder's intention to effect such transfer and to
comply in all other respects with this ss. 8.2. Each such notice (a) shall
describe the manner and circumstances of the proposed transfer in sufficient
detail to enable counsel to render the opinions referred to below, and (b) shall
designate counsel for the holder giving such notice (who may be in-house counsel
for such holder). The holder giving such notice will submit a copy thereof to
the counsel designated in such notice and the Company will promptly submit a
copy thereof to its counsel. The following provisions shall then apply:
(i) If in the opinion of each such counsel the proposed
transfer may be effected without registration of such Restricted
Securities under the Securities Act, the Company will promptly
notify the holder thereof and such holder shall thereupon be
entitled to transfer such Restricted Securities in accordance with
the terms of the notice
14
delivered by such holder to the Company. Each Warrant or
certificate, if any, issued upon or in connection with such
transfer shall bear the applicable restrictive legend set forth in
ss. 8.1, unless in the opinion of each such counsel such legend is
no longer required to ensure compliance with the Securities Act.
If for any reason counsel for the Company (after having been
furnished with the information required to be furnished by clause
(a) of this ss. 8.2) shall fail to deliver an opinion to the
Company, or the Company shall fail to notify such holder thereof
as aforesaid, within 15 days after counsel for such holder shall
have delivered its opinion to such holder (with a copy to the
Company), then for all purposes of this Warrant the opinion of
counsel for such holder shall be sufficient to authorize the
proposed transfer and the opinion of counsel for the Company shall
not be required in connection with such proposed transfer; and
(ii) If in the opinion of either or both of such counsel the
proposed transfer may not be effected without registration of such
Restricted Securities under the Securities Act, the Company will
promptly so notify the holder thereof and such holder shall not be
entitled to transfer such Restricted Securities until receipt of a
further notice from the Company under clause (i) above or until
registration of such Restricted Securities under the Securities
Act has become effective.
Notwithstanding the foregoing provisions of this ss. 8.2 but subject to the
provisions of the Stock Purchase Agreement, [ ] shall be permitted at any time
or from time to time to transfer any Restricted Securities to a limited number
of institutional investors; provided, however, that (w) each such investor
represents in writing that it is acquiring such Restricted Securities for
investment and not with a view to the distribution thereof (subject, however, to
any requirement of law to the effect that the disposition thereof shall at all
times be within the control of such transferee), (x) each such investor agrees
in writing to be bound by all the restrictions on transfer of such Restricted
Securities contained in this ss. 8.2, (y) [ ] delivers to the Company an opinion
of [▇▇▇▇, ▇▇▇▇▇, Rifkind, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇] or in-house counsel for [ ], or
other counsel satisfactory to the Company, stating that such transfer may be
effected without registration under the Securities Act, and (z) [ ] delivers to
the Company, at least 10 days prior to such transfer, the name of the counsel
who will deliver the opinion referred to in clause (y) above. The Company will
pay the reasonable fees and disbursements of counsel (other than in-house
counsel) for any holder of Restricted Securities and of counsel for the Company
in connection with all opinions rendered by them pursuant to this ss. 8.2 and
pursuant to ss. 8.3.
ss. 8.3 Termination of Restrictions. The restrictions imposed by
this Section 8 upon the transferability of Warrants and Common Stock (or Other
Securities) shall cease and terminate as to any particular Warrants or Common
Stock (or Other Securities) (a) when such securities shall have been effectively
registered under the
15
Securities Act and disposed of in accordance with the registration statement
covering such securities, or (b) when, in the opinions of both counsel for the
holder thereof and counsel for the Company, or when, on the basis of a pertinent
Commission rule or regulation promulgated under the Securities Act, or a
pertinent "no-action" position taken by the staff of the Commission, such
restrictions are no longer required in order to ensure compliance with the
Securities Act. Whenever such restrictions shall terminate as to any Warrants or
Common Stock (or Other Securities), the holder thereof shall be entitled to
receive from the Company, without expense (other than transfer taxes, if any),
new securities of like tenor not bearing the applicable legend set forth in ss.
8.1.
