EXHIBIT 4.01
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WARRANT AGREEMENT
Dated as of
August 13, ▇▇▇▇
▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ TRUST COMPANY OF NEW YORK,
as Warrant Agent
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Warrants for
Class A Common Stock of
Intersil Holding Corporation
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TABLE OF CONTENTS
Page
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ARTICLE I
Definitions
SECTION 1.01. Definitions.....................................................1
SECTION 1.02. Other Definitions...............................................5
SECTION 1.03. Rules of Construction...........................................6
ARTICLE II
Warrant Certificates
SECTION 2.01. Form and Dating.................................................6
SECTION 2.02. Execution and Countersignature..................................8
SECTION 2.03. Certificate Register............................................9
SECTION 2.04. Transfer and Exchange...........................................9
SECTION 2.05. Certificated Warrants..........................................16
SECTION 2.06. Replacement Certificates.......................................16
SECTION 2.07. Outstanding Warrants...........................................17
SECTION 2.08. Temporary Certificates.........................................17
SECTION 2.09. Cancelation....................................................17
SECTION 2.10. CUSIP Numbers..................................................17
ARTICLE III
Exercise Terms
SECTION 3.01. Exercise.......................................................18
SECTION 3.02. Exercise Periods...............................................18
SECTION 3.03. Expiration.....................................................18
SECTION 3.04. Manner of Exercise.............................................18
SECTION 3.05. Issuance of Warrant Shares.....................................19
SECTION 3.06. Fractional Warrant Shares......................................20
SECTION 3.07. Reservation of Warrant Shares..................................20
SECTION 3.08. Compliance with Law............................................21
ARTICLE IV
Antidilution Provisions
SECTION 4.01. Changes in Common Stock........................................21
SECTION 4.02. Cash Dividends and Other
Distributions.............................................22
SECTION 4.03. Common Stock Issue.............................................23
SECTION 4.04. Issuance of Rights or Options..................................24
SECTION 4.05. Combination; Liquidation.......................................25
SECTION 4.06. Other Events...................................................25
SECTION 4.07. Superseding Adjustment.........................................26
SECTION 4.08. Minimum Adjustment.............................................26
SECTION 4.09. Notice of Adjustment...........................................27
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SECTION 4.10. Notice of Certain Transactions.................................27
SECTION 4.11. Adjustment to Warrant Certificate..............................28
ARTICLE V
Registration Rights; Indemnification
SECTION 5.01. Effectiveness of Registration
Statement.................................................29
SECTION 5.02. Suspension.....................................................30
SECTION 5.03. Blue Sky.......................................................31
SECTION 5.04. Accuracy of Disclosure.........................................31
SECTION 5.05. Indemnification................................................31
SECTION 5.06. Additional Acts................................................35
SECTION 5.07. Expenses.......................................................36
ARTICLE VI
Warrant Agent
SECTION 6.01. Appointment of Warrant Agent...................................36
SECTION 6.02. Rights and Duties of Warrant Agent.............................36
SECTION 6.03. Individual Rights of Warrant Agent.............................37
SECTION 6.04. Warrant Agent's Disclaimer.....................................38
SECTION 6.05. Compensation and Indemnity.....................................38
SECTION 6.06. Successor Warrant Agent........................................38
ARTICLE VII
Option Agreement
SECTION 7.01. Option Agreement...............................................40
ARTICLE VIII
Miscellaneous
SECTION 8.01. SEC Reports....................................................40
SECTION 8.02. Persons Benefitting............................................41
SECTION 8.03. Rights of Holders..............................................41
SECTION 8.04. Amendment......................................................41
SECTION 8.05. Notices........................................................42
SECTION 8.06. Governing Law..................................................43
SECTION 8.07. Successors.....................................................43
SECTION 8.08. Multiple Originals.............................................43
SECTION 8.09. Table of Contents..............................................43
SECTION 8.10. Severability...................................................43
EXHIBIT A Form of Face of Warrant Certificate
WARRANT AGREEMENT dated as of August 13, 1999 (this "Agreement"), between
INTERSIL HOLDING CORPORATION, a Delaware corporation (the "Company"), and UNITED
STATES TRUST COMPANY OF NEW YORK, a New York banking corporation, as Warrant
Agent (the "Warrant Agent").
The Company desires to issue the warrants (the "Warrants") described
herein. The Warrants will initially entitle the holders thereof (the "Holders")
to purchase, in the aggregate, 5,555,560 shares of Class A Common Stock, par
value $0.01 per share, of the Company ("Class A Common Stock") in connection
with an offering (the "Offering") by the Company and Intersil Corporation of
200,000 units (the "Units"). Each Unit consists of (i) one 13 1/4% Senior
Subordinated Note Due 2009 with a principal amount at maturity of $1,000 (a
"Note") and (ii) one warrant (each, a "Warrant") to purchase 27.7778 shares of
Class A Common Stock.
The Warrants will not trade separately from the Notes until the earliest
date (the "Separation Date") to occur of: (i) the commencement of a registered
exchange offer for the Notes, (ii) the effective date of a shelf registration
statement with respect to the Notes and (iii) such earlier date after October
12, 1999, as may be determined by the Initial Purchasers (as defined herein).
The Company further desires the Warrant Agent to act on behalf of the
Company in connection with the issuance of the Warrants as provided herein and
the Warrant Agent is willing to so act.
Each party agrees as follows for the benefit of the other party and for the
equal and ratable benefit of the Holders of Warrants:
ARTICLE I
Definitions
SECTION 1.01. Definitions.
"Affiliate" of any Person means (i) any other Person which, directly or
indirectly, is in control of, is controlled by or is under common control with
such Person, or (ii) any other Person who is a director or executive officer (A)
of such Person, (B) of any subsidiary of such
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Person or (C) of any Person described in clause (i) above. For purposes hereof,
(a) "control" of a Person means the power, direct or indirect, to direct or
cause the direction of the management and policies of such Person whether by
contract or otherwise and (b) beneficial ownership of 5% or more of the voting
common equity (on a fully diluted basis) or warrants to purchase such equity
(whether or not currently exercisable) of a Person shall be deemed to be in
control of such Person; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Board" means the Board of Directors of the Company or any committee
thereof duly authorized to act on behalf of such Board of Directors.
"Business Day" means each day that is not a Saturday, a Sunday or a day on
which banking institutions are not required to be open in the State of New York.
"Capital Stock" of any Person means any and all shares, interests, rights
to purchase, warrants, options, participations or other equivalents of or
interests in (however designated) equity of such Person, including any Preferred
Stock, but excluding any debt securities convertible into such equity.
"Cashless Exercise Ratio" means a fraction, the numerator of which is the
excess of the Current Market Value per share of Class A Common Stock on the
Exercise Date over the Exercise Price per share as of the Exercise Date and the
denominator of which is the Current Market Value per share of the Class A Common
Stock on the Exercise Date.
"Certificated Warrants" means certificated Warrants in fully registered
definitive form.
"Class B Common Stock" means the $0.01 par value Class B Common Stock of
the Company.
"Combination" means an event in which the Company consolidates with, merges
with or into, or sells all or substantially all of its assets to, another
Person.
"Common Stock" means the Class A Common Stock and the Class B Common
Stock".
"Current Market Value" per share of Class A Common Stock 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 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, the closing of which shall have occurred on such date
or within the six-month period preceding such date, or (b) if
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no such transaction shall have occurred on such date or within such six-month
period, the value of the security as determined by an independent financial
expert or (ii) if the security is registered under the Exchange Act, the average
of the daily closing bid prices (or the equivalent in an over-the-counter
market) for each Business Day during the period commencing 15 Business Days
before such date and ending on the date one day prior to such date, or if the
security has been registered under the Exchange Act for less than 15 consecutive
Business Days before such date, then the average of the daily closing bid prices
(or such equivalent) for all of the Business Days before such date for which
daily closing bid prices are available; provided, however, that if the closing
bid price is not determinable for at least ten Business Days in such period, the
"Current Market Value" of the security shall be determined as if the security
were not registered under the Exchange Act.
"Depositary" means The Depository Trust Company, its nominees and their
respective successors.
"Exchange Act" means the U.S. Securities Exchange Act of 1934, as amended.
"Exercise Date" means, for a given Warrant, the day on which such Warrant
is exercised pursuant to Section 3.04.
"Extraordinary Cash Dividend" means that portion, if any, of the aggregate
amount of all dividends paid by the Company on the Common Stock in any fiscal
year that exceeds $10 million.
"Indenture" means the Indenture dated as of August 13, 1999, among Intersil
Corporation, the Company, the Subsidiary Guarantors named therein and the
Trustee, with respect to the Notes, as it may be amended or supplemented from
time to time.
"Initial Purchasers" means Credit Suisse First Boston Corporation, ▇.▇.
▇▇▇▇▇▇ Securities Inc. and ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
"Intersil Corporation" means Intersil Corporation, a Delaware corporation
and wholly owned subsidiary of the Company.
"Issue Date" means the date on which the Warrants are initially issued.
"Offering Circular" means the Confidential Offering Circular dated August
6, 1999, of the Company and Intersil Corporation.
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"Officer" means the Chairman of the Board, the President, any Vice
President, the Treasurer, or an Assistant Treasurer, or the Secretary or an
Assistant Secretary of the Company.
"Officers' Certificate" means a certificate signed by two Officers.
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the Warrant Agent. Such counsel may be an employee of
or counsel to the Company or the Warrant Agent.
"Person" means any individual, corporation, partnership, joint venture,
limited liability company, joint venture, association, joint-stock company,
trust, unincorporated organization, government or any agency or political
subdivision thereof or any other entity.
"Preferred Stock", as applied to the Capital Stock of any Person, means
Capital Stock of any class or classes (however designated) which is preferred as
to the payment of dividends or distributions, or as to the payment of assets
upon any voluntary or involuntary liquidation or dissolution of such Person,
over shares of Capital Stock of any other class of such Person.
"Purchase Agreement" means the Purchase Agreement dated August 6, 1999,
among Intersil Corporation, the Company, the Subsidiary Guarantors named therein
and the Initial Purchasers.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Regulation S" means Regulation S under the Securities Act.
"Rule 144A" means Rule 144A under the Securities Act.
"SEC" means the Securities and Exchange Commission.
"Securities" means the Warrants and the Warrant Shares.
"Securities Act" means the U.S. Securities Act of 1933, as amended.
"Transfer Restricted Securities" means the Warrants and the Class A Common
Stock which may be issued to Holders upon exercise of the Warrants, whether or
not such exercise has been effected. Each such security shall cease to be a
Transfer Restricted Security when (i) it has been
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disposed of pursuant to a registration statement of the Company filed with the
SEC and declared effective by the SEC that covers the disposition of such
Transfer Restricted Security, (ii) it has been distributed pursuant to Rule 144
promulgated under the Securities Act (or any similar provisions under the
Securities Act then in effect) or (iii) it may be resold without registration
under the Securities Act, whether pursuant to Rule 144(k) under the Securities
Act or otherwise.
"Trustee" means United States Trust Company of New York, or any successor
trustee under the Indenture.
"Warrant Certificates" mean the registered certificates (including the
Global Warrants) issued by the Company under this Agreement representing the
Warrants.
"Warrant Custodian" means the custodian with respect to a Global Warrant
(as appointed by the Depositary) or any successor person thereto and shall
initially be the Warrant Agent.
"Warrant Shares" mean the shares of Class A Common Stock (and any other
securities) for which the Warrants are exercisable or which have been issued
upon exercise of Warrants.
SECTION 1.02. Other Definitions.
Defined in
Term Section
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"Agreement"........................................................ Recitals
"Agent Members".................................................... 2.01(b)
"Cashless Exercise"................................................ 3.04
"Certificate Register"............................................. 2.03
"Common Shelf Registration Statement".............................. 5.01
"Class A Common Stock"............................................. Recitals
"Company".......................................................... Recitals
"Definitive Warrant"............................................... 2.01(c)
"Exercise Price"................................................... 3.01
"Expiration Date".................................................. 3.02(b)
"Global Warrant"................................................... 2.01(a)
"Holders".......................................................... Recitals
"Indemnified Parties".............................................. 5.05(a)
"Offering"......................................................... Recitals
"Registration Statement"........................................... 5.01
"Separability Legend".............................................. 2.04(e)
"Separation Date".................................................. Recitals
"Stock Transfer Agent"............................................. 3.05
"Successor Company"................................................ 4.05(a)
"Units"............................................................ Recitals
"Warrant".......................................................... Recitals
"Warrant Agent".................................................... Recitals
"Warrant Shelf Registration Statement"............................. 5.01
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SECTION 1.03. Rules of Construction. Unless the text otherwise requires:
(i) a defined term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning assigned to
it in accordance with generally accepted accounting principles as in effect
from time to time;
(iii) "or" is not exclusive;
(iv) "including" means including, without limitation; and
(v) words in the singular include the plural and words in the plural
include the singular.
