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Exhibit 4.1
WARRANT AGREEMENT
This WARRANT AGREEMENT dated as of June 15, 1999, between HOMEPLACE OF
AMERICA, INC., a Delaware corporation (the "Company"), and FIRST UNION NATIONAL
BANK, a national banking association (the "Warrant Agent").
Capitalized terms used and not otherwise defined herein shall have the
meanings assigned to them in the Plan of Reorganization defined below.
Pursuant to Section 6.2 of the First Amended Joint Plan of
Reorganization of the Homeplace Group (as defined therein) under Chapter 11 of
the Bankruptcy Code dated April 28, 1999, as the same may have been amended or
supplemented from time to time prior to the date hereof and has been approved
by the United States Bankruptcy Court for the District of Delaware (the "Plan
of Reorganization"), the Company is obligated, subject to the restrictions set
forth in Sections 5.2.7, 5.2.8, 5.2.9 and 6.2.2(b) of the Plan of
Reorganization, to issue the following stock purchase warrants to (a) the
holders of Allowed Class 7A Equity Interests, Allowed Class 7B Equity Interests
and Allowed Class 7C Equity Interests their respective Ratable Proportions of
warrants to purchase an aggregate amount of 1,250,000 shares of the Company's
Common Stock, $0.001 par value (hereinafter called the "Common Stock") (the
"Series A Warrants") and (b) the Waccamaw Shareholder warrants to purchase an
aggregate amount of 600,000 shares of the Company's Common Stock (hereinafter
called the " Series B Warrants" and together with the Series A Warrants, the
"Warrants").
The Warrant Agent, at the request of the Company, has agreed to act as
the agent of the Company in connection with the issuance, registration,
transfer, exchange and exercise of Warrants.
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NOW THEREFORE, in consideration of the premises and mutual agreements
herein set forth:
SECTION 1. Appointment of Warrant Agent. The Company hereby appoints
the Warrant Agent to act as agent for the Company in accordance with the
instructions hereinafter set forth, and the Warrant Agent hereby accepts such
appointment.
SECTION 2. Form of Warrant Certificates. The certificates evidencing
the Series A Warrants (the " Series A Warrant Certificates") (and the forms of
election to purchase shares and of assignment to be printed on the reverse
thereof) shall be substantially as set forth in Exhibit A hereto and the
certificates evidencing the Series B Warrants (the "Series B Warrant
Certificates" and together with the Series A Warrant Certificates, the "Warrant
Certificates") (and the forms of election to purchase shares and of assignment
to be printed on the reverse thereof) shall be substantially as set forth in
Exhibit B hereto. The Warrant Certificates may have such letters, numbers or
other marks of identification or designation or such legends, summaries or
endorsements printed, lithographed or engraved thereon as the Company may deem
appropriate and as are not inconsistent with the provisions of this Warrant
Agreement or as may be required to comply with any law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any stock
exchange on which the Warrants may from time to time be listed, or to conform
to usage. Each Warrant Certificate shall be dated as of the date of issuance
thereof by or on behalf of the Company, whether upon initial issuance or upon
transfer or exchange, and each Warrant initially shall entitle the holder
thereof to purchase an aggregate of one share of Common Stock at the applicable
Exercise Price, but the number of such shares and the Series A Exercise Price
and the Series B Exercise Price (each as defined in Section 6) shall be subject
to adjustments as provided
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herein.
SECTION 3. Countersignature and Registration. (a) The Warrant Agent,
upon receipt of written instructions provided by the Chairman of the Board of
Directors, the Chief Executive Officer, the President or the Secretary of the
Company and Warrant Certificates executed on behalf of the Company, shall
countersign and deliver, subject to the restrictions set forth in Sections
5.2.7, 5.2.8, 5.2.9 and 6.2.2(b) of the Plan of Reorganization, (a) Series A
Warrant Certificates to holders of Allowed Class 7A Equity Interests, Allowed
Class 7B Equity Interests and Allowed Class 7C Equity Interests pursuant to the
Reorganization Trust Agreement dated as of June 15, 1999, and (b) Series B
Warrant Certificates to the Waccamaw Shareholder.
(b) The Warrant Certificates shall be executed on behalf of the
Company by the Chairman of the Board, the Chief Executive Officer or the
President, by facsimile signature, and have affixed thereto a facsimile of the
Company's seal which shall be attested by the Secretary or an Assistant
Secretary of the Company by facsimile signature. The Warrant Certificates shall
be manually countersigned by the Warrant Agent and shall not be valid for any
purpose unless so countersigned. In the event that any officer of the Company
who shall have signed any of the Warrant Certificates shall cease to be such
officer of the Company before countersignature by the Warrant Agent and
issuance and delivery by the Company, such Warrant Certificates, nevertheless,
may be countersigned by the Warrant Agent, issued and delivered with the same
force and effect as though the person who signed such Warrant Certificates had
not ceased to be such officer of the Company; and any Warrant Certificates may
be signed on behalf of the Company by any person who, at the actual date of the
execution of such Warrant Certificates, shall be a proper officer of the
Company to sign such Warrant Certificates, although at the date of the execution
of this Warrant
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Agreement any such person was not such an officer.
