Exhibit 1.4
REPRESENTATIVE'S WARRANT AGREEMENT
Representative's WARRANT AGREEMENT (the "Representative's Warrant
Agreement" or "Agreement"), dated as of ______________, 1998, between U.S.
REMODELERS, INC. (the "Company"), and FIRST LONDON SECURITIES CORPORATION (the
"Representative").
W I T N E S S E T H:
--------------------
WHEREAS, the Representative has agreed, pursuant to that certain
underwriting agreement dated as of the date hereof by and between the Company
and the Representative (the "Underwriting Agreement"), to act as the
representative of the Underwriters in connection with the Company's proposed
public offering (the "Public Offering") of 1,400,000 Units (the "Securities") at
$5.125 per Unit (the "Unit IPO Price"), each Unit comprised of one share of
common stock, par value $.01 per share (the "Common Stock"), at $5.00 per share
of Common Stock (the "Common Stock IPO Price") and one redeemable common stock
purchase warrant (the "Warrant") at $.125 per warrant (the "Warrant IPO
Price"); and
WHEREAS, the Company proposes to issue to the Representative and/or persons
related to the Representative as those persons are defined in Rule 2710 of the
NASD Conduct Rules (the "Holder"), 140,000 warrants ("Representative's
Warrants") to purchase 140,000 Units, each Unit comprised of one share of Common
Stock (the "Share") and one Warrant (the "Underlying Warrant") exercisable to
purchase one share of Common Stock (the "Underlying Warrant Share"). The
"Shares," the "Underlying Warrants" and the "Underlying Warrant Shares" are
collectively referred to as the "Warrant Securities;" and
WHEREAS, the Representative's Warrants to be issued pursuant to this
Agreement will be issued by the Company to the holders ("Holders") in
consideration for, and as part of the compensation in connection with, the
Representative acting as representative pursuant to the Underwriting Agreement.
NOW, THEREFORE, in consideration of the premises, the payment by the
Representative to the Company of ONE HUNDRED DOLLARS AND NO CENTS ($100.00), the
agreements herein set forth and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1. Grant and Period.
----------------
The Public Offering has been registered under a Registration Statement on
Form S-1 (File No. ________________) (the "Registration Statement") and
declared effective by the Securities and Exchange Commission (the "SEC" or
"Commission") on ______________, 199__ (the "Effective Date"). This Agreement,
relating to the purchase of the Representative's Warrants, is entered into
pursuant to the Underwriting Agreement between the Company and the
Representative, as representative of the Underwriters, in connection with the
Public Offering.
Pursuant to the Representative's Warrants, the Holders are hereby granted
the right to purchase from the Company, at any time during the four year period
commencing __________, 199__ (one year from the date of the final prospectus
(the "Prospectus Date") relating to the Public Offering (the "Purchase Date")
and expiring at 5:00 New York time on ____________, 200__, (four years after the
Purchase Date) (the "Expiration Time"), up to 140,000 Units, an initial exercise
price (subject to adjustment as provided in Article 8) of $6.15 per Unit (120%
of the Unit IPO Price)(the "Unit Exercise Price"), or $6.00 per Share (the
"Share Exercise Price") and $.15 per Underlying Warrant (the "Warrant Exercise
Price"), subject to the terms and conditions of this Agreement. Each Underlying
Warrant is exercisable to purchase one Underlying Warrant Share (subject to
adjustment as provided in Article 8) at the IPO exercise price (the "Underlying
Warrant Share Exercise Price") during the four year period commencing on the
Purchase Date and ending on the Expiration Time.
Except as specifically otherwise provided herein, the Shares, the
Underlying Warrants and the Underlying Warrant Shares constituting the Warrant
Securities shall bear the same terms and conditions as such securities described
under the caption "Description of Securities" in the Registration Statement, and
as designated in the Company's Certificate of Incorporation and any amendments
thereto, and the Underlying Warrants shall be governed by the terms of the
Warrant Agreement executed in connection with the Public Offering (the "Warrant
Agreement"), except as provided herein, and the Holders shall have registration
rights under the Securities Act of 1933, as amended (the "Act"), for the Shares,
the Underlying Warrants, and the Underlying Warrant Shares, as more fully
described in paragraph Article 7 of this Representative's Warrant Agreement. In
the event of any extension of the expiration date or reduction of the exercise
price of the Warrants, the same such changes to the Underlying Warrants shall be
simultaneously effected, except that the Underlying Warrants shall expire no
later than four years from the Purchase Date.
2. Warrant Certificates.
--------------------
The warrant certificates (the "Warrant Certificates") delivered and to be
delivered pursuant to this Agreement shall be in the form set forth in the form
of Warrant Certificate, attached hereto and made a part hereof, with such
appropriate insertions, omissions, substitutions, and other variations as
required or permitted by this Agreement.
3. Exercise of Warrant.
-------------------
3.1 Full Exercise.
-------------
(a) A Holder may effect a cash exercise of any of the Representative's
Warrants or the Underlying Warrants by surrendering the Warrant Certificate,
together with a Subscription in the form of Exhibit 1 attached thereto, duly
---------
executed by such Holder to the Company, at any time prior to the Expiration
Time, at the Company's principal office, accompanied by payment in cash or by
certified or official bank check payable to the order of the Company in the
amount of the aggregate purchase price of such Warrant Securities, subject to
any adjustments provided for in this Agreement. The aggregate purchase price
hereunder for each Holder shall be equal to the exercise price for such Warrant
Securities as set forth in Article 6 multiplied by the number of Underlying
Warrants,
REPRESENTATIVE'S WARRANT AGREEMENT - PAGE 2
Underlying Warrant Shares or Shares, as applicable, that are the subject of each
Holder's Representative's Warrant (as adjusted as hereinafter provided).
(b) In lieu of the payment of the Share Exercise Price or the Underlying
Warrant Share Exercise Price, as the case may be, in the manner required by
Section 3.1(a), the Holder shall have the right to pay such exercise price for
the shares of Common Stock being so purchased by the surrender to the Company of
any exercisable but unexercised portion of such Holder's Representative's
Warrants or Underlying Warrants, as the case may be, having a then Value (as
defined below) equal to such exercise price multiplied by the number of shares
of Common Stock being purchased upon such exercise ("Cashless Exercise Right").
