EXHIBIT 4.5
-------------------------------------------------------------------------------
WARRANT AGREEMENT
Dated as of December 12, 1997
Between
AMERICAN BANKNOTE CORPORATION,
and
THE BANK OF NEW YORK
as Warrant Agent
-----------------
Warrants to Purchase Common Stock
Par Value $0.01 Per Share
-------------------------------------------------------------------------------
TABLE OF CONTENTS
Page
ARTICLE I ISSUANCE, FORM, EXECUTION, DELIVERY AND
REGISTRATION OF WARRANT CERTIFICATES
SECTION 1.01. Issuance of Warrants..........................................2
SECTION 1.02. Form of Warrant Certificates..................................2
SECTION 1.03. Execution of Warrant Certificates.............................3
SECTION 1.04. Countersignature and Delivery.................................3
SECTION 1.05. Temporary Warrant Certificates................................4
SECTION 1.06. Separation of Warrants and Notes..............................5
SECTION 1.07. Registration..................................................5
SECTION 1.08. Registration of Transfers or Exchanges........................6
SECTION 1.09. Lost, Stolen, Destroyed, Defaced or Mutilated Warrant
Certificates...............................................12
SECTION 1.10. Offices for Exercise, etc....................................13
ARTICLE II DURATION, EXERCISE OF WARRANTS; EXERCISE PRICE
AND REPURCHASE OF WARRANTS
SECTION 2.01. Duration of Warrants.........................................14
SECTION 2.02. Exercise, Exercise Price, Settlement and Delivery............15
SECTION 2.03. Cancellation of Warrant Certificates.........................18
ARTICLE III OTHER PROVISIONS RELATING TO RIGHTS OF
HOLDERS OF WARRANTS
SECTION 3.01. Enforcement of Rights........................................18
SECTION 3.02. Obtaining Stock Exchange Listings............................18
ARTICLE IV CERTAIN COVENANTS OF THE COMPANY
SECTION 4.01. Payment of Taxes.............................................19
SECTION 4.02. Reservation of Warrant Shares................................19
SECTION 4.03. Obtaining of Governmental Approvals..........................19
ARTICLE V ADJUSTMENTS
SECTION 5.01. Adjustment of Exercise Rate; Notices.........................20
SECTION 5.02. Fractional Shares............................................27
SECTION 5.03. Certain Distributions........................................28
-i-
ARTICLE VI CONCERNING THE WARRANT AGENT
SECTION 6.01. Warrant Agent................................................28
SECTION 6.02. Conditions of Warrant Agent's Obligations....................28
SECTION 6.03. Resignation and Appointment of Successor.....................33
ARTICLE VII REGISTRATION
SECTION 7.01. Shelf Registration............................................35
SECTION 7.02. Effectiveness Period..........................................36
SECTION 7.03. Registration Procedures.......................................37
ARTICLE VIII MISCELLANEOUS
SECTION 8.01. Amendment....................................................42
SECTION 8.02. Notices and Demands to the Company and Warrant Agent.........43
SECTION 8.03. Addresses for Notices to Parties and for Transmission of
Documents..................................................43
SECTION 8.04. Notices to Holders...........................................43
SECTION 8.05. Applicable Law; Submission to Jurisdiction...................44
SECTION 8.06. Persons Having Rights Under Agreement........................44
SECTION 8.07. Headings.....................................................44
SECTION 8.08. Counterparts.................................................44
SECTION 8.09. Inspection of Agreement......................................44
SECTION 8.10. Availability of Equitable Remedies...........................44
SECTION 8.11. Obtaining of Governmental Approvals..........................45
EXHIBIT A - Form of Warrant Certificate.................................A-1
EXHIBIT B - Form of Legend for Global Warrant...........................B-1
EXHIBIT C - Certificate To Be Delivered upon Exchange or Registration
of Transfer of Warrants...................................C-1
EXHIBIT D - Form of Transferee Certificate for Institutional Accredited
Investors.................................................D-1
EXHIBIT E - Form of Transferee Certificate for Regulation S Transfers...E-1
-ii-
INDEX OF DEFINED TERMS
Defined Term Section
------------ -------
Affiliate.................................................... 5.01(b)
Agreement.................................................... Recitals
Black Out Period............................................. 7.02
Business Day................................................. 2.01
Capital Stock................................................ 5.01(l)
Cashless Exercise............................................ 2.02(c)
Cashless Exercise Ratio...................................... 2.02(c)
Common Stock................................................. Recitals
Commission................................................... 7.01(a)
Company...................................................... Recitals
control...................................................... 5.01(b)
controlled by................................................ 5.01(b)
controlling.................................................. 5.01(b)
controlling person........................................... 7.03(o)
Current Market Value......................................... 5.01(l)
Definitive Warrants.......................................... 1.02
Distribution................................................. 5.03
Distribution Rights.......................................... 5.03
Election to Exercise......................................... 2.02(b)
Exercise Date................................................ 2.02(d)
Exercise Price............................................... 2.02(a)
Exercise Rate................................................ 2.02(a)
Expiration Date.............................................. 2.01
Fundamental Transaction...................................... 5.01(d)
Global Shares................................................ 2.02(f)
Global Warrants.............................................. 1.02
Guarantors................................................... Recitals
Indemnified Person........................................... 7.03(o)
Indenture.................................................... Recitals
Independent Financial Expert................................. 5.01(1)
Initial Purchasers........................................... Recitals
Institutional Accredited Investor............................ 1.08(a)
Issue Date 1.01
Liquidated Damages........................................... 7.04
NASD......................................................... 7.03(m)
Notes........................................................ Recitals
Officers' Certificate........................................ 1.08(d)
Private Placement Legend..................................... 1.08(g)
Purchase Agreement........................................... Recitals
QIB.......................................................... 1.08(a)
Registrar.................................................... 1.07
-iii-
Defined Term Section
------------ -------
Registration Default......................................... 7.04
Registration Statements...................................... 7.01(a)
Related Parties.............................................. 6.02(e)
Requisite Warrant Holders.................................... 8.01
Resale Restriction Termination Date.......................... 1.08
Securities Act............................................... 1.06, 7.01(a)
Separability Date............................................ 1.06
Separation................................................... 1.06
Shelf Registration........................................... 7.01(a)
Surviving Person............................................. 5.01(d)
Time of Determination........................................ 5.01(1)
Trustee...................................................... Recitals
under common control with.................................... 5.01(a)
Units........................................................ Recitals
Warrant Agent................................................ Recitals
Warrant Agent Office......................................... 1.10
Warrant Certificates......................................... Recitals
Warrant Exercise Office...................................... 2.02(b)
Warrant Register............................................. 1.07
Warrant Registration Statement............................... 7.01(a)
Warrant Shares............................................... 1.01
Warrants..................................................... Recitals
-iv-
WARRANT AGREEMENT
WARRANT AGREEMENT ("Agreement"), dated as of December 12, 1997 between
AMERICAN BANKNOTE CORPORATION (together with any successor thereto, the
"Company") and THE BANK OF NEW YORK, as warrant agent (with any successor
Warrant Agent, the "Warrant Agent").
WHEREAS, the Company and the Guarantors named therein (the "Guarantors")
have entered into a purchase agreement (the "Purchase Agreement") dated December
5, 1997 with Chase Securities Inc., Bear, ▇▇▇▇▇▇▇ & Co. Inc., NationsBanc
▇▇▇▇▇▇▇▇▇▇ Securities, Inc. and Societe Generale Securities Corporation
(collectively, the "Initial Purchasers") in which the Company has agreed to sell
to the Initial Purchasers 95,000 units (the "Units") consisting in the aggregate
of (i) $95,000,000 aggregate principal amount of Senior Subordinated Notes due
2007 (the "Notes") of the Company to be issued under an indenture dated as of
December 12, 1997 (the "Indenture"), between the Company and The Bank of New
York, as trustee (in such capacity, the "Trustee"), and (ii) 95,000 Warrants
(the "Warrants"), each Warrant initially entitling the holder thereof to
purchase 12.482 shares of common stock, par value $0.01 per share (the "Common
Stock"), of the Company. The certificates evidencing the Warrants are herein
referred to collectively as the "Warrant Certificates;" and
WHEREAS, each Unit will consist of one Note in the principal amount of
$1,000 and one Warrant to purchase 12.482 shares of common stock; the Notes and
the Warrants comprising part of the Units shall not be separately transferable
until the Separability Date (as defined below); and
WHEREAS, the Company desires the Warrant Agent, as warrant agent, to assist
the Company in connection with the issuance, exchange, cancellation, replacement
and exercise of the Warrants, and in this Agreement wishes to set forth, among
other things, the terms and conditions on which the Warrants may be issued,
exchanged, cancelled, replaced and exercised;
NOW, THEREFORE, the parties hereto agree as follows:
-2-
ARTICLE I
ISSUANCE, FORM, EXECUTION, DELIVERY AND
REGISTRATION OF WARRANT CERTIFICATES
SECTION 1.01. Issuance of Warrants. Warrants comprising part of the Units
shall be originally issued on December 12, 1997 (the "Issue Date") in connection
with the issuance of the Units and such Warrants shall not be separately
transferable from the Notes until on or after the Separability Date as provided
in Section 1.06 hereof.
Each Warrant Certificate shall evidence the number of Warrants specified
therein, and each Warrant evidenced thereby shall, when exercisable as provided
herein and therein, represent the right, subject to the provisions contained
herein and therein, to purchase from the Company (and the Company shall issue
and sell to the holder of such Warrant) one fully paid, registered and
nonassessable share of Common Stock at an exercise price of $5.50 per share. The
number of Shares issuable upon exercise of a Warrant is subject to adjustment as
provided herein and in the Warrant. The shares purchasable upon exercise of a
Warrant are hereinafter referred to as the "Warrant Shares" and, unless the
context otherwise requires, such term shall also include any other securities or
property purchasable and deliverable upon exercise of a Warrant as provided in
Article V, subject to adjustment as provided herein and in the Warrant.
SECTION 1.02. Form of Warrant Certificates. The Warrant Certificates will
initially be issued either in global form (the "Global Warrants"), substantially
in the form of Exhibit A hereto, or in registered form as definitive Warrant
Certificates (the "Definitive Warrants") substantially in the form of Exhibit A
attached hereto. Any Global Warrants to be delivered pursuant to this Agreement
shall bear the legend set forth in Exhibit B attached hereto. Such Global
Warrants shall represent such of the outstanding Warrants as shall be specified
therein and each shall provide that it shall represent the aggregate amount of
outstanding Warrants from time to time endorsed thereon and that the aggregate
amount of outstanding Warrants represented thereby may from time to time be
reduced or increased, as appropriate. Any endorsement of a Global Warrant to
reflect the amount of any increase or decrease in the amount of outstanding
Warrants represented thereby shall be made by the Warrant Agent and the
Depositary (as defined below) in accordance with instructions given by the
holder thereof. The Depository Trust Company shall act as the Depositary with
-3-
respect to the Global Warrants until a successor shall be appointed by the
Company and the Warrant Agent. Upon written request, a holder of Warrants may
receive from the Warrant Agent or the Depositary Definitive Warrants as set
forth in Section 1.08 hereof.
SECTION 1.03. Execution of Warrant Certificates. The Warrant Certificates
shall be executed on behalf of the Company by the Chairman of its Board of
Directors, its President or any Vice President and attested by its Secretary or
Assistant Secretary. Such signatures may be the manual or facsimile signatures
of the present or any future such officers. Typographical and other minor errors
or defects in any such reproduction of any such signature shall not affect the
validity or enforceability of any Warrant Certificate that has been duly
countersigned and delivered by the Warrant Agent.
In case any officer of the Company who shall have signed any of the Warrant
Certificates shall cease to be such officer before the Warrant Certificate so
signed shall be countersigned and delivered by the Warrant Agent or disposed of
by the Company, such Warrant Certificate nevertheless may be countersigned and
delivered or disposed of as though the person who signed such Warrant
Certificate had not ceased to be such officer of the Company; and any Warrant
Certificate may be signed on behalf of the Company by such persons as, at the
actual date of the execution of such Warrant Certificate, shall be the proper
officers of the Company, although at the date of the execution and delivery of
this Agreement any such person was not such an officer.
SECTION 1.04. Countersignature and Delivery. Subject to the immediately
following paragraph, Warrant Certificates shall be countersigned by manual
signature and dated the date of countersignature by the Warrant Agent and shall
not be valid for any purpose unless so countersigned and dated. The Warrant
Certificates shall be numbered and shall be registered in the Warrant Register
(as defined in Section 1.07 hereof).
Upon the receipt by the Warrant Agent of a written order of the Company,
which order shall be signed by the Chairman of its Board of Directors, its
President or any Vice President and attested by its Secretary or Assistant
Secretary, and shall specify the amount of Warrants to be authenticated, whether
the Warrants are to be Global Warrants or Definitive Warrants, the date of such
Warrants and such other information as the Warrant Agent may reasonably request,
without any further action by the Company, the Warrant Agent is authorized,
-4-
upon receipt from the Company at any time and from time to time of the Warrant
Certificates, duly executed as provided in Section 1.03 hereof, to countersign
the Warrant Certificates and upon the holder's request to make them available
for delivery. Such countersignature shall be by a duly authorized signatory of
the Warrant Agent (although it shall not be necessary for the same signatory to
sign all Warrant Certificates).
In case any authorized signatory of the Warrant Agent who shall have
countersigned any of the Warrant Certificates shall cease to be such authorized
signatory before the Warrant Certificate shall be disposed of by the Company or
the Warrant Agent, such Warrant Certificate nevertheless may be delivered or
disposed of as though the person who countersigned such Warrant Certificate had
not ceased to be such authorized signatory of the Warrant Agent; and any Warrant
Certificate may be countersigned on behalf of the Warrant Agent by such persons
as, at the actual time of authentication of such Warrant Certificates, shall be
the duly authorized signatories of the Warrant Agent, although at the time of
the execution and delivery of this Agreement any such person is not such an
authorized signatory.
The Warrant Agent's countersignature on all Warrant Certificates shall be
in substantially the form set forth in Exhibit A hereto.
SECTION 1.05. Temporary Warrant Certificates. Pending the preparation of
definitive Warrant Certificates, the Company may execute, and the Warrant Agent
shall authenticate and deliver, temporary Warrant Certificates, which are
printed, lithographed, typewritten or otherwise produced, substantially of the
tenor of the definitive Warrant Certificates in lieu of which they are issued
and with such appropriate insertions, omissions, substitutions and other
variations as the officers executing such Warrant Certificates may determine, as
evidenced by their execution of such Warrant Certificates.