SECTION 9. AVAILABILITY OF INFORMATION
If and so long as the Company is a Public Company, the Company
will comply with the reporting requirements of Sections 13 and 15(d) of the
Securities Exchange Act and will comply with all other public information
reporting requirements of the Commission (including the requirements of Rule 144
promulgated by the Commission under the Securities Act) from time to time in
effect and relating to the availability of an exemption from the Securities Act
for the sale of any Restricted Securities or the sale of securities by
affiliates. The Company will also cooperate with each holder to complete and
file any information reporting forms presently or hereafter required by the
Commission as a condition to the availability of an exemption from the
Securities Act for the sale of any Restricted Securities or the sale of
securities by affiliates. The Company will deliver to each holder of a Warrant,
promptly upon their becoming available, copies of all financial statements,
reports, notices and proxy statements sent or made available generally by the
Company to its stockholders, and copies of all regular and periodic reports and
all registration statements and prospectuses filed by the Company with any
securities exchange, or with the Commission.
SECTION 10. RESERVATION OF STOCK, ETC.
The Company will at all times reserve and keep available, solely
for issuance and delivery upon the exercise of the Warrants and free from
preemptive rights, all shares of Common Stock (or Other Securities) from time to
time issuable upon the exercise of the Warrants at the time outstanding. All
such shares (and any such Other Securities consisting of shares of capital
stock) shall be duly authorized and, when issued upon such exercise, shall be
validly issued, fully paid and nonassessable with no liability on the part of
the holders thereof. Any such Other Securities (other than shares of capital
stock) shall be duly authorized and, when issued upon such exercise, shall be
validly issued and legally binding obligations, enforceable in accordance with
their terms, with no liability on the part of the holders thereof. Without
limiting the generality of the foregoing, if any shares of Common Stock (or
Other Securities) required to be reserved for the purposes of exercise of this
Warrant require
16
registration with or approval of any governmental authority under any federal
law (other than the Securities Act) or under any state law before such shares
(or Other Securities) may be issued upon exercise of this Warrant, the Company
will at its expense, as expeditiously as possible, cause such shares (or Other
Securities) to be duly registered or approved, as the case may be. The Company,
in addition, will review its stock ledgers, stock transfer books and other
corporate records periodically (and not less often than once in each calendar
quarter) in order to determine whether, as a result of any action taken by the
Company or any officer of the Company, any holder of a Warrant is or shall have
become, directly or indirectly, the beneficial owner of more than such
percentage of any class of its equity securities (as defined in the Securities
Exchange Act) as shall cause such holder to be required to make any filings or
declarations to the Company, the Commission or any national securities exchange
pursuant to the provisions of the Securities Exchange Act or any comparable
federal statute, and the Company will give prompt written notice to such holder
whenever it shall have determined, upon the basis of the information disclosed
by any such review, that such holder is or has become such a holder because of
such action, which notice shall also specify the information upon which the
Company bases such determination; provided, however, that the Company need give
such notice only once in each fiscal year to any holder whose percentage of
beneficial ownership of any class of the Company's equity securities has not
changed since the date of the giving of the immediately preceding notice.
SECTION 11. LISTING ON SECURITIES EXCHANGES
The Company will list on each national securities exchange (or the
Nasdaq National Market System) on which any Common Stock may at any time be
listed, subject to official notice of issuance upon the exercise of the
Warrants, and will maintain such listing of, all shares of Common Stock from
time to time issuable upon the exercise of the Warrants; and the Company will so
list on each national securities exchange (or the Nasdaq National Market
System), and will maintain such listing of, any Other Securities if at the time
any securities of the same class shall be listed on such national securities
exchange (or the Nasdaq National Market System) by the Company.
SECTION 12. MAINTENANCE OF OFFICE OR AGENCY
The Company will maintain an office or agency in Los Angeles
County, California where books for the registration and registration of transfer
of the Warrants will be kept and where the Warrants may be presented for
exercise, registration of transfer, exchange and replacement pursuant to the
provisions hereof. The principal office of the Company shall be such office or
agency unless the Company, by at least 10 days' prior written notice to each
holder of any Warrants, shall designate the principal office of a law firm or a
bank or trust company in such city or area as such office or
17
agency, in which case the principal office of such other law firm or bank or
trust company shall thereafter be such office or agency.
SECTION 13. OWNERSHIP, REGISTRATION OF TRANSFER, EXCHANGE AND SUBSTITUTION OF
WARRANTS
ss. 13.1 Ownership of Warrants. Until due presentment for
registration of transfer as permitted by Section 8, the Company may treat the
Person in whose name any Warrant is registered on the register kept at the
office or agency of the Company maintained pursuant to Section 12 as the owner
and holder thereof for all purposes, notwithstanding any notice to the contrary.
