Exhibit 2.2
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FORM OF WARRANT AGREEMENT
Dated as of ______________, 2000
between
PATHMARK STORES, INC.
and
[▇▇▇▇▇ ▇▇▇▇▇▇]
as Warrant Agent
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WARRANT AGREEMENT
TABLE OF CONTENTS
Page
SECTION 1. Defined Terms...................................................................................1
1.1 Certain Definitions......................................................................1
1.2 Rules of Construction....................................................................4
SECTION 2. Issuance, Form, Execution, Delivery and Registration of Warrant Certificates....................5
2.1 Issuance of Warrants.....................................................................5
2.2 Execution of Warrant Certificates........................................................5
2.3 Countersignature and Delivery............................................................5
2.4 Form of Warrant Certificates.............................................................6
2.5 Restrictive Legends......................................................................6
2.6 Temporary Warrant Certificates...........................................................8
2.7 Registration, Registration of Transfers and Exchanges....................................8
2.8 Book-Entry Provisions for Global Warrants................................................9
(a) 9
2.9 Special Transfer Provisions.............................................................11
2.10 Offices for Exercise, Etc...............................................................12
2.11 Cancellation............................................................................13
2.12 Lost, Stolen, Destroyed, Defaced or Mutilated Warrant Certificates......................13
SECTION 3. Terms of Warrants; Exercise of Warrants........................................................14
3.1 Exercise Period.........................................................................14
3.2 Manner of Exercise......................................................................14
3.3 Issuance of Warrant Shares..............................................................15
3.4 Fractional Warrant Shares...............................................................15
3.5 Sufficient Authorized Share Capital.....................................................15
3.6 Payment of Taxes........................................................................16
SECTION 4. Adjustment of Exercise Price and Number of Warrant Shares Issuable.............................16
4.1 Adjustments.............................................................................16
4.2 Tender Offers: Exchange Offers.........................................................19
4.3 Other Events............................................................................19
4.4 When No Adjustment Required.............................................................19
4.5 Superseding Adjustment..................................................................20
4.6 Minimum Adjustment......................................................................21
4.7 Notice of Adjustment....................................................................21
4.8 Notice of Certain Transactions..........................................................21
4.9 Adjustment to Warrant Certificate.......................................................22
4.10 Challenge to Good Faith Determination...................................................22
4.11 Treasury Stock..........................................................................22
SECTION 5. Warrant Agent..................................................................................23
5.1 Appointment of Warrant Agent............................................................23
5.2 Rights and Duties of Warrant Agent......................................................23
5.3 Individual Rights of Warrant Agent......................................................24
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Page
5.4 Warrant Agent's Disclaimer..............................................................25
5.5 Compensation and Indemnity..............................................................25
5.6 Successor Warrant Agent.................................................................26
SECTION 6. Miscellaneous..................................................................................27
6.1 Reports.................................................................................27
6.2 Notices to the Company and Warrant Agent................................................27
6.3 Supplements and Amendments..............................................................28
6.4 Severability............................................................................29
6.5 Successors..............................................................................29
6.6 Termination.............................................................................29
6.7 Governing Law...........................................................................29
6.8 Submission to Jurisdiction; Appointment of Agent for Service; Waiver....................29
6.9 Benefits of This Agreement..............................................................30
6.10 Counterparts............................................................................30
6.11 Table of Contents.......................................................................30
Exhibits
EXHIBIT A - Form of Face of Global Warrant Certificate
EXHIBIT B - Form of Face of Definitive Warrant Certificate
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WARRANT AGREEMENT dated as of ____________, 2000 (the
"Agreement") between Pathmark Stores, Inc., a company organized under the laws
of Delaware (the "Company"), and [▇▇▇▇▇ ▇▇▇▇▇▇], as warrant agent (in such
capacity, the "Warrant Agent").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, under the Disclosure Statement, the Company agreed to
enter into this Agreement with the Warrant Agent to issue the Warrants which
will entitle the holders thereof to purchase 5,294,118 shares of Common Stock at
an Exercise Price of $22.31 based on a reorganization value of the Company of
$1.3 billion; and
WHEREAS, the Company desires the Warrant Agent to assist the
Company in connection with the issuance, exchange, cancellation, replacement and
exercise of the Warrants, and in this Agreement wishes to set forth, among other
things, the terms and conditions on which the Warrants may be issued, exchanged,
cancelled, replaced and exercised; and
WHEREAS, the Company desires the Warrant Agent to act on
behalf of the Company, and the Warrant Agent is willing so to act, in connection
with the issuance of Warrant Certificates (as defined below) and other matters
as provided herein;
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein set forth, and for the purpose of defining the
respective rights and obligations of the Company, the Warrant Agent and the
Holders (as defined below), the parties hereto agree as follows:
SECTION 1. Defined Terms.
