THE HOLDER (AS DEFINED BELOW) OF THIS PURCHASE OPTION, BY ITS ACCEPTANCE HEREOF,
AGREES THAT IT WILL NOT SELL, TRANSFER OR ASSIGN THIS PURCHASE OPTION EXCEPT AS
HEREIN PROVIDED, AND THE HOLDER OF THIS PURCHASE OPTION FURTHER AGREES THAT IT
WILL NOT SELL, TRANSFER, ASSIGN, PLEDGE OR HYPOTHECATE THIS PURCHASE OPTION FOR
A PERIOD OF ONE YEAR FOLLOWING THE EFFECTIVE DATE (AS DEFINED BELOW) TO ANYONE
OTHER THAN (I) SANDLER X'XXXXX & PARTNERS, L.P. ("XXXXXXX X'XXXXX") OR AN
UNDERWRITER OR A SELECTED DEALER IN CONNECTION WITH THE OFFERING (AS DEFINED
BELOW), OR (II) A BONA FIDE OFFICER OR PARTNER OF XXXXXXX X'XXXXX OR OF ANY SUCH
UNDERWRITER OR SELECTED DEALER.
THIS PURCHASE OPTION IS NOT EXERCISABLE PRIOR TO THE LATER OF (I) THE
ACQUISITION BY WESTERN UNITED FINANCIAL CORPORATION (THE "COMPANY") OF ONE OR
MORE BANKS, THRIFTS AND THEIR RESPECTIVE HOLDING COMPANIES THROUGH A MERGER,
CAPITAL STOCK EXCHANGE, ASSET ACQUISITION, EXCHANGEABLE SHARE TRANSACTION, STOCK
PURCHASE OR OTHER SIMILAR BUSINESS COMBINATION (A "BUSINESS COMBINATION") AND
(II) _______________, 2008 [ONE YEAR FROM THE EFFECTIVE DATE OF THE REGISTRATION
STATEMENT] (THE "EXERCISE DATE"). VOID AFTER 5:00 P.M. NEW YORK CITY LOCAL TIME,
__________________, 2011 [FOUR YEARS FROM THE EFFECTIVE DATE OF THE REGISTRATION
STATEMENT].
UNIT PURCHASE OPTION
FOR THE PURCHASE OF
312,500 UNITS
OF
WESTERN UNITED FINANCIAL CORPORATION
1. PURCHASE OPTION.
THIS CERTIFIES THAT, in consideration of $100.00 duly paid to the
Company by or on behalf of , as registered owner of this Purchase Option (the
"HOLDER"), the Holder is entitled, at any time or from time to time upon the
later of the consummation by the Company of a Business Combination and
____________, 2008 [ONE YEAR FROM THE EFFECTIVE DATE OF THE REGISTRATION
STATEMENT] (the "COMMENCEMENT DATE"), and at or before 5:00 p.m., New York City
local time, ____________, 2011 (the "EXPIRATION DATE") (four (4) years from the
effective date (the "EFFECTIVE DATE") of the registration statement (the
"REGISTRATION STATEMENT") pursuant to which units (the "UNITS") of the Company,
each Unit consisting of one share of common stock of the Company, par value
$0.01 per share (the "COMMON STOCK"), and one warrant (a "WARRANT") exercisable
for one share of Common Stock, are offered for sale to the public (the
"OFFERING")), but not thereafter, to subscribe for, purchase and receive, in
whole or in part, up to three-hundred twelve thousand five hundred (312,500)
Units. Each Warrant is the same as the warrants included in the Units being
registered for sale to the public by way of the Registration Statement (the
"PUBLIC WARRANTS"), except that the exercise price of the Warrant is $7.50 per
share. The form of Warrant is attached hereto as Exhibit A. If the Expiration
Date is a day on which banking institutions are authorized by law to close, then
this Purchase Option may be exercised on the next succeeding day which is not
such a day, in accordance with the terms herein. During the period ending on the
Expiration Date, the Company agrees not to take any action that would terminate
the
1
Purchase Option. This Purchase Option is initially exercisable at $10.00 per
Unit so purchased; provided, however, that upon the occurrence of any of the
events specified in Section 2 hereof, the rights granted by this Purchase
Option, including the exercise price per Unit and the number of Units (and
shares of Common Stock and Warrants) to be received upon such exercise, shall be
adjusted as therein specified. The term "EXERCISE PRICE" shall mean the initial
exercise price or the adjusted exercise price, depending on the context.
2. ADJUSTMENTS.
2.1 ADJUSTMENTS TO EXERCISE PRICE AND NUMBER OF SECURITIES. The
Exercise Price and the number of Units underlying the Purchase Option shall be
subject to adjustment from time to time as hereinafter set forth:
2.1.1 STOCK DIVIDENDS - SPLIT-UPS. If after the date hereof,
and subject to the provisions of Section 2.3 below, the number of outstanding
shares of Common Stock is increased by a stock dividend payable in shares of
Common Stock or by a split-up of shares of Common Stock or other similar event,
then, on the effective date thereof, the number of shares of Common Stock
underlying each of the Units purchasable hereunder shall be increased in
proportion to such increase in outstanding shares. In such case, the number of
shares of Common Stock, and the exercise price applicable thereto, underlying
the Warrants underlying each of the Units purchasable hereunder shall be
adjusted in accordance with the terms of the Warrants. For example, if the
Company declares a two-for-one stock dividend and at the time of such dividend
this Purchase Option is for the purchase of one Unit at $10.00 per whole Unit
(each Warrant underlying the Units is exercisable for $7.50 per share), upon
effectiveness of the dividend, this Purchase Option will be adjusted to allow
for the purchase of one Unit at $10.00 per Unit, each Unit entitling the holder
to receive two shares of Common Stock and two Warrants (each Warrant exercisable
for $3.75 per share).
