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Exhibit 17
WARRANT AGREEMENT
THIS WARRANT AGREEMENT (the "Agreement") is made and entered
into as of July 20, 2001 between CBRE Holding, Inc., a Delaware corporation (the
"Company") and FS Equity Partners III, L.P., a Delaware limited partnership
("FSEP"), and FS Equity Partners International, L.P., a Delaware limited
partnership ("FSEP International," and together with FSEP, the "FS Parties").
WHEREAS, pursuant to that certain Agreement and Plan of
Reorganization, dated as of May 14, 1997 by and among CB Xxxxxxx Xxxxx Services,
Inc. (successor to CB Commercial Real Estate Services Group, Inc.) ("CBRE"),
Xxxx Real Estate Services ("KRES") and the other parties listed therein, KRES
merged with a subsidiary of CBRE and the holders of shares of common stock of
KRES, including the FS Parties, and options exercisable into shares of common
stock of KRES received warrants (the "Old Warrants") to purchase up to an
aggregate of 500,000 shares of the Common Stock of CBRE;
WHEREAS, pursuant to that certain Amended and Restated
Agreement and Plan of Merger (the "Merger Agreement"), dated as of May 31, 2001,
by and among, CBRE, the Company and XXXX XX Corp., a Delaware corporation and
wholly owned subsidiary of the Company (the "Acquiror"), the Acquiror will merge
with and into CBRE, such that CBRE shall become a wholly owned subsidiary of the
Company; and
WHEREAS, pursuant to that certain Amended and Restated
Contribution and Voting Agreement, dated as of May 31, 2001, by and among, the
Company, the FS Parties and the other parties thereto, upon the Closing, among
other things, (i) the Company shall cancel the Old Warrants, and (ii) the FS
Parties shall receive, in the aggregate, warrants, evidenced by a Warrant
Certificate in substantially the form attached hereto as Exhibit A (the
"Warrants"), to purchase up to an aggregate of [number of shares of Common Stock
equal to the number that represents the same percentage of the total outstanding
shares of Common Stock immediately after consummation of the Merger (with
respect to the Company) as the warrants to acquire 364,884 shares of CBRE Common
Stock entitled Xxxxxxx Xxxxxx immediately prior to the consummation of the
Merger (with respect to CBRE)] shares (the "Warrant Shares") of the Class B
Common Stock, par value $.01 per share (the "Common Stock"), of the Company.
NOW THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereto agree as follows (capitalized
terms used herein and not otherwise defined have the meanings ascribed thereto
in the Merger Agreement):
OPTIONAL EXERCISE OF WARRANT.
Subject to the terms of this Agreement, each holder of a
Warrant may, at any time on and after August 26, 2007, but not later than August
27, 2007 (the "Expiration Date"),
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exercise this Warrant in whole at any time or in part from time to time for the
number of Warrant Shares which such holder is then entitled to purchase
hereunder.
Each holder of a Warrant may exercise such Warrant, in whole
or in part by either of the following methods:
delivering to the Company at its office maintained for such
purpose pursuant to Section 12(d): (i) a written notice of such holder's
election to exercise such Warrant, which notice shall specify the number of
Warrant Shares to be purchased, (ii) the Warrant and (iii) a sum equal to the
Exercise Price (as set forth in the Warrant) therefor payable in immediately
available funds; or
The holder of a Warrant may also exercise such Warrant, in
whole or in part, in a "cashless" or "net-issue" exercise by delivering to the
Company at its office maintained for such purpose pursuant to Section 12(d): (i)
a written notice of such holder's election to exercise such Warrant, which
notice shall specify the number of Warrant Shares to be delivered to such holder
and the number of Warrant Shares with respect to which such Warrant is being
surrendered in payment of the aggregate Exercise Price for the Warrant Shares to
be delivered to the holder, and (ii) the Warrant. For purposes of this
provision, all Warrant Shares as to which the Warrant is surrendered will be
attributed a value equal to (x) the current market price per share of Common
Stock (determined in the manner set forth in Section 7(f)) minus (y) the current
Exercise Price per share of Common Stock.
Such notice may be in the form of Election to Purchase
substantially in the form of Exhibit B attached hereto. Upon delivery thereof,
together with the Warrant and the Exercise Price, as applicable, and such holder
becoming a party to the Securityholders' Agreement, dated as of the date hereof
(the "Securityholders' Agreement"), by and among the Company, the FS Parties and
the other parties thereto if such holder shall not already be a party thereto,
the Company shall cause to be executed and delivered to such holder within five
business days a certificate or certificates representing the aggregate number of
fully-paid and nonassessable shares of Common Stock issuable upon such exercise.
The stock certificate or certificates for Warrant Shares so
delivered shall be in such denominations as may be specified in said notice and
shall be registered in the name of such holder or such other name or names as
shall be designated in said notice. Such certificate or certificates shall be
deemed to have been issued and such holder or any other person so designated to
be named therein shall be deemed to have become a holder of record of such
shares, including to the extent permitted by law the right to vote such shares
or to consent or to receive notice as a stockholder (subject to the terms of the
Securityholders' Agreement), as of the time said notice is delivered to the
Company as aforesaid; provided that such shares shall be subject to the
provisions of the Securityholders' Agreement. If a Warrant shall have been
exercised only in part, the Company shall, at the time of delivery of said
certificate or certificates, deliver to such holder a new Warrant dated the date
it is issued, evidencing the rights of such holder to purchase the remaining
Warrant Shares called for by this Warrant, which new Warrant shall in all other
respects be identical with this Warrant, or, at the request of such holder,
appropriate notation may be made on this Warrant and the Warrant shall be
returned to such holder.