(c) The Warrant Agent will keep or cause to be kept, at its office
in Charlotte, North Carolina, books for registration and transfer of the
Warrant Certificates issued hereunder. Such books shall show the names and
addresses of the respective holders of the Warrant Certificates, the number of
Warrants evidenced on its face by each of the Warrant Certificates and the date
of each of the Warrant Certificates.
(d) Prior to due presentment for registration of transfer of the
Warrant Certificates, the Company and the Warrant Agent may deem and treat the
registered holder thereof as the absolute owner of the Warrant Certificates
(notwithstanding any notation of ownership or other writing thereon made by
anyone other than the Company or the Warrant Agent) for the purpose of any
exercise thereof and of any distribution to the holder thereof and for all
other purposes.
(e) The Warrant Agent shall countersign a Warrant Certificate
only (i) upon initial issuance of the Warrants in accordance with written
instructions as provided in subsection (a) hereof or (ii) upon exchange,
transfer or substitution for one or more previously countersigned Warrant
Certificates as hereinafter provided.
SECTION 4. Transfer and Exchange. Subject to Section 6 hereof, the
Warrant Agent shall, from time to time, register the transfer of any
outstanding Warrant Certificate upon the books to be maintained by the Warrant
Agent for that purpose, upon surrender thereof for transfer properly endorsed
or accompanied by appropriate instruments of transfer and written instructions
for transfer, duly signed by the registered holder or holders thereof or by the
duly appointed legal representative thereof or by a duly authorized attorney,
such signature to be guaranteed by a commercial bank or trust company having an
office in the United States, by a broker or dealer that is a member of the
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National Association of Securities Dealers, Inc., or by a member of a national
securities exchange. Upon any such registration of transfer, a new Warrant
Certificate shall be issued to the transferee and the surrendered Warrant
Certificate shall be canceled by the Warrant Agent. After the date of this
Agreement, any Warrant Certificate may be exchanged at the option of the holder
thereof, upon surrender at the office or agency of the Warrant Agent maintained
for that purpose in the City of Charlotte in the State of North Carolina (the
"Warrant Agent Office"), for another Warrant Certificate, or other Warrant
Certificates of different denominations, representing in the aggregate the
right to purchase a like number of shares of Common Stock, and the surrendered
Warrant Certificate shall be canceled by the Warrant Agent. No fractional
Warrant Certificates will be issued. The Company may require from the
transferor payment of a sum sufficient to cover any tax or governmental charge
that may be imposed in connection with any transfer or exchange of Warrant
Certificates and shall notify the Warrant Agent of any applicable amounts
payable hereunder.
SECTION 5. Common Stock and Warrant Common Stock. As hereinafter used
in this Agreement, Common Stock shall mean the Common Stock, $0.001 par value,
of the Company as authorized at the date hereof and stock of any other class
into which such presently authorized Common Stock may hereafter be changed, and
"Warrant Common Stock" shall mean the Common Stock issuable upon exercise of
Warrants. In case, by reason of the operation of Section 7, the Warrants shall
entitle the registered holders thereof to purchase any other shares of stock or
other securities or property of the Company or of any other corporation, any
reference in this Agreement to the exercise of Warrants shall be deemed to
refer to and include the purchase of such other shares of stock or other
securities or property upon such exercise.
SECTION 6. Exercise Price of Warrants. (a) The registered holder of
any Series A
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Warrant Certificate may exercise the Series A Warrants evidenced thereby, in
whole or in part and in accordance with the provisions of Section 8, at any
time during the period commencing on the date hereof and ending at or prior to
5:00 p.m. (New York City time) on June 15, 2004, upon surrender of the Series A
Warrant Certificate with the form of election to purchase on the reverse side
thereof duly executed, to the Warrant Agent at the Warrant Agent Office,
together with payment of the purchase price for each share of Common Stock as
to which the Series A Warrants are exercised. As to any Series A Warrants which
have not been duly exercised at or prior to 5:00 p.m. (New York City time) on
June 15, 2004, all rights evidenced by the Series A Warrant Certificates shall
cease and the Series A Warrants shall become void.