ARTICLE II
Warrant Certificates
SECTION 2.01. Form and Dating. The Warrants shall be offered and sold by
the Company pursuant to the Purchase Agreement. Each Warrant shall initially be
issued as part of a Unit consisting of one Note and one Warrant. Prior to the
Separation Date, the Warrants may not be transferred or exchanged separately
from, but may be transferred or exchanged only together with, the Notes attached
to such Warrants. Prior to the Separation Date, the transfer agent for the Notes
shall act as transfer agent ("Note Transfer Agent") for both the Warrants and
the Notes. Any request for transfer of a Warrant prior to the Separation Date
made to the Note Transfer Agent shall be accompanied by the Note attached
thereto and the Note Transfer Agent will not execute any such transfer without
such Note attached thereto. Such Warrant and Note will be duly endorsed and
accompanied by a written instrument of transfer in form satisfactory to the
Company, duly executed by the Holder thereof or the Holder's attorneys duly
authorized in writing. In the event of the commencement of a registered exchange
offer for the Notes or the effectiveness of a shelf registration statement with
respect to the Notes, the Company shall provide notice to the Note Transfer
Agent and the Warrant Agent of the Separation Date not less than two Business
Days prior to such date and the Company will cause the Note Transfer Agent to
notify the Depositary of such date. In the event of a determination by the
Initial Purchasers to separate the Warrants and the Notes, the Company shall
promptly, but in no event later than the next following Business Day after
receiving notice of such determination, provide notice to the Note Transfer
Agent and the Warrant Agent of the Separation Date and cause
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the Note Transfer Agent to notify the Depositary of such date. In acting as the
transfer agent for the Warrants prior to the Separation Date, the Note Transfer
Agent shall be entitled to all the rights, privileges and immunities to which
the Warrant Agent is entitled in performing such role pursuant to the terms of
this Agreement.
(a) Global Warrants. Warrants offered and sold to a QIB in reliance on Rule
144A, as provided in the Purchase Agreement, shall be issued initially in the
form of one or more permanent Global Warrants in definitive, fully registered
form with the Global securities legend and restricted securities legend set
forth in Exhibit A hereto (each, a "Global Warrant"), which shall be deposited
on behalf of the Initial Purchasers with, subject to the first paragraph of this
Section 2.01, the Warrant Agent, as custodian for the Depositary (or with such
other custodian as the Depositary may direct), and registered in the name of the
Depositary or a nominee of the Depositary, duly executed by the Company and
countersigned by the Warrant Agent as hereinafter provided. The number of
Warrants represented by the Global Warrant may from time to time be increased or
decreased by adjustments made on the records of the Warrant Agent and the
Depositary or its nominee as hereinafter provided.
(b) Book-Entry Provisions. (i) This Section 2.01(b) shall apply only to a
Global Warrant deposited with or on behalf of the Depositary.
The Company shall execute and the Warrant Agent shall, in accordance with
Section 2.02, countersign and deliver initially one or more Global Warrants that
(a) shall be registered in the name of the Depositary for such Global Warrant or
Global Warrants or the nominee of the Depositary and (b) shall be delivered by
the Warrant Agent to the Depositary or pursuant to the Depositary's instructions
or held by the Warrant Agent as custodian for the Depositary.
(ii) Members of, or participants in, the Depositary ("Agent Members") shall
have no rights under this Agreement with respect to any Global Warrant held on
their behalf by the Depositary or by the Warrant Agent as the custodian of the
Depositary or under such Global Warrant, and the Depositary may be treated by
the Company, the Warrant Agent and any agent of the Company or the Warrant Agent
as the absolute owner of such Global Warrant for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the Company, the
Warrant Agent or any agent of the Company or the Warrant Agent from giving
effect to any written certification, proxy or other authorization furnished by
the Depositary or impair, as between the Depositary and its Agent Members, the
operation of customary practices of the Depositary governing the exercise of the
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rights of a holder of a beneficial interest in any Global Warrant.
(c) Certificated Securities. Except as provided in this Section 2.01 or
Section 2.03 or 2.04, owners of beneficial interests in Global Warrants will not
be entitled to receive physical delivery of certificated Warrants. Warrants
offered and sold in reliance on Regulation S under the Securities Act
("Regulation S"), as provided in the Purchase Agreement, will be issued
initially in the form of individual certificates in definitive, fully registered
form and with the restricted securities legend set forth in Exhibit A hereto
(each, a "Definitive Warrant"); provided, however, that upon transfer of any
such Definitive Warrant to a QIB in accordance with the provisions of this
Agreement, such Definitive Warrant will be exchanged for an interest in a Global
Warrant pursuant to the provisions of Section 2.04.
SECTION 2.02. Execution and Countersignature. Two Officers shall sign the
Warrant Certificates for the Company by manual or facsimile signature.
If an Officer whose signature is on a Warrant Certificate no longer holds
that office at the time the Warrant Agent countersigns the Warrant Certificate,
the Warrants evidenced by such Warrant Certificate shall be valid nevertheless.
The Warrant Agent shall initially countersign and deliver Warrant
Certificates entitling the Holders thereof to purchase in the aggregate not more
than 5,555,560 Warrant Shares upon a written order of the Company signed by two
Officers of the Company.
The Warrant Agent may appoint an agent reasonably acceptable to the Company
to countersign the Warrant Certificates. Unless limited by the terms of such
appointment, such agent may countersign Warrant Certificates whenever the
Warrant Agent may do so. Each reference in this Agreement to countersignature by
the Warrant Agent includes countersignature by such agent. Such agent will have
the same rights as the Warrant Agent for service of notices and demands.
At any time and from time to time after the execution of this Agreement,
the Warrant Agent or an agent reasonably acceptable to the Company shall upon
receipt of a written order of the Company signed by two Officers of the Company
manually countersign for original issue a Warrant Certificate evidencing the
number of Warrants specified in such order; provided that the Warrant Agent
shall be entitled to receive an Officers' Certificate and an Opinion of Counsel
of the Company that it may reasonably request in connection with such
countersignature of Warrants. Such
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order shall specify the number of Warrants to be evidenced on the Warrant
Certificate to be countersigned, the date on which such Warrant Certificate is
to be countersigned and the number of Warrants then authorized.
The Warrants evidenced by a Warrant Certificate shall not be valid until an
authorized signatory of the Warrant Agent or its agent as provided above
manually countersigns the Warrant Certificate. The signature shall be conclusive
evidence that the Warrant Certificate has been countersigned under this
Agreement.
SECTION 2.03. Certificate Register. The Warrant Agent shall keep a register
("Certificate Register") of the Warrant Certificates and of their transfer and
exchange. The Certificate Register shall show the names and addresses of the
respective Holders and the date and number of Warrants evidenced on the face of
each of the Warrant Certificates. The Company and the Warrant Agent may deem and
treat the Person in whose name a Warrant Certificate is registered as the
absolute owner of such Warrant Certificate for all purposes whatsoever and
neither the Company nor the Warrant Agent shall be affected by notice to the
contrary.
SECTION 2.04. Transfer and Exchange. (a) Transfer and Exchange of
Definitive Warrants. When Definitive Warrants are presented to the Warrant Agent
with a request:
(x) to register the transfer of such Definitive Warrants; or
(y) 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 its reasonable requirements for such transaction are met; provided, however,
that the Definitive Warrants surrendered for transfer or exchange:
(i) shall be duly endorsed or accompanied by a written instrument of
transfer in form reasonably satisfactory to the Company and the Warrant Agent,
duly executed by the Holder thereof or his attorney duly authorized in
writing; and
(ii) if being transferred or exchanged pursuant to an effective
registration statement under the Securities Act, pursuant to Section 2.04(b)
or pursuant to clause (A), (B) or (C) below, shall be accompanied by the
following additional information and documents, as applicable:
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(A) if such Definitive 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 the form set
forth on the reverse of the Warrant); or
(B) if such Definitive Warrants are being transferred to the Company,
a certification to that effect (in the form set forth on the reverse of the
Warrant); or
(C) if such Definitive Warrants are being transferred (w) pursuant to
an exemption from registration in accordance with Rule 144A, Regulation S
or Rule 144 under the Securities Act; or (x) in reliance on another
exemption from the registration requirements of the Securities Act: (1) a
certification to that effect (in the form set forth on the reverse of the
Warrant) and (2) if the Company or Warrant Agent so requests, an opinion of
counsel or other evidence reasonably satisfactory to them as to the
compliance with the restrictions set forth in the legend set forth in
Section 2.04(e)(i).
(b) Restrictions on Transfer of a Definitive Warrant for a Beneficial
Interest in a Global Warrant. A Definitive Warrant may not be exchanged 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:
(i) certification, in the form set forth on the reverse of the Warrant,
that such Definitive Warrant is being transferred to a QIB in accordance with
Rule 144A; and
(ii) written instructions directing the Warrant Agent to make an adjustment
on its books and records with respect to such Global Warrant to reflect an
increase in the aggregate number of the Warrants represented by the Global
Warrant, such instructions to contain information regarding the Depositary
account to be credited with such increase;
then the Warrant Agent shall cancel such Definitive Warrant and cause, in
accordance with the standing instructions and procedures existing between the
Depositary and the Warrant Agent, the aggregate number of Warrants represented
by the Global Warrant to be increased by the aggregate number of Definitive
Warrants to be exchanged and shall credit or cause to be credited to the account
of the Person specified
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in such instructions a beneficial interest in the Global Warrant equal to the
number of Definitive Warrants so canceled. If no Global Warrants are then
outstanding, the Company shall execute and the Warrant Agent shall countersign
and deliver, upon written order of the Company in the form of an Officers'
Certificate, a new Global Warrant in the appropriate number.
(c) Transfer and Exchange of Global Warrants. (i) The transfer and exchange
of Global Warrants or beneficial interests therein shall be effected through the
Depositary, in accordance with this Agreement (including applicable restrictions
on transfer set forth herein) and the procedures of the Depositary therefor. A
transferor of a beneficial interest in a Global Warrant shall deliver to the
Warrant Agent a written order given in accordance with the Depositary's
procedures containing information regarding the participant account of the
Depositary to be credited with a beneficial interest in the Global Warrant. The
Warrant Agent shall, in accordance with such instructions instruct the
Depositary to credit to the account of the Person specified in such instructions
a beneficial interest in the Global Warrant and to debit the account of the
Person making the transfer the beneficial interest in the Global Warrant being
transferred.
(ii) Notwithstanding any other provisions of this Agreement (other than the
provisions set forth in Section 2.05), a Global Warrant may not be transferred
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 or any such nominee to a successor Depositary or a nominee
of such successor Depositary.
(iii) In the event that a Global Warrant is exchanged for Warrants in
definitive registered form pursuant to Section 2.05 or Section 2.08, prior to
the effectiveness of a Warrant Shelf Registration Statement with respect to such
Warrants, such Warrants may be exchanged only in accordance with such procedures
as are substantially consistent with the provisions of this Section 2.04
(including the certification requirements set forth on the reverse of the
Warrants intended to ensure that such transfers comply with Rule 144A or
Regulation S, as the case may be) and such other procedures as may from time to
time be adopted by the Company.
(d) Transfer of a Beneficial Interest in a Global Warrant for a Definitive
Warrant. (i) Upon the transfer of a beneficial interest in a Global Warrant
pursuant to Regulation S, subject to Section 2.04(e)(iii), the interest being
transferred in the Global Warrant may not continue to be held in book-entry form
through the Depositary, will be exchanged for a Definitive Warrant only and will
require the
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delivery by the transferee of a transfer certificate substantially in the form
of the certifications set forth on the reverse of the Warrants.
(ii) Definitive Warrants issued in exchange for a beneficial interest in a
Global Warrant pursuant to this Section 2.04(d) shall be registered in such
names and in such authorized denominations as the Depositary, pursuant to
instructions from its participants or indirect participants or otherwise, shall
instruct the Warrant Agent. The Warrant Agent shall deliver such Warrants to the
persons in whose names such Warrants are so registered in accordance with the
instructions of the Depositary.
(e) Legend. (i) Except as permitted by the following paragraphs (ii) and
(iii), and to the extent permitted by applicable law, each Warrant certificate
evidencing the Global Warrants and Definitive Warrants (and all Warrants and
Warrant Shares issued in exchange therefor or in substitution thereof) shall
bear a legend in substantially the following form:
"THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION
EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), AND THIS SECURITY MAY NOT BE OFFERED, SOLD
OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY
NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION
FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE
144A THEREUNDER. HEDGING TRANSACTIONS INVOLVING THE UNITS OR THE WARRANTS
MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES ACT.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A)
THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY
(I) INSIDE THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY
BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A, (II) OUTSIDE THE UNITED STATES IN A TRANSACTION IN ACCORDANCE WITH
RULE 904 UNDER THE SECURITIES ACT, (III) PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF
AVAILABLE), (IV) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OR (V) TO THE ISSUER, IN EACH OF CASES (I) THROUGH (V) IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES OR ANY OTHER APPLICABLE JURISDICTION, AND (B) THE HOLDER
13
WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF
THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.
THE WARRANT EVIDENCED BY THIS CERTIFICATE AND THE SECURITIES TO BE ISSUED
UPON ITS EXERCISE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT AND THE
WARRANT MAY NOT BE EXERCISED BY OR ON BEHALF OF ANY U.S. PERSON UNLESS
REGISTERED UNDER THE SECURITIES ACT OR AN EXEMPTION FROM SUCH REGISTRATION
IS AVAILABLE."