2.1.2 EXTRAORDINARY DIVIDEND. If the Company, at any time
while this Purchase Option is outstanding and unexpired, shall pay a dividend or
make a distribution in cash, securities or other assets to the holders of Common
Stock, other than (i) as described in Sections 2.1.1, 2.1.3 or 2.1.4, (ii)
regular quarterly or other periodic dividends, (iii) in connection with the
conversion rights of the holders of Common Stock upon consummation of the
Company's initial Business Combination, or (iv) in connection with the Company's
liquidation and the distribution of its assets upon its failure to consummate a
Business Combination (any such non-excluded event being referred to herein as an
"EXTRAORDINARY DIVIDEND"), then the Exercise Price shall be decreased, effective
immediately after the effective date of such Extraordinary Dividend, by the
amount of cash and/or the fair market value (as determined by the Company's
Board of Directors, in good faith) of any securities or other assets paid on
each share of Common Stock in respect of such Extraordinary Dividend.
2.1.3 AGGREGATION OF SHARES. If after the date hereof, and
subject to the provisions of Section 2.3, the number of outstanding shares of
Common Stock is decreased by a consolidation, combination or reclassification of
shares of Common Stock or other similar event, then, on the effective date
thereof, the number of shares of Common Stock underlying each of the Units
purchasable hereunder shall be decreased in proportion to such decrease in
outstanding shares. In such case, the number of shares of Common Stock, and the
exercise price applicable thereto, underlying the Warrants underlying each of
the Units purchasable hereunder shall be adjusted in accordance with the terms
of the Warrants.
2.1.4 REPLACEMENT OF SECURITIES UPON REORGANIZATION, ETC. In
case of any reclassification or reorganization of the outstanding shares of
Common Stock other than a change covered by Section 2.1.1 or 2.1.2 hereof or
that solely affects the par value of such shares of
2
Common Stock, or in the case of any merger or consolidation of the Company with
or into another corporation (other than a consolidation or merger in which the
Company is the continuing corporation and that does not result in any
reclassification or reorganization of the outstanding shares of Common Stock),
or in the case of any sale or conveyance to another corporation or entity of the
property of the Company as an entirety or substantially as an entirety in
connection with which the Company is dissolved, the Holder of this Purchase
Option shall have the right thereafter (until the expiration of the right of
exercise of this Purchase Option) to receive upon the exercise hereof, for the
same aggregate Exercise Price payable hereunder immediately prior to such event,
the kind and amount of shares of stock or other securities or property
(including cash) receivable upon such reclassification, reorganization, merger
or consolidation, or upon a dissolution following any such sale or transfer, by
a holder of the number of shares of Common Stock of the Company obtainable upon
exercise of this Purchase Option and the underlying Warrants immediately prior
to such event; and if any reclassification also results in a change in shares of
Common Stock covered by Section 2.1.1 or 2.1.2, then such adjustment shall be
made pursuant to Sections 2.1.1, 2.1.2 and this Section 2.1.4. The provisions of
this Section 2.1.4 shall similarly apply to successive reclassifications,
reorganizations, mergers or consolidations, sales or other transfers.
2.1.5 CHANGES IN FORM OF PURCHASE OPTION. This form of
Purchase Option need not be changed because of any change pursuant to this
Section, and Purchase Options issued after such change may state the same
Exercise Price and the same number of Units as are stated in the Purchase
Options initially issued pursuant to this form of Purchase Option. The
acceptance by any Holder of the issuance of new Purchase Options reflecting a
required or permissive change shall not be deemed to waive any rights to an
adjustment occurring after the Commencement Date or the computation thereof.
2.1.6 ADJUSTMENTS OF WARRANTS. To the extent the price of the
Warrants is lowered pursuant to Section 3.1 of that certain Warrant Agreement,
dated as of ________________, 2006, between the Company and Xxxxx Fargo Bank,
N.A. (the "WARRANT AGREEMENT"), the price of the Warrants underlying the
Purchase Option shall be reduced on identical terms, subject to any limitations
and conditions that may be imposed by NASD Corporate Financing Rule 2710 and any
such reduction must remain in effect for at least twenty (20) business days. To
the extent the duration of the Warrants is extended pursuant to Section 3.2 of
the Warrant Agreement, the duration of the Warrants underlying the Purchase
Option shall be extended on identical terms, subject to any limitations that may
be imposed by NASD Corporate Financing Rule 2710.
2.2 SUBSTITUTE PURCHASE OPTION. In case of any 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 Purchase Option providing that the Holder shall have
the right thereafter (until the stated expiration of such Purchase Option) to
receive, upon exercise of such Purchase Option, 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 Purchase Option might have been exercised immediately prior to such
consolidation, merger, sale or transfer. Such supplemental Purchase Option shall
provide for adjustments which shall be identical to the adjustments provided in
Section 2. The above provision of this Section shall similarly apply to
successive consolidations or mergers.
2.3 ELIMINATION OF FRACTIONAL INTERESTS. The Company shall not be
required to issue certificates representing fractions of shares of Common Stock
or Warrants upon the exercise of the Purchase Option, nor shall it be required
to issue scrip or pay cash in lieu of any fractional
3
interests, it being the intent of the parties that all fractional interests
shall be eliminated by rounding any fraction up to the nearest whole number of
Warrants, shares of Common Stock or other securities, properties or rights.
3. EXERCISE.
3.1 EXERCISE FORM. In order to exercise this Purchase Option, the
exercise form attached hereto must be duly executed, completed and delivered to
the Company, together with this Purchase Option and payment of the Exercise
Price for the Units being purchased payable in cash or by certified check or
official bank check. If the subscription rights represented hereby shall not be
exercised at or before the Expiration Date, this Purchase Option shall become
and be void without further force or effect, and all rights represented hereby
shall cease and expire.
