EXHIBIT 99.2
THIS WARRANT WAS ORIGINALLY ISSUED ON MARCH 15, 1994 AND SUCH ISSUANCE WAS NOT
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). THIS
WARRANT MAY NOT BE TRANSFERRED IN VIOLATION OF SECTION 6 HEREOF. THIS WARRANT
MAY ONLY BE TRANSFERRED IF REGISTERED UNDER THE ACT UNLESS, IN THE OPINION OF
COUNSEL REASONABLY ACCEPTABLE TO THE COMPANY, SUCH REGISTRATION IS UNNECESSARY
FOR SUCH TRANSFER TO COMPLY WITH THE ACT.
ANGELES PARTICIPATING MORTGAGE TRUST
CLASS B SHARE PURCHASE WARRANT
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Date of Issuance: March 15, 1994 Certificate No. W-002
FOR VALUE RECEIVED, Angeles Participating Mortgage Trust, a California
business trust (the "Company"), hereby grants to SAHI, Inc., a Delaware
corporation, or any transferee permitted by Section 6 hereof (the "Holder") the
right to purchase from the Company up to 2,500,000 shares of the Company's Class
B Shares (the "Class B Shares") at a price per share of $.01 (the "Exercise
Price"); provided, however, the Holder may only exercise this Warrant
contemporaneous with the exercise of the Company's Class A Warrant originally
issued to SAHI Partners on March 15, 1994 (the "Class A Warrant") and only with
respect to a number of Class B Shares equal to fifty percent of the number of
Class A Shares purchased pursuant to the exercise of the Class A Warrant.
This Warrant is subject to the following provisions:
Section 1. Exercise of Warrant.
1A. Exercise Period. The Holder may exercise, in whole or in part
(but not as to a fractional Class B Share), the purchase rights represented by
this Warrant contemporaneous with the exercise of the Company's Class A Warrant;
provided, however, that the purchase rights represented by this Warrant (i) may
be exercised only if the shareholders of the Company shall have approved the
issuance of this Warrant and the issuance of any Class B Shares hereunder (the
"Approval") at the next annual shareholders meeting of the Company occurring
after the date hereof (the "Annual Meeting") and (ii) must be exercised, if at
all, on or before that date which is 120 days subsequent to the date of the
Annual Meeting.
1B. Exercise Procedure.
(i) This Warrant shall be deemed to have been exercised when the
Company has received all of the following items (the "Exercise Time"):
(a) a completed Exercise Agreement, as described in paragraph 1C
below and substantially in the form set forth in Exhibit I hereto, executed
by the
Person exercising all or any part of the purchase rights represented by
this Warrant (the "Purchaser");
(b) this Warrant;
(c) if this Warrant is not registered in the name of the Purchaser,
an Assignment or Assignments in the form set forth in Exhibit II hereto
evidencing the assignment of this Warrant to the Purchaser, in which case
the Holder shall have complied with the provisions set forth in Section 6
and Section 7 hereof;
(d) a check payable to the Company or wire transfer of immediately
available funds to an account designated by the Company in an amount equal
to the product of the number of Class B Shares being purchased upon such
exercise multiplied by the Exercise Price (the "Aggregate Exercise Price");
(e) at the Company's option, the opinion described in Section 10
below; and
(f) all of the deliveries necessary for the exercise of the Class A
Warrant.
(ii) Certificates for Class B Shares purchased upon exercise of this
Warrant shall be delivered by the Company to the Purchaser within five business
days after the date of the Exercise Time. Unless this Warrant has expired or all
of the purchase rights represented hereby have been exercised, the Company shall
prepare a new Warrant, substantially identical hereto, representing the rights
formerly represented by this Warrant which have not expired or been exercised
and shall within such five-day period, deliver such new warrant to the Holder.
(iii) The Class B Shares issuable upon the exercise of this Warrant
shall be deemed to have been issued to the Purchaser at the Exercise Time, and
the Purchaser shall be deemed for all purposes to have become the record holder
of such Class B Shares at the Exercise Time.
