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THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND ANY SALE,
TRANSFER, PLEDGE OR OTHER DISPOSITION THEREOF MAY BE MADE ONLY (I) IN A
REGISTRATION UNDER SAID ACT OR (II) IF AN EXEMPTION FROM REGISTRATION UNDER
SAID ACT IS AVAILABLE AND THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL TO
THAT EFFECT REASONABLY SATISFACTORY TO IT.
FINET HOLDINGS CORPORATION
COMMON STOCK PURCHASE WARRANT
This Warrant Expires December 16, 2001
Warrant No. 96-1 Shares:1,000,000
THIS CERTIFIES that, subject to the terms and conditions herein set
forth, XXXX XXXXX XXXXXX XXXXX (the "Holder") is entitled to purchase from
FINET HOLDINGS CORPORATION, a Delaware corporation (the "Company"), at any
time or from time to time during the Exercise Period (as hereinafter
defined) the number of shares of fully paid and non-assessable shares of
Common Stock of the Company (the "Shares") as provided herein upon
surrender hereof at the principal office of the Company, and, at the
election of the holder hereof, upon payment of the purchase price at said
office in cash or by cashier's check or by the wire transfer of funds in a
dollar amount equal to the purchase price of the Shares for which the
consideration is being given.
1. Purchase Price. Subject to adjustment as hereinafter provided, the
purchase price of one share of Common Stock (or such securities as may be
substituted for one share of Common Stock pursuant to the provisions
hereinafter set forth) (the "Warrant Price") shall be One Dollar ($1.00)
2. Adjustment of Warrant Price and Number of Shares. The number and
kind of securities issuable upon the exercise of this Warrant shall be
subject to adjustment from time to time upon the happening of certain
events as follows:
(a) Adjustment for Dividends in Stock. In case at any time or from
time to time on or after the date that the Company completes its voluntary
reorganization/recapitalization plan as set forth in the Private Placement
Memorandum dated October 1, 1996 relating to the Company's offering of
2,000,000 shares of its Common Stock in reliance on Regulation D, the
holders of the Common Stock of the Company (or any shares of stock or other
securities at the time receivable upon the exercise of this Warrant) shall
have received, or, on or after the record date fixed for the determination
of eligible stockholders, shall have become entitled to receive, without
payment therefor, other or additional stock of the Company by way of
dividend (other than as provided for in Paragraph 2(b) below), then and in
each such case, the holder of this Warrant shall, upon the exercise hereof,
be entitled to receive, in addition to the number of shares of Common Stock
receivable thereupon, and without payment of any additional consideration
therefor, the amount of such other or additional stock of the Company which
such holder would hold on the date of such exercise had it been the holder
of record of such Common Stock on the date hereof and had thereafter,
during the period from the date hereof to and including the date of such
exercise, retained such shares and/or all other additional stock receivable
by it as aforesaid during such period, given effect to all adjustments
called for during such period by this Paragraph2.
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(b) Adjustment for Changes in Common Stock. In the event of
changes in the outstanding Common Stock of the Company by reason of split-
ups, recapitalizations, reclassifications, mergers, consolidations,
combinations or exchanges of shares, separations, reorganizations,
liquidations, or the like, occurring after the Company completes its
voluntary reorganization/recapitalization plan as set forth in the Private
Placement Memorandum dated October 1, 1996, the number and class of shares
available under the Warrant in the aggregate and the Warrant Price shall be
correspondingly adjusted by the Board of Directors of the Company. The
adjustment shall be such as will give the holder of the Warrant on exercise
for the same aggregate Warrant Price the total number, class, and kind of
shares as he would have owned had the Warrant been exercised prior to the
event and had he continued to hold such shares until after the event
requiring adjustment.
3. No Fractional Shares. No fractional shares of Common Stock will be
issued in connection with any subscription hereunder. In lieu of any
fractional shares which would otherwise be issuable, the Company shall pay
cash equal to the product of such fraction multiplied by the fair market
value of one share of Common Stock on the date of exercise, as determined
by the fair market value of one share of the Company's Common Stock on the
date of exercise as determined in good faith by the Company's Board of
Directors.
4. No Stockholder Rights. This Warrant shall not entitle its holder
to any of the rights of a stockholder of the Company prior to exercise
thereof.
5. Reservation of Stock. The Company covenants that during the period
this Warrant is exercisable, the Company will reserve from its authorized
and unissued Common Stock a sufficient number of shares to provide for the
issuance of Common Stock upon the exercise of this Warrant. The Company
agrees that its issuance of this Warrant shall constitute full authority to
its officers who are charged with the duty of executing stock certificates
to execute and issue the necessary certificates for shares of Common Stock
upon the exercise of this Warrant.