The sum of (i) the number of shares of Common Stock being purchased upon
exercise of the non-surrendered portion of the Representative's Warrants or the
Underlying Warrants, as the case may be, pursuant to this Cashless Exercise
Right and (ii) the number of shares of Common Stock underlying the portion of
the warrants being so surrendered, shall not in any event be greater than the
total number of shares of Common Stock purchasable upon the complete exercise of
the warrants being so surrendered, if the Share Exercise Price or the Underlying
Warrant Share Exercise Price, as the case may be, were paid in cash. The Value
of the portion of the Representative's Warrants or Underlying Warrants, as the
case may be, being surrendered shall equal the remainder derived from
subtracting (1) the Share Exercise Price or the Underlying Share Exercise Price,
as the case may be, multiplied by the number of shares of Common Stock
underlying the portion of the warrants being so surrendered from (2) the Market
Value (as defined below) of a share of Common Stock multiplied by the number of
shares of Common Stock underlying the portion of the warrants being so
surrendered. The Market Value shall be determined on a per share basis as of
the close of the business day preceding the exercise, which determination shall
be made as follows: (x) if the Common Stock is listed for trading on a national
or regional stock exchange or is included on the Nasdaq National Market or
SmallCap Market, the average closing sale price quoted on such exchange or the
Nasdaq National Market or SmallCap Market that is published in The Wall Street
---------------
Journal for the ten trading days immediately preceding the date of exercise, or
-------
if no trade of the Common Stock shall have been reported during such period, the
last sale price so quoted for the next day prior thereto on which a trade in the
Common Stock was so reported; or (y) if the Common Stock is not so listed,
admitted to trading or included, the average of the closing highest reported bid
and lowest reported ask price as quoted on the National Association of
Securities Dealer's OTC Bulletin Board or in the "pink sheets" published by the
National Daily Quotation Bureau for the first day immediately preceding the date
of exercise on which the Common Stock is traded. The Cashless Exercise Right
may be exercised by the Holder by delivering the Warrant Certificate to the
Company together with a Subscription in the form of Exhibit 2 attached thereto,
---------
duly executed by such Holder, in which case no payment of cash will be required.
3.2 Partial Exercise.
----------------
The Warrant Securities referred to in Section 3.1 above also may be
exercised from time to time in part by surrendering the Warrant Certificate in
the manner specified in Section 3.1, except that with respect to a cash
exercise, the purchase price payable with respect to such exercise shall be
equal to the number of Warrant Securities being purchased hereunder multiplied
by the exercise price for
REPRESENTATIVE'S WARRANT AGREEMENT - PAGE 3
such Warrant Security, subject to any adjustments provided for in this
Agreement. Upon any such partial exercise, the Company, at its expense, will
forthwith issue to the Holder hereof a new Warrant Certificate or
Representative's Warrants of like tenor calling in the aggregate for the number
of securities (as constituted as of the date hereof) for which the Warrant
Certificate shall not have been exercised, issued in the name of the Holder
hereof or as such Holder (upon payment by such Holder of any applicable transfer
taxes) may direct.
4. Issuance of Certificates.
------------------------
Upon the exercise of the Representative's Warrants or the Underlying
Warrants, the issuance of certificates for the shares of Common Stock or other
securities, as applicable, shall be made forthwith (and in any event within
three business days thereafter) without charge to the Holder thereof including,
without limitation, any tax which may be payable in respect of the issuance
thereof, and such certificates shall (subject to the provisions of Articles 5
and 7) be issued in the name of, or in such names as may be directed by, the
Holder thereof; provided, however, that the Company shall not be required to pay
any tax which may be payable in respect of any transfer involved in the issuance
and delivery of any such certificates in a name other than that of the Holder
and the Company shall not be required to issue or deliver such certificates
unless or until the person or persons requesting the issuance thereof shall have
paid to the Company the amount of such tax or shall have established to the
satisfaction of the Company that such tax has been paid.
The Warrant Certificates and the certificates representing the shares of
Common Stock or other securities, as applicable, shall be executed on behalf of
the Company by the manual or facsimile signature of the then present Chairman or
Vice Chairman of the Board of Directors or Chairman or Vice Chairman of the
Company under its corporate seal reproduced thereon, attested to by the manual
or facsimile signature of the then present Secretary or Assistant Secretary of
the Company. Warrant Certificates shall be dated the date of execution by the
Company upon initial issuance, division, exchange, substitution or transfer.
5. Restriction On Transfer of Representative's Warrants.
----------------------------------------------------
The Holder of a Warrant Certificate, by acceptance thereof, covenants and
agrees that the Representative's Warrants may not be sold, transferred,
assigned, hypothecated or otherwise disposed of, in whole or in part for a
period of one year from the Prospectus Date, except (a) to officers of the
Representative or to officers and partners of the other Underwriters or Selected
Dealers participating in the Public Offering; (b) by will; or (c) by operation
of law.
6. Exercise Price.
--------------
6.1 Initial and Adjusted Exercise Prices.
------------------------------------
The initial Unit Exercise Price of each Representative's Warrant shall be
$6.15 per Unit (120% of the Unit IPO Price), or $6.00 per Share and $.15 per
Warrant, that make up the Underlying Warrants. The initial Underlying Warrant
Share Exercise Price of each Underlying Warrant shall be
REPRESENTATIVE'S WARRANT AGREEMENT - PAGE 4
the IPO exercise price. The adjusted exercise price of any Warrant Security
shall be the price which shall result from time to time from any and all
adjustments of the initial exercise price in accordance with the provisions of
Article 8. The Representative's Warrants and the Underlying Warrants are
exercisable during the four year period commencing on the Purchase Date.
6.2 Exercise Price.
--------------
The term "exercise price" herein shall mean the initial exercise price or
the adjusted exercise price, depending upon the context.
7. Registration Rights.
-------------------
7.1 Registration Under the Securities Act of 1933.
---------------------------------------------
The Shares, the Underlying Warrants and the Underlying Warrants Shares
(collectively the "Registrable Securities") have been registered under the
Securities Act of 1933, as amended (the "Act"). Upon exercise, in part or in
whole, of the Representative's Warrants, certificates representing the Shares,
the Underlying Warrants or the Underlying Warrants Shares, as the case may be,
shall bear the following legend in the event there is no current registration
statement effective with the Commission at such time as to such securities:
The securities represented by this certificate may not be offered
or sold except pursuant to (i) an effective registration
statement under the Securities Act of 1933, as amended (the
"Act"), (ii) to the extent applicable, Rule 144 under the Act (or
any similar rule under such Act relating to the disposition of
securities), or (iii) an opinion of counsel, if such opinion
shall be reasonably satisfactory to counsel to the issuer, that
an exemption from registration under such Act and applicable
state securities laws is available.
