THIS WARRANT AND THE SECURITIES REPRESENTED HEREBY HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND MAY NOT BE TRANSFERRED IN VIOLATION OF SUCH
ACT, THE RULES AND REGULATIONS THEREUNDER OR THE PROVISIONS
OF THIS WARRANT.
No. of Shares of
Common Stock: 10,000 Warrant No. TH-1
WARRANT
To Purchase Common Stock of
CONSECO, INC.
THIS IS TO CERTIFY THAT The Xxxxxxx Foundation (the "Holder"),
or registered assigns, is entitled, at any time prior to the Expiration Date (as
hereinafter defined), to purchase from CONSECO, INC., an Indiana corporation
(the "Company"), Ten Thousand (10,000) shares of Common Stock (as hereinafter
defined and subject to adjustment as provided herein), in whole or in part,
including fractional parts, at a purchase price equal to the Initial Purchase
Price (as hereinafter defined and subject to adjustment as provided herein), all
on the terms and conditions and pursuant to the provisions hereinafter set
forth.
1. DEFINITIONS
As used in this Warrant, the following terms have the
respective meanings set forth below:
"Additional Shares of Common Stock" shall mean all shares of
Common Stock issued by the Company after the date hereof, other than Warrant
Stock.
"Appraised Value" shall mean, in respect of any share of
Common Stock on any date herein specified, the fair saleable value of such share
of Common Stock as of the last day of the most recent fiscal month to end within
60 days prior to such date specified, based on the value of the Company, as
determined by an investment banking firm selected in accordance with the terms
of Section 11.
"Business Day" shall mean a day other than the following: a
Saturday, a Sunday or a day on which bank institutions in New York,
New York or Indianapolis, Indiana are not required to be open.
"Commission" shall mean the Securities and Exchange Commission
or any other federal agency then administering the Securities Act and other
federal securities laws.
"Common Stock" shall mean the Common Stock, no par value per
share, of the Company, and any capital stock into which such Common Stock may
thereafter be changed, and shall also include (i) capital stock of the Company
of any other class (regardless of how denominated) issued to the holders of
shares of Common Stock upon any reclassification thereof which is also not
preferred as to dividends or assets over any other class of stock of the Company
and which is not subject to redemption and (ii) shares of common stock of any
successor or acquiring corporation (as defined in Section 4.2) received by or
distributed to the holders of Common Stock of the Company in the circumstances
contemplated by Section 4.2.
"Current Market Price" shall mean, in respect of any share of
Common Stock on any date herein specified, the Appraised Value of Common Stock
as at such date, or, if the shares of Common Stock shall then be listed or
admitted to trading on any stock exchange or NASDAQ-NMS, the average of the
daily market prices for 30 consecutive Business Days commencing 45 days before
such date. The daily market price for each such Business Day shall be (i) the
last sale price on such day on the principal stock exchange or NASDAQ-NMS on
which such Common Stock is then listed or admitted to trading, or (ii) if no
sale takes place on such day on any such exchange or NASDAQ-NMS, the average of
the last reported closing bid and asked prices on such day as officially quoted
on any such exchange or NASDAQ-NMS.
"Current Warrant Price" shall mean, in respect of a share of
Common Stock at any date herein specified, the price at which a share of Common
Stock may be purchased pursuant to this Warrant on such date.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, or any similar federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect from time to time.
"Exercise Period" shall mean the period during which this
Warrant is exercisable pursuant to Section 2.1.
"Expiration Date" shall mean September 29, 2005.
2
"GAAP" shall mean generally accepted accounting principles in
the United States of America as from time to time in effect and applied
consistently throughout the relevant periods.
"Holder" shall mean the Person in whose name the Warrant set
forth herein is registered on the books of the Company maintained for such
purpose.
"Initial Purchase Price" shall mean $39.2857.
"Majority Holders" shall mean the holders of Warrants
exercisable for in excess of 50% of the aggregate number of shares of Common
Stock then purchasable upon exercise of all Warrants, whether or not then
exercisable.
"NASD" shall mean the National Association of Securities
Dealers, Inc., or any successor corporation thereto.