3.2 CASHLESS EXERCISE.
3.2.1 DETERMINATION OF AMOUNT. In lieu of the payment of the
Exercise Price multiplied by the number of Units for which this Purchase Option
is exercisable (and in lieu of being entitled to receive Common Stock and
Warrants) in the manner required by Section 3.1, the Holder shall have the right
(but not the obligation) to convert any exercisable but unexercised portion of
this Purchase Option into Units ("CONVERSION RIGHT") as follows: upon exercise
of the Conversion Right, the Company shall deliver to the Holder (without
payment by the Holder of any of the Exercise Price in cash) that number of Units
(or that number of shares of Common Stock and Warrants comprising that number of
Units) equal to the quotient obtained by dividing (x) the Value (as defined
below) of the portion of the Purchase Option being converted by (y) the Current
Market Value (as defined below). The "VALUE" of the portion of the Purchase
Option being converted shall equal the remainder derived from subtracting (a)
(i) the Exercise Price multiplied by (ii) the number of Units underlying the
portion of this Purchase Option being converted from (b) the Current Market
Value of a Unit multiplied by the number of Units underlying the portion of the
Purchase Option being converted. As used herein, the term "CURRENT MARKET VALUE"
per Unit at any date means: (A) in the event that neither the Units nor Public
Warrants are still trading, the remainder derived from subtracting (x) the
exercise price of the Warrants multiplied by the number of shares of Common
Stock issuable upon exercise of the Warrants underlying one Unit from (y) (i)
the Current Market Price of the Common Stock multiplied by (ii) the number of
shares of Common Stock underlying one Unit, which shall include the shares of
Common Stock underlying the Warrants included in such Unit; (B) in the event
that the Units, Common Stock and Public Warrants are still trading, (i) if the
Units are listed on a national securities exchange or quoted on the Nasdaq
National Market, Nasdaq SmallCap Market or NASD OTC Bulletin Board (or successor
exchange), the last sale price of the Units in the principal trading market for
the Units as reported by the exchange, Nasdaq or the NASD, as the case may be,
on the last trading day preceding the date in question; or (ii) if the Units are
not listed on a national securities exchange or quoted on the Nasdaq National
Market, Nasdaq SmallCap Market or the NASD OTC Bulletin Board (or successor
exchange), but is traded in the residual over-the-counter market, the closing
bid price for Units on the last trading day preceding the date in question for
which such quotations are reported by the Pink Sheets, LLC or similar publisher
of such quotations; and (C) in the event that the Units are not still trading
but the Common Stock and Public Warrants underlying the Units are still trading,
the Current Market Price of the Common Stock plus the product of (x) the Current
Market Price of the Public Warrants and (y) the number of shares of Common Stock
underlying the Warrants included in one Unit. The "CURRENT MARKET PRICE" shall
mean (i) if the Common Stock (or Public Warrants, as the case may be) is listed
on a national securities exchange or quoted on the Nasdaq National Market,
Nasdaq SmallCap Market or NASD OTC Bulletin Board (or successor exchange), the
last sale price of the Common Stock (or Public Warrants) in the principal
trading market for the Common Stock as reported by the exchange, Nasdaq or the
NASD, as the case may be, on the last trading day preceding the date in
question; (ii) if the Common Stock (or
4
Public Warrants, as the case may be) is not listed on a national securities
exchange or quoted on the Nasdaq National Market, Nasdaq SmallCap Market or the
NASD OTC Bulletin Board (or successor exchange), but is traded in the residual
over-the-counter market, the closing bid price for the Common Stock (or Public
Warrants) on the last trading day preceding the date in question for which such
quotations are reported by the Pink Sheets, LLC or similar publisher of such
quotations; and (iii) if the fair market value of the Common Stock cannot be
determined pursuant to clause (i) or (ii) above, such price as the Board of
Directors of the Company shall determine, in good faith. In the event the Public
Warrants have expired and are no longer exercisable, no "Value" shall be
attributed to the Warrants underlying this Purchase Option. Additionally, in the
event that this Purchase Option is exercised pursuant to this Section 3.2 and
the Public Warrants are still trading, the "Value" shall be reduced by the
difference between the Warrant Exercise Price and the exercise price of the
Public Warrants multiplied by the number of Warrants underlying the Units
included in the portion of this Purchase Option being converted.
3.2.2 MECHANICS OF CASHLESS EXERCISE. The cashless exercise
right described in this Section 3.2 (the "CASHLESS EXERCISE RIGHT") may be
exercised by the Holder on any business day on or after the Commencement Date
and not later than the Expiration Date by delivering the Purchase Option with
the duly executed exercise form attached hereto with the cashless exercise
section completed to the Company, exercising the Cashless Exercise Right and
specifying the total number of Units the Holder will purchase pursuant to such
Cashless Exercise Right.
4. TRANSFER.
4.1 GENERAL RESTRICTIONS. The Holder of this Purchase Option, by its
acceptance hereof, agrees that it will not sell, transfer, assign, pledge or
hypothecate, or enter into any hedging, short sale, derivative, put or call
transaction that would result in the effective economic disposition of, this
Purchase Option for a period of one year following the Effective Date to anyone
other than (i) Sandler X'Xxxxx or an underwriter or a selected dealer in
connection with the Offering, or (ii) a bona fide officer or partner of Xxxxxxx
X'Xxxxx or of any such underwriter or selected dealer. On and after the first
anniversary of the Effective Date, transfers to others may be made subject to
compliance with or exemptions from applicable securities laws. In order to make
any permitted assignment, the Holder must deliver to the Company the assignment
form attached hereto duly executed and completed, together with the Purchase
Option and payment of all transfer taxes, if any, payable in connection
therewith. The Company shall within five (5) business days transfer this
Purchase Option on the books of the Company and shall execute and deliver a new
Purchase Option of like tenor to the appropriate assignee(s) expressly
evidencing the right to purchase the aggregate number of Units purchasable
hereunder or such portion of such number as shall be contemplated by any such
assignment.
4.2 RESTRICTIONS IMPOSED BY THE ACT. The securities evidenced by
this Purchase Option shall not be transferred unless and until (i) the Company
has received an opinion of counsel for the Holder that the securities may be
transferred pursuant to an exemption from registration under the Securities Act
of 1933, as amended (the "ACT") and applicable state securities laws, the
availability of which is established to the reasonable satisfaction of the
Company (the Company hereby agreeing that the opinion of Xxxxxxx & Xxxxxxxxx
shall be deemed satisfactory evidence of the availability of an exemption), or
(ii) a registration statement or a post-effective amendment to the Registration
Statement relating to such securities has been filed by the Company and declared
effective by the Securities and Exchange Commission (the "COMMISSION") and
compliance with applicable state securities law has been established.