If temporary Warrant Certificates are issued, the Company will cause
definitive Warrant Certificates to be prepared without unreasonable delay. After
the preparation of definitive Warrant Certificates, the temporary Warrant
Certificates shall be exchangeable for definitive Warrant Certificates upon
surrender of the temporary Warrant Certificates at any office or agency
maintained by the Company for that purpose pursuant to Section 1.10 hereof.
Subject to the provisions of Section 4.01 hereof, such exchange shall be without
charge to the holder. Upon surrender for cancellation of any one or more
temporary Warrant Certificates, the Company shall execute, and
-5-
the Warrant Agent shall countersign and make available for delivery in exchange
therefor, one or more definitive Warrant Certificates representing in the
aggregate a like number of Warrants. Until so exchanged, the holder of a
temporary Warrant Certificate shall in all respects be entitled to the same
benefits under this Agreement as a holder of a definitive Warrant Certificate.
SECTION 1.06. Separation of Warrants and Notes. The Notes and the Warrants
will not be separately transferable until the Separability Date. "Separability
Date" shall mean the earliest to occur of (i) June 10, 1998, (ii) the date on
which a registration statement under the Securities Act of 1933, as amended (the
"Securities Act"), with respect to a registered exchange offer for the Notes or
covering the sale by holders of the Notes is declared effective under the
Securities Act and (iii) such earlier date as may be determined by Chase
Securities Inc. in its sole discretion and specified to the Company, the
Trustee, the Warrant Agent and the Unit Agent in writing. The separation of the
Warrants and the Notes is herein referred to as a "Separation."
SECTION 1.07. Registration. The Company will keep, at the office or agency
maintained by the Company for such purpose, a register or registers in which,
subject to such reasonable regulations as it may prescribe, the Company shall
provide for the registration of, and registration of transfer and exchange of,
Warrants as provided in this Article. Each person designated by the Company from
time to time as a person authorized to register the transfer and exchange of the
Warrants is hereinafter called, individually and collectively, the "Registrar."
The Company hereby initially appoints the Warrant Agent as Registrar. Upon
written notice to the Warrant Agent and any acting Registrar, the Company may
appoint a successor Registrar for such purposes.
The Company will at all times designate one person (who may be the Company
and who need not be a Registrar) to act as repository of a master list of names
and addresses of the holders of Warrants (the "Warrant Register"). The Warrant
Agent will act as such repository unless and until some other person is, by
written notice from the Company to the Warrant Agent and the Registrar,
designated by the Company to act as such. The Company shall cause each Registrar
to furnish to such repository, on a current basis, such information as to all
registrations of transfer and exchanges effected by such Registrar, as may be
necessary to enable such repository to maintain the Warrant Register on as
current a basis as is practicable.
-6-
SECTION 1.08. Registration of Transfers or Exchanges.
(a) Transfer or Exchange of Definitive Warrants. When Definitive Warrants
are presented to the Warrant Agent with a request from the holder:
(i) to register the transfer of the Definitive Warrants; or
(ii) to exchange such Definitive Warrants for an equal number of
Definitive Warrants of other authorized denominations,
the Warrant Agent shall register the transfer or make the exchange as requested
if the requirements under this Warrant Agreement as set forth in this Section
1.08 hereof for such transactions are met; provided, however, that the
Definitive Warrants presented or surrendered by a holder for registration of
transfer or exchange:
(x) shall be duly endorsed or accompanied by a written instruction of
transfer or exchange in form satisfactory to the Company and the
Warrant Agent, duly executed by such holder or by his attorney, duly
authorized in writing; and
(y) in the case of Warrants the offer and sale of which have not been
registered under the Securities Act and are presented for transfer or
exchange prior to (X) the date that is two years (or such shorter
period as may be prescribed by Rule 144(k) (or any successor provision
thereto)) after the later of the date of original issuance of the
Warrants and the last date on which the Company or any affiliate of
the Company was the owner of such Warrants, or any predecessor
thereto, and (Y) such later date, if any, as may be required by any
subsequent change in applicable law (the "Resale Restriction
Termination Date"), such Warrants shall be accompanied by the
following additional information and documents, as applicable:
(A) if such Warrants are being delivered to the Warrant Agent by a
holder for registration in the name of such holder, without
transfer, a certification from such holder to that effect (in
substantially the form of Exhibit C hereto); or
-7-
(B) if such Warrants are being transferred to a qualified
institutional buyer (as defined in Rule 144A under the Securities
Act) (a "QIB") in accordance with Rule 144A under the Securities
Act, a certification from the transferor to that effect (in
substantially the form of Exhibit C hereto); or
(C) if such Warrants are being transferred to an institutional
"accredited investor" within the meaning of subparagraphs (a)(1),
(a)(2), (a)(3) or (a)(7) of Rule 501 under the Securities Act (an
"Institutional Accredited Investor"), delivery by the transferor
of a certification to that effect (in substantially the form of
Exhibit C hereto), and delivery by the proposed transferee of a
Transferee Certificate for Institutional Accredited Investors (in
substantially the form of Exhibit D hereto); or
(D) if such Warrants are being transferred in reliance on Regulation
S under the Securities Act, delivery by the transferor of a
certification to that effect (in substantially the form of
Exhibit C hereto), and a Certificate for Regulation S Transfers
in the form of Exhibit E hereto; or
(E) if such Warrants are being transferred in reliance on Rule 144
under the Securities Act, delivery by the transferor of a
certification from the transferor to that effect (in
substantially the form of Exhibit C hereto), and an opinion of
counsel reasonably satisfactory to the Company to the effect that
such transfer is in compliance with the Securities Act; or
(F) if such Warrants are being transferred in reliance on another
exemption from the registration requirements of the Securities
Act, a certification from the transferor to that effect (in
substantially the form of Exhibit C hereto) and an opinion of
counsel reasonably satisfactory to the Company to the effect that
such transfer is in compliance with the Securities Act; provided
that the Company may, based upon the views of its own counsel,
instruct the Warrant Agent not to register such transfer in any
case where the
-8-
proposed transferee is not a QIB, Non-U.S. Person or
Institutional Accredited Investor.
(b) Restrictions on Transfer of a Definitive Warrant for a Beneficial
Interest in a Global Warrant. A Definitive Warrant may not be transferred by a
holder for a beneficial interest in a Global Warrant except upon satisfaction of
the requirements set forth below. Upon receipt by the Warrant Agent of a
Definitive Warrant, duly endorsed or accompanied by appropriate instruments of
transfer, in form satisfactory to the Warrant Agent, together with:
(A) certification from such holder (in substantially the form of
Exhibit C hereto) that such Definitive Warrant is being
transferred to a QIB in accordance with Rule 144A under the
Securities Act; and
(B) written instructions directing the Warrant Agent to make, or to
direct the Depositary to make, an endorsement on the Global
Warrant to reflect an increase in the aggregate amount of the
Warrants represented by the Global Warrant,
then the Warrant Agent shall cancel such Definitive Warrant and cause, or direct
the Depositary to cause, in accordance with the standing instructions and
procedures existing between the Depositary and the Warrant Agent, the number of
Shares represented by the Global Warrant to be increased accordingly. If no
Global Warrant is then outstanding, the Company shall issue and the Warrant
Agent shall upon written instructions from the Company countersign a new Global
Warrant in the appropriate amount.
(c) Transfer or Exchange of Global Warrants. The transfer or exchange of
Global Warrants or beneficial interests therein shall be effected through the
Depositary, in accordance with this Section 1.08, the Private Placement Legend,
this Agreement (including the restrictions on transfer set forth herein) and the
procedures of the Depositary therefor.
(d) Transfer or Exchange of a Beneficial Interest in a Global Warrant for a
Definitive Warrant.
(i) Any person having a beneficial interest in a Global Warrant may
transfer or exchange such beneficial interest for a Definitive Warrant upon
receipt by the Warrant Agent of written instructions or such
-9-
other form of instructions as is customary for the Depositary from the
Depositary or its nominee on behalf of any person having a beneficial
interest in a Global Warrant, including a written order containing
registration instructions and, in the case of any such transfer or exchange
prior to the Resale Restriction Termination Date, the following additional
information and documents:
(A) if such beneficial interest is being transferred to the person
designated by the Depositary as being the beneficial owner, a
certification from such person to that effect (in substantially
the form of Exhibit C hereto); or
(B) if such beneficial interest is being transferred to a QIB in
accordance with Rule 144A under the Securities Act, a
certification from the transferor to that effect (in
substantially the form of Exhibit C hereto); or
(C) if such beneficial interest is being transferred to an
Institutional Accredited Investor, delivery by the transferor of
a certification to that effect (in substantially the form of
Exhibit C hereto), and delivery by the proposed transferee of a
Transferee Certificate for Institutional Accredited Investors (in
substantially the form of Exhibit D hereto); or
(D) if such beneficial interest is being transferred in reliance on
Regulation S under the Securities Act, delivery by the transferor
of a certification to that effect (in substantially in the form
of Exhibit C hereto), and a Certificate for Regulation S
Transfers in the form of Exhibit E hereto; or
(E) if such beneficial interest is being transferred in reliance on
Rule 144 under the Securities Act, delivery by the transferor of
a certification to that effect (in substantially the form of
Exhibit C hereto), and an opinion of counsel reasonably
satisfactory to the Company to the effect that such transfer is
in compliance with the Securities Act; or
-10-
(F) if such beneficial interest is being transferred in reliance on
another exemption from the registration requirements of the
Securities Act, a certification from the transferor to that
effect (in substantially the form of Exhibit C hereto) and an
opinion of counsel reasonably satisfactory to the Company to the
effect that such transfer is in compliance with the Securities
Act; provided that the Company may instruct the Warrant Agent not
to register such transfer in any case where the proposed
transferee is not a QIB, Non-U.S. Person or Institutional
Accredited Investor.
then the Warrant Agent will cause, in accordance with the
standing instructions and procedures existing between the
Depositary and the Warrant Agent, the aggregate amount of the
Global Warrant to be reduced and, following such reduction, the
Company will execute and, upon receipt of an authentication order
in the form of an officers' certificate (a certificate signed by
two officers of such company, one of whom must be the principal
executive officer, principal financial officer or principal
accounting officer) (an "Officers' Certificate"), the Warrant
Agent will authenticate and deliver to the transferee a
Definitive Warrant.
(ii) Definitive Warrants issued in exchange for a beneficial
interest in a Global Warrant pursuant to this Section 1.08(d) shall be
registered in such names and in such authorized denominations as the
Depositary, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Warrant Agent in
writing. The Warrant Agent shall deliver such Definitive Warrants to
the persons in whose names such Warrants are so registered and adjust
the Global Warrant pursuant to paragraph (h) of this Section 1.08.
(e) Restrictions on Transfer or Exchange of Global Warrants.
Notwithstanding any other provisions of this Agreement (other than the
provisions set forth in subsection (f) of this Section 1.08), a Global Warrant
may not be transferred or exchanged as a whole except by the Depositary to a
nominee of the Depositary or by a nominee of the Depositary to the Depositary or
another nominee of the Depositary or by the Depositary
-11-
or any such nominee to a successor Depositary or a nominee of such successor
Depositary.
(f) Countersignature of Definitive Warrants in Absence of Depositary. If at
any time:
(i) the Depositary for the Global Warrants notifies the Company
that the Depositary is unwilling or unable to continue as Depositary
for the Global Warrant and a successor Depositary for the Global
Warrant is not appointed by the Company within 90 days after delivery
of such notice; or
(ii) the Company, at its sole discretion, notifies the Warrant
Agent in writing that it elects to cause the issuance of Definitive
Warrants for all Global Warrants under this Agreement,
then the Company will execute, and the Warrant Agent will, upon receipt of an
Officers' Certificate requesting the countersignature and delivery of Definitive
Warrants, countersign and make available for delivery Definitive Warrants, in an
aggregate number equal to the aggregate number of warrants represented by the
Global Warrant, in exchange for such Global Warrant.
(g) Private Placement Legend. Upon the registration of transfer, exchange
or replacement of Warrant Certificates not bearing the legend set forth in
Exhibit A attached hereto (the "Private Placement Legend"), the Warrant Agent
shall make available for delivery Warrant Certificates that do not bear the
Private Placement Legend. Upon the registration of transfer, exchange or
replacement of Warrant Certificates bearing the Private Placement Legend, the
Warrant Agent shall make available for delivery Warrant Certificates that bear
the Private Placement Legend unless, and the Warrant Agent is hereby authorized
to make available for delivery Warrant Certificates without the Private
Placement Legend if, (i) the requested transfer is not prior to the date that is
two years (or such shorter period as may be prescribed by Rule 144(k) (or any
successor provision thereto) under the Securities Act or any successor provision
thereunder) after the later of the original Issue Date of the Warrants or the
last day on which the Company or any of its Affiliates was the owner of the
Warrant or any predecessor security, (ii) there is delivered to the Warrant
Agent an opinion of counsel reasonably satisfactory to the Company and the
Warrant Agent to the effect that neither such legend nor the related
restrictions on transfer are required in
-12-
order to maintain compliance with the provisions of the Securities Act or (iii)
the Warrants to be transferred or exchanged represented by such Warrant
Certificates are being transferred or exchanged pursuant to an effective
registration statement under the Securities Act.
(h) Cancellation or Adjustment of a Global Warrant. At such time as all
beneficial interests in a Global Warrant have either been exchanged for
Definitive Warrants, redeemed, repurchased or cancelled, such Global Warrant
shall be returned to the Company or, upon written order to the Warrant Agent in
the form of an Officers' Certificate from the Company, retained and cancelled by
the Warrant Agent. At any time prior to such cancellation, if any beneficial
interest in a Global Warrant is exchanged for Definitive Warrants, redeemed,
repurchased or cancelled, the number of Warrants represented by such Global
Warrant shall be reduced and an endorsement shall be made on such Global Warrant
by the Warrant Agent to reflect such reduction.
(i) Obligations with Respect to Transfers or Exchanges of Definitive
Warrants.
(i) To permit registrations of transfers or exchanges, the
Company shall execute, at the Warrant Agent's request, and the Warrant
Agent shall authenticate Definitive Warrants and Global Warrants.
(ii) All Definitive Warrants and Global Warrants issued upon any
registration, transfer or exchange of Definitive Warrants or Global
Warrants shall be the valid obligations of the Company, entitled to
the same benefits under this Warrant Agreement as the Definitive
Warrants or Global Warrants surrendered upon the registration of
transfer or exchange.
(iii) Prior to due presentment for registration of transfer of
any Warrant, the Warrant Agent and the Company may deem and treat the
person in whose name any Warrant is registered as the absolute owner
of such Warrant, and neither the Warrant Agent nor the Company shall
be affected by notice to the contrary.