Subject to the foregoing provisions and to Section 8, a Warrant, if properly
assigned, may be exercised by the assignee without first having a new Warrant
issued.
ss. 13.2 Transfer and Exchange of Warrants. Upon the surrender of
any Warrant, properly endorsed, for registration of transfer or for exchange
(for the purpose of combination of Warrants, split-up of Warrants or any other
purpose) at the office or agency maintained by the Company pursuant to Section
12, the Company at its expense will (subject to compliance with Section 8, if
applicable) promptly execute and deliver to or upon the order of the holder
thereof a new Warrant or Warrants of like tenor, in the name of such holder or
as such holder (upon payment by such holder of any applicable transfer taxes)
may direct, calling in the aggregate on the face or faces thereof for the number
of shares of Common Stock called for on the face or faces of the Warrant or
Warrants so surrendered, and thereupon the old Warrant shall be canceled.
ss. 13.3 Replacement of Warrants. Upon receipt of evidence
reasonably satisfactory to the Company of the loss, theft, destruction or
mutilation of any Warrant and, in the case of any such loss, theft or
destruction of any Warrant held by a Person other than [ ] or any institutional
investor, upon delivery of indemnity reasonably satisfactory to the Company in
form and amount, or, in the case of any such mutilation, surrender of such
Warrant for cancellation at the office or agency maintained by the Company
pursuant to Section 12, the Company at its expense will promptly execute and
deliver, in lieu thereof, a new Warrant of like tenor.
ss. 13.4 Expenses. The Company will pay all expenses, taxes (other
than transfer taxes) and other charges payable in connection with the
preparation, issuance and delivery from time to time of Warrants.
SECTION 14. DEFINITIONS
For all purposes of this Warrant, the following definitions shall
apply (the definitions to be applicable to both the singular and the plural
forms of the terms defined where either such form is used in this Warrant):
18
"Acquiring Corporation" means the continuing or surviving
corporation in a consolidation or merger with the Company (if other than the
Company), the transferee of all or substantially all the properties or assets of
the Company, the corporation consolidating with or merging into the Company in a
consolidation or merger in connection with which the Common Stock (or Other
Securities) is (or are) changed into or exchanged for stock or other Securities
of any other Person or cash or any other property, or, in the case of a capital
reorganization or reclassification, the Company.
"Additional Shares of Common Stock" means all shares (including
treasury shares) of Common Stock issued or sold (or, pursuant to ▇▇.▇▇. 2.3 or
2.4, deemed to be issued) by the Company after the Closing Date, whether
subsequently reacquired or retired) by the Company, other than shares issued,
upon the exercise of the Warrants.
"Business Day" means any day other than a Saturday, Sunday or day
upon which banking institutions are authorized or required by law or executive
order to be closed in Los Angeles, California or in the Borough of Manhattan in
The City of New York, New York.
"Cashless Exercise Right" has the meaning set forth in Section 1.1
of this Warrant.
"Closing Date" means the date of original issuance and delivery of
the Warrants being ________, 1998.
"Commission" means the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.
"Common Stock" means the Common Stock, $0.01 par value, of the
Company as constituted on the Closing Date, any stock into which such Common
Stock shall have been changed or any stock resulting from any reclassification
of such Common Stock, and all other stock of any class or classes (however
designated) of the Company, the holders of which have the right, without
limitation as to amount, either to all or to a share of the balance of current
dividends and liquidating dividends after the payment of dividends and
distributions on any shares entitled to preference.
"Common Stock Deemed to be Outstanding" means all shares of Common
Stock that (a) can be acquired upon the conversion of any then outstanding
shares of Convertible Securities, (b) can be purchased upon the exercise of any
then outstanding rights, Options or warrants including, but not limited to,
these Warrants and all Options issued or available for issuance under the Stock
Option Plan or (c) can be acquired upon the conversion of any Convertible
Securities that can be purchased upon the exercise of any then outstanding
rights, Options or warrants.
19
"Company" has the meaning set forth in the opening paragraph of
this Warrant, and any corporation which shall succeed to or assume the
obligations of the Company hereunder in compliance with Section 3.