1.1 Certain Definitions. As used in this Agreement, the
following terms shall have the following respective meanings:
"Affiliate" means, as applied to any Person, any other Person
directly or indirectly controlling, controlled by, or under direct or
indirect common control with such Person. For purposes of this
definition, "control" (including, with correlative meanings, the terms
"controlling," "controlled by" and "under common control with"), as
applied to any Person, is defined to mean the possession, directly or
indirectly, of the power to direct or cause the direction of the
management and policies of such Person, whether through the ownership
of voting securities by contract or otherwise.
"Agreement" shall have the meaning set forth in the preamble
of this Agreement.
"Amended Certificate of Incorporation" shall mean the amended
and restated Certificate of Incorporation of the Company, as amended
under the Plan of Reorganization.
"Bankruptcy Law" means ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Code (the
"Bankruptcy Code") or any similar United States Federal, state or
foreign law for the relief of creditors.
"Board" means the Board of Supervisory Directors of the
Company.
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"Business Day" means a day other than a Saturday, Sunday or
other day on which commercial banks in New York City are authorized or
required by law to close.
"Cashless Exercise" has the meaning specified in Section 3.2
hereof.
"Cashless Exercise Ratio" means a fraction, the numerator of
which is the excess of the Current Market Value (as defined below) per
share of 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 Common Stock on the Exercise Date.
"Combination" has the meaning specified in Section 4.1(d)
hereof.
"Commission" means the Securities and Exchange Commission.
"Common Stock" shall mean the new common stock of the Company,
par value $0.01 per share as issued under the Amended Certificate of
Incorporation.
"Current Market Value," per share of Common Stock or any other
security at any date, means (i) if the security is not registered under
the Exchange Act, the fair market value of the security (without any
discount for lack of liquidity, the amount of such security offered to
be purchased or the fact that such securities may represent a minority
interest in a private company or a company under the control of another
Person) as determined in good faith by the Board and certified in a
board resolution that is delivered to the Warrant Agent, and determined
to be fair, from a financial point of view, to the holders of such
security or another security exercisable for such security, by an
Independent Financial Expert (as set forth in such Independent
Financial Expert's written fairness opinion); or (ii) if the security
is registered under the Exchange Act, the average of the last reported
sale price of the security (or the equivalent in an over-the-counter
market) for each Business Day (as defined herein) 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, 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 10 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). The Company
shall pay the fees and expenses of any Independent Financial Expert in
the determination of Current Market Value.
"Definitive Warrants" means Warrants in definitive registered
form substantially in the form of Exhibit B.
"DTC" or "Depositary" means The Depository Trust Company or
its successors.
"DWAC" means the Depositary/Deposit Withdraw at Custodian
system.
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"Exchange Act" means the Securities Exchange Act of 1934, as
amended (or any successor act), and the rules and regulations
promulgated thereunder.
"Exercise Date" means the date on which a Warrant is exercised
by the Holder thereof.
"Exercisability Date" means the [___th day after] the Issue
Date.
"Exercise Price" means the purchase price per Warrant Share to
be paid upon the exercise of each Warrant, which price shall be $22.31
per Warrant Share as adjusted in accordance with the terms hereof.
"Expiration Date" means [September 6, 2010].
"Holder" means the registered holder of a Warrant.
"Independent Financial Expert" means an internationally
recognized investment bank that does not (and whose directors,
executive officers and 5% stockholders do not) have a direct or
indirect financial interest in the Company or any of its subsidiaries
or Affiliates, which has not been for at least five years, and at the
time it is called upon to give independent financial advice to the
Company is not (and none of its directors, executive officers or 5%
stockholders is), a promoter, director, or officer of the Company or
any of its subsidiaries or Affiliates. The Independent Financial Expert
may be compensated and indemnified by the company for opinions or
services it provides as an Independent Financial Expert.
"Issue Date" means [September 6], 2000, the date on which the
Warrants are first issued.
"Majority Holders" means the Holders of a majority of the then
outstanding Warrants.
"Nasdaq National Market" means the Nasdaq Stock Market
National Market.