Each Definitive Warrant will also bear the following legend:
"IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE WARRANT
AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH WARRANT AGENT MAY
REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING
RESTRICTIONS."
Each Warrant Certificate issued prior to the Separation Date will also bear
the following legend (the "Separability Legend"):
"THE WARRANTS EVIDENCED BY THIS CERTIFICATE WERE INITIALLY ISSUED AS PART
OF AN ISSUANCE OF UNITS, EACH OF WHICH CONSISTS OF ONE 13 1/4% SENIOR
SUBORDINATED NOTE DUE 2009 OF INTERSIL CORPORATION WITH A PRINCIPAL AMOUNT
OF $1,000 (A "NOTE") AND ONE WARRANT. THE NOTES AND WARRANTS WILL NOT TRADE
SEPARATELY UNTIL THE EARLIEST OF (I) THE COMMENCEMENT OF A REGISTERED
EXCHANGE OFFER FOR THE NOTES, (II) THE EFFECTIVENESS OF A SHELF
REGISTRATION STATEMENT WITH RESPECT TO THE NOTES AND (III) SUCH EARLIER
DATE AFTER OCTOBER 12, 1999, AS THE INITIAL PURCHASERS MAY DETERMINE."
(ii) Upon any sale or transfer of a Transfer Restricted Security (including
any Transfer Restricted Security represented by a Global Warrant) pursuant to
Rule 144 under the Securities Act:
(A) in the case of any Transfer Restricted Security that is a
Definitive Warrant, the Warrant Agent shall permit the Holder thereof to
exchange such Transfer Restricted Security for a certificated Warrant that
does not bear the legends set forth above (other than the Separability
Legend) and rescind any restriction on the transfer of such Transfer
Restricted Security; and
(B) in the case of any Transfer Restricted Security that is
represented by a Global Warrant, the Warrant Agent shall permit the Holder
thereof to exchange such Transfer Restricted Security for a
14
certificated Warrant that does not bear the legends set forth above (other
than the Separability Legend) and rescind any restriction on the transfer
of such Transfer Restricted Security, if the Holder certifies in writing to
the Warrant Agent that its request for such exchange was made in reliance
on Rule 144 (such certification to be in the form set forth on the reverse
of the Warrant).
(iii) After a transfer of any Warrants during the period of the
effectiveness of a Warrant Shelf Registration Statement with respect to such
Warrants, all requirements pertaining to legends on such Warrant (other than the
Separability Legend) will cease to apply, the requirements requiring any such
Warrant issued to certain Holders to be issued in global form will cease to
apply, and a certificated Warrant without legends (other than the Separability
Legend) will be available to the transferee of the Holder of such Warrants upon
exchange of such transferring Holder's certificated Warrant or directions to
transfer such Holder's interest in the Global Warrant, as applicable.
(iv) On or after the Separation Date, the Holder of a Warrant Certificate
containing a Separability Legend may surrender such Warrant Certificate
accompanied by a written application to the Warrant Agent, duly executed by the
Holder thereof, for a new Warrant Certificate or certificates not containing the
Separability Legend.
(f) Cancelation or Adjustment of Global Warrant. At such time as all
beneficial interests in a Global Warrant have been exchanged for certificated
Warrants, redeemed, repurchased or canceled, such Global Warrant shall be
returned to the Depositary for cancelation or retained and canceled by the
Warrant Agent. At any time prior to such cancelation, if any beneficial interest
in a Global Warrant is exchanged for certificated Warrants, redeemed, repur-
chased or canceled, the number of Warrants represented by such Global Warrant
shall be reduced and an adjustment shall be made on the books and records of the
Warrant Agent (if it is then the Warrant Custodian for such Global Warrant) with
respect to such Global Warrant, by the Warrant Agent, to reflect such reduction.
(g) Obligations with Respect to Transfers and Exchanges of Warrants. (i) To
permit registrations of transfers and exchanges, the Company shall execute and
the Warrant Agent shall countersign certificated Warrants, Definitive Warrants
and Global Warrants as required pursuant to the provisions of Section 2.02 and
this Section 2.04.
(ii) No service charge shall be made to a Holder for any registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any
15
transfer tax, assessments, or similar governmental charge payable in connection
therewith.
(iii) Prior to the due presentation for registration of transfer of any
Warrant, the Company and the Warrant Agent may deem and treat the Person in
whose name a Warrant is registered as the absolute owner of such Warrant, and
neither the Company nor the Warrant Agent shall be affected by notice to the
contrary.
(iv) All Warrants issued upon any transfer or exchange pursuant to the
terms of this Agreement shall be the valid obligations of the Company, entitled
to the same benefits under this Agreement as the Warrants surrendered upon such
transfer or exchange.
(h) No Obligation of the Warrant Agent. (i) The Warrant Agent shall have no
responsibility or obligation to any beneficial owner of a Global Warrant, a
member of, or a participant in the Depositary or other Person with respect to
the accuracy of the records of the Depositary or its nominee or of any
participant or member thereof, with respect to any ownership interest in the
Warrants or with respect to the delivery to any participant, member, beneficial
owner or other Person (other than the Depositary) of any notice or the payment
of any amount, under or with respect to such Warrants. All notices and
communications to be given to the Holders and all payments to be made to Holders
under the Warrants shall be given or made only to or upon the order of the
registered Holders (which shall be the Depositary or its nominee in the case of
a Global Warrant). The rights of beneficial owners in any Global Warrant shall
be exercised only through the Depositary subject to the applicable rules and
procedures of the Depositary. The Warrant Agent may rely and shall be fully
protected in relying upon information furnished by the Depositary with respect
to its members, participants and any beneficial owners.
(ii) The Warrant Agent shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on transfer imposed
under this Agreement or under applicable law with respect to any transfer of any
interest in any Warrant (including any transfers between or among the Depositary
participants, members or beneficial owners in any Global Warrant) other than to
require delivery of such certificates and other documentation or evidence as are
expressly required by, and to do so if and when expressly required by, the terms
of this Agreement, and to examine the same to determine substantial compliance
as to form with the express requirements hereof.
(i) No Registration of Transfer. The Company shall not, and shall cause the
Warrant Agent not to, register any transfer of Warrants or Warrant Shares not
made in
16
accordance with the provisions of Regulation S, pursuant to registration under
the Securities Act or pursuant to an available exemption from registration.
SECTION 2.05. Certificated Warrants. (a) A Global Warrant deposited with
the Depositary or with the Warrant Agent as custodian for the Depositary
pursuant to Section 2.01 shall be transferred to the beneficial owners thereof
in the form of certificated Warrants in a number equal to the number of Warrants
represented by such Global Warrant, in exchange for such Global Warrant, only if
such transfer complies with Section 2.04 and (i) the Depositary notifies the
Company that it is unwilling or unable to continue as depositary for such Global
Warrant or if at any time the Depositary ceases to be a "clearing agency"
registered under the Exchange Act and a successor depositary is not appointed by
the Company within 90 days of such notice or (ii) the Company, in its sole
discretion, notifies the Warrant Agent in writing that it elects to cause the
issuance of Certificated Warrants under this Agreement.
(b) Any Global Warrant that is transferable to the beneficial owners
thereof pursuant to this Section shall be surrendered by the Depositary to the
Warrant Agent, to be so transferred, in whole or from time to time in part,
without charge, and the Warrant Agent shall countersign and deliver, upon such
transfer of each portion of such Global Warrant, an equal number of Certificated
Warrants. Any certificated Warrant delivered in exchange for an interest in the
Global Warrant shall, except as otherwise provided by Section 2.04(g), bear the
restricted securities legend set forth in Section 2.04(e) hereto.
(c) Subject to the provisions of Section 2.05(b), the registered Holder of
a Global Warrant may grant proxies and otherwise authorize any Person, including
Agent Members and Persons that may hold interests through Agent Members, to take
any action which a Holder is entitled to take under this Agreement or the
Warrants.
(d) In the event of the occurrence of either of the events specified in
Section 2.05(a), the Company will promptly make available to the Warrant Agent a
reasonable supply of Certificated Warrants in definitive, fully registered form
Warrants.
SECTION 2.06. Replacement Certificates. If a mutilated Warrant Certificate
is surrendered to the Warrant Agent or if the Holder of a Warrant Certificate
claims that the Warrant Certificate has been lost, destroyed or wrong fully
taken, the Company shall issue and the Warrant Agent shall countersign a
replacement Warrant Certificate if the reasonable requirements of the Warrant
Agent and of Section 8-405 of the Uniform Commercial Code as in effect in the
State of New York are met. If required by the Warrant
17
Agent or the Company, such Holder shall furnish an indemnity bond sufficient in
the judgment of the Company and the Warrant Agent to protect the Company and the
Warrant Agent from any loss which either of them may suffer if a Warrant
Certificate is replaced. The Company and the Warrant Agent may charge the Holder
for their expenses in replacing a Warrant Certificate. Every replacement Warrant
Certificate evidences an additional obligation of the Company.
SECTION 2.07. Outstanding Warrants. Warrants outstanding at any time are
all Warrants evidenced on all Warrant Certificates authenticated by the Warrant
Agent except for those canceled by it and those delivered to it for cancelation.
A Warrant does not cease to be outstanding because an Affiliate of the Company
holds the Warrant. A Warrant ceases to be outstanding if the Company holds the
Warrant.
If a Warrant Certificate is replaced pursuant to Section 2.06, the Warrants
evidenced thereby cease to be outstanding unless the Warrant Agent and the
Company receive proof satisfactory to them that the replaced Warrant Certificate
is held by a bona fide purchaser.
SECTION 2.08. Temporary Certificates. Until definitive Warrant Certificates
are ready for delivery, the Company may prepare and the Warrant Agent shall
countersign temporary Warrant Certificates. Temporary Warrant Certificates shall
be substantially in the form of definitive Warrant Certificates but may have
variations that the Company considers appropriate for temporary Warrant
Certificates. Without unreasonable delay following the occurrence of either of
the events specified in Section 2.05(a), the Company shall prepare and the
Warrant Agent shall countersign definitive Warrant Certificates and deliver them
in exchange for temporary Warrant Certificates.
SECTION 2.09. Cancelation. (a) In the event the Company shall purchase or
otherwise acquire Certificated Warrants, the same shall thereupon be delivered
to the Warrant Agent for cancelation.
(b) The Warrant Agent and no one else shall cancel and destroy all Warrant
Certificates surrendered for transfer, exchange, replacement, exercise or
cancelation and deliver a certificate of such destruction to the Company unless
the Company directs the Warrant Agent to deliver canceled Warrant Certificates
to the Company. The Company may not issue new Warrant Certificates to replace
Warrant Certificates to the extent they evidence Warrants which have been
exercised or Warrants which the Company has purchased or otherwise acquired.
SECTION 2.10. CUSIP Numbers. The Company in issuing the Warrants may use
"CUSIP" numbers (if then
18
generally in use) and, if so, the Warrant Agent shall use "CUSIP" numbers in
notices as a convenience to Holders; provided, however, that any such notice may
state that no representation is made as to the correctness of such numbers
either as printed on the Warrant Certificates or as contained in any notice and
that reliance may be placed only on the other identification numbers printed on
the Warrant Certificates.
ARTICLE III
Exercise Terms
SECTION 3.01. Exercise. Each Warrant shall initially entitle the Holder
thereof, subject to adjustment pursuant to the terms of this Agreement, to
purchase 27.7778 shares of Class A Common Stock. The exercise price (the
"Exercise Price") of each Warrant is $0.001 per share.
SECTION 3.02. Exercise Periods. (a) Subject to the terms and conditions set
forth herein, the Warrants shall be exercisable at any time and from time to
time on any Business Day after the first anniversary of the Issue Date;
provided, however, that holders of Warrants will be able to exercise their
Warrants only if (i) the Common Shelf Registration Statement relating to the
Warrant Shares is effective or (ii) the exercise of such Warrants is exempt from
the registration requirements of the Securities Act, and the Warrant Shares are
qualified for sale or exempt from qualification under the applicable securities
laws of the states or other jurisdictions in which such holders reside.
(b) No Warrant shall be exercisable after August 15, 2009 (the "Expiration
Date").
SECTION 3.03. Expiration. A Warrant shall terminate and become void as of
the earlier of (i) the close of business on the Expiration Date or (ii) the date
such Warrant is exercised. The Company shall give notice not less than 90, and
not more than 120, days prior to the Expiration Date to the Holders of all then
outstanding Warrants to the effect that the Warrants will terminate and become
void as of the close of business on the Expiration Date; provided, however, that
if the Company fails to give notice as provided in this Section 3.03, the
Warrants will nevertheless expire and become void on the Expiration Date.
