Exhibit 10.23
Warrant Agreement
WARRANT AGREEMENT
by and between
GENESIS HEALTH VENTURES, INC.
and
MELLON INVESTOR SERVICES LLC
as Warrant Agent
4,559,475 Warrants
Dated as of October 2, 2001
TABLE OF CONTENTS
Page
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Article 1 DEFINITIONS................................................................................1
Article 2 ISSUANCE OF WARRANTS.......................................................................3
2.1 Initial Issuance...............................................................................3
2.2 Initial Share Amount...........................................................................3
2.3 Form of Warrant Certificates...................................................................4
2.4 Execution of Warrant Certificates..............................................................4
2.5 Countersignature of Warrant Certificates.......................................................4
Article 3 EXERCISE PERIOD............................................................................5
Article 4 EXERCISE OF WARRANTS.......................................................................5
4.1 The Exercise Price.............................................................................5
4.2 Manner of Exercise.............................................................................5
4.3 When Exercise Effective........................................................................5
4.4 Delivery of Certificates, Etc..................................................................6
4.5 Fractional Shares..............................................................................6
Article 5 ADJUSTMENT OF THE AMOUNT OF COMMON STOCK ISSUABLE AND THE EXERCISE PRICE UPON EXERCISE.....7
5.1 Adjustment for Change in Capital Stock.........................................................7
5.2 Distributions..................................................................................7
5.3 Adjustments for Mergers and Consolidations.....................................................8
5.4 No De Minimis Adjustments; Calculation to Nearest Cent and One-hundredth of Share..............8
5.5 Notice of Adjustment; Warrant Agent's Disclaimer...............................................8
5.6 Other Notices..................................................................................9
5.7 No Change in Warrant Terms on Adjustment.......................................................9
5.8 Section 305 Issues.............................................................................9
5.9 Other Eventst..................................................................................9
Article 6 MERGER, CONSOLIDATION, ETC................................................................10
Article 7 NOTIFICATION OF CERTAIN EVENTS............................................................10
7.1 Corporate Action..............................................................................10
7.2 Available Information.........................................................................11
Article 8 RESERVATION OF STOCK......................................................................11
Article 9 LOSS OR MUTILATION........................................................................12
Page
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Article 10 WARRANT REGISTRATION......................................................................12
10.1 Registration..................................................................................12
10.2 Transfer or Exchange..........................................................................13
10.3 Valid and Enforceable.........................................................................13
10.4 Endorsement...................................................................................13
10.5 No Service Charge.............................................................................13
10.6 Treatment of Holders of Warrant Certificates..................................................13
10.7 Cancellation..................................................................................13
Article 11 WARRANT AGENT.............................................................................13
11.1 Obligations Binding...........................................................................13
11.2 No Liability..................................................................................14
11.3 Instructions..................................................................................14
11.4 Agents........................................................................................15
11.5 Cooperation...................................................................................15
11.6 Agent Only....................................................................................15
11.7 Right to Counsel..............................................................................15
11.8 Compensation..................................................................................15
11.9 Accounting....................................................................................16
11.10 No Conflict...................................................................................16
11.11 Resignation; Termination......................................................................16
11.12 Change of Warrant Agent.......................................................................17
11.13 Successor Warrant Agent.......................................................................17
Article 12 REMEDIES, ETC.............................................................................18
Article 13 MISCELLANEOUS.............................................................................18
13.1 Notices.......................................................................................18
13.2 Governing Law and Consent to Forum............................................................19
13.3 Benefits of this Agreement....................................................................19
13.4 Agreement of Holders of Warrant Certificates..................................................19
13.5 Counterparts..................................................................................19
13.6 Amendments....................................................................................19
13.7 Consent to Jurisdiction.......................................................................20
13.8 Headings......................................................................................20
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EXHIBITS
Exhibit A: Form of Warrant Certificate
4
WARRANT AGREEMENT
THIS WARRANT AGREEMENT is made and entered into as of October
2, 2001 by and between Genesis Health Ventures, Inc., a Pennsylvania corporation
(the "Company"), and Mellon Investor Services LLC, a New Jersey limited
liability company, as Warrant Agent (the "Warrant Agent").
WITNESSETH:
WHEREAS, in connection with the financial restructuring of the
Company, pursuant to the Joint Plan of Reorganization, of the Company, The
Multicare Companies, Inc. and certain of their respective subsidiaries, dated as
of June 5, 2001 (the "Plan"), the Company is issuing warrants which are
exercisable to purchase up to 4,559,475 shares of Common Stock (as defined
herein), subject to adjustment as provided herein (the "Warrants"), to the
holders of certain allowed claims of the Company (the "Claims") in partial
exchange for such Claims and in accordance with the Plan;
WHEREAS, the Company desires the Warrant Agent to act on
behalf of the Company and the Warrant Agent is willing to act, in connection
with the issuance, transfer, exchange, replacement and exercise of the Warrant
Certificates (as defined herein) and other matters as provided herein; and
WHEREAS, the Company desires to enter into this Agreement to
set forth the terms and conditions of the Warrants and the rights of the holders
thereof;
NOW, THEREFORE, in consideration of the foregoing premises and
of the mutual agreements set forth herein, the Company and the Warrant Agent
hereby agree as follows:
ARTICLE 1
DEFINITIONS
-----------
As used herein, the following terms have the following
respective meanings:
"Agreement" means this Warrant Agreement, as the same may be
amended or modified from time to time hereafter.
"Bankruptcy Court" means the United States Bankruptcy Court
for the District of Delaware that has jurisdiction of the chapter 11 case of the
Company under title 11 of the United States Code.
"Business Day" means any day other than a Saturday or a Sunday
or a day on which commercial banking institutions in New York City, New York or
the State of New Jersey are authorized or required by law to be closed;
provided, that, in determining the period within which certificates or Warrants
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are to be issued and delivered at a time when shares of Common Stock (or Other
Securities) are listed or admitted to trading on any national securities
exchange or in the over-the-counter market and in determining the Fair Value of
any securities listed or admitted to trading on any national securities exchange
or in the over-the-counter market, "Business Day" shall mean any day when the
principal exchange on which such securities are then listed or admitted to
trading is open for trading or, if such securities are traded in the
over-the-counter market in the United States, such market is open for trading;
and provided, further, that any reference in this Agreement to "days" (unless
Business Days are specified) shall mean calendar days.
"Claims" has the meaning specified in the recitals hereto.
"Commission" means the Securities and Exchange Commission or
any other Federal agency at the time administering the Securities Act of 1933,
as amended, or the Exchange Act, whichever is the relevant statute for the
particular purpose.
"Common Stock" means the Company's Common Stock, par value
$.02 per share.
"Company" has the meaning specified in the preamble hereof.
"Exchange Act" means the Securities Exchange Act of 1934, or
any successor Federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be amended and in effect at the time. Any
reference herein to a particular section of the Securities Exchange Act of 1934
shall include a reference to the comparable section, if any, of any such
successor Federal statute.
"Exercise Period" means the period commencing on the Effective
Date (as defined in the Plan) and ending at 5:00 P.M., New York time, on the
first anniversary of the Effective Date.
"Exercise Price" has the meaning specified in Section 4.1
hereof.