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All Warrant Shares issuable upon the exercise of a Warrant
shall be validly issued, fully paid and nonassessable and free from all liens
and other encumbrances thereon, other than liens or other encumbrances created
by the holder thereof or the restrictions set forth in the Securityholders'
Agreement.
The Company will not close its books against the transfer of a
Warrant or of any Warrant Shares in any manner which interferes with the timely
exercise of a Warrant. The Company will from time to time take all such action
as may be necessary to assure that the par value per share of the unissued
Common Stock acquirable upon exercise of a Warrant is at all times equal to or
less than the Exercise Price then in effect.
AUTOMATIC EXERCISE OF WARRANT.
Notwithstanding the prior delivery of a notice pursuant to
Section 1 hereto, in the event an Automatic Exercise Event (as defined below)
occurs prior to the Expiration Date, without any action by the Company or the FS
Parties, the Warrants shall automatically be exercised in a "cashless" or "net
issue" exercise pursuant to which (i) the Exercise Price shall be paid to the
Company entirely in Warrant Shares (or such other consideration as set forth in
Section 7(l) hereto), which for purposes of this provision, will be attributed a
value equal to (x) the current market price per share of Common Stock
(determined in the manner set forth in Section 7(f)) to the holders thereof
minus (y) the current Exercise Price per share of Common Stock, and (ii) the
Company, subject to the following paragraph of this Section 2, shall deliver to
the holders thereof the number of Warrant Shares remaining after subtracting the
Exercise Price; provided, however that if, upon an Automatic Exercise Event, the
amount set forth in subclause (y) of the foregoing clause (i) shall be equal to
or greater than the amount set forth in subclause (x) of the foregoing clause
(i), then the Warrants, without any action by the Company or the FS Parties,
shall be cancelled and shall cease to represent the right to receive any Warrant
Shares or other security, property or asset of the Company or any surviving
entity.
As soon as practicable after an Automatic Exercise Event, the
Company shall deliver a notice of such Automatic Exercise Event to each of the
holders of the Warrants. Upon delivery of the Warrants to the Company by a
holder thereof and such holder becoming a party to the Securityholders'
Agreement, if such holder shall not already be a party thereto, the Company
shall cause to be executed and delivered to such holder within five business
days a certificate or certificates representing the aggregate number of
fully-paid and nonassessable shares of Common Stock issuable as a result of such
Automatic Exercise Event.
The stock certificate or certificates for Warrant Shares so
delivered shall be in such denominations as may be specified by the Warrant
holders and shall be registered in the name of such holder or such other name or
names as shall be designated by the Warrant holders . Such certificate or
certificates shall be deemed to have been issued and such holder or any other
person so designated to be named therein shall be deemed to have become a holder
of record of such shares, including to the extent permitted by law the right to
vote such shares or to consent or to receive notice as a stockholder (subject to
the terms of the Securityholders' Agreement), as of the time of the Automatic
Exercise Event; provided that such shares shall be subject to the provisions of
the Securityholders' Agreement.
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All Warrant Shares issuable upon an Automatic Exercise Event
shall be validly issued, fully paid and nonassessable and free from all liens
and other encumbrances thereon, other than liens or other encumbrances created
by the holder thereof or the restrictions set forth in the Securityholders'
Agreement.
The Company will not close its books against the transfer of a
Warrant or of any Warrant Shares in any manner which interferes with the
exercise of a Warrant pursuant to an Automatic Exercise Event. The Company will
from time to time take all such action as may be necessary to assure that the
par value per share of the unissued Common Stock acquirable upon exercise of a
Warrant pursuant to an Automatic Exercise Event is at all times equal to or less
than the Exercise Price then in effect.
For purposes of this Agreement, an "Automatic Exercise Event"
shall mean either (a) the completion of a sale of shares of any class of the
Common Stock to the public pursuant to an effective registration statement
(other than a registration statement on Form S-8 or any similar or successor
form) filed under the Securities Act pursuant to which the Company becomes
listed on a national securities exchange or on the NASDAQ Stock Market (the
"Initial Public Offering"), (b) any "person" or "group," (each as defined in
Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, as amended (the
"Exchange Act")) other than XXXX Capital Partners, L.P. ("XXXX") and its
affiliates, is or becomes the "beneficial owner" (as defined in Rules 13d-3 and
13d-5 under the Exchange Act), directly or indirectly, of more than 50% of the
total voting power of the outstanding voting stock of the Company, including by
way of merger, consolidation or otherwise, and XXXX and its affiliates cease to
control the Company's Board of Directors, (c) any sale of all or substantially
all of the assets of the Company and its subsidiaries to any "person" or
"group," (each as defined in Rules 13d-3 and 13d-5 under the Exchange Act) other
than XXXX and its affiliates, or (d) any merger, consolidation or other
transaction or series or related transactions after the consummation of which
the shares owned by the holders of the Company's outstanding voting stock
possessing a majority of the voting power to elect the Company's Board of
Directors immediately prior to the occurrence of such transaction or
transactions cease to constitute a majority of the Company's outstanding voting
stock possessing the voting power to elect the Company's Board of Directors (or
equivalent governing body).
TRANSFER, DIVISION AND COMBINATION.