SECTION 1.09. Lost, Stolen, Destroyed, Defaced or Mutilated Warrant
Certificates. Upon receipt by the Company and the Warrant Agent (or any agent of
the Company or the Warrant Agent, if requested by the Company) of evidence
satisfactory to them of the loss, theft, destruction, defacement or mu-
-13-
tilation of any Warrant Certificate and of an indemnity bond satisfactory to
them and, in the case of mutilation or defacement, upon surrender thereof to the
Warrant Agent for cancellation, then, in the absence of notice to the Company or
the Warrant Agent that such Warrant Certificate has been acquired by a bona fide
purchaser or holder in due course, the Company shall execute, and an authorized
signatory of the Warrant Agent shall manually countersign and make available for
delivery, in exchange for or in lieu of the lost, stolen, destroyed, defaced or
mutilated Warrant Certificate, a new Warrant Certificate representing a like
number of Warrants, bearing a number or other distinguishing symbol not
contemporaneously outstanding. Upon the issuance of any new Warrant Certificate
under this Section in a name other than the prior registered holder of the lost,
stolen, destroyed, defaced or mutilated Warrant Certificate, the Company may
require the payment from the holder of such Warrant Certificate of a sum
sufficient to cover any tax, stamp tax or other governmental charge that may be
imposed in relation thereto and any other expenses (including the fees and
expenses of the Warrant Agent and the Registrar) in connection therewith. Every
substitute Warrant Certificate executed and delivered pursuant to this Section
in lieu of any lost, stolen or destroyed Warrant Certificate shall constitute an
additional contractual obligation of the Company, whether or not the lost,
stolen or destroyed Warrant Certificate shall be at any time enforceable by
anyone, and shall be entitled to the benefits of (but shall be subject to all
the limitations of rights set forth in) this Agreement equally and
proportionately with any and all other Warrant Certificates duly executed and
delivered hereunder. The provisions of this Section 1.09 are exclusive with
respect to the replacement of lost, stolen, destroyed, defaced or mutilated
Warrant Certificates and shall preclude (to the extent lawful) any and all other
rights or remedies notwithstanding any law or statute existing or hereafter
enacted to the contrary with respect to the replacement of lost, stolen,
destroyed, defaced or mutilated Warrant Certificates.
The Warrant Agent is hereby authorized to countersign in accordance with
the provisions of this Agreement, and make available for delivery the new
Warrant Certificates required pursuant to the provisions of this Section.
SECTION 1.10. Offices for Exercise, etc. So long as any of the Warrants
remain outstanding, the Company will designate and maintain in the Borough of
Manhattan, The City of New York: (a) an office or agency where the Warrant
Certificates may be presented for exercise, (b) an office or agency where the
Warrant Certificates may be presented for registration of
-14-
transfer and for exchange (including the exchange of temporary Warrant
Certificates for definitive Warrant Certificates pursuant to Section 1.05
hereof) and (c) an office or agency where notices and demands to or upon the
Company in respect of the Warrants or of this Agreement may be served. The
Company may from time to time change or rescind such designation, as it may deem
desirable or expedient; provided, however, that an office or agency shall at all
times be maintained in the Borough of Manhattan, The City of New York, as
provided in the first sentence of this Section. In addition to such office or
offices or agency or agencies, the Company may from time to time designate and
maintain one or more additional offices or agencies within or outside The City
of New York, where Warrant Certificates may be presented for exercise or for
registration of transfer or for exchange, and the Company may from time to time
change or rescind such designation, as it may deem desirable or expedient. The
Company will give to the Warrant Agent written notice of the location of any
such office or agency and of any change of location thereof. The Company hereby
designates the Warrant Agent at its principal corporate trust office identified
in Section 7.03 in the Borough of Manhattan, The City of New York (the "Warrant
Agent Office"), as the initial agency maintained for each such purpose. In case
the Company shall fail to maintain any such office or agency or shall fail to
give such notice of the location or of any change in the location thereof,
presentations and demands may be made and notice may be served at the Warrant
Agent Office and the Company appoints the Warrant Agent as its agent to receive
all such presentations, surrenders, notices and demands.
ARTICLE II
DURATION, EXERCISE OF WARRANTS; EXERCISE
PRICE AND REPURCHASE OF WARRANTS
SECTION 2.01. Duration of Warrants. Subject to the terms and conditions
established herein, the Warrants shall expire at 5:00 p.m., New York City time,
on December 1, 2002. The applicable date of expiration of a particular Warrant
is referred to herein as the "Expiration Date" of such Warrant. Each Warrant may
be exercised on any Business Day (as defined below) on or after the first
anniversary of the Issue Date and on or prior to the close of business on the
Expiration Date.
Any Warrant not exercised before the close of business on the Expiration
Date shall become void, and all rights of the holder under the Warrant
Certificate evidencing such Warrant and under this Agreement shall cease.
-15-
"Business Day" shall mean any day on which (i) banks in New York City, (ii)
the principal U.S. securities exchange or market, if any, on which any Common
Stock is listed or admitted to trading and (iii) the principal U.S. securities
exchange or market, if any, on which the Warrants are listed or admitted to
trading are open for business.
SECTION 2.02. Exercise, Exercise Price, Settlement and Delivery. (a)
Subject to the provisions of this Agreement, a holder of a Warrant shall have
the right to purchase from the Company on or after the issue date of such
Warrant and on or prior to the close of business on the Expiration Date 12.482
fully paid, registered and nonassessable shares of Common Stock (and any other
securities or property purchasable or deliverable upon exercise of such Warrant
as provided in Article V), subject to adjustment in accordance with Article V
hereof, at the purchase price of $5.50 for each share purchased (the "Exercise
Price"). The number of Shares for which a particular Warrant may be exercised
(the "Exercise Rate") shall be subject to adjustment from time to time as set
forth in Article V hereof.
(b) Warrants may be exercised by (i) surrendering at any office or agency
maintained for that purpose by the Company pursuant to Section 1.10 (each a
"Warrant Exercise Office") the Warrant Certificate evidencing such Warrants with
the form of election to exercise Shares set forth on the reverse side of the
Warrant Certificate (the "Election to Exercise") duly completed and signed by
the registered holder or holders thereof or by the duly appointed legal
representative thereof or by a duly authorized attorney, and in the case of a
transfer, such signature shall be guaranteed by an eligible guarantor
institution, and (ii) paying in full the Exercise Price for each such Warrant
exercised. Each Warrant may be exercised only in whole.
(c) Simultaneously with the exercise of each Warrant, payment in full of
the aggregate Exercise Price may be made, at the option of the holder, (i) by
United States dollars or by certified or official bank check, (ii) by the
surrender (which surrender shall be evidenced by cancellation of the number of
Warrants represented by any Warrant Certificate presented in connection with a
Cashless Exercise) of a Warrant or Warrants (represented by one or more Warrant
Certificates), and without payment of the Exercise Price in cash, for such
number of Shares equal to the product of (1) the number of Shares for which such
Warrant is exercisable with payment in cash of the aggregate Exercise Price as
of the date of exercise and (2) the
-16-
Cashless Exercise Ratio or (iii) by any combination of (i) and (ii). For
purposes of this Agreement, the "Cashless Exercise Ratio" shall equal a
fraction, the numerator of which is the excess of the Current Market Value per
share of the Common Stock on the date of exercise over the Exercise Price per
share as of the date of exercise and the denominator of which is the Current
Market Value per share of the Common Stock on the date of exercise. An exercise
of a Warrant in accordance with the immediately preceding sentences is herein
called a "Cashless Exercise." Upon surrender of a Warrant Certificate
representing more than one Warrant in connection with the holder's option to
elect a Cashless Exercise, the number of Shares deliverable upon a Cashless
Exercise shall be equal to the Cashless Exercise Ratio multiplied by the product
of (a) the number of Warrants that the holder specifies is to be exercised
pursuant to a Cashless Exercise and (b) the number of Shares for which such
Warrant is then exercisable (without giving effect to the Cashless Exercise
option). All provisions of this Agreement shall be applicable with respect to an
exercise of a Warrant Certificate pursuant to a Cashless Exercise for less than
the full number of Warrants represented thereby. No payment or adjustment shall
be made on account of any dividends on the Shares issued upon exercise of a
Warrant. The Warrant Agent shall have no obligation under this section to
calculate the Cashless Exercise Ratio.
(d) Upon such surrender of a Warrant Certificate and payment and collection
of the Exercise Price at any Warrant Exercise Office (other than any Warrant
Exercise Office that also is an office of the Warrant Agent), such Warrant
Certificate and payment shall be promptly delivered to the Warrant Agent. The
"Exercise Date" for a Warrant shall be the date when all of the items referred
to in the first sentence of paragraphs (b) and (c) of this Section 2.02 are
received by the Warrant Agent at or prior to 11:00 a.m., New York City time, on
a Business Day and the exercise of the Warrants will be effective as of such
Exercise Date. If any items referred to in the first sentence of paragraphs (b)
and (c) are received after 11:00 a.m., New York City time, on a Business Day,
the exercise of the Warrants to which such item relates will be effective on the
next succeeding Business Day. Notwithstanding the foregoing, in the case of an
exercise of Warrants on the Expiration Date, if all of the items referred to in
the first sentence of paragraphs (b) and (c) are received by the Warrant Agent
at or prior to 5:00 p.m., New York City time, on the Expiration Date, the
exercise of the Warrants to which such items relate will be effective on the
Expiration Date.
-17-
(e) Upon the exercise of a Warrant in accordance with the terms hereof, the
receipt of a Warrant Certificate and payment of the Exercise Price (or election
of the Cashless Exercise option), the Warrant Agent shall: (i) except to the
extent exercise of the Warrant has been effected through Cashless Exercise,
cause an amount equal to the aggregate Exercise Price to be paid to the Company
by crediting the same to the account designated by the Company in writing to the
Warrant Agent for that purpose; (ii) advise the Company immediately by telephone
of the amount so deposited to the Company's account and promptly confirm such
telephonic advice in writing; and (iii) as soon as practicable, advise the
Company in writing of the number of Warrants exercised in accordance with the
terms and conditions of this Agreement and the Warrant Certificates, the
instructions of each exercising holder of the Warrant Certificates with respect
to delivery of the Shares to which such holder is entitled upon such exercise,
and such other information as the Company shall reasonably request.
(f) Subject to Section 5.02 hereof, as soon as practicable after the
exercise of any Warrant or Warrants in accordance with the terms hereof, the
Company shall issue or cause to be issued to or upon the written order of the
registered holder of the Warrant Certificate evidencing such exercised Warrant
or Warrants, a certificate or certificates evidencing the Shares to which such
holder is entitled, in fully registered form, registered in such name or names
as may be directed by such holder pursuant to the Election to Exercise, as set
forth on the reverse of the Warrant Certificate. Such certificate or
certificates evidencing the Shares shall be deemed to have been issued and any
persons who are designated to be named therein shall be deemed to have become
the holder of record of such Shares as of the close of business on the Exercise
Date; the Shares may initially be issued in global form (the "Global Shares").
Such Global Shares shall represent such of the outstanding Shares as shall be
specified therein and each shall provide that it shall represent the aggregate
amount of outstanding Shares from time to time endorsed thereon and that the
aggregate amount of outstanding Shares represented thereby may from time to time
be reduced or increased, as appropriate. Any endorsement of a Global Share to
reflect the amount of any increase or decrease in the amount of outstanding
Shares represented thereby shall be made by the registrar for the Shares and the
Depositary (referred to below) in accordance with instructions given by the
holder thereof. The Depository Trust Company shall (if possible) act as the
Depositary with respect to the Global Shares until a successor shall be
appointed by the Company and the registrar for the Shares. After such exer-
-18-
cise of any Warrant or Shares, the Company shall also issue or cause to be
issued to or upon the written order of the registered holder of such Warrant
Certificate, a new Warrant Certificate, countersigned by the Warrant Agent
pursuant to written instruction, evidencing the number of Warrants, if any,
remaining unexercised unless such Warrants shall have expired.
SECTION 2.03. Cancellation of Warrant Certificates. In the event the
Company shall purchase or otherwise acquire Warrants, the Warrant Certificates
evidencing such Warrants may thereupon be delivered to the Warrant Agent, and if
so delivered, shall at the Company's written instruction be canceled by it and
retired. The Warrant Agent shall cancel all Warrant Certificates properly
surrendered for exchange, substitution, transfer or exercise. Upon the Company's
written request, the Warrant Agent shall deliver such canceled Warrant
Certificates to the Company.
ARTICLE III
OTHER PROVISIONS RELATING TO RIGHTS OF
HOLDERS OF WARRANTS
SECTION 3.01. Enforcement of Rights. (a) Notwithstanding any of the
provisions of this Agreement, any holder of any Warrant Certificate, without the
consent of the Warrant Agent, the holder of any Shares or the holder of any
other Warrant Certificate, may, in and for his own behalf, enforce, and may
institute and maintain any suit, action or proceeding against the Company
suitable to enforce, his right to exercise the Warrant or Warrants evidenced by
his Warrant Certificate in the manner provided in such Warrant Certificate and
in this Agreement.
(b) Neither the Warrants nor any Warrant Certificate shall entitle the
holders thereof to any of the rights of a holder of Shares, including, without
limitation, the right to vote or to receive any dividends or other payments or
to consent or to receive notice as stockholders in respect of the meetings of
stockholders or for the election of directors of the Company or any other
matter, or any rights whatsoever as stockholders of the Company, except as
expressly provided herein (including Section 5.03 hereof).
SECTION 3.02. Obtaining Stock Exchange Listings. The Company will from time
to time take all action that may be necessary so that the Shares, immediately
upon their issuance upon the exercise of Warrants, will be listed on the
principal
-19-
securities exchanges and markets within the United States, if any, on which
other shares of Common Stock are then listed.
ARTICLE IV
CERTAIN COVENANTS OF THE COMPANY
SECTION 4.01. Payment of Taxes. The Company will pay all documentary stamp
taxes attributable to the initial issuance of Warrants and of the Shares upon
the exercise of Warrants; provided, however, that the Company shall not be
required to pay any tax or other governmental charge that may be payable in
respect of any transfer or exchange of any Warrant Certificates or any
certificates for Shares in a name other than the registered holder of a Warrant
Certificate surrendered upon the exercise of a Warrant. In any such case, no
transfer or exchange shall be made unless or until the person or persons
requesting issuance thereof shall have paid to the Company the amount of such
tax or other governmental charge or shall have established to the satisfaction
of the Company that such tax or other governmental charge has been paid or an
exemption is available therefrom.