5
5. NEW PURCHASE OPTIONS TO BE ISSUED.
5.1 PARTIAL EXERCISE OR TRANSFER. Subject to the restrictions in
Section 4 hereof, this Purchase Option may be exercised or assigned in whole or
in part. In the event of the exercise or assignment hereof in part only, upon
surrender of this Purchase Option for cancellation, together with the duly
executed exercise or assignment form and funds sufficient to pay any Exercise
Price and/or transfer tax, the Company shall cause to be delivered to the Holder
without charge a new Purchase Option of like tenor to this Purchase Option in
the name of the Holder evidencing the right of the Holder to purchase the number
of Units purchasable hereunder as to which this Purchase Option has not been
exercised or assigned.
5.2 LOST CERTIFICATE. Upon receipt by the Company of evidence
satisfactory to it of the loss, theft, destruction or mutilation of this
Purchase Option and of reasonably satisfactory indemnification or the posting of
a bond, the Company shall execute and deliver a new Purchase Option of like
tenor and date. Any such new Purchase Option executed and delivered as a result
of such loss, theft, mutilation or destruction shall constitute a substitute
contractual obligation on the part of the Company.
6. REGISTRATION RIGHTS.
6.1 DEMAND REGISTRATION.
6.1.1 GRANT OF RIGHT. Upon written demand (the "DEMAND
NOTICE") of the Holder(s) of at least 51% in interest of the Purchase Options
and/or the underlying Units and/or the underlying securities (the "MAJORITY
HOLDERS"), the Company agrees to register (the "DEMAND REGISTRATION") under the
Act on one occasion, all of the Purchase Options requested by the Majority
Holders in the Demand Notice and all of the securities underlying such Purchase
Options, including the Units, the Common Stock, the Warrants and the Common
Stock underlying the Warrants (collectively, the "REGISTRABLE SECURITIES").
Within sixty (60) days after receipt of the Demand Notice, the Company will file
a registration statement for use in an offering of the Registrable Securities
from time-to-time or a post-effective amendment to the Registration Statement
covering all of the Registrable Securities that will permit an offering of the
Registrable Securities from time-to-time and use its reasonable efforts to have
such registration statement or post-effective amendment declared effective as
soon as possible thereafter. The demand for registration may be made at any time
during a period of five (5) years beginning on the Effective Date. The Demand
Notice shall specify the intended method(s) of distribution of the Registrable
Securities. The Company will notify all holders of Purchase Options and/or
Registrable Securities of the receipt of such Demand Notice. Each holder of
Registrable Securities who wishes to include all or a portion of such holder's
Registrable Securities in the Demand Registration (each such holder including
shares of Registrable Securities in such registration, a "DEMANDING HOLDER")
shall so notify the Company within ten (10) days after the receipt by the holder
of the notice from the Company. Upon any such request, the Demanding Holders
shall be entitled to have their Registrable Securities included in the Demand
Registration, subject to any reductions pursuant to Section 6.1.4.
6.1.2 EFFECTIVE REGISTRATION. A registration will not count as
a Demand Registration until the registration statement filed with the Commission
with respect to such Demand Registration has been declared effective and the
Company has complied with all of its obligations under this Purchase Option with
respect thereto; provided, however, that if, after such registration statement
has been declared effective, the offering of Registrable Securities pursuant to
a Demand Registration is interfered with by any stop order or injunction of the
Commission or any other governmental agency or court, the registration statement
with respect to such Demand Registration will
6
be deemed not to have been declared effective unless and until such stop order
or injunction is removed, rescinded or otherwise terminated.
6.1.3 UNDERWRITTEN OFFERING. If the Majority Holders so elect
and such holders so advise the Company as part of the Demand Notice, the
offering of all or any portion of the Registrable Securities pursuant to such
Demand Registration shall be in the form of one underwritten offering. All
Demanding Holders proposing to distribute their securities through such
underwriting shall enter into an underwriting agreement in customary form with
the underwriter or underwriters selected for such underwriting by the Majority
Holders, which underwriter or underwriters shall be reasonably acceptable to the
Company.
6.1.4 REDUCTION OF OFFERING. If the managing underwriter or
underwriters for a Demand Registration that is to be an underwritten offering
advises the Company and the Demanding Holders in writing that the dollar amount
or amount of Registrable Securities which the Demanding Holders desire to sell
pursuant to the underwritten offering, taken together with all other shares of
Common Stock or other securities which the Company desires to sell and the
shares of Common Stock or other securities, if any, as to which registration has
been requested pursuant to written contractual piggy-back registration rights
held by other securityholders of the Company who desire to sell, exceeds the
maximum dollar amount or maximum number of securities that can be sold in such
offering without adversely affecting the proposed offering price, the timing,
the distribution method or the probability of success of such offering (such
maximum dollar amount or maximum number of securities, as applicable, the
"MAXIMUM NUMBER OF SECURITIES"), then the Company shall include in such
registration: (i) first, the Registrable Securities as to which Demand
Registration has been requested by the Demanding Holders that want to
participate in such underwritten offering (pro rata in accordance with the
number of shares that each such Person has requested be included in such
registration, regardless of the number of shares held by each such Person (such
proportion is referred to herein as "PRO RATA")) that can be sold without
exceeding the Maximum Number Of Securities; (ii) second, to the extent that the
Maximum Number Of Securities has not been reached under the foregoing clause
(i), the shares of Common Stock or other securities that the Company desires to
sell that can be sold without exceeding the Maximum Number Of Securities; (iii)
third, to the extent that the Maximum Number Of Securities has not been reached
under the foregoing clauses (i) and (ii), the shares of Common Stock or other
securities registrable pursuant to the terms of the Registration Rights
Agreement between the Company and the initial investors in the Company, dated as
of _________, 2007 (the "REGISTRATION RIGHTS AGREEMENT" and such registrable
securities, the "INVESTOR SECURITIES") as to which "PIGGY-BACK" registration has
been requested by the holders thereof, pro rata, that can be sold without
exceeding the Maximum Number Of Securities; and (iv) fourth, to the extent that
the Maximum Number Of Securities have not been reached under the foregoing
clauses (i), (ii), and (iii), the shares of Common Stock or other securities for
the account of other persons that the Company is obligated to register pursuant
to written contractual arrangements with such persons and that can be sold
without exceeding the Maximum Number Of Securities.