"Officer" means the principal executive officer, the principal
financial officer, the treasurer or the principal accounting officer of
the Company.
"Officers' Certificate" means a certificate signed on behalf
of the Company by two officers of the Company, one of whom must be the
principal executive officer, the principal financial officer, the
treasurer or the principal accounting officer of the Company.
"Person" means any individual, corporation, partnership, joint
venture, limited liability company, association, joint-stock company,
trust, unincorporated organization, government or any agency or
political subdivision thereof or any other entity.
"Plan of Reorganization" means the Joint Plan of
Reorganization of the Company and certain of its Affiliates under
chapter 11 of the Bankruptcy Code.
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"Qualified Institutional Buyer" or "QIB" shall have the
meaning specified in Rule 144A under the Securities Act.
"Repurchase Price" means, in respect of a Warrant, (i) the
excess of the Current Market Value of a share of Common Stock of the
Company over the Exercise Price per share of Common Stock, multiplied
by (ii) the number of Warrant Shares that would be obtained if one
Warrant was exercised on the date of repurchase.
"Resale Restriction Termination Date" has the meaning
specified in Section 2.5 hereof.
"Restricted Period" has the meaning specified in Section 2.4
hereof.
"Right" has the meaning specified in Section 4.1(g) hereof.
"Securities Act" means the Securities Act of 1933, as amended.
"shares of Common Stock" has the meaning specified in the
Preamble hereto.
"Successor Company" has the meaning specified in Section
4.1(d) hereof.
"Warrant Agent" means [▇▇▇▇▇ ▇▇▇▇▇▇], or the successor or
successors of such Warrant Agent appointed in accordance with the terms
hereof.
"Warrant Certificates" means the certificates evidencing the
Warrants to be delivered pursuant to this Agreement, substantially in
the form of Exhibits A and B hereto.
"Warrant Registrar" has the meaning specified in Section 2.8
hereof.
"Warrant Shares" has the meaning specified in Section 2.1
hereof.
"Warrants" shall mean the new warrants issued hereunder and
all warrants issued upon transfer, division or combination of, or in
substitution for, any thereof. All Warrants shall at all times be
identical as to terms and conditions and date, except as to the number
of shares of Common Stock for which they may be exercised.
1.2 Rules of Construction. Unless the text otherwise required:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with United States generally accepted
accounting principles ("U.S. GAAP") as in effect from time to time.
(iii) "or" is not exclusive;
(iv) "including" means including, without limitation; and
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(v) words in the singular include the plural and words in the
plural include the singular.
SECTION 2. Issuance, Form, Execution, Delivery and
Registration of Warrant Certificates.
2.1 Issuance of Warrants. (a) On the Issue Date, the Company
shall issue Warrants to the holders of the 11.625% Subordinated Notes due 2002
of the Company (the "Subordinated Notes"), the 12.625% Subordinated Debentures
due 2002 of the Company (the "Subordinated Debentures") and the 10.75% Junior
Subordinated Referred Coupon Notes due 2003 of the Company (the "Junior
Subordinated Notes") entitling holders of such existing bonds of the Company to
purchase an aggregate of 5,294,118 shares or 15% of the Common Stock of the
Company or such other amount of shares of Common Stock, as adjusted in
accordance with Section 4 of this Agreement.
(b) Each one dollar worth of the Subordinated Notes and the
Subordinated Debentures will entitle its holder to receive 0.01265 Warrants and
each dollar worth of Junior Subordinated Notes will entitle its holder to
receive 0.005487 Warrants. Any Holder of a fraction of a Warrant will be
entitled to receive an additional Warrant if such fraction is higher than 0.5.
Each Warrant issued under this Agreement shall be evidenced by a Warrant
Certificate.
(c) Each Warrant Certificate shall evidence the number of
Warrants specified therein, and each Warrant evidenced thereby shall represent
the right, subject to the provisions contained herein and therein, to purchase
from the Company (and the Company shall issue and sell to such holder of the
Warrant) one share of Common Stock of the Company (the shares purchasable upon
exercise of a Warrant being hereinafter referred to as the "Warrant Shares,"
subject to adjustment as provided in Section 4 hereof).
2.2 Execution of Warrant Certificates. The Warrant
Certificates shall be executed on behalf of the Company by two Officers of the
Company. Such signatures may be the manual or facsimile signatures of the
present or any future such officers. Typographical and other minor errors or
defects in any such reproduction of any such signature shall not affect the
validity or enforceability of any Warrant Certificate that has been duly
countersigned and delivered by the Warrant Agent.