"NASDAQ-NMS" shall mean the NASDAQ National Market
System.
"Other Property" shall have the meaning set forth
in Section 4.2.
"Other Warrants" shall mean those certain warrants, dated as
of the date hereof, issued by the Company and all warrants issued upon transfer,
division or combination thereof or in substitution therefor.
"Person" shall mean any individual, corporation, partnership,
limited liability company, joint venture, trust, unincorporated association, or
government or other agency or political subdivision thereof.
"Restricted Common Stock" shall mean shares of Common Stock
which are, or which upon their issuance on the exercise of this Warrant or the
Other Warrants would be, evidenced by a certificate bearing the restrictive
legend set forth in Section 6.1(a).
"Securities Act" shall mean the Securities Act of 1933, as
amended, or any similar federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at the time.
"Transfer" shall mean any disposition of any Warrant or
Warrant Stock or of any interest in either thereof, which would constitute a
sale thereof within the meaning of the Securities Act.
3
"Transfer Notice" shall have the meaning set forth in Section
6.2.
"Warrants" shall mean this Warrant and all warrants issued
upon transfer, division or combination of, or in substitution for, any thereof.
All Warrants shall at all times be identical as to terms and conditions and
date, except as to the number of shares of Common Stock for which they may be
exercised.
"Warrant Price" shall mean an amount equal to (i) the number
of shares of Common Stock being purchased upon exercise of this Warrant pursuant
to Section 2.1, multiplied by (ii) the Current Warrant Price as of the date of
such exercise.
"Warrant Stock" shall mean the shares of Common Stock
purchased by the holders of the Warrants upon the exercise thereof.
2. EXERCISE OF WARRANT
2.1. Manner of Exercise. From and after the date hereof and
until 5:00 P.M., New York time, on the Expiration Date, Holder may exercise this
Warrant, on any Business Day, for all or any part of the number of shares of
Common Stock purchasable hereunder.
In order to exercise this Warrant, in whole or in part, Holder
shall deliver to the Company at its principal office at 00000 Xxxxx Xxxxxxxxxxxx
Xxxxxx, Xxxxxx, Xxxxxxx 00000 or at the office or agency designated by the
Company pursuant to Section 9, (i) a written notice of Holder's election to
exercise this Warrant, which notice shall specify the number of shares of Common
Stock to be purchased, (ii) payment of the Warrant Price and (iii) this Warrant.
Such notice shall be substantially in the form of the subscription form
appearing at the end of this Warrant as Exhibit A, duly executed by Holder or
its agent or attorney. Upon receipt thereof, the Company shall, as promptly as
practicable, and in any event within five (5) Business Days thereafter, execute
or cause to be executed and deliver or cause to be delivered to Holder a
certificate or certificates representing the aggregate number of full shares of
Common Stock issuable upon such exercise, together with cash in lieu of any
fraction of a share, as hereinafter provided. The stock certificate or
certificates so delivered shall be, to the extent possible, in such denomination
or denominations as such Holder shall request in the notice and shall be
registered in the name of Holder or, subject to Section 6, such other name as
shall be designated in the notice. This Warrant shall be deemed to
4
have been exercised and such certificate or certificates shall be deemed to have
been issued, and Holder or any other Person so designated to be named therein
shall be deemed to have become a holder of record of such shares for all
purposes, as of the date the notice, together with the cash or check or checks
and this Warrant, is received by the Company as described above and all taxes
required to be paid by Holder, if any, pursuant to Section 2.2 prior to the
issuance of such shares have been paid.
If this Warrant shall have been exercised in part, the Company
shall, at the time of delivery of the certificate or certificates representing
Warrant Stock, deliver to Holder a new Warrant evidencing the rights of Holder
to purchase the unpurchased shares of Common Stock called for by this Warrant,
which new Warrant shall in all other respects be identical with this Warrant,
or, at the request of Holder, appropriate notation may be made on this Warrant
and the same returned to Holder. Notwithstanding any provision herein to the
contrary, the Company shall not be required to register shares in the name of
any Person who acquired this Warrant (or part hereof) or any Warrant Stock
otherwise than in accordance with this Warrant.