(iv) The issuance of certificates for Class B Shares upon exercise
of this Warrant shall be made without charge to the Holder or the Purchaser for
costs incurred by the Company in connection with such exercise and the related
issuance of Class B Shares. Each Class B Share issuable upon exercise of this
Warrant shall upon payment of the Exercise Price therefor, be fully paid and
nonassessable and free from all taxes, liens and charges with respect to the
issuance thereof.
(v) The Company shall not close its books against the transfer of
this Warrant or of any Class B Shares issued or issuable upon the exercise of
this Warrant in any manner which interferes with the timely exercise of this
Warrant. The Company shall from time to time take all such action as may be
necessary to assure that the par value per share of the unissued Class B Shares
acquirable upon exercise of this Warrant is at all times equal to or less than
the Exercise Price.
(vi) The Company shall assist and cooperate with the Holder or any
Purchaser required to make any governmental filings or obtain any governmental
approvals prior to or in connection with any exercise of this Warrant
(including, without limitation, making any filings required to be made by the
Company).
(vii) The Company shall take all such actions as may be necessary to
assure that all such Class B Shares may be so issued without violation of any
applicable law or governmental regulation or any requirements of any domestic
securities exchange upon which Class B Shares may be listed (except for official
notice of issuance which shall be immediately delivered by the Company upon each
such issuance); and
(viii) Upon the exercise of this Warrant, the Class B Shares shall
only be issued in the name of SAHI, Inc. or a transferee permitted by Section 6
hereof.
1C. Exercise Agreement. Upon any exercise of this Warrant, the
Exercise Agreement substantially in the form set forth in Exhibit I hereto shall
be executed by the Purchaser or transferee permitted by Section 6 hereof. Such
Exercise Agreement shall be dated the actual date of execution thereof.
Section 2. Liquidation Dividends. If the Company declares or pays a
dividend upon the Class B Shares payable otherwise than in cash out of earnings
or earned surplus (determined in accordance with generally accepted accounting
principles, consistently applied) except for a share dividend payable in Class B
Shares (a "Liquidating Dividend"), then the Company shall pay to the Holder at
the time of payment thereof the Liquidating Dividend which would have been paid
to such Holder on the Class B Shares had this Warrant been fully exercised
immediately prior to the date on which a record is taken for such Liquidating
Dividend, or, if no record is taken, the date as of which the record holders of
Class B Shares entitled to such dividends are to be determined.
Section 3. Purchase Rights. If at any time the Company grants, issues
or sells any Options, Convertible Securities or rights to purchase stock,
shares, warrants, securities or other property pro rata to the record holders of
any class of its shares (the "Purchase Rights"), then the Holder shall be
entitled to acquire, upon the terms applicable to such Purchase Rights, the
aggregate Purchase Rights which Holder could have acquired if Holder had held
the number of Class B Shares acquirable upon complete exercise of this Warrant
immediately before the date on which a record is taken for the grant, issuance
or sale of such Purchase Rights, or, if no such record is taken, the date as of
which the record holders of Class B Shares are to be determined for the grant,
issue or sale of such Purchase Rights.
Section 4. Definitions. The following terms have meanings set forth
below:
"Convertible Securities" means any stock, shares or securities
(directly or indirectly) convertible into or exchangeable or exercisable for
Class B Shares.
"Options" means any rights or options to subscribe for or purchase
Class B Shares or Convertible Securities.
3
"Person" means an individual, a partnership, a joint venture, a
corporation, a limited liability company, a trust, an unincorporated
organization and a government or any department or agency thereof.
Section 5. No Voting Rights: Limitations of Liability. This Warrant
shall not entitle the holder hereof to any voting rights or other rights as a
shareholder of the Company. No provision hereof, in the absence of affirmative
action by the Holder to purchase Class B Shares, and no enumeration herein of
the rights or privileges of the Holder shall give rise to any liability of such
Holder for the Exercise Price of Class B Shares acquirable by exercise hereof or
as a shareholder of the Company.