In case any officer of the Company who shall have signed any
of the Warrant Certificates shall cease to be such officer before the Warrant
Certificate so signed shall be countersigned and delivered by the Warrant Agent
or disposed of by the Company, such Warrant Certificate nevertheless may be
countersigned and delivered or disposed of as though the Person who signed such
Warrant Certificate had not ceased to be such officer of the Company; and any
Warrant Certificate may be signed on behalf of the Company by such Persons as,
at the actual date of the execution of such Warrant Certificate, shall be the
proper officers of the Company, although at the date of the execution and
delivery of this Agreement any such Person was not such an officer.
2.3 Countersignature and Delivery. Subject to the immediately
following paragraph, Warrant Certificates shall be countersigned by manual
signature and dated the date of
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countersignature by the Warrant Agent and shall not be valid for any purpose
unless so countersigned and dated. The Warrant Certificates shall be numbered
and shall be registered in the Warrant Register.
Upon the receipt by the Warrant Agent of a written order of
the Company set forth in an Officers' Certificate, specifying the amount of
Warrants to be countersigned, the date of such Warrants and such other
information as the Warrant Agent may reasonably request, the Warrant Agent is
authorized, to countersign the Warrant Certificates upon receipt from the
Company at any time and from time to time of the Warrant Certificates, duly
executed as provided in Section 2.2 hereof, and deliver them, without any
further action by the Company. Such countersignature shall be by a duly
authorized signatory of the Warrant Agent (although it shall not be necessary
for the same signatory to sign all Warrant Certificates).
In case any authorized signatory of the Warrant Agent who
shall have countersigned any of the Warrant Certificates shall cease to be such
authorized signatory before the Warrant Certificate shall be disposed of by the
Company, such Warrant Certificate nevertheless may be delivered or disposed of
as though the Person who countersigned such Warrant Certificate had not ceased
to be such authorized signatory of the Warrant Agent; and any Warrant
Certificate may be countersigned on behalf of the Warrant Agent by such Persons
as, at the actual time of countersignature of such Warrant Certificates, shall
be the duly authorized signatories of the Warrant Agent, although at the time of
the execution and delivery of this Agreement any such Person is not such an
authorized signatory.
The Warrant Agent's countersignature on all Warrant
Certificates shall be in substantially the form set forth in Exhibits A and B
hereto.
2.4 Form of Warrant Certificates. The Warrant Certificates
evidencing the Global Warrants to be delivered pursuant to this Agreement shall
be substantially in the form set forth in Exhibit A attached hereto. Such Global
Warrants shall represent such of the outstanding Warrants as shall be specified
therein and each shall provide that it shall represent the aggregate amount of
outstanding Warrants from time to time endorsed thereon and that the aggregate
amount of outstanding Warrants represented thereby may from time to time be
decreased or increased, as appropriate. Any endorsement of a Global Warrant to
reflect the amount of any increase or decrease in the amount of outstanding
Warrants represented thereby shall be made by the Warrant Agent and DTC in
accordance with instructions given by the holder thereof. The Depository Trust
Company shall act as the Depository (the "Depository") with respect to the
Global Warrants until a successor, if any, shall be appointed by the Company.
Except as provided in Section 2.8(b), owners of beneficial interests in a Global
Warrant will not be entitled to receive physical delivery of Definitive
Warrants.
2.5 Restrictive Legends. Global Warrants shall bear the
following legend (the "Private Placement Legend") on the face thereof:
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE OR
OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
7
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS THE TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS SECURITY BY
ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL
BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS NOT A
U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN "OFFSHORE TRANSACTION" PURSUANT
TO RULE 904 OF REGULATION S, (2) AGREES THAT IT WILL NOT PRIOR TO (X) THE DATE
WHICH IS TWO YEARS (OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k)
UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION THEREUNDER) AFTER THE LATER
OF THE ORIGINAL ISSUE DATE HEREOF (OR, OF ANY PREDECESSOR OF THIS SECURITY) OR
THE LAST DAY ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER
OF THIS SECURITY (OR ANY PREDECESSOR OF THIS SECURITY) AND (Y) SUCH LATER DATE,
IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAWS (THE "RESALE RESTRICTION
TERMINATION DATE"), OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT (A)
TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS
A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT
OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE
SECURITIES ACT OR (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT IT WILL GIVE
TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO
THE EFFECT OF THIS LEGEND; PROVIDED THAT THE COMPANY AND THE WARRANT AGENT SHALL
HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (1) PURSUANT TO CLAUSE
(D) OR (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION
AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (II) IN EACH OF THE
FOREGOING CASES, TO REQUIRE THAT A CERTIFICATION OR TRANSFER IN THE FORM
APPEARING ON THE OTHER SIDE OF THIS SECURITY IS COMPLETED AND DELIVERED BY THE
TPANSFEROR TO THE WARRANT AGENT, THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF
THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE. AS USED HEREIN, THE
TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE
MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.