(b) The registered holder of any Series B Warrant Certificate may
exercise the Series B Warrants evidenced thereby, in whole or in part and in
accordance with the provisions of Section 8, at any time during the period
commencing on the date hereof and ending at or prior to 5:00 p.m. (New York
City time) on January 15, 2001, upon surrender of the Series B Warrant
Certificate with the form of election to purchase on the reverse side thereof
duly executed, to the Warrant Agent at the Warrant Agent Office, together with
payment of the purchase price for each share of Common Stock as to which the
Series B Warrants are exercised. As to any Series B Warrants which have not
been duly exercised at or prior to 5:00 p.m. (New York City time) on January
15, 2001, all rights evidenced by the Series B Warrant Certificates shall cease
and the Series B Warrants shall become void.
(c) The purchase price for each share of Common Stock pursuant to
the exercise of a Series A Warrant (the "Series A Exercise Price") shall
initially be $14.00. The purchase price for each share of Common Stock pursuant
to the exercise of a Series B Warrant (the "Series B Exercise
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Price" and together with the Series A Exercise Price, the "Exercise Prices")
shall initially be $12.00. Each of the Exercise Prices shall be subject to
adjustment as provided in Section 7 hereof and shall be payable in lawful money
of the United States of America.
SECTION 7. Warrant Adjustments. Each of the Exercise Prices and the
number of shares purchasable upon exercise of each respective Warrant shall be
subject to adjustment as follows:
(a) Stock Dividends, Subdivisions, Combinations and
Reclassifications. In case the Company shall at any time after the date of this
Agreement (i) declare a dividend on the Common Stock payable in shares of
Common Stock, (ii) subdivide or reclassify the outstanding Common Stock or
(iii) combine or reclassify the outstanding Common Stock into a smaller number
of shares, each of the Exercise Prices in effect on the record date for such
dividend or on the effective date of such subdivision, combination or
reclassification shall be adjusted by multiplying each such Exercise Price by a
fraction, the numerator of which is the number of shares of Common Stock
outstanding immediately prior to such event and the denominator of which is the
number of shares of Common Stock outstanding immediately after such event. Such
adjustment shall be made successively immediately after the record date, in the
case of a dividend or distribution, or on the effective date, in the case of a
subdivision, combination or reclassification. In connection with any such
adjustment, the number of shares of Common Stock issuable upon exercise of the
Warrants also shall be simultaneously adjusted by multiplying such Exercise
Price in effect immediately prior to the adjustment required by the first
sentence of this paragraph by the number of shares of Common Stock issuable
upon the exercise of such Warrant immediately prior to the adjustment required
by the first sentence of this paragraph, and dividing the product so obtained
by each such adjusted Exercise Price after giving effect to the adjustment
required by the first sentence of this paragraph.
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(b) Subscriptions. If at any time after the date of this Agreement
the Company shall fix a record date for the issuance of rights or warrants to
all holders of its Common Stock entitling them (for a period expiring within 45
days after such record date) to subscribe for or to purchase shares of Common
Stock (or securities convertible into shares of Common Stock) at a price per
share, or having a conversion price per share of Common Stock (if a security is
convertible into Common Stock), that is less than the Series A Exercise Price
or the Series B Exercise Price per share of Common Stock on such record date,
as the case may be, then, where applicable, the relevant Exercise Price shall
be decreased to an amount determined by multiplying such Exercise Price in
effect immediately prior to such record date by a fraction, the numerator of
which is the sum of (x) the total number of shares of Common Stock outstanding
on such record date and (y) the number of shares of Common Stock which the
aggregate offering price of the total number of shares of Common Stock to be so
offered (or the aggregate initial conversion price of the convertible
securities to be so offered plus any subscription or purchase price of such
Securities) would purchase at such Exercise Price and the denominator of which
shall be the sum of (a) the number of shares of Common Stock outstanding on
such record date and (b) the number of additional shares of Common Stock to be
offered for subscription or purchase (or into which the convertible securities
to be so offered are initially convertible). In the event such subscription or
purchase price is paid, in whole or in part, with consideration other than
cash, the value of such consideration shall be as determined by the Board of
Directors of the Company, whose determination shall be conclusive and described
in a statement filed with the Warrant Agent. The number of shares purchasable
upon the exercise of each Warrant on such record date shall be increased to a
number of shares equal to (i) the number of shares purchasable on such record
date multiplied by the relevant Exercise Price in effect
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immediately prior to the adjustment required by the preceding sentence, divided
by (ii) the relevant adjusted Exercise Price computed pursuant to the preceding
sentence. Such adjustment shall be made successively whenever such a record
date is fixed and, in the event that such rights or warrants are not issued,
the relevant Exercise Price and the number of shares of Common Stock
purchasable upon exercise of such Warrants shall be readjusted to the price and
the number of shares which were in effect prior to such record date.