Section 6. Warrant Transferability. This warrant and all rights
hereunder are not transferable, in while or in part, without the Company's prior
written consent, which consent shall not be unreasonably withheld or delayed as
to any transfer to an affiliate of SAHI Partners. Upon such consent, any
transfer of this Warrant, in whole or in part, shall be effected upon surrender
of this Warrant with a properly executed Assignment (in the form of Exhibit II
hereto) at the principal office of the Company. Each transferee of all or any
part of this Warrant, by taking and holding the same, consents to and agrees to
be bound by the provisions of this Warrant.
Section 7. Warrant Exchangeable for Different Denominations. This
Warrant is exchangeable, upon the surrender hereof by the Holder at the
principal office of the Company, for new Warrants of like tenor representing in
the aggregate the purchase rights hereunder, and each of such new Warrants shall
represent such portion of such rights as is designated by the Holder at the time
of such surrender. The date the company initially issues this Warrant shall be
deemed to be the "Date of Issuance" hereof regardless of the number of times new
certificates representing the unexpired and exercised rights formerly
represented by this Warrant shall be issued. All Warrants representing portions
of the rights hereunder are referred to herein as the "Warrants."
Section 8. Consideration. The consideration received by the Company
for this Warrant is the sum of $1,000 cash, receipt of which is hereby
acknowledged by the Company, which amount will be applied against the first
$1,000 of the Aggregate Exercise Price for Class B Shares purchased pursuant
hereto. If the Approval is not received at the Annual Meeting, the Company
shall promtly refund to the Holder the consideration described in this Section
8 and, following such remittance, this Warrant shall be of no further force and
effect. Any new Warrants issued pursuant hereto shall not require the payment of
any additional consideration.
Section 9. Pre-Exercise Covenants of the Company. The Company, acting
through its trustees, shall, in accordance with applicable law:
(i) duly call, give notice of, convene and hold the Annual Meeting
as soon as practicable following the date hereof. At such Annual Meeting the
Company will submit to its shareholders a proposal relating to the issuance of
this Warrant and the Class B Shares exercisable hereunder for their approval;
and
(ii) include in the proxy statement distributed to shareholders prior
to the Annual Meeting the recommendation of the trustees that the shareholders
of the Company vote to approve the proposal relating to the issuance of this
Warrant and the Class B Shares exercisable hereunder, unless the trustees shall
have determined in good faith that such recommendation could reasonably be
expected to be a breach of the trustees' fiduciary duties under applicable law.
Section 10. Fairness Opinion. The Company shall have the right, as a
condition to the first issuance of any Class B Shares pursuant to this Warrant,
to obtain an opinion from a qualified, independent third party which may include
the Company's outside auditors (the "Appraiser") as to the fairness of the terms
and provisions of this Warrant to the Company and its shareholders. In such
circumstance, if the Appraiser, for any reason, is unable to issue an opinion
that the terms and provisions of this Warrant are fair to the Company and its
stockholders, then the consideration described in Section 8 hereof shall be
promptly returned to the Holder and, following such remittance, this Warrant
shall terminate and be of no further force and effect. The cost to obtain such
opinion shall be shared equally by the Company and the Holder; provided,
however, that the Holder shall not be obligated to pay more than $25,000 toward
the aggregate cost of obtaining such opinion and any opinion regarding the Class
A Warrant.
Section 11. Representations of the Company. The Company hereby
represents and warrants that (i) this Warrant and the issuance of Class B Shares
upon exercise hereof have been unanimously approved by the Company's trustees
subject only to obtaining the Approval and (ii) neither the authorization or
issuance of this Warrant, nor the issuance of the Class B Shares upon the
exercise thereof, violates the Company's Declaration of Trust or any other
document, agreement, statute, rule, regulation, judgement, decree or order to
which the Company or any of its assets or properties is subject.