SECTION 4.02. Reservation of Warrant Shares. The Company will at all times
reserve and keep available, free from preemptive rights, out of the aggregate of
its authorized but unissued Common Stock, for the purpose of enabling it to
satisfy any obligation to issue Shares upon exercise of Warrants, the maximum
number of shares of Common Stock that may then be deliverable upon the exercise
of all outstanding Warrants.
Before taking any action that would cause an adjustment pursuant to Section
5.01 reducing the Exercise Price below the then par value of the Warrant Shares,
the Company will use its best efforts to take any and all corporate action that
may be necessary in order that the Company may validly and legally issue fully
paid and nonassessable Shares at the Exercise Price as so adjusted.
SECTION 4.03. Obtaining of Governmental Approvals. The Company will from
time to time take all action required to be taken by it which may be necessary
to obtain and keep effective any and all permits, consents and approvals of
governmental agencies and authorities and securities acts filings under United
States Federal and state laws, and the rules and regulations of all stock
exchanges on which the Warrants are listed, if any, which may be or become
requisite in connection with the issuance, sale, transfer, and delivery of the
Warrant Certifi-
-20-
▇▇▇▇▇, the exercise of the Warrants or the issuance, sale, transfer and delivery
of the Warrant Shares issued upon exercise of the Warrants. ARTICLE V
ADJUSTMENTS
SECTION 5.01. Adjustment of Exercise Rate; Notices. The Exercise Rate is
subject to adjustment from time to time as provided in this Section.
(a) Adjustment for Change in Capital Stock. If, after the date hereof, the
Company:
(i) pays a dividend or makes a distribution on any of its Common
Stock in shares of any of its Common Stock (other than any such
dividend to the extent covered by Section 5.03);
(ii) subdivides any of its outstanding shares of Common Stock
into a greater number of shares;
(iii) combines any of its outstanding shares of Common Stock into
a smaller number of shares;
(iv) pays a dividend or makes a distribution on any of its Common
Stock in shares of any of its Capital Stock (as defined below) (other
than Common Stock or rights, warrants, or options for its Common Stock
to the extent such issuance or distribution is covered by Section
5.03); or
(v) issues by reclassification of any of its Common Stock any
shares of any of its Capital Stock (other than rights, warrants or
options for its Common Stock);
then the Exercise Rate in effect immediately prior to such action for each
Warrant then outstanding shall be adjusted so that the holder of a Warrant
thereafter exercised may receive the number of shares of Capital Stock of the
Company that such holder would have owned immediately following such action if
such holder had exercised the Warrant immediately prior to such action or
immediately prior to the record date applicable thereto, if any (without giving
effect to the Cashless Exercise option).
-21-
The adjustment shall become effective immediately after the record date in
the case of a dividend or distribution and immediately after the effective date
in the case of a subdivision, combination or reclassification. In the event that
such dividend or distribution is not so paid or made or such subdivision,
combination or reclassification is not effected, the Exercise Rate shall again
be adjusted to be the Exercise Rate which would then be in effect if such record
date or effective date had not been so fixed.
If after an adjustment a holder of a Warrant upon exercise of such Warrant
may receive shares of two or more classes of Capital Stock of the Company, the
Exercise Rate shall thereafter be subject to adjustment upon the occurrence of
an action taken with respect to any such class of Capital Stock as is
contemplated by this Article V with respect to the Common Stock, on terms
comparable to those applicable to Common Stock in this Article V.
(b) Adjustment for Sale of Common Stock Below Current Market Value. If,
after the date hereof, the Company grants or sells to any Affiliate of the
Company (other than a wholly-owned subsidiary) any Common Stock or any
securities convertible into or exchangeable or exercisable for any Common Stock
at a price below the then Current Market Value (other than (1) pursuant to the
exercise of the Warrants, (2) pursuant to any security convertible into, or
exchangeable or exercisable for shares of Common Stock outstanding as of the
date of this Agreement, (3) upon the conversion, exchange or exercise of any
convertible, exchangeable or exercisable security as to which upon the issuance
thereof has previously been the project of any required adjustment pursuant to
this Article V and (4) upon a public offering of the Company's publicly
tradeable equity securities, the Exercise Rate for each Warrant then outstanding
shall be adjusted in accordance with the formula:
E' = E x (O + N)
(O + (N x P/M))
where:
E' = the adjusted Exercise Rate for each Warrant then outstanding;
E = the then current Exercise Rate for each Warrant then outstanding;
-22-
O = the number of shares of Common Stock outstanding immediately
prior to the sale of Common Stock or issuance of securities
convertible, exchangeable or exercisable for Common Stock;
N = the number of shares of Common Stock so sold or the maximum
stated number of shares of Common Stock issuable upon the
conversion, exchange or exercise of any such convertible,
exchangeable or exercisable securities, as the case may be;
P = the proceeds per share of Common Stock received by the Company, which
(i) in the case of shares of Common Stock is the amount received by the
Company in consideration for the sale and issuance of such shares; and
(ii) in the case of securities convertible into or exchangeable or
exercisable for shares of Common Stock is the amount received by the
Company in consideration for the sale and issuance of such convertible
or exchangeable or exercisable securities, plus the minimum aggregate
amount of additional consideration, other than the surrender of such
convertible or exchangeable securities, payable to the Company upon
exercise, conversion or exchange thereof; and
M = the Current Market Value as of the Time of Determination or
at the time of sale, as the case may be.
The adjustment shall become effective immediately upon consummation of the
sale of Common Stock, as the case may be.
No adjustment in the Exercise Rate shall be made under this paragraph (b)
upon the conversion, exchange or exercise of options to acquire shares of Common
Stock by officers, directors or employees of the Company; provided that the
exercise price of such options, at the time of issuance thereof, is at least
equal to the then Current Market Value of the Common Stock underlying such
options.
"Affiliate" of any specified person means any other person that, directly
or indirectly, controls, is controlled by or is under direct or indirect common
control with such specified person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with") when used with respect to any person means the
power to direct the management
-23-
and policies of such person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise.
(c) Notice of Adjustment. Whenever the Exercise Rate is adjusted, the
Company shall promptly mail to holders of Warrants then outstanding at the
addresses appearing on the Warrant Register a notice of the adjustment. The
Company shall file with the Warrant Agent and any other Registrar such notice
and a certificate from the Company's independent public accountants briefly
stating the facts requiring the adjustment and the manner of computing it. The
certificate shall be conclusive evidence that the adjustment is correct. Neither
the Warrant Agent nor any such Registrar shall be under any duty or
responsibility with respect to any such certificate except to exhibit the same
during normal business hours to any holder desiring inspection thereof.
(d) Reorganization of Company; Special Distributions. (i) If the Company,
in a single transaction or through a series of related transactions, merges,
consolidates or amalgamates with or into any other person or sells, assigns,
transfers, leases, conveys or otherwise disposes of all or substantially all of
its properties and assets to another person or group of affiliated persons or is
a party to a merger or binding share exchange that reclassifies or changes its
outstanding Common Stock (a "Fundamental Transaction"), as a condition to
consummating any such transaction the person formed by or surviving any such
consolidation or merger if other than the Company or the person to whom such
transfer has been made (the "Surviving Person") shall enter into a supplemental
warrant agreement. The supplemental warrant agreement shall provide (a) that the
holder of a Warrant then outstanding may exercise it for the kind and amount of
securities, cash or other assets that such holder would have received
immediately after the Fundamental Transaction if such holder had exercised the
Warrant immediately before the effective date of the transaction (regardless of
whether the Warrants are then exercisable and without giving effect to the
Cashless Exercise option), assuming (to the extent applicable) that such holder
(i) was not a constituent person or an affiliate of a constituent person to such
transaction, (ii) made no election with respect thereto and (iii) was treated
alike with the plurality of non-electing holders, and (b) that the Surviving
Person shall succeed to and be substituted to every right and obligation of the
Company in respect of this Agreement and the Warrants. The supplemental warrant
agreement shall provide for adjustments that shall be as nearly equivalent as
may be practicable to the adjustments
-24-
provided for in this Article V. The Surviving Person shall mail to holders of
Warrants at the addresses appearing on the Warrant Register a notice briefly
describing the supplemental warrant agreement. If the issuer of securities
deliverable upon exercise of Warrants is an affiliate of the Surviving Person,
that issuer shall join in the supplemental warrant agreement.
(ii) Notwithstanding the foregoing, if the Company enters into a
Fundamental Transaction with another Person (other than a subsidiary of the
Company) and consideration is payable to holders of shares of Capital Stock (or
other securities or property) issuable or deliverable upon exercise of the
Warrants that are exercisable in exchange for their shares in connection with
such Fundamental Transaction which consists solely of cash, then the holders of
Warrants shall be entitled to receive distributions on the date of such event on
an equal basis with holders of such shares (or other securities issuable upon
exercise of the Warrants) as if the Warrants had been exercised immediately
prior to such event, less the Exercise Price therefor. Upon receipt of such
payment, if any, the rights of a holder of such a Warrant shall terminate and
cease and such holder's Warrants shall expire.
(iii) If this paragraph (d) applies, it shall supersede the application of
paragraph (a) of this Section 5.01.
(e) Company Determination Final. Any determination that the Company or the
Board of Directors of the Company must make pursuant to this Article V is
conclusive.
(f) Warrant Agent's Adjustment Disclaimer. The Warrant Agent has no duty to
determine when an adjustment under this Article V should be made, how it should
be made or what it should be. The Warrant Agent has no duty to determine whether
a supplemental warrant agreement under paragraph (d) need be entered into or
whether any provisions of any supplemental warrant agreement are correct. The
Warrant Agent shall not be accountable for and makes no representation as to the
validity or value of any securities or assets issued upon exercise of Warrants.
The Warrant Agent shall not be responsible for the Company's failure to comply
with this Article V.
(g) Adjustment for Tax Purposes. The Company may make such increases in the
Exercise Rate, in addition to those otherwise required by this Section, as it
considers to be advisable in order that any event treated for Federal income tax
-25-
purposes as a dividend of stock or stock rights shall not be taxable to the
recipients.
(h) Specificity of Adjustment. Irrespective of any adjustments in the
number or kind of shares purchasable upon the exercise of the Warrants, Warrant
Certificates theretofore or thereafter issued may continue to express the same
number and kind of Shares per Warrant as are stated on the Warrant Certificates
initially issuable pursuant to this Agreement.
(i) Voluntary Adjustment. The Company from time to time may increase the
Exercise Rate by any number and for any period of time (provided that such
period is not less than 20 Business Days). Whenever the Exercise Rate is so
increased, the Company shall mail to holders at the addresses appearing on the
Warrant Register and file with the Warrant Agent a notice of the increase. The
Company shall give the notice at least 15 days before the date the increased
Exercise Rate takes effect. The notice shall state the increased Exercise Rate
and the period it will be in effect. A voluntary increase in the Exercise Rate
does not change or adjust the Exercise Rate otherwise in effect as determined by
this Section 5.01.
(j) Multiple Adjustments. After an adjustment to the Exercise Rate for
outstanding Warrants under this Article V, any subsequent event requiring an
adjustment under this Article V shall cause an adjustment to the Exercise Rate
for outstanding Warrants as so adjusted.
(k) Definitions.
"Capital Stock" means, with respect to any person, any and all shares,
interests, participations, rights in, or other equivalents (however designated
and whether voting or non-voting) of, such person's capital stock, whether
outstanding on the Issue Date (as defined in the Indenture) or issued after the
Issue Date, and any and all rights, warrants or options exchangeable for or
convertible into such capital stock.
"Current Market Value" per share of Common Stock of the Company or any
other security at any date means (i) if the security is not registered under the
Exchange Act, (a) the value of the security, determined in good faith by the
Board of Directors of the Company and certified in a board resolution, based on
the most recently completed arm's-length transaction between the Company and a
person other than an Affiliate of the Company and the closing of which occurs on
such date or shall have occurred within the six-month period preceding such
date,
-26-
or (b) if no transaction shall have occurred on such date or within such
six-month period, the fair market value of the security as determined by an
Independent Financial Expert (provided that, in the case of the calculation of
Current Market Value for determining the cash value of fractional shares, any
such determination within six months that is, in the good faith judgment of the
Board, a reasonable determination of value, may be utilized) or (ii) (a) if the
security is registered under the Exchange Act, the average of the daily closing
sales prices of the securities for the 20 consecutive trading days immediately
preceding such date, or (b) if the security has been registered under the
Exchange Act for less than 20 consecutive trading days immediately preceding
such date, then the average of the closing sales prices for all of the trading
days before such date for which closing sales prices are available, in the case
of each of (ii)(a) and (ii)(b), as certified to the Warrant Agent by the
Chairman of the Board, President, any Vice President or the Chief Financial
Officer of the Company. The closing sales price for each such trading day shall
be: (A) in the case of a security listed or admitted to trading on any United
States national securities exchange or quotation system, the closing sales
price, regular way, on such day, or if no sale takes place on such day, the
average of the closing bid and asked prices on such day, (B) in the case of a
security not then listed or admitted to trading on any United States national
securities exchange or quotation system, the last reported sale price on such
day, or if no sale takes place on such day, the average of the closing bid and
asked prices on such day, as reported by a reputable quotation source designated
by the Company, (C) in the case of a security not then listed or admitted to
trading on any United States national securities exchange or quotation system
and as to which no such reported sale price or bid and asked prices are
available, the average of the reported high bid and low asked prices on such
day, as reported by a reputable quotation service, or a newspaper of general
circulation in the Borough of Manhattan, City and State of New York customarily
published on each Business Day, designated by the Company, or, if there shall be
no bid and asked prices on such day, the average of the high bid and low asked
prices, as so reported, on the most recent day (not more than 30 days prior to
the date in question) for which prices have been so reported and (D) if there
are not bid and asked prices reported during the 30 days prior to the date in
question, the Current Market Value shall be determined as if the Shares (or
other securities) were not registered under the Exchange Act.
-27-
"Independent Financial Expert" means a United States investment banking
firm of national standing in the United States (i) which does not, and whose
directors, officers and employees or Affiliates do not have a direct or indirect
material financial interest for its proprietary account in the Company or any of
its Affiliates and (ii) which, in the judgment of the Board of Directors of the
Company, is otherwise independent with respect to the Company and its Affiliates
and qualified to perform the task for which it is to be engaged.
"Time of Determination" means, (i) in the case of any distribution of
securities or other property to existing stockholders to which paragraph (b)
applies, the time and date of the determination of stockholders entitled to
receive such securities or property or (ii) in the case of any other issuance
and sale to which paragraph (b) applies, the time and date of such issuance or
sale.