"Fair Value" means (i) with respect to Common Stock or any
Other Security, in each case, if such security is listed on one or more stock
exchanges or quoted on the National Market System or Small Cap Market of NASDAQ
(the "NASDAQ Market"), the average of the closing or last reported sales prices
of a share of Common Stock or, if an Other Security in the minimum denomination
in which such security is traded, on the primary national or regional stock
exchange on which such security is listed or on the NASDAQ Market if quoted
thereon or (ii) if the Common Stock or Other Security, as the case may be, is
not so listed or quoted but is traded in the over-the-counter market (other than
the NASDAQ Market), the average of the closing bid and asked prices of a share
of such Common Stock or Other Security, in each case quoted for the 30 Business
Days (or such lesser number of Business Days as such Common Stock (or Other
Security) shall have been so listed, quoted or traded) next preceding the date
of measurement; provided, however, that if no such sales price or bid and asked
prices have been quoted during the preceding 30-day period or there is otherwise
no established trading market for such security, then "Fair Value" means the
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value of such Common Stock or Other Security as determined reasonably and in
good faith by the Board of Directors of the Company. Anything herein to the
contrary notwithstanding, in case the Company shall issue any shares of Common
Stock, rights, options, or Other Securities in connection with the acquisition
by the Company of the stock or assets of any other Person or the merger of any
other Person into the Company, the Fair Value of the Common Stock or Other
Securities so issued shall be determined as of the date the number of shares of
Common Stock, rights, options or Other Securities was determined (as set forth
in a written agreement between the Company and the other party to the
transaction) rather than on the date of issuance of such shares of Common Stock,
rights, options or Other Securities.
"Original Issue Date" means the Effective Date (as defined in
the Plan).
"Other Securities" or "Other Security" means any stock (other
than Common Stock) and other securities of the Company or any other Person
(corporate or otherwise) that the holders of the Warrants at any time shall be
entitled to receive or shall have received, upon the exercise of the Warrants,
in lieu of or in addition to Common Stock, or that at any time shall be issuable
or shall have been issued in exchange for or in replacement of Common Stock or
Other Securities.
"Other Shares" has the meaning specified in Section 5.2
hereof.
"Person" means any individual, partnership, association, joint
venture, corporation, limited liability company, business trust, unincorporated
organization, government or department, agency or subdivision thereof, or other
person or entity, and shall include any successor (by merger or otherwise) of
any such Person.
"Plan" has the meaning specified in the recitals hereto.
"Warrant Agent" has the meaning specified in the preamble
hereof.
"Warrant Certificates" has the meaning specified in Section
2.3 hereof.
"Warrants" has the meaning set forth in the recitals hereto.
ARTICLE 2
ISSUANCE OF WARRANTS
--------------------
2.1 Initial Issuance. On the date hereof (the "Original Issue Date"),
the Company shall, pursuant to the Plan, deliver to the Company's disbursing
agent under the Plan for re-distribution to the holders of the certain claims
against the Company a global certificate for an aggregate of 4,559,475 Warrants.
2.2 Initial Share Amount. The number of shares of Common Stock
purchasable upon exercise of the Warrants shall be one (1) share of Common Stock
to one (1) Warrant, subject to adjustments from and after the Original Issue
Date as provided in Article 5 of this Agreement.
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2.3 Form of Warrant Certificates. The Warrants shall be evidenced by
certificates substantially in the form attached hereto as Exhibit A (the
"Warrant Certificates") or may, if the Company so directs, be issued in
book-entry form. Each Warrant Certificate shall be dated as of the Original
Issue Date or, in the event of a division, exchange, substitution or transfer of
any of the Warrants, on the date of such event. The Warrant Certificate may have
such further legends and endorsements stamped, printed, lithographed or engraved
thereon as the Company may deem appropriate (which do not affect the rights,
duties or responsibilities of the Warrant Agent) and as are not inconsistent
with the provisions of this Agreement, or as may be required to comply with any
law or with any rule or regulation pursuant thereto or with any rule or
regulation of any securities exchange, market or trading facility on which the
Warrants may be listed or admitted for trading.
2.4 Execution of Warrant Certificates. Warrant Certificates shall be
executed on behalf of the Company by its Chairman of the Board, Chief Executive
Officer, President, any Senior Vice President, any Vice President, Treasurer or
Secretary, either manually or by facsimile signature printed thereon. In case
any such officer of the Company whose signature shall have been placed upon any
Warrant Certificate shall cease to be such officer of the Company before
countersignature by the Warrant Agent or issuance and delivery thereof, such
Warrant Certificate nevertheless may be countersigned by the Warrant Agent and
issued and delivered with the same force and effect as though such person had
not ceased to be such officer of the Company.
The term "holder" or "holder of a Warrant Certificate" as used herein
shall mean any Person in whose name at the time any Warrant Certificate shall be
registered upon the books to be maintained by the Warrant Agent for that
purpose.
2.5 Countersignature of Warrant Certificates. Upon the execution of
this Agreement, the Company will execute and deliver to the Warrant Agent one or
more Warrant Certificates representing the number of Warrants issued pursuant to
the Plan. Upon receipt of written instructions from an authorized signatory of
the Company, Warrant Certificates shall be manually countersigned by an
authorized signatory of the Warrant Agent and shall not be valid for any purpose
unless so countersigned. Such manual countersignature shall constitute
conclusive evidence of such authorization. No Warrant Certificate shall be valid
for any purpose, and no Warrant evidenced thereby shall be exercisable, until
such Warrant Certificate has been countersigned by the manual signature of the
Warrant Agent. The Warrant Agent is hereby authorized to countersign, in
accordance with the provisions of this Section 2.5, and deliver any new Warrant
Certificates, as directed in writing by the Company pursuant to Section 2.1 and
as and when required pursuant to the provisions of Articles 9 and 10. Each
Warrant Certificate shall, when manually countersigned by an authorized
signatory of the Warrant Agent, entitle the registered holder thereof to
exercise the rights as the holder of the number of Warrants set forth thereon,
subject to the provisions of this Agreement.
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ARTICLE 3
EXERCISE PERIOD
---------------
Each Warrant shall entitle the holder thereof to purchase from the
Company one (1) share of Common Stock (subject to the adjustments provided
herein), at any time during the Exercise Period. Any Warrant not exercised
during the Exercise Period shall become null and void, and all rights of the
holder of the Warrant Certificate evidencing such Warrant under the Warrant
Certificate or this Agreement shall cease.
ARTICLE 4
EXERCISE OF WARRANTS
--------------------
4.1 The Exercise Price. The exercise price of each Warrant is $20.33
per share of Common Stock (the "Exercise Price"). The Exercise Price is subject
to adjustment pursuant to Article 5 hereof.
4.2 Manner of Exercise. (a) During the Exercise Period, all or any
whole number of Warrants represented by a Warrant Certificate may be exercised
by the registered holder thereof during normal business hours on any Business
Day, by surrendering such Warrant Certificate, with the subscription form set
forth therein duly completed and executed by such holder, by hand, by overnight
courier or by mail to the Warrant Agent at its office addressed to Mellon
Investor Services LLC, ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇.
Such Warrant Certificate shall be accompanied by payment in full in respect of
each Warrant that is exercised, which shall be made by certified or official
bank or bank cashier's check payable to the order of the Company, or by wire
transfer of immediately available funds to an account designated by the Warrant
Agent for the benefit of the Company, except as otherwise provided herein. Such
payment shall be in an amount equal to the product of the number of shares of
Common Stock (without giving effect to any adjustment therein) designated in
such subscription form multiplied by the Exercise Price for the Warrants being
exercised (plus such additional consideration as may be provided herein). Upon
such surrender and payment prior to the expiration of the Exercise Period, such
holder shall thereupon be entitled to receive the number of duly authorized,
validly issued, registered, fully paid and nonassessable shares of Common Stock
(or Other Securities) determined as provided in Articles 2 and 3, and as and if
adjusted pursuant to Article 5.