6.1.5 WITHDRAWAL. If a majority-in-interest, on an
as-converted to Common Stock basis, of the Demanding Holders disapprove of the
terms of any underwriting or are not entitled to include all of their
Registrable Securities in any offering, such majority-in-interest of the
Demanding Holders may elect to withdraw from such offering by giving written
notice to the Company and the underwriter or underwriters of their request to
withdraw prior to the effectiveness of the registration statement filed with the
Commission with respect to such Demand Registration.
6.1.6 TERMS. The Company shall bear all fees and expenses
attendant to registering the Registrable Securities, including the expenses of
one legal counsel selected by the Holders to represent them in connection with
the sale of the Registrable Securities, but the Holders shall pay any
7
and all underwriting commissions. The Company agrees to use its reasonable
efforts to qualify or register the Registrable Securities in such states as are
reasonably requested by the Majority Holder(s); provided, however, that in no
event shall the Company be required to register the Registrable Securities in a
state in which such registration would cause (i) the Company to be obligated to
qualify to do business in such state, or would subject the Company to taxation
as a foreign corporation doing business in such jurisdiction or (ii) the
principal stockholders of the Company to be obligated to escrow their shares of
capital stock of the Company. The Company shall use its reasonable efforts to
cause any registration statement or post-effective amendment filed pursuant to
the demand rights granted under Section 6.1.1 to remain effective until the
earlier of (a) the time all Registrable Securities covered by such registration
statement or post-effective amendment have been disposed of in accordance with
the intended method(s) of disposition set forth in the Demand Notice, and (b)
the expiration of the Warrants in accordance with the terms and conditions of
the Warrant Agreement.
6.1.7 PERMITTED DELAYS. The Company shall be entitled to
postpone the filing of a registration statement under this Section 6.1 if (a) at
any time prior to the filing of the registration statement, the Company's Board
of Directors determines, in its good faith business judgment, that such
registration and offering would materially and adversely affect any financing,
acquisition, corporate reorganization or other material transaction involving
the Company, and (b) the Company delivers to the Demanding Holders written
notice thereof within ten (10) business days of the date of the Company's
receipt of the Demand Notice; provided that such period of postponement may not
exceed 45 days.
6.2 PIGGY-BACK REGISTRATION.
6.2.1 PIGGY-BACK RIGHTS. If at any time during the seven (7)
year period commencing on the Effective Date the Company proposes to file a
registration statement under the Act with respect to an offering of equity
securities, or securities or other obligations exercisable or exchangeable for,
or convertible into, equity securities, by the Company for its own account
and/or for stockholders of the Company for their account (other than a
registration statement on Form S-4 or S-8 (or any successor or substantially
similar form), or in connection with (i) an employee stock option, stock
purchase or compensation plan or securities issued or issuable pursuant to any
such plan, (ii) a dividend reinvestment plan or (iii) an offering of debt that
is convertible into equity securities of the Company), then the Company shall
(x) give written notice of such filing to the holders of Registrable Securities,
which notice shall describe the amount and type of securities to be included in
such offering, the intended method(s) of distribution, and the name of the
proposed managing underwriter or underwriters, if any, of the offering, and (y)
offer to the holders of Registrable Securities in such notice the opportunity to
register the sale of such number of shares of Registrable Securities as such
holders may request in writing within five (5) days following receipt of such
notice (a "PIGGY-BACK REGISTRATION"). The Company shall cause such Registrable
Securities to be included in such registration and shall use its reasonable
efforts to cause the managing underwriter or underwriters of a proposed
underwritten offering to permit the Registrable Securities requested to be
included in a Piggy-Back Registration on the same terms and conditions as any
similar securities of the Company and to permit the sale or other disposition of
such Registrable Securities in accordance with the intended method(s) of
distribution thereof. All holders of Registrable Securities proposing to
distribute their securities through a Piggy-Back Registration that involves an
underwriter or underwriters shall enter into an underwriting agreement in
customary form with the underwriter or underwriters selected for such Piggy-Back
Registration.