(l) When De Minimis Adjustment may be Deferred. No Adjustment in the
Exercise Rate need be made unless the adjustment would require an increase of at
least 1% in the Exercise Rate. Any adjustments that are not made shall be
carried forward and taken into account in any subsequent adjustments. All
calculations under this Section 5 shall be made to the nearest 1/1000th of a
share, as the case may be.
SECTION 5.02. Fractional Shares. The Company will not be required to issue
fractional Shares upon exercise of the Warrants or distribute Share certificates
that evidence fractional Shares. In the event a holder is required by Section
2.02(c) to make a Cashless Exercise, the number of Shares issuable shall be
rounded up to the nearest whole number. In addition, in no event shall any
holder of Warrants be required to make any payment of a fractional cent. In lieu
of fractional Shares, there shall be paid to the registered holders of Warrant
Certificates at the time Warrants evidenced thereby are exercised as herein
provided an amount in cash equal to the same fraction of the Current Market
Value, per Share on the Business Day preceding the date the Warrant Certificates
evidencing such Warrants are surrendered for exercise. Such payments will be
made by check or by transfer to an account maintained by such registered holder
with a bank in The City of New York. If any holder surrenders for exercise more
than one Warrant Certificate, the number of Shares deliverable to such holder
may, at the option of the Company, be computed on the basis of the aggregate
amount of all the Warrants exercised by such holder.
-28-
SECTION 5.03. Certain Distributions. If at any time the Company grants,
issues or sells options, convertible securities, or rights to purchase Capital
Stock, warrants or other securities pro rata to the record holders of any Common
Stock (the "Distribution Rights") or, without duplication, makes any dividend or
otherwise makes any distribution, including, subject to applicable law, pursuant
to any plan of liquidation ("Distribution") on Common Stock (whether in cash,
property, evidences of indebtedness or otherwise), then the Company shall grant,
issue, sell or make to each registered holder of Warrants then outstanding, the
aggregate Distribution Rights or Distribution, as the case may be, which such
holder would have acquired if such holder had held the maximum number of Shares
acquirable upon complete exercise of such holder's Warrants (regardless of
whether the Warrants are then exercisable and without giving effect to the
Cashless Exercise option) immediately before the record date for the grant,
issuance or sale of such Distribution Rights or Distribution, as the case may
be, or, if there is no such record date, the date as of which the record holders
of Common Stock are to be determined for the grant, issue or sale of such
Distribution Rights or Distribution, as the case may be.
ARTICLE VI
CONCERNING THE WARRANT AGENT
SECTION 6.01. Warrant Agent. The Company hereby appoints The Bank of New
York as Warrant Agent of the Company in respect of the Warrants and the Warrant
Certificates upon the terms and subject to the conditions herein and in the
Warrant Certificates set forth; and The Bank of New York hereby accepts such
appointment. The Warrant Agent shall have the powers and authority specifically
granted to and conferred upon it in the Warrant Certificates and hereby and such
further powers and authority to act on behalf of the Company as the Company may
hereafter grant to or confer upon it and it shall accept in writing. All of the
terms and provisions with respect to such powers and authority contained in the
Warrant Certificates are subject to and governed by the terms and provisions
hereof. The Warrant Agent may act through agents and shall not be responsible
for the misconduct or negligence of any such agent appointed with due care.
SECTION 6.02. Conditions of Warrant Agent's Obligations. The Warrant Agent
accepts its obligations herein set forth upon the terms and conditions hereof
and in the Warrant Certificates, including the following, to all of which the
Com-
-29-
pany agrees and to all of which the rights hereunder of the holders from time to
time of the Warrant Certificates shall be subject:
(a) The Warrant Agent shall be entitled to compensation to be agreed
upon with the Company in writing for all services rendered by it and the
Company agrees promptly to pay such compensation and to reimburse the
Warrant Agent for its reasonable out-of-pocket expenses (including
reasonable fees and expenses of counsel) incurred without gross negligence
or willful misconduct on its part in connection with the services rendered
by it hereunder. The Company also agrees to indemnify the Warrant Agent and
any predecessor Warrant Agent, their directors, officers, affiliates,
agents and employees for, and to hold them and their directors, officers,
affiliates, agents and employees harmless against, any loss, liability or
expense of any nature whatsoever (including, without limitation, reasonable
fees and expenses of counsel) incurred without gross negligence or willful
misconduct on the part of the Warrant Agent, arising out of or in
connection with its acting as such Warrant Agent hereunder and its exercise
of its rights and performance of its obligations hereunder. The obligations
of the Company under this Section 6.02 shall survive the exercise and the
expiration of the Warrant Certificates and the resignation and removal of
the Warrant Agent.
(b) In acting under this Agreement and in connection with the Warrant
Certificates, the Warrant Agent is acting solely as agent of the Company
and does not assume any obligation or relationship of agency or trust for
or with any of the owners or holders of the Warrant Certificates.
(c) The Warrant Agent may consult with counsel of its selection and
any advice or opinion of such counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in accordance with such advice or
opinion.
(d) The Warrant Agent shall be fully protected and shall incur no
liability for or in respect of any action taken or omitted to be taken or
thing suffered by it in reliance upon any Warrant Certificate, notice,
direction, consent, certificate, affidavit, opinion of counsel,
instruction, statement or other paper or document reasonably
-30-
believed by it to be genuine and to have been presented or signed by the
proper parties.
(e) The Warrant Agent, and its officers, directors, affiliates and
employees ("Related Parties"), may become the owners of, or acquire any
interest in, Warrant Certificates, shares or other obligations of the
Company with the same rights that it or they would have it if were not the
Warrant Agent hereunder and, to the extent permitted by applicable law, it
or they may engage or be interested in any financial or other transaction
with the Company and may act on, or as depositary, trustee or agent for,
any committee or body of holders of shares or other obligations of the
Company as freely as if it were not the Warrant Agent hereunder. Nothing in
this Agreement shall be deemed to prevent the Warrant Agent or such Related
Parties from acting in any other capacity for the Company.
(f) The Warrant Agent shall not be under any liability for interest
on, and shall not be required to invest, any monies at any time received by
it pursuant to any of the provisions of this Agreement or of the Warrant
Certificates.
(g) The Warrant Agent shall not be under any responsibility in respect
of the validity of this Agreement (or any term or provision hereof) or the
execution and delivery hereof (except the due execution and delivery hereof
by the Warrant Agent) or in respect of the validity or execution of any
Warrant Certificate (except its authentication thereof).
(h) The recitals and other statements contained herein and in the
Warrant Certificates (except as to the Warrant Agent's authentication
thereon) shall be taken as the statements of the Company and the Warrant
Agent assumes no responsibility for the correctness of the same. The
Warrant Agent does not make any representation as to the validity or
sufficiency of this Agreement or the Warrant Certificates, except for its
due execution and delivery of this Agreement; provided, however, that the
Warrant Agent shall not be relieved of its duty to authenticate the Warrant
Certificates as authorized by this Agreement. The Warrant Agent shall not
be accountable for the use or application by the Company of the proceeds of
the exercise of any Warrant.
-31-
(i) Before the Warrant Agent acts or refrains from acting with respect
to any matter contemplated by this Warrant Agreement, it may require:
(1) an Officers' Certificate (as defined in the Indenture)
stating on behalf of the Company that, in the opinion of the signers,
all conditions precedent, if any, provided for in this Warrant
Agreement relating to the proposed action have been complied with; and
(2) if reasonably necessary in the sole judgment of the Warrant
Agent, an opinion of counsel for the Company stating that, in the
opinion of such counsel, all such conditions precedent have been
complied with provided that such matter is one customarily opined on
by counsel.
Each Officers' Certificate or, if requested, an opinion of counsel
with respect to compliance with a condition or covenant provided for in
this Warrant Agreement shall include:
(1) a statement that the person making such certificate or
opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such person, he or she
has made such examination or investigation as is necessary to enable
him or her to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(4) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with.
(j) The Warrant Agent shall be obligated to perform such duties as are
herein and in the Warrant Certificates specifically set forth and no implied
duties or obligations shall be read into this Agreement or the Warrant
Certificates against the Warrant Agent. The Warrant Agent shall not be
accountable or under any duty or responsibil-
-32-
ity for the use by the Company of any of the Warrant Certificates authenticated
by the Warrant Agent and delivered by it to the Company pursuant to this
Agreement. The Warrant Agent shall have no duty or responsibility in case of any
default by the Company in the performance of its covenants or agreements
contained in the Warrant Certificates or in the case of the receipt of any
written demand from a holder of a Warrant Certificate with respect to such
default, including, without limiting the generality of the foregoing, any duty
or responsibility to initiate or attempt to initiate any proceedings at law or
otherwise or, except as provided in Section 7.02 hereof, to make any demand upon
the Company.
(k) Unless otherwise specifically provided herein, any order, certificate,
notice, request, direction or other communication from the Company made or given
under any provision of this Agreement shall be sufficient if signed by its
chairman of the Board of Directors, its president, its treasurer, its controller
or any vice president or its secretary or any assistant secretary.
(l) The Warrant Agent shall have no responsibility in respect of any
adjustment pursuant to Article V hereof.
(m) The Company agrees that it will perform, execute, acknowledge and
deliver, or cause to be performed, executed, acknowledged and delivered, all
such further and other acts, instruments and assurances as may reasonably be
required by the Warrant Agent for the carrying out or performing by the Warrant
Agent of the provisions of this Agreement.
(n) The Warrant Agent is hereby authorized and directed to accept written
instructions with respect to the performance of its duties hereunder from any
one of the chairman of the Board of Directors, the president, the treasurer, the
controller, any vice president or the secretary or assistant secretary of the
Company or any other officer or official of the Company reasonably believed to
be authorized to give such instructions and to apply to such officers or
officials for advice or instructions in connection with its duties, and it shall
not be liable for any action taken or suffered to be taken by it in good faith
in accordance with instructions with respect to any matter arising in connection
with the Warrant Agent's duties and obligations arising under this Agreement.
Such application by the Warrant Agent for written instructions
-33-
from the Company may, at the option of the Warrant Agent, set forth in writing
any action proposed to be taken or omitted by the Warrant Agent with respect to
its duties or obligations under this Agreement and the date on or after which
such action shall be taken and the Warrant Agent shall not be liable for any
action taken or omitted in accordance with a proposal included in any such
application on or after the date specified therein (which date shall be not less
than 10 Business Days after the Company receives such application unless the
Company consents to a shorter period), provided that (i) such application
includes a statement to the effect that it is being made pursuant to this
paragraph (n) and that unless objected to prior to such date specified in the
application, the Warrant Agent will not be liable for any such action or
omission to the extent set forth in such paragraph (n) and (ii) prior to taking
or omitting any such action, the Warrant Agent has not received written
instructions objecting to such proposed action or omission.
(o) Whenever in the performance of its duties under this Agreement the
Warrant Agent shall deem it necessary or desirable that any fact or matter be
proved or established by the Company prior to taking or suffering any action
hereunder, such fact or matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed to be conclusively proved and
established by a certificate signed on behalf of the Company by any one of the
chairman of the Board of Directors, the president, the treasurer, the
controller, any vice president or the secretary or assistant secretary of the
Company or any other officer or official of the Company reasonably believed to
be authorized to give such instructions and delivered to the Warrant Agent; and
such certificate shall be full authorization to the Warrant Agent for any action
taken or suffered in good faith by it under the provisions of this Agreement in
reliance upon such certificate.
(p) The Warrant Agent shall not be required to risk or expend its own funds
in the performance of its obligations and duties hereunder.
SECTION 6.03. Resignation and Appointment of Successor. (a) The Company
agrees, for the benefit of the holders from time to time of the Warrant
Certificates, that there shall at all times be a Warrant Agent hereunder.
-34-
(b) The Warrant Agent may at any time resign as Warrant Agent by giving
written notice to the Company of such intention on its part, specifying the date
on which its desired resignation shall become effective; provided, however, that
such date shall be at least 60 days after the date on which such notice is given
unless the Company agrees to accept less notice. Upon receiving such notice of
resignation, the Company shall promptly appoint a successor Warrant Agent,
qualified as provided in Section 6.03(d) hereof, by written instrument in
duplicate signed on behalf of the Company, one copy of which shall be delivered
to the resigning Warrant Agent and one copy to the successor Warrant Agent. As
provided in Section 6.03(d) hereof, such resignation shall become effective upon
the earlier of (x) the acceptance of the appointment by the successor Warrant
Agent or (y) 60 days after receipt by the Company of notice of such resignation.
The Company may, at any time and for any reason, and shall, upon any event set
forth in the next succeeding sentence, remove the Warrant Agent and appoint a
successor Warrant Agent by written instrument in duplicate, specifying such
removal and the date on which it is intended to become effective, signed on
behalf of the Company, one copy of which shall be delivered to the Warrant Agent
being removed and one copy to the successor Warrant Agent. The Warrant Agent
shall be removed as aforesaid if it shall become incapable of acting, or shall
be adjudged a bankrupt or insolvent, or a receiver of the Warrant Agent or of
its property shall be appointed, or any public officer shall take charge or
control of it or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation. Any removal of the Warrant Agent and any
appointment of a successor Warrant Agent shall become effective upon acceptance
of appointment by the successor Warrant Agent as provided in Section 6.03(d). As
soon as practicable after appointment of the successor Warrant Agent, the
Company shall cause written notice of the change in the Warrant Agent to be
given to each of the registered holders of the Warrants in the manner provided
for in Section 8.04 hereof.
(c) Upon resignation or removal of the Warrant Agent, if the Company shall
fail to appoint a successor Warrant Agent within a period of 60 days after
receipt of such notice of resignation or removal, then the holder of any Warrant
Certificate or the retiring Warrant Agent may apply to a court of competent
jurisdiction for the appointment of a successor to the 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.
-35-
(d) Any successor Warrant Agent, whether appointed by the Company or by a
court, shall be a bank or trust company in good standing, incorporated under the
laws of the United States of America or any State thereof and having, at the
time of its appointment, a combined capital surplus of at least $50 million.
Such successor Warrant Agent shall execute and deliver to its predecessor and to
the Company an instrument accepting such appointment hereunder and all the
provisions of this Agreement, and thereupon such successor Warrant Agent,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, duties and obligations of its predecessor hereunder, with like
effect as if originally named as Warrant Agent hereunder, and such predecessor
shall thereupon become obligated to (i) transfer and deliver, and such successor
Warrant Agent shall be entitled to receive, all securities, records or other
property on deposit with or held by such predecessor as Warrant Agent hereunder
and (ii) upon payment of the amounts then due it pursuant to Section 6.02(a)
hereof, pay over, and such successor Warrant Agent shall be entitled to receive,
all monies deposited with or held by any predecessor Warrant Agent hereunder.