The Global Warrants shall also bear the following legend on
the face thereof:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY ("DTC") TO
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THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE &
CO. OR SUCH OTHER REPRESENTATIVE OF DTC AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE 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 CEDE & CO. 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 SECTIONS 2.9 AND 2.10 OF THE WARRANT
AGREEMENT.
2.6 Temporary Warrant Certificates. Pending the preparation of
Definitive Warrant Certificates, the Company may execute, and the Warrant Agent
shall countersign and deliver, temporary Warrant Certificates, which are
printed, lithographed, typewritten or otherwise produced, substantially of the
tenor of the Definitive Warrant Certificates in lieu of which they are issued
and with such appropriate insertions, omissions, substitutions and other
variations as the officers executing such Warrant Certificates may determine, as
evidenced by their execution of such Warrant Certificates.
If temporary Warrant Certificates are issued, the Company will
cause Definitive Warrant Certificates to be prepared without unreasonable delay.
After the preparation of Definitive Warrant Certificates, the temporary Warrant
Certificates shall be exchangeable for Definitive Warrant Certificates upon
surrender of the temporary Warrant Certificates at any office or agency
maintained by the Company for that purpose pursuant to Section 2.11 hereof.
Subject to the provisions of Section 3.6 hereof, such exchange shall be without
charge to the holder. Upon surrender for cancellation of any one or more
temporary Warrant Certificates, the Company shall execute, and the Warrant Agent
shall countersign and deliver in exchange therefor, one or more Definitive
Warrant Certificates representing in the aggregate a like number of Warrants.
Until so exchanged, the holder of a temporary Warrant Certificate shall in all
respects be entitled to the same benefits under this Agreement as a holder of a
Definitive Warrant Certificate.
2.7 Registration, Registration of Transfers and Exchanges. The
Company will keep, at the office or agency maintained by the Company for such
purpose, a register or registers in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the registration
of, and registration of transfer and exchange of, Warrants as provided herein.
Each person designated by the Company from time to time as a Person authorized
to register the transfer and exchange of the Warrants is hereinafter called,
individually and collectively, the "Warrant Registrar." The Company hereby
initially appoints the Warrant Agent as Warrant
9
Registrar. Upon written notice to the Warrant Agent and any acting Warrant
Registrar, the Company may appoint a successor Warrant Registrar for such
purposes.
The Company will at all times designate one Person (who may be
the Company and who need not be a Warrant Registrar) to act as repository of a
master list of names and addresses of the holders of Warrants (the "Warrant
Register"). The Warrant Agent will act as such repository unless and until some
other Person is, by written notice from the Company to the Warrant Agent and the
Warrant Registrar, designated by the Company to act as such. In the event the
Warrant Registrar is not the repository, the Company shall cause the Warrant
Registrar to furnish to such repository, on a current basis, such information as
to all registrations of transfer and exchanges effected by the Warrant
Registrar. as may be necessary to enable such, repository, to maintain the
Warrant Register on as current a basis as is practicable.
When Warrants are presented to the Warrant Agent with a
request to register the transfer of the Warrants or exchange Warrants for an
equal number of Warrants of other authorized denominations, the Warrant Agent
shall register the transfer or make the exchange requested if the requirements
under this Warrant Agreement as set forth herein for such transactions are met
provided, however, that the Warrants presented or surrendered for registration
of transfer or exchange shall be duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the Company and the Warrant
Agent, duly executed by the holder thereof or by his attorney, duly authorized
in writing.
Furthermore, any Holder of a Global Warrant shall, by
acceptance of such Global Warrant, agree that transfers of beneficial interests
in such Global Warrant may be effected only through a book-entry system
maintained by the Holder of such Global Warrant (or its agent), and that
ownership of a beneficial interest in the Warrant shall be required to be
reflected in a book entry.