Payment of the Warrant Price shall be made at the option of
the Holder by (i) certified or official bank check, (ii) surrender of shares of
Common Stock having an aggregate Current Market Price on the date of surrender
equal to the Warrant Price, (iii) surrender of Warrants representing the right
to purchase a number of shares of Common Stock that have an aggregate Current
Market Price on the date of surrender equal to the sum of (A) the Warrant Price
plus (B) the Current Warrant Price multiplied by the number of shares of Common
Stock for which the Warrants so surrendered are exercisable or (iv) any
combination of the foregoing. Any Warrants or shares of Common Stock so
surrendered shall be duly endorsed by or accompanied by appropriate instruments
of transfer duly executed by Holder or by Holder's attorney duly authorized in
writing.
2.2. Payment of Taxes. All shares of Common Stock issuable
upon the exercise of this Warrant pursuant to the terms hereof shall be validly
issued, fully paid and nonassessable and without any preemptive rights. The
Company shall pay all expenses in connection with, and all taxes and other
governmental charges that may be imposed with respect to, the issue or delivery
thereof, unless such tax or charge is imposed by law upon Holder, in which case
such taxes or charges shall be paid by Holder. 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 shares of Common Stock
5
issuable upon exercise of this Warrant in any name other than that of Holder,
and in such case the Company shall not be required to issue or deliver any stock
certificate until such tax or other charge has been paid or it has been
established to the satisfaction of the Company that no such tax or other charge
is due.
2.3. Fractional Shares. The Company shall not be required to
issue a fractional share of Common Stock upon exercise of any Warrant. As to any
fraction of a share which the Holder of one or more Warrants, the rights under
which are exercised in the same transaction, would otherwise be entitled to
purchase upon such exercise, the Company shall pay a cash adjustment in respect
of such final fraction in an amount equal to the same fraction of the Current
Market Price per share of Common Stock on the date of exercise.
2.4. Continued Validity. A holder of shares of Common Stock
issued upon the exercise of this Warrant, in whole or in part (other than a
holder who acquires such shares after the same have been publicly sold pursuant
to a Registration Statement under the Securities Act or sold pursuant to Rule
144 thereunder), shall continue to be entitled with respect to such shares to
all rights to which it would have been entitled as Holder under Sections 6, 7
and 12 of this Warrant.
3. TRANSFER, DIVISION AND COMBINATION
3.1. Transfer. Subject to compliance with Section 6, transfer
of this Warrant and all rights hereunder, in whole or in part, shall be
registered on the books of the Company to be maintained for such purpose, upon
surrender of this Warrant at the principal office of the Company referred to in
Section 2.1 or the office or agency designated by the Company pursuant to
Section 9, together with a written assignment of this Warrant substantially in
the form of Exhibit B hereto duly executed by Holder or its agent or attorney
and funds sufficient to pay any transfer taxes payable upon the making of such
transfer. Upon such surrender and such payment, the Company shall, subject to
Section 6, execute and deliver a new Warrant or Warrants in the name of the
assignee or assignees and in the denomination specified in such instrument of
assignment, and shall issue to the assignor a new Warrant evidencing the portion
of this Warrant not so assigned, and this Warrant shall promptly be cancelled. A
Warrant, if properly assigned in compliance with Section 6, may be exercised by
a new Holder for the purchase of shares of Common Stock without having a new
Warrant issued.
6
3.2. Division and Combination. Subject to Section 6, this
Warrant may be divided or combined with other Warrants upon presentation hereof
at the aforesaid office or agency of the Company, together with a written notice
specifying the names and denominations in which new Warrants are to be issued,
signed by Holder or its agent or attorney. Subject to compliance with Section
3.1 and with Section 6, as to any transfer which may be involved in such
division or combination, the Company shall execute and deliver a new Warrant or
Warrants in exchange for the Warrant or Warrants to be divided or combined in
accordance with such notice.
3.3. Expenses. The Company shall prepare, issue and deliver
at its own expense (other than transfer taxes, which shall be borne by the
Holder) the new Warrant or Warrants under this Section 3.