"Convertible Securities" means any evidences of indebtedness,
shares of stock (other than Common Stock) or other securities directly or
indirectly convertible into or exchangeable for Common Stock.
"Current Market Price" on any date of determination means the
average of the daily Market Price per share of Common Stock during the period of
the 20 consecutive days on which national securities exchanges were open for
trading, ending on the day immediately preceding such date of determination;
provided, however, that if and so long as there shall be no exchange or
over-the-counter market for the Common Stock, the Current Market Price shall be
deemed to be the greater of the Warrant Price on the date of determination or
such price, if any, at which the most recent issue and sale by the Company of
Common Stock in a good faith arm's-length transaction has been effected.
"Exercise Price" has the meaning set forth in Section 1.1 of this
Warrant.
"Expiration Date" has the meaning set forth in Section 19 of this
Warrant.
"Market Price" per share of Common Stock on any date of
determination means (a) the last sale price, regular way, on such date or, if no
such sale takes place on such date, the average of the closing bid and asked
prices on such date, in each case as officially reported on the principal
national securities exchange on which the Common Stock is then listed or
admitted to trading, or (b) if the Common Stock is not then listed or admitted
to trading on any national securities exchange, the average of the reported
closing bid and asked prices on such date as shown by the Nasdaq National Market
System, or, if such notices are not at the time so shown, as determined in good
faith by any member of the National Association of Securities Dealers, Inc.
selected by the Company and satisfactory to the holder of this Warrant;
provided, however, that if and so long as there shall be no exchange or
over-the-counter market for the Common Stock, the Market Price shall be deemed
to be the greater of the Warrant Price on the date of determination or such
price, if any, at which the most recent issue and sale by the Company of Common
Stock in a good faith arm's-length transaction has been effected.
"Options" means rights, options or warrants to subscribe for,
purchase or otherwise acquire either Common Stock or Convertible Securities.
"Other Securities" means any stock (other than Common Stock) and
other securities of the Company or any other Person which the holders of the
Warrants at any time shall be entitled to receive, or shall have received, upon
the exercise of the
20
Warrants in lieu of or in addition to Common Stock, or which at any time shall
be issuable or shall have been issued in exchange for or in replacement of
Common Stock or Other Securities pursuant to Section 3 or otherwise.
"Parent" means as to any Acquiring Corporation, any corporation
which (a) controls the Acquiring Corporation directly or indirectly through one
or more intermediaries, (b) is (or, if not required to file such reports, would,
if so required, be) required to include the Acquiring Corporation in the
consolidated financial statements contained in such Parent's Annual Report on
Form 10-K under the Securities Exchange Act and (c) is not itself included in
the consolidated financial statements of any other Person (other than its
consolidated subsidiaries).
"Persons" means individuals, corporations, partnerships (including
"joint ventures"), trusts, estates, unincorporated organizations and governments
(including political subdivisions), authorities and agencies.
"Public Company" means the Company, if and so long as the Common
Stock is "held of record" (within the meaning of Rule 12g5-1, as promulgated by
the Commission under the Securities Exchange Act and in effect on ____________,
1998) by 500 or more Persons, and a registration statement with respect thereto
is effective under Section 12 of the Securities Exchange Act.
"Purchase Shares" has the meaning set forth in the second opening
paragraph of this Warrant.
"Restricted Securities" means (a) any Warrants bearing the
applicable legend set forth in ss. 8.1, (b) any shares of Common Stock (or Other
Securities) which have bean issued upon the exercise of Warrants and which are
evidenced by a certificate or certificates bearing the applicable legend set
forth in ss. 8.1, and (c) unless the context otherwise requires, any shares of
Common Stock (or Other Securities) which are at the time issuable upon the
exercise of Warrants and which, when so issued, will be evidenced by a
certificate or certificates bearing the applicable legend set forth in ss. 8.1.
"Securities Act" means the Securities Act of 1933, or any similar
federal statute replacing said statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at the time.
"Securities Exchange Act" means the Securities Exchange Act of
1934, or any similar federal statute replacing said statute, and the rules and
regulations of the Commission thereunder, all as the same shall be in effect at
the time.
"Stock Option Plan" means, collectively, all equity incentive
plans or arrangements for employees, directors or consultants of the Company
which, in each case, are approved by the Board of Directors of the Company.
21
"Stock Purchase Agreement" has the meaning set forth in the second
opening paragraph of this Warrant.