All Warrants issued upon any registration of transfer or
exchange of Warrants shall be the valid obligations of the Company, evidencing
the same obligations, and entitled to the same benefits under this Agreement, as
the Warrants surrendered upon such registration of transfer or exchange.
2.8 Book-Entry Provisions for Global Warrants
(a) Registered Owner of Global Warrants. Each Global Warrant
initially shall (i) be registered in the name of DTC for such global Warrant or
the nominee of the Depositary, (ii) be delivered to the Warrant Agent as
custodian for such Depositary and (iii) bear legends as set forth in Section
2.5.
Members of, or participants in, DTC ("Agent Members") shall
have no rights under this Agreement with respect to any Global Warrant held on
their behalf by DTC, or the Warrant Agent as its custodian, or under the Global
Warrant, and DTC 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
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authorization furnished by DTC or shall impair, as between DTC and its Agent
Members, the operation of customary practices governing the exercise of the
rights of a Holder of any Warrant.
(a) Transfers of Global Warrants. Transfers of a Global
Warrant shall be limited to transfers of such Global Warrant in whole, but not
in part, to DTC, its successors or their respective nominees. Interests of
beneficial owners in a Global Warrant may be transferred in accordance with the
rules and procedures of DTC and the provisions of Section 2.8. If required to do
so pursuant to any applicable law or regulation, beneficial owners may obtain
Warrants in definitive form, in exchange for their beneficial interests in a
Global Warrant upon written request in accordance with DTC's and the Warrant
Registrar's procedures. In addition, Definitive Warrants shall be transferred to
all beneficial owners in exchange for their beneficial interests in a Global
Warrant if (i) DTC (A) notifies the Company that it is unwilling or unable to
continue as depository for the Global Warrant and the Company thereupon fails to
appoint a successor depository upon 90 days or (B) has ceased to be a clearing
agency registered under the Exchange Act and the Company thereupon fails to
appoint a successor depository upon 90 days, (ii) upon the continuance of an
Event of Default under the Indenture or (iii) the Company, at its option,
notifies the Warrant Agent in writing that it elects to cause issuance of
Definitive Warrants. In addition, beneficial interests in a Global Warrant may
be exchanged for Definitive Warrants upon request but only upon at least 20
days' prior written notice given to the Warrant Agent by or on behalf of DTC in
accordance with customary procedures. In all cases, Definitive Warrants
delivered in exchange for any Global Warrants or beneficial interest therein
will be registered in names, and issued in any approved denominations, requested
by or on behalf of DTC (in accordance with its customary procedures) and will
bear, the Private Placement Legend set forth in Section 2.5, if applicable,
unless the Company determines otherwise in compliance with applicable law.
(b) In connection with any transfer of a portion of the
beneficial interest in a Global Warrant pursuant to subsection (b) of this
Section 2.9 to beneficial owners who are required to hold Definitive Warrants,
the Warrant Registrar shall reflect on its books and records the date and a
decrease in the amount of such Global Warrant in an amount equal to the amount
of the beneficial interest in the Global Warrant to be transferred. and the
Company shall execute, and the Warrant Agent shall countersign and deliver, one
or more Definitive Warrants of like tenor and amount.
(c) In connection with the transfer of an entire Global
Warrant to beneficial owners pursuant to subsection (b) of this Section 2.9,
such Global Warrant shall be deemed to be surrendered to the Warrant Agent for
cancellation, and the Company shall execute, and the Warrant Agent shall
countersign and deliver, to each beneficial owner identified by DTC in exchange
for its beneficial interest in such Global Warrant, an equal aggregate amount of
Definitive Warrants of authorized denominations.
(d) Any Definitive Warrant delivered in exchange for an
interest in a Global Warrant pursuant to subsection (c) or subsection (d) of
this Section shall, except as otherwise provide herein, bear the Private
Placement Legend set forth in Section 2.5, if applicable.
(e) The Holder of a Global Warrant may grant proxies and
otherwise authorize any Person, including Agent Members and Persons that may
hold interests through
11
Agent, Members, to take any action which a Holder is entitled to take under this
Agreement or the Warrants.
2.9 Special Transfer Provisions
(a) Any beneficial interest in one of the Global Warrants that
is transferred to a Person who takes delivery in the form of an interest in the
other Global Warrant will, upon transfer, cease to be an interest in such Global
Warrant and become an interest in the other Global Warrant and, accordingly,
will thereafter be subject to all transfer restrictions and other procedures
applicable to beneficial interests in such other Global Warrant for as long as
it remains such an interest.