7.2 Piggyback Registration.
----------------------
If, at any time commencing after the Effective Date of the Public Offering
and expiring seven (7) years thereafter, the Company prepares and files a post-
effective amendment to the Registration Statement, or a new registration
statement, under the Act, or files a Notification on Form 1-A or otherwise
registers securities under the Act, or files a similar disclosure document with
the Commission (collectively the "Registration Documents") as to any of its
securities under the Act (other than under a registration statement pursuant to
Form S-8 or Form S-4 or small business issue equivalent), it will give written
notice by registered mail, at least 30 days prior to the filing of each such
Registration Document, to the Representative and to all other Holders of the
Registrable Securities of its intention to do so. If the Representative or other
Holders of the Registrable Securities notify the Company within 20 days after
receipt of any such notice of its or their desire to include any such
Registrable Securities in such proposed Registration Documents, the Company
shall afford the Representative and such Holders of such Registrable Securities
the opportunity to have any
REPRESENTATIVE'S WARRANT AGREEMENT - PAGE 5
Registrable Securities registered under such Registration Documents or any other
available Registration Document.
Notwithstanding the provisions of this Section 7.2, the Company shall have
the right at any time after it shall have given written notice pursuant to this
Section 7.2 (irrespective of whether a written request for inclusion of any such
securities shall have been made) to elect not to file any such proposed
registration statement, or to withdraw the same after the filing but prior to
the effective date thereof.
7.3 Demand Registration.
-------------------
(a) At any time commencing one year after the Prospectus Date of the
Public Offering, and expiring four years thereafter, the Holders of Registrable
Securities representing more than 50% of such securities at that time
outstanding shall have the right (which is in addition to the registration
rights under Section 7.2), exercisable by written notice to the Company, to have
the Company prepare and file with the Commission at the sole expense of the
Company, on one occasion, a registration statement and/or such other documents,
including a prospectus, and/or any other appropriate disclosure document as may
be reasonably necessary in the opinion of both counsel for the Company and
counsel for the Representative and Holders, in order to comply with the
provisions of the Act, so as to permit a public offering and sale of their
respective Registrable Securities for nine consecutive months (or such longer
period of time as permitted by the Act) by such Holders and any other Holders of
any of the Registrable Securities who notify the Company within ten days after
being given notice from the Company of such request (a "Demand Registration"). A
Demand Registration shall not be counted as a Demand Registration hereunder
until such Demand Registration has been declared effective by the SEC and
maintained continuously effective for a period of at least nine months, subject
to reasonable "black-out" periods in which event such nine months shall be
extended by a number of days equal to the duration and the "black-out" periods,
or such shorter period when all Registrable Securities included therein have
been sold in accordance with such Demand Registration, provided that a Demand
Registration shall be counted as a Demand Registration hereunder if the Company
ceases its efforts in respect of such Demand Registration at the request of the
majority Holders making the demand for a reason other than a material and
adverse change in the business, assets, prospects or condition (financial or
otherwise) of the Company and its subsidiaries taken as a whole.
(b) The Company covenants and agrees to give written notice of any
registration request under this Section 7.3 by the majority of the Holders to
all other registered Holders of any of the Registrable Securities within ten
days from the date of the receipt of any such registration request.
(c) In addition to the registration rights under Section 7.2 and
subsection (a) of this Section 7.3, at any time commencing one year after the
Prospectus Date of the Public Offering, and expiring four years thereafter, the
Holders of any Registrable Securities representing more than 50% of such
securities shall have the right, exercisable by written request to the Company,
to have the Company prepare and file, on one occasion, with the Commission a
registration statement or any other appropriate disclosure document so as to
permit a public offering and sale for nine consecutive
REPRESENTATIVE'S WARRANT AGREEMENT - PAGE 6
months (or such longer period of time as permitted by the Act) by any such
Holder of Registrable Securities; provided, however, that the provisions of
Section 7.4(b) shall not apply to any such registration request and registration
and all costs incident thereto shall be at the expense of the Holder or Holders
participating in the offering pro-rata.
(d) Any written request by the Holders made pursuant to this Section 7.3
shall:
(i) Specify the number of Registrable Securities which the Holders
intend to offer and sell and the minimum price at which the Holders intend
to offer and sell such securities;
(ii) State the intention of the Holders to offer such securities for
sale;
(iii) Describe the intended method of distribution of such
securities; and
(iv) Contain an undertaking on the part of the Holders to provide
all such information and materials concerning the Holders and take all such
action as may be reasonably required to permit the Company to comply with
all applicable requirements of the Commission and to obtain acceleration of
the effective date of the registration statement.
(e) In the event the Company receives from the Holders of any Registrable
Securities representing more than 50% of such securities at that time
outstanding, a request that the Company effect a registration on Form S-3 with
respect to the Registrable Securities and if Form S-3 is available for such
offering, the Company shall, as soon as practicable, effect such registration as
would permit or facilitate the sale and distribution of the Registrable
Securities as are specified in the request. All expenses incurred in connection
with a registration requested pursuant to this Subsection (e) shall be borne by
the Company. Registrations effected pursuant to this Subsection (e) shall not
be counted as registrations pursuant to Sections 7.3 (a) and 7.3 (c).
7.4 Covenants of the Company With Respect to Registration.
-----------------------------------------------------
In connection with any registration under Section 7.2 or 7.3, the Company
covenants and agrees as follows:
(a) The Company shall use its best efforts to file a registration
statement within 45 days of receipt of any demand pursuant to Section 7.3, and
shall use its best efforts to have any such registration statement declared
effective at the earliest practicable time. The Company will promptly notify
each seller of such Registrable Securities, and confirm such advice in writing,
(i) when such registration statement becomes effective, (ii) when any post-
effective amendment to such registration statement becomes effective, and (iii)
of any request by the SEC for any amendment or supplement to such registration
statement or any prospectus relating thereto or for additional information.
The Company shall furnish to each seller of such Registrable Securities
such number of copies of such registration statement and of each such amendment
and supplement thereto (in each case including each preliminary prospectus and
summary prospectus) in conformity with the requirements
REPRESENTATIVE'S WARRANT AGREEMENT - PAGE 7
of the Act, and such other documents as such seller may reasonably request in
order to facilitate the disposition of the Registrable Securities by such
seller.
(b) The Company shall pay all costs (excluding transfer taxes, if any, and
fees and reasonable expenses of Holder's counsel (such costs of counsel not to
exceed $10,000)), fees and expenses in connection with all registration
statements filed pursuant to Sections 7.2 and 7.3(a) including, without
limitation, the Company's legal and accounting fees, printing expenses, blue sky
fees and expenses. If the Company shall fail to comply with the provisions of
Section 7.3(a), the Company shall, in addition to any other equitable or other
relief available to the Holder, be liable for any or all special and
consequential damages sustained by the Holder requesting registration of their
Registrable Securities.