Subject to the Securityholders' Agreement, the Warrants are,
and all rights thereunder are, transferable, in whole or in part, on the books
of the Company to be maintained for such purpose, upon (a) surrender of a
Warrant at the office of the Company maintained for such purpose pursuant to
Section 12(d), together with a written assignment of such Warrant duly executed
by the holder thereof or its agent or attorney and payment of funds sufficient
to pay any stock transfer taxes payable upon the making of such transfer, and
(b) a signed agreement by the assignee or assignees to become a party to the
Securityholders' Agreement prior to the exercise of such Warrant, provided,
that, if Warrants are transferred to any person or entity that is entitled to
hold only Class A Common Shares, par value $0.01, of the Company ("Class A
Common Shares") pursuant to the terms of the Company's Amended and Restated
Certificate of Incorporation or the Securityholders' Agreement then such
transferred Warrants shall only be exercisable for Class A Common Shares. Upon
such surrender and, if required, such payment, the Company shall, execute and
deliver a new Warrant or Warrants in the name of the assignee
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or assignees and in the denominations specified in such instrument of
assignment, and the surrendered Warrant shall promptly be canceled. If and when
a Warrant is assigned in blank, the Company may (but shall not be obligated to)
treat the bearer thereof as the absolute owner of such Warrant for all purposes
and the Company shall not be affected by any notice to the contrary. A Warrant,
if properly assigned in compliance with this Section 3, may be exercised by an
assignee for the purchase of shares of Common Stock or Class A Common Stock, as
the case may be, without having a new Warrant issued.
A Warrant may, be divided or combined with other Warrants upon
presentation at the aforesaid office of the Company, together with a written
notice specifying the names and denominations in which new Warrants are to be
issued, signed by the holder hereof or its agent or attorney. Subject to
compliance with the preceding paragraph, as to any transfer which may be
involved in such division or combination, the Company shall execute and deliver
a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided
or combined in accordance with such notice.
The Company agrees to maintain at its aforesaid office books
for the registration and transfer of the Warrants.
PAYMENT OF TAXES.
The Company will pay all documentary stamp taxes attributable
to the initial issuance of Warrant Shares upon the exercise of Warrants;
provided, however, that the Company shall not be required to pay any tax or
taxes which may be payable in respect of any transfer involved in the issue of
any Warrants or any certificates for Warrant Shares in a name other than that of
the registered holder of a Warrant surrendered upon the exercise of a Warrant,
and the Company shall not be required to issue or deliver such Warrant 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.
MUTILATED OR MISSING WARRANTS.
In case any of the Warrant shall be mutilated, lost, stolen or
destroyed, the Company may in its discretion issue, in exchange and substitution
for and upon cancellation of the mutilated Warrant, or in lieu of and
substitution for the Warrant lost, stolen or destroyed, a new Warrant of like
tenor and representing an equivalent number of Warrants, but only upon receipt
of evidence satisfactory to the Company of such loss, theft or destruction of
such Warrant and indemnity, if requested, also satisfactory to them. Applicants
for such substitute Warrants shall also comply with such other reasonable
regulations and pay such other reasonable charges as the Company may prescribe.
RESERVATION OF WARRANT SHARES.
The Company will at all times reserve and keep available, free
from preemptive rights, out of the aggregate of its authorized but unissued
Common Stock or its authorized and issued Common Stock held in its treasury, for
the purpose of enabling it to satisfy any obligation to issue Warrant Shares
upon exercise of Warrants, the maximum number of shares of Common Stock which
may then be deliverable upon the exercise of all outstanding Warrants.
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The Company or, if appointed, the transfer agent for the
Common Stock (the "Transfer Agent") and every subsequent transfer agent for any
shares of the Company's capital stock issuable upon the exercise of any of the
rights of purchase aforesaid will be irrevocably authorized and directed at all
times to reserve such number of authorized shares as shall be required for such
purpose. The Company will keep a copy of this Agreement on file with the
Transfer Agent and with every subsequent transfer agent for any shares of the
Company's capital stock issuable upon the exercise of the rights of purchase
represented by the Warrants. The Company will furnish such Transfer Agent a copy
of all notices of adjustments and certificates related thereto transmitted to
each holder pursuant to Section 9 hereof.
ADJUSTMENT OF EXERCISE PRICE.
The Exercise Price and the number of Warrant Shares issuable
upon the exercise of each Warrant are subject to adjustment from time to time
upon the occurrence of the events enumerated in this Section 7. For purposes of
this Section 7, "Common Stock" means shares now or hereafter authorized of any
class of common stock of the Company and any other stock of the Company, however
designated, that has the right (subject to any prior rights of any class or
series of preferred stock) to participate in any distribution of the assets or
earnings of the Company without limit as to per share amount.
Adjustment for Change in Capital Stock.
If the Company:
pays a dividend or makes a distribution on its Common Stock in shares of its
Common Stock;
subdivides its outstanding shares of Common Stock into a greater number of
shares;
combines its outstanding shares of Common Stock into a smaller number of shares;
makes a distribution on its Common Stock in shares of its capital stock other
than Common Stock; or
issues by reclassification of its Common Stock any shares of its capital stock;
then the Exercise Price in effect immediately prior to such action and the
number and kind of shares into which a Warrant is exercisable shall all be
adjusted appropriately so that the holder of any Warrant thereafter exercised
may receive the aggregate number and kind of shares of capital stock of the
Company which he would have owned immediately following such action if such
Warrant had been exercised immediately prior to such action.