6. Exercise of Warrant. This Warrant may be exercised by the
registered holder or its registered assigns, in whole or in part and in
minimum units of 10,000 shares, by the surrender of this Warrant at the
principal office of the Company, together with the form of subscription
hereof duly executed, accompanied by payment in full of the amount of the
Warrant Price in the form described in this Warrant. Upon partial exercise
hereof, a new warrant or warrants containing the same date and provisions
as this Warrant shall be issued by the Company to the registered holder for
the number of shares of Common Stock with respect to which this Warrant
shall not have been exercised. 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 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. As promptly as practicable on or after
such date, the Company shall issue and deliver to the person or persons
entitled to receive the same, a certificate or certificates for the number
of full shares of Common Stock issuable upon such exercise, together with
cash in lieu of any fraction of a share as provided above.
7. Certificate of Adjustment. Whenever the Warrant Price is adjusted
as herein provided, the Company shall promptly deliver to the record holder
of this Warrant a certificate of an officer of the Company setting forth
the relevant Warrant Price or number of shares after such adjustment and
setting forth a brief statement of the facts requiring such adjustment.
8. Compliance With Securities Act. The holder of this Warrant, by
acceptance hereof, agrees that this Warrant and the shares of Common Stock
to be issued upon exercise hereof (or shares of any security into which
such Common Stock may be converted) are being acquired for investment and
that the holder will not offer, sell, or otherwise dispose of this Warrant
and any shares of Common Stock to be issued upon exercise hereof (or shares
of any security into which such Common Stock may be converted) except under
circumstances which will not result in a violation of the Securities Act of
1933, as amended (the "Securities Act"). Upon exercise of this Warrant,
the holder hereof shall, if requested by the
98
Company, confirm in writing its investment purpose and acceptance of the
restrictions on transfer of the shares of Common Stock.
9. Subdivision of Warrant. At the request of the holder of this
Warrant in connection with a transfer or exercise of a portion of the
Warrant, upon surrender of such Warrant for such purpose to the Company,
the Company at its expense (except for any transfer tax payable) will issue
and exchange therefor warrants of like tenor and date representing in the
aggregate the right to purchase such number of shares of such Common Stock
as shall be designated by such holder at the time of such surrender;
provided, however, that the Company's obligations to subdivide securities
under this section shall be subject to and conditioned upon the compliance
of any such subdivision with applicable state securities laws and with the
Securities Act.
10. Loss, Theft, Destruction, or Mutilation of Warrant. Upon receipt
by the Company of evidence reasonably satisfactory to it of the loss,
theft, destruction, or mutilation of this Warrant, and in case of loss,
theft, or destruction, of indemnity or security reasonably satisfactory to
it, and upon reimbursement to the Company of all reasonable expenses
incidental thereto, and upon surrender and cancellation of this Warrant, if
mutilated, the Company will make and deliver a new Warrant of like tenor
and dates as of such cancellation, in lieu of this Warrant.
11. Miscellaneous. This Warrant shall be governed by the laws of the
State of California. The headings in this Warrant are for purposes of
convenience and reference only, and shall not be deemed to constitute a
part hereof. Neither this Warrant nor any term hereof may be changed,
waived, discharged, or terminated orally but only by an instrument in
writing signed by the Company and the registered holder hereof. All
notices and other communications from the Company to the holder of this
Warrant shall be by telecopy or expedited courier service to the address
furnished to the Company in writing by the last holder of this Warrant who
shall have furnished an address to the Company in writing.
12. Exercise Period. The Exercise Period shall mean the period
commencing on the date hereof and ending on December 16, 2001.
ISSUED this 16th day of December, 1996.
FINET HOLDINGS CORPORATION
By_________________________
President
ATTEST:
_________________________
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FORM OF ASSIGNMENT
FINET HOLDINGS CORPORATION
FOR VALUE RECEIVED the undersigned registered owner of this warrant
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 Number of Shares
and does hereby irrevocably constitute and appoint
________________________________ Attorney to make such transfer on the
books of FINET HOLDINGS CORPORATION maintained for the purpose, with full
power of substitution in the premises.
Dated:______________________
__________________________________
Name of Warrant Holder
Signature: ______________________
Witness: ______________________
100
SUBSCRIPTION FORM
FINET HOLDINGS CORPORATION
(To be executed only upon exercise of
Warrant)
The undersigned registered owner of this Warrant irrevocably exercises
this Warrant for and purchases ________________ of the number of shares of
Common Stock of FINET HOLDINGS CORPORATION purchasable with this Warrant,
and herewith makes payment therefor, all at the price and on the terms and
conditions specified in this Warrant.
Dated:_____________________
________________________________
(Signature of Registered Owner)
________________________________
(Street Address)
________________________________
(City) (State) (Zip Code)