SECTION 3.04. Manner of Exercise. Warrants may be exercised upon (i)
surrender to the Warrant Agent at the office of the Warrant Agent of the related
Warrant Certificate, together with the form of election attached thereto to
purchase Class A Common Stock on the reverse thereof duly filled in and signed
by the Holder thereof and (ii) payment to the Warrant Agent, for the account of
the
19
Company, of the Exercise Price for each Warrant Share or other security issuable
upon the exercise of such Warrants then exercised. Such payment shall be made
(i) in cash or by certified or official bank check payable to the order of the
Company or by wire transfer of funds to an account designated by the Company for
such purpose or (ii) without the payment of cash, by reducing the number of
shares of Common Stock obtainable upon the exercise of a Warrant and payment of
the Exercise Price in cash so as to yield a number of shares of Common Stock
upon the exercise of such Warrant equal to the product of (a) the number of
shares of Common Stock issuable as of the Exercise Date upon the exercise of
such Warrant (if payment of the Exercise Price were being made in cash) and (b)
the Cashless Exercise Ratio. An exercise of a Warrant in accordance with the
immediately preceding sentence 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 of Common Stock deliverable upon a Cashless Exercise shall be equal to
the number of shares of Common Stock issuable upon the exercise of Warrants that
the holder specifies are to be exercised pursuant to a Cashless Exercise
multiplied by the Cashless Exercise Ratio. All provisions of this Agreement
shall be applicable with respect to a surrender of a Warrant Certificate
pursuant to a Cashless Exercise for less than the full number of Warrants
represented thereby. Subject to Section 3.02, the rights represented by the
Warrants shall be exercisable at the election of the Holders thereof either in
full at any time or from time to time in part and in the event that a Warrant
Certificate is surrendered for exercise of less than all the Warrants
represented by such Warrant Certificate at any time prior to the Expiration
Date, a new Warrant Certificate representing the remaining Warrants shall be
issued. The Warrant Agent shall countersign and deliver the required new Warrant
Certificates, and the Company, at the Warrant Agent's request, shall supply the
Warrant Agent with Warrant Certificates duly signed on behalf of the Company for
such purpose.
SECTION 3.05. Issuance of Warrant Shares. Subject to Section 2.06, upon the
surrender of Warrant Certificates and payment of the per share Exercise Price,
as set forth in Section 3.04, the Company shall issue and cause the Warrant
Agent or, if appointed, a transfer agent for the Common Stock ("Stock Transfer
Agent") to countersign and deliver to or upon the written order of the Holder
and in such name or names as the Holder may designate, a certificate or
certificates for the number of full Warrant Shares so purchased upon the
exercise of such Warrants or other securities or property to which it is
entitled, registered or otherwise, to the Person or Persons entitled to receive
the same (including any depositary institution so designated by a Holder),
together with cash as provided in
20
Section 3.06 in respect of any fractional Warrant Shares otherwise issuable upon
such exercise. 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 Warrant Certificates and payment of the per share Exercise Price, as
aforesaid; provided, however, that if, at such date, the transfer books for the
Warrant Shares shall be closed, the certificates for the Warrant Shares in
respect of which such Warrants are then exercised shall be issuable as of the
date on which such books shall next be opened and until such date the Company
shall be under no duty to deliver any certificates for such Warrant Shares;
provided further, however, that such transfer books, unless otherwise required
by law, shall not be closed at any one time for a period longer than 20 calendar
days.
SECTION 3.06. Fractional Warrant Shares. The Company shall not be required
to issue fractional Warrant Shares on the exercise of Warrants. If more than one
Warrant shall be exercised in full at the same time by the same Holder, the
number of full Warrant Shares which shall be issuable upon such exercise shall
be computed on the basis of the aggregate number of Warrant Shares which may be
purchasable pursuant thereto. If any fraction of a Warrant Share would, except
for the provisions of this Section 3.06, be issuable upon the exercise of any
Warrant (or specified portion thereof), the Company shall pay an amount in cash
equal to the Current Market Value per Warrant Share, as determined on the day
immediately preceding the date the Warrant is presented for exercise, multiplied
by such fraction, computed to the nearest whole cent.
SECTION 3.07. Reservation of Warrant Shares. The Company shall at all times
keep reserved out of its authorized shares of Class A Common Stock a number of
shares of Class A Common Stock sufficient to provide for the exercise of all
outstanding Warrants. The registrar for the Class A Common Stock (the
"Registrar") shall at all times until the Expiration Date 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 Stock Transfer Agent. The Company will
supply such Stock Transfer Agent with duly executed stock certificates for such
purpose and will itself provide or otherwise make available any cash which may
be payable as provided in Section 3.06. The Company will furnish to such Stock
Transfer Agent a copy of all notices of adjustments (and certificates related
thereto) transmitted to each Holder.
Before taking any action which would cause an adjustment pursuant to
Article IV to reduce the Exercise Price below the then par value (if any) of the
Common Stock, the Company shall take any and all corporate action which
21
may, in the opinion of its counsel, be necessary in order that the Company may
validly and legally issue fully paid and nonassessable shares of Class A Common
Stock at the Exercise Price as so adjusted.
The Company covenants that all Warrant Shares which may be issued upon
exercise of Warrants shall, upon issue, be fully paid, nonassessable, free of
preemptive rights, free from all taxes and free from all liens, charges and
security interests with respect to the issue thereof.
SECTION 3.08. Compliance with Law. (a) Notwithstanding anything in this
Agreement to the contrary, in no event shall a Holder be entitled to exercise a
Warrant unless (i) a registration statement filed under the Securities Act in
respect of the issuance of the Warrant Shares is then effective or (ii) in the
opinion of counsel to the Company addressed to the Warrant Agent the exercise of
such Warrants is exempt from the registration requirements of the Securities Act
and such securities are qualified for sale or exempt from qualification under
the applicable securities laws of the states or other jurisdictions in which
such Holders reside.
(b) If any shares of Class A Common Stock required to be reserved for
purposes of the exercise of Warrants require, under any other Federal or state
law or applicable governing rule or regulation of any national securities
exchange, registration with or approval of any governmental authority, or
listing on any such national securities exchange before such shares may be
issued upon exercise, the Company will cause such shares to be duly registered
or approved by such governmental authority or listed on the relevant national
securities exchange, as the case may be.
ARTICLE IV
Antidilution Provisions
SECTION 4.01. Changes in Common Stock. In the event that at any time and
from time to time the Company shall (i) pay a dividend or make a distribution on
the Common Stock in shares of Common Stock or other shares of Capital Stock,
(ii) subdivide its outstanding shares of Common Stock into a larger number of
shares of Common Stock, (iii) combine its outstanding shares of Common Stock
into a smaller number of shares of Common Stock or (iv) increase or decrease the
number of shares of Class A Common Stock outstanding by reclassification of its
Common Stock, then the number of shares of Class A Common Stock issuable upon
exercise of each Warrant immediately after the happening of such event shall be
adjusted so that, after giving effect to such adjustment, the Holder of each
Warrant shall be
22
entitled to receive the number of shares of Class A Common Stock upon exercise
of such Warrant that such Holder would have owned or have been entitled to
receive had such Warrants been exercised immediately prior to the happening of
the events described above (or, in the case of a dividend or distribution of
Common Stock, immediately prior to the record date therefor). An adjustment made
pursuant to this Section 4.01 shall become effective immediately after the
distribution date, retroactive to the record date therefor in the case of a
dividend or distribution in shares of Common Stock or other shares of Capital
Stock, and shall become effective immediately after the effective date in the
case of a subdivision, combination or reclassification.
SECTION 4.02. Cash Dividends and Other Distributions. In the event that at
any time and from time to time the Company shall distribute to all holders of
Common Stock (i) any dividend or other distribution (including any dividend or
distribution made in connection with a consolidation or merger in which the
Company is the continuing corporation) of cash, evidences of its indebtedness,
shares of its Capital Stock or any other properties or securities or (ii) any
options, warrants or other rights to subscribe for or purchase any of the
foregoing (other than, in the case of clause (i) and (ii) above, (A) any
dividend or distribution described in Section 4.01, (B) any rights, options,
warrants or securities described in Section 4.03 or Section 4.04 and (C) any
cash dividends or other cash distributions from current or retained earnings
other than Extraordinary Cash Dividends), then the number of shares of Class A
Common Stock issuable upon the exercise of each Warrant immediately prior to
such record date for any such dividend or distribution shall be increased to a
number determined by multiplying the number of shares of Class A Common Stock
issuable upon the exercise of such Warrant immediately prior to such record date
for any such dividend or distribution by a fraction, the numerator of which
shall be the Current Market Value per share of Class A Common Stock on the
record date for such dividend or distribution, and the denominator of which
shall be such Current Market Value per share of Class A Common Stock less the
sum of (x) the amount of cash, if any, distributed per share of Common Stock and
(y) the then fair value (as determined in good faith by the Board, whose
determination shall be evidenced by a board resolution filed with the Warrant
Agent, a copy of which will be sent to Holders upon request) of the portion, if
any, of the distribution applicable to one share of Class A Common Stock
consisting of evidences of indebtedness, shares of stock, securities, other
property, warrants, options or subscription or purchase rights; and subject to
Section 4.08, the Exercise Price shall be adjusted to a number determined by
dividing the Exercise Price immediately prior to such record date by the above
fraction. Such adjustments shall be made, and shall only become effective,
whenever any dividend or
23
distribution is made; provided, however, that the Company is not required to
make an adjustment pursuant to this Section 4.02 if at the time of such
distribution the Company makes the same distribution to Holders of Warrants as
it makes to holders of Common Stock pro rata based on the number of shares of
Class A Common Stock for which such Warrants are exercisable (whether or not
currently exercisable). No adjustment shall be made pursuant to this Section
4.02 which shall have the effect of decreasing the number of shares of Common
Stock issuable upon exercise of each Warrant or increasing the Exercise Price.
SECTION 4.03. Common Stock Issue. In the event that at any time or from
time to time the Company shall issue shares of Common Stock for a consideration
per share that is less than the Current Market Value per share of Common Stock
as of the issuance date of such shares, the number of shares of Class A Common
Stock issuable upon the exercise of each Warrant immediately after such issuance
date shall be determined by multiplying the number of shares of Class A Common
Stock issuable upon exercise of each Warrant immediately prior to such issuance
date by a fraction, the numerator of which shall be the number of shares of
Common Stock outstanding immediately preceding the issuance of such shares plus
the number of additional shares of Common Stock to be issued in such
transaction, and the denominator of which shall be the number of shares of
Common Stock outstanding immediately preceding the date for the issuance of such
shares plus the total number of shares of Common Stock which the aggregate
consideration expected to be received by the Company upon the issuance of such
shares (as determined in good faith by the Board, whose determination shall be
evidenced by a board resolution filed with the Warrant Agent, a copy of which
will be sent to Holders upon request) would purchase at the Current Market Value
per share of Common Stock as of the date of such issuance; and, subject to
Section 4.08, in the event of any such adjustment, the Exercise Price shall be
adjusted to a number determined by dividing the Exercise Price immediately prior
to such date of issuance by the aforementioned fraction; provided, however, that
no adjustment to the number of Warrant Shares issuable upon the exercise of the
Warrants or to the Exercise Price shall be made as a result of (i) the issuance
of shares of Common Stock in bona fide public offerings that are underwritten or
in which a placement agent is retained by the Company, (ii) the issuance of
shares of Class A Common Stock upon conversion of Class B Common Stock and the
issuance of shares of Class B Common Stock upon conversion of Class A Common
Stock, in each case as provided in the Certificate of Incorporation of the
Company as in effect on the Issue Date, (iii) the issuance of shares of Common
Stock (including the exercise of options) to officers, directors or employees of
the Company, (iv) the issuance of shares of Common Stock in connection with
acquisitions of products and businesses
24
other than to Affiliates of the Company and (v) the issuance of shares of Common
Stock upon the conversion, exchange or exercise of convertible, exchangeable or
exercisable securities of the Company outstanding on the Issue Date. Such
adjustment shall be made, and shall only become effective, whenever such shares
are issued. No adjustment shall be made pursuant to this Section 4.03 which
shall have the effect of decreasing the number of shares of Class A Common Stock
issuable upon exercise of each Warrant or increasing the Exercise Price.
SECTION 4.04. Issuance of Rights or Options. In the event that at any time
or from time to time the Company shall issue to all holders of Common Stock (i)
rights, options or warrants to acquire (provided, however, that no adjustment
shall be made under Section 4.03 or 4.04 upon the exercise of such rights,
options or warrants), or (ii) securities convertible or exchangeable into
(provided, however, that no adjustment shall be made under Section 4.03 or 4.04
upon the conversion or exchange of such securities (other than issuances
specified in (i) or (ii) which are made as the result of anti-dilution
adjustments in such securities)), Common Stock entitling the holders thereof to
subscribe for or purchase shares of Common Stock at a price per share that is
less than the Current Market Value per share of Common Stock in effect
immediately prior to such issuance other than in connection with the adoption of
a shareholder rights plan by the Company, the number of shares of Class A Common
Stock issuable upon the exercise of each Warrant immediately after such issuance
shall be determined by multiplying the number of shares of Class A Common Stock
issuable upon exercise of each Warrant immediately prior to such issuance by a
fraction, the numerator of which shall be the number of shares of Common Stock
outstanding immediately prior to the issuance of such rights, options, warrants
or securities plus the number of additional shares of Common Stock offered for
subscription or purchase or into which such securities are convertible or
exchangeable, and the denominator of which shall be the number of shares of
Common Stock outstanding immediately prior to the issuance of such rights,
options, warrants or securities plus the total number of shares of Common Stock
which the aggregate consideration expected to be received by the Company upon
the exercise, conversion or exchange of such rights, options, warrants or
securities (as determined in good faith by the Board, whose determination shall
be evidenced by a board resolution filed with the Warrant Agent, a copy of which
will be sent to Holders upon request) would purchase at the Current Market Value
per share of Common Stock as of the record date; and, subject to Section 4.08,
in the event of any such adjustment, the Exercise Price shall be adjusted to a
number determined by dividing the Exercise Price immediately prior to such date
of issuance by the aforementioned fraction. Such adjustment shall be made, and
shall only become effective, whenever such rights, options,
25
warrants or securities are issued. No adjustment shall be made pursuant to this
Section 4.04 which shall have the effect of decreasing the number of shares of
Class A Common Stock issuable upon exercise of each Warrant or increasing the
Exercise Price.