3.4. Maintenance of Books. The Company agrees to maintain,
at its aforesaid office or agency, books for the registration and the
registration of transfer of the Warrants.
4. ADJUSTMENTS
The number of shares of Common Stock for which this Warrant is
exercisable, and the price at which such shares may be purchased upon exercise
of this Warrant, shall be subject to adjustment from time to time as set forth
in this Section 4. The Company shall give each Holder notice of any event
described below which requires an adjustment pursuant to this Section 4 at the
time of such event.
4.1. Stock Dividends, Subdivisions and Combinations. If at
any time the Company shall:
(a) pay a dividend on its Common Stock in, or make a
distribution on its Common Stock that is paid or made in, Additional Shares of
Common Stock;
(b) subdivide its outstanding shares of Common Stock into a
greater number of shares of Common Stock; or
(c) combine its outstanding shares of Common Stock into a
smaller number of shares;
then (i) the number of shares of Common Stock for which this Warrant is
exercisable immediately after the occurrence of any such event shall be adjusted
to equal the number of shares of Common Stock which a record holder of the same
number of shares of Common Stock for which this Warrant is exercisable
immediately prior to the occurrence of such
7
event would own or be entitled to receive after the happening of such event, and
(ii) the Current Warrant Price shall be adjusted to equal (A) the Current
Warrant Price multiplied by the number of shares of Common Stock for which this
Warrant is exercisable immediately prior to the adjustment divided by (B) the
number of shares for which this Warrant is exercisable immediately after such
adjustment. An adjustment made pursuant to this Section 4.1 shall become
effective immediately after the record date in the case of a dividend or
distribution and shall become effective immediately after the effective date in
the case of a subdivision or combination. The adjustment shall be made
successively whenever any such distribution is made and shall become effective
immediately after the record date for the determination of stockholders entitled
to receive the distribution.
In computing adjustments under this Section 4.1, fractional
interests in Common Stock shall be taken into account to the nearest 1/10th of a
share.
4.2. Reorganization, Reclassification, Merger, Consolidation
or Disposition of Assets. In case the Company shall reorganize its capital,
reclassify its capital stock, consolidate or merge with or into another
corporation (where the Company is not the surviving corporation or where there
is a change in or distribution with respect to the Common Stock of the Company),
or sell, transfer or otherwise dispose of all or substantially all its property,
assets or business to another corporation and, pursuant to the terms of such
reorganization, reclassification, merger, consolidation or disposition of
assets, shares of common stock of the successor or acquiring corporation, or any
cash, shares of stock or other securities or property of any nature whatsoever
(including warrants or other subscription or purchase rights) in addition to or
in lieu of common stock of the successor or acquiring corporation ("Other
Property"), are to be received by or distributed to the holders of Common Stock
of the Company, then each Holder shall have the right thereafter to receive,
upon exercise of such Warrant, the number of shares of common stock of the
successor or acquiring corporation or of the Company, if it is the surviving
corporation, and Other Property receivable upon or as a result of such
reorganization, reclassification, merger, consolidation or disposition of assets
by a holder of the number of shares of Common Stock for which this Warrant is
exercisable immediately prior to such event. In case of any such reorganization,
reclassification, merger, consolidation or disposition of assets, the successor
or acquiring corporation (if other than the Company) shall expressly assume the
due and punctual observance and performance of each and every
8
covenant and condition of this Warrant to be performed and observed by the
Company and all the obligations and liabilities hereunder, subject to such
modifications as may be deemed appropriate (as determined by resolution of the
Board of Directors of the Company) in order to provide for adjustments of shares
of Common Stock for which this Warrant is exercisable which shall be as nearly
equivalent as practicable to the adjustments provided for in this Section 4. For
purposes of this Section 4.2, "common stock of the successor or acquiring
corporation" shall include stock of such corporation of any class which is not
preferred as to dividends or assets over any other class of stock of such
corporation and which is not subject to redemption and shall also include any
evidences of indebtedness, shares of stock or other securities which are
convertible into or exchangeable for any such stock, either immediately or upon
the arrival of a specified date or the happening of a specified event and any
warrants or other rights to subscribe for or purchase any such stock. The
foregoing provisions of this Section 4.2 shall similarly apply to successive
reorganizations, reclassifications, mergers, consolidations or disposition of
assets.