(b) Other Exchange. In the event that a Global Warrant is
exchanged for Definitive Warrants in registered form pursuant to Section 2.9(b),
such Warrants may be exchanged or transferred for one another only in accordance
with such procedures as are substantially consistent with the provisions of
Sections 2.10(a) and (b) above (including the certification requirements
intended to ensure that such exchanges or transfers comply with Rule 144, Rule
144A or Regulation S under the Securities Act, as the case may be) and as may be
from time to time adopted by the Company and the Warrant Agent.
(c) Private Placement Legend. Upon the transfer, exchange or
replacement of Warrants not bearing the Private Placement Legend, the Warrant
Registrar shall deliver Warrants that do not bear the Private Placement Legend.
Upon the transfer, exchange or replacement of Warrants bearing the Private
Placement Legend, the Warrant Registrar shall deliver only Warrants that bear
the Private Placement Legend unless there is delivered to the Warrant Registrar
an Opinion of Counsel reasonably satisfactory to the Company and the Warrant
Agent to the effect that neither such legend nor the related restrictions on
transfer are required in order to maintain compliance with the provisions of the
Securities Act.
(d) General. The provisions hereof shall be qualified in their
entirety by any applicable securities laws of the United States and any other
applicable jurisdiction and by the procedures of any applicable clearing agency,
in each case as in effect from time to time, and all such laws and clearing
procedures shall be deemed to be incorporated herein by reference. By its
acceptance of any Warrant bearing the Private Placement Legend, each Holder of
such a Warrant acknowledges the restrictions on transfer of such Warrant set
forth in this Agreement and in the Private Placement Legend and agrees that it
will transfer such Warrant only as provided in this Agreement. The Warrant Agent
shall not register a transfer of any Warrant Certificate unless such transfer
complies with the restrictions on transfer of such Warrant Certificate set forth
in this Warrant Agreement.
The Warrant Registrar shall retain copies of all letters,
notices and other written communications received pursuant to Section 2.8 or
this Section 2.9. The Company shall have the right to inspect and make copies of
all such letters, notices or other written communications at any reasonable time
upon the giving of reasonable written notice to the Warrant Registrar.
(e) 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
12
participant in DTC or other Person with respect to any ownership interest in the
Warrants, with respect to the accuracy of the records of DTC or its nominee or
of any participant or member thereof or with respect to the delivery to any
participant, member, beneficial owner or other Person (other than DTC) of any
notice (including any notice of redemption) or the payment of any amount, under
or with respect to such Warrants. All notices and communications with respect to
the Warrants shall be given to the Holders and all payments in respect of the
Warrants represented by the Global Warrant shall be made by wire transfer of
immediately available funds to the accounts specified by the Holder of the
Global Warrant. With respect to Definitive Warrants, the Company will make all
payments by wire transfer of immediately available funds to the accounts
specified by the Holders thereof or, if no such account is specified, by mailing
a check to each such Holder's registered address. The rights of beneficial
owners in any Global Warrant shall be exercised only through DTC subject to the
applicable rules and procedures of DTC. The Warrant Agent may rely and shall be
fully protected and indemnified pursuant to Section 6.5 in relying upon
information furnished by DTC with respect to any beneficial owners, its members
and participants.
(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 without limitation any
transfers between or among DTC participants, members or beneficial owners in any
Global Warrant) other than to require delivery of such certificates and other
documentation of 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.
2.10 Offices for Exercise, Etc. So long as any of the Warrants
remain outstanding, the Company will designate and maintain in the Borough of
Manhattan, The City of New York: (a) an office or agency where the Warrant
Certificates may be presented for exercise, (b) an office or agency where the
Warrant Certificates may be presented for registration of transfer and for
exchange (including the exchange of temporary Warrant Certificates for
Definitive Warrant Certificates pursuant to Section 2.6 hereof), and (c) an
office or agency where notices and demands to or upon the Company in respect of
the Warrants or of this Agreement may be served. The Company may from time to
time change or rescind such designation, as it may deem desirable or expedient;
provided, however, that an office or agency shall at all times be maintained in
the Borough of Manhattan, The City of New York as provided in the first sentence
of this Section. In addition to such office or offices or agency or agencies,
the Company may from time to time designate and maintain one or more additional
offices or agencies, within or outside The City of New York where Warrant
Certificates may be presented for exercise or for registration of transfer or
for exchange, and the Company may from time to time change or rescind such
designation, as it may deem desirable or expedient. The Company will give to the
Warrant Agent and the Warrant Registrar written notice of the location of any
such office or agency and of any change of location thereof. The Company hereby
designates the Warrant Agent at its corporate trust office in the Borough of
Manhattan, The City of New York (the "Warrant Agent Office"), as the initial
agency maintained for each such purpose. In case the Company shall fail to
maintain any such office or agency or shall fail to give such notice of the
location or of any change in the location thereof, presentations and demands may
be made
13
and notice may be served at the Warrant Agent Office and the Company
appoints the Warrant Agent as its agent to receive all such presentations,
surrenders, notices and demands.