(e) Any corporation or bank into which the Warrant Agent hereunder may be
merged or converted, or any corporation or bank with which the Warrant Agent may
be consolidated, or any corporation or bank resulting from any merger,
conversion or consolidation to which the Warrant Agent shall be a party, or any
corporation or bank to which the Warrant Agent shall sell or otherwise transfer
all or substantially all of its corporate trust business, shall be the successor
to the Warrant Agent under this Agreement (provided that such corporation or
bank shall be qualified as aforesaid) without the execution or filing of any
document or any further act on the part of any of the parties hereto.
(f) No Warrant Agent under this Warrant Agreement shall be personally
liable for any action or omission of any successor Warrant Agent.
ARTICLE VII
REGISTRATION
SECTION 7.01. Shelf Registration.
(a) The Company shall prepare and file with the United States Securities
and Exchange Commission (the "Commission") (i) a registration statement (the
"Warrant Regis-
-36-
tration Statement") on an appropriate form under the Securities Act of 1933, as
amended (the "Securities Act"), relating to all of the Warrants and (ii) a
registration statement (the "Warrant Shares Registration Statement", and
together with the Warrant Registration Statement, the "Registration Statements")
on an appropriate form under the Securities Act, relating to the offer and sale
by the Company of the Warrant Shares issuable upon exercise of all of the
Warrants by the holders thereof from time to time in accordance with the methods
of distribution set forth in the Warrant Shares Registration Statement (such
registrations pursuant to clauses (i) and (ii) above, the "Shelf Registration").
The Company may, in lieu of preparing and filing a Warrant Registration
Statement and a Warrant Shares Registration Statement, prepare and file one
Registration Statement relating to both the Warrants and the Warrant Shares
issuable upon exercise of the Warrants.
(b) The Company shall file such Registration Statement or Registration
Statements under the Securities Act on or prior to the 45th day after the Issue
Date.
SECTION 7.02. Effectiveness Period. The Company shall use its best efforts
to keep the Registration Statement or Registration Statements continuously
effective under the Securities Act in order to permit the prospectus included
therein to be lawfully delivered by the Company to the holders of the Warrants
and the Warrant Shares until the first to occur of (i) the date all of the
shares of Common Stock issued or issuable upon the exercise of the Warrants have
been disposed of in accordance with the Registration Statement or (ii) if any
Warrants remain unexercised on or prior to the Expiration Date, the close of
business on the Expiration Date. The Company receives an opinion of counsel, in
form and substance satisfactory to the Warrant Agent, that all restrictive
legends relating to the transfer of the Warrants and the Warrant shares may
properly be removed from such securities and such legends have been so removed;
provided that, except as provided below with respect to any Black Out Period (as
defined), the Company shall be deemed not to have used its best efforts to keep
the Registration Statement or Registration Statements effective during the
requisite period if it voluntarily takes any action that would result in it not
being able to offer and sell the Warrant Shares issuable upon exercise of the
Warrants during that period, unless such action is required by applicable law.
Notwithstanding the foregoing, the Company shall not be required to amend or
supplement a Registration Statement, any related prospectus or any document
incorporated therein by reference in the event that, and for a period (a "Black
Out Period") not to
-37-
exceed, for so long as this Agreement is in effect, an aggregate of 45 days
within any 12-month period if (x) an event occurs and is continuing as a result
of which a Registration Statement, any related prospectus or any document
incorporated therein by reference as then amended or supplemented would, in the
Company's good faith judgment, contain an untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements therein,
in light of the circumstances under which they were made, not misleading, and
(y)(1) the Company determines in its good faith judgment that the disclosure of
such event at such time would have a material adverse effect on the business,
operations or prospects of the Company or (2) the disclosure otherwise relates
to a material business transaction that has not yet been publicly disclosed in
any relevant jurisdiction; provided that no Black Out Period may be in effect
during the six months immediately prior to the Expiration Date.
SECTION 7.03. Registration Procedures.
(a) The Company shall cause the Registration Statement or Registration
Statements and the related prospectus or prospectuses and any amendments or
supplements thereto, as of the effective date of the Registration Statement or
Registration Statements, amendments or supplements and subject to Section 7.02,
as of any time thereafter while the Warrants and the Warrant Shares remain
outstanding (i) to comply in all material respects with the applicable
requirements of the Securities Act and the rules and regulations of the
Commission and (ii) not to contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading.
(b) The Company shall give prompt written notice to the holders of the
Warrants and the Warrant Shares and the Warrant Agent:
(i) when the Registration Statement or Registration Statements or any
post-effective amendments thereto have become effective;
(ii) of the issuance by the Commission of any stop order suspending
the effectiveness of any Registration Statement or the initiation or
threatening of any proceedings for that purpose;
-38-
(iii) of the receipt by the Company or its legal counsel of any
notification with respect to the suspension of the qualification of the
Warrants or the Warrant Shares for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose;
(iv) of the happening of any event that requires the Company to make
changes in any Registration Statement or prospectus in order to make the
statements therein not misleading; and
(v) of the commencement and termination of any Black Out Period.
(c) The Company shall use its best efforts to prevent the issuance or
obtain the withdrawal of any order suspending the effectiveness of any
Registration Statement at the earliest possible time.
(d) Upon the occurrence of any event contemplated by clauses (b)(iv) or (v)
of this Section 7.03, the Company shall promptly prepare a post-effective
amendment to the applicable Registration Statement or a supplement to the
related prospectus or file any other required document so that, as thereafter
delivered to holders of the Warrants or the Warrant Shares, as applicable, the
prospectus will not contain an untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading and will contain
the current information required by the Securities Act.
(e) Not later than the effective date of the applicable Registration
Statement, the Company will provide a CUSIP number for the Warrants and the
Warrant Shares, and provide the registrar with printed certificates for the
Warrants and the Warrant Shares in a form eligible for deposit with The
Depository Trust Company.
(f) The Company will comply with all rules and regulations of the
Commission to the extent and so long as they are applicable to the Shelf
Registration and will make generally available to its securities holders (or
otherwise provide in accordance with Section 11(a) of the Securities Act) an
earning statement satisfying the provisions of Section 11(a) of the Securities
Act as soon as practicable, but in any event, no later than 45 days after the
end of the most recent 12-month period (or 90 days, if such period is a fiscal
year (plus any exten-
-39-
sion permitted by Rule 12b-25 under the Exchange Act)) beginning with the first
month of the Company's first fiscal quarter commencing after the effective date
of the Registration Statements, which statement shall cover such 12-month
period.
(g) The Company shall register or qualify or cooperate with the holders in
connection with the registration or qualification of the Warrants and the
Warrant Shares issuable upon exercise of the Warrants under the securities or
blue sky laws of such states of the United States as any holder reasonably
requests and do any and all other acts or things necessary or advisable to
enable such offer and sale in such jurisdictions; provided that the Company
shall not be required to (i) qualify to do business as a broker-dealer in any
jurisdiction where it is not then so qualified or (ii) take any action that
would subject it to general service of process or to taxation in any
jurisdiction where it is not then so subject.
(h) The Company shall bear all expenses incurred by it in connection with
the performance of its obligations under this Article VII.
(i) The Company shall deliver to the holders of the Warrants and the
Warrant Shares who so request, without charge, at least one copy of the
applicable Registration Statement and any post-effective amendment thereto,
including financial statements and schedules, and, if any such holder requests,
all exhibits (including those, if any, incorporated by reference).
(j) The Company shall deliver to each holder of the Warrants and the
Warrant Shares, without charge, as many copies of the prospectus or prospectuses
(including each preliminary prospectus) included in such Registration Statement
or Registration Statements and any amendments or supplements thereto as such
person may reasonably request. The Company consents, subject to the provisions
of this Agreement, to the use of the prospectus or prospectuses or any
amendments or supplements thereto by each of the selling holders of the Warrants
and the Warrant Shares in connection with the offering and sale of the Warrants
and the Warrant Shares covered by the prospectus or prospectuses, or any
amendments or supplements thereto, included in such Registration Statement or
Registration Statements.
(k) The Company shall deliver to the holders of the Warrants and the
Warrant Shares, any participating broker-dealer and such other persons required
to deliver a prospectus in connection with the offering and sale of the War-
-40-
rants and the Warrant Shares, without charge, as many copies of the final
prospectus or prospectuses included in the Registration Statement or
Registration Statements and any amendments or supplements thereto as such
persons may reasonably request. The Company consents, subject to the provisions
of this Agreement, to the use of the prospectus or prospectuses or any
amendments or supplements thereto by the holders of the Warrants and the Warrant
Shares, if necessary, any Participating Broker-Dealer and such other persons
required to deliver a prospectus in connection with the offering and sale of the
Warrants and the Warrant Shares covered by such prospectus, or any amendments or
supplements thereto, included in such Registration Statement or Registration
Statements.
(l) The Company shall enter into such agreements (including an underwriting
agreement in form, scope and substance as is reasonable and customary for an
issuer in comparable underwritten offerings), and take all such other actions in
connection therewith in order to expedite or facilitate the disposition of the
Warrant Shares pursuant to any Registration Statement contemplated by this
Agreement, all to such extent as may reasonably be requested by any holder of
Warrant Shares or underwriter, if any, in connection with any sale or resale
pursuant to any Registration Statement contemplated by this Agreement.
(m) The Company shall cooperate with the holders of Warrants and Warrant
Shares in any filings required to be made with the National Association of
Securities Dealers, Inc. (the "NASD") and in the performance of any due
diligence investigation by any underwriter (including any "qualified independent
underwriter" that is required to be retained in accordance with the rules and
regulations of the NASD).
(n) The Company shall cause all Warrant Shares covered by the applicable
Registration Statement to be listed on each securities exchange on which similar
securities issued by the Company are then listed, to the extent such Warrant
Shares satisfy applicable listing requirements, if requested by the holders of a
majority of such Warrant Shares or the managing underwriter(s), if any.
(o) In connection with any registration of the Warrants and the Warrant
Shares, the Company agrees to indemnify and hold harmless (i) each holder of the
Warrants and the Warrant Shares covered by the applicable Registration
Statement, (ii) each person, if any, who controls (within the meaning of Section
15 of the Act or Section 20 of the Exchange Act) any
-41-
such holder (any of the persons referred to in this clause (ii) being
hereinafter referred to as a "controlling person") and (iii) the respective
officers, directors, partners, employees, representatives and agents of any such
holder or any controlling person (any person referred to in clause (i), (ii) or
(iii) may hereinafter be referred to as an "Indemnified Person") to the fullest
extent lawful, from and against any and all losses, claims, damages,
liabilities, judgments, actions and expenses caused by, related to, based upon,
arising out of or in connection with any untrue statement or alleged untrue
statement of a material fact contained in the applicable Registration Statement
or Registration Statements or the prospectus or the prospectuses (including any
amendments or supplements thereto) or any preliminary prospectus or preliminary
prospectuses or any omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
(in the case of the prospectus or prospectuses, in light of the circumstances
under which they were made) not misleading, except insofar as such losses,
claims, damages, liabilities, judgments, actions or expenses are caused by an
untrue statement or omission or alleged untrue statement or omission that is
made in reliance upon and in conformity with information relating to such holder
furnished in writing to the Company by such holder expressly for use in the
Registration Statement or Registration Statements or the prospectus or
prospectuses (or any amendment or supplement thereto) or any preliminary
prospectus or preliminary prospectuses, provided that the Company shall not be
liable to any Indemnified Person under the indemnity agreement in this Section
7.03(o) with respect to any preliminary prospectus to the extent that any such
loss, claim, damage, liability, judgment, action or expense of such Indemnified
Person results solely from an untrue statement of a material fact contained in,
or the omission of a material fact from such preliminary prospectus which untrue
statement or omission was completely corrected in a final prospectus (as then
amended or supplemented) if the Company shall sustain the burden of proving that
such holder sold Warrants or Warrant Shares, as the case may be, to the person
alleging such loss, claim, damage, liability, judgment, action or expense
without sending or giving, at or prior to the written confirmation of such sale,
a copy of the prospectus (as then amended or supplemented) if the Company had
previously furnished copies thereof to such holder within a reasonable amount of
time prior to such sale or such confirmation.
-42-
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendment. This Agreement and the terms of the Warrants may
be amended by the Company and the Warrant Agent, without the consent of the
holder of any Warrant Certificate, for the purpose of curing any ambiguity, or
of curing, correcting or supplementing any defective or inconsistent provision
contained herein or therein, or to effect any assumptions of the Company's
obligations hereunder and thereunder by a successor corporation under the
circumstances described in Section 5.01(d) hereof or in any other manner which
the Company may deem necessary or desirable and which shall not adversely affect
the interests of the holders of the Warrant Certificates.
The Company and the Warrant Agent may amend, modify or supplement this
Agreement and the terms of the Warrants, and waivers to departures from the
terms hereof and thereof may be given, with the consent of the Requisite Warrant
Holders (as defined below) for the purpose of adding any provision to or
changing in any manner or eliminating any of the provisions of this Agreement or
modifying in any manner the rights of the holders of the outstanding Warrants;
provided, however, that no such modification that increases the Exercise Price
or decreases the Exercise Rate, reduces the period of time during which the
Warrants are exercisable hereunder, or effects any change to this Section 8.01
may be made with respect to any Warrant without the consent of the holder of
such Warrant. "Requisite Warrant Holders" means (i) in the case of any
amendment, modification, supplement or waiver affecting Warrant Holders as such
holders of a majority in number of the outstanding Warrants so affected, or (ii)
in the case of any amendment, modification, supplement or waiver affecting
Warrant Holders, a majority in number of Shares represented by the Warrants that
would be issuable assuming exercise thereof at the time such amendment,
modification, supplement or waiver is voted upon. Notwithstanding any other
provision of this Agreement, the Warrant Agent's consent must be obtained
regarding any supplement or amendment which alters the Warrant Agent's rights or
duties (it being expressly understood that the foregoing shall not be in
derogation of the right of the Company to remove the Warrant Agent in accordance
with Section 6.03 hereof). For purposes of any amendment, modification or waiver
hereunder, Warrants held by the Company or any of its Affiliates shall be
disregarded.
-43-
Any modification or amendment made in accordance with this Agreement 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.
SECTION 8.02. Notices and Demands to the Company and Warrant Agent. If the
Warrant Agent shall receive any notice or demand addressed to the Company by the
holder of a Warrant Certificate pursuant to the provisions hereof or of the
Warrant Certificates, the Warrant Agent shall promptly forward such notice or
demand to the Company.