4.3. Notice of Adjustments. Whenever the number of shares of
Common Stock for which this Warrant is exercisable, or whenever the price at
which a share of such Common Stock may be purchased upon exercise of the
Warrants, shall be adjusted pursuant to Section 4, the Company shall forthwith
prepare a certificate signed by the principal financial officer of the Company
setting forth the number of shares of Common Stock for which this Warrant is
exercisable and (if adjustment is made pursuant to Section 4.2) describing the
number and kind of any other shares of stock or Other Property for which this
Warrant is exercisable, and any change in the purchase price or prices thereof,
and showing in reasonable detail the facts upon which such adjustment is based.
The Company shall promptly cause a signed copy of such certificate to be
delivered to each Holder in accordance with Section 13.2. The Company shall keep
at its office or agency designated pursuant to Section 10 copies of all such
certificates and cause the same to be available for inspection at said office
during normal business hours by any Holder or any prospective purchaser of a
Warrant designated by a Holder thereof.
9
5. RESERVATION AND AUTHORIZATION OF COMMON STOCK;
REGISTRATION WITH OR APPROVAL OF ANY GOVERNMENTAL
AUTHORITY
The Company shall at all times reserve and keep available for
issue upon the exercise of Warrants such number of its authorized but unissued
shares of Common Stock as will be sufficient to permit the exercise in full of
all outstanding Warrants. All shares of Common Stock which shall be so issuable,
when issued upon exercise of any Warrant and payment therefor in accordance with
the terms of such Warrant, shall be duly and validly issued and fully paid and
nonassessable, and not subject to preemptive rights.
Before taking any action which would result in an adjustment
in the number of shares of Common Stock for which this Warrant is exercisable or
in the Current Warrant Price, the Company shall obtain all such authorizations
or exemptions thereof, or consents thereto, as may be necessary from any public
regulatory body or bodies having jurisdiction thereof.
If any shares of Common Stock required to be reserved for
issuance upon exercise of Warrants require registration or qualification with
any governmental authority or other governmental approval or filing under any
federal or state law (otherwise than as provided in Section 6) before such
shares may be so issued, the Company will in good faith and as expeditiously as
possible and at its expense endeavor to cause such shares to be duly registered.
6. RESTRICTIONS ON TRANSFERABILITY
The Warrants and the Warrant Stock shall not be transferred,
hypothecated or assigned before satisfaction of the conditions specified in this
Section 6, which conditions are intended to ensure compliance with the
provisions of the Securities Act with respect to the Transfer of any Warrant or
any Warrant Stock. Holder, by acceptance of this Warrant, agrees to be bound by
the provisions of this Section 6.
6.1. Restrictive Legend. (a) Except as otherwise provided in
this Section 6, each certificate for Warrant Stock initially issued upon the
exercise of this Warrant, and each certificate for Warrant Stock issued to any
subsequent transferee of any such certificate, shall be stamped or otherwise
imprinted with a legend in substantially the following form:
10
"The shares represented by this certificate have not
been registered under the Securities Act of 1933, as amended,
and are subject to the conditions specified in a certain
Warrant dated __________ __, 19__, originally issued by
CONSECO, INC. No transfer of the shares represented by this
certificate shall be valid or effective until such conditions
have been fulfilled. A copy of the form of said Warrant is on
file with the Secretary of CONSECO, INC. The holder of this
certificate, by acceptance of this certificate, agrees to be
bound by the provisions of such Warrant."
(b) Except as otherwise provided in this Section 6, each
Warrant shall be stamped or otherwise imprinted with a legend in substantially
the following form:
"This Warrant and the securities represented hereby
have not been registered under the Securities Act of 1933, as
amended, and may not be transferred in violation of such Act,
the rules and regulations thereunder or the provisions of this
Warrant."