4.3 When Exercise Effective. Each exercise of any Warrant pursuant to
Section 4.2 shall be deemed to have been effected immediately prior to the close
of business on the Business Day on which the Warrant Certificate representing
such Warrant, duly executed, with accompanying payment, shall have been
delivered as provided in Section 4.2, and at such time the Person or Persons in
whose name or names the certificate or certificates for Common Stock (or Other
Securities) shall be issuable upon such exercise as provided in Section 4.4
shall be deemed to have become the holder or holders of record thereof.
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4.4 Delivery of Certificates, Etc. (a) As promptly as practicable after
the exercise of any Warrant, and in any event within three (3) Business Days
thereafter, the Company at its expense (other than as to payment of taxes or
governmental charges which will be paid by the holder) will cause to be issued
and delivered to such holder, or as such holder may otherwise direct in writing
(subject to Article 11),
(i) a certificate or certificates for the number of shares of
Common Stock (or Other Securities) to which such holder is
entitled, and
(ii) if less than all the Warrants represented by a Warrant
Certificate are exercised, a new Warrant Certificate or
Certificates of the same tenor and for the aggregate number of
Warrants that were not exercised, executed and countersigned
in accordance with Sections 2.4 and 2.5.
(b) The Warrant Agent shall countersign any new Warrant Certificate,
register it in such name or names as may be directed in writing by such holder,
and shall deliver it to the Person entitled to receive the same in accordance
with this Section 4.4. The Company, whenever required by the Warrant Agent, will
supply the Warrant Agent with Warrant Certificates executed on behalf of the
Company for such purpose.
(c) Upon any exercise of Warrants, the Warrant Agent shall, from time
to time, as promptly as practicable, advise the Treasurer of the Company or his
or her designee of (i) the number of Warrants exercised, (ii) the instruction of
each holder of the Warrant Certificates evidencing such Warrants with respect to
delivery of the Common Stock to which such holder is entitled upon such
exercise, (iii) the timing of delivery of Warrant Certificates evidencing the
balance, if any, of the Warrants remaining after such exercise, and (iv) such
other information as the Company shall reasonably require.
(d) The Company shall not be required to pay any stamp or other tax or
other governmental charge required to be paid in connection with any transfer
involved in the issue of the Common Stock to a Person other than a registered
holder; and in the event that any such transfer is involved, the Company shall
not be required to issue or deliver any Warrant Certificate or share of Common
Stock until such tax or other charge shall have been paid or it has been
established to the Company's reasonable satisfaction that no such tax or other
charge is due. The Warrant Agent shall have no duty or obligation under this
Section 4 or any other similar provision of this Agreement unless and until it
is satisfied that all such taxes and/or governmental charges have been paid in
full.
4.5 Fractional Shares. No fractional shares of Common Stock (or Other
Securities) shall be issued upon the exercise of any Warrant. If more than one
Warrant Certificate shall be delivered for exercise at one time by the same
holder, the number of full shares or securities that shall be issuable upon
10
exercise shall be computed on the basis of the aggregate number of Warrants
exercised. As to any fraction of a share of Common Stock (or Other Securities),
the Company shall pay a cash adjustment in respect thereto in an amount equal to
the product of the Fair Value per share of Common Stock (or Other Securities) as
of the Business Day next preceding the date of such exercise multiplied by such
fraction of a share. The Warrant Agent shall have no duty or obligation under
this Section 4.5 (including but not limited to the payment, calculation or
valuation of any fraction of a share of Common Stock) unless and until the
Company has provided or caused to be provided to the Warrant Agent sufficient
cash necessary to satisfy the Company's obligations with respect to any fraction
of a share of Common Stock.
ARTICLE 5
ADJUSTMENT OF THE AMOUNT OF COMMON STOCK
ISSUABLE AND THE EXERCISE PRICE UPON EXERCISE
---------------------------------------------
5.1 Adjustment for Change in Capital Stock. If the Company shall (i)
declare or pay a dividend on its outstanding shares of Common Stock or make a
distribution to holders of its Common Stock, in either case in shares of Common
Stock, (ii) subdivide its outstanding shares of Common Stock into a greater
number of shares of Common Stock, (iii) combine its outstanding shares of Common
Stock into a smaller number of shares of Common Stock, or (iv) issue by
reclassification of its shares of Common Stock other securities of the Company,
then the number of shares of Common Stock issuable for each Warrant and the
Exercise Price in effect immediately prior thereto shall be adjusted so that the
holder of any Warrants thereafter exercised shall be entitled to receive the
number and kind of shares of Common Stock or other securities that the holder
would have owned or been entitled to receive after the happening of any of the
events described above had such Warrants been exercised immediately prior to the
happening of such event or any record date with respect thereto. An adjustment
made pursuant to this Section 5.1 shall become effective on the date of the
dividend payment, subdivision, combination or issuance retroactive to the record
date with respect thereto, if any, for such event. Such adjustment shall be made
successively.
5.2 Distributions. If after the date hereof the Company shall
distribute to all holders of its shares of Common Stock evidences of its
indebtedness, shares of another class of capital stock ("Other Shares"), 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
incorporation of the Company) or rights to subscribe to shares of Common Stock,
then in each such case, unless the Company elects to reserve such indebtedness,
assets, rights or shares for distribution to each holder of a Warrant upon the
exercise of the Warrants so that such holder will receive upon such exercise, in
addition to the shares of Common Stock to which such holder is entitled, the
amount and kind of such indebtedness, assets, rights or shares which such holder
would have received if such holder had, immediately prior to the record date for
the distribution of such indebtedness, assets, rights or shares, exercised the
Warrants and received Common Stock, the Exercise Price in effect immediately
prior to such distribution shall be decreased to an amount determined by
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multiplying such Exercise Price by a fraction, the numerator of which is the
Fair Value of a share of the Common Stock at the date of such distribution less
the fair value of the evidences of indebtedness, Other Shares, assets or
subscription rights as the case may be, so distributed (as determined in good
faith by the Board of Directors of the Company, whose determination shall be
conclusive, and described in a reasonably detailed statement filed with the
Warrant Agent) and the denominator of which is the Fair Value of a share of
Common Stock at such date. Such adjustment shall be made whenever any such
distribution is made, and shall become effective retroactively on the date
immediately after the record date for the determination of stockholders entitled
to receive such distribution.
5.3 Adjustments for Mergers and Consolidations. In case the Company,
after the date hereof, shall merge or consolidate (other than a merger or
consolidation in which the Company is the continuing corporation and which does
not result in any change in the shares of Common Stock) with another Person,
then, in the case of any such transaction, proper provision shall be made so
that, upon the basis and terms and in the manner provided in this Agreement, the
holders of the Warrants, upon the exercise thereof at any time after the
consummation of such transaction (subject to the Exercise Period), shall be
entitled to receive (at the aggregate Exercise Price in effect at the time of
the transaction for all Common Stock or Other Securities issuable upon such
exercise immediately prior to such consummation), in lieu of the Common Stock or
Other Securities issuable upon such exercise prior to such consummation, the
greatest amount of securities, cash or other property to which such holder would
have been entitled as a holder of Common Stock (or Other Securities) upon such
consummation if such holder had exercised the rights represented by the Warrants
held by such holder immediately prior thereto.