The adjustment shall become effective immediately after the
record date in the case of a dividend or distribution and immediately after the
effective date in the case of a subdivision, combination or reclassification.
If after an adjustment a holder of a Warrant upon exercise of
it may receive shares of two or more classes of capital stock of the Company,
the Board of Directors of the Company shall determine the allocation of the
adjusted Exercise Price between the classes of capital stock.
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After such allocation, the exercise privilege and the Exercise Price of each
class of capital stock shall thereafter be subject to adjustment on terms
comparable to those applicable to Common Stock in this Section.
Such adjustment shall be made successively whenever any event
listed above shall occur.
Adjustment for Rights Issue.
If the Company distributes any rights, options or warrants to
all holders of its Common Stock entitling them for a period expiring within 60
days after the record date for such distribution to purchase shares of Common
Stock at a price per share less than the current market price per share on that
record date, the Exercise Price shall be adjusted in accordance with the
formula:
O + N x P
-----------
E' = E x M
-----------
O + N
where:
E' = the adjusted Exercise Price.
E = the current Exercise Price.
O = the number of shares of Common Stock outstanding on the
record date.
N = the number of additional shares of Common Stock offered
pursuant to such rights issue.
P = the offering price per share of the additional shares.
M = the current market price per share of Common Stock on
the record date.
The adjustment shall be made successively whenever any such
rights, options or warrants are issued and shall become effective immediately
after the record date for the determination of stockholders entitled to receive
the rights, options or warrants. If at the end of the period during which such
rights, options or warrants are exercisable, not all rights, options or warrants
shall have been exercised, the Exercise Price shall be immediately readjusted to
what it would have been if "N" in the above formula had been the number of
shares actually issued.
Adjustment for Other Distributions.
If the Company distributes to all holders of its Common Stock
any assets (excluding cash) or debt securities or any rights or warrants to
purchase debt securities, assets or other securities, the Exercise Price shall
be adjusted in accordance with the formula:
E' = E x M - F
----------
M
where:
E' = the adjusted Exercise Price.
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E = the current Exercise Price.
M = the current market price per share of Common Stock on
the record date mentioned below.
F = the aggregate fair market value on the record date of
the assets, securities, rights or warrants divided by
the number of outstanding shares of Common Stock on the
record date for such distribution. The Board of
Directors of the Company shall determine the fair market
value.
The adjustment shall be made successively whenever any such
distribution is made and shall become effective immediately after the record
date for the determination of stockholders entitled to receive the distribution.
Adjustment for Common Stock Issue:
If the Company issues shares of Common Stock for a
consideration per share less than the current market price per share on the date
the Company fixes the offering price of such additional shares, the Exercise
Price shall be adjusted in accordance with the formula:
P
---
E' = E x O + M
------------
A
where:
E' = the adjusted Exercise Price.
E = the then current Exercise Price.
O = the number of shares outstanding immediately prior to
the issuance of such additional shares.
P = the aggregate consideration received for the issuance of
such additional shares.
M = the current market price per share on the date of
issuance of such additional shares.
A = the number of shares outstanding immediately after the
issuance of such additional shares.
The adjustment shall be made successively whenever any such
issuance is made, and shall become effective immediately after such issuance.
This subsection (d) does not apply to:
any of the transactions described in subsections (b) and (c) of this Section 7,
the exercise of Warrants, or the conversion or exchange of other securities
convertible into, or exchangeable or exercisable for, Common Stock,
Common Stock issued to the Company's employees under bona fide employee benefit
plans adopted by the Board of Directors and approved by the holders of Common
Stock when required by law, if such Common Stock would otherwise be covered by
this subsection (d),
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Common Stock issued upon the exercise of rights or warrants issued to the
holders of Common Stock,
Common Stock issued to shareholders of any person which merges into the Company
in proportion to their stock holdings of such person immediately prior to such
merger, upon such merger,
Common Stock issued in a bona fide public offering pursuant to a firm commitment
underwriting,
Common Stock issued in a bona fide private placement to, or through a placement
agent which is, a member firm of the National Association of Securities Dealers,
Inc., or
Common Stock issued as a dividend on any preferred stock in accordance with the
stated terms of such preferred stock and in lieu of cash dividends otherwise
payable on such preferred stock pursuant to the instrument under which the
preferred stock was issued.
Adjustment for Convertible Securities Issue.
If the Company issues any securities convertible into or
exchangeable or exercisable for Common Stock (other than securities issued in
transactions described in subsections (b) and (c) of this Section 7) for a
consideration per share of Common Stock initially deliverable upon conversion or
exchange of such securities less than the current market price per share on the
date of issuance of such securities, the Exercise Price shall be adjusted in
accordance with this formula:
P
---
E' = E x O + M
----------
O + D
where:
E' = the adjusted Exercise Price.
E = the then current Exercise Price.
O = the number of shares outstanding immediately prior to
the issuance of such securities.
P = the aggregate consideration received for the issuance of
such securities.
M = the current market price per share of Common Stock on
the date of issuance of such securities.
D = the maximum number of shares deliverable upon conversion
or in exchange for such securities at the initial
conversion or exchange rate.
The adjustment shall be made successively whenever any such
issuance is made, and shall become effective immediately after such issuance.