6.2. Notice of Proposed Transfers. Prior to any Transfer or
attempted Transfer of any Warrants or any shares of Restricted Common Stock, the
holder of such Warrants or Restricted Common Stock shall give ten Business Days'
prior written notice (a "Transfer Notice") to the Company of such holder's
intention to effect such Transfer, describing the manner and circumstances of
the proposed Transfer, and obtain from counsel to such holder who shall be
reasonably satisfactory to the Company, an opinion that the proposed Transfer of
such Warrants or such Restricted Common Stock may be effected without
registration under the Securities Act. After receipt of the Transfer Notice and
opinion, the Company shall, within five Business Days thereof, notify the holder
of such Warrants or such Restricted Common Stock as to whether such opinion is
reasonably satisfactory and, if so, such holder shall thereupon be entitled to
Transfer such Warrants or such Restricted Common Stock, in accordance with the
terms of the Transfer Notice. Each certificate, if any, evidencing such shares
of Restricted Common Stock issued upon such Transfer shall bear the restrictive
legend set forth in Section 6.1(a), and each Warrant issued upon such Transfer
shall bear the restrictive legend set forth in Section 6.1(b), unless in the
opinion of such counsel such
11
legend is not required in order to ensure compliance with the Securities Act.
The holder of the Warrants or the Restricted Common Stock, as the case may be,
giving the Transfer Notice shall not be entitled to Transfer such Warrants or
such Restricted Common Stock until receipt of notice from the Company under this
Section 6.2(a) that such opinion is reasonably satisfactory.
6.3. Termination of Restrictions. Notwithstanding the
foregoing provisions of Section 6, the restrictions imposed by this Section upon
the transferability of the Warrants, the Warrant Stock and the Restricted Common
Stock (or Common Stock issuable upon the exercise of the Warrants) and the
legend requirements of Section 6.1 shall terminate as to any particular Warrant
or share of Warrant Stock or Restricted Common Stock (or Common Stock issuable
upon the exercise of the Warrants) (i) when and so long as such security shall
have been effectively registered under the Securities Act and disposed of
pursuant thereto or (ii) when the Company shall have received an opinion of
counsel reasonably satisfactory to it that such security may be transferred
without registration thereof under the Securities Act. Whenever the restrictions
imposed by Section 6 shall terminate as to this Warrant, as hereinabove
provided, the Holder hereof shall be entitled to receive from the Company, at
the expense of the Company, a new Warrant bearing the following legend in place
of the restrictive legend set forth hereon:
"THE RESTRICTIONS ON
TRANSFERABILITY OF THE WITHIN WARRANT
CONTAINED IN SECTION 6 HEREOF TERMINATED
ON ________, 19__, AND ARE OF NO FURTHER
FORCE AND EFFECT."
All Warrants issued upon registration of transfer, division or combination of,
or in substitution for, any Warrant or Warrants entitled to bear such legend
shall have a similar legend endorsed thereon. Whenever the restrictions imposed
by this Section shall terminate as to any share of Restricted Common Stock, as
hereinabove provided, the holder thereof shall be entitled to receive from the
Company, at the Company's expense, a new certificate representing such Common
Stock not bearing the restrictive legend set forth in Section 6.1(a).
12
7. SUPPLYING INFORMATION
The Company shall cooperate with each Holder of a Warrant and
each holder of Restricted Common Stock in supplying such information as may be
reasonably necessary for such Holder or 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 Warrant or Restricted Common Stock.
8. LOSS OR MUTILATION
Upon receipt by the Company from any Holder of evidence
reasonably satisfactory to it of the ownership of and the loss, theft,
destruction or mutilation of this Warrant and indemnity reasonably satisfactory
to it, and in case of mutilation upon surrender and cancellation hereof, the
Company will execute and deliver in lieu hereof a new Warrant of like tenor to
such Holder; provided, in the case of mutilation, no indemnity shall be required
if this Warrant in identifiable form is surrendered to the Company for
cancellation.
9. OFFICE OF THE COMPANY
As long as any of the Warrants remain outstanding, the Company
shall maintain an office or agency (which may be the principal executive offices
of the Company) where the Warrants may be presented for exercise, registration
of transfer, division or combination as provided in this Warrant.