(c) The Company shall prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be reasonably necessary to keep such registration statement
effective for at least nine months, and to comply with the provisions of the Act
with respect to the disposition of all securities covered by such registration
statement during such period in accordance with the intended methods of
disposition by the seller or sellers of Registrable Securities set forth in such
registration statement. If at any time the SEC should institute or threaten to
institute any proceedings for the purpose of issuing a stop order suspending the
effectiveness of any such registration statement, the Company will promptly
notify each seller of such Registrable Securities and will use all reasonable
efforts to prevent the issuance of any such stop order or to obtain the
withdrawal thereof as soon as possible. The Company will use its good faith
reasonable efforts and take all reasonably necessary action which may be
required in qualifying or registering the Registrable Securities included in a
registration statement for offering and sale under the securities or blue sky
laws of such states as reasonably are required by the seller of such Registrable
Securities, provided that the Company shall not be obligated to execute or file
any general consent to service of process or to qualify as a foreign corporation
to do business under the laws of any such jurisdiction. The Company shall use
its good faith reasonable efforts to cause such Registrable Securities covered
by such registration statement to be registered with or approved by such other
governmental agencies or authorities of the United States or any state thereof
as may be reasonably necessary to enable the seller or sellers thereof to
consummate the disposition of such Registrable Securities.
(d) The Company shall indemnify the Holder of the Registrable Securities
to be sold pursuant to any registration statement and each person, if any, who
controls such Holders within the meaning of Section 15 of the Act or Section
20(a) of the Securities Exchange Act of 1934, as amended ("Exchange Act"),
against all loss, claim, damage, expense or liability (including all expenses
reasonably incurred in investigating, preparing or defending against any claim
whatsoever) to which any of them may become subject under the Act, the Exchange
Act or otherwise, arising from such registration statement but only to the same
extent and with the same effect as the provisions pursuant to which the Company
has agreed to indemnify the Representative as contained in the Underwriting
Agreement.
REPRESENTATIVE'S WARRANT AGREEMENT - PAGE 8
(e) If requested by the Company prior to the filing of any registration
statement covering the Registrable Securities, each of the Holders of the
Registrable Securities to be sold pursuant to a registration statement, and
their successors and assigns, shall severally, and not jointly, indemnify the
Company, its officers and directors and each person, if any, who controls the
Company within the meaning of Section 15 of the Act or Section 20(a) of the
Exchange Act, against all loss, claim, damage or expense or liability (including
all expenses reasonably incurred in investigating, preparing or defending
against any claim whatsoever) to which they may become subject under the Act,
the Exchange Act or otherwise, arising from written information furnished by
such Holder, or their successors or assigns, for specific inclusion in such
registration statement to the same extent and with the same effect as the
provisions contained in the Underwriting Agreement pursuant to which the
Representative have agreed to indemnify the Company, except that the maximum
amount which may be recovered from each Holder pursuant to this paragraph or
otherwise shall be limited to the amount of net proceeds received by the Holder
from the sale of the Registrable Securities.
(f) Nothing contained in this Agreement shall be construed as requiring
the Holders to exercise their Representative's Warrants or Underlying Warrants
prior to the filing of any registration statement or the effectiveness thereof.
(g) The Company shall not permit the inclusion of any securities other
than the Registrable Securities to be included in any registration statement
filed pursuant to Section 7.3 without the prior written consent of the Holders
of the Registrable Securities representing a majority of such securities.
(h) The Company shall furnish to each Holder participating in the offering
and to each underwriter, if any, a signed counterpart, addressed to such Holder
or underwriter, of (i) an opinion of counsel to the Company, dated the effective
date of such registration statement (and, if such registration includes an
underwritten public offering, an opinion dated the date of the closing under the
Underwriting Agreement), and (ii) a "cold comfort" letter dated the effective
date of such registration statement (and, if such registration includes an
underwritten public offering, a letter dated the date of the closing under the
Underwriting Agreement) signed by the independent public accountants who have
issued a report on the Company's financial statements included in such
registration statement, in each case covering substantially the same matters
with respect to such registration statement (and the prospectus included
therein) and, in the case of such accountants' letter, with respect to events
subsequent to the date of such financial statements, as are customarily covered
in opinions of issuer's counsel and in accountants' letters delivered to
underwriters in underwritten public offerings of securities.
(i) The Company shall deliver promptly to each Holder participating in the
offering requesting the correspondence and memoranda described below and the
managing underwriter copies of all correspondence between the Commission and the
Company, its counsel or auditors and all memoranda relating to discussions with
the Commission or its staff with respect to the registration statement and
permit each Holder and underwriter to do such investigation, upon reasonable
advance notice, with respect to information contained in or omitted from the
registration statement as it deems reasonably necessary to comply with
applicable securities laws or rules of the National Association of Securities
Dealers, Inc. ("NASD"). Such investigation shall include access to books,
records and
REPRESENTATIVE'S WARRANT AGREEMENT - PAGE 9
properties and opportunities to discuss the business of the Company with its
officers and independent auditors, all to such reasonable extent and at such
reasonable times and as often as any such Holder shall reasonably request.
(j) With respect to a registration statement filed pursuant to Section 7.3,
the Company, if requested, shall enter into an Underwriting Agreement with the
managing underwriter, reasonably satisfactory to the Company, selected for such
underwriting by Holders holding a majority of the Registrable Securities
requested to be included in such underwriting. Such agreement shall be
satisfactory in form and substance to the Company, each Holder and such managing
underwriters, and shall contain such representations, warranties and covenants
by the Company and such other terms as are customarily contained in agreements
of that type used by the managing underwriter. The Holders, if required by the
underwriter to be parties to any underwriting agreement relating to an
underwritten sale of their Registrable Securities, may, at their option, require
that any or all the representations, warranties and covenants of the Company to
or for the benefit of such underwriters shall also be made to and for the
benefit of such Holders. Such Holders shall not be required to make any
representations or warranties to or agreements with the Company or the
underwriters except as they may relate to such Holders and their intended
methods of distribution.
(k) Notwithstanding the provisions of Section 7.2 or Section 7.3 of this
Agreement, the Company shall not be required to effect or cause the registration
of Registrable Securities pursuant to Section 7.2 or Section 7.3 if and to the
extent that, within 30 days after its receipt of a request to register such
Registrable Securities (i) counsel for the Company delivers an opinion to the
Holders requesting registration of such Registrable Securities, in form and
substance satisfactory to counsel to such Holder, to the effect that the entire
number of Registrable Securities proposed to be sold by such Holders may
otherwise be sold, in the manner proposed by such Holder, without registration
under the Securities Act, or (ii) the SEC shall have issued a no-action
position, in form and substance reasonably satisfactory to counsel for the
Holder requesting registration of such Registrable Securities, to the effect
that the entire number of Registrable Securities proposed to be sold by such
Holder may be sold by it, in the manner proposed by such Holder, without
registration under the Securities Act.