6.2.2 REDUCTION OF OFFERING. If the managing underwriter or
underwriters for a Piggy-Back Registration that is to be an underwritten
offering advises the Company and the holders of Registrable Securities in
writing that the dollar amount or amount of securities which the Company desires
to sell, taken together with securities, if any, as to which registration has
been
8
demanded pursuant to written contractual arrangements with persons other than
the holders of Registrable Securities hereunder, the Registrable Securities as
to which registration has been requested under this Section 6.2, and the
securities, if any, as to which registration has been requested pursuant to the
written contractual piggy-back registration rights of other stockholders of the
Company, exceeds the Maximum Number Of Securities, then the Company shall
include in any such registration:
(a) If the registration is undertaken for the Company's
account: (i) first, the shares of Common Stock or other securities that the
Company desires to sell that can be sold without exceeding the Maximum Number Of
Securities; (ii) second, to the extent that the Maximum Number Of Securities has
not been reached under the foregoing clause (i), the shares of Common Stock or
other securities, if any, comprised of Registrable Securities and Investor
Securities, as to which registration has been requested pursuant to the
applicable written contractual piggy-back registration rights of such security
holders, pro rata, that can be sold without exceeding the Maximum Number Of
Securities; and (iii) third, to the extent that the Maximum Number Of Securities
has not been reached under the foregoing clauses (i) and (ii), the shares of
Common Stock or other securities for the account of other persons that the
Company is obligated to register pursuant to written contractual piggy-back
registration rights with such persons and that can be sold without exceeding the
Maximum Number Of Securities;
(b) If the registration is a "demand" registration undertaken
at the demand of holders of Investor Securities, (i) first, the shares of Common
Stock or other securities for the account of the demanding persons, Pro Rata,
that can be sold without exceeding the Maximum Number Of Securities; (ii)
second, to the extent that the Maximum Number Of Securities has not been reached
under the foregoing clause (i), the shares of Common Stock or other securities
that the Company desires to sell that can be sold without exceeding the Maximum
Number Of Securities; (iii) third, to the extent that the Maximum Number Of
Securities has not been reached under the foregoing clauses (i) and (ii), the
shares of Registrable Securities, pro rata, as to which registration has been
requested pursuant to the terms hereof, that can be sold without exceeding the
Maximum Number Of Securities; and (iv) fourth, to the extent that the Maximum
Number Of Securities has not been reached under the foregoing clauses (i), (ii)
and (iii), the shares of Common Stock or other securities for the account of
other persons that the Company is obligated to register pursuant to written
contractual arrangements with such persons, that can be sold without exceeding
the Maximum Number Of Securities; and
(c) If the registration is a "demand" registration undertaken
at the demand of persons other than either the holders of Registrable Securities
or of Investor Securities, (i) first, the shares of Common Stock or other
securities for the account of the demanding persons that can be sold without
exceeding the Maximum Number Of Securities; (ii) second, to the extent that the
Maximum Number Of Securities has not been reached under the foregoing clause
(i), the shares of Common Stock or other securities that the Company desires to
sell that can be sold without exceeding the Maximum Number Of Securities; (iii)
third, to the extent that the Maximum Number Of Securities has not been reached
under the foregoing clauses (i) and (ii), collectively the shares of Common
Stock or other securities comprised of Registrable Securities and Investor
Securities, pro rata, as to which registration has been requested pursuant to
the terms hereof and of the Registration Rights Agreement, as applicable, that
can be sold without exceeding the Maximum Number Of Securities; and (iv) fourth,
to the extent that the Maximum Number Of Securities has not been reached under
the foregoing clauses (i), (ii) and (iii), the shares of Common Stock or other
securities for the account of other persons that the Company is obligated to
register pursuant to written contractual arrangements with such persons, that
can be sold without exceeding the Maximum Number Of Securities.
6.2.3 WITHDRAWAL. Any holder of Registrable Securities may
elect to withdraw such xxxxxx's request for inclusion of Registrable Securities
in any Piggy-Back Registration by giving written notice to the Company of such
request to withdraw prior to the effectiveness of the
9
registration statement. The Company (whether on its own determination or as the
result of a withdrawal by persons making a demand pursuant to written
contractual obligations) may withdraw (or postpone the filing of) a registration
statement at any time prior to the effectiveness of the registration statement.
Notwithstanding any such withdrawal, the Company shall pay all expenses incurred
by the holders of Registrable Securities in connection with such Piggy-Back
Registration as provided in Section 6.2.4.
6.2.4 TERMS. The Company shall bear all fees and expenses
attendant to registering the Registrable Securities, including the expenses of
one legal counsel selected by the Holders to represent them in connection with
the sale of the Registrable Securities but the Holders shall pay any and all
underwriting commissions related to the Registrable Securities. During the
period in which the Purchase Option is exercisable, the notice required under
Section 6.2.1 to the Holders shall continue to be given for each applicable
registration statement filed by the Company until such time as all of the
Registrable Securities have been registered and sold.
6.3 GENERAL TERMS.
6.3.1 INDEMNIFICATION. The Company shall indemnify the
Holder(s) of the Registrable Securities to be sold pursuant to any registration
statement hereunder 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 (the "EXCHANGE ACT"), against all loss, claim, damage,
expense or liability (including all reasonable attorneys' fees and other
expenses reasonably incurred in investigating, preparing or defending against
litigation, commenced or threatened, or any claim whatsoever whether arising out
of any action between the underwriter and the Company or between the underwriter
and any third party or otherwise) to which any of them may become subject under
the Act, the Exchange Act or otherwise, arising, in each case, 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
underwriters contained in Section 8 of the Underwriting Agreement between the
Company, Xxxxxxx X'Xxxxx and the other underwriters named therein dated the
Effective Date. The Holder(s) of the Registrable Securities to be sold pursuant
to such 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, expense or liability (including all reasonable attorneys' fees and other
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 information furnished by or on behalf of
such Holders, or their successors or assigns, in writing, for specific inclusion
in such registration statement to the same extent and with the same effect as
the provisions contained in Section 8 of the Underwriting Agreement pursuant to
which the underwriters have agreed to indemnify the Company.
6.3.2 EXERCISE OF PURCHASE OPTIONS. Nothing contained in this
Purchase Option shall be construed as requiring the Holder(s) to exercise their
Purchase Options or the Warrants underlying such Purchase Options prior to or
after the initial filing of any registration statement or the effectiveness
thereof.
6.3.3 DOCUMENTS DELIVERED TO HOLDERS. If such registration
includes an underwritten public offering, the Company shall deliver such
documents and certificates as may be reasonably requested by the participating
Holders and the managing underwriters, including customary opinions of counsel
and "cold comfort" letters as may be reasonably required pursuant to the
underwriting agreement relating thereto. The Company shall also deliver promptly
to the Holders participating in the offering the correspondence and memoranda
described below and copies of all correspondence between the Commission and the
Company, its counsel or auditors and all memoranda
10
relating to discussions with the Commission or its staff with respect to the
registration statement and permit the Holders 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 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 the Holders shall reasonably request. The
Company shall not be required to disclose any confidential information or other
records to the Holders, or to any other person, until and unless such persons
shall have entered into reasonable confidentiality agreements (in form and
substance reasonably satisfactory to the Company) with the Company with respect
thereto.