10. APPRAISAL
The determination of the Appraised Value of Common Stock shall
be made by an investment banking firm of nationally recognized standing selected
by the Company and acceptable to the Majority Holders. If the investment banking
firm selected by the Company is not acceptable to the Majority Holders and the
Company and the Majority Holders cannot agree on a mutually acceptable
investment banking firm, then the Majority Holders and the Company shall each
choose one such investment banking firm and the respective chosen firms shall
agree on another investment banking firm which shall make the determination. The
Company shall retain, at its sole cost, such investment banking firm as may be
necessary for the determination of Appraised Value required by the terms of this
Warrant.
13
11. LIMITATION OF LIABILITY
No provision hereof, in the absence of affirmative action by
Holder to purchase shares of Common Stock, and no enumeration herein of the
rights or privileges of Holder hereof, shall give rise to any liability of such
Holder for the purchase price of any Common Stock or as a stockholder of the
Company, whether such liability is asserted by the Company or by creditors of
the Company.
12. MISCELLANEOUS
12.1. Nonwaiver and Expenses. No course of dealing or any
delay or failure to exercise any right hereunder on the part of Holder shall
operate as a waiver of such right or otherwise prejudice Holder's rights, powers
or remedies. If the Company fails to make, when due, any payments provided for
hereunder, or fails to comply with any other provision of this Warrant, the
Company shall pay to Holder such amounts as shall be sufficient to cover any
costs and expenses including, but not limited to, reasonable attorneys' fees,
including those of appellate proceedings, incurred by Holder in collecting any
amounts due pursuant hereto or in otherwise enforcing any of its rights, powers
or remedies hereunder.
12.2. Notice Generally. Any notice, demand, request, consent,
approval, declaration, delivery or other communication hereunder to be made
pursuant to the provisions of this Warrant shall be sufficiently given or made
if in writing and either delivered in person with receipt acknowledged or sent
by registered or certified mail, return receipt requested, postage prepaid, or
by telecopy and confirmed by telecopy answerback, addressed as follows:
(a) If to any Holder or holder of Warrant Stock, at its last
known address appearing on the books of the Company maintained for such
purpose.
(b) If to the Company at:
Conseco, Inc.
00000 Xxxxx Xxxxxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxx 00000
Attention: Xxxxxxxx X. Xxxxx
Telecopy Number: (000) 000-0000
14
or at such other address as may be substituted by notice given as herein
provided. The giving of any notice required hereunder may be waived in writing
by the party entitled to receive such notice. Every notice, demand, request,
consent, approval, declaration, delivery or other communication hereunder shall
be deemed to have been duly given or served on the date on which personally
delivered, with receipt acknowledged, telecopied and confirmed by telecopy
answerback, or three (3) Business Days after the same shall have been deposited
in the United States mail. Failure or delay in delivering copies of any notice,
demand, request, approval, declaration, delivery or other communication to the
person designated above to receive a copy shall in no way adversely affect the
effectiveness of such notice, demand, request, approval, declaration, delivery
or other communication.
12.3. Remedies. Each holder of Warrant and Warrant Stock, in
addition to being entitled to exercise all rights granted by law, including
recovery of damages, will be entitled to specific performance of its rights
under Section 6 of this Warrant.
12.4. Successors and Assigns. Subject to the provisions of
Sections 3.1 and 6, this Warrant and the rights evidenced hereby shall inure to
the benefit of and be binding upon the successors of the Company and the
successors and assigns of Holder. The provisions of this Warrant are intended to
be for the benefit of all Holders from time to time of this Warrant and shall be
enforceable by any such Holder.
12.5. Amendment. This Warrant and all other Warrants may be
modified or amended or the provisions hereof waived with the written consent of
the Company and the Majority Holders, provided that no such Warrant may be
modified or amended to reduce the number of shares of Common Stock for which
such Warrant is exercisable or to increase the price at which such shares may be
purchased upon exercise of such Warrant (before giving effect to any adjustment
as provided therein) without the prior written consent of the Holder thereof.