(c) Distributions. If at any time after the date hereof the
Company shall fix a record date for the making of a distribution to all holders
of its Common Stock of evidences of its indebtedness or assets (excluding cash
distributions made as a dividend payable out of earnings or out of surplus
legally available for dividends under the laws of the jurisdiction of the
Company), securities convertible into Common Stock or rights to subscribe for
Common Stock (excluding those referred to in subsection (b) above), then in
each case, the applicable Exercise Price in effect immediately prior to such
record date shall be decreased to an amount determined by multiplying such
Exercise Price by a fraction, the numerator of which is such Exercise Price on
such record date less the fair market value calculated on a per share Common
Stock basis (as determined by the Board of Directors of the Company, whose
determination shall be conclusive and described in a statement filed with the
Warrant Agent) of the assets or evidences of indebtedness so distributed or of
such subscription rights, and the denominator of which is the relevant Exercise
Price on such date. The number of shares purchasable upon the exercise of each
Warrant on such record date shall be increased to a number of shares equal to
(i) the number of shares purchasable on such record date multiplied by the
relevant Exercise Price in effect immediately prior to the adjustment required
by the preceding sentence, divided by (ii) the adjusted relevant Exercise Price
computed pursuant to the
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preceding sentence. Such adjustments shall be made successively whenever such a
record date is fixed and, in the event that such distribution is not so made,
the relevant Exercise Price and the number of shares of Common Stock
purchasable upon exercise of such Warrants shall be adjusted to the price and
the number of shares which were in effect prior to such record date.
(d) Consolidation, Merger or Sale of Assets. In case the Company
shall be a party to any transaction after the date of this Warrant Agreement
(including, without limitation, a merger, consolidation, sale of all or
substantially all of the Company's assets or recapitalization of the Common,
but excluding any transaction to which Section 7(a) applies) in which the
previously outstanding Common Stock shall be changed into or, pursuant to the
operation of law or the terms of the transaction to which the Company is a
party, exchanged for different securities of the Company or common stock or
other securities of another corporation or interests in a noncorporate entity
or other property (including cash) or any combination of any of the foregoing,
then, as a condition of the consummation of such transaction, lawful and
adequate provision shall be made so that the holders of Warrants shall be
entitled, upon the exercise thereof, to an amount per share equal to (A) the
aggregate amount of stock, securities, cash and/or any other property (payable
in kind), as the case may be, into which or for which each share of Common
Stock is changed or exchanged multiplied by (B) the number of shares of
Common Stock for which each Warrant is exercisable immediately prior to the
consummation of such transaction. In case the Company shall be a party to a
transaction described in this Section 7(d), effective provision shall be made
by way of a supplemental agreement to this Agreement so that the provisions set
forth herein for the protection of the exercise rights of the Warrants shall
thereafter be applicable, as nearly as reasonably may be, to any such other
shares of stock and other securities and property deliverable upon exercise of
the
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Warrants; and the resulting or surviving corporation or other corporation
issuing or delivering such shares, other securities or property shall expressly
assume the obligation to deliver, upon the exercise of the Warrants, such
shares, securities or property as the holders of the Warrants shall be entitled
to receive, pursuant to the provisions hereof, and to make provision for the
protection of the exercise right as above provided. In case shares, securities
or property other than Common Stock shall be issuable or deliverable upon
exercise as aforesaid, then all references to Common Stock in this Section 7
shall be deemed to apply, so far as provided and as nearly as is reasonable, to
any such shares, other securities or property.
(e) Calculations to the Nearest Cent and One-Hundredth of a Share.
No adjustment in either of the Exercise Prices shall be required unless such
adjustment would require an increase or decrease of at least 1% in such price;
provided, however, that any adjustments which by reason of this Section 7(e)
are not required to be made shall be carried forward and taken into account in
any subsequent adjustment. All calculations under this Section 7 shall be made
to the nearest cent and to the nearest one-hundredth of a share, as the case
may be.
(f) Notice of Warrant Adjustment. Whenever either of the Exercise
Prices or the number of shares purchasable upon exercise of a Warrant shall be
adjusted as provided in this Section 7, the Company shall forthwith file with
the Warrant Agent a certificate, signed by a firm of independent public
accountants (which may be the regular accountants of the Company), showing in
detail the facts requiring such adjustment and the relevant Exercise Price and
number of shares so purchasable that will be effective after such adjustment.
The Company shall also cause a notice setting forth any adjustments to be sent
by mailing first-class, postage prepaid, to each registered holder of a Warrant
Certificate or Warrant Certificates at its address appearing on the Warrant
register and, at its option,
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may cause a copy of such notice to be published once in an English language
newspaper of general circulation in the City of Charlotte in the State of North
Carolina. The Warrant Agent shall have no duty with respect to any certificate
filed with it except to keep the same on file and available for inspection by
registered holders of Warrant Certificates during reasonable business hours.