If all of the Common Stock deliverable upon conversion or
exchange of such securities has not been issued when such securities are no
longer outstanding, then the Exercise
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Price shall promptly be readjusted to the Exercise Price which would then be in
effect had the adjustment upon the issuance of such securities been made on the
basis of the actual number of shares of Common Stock issued upon conversion or
exchange of such securities.
This subsection (e) does not apply to:
convertible securities issued to shareholders of any person which merges into
the Company, or with a subsidiary of the Company, in proportion to their stock
holdings of such person immediately prior to such merger, upon such merger,
convertible securities issued in a bona fide public offering pursuant to a firm
commitment underwriting,
convertible securities issued in a bona fide private placement through a
placement agent which is a member firm of the National Association of Securities
Dealers, Inc.,
rights, warrants and convertible and exchangeable securities outstanding on or
prior to the date of issuance of the Warrant, or
convertible securities or warrants issued in connection with the incurrence of
debt by the Company or any of its subsidiaries, so long as the fair value
allocable to such convertible securities or warrants (taking into account the
terms of the debt), together with any consideration payable to the Company upon
conversion or exercise of such convertible securities or warrants, treating such
convertible securities or warrants on an as converted basis, is no less than the
then current market price of Common Stock on the date of issuance of such
convertible securities or warrants.
Current Market Price.
Subject to the last two sentences of this subsection (f), in
subsections (b), (c), (d) and (e) of this Section 7, the current market price
per share of Common Stock on any date is the average of the Quoted Prices of the
Common Stock for 30 consecutive trading days commencing 45 trading days before
the date in question. The "Quoted Price" of the Common Stock is the last
reported sales price of the Common Stock as reported by NASDAQ National Market,
or if the Common Stock is listed on a securities exchange, the last reported
sales price of the Common Stock on such exchange which shall be for consolidated
trading if applicable to such exchange, or if neither so reported or listed, the
last reported bid price of the Common Stock. In the absence of one or more such
quotations (including, without limitation, during the period prior to the
Initial Public Offering), the Board of Directors of the Company shall determine
the current market price on the basis of such quotations, if available, or other
valuation information as it in good faith considers appropriate. In the event of
the Initial Public Offering, the current market price per share of Common Stock
shall be the Quoted Price on the day of such Initial Public Offering.
Consideration Received.
For purposes of any computation respecting consideration
received pursuant to subsections (d) and (e) of this Section 7, the following
shall apply:
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in the case of the issuance of shares of Common Stock for cash, the
consideration shall be the amount of such cash, provided that in no case shall
any deduction be made for any commissions, discounts or other expenses incurred
by the Company for any underwriting of the issue or otherwise in connection
therewith;
in the case of the issuance of shares of Common Stock for a consideration in
whole or in part other than cash, the consideration other than cash shall be
deemed to be the fair market value thereof as determined in good faith by the
Board of Directors (irrespective of the accounting treatment thereof), whose
determination shall be conclusive; and
in the case of the issuance of securities convertible into or exchangeable for
shares, the aggregate consideration received therefor shall be deemed to be the
consideration received by the Company for the issuance of such securities plus
the additional minimum consideration, if any, to be received by the Company upon
the conversion or exchange thereof (the consideration in each case to be
determined in the same manner as provided in clauses (1) and (2) of this
subsection).
When De Minimis Adjustment May Be Deferred.
No adjustment in the Exercise Price need be made unless the
adjustment would require on increase or decrease of at least 1% in the Exercise
Price. Any adjustments that are not made shall be carried forward and taken into
account in any subsequent adjustment.
All calculations under this Section shall be made to the
nearest cent or nearest 1/100th of a share as the case may be.
When No Adjustment Required.
No adjustment need be made for a transaction referred to in
subsection (a), (b), (c), (d) or (e) of this Section 7 if Warrant holders are
permitted to participate in the transaction (without being required to exercise
their Warrants in order to do so) on a basis and with notice that the Board of
Directors of the Company determines to be fair and appropriate in light of the
basis and notice on which holders of Common Stock participate in the
transaction.
No adjustment need be made for rights to purchase Common Stock
pursuant to a Company plan for reinvestment of dividends or interest.
No adjustment need be made for a change in the par value or no
par value of the Common Stock.
To the extent the Warrants become convertible into cash, no
adjustment need be made thereafter as to the cash. Interest will not accrue on
the cash.
Notice of Adjustment.
Whenever the Exercise Price is adjusted, the Company shall
provide the notices required by Section 9 hereof.
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Voluntary Reduction.
The Company from time to time may reduce the Exercise Price by
any amount for any period of time if the period is at least 20 days and if the
reduction is irrevocable during the period; provided, however, that in no event
may the Exercise Price be less than the par value of a share of Common Stock.
Whenever the Exercise Price is reduced, the Company shall mail
to Warrant holders a notice of the reduction. The Company shall mail the notice
at least 15 days before the date the reduced Exercise Price takes effect. The
notice shall state the reduced Exercise Price and the period it will be in
effect.
A reduction of the Exercise Price pursuant to this clause (k)
does not change or adjust the Exercise Price otherwise in effect for purposes of
subsections (a), (b), (c), (d) and (e) of this Section 7.
Reorganization of Company.