Section 12. Share Legends. Each certificate issued for Class B
Shares pursuant hereto or issued in exchange or substitution for any
certificates so issued shall bear the following legend, unless at the time of
issuance of the certificate the shares represented by such certificate are
registered under the Securities Act of 1933, as amended (the "Act") or the
Company has been provided with an opinion of counsel which shall be reasonably
satisfactory in form and substance to the Company, to the effect that the Class
B Shares are no longer restricted securities under the Act:
The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended, and
they may not be sold or offered for sale in the absence of an
effective registration statement under that Act as to said
securities or an opinion, in form and substance satisfactory
to the Company and given by counsel satisfactory to the Company,
that such registration is not required. The securities which are
evidenced by this Certificate were purchased under a warrant
dated March 15, 1994 issued by the Company and are benefitted
by and subject to the terms and conditions of such warrant.
Section 13. Replacement. Upon receipt of evidence reasonably
satisfactory to the Company (an affidavit of the Holder shall be satisfactory)
of the ownership
and the loss, theft, destruction or mutilation of any certificate evidencing
this Warrant, and in the case of any such loss, theft or destruction, upon
receipt of indemnity reasonably satisfactory to the Company (provided that if
the holder is a financial institution or other institutional investor its own
agreement shall be satisfactory), or, in the case of any such mutilation upon
surrender of such certificate, the Company shall (at its expense) execute and
deliver in lieu of such certificate a new certificate of like kind representing
the same rights represented by such lost, stolen, destroyed or mutilated
certificate and dated the date of such lost, stolen, detroyed or mutilated
certificate.
Section 14. Notices. Except as otherwise expressly provided herein,
all notices referred to in this Warrant shall be in writing and shall be
delivered personally, sent by reputable overnight courier service charges
prepaid) or sent by registered or certified mail, return receipt requested,
postage prepaid and shall be deemed to have been given when so delivered, sent
or three days after being deposited in the U.S. Mail (i) to the Company, at its
principal executive offices and (ii) to the Holder, at the Holder's address as
it appears in the records of the Company (unless otherwise indicated by the
Holder).
Section 15. Amendment and Waiver. Except as otherwise provided herein,
the provisions of this Warrant may be amended and the Company may take any
action herein prohibited, or omit to perform any act herein required to be
performed by it, only if the Company has obtained the written consent of the
Holders of Warrants representing a majority of the Class B Shares obtainable
upon exercise of this Warrant.
Section 16. Descriptive Headings; Governing Law. All questions
concerning the construction, validity, enforcement and interpretation of this
Warrant shall be governed by the internal law of the State of California,
without giving effect to any choice of law or conflict of law provision or rule
(whether of the State of California or any other jurisdictions) that would cause
the application of the laws of any jurisdictions other than the State of
California.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed
and attested by its duly authorized officers under its seal and to be dated as
of the date of issuance hereof.
ANGELES PARTICIPATING MORTGAGE
TRUST
By:/s/ Xxxxxx X. Xxxxxxxxx
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Its: President
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[Trust Seal]
Attest:
/s/ Xxx Xxxxxxxxxx
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Title: Secretary
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EXHIBIT I
EXERCISE AGREEMENT
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To:___________________________ Dated:___________________________
The undersigned, pursuant to the provisions set forth in the attached
Warrant (Certificate No. W-_________), hereby agrees to subscribe for and
purchase _________ Class B Shares covered by such Warrant and makes payment
herewith in full therefor at the price per share provided by such Warrant.
The undersigned is acquiring such Class B Shares for its own account, for
investment purposes only, and not with a view towards the sale or other
distribution thereof, in whole or in part. The undersigned understands that the
Class B Shares issued pursuant to the Warrant have not been registered under the
Securities Act of 1933, as amended.
Signature: ________________________________
Address: ________________________________
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EXHIBIT II
ASSIGNMENT
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FOR VALUE RECEIVED, _______________________________ hereby sells, assigns
and transfers all of the rights of the undersigned under the attached Warrant
(Certificate No. W-__________) with respect to the number of shares of the Class
B Shares covered thereby set forth below, unto:
Names of Assignee Address No. of Shares
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Dated:________________________ Signature: ________________________________
Address: ________________________________
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