The Warrant Agent shall not at any time be under any duty or responsibility to
any holder of a Warrant certificate to determine whether any facts exist which
may require any adjustment of either of the Exercise Prices, or with respect to
the nature of any adjustment of either of the Exercise Prices when made, or
with respect to the method employed in making such adjustment.
(g) Other Notices. In case the Company after the date hereof shall
propose to take any action of the type described in subsection (a), (b), (c) or
(d) of this Section 7, the Company shall file with the Warrant Agent a
certificate, signed by the Chairman of the Board, the Chief Executive Officer
or the President of the Company specifying the date on which such action shall
take place and shall also set forth such facts with respect thereto as shall be
reasonably necessary to indicate the effect of such action (to the extent such
fact may be known on the date of such notice) on the relevant Exercise Price
and the number, or kind, or class of shares or other securities or property
which shall be purchasable upon exercise of Warrants. Such notice shall be
given, in the case of any action of the type specified in subsections (a), (b)
and (c), at least 10 days prior to the record date with respect thereto and in
the case of any action of the type specified in subsection (d) at least 10 days
prior to the taking of such proposed action. The Company shall also cause a
notice setting forth any adjustments to be sent by mailing first-class, postage
prepaid, to each registered holder of a Warrant Certificate or Warrant
Certificates at its address appearing on the Warrant register and, at its
option, may cause a copy of such notice to be published once in an English
language newspaper
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of general circulation in the City of Charlotte in the State of North Carolina.
Failure to give such notice or any defect therein shall not affect the legality
or validity of such action.
(h) No Change in Warrant Certificate on Adjustment. Irrespective
of any of the adjustments in either of the Exercise Prices or the number of
shares of Warrant Common Stock, Warrant Certificates theretofore or thereafter
issued may continue to express the same prices and number of shares as are
stated in a similar Warrant Certificate issuable initially, or at some
subsequent time, pursuant to this Agreement and such number of shares specified
therein shall be deemed to have been so adjusted.
(i) Adjustments Upon Expiration of Certain Unexercised Securities.
Upon the expiration of any rights, warrants or convertible securities the
issuance of which resulted in an adjustment of either of the Exercise Prices
and the number of shares of Common Stock purchasable upon the exercise of a
Warrant pursuant to this Section 7, to the extent that any such rights,
warrants or convertible securities shall not have been exercised, the relevant
Exercise Price and the number of shares of Common Stock purchasable upon the
exercise of such Warrant shall, upon such expiration, be appropriately
readjusted; provided, however, that no such readjustment shall have the effect
of increasing the Exercise Prices by an amount in excess of the amount of the
adjustment initially made in respect of the issuance, sale or grant or such
rights, warrants or convertible securities.
SECTION 8. Exercise of Warrants. (a) Subject to the provisions of this
Agreement, each registered holder of a Warrant Certificate shall have the
right, which may be exercised as provided in such Warrant Certificate, to
purchase from the Company (and the Company shall issue and sell to such
registered holder) all or part of the number of fully paid and nonassessable
shares of Warrant Common Stock specified in such Warrant Certificate (subject
to the adjustments as herein provided),
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upon surrender to the Company at the Warrant Agent Office, of such Warrant
Certificate with the exercise form on the reverse thereof duly filled in and
signed (with any required signature guarantee), together with payment to the
Warrant Agent to the account of the Company of the relevant Exercise Price for
the number of shares of Warrant Common Stock in respect of which such Warrants
are then exercised. Upon surrender of such Warrant Certificate, it shall be
canceled by the Warrant Agent. The date of exercise of any Warrant shall be
deemed to be the date of its receipt by the Warrant Agent duly filled in and
signed and accompanied by proper and sufficient funds as herein provided.
Payment of the relevant Exercise Price may be made in cash or by certified or
official bank check. No adjustment shall be made for any cash dividends
declared or paid on shares of Common Stock prior to the exercise of a Warrant.
Upon such surrender of Warrants, and payment of the relevant Exercise Price as
aforesaid, the Company shall issue and cause to be delivered with all
reasonable dispatch to or upon the written order of the registered holder of
such Warrants, and in such name or names as such registered holder may
designate, a certificate or certificates for the number of full shares of
Common Stock so purchased upon the exercise of such Warrants together with cash
in respect of any fraction of a share of such stock issuable upon such
surrender, as provided in Section 9 of this Agreement.
(b) Each person in whose name any certificate for shares of Common
Stock is issued upon the exercise of Warrants shall for all purposes be deemed
to have become the holder of record of the Common Stock represented thereby on,
and such certificate shall be dated, the date upon which the Warrant
Certificate evidencing such Warrants was duly surrendered and payment of the
relevant Exercise Price (and any applicable transfer taxes) was made; provided,
however, that if the date of such surrender and payment is a date upon which
the Common Stock transfer books of the
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Company are closed, such person shall be deemed to have become the record
holder of such shares on, and such certificate shall be dated, the next
succeeding day on which the Common Stock transfer books of the Company are
open.