6.3.4 UNDERWRITING AGREEMENT. The Company shall enter into an
underwriting agreement with the managing underwriter(s), if any, selected
pursuant to Section 6.1.3. Such agreement shall be reasonably satisfactory in
form and substance to the Company, each Holder party thereto 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. Each Holder intending to register
securities pursuant to this Section 6 shall be party to any underwriting
agreement relating to an underwritten sale of its Registrable Securities and
may, at its 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 agree to such
representations, warranties, covenants and indemnification and contribution
obligations for selling stockholders as are customarily contained in agreements
of that type used by the managing underwriter. Further, such Holders shall
execute appropriate custody agreements and otherwise cooperate fully in the
preparation of the registration statement and other documents relating to any
offering in which they include securities pursuant to this Section 6. Each
Holder shall also furnish to the Company such information regarding itself, the
Registrable Securities held by it, and the intended method of disposition of
such securities as shall be reasonably required to effect the registration of
the Registrable Securities.
6.3.5 RULE 144 SALE. Notwithstanding anything contained in
this Section 6 to the contrary, the Company shall have no obligation pursuant to
Sections 6.1 or 6.2 for the registration of Registrable Securities held by any
Holder (i) where such Holder would then be entitled to sell under Rule 144 under
the Act ("RULE 144") within any three-month period (or such other period
prescribed under Rule 144 as may be provided by amendment thereof) all of the
Registrable Securities then held by such Holder, and (ii) where the number of
Registrable Securities held by such Holder is within the volume limitations
under paragraph (e) of Rule 144 (calculated as if such Holder were an affiliate
within the meaning of Rule 144).
6.3.6 SUPPLEMENTAL PROSPECTUS. Each Holder agrees, that upon
receipt of any notice from the Company of the happening of any event as a result
of which the prospectus included in the registration statement, as then in
effect, includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances then existing, such Holder
will immediately discontinue disposition of Registrable Securities pursuant to
the registration statement covering such Registrable Securities until such
Xxxxxx's receipt of the copies of a supplemental or amended prospectus, and, if
so desired by the Company, such Holder shall deliver to the Company (at the
expense of the Company) or destroy (and deliver to the Company a certificate of
such destruction) all copies, other than permanent file copies then in such
Holder's possession, of the prospectus covering such Registrable Securities
current at the time of receipt of such notice.
11
7. 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 exercise of the Purchase Options or the Warrants underlying the
Purchase Option, 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 Purchase Options 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 and
non-assessable and not subject to preemptive rights of any stockholder. The
Company further covenants and agrees that upon exercise of the Warrants
underlying the Purchase Options and payment of the respective Warrant exercise
price therefor, all shares of Common Stock and other securities issuable upon
such exercise shall be duly and validly issued, fully paid and non-assessable
and not subject to preemptive rights of any stockholder. As long as the Purchase
Options shall be outstanding, the Company shall use its reasonable efforts to
cause all (i) Units and shares of Common Stock issuable upon exercise of the
Purchase Options, (ii) Warrants issuable upon exercise of the Purchase Options
and (iii) shares of Common Stock issuable upon exercise of the Warrants included
in the Units issuable upon exercise of the Purchase Option to be listed (subject
to official notice of issuance) on all securities exchanges (or, if applicable
on the Nasdaq National Market, SmallCap Market, OTC Bulletin Board or any
successor trading market) on which the Units, the Common Stock or the Public
Warrants issued to the public in connection herewith may then be listed and/or
quoted.
8. CERTAIN NOTICE REQUIREMENTS.
8.1 HOLDERS RIGHT TO RECEIVE NOTICE. Nothing herein shall be
construed as conferring upon the Holders the right to vote or consent as a
stockholder 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 Purchase Options and their exercise, any of the
events described in Section 8.2 shall occur, then, in one or more of said
events, the Company shall give written notice of such event at least ten (10)
days prior to the date fixed as a record date or the date of closing the
transfer books for the determination of the stockholders entitled to such
dividend, distribution, conversion or exchange of securities or subscription
rights, or entitled to vote on such proposed dissolution, liquidation, winding
up or sale. Such notice shall specify such record date or the date of the
closing of the transfer books, as the case may be. Notwithstanding the
foregoing, the Company shall deliver to each Holder a copy of each notice given
to the other stockholders of the Company at the same time and in the same manner
that such notice is given to the stockholders.
8.2 EVENTS REQUIRING NOTICE. The Company shall be required to give
the notice described in this Section 8 upon one or more of the following events:
(i) if 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 retained earnings, as indicated by the accounting
treatment of such dividend or distribution on the books of the Company, or (ii)
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 (iii) 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 shall be
proposed.
8.3 NOTICE OF CHANGE IN EXERCISE PRICE. The Company shall, promptly
after an event requiring a change in the Exercise Price pursuant to Section 2
hereof, send notice to the Holders of such event and change (the "PRICE
NOTICE"). The Price Notice shall describe the event causing the change and the
method of calculating same and shall be certified as being true and accurate by
the Company's Chief Financial Officer.
12
8.4 TRANSMITTAL OF NOTICES. All notices, requests, consents and
other communications under this Purchase Option shall be in writing and shall be
deemed to have been duly made when hand delivered, or mailed by United States
postal service, express mail or private courier service: (i) if to the
registered Holder of the Purchase Option, to the address of such Holder as shown
on the books of the Company, or (ii) if to the Company, to the following address
or to such other address as the Company may designate by notice to the Holders:
Western United Financial Corporation
00 Xxxxx Xxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxxxx 00000
Attn: X. Xxxxxxx Xxxxxxx
with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxx X. Xxxx, Esq.
Xxxxx Xxxxx, Esq.
9. MISCELLANEOUS.
9.1 AMENDMENTS. The Company may from time to time supplement or
amend this Purchase Option without the approval of any of the Holders in order
to cure any ambiguity, to correct or supplement any provision contained herein
that may be defective or inconsistent with any other provisions herein, or to
make any other provisions in regard to matters or questions arising hereunder
that the Company may deem necessary or desirable and that the Company, in the
exercise of reasonable judgment, determines that it shall not materially
adversely affect the interest of the Holders. All other modifications or
amendments shall require the written consent of the Majority Holders.
9.2 HEADINGS. The headings contained herein are for the sole purpose
of convenience of reference, and shall not in any way limit or affect the
meaning or interpretation of any of the terms or provisions of this Purchase
Option.