12.6. Severability. Wherever possible, each provision of this
Warrant shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Warrant shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Warrant.
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12.7. Headings. The headings used in this Warrant are for
the convenience of reference only and shall not, for any purpose, be deemed a
part of this Warrant.
12.8. Governing Law. This Warrant shall be governed by the
laws of the State of New York, without regard to the provisions thereof relating
to conflict of laws.
12.9. Warrant Stock Registration Rights Agreement.
Contemporaneously with the execution and delivery of this Warrant, the Company,
the Warrant Holder and certain other Persons are executing and delivering a
Warrant Stock Registration Rights Agreement granting certain registration rights
to the Warrant Holder and such other Persons.
12.10 Put Right. The Holder may, at any time and from time to
time, elect to cause the Company to purchase all or any portion of the rights to
purchase shares of Common Stock granted hereunder. In the event the Holder
elects to cause the Company to purchase only a portion of the rights to purchase
shares of Common Stock granted hereunder, such portion shall be equal to the
rights to purchase at least 7,000 shares of Common Stock (subject to adjustment
as provided herein). In addition, the Holder may not make more than ten
elections pursuant to this provision in any calendar year. In the event the
Holder shall make an election hereunder, such election shall be in writing and
the closing date for such purchase shall be the second business day following
the date of delivery of such notice. The price payable by the Company in respect
of any rights purchased by it pursuant to this Section 12.10 shall be equal to
the products of (i) the difference between the Current Market Price determined
as of the closing date of such purchase and the Current Warrant Price,
multiplied by (ii) the number of shares of Common Stock subject to the rights
being sold to the Company pursuant to this Section 12.10.
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IN WITNESS WHEREOF, the Company has caused this Warrant to be
duly executed and its corporate seal to be impressed hereon and attested by its
Secretary or an Assistant Secretary.
Dated: January 20, 1997
CONSECO, INC.
By: /s/XXXXXXX X. XXXXXXX
--------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Chairman of the Board,
President and Chief
Executive Officer
Attest:
By: /s/XXXXXXXX X. XXXXX
---------------------
Name: Xxxxxxxx X. Xxxxx
Title: Secretary
G:\LEGAL\MISC\WARRANT2.CNC
17
EXHIBIT A
SUBSCRIPTION FORM
[To be executed only upon exercise of Warrant]
The undersigned registered owner of this Warrant irrevocably
exercises this Warrant for the purchase of ______ Shares of Common Stock of
CONSECO, INC. and herewith makes payment therefor, all at the price and on the
terms and conditions specified in this Warrant and requests that certificates
for the shares of Common Stock hereby purchased (and any securities or other
property issuable upon such exercise) be issued in the name of and delivered to
_____________ whose address is _________________ and, if such shares of Common
Stock shall not include all of the shares of Common Stock issuable as provided
in this Warrant, that a new Warrant of like tenor and date for the balance of
the shares of Common Stock issuable hereunder be delivered to the undersigned.
_________________________________
(Name of Registered Owner)
_________________________________
(Signature of Registered Owner)
_________________________________
(Street Address)
_________________________________
(City) (State) (Zip Code)
NOTICE: The signature on this subscription must correspond with the
name as written upon the face of the within Warrant in every
particular, without alteration or enlargement or any change
whatsoever.
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EXHIBIT B
ASSIGNMENT FORM
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 this Warrant, with respect to the number of
shares of Common Stock set forth below:
Name and Address of Assignee No. of Shares
---------------------------- -------------
of Common Stock
---------------
and does hereby irrevocably constitute and appoint _______ ________________
attorney-in-fact to register such transfer on the books of CONSECO, INC.
maintained for the purpose, with full power of substitution in the premises.
Dated: Print Name:
----------------------------- ----------------------
Signature:
----------------------
Witness:
----------------------
NOTICE: The signature on this assignment must correspond with the name
as written upon the face of the within Warrant in every
particular, without alteration or enlargement or any change
whatsoever.
G:\LEGAL\MISC\WARRANT2.CNC
19