SECTION 9. Elimination of Fractions. The Company shall not be
required to issue fractional shares of stock upon any exercise of Warrants. As
to any final fraction of a share which the same registered holder of one or more
Warrant Certificate, the rights under which are exercised in the same
transaction or series of related transactions, would otherwise be entitled to
purchase upon such exercise, the Company shall pay a cash adjustment therefor
upon the basis of the relevant Exercise Price then in effect.
SECTION 10. Issue Taxes. The Company will pay all documentary
stamp taxes attributable to the initial issuance of shares of Warrant Common
Stock upon the exercise of any Warrant; provided, however, that neither the
Company nor the Warrant Agent shall be required to pay any tax or taxes which
may be payable in respect of any transfer involved in the issue or delivery of
any certificates for shares of Warrant Common Stock in a name other than that
of the registered holder of the Warrant Certificate representing the Warrant in
respect of which such shares are initially issued.
SECTION 11. Reservation of Shares. The Company shall, from the
date hereof through the date on which all Warrants shall have been exercised or
shall have expired, reserve and keep available out of its authorized but
unissued stock, for the purpose of effecting the issuance of stock upon
exercise or conversion of Warrants, such number of shares of its duly
authorized Common Stock as shall from time to time be sufficient to effect the
issuance of shares of Warrant Common Stock upon exercise of all Warrants at the
time outstanding.
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SECTION 12. Merger or Consolidation or Change of Name of Warrant
Agent.
(a) Any corporation into which the Warrant Agent may be merged or
with which it may be consolidated, or any corporation resulting from any merger
or consolidation to which the Warrant Agent shall be a party, or any
corporation succeeding to the corporate trust business of the Warrant Agent,
shall be the successor to the Warrant Agent hereunder without the execution or
filing of any paper or any further act on the part of any of the parties
hereto, anything herein to the contrary notwithstanding. In the case of Warrant
Certificates which have been countersigned by the Warrant Agent, but not
delivered at the time any such successor to the Warrant Agent succeeds to the
agency created by this Agreement, any such successor may adopt the
countersignature of the original Warrant Agent and deliver such Warrant
Certificates so countersigned; and in case at that time any of the Warrant
Certificates shall not have been countersigned, any successor to the Warrant
Agent may countersign such Warrant Certificates either in the name of the
predecessor Warrant Agent or in the name of such successor Warrant Agent; and
in all such cases such Warrant Certificates shall have the full force and
effect provided in the Warrant Certificates and in this Agreement.
(b) In case at any time the name of the Warrant Agent shall be
changed and at such time any of the Warrant Certificates shall have been
countersigned but not delivered, the Warrant Agent may adopt the
countersignature under its prior name and deliver Warrant Certificates so
countersigned; and in case at that time any of the Warrant Certificates shall
not have been countersigned, the Warrant Agent may countersign such Warrant
Certificates either in its prior name or in its changed name; and in all such
cases such Warrant Certificates shall have the full force and effect provided
in the Warrant Certificates and in this Agreement.
SECTION 13. Disposition of Proceeds on Exercise of Warrants. Etc.
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(a) The Warrant Agent shall account promptly to the Company with
respect to Warrants exercised and concurrently pay to the Company all moneys
received by the Warrant Agent for the purchase of shares of Common Stock
through the exercise of such Warrants.
(b) The Warrant Agent shall keep copies of this Agreement
available for inspection by holders of Warrant Certificates during normal
business hours at the Warrant Agent Office.
SECTION 14. Supplements and Amendments. The parties hereto may
from time to time supplement or amend this Agreement without the approval of
any holders of Warrant Certificates to cure any ambiguity or to correct or
supplement any provision contained in this Agreement which may be defective or
inconsistent with any other provision contained herein, or to make such other
provisions with respect to any change or any supplemental agreement as the
parties may deem necessary or desirable and which shall not materially
adversely affect the interests of the registered holders of the Warrant
Certificates. In addition, the parties hereto may from time to time supplement
or amend this Agreement with the consent of the holders of not less than 60% of
the Warrants; provided, however, that no such amendment or supplement shall
increase the applicable Exercise Price, shorten the relevant time within which
holders may exercise their Warrants or decrease the relevant number of shares
of Warrant Common Stock purchasable upon exercise of each Warrant (other than
in accordance with Section 7) without the consent of each holder of Warrants
adversely affected thereby.