(l) After completion of the Public Offering, the Company shall not,
directly or indirectly, enter into any merger, business combination or
consolidation in which (i) the Company shall not be the surviving corporation
and (ii) the stockholders of the Company are to receive, in whole or in part,
capital stock or other securities of the surviving corporation, unless the
surviving corporation shall, prior to such merger, business combination or
consolidation, agree in writing to assume the obligations of the Company under
this Agreement, and for that purpose references hereunder to "Registrable
Securities" shall be deemed to include the securities which the Holders would be
entitled to receive in exchange for Registrable Securities under any such
merger, business combination or consolidation, provided that to the extent such
securities to be received are convertible into shares of Common Stock of the
issuer thereof, then any such shares of Common Stock as are issued or issuable
upon conversion of said convertible securities shall also be included within the
definition of "Registrable Securities".
REPRESENTATIVE'S WARRANT AGREEMENT - PAGE 10
8. Adjustments to Exercise Price and Number of Securities.
------------------------------------------------------
8.1 Adjustment for Dividends, Subdivisions, Combinations or
-------------------------------------------------------
Reclassification.
----------------
In case the Company shall (a) pay a dividend or make a distribution in
shares of its capital stock (whether shares of Common Stock or of capital stock
of any other class), (b) subdivide its outstanding shares of Common Stock into a
greater number of shares, (c) combine its outstanding shares of Common Stock
into a smaller number of shares, or (d) issue by reclassification of its shares
of Common Stock any shares of capital stock of the Company; then, and in each
such case, the Share Exercise Price, the Underlying Warrant Exercise Price and
the number of Representative's Warrants in effect immediately prior to such
action shall be adjusted so that the Holder thereafter upon the exercise hereof
shall be entitled to receive the number and kind of shares of the Company which
such Holder would have owned immediately following such action had this warrant
been exercised immediately prior thereto. An adjustment made pursuant to this
Section 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, combination or reclassification.
If, as a result of an adjustment made pursuant to this Section, the Holder shall
become entitled to receive shares of two or more classes of capital stock of the
Company, the Board of Directors of the Company (whose determination shall be
conclusive) shall determine the allocation of the adjusted Share Exercise Price
and Underlying Warrant Exercise Price between or among shares of such class of
capital stock.
Immediately upon any adjustment of the exercise price of any
Representative's Warrant pursuant to this Section, the Company shall send
written notice thereof to the Holder of Warrant Certificates (by first class
mail, postage prepaid), which notice shall state the exercise price of such
Representative's Warrant resulting from such adjustment, and any increase or
decrease in the number of Warrant Securities to be acquired upon exercise of the
Representative's Warrants, setting forth in reasonable detail the method of
calculation and the facts upon which such calculation is based.
8.2 Adjustment For Reorganization, Merger or Consolidation.
------------------------------------------------------
In case of any reorganization of the Company or consolidation of the
Company with, or merger of the Company with, or merger of the Company into,
another corporation (other than a consolidation or merger which does not result
in any reclassification or change of the outstanding Common Stock), the
corporation formed by such consolidation or merger shall execute and deliver to
the Holder a supplemental Warrant agreement providing that the Holder of each
Representative's Warrant then outstanding or to be outstanding shall have the
right thereafter (until the expiration of such Representative's Warrant) to
receive, upon exercise of such Representative's Warrant, the kind and amount of
shares of stock and other securities and property receivable upon such
consolidation or merger, by a holder of the number of shares of Common Stock of
the Company for which such Representative's Warrant might have been exercised
immediately prior to such reorganization, consolidation, merger, conveyance,
sale or transfer. Such supplemental Warrant agreement shall provide for
adjustments which shall be identical to the adjustments provided in Section 8.1
and such registration rights and other rights as provided in this Agreement.
The Company shall not effect any
REPRESENTATIVE'S WARRANT AGREEMENT - PAGE 11
such consolidation, merger, or similar transaction as contemplated by this
Section 8.2, unless prior to or simultaneously with the consummation thereof,
the successor corporation (if other than the Company) resulting from such
consolidation or merger or the corporation purchasing, receiving, or leasing
such assets or other appropriate corporation or entity shall assume, by written
instrument executed and delivered to the Holders, the obligation to deliver to
the Holders, such shares of stock, securities, or assets as, in accordance with
the foregoing provisions, such holders may be entitled to purchase, and to
perform the other obligations of the Company under this Agreement. The above
provision of this Subsection shall similarly apply to successive consolidations
or successively whenever any event listed above shall occur.
8.3 Dividends and Other Distributions.
---------------------------------
In the event that the Company shall at any time prior to the exercise of
all of the Representative's Warrants and Underlying Warrants distribute to its
stockholders any assets, property, rights, evidences of indebtedness, securities
(other than a distribution made as a cash dividend payable out of earnings or
out of any earned surplus legally available for dividends under the laws of the
jurisdictions of incorporation of the Company), whether issued by the Company or
by another, the Holders of the unexercised Representative's Warrants shall
thereafter be entitled, in addition to the shares of Common Stock or other
securities and property receivable upon the exercise thereof, to receive, upon
the exercise of such Representative's Warrants, the same property, assets,
rights, evidences of indebtedness, securities or any other thing of value that
they would have been entitled to receive at the time of such distribution as if
the Representative's Warrants had been exercised immediately prior to such
distribution. At the time of any such distribution, the Company shall make
appropriate reserves to ensure the timely performance of the provisions of this
subsection or an adjustment to the exercise price of such Representative's
Warrants, which shall be effective as of the day following the record date for
such distribution.
8.4 Adjustment in Number of Securities.
----------------------------------
Upon each adjustment of the exercise price of Representative's Warrants
pursuant to the provisions of this Article 8, the number of securities issuable
upon the exercise of each Warrant and Underlying Warrant shall be adjusted to
the nearest full amount by multiplying a number equal to the exercise price in
effect immediately prior to such adjustment by the number of securities issuable
upon exercise of the Representative's Warrants and the Underlying Warrants
immediately prior to such adjustment and dividing the product so obtained by the
adjusted exercise price.
8.5 No Adjustment of Exercise Price in Certain Cases.
------------------------------------------------
No adjustment of the exercise price of any Representative's Warrant shall
be made if the amount of said adjustment would be less than $.05 per security;
provided, however, that in any such case any adjustment that would otherwise be
required then to be made shall be carried forward and shall be made at the time
of and together with the next subsequent adjustment which, together with any
adjustment so carried forward, shall amount to at least $.05 per security.