SECTION 8.03. Addresses for Notices to Parties and for Transmission of
Documents. All notices hereunder to the parties hereto shall be deemed to have
been given when sent by certified or registered mail, postage prepaid, or by
facsimile transmission, confirmed by first class mail, postage prepaid,
addressed to any party hereto as follows:
To the Company:
American Banknote Corporation
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile Number: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: General Counsel
To the Warrant Agent:
The Bank of New York
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile Number: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Corporate Trust Trustee Administration
or at any other address of which either of the foregoing shall have notified the
other in writing.
SECTION 8.04. Notices to Holders. Notices to holders of Warrants shall be
mailed to such holders at the addresses of such holders as they appear in the
Warrant Register.
-44-
Any such notice shall be sufficiently given if sent by first-class mail, postage
prepaid.
SECTION 8.05. APPLICABLE LAW; SUBMISSION TO JURISDICTION. THE VALIDITY,
INTERPRETATION AND PERFORMANCE OF THIS AGREEMENT AND EACH WARRANT CERTIFICATE
ISSUED HEREUNDER AND OF THE RESPECTIVE TERMS AND PROVISIONS THEREOF SHALL BE
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE
CONFLICT OF LAWS PROVISIONS THEREOF.
SECTION 8.06. Persons Having Rights Under Agreement. Nothing in this
Agreement expressed or implied and nothing that may be inferred from any of the
provisions hereof is intended, or shall be construed, to confer upon, or give
to, any person or corporation other than the Company, the Warrant Agent, the
holders of the Warrant Certificates and, with respect to Section 4.04 and 4.05,
the holders of Shares issued pursuant to Warrants, any right, remedy or claim
under or by reason of this Agreement or of any covenant, condition, stipulation,
promise or agreement hereof; and all covenants (except for Section 4.04 which
shall be for the benefit of all holders of Shares issued pursuant to Warrants),
conditions, stipulations, promises and agreements in this Agreement contained
shall be for the sole and exclusive benefit of the Company and the Warrant Agent
and their successors and of the holders of the Warrant Certificates.
SECTION 8.07. Headings. The descriptive headings of the several Articles
and Sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.
SECTION 8.08. Counterparts. This Agreement may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original; but
such counterparts shall together constitute but one and the same instrument.
SECTION 8.09. Inspection of Agreement. A copy of this Agreement shall be
available during regular business hours at the principal corporate trust office
of the Warrant Agent, for inspection by the holder of any Warrant Certificate.
The Warrant Agent may require such holder to submit his Warrant Certificate for
inspection by it.
SECTION 8.10. Availability of Equitable Remedies. Since a breach of the
provisions of this Agreement could not adequately be compensated by money
damages, holders of Warrants shall be entitled, in addition to any other right
or remedy
-45-
available to them, to an injunction restraining such breach or a threatened
breach and to specific performance of any such provision of this Agreement, and
in either case no bond or other security shall be required in connection
therewith, and the parties hereby consent to such injunction and to the ordering
of specific performance.
SECTION 8.11. Obtaining of Governmental Approvals. The Company will from
time to time take all action required to be taken by it which may be necessary
to obtain and keep effective any and all permits, consents and approvals of
governmental agencies and authorities and securities acts filings under United
States Federal and state laws, and the rules and regulations of all stock
exchanges on which the Warrants are listed which may be or become requisite in
connection with the issuance, sale, transfer, and delivery of the Warrant
Certificates, the exercise of the Warrants or the issuance, sale, transfer and
delivery of the Shares issued upon exercise of the Warrants.
[Signature Page Follows]
S-1
IN WITNESS WHEREOF, this Warrant Agreement has been duly executed by the
parties hereto as of the day and year first above written.
AMERICAN BANKNOTE CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President
THE BANK OF NEW YORK,
as Warrant Agent
By: /s/ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇ ▇▇ ▇▇▇▇▇▇
Title: Assistant Vice President
EXHIBIT A
[FORM OF WARRANT CERTIFICATE]
[FACE]
THIS SECURITY IS A GLOBAL UNIT AND IS REGISTERED IN THE NAME OF A
DEPOSITARY OR A NOMINEE OF A DEPOSITARY OR A SUCCESSOR DEPOSITARY. THIS
SECURITY IS NOT EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A
PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS SECURITY
(OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE
DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR
ITS AGENT FOR REGISTRATION OR TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE OR
OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS
SECURITY BY ITS ACCEPTANCE HEREOF (1) REPRESENTS
A-1
THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT "RULE 144A") OR (B) IT IS AN INSTITUTIONAL
"ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) UNDER
THE SECURITIES ACT) (AN "ACCREDITED INVESTOR") OR (C) IT IS NOT A U.S.
PERSON AND IS ACQUIRING THIS SECURITY IN AN "OFFSHORE TRANSACTION" PURSUANT
TO RULE 903 OR 904 OF REGULATION S UNDER THE SECURITIES ACT ("REGULATION
S"), (2) AGREES THAT IT WILL NOT PRIOR TO (X) THE DATE WHICH IS TWO YEARS
(OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k) UNDER THE
SECURITIES ACT OR ANY SUCCESSOR PROVISION THEREUNDER) AFTER THE LATER OF
THE ORIGINAL ISSUE DATE HEREOF (OR OF ANY PREDECESSOR OF THIS SECURITY) OR
THE LAST DAY ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE
OWNER OF THIS SECURITY OR ANY PREDECESSOR OF THIS SECURITY AND (Y) SUCH
LATER DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAWS (THE "RESALE
RESTRICTION TERMINATION DATE"), OFFER, SELL OR OTHERWISE TRANSFER THIS
SECURITY EXCEPT (A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) PURSUANT
TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE
PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM
NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A,
(D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE
UNITED STATES WITHIN THE MEANING OF REGULATION S, PURSUANT TO RULE 904 OF
REGULATION S, (E) TO AN ACCREDITED INVESTOR THAT IS ACQUIRING THE
SECURITIES FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH ACCREDITED
INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR
SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES
ACT OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT IT WILL GIVE TO EACH
PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE
HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE. AS USED HEREIN, THE
A-2
TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE
RESPECTIVE MEANINGS GIVEN TO THEM IN REGULATION S.
A-3
CUSIP #[ ]
No. [ ] [ ] Warrants
WARRANT CERTIFICATE
AMERICAN BANKNOTE CORPORATION
This Warrant Certificate certifies that [ ], or registered assigns, is the
registered holder of [ ] Warrants (the "Warrants") to purchase 1,185,790 shares
of Common Stock, par value $0.01 per share (the "Common Stock"), subject to the
conditions contained herein and in the Warrant Agreement, of American Banknote
Corporation, a Delaware corporation (the "Company," which term includes its
successors and assigns) (the "Warrant Agreement"). Each Warrant entitles the
holder to purchase from the Company at any time from 9:00 a.m. New York City
time on or after the first anniversary of the Issue Date until 5:00 p.m., New
York City time, on the Expiration Date (each as defined in the Warrant
Agreement), 12.482 fully paid, registered and nonassessable shares of Common
Stock, subject to adjustment as provided in Article V of the Warrant Agreement,
at the exercise price of $5.50 for each share purchased (the "Exercise Price")
(the shares of Common Stock purchasable upon exercise of a Warrant being herein
referred to as the "Shares" and, unless the context otherwise requires, such
term shall also mean the other securities or property purchasable and
deliverable upon exercise of a Warrant as provided in the Warrant Agreement),
upon surrender of this Warrant Certificate and payment of the Exercise Price (i)
in United States dollars or certified official or bank check, (ii) pursuant to
the next sentence or (iii) in any combination of (i) and (ii), at any office or
agency maintained for that purpose by the Company (the "Warrant Agent Office"),
subject to the conditions set forth herein and in the Warrant Agreement. A
Warrant may also be exercised solely by the surrender of the Warrant, and
without the payment of the Exercise Price in cash, for such number of Shares
equal to the product of (1) the number of Shares for which such Warrant is
exercisable with payment of the Exercise Price as of the date of exercise and
(2) the Cashless Exercise Ratio. For purposes of this Warrant, the "Cashless
Exercise Ratio" shall equal a fraction, the numerator of which is the excess of
the Current Market Value per share of the Common Stock on the date of exercise
over the Exercise
A-4
Price per share as of the date of exercise and the denominator of which is the
Current Market Value per share of the Common Stock on the date of exercise. An
exercise of a Warrant in accordance with the immediately preceding sentences is
herein called a "Cashless Exercise." Upon surrender of a Warrant Certificate
representing more than one Warrant in connection with the Holder's option to
elect a Cashless Exercise, the number of Shares deliverable upon a Cashless
Exercise shall be equal to the Cashless Exercise Ratio multiplied by the product
of (a) the number of Warrants that the holder specifies is to be exercised
pursuant to a Cashless Exercise and (b) the number of Shares for which such
Warrant is then exercisable (without giving effect to the Cashless Exercise
Option). All provisions of the Warrant Agreement shall be applicable with
respect to an exercise of a Warrant Certificate pursuant to a Cashless Exercise
for less than the full number of Warrants represented thereby. Capitalized terms
used herein without being defined herein shall have the definitions ascribed to
such terms in the Warrant Agreement.
"Current Market Value" per share of Common Stock of the Company or any
other security at any date means (i) if the security is not registered under the
Exchange Act, (a) the value of the security, determined in good faith by the
Board of Directors of the Company and certified in a board resolution, based on
the most recently completed arm's-length transaction between the Company and a
person other than an Affiliate of the Company and the closing of which occurs on
such date or shall have occurred within the six-month period preceding such date
or (b) if no transaction shall have occurred on such date or within such six
month period, the fair market value of the security as determined by an
Independent Financial Expert (provided that, in the case of the calculation of
Current Market Value for determining the cash value of fractional shares, any
such determination within six months that is, in the good faith judgment of the
Board, a reasonable determination of value, may be utilized) or (ii) (a) if the
security is registered under the Exchange Act, the average of the daily closing
sales prices of the securities for the 20 consecutive trading days immediately
preceding such date, or (b) if the security has been registered under the
Exchange Act for less than 20 consecutive trading days before such date, then
the average of the closing sales prices for all of the trading days before such
date for which closing sales prices are available, in the case of each of
(ii)(a) and (ii)(b), as certified to the Warrant Agent by the Chairman of the
Board, President, any Vice
A-5
President or the Chief Financial Officer of the Company. The closing sales price
for each such trading day shall be: (A) in the case of a security listed or
admitted to trading on any United States national securities exchange or
quotation system, the closing sales price, regular way, on such day, or if no
sale takes place on such day, the average of the closing bid and asked prices on
such day, (B) in the case of a security not then listed or admitted to trading
on any United States national securities exchange or quotation system, the last
reported sale price on such day, or if no sale takes place on such day, the
average of the closing bid and asked prices on such day, as reported by a
reputable quotation source designated by the Company, (C) in the case of a
security not then listed or admitted to trading on any United States national
securities exchange or quotation system and as to which no such reported sale
price or bid and asked prices are available, the average of the reported high
bid and low asked prices on such day, as reported by a reputable quotation
service, or a newspaper of general circulation in the Borough of Manhattan, City
and State of New York customarily published on each Business Day, designated by
the Company, or, if there shall be no bid and asked prices on such day, the
average of the high bid and low asked prices, as so reported, on the most recent
day (not more than 30 days prior to the date in question) for which prices have
been so reported and (D) if there are not bid and asked prices reported during
the 30 days prior to the date in question, the Current Market Value shall be
determined as if the Shares (or other securities) were not registered under the
Exchange Act.
"Independent Financial Expert" means a United States investment banking
firm of national standing, (i) which does not, and whose directors, officers and
employees or Affiliates do not have a direct or indirect material financial
interest for its proprietary account in the Company or any of its Affiliates and
(ii) which, in the judgment of the Board of Directors of the Company, is
otherwise independent with respect to the Company and its Affiliates and
qualified to perform the task for which it is to be engaged.
"Separability Date" shall mean the earliest to occur of (i) June 10, 1998,
(ii) the date on which a registration statement under the Securities Act of
1933, as amended (the "Securities Act"), with respect to a registered exchange
offer for the Notes or covering the sale by holders of the Notes is declared
effective under the Securities Act and (iii) such ear-
A-6
lier date as may be determined by Chase Securities Inc. in its sole discretion
and specified to the Company, the Trustee, the Warrant Agent and the Unit Agent
in writing.
The Company has initially designated the principal corporate trust office
of the Warrant Agent in the Borough of Manhattan, The City of New York, as the
initial Warrant Agent Office. The number of Shares issuable upon exercise of the
Warrants ("Exercise Rate") is subject to adjustment upon the occurrence of
certain events set forth in the Warrant Agreement.
Any Warrants not exercised on or prior to 5:00 p.m., New York City time, on
December 1, 2002 shall thereafter be void.
Reference is hereby made to the further provisions on the reverse hereof
which provisions shall for all purposes have the same effect as though fully set
forth at this place.
This Warrant Certificate shall not be valid unless authenticated by the
Warrant Agent, as such term is used in the Warrant Agreement.
THIS WARRANT CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PROVISIONS
THEREOF.
A-7
WITNESS the seal of the Company and signatures of its duly authorized
officers.
Dated:
AMERICAN BANKNOTE CORPORATION
By: ____________________________
Name:
Title:
By: ____________________________
Name:
Title:
Certificate of Authentication:
This is one of the Warrants
referred to in the within
mentioned Warrant Agreement:
THE BANK OF NEW YORK,
as Warrant Agent
By: _____________________________
Authorized Signatory
A-8
[FORM OF WARRANT CERTIFICATE]
[REVERSE]
AMERICAN BANKNOTE CORPORATION
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants expiring at 5:00 p.m., New York City time, on
December 1, 2002 (the "Expiration Date"), each of which represents the right to
purchase at any time on or after the first anniversary of the Issue Date (as
defined in the Warrant Agreement) and on or prior to the Expiration Date 12.482
shares of Common Stock, subject to adjustment as set forth in the Warrant
Agreement. The Warrants are issued pursuant to a Warrant Agreement dated as of
December 12, 1997 (the "Warrant Agreement"), duly executed and delivered by the
Company to The Bank of New York, as Warrant Agent (the "Warrant Agent"), which
Warrant Agreement is hereby incorporated by reference in and made a part of this
instrument and is hereby referred to for a description of the rights, limitation
of rights, obligations, duties and immunities thereunder of the Warrant Agent,
the Company and the holders (the words "holders" or "holder" meaning the
registered holders or registered holder) of the Warrants.