SECTION 15. Mutilated or Missing Warrant Certificates. If any
Warrant Certificate shall be mutilated, lost, stolen or destroyed, the Warrant
Agent shall deliver a new Warrant Certificate of like tenor and denomination in
exchange and substitution therefor upon surrender and cancellation of the
mutilated Warrant Certificate or, in the case of a lost, stolen or destroyed
Warrant
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Certificate, upon receipt of evidence satisfactory to the Company and the
Warrant Agent of the loss, theft or destruction of such Warrant Certificate
and, in either case, upon receipt of such indemnity as may be reasonably be
required by either or both of the Company and the Warrant Agent. Applicants for
substitute Warrant Certificates shall also comply with such other reasonable
regulations and pay such other reasonable charges as may be prescribed by
either or both of the Warrant Agent and the Company. Any such new Warrant
Certificate shall constitute an original contractual obligation of the Company,
whether or not the allegedly lost, stolen, mutilated or destroyed Warrant
Certificate shall be at any time enforceable by anyone.
SECTION 16. Duties of the Warrant Agent. The Warrant Agent
undertakes the duties and obligations imposed by this Warrant Agreement upon
the following terms and conditions, by all of which the Company and the holders
of Warrant Certificates, by their acceptance thereof, shall be bound:
(a) The Warrant Agent shall not be liable for or by reason of any
of the statements of fact or recitals contained in this Agreement or in the
Warrant Certificates (except its countersignature thereof and except such as
describes the Warrant Agent or action taken by it) or be required to verify the
same, but all such statements and recitals are and shall be deemed to have been
made by the Company only. The Warrant Agent shall not be under any
responsibility in respect of the validity or execution of any Warrant
Certificate (except its countersignature thereof); nor shall it be responsible
for any breach by the Company of any covenant or condition contained in this
Agreement or in any Warrant Certificate to be complied with by the Company; nor
shall it be responsible for the making of any adjustment in the Exercise Price
or the number of shares issuable upon the exercise of a Warrant required under
the provisions of Section 7 or responsible for the
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manner, method or amount of any such change or the ascertaining of the
existence of facts that would require any such change; nor shall it by any act
hereunder be deemed to make any representation or warranty as to the
authorization or reservation of any shares to be issued pursuant to this
Agreement or any Warrant or as to whether any shares will, when issued, be
validly issued and fully paid and nonassessable.
(b) The Warrant Agent may execute and exercise any of the rights
or powers hereby vested in it or perform any duty hereunder either itself or by
or through its attorneys, agents or employees.
(c) The Warrant Agent may consult at any time with legal counsel
satisfactory to it (who may be legal counsel for the Company), provided that
the Warrant Agent shall have exercised reasonable care in the selection and
continued employment of such counsel, and the advice of such counsel shall be
full and complete authorization and protection to the Warrant Agent as to any
action taken or omitted by it in good faith and in accordance with such advice.
(d) The Warrant Agent shall incur no liability or responsibility
to the Company or to any holder of a Warrant Certificate for any action taken
in reliance on any notice, resolution, waiver, consent, order, certificate or
other paper, document or instrument believed by it to be genuine and to have
been signed, sent or presented by the proper party or parties.
(e) The Company agrees to pay to the Warrant Agent the fees set
forth in Schedule I hereto for all services rendered by the Warrant Agent in
the execution of this Warrant Agreement, to reimburse the Warrant Agent for all
expenses (including reasonable counsel fees), taxes and governmental charges
and other charges of any kind and nature reasonably incurred by the Warrant
Agent in the execution of this Warrant Agreement and to indemnify the Warrant
Agent and save it
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harmless against any and all liabilities, including judgments, costs and
reasonable counsel fees, for anything done or omitted by the Warrant Agent in
the execution of this Warrant Agreement except as a result of the Warrant
Agent's gross negligence, wilful misconduct or bad faith. The foregoing
indemnities in this paragraph shall survive termination or removal of the
Warrant Agent or termination of this Agreement.
(f) The Warrant Agent and any stockholder, director, officer or
employee of the Warrant Agent may buy, sell or deal in any of the Warrants or
other securities of the Company or become pecuniarily interested in any
transaction in which the Company may be interested, or contract with or lend
money to the Company or otherwise act as fully and freely as though it were not
Warrant Agent under this Warrant Agreement. Nothing herein shall preclude the
Warrant Agent from acting in any other capacity for the Company or for any
other legal entity.
(g) The Warrant Agent shall act hereunder solely as agent for the
Company and in a ministerial capacity, and its duties shall be determined
solely by the provisions hereof. The Warrant Agent shall not be liable for
anything which it may do or refrain from doing in connection with this
Agreement except for its own gross negligence, wilful misconduct or bad faith.