If the Company consolidates or merges with or into, or sells,
transfers or leases all or substantially all of its assets to, any person
(including, without limitation, in a transaction that is an Automatic Exercise
Event), upon consummation of such transaction the Warrants shall automatically
become exercisable (or, in the event of an Automatic Exercise Event, be
exercised) for the kind and amount of securities, cash or other assets which the
holder of a Warrant would have owned immediately after the consolidation,
merger, sale, transfer or lease if the holder had exercised the Warrant
immediately before the effective date of the transaction. Unless such
transaction shall have been an Automatic Exercise Event, concurrently with the
consummation of such transaction, the corporation formed by or surviving any
such consolidation or merger, if other than the Company, or the person to which
such transfer, sale or lease shall have been made, shall enter into a
supplemental Warrant Agreement so providing and further providing for
adjustments which shall be as nearly equivalent as may be practical to the
adjustments provided for in this Section. The successor Company shall mail to
warrant holders a notice describing the supplemental Warrant Agreement.
If the issuer of securities deliverable upon exercise of
Warrants under the supplemental Warrant Agreement is an affiliate of the formed,
surviving, transferee or lessee corporation, that issuer shall join in the
supplemental Warrant Agreement.
If this subsection (l) applies, subsections (a), (b), (c), (d)
and (e) of this Section 7 do not apply.
Determinations Conclusive.
Any determination that the Company or the Board of Directors
of the Company must make pursuant to subsection (a), (c), (d), (e), (f), (g) or
(i) of this Section 7 is conclusive, provided the Board of Directors has acted
reasonably.
13
When Issuance or Payment May Be Deferred.
In any case in which this Section 7 shall require that an
adjustment in the Exercise Price be made effective as of a record date for a
specified event, the Company may elect to defer until the occurrence of such
event (i) issuing to the holder of any Warrant exercised after such record date
the Warrant Shares and such securities or assets, if any, issuable upon such
exercise over and above the Warrant Shares and such securities or assets, if
any, issuable upon such exercise on the basis of the Exercise Price and (ii)
paying to such holder any amount in cash in lieu of a fractional share pursuant
to Section 8; provided, however, that the Company shall deliver to such holder a
due xxxx or other appropriate instrument evidencing such holder's right to
receive such additional warrant Shares, other capital stock and cash upon the
occurrence of the event requiring such adjustment.
Adjustment in Number of Shares.
Upon each adjustment of the Exercise Price pursuant to this
Section 7, each Warrant outstanding prior to the making of the adjustment in the
Exercise Price shall thereafter evidence the right to receive upon payment of
the adjusted Exercise Price that number of shares of Common Stock (calculated to
the nearest hundredth) obtained from the following formula:
N' = N x E
------
E'
where:
N' = the adjusted number of Warrant Shares issuable upon
exercise of a Warrant by payment of the adjusted
Exercise Price.
N = the number of Warrant Shares previously issuable upon
exercise of a Warrant by payment of the Exercise Price
prior to adjustment.
E' = the adjusted Exercise Price.
E = the Exercise Price prior to adjustment.
FRACTIONAL INTERESTS.
The Company shall not be required to issue fractional Warrant
Shares on the exercise of Warrants. If more than one Warrant shall be presented
for exercise in full at the same time by the same holder, the number of full
Warrant Shares which shall be issuable upon the exercise thereof shall be
computed on the basis of the aggregate number of Warrant Shares purchasable on
exercise of the Warrants so presented. If any fraction of a Warrant Share would,
except for the provisions of this Section 8 be issuable on the exercise of any
Warrants (or specified portion thereof), the Company shall pay an amount in cash
equal to the current Exercise Price, multiplied by such fraction.
NOTICES TO WARRANT HOLDERS.
Upon any adjustment of the Exercise Price pursuant to Section
7, the Company shall promptly thereafter cause to be given to each of the
registered holders of the Warrants at its
14
address appearing on the Warrant register written notice of such adjustment by
first-class mail, postage prepaid. Where appropriate, such notice may be given
in advance and included as a part of the notice required to be mailed under the
other provisions of this Section 7.
In case:
the Company shall authorize the issuance to all holders of
shares of Common Stock of rights, options or warrants to subscribe for or
purchase shares of Common Stock or of any other subscription rights or warrants;
or
the Company shall authorize the distribution to all holders of
shares of Common Stock of evidences of indebtedness or assets, including cash
dividends or cash distributions payable out of consolidated current or retained
earnings, but not including dividends payable in shares of Common Stock or
distributions referred to in subsection (a) of Section 7 hereof; or
of any consolidation or merger to which the Company is a party
and of which approval of any shareholders of the Company is required, or of the
conveyance, sale, transfer or lease of the properties and assets of the Company
substantially as an entirety, or of any reclassification or change of Common
Stock issuable upon exercise of the Warrants (other than a change in par value,
or from par value to no par value, or from no par value to par value, or as a
result of a subdivision or combination), or a tender offer or exchange offer for
shares of Common Stock; or
of the voluntary or involuntary dissolution, liquidation or
winding up of the Company; or
the Company proposes to take any action (other than actions of
the character described in Section 7(a)) that would require an adjustment of the
Exercise Price pursuant to Section 7;
then the Company shall cause to be given to each of the registered holders of
the Warrants at his address appearing on the Warrant register, at least 20 days
(or 10 days in any case specified in clause (a) or (b) above) prior to the
applicable record date hereinafter specified, or promptly in the case of events
for which there is no record date, by first-class mail, postage prepaid, a
written notice stating (i) the date as of which the holders of record of shares
of Common Stock to be entitled to receive any such rights, options, warrants or
distribution are to be determined, or (ii) the initial expiration date set forth
in any tender offer or exchange offer for shares of Common Stock, or (iii) the
date on which any such consolidation, merger, conveyance, transfer, dissolution,
liquidation or winding up is expected to become effective or consummated, and
the date as of which it is expected that holders of record of shares of Common
Stock shall be entitled to exchange such shares for securities or other
property, if any, deliverable upon such reclassification, consolidation, merger,
conveyance, sale, transfer, lease, dissolution, liquidation, winding up or other
action. The failure to give the notice required by this Section 9 or any defect
therein shall not affect the legality or validity of any distribution, right,
option, warrant, consolidation, merger, conveyance, transfer, dissolution,
liquidation or winding up, or the vote upon any action.