5.4 No De Minimis Adjustments; Calculation to Nearest Cent and
One-hundredth of Share. No adjustment in the Exercise Price shall be required
under this Article 5 unless such adjustment would require an increase or
decrease of at least one percent (1%) of such price. All calculations under this
Article 5 shall be made to the nearest cent or to the nearest one-hundredth of a
share, as the case may be.
5.5 Notice of Adjustment; Warrant Agent's Disclaimer. (a) Whenever the
Exercise Price and securities issuable shall be adjusted as provided in this
Article 5, the Company shall forthwith file with the Warrant Agent a statement,
signed by the Chairman of the Board, Chief Executive Officer, President, any
Senior Vice President, any Vice President, the Treasurer or Secretary of the
Company, stating in detail the facts and computations requiring such adjustment,
the method of calculation thereof, the Exercise Price that will be effective
after such adjustment and the impact of such adjustment on the number and kind
of securities issuable upon exercise of the Warrants. The Company shall also
cause the Warrant Agent to mail (first class, postage prepaid) a notice setting
forth any such adjustments to each registered holder of Warrants at its last
address appearing on the Warrant register.
(b) Except as provided in paragraph (a) above, the Warrant Agent shall
have no duty with respect to any statement filed with it except to keep the same
on file and available for inspection by registered holders of Warrants during
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reasonable business hours. The Warrant Agent shall not at any time be under any
duty or responsibility to any holder of a Warrant to determine whether any facts
exist which may require any adjustment to the Exercise Price or securities
issuable, or with respect to the nature or extent of any adjustment of the
Exercise Price or securities issuable when made or with respect to the method
employed in making such adjustment. The Warrant Agent shall not be responsible
for the Company's failure to comply with any provision of this Article 5. The
Warrant Agent shall have no duty or obligation with respect to this Article 5
unless and until it has received specific instructions (and sufficient cash, if
required) from the Company with respect to its duties and obligations under such
Article.
5.6 Other Notices. In case the Company after the date hereof shall
propose to take any action of the type described in Section 5.1 or 5.2 of this
Article 5, the Company shall give notice to the Warrant Agent and to each
registered holder of a Warrant in the manner set forth in Section 5.5 of this
Article 5, which notice shall specify the date on which a record shall be taken
with respect to any such action. Such notice shall be given at least ten (10)
days prior to the record date with respect thereto. Failure to give such notice,
or any defect therein, shall not affect the legality or validity of any such
action. Where appropriate, such notice may be given in advance and may be
included as part of a notice required to be mailed under the provision of
Section 5.5 of this Article 5.
5.7 No Change in Warrant Terms on Adjustment. Irrespective of any
adjustments in the Exercise Price or the number of shares of Common Stock (or
any inclusion of Other Securities) issuable upon exercise, Warrants theretofore
or thereafter issued may continue to express the same prices and number of
shares as are stated in the similar Warrants issuable initially, or at some
subsequent time, pursuant to this Agreement, and the Exercise Price and such
number of shares issuable upon exercise specified thereon shall be deemed to
have been so adjusted.
5.8 Section 305 Issues. Anything in this Article 5 to the contrary
notwithstanding, the Company shall be entitled, but not required, to make such
reductions in the Exercise Price, in addition to those required by Section 5.2,
as it in its discretion shall determine to be advisable in order that any
dividend in or distribution of shares of Common Stock or shares of capital stock
or any class other than Common Stock, subdivision, reclassification or
combination of shares of Common Stock, issuance of rights or warrants, or any
other transaction having similar effect, shall not be treated as a distribution
of property by the Company to its shareholders under Section 305 of the Internal
Revenue Code of 1986, as amended, or any successor provision and shall not be
taxable to them.
5.9 Other Events. If any event occurs that would adversely affect each
holder's rights but not expressly provided for by this Section (including,
without limitation, the granting of stock appreciation rights, phantom stock
rights or other rights with equity features), then the Company's Board of
Directors will make an appropriate adjustment in the Exercise Price so as to
protect each holder's rights; provided, however, that no such adjustment will
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increase the Exercise Price or decrease the number of shares of Common Stock
obtainable as otherwise determined pursuant to this Section 5.9.
ARTICLE 6
MERGER, CONSOLIDATION, ETC.
Notwithstanding anything contained herein to the contrary, the Company
will not effect a merger or consolidation unless, prior to the consummation of
such transaction, each Person (other than the Company) which may be required to
deliver any Common Stock, Other Securities, securities, cash or property upon
the exercise of this Warrant as provided herein shall assume, by written
instrument delivered to the Warrant Agent, the obligations of the Company under
this Agreement and under each of the Warrants, including, without limitation,
the obligation to deliver such shares of Common Stock, Other Securities, cash or
property as may be required pursuant to Article 5 hereof or the certificate or
articles of incorporation or other constituent document, shall be equivalent to
the adjustments provided for in Article 5 hereof.
ARTICLE 7
NOTIFICATION OF CERTAIN EVENTS
------------------------------
7.1 Corporate Action. In the event of:
(a) any taking by the Company of a record of the holders of any class
of securities for the purpose of determining the holders thereof who are
entitled to receive any dividend (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 incorporation of the Company) or
other distribution of any kind, or any right to subscribe for, purchase or
otherwise acquire any shares of stock of any class or any other securities or
property, or to receive any other right or interest of any kind; or
(b) (i) any capital reorganization of the Company, (ii) any
reclassification of the capital shares of the Company (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 split-up or combination), (iii) the consolidation or merger of
the Company with or into any other corporation (other than a consolidation or
merger in which the Company is the continuing corporation and which does not
result in any change in the shares of Common Stock), (iv) the sale or transfer
of the properties and assets of the Company as, or substantially as, an entirety
to another Person, or (v) an exchange offer for Common Stock (or Other
Securities); or
(c) the voluntary or involuntary dissolution, liquidation, or winding
up of the Company, the Company shall cause to be filed with the Warrant Agent
and mailed to each holder of a Warrant a notice specifying (x) the date or
expected date on which any such record is to be taken for the purpose of such
dividend, distribution or right, and the amount and character of any such
dividend, distribution or right, if a record is not to be taken, the date as of
which the holders of Common Stock of record to be entitled to such dividend,
14
distribution, or right are to be determined, and the amount and character of
such dividend, distribution or right, or (y) the date or expected date on which
any such reorganization, reclassification, consolidation, merger, sale,
transfer, exchange offer, dissolution, liquidation or winding up is expected to
become effective, and the time, if any such time is to be fixed, as of which
holders of record of Common Stock (or Other Securities) shall be entitled to
exchange their shares of Common Stock (or Other Securities) for the securities
or other property deliverable upon such reorganization, reclassification,
consolidation, merger, sale, transfer, exchange offer, dissolution, liquidation
or winding up. Such notice shall be delivered not less than twenty (20) days
prior to such date therein specified, in the case of any such date referred to
in clause (x) of the preceding sentence, and not less than thirty (30) days
prior to such date therein specified, in the case of any such date referred to
in clause (y) of the preceding sentence. Failure to give such notice within the
time provided or any defect therein shall not affect the legality or validity of
any such action.
7.2 Available Information. The Company shall promptly file with the
Warrant Agent copies of its annual reports and of the information, documents and
other reports (or copies of such portions of any of the foregoing as the
Commission may by rules and regulations prescribe) that the Company is required
to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act.