SECTION 17. Change of Warrant Agent. The Warrant Agent may resign
and be discharged from its duties under this Agreement upon 30 days' prior
notice in writing mailed to the Company by registered or certified mail, and to
the holders of the Warrant Certificates by first-class mail. The Company may
remove the Warrant Agent or any successor Warrant Agent upon 30 days' prior
notice in writing, mailed to the Warrant Agent or successor Warrant Agent, as
the case may be, and to each transfer agent of the Common Stock by registered
or certified mail, and to the holders of the Warrant Certificates by
first-class mail. If the Warrant Agent shall resign or be removed or
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shall otherwise become incapable of acting, the Company shall appoint a
successor to the Warrant Agent. If the Company shall fail to make such
appointment within a period of 30 days after such removal or after it has been
notified in writing of such resignation or incapacity by the resigning or
incapacitated Warrant Agent or by the holder of a Warrant Certificate (who
shall, with such notice, submit his Warrant Certificate for inspection by the
Company), then the registered holder of any Warrant Certificate may apply to
any court of competent jurisdiction for the appointment of a new Warrant Agent.
Any successor Warrant Agent, whether appointed by the Company or by such a
court, shall be a corporation organized and doing business under the laws of
the United States or of any state thereof, in good standing, which is authorized
under such laws to exercise corporate trust powers and is subject to supervision
or examination by federal or state authority and which has at the time of its
appointment as Warrant Agent a combined capital and surplus of at least
$50,000,000. After appointment, the successor Warrant Agent shall be vested
with the same powers, rights, duties and responsibilities as if it had been
originally named as Warrant Agent without further act or deed; but the
predecessor or Warrant Agent shall deliver and transfer to the successor
Warrant Agent any property at the time held by it hereunder, and execute and
deliver any further assurance, conveyance, act or deed necessary for the
purpose. Not later than the effective date of such appointment the Company
shall file notice thereof in writing with the predecessor Warrant Agent and
each transfer agent of the Common Stock, and mail a notice thereof in writing
to the registered holders of the Warrant Certificates. Failure to give any
notice provided for in this Section 17, however, or any defect therein, shall
not affect the legality or validity of the resignation or removal of the
Warrant Agent or the appointment of the successor Warrant Agent, as the case
may be.
SECTION 18. Identity of Transfer Agent. Forthwith upon the
appointment of any
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subsequent transfer agent for shares of the Common Stock, the Company will file
with the Warrant Agent a statement setting forth the name and address of such
transfer agent.
SECTION 19. Notices. Any notice pursuant to this Agreement to be
given by the Warrant Agent or by the registered holder of any Warrant
Certificate to the Company shall be sufficiently given if sent by first-class
mail, postage prepaid, addressed (until another address is filed in writing by
the Company with the Warrant Agent) as follows:
HomePlace of America, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Chief Executive Officer
with a copy to:
Parker, Poe, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇., Esq.
Any notice pursuant to this Agreement to be given by the Company or by the
registered holder of any Warrant Certificate to the Warrant Agent shall be
sufficiently given if sent by first-class mail, postage prepaid, addressed
(until another address is filed in writing by the Warrant Agent with the
Company) as follows:
First Union National Bank
▇▇▇▇ ▇▇▇▇ ▇.▇. ▇▇▇▇▇▇ ▇▇▇▇. ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇ ▇▇▇▇▇
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SECTION 20. Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Warrant Agent shall bind
and inure to the benefit of their respective successors and assigns hereunder.
SECTION 21. Governing Law. This Agreement and each Warrant issued
hereunder shall be deemed to be a contract made under the laws of the State of
Delaware and for all purposes shall be construed in accordance with the laws of
the State of Delaware without regard to the conflicts of laws principles
thereof.
SECTION 22. Benefits of this Agreement. Nothing in this Agreement
shall be construed to give to any person or corporation other than the Company,
the Warrant Agent and the registered holders of the Warrant Certificates any
legal or equitable right, remedy or claim under this Agreement.
SECTION 23. Counterparts. This Agreement may be executed in any
number of counterparts, and each of such counterparts shall for all purposes be
deemed to be an original, and all such counterparts shall together constitute
but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Warrant
Agreement to be executed and delivered as of the day and year first above
written.
(Signatures appear on following page.)
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HOMEPLACE OF AMERICA, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Senior Vice President, Finance
Attest:
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇.
Assistant Secretary
FIRST UNION NATIONAL BANK,
as Warrant Agent,
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By: /s/ J. ▇▇▇▇▇▇▇ ▇▇▇▇▇
---------------------------------
Name: J. ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Vice President
Attest:
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------
SCHEDULE I
WARRANT AGENT FEES
ONE-TIME ACCEPTANCE FEE WAIVED
ANNUAL ADMINISTRATION $1,500
Perform the duties as described in the Warrant Agreement, billed annually.
WARRANT AGENT SERVICES $7.50 PER WARRANT EXERCISED
Billed monthly in arrears
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