SECTION 4.05. Combination; Liquidation. (a) Except as provided in Section
4.05(b), in the event of a Combination, each Holder shall have the right to
receive upon exercise of the Warrants the kind and amount of shares of Capital
Stock or other securities or property which such Holder would have been entitled
to receive upon completion of or as a result of such Combination had such
Warrant been exercised immediately prior to such event or to the relevant record
date for any such entitlement. Unless paragraph (b) is applicable to a
Combination, the Company shall provide that the surviving or acquiring Person
(the "Successor Company") in such Combination will enter into an agreement with
the Warrant Agent confirming the Holders' rights pursuant to this Section
4.05(a) and providing for adjustments, which shall be as nearly equivalent as
may be practicable to the adjustments provided for in this Article IV. The
provisions of this Section 4.05(a) shall similarly apply to successive
Combinations involving any Successor Company.
(b) In the event of (i) a Combination where consideration to the holders of
Class A Common Stock in exchange for their shares is payable solely in cash or
(ii) the dissolution, liquidation or winding-up of the Company, the Holders of
the Warrants shall be entitled to receive, upon surrender of their Warrant
Certificates, such cash distributions on an equal basis with the holders of
Class A Common Stock 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.
In the event of any Combination described in this Section 4.05(b), the
surviving or acquiring Person and, in the event of any dissolution, liquidation
or winding-up of the Company, the Company, shall deposit promptly with the
Warrant Agent the funds, if any, necessary to pay the Holders of the Warrants
the amounts to which they are entitled as described above. After such funds and
the surrendered Warrant Certificates are received, the Warrant Agent shall make
payment to the Holders by delivering a check in such amount as is appropriate
(or, in the case of consideration other than cash, such other consideration as
is appropriate) to such Person or Persons as it may be directed in writing by
the Holders surrendering such Warrants.
SECTION 4.06. Other Events. If any event occurs as to which the foregoing
provisions of this Article IV are
26
not strictly applicable or, if strictly applicable, would not, in the good faith
judgment of the Board, fairly and adequately protect the purchase rights of the
Warrants in accordance with the essential intent and principles of such
provisions, then such Board shall make such adjustments in the application of
such provisions, in accordance with such essential intent and principles, as
shall be reasonably necessary, in the good faith opinion of such Board, to
protect such purchase rights as aforesaid, but in no event shall any such
adjustment have the effect of increasing the Exercise Price or decreasing the
number of shares of Class A Common Stock issuable upon exercise of the Warrants.
SECTION 4.07. Superseding Adjustment. Upon the expiration of any rights,
options, warrants or conversion or exchange privileges which resulted in
adjustments pursuant to this Article IV, if any thereof shall not have been
exercised, the number of Warrant Shares issuable upon the exercise of each
Warrant shall be readjusted pursuant to the applicable section of Article IV as
if (i) the only shares of Common Stock issuable upon exercise of such rights,
options, warrants, conversion or exchange privileges were the shares of Common
Stock, if any, actually issued upon the exercise of such rights, options,
warrants or conversion or exchange privileges and (ii) shares of Common Stock
actually issued, if any, were issuable for the consideration actually received
by the Company upon such exercise plus the aggregate consideration, if any,
actually received by the Company for the issuance, sale or grant of all such
rights, options, warrants or conversion or exchange privileges whether or not
exercised and the Exercise Price shall be readjusted inversely; provided,
however, that no such readjustment (except by reason of an intervening
adjustment under Section 4.01) shall have the effect of decreasing the number of
Warrant Shares issuable upon the exercise of each Warrant or increasing the
Exercise Price by an amount in excess of the amount of the adjustment initially
made in respect of the issuance, sale or grant of such rights, options, warrants
or conversion or exchange privileges.
SECTION 4.08. Minimum Adjustment. The adjustments required by the
preceding sections of this Article IV shall be made whenever and as often as any
specified event requiring an adjustment shall occur, except that no adjustment
of the Exercise Price or the number of shares of Class A Common Stock issuable
upon exercise of the Warrants that would otherwise be required shall be made
unless and until such adjustment either by itself or with other adjustments not
previously made increases or decreases by at least 1% the Exercise Price or the
number of shares of Class A Common Stock issuable upon exercise of the Warrants
immediately prior to the making of such adjustment. Any adjustment representing
a change of less than such minimum amount shall be carried forward and made as
soon as such adjustment, together with other adjustments required by this
27
Article IV and not previously made, would result in a minimum adjustment. For
the purpose of any adjustment, any specified event shall be deemed to have
occurred at the close of business on the date of its occurrence. In computing
adjustments under this Article IV, fractional interests in Common Stock shall be
taken into account to the nearest one-hundredth of a share.
SECTION 4.09. Notice of Adjustment. Whenever the Exercise Price or the
number of shares of Class A Common Stock and other property, if any, issuable
upon exercise of the Warrants is adjusted, as herein provided, the Company shall
deliver to the Warrant Agent a certificate of a firm of independent accountants
selected by the Board (who may be the regular accountants employed by the
Company) setting forth, in reasonable detail, the event requiring the adjustment
and the method by which such adjustment was calculated (including a description
of the basis on which (i) the Board determined the then fair value of any
evidences of indebtedness, other securities or property or warrants, options or
other subscription or purchase rights and (ii) the Current Market Value of the
Common Stock was determined, if either of such determinations were required),
and specifying the Exercise Price and the number of shares of Class A Common
Stock issuable upon exercise of the Warrants after giving effect to such
adjustment. The Company shall promptly cause the Warrant Agent to mail a copy of
such certificate to each Holder in accordance with Section 8.05. The Warrant
Agent shall be entitled to rely on such certificate and shall be under no duty
or responsibility with respect to any such certificate, except to exhibit the
same from time to time, to any Holder desiring an inspection thereof during
reasonable business hours. The Warrant Agent shall not at any time be under any
duty or responsibility to any Holder to determine whether any facts exist which
may require any adjustment of the Exercise Price or the number of shares of
Class A Common Stock or other stock or property issuable on exercise of the
Warrants, or with respect to the nature or extent of any such adjustment when
made, or with respect to the method employed in making such adjustment or the
validity or value of any shares of Common Stock, evidences of indebtedness,
warrants, options, or other securities or property.
SECTION 4.10. Notice of Certain Transactions. In the event that the Company
shall propose to (a) pay any dividend payable in securities of any class to the
holders of its Common Stock or to make any other non-cash dividend or
distribution to the holders of its Common Stock, (b) offer the holders of its
Common Stock rights to subscribe for or to purchase any securities convertible
into shares of Common Stock or shares of stock of any class or any other
securities, rights or options, (c) issue any (i) shares of Common Stock, (ii)
rights, options or warrants entitling the holders thereof to subscribe for
shares of
28
Common Stock or (iii) securities convertible into or exchangeable or exercisable
for Common Stock (in the case of (i), (ii) and (iii), if such issuance or
adjustment would result in an adjustment hereunder), (d) effect any capital
reorganization, reclassification, consolidation or merger, (e) effect the
voluntary or involuntary dissolution, liquidation or winding-up of the Company
or (f) make a tender offer or exchange offer with respect to the Common Stock,
the Company shall within five days after any such action or offer send to the
Warrant Agent a notice and the Warrant Agent shall within five days after
receipt thereof send the Holders a notice (in such form as shall be furnished to
the Warrant Agent by the Company) of such proposed action or offer. Such notice
shall be mailed by the Warrant Agent to the Holders at their addresses as they
appear in the Certificate Register, which shall specify the record date for the
purposes of such dividend, distribution or rights, or the date such issuance or
event is to take place and the date of participation therein by the holders of
Common Stock, if any such date is to be fixed, and shall briefly indicate the
effect, if any, of such action on the Common Stock and on the number and kind of
any other shares of stock and on other property, if any, and the number of
shares of Class A Common Stock and other property, if any, issuable upon
exercise of each Warrant and the Exercise Price after giving effect to any
adjustment pursuant to Article IV which will be required as a result of such
action. Such notice shall be given as promptly as possible and (x) in the case
of any action covered by clause (a) or (b) above, at least 10 days prior to the
record date for determining holders of the Common Stock for purposes of such
action or (y) in the case of any other such action, at least 20 days prior to
the date of the taking of such proposed action or the date of participation
therein by the holders of Common Stock, whichever shall be the earlier.
SECTION 4.11. Adjustment to Warrant Certificate. The form of Warrant
Certificate need not be changed because of any adjustment made pursuant to this
Article IV, and Warrant Certificates issued after such adjustment may state the
same Exercise Price and the same number of shares of Class A Common Stock
issuable upon exercise of the Warrants as are stated in the Warrant Certificates
initially issued pursuant to this Agreement. The Company, however, may at any
time in its sole discretion make any change in the form of Warrant Certificate
that it may deem appropriate to give effect to such adjustments and that does
not affect the substance of the Warrant Certificate, and any Warrant Certificate
thereafter issued or countersigned, whether in exchange or substitution for an
outstanding Warrant Certificate or otherwise, may be in the form as so changed.
29
ARTICLE V
Registration Rights; Indemnification
SECTION 5.01. Effectiveness of Registration Statement. Subject to Section
5.02, the Company shall cause to be filed pursuant to Rule 415 (or any successor
provision) of the Securities Act not later than 90 days after the Issue Date, a
shelf registration statement relating to the offer and sale of the Warrants by
the Holders from time to time in accordance with the methods of distribution
elected by such holders and set forth in such registration statement (the
"Warrant Shelf Registration Statement"), and shall use its best efforts to cause
the Warrant Shelf Registration Statement to be declared effective under the
Securities Act on or before 150 days after the Issue Date and a shelf
registration statement covering the issuance of Warrant Shares to the Holders
upon exercise of the Warrants by the Holders thereof (the "Common Shelf
Registration Statement", and together with the Warrant Shelf Registration
Statement, the "Registration Statements") and shall use its best efforts to
cause the Common Shelf Registration Statement to be declared effective on or
before 365 days after the Issue Date. The Company shall use its best efforts to
cause (a) the Warrant Shelf Registration Statement to remain effective until the
earliest of (i) such time as all Warrants have been sold thereunder, (ii) two
years after its effective date and (iii) until all Warrants can be sold without
restriction under the Securities Act and (b) the Common Shelf Registration
Statement to remain effective until the earlier of (i) such time as all Warrants
have been exercised and (ii) the Expiration Date. In connection with any
Registration Statement, (i) the Company shall furnish to the Warrant Agent,
prior to the filing with the Commission, a copy of any Registration Statement,
and each amendment thereof and each amendment or supplement, if any, to the
prospectus included therein and shall use its reasonable best efforts to reflect
in each such document, when filed with the Commission, such comments as the
Warrant Agent may reasonably propose, (ii) the Company shall furnish to each
Holder, without charge, at least one copy of any Registration Statement and any
post-effective amendment thereto, including financial statements and schedules,
and, if the Holder so requests in writing, all exhibits thereto (including those
incorporated by reference), (iii) the Company shall, for so long as any
Registration Statement is effective, deliver to each Holder, without charge, as
many copies of the prospectus (including each preliminary prospectus) included
in such Registration Statement and any amendment or supplement thereto as such
Holder may reasonably request, and the Company consents to the proper use of the
prospectus therein and any amendment or supplement thereto by each of the
selling Holders in connection with the offering and sale of the Warrants or the
Warrant Shares, as the case may be, covered by such
30
prospectus and any amendment or supplement thereto, (iv) the Company may require
each Holder of Warrants to be sold pursuant to the Warrant Shelf Registration
Statement or to be exercised in connection with the Common Shelf Registration
Statement to furnish to the Company such information regarding the Holder and
the distribution of such Warrants or Warrant Shares as the Company may from time
to time reasonably request for inclusion in such Registration Statement, (v) the
Company shall, if requested, promptly incorporate in a prospectus supplement or
post-effective amendment to such Registration Statement such information as a
majority in interest of the Holders reasonably agree should be included therein
and shall make all required filings of such prospectus supplement or
post-effective amendment as soon as notified of the matters to be incorporated
in such prospectus supplement or post-effective amendment, (vi) the Company
shall enter into such agreements (including underwriting agreements) as are
appropriate, customary and reasonably necessary in connection with any such
Registration Statement and (vii) the Company shall (A) make available all
material customary for reasonable due diligence examinations in connection with
such Registration Statements, (B) make such representations and warranties to
the Holders of Warrants and the underwriters, if any, as are customary and
reasonable in connection with such Registration Statements, (C) obtain such
opinions of counsel to the Company addressed to and reasonably satisfactory to
the Holders as are customary and reasonable in connection with such Registration
Statements and (D) obtain such "comfort" letters and updates thereof from the
independent certified public accountants of the Company addressed to the Holders
as are customary and reasonable in connection with such Registration Statements.