If the Company is not required to make such filings, the Company shall promptly
deliver to the Warrant Agent copies of any annual, quarterly or other reports
and financial statements that are generally provided to holders of equity or
debt securities of the Company (other than bank or similar institutional debt)
in their capacity as holders of such securities.
ARTICLE 8
RESERVATION OF STOCK
--------------------
The Company shall at all times reserve and keep available, free from
preemptive rights, out of its authorized but unissued Common Stock (or out of
authorized Other Securities), solely for issuance and delivery upon exercise of
Warrants, the full number of shares of Common Stock (and Other Securities) from
time to time issuable upon the exercise of all Warrants and any other
outstanding warrants, options or similar rights, from time to time outstanding.
All shares of Common Stock (and Other Securities) shall be duly authorized and,
when issued upon such exercise, shall be duly and validly issued, and (in the
case of shares) fully paid and nonassessable, and free from all taxes, liens,
charges, security interests, encumbrances and other restrictions created by or
through the Company.
ARTICLE 9
LOSS OR MUTILATION
------------------
Upon receipt by the Company and the Warrant Agent of evidence
reasonably satisfactory to them of the ownership of and the loss, theft,
destruction or mutilation of any Warrant Certificate and of an indemnity bond
reasonably satisfactory to them in form or amount, and (in the case of
15
mutilation) upon surrender and cancellation thereof, then, in the absence of
written notice to the Company or the Warrant Agent that the Warrants represented
thereby have been acquired by a bona fide purchaser, the Company shall execute
and deliver to the Warrant Agent and, upon the Company's request, an authorized
signatory of the Warrant Agent shall manually countersign and deliver, to the
registered holder of the lost, stolen, destroyed or mutilated Warrant
Certificate, in exchange for or in lieu thereof, a new Warrant Certificate of
the same tenor and for a like aggregate number of Warrants. Upon the issuance of
any new Warrant Certificate under this Article 9, the Company may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto and any other expenses (including the
reasonable fees and expenses of the Warrant Agent) in connection therewith.
Every new Warrant Certificate executed and delivered pursuant to this Article 9
in lieu of any lost, stolen or destroyed Warrant Certificate shall be entitled
to the same benefits of this Agreement equally and proportionately with any and
all other Warrant Certificates, whether or not the allegedly lost, stolen or
destroyed Warrant Certificate shall be at any time enforceable by anyone. The
provisions of this Article 9 are exclusive and shall preclude (to the extent
lawful) all other rights or remedies with respect to the replacement of
mutilated, lost, stolen or destroyed Warrant Certificates.
ARTICLE 10
WARRANT REGISTRATION
--------------------
10.1 Registration. The Warrant Certificates shall be issued in
registered form only and shall be registered in the names of the record holders
of the Warrant Certificates to whom they are to be delivered (any such delivery
to a registered holder of a Warrant will be at its last address as shown on the
register of the Company). The Warrant Agent shall maintain or cause to be
maintained a register in which, subject to such reasonable regulations as it may
prescribe, the Warrant Agent shall provide for the registration of Warrants and
of transfers or exchanges of Warrant Certificates as provided in this Agreement.
Such register shall be maintained at the office of the Warrant Agent located at
the respective address therefor as provided in Section 13.1. Such register shall
be open for inspection upon notice at all reasonable times by the Warrant Agent
and each holder of a Warrant.
10.2 Transfer or Exchange. At the option of the holder, Warrant
Certificates may be exchanged or transferred for other Warrant Certificates for
a like aggregate number of Warrants, upon surrender of the Warrant Certificates
to be exchanged at the office of the Warrant Agent maintained for such purpose
at the respective address therefor as provided in Section 13.1, and upon payment
of the taxes and charges herein provided. Whenever any Warrant Certificates are
so surrendered for exchange or transfer, the Company shall execute, and an
authorized signatory of the Warrant Agent shall manually countersign and
deliver, the Warrant Certificates that the holder making the exchange is
entitled to receive.
16
10.3 Valid and Enforceable. All Warrant Certificates issued upon any
registration of transfer or exchange of Warrant Certificates shall be the valid
obligations of the Company, evidencing the same obligations, and entitled to the
same benefits under this Agreement, as the Warrant Certificates surrendered for
such registration of transfer or exchange.
10.4 Endorsement. Every Warrant Certificate surrendered for
registration of transfer or exchange shall (if so required by the Company or the
Warrant Agent) be duly endorsed, or be accompanied by an instrument of transfer
in form reasonably satisfactory to the Company and the Warrant Agent and duly
executed by the registered holder thereof or such holder's officer or
representative duly authorized in writing.
10.5 No Service Charge. No service charge shall be made to the Warrant
Holder for any registration of transfer or exchange of Warrant Certificates.
10.6 Treatment of Holders of Warrant Certificates. The Company and the
Warrant Agent may treat the registered holder of a Warrant Certificate as the
absolute owner thereof for any purpose and as the Person entitled to exercise
the rights represented by the Warrants evidenced thereby, any notice to the
contrary notwithstanding.
10.7 Cancellation. Any Warrant Certificate surrendered for registration
of transfer, exchange or the exercise of the Warrants represented thereby shall,
if surrendered to the Company, be delivered to the Warrant Agent, and all
Warrant Certificates surrendered or so delivered to the Warrant Agent shall be
promptly cancelled by the Warrant Agent. Any such Warrant Certificate shall not
be reissued and, except as provided in this Article 10 in case of an exchange or
transfer, in Article 9 in case of a mutilated Warrant Certificate and in Article
4 in case of the exercise of less than all the Warrants represented thereby, no
Warrant Certificate shall be issued hereunder in lieu thereof. The Warrant Agent
shall deliver to the Company from time to time or otherwise dispose of such
cancelled Warrant Certificates in a manner reasonably satisfactory to the
Company.
ARTICLE 11
WARRANT AGENT
-------------
11.1 Obligations Binding. The Warrant Agent undertakes the duties and
obligations expressly imposed by this Agreement (and no implied duties or
obligations) upon the terms and conditions set forth in this Article 11. The
Company, and the holders of Warrants by their acceptance thereof, shall be bound
by all of such terms and conditions.
11.2 No Liability. The Warrant Agent shall not by countersigning
Warrant Certificates or by any other act hereunder be accountable with respect
to or be deemed to make any representations as to the validity or authorization
of the Warrants or the Warrant Certificates (except as to its countersignature
thereon), as to the validity, authorization or value (or kind or amount) of any
17
Common Stock or of any Other Securities or other property delivered or
deliverable upon exercise of any Warrant, or as to the purchase price of such
Common Stock, securities or other property. The Warrant Agent shall not (i) be
liable for any recital or statement of fact contained herein or in the Warrant
Certificates or for any action taken, suffered or omitted by the Warrant Agent
in good faith in the belief that any Warrant Certificate or any other document
or any signature is genuine or properly authorized, (ii) be responsible for
determining whether any facts exist that may require any adjustment of the
purchase price and the number of shares of Common Stock purchasable upon
exercise of Warrants, or with respect to the nature or extent of any such
adjustments when made, or with respect to the method of adjustment employed,
(iii) be responsible for any failure on the part of the Company to issue,
transfer or deliver any Common Stock or Other Securities or property upon the
surrender of any Warrant for the purpose of exercise or to comply with any other
of the Company's covenants and obligations contained in this Agreement or in the
Warrant Certificates or (iv) be liable for any action taken, suffered or omitted
to be taken in connection with this Agreement except for its own bad faith,
gross negligence or willful misconduct (each as finally determined by a final,
non-appealable order, judgment, decree or ruling of a court of competent
jurisdiction). Anything to the contrary notwithstanding, in no event shall the
Warrant Agent be liable for special, punitive, indirect, consequential or
incidental loss or damage of any kind whatsoever (including but not limited to
lost profits), even if the Warrant Agent has been advised of the likelihood of
such loss or damage. Any liability of the Warrant Agent under this Agreement
will be limited to the amount of fees paid by the Company to the Warrant Agent.