2.11 Cancellation. All Warrant Certificates surrendered for
the purpose of exercise (in whole or in part), exchange, substitution or
transfer shall, if surrendered to the Company or to any of its agents, be
delivered to the Warrant Agent for cancellation or in cancellation form, or if
surrendered to the Warrant Agent shall be cancelled by it, and no Warrant
Certificates shall be issued in lieu thereof except as expressly permitted by
any of the provisions of this Agreement. If the Company purchases or acquires
Warrants and if the Company so chooses, the Company may deliver to the Warrant
Agent for cancellation and retirement, and the Warrant Agent shall so cancel and
retire (subject to the record retention provisions of the Exchange Act), the
Warrant Certificates evidencing said Warrants. The Warrant Agent shall destroy
such cancelled Warrant Certificates, and in such case shall upon the written
request of the Company deliver a certificate of destruction thereof to the
Company. The Warrant Agent shall account promptly to the Company with respect to
Warrants exercised and concurrently pay to the Company all monies received by
the Warrant Agent for the purchase of the Warrant Shares through the exercise of
such Warrants.
2.12 Lost, Stolen, Destroyed, Defaced or Mutilated Warrant
Certificates. Upon receipt by the Company and the Warrant Agent (or any agent of
the Company or the Warrant Agent, if requested by the Company) of evidence
satisfactory to them of the loss, theft, destruction, defacement, or mutilation
of any Warrant Certificate and of indemnity satisfactory to them (which may
include posting a bond) and, in the case of mutilation or defacement. upon
surrender thereof to the Warrant Agent for cancellation, then, in the absence of
notice to the Company or the Warrant Agent that such Warrant Certificate has
been acquired by a bona fide purchaser or holder in due course, the Company
shall execute, and an authorized signatory, of the Warrant Agent shall manually
countersign and deliver, in exchange for or in lieu of the lost, stolen,
destroyed, defaced or mutilated Warrant Certificate, a new Warrant Certificate
representing a like number of Warrants, bearing a number or other distinguishing
symbol not contemporaneously outstanding. Upon the issuance of any new Warrant
Certificate under this Section, the Company may require the payment from the
holder of such Warrant Certificate of a sum sufficient to cover any tax, stamp
tax or other governmental charge that may be imposed in relation thereto and any
other expenses (including the fees and expenses of the Warrant Agent and the
Warrant Registrar) in connection therewith. Every substitute Warrant Certificate
executed and delivered pursuant to this Section in lieu of any lost, stolen or
destroyed Warrant Certificate shall constitute an additional contractual
obligation of the Company, whether or not the lost, stolen or destroyed Warrant
Certificate shall be at any time enforceable by anyone, and shall be entitled to
the benefits of (but shall be subject to all the limitations of rights set forth
in) this Agreement equally and proportionately with any and all other Warrant
Certificates duly executed and delivered hereunder. The provisions of this
Section 2.13 are exclusive with respect to the replacement of lost, stolen,
destroyed, defaced or mutilated Warrant Certificates and shall preclude (to the
extent lawful) any and all other rights or remedies notwithstanding any law or
statute existing or hereafter enacted to the contrary with respect to the
replacement of lost, stolen, destroyed, defaced or mutilated Warrant
Certificates.
14
The Warrant Agent is hereby authorized to countersign in
accordance with the provisions of this Agreement, and deliver the new Warrant
Certificates required pursuant to the provisions of this Section.
SECTION 3. Terms of Warrants; Exercise of Warrants.
3.1 Exercise Period. Subject to the terms of the this
Agreement, each Warrant Holder shall have the right, which may be exercised
commencing at the