The Company will furnish the Warrant Agent with current prospectuses meeting the
requirements of the Securities Act in sufficient quantity to permit the Warrant
Agent to deliver, at the Company's expense, a prospectus to each holder of a
Warrant upon the exercise thereof. The Company shall promptly inform the Warrant
Agent of any change in the status of the effectiveness or availability of any
Registration Statement.
SECTION 5.02. Suspension. During any consecutive 365-day period, the
Company shall be entitled to suspend the availability of each of the Warrant
Shelf Registration Statement and the Common Shelf Registration Statement for up
to two 45 consecutive-day periods (except for the 45 consecutive-day period
immediately prior to the Expiration Date) if the Company's Board determines in
the exercise of its reasonable judgment that there is a valid business purpose
for such suspension and provides notice that such determination was made to the
Holders of the Warrants; provided, however, that in no event shall the Company
be required to disclose the business purpose for such suspension if the Company
determines in good faith that such business purpose must remain confidential.
31
SECTION 5.03. Blue Sky. The Company shall use its best efforts to register
or qualify the Warrants and the Warrant Shares under all applicable securities
laws, blue sky laws or similar laws of all jurisdictions in the United States
and Canada in which any holder of Warrants may or may be deemed to purchase
Warrants or Warrant Shares upon the exercise of Warrants and shall use its best
efforts to maintain such registration or qualification for so long as it is
required to cause the Warrant Shelf Registration Statement (in the case of the
Warrants) and the Common Shelf Registration Statement (in the case of the
Warrant Shares) to remain effective under the Securities Act pursuant to Section
5.01; provided, however, that the Company shall not be required to qualify
generally to do business in any jurisdiction where it would not otherwise be
required to qualify but for this Section 5.03 or to take any action which would
subject it to general service of process or to taxation in any such jurisdiction
where it is not then so subject.
SECTION 5.04. Accuracy of Disclosure. The Company represents and warrants
to each Holder and agrees for the benefit of each Holder that (i) each of the
Warrant Shelf Registration Statement and the Common Shelf Registration Statement
and any amendment thereto will not contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements contained therein not misleading and (ii) each of the
prospectus furnished to such Holder for delivery in connection with the sale of
Warrants and the prospectus delivered to such Holder upon the exercise of
Warrants and the documents incorporated by reference therein will not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements contained
therein, in light of the circumstances under which they were made, not
misleading; provided, however, that the Company shall have no liability under
clauses (i) or (ii) of this Section 5.04 with respect to any such untrue
statement or omission made in any Registration Statement in reliance upon and in
conformity with information furnished to the Company by or on behalf of the
Holders specifically for inclusion therein.
SECTION 5.05. Indemnification. (a) In connection with any Registration
Statement, the Company agrees to indemnify and hold harmless each Holder of the
Securities, and each person, if any, who controls such Holder within the meaning
of the Securities Act or the Exchange Act (each Holder and such controlling
persons being referred to collectively as the "Indemnified Parties") from and
against any losses, claims, damages or liabilities, joint or several, or any
actions in respect thereof (including, but not limited to, any losses, claims,
damages, liabilities or actions relating to purchases and sales of
32
the Securities) to which each Indemnified Party may become subject under the
Securities Act, the Exchange Act or otherwise, insofar as such losses, claims,
damages, liabilities or actions arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in a
Registration Statement or prospectus or in any amendment or supplement thereto
or in any preliminary prospectus relating to a Registration Statement, or arise
out of, or are based upon, the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, and shall reimburse, as incurred, the Indemnified Parties for any
legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action in
respect thereof; provided, however, that (i) the Company shall not be liable in
any such case to the extent that such loss, claim, damage or liability arises
out of or is based upon any untrue statement or alleged untrue statement or
omission or alleged omission made in a Registration Statement or prospectus or
in any amendment or supplement thereto or in any preliminary prospectus relating
to a Registration Statement in reliance upon and in conformity with written
information pertaining to such Holder and furnished to the Company by or on
behalf of such Holder specifically for inclusion therein and (ii) with respect
to any untrue statement or omission or alleged untrue statement or omission made
in any preliminary prospectus relating to a Registration Statement, the
indemnity agreement contained in this subsection (a) shall not inure to the
benefit of any Holder from whom the person asserting any such losses, claims,
damages or liabilities purchased the Securities concerned, to the extent that a
prospectus relating to such Securities was required to be delivered by such
Holder under the Securities Act in connection with such purchase and any such
loss, claim, damage or liability of such Holder results from the fact that there
was not sent or given to such person, at or prior to the written confirmation of
the sale of such Securities to such person, a copy of the final prospectus if
the Company had previously furnished copies thereof to such Holder; provided
further, however, that this indemnity agreement will be in addition to any
liability which the Company may otherwise have to such Indemnified Party. The
Company shall also indemnify underwriters, selling brokers, dealer-managers and
similar securities industry professionals participating in the distribution (in
each case as described in the Registration Statement), their officers and
directors and each person who controls such persons within the meaning of the
Securities Act or the Exchange Act to the same extent as provided above with
respect to the indemnification of the Holders of the Securities if requested by
such Holders.
33
(b) In connection with any Registration Statement, each Holder of the
Securities, severally and not jointly, will indemnify and hold harmless the
Company and each person, if any, who controls the Company within the meaning of
the Securities Act or the Exchange Act (and the directors, officers, agents and
employees of the Company and any such controlling person) from and against any
losses, claims, damages or liabilities or any actions in respect thereof
(including, but not limited to, any losses, claims, damages, liabilities or
actions relating to purchases and sales of the Securities) to which the Company
or any such controlling person (or the directors, officers, agents and employees
of the Company and any such controlling person) may become subject under the
Securities Act, the Exchange Act or otherwise, insofar as such losses, claims,
damages, liabilities or actions arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in a
Registration Statement or prospectus or in any amendment or supplement thereto
or in any preliminary prospectus relating to a Registration Statement, or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, but in each case only to the extent that the untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with written information pertaining to such Holder and
furnished to the Company by or on behalf of such Holder specifically for
inclusion therein; and, subject to the limitation set forth immediately
preceding this clause, shall reimburse, as incurred, the Company for any legal
or other expenses reasonably incurred by the Company or any such controlling
person (or the directors, officers, agents and employees of the Company and any
such controlling person) in connection with investigating or defending any loss,
claim, damage, liability or action in respect thereof. This indemnity agreement
will be in addition to any liability which such Holder may otherwise have to the
Company or any of its controlling persons.
(c) Promptly after receipt by an indemnified party under this Section 5.05
of notice of the commencement of any action or proceeding (including a
governmental investigation), such indemnified party will, if a claim in respect
thereof is to be made against the indemnifying party under this Section 5.05,
notify the indemnifying party of the commencement thereof; but the failure to so
notify the indemnifying party will not, in any event, relieve the indemnifying
party from any obligations to any indemnified party other than the
indemnification obligation provided in paragraph (a) or (b) above (except to the
extent that it is prejudiced or harmed in any material respect by failure to
give such prompt notice). In case any such action is brought against any
indemnified party, and it notifies the
34
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party (who
shall not, except with the consent of the indemnified party, act as both counsel
to the indemnified and indemnifying parties in such action if, in the reasonable
opinion of both counsel to the indemnified party and the indemnifying party, a
conflict exists which makes such joint representation not advisable), and after
notice from the indemnifying party to such indemnified party of its election to
so assume the defense thereof the indemnifying party will not be liable to such
indemnified party under this Section 5.05 for any legal or other expenses, other
than reasonable costs of investigation, subsequently incurred by such
indemnified party in connection with the defense thereof. No indemnifying party
shall, without the prior written consent of the indemnified party, not to be
unreasonably withheld, effect any settlement of any pending or threatened action
in respect of which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified party unless such
settlement includes an unconditional release of such indemnified party from all
liability on any claims that are the subject matter of such action. No
indemnifying party shall be liable for any amounts paid in settlement of any
action or claim without its written consent, which consent shall not be
unreasonably withheld.
(d) If the indemnification provided for in this Section 5.05 is unavailable
or insufficient to hold harmless an indemnified party under subsections (a) or
(b) above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to in subsection (a) or (b)
above (i) in such proportion as is appropriate to reflect the relative benefits
received by the indemnifying party or parties on the one hand and the
indemnified party on the other from the Registration Statement, or (ii) if the
allocation provided by the foregoing clause (i) is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the
indemnifying party or parties on the one hand and the indemnified party on the
other in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities (or actions in respect thereof) as well
as any other relevant equitable considerations. The relative fault of the
parties shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact
35
relates to information supplied by the Company on the one hand or such Holder or
such other indemnified person, as the case may be, on the other, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The amount paid by an indemnified
party as a result of the losses, claims, damages or liabilities referred to in
the first sentence of this subsection (d) shall be deemed to include any legal
or other expenses reasonably incurred by such indemnified party in connection
with investigating or defending any action or claim which is the subject of this
subsection (d). Notwithstanding any other provision of this Section 5.05(d),
the Holders of the Securities shall not be required to contribute any amount in
excess of the amount by which the net proceeds received by such Holders from the
sale of the Warrants pursuant to the Warrant Shelf Registration Statement or the
Warrant Shares pursuant to the Common Shelf Registration Statement exceeds the
amount of damages which such Holders have otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. For purposes
of this paragraph (d), each person, if any, who controls such indemnified party
within the meaning of the Securities Act or the Exchange Act shall have the same
rights to contribution as such indemnified party and each person, if any, who
controls the Company within the meaning of the Securities Act or the Exchange
Act shall have the same rights to contribution as the Company.
(e) The agreements contained in this Section 5.05 shall survive the sale of
the Securities pursuant to the Registration Statements and shall remain in full
force and effect, regardless of any termination or cancelation of this Agreement
or any investigation made by or on behalf of any indemnified party.
SECTION 5.06. Additional Acts. If the sale of Warrants or the issuance or
sale of any Class A Common Stock or other securities issuable upon the exercise
of the Warrants requires registration or approval of any governmental authority
(other than the registration requirements under the Securities Act), or the
taking of any other action under the laws of the United States or any political
subdivision thereof before such securities may be validly offered or sold in
compliance with such laws, then the Company covenants that it will, in good
faith and as expeditiously as reasonably possible, use its reasonable best
efforts to secure and maintain such registration or approval or to take such
other action, as the case may be. The Company shall promptly notify the Warrant
Agent in writing when (i) the Company has obtained all such governmental
approvals and authorizations and (ii) such
36
approvals and authorizations thereafter cease to be in effect.
SECTION 5.07. Expenses. All expenses incident to the Company's performance
of or compliance with its obligations under this Article V will be borne by the
Company, including without limitation: (i) all SEC, stock exchange or National
Association of Securities Dealers, Inc. registration and filing fees, (ii) all
reasonable fees and expenses incurred in connection with the compliance with
state securities or blue sky laws, (iii) all expenses of any Persons incurred by
or on behalf of the Company in preparing or assisting in preparing, printing and
distributing the Warrant Shelf Registration Statement, the Common Shelf
Registration Statement or any other registration statement, prospectus, any
amendments or supplements thereto and other documents relating to the
performance of and compliance with this Article V, (iv) the fees and
disbursements of the Warrant Agent as agreed, (v) the fees and disbursements of
counsel for the Company and the Warrant Agent as agreed and (vi) the fees and
disbursements of the independent public accountants of the Company, including
the expenses of any special audits or comfort letters required by or incident to
such performance and compliance.
ARTICLE VI
Warrant Agent
SECTION 6.01. Appointment of Warrant Agent. The Company hereby appoints the
Warrant Agent to act as agent for the Company in accordance with the provisions
of this Agreement and the Warrant Agent hereby accepts such appointment.
SECTION 6.02. Rights and Duties of Warrant Agent. (a) Agent for the
Company. In acting under this Warrant 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 or agency or trust for or
with any of the holders of Warrant Certificates or beneficial owners of
Warrants.
(b) Counsel. The Warrant Agent may consult with counsel satisfactory to it
(who may be counsel to the Company), and the advice 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 the
advice of such counsel.
(c) Documents. The Warrant Agent shall be protected and shall incur no
liability for or in respect of any action taken or thing suffered by it in
reliance upon any Warrant Certificate, notice, direction, consent,
37
certificate, affidavit, statement or other paper or document reasonably believed
by it to be genuine and to have been presented or signed by the proper parties.
(d) No Implied Obligations. The Warrant Agent shall be obligated to perform
only such duties as are specifically set forth herein and in the Warrant
Certificates, and no implied duties or obligations of the Warrant Agent shall be
read into this Agreement or the Warrant Certificates against the Warrant Agent.