Warrants may be exercised by (i) surrendering at any Warrant Agent Office
this Warrant Certificate with the form of Election to Exercise set forth hereon
duly completed and executed and (ii) to the extent such exercise is not being
effected through a Cashless Exercise by paying in full the Warrant Exercise
Price for each such Warrant exercised and any other amounts required to be paid
pursuant to the Warrant Agreement.
If all of the items referred to in the preceding paragraph are received by
the Warrant Agent at or prior to 11:00 a.m., New York City time, on a Business
Day, the exercise of the Warrant to which such items relate will be effective on
such Business Day. If any items referred to in the preceding paragraph are
received after 11:00 a.m., New York City time, on a Business Day, the exercise
of the Warrants to which such item relates will be deemed to be effective on the
next succeeding Business Day. Notwithstanding the foregoing, in the case of an
exercise of Warrants on December 1, 2002, if all of the items referred to in the
preceding paragraph are received by the Warrant Agent at or prior to 5:00 p.m.,
New York City time, on
A-9
such Expiration Date, the exercise of the Warrants to which such items relate
will be effective on the Expiration Date.
As soon as practicable after the exercise of any Warrant or Warrants, the
Company shall issue or cause to be issued to or upon the written order of the
registered holder of this Warrant Certificate, a certificate or certificates
evidencing the Share or Shares to which such holder is entitled, in fully
registered form, registered in such name or names as may be directed by such
holder pursuant to the Election to Exercise, as set forth on the reverse of this
Warrant Certificate. Such certificate or certificates evidencing the Share or
Shares shall be deemed to have been issued and any persons who are designated to
be named therein shall be deemed to have become the holder of record of such
Share or Shares as of the close of business on the date upon which the exercise
of this Warrant was deemed to be effective as provided in the preceding
paragraph.
The Company will not be required to issue fractional shares of Common Stock
upon exercise of the Warrants or distribute Share certificates that evidence
fractional shares of Common Stock. In lieu of fractional shares of Common Stock,
there shall be paid to the registered Holder of this Warrant Certificate at the
time such Warrant Certificate is exercised an amount in cash equal to the same
fraction of the Current Market Value per share of Common Stock on the Business
Day preceding the date this Warrant Certificate is surrendered for exercise.
Warrant Certificates, when surrendered at any office or agency maintained
by the Company for that purpose by the registered holder thereof in person or by
legal representative or attorney duly authorized in writing, may be exchanged
for a new Warrant Certificate or new Warrant Certificates evidencing in the
aggregate a like number of Warrants, in the manner and subject to the
limitations provided in the Warrant Agreement, without charge except for any tax
or other governmental charge imposed in connection therewith.
Upon due presentment for registration of transfer of this Warrant
Certificate at any office or agency maintained by the Company for that purpose,
a new Warrant Certificate evidencing in the aggregate a like number of Warrants
shall be issued to the transferee in exchange for this Warrant Certificate,
subject to the limitations provided in the Warrant Agree-
A-10
ment, without charge except for any tax or other governmental charge imposed in
connection therewith.
The Company and the Warrant Agent may deem and treat the registered holder
hereof as the absolute owner of this Warrant Certificate (notwithstanding any
notation of ownership or other writing hereon made by anyone) for the purpose of
any exercise hereof and for all other purposes, and neither the Company nor the
Warrant Agent shall be affected by any notice to the contrary.
The term "Business Day" shall mean any day on which (i) banks in New York
City, (ii) the principal U.S. securities exchange or market, if any, on which
the Common Stock is listed or admitted to trading and (iii) the principal U.S.
securities exchange or market, if any, on which the Warrants are listed or
admitted to trading are open for business.
Upon the written request of holders of a majority of the Warrants in the
aggregate, the Company shall prepare and file a Warrant Registration Statement
and a Warrant Shares Registration Statement (each as defined in the Warrant
Agreement) relating to the Warrants and the Warrant Shares, respectively.
A-11
(FORM OF ELECTION TO EXERCISE)
(To be executed upon exercise of Warrants on the Exercise Date)
The undersigned hereby irrevocably elects to exercise [ ] of the Warrants
represented by this Warrant Certificate and purchase the whole number of Shares
issuable upon the exercise of such Warrants and herewith tenders payment for
such Shares as follows:
$[ ] in cash or by certified or official bank check; or by surrender of
Warrants pursuant to a Cashless Exercise (as defined in the Warrant Agreement)
for [ ] shares of Common Stock at the current Cashless Exercise Ratio.
The undersigned requests that a certificate representing such Shares be
registered in the name of ____________________ whose address is
_________________________ and that such shares be delivered to
__________________________ whose address is __________________________. Any cash
payments to be paid in lieu of a fractional Share should be made to
__________________ whose address is ________________________ and the check
representing payment thereof should be delivered to ______________________ whose
address is _________________________.
Dated __________________, ____
Name of holder of
Warrant Certificate: _______________________________
(Please Print)
Tax Identification or
Social Security Number: ____________________________
Address: ___________________________________________
___________________________________________
Signature: _________________________________________
Note: The above signature must correspond with the name
as written upon the face of this Warrant Certifi-
cate in every particular, without alteration or
enlargement or any change whatever and if the
A-12
certificate representing the Shares or any Warrant
Certificate representing Warrants not exercised
is to be registered in a name other than that in
which this Warrant Certificate is registered, or
if any cash payment to be paid in lieu of a
fractional share is to be made to a person other
than the registered holder of this Warrant
Certificate, the signature of the holder hereof
must be guaranteed as provided in the Warrant
Agreement.
Dated ____________________, ___
Signature: ________________________________________
Note: The above signature must
correspond with the name as
written upon the face of this
Warrant Certificate in
every particular, without
alteration or enlargement or
any change whatever.
Signature Guaranteed: _____________________________
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Agent Medallion Program ("STAMP") or such other
"signature guarantee program" as may be determined by the Registrar in addition
to, or in substitution for, STAMP, all in accordance with the Securities
Exchange Act of 1934, as amended.
[FORM OF ASSIGNMENT]
For value received _______________________ hereby sells, assigns and
transfers unto _____________________ the within Warrant Certificate, together
with all right, title and interest therein, and does hereby irrevocably
constitute and appoint __________________________ attorney, to transfer said
Warrant Certificate on the books of the within-named Company, with full power of
substitution in the premises.
A-13
Dated ____________________, ______
Signature: ________________________________________
Note: The above signature must
correspond with the name as
written upon the face of this
Warrant Certificate in every
particular, without
alteration or enlargement or
any change whatever.
Signature Guaranteed: _____________________________
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Agent Medallion Program ("STAMP") or such other
"signature guarantee program" as may be determined by the Registrar in addition
to, or in substitution for, STAMP, all in accordance with the Securities
Exchange Act of 1934, as amended.
A-14
SCHEDULE OF EXCHANGES OF CERTIFICATED WARRANTS1
The following exchanges of a part of this Global Warrant for certificated
Warrants have been made:
Number of
Warrants of
Amount of Amount of this Global
decrease in increase in Warrant Signature of
Number of Number of following authorized
Date of Warrants of this Warrants of this such decrease officer of
Exchange Global Warrant Global Warrant (or increase) Warrant Agent
-----------------
1 This is to be included only if the Warrant is in global form.
A-15
EXHIBIT B
FORM OF LEGEND FOR GLOBAL WARRANT
Any Global Warrant authenticated and delivered hereunder shall bear a
legend in substantially the following form:
THIS SECURITY IS A GLOBAL WARRANT WITHIN THE MEANING OF THE WARRANT
AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A
DEPOSITARY OR A NOMINEE OF A DEPOSITARY OR A SUCCESSOR DEPOSITARY. THIS
SECURITY IS NOT EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A
PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE WARRANT AGREEMENT, AND NO TRANSFER OF THIS
SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE
DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITORY
TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED
EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE WARRANT AGREEMENT.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
B-1
EXHIBIT C
FORM OF CERTIFICATE TO BE DELIVERED UPON
EXCHANGE OR REGISTRATION OF TRANSFER OF WARRANTS
Re: Warrants to Purchase Common Stock (the
"Warrants") of AMERICAN BANKNOTE CORPORATION
This Certificate relates to ____ Warrants held in* ___ book-entry or*
_______ certificated form by ______ (the "Transferor").
The Transferor:*
/ / has requested the Warrant Agent by written order to deliver in exchange
for its beneficial interest in the Global Warrant held by the Depositary a
Warrant or Warrants in definitive, registered form of authorized denominations
and an aggregate number equal to its beneficial interest in such Global Warrant
(or the portion thereof indicated above); or
/ / has requested the Warrant Agent by written order to exchange or
register the transfer of a Warrant or Warrants.
In connection with such request and in respect of each such Warrant, the
Transferor does hereby certify that Transferor is familiar with the Warrant
Agreement relating to the above captioned Warrants and the restrictions on
transfers thereof as provided in Section 1.08 of such Warrant Agreement, and
that the transfer of this Warrant does not require registration under the
Securities Act of 1933, as amended (the "Act") because*:
/ / Such Warrant is being acquired for the Transferor's own account,
without transfer (in satisfaction of Section 1.08(a)(y)(A) or Section
1.08(d)(i)(A) of the Warrant Agreement).
/ / Such Warrant is being transferred to a qualified institutional buyer
(as defined in Rule 144A under the Act), in reliance on Rule 144A.
C-1
/ / Such Warrant is being transferred to an institutional "accredited
investor" (within the meaning of subparagraphs (a)(1), (2), (3) or (7) of Rule
501 under the Act).
/ / Such Warrant is being transferred in reliance on Regulation S under the
Act.
/ / Such Warrant is being transferred in accordance with Rule 144 under the
Act.
/ / Such Warrant is being transferred in reliance on and in compliance with
an exemption from the registration requirements of the Act.
------------------------------
[INSERT NAME OF TRANSFEROR]
By: _________________________
Date: _________________
*Check applicable box.
C-2
EXHIBIT D
FORM OF CERTIFICATE TO BE
DELIVERED IN CONNECTION WITH
TRANSFERS TO INSTITUTIONAL ACCREDITED INVESTORS
-------------, ----
The Bank of New York
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Corporate Trust Trustee Administration
Ladies and Gentlemen:
In connection with our proposed purchase of warrants (the "Warrants") to
purchase Common Stock of American Banknote Corporation (the "Company"), we
confirm that:
1. We have received such information as we deem necessary in order to make
our investment decision.
2. We understand that any subsequent transfer of the Warrants is subject to
certain restrictions and conditions set forth in the Warrant Agreement and the
undersigned agrees to be bound by, and not to resell, pledge or otherwise
transfer the Warrants except in compliance with, such restrictions and
conditions and the Securities Act of 1933, as amended (the "Securities Act").
3. We understand that the offer and sale of the Warrants have not been
registered under the Securities Act, and that the Warrants may not be offered or
sold within the United States or to, or for the account or benefit of, U.S.
persons except as permitted in the following sentence. We agree, on our own
behalf and on behalf of any accounts for which we are acting as hereinafter
stated, that if we should sell any Warrants prior to (x) the date which is three
years after the later of the date of original issuance of the Warrants (or such
D-1
shorter period as may be prescribed by Rule 144(k) under thSecurities Act or
any successor provision thereto) or the last day on which the Company or any
affiliate of the Company was owner of such Warrants, or any predecessor thereto,
and (y) such later date, if any, as may be required by applicable laws, we will
do so only (A) to the Company, (B) inside the United States in accordance with
Rule 144A under the Securities Act to a "qualified institutional buyer" (as
defined therein), (C) inside the United States to an institutional "accredited
investor" (as defined below) that, prior to such transfer, furnishes (or has
furnished on its behalf by a U.S. broker-dealer) to the Warrant Agent a signed
letter substantially in the form hereof, (D) outside the United States in
accordance with Regulation S under the Securities Act, (E) pursuant to the
exemption from registration provided by Rule 144 under the Securities Act (if
available) or (F) pursuant to an effective registration statement under the
Securities Act and (G) pursuant to another available exemption under the
Securities Act, and we further agree to provide to any person purchasing
Warrants from us a notice advising such purchaser that resales of the Warrants
are restricted as stated herein.
4. We understand that, on any proposed resale of Warrants, we will be
required to furnish to the Warrant Agent and the Company, such certification,
legal opinions and other information as the Warrant Agent and the Company may
reasonably require to confirm that the proposed sale complies with the foregoing
restrictions. We further understand that the Warrants purchased by us will bear
a legend to the foregoing effect.
5. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Warrants, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or their investment, as the case may be.
6. We are acquiring the Warrants purchased by us for our account or
for one or more accounts (each of which is an institutional "accredited
investor") as to each of which we exercise sole investment discretion.
D-2
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceeding or official inquiry with respect
to the matters covered hereby.
Very truly yours,
[Name of Transferee]
By:
[Authorized Signatory]
Upon transfer the Warrants would be registered in the name of the new
beneficial owner as follows:
Name:______________________________
Address:___________________________
Taxpayer ID Number:________________
D-3
EXHIBIT E
FORM OF CERTIFICATE TO BE
DELIVERED IN CONNECTION
WITH REGULATION S TRANSFERS
---------------, ----
The Bank of New York
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Corporate Trust Trustee Administration
Ladies and Gentlemen:
In connection with our proposed sale of Warrants of American Banknote
Corporation (the "Company"), we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the Securities Act of
1933, as amended (the "Securities Act"), and, accordingly, we represent that:
(1) the offer of the Warrants was not made to a person in the United
States;
(2) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting on our
behalf reasonably believed that the transferee was outside the United
States, or (b) the transaction was executed in, on or through the
facilities of a designated off-shore securities market and neither we nor
any person acting on our behalf knows that the transaction has been
pre-arranged with a buyer in the United States;
(3) no directed selling efforts have been made in the United States in
contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S under the Securities Act, as applicable;
E-1
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act;
(5) we have advised the transferee of the transfer restrictions
applicable to the Warrants; and
(6) if the circumstances set forth in Rule 904(c) under the Securities
Act are applicable, we have complied with the additional conditions
therein, including (if applicable) sending a confirmation or other notice
stating that the Warrants may be offered and sold during the restricted
period specified in Rule 903(c)(2) or (3), as applicable, in accordance
with the provisions of Regulation S; pursuant to registration of the
Warrants under the Securities Act; or pursuant to an available exemption
from the registration requirements under the Act.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby. Defined terms used herein without
definition have the respective meanings provided in Regulation S under the
Securities Act.
Very truly yours,
[Name of Transferor]
By:
[Authorized Signature]
Upon transfer the Warrants would be registered in the name of the new
beneficial owner as follows:
Name:______________________________
Address:___________________________
Taxpayer ID Number:________________
E-2