11.3 Instructions. The Warrant Agent is hereby authorized to accept
advice or instructions with respect to the performance of its duties hereunder
from the Chairman of the Board, Chief Executive Officer, President, any Senior
Vice President, any Vice President, Treasurer or any Assistant Treasurer of the
Company and to apply to any such officer for advice or instructions. The Warrant
Agent shall be fully protected and authorized in relying upon the most recent
advice or instructions received by any such officer. The Warrant Agent shall not
be liable for any action taken, suffered or omitted by it in accordance with the
advice or instructions of any such officer, except to the extent that it is
determined in a final judgment by a court of competent jurisdiction that such
action or omission resulted directly from the Warrant Agent's gross negligence.
11.4 Agents. The Warrant Agent may execute and exercise any of the
rights and powers hereby vested in it or perform any duty hereunder either
itself or by or through its attorneys, agents or employees, absent gross
negligence or willful misconduct (each as finally determined by a final,
non-appealable order, judgment, decree or ruling of a court of competent
jurisdiction) in the selection and in the continued employment of any such
attorney, agent or employee. The Warrant Agent shall not be under any obligation
or duty to institute, appear in, or defend any action, suit or legal proceeding
in respect hereof, but this provision shall not affect the power of the Warrant
Agent to take such action as the Warrant Agent may consider proper. The Warrant
Agent shall promptly notify the Company in writing of any claim made or action,
suit or proceeding instituted against the Warrant Agent arising out of or in
connection with this Agreement.
18
11.5 Cooperation. The Company will perform, execute, acknowledge and
deliver or cause to be performed, executed, acknowledged and delivered all such
further acts, instruments and assurances as may reasonably be required by the
Warrant Agent in order to enable the Warrant Agent to carry out or perform its
duties under this Agreement. Whenever in the performance of its duties hereunder
the Warrant Agent is unsure of or has questions as to what action it is required
to take under this Agreement, the Warrant Agent shall promptly seek
clarification thereof from the Company, and the Warrant Agent shall be fully
protected and incur no liability in not taking any such action prior to
receiving a written response from the Company.
11.6 Agent Only. The Warrant Agent shall act solely as agent for the
Company in accordance with the terms and conditions hereof. The Warrant Agent
shall not be liable except for the performance of such duties as are
specifically set forth herein, and no implied covenants or obligations shall be
read into this Agreement against the Warrant Agent, whose duties and obligations
shall be determined solely by the express provisions hereof.
11.7 Right to Counsel. The Warrant Agent may at any time consult with
legal counsel satisfactory to it (who may be legal counsel for the Company), and
the Warrant Agent shall incur no liability or responsibility to the Company or
to any Warrant holder for any action taken, suffered or omitted by the Warrant
Agent in good faith in accordance with the opinion or advice of such counsel.
11.8 Compensation. The Company agrees to pay the Warrant Agent
reasonable compensation for all services rendered by it hereunder and to
reimburse the Warrant Agent for its reasonable expenses and counsel fees and
other disbursements incurred in the preparation; delivery, amendment,
administration and execution of this Agreement and the exercise and performance
of its duties hereunder. The Company further agrees to indemnify the Warrant
Agent and hold it harmless against any and all liabilities, including, but not
limited to, any loss, damage, judgment, fine, penalty, claim, demand,
settlement, cost or expense (including, without limitation, reasonable counsel
fees), incurred without the Warrant Agent's bad faith, gross negligence or
willful misconduct (each as finally determined by a non-appealable order,
judgment, decree or ruling of a court of competent jurisdiction), for any action
taken, suffered or omitted by the Warrant Agent in connection with the
acceptance, administration, exercise and performance of its duties under this
Agreement and the Warrants, including the costs and expenses of defending
against any claim of liability in the premises. The indemnities provided herein
shall survive the termination of this Agreement, the termination and the
expiration of the Warrants, and the resignation or removal of the Warrant Agent.
The costs and expenses incurred in enforcing this right of indemnification shall
be paid by the Company.
11.9 Accounting. 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 on behalf of the Company on the
purchase of shares of Common Stock (or Other Securities) through the exercise of
Warrants. The Warrant Agent shall advise the Company by telephone at the end of
each day on which a payment for the exercise of Warrants is received of the
19
amount so deposited to such account. The Warrant Agent shall as soon as
practicable confirm such telephone advice to the Company in writing.
11.10 No Conflict. The Warrant Agent and any stockholder, affiliate,
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 Agreement. Nothing herein shall
preclude the Warrant Agent from acting in any other capacity for the Company or
for any other Person.
11.11 Resignation; Termination. The Warrant Agent may resign its duties
and be discharged from all further duties and liabilities hereunder (except
liabilities arising as a result of the Warrant Agent's bad faith, negligence or
willful misconduct) after giving thirty (30) days' prior written notice to the
Company. The Company may remove the Warrant Agent upon thirty (30) days' written
notice, and the Warrant Agent shall thereupon in like manner be discharged from
all further duties and liabilities hereunder, except as to liabilities arising
as a result of the Warrant Agent's bad faith, negligence or willful misconduct.
The Company shall cause to be mailed promptly (by first class mail, postage
prepaid) to each registered holder of a Warrant at such holder's last address as
shown on the register of the Company, at the Company's expense, a copy of such
notice of resignation or notice of removal, as the case may be. Upon such
resignation or removal the Company shall promptly appoint in writing a new
warrant agent. If the Company shall fail to make such appointment within a
period of thirty (30) days after it has been notified in writing of such
resignation by the resigning Warrant Agent or after such removal, then the
holder of any Warrant may apply to any court of competent jurisdiction for the
appointment of a new warrant agent. Pending appointment of a successor to the
Warrant Agent, either by the Company or by such a court, the duties of the
Warrant Agent shall be carried out by the Company. Any successor warrant agent,
whether appointed by the Company or by such a court, shall be (i) a Person,
incorporated under the laws of the United States or of any state thereof and
authorized under such laws to conduct shareholder services business, be subject
to supervision and examination by Federal or state authority, and have a
combined capital and surplus of not less than $50,000,000 as set forth in its
most recent published annual report of condition; or (ii) an affiliate of such a
Person described above. After acceptance in writing of such appointment by the
new warrant agent it shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named herein as the Warrant Agent,
without any further assurance, conveyance, act or deed; but if for any reason it
shall be necessary or expedient to execute and deliver any further assurance,
conveyance, act or deed, the same shall be done at the expense of the Company
and shall be legally and validly executed and delivered by the resigning or
removed Warrant Agent. Not later than the effective date of any such appointment
the Company shall file notice thereof with the resigning or removed Warrant
Agent and shall forthwith cause a copy of such notice to be mailed (by first
class, postage prepaid) to each registered holder of a Warrant at such holder's
last address as shown on the register of the Company. Failure to give any notice
provided for in this Section 11.11, or any defect in any such notice, shall not
20
affect the legality or validity of the resignation of the Warrant Agent or the
appointment of a new warrant agent, as the case may be.