REPRESENTATIVE'S WARRANT AGREEMENT - PAGE 12
8.6 Accountant's Certificate of Adjustment.
--------------------------------------
In each case of an adjustment or readjustment of the Share Exercise Price,
Underlying Warrant Exercise Price or the number of any securities issuable upon
exercise of the Representative's Warrants or the Underlying Warrants, the
Company, at its expense, shall cause independent certified public accountants of
recognized standing selected by the Company (who may be the independent
certified public accountants then auditing the books of the Company) to compute
such adjustment or readjustment in accordance herewith and prepare a certificate
showing such adjustment or readjustment, and shall mail such certificate, by
first class mail, postage prepaid, to any Holder of the Representative's
Warrants or the Underlying Warrants, as the case may be, at the Holder's address
as shown on the Company's books. The certificate shall set forth such
adjustment or readjustment, showing in detail the facts upon which such
adjustment or readjustment is based including, but not limited to, a statement
of (i) the Share Exercise Price or the Underlying Warrant Share Exercise Price
at the time in effect, and (ii) the number of additional securities and the type
and amount, if any, of other property which at the time would be received upon
exercise of the Representative's Warrants or Underlying Warrants, as the case
may be.
8.7 Adjustment of Underlying Warrant Exercise Price.
-----------------------------------------------
With respect to any of the Underlying Warrants, whether or not the
Underlying Warrants have been exercised (or are exercisable) and whether or not
the Underlying Warrants are issued and outstanding, the Underlying Warrant Share
Exercise Price and the number of Underlying Warrant Shares shall be
automatically adjusted in accordance with the Warrant Agreement between the
Company and the Company's transfer agent, upon occurrence of any of the events
relating to adjustments described therein. Thereafter, the Underlying Warrants
shall be exercisable at such adjusted Underlying Warrant Share Exercise Price
for such adjusted number of Underlying Warrant Shares or other securities,
properties or rights.
9. Exchange and Replacement of Warrant Certificates.
------------------------------------------------
Each Warrant Certificate is exchangeable without expense, upon the
surrender thereof by the registered Holder at the principal executive office of
the Company, for a new Warrant Certificate of like tenor and date representing
in the aggregate the right to purchase the same number of securities in such
denominations as shall be designated by the Holder thereof at the time of such
surrender.
Upon receipt by the Company of evidence reasonably satisfactory to it of
the loss, theft, destruction or mutilation of any Warrant Certificate, and, in
case of loss, theft or destruction, of indemnity or security reasonably
satisfactory to it, and reimbursement to the Company of all reasonable expenses
incidental thereto, and upon surrender and cancellation of the Representative's
Warrants, if mutilated, the Company will make and deliver a new Warrant
Certificate of like tenor, in lieu thereof.
REPRESENTATIVE'S WARRANT AGREEMENT - PAGE 13
10. Elimination of Fractional Interest.
----------------------------------
The Company shall not be required to issue certificates representing
fractions of shares of Common Stock upon the exercise of the Representative's
Warrants or Underlying Warrants, nor shall it be required to issue script or pay
cash in lieu of fractional interests, it being the intent of the parties that
all fractional interests may be eliminated, at the Company's option, by rounding
any fraction up to the nearest whole number of shares of Common Stock or other
securities, properties or rights, or in lieu thereof paying cash equal to such
fractional interest multiplied by the current value of a share of Common Stock.
11. Reservation and Listing.
-----------------------
The Company shall at all times reserve and keep available out of its
authorized shares of Common Stock, solely for the purpose of issuance upon the
exercise of the Representative's Warrants and the Underlying Warrants, such
number of shares of Common Stock or other securities, properties or rights as
shall be issuable upon the exercise thereof. The Company covenants and agrees
that, upon exercise of the Representative's Warrants or the Underlying Warrants,
and payment of the exercise price therefor, all shares of Common Stock and other
securities issuable upon such exercise shall be duly and validly issued, fully
paid, non-assessable and not subject to the preemptive rights of any
stockholder. As long as the Representative's Warrants and Underlying Warrants
shall be outstanding, the Company shall use its best efforts to cause all shares
of Common Stock issuable upon the exercise of the Representative's Warrants and
the Underlying Warrants to be listed and quoted (subject to official notice of
issuance) on all securities exchanges and systems on which the Common Stock
and/or the Warrants may then be listed and/or quoted, including Nasdaq.
12. Notices to Warrant Holders.
--------------------------
Nothing contained in this Agreement shall be construed as conferring upon
the Holders of the Representative's Warrants or the Underlying Warrants the
right to vote or to consent or to receive notice as a stockholder in respect of
any meetings of stockholders, for the election of directors or any other matter,
or as having any rights whatsoever as a stockholder of the Company. If,
however, at any time prior to the expiration of the Representative's Warrants
and the Underlying Warrants and their exercise, any of the following events
shall occur:
(a) The Company shall take a record of the holders of its shares of Common
Stock for the purpose of entitling them to receive a dividend or distribution
payable otherwise than in cash, or a cash dividend or distribution payable
otherwise than out of current or retained earnings, as indicated by the
accounting treatment of such dividend or distribution on the books of the
Company; or
(b) The Company shall offer to all the holders of its Common Stock any
additional shares of capital stock of the Company or securities convertible into
or exchangeable for shares of capital stock of the Company, or any option, right
or warrant to subscribe therefor; or
REPRESENTATIVE'S WARRANT AGREEMENT - PAGE 14
(c) A dissolution, liquidation or winding up of the Company (other than in
connection with a consolidation or merger) or a sale of all or substantially all
of its property, assets and business as an entirety shall be proposed;
then, in any one or more of said events, the Company shall give written notice
of such event at least 15 days prior to the date fixed as a record date of the
date of closing the transfer books for the determination of the stockholders
entitled to such dividend, distribution, convertible or exchangeable securities
or subscription rights, or entitled to vote on such proposed dissolution,
liquidation, winding up or sale. Such notices shall specify such record date or
the date of closing the transfer books, as the case may be. Failure to give
such notice or any defect therein shall not affect the validity of any action
taken in connection with the declaration or payment of any such dividend, or the
issuance of any convertible or exchangeable securities, or subscription rights,
options or warrants, or any proposed dissolution, liquidation, winding up or
sale.
13. Underlying Warrants.
-------------------
The form of the certificate representing the Underlying Warrants (and the
form of election to purchase shares of Common Stock upon the exercise of the
Underlying Warrants and the form of assignment printed on the reverse thereof)
shall be substantially as set forth in the exhibits to the Warrant Agreement.