The Warrant Agent shall not be under any obligation to take any action hereunder
which may tend to involve it in any expense or liability for which it does not
receive indemnity if such indemnity is reasonably requested. The Warrant Agent
shall not be accountable or under any duty or responsibility for the use by the
Company of any of the Warrant Certificates countersigned by the Warrant Agent
and delivered by it to the Holders or on behalf of the Holders pursuant to this
Agreement or for the application by the Company of the proceeds of the Warrants.
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 herein
or in the Warrant Certificates or in the case of the receipt of any written
demand from a Holder with respect to such default, including any duty or
responsibility to initiate or attempt to initiate any proceedings at law or
otherwise.
(e) Not Responsible for Adjustments or Validity of Stock. The Warrant Agent
shall not at any time be under any duty or responsibility to any Holder to
determine whether any facts exist that may require an adjustment of the number
of shares of Common Stock issuable upon exercise of each Warrant or the Exercise
Price, or with respect to the nature or extent of any adjustment when made, or
with respect to the method employed, or herein or in any supplemental agreement
provided to be employed, in making the same. The Warrant Agent shall not be
accountable with respect to the validity or value of any shares of Common Stock
or of any securities or property which may at any time be issued or delivered
upon the exercise of any Warrant or upon any adjustment pursuant to Article IV,
and it makes no representation with respect thereto. The Warrant Agent shall not
be responsible for any failure of the Company to make any cash payment or to
issue, transfer or deliver any shares of Common Stock or stock certificates upon
the surrender of any Warrant Certificate for the purpose of exercise or upon any
adjustment pursuant to Article IV, or to comply with any of the covenants of the
Company contained in Article IV.
SECTION 6.03. Individual Rights of Warrant Agent. The Warrant Agent and any
stockholder, director, officer or employee of the Warrant Agent may buy, sell or
deal in any of the Warrants or other securities of the Company or its
38
affiliates or become pecuniarily interested in transactions in which the Company
or its affiliates may be interested, or contract with or lend money to the
Company or its affiliates or otherwise act as fully and freely as though it were
not the 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.
SECTION 6.04. Warrant Agent's Disclaimer. The Warrant Agent shall not be
responsible for and makes no representation as to the validity or adequacy of
this Agreement or the Warrant Certificates and it shall not be responsible for
any statement in this Agreement or the Warrant Certificates other than its
countersignature thereon.
SECTION 6.05. Compensation and Indemnity. The Company agrees to pay the
Warrant Agent from time to time reasonable compensation for its services as
agreed and to reimburse the Warrant Agent upon request for all reasonable
out-of-pocket expenses incurred by it, including the reasonable compensation and
expenses of the Warrant Agent's agents and counsel as agreed. The Company shall
indemnify the Warrant Agent, its officers, directors, agents and counsel against
any loss, liability or expense (including reasonable agents' and attorneys' fees
and expenses) incurred by it without negligence or bad faith on its part arising
out of or in connection with the acceptance or performance of its duties under
this Agreement. The Warrant Agent shall notify the Company promptly of any claim
for which it may seek indemnity. The Company need not reimburse any expense or
indemnify against any loss or liability incurred by the Warrant Agent through
wilful misconduct, negligence or bad faith. The Company's payment obligations
pursuant to this Section 6.05 shall survive the termination of this Agreement.
To secure the Company's payment obligations under this Agreement, the
Warrant Agent shall have a lien prior to the Holders on all money or property
held or collected by the Warrant Agent.
SECTION 6.06. Successor Warrant Agent. (a) The Company To Provide and
Maintain Warrant Agent. The Company agrees for the benefit of the Holders that
there shall at all times be a Warrant Agent hereunder until all the Warrants
have been exercised or are no longer exercisable.
(b) Resignation and Removal. The Warrant Agent may at any time resign 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 not be less than 60 days after the date on which
such notice is given unless the Company otherwise agrees. The Warrant Agent
hereunder
39
may be removed at any time by the filing with it of an instrument in writing
signed by or on behalf of the Company and specifying such removal and the date
when it shall become effective, which date shall not be less than 60 days after
such notice is given unless the Warrant Agent otherwise agrees. Any removal
under this Section 6.06 shall take effect upon the appointment by the Company as
hereinafter provided of a successor Warrant Agent (which shall be a bank or
trust company authorized under the laws of the jurisdiction of its organization
to exercise corporate trust powers) and the acceptance of such appointment by
such successor Warrant Agent.
(c) The Company To Appoint Successor. In the event that at any time the
Warrant Agent shall resign, or shall be removed, or shall become incapable of
acting, or shall be adjudged a bankrupt or insolvent, or shall commence a
voluntary case under the Federal bankruptcy laws, as now or hereafter
constituted, or under any other applicable U.S. Federal or state bankruptcy,
insolvency or similar law or shall consent to the appointment of or taking
possession by a receiver, custodian, liquidator, assignee, trustee, sequestrator
(or other similar official) of the Warrant Agent or its property or affairs, or
shall make an assignment for the benefit of creditors, or shall admit in writing
its inability to pay its debts generally as they become due, or shall take
corporate action in furtherance of any such action, or a decree or order for
relief by a court having jurisdiction in the premises shall have been entered in
respect of the Warrant Agent in an involuntary case under the Federal bankruptcy
laws, as now or hereafter constituted, or any other applicable Federal or state
bankruptcy, insolvency or similar law, or a decree or order by a court having
jurisdiction in the premises shall have been entered for the appointment of a
receiver, custodian, liquidator, assignee, trustee, sequestrator (or similar
official) of the Warrant Agent or of its property or affairs, or any public
officer shall take charge or control of the Warrant Agent or of its property or
affairs for the purpose of rehabilitation, conservation, winding up or
liquidation, a successor Warrant Agent, qualified as aforesaid, shall be
appointed by the Company by an instrument in writing, filed with the successor
Warrant Agent. Upon the appointment as aforesaid of a successor Warrant Agent
and acceptance by the successor Warrant Agent of such appointment, the Warrant
Agent shall cease to be Warrant Agent hereunder; provided, however, that in the
event of the resignation of the Warrant Agent under this subsection (c), such
resignation shall be effective on the earlier of (i) the date specified in the
Warrant Agent's notice of resignation and (ii) the appointment and acceptance of
a successor Warrant Agent hereunder.
(d) Successor To Expressly Assume Duties. Any successor Warrant Agent
appointed hereunder shall execute,
40
acknowledge and deliver to its predecessor and to the Company an instrument
accepting such appointment hereunder, and thereupon such successor Warrant
Agent, without any further act, deed or conveyance, shall become vested with all
the rights and obligations of such predecessor with like effect as if originally
named as Warrant Agent hereunder, and such predecessor, upon payment of its
charges and disbursements then unpaid, shall thereupon become obligated to
transfer, deliver and pay over, and such successor Warrant Agent shall be
entitled to receive, all monies, securities and other property on deposit with
or held by such predecessor, as Warrant Agent hereunder.
(e) Successor by Merger. Any corporation into which the Warrant Agent
hereunder may be merged or consolidated, or any corporation resulting from any
merger or consolidation to which the Warrant Agent shall be a party, or any
corporation to which the Warrant Agent shall sell or otherwise transfer all or
substantially all of its assets and business; provided, however, that it shall
be qualified as aforesaid, shall be the successor Warrant Agent under this
Agreement without the execution or filing of any paper or any further act on the
part of any of the parties hereto.
ARTICLE VII
Option Agreement
SECTION 7.01. Option Agreement. The Company shall cause Intersil
Corporation to enter into an option agreement (the "Option Agreement") with
Intersil Prism, LLC or any other entity which has the option to purchase assets
of Intersil Corporation as described in the offering circular for the Units
under "The Transactions-Option Agreement". The Option Agreement shall provide
that prior to consummating the transactions contemplated by the Option
Agreement, Intersil Prism LLC or such holder of such option shall have offered
to the Holders of the Warrants and the Warrant Shares the right and opportunity
to participate in the purchase of such assets upon payment of their pro rata
share of the option purchase price (including any extension price) and the
option exercise price.
ARTICLE VIII
Miscellaneous
SECTION 8.01. SEC Reports. The Company shall file with the Warrant Agent
for the benefit of the Holders of Warrants, within 15 days after it files them
with the SEC, copies of its annual and quarterly reports and other information,
documents and other reports (or copies of such portions of any of the foregoing
as the SEC may by rules and
41
regulations prescribe) which the Company is required to file with the SEC
pursuant to Section 13 or 15(d) of the Exchange Act. Notwithstanding that the
Company may not be subject to the reporting requirements of Section 13 or 15(d)
of the Exchange Act, the Company shall file with the SEC (to the extent the SEC
will accept such filings) and provide the Warrant Agent and Holders with such
annual reports and such information, documents and other reports as are
specified in Sections 13 and 15(d) of the Exchange Act and applicable to a U.S.
corporation subject to such Sections, such information, documents and other
reports to be so filed and provided at the times specified for the filing of
such information, documents and reports under such Sections.
SECTION 8.02. Persons Benefitting. Nothing in this Agreement is intended or
shall be construed to confer upon any Person other than the Company, the Warrant
Agent and the Holders any right, remedy or claim under or by reason of this
Agreement or any part hereof.
SECTION 8.03. Rights of Holders. Holders of unexercised Warrants are not
entitled to (i) receive dividends or other distributions, (ii) receive notice of
or vote at any meeting of the stockholders, (iii) consent to any action of the
stockholders, (iv) receive notice of any other proceedings of the Company, (v)
exercise any preemptive right or (vi) exercise any other rights whatsoever as
stockholders of the Company.
SECTION 8.04. Amendment. This Agreement may be amended by the parties
hereto without the consent of any Holder for the purpose of curing any
ambiguity, or of curing, correcting or supplementing any defective provision
contained herein or adding or changing any other provisions with respect to
matters or questions arising under this Agreement as the Company and the Warrant
Agent may deem necessary or desirable (including without limitation any addition
or modification to provide for compliance with the transfer restrictions set
forth herein); provided, however, that such action shall not adversely affect
the rights of any of the Holders. Any amendment or supplement to this Agreement
that has an adverse effect on the interests of the Holders shall require the
written consent of the Holders of a majority of the then outstanding Warrants.
The consent of each Holder affected shall be required for any amendment pursuant
to which the Exercise Price would be increased or the number of Warrant Shares
issuable upon exercise of Warrants would be decreased (other than pursuant to
adjustments provided herein). In determining whether the Holders of the required
number of Warrants have concurred in any direction, waiver or consent, Warrants
owned by the Company or by any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company shall
be disregarded and deemed not to be outstanding, except that, for the purpose of
determining
42
whether the Warrant Agent shall be protected in relying on any such direction,
waiver or consent, only Warrants which the Warrant Agent knows are so owned
shall be so disregarded. Also, subject to the foregoing, only Warrants
outstanding at the time shall be considered in any such determination.
SECTION 8.05. Notices. Any notice or communication shall be in writing and
delivered in Person or mailed by first-class mail addressed as follows:
if to the Company:
Intersil Holding Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: General Counsel
with a copy to:
Dechert Price & ▇▇▇▇▇▇
4000 ▇▇▇▇ Atlantic Tower
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
if to the Warrant Agent:
United States Trust Company of New York
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Corporate Trust Department
with a copy to:
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq.
The Company or the Warrant Agent by notice to the other may designate
additional or different addresses for subsequent notices or communications.
43
Any notice or communication mailed to a Holder shall be mailed to the
Holder at the Holder's address as it appears on the Certificate Register and
shall be sufficiently given if so mailed within the time prescribed.
Failure to mail a notice or communication to a Holder or any defect in it
shall not affect its sufficiency with respect to other Holders. If a notice or
communication is mailed in the manner provided above, it is duly given, whether
or not the addressee receives it.
SECTION 8.06. Governing Law. The laws of the State of New York shall govern
this Agreement and the Warrant Certificates.
SECTION 8.07. Successors. All agreements of the Company in this Agreement
and the Warrant Certificates shall bind its successors. All agreements of the
Warrant Agent in this Agreement shall bind its successors.
SECTION 8.08. Multiple Originals. The parties may sign any number of copies
of this Agreement. Each signed copy shall be an original, but all of them
together represent the same agreement. One signed copy is enough to prove this
Agreement.
SECTION 8.09. Table of Contents. The table of contents and headings of the
Articles and Sections of this Agreement have been inserted for convenience of
reference only, are not intended to be considered a part hereof and shall not
modify or restrict any of the terms or provisions hereof.
SECTION 8.10. Severability. The provisions of this Agreement are severable,
and if any clause or provision shall be held invalid, illegal or unenforceable
in whole or in part in any jurisdiction, then such invalidity or
unenforceability shall affect in that jurisdiction only such clause or
provision, or part thereof, and shall not in any manner affect such clause or
provision in any other jurisdiction or any other clause or provision of this
Agreement in any jurisdiction.
44
IN WITNESS WHEREOF, the parties have caused this Warrant Agreement to be
duly executed as of the date first written above.