"Transfer" means, with respect to any Restricted Securities, any
sale, assignment, pledge or other disposition thereof, or of any interest
therein, which could constitute a "sale" thereof, as that term is defined in
Section 2(3) of the Securities Act.
"Warrant Price" shall have the meaning specified in ss. 2.1.
"Warrants" has the meaning set forth in the second opening
paragraph of this Warrant.
SECTION 15. REMEDIES
The Company hereby expressly acknowledges and stipulates to the
understanding of the holder of this Warrant that the remedies at law of the
holder of this Warrant in the event of any default or threatened default by the
Company in the performance of or compliance with any of the terms of this
Warrant are not and will not be adequate, and agrees that such terms may be
specifically enforced by a decree for the specific performance of any agreement
contained herein or by an injunction against a violation of any of the terms
hereof or otherwise.
SECTION 16. NO RIGHTS OR LIABILITIES AS STOCKHOLDER
Nothing contained in this Warrant shall be construed as conferring
upon the holder hereof any rights as a stockholder of the Company, and nothing
shall be construed as imposing any liabilities on such holder to purchase any
securities or as a stockholder of the Company, whether such liabilities are
asserted by the Company or by creditors of the Company.
SECTION 17. NOTICES
All notices and other communications provided for herein shall be
mailed by first class mail, postage prepaid, addressed (a) if to any holder of
any Warrant, at the registered address of holder as set forth in the register
kept at the office or agency maintained by the Company pursuant to Section 12,
or (b) if to the Company, at its principal office, being an that date of
original issuance of this Warrant ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, or at such other address of the principal office of the Company of which
the Company shall have given notice to each holder of any Warrants in writing;
provided, however, that the exercise of any Warrant shall be effective if
effected in the manner provided in Section 1.
22
SECTION 18. MISCELLANEOUS
This Warrant and any term hereof may be changed, waived,
discharged or terminated only by an instrument in writing signed by the party
against which enforcement of such change, waiver, discharge, or termination is
sought. THIS WARRANT AND THE STOCK PURCHASE AGREEMENT ARE TO BE GOVERNED BY AND
TO BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE APPLICABLE
TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN THE STATE OF DELAWARE.
The headings in this Warrant are inserted for convenience only and shall not be
deemed to constitute a part hereof.
SECTION 19. EXPIRATION
The right to exercise this Warrant shall expire at 5:00 p.m.
Pacific Time, on __________, 2003 (or, if such date shall not be a Business Day,
on the next day that is a Business Day) (the "Expiration Date").
On the 30th day prior to the Expiration Date, the Company shall
give written notice of the expiration of this Warrant to the holder hereof. In
the event the Company fails to give such written notice, the right to exercise
this Warrant shall be extended to 5:00 p.m. Pacific time on the 30th day
following the date on which such written notice is given (or, if such date shall
not be a Business Day, on the next day that is a Business Day).
SUPERIOR NATIONAL INSURANCE GROUP, INC.
By:____________________________________
Name:
Title:
23
SUBSCRIPTION NOTICE
SUPERIOR NATIONAL INSURANCE GROUP, INC.
The undersigned, the registered holder of the foregoing Warrant,
hereby elects to exercise purchase rights represented by said Warrant for, and
to purchase thereunder, ___________________ shares of the Common Stock covered
by said Warrant and [herewith makes payment in full therefor of $_______________
by certified or official bank check payable to the order of the Company] [hereby
exercises its Cashless Exercise Right] and requests that (a) certificates for
such shares (and any Other Securities issuable upon such exercise) be issued in
the name of and delivered to ___________________________
________________________, whose address is _________________, and (b) if such
shares (or Other Securities) shall not include all of the shares (or Other
Securities) issuable as provided in said Warrant, then a new Warrant of like
tenor and date for the balance of the shares (or Other Securities) issuable
thereunder be delivered to the undersigned.
------------------------------
Signature guaranteed:
Dated: ______________________________
24
ASSIGNMENT
For Value Received, the undersigned registered owner hereby sells,
assigns and transfers unto ________________________, the rights represented by
the foregoing Warrant of Superior National Insurance Group, Inc., and appoints
___________________ attorney to transfer said rights on the books of said
corporation, with full power of substitution in the premises.
------------------------------
Signature guaranteed:
Dated: ______________________________