15
Nothing contained in this Agreement or in any of the Warrants
shall be construed as conferring upon the holders thereof the right to vote or
to consent or to receive notice as shareholders in respect of the meetings of
shareholders or the election of directors of the Company or any other matter or
any rights whatsoever as shareholders of the Company.
AMENDMENTS.
The terms of this Warrant Agreement and the Warrants may be
amended by the Company, and the observance of any term herein or therein may be
waived, but only with the written consent of the holders of Warrants
representing a majority in number of the total Warrant Shares at the time
purchasable upon the exercise of all then outstanding Warrants, provided that no
such action may change the Exercise Price (other than in accordance with Section
7(k) hereof) without the written consent of all holders of Warrants affected
thereby.
MISCELLANEOUS.
Issue Date. The provisions of this Warrant shall be construed
and shall be given effect in all respects as if it had been issued and delivered
by the Company on the date hereof.
Successors. This Warrant shall be binding upon any successors
or assigns of the Company.
Governing Law. This Warrant shall be governed by and
construed in accordance with the laws of the State of Delaware.
Office of the Company. So long as the Warrants remain
outstanding, the Company shall maintain an office where the Warrants may be
presented for exercise, transfer, division and combination. Such office shall be
at 000 Xxxxx Xxxxxxxxx Xxxxxxxxx, Xx Xxxxxxx, Xxxxxxxxxx 00000-0000, unless and
until the Company shall designate and maintain another office for such purposes,
in which case the Company shall deliver notice of such change to all holders of
outstanding Warrants in the manner set forth herein.
Headings. The headings used in this Warrant are used for
convenience only and are not to be considered in construing or interpreting this
agreement.
Notices. Unless otherwise provided, any notice required or
permitted under this Warrant shall be given in writing and shall be deemed
effectively given upon personal delivery to the party to be notified or three
days after being sent via air courier, in all cases addressed to the party to be
notified at the address indicated for such party on the signature page hereof,
or at such other address as such party may designate by ten days advance written
notice to the other party. Notwithstanding the foregoing, notice may be given by
telex or facsimile provided that appropriate confirmation of receipt is
received.
Saturdays, Sundays, Holidays. If the last or appointed day for
the taking of any action or the expiration of any right required or granted
herein shall be a Saturday or a Sunday or shall be a legal holiday in the State
of California, then such action may be taken or such right may be exercised on
the next succeeding day not a legal holiday.
16
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.
CBRE HOLDING, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
----------------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Secretary
FS EQUITY PARTNERS III, L.P.
By: FS Capital Partners, L.P.
Its: General Partner
By: FS Holdings, Inc.
Its: General Partner
By: /s/ Xxxxx X. Xxxxxxx
----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Chief Financial Officer
FS EQUITY PARTNERS INTERNATIONAL, L.P.
By: FS&Co. International, L.P.
Its: General Partner
By: FS International Holdings Limited
Its: General Partner
By: /s/ Xxxxx X. Xxxxxxx
----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
17
EXHIBIT A
[FORM OF WARRANT CERTIFICATE]
[FRONT]
EXERCISABLE ON OR AFTER AUGUST 26, 2007
AND ON OR BEFORE AUGUST 27, 2007
OR UPON AN AUTOMATIC EXERCISE EVENT
No. ___ _________ Warrants
WARRANT CERTIFICATE
CBRE HOLDING, INC.
This Warrant Certificate certifies that _____________________,
or registered assigns, is the registered holder of ___________________ Warrants
expiring ___________________ (the "Warrants") to purchase shares of Class B
Common Stock (the "Common Stock") of CBRE Holding, Inc. (the "Company"). Each
Warrant entitles the holder, (i) unless an Automatic Exercise Event shall occur
on or prior to August 27, 2007, upon exercise to receive from the Company on or
after August 26, 2007 and on or before 5:00 p.m. Los Angeles Time on August 27,
2007 one fully paid and nonassessable share of Common Stock (a "Warrant Share")
at the initial exercise price (the "Exercise Price") of $30.00, payable in
lawful money of the United States of America or in Warrant Shares by "cashless
exercise," upon surrender of this Warrant Certificate and payment of the
Exercise Price at the principal office of the Company, but only subject to the
conditions set forth herein and in the Warrant Agreement referred to on the
reverse hereof, or (ii) upon the occurrence of an Automatic Exercise Event on or
prior to August 27, 2007, to receive automatically from the Company a Warrant
Share at the Exercise Price, payable by "cashless exercise," upon surrender of
this Warrant Certificate and payment of the Exercise Price at the principal
office of the Company, but only subject to the conditions set forth herein and
in the Warrant Agreement referred to on the reverse hereof. The Exercise Price
and number of Warrant Shares issuable upon exercise of the Warrants are subject
to adjustment upon the occurrence of certain events set forth in the Warrant
Agreement.