Subject to the terms of this Agreement, one Underlying Warrant shall evidence
the right to initially purchase one fully paid and nonassessable share of Common
Stock at the Warrant IPO Price during the four year period commencing on the
Purchase Date and ending at the Effective Time, at which time the Underlying
Warrants Share shall expire. The Underlying Warrant Share Exercise Price and
the number of Underlying Warrant Shares issuable upon the exercise of the
Underlying Warrants are subject to adjustment, whether or not the
Representative's Warrants have been exercised and the Underlying Warrants have
been issued, in the manner and upon the occurrence of the events set forth in
the Warrant Agreement, which is hereby incorporated herein by reference and made
a part hereof as if set forth in its entirety herein. Subject to the provisions
of this Agreement and upon issuance of the Underlying Warrants, each registered
holder of such Underlying Warrant shall have the right to purchase from the
Company (and the Company shall issue to such registered holders) up to the
number of fully paid and nonassessable shares of Common Stock (subject to
adjustment as provided in the Warrant Agreement) set forth in such Warrant
Certificate, free and clear of all preemptive rights of stockholders, provided
that such registered Holder complies with the terms governing exercise of the
Underlying Warrant set forth in the Warrant Agreement, and pays the applicable
Underlying Warrant Share Exercise Price, determined in accordance with the terms
of the Warrant Agreement. Upon exercise of the Underlying Warrants, the Company
shall forthwith issue to the registered holder of any such Underlying Warrant in
his name or in such name as may be directed by him, certificates for the number
of shares of Common Stock so purchased. Except as otherwise provided herein and
in this Agreement, the Underlying Warrants shall be governed in all respects by
the terms of the Warrant Agreement. The Underlying Warrants shall be
transferable in the manner provided in the Warrant Agreement, and upon any such
transfer, a new Underlying Warrant certificate shall be issued promptly to the
transferee. The Company covenants to send to each Holder, irrespective of
whether or not the Representative's Warrants have been
REPRESENTATIVE'S WARRANT AGREEMENT - PAGE 15
exercised, any and all notices required by the Warrant Agreement to be sent to
holders of Underlying Warrants.
14. Notices.
-------
All notices, requests, consents and other communications hereunder shall be
in writing and shall be deemed to have been duly given when personally
delivered, or mailed by registered or certified mail, return receipt requested:
(a) If to the registered Holder of any of the Registrable Securities, to
the address of such Holder as shown on the books of the Company; or
(b) If to the Company, to the address set forth below or to such other
address as the Company may designate by notice to the Holders.
U.S. Remodelers, Inc.
0000 Xxxx Xxxxxxxxxxx Xxxx, Xxxxx 000X
Xxxxxx, Xxxxx 00000
Attention: Chief Executive Officer
With a copy to: Xxxxxxx Xxxxxx L.L.P.
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxxx, Xx.
15. Entire Agreement: Modification.
------------------------------
This Agreement (and the Underwriting Agreement and Warrant Agreement to the
extent applicable) contain the entire understanding between the parties hereto
with respect to the subject matter hereof, and the terms and provisions of this
Agreement may not be modified, waived or amended except in a writing executed by
the Company and the Holders of at least a majority of Registrable Securities
(based on underlying numbers of shares of Common Stock). Notice of any
modification, waiver or amendment shall be promptly provided to any Holder not
consenting to such modification, waiver or amendment.
16. Successors.
----------
All the covenants and provisions of this Agreement shall be binding upon
and inure to the benefit of the Company, the Holders and their respective
successors and assigns hereunder.
REPRESENTATIVE'S WARRANT AGREEMENT - PAGE 16
17. Termination.
-----------
This Agreement shall terminate at 5:00 New York time on ______________,
2004. Notwithstanding the foregoing, the indemnification and piggy back
registration rights provisions of Section 7 shall survive such termination.
18. Governing Law; Submission to Jurisdiction.
-----------------------------------------
This Agreement and each Warrant Certificate issued hereunder shall be
deemed to be a contract made under the laws of the State of Texas and for all
purposes shall be construed in accordance with the laws of said State without
giving effect to the rules of said State governing the conflicts of laws. The
Company, the Representative and the Holders hereby agree that any action,
proceeding or claim arising out of, or relating in any way to, this Agreement
shall be brought and enforced in a federal or state court of competent
jurisdiction with venue only in the State District court in Dallas, County,
Texas or the United States District Court for the Northern District of Texas,
and irrevocably submits to such jurisdiction, which jurisdiction shall be
exclusive. The Company, the Representative and the Holders hereby irrevocably
waive any objection to such exclusive jurisdiction or inconvenient forum. Any
such process or summons to be served upon any of the Company, the Representative
and the Holders (at the option of the party bringing such action, proceeding or
claim) may be served by transmitting a copy thereof, by registered or certified
mail, return receipt requested, postage prepaid, addressed to it at the address
set forth in Section 14 hereof. Such mailing shall be deemed personal service
and shall be legal and binding upon the party so served in any action,
proceeding or claim.
19. Severability.
------------
If any provision of this Agreement shall be held to be invalid or
unenforceable, such invalidity or unenforceability shall not affect any other
provision of this Agreement.
20. Captions.
--------
The caption headings of the Sections of this Agreement are for convenience
of reference only and are not intended, nor should they be construed as, a part
of this Agreement and shall be given no substantive effect.
21. Benefits of this Agreement.
--------------------------
Nothing in this Agreement shall be construed to give to any person or
corporation other than the Company and the Representative and any other
registered Holder of the Warrant Certificates or Registrable Securities any
legal or equitable right, remedy or claim under this Agreement; and this
Agreement shall be for the sole and exclusive benefit of the Company and the
Representative and any other Holder of the Warrant Certificates or Registrable
Securities.
REPRESENTATIVE'S WARRANT AGREEMENT - PAGE 17
22. Counterparts.
------------
This Agreement may be executed in any number of counterparts and each of
such counterparts shall for all purposes be deemed to be an original, and such
counterparts shall together constitute but one and the same instrument.
IN WITNESS HEREOF, the parties hereto have caused this Agreement to be duly
executed, as of the day and year first above written.
U.S. REMODELERS, INC.
By:_________________________________
Name: ________________________
Title: _______________________
Attest:
________________________
FIRST LONDON SECURITIES CORPORATION
By:_______________________________________
Xxxxxxx X. Xxxxxxx, President
REPRESENTATIVE'S WARRANT AGREEMENT - PAGE 18
EXHIBIT A
WARRANT CERTIFICATE
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE OTHER SECURITIES ISSUABLE
UPON EXERCISE THEREOF MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO (i) AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, (ii) TO THE
EXTENT APPLICABLE, RULE 144 UNDER SUCH ACT (OR ANY SIMILAR RULE UNDER SUCH ACT
RELATING TO THE DISPOSITION OF SECURITIES), OR (iii) AN OPINION OF COUNSEL, IF
SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL FOR THE ISSUER, THAT AN
EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
THE TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE IS
RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:00 P.M., NEW YORK TIME ON ______________, 2004
NO. W-______
_____________ Representative's Warrants
_____________ Underlying Warrants
This Warrant Certificate certifies that ______________________________, or
registered assigns, is the registered holder (the "Holder") of ___________
Representative's Warrant and__________ Underlying Warrants, __________ of U.S.