11.12 Change of Warrant Agent. If 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 if 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 this Agreement.
11.13 Successor Warrant Agent. Any Person into which the Warrant Agent
or any new warrant agent may be merged or any Person resulting from any
consolidation to which the Warrant Agent or any new warrant agent shall be a
party or any Person succeeding to all or substantially all the agency business
of the Warrant Agent or any new warrant agent shall be a successor Warrant Agent
under this Agreement without any further act, provided that such Person would be
eligible for appointment as a new warrant agent under the provisions of Section
11.11 of this Article 11. The Company shall promptly cause the successor Warrant
Agent to mail notice of its succession as Warrant Agent (by first class mail,
postage prepaid) to each registered holder of a Warrant at its last address as
shown on the register of the Company.
ARTICLE 12
REMEDIES, ETC.
--------------
Prior to the exercise of the Warrants represented thereby, no holder of
a Warrant Certificate, as such, shall be entitled to any rights of a stockholder
of the Company, including, but not limited to, the right to vote, to receive
dividends or other distributions, to exercise any preemptive right or to receive
any notice of meetings of stockholders, and no such holder shall be entitled to
receive notice of any proceedings of the Company except as provided in this
Agreement. Nothing contained in this Agreement shall be construed as imposing
any liabilities on such holder to purchase any securities or as a stockholder of
the Company, whether such liabilities are asserted by the Company or by
creditors or stockholders of the Company or otherwise.
ARTICLE 13
MISCELLANEOUS
-------------
13.1 Notices. Any notice, demand or delivery authorized by this
Agreement shall be sufficiently given or made if sent by first class mail,
postage prepaid, delivered by hand or delivered by overnight courier, in each
case addressed to any registered holder of a Warrant at such holder's last known
address appearing on the register of the Company or the Warrant Agent, and to
the Company or the Warrant Agent as follows, or delivered by facsimile (in the
21
case of notices to any registered holder, to the last known facsimile number of
such holder appearing on the register of the Company or the Warrant Agent):
If to the Company:
Genesis Health Ventures, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: General Counsel
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Warrant Agent:
MELLON INVESTOR SERVICES LLC
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Relationship Manager and General Counsel
Telephone: (___) ___-______
Facsimile: (___) ___-______
or such other address as shall have been furnished in writing, in accordance
with this Section 13.1, to the party giving or making such notice, demand or
delivery.
13.2 Governing Law and Consent to Forum. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT
REGARD TO PRINCIPLES OF CONFLICT OF LAWS. THE COMPANY AND THE WARRANT AGENT EACH
HEREBY IRREVOCABLY SUBMIT TO THE JURISDICTION OF ANY NEW YORK STATE COURT
SITTING IN THE CITY OF NEW YORK OR ANY FEDERAL COURT SITTING IN THE CITY OF NEW
YORK IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT, AND EACH IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS
PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID
COURTS. NOTHING HEREIN SHALL AFFECT THE RIGHT OF ANY PERSON TO SERVE PROCESS IN
ANY MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE
PROCEED AGAINST THE COMPANY IN ANY OTHER JURISDICTION.
13.3 Benefits of this Agreement. This Agreement shall be binding upon
and inure to the benefit of the Company and the Warrant Agent and their
respective successors and assigns, and the registered and beneficial holders
from time to time of the Warrants and of holders of the Common Stock, where
applicable. Nothing in this Agreement is intended or shall be construed to
confer upon any other Person, any right, remedy or claim under or by reason of
this Agreement or any part hereof.
22
13.4 Agreement of Holders of Warrant Certificates. Every holder of a
Warrant Certificate, by accepting the same, covenants and agrees with the
Company, the Warrant Agent and with every other holder of a Warrant Certificate
that the Warrant Certificates are transferable on the registry books of the
Warrant Agent only upon the terms and conditions set forth in this Agreement,
and the Company and the Warrant Agent may deem and treat the Person in whose
name the Warrant Certificate is registered as the absolute owner for all
purposes whatsoever and neither the Company nor the Warrant Agent shall be
affected by any notice to the contrary.
13.5 Counterparts. This Agreement may be executed in any number of
counterparts and each such counterpart shall for all purposes be deemed to be an
original, and all such counterparts shall together constitute but one and the
same instrument.
13.6 Amendments. This Agreement may be amended by the parties hereto,
without the consent of the holder of any Warrant Certificate, for the purpose of
curing any manifest error, or of curing, correcting or supplementing any
defective provision contained herein, or making any other provisions with
respect to matters or questions arising under this Agreement as the Company and
the Warrant Agent may mutually deem necessary or desirable; provided, that such
action shall not adversely affect the interests of the holders of the Warrant
Certificates. Any other amendment shall require the consent of the holders of
Warrants representing a majority in number of the then outstanding Warrants.
Any such modification or amendment will be conclusive and binding on
all present and future holders of Warrant Certificates whether or not they have
consented to such modification or amendment or waiver and whether or not
notation of such modification or amendment is made upon such Warrant
Certificates. Any instrument given by or on behalf of any holder of a Warrant
Certificate in connection with any consent to any modification or amendment will
be conclusive and binding on all subsequent holders of such Warrant Certificate.
13.7 Consent to Jurisdiction. Notwithstanding anything to the contrary
contained in Section 13.2 hereof, (a) the parties hereby expressly acknowledge
and agree that, to the extent permitted by applicable law, the Bankruptcy Court
shall have exclusive jurisdiction to hear and determine any and all disputes
concerning the distribution of Warrants hereunder to holders of Claims pursuant
to the Plan, and (b) the Warrant Agent hereby consents to the jurisdiction of
the Bankruptcy Court with respect to any such disputes and waives any argument
of lack of such jurisdiction.
13.8 Headings. The table of contents hereto and the descriptive
headings of the several sections hereof are inserted for convenience only and
shall not control or affect the meaning or construction of any of the provisions
hereof.
23
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, as of the day and year first above written.
GENESIS HEALTH VENTURES, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------------
Title: Senior Vice President and Corporate Controller
----------------------------------------------
MELLON INVESTOR SERVICES LLC
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
------------------------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
------------------------------------------
Title: Assistant Vice President
-----------------------------------------
24
EXHIBIT A
FORM OF WARRANT CERTIFICATE
A-1
[FORM OF FACE OF WARRANT CERTIFICATE]
CUSIP No. ___________
Warrant No. 1 Number of Warrant(s): 4,559,475
--------------- ---------
Exercisable During the Period that Commences at 9:00 a.m., New York City time,
on October 2, 2001 and Terminates at 5:00 p.m., New York City
time, on October 2, 2002 except as provided below.
WARRANT TO PURCHASE
COMMON STOCK, PAR VALUE $.02 PER SHARE,
OF
GENESIS HEALTH VENTURES, INC.