Except in connection with an Automatic Exercise Event, no
warrant may be exercised before August 26, 2007 or after 5:00 PM, Los Angeles
time, on August 27, 2007 and to the extent not exercised by, or an Automatic
Exercise Event shall not have occurred by, such time, such Warrants shall become
void.
This Warrant Certificate shall be governed and construed in
accordance with the internal laws of the State of Delaware.
18
IN WITNESS WHEREOF, CBRE Holding, Inc. has caused this Warrant
Certificate to be signed by its President and by its Secretary, each by his
signature or a facsimile of his signature.
Dated:
--------------
By:
------------------------------------
President
By:
------------------------------------
Secretary
19
[FORM OF WARRANT CERTIFICATE]
[REVERSE]
The Warrants evidenced by this Warrant Certificate are part of
a duly authorized issue of Warrants expiring August 27, 2007 entitling the
holder on exercise to receive shares of Class B Common Stock, of the Company
(the "Common Stock"), $.01 par value, and are issued or to be issued pursuant to
a Warrant Agreement dated as of _________ ____, 2001 (the "Warrant Agreement"),
duly executed and delivered by the Company, which 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 of 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. A copy of the Warrant Agreement may be obtained by the holder
hereof upon written request to the Company.
Unless an Automatic Exercise Event shall occur on or prior to
August 27, 2007, warrants may be exercised at any time on or after August 26,
2007 and on or before August 27, 2007. The holder of Warrants evidenced by this
Warrant Certificate may exercise them, subject to the limitations set forth in
the Warrant Agreement, by surrendering this Warrant Certificate, with the form
of election to purchase set forth hereon properly completed and executed,
together with payment of the Exercise Price in cash or immediately available
funds or in Warrant Shares by "cashless exercise," at the principal office of
the Company. In the event that upon any exercise of Warrants evidenced hereby
the number of Warrants exercised shall be less than the total number of Warrants
evidenced hereby, there shall be issued to the holder hereof or his assignee a
new Warrant Certificate evidencing the number of Warrants not exercised.
Upon the occurrence of an Automatic Exercise Event on or prior
to August 27, 2007, the Warrants evidenced by this Warrant Certificate shall
automatically be exercised, subject to the limitations set forth in the Warrant
Agreement, and the holder thereof shall be entitled to receive, upon
surrendering this Warrant Certificate, together with payment of the Exercise
Price in Warrant Shares by "cashless exercise," at the principal office of the
Company, the number of Warrant Shares resulting after subtracting such Exercise
Price.
The Warrant Agreement provides that upon the occurrence of
certain events the Exercise Price and the number of Warrant Shares into which
this Warrant is exercisable set forth on the face hereof may, subject to certain
conditions, be adjusted. No fractions of a share of Common stock will be issued
upon the exercise of any Warrant, but the Company will pay the cash value
thereof determined as provided in the Warrant Agreement. No adjustment shall be
made for any dividends on any Common Stock issuable upon exercise of this
Warrant.
Warrant Certificates, where surrendered at the principal
office of the Company by the registered holder thereof in person or by legal
representative or attorney duly authorized in writing, may be exchanged, in the
manner and subject to the limitations provided in the Warrant Agreement, but
without payment of any service charge, for another Warrant Certificate or
Warrant Certificates of like tenor evidencing in the aggregate a like number of
Warrants.
20
Upon due presentation for registration of transfer of this
Warrant Certificate at the principal office 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 transferee(s) in
exchange for this Warrant Certificate, subject to the limitations provided in
the Warrant Agreement (including, without limitation, delivery to the Company of
the written agreement of such transferee(s) to become party to the
Securityholders' Agreement, dated as of _______ ___, 2001, by and among the
Company and the other parties thereto, if such transferee(s) are not already
party thereto, prior to receipt from the Company of any Warrant Shares as a
result of the exercise of the Warrants represented by such Warrant Certificate),
without charge except for any tax or other governmental charge imposed in
connection therewith.
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, of any distribution to the holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary. Neither the Warrants nor this Warrant Certificate entitle any holder
hereof to any rights of a stockholder of the Company.
21
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CUSIP No. 00000X000 13D Page 340 of 340
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ELECTION TO PURCHASE
(TO BE EXECUTED UPON EXERCISE OF WARRANT PURSUANT TO SECTION 1)
The undersigned hereby irrevocably elects to exercise the
right represented by this Warrant, to receive __________ shares of Class B
Common Stock and hereby tenders payment for such shares [to the order of XXXX XX
Holding Corp. by cash or immediately available funds in the amount of $ _______]
[by delivery to the Company of __________ Warrant Shares with respect to which
this Warrant is being surrendered in payment of the aggregate Exercise Price for
the Warrant Shares to be delivered to the holder] in accordance with the terms
hereof. The undersigned requests that a certificate for such shares be
registered in the name of __________________, whose address is ________________.
If said number of shares is less than all of the shares of Common Stock
purchasable hereunder, the undersigned requests that a new Warrant representing
the remaining balance of such shares be registered in the name
of____________________, whose address is ______________________, and that such
Warrant be delivered to __________________, whose address
is____________________.
Date:
---------------------------------------
--------------------------------------------
Print Name
--------------------------------------------
Signature Guaranteed*
-----------------------
* The signature must be guaranteed by a bank or trust company having an office
in Los Angeles, California, or by a firm having membership on the New York
Stock Exchange.