Remodelers, Inc. (the "Company"). Each Representative's Warrant permits the
Holder to purchase initially, at any time from ____________, 1999 (the "Purchase
Date") until 5:00 p.m. New York Time on ____________, 2004 (the "Expiration
Time"), one Unit of the Company at the initial exercise price, subject to
adjustment in certain events, of $6.15 per Unit (the "Unit Exercise Price")(120%
of the Unit IPO Price). Each Underlying Warrant permits the Holder thereof to
purchase, at any time from the Purchase Date until the Expiration Time, one
share of the Company's Common Stock at the initial exercise price, subject to
adjustment in certain events, of $6.25 per share.
Any exercise of Representative's Warrants or Underlying Warrants shall be
effected by surrender of this Warrant Certificate and payment of the exercise
price thereof at an office or agency of the Company, but subject to the
conditions set forth herein and in the Representative's Warrant Agreement dated
as of _______________, 1998, between the Company and First London Securities
Corporation (the "Representative's Warrant Agreement"). Payment of the exercise
price shall be made by certified check or official bank check in New York
Clearing House funds payable to the order of the Company in the event there is
no cashless exercise pursuant to Section 3.1(b) of the
Representative's Warrant Agreement. The Representative's Warrants and Underlying
Warrants are collectively referred to as "Warrants".
No Warrant may be exercised after the Expiration Time, at which time all
Warrants evidenced hereby, unless exercised prior thereto, hereby shall
thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants issued pursuant to the Representative's Warrant
Agreement, which Representative's Warrant Agreement is hereby incorporated by
reference in and made a part of this instrument and is hereby referred to for a
description of the rights, limitation or rights, obligations, duties and
immunities thereunder of the Company and the holders (the words "holders" or
"holder" meaning the registered holders or registered holder) of the Warrants.
The Representative's Warrant Agreement provides that upon the occurrence of
certain events, the exercise price, the type and the number of the Company's
securities issuable thereupon may, subject to certain conditions, be adjusted.
In such event, the Company will, at the request of the holder, issue a new
Warrant Certificate evidencing the adjustment in the exercise price and the
number or type of securities, as the case may be, issuable upon the exercise of
the Warrants; provided, however, that the failure of the Company to issue such
new Warrant Certificates shall not in any way change, alter, or otherwise
impair, the rights of the holder as set forth in the Representative's Warrant
Agreement.
Upon due presentment for registration or transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate or
Warrant Certificates of like tenor and evidencing in the aggregate a like number
of Warrants shall be issued to the transferees in exchange for this Warrant
Certificate, subject to the limitations provided herein and in the
Representative's Warrant Agreement, without any charge except for any tax or
other governmental charge imposed in connection with such transfer.
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the holder hereof a new
Warrant Certificate representing such number of unexercised Warrants.
The Company may deem and treat the registered holder(s) hereof as the
absolute owner(s) of this Warrant certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the Holder, and for all other
purposes, and the Company shall not be affected by any notice to the contrary.
All terms used in this Warrant Certificate which are defined in the
Representative's Warrant Agreement shall have the meanings assigned to them in
the Representative's Warrant Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be
duly executed under its corporate seal.
Dated as of _______________, 1998
U.S. REMODELERS, INC.
By:
Name:____________________
Title: ____________________
Attest:
________________________________
EXHIBIT 1
FORM OF SUBSCRIPTION (CASH EXERCISE)
------------------------------------
(To be signed only upon exercise of Warrant)
TO: U.S. Remodelers, Inc.
0000 Xxxx Xxxxxxxxxxx Xxxx, Xxxxx 000X
Xxxxxx, Xxxxx 00000
The undersigned, the Holder of Warrant Certificate number ____ (the
"Warrant"), representing ______________ Representative's Warrants and __________
Underlying Warrants of U.S. Remodelers, Inc. (the "Company"), which Warrant
Certificate is being delivered herewith, hereby irrevocably elects to exercise
the purchase right provided by the Warrant Certificate for, and to purchase
thereunder, _____________ Shares and _________________ Underlying Warrants, and
herewith makes payment of $____________ therefor, and requests that the
certificates for such securities be issued in the name of, and delivered to,
__________________________________________ whose address is
____________________________________, all in accordance with the
Representative's Warrant Agreement and the Warrant Certificate.
Dated:____________________________
___________________________________________
(Signature must conform in all respects to
name of Holder as specified on the face of
the Warrant Certificate)
___________________________________________
___________________________________________
(Address)
EXHIBIT 2
FORM OF SUBSCRIPTION (CASHLESS EXERCISE)
----------------------------------------
TO: PawnMart, Inc.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxx Xxxxx, Xxxxx 00000
The undersigned, the Holder of Warrant Certificate number ____ (the
"Warrant"), representing ___________ Representative's Warrants and
_________________ Underlying Warrants of U.S. Remodelers, Inc. (the "Company"),
which Warrant is being delivered herewith, hereby irrevocably elects the
cashless exercise of the purchase right provided by the Representative's Warrant
Agreement and the Warrant Certificate for, and to purchase thereunder, shares of
the Company Common Stock in accordance with the formula provided at Article 3 of
the Representative's Warrant Agreement. The undersigned requests that the
certificates for such shares be issued in the name of, and delivered to,________
___________________________________________ whose address is,_________________
_____________________________________ all in accordance with the Warrant
Certificate.
Dated:____________________________
__________________________________________
(Signature must conform in all respects to
name of Holder as specified on the face of
the Warrant Certificate)
__________________________________________
__________________________________________
(Address)
(FORM OF ASSIGNMENT)
(To be exercised by the registered holder if such
holder desires to transfer the Warrant Certificate.)
FOR VALUE RECEIVED)_____________________________________________________________
hereby sells, assigns and transfers unto
(Print name and address of transferee)
this Warrant Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint______________________________
Attorney, to transfer the within Warrant Certificate on the books of the within-
named Company, and full power of substitution.
Dated: __________________________ Signature:
____________________________________________
(Signature must conform in all respects to
name of holder as specified on the fact of
the Warrant Certificate)
____________________________________________
(Insert Social Security or Other Identifying
Number of Assignee)