9.3 ENTIRE AGREEMENT. This Purchase Option (together with the
Warrant Agreement and the other agreements and documents being delivered
pursuant to or in connection with this Purchase Option) constitutes the entire
agreement of the parties hereto with respect to the subject matter hereof, and
supersedes all prior agreements and understandings of the parties, oral and
written, with respect to the subject matter hereof.
9.4 BINDING EFFECT. This Purchase Option shall inure solely to the
benefit of and shall be binding upon, the Holder and the Company and their
permitted assignees, respective successors, legal representative and assigns,
and no other person shall have or be construed to have any legal or equitable
right, remedy or claim under or in respect of or by virtue of this Purchase
Option or any provisions herein contained.
9.5 GOVERNING LAW; SUBMISSION TO JURISDICTION. This Purchase Option
shall be governed by, and construed in accordance with, the laws of the State of
New York applicable to contracts executed in and to be performed in that State,
including, without limitation, Sections 5-1401 and 5-1402 of the New York
General Obligations Law and the New York Civil Practice Laws and Rules 327(b).
The Company hereby agrees that any action, proceeding or claim against it
13
arising out of or relating in any way to this Agreement shall be brought and
enforced in the courts of the State of New York or the United States District
Court for the Southern District of New York, and irrevocably submit to such
jurisdiction, which jurisdiction shall be exclusive. The Company hereby waives
any objection to such exclusive jurisdiction and that such courts represent an
inconvenient forum. Any process or summons to be served upon the Company 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 8 hereof. Such mailing shall be deemed personal service and shall be
legal and binding upon the Company in any action, proceeding or claim. The
Company and the Holder agree that the prevailing party(ies) in any such action
shall be entitled to recover from the other party(ies) all of its reasonable
attorneys, fees and expenses relating to such action or proceeding and/or
incurred in connection with the preparation therefor.
9.6 WAIVER, ETC. The failure of the Company or the Holder to at any
time enforce any of the provisions of this Purchase Option shall not be deemed
or construed to be a waiver of any such provision, nor to in any way affect the
validity of this Purchase Option or any provision hereof or the right of the
Company or any Holder to thereafter enforce each and every provision of this
Purchase Option. No waiver of any breach, non-compliance or non-fulfillment of
any of the provisions of this Purchase Option shall be effective unless set
forth in a written instrument executed by the party or parties against whom or
which enforcement of such waiver is sought; and no waiver of any such breach,
non-compliance or non-fulfillment shall be construed or deemed to be a waiver of
any other or subsequent breach or non-compliance.
9.7 EXECUTION IN COUNTERPARTS. This Purchase Option may be executed
in one or more counterparts, and by the different parties hereto in separate
counterparts, each of which shall be deemed to be an original, but all of which
taken together shall constitute one and the same agreement, and shall become
effective when one or more counterparts has been signed by each of the parties
hereto and delivered to each of the other parties hereto.
9.8 UNDERLYING WARRANTS. At any time after exercise by the Holder of
this Purchase Option, the Holder may exchange its Warrants (with an initial
exercise price of $7.50) for Public Warrants (with an initial exercise price of
$6.00) upon payment to the Company of the difference between the exercise price
of its Warrant and the exercise price of the Public Warrants. Any such Public
Warrants and the Common Stock underlying such Public Warrants shall constitute
Registrable Securities.
IN WITNESS WHEREOF, the Company has caused this Purchase Option to
be signed by its duly authorized officer as of the _______________ day of ___,
2007.
WESTERN UNITED FINANCIAL CORPORATION
By:_________________________________
Name: X. Xxxxxxx Xxxxxxx
Title: Chief Executive Officer
14
[Unit Purchase Option]
FORM TO BE USED TO EXERCISE PURCHASE OPTION:
Western United Financial Corporation
00 Xxxxx Xxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxxxx 00000
Attn: X. Xxxxxxx Xxxxxxx
Date: __________________, 200__
The undersigned hereby elects irrevocably to exercise all or a
portion of the within Purchase Option and to purchase _____ Units of Western
United Financial Corporation and hereby makes payment of $________ (at the rate
of $_________ per unit) in payment of the Exercise Price pursuant thereto.
Please issue the Common Stock and Warrants as to which this Purchase Option is
exercised in accordance with the instructions given below.
or
The undersigned hereby elects irrevocably to convert its right to
purchase _____ Units purchasable under the within Purchase Option by surrender
of the unexercised portion of the attached Purchase Option (with a "VALUE" based
of $_______ based on a "MARKET PRICE" of $______). Please issue the securities
comprising the Units as to which this Purchase Option is exercised in accordance
with the instructions given below.
______________________________________
NOTICE The signature to this exercise
notice must correspond with the name
as written upon the face of the
purchase option in every particular,
without alteration or enlargement or
any change whatever.
Signature(s) Guaranteed:
--------------------------------------------------------------------------------
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION
(BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH
MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM, PURSUANT TO
SECURITIES AND EXCHANGE COMMISSION RULE 17Ad-15).
INSTRUCTIONS FOR REGISTRATION OF SECURITIES
Name
-----------------------------------------------------------------------
(Print in Block Letters)
Address
-----------------------------------------------------------------------
-----------------------------------------------------------------------
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FORM TO BE USED TO ASSIGN PURCHASE OPTION:
ASSIGNMENT
(To be executed by the registered Holder to effect a
transfer of the within Purchase Option):
FOR VALUE RECEIVED, _____________________ does hereby sell, assign
and transfer unto _________________ the right to purchase ________________ Units
of Western United Financial Corporation (the "COMPANY") evidenced by the within
Purchase Option and does hereby authorize the Company to transfer such right on
the books of the Company.
Dated: __________ __, 200_
______________________________________
Signature
______________________________________
NOTICE The signature to this
assignment must correspond with the
name as written upon the face of the
purchase option in every particular,
without alteration or enlargement or
any change whatever.
Signature(s) Guaranteed:
--------------------------------------------------------------------------------
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION
(BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH
MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM, PURSUANT TO
SECURITIES AND EXCHANGE COMMISSION RULE 17Ad-15).
EXHIBIT A
FORM OF WARRANT