INTERSIL HOLDING CORPORATION,
by /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Chief Executive Officer
UNITED STATES TRUST COMPANY OF
NEW YORK, as Warrant Agent,
by /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Senior Vice President
EXHIBIT A
[FORM OF FACE OF WARRANT CERTIFICATE]
[Separability Legend]
THE WARRANTS EVIDENCED BY THIS CERTIFICATE WERE INITIALLY ISSUED AS PART OF
AN ISSUANCE OF UNITS, EACH OF WHICH CONSISTS OF ONE 13 1/4% SENIOR SUBORDINATED
NOTE DUE 2009 OF INTERSIL CORPORATION WITH A PRINCIPAL AMOUNT OF $1,000 (A
"NOTE") AND ONE WARRANT. THE NOTES AND WARRANTS WILL NOT TRADE SEPARATELY UNTIL
THE EARLIEST OF (I) THE COMMENCEMENT OF A REGISTERED EXCHANGE OFFER FOR THE
NOTES, (II) THE EFFECTIVENESS OF A SHELF REGISTRATION STATEMENT WITH RESPECT TO
THE NOTES AND (III) SUCH DATE AFTER OCTOBER 12, 1999, AS THE INITIAL PURCHASERS
MAY DETERMINE.
[Restricted Securities Legend]
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND THIS SECURITY MAY NOT BE OFFERED,
SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY
NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM
THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A
THEREUNDER. HEDGING TRANSACTIONS INVOLVING THE UNITS OR THE WARRANTS MAY NOT BE
CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES ACT.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A)
THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (I)
INSIDE THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (II) OUTSIDE THE
UNITED STATES IN A TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES
ACT, (III) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (IV) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH
(IV) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION, AND (B) THE HOLDER WILL, AND
EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS SECURITY
FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE. THE WARRANT
EVIDENCED BY THIS CERTIFICATE AND THE SECURITIES TO BE ISSUED UPON ITS EXERCISE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT AND THE WARRANT MAY NOT BE
EXERCISED BY OR ON BEHALF OF ANY U.S. PERSON UNLESS REGISTERED UNDER THE
SECURITIES ACT OR AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.
[Definitive Warrants Legend]
[IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE WARRANT
AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH WARRANT AGENT MAY
REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING
RESTRICTIONS.](1)
[Global Securities Legend]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("THE DEPOSITARY"), NEW
YORK, NEW YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
-----------
(1) To be included only if the Warrant is in definitive form.
2
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT IS
MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITARY) 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.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO NOMINEES OF THE DEPOSITARY OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
WARRANT AGREEMENT REFERRED TO ON THE REVERSE HEREOF.](2)
--------
(2) To be included only if the Warrant is in global form.
3
No. [ ] Certificate for [ ] Warrants
WARRANTS TO PURCHASE COMMON STOCK OF
INTERSIL HOLDING CORPORATION
THIS CERTIFIES THAT [ ], or its registered assigns,
is the registered holder of the number of Warrants set forth above (the
"Warrants"). Each Warrant entitles the holder thereof (the "Holder"), at its
option and subject to the provisions contained herein and in the Warrant
Agreement referred to below, to purchase from INTERSIL HOLDING CORPORATION, a
Delaware corporation ("the Company"), 27.7778 shares of Class A Common Stock,
par value of $0.01 per share, of the Company (the "Common Stock") at the per
share exercise price of $0.001 (the "Exercise Price"), or by Cashless Exercise
referred to below. This Warrant Certificate shall terminate and become void as
of the close of business on August 15, 2009 (the "Expiration Date") or upon the
exercise hereof as to all the shares of Common Stock subject hereto. The number
of shares issuable upon exercise of the Warrants and the Exercise Price per
share shall be subject to adjustment from time to time as set forth in the
Warrant Agreement.
This Warrant Certificate is issued under and in accordance with a Warrant
Agreement dated as of August 13, 1999 (the "Warrant Agreement"), between the
Company and United States Trust Company of New York (the "Warrant Agent", which
term includes any successor Warrant Agent under the Warrant Agreement), and is
subject to the terms and provisions contained in the Warrant Agreement, to all
of which terms and provisions the Holder of this Warrant Certificate consents by
acceptance hereof. The Warrant Agreement is hereby incorporated herein by
reference and made a part hereof. Reference is hereby made to the Warrant
Agreement for a full statement of the respective rights, limitations of rights,
duties and obligations of the Company, the Warrant Agent and the Holders of the
Warrants. Capitalized terms used but not defined herein shall have the meanings
ascribed thereto in the Warrant Agreement. A copy of the Warrant Agreement may
be obtained for inspection by the Holder hereof upon written request to the
Warrant Agent at [ Address ], Attention: Corporate Trust Department.
Subject to the terms of the Warrant Agreement, the Warrants may be
exercised in whole or in part (i) by presentation of this Warrant Certificate
with the Election to Purchase attached hereto duly executed and with the
simultaneous payment of the Exercise Price in cash (subject to adjustment) to
the Warrant Agent for the account of the Company at the office of the Warrant
Agent or (ii) by Cashless Exercise. Payment of the Exercise Price in cash shall
be made by certified or official bank check payable to the order of the Company
or by wire transfer of funds to an account designated by the Company for such
purpose. Payment by Cashless Exercise shall be made without the payment of cash
by reducing the amount of Class A Common Stock that would be obtainable upon the
exercise of a Warrant and payment of the Exercise Price in cash so as to yield a
number of shares of Common Stock upon the exercise of such Warrant equal to the
product of (1) the number of shares of Class A Common Stock for which such
Warrant is exercisable as of the Exercise Date (if the Exercise Price were being
paid in cash) and (2) a fraction, the numerator of which is the excess of the
Current Market Value per share of Class A Common Stock on the Exercise Date over
the Exercise Price per share as of the Exercise Date and the denominator of
which is the Current Market Value per share of the Class A Common Stock on the
Exercise Date.
As provided in the Warrant Agreement and subject to the terms and
conditions therein set forth, the Warrants shall be exercisable at any time and
from time to time on any Business Day after the first anniversary of the Issue
Date; provided, however, that Holders
4
of Warrants will be able to exercise their Warrants only if the Common Shelf
Registration Statement relating to the Class A Common Stock underlying the
Warrants is effective or the exercise of such Warrants is exempt from the
registration requirements of the Securities Act of 1933 and such securities are
qualified for sale or exempt from qualification under the applicable securities
laws of the states or other jurisdictions in which such Holders reside; provided
further, however, that no Warrant shall be exercisable after August 15, 2009.
In the event of a Combination, the Holder hereof will be entitled to
receive upon exercise of the Warrants the kind and amount of shares of capital
stock or other securities or other property as the Holder would have received
had the Holder exercised its Warrants immediately prior to such Combination;
provided, however, that in the event that, in connection with such Combination,
consideration to holders of Class A Common Stock in exchange for their shares is
payable solely in cash or in the event of the dissolution, liquidation or
winding-up of the Company, the Holder hereof will be entitled to receive such
cash distributions on an equal basis with the holders of Common Stock or other
securities issuable upon exercise of the Warrants, as if the Warrants had been
exercised immediately prior to such Combination, less the Exercise Price.
As provided in the Warrant Agreement, the number of shares of Class A
Common Stock issuable upon the exercise of the Warrants and the Exercise Price
are subject to adjustment upon the happening of certain events.
The Company may require payment of a sum sufficient to pay all taxes,
assessments or other governmental charges in connection with the transfer or
exchange of the Warrant Certificates pursuant to Section 2.04 of the Warrant
Agreement, but not for any exchange or original issuance (not involving a
transfer) with respect to temporary Warrant Certificates, the exercise of the
Warrants or the Warrant Shares.
Upon any partial exercise of the Warrants, there shall be countersigned and
issued to the Holder hereof a new Warrant Certificate representing those
Warrants which were not exercised. This Warrant Certificate may be exchanged at
the office of the Warrant Agent by presenting this Warrant Certificate properly
endorsed with a request to exchange this Warrant Certificate for other Warrant
Certificates evidencing an equal number of Warrants. No fractional Warrant
Shares will be issued upon the exercise of the Warrants, but the Company shall
pay an amount in cash equal to the Current Market Value per Warrant Share on the
day immediately preceding the date the Warrant is exercised, multiplied by the
fraction of a Warrant Share that would be issuable on the exercise of any
Warrant.
All shares of Common Stock issuable by the Company upon the exercise of the
Warrants shall, upon such issue, be duly and validly issued and fully paid and
non-assessable.
The holder in whose name the Warrant Certificate is registered may be
deemed and treated by the Company and the Warrant Agent as the absolute owner of
the Warrant Certificate for all purposes whatsoever and neither the Company nor
the Warrant Agent shall be affected by notice to the contrary.
5
The Warrants do not entitle any Holder hereof to any of the rights of a
stockholder of the Company.
This Warrant Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Warrant Agent.
INTERSIL HOLDING CORPORATION,
by
--------------------------------
Name:
Title:
by
--------------------------------
Name:
Title:
DATED:
Countersigned:
UNITED STATES TRUST COMPANY OF NEW YORK,
as Warrant Agent,
by
----------------------------
Authorized Signatory
6
FORM OF ELECTION TO PURCHASE WARRANT SHARES
(to be executed only upon exercise of Warrants)
INTERSIL HOLDING CORPORATION
The undersigned hereby irrevocably elects to exercise __________________
Warrants to acquire shares of Class A Common Stock, par value $0.01 per share,
of INTERSIL HOLDING CORPORATION, at an exercise price per share of Common Stock
of $0.001, and otherwise on the terms and conditions specified in the within
Warrant Certificate and the Warrant Agreement therein referred to, surrenders
this Warrant Certificate and all right, title and interest therein to INTERSIL
HOLDING CORPORATION and directs that the shares of Class A Common Stock
deliverable upon the exercise of such Warrants be registered or placed in the
name and at the address specified below and delivered thereto.
Date:
--------------------, -------
----------------------------(3)
(Signature of Owner)
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(Street Address)
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(City) (State) (Zip Code)
Signature Guaranteed by:
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-----------
(3) The signature must correspond with the name as written upon the face of the
within Warrant Certificate in every particular, without alteration or
enlargement or any change whatever, and must be guaranteed by a national bank or
trust company or by a member firm of any national securities exchange.
7
Securities and/or check to be issued to:
Please insert social security or identifying number:
Name:
Street Address:
City, State and Zip Code:
A new Warrant Certificate evidencing any unexercised Warrants evidenced by the
within Warrant Certificate is to be issued to:
Please insert social security or identifying number:
Name:
Street Address:
City, State and Zip Code:
8
In connection with any transfer of any of the Warrants evidenced by this
certificate occurring prior to the expiration of the period referred to in Rule
144(k) under the Securities Act after the later of the date of original issuance
of such Warrants and the last date, if any, on which such Warrants were owned by
the Company or any Affiliate of the Company, the undersigned certifies that such
Warrants are being transferred in accordance with its terms:
CHECK ONE BOX BELOW
(1) / / to the Company; or
(2) / / pursuant to an effective registration statement under
the Securities Act of 1933; or
(3) / / outside the United States in an offshore transaction
within the meaning of Regulation S under the Securities
Act in compliance with Rule 904 under the Securities
Act of 1933; or
(4) / / pursuant to Rule 144A under the Securities Act of 1933;
or
(5) / / pursuant to another available exemption from
registration provided by Rule 144 under the Securities
Act of 1933.
If such transfer is being made pursuant to an offshore transaction in
accordance with Rule 904 under the Securities Act, the undersigned further
certifies that:
(i) the offer of the Warrants was not made to a person in the United
States;
(ii) 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
offshore 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;
(iii) no directed selling efforts have been made in the United States in
contravention of the requirements of Rule 903 or Rule 904 of Regulation S, as
applicable;
(iv) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act;
(v) we have advised the transferee of the transfer restrictions applicable
to the Warrants;
(vi) if the circumstances set forth in Rule 904(b)(1) under the Securities
Act are applicable, either (a) neither we nor any person acting on our behalf
knows that the transferee is a U.S. person or (b) 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 distribution compliance period specified in Rule 903 of Regulation
S only in accordance with Regulation S; pursuant to registration of the
Warrants under the Securities Act; or pursuant to an available exemption from
the registration requirements under the Securities Act; and
9
(vii) we have advised the transferee that hedging transactions involving
the Units or the Warrants may not be conducted unless in compliance with the
Securities Act.
Unless one of the boxes is checked, the Warrant Agent will refuse to
register any of the Warrants evidenced by this certificate in the name of any
person other than the registered holder thereof; provided, however, that if box
(3) or (4) is checked, the Warrant Agent may require, prior to registering any
such transfer of the Warrants, such legal opinions, additional certifications
and other information as the Company has reasonably requested to confirm that
such transfer is being made pursuant to an exemption from, or in a transaction
not subject to, the registration requirements of the Securities Act of 1933,
such as the exemption provided by Rule 144 under such Act.
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Signature
Signature Guarantee:
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Signature must be guaranteed Signature
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10
SCHEDULE OF EXCHANGES OF CERTIFICATED WARRANTS(4)
The following exchanges of a part of this Global Warrant Certificate for
definitive Warrants have been made:
Number of
Amount of change Warrants in
in Number of this Global
Warrants in Warrant Signature of
this Global Certificate authorized
Date of Warrant following officer of
Exchange Certificate such change Warrant Agent
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(4) To be included only if the Warrant is in global form.