This certifies that
or registered assigns, is the registered owner of the number of
warrants set forth above (the "Warrants"), each of which represents the right,
at any time after October 2, 2001 (the "Original Issue Date") and on or before
5:00 p.m., New York City time, on October 2, 2002 (the "Exercise Period"), to
purchase from Genesis Health Ventures, Inc., a Delaware corporation (the
"Company"), at the price per share of $20.33 (the "Exercise Price"), one share
of Common Stock, $.02 par value, of the Company as such stock was constituted as
of the Original Issue Date, subject to adjustment as provided in the Warrant
Agreement hereinafter referred to, upon surrender hereof, with the subscription
form on the reverse hereof duly executed, by hand or by mail to Mellon Investor
Services LLC, ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, or to any
successor thereto, as the warrant agent under the Warrant Agreement, at the
office of such successor maintained for such purpose (any such warrant agent
being herein called the "Warrant Agent") (or, if such exercise shall be in
connection with an underwritten public offering of shares of such Common Stock
(or Other Securities) (as such term and other capitalized terms used herein are
defined in the Warrant Agreement) subject to the Warrant Agreement, at the
location at which the Company shall have agreed to deliver such securities), and
simultaneous payment in full (by certified or official bank or bank cashier's
check payable to the order of the Company, or by wire transfer of immediately
available funds to an account designated by the Warrant Agent for the benefit of
the Company) of the Exercise Price in respect of each Warrant represented by
this Warrant Certificate that is so exercised, all subject to the terms and
conditions hereof and of the Warrant Agreement.
Upon any partial exercise of the Warrants represented by this Warrant
Certificate, there shall be issued to the holder hereof a new Warrant
Certificate representing the Warrants that were not exercised.
No fractional shares may be issued upon the exercise of rights to
purchase hereunder, and as to any fraction of a share otherwise issuable, the
Company will make a cash payment in lieu of such issuance, as provided in the
Warrant Agreement.
This Warrant Certificate is issued under and in accordance with a
Warrant Agreement, dated as of October 2, 2001 (the "Warrant Agreement"),
between the Company and Mellon Investor Services LLC, as Warrant Agent, and is
subject to the terms and provisions contained therein. The 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 Warrant Agent, the Company
and the registered holders of the Warrants. The holder of this Warrant
Certificate consents to all terms and provisions of the Warrant Agreement by
acceptance hereof. Copies of the Warrant Agreement are on file at the
above-mentioned office of the Warrant Agent and may be obtained by writing to
the Warrant Agent.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS WARRANT SET
FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES
HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.
This Warrant Certificate shall not be valid unless countersigned by the Warrant
Agent.
Dated : October 2, 2001
GENESIS HEALTH VENTURES, INC.
By:
---------------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Countersigned:
MELLON INVESTOR SERVICES LLC,
as Warrant Agent
By:
---------------------------------------------
Name:
----------------------------------
Title:
---------------------------------
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[FORM OF REVERSE OF WARRANT CERTIFICATE]
GENESIS HEALTH VENTURES, INC.
The transfer of this Warrant Certificate and all rights hereunder is
registrable by the registered holder hereof, in whole or in part, on the
register of the Company upon surrender of this Warrant Certificate at the office
or agency of the Company or the office of the Warrant Agent maintained for such
purpose at ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, duly endorsed
or accompanied by a written instrument of transfer duly executed and in form
satisfactory to the Company and the Warrant Agent, by the registered holder
hereof or his attorney duly authorized in writing and upon payment of any
necessary transfer tax or other governmental charge imposed upon such transfer
or registration thereof. Upon any partial transfer the Company will cause to be
delivered to such holder a new Warrant Certificate or Certificates with respect
to any portion not so transferred.
This Warrant Certificate may be exchanged at the office or agency of
the Company or the office of the Warrant Agent maintained for such purpose at ▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, attention: Compliance
Department, for Warrant Certificates representing the same aggregate number of
Warrants, each new Warrant Certificate to represent such number of Warrants as
the holder hereof shall designate at the time of such exchange.
Prior to the exercise of the Warrants represented hereby, the holder of
this Warrant Certificate, as such, shall not be entitled to any rights of a
stockholder of the Company, including, but not limited to, the right to vote, to
receive dividends or other distributions, to exercise any preemptive right or to
receive any notice of meetings of stockholders, and shall not be entitled to
receive notice of any proceedings of the Company except as provided in the
Warrant Agreement. Nothing contained herein shall be construed as imposing any
liabilities upon the holder of this Warrant Certificate to purchase any
securities or as a stockholder of the Company, whether such liabilities are
asserted by the Company or by creditors or stockholders of the Company or
otherwise.
This Warrant Certificate shall be void and all rights represented
hereby shall cease unless exercised before the close of business on October 2,
2002.
This Warrant Certificate shall not be valid for any purpose until it
shall have been manually countersigned by an authorized signatory of the Warrant
Agent.
Witness the facsimile seal of the Company and the signature of its duly
authorized officer.
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SUBSCRIPTION FORM
(To be executed only upon exercise of warrant)
TO GENESIS HEALTH VENTURES, INC.
Mellon Investor Services LLC, a New Jersey limited liability company,
as Warrant Agent
Attention: ____________________
The undersigned (i) irrevocably exercises ___ Warrants
represented by the within Warrant Certificate, (ii) purchases one share of
common stock, par value $.02 per share, of Genesis Health Ventures, Inc. (before
giving effect to the adjustments provided in the Warrant Agreement referred to
in the within Warrant Certificate) for each Warrant so exercised and herewith
makes payment in full of the purchase price of $20.33 per share, in respect of
each Warrant so exercised as provided in the Warrant Agreement (such payment
being by certified or official bank or bank cashier's check payable to the order
of Genesis Health Ventures, Inc., or by wire transfer of immediately available
funds to an account designated by the Warrant Agent for the benefit of Genesis
Health Ventures, Inc.), all on the terms and conditions specified in the within
Warrant Certificate and the Warrant Agreement, (iii) surrenders this Warrant
Certificate and all right, title and interest therein to Genesis Health
Ventures, Inc. and (iv) directs that the securities or other property
deliverable upon the exercise of such Warrants be registered or placed in the
name and at the address specified below and delivered thereto.
Dated: _________________ , 200_
--------------------------------------------
(Owner)*
--------------------------------------------
(Signature of Authorized Representative)
--------------------------------------------
(Street Address)
--------------------------------------------
(City) (State) (Zip Code)
4
Securities or property to be issued and delivered to:
--------------------------------------------
Signature Guaranteed**
Please insert social
security or other
identifying number
--------------------
Name
-------------------------------------------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------------------------------------
▇▇▇▇, ▇▇▇▇▇ and Zip Code
-----------------------------------------------------
*The signature must correspond with the name as written upon the face
of the within Warrant Certificate in every particular, without alteration or
enlargement or any change whatsoever.
**The signature must be guaranteed by a Securities Transfer Association
medallion program ("stamp") participant or an institution receiving prior
approval from the Warrant Agent.
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FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned registered holder of the
within Warrant Certificate hereby sells, assigns and transfers unto the Assignee
named below all of the rights of the undersigned under the within Warrant
Certificate, with respect to the number of warrants set forth below:
Name of Address No. of
Assignee ------- Warrants
-------- --------
Please insert social
security or other
identifying number
of Assignee
-------------------
and does hereby irrevocably constitute and appoint __________ attorney to make
such transfer on the books of Genesis Health Ventures, Inc. maintained for the
purpose, with full power of substitution in the premises.
Dated: ____________, 200_
Name *
----------------------------------------
Signature of Authorized
Representative
Signature Guaranteed **
-------------------------
* The signature must correspond with the name as written upon the face
of the within Warrant Certificate in every particular, without alteration or
enlargement or any change whatsoever.
** The signature must be guaranteed by a Securities Transfer
Association medallion program ("stamp") participant or an institution receiving
prior approval from the Warrant Agent.
6