Exhibit 4.3
AMENDED AND RESTATED
WARRANT AGREEMENT
SP ACQUISITION HOLDINGS, INC.
and
CONTINENTAL STOCK TRANSFER & TRUST COMPANY, as Warrant Agent
-----------------------------
AMENDED AND RESTATED
WARRANT AGREEMENT
Dated as of August 7, 2007
AMENDED AND RESTATED
WARRANT AGREEMENT
TABLE OF CONTENTS
Page
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SECTION 1. Appointment of Warrant Agent.......................................1
SECTION 2. Warrant Certificates...............................................1
SECTION 3. Execution of Warrant Certificates..................................2
SECTION 4. Registration and Countersignature..................................2
SECTION 5. Registration of Transfers and Exchanges; Transfer Restrictions.....2
SECTION 6. Terms of Warrants..................................................4
SECTION 7. Payment of Taxes...................................................7
SECTION 8. Mutilated or Missing Warrant Certificates..........................8
SECTION 9. Reservation of Warrant Shares......................................8
SECTION 10. Obtaining Stock Exchange Listings; State Registration.............9
SECTION 11. Adjustment of Number of Warrant Shares............................9
SECTION 12. Fractional Interests.............................................19
SECTION 13. Notices to Warrant Holders.......................................19
SECTION 14. Merger, Consolidation or Change of Name of Warrant Agent.........20
SECTION 15. Warrant Agent....................................................21
SECTION 16. Change of Warrant Agent..........................................24
SECTION 17. Notices to Company and Warrant Agent.............................24
SECTION 18. Supplements and Amendments.......................................25
SECTION 19. Successors.......................................................25
SECTION 20. Termination......................................................25
SECTION 21. Governing Law....................................................25
SECTION 22. Benefits of This Agreement.......................................26
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SECTION 23. Counterparts.....................................................26
SECTION 24. Force Majeure....................................................26
Exhibit A Form of Warrant Certificate
Exhibit B Legend for Private Warrants
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WARRANT AGREEMENT dated as of March 22, 2007, between SP Acquisition
Holdings, Inc., a Delaware corporation (the "Company"), and Continental Stock
Transfer & Trust Company, a New York corporation, as Warrant Agent (the "Warrant
Agent").
WHEREAS, the Company intends to file a registration statement (the
"Registration Statement") with the Securities Exchange Commission for the
initial public offering of units (the "Initial Public Offering"), each unit
("Unit") consisting of one share of the Company's common stock, par value $0.001
per share ("Common Stock"), and one warrant to purchase one share of Common
Stock at an exercise price of $7.50 per share.
WHEREAS, the Company has agreed to issue (i) in a private placement to
occur concurrently with the execution of that certain Founder's Securities
Purchase Agreement, dated March 22, 2007, by and between the Company and SP Acq
LLC, 7,500,000 Units, each unit consisting of one share of Common Stock, and one
warrant to purchase one share of Common Stock at an exercise price of $7.50 per
share (the "Initial Founder's Warrants") to SP Acq LLC (the "Founding
Stockholder"), (ii) in a private placement to occur concurrently with the
closing of the Initial Public Offering, 5,250,000 warrants to purchase shares of
Common Stock (the "Additional Founder's Warrants") to the Founding Stockholder,
(iii) in a private placement to occur immediately prior to the Company's Initial
Business Combination (as such term is defined in the Registration Statement),
3,000,000 Units, each unit consisting of one share of Common Stock, and one
warrant to purchase one share of Common Stock at an exercise price of $7.50 per
share (the "Co-Investment Warrants" and together with the Initial Founder's
Warrant and the Additional Founder's Warrants, the "Private Warrants") and (iv)
up to 34,500,000 warrants to purchase shares of Common Stock to be offered to
the public pursuant to the Registration Statement (the "Public Warrants" and
together with each of the Private Warrants, the "Warrants"). The shares of
Common Stock issuable on exercise of the Warrants are referred to as the
"Warrant Shares").
WHEREAS, the Company desires the Warrant Agent to act on behalf of the
Company, and the Warrant Agent is willing to so act, in connection with the
issuance, transfer, exchange and exercise of Warrants and other matters as
provided herein;
NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein set forth, the parties hereto agree as follows:
SECTION 1. Appointment of Warrant Agent. The Company hereby appoints the
Warrant Agent to act as agent for the Company in accordance with the
instructions set forth hereinafter in this Agreement, and the Warrant Agent
hereby accepts such appointment.
SECTION 2. Warrant Certificates. The certificates evidencing the Warrants
(the "Warrant Certificates") to be delivered pursuant to this Agreement shall be
in registered form only and shall be substantially in the form set forth in
EXHIBIT A attached hereto and the warrant certificates for the Private Warrants
shall bear the legend set forth in Exhibit B except as set forth herein.
SECTION 3. Execution of Warrant Certificates. Warrant Certificates shall
be signed on behalf of the Company by its Chairman of the Board or its President
or Chief Executive Officer or a Vice President and by its Secretary or an
Assistant Secretary. Each such signature upon the Warrant Certificates may be in
the form of a facsimile signature of the present or any future Chairman of the
Board, President, Chief Executive Officer, Vice President, Secretary or
Assistant Secretary and may be imprinted or otherwise reproduced on the Warrant
Certificates and for that purpose the Company may adopt and use the facsimile
signature of any person who shall have been Chairman of the Board, President,
Chief Executive Officer, Vice President, Secretary or Assistant Secretary,
notwithstanding the fact that at the time the Warrant Certificates shall be
countersigned and delivered or disposed of he or she shall have ceased to hold
such office.
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
Certificates so signed shall have been countersigned by the Warrant Agent, or
disposed of by the Company, such Warrant Certificates nevertheless may be
countersigned and delivered or disposed of as though such person had not ceased
to be such officer of the Company; and any Warrant Certificate may be signed on
behalf of the Company by any person who, at the actual date of the execution of
such Warrant Certificate, shall be a proper officer of the Company to sign such
Warrant Certificate, although at the date of the execution of this Amended and
Restated Warrant Agreement any such person was not such officer.
Warrant Certificates shall be dated the date of countersignature by the
Warrant Agent.
SECTION 4. Registration and Countersignature. Warrant Certificates shall
be countersigned by the Warrant Agent and shall not be valid for any purpose
unless so countersigned. The Warrant Agent shall, upon written instructions of
the Chairman of the Board, the President or Chief Executive Officer, a Vice
President, the Treasurer or the Chief Financial Officer of the Company,
countersign, issue and deliver Warrants as provided in this Agreement.
The Company and the Warrant Agent may deem and treat the registered
holder(s) of the Warrant Certificates as the absolute owner(s) thereof
(notwithstanding any notation of ownership or other writing thereon made by
anyone), for all purposes, and neither the Company nor the Warrant Agent shall
be affected by any notice to the contrary.
SECTION 5. Registration of Transfers and Exchanges; Transfer Restrictions.
The Warrant Agent shall from time to time, subject to the limitations of this
Section 5, register the transfer of any outstanding Warrant Certificates upon
the records to be maintained by it for that purpose, upon surrender thereof duly
endorsed or accompanied (if so required by the Warrant Agent) by a written
instrument or instruments of transfer in form satisfactory to the Warrant Agent,
duly executed by the registered holder or holders thereof or by the duly
appointed legal representative thereof or by a duly authorized attorney. Upon
any such registration of transfer, a new Warrant Certificate shall be issued to
the transferee(s) and the surrendered Warrant Certificate shall be cancelled by
the Warrant Agent. Cancelled Warrant Certificates shall thereafter be disposed
of by the Warrant Agent in its customary manner.
The Initial Founder's Warrants and the Co-Investment Warrants may not be
sold or transferred for a period of one year from the date the Company completes
its Initial Business Combination and the Additional Founder's Warrants may not
be sold or transferred until the Company completes its Initial Business
Combination, in either event except in each case to a Permitted Transferee who
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agrees in writing with the Company to be subject to such transfer restrictions
and in the case of the Initial Founder's Warrants the forfeiture of such
Warrants as described in Section 6(f) below. The certificates evidencing the
Initial Founder's Warrants and the Co-Investment Warrants shall bear the legend
set forth on EXHIBIT C hereto, and the Additional Founder's Warrants shall bear
the legend set forth on EXHIBIT B hereto. As used herein, "Permitted Transferee"
means (a) any officer, director or employee of the Company; or (b) any other
person or entity associated or affiliated with Steel Partners II, L.P. or Steel
Partners Ltd.
The holders of any Private Warrants or Warrant Shares issued upon exercise
of any Private Warrants further agree prior to any transfer of such securities,
to give written notice to the Company expressing its desire to effect such
transfer and describing briefly the proposed transfer. Upon receiving such
notice, the Company shall present copies thereof to its counsel and the holder
agrees not to make any disposition of all or any portion of such securities
unless and until:
(a) there is then in effect a registration statement under the
Securities Act covering such proposed disposition and such disposition is made
in accordance with such registration statement, in which case the legends set
forth in EXHIBIT B or Section 6(c) hereof, as the case may be (collectively the
"Legends") with respect to such securities sold pursuant to such registration
statement shall be removed; or
(b) if reasonably requested by the Company, (A) the holder shall
have furnished the Company with an opinion of counsel, reasonably satisfactory
to the Company, that such disposition will not require registration of such
Securities under the Securities Act, (B) the Company shall have received
customary representations and warranties regarding the transferee that are
reasonably satisfactory to the Company signed by the proposed transferee and (C)
the Company shall have received an agreement by such transferee to the
restrictions contained in the Legends.
Each Public Warrant shall initially be issued together with one share of
Common Stock as a Unit. The shares of Common Stock and Public Warrants
comprising a Unit shall not be separately transferable before the later of five
Business Days following the earlier to occur of the expiration of the
underwriters' over-allotment option included in the underwriting agreement with
respect to the publicly offered Units and the exercise of such option in full,
subject to the Company having filed a Form 8-K with the Securities and Exchange
Commission containing an audited balance sheet reflecting the Company's receipt
of the gross proceeds of the offering of the Units and has issued a press
release announcing when such separate trading will begin (the later of such
dates, the "Detachment Date"). Prior to the Detachment Date, Public Warrants may
be transferred or exchanged only together with the Unit in which such Public
Warrant is included, and only for the purpose of effecting, or in conjunction
with, a transfer or exchange of such Unit. Furthermore, prior to the Detachment
Date, each transfer of a Public Unit on the register relating to such Units
shall operate also to transfer the Public Warrant included in such Unit.
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Subject to the terms of this Agreement, Warrant Certificates may be
exchanged at the option of the holder(s) thereof, when surrendered to the
Warrant Agent at its principal corporate trust office, which is currently
located at the address listed in Section 17 hereof, for another Warrant
Certificate or other Warrant Certificates of like tenor and representing in the
aggregate a like number of Warrants. Any holder desiring to exchange a Warrant
Certificate shall deliver a written request to the Warrant Agent, and shall
surrender, duly endorsed or accompanied (if so required by the Warrant Agent) by
a written instrument or instruments of transfer in form satisfactory to the
Warrant Agent, the Warrant Certificate or Certificates to be so exchanged.
Warrant Certificates surrendered for exchange shall be cancelled by the Warrant
Agent. Such cancelled Warrant Certificates shall then be disposed of by such
Warrant Agent in its customary manner.
The Warrant Agent is hereby authorized to countersign, in accordance with
the provisions of this Section 5 and of Section 4 hereof, the new Warrant
Certificates required pursuant to the provisions of this Section 5.
SECTION 6. Terms of Warrants.
(a) Exercise Price and Exercise Period.
The initial exercise price per share that Warrant Shares shall be
purchasable upon the exercise of Warrants (the "Exercise Price") shall be $7.50
per share, and each Warrant shall be initially exercisable to purchase one share
of Common Stock.
Subject to the terms of this Agreement (including without limitation
Section 6(d) below), each Warrant holder shall have the right, which may be
exercised commencing at the opening of business on the first day of the
applicable Warrant Exercise Period set forth below and until 5:00 p.m., New York
City time, on the last day of such Warrant Exercise Period, to receive from the
Company the number of fully paid and nonassessable Warrant Shares which the
holder may at the time be entitled to receive on exercise of such Warrants and
payment of the Exercise Price then in effect for such Warrant Shares. No
adjustments as to dividends will be made upon exercise of the Warrants.
The "Warrant Exercise Period" shall commence (subject to Section 6(d)
below), (A) for all Warrants other than the Initial Founder's Warrants on the
later of: (i) the date that is 12 months from the closing of the Initial Public
Offering or (ii) the date on which the Company completes its Initial Business
Combination, and (B) for the Initial Founder's Warrants on the date that the
Closing Price of the Company's Common Stock exceeds $14.25 per share for any 20
Trading days within a 30 trading day period beginning 90 days after the Initial
Business Combination, and shall end on the earlier of: (i) the date that is five
years from the date of the final prospectus for the offering of the Public
Warrants or (ii) the Business Day preceding the date on which such Warrants are
redeemed pursuant to Section 6(b) below or expire pursuant to Section 6(e)
below.
The "Closing Price" of the Common Stock on any date of determination
means;
(i) the closing sale price for the regular trading session
(without considering after hours or other trading outside
regular trading session hours) of the Common Stock (regular
way) on the American Stock Exchange on that date (or, if no
closing price is reported, the last reported sale price during
that regular trading session),
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(ii) if the Common Stock is not listed for trading on the American
Stock Exchange on that date, as reported in the composite
transactions for the principal United States securities
exchange on which the Common Stock is so listed,
(iii) if the Common Stock is not so reported, the last quoted bid
price for the Common Stock in the over-the-counter market as
reported by the OTC Bulletin Board, the National Quotation
Bureau or similar organization, or
(iv) if the Common Stock is not so quoted, the average of the
mid-point of the last bid and ask prices for the Common Stock
from at least three nationally recognized investment-banking
firms that the Company selects for this purpose.
Each Warrant not exercised prior to 5:00 p.m., New York City time, on the
last day of the Warrant Exercise Period shall become void and all rights
thereunder and all rights in respect thereof under this Agreement shall cease as
of such time.
(b) Redemption of Warrants.
The Company may call the Warrants for redemption, in whole and not in
part, at a price of $.01 per Warrant, upon not less than 30 days' prior written
notice of redemption to each Warrant holder, at any time after such Warrants
have become exercisable pursuant to Section 6(a), if, and only if, (i) the
Closing Price has equaled or exceeded $14.25 per share for any 20 trading days
within a 30-trading-day period ending on the third Business Day prior to the
notice of redemption to Warrant holders and (ii) at all times between the date
of such notice of redemption and the redemption date a registration statement is
in effect covering the Warrant Shares issuable upon exercise of the Warrants and
a current prospectus relating to those Warrant Shares is available.
Notwithstanding the foregoing, no Initial Founder's Warrants or Additional
Founder's Warrants shall be redeemable at the option of the Company so long as
they are held by the Founding Stockholder or its Permitted Transferees,
including Steel Partners II, L.P.; provided that the fact that one or more
Private Warrants are non-redeemable because of the reason described above shall
not affect the Company's right to redeem the Public Warrants, the Co-Investment
Warrants and all Initial Founder's Warrants and Additional Founder's Warrants
that are not held by SP Acq LLC or its Permitted Transferees.
(c) Exercise Procedure.
A Warrant may be exercised upon surrender to the Company at the principal
stock transfer office of the Warrant Agent, which is currently located at the
address listed in Section 17 hereof, of the certificate or certificates
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evidencing the Warrants to be exercised with the form of election to purchase on
the reverse thereof duly filled in and signed and such other documentation as
the Warrant Agent may reasonably request, and upon payment to the Warrant Agent
for the account of the Company of the Exercise Price (adjusted as herein
provided if applicable) for the number of Warrant Shares in respect of which
such Warrants are then exercised. Payment of the aggregate Exercise Price shall
be made in cash or by certified or official bank check payable to the order of
the Company in New York Clearing House Funds, or the equivalent thereof. In no
event will any Warrants be settled on a net cash basis.
Subject to the provisions of Section 7 hereof, upon such surrender of
Warrants and payment of the Exercise Price, the Company shall issue and cause to
be delivered with all reasonable dispatch to and in such name or names as the
Warrant holder may designate, a certificate or certificates for the number of
full Warrant Shares issuable upon the exercise of such Warrants together with
cash as provided in Section 12 hereof. Such certificate or certificates shall be
deemed to have been issued and any person so designated to be named therein
shall be deemed to have become a holder of record of such Warrant Shares as of
the date of the surrender of such Warrants and payment of the Exercise Price.
The Warrants shall be exercisable, at the election of the holders thereof,
either in full or from time to time in part and, in the event that a certificate
evidencing Warrants is exercised in respect of fewer than all of the Warrant
Shares issuable on such exercise at any time prior to the date of expiration of
the Warrants, a new certificate evidencing the remaining Warrant or Warrants
will be issued, and the Warrant Agent is hereby irrevocably authorized to
countersign and to deliver the required new Warrant Certificate or Certificates
pursuant to the provisions of this Section 6 and of Section 4 hereof, and the
Company, whenever required by the Warrant Agent, shall supply the Warrant Agent
with Warrant Certificates duly executed on behalf of the Company for such
purpose. The Warrant Agent may assume that any Warrant presented for exercise is
permitted to be so exercised under applicable law and shall have no liability
for acting in reliance on such assumption.
All Warrant Certificates surrendered upon exercise of Warrants shall be
canceled by the Warrant Agent. Such canceled Warrant Certificates shall then be
disposed of by the Warrant Agent in its customary manner. The Warrant Agent
shall account promptly to the Company with respect to Warrants exercised and
concurrently pay to the Company all monies received by the Warrant Agent for the
purchase of the Warrant Shares through the exercise of such Warrants.
The Warrant Agent shall keep copies of this Agreement and any notices
given or received hereunder available for inspection by the holders with
reasonable prior written notice during normal business hours at its office. The
Company shall supply the Warrant Agent from time to time with such numbers of
copies of this Agreement as the Warrant Agent may request.
Certificates evidencing Warrant Shares issued upon exercise of a Private
Warrant shall contain the following legend:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAW, AND MAY NOT BE
OFFERED, SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND ANY APPLICABLE STATE SECURITIES LAWS OR
AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.
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SECURITIES EVIDENCED BY THIS CERTIFICATE WILL BE ENTITLED TO REGISTRATION
RIGHTS UNDER A REGISTRATION RIGHTS AGREEMENT TO BE EXECUTED BY THE COMPANY.
(d) Registration Requirement. Notwithstanding anything else in this
Section 6, no Warrants (including any Private Warrants) may be exercised unless
at the time of exercise (i) a registration statement covering the Warrant Shares
to be issued upon exercise (other than Warrant Shares to be issued upon exercise
of any Private Warrant) is effective under the Act and (ii) a prospectus
thereunder relating to the Warrant Shares (other than Warrant Shares to be
issued upon exercise of any Private Warrant) is current. The Company shall use
its best efforts to have a registration statement in effect covering Warrant
Shares issuable upon exercise of the Warrants (other than Warrant Shares to be
issued upon exercise of any Private Warrant) from the date the Warrants become
exercisable and to maintain a current prospectus relating to those Warrant
Shares until the Warrants expire or are redeemed. In the event that, at the end
of the Warrant Exercise Period, a registration statement covering the Warrant
Shares to be issued upon exercise (other than Warrant Shares to be issued upon
exercise of any Private Warrant) is not effective under the Act, all the rights
of holders hereunder shall terminate and all of the Warrants shall expire
unexercised and worthless, and as a result purchasers of the Units will have
paid the full Unit price solely for the share of Common Stock included in each
Unit. In no event shall the Warrants be settled on a net cash basis nor shall
the Company be required to issue unregistered shares upon the exercise of any
Warrant that is not a Private Warrant.
(e) Expiry Upon Liquidation of Trust Account. If the Company is
dissolved because it fails to effect an Initial Business Combination, all of the
rights of holders hereunder shall terminate and all of the Warrants shall expire
unexercised and worthless and as a result purchasers of the Units will have paid
the full Unit purchase price solely for the share of Common Stock included in
each Unit.
(f) Forfeiture of Initial Founder's Warrants: In the event that
Steel Partners II, L.P. (or the Founding Stockholder) fails to purchase an
aggregate of 3,000,000 Units at a price of $10.00 per Unit ($30.0 million in the
aggregate) in a private placement that will occur immediately prior to the
consummation of the Initial Business Combination (the "Co-Investment") pursuant
to the terms of a Co-Investment Agreement to be entered into among the Company
and Steel Partners II, L.P., all of the Initial Founder's Warrants will become
immediately forfeited to the Company by their holders; provided that if the
Founding Stockholder purchases the Co-Investment Units, the Founder's Warrants
will not be subject to forfeiture.
SECTION 7. Payment of Taxes. The Company will pay all documentary stamp
taxes attributable to the initial issuance of Warrant Shares upon the exercise
of Warrants; provided, however, that the Company shall not be required to pay
any tax or taxes which may be payable in respect of any transfer involved in the
issue of any Warrant Certificates or any certificates for Warrant Shares in a
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name other than that of the registered holder of a Warrant Certificate
surrendered upon the exercise of a Warrant, and the Company shall not be
required to issue or deliver such Warrant Certificates unless or until the
person or persons requesting the issuance thereof shall have paid to the Company
the amount of such tax or shall have established to the satisfaction of the
Company that such tax has been paid.
SECTION 8. Mutilated or Missing Warrant Certificates. In case any of the
Warrant Certificates shall be mutilated, lost, stolen or destroyed, the Company
shall issue and the Warrant Agent shall countersign, in exchange and
substitution for and upon cancellation of the mutilated Warrant Certificate, or
in lieu of and substitution for the Warrant Certificate lost, stolen or
destroyed, a new Warrant Certificate of like tenor and representing an
equivalent number of Warrants, but only upon receipt of evidence satisfactory to
the Company and the Warrant Agent of such loss, theft or destruction of such
Warrant Certificate and indemnity, also satisfactory to the Company and the
Warrant Agent. Applicants for such new Warrant Certificates must pay such
reasonable charges as the Company may prescribe.
SECTION 9. Reservation of Warrant Shares. The Company will at all times
reserve and keep available, free from preemptive rights, out of the aggregate of
its authorized but unissued Common Stock or its authorized and issued Common
Stock held in its treasury, for the purpose of enabling it to satisfy any
obligation to issue Warrant Shares upon exercise of Warrants, the maximum number
of shares of Common Stock which may then be deliverable upon the exercise of all
outstanding Warrants. The Warrant Agent shall have no duty to verify
availability of such shares set aside by the Company.
The Company or, if appointed, the transfer agent for the Common Stock (the
"Transfer Agent") and every subsequent transfer agent for any shares of the
Company's Common Stock issuable upon the exercise of any of the Warrants will be
irrevocably authorized and directed at all times to reserve such number of
authorized shares as shall be required for such purpose. The Company will keep a
copy of this Agreement on file with the Transfer Agent and with every subsequent
transfer agent for any shares of the Company's Common Stock issuable upon the
exercise of the Warrants. The Warrant Agent is hereby irrevocably authorized to
requisition from time to time from such Transfer Agent the stock certificates
required to honor outstanding Warrants upon exercise thereof in accordance with
the terms of this Agreement. The Company will supply such Transfer Agent with
duly executed certificates for such purposes and will provide or otherwise make
available any cash which may be payable as provided in Section 12 hereof. The
Company will furnish such Transfer Agent a copy of all notices of adjustments
and certificates related thereto, transmitted to each holder pursuant to Section
13 hereof.
Before taking any action which would cause an adjustment pursuant to
Section 11 hereof to reduce the Exercise Price below the then par value (if any)
of the Warrant Shares, the Company will take any commercially reasonable
corporate action which may, in the opinion of its counsel (which may be counsel
employed by the Company), be necessary in order that the Company may validly and
legally issue fully paid and nonassessable Warrant Shares at the Exercise Price
as so adjusted.
The Company covenants that all Warrant Shares which may be issued upon
exercise of Warrants will, upon payment of the Exercise Price therefor and
issue, be fully paid, nonassessable, free of preemptive rights and free from all
taxes, liens, charges and security interests with respect to the issue thereof.
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SECTION 10. Obtaining Stock Exchange Listings; State Registration. The
Company will from time to time take all commercially reasonable actions which
may be necessary so that the Warrant Shares, immediately upon their issuance
upon the exercise of Warrants, will be listed on the principal securities
exchanges and markets within the United States of America, if any, on which
other shares of Common Stock are then listed. To the extent that the Common
Stock is not listed on a national securities exchange or there is no exemption
from state "blue sky" securities laws for the issuance of the Warrant Shares,
the Company will take all commercially reasonable actions which may be necessary
so that the Warrant Shares are registered in all states in which the holders of
the Warrants reside.
SECTION 11. Adjustment of Number of Warrant Shares.
The number of Warrant Shares issuable upon the exercise of each Warrant is
subject to adjustment from time to time upon the occurrence of the events
enumerated in this Section 11. For purposes of this Section 11, "Common Stock"
means shares now or hereafter authorized of any class of common stock of the
Company and any other stock of the Company, however designated, that has the
right (subject to any prior rights of any class or series of preferred stock) to
participate in any distribution of the assets or earnings of the Company without
limit as to per share amount.
(a) Adjustment for Change in Capital Stock.
If the Company:
(1) pays a dividend or makes a distribution on its Common
Stock in either case in shares of its Common Stock;
(2) subdivides its outstanding shares of Common Stock into a
greater number of shares;
(3) combines its outstanding shares of Common Stock into a
smaller number of shares;
(4) makes a distribution on its Common Stock in shares of its
capital stock other than Common Stock; or
(5) issues by reclassification of its Common Stock any shares
of its capital stock,
then the number of shares of Common Stock issuable upon exercise of each Warrant
immediately prior to such action shall be proportionately adjusted so that the
holder of any Warrant thereafter exercised shall receive the aggregate number
and kind of shares of capital stock of the Company which he would have owned
immediately following such action if such Warrant had been exercised immediately
prior to such action.
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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.
Such adjustment shall be made successively whenever any event listed above
shall occur.
(b) Adjustment for Rights Issue.
If the Company distributes any rights, options or warrants to all holders
of its Common Stock entitling them to purchase shares of Common Stock at a price
per share less than the Closing Price per share on the Business Day immediately
preceding the ex-dividend date for such distribution of rights, options or
warrants, the number of shares of Common Stock issuable upon exercise of each
Warrant shall be adjusted in accordance with the formula:
O + A
N' = N x -------------
O + (A x P/M)
where:
N' = the adjusted number of shares of Common Stock issuable upon exercise
of each Warrant.
N = the current number of shares of Common Stock issuable upon exercise of
each Warrant.
O = the number of shares of Common Stock outstanding on the record date
for such distribution.
A = the number of additional shares of Common Stock issuable pursuant to
such rights or warrants.
P = the purchase price per share of the additional shares.
M = the Closing Price per share of Common Stock on the record date.
The adjustment shall be made successively whenever any such rights,
options or warrants are issued and shall become effective immediately after the
record date for the determination of stockholders entitled to receive the
rights, options or warrants. If at the end of the period during which such
rights, options or warrants are exercisable, not all rights, options or warrants
shall have been exercised, the number of shares of Common Stock issuable upon
exercise of each Warrant shall be immediately readjusted to what it would have
been if "N" in the above formula had been the number of shares actually issued.
(c) Adjustment for Other Distributions.
If the Company distributes to all holders of its Common Stock any of its
assets (including cash) or debt securities or any rights, options or warrants to
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purchase debt securities, assets or other securities of the Company (other than
Common Stock), the number of shares of Common Stock issuable upon exercise of
each Warrant shall be adjusted in accordance with the formula:
M
N' = N x -----
M - F
where:
N' = the adjusted number of shares of Common Stock issuable upon exercise
of each Warrant.
N = the current number of shares of Common Stock issuable upon exercise of
each Warrant.
M = the Closing Price per share of Common Stock on the Business Day
immediately preceding the ex-dividend date for such distribution.
F = the fair market value on the ex-dividend date for such distribution of
the assets, securities, rights or warrants distributable to one share of Common
Stock after taking into account, in the case of any rights, options or warrants,
the consideration required to be paid upon exercise thereof. The Board of
Directors shall reasonably determine the fair market value in good faith.
The adjustment shall be made successively whenever any such distribution
is made and shall become effective immediately after the record date for the
determination of stockholders entitled to receive such distribution.
This subsection (c) does not apply to regular quarterly cash dividends
including increases thereof or rights, options or warrants referred to in
subsection (b) of this Section 11. If any adjustment is made pursuant to this
subsection (c) as a result of the issuance of rights, options or warrants and at
the end of the period during which any such rights, options or warrants are
exercisable, not all such rights, options or warrants shall have been exercised,
the Warrant shall be immediately readjusted as if "F" in the above formula was
the fair market value on the ex-dividend date for such distribution of the
indebtedness or assets actually distributed upon exercise of such rights,
options or warrants divided by the number of shares of Common Stock outstanding
on the ex-dividend date for such distribution. Notwithstanding anything to the
contrary contained in this subsection (c), if "M-F" in the above formula is less
than $1.00, the Company may elect to, and if "M-F" or is a negative number, the
Company shall, in lieu of the adjustment otherwise required by this subsection
(c), distribute to the holders of the Warrants, upon exercise thereof, the
evidences of indebtedness, assets, rights, options or warrants (or the proceeds
thereof) which would have been distributed to such holders had such Warrants
been exercised immediately prior to the record date for such distribution.
(d) Adjustment for Common Stock Issue.
If the Company issues shares of Common Stock for a consideration per share
less than the Closing Price per share on the date the Company fixes the offering
11
price of such additional shares, the number of shares of Common Stock issuable
upon exercise of each Warrant shall be adjusted in accordance with the formula:
A
N' = N x -------
O + P/M
where:
N' = the adjusted number of shares of Common Stock issuable upon exercise
of each Warrant.
N = the current number of shares of Common Stock issuable upon exercise of
each Warrant.
O = the number of shares outstanding immediately prior to the issuance of
such additional shares.
P = the aggregate consideration received for the issuance of such
additional shares.
M = the Closing Price per share on the date of issuance of such additional
shares.
A = the number of shares outstanding immediately after the issuance of
such additional shares.
The adjustment shall be made successively whenever any such issuance is
made, and shall become effective immediately after such issuance.
This subsection (d) does not apply to:
(1) any of the transactions described in subsections (b) and
(c) of this Section 11,
(2) the exercise of Warrants, or the conversion or exchange of
other securities convertible or exchangeable for Common Stock, or the
issuance of Common Stock upon the exercise of rights or warrants issued to
the holders of Common Stock,
(3) Common Stock (and options exercisable therefor) issued to
the Company's employees, officers, directors, consultants or advisors
(whether or not still in such capacity on the date of exercise) under bona
fide employee benefit plans or stock option plans adopted by the Board of
Directors of the Company and approved by the holders of Common Stock when
required by law, if such Common Stock would otherwise be covered by this
subsection (d),
(4) Common Stock issued in a bona fide public offering for
cash,
(5) Common Stock issued in a bona fide private placement to
non-affiliates of the Company, including without limitation the issuance
12
of equity as consideration or partial consideration for acquisitions from
persons that are not affiliates of the Company.
(e) Adjustment for Convertible Securities Issue.
If the Company issues any securities convertible into or exchangeable for
Common Stock (other than securities issued in transactions described in
subsections (b) and (c) of this Section 11) for a consideration per share of
Common Stock initially deliverable upon conversion or exchange of such
securities less than the Closing Price per share on the date of issuance of such
securities, the number of shares of Common Stock issuable upon exercise of each
Warrant shall be adjusted in accordance with this formula:
O + D
N' = N x -------
O + P/M
where:
N' = the adjusted number of shares of Common Stock issuable upon exercise
of each Warrant.
N = the current number of shares of Common Stock issuable upon exercise of
each Warrant.
O = the number of shares outstanding immediately prior to the issuance of
such securities.
P = the aggregate consideration received for the issuance of such
securities.
M = the Closing Price per share on the date of issuance of such
securities.
D = the maximum number of shares deliverable upon conversion or in
exchange for such securities at the initial conversion or exchange rate.
The adjustment shall be made successively whenever any such issuance is
made, and shall become effective immediately after such issuance.
If all of the Common Stock deliverable upon conversion or exchange of such
securities have not been issued when such securities are no longer outstanding,
then the number of shares of Common Stock issuable upon exercise of each Warrant
shall promptly be readjusted to what it would have been had the adjustment upon
the issuance of such securities been made on the basis of the actual number of
shares of Common Stock issued upon conversion or exchange of such securities.
This subsection (e) does not apply to:
(1) convertible securities issued in a bona fide public
offering for cash; or
13
(2) convertible securities issued in a bona fide private
placement to non-affiliates of the Company, including the issuance of
convertible securities as consideration or partial consideration for
acquisitions from persons that are not affiliates of the Company.
(f) Adjustment for Tender or Exchange Offer. If the Company or any
of its subsidiaries makes a payment in respect of a tender offer or exchange
offer for the Common Stock, if the cash and value of any other consideration
included in the payment per share of the Common Stock exceeds the Closing Price
of the Common Stock on the trading day next succeeding the last date on which
tenders or exchanges may be made pursuant to such tender or exchange offer, the
number of shares of Common Stock issuable upon exercise of each Warrant will be
increased based on the following formula:
AC + (SP'x OS')
N' = No x --------------
OSo x SP'
where,
N' = the adjusted number of shares of Common Stock issuable upon exercise
of each Warrant;
No = the current number of shares of Common Stock issuable upon exercise
of each warrant;
AC = the aggregate value of all cash and any other consideration (as
determined by the Board of Directors of the Company) paid or payable for shares
purchased in such tender or exchange offer;
OSo = the number of shares of Common Stock outstanding immediately prior
to the date such tender or exchange offer expires;
OS' = the number of shares of Common Stock outstanding immediately after
the date such tender or exchange offer expires; and
SP' = the Closing Price of the Common Stock on the trading day next
succeeding the date such tender or exchange offer expires.
The adjustment shall be made successively and shall become effective
immediately following the date such tender or exchange offer expires.
(g) Consideration Received.
For purposes of any computation respecting consideration received pursuant
to subsections (d), (e) and (f) of this Section 11, the following shall apply:
(1) in the case of the issuance of shares of Common Stock for
cash, the consideration shall be the amount of such cash, provided that in
no case shall any deduction be made for any commissions, discounts or
other expenses incurred by the Company for any underwriting or other sale
or disposition of the issue or otherwise in connection therewith;
14
(2) in the case of the issuance of shares of Common Stock for
a consideration in whole or in part other than cash, the consideration
other than cash shall be deemed to be the fair market value thereof as
reasonably determined by the Board of Directors of the Company
(irrespective of the accounting treatment thereof) and described in a
Board resolution which shall be filed with the Warrant Agent; and
(3) in the case of the issuance of securities convertible into
or exchangeable for shares, the aggregate consideration received therefor
shall be deemed to be the consideration received by the Company for the
issuance of such securities plus the additional minimum consideration, if
any, to be received by the Company upon the conversion or exchange thereof
for the maximum number of shares used to calculate the adjustment (the
consideration in each case to be determined in the same manner as provided
in clauses (1) and (2) of this subsection).
(h) Defined Terms; When De Minimis Adjustment May Be Deferred.
As used in this section 11:
(1) "ex-dividend date" means the first date on which the
shares of Common Stock trade on the applicable exchange or in the
applicable market, regular way, without the right to receive the issuance
or distribution in question;
(2) "trading day" means, with respect to the Common Stock or
any other security, a day during which (i) trading in the Common Stock or
such other security generally occurs, (ii) there is no market disruption
event (as defined below) and (iii) a Closing Price for the Common Stock or
such other security (other than a Closing Price referred to in the next to
last clause of such definition) is available for such day; provided that
if the Common Stock or such other security is not admitted for trading or
quotation on or by any exchange, bureau or other organization, "trading
day" will mean any Business Day;
(3) "market disruption event" means, with respect to the
Common Stock or any other security, the occurrence or existence of more
than one-half hour period in the aggregate or any scheduled trading day
for the Common Stock or such other security of any suspension or
limitation imposed on trading (by reason of movements in price exceeding
limits permitted by the stock exchange or otherwise) in the Common Stock
or such other security or in any options, contract, or future contracts
relating to the Common Stock or such other security, and such suspension
or limitation occurs or exists at any time before 1:00 p.m. (New York
time) on such day; and
(4) "Business Day" means, any day on which the American Stock
Exchange is open for trading and which is not a Saturday, a Sunday or any
other day on which banks in the City of New York, New York, are authorized
or required by law to close.
15
No adjustment in the number of shares of Common Stock issuable upon
exercise of each Warrant need be made unless the adjustment would require an
increase or decrease of at least 1% in such number. Any adjustments that are not
made shall be carried forward and taken into account in any subsequent
adjustment.
All calculations under this Section 11 shall be made to the nearest cent
or to the nearest 1/100th of a share, as the case may be.
(i) When No Adjustment Required.
No adjustment need be made for a transaction referred to in subsections
(b), (c), (d), (e) or (f) of this Section 11 if Warrant holders are to
participate, without requiring the Warrants to be exercised, in the transaction
on a basis and with notice that the Board of Directors of the Company reasonably
determines to be fair and appropriate in light of the basis and notice on which
holders of Common Stock participate in the transaction.
No adjustment need be made for a change in the par value or no par value
of the Common Stock.
To the extent the Warrants become convertible into cash, no adjustment
need be made thereafter as to the amount of cash into which such Warrants are
exercisable. Interest will not accrue on the cash.
(j) Notice of Adjustment.
Whenever the number of shares of Common Stock issuable upon exercise of
each Warrant is adjusted, the Company shall provide the notices required by
Section 13 hereof.
(k) Notice of Certain Transactions.
If:
(1) the Company takes any action that would require an
adjustment in the Exercise Price pursuant to subsections (a), (b), (c),
(d), (e) or (f) of this Section 11 and if the Company does not arrange for
Warrant holders to participate pursuant to subsection (i) of this Section
11;
(2) the Company takes any action that would require a
supplemental Warrant Agreement pursuant to subsection (l) of this Section
11; or
(3) there is a liquidation or dissolution of the Company,
the Company shall mail to Warrant holders a notice stating the proposed
record date for a dividend or distribution or the proposed effective date of a
subdivision, combination, reclassification, consolidation, merger, transfer,
lease, liquidation or dissolution. The Company shall mail the notice at least 15
days before such date. Failure to mail the notice or any defect in it shall not
affect the validity of the transaction.
16
(l) Reorganization of Company.
If the Company consolidates or merges with or into, or transfers or leases
all or substantially all its assets to, any person, upon consummation of such
transaction the Warrants shall automatically become exercisable for the kind and
amount of securities, cash or other assets which the holder of a Warrant would
have owned immediately after the consolidation, merger, transfer or lease if
such holder had exercised the Warrant immediately before the effective date of
the transaction; provided that (i) if the holders of Common Stock were entitled
to exercise a right of election as to the kind or amount of securities, cash or
other assets receivable upon such consolidation or merger, then the kind and
amount of securities, cash or other assets for which each Warrant shall become
exercisable shall be deemed to be the weighted average of the kind and amount
received per share by the holders of Common Stock in such consolidation or
merger that affirmatively make such election or (ii) if a tender or exchange
offer shall have been made to and accepted by the holders of Common Stock under
circumstances in which, upon completion of such tender or exchange offer, the
maker thereof, together with members of any group (within the meaning of Rule
13d-5(b)(1) under the Securities Exchange Act of 1934, as amended (the "Exchange
Act")) of which such maker is a part, and together with any affiliate or
associate of such maker (within the meaning of Rule 12b-2 under the Exchange
Act) and any members of any such group of which any such affiliate or associate
is a part, own beneficially (within the meaning of Rule 13d-3 under the Exchange
Act) more than 50% of the outstanding shares of Common Stock, the holder of a
Warrant shall be entitled to receive the highest amount of cash, securities or
other property to which such holder would actually have been entitled as a
shareholder if such Warrant holder had exercised the Warrant prior to the
expiration of such tender or exchange offer, accepted such offer and all of the
Common Stock held by such holder had been purchased pursuant to such tender or
exchange offer, subject to adjustments (from and after the consummation of such
tender or exchange offer) as nearly equivalent as possible to the adjustments
provided for in this Section 11. Concurrently with the consummation of any such
transaction, the corporation or other entity formed by or surviving any such
consolidation or merger if other than the Company, or the person to which such
sale or conveyance shall have been made, shall enter into a supplemental Warrant
Agreement so providing and further providing for adjustments which shall be as
nearly equivalent as may be practical to the adjustments provided for in this
Section. The successor Company shall mail to Warrant holders a notice describing
the supplemental Warrant Agreement.
If the issuer of securities deliverable upon exercise of Warrants under
the supplemental Warrant Agreement is an affiliate of the formed, surviving,
transferee or lessee corporation, that issuer shall join in the supplemental
Warrant Agreement.
If this subsection (l) applies, subsections (a), (b), (c), (d), (e) and
(f) of this Section 11 do not apply.
(m) Warrant Agent's Disclaimer.
The Warrant Agent has no duty to determine when an adjustment under this
Section 11 should be made, how it should be made or what it should be. The
Warrant Agent has no duty to determine whether any provisions of a supplemental
Warrant Agreement under subsection (l) of this Section 11 are correct. The
Warrant Agent makes no representation as to the validity or value of any
17
securities or assets issued upon exercise of Warrants. The Warrant Agent shall
not be responsible for the Company's failure to comply with this Section.
(n) When Issuance or Payment May Be Deferred.
In any case in which this Section 11 shall require that an adjustment in
the number of shares of Common Stock issuable upon exercise of each Warrant be
made effective as of a record date for a specified event, the Company may elect
to defer until the occurrence of such event (i) issuing to the holder of any
Warrant exercised after such record date the Warrant Shares and other capital
stock of the Company, if any, issuable upon such exercise over and above the
Warrant Shares and other capital stock of the Company, if any, issuable upon
such exercise on the basis of the number of shares of Common Stock issuable upon
exercise of each Warrant and (ii) paying to such holder any amount in cash in
lieu of a fractional share pursuant to Section 12 hereof; provided, however,
that the Company shall deliver to such holder a due ▇▇▇▇ or other appropriate
instrument evidencing such holder's right to receive such additional Warrant
Shares, other capital stock and cash upon the occurrence of the event requiring
such adjustment.
(o) Adjustment in Exercise Price.
Upon each event that provides for an adjustment of the number of shares of
Common Stock issuable upon exercise of each Warrant pursuant to this Section 11,
each Warrant outstanding prior to the making of the adjustment shall thereafter
have an adjusted Exercise Price (calculated to the nearest ten millionth)
obtained from the following formula:
N
E' = E x --
N'
where:
E' = the adjusted Exercise Price.
E = the Exercise Price prior to adjustment.
N' = the adjusted number of Warrant Shares issuable upon exercise of a
Warrant by payment of the adjusted Exercise Price.
N = the number of Warrant Shares previously issuable upon exercise of a
Warrant by payment of the Exercise Price prior to adjustment.
Following any adjustment to the Exercise Price pursuant to this Section
11, the amount payable, when adjusted and together with any consideration
allocated to the issuance of the Warrants, shall never be less than the par
value per Warrant Share at the time of such adjustment. Such adjustment shall be
made successively whenever any event listed above shall occur.
(p) Form of Warrants.
Irrespective of any adjustments in the number or kind of shares issuable
upon the exercise of the Warrants or the Exercise Price, Warrants theretofore or
thereafter issued may continue to express the same number and kind of shares and
Exercise Price as are stated in the Warrants initially issuable pursuant to this
Agreement.
18
(q) Other Dilutive Events.
In case any event shall occur affecting the Company, as to which the
provisions of this Section 11 are not strictly applicable, but would impact the
holders of Warrants adversely as compared to holders of Common Stock, and the
failure to make any adjustment would not fairly protect the purchase rights
represented by the Warrants in accordance with the essential intent and
principles of this Section then, in each such case, the Company shall appoint a
firm of independent public accountants, investment banking or other appraisal
firm of recognized national standing which shall give their opinion upon the
adjustment, if any, on a basis consistent with the essential intent and
principles established in this Section 11, necessary to preserve, without
dilution, the purchase rights represented by the Warrants.
The provisions of this Section 11 shall not apply until issuance of the
Public Warrants.
SECTION 12. Fractional Interests. The Company shall not be required to
issue fractional Warrant Shares on the exercise of Warrants. If more than one
Warrant shall be presented for exercise in full at the same time by the same
holder, the number of full Warrant Shares which shall be issuable upon the
exercise thereof shall be computed on the basis of the aggregate number of
Warrant Shares purchasable on exercise of the Warrants so presented. If any
fraction of a Warrant Share would, except for the provisions of this Section 12,
be issuable on the exercise of any Warrants (or specified portion thereof), the
Company shall pay an amount in cash equal to the fair market value on the day
immediately preceding the date the Warrant is presented for exercise, multiplied
by such fraction.
SECTION 13. Notices to Warrant Holders. Upon any adjustment of the
Exercise Price pursuant to Section 11, the Company shall promptly thereafter,
and in any event within five days, (i) cause to be filed with the Warrant Agent
a certificate executed by the Chief Financial Officer or principal financial
officer of the Company setting forth the number of Warrant Shares issuable upon
exercise of each Warrant after such adjustment and setting forth in reasonable
detail the method of calculation and the facts upon which such calculations are
based, and (ii) cause to be given to each of the registered holders of the
Warrant Certificates at his address appearing on the Warrant register written
notice of such adjustments by first-class mail, postage prepaid. Where
appropriate, such notice may be given in advance and included as a part of the
notice required to be mailed under the other provisions of this Section 13. The
Warrant Agent shall be fully protected in relying on any such certificate and on
any adjustment therein contained and shall not be deemed to have knowledge of
such adjustment unless and until it shall have received such certificate.
In case:
(a) the Company shall authorize the issuance to all holders of
shares of Common Stock of rights, options or warrants to subscribe for or
purchase shares of Common Stock or of any other subscription rights or warrants;
or
(b) the Company shall authorize the distribution to all holders of
shares of Common Stock of evidences of its indebtedness or assets (other than
regular cash dividends or dividends payable in shares of Common Stock or
distributions referred to in subsection (b) of Section 11 hereof); or
19
(c) of any consolidation or merger to which the Company is a party
and for which approval of any shareholders of the Company is required, or of the
conveyance or transfer of the properties and assets of the Company substantially
as an entirety, or of any reclassification or change of Common Stock issuable
upon exercise of the Warrants (other than a change in par value, or from par
value to no par value, or from no par value to par value, or as a result of a
subdivision or combination), or a tender offer or exchange offer for shares of
Common Stock; or
(d) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company; or
(e) the Company proposes to take any action not specified above
which would require an adjustment of the Exercise Price pursuant to Section 11
hereof;
then the Company shall cause to be filed with the Warrant Agent and shall cause
to be given to each of the registered holders of the Warrant Certificates at his
address appearing on the Warrant register, at least 10 calendar days prior to
the applicable record date hereinafter specified, or as promptly as practicable
under the circumstances in the case of events for which there is no record date,
by first-class mail, postage prepaid, a written notice stating (i) the date as
of which the holders of record of shares of Common Stock to be entitled to
receive any such rights, options, warrants or distribution are to be determined,
or (ii) the initial expiration date set forth in any tender offer or exchange
offer for shares of Common Stock, or (iii) the date on which any such
consolidation, merger, conveyance, transfer, dissolution, liquidation or winding
up is expected to become effective or consummated, and the date as of which it
is expected that holders of record of shares of Common Stock shall be entitled
to exchange such shares for securities or other property, if any, deliverable
upon such reclassification, consolidation, merger, conveyance, transfer,
dissolution, liquidation or winding up. The failure to give the notice required
by this Section 13 or any defect therein shall not affect the legality or
validity of any distribution, right, option, warrant, consolidation, merger,
conveyance, transfer, dissolution, liquidation or winding up, or the vote upon
any action.
Nothing contained in this Agreement or in any of the Warrant Certificates
shall be construed as conferring upon the holders thereof the right to vote or
to consent or to receive notice as shareholders in respect of the meetings of
shareholders or the election of Directors of the Company or any other matter, or
any rights whatsoever as shareholders of the Company.
SECTION 14. Merger, Consolidation or Change of Name of Warrant Agent. Any
corporation into which the Warrant Agent may be merged or with which it may be
consolidated, or any corporation resulting from any merger or consolidation to
which the Warrant Agent shall be a party, or any corporation succeeding to all
or substantially all the corporate trust or agency business of the Warrant
Agent, shall be the successor to the Warrant Agent hereunder without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, provided that such corporation would be eligible for appointment
as a successor warrant agent under the provisions of Section 16. In case at the
time such successor to the Warrant Agent shall succeed to the agency created by
this Agreement, and in case at that time any of the Warrant Certificates shall
have been countersigned but not delivered, any such successor to the Warrant
20
Agent may adopt the countersignature of the original Warrant Agent; and in case
at that time any of the Warrant Certificates shall not have been countersigned,
any successor to the Warrant Agent may countersign such Warrant Certificates
either in the name of the predecessor Warrant Agent or in the name of the
successor to the Warrant Agent; and in all such cases such Warrant Certificates
shall have the full force and effect provided in the Warrant Certificates and in
this Agreement.
In case at any time the name of the Warrant Agent shall be changed and at
such time any of the Warrant Certificates shall have been countersigned but not
delivered, the Warrant Agent whose name has been changed may adopt the
countersignature under its prior name, and in case at that time any of the
Warrant Certificates shall not have been countersigned, the Warrant Agent may
countersign such Warrant Certificates either in its prior name or in its changed
name, and in all such cases such Warrant Certificates shall have the full force
and effect provided in the Warrant Certificates and in this Agreement.
SECTION 15. Warrant Agent. The Warrant Agent undertakes the duties and
obligations imposed by this Agreement (and no implied duties or obligations
shall be read into this Agreement against the Warrant Agent) upon the following
terms and conditions, by all of which the Company and the holders of Warrants,
by their acceptance thereof, shall be bound:
(a) The statements contained herein and in the Warrant Certificates
shall be taken as statements of the Company and the Warrant Agent assumes no
responsibility for the correctness of any of the same except such as describe
the Warrant Agent or action taken or to be taken by it. The Warrant Agent
assumes no responsibility with respect to the distribution of the Warrant
Certificates except as herein otherwise provided.
(b) The Warrant Agent shall not be responsible for any failure of
the Company to comply with any of the covenants contained in this Agreement or
in the Warrant Certificates to be complied with by the Company.
(c) The Warrant Agent may consult at any time with counsel of its
own selection (who may be counsel for the Company) and the Warrant Agent shall
incur no liability or responsibility to the Company or to any holder of any
Warrant Certificate in respect of any action taken, suffered or omitted by it
hereunder in good faith and in accordance with the opinion or the advice of such
counsel. The Warrant Agent may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or through agents or attorneys and
the Warrant Agent shall not be responsible for any misconduct or negligence on
the part of any agent or attorney appointed with due care by it hereunder.
(d) The Warrant Agent may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Warrant Agent and conforming to the
requirements of this Agreement. The Warrant Agent shall incur no liability or
responsibility to the Company or to any holder of any Warrant Certificate for
any action taken in reliance on any Warrant Certificate, certificate of shares,
notice, resolution, waiver, consent, order, certificate, or other paper,
document or instrument (whether in its original or facsimile form) believed by
it to be genuine and to have been signed, sent or presented by the proper party
or parties.
21
(e) The Company agrees to pay to the Warrant Agent such compensation
for all services rendered by the Warrant Agent in the administration and
execution of this Agreement as the Company and the Warrant Agent shall agree in
writing to reimburse the Warrant Agent for all expenses, taxes and governmental
charges and other charges of any kind and nature incurred by the Warrant Agent
in the execution of this Agreement (including fees and expenses of its counsel)
and to indemnify the Warrant Agent (and any predecessor Warrant Agent) and save
it harmless against any and all claims (whether asserted by the Company, a
holder or any other person), damages, losses, expenses (including taxes other
than taxes based on the income of the Warrant Agent), liabilities, including
judgments, costs and counsel fees and expenses, for anything done or omitted by
the Warrant Agent in the execution of this Agreement except as a result of its
negligence or willful misconduct. The provisions of this Section 15(e) shall
survive the expiration of the Warrants and the termination of this Agreement.
(f) The Warrant Agent shall be under no obligation to institute any
action, suit or legal proceeding or to take any other action likely to involve
expense unless the Company or one or more registered holders of Warrant
Certificates shall furnish the Warrant Agent with security and indemnity
satisfactory to it for any costs and expenses which may be incurred, but this
provision shall not affect the power of the Warrant Agent to take such action as
it may consider proper, whether with or without any such security or indemnity.
All rights of action under this Agreement or under any of the Warrants may be
enforced by the Warrant Agent without the possession of any of the Warrant
Certificates or the production thereof at any trial or other proceeding relative
thereto, and any such action, suit or proceeding instituted by the Warrant Agent
shall be brought in its name as Warrant Agent and any recovery of judgment shall
be for the ratable benefit of the registered holders of the Warrants, as their
respective rights or interests may appear.
(g) The Warrant Agent, and any stockholder, director, officer or
employee of it, may buy, sell or deal in any of the Warrants or other securities
of the Company or become pecuniarily interested in any transaction in which the
Company may be interested, or contract with or lend money to the Company or
otherwise act as fully and freely as though it were not Warrant Agent under this
Agreement. Nothing herein shall preclude the Warrant Agent from acting in any
other capacity for the Company or for any other legal entity.
(h) The Warrant Agent shall act hereunder solely as agent for the
Company, and its duties shall be determined solely by the provisions hereof. The
Warrant Agent shall not be liable for anything that it may do or refrain from
doing in connection with this Agreement except for its own negligence or willful
misconduct. The Warrant Agent shall not be liable for any error of judgment made
in good faith by it, unless it shall be proved that the Warrant Agent was
negligent in ascertaining the pertinent facts. Notwithstanding anything in this
Agreement to the contrary, in no event shall the Warrant Agent be liable for
special, indirect, punitive or consequential loss or damage of any kind
whatsoever (including but not limited to lost profits), even if the Warrant
Agent has been advised of the likelihood of the loss or damage and regardless of
the form of the action.
22
(i) The Warrant Agent shall not at any time be under any duty or
responsibility to any holder of any Warrant Certificate to make or cause to be
made any adjustment of the Exercise Price or number of the Warrant Shares or
other securities or property deliverable as provided in this Agreement, or to
determine whether any facts exist which may require any of such adjustments, or
with respect to the nature or extent of any such adjustments, when made, or with
respect to the method employed in making the same. The Warrant Agent shall not
be accountable with respect to the validity or value or the kind or amount of
any Warrant Shares or of any securities or property which may at any time be
issued or delivered upon the exercise of any Warrant or with respect to whether
any such Warrant Shares or other securities will when issued be validly issued
and fully paid and nonassessable, and makes no representation with respect
thereto.
(j) Notwithstanding anything in this Agreement to the contrary,
neither the Company nor the Warrant Agent shall have any liability to any holder
of a Warrant Certificate or other Person as a result of its inability to perform
any of its obligations under this Agreement by reason of any preliminary or
permanent injunction or other order, decree or ruling issued by a court of
competent jurisdiction or by a governmental, regulatory or administrative agency
or commission, or any statute, rule, regulation or executive order promulgated
or enacted by any governmental authority prohibiting or otherwise restraining
performance of such obligation; provided that (i) the Company must use its
reasonable best efforts to have any such order, decree or ruling lifted or
otherwise overturned as soon as possible and (ii) nothing in this Section 15(j)
shall affect the Company's obligation under Section 6(d) to use its best efforts
to have a registration statement in effect covering the Warrant Shares issuable
upon exercise of the Warrants and to maintain a current prospectus relating to
those Warrant Shares.
(k) Any application by the Warrant Agent for written instructions
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 under this
Agreement and the date on and/or after which such action shall be taken or such
omission shall be effective. The Warrant Agent shall not be liable for any
action taken by, or omission of, the Warrant Agent in accordance with a proposal
included in such application on or after the date specified in such application
(which date shall not be less than three Business Days after the date any
officer of the Company actually receives such application, unless any such
officer shall have consented in writing to any earlier date) unless prior to
taking any such action (or the effective date in the case of an omission), the
Warrant Agent shall have received written instructions in response to such
application specifying the action to be taken or omitted.
(l) No provision of this Agreement shall require the Warrant Agent
to expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder or in the exercise of its rights.
(m) In addition to the foregoing, the Warrant Agent shall be
protected and shall incur no liability for, or in respect of, any action taken
or omitted by it in connection with its administration of this Agreement if such
acts or omissions are not the result of the Warrant Agent's reckless disregard
of its duty, gross negligence or willful misconduct and are in reliance upon (i)
the proper execution of the certification concerning beneficial ownership
appended to the form of assignment and the form of the election attached hereto
unless the Warrant Agent shall have actual knowledge that, as executed, such
certification is untrue, or (ii) the non-execution of such certification
including, without limitation, any refusal to honor any otherwise permissible
assignment or election by reason of such non-execution.
23
SECTION 16. Change of Warrant Agent. The Warrant Agent may at any time
resign as Warrant Agent upon written notice to the Company. If the Warrant Agent
shall become incapable of acting as Warrant Agent, the Company shall appoint a
successor to such Warrant Agent. If the Company shall fail to make such
appointment within a period of 30 days after it has been notified in writing of
such resignation or of such incapacity by the Warrant Agent or by the registered
holder of a Warrant Certificate, then the registered holder of any Warrant
Certificate or the Warrant Agent may apply, at the expense of the Company, to
any court of competent jurisdiction for the appointment of a successor to the
Warrant Agent. Pending appointment of a successor to such Warrant Agent, either
by the Company or by such a court, the duties of the Warrant Agent shall be
carried out by the Company. The holders of a majority of the unexercised
Warrants shall be entitled at any time to remove the Warrant Agent and appoint a
successor to such Warrant Agent. If a Successor Warrant Agent shall not have
been appointed within 30 days of such removal, the Warrant Agent may apply, at
the expense of the Company, to any court of competent jurisdiction for the
appointment of a successor to the Warrant Agent. Such successor to the Warrant
Agent need not be approved by the Company or the former Warrant Agent. After
appointment the successor to the Warrant Agent shall be vested with the same
powers, rights, duties and responsibilities as if it had been originally named
as Warrant Agent without further act or deed; but the former Warrant Agent upon
payment of all fees and expenses due it and its agents and counsel shall deliver
and transfer to the successor to the Warrant Agent any property at the time held
by it hereunder and execute and deliver any further assurance, conveyance, act
or deed necessary for the purpose. Failure to give any notice provided for in
this Section 16, however, or any defect therein, shall not affect the legality
or validity of the appointment of a successor to the Warrant Agent.
SECTION 17. Notices to Company and Warrant Agent. Any notice or demand
authorized by this Agreement to be given or made by the Warrant Agent or by the
registered holder of any Warrant Certificate to or on the Company shall be
sufficiently given or made when and if deposited in the mail, first class or
registered, postage prepaid, addressed (until another address is filed in
writing by the Company with the Warrant Agent), as follows:
SP Acquisition Holdings, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Fax No.: ▇▇▇-▇▇▇-▇▇▇▇
Attention: Chief Executive Officer
In case the Company shall fail to maintain such office or agency or shall
fail to give such notice of the location or of any change in the location
thereof, presentations may be made and notices and demands may be served at the
principal corporate trust office of the Warrant Agent.
Any notice pursuant to this Agreement to be given by the Company or by the
registered holder(s) of any Warrant Certificate to the Warrant Agent shall be
sufficiently given when and if deposited in the mail, first-class or registered,
24
postage prepaid, addressed (until another address is filed in writing by the
Warrant Agent with the Company) to the Warrant Agent as follows:
Continental Stock Transfer & Trust Company
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Compliance Department
SECTION 18. Supplements and Amendments. The Company and the Warrant Agent
may from time to time supplement or amend this Agreement without the approval of
any holders of Warrant Certificates in order to cure any ambiguity or to correct
or supplement any provision contained herein which may be defective or
inconsistent with any other provision herein, or to make any other provisions in
regard to matters or questions arising hereunder which the Company and the
Warrant Agent may deem necessary or desirable and which shall not in any way
adversely affect the interests of the holders of Warrant Certificates
theretofore issued. Upon the delivery of a certificate from an appropriate
officer of the Company that states that the proposed supplement or amendment is
in compliance with the terms of this Section 18, the Warrant Agent shall execute
such supplement or amendment. Notwithstanding anything in this Agreement to the
contrary, the prior written consent of the Warrant Agent must be obtained in
connection with any supplement or amendment that alters the rights or duties of
the Warrant Agent. The Company and the Warrant Agent may amend any provision
herein with the consent of the holders of Warrants exercisable for a majority of
the Warrant Shares issuable on exercise of all outstanding Warrants that would
be affected by such amendment. Without limiting the generality of the foregoing,
prior to the issuance of any Public Warrants, this Agreement (including EXHIBIT
A hereto) may be amended by the Company and the Warrant Agent, without the
consent of any holder of Private Warrants, to modify in any way or provide for
the terms of the Public Warrants.
SECTION 19. Successors. All the covenants and provisions of this Agreement
by or for the benefit of the Company or the Warrant Agent shall bind and inure
to the benefit of their respective successors and assigns hereunder.
SECTION 20. Termination. This Agreement will terminate on any earlier date
if all Warrants have been exercised or expired without exercise. The provisions
of Section 15 hereof shall survive such termination.
SECTION 21. Governing Law. This Agreement and each Warrant Certificate
issued hereunder shall be deemed to be a contract made under the laws of the
State of New York and for all purposes shall be construed in accordance with the
internal laws of said State. The parties agree that, all actions and proceedings
arising out of this Agreement or any of the transactions contemplated hereby,
shall be brought in the United States District Court for the Southern District
of New York or in a New York State Court in the County of New York and that, in
connection with any such action or proceeding, submit to the jurisdiction of,
and venue in, such court. Each of the parties hereto also irrevocably waives all
right to trial by jury in any action, proceeding or counterclaim arising out of
this Agreement or the transactions contemplated hereby.
25
SECTION 22. Benefits of This Agreement. Nothing in this Agreement shall be
construed to give to any person or corporation other than the Company, the
Warrant Agent and the registered holders of the Warrant Certificates any legal
or equitable right, remedy or claim under this Agreement, and this Agreement
shall be for the sole and exclusive benefit of the Company, the Warrant Agent
and the registered holders of the Warrant Certificates.
SECTION 23. Counterparts. This Agreement may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute but one and
the same instrument.
SECTION 24. Force Majeure. In no event shall the Warrant Agent be
responsible or liable for any failure or delay in the performance of its
obligations under this Agreement arising out of or caused by, directly or
indirectly, forces beyond its reasonable control, including without limitation
strikes, work stoppages, accidents, acts of war or terrorism, civil or military
disturbances, nuclear or natural catastrophes or acts of God, and interruptions,
loss or malfunctions of utilities, communications or computer (software or
hardware) services.
26
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, as of the day and year first above written.
SP ACQUISITION HOLDINGS, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇
Title: Chairman of the Board of
Directors, President and
Chief Executive Officer
CONTINENTAL STOCK TRANSFER & TRUST
COMPANY, as Warrant Agent
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chief Operating Officer
27
EXHIBIT A
[Form of Warrant Certificate]
[Face]
Warrant Certificate
SP ACQUISITION HOLDINGS, INC.
This Warrant Certificate certifies that ________________________, or
registered assigns, is the registered holder of __________ warrants (the
"Warrants") to purchase shares of Common Stock, $.001 par value (the "Common
Stock"), of SP Acquisition Holdings, Inc., a Delaware corporation (the
"Company"). Each Warrant entitles the holder, upon exercise during the period
set forth in the Warrant Agreement referred to below, to receive from the
Company that number of fully paid and nonassessable shares of Common Stock
(each, a "Warrant Share") as set forth below at the exercise price (the
"Exercise Price") as determined pursuant to the Warrant Agreement payable in
lawful money of the United States of America upon surrender of this Warrant
Certificate and payment of the Exercise Price at the office or agency of the
Warrant Agent, but only subject to the conditions set forth herein and in the
Warrant Agreement.
Each Warrant is initially exercisable for one share of Common Stock. The
number of Warrant Shares issuable upon exercise of the Warrants are subject to
adjustment upon the occurrence of certain events set forth in the Warrant
Agreement.
The initial Exercise Price per share of Common Stock for any Warrant is
equal to $7.50 per share. The Exercise Price is subject to adjustment upon the
occurrence of certain events set forth in the Warrant Agreement.
Warrants may be exercised only during the Warrant Exercise Period subject
to the conditions set forth in the Warrant Agreement and to the extent not
exercised by the end of such Warrant Exercise Period such Warrants shall become
void.
Reference is hereby made to the further provisions of this Warrant
Certificate set forth on the reverse hereof and such further 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 countersigned by the
Warrant Agent, as such term is used in the Warrant Agreement.
A-1
This Warrant Certificate shall be governed and construed in accordance
with the internal laws of the State of New York, without regard to conflicts of
laws principles thereof.
SP ACQUISITION HOLDINGS, INC.
By: ___________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇
Title: Chairman of the Board of
Directors, President and
Chief Executive Officer
Countersigned:
Dated: , 20
CONTINENTAL STOCK TRANSFER & TRUST
COMPANY,
as Warrant Agent
By _______________________________
Authorized Signatory
A-2
[Form of Warrant Certificate]
[Reverse]
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants entitling the holder on exercise to receive shares
of Common Stock, par value $0.001 per share, of the Company (the "Common
Stock"), and are issued or to be issued pursuant to a Warrant Agreement dated as
of March 22, 2007 (the "Warrant Agreement"), duly executed and delivered by the
Company to Continental Stock Transfer & Trust Company, a New York corporation,
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. A copy of the Warrant Agreement may be
obtained by the holder hereof upon written request to the Company. Defined terms
used in this Warrant Certificate but not defined herein shall have the meanings
given to them in the Warrant Agreement.
Warrants may be exercised at any time during the Warrant Exercise Period
set forth in the Warrant Agreement. The holder of Warrants evidenced by this
Warrant Certificate may exercise them by surrendering this Warrant Certificate,
with the form of election to purchase set forth hereon properly completed and
executed, together with payment of the Exercise Price as specified in the
Warrant Agreement at the principal corporate trust office of the Warrant Agent.
In the event that upon any exercise of Warrants evidenced hereby the number of
Warrants exercised shall be less than the total number of Warrants evidenced
hereby, there shall be issued to the holder hereof or his assignee a new Warrant
Certificate evidencing the number of Warrants not exercised. No adjustment shall
be made for any dividends on any Common Stock issuable upon exercise of this
Warrant.
Notwithstanding anything else in this Warrant Certificate or the Warrant
Agreement, no Warrant may be exercised unless at the time of exercise (i) a
registration statement covering the Warrant Shares to be issued upon exercise
(other than Warrant Shares to be issued upon exercise of any Private Warrant) is
effective under the Act and (ii) a prospectus thereunder relating to the Warrant
Shares (other than Warrant Shares to be issued upon exercise of any Private
Warrant) is current. In no event shall the Warrants be settled on a net cash
basis during the Warrant Exercise Period nor shall the Company be required to
issue unregistered shares upon the exercise of any Warrant that is not a Private
Warrant.
The Warrant Agreement provides that upon the occurrence of certain events
the number of Warrant Shares set forth on the face hereof may, subject to
certain conditions, be adjusted. No fractions of a share of Common Stock will be
issued upon the exercise of any Warrant, but the Company will pay the cash value
thereof determined as provided in the Warrant Agreement.
Warrant Certificates, when surrendered at the principal corporate trust
office of the Warrant Agent by the registered holder thereof in person or by
legal representative or attorney duly authorized in writing, may be exchanged,
in the manner and subject to the limitations provided in the Warrant Agreement,
but without payment of any service charge, for another Warrant Certificate or
Warrant Certificates of like tenor evidencing in the aggregate a like number of
Warrants.
A-3
Upon due presentation for registration of transfer of this Warrant
Certificate at the office of the Warrant Agent a new Warrant Certificate or
Warrant Certificates of like tenor and evidencing in the aggregate a like number
of Warrants shall be issued to the transferee(s) in exchange for this Warrant
Certificate, subject to the limitations provided in the Warrant Agreement,
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(s) thereof as the absolute owner(s) of this Warrant Certificate
(notwithstanding any notation of ownership or other writing hereon made by
anyone), for the purpose of any exercise hereof, of any distribution to the
holder(s) hereof, and for all other purposes, and neither the Company nor the
Warrant Agent shall be affected by any notice to the contrary. Neither the
Warrants nor this Warrant Certificate entitles any holder hereof to any rights
of a stockholder of the Company.
A-4
Election to Purchase
(To Be Executed Upon Exercise Of Warrant)
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to receive __________ shares of Common
Stock and herewith tenders payment for such shares to the order of SP
Acquisition Holdings, Inc. in the amount of $______ in accordance with the terms
hereof. The undersigned requests that a certificate for such shares be
registered in the name of ________________, whose address is
_______________________________ and that such shares be delivered to
________________ whose address is ___________ ______________________. If said
number of shares is less than all of the shares of Common Stock purchasable
hereunder, the undersigned requests that a new Warrant Certificate representing
the remaining balance of such shares be registered in the name of
______________, whose address is _________________________, and that such
Warrant Certificate be delivered to _________________, whose address is
__________________.
Signature:
Date: , 20
Signature Guaranteed:
A-5
EXHIBIT B
LEGEND FOR PRIVATE WARRANTS
THE SECURITIES REPRESENTED BY THIS CERTIFICATE (INCLUDING THE SHARES OF
COMMON STOCK OF THE COMPANY ISSUABLE UPON EXERCISE OF SUCH SECURITIES) HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED OR ANY STATE
SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD, TRANSFERRED OR OTHERWISE DISPOSED
OF UNLESS REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND ANY
APPLICABLE STATE SECURITIES LAWS OR AN EXEMPTION FROM REGISTRATION IS AVAILABLE.
IN ADDITION, THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
CERTAIN TRANSFER RESTRICTIONS SET FORTH IN THE WARRANT AGREEMENT REFERRED TO
HEREIN [AND ARE SUBJECT TO FORFEITURE IN CERTAIN CIRCUMSTANCES].(1)
SECURITIES EVIDENCED BY THIS CERTIFICATE AND SHARES OF COMMON STOCK OF THE
COMPANY ISSUABLE UPON EXERCISE OF SUCH SECURITIES WILL BE ENTITLED TO
REGISTRATION RIGHTS UNDER A REGISTRATION RIGHTS AGREEMENT TO BE EXECUTED BY THE
COMPANY.
No. _____ _______ Warrants
----------
(1) Only applies to Initial Founder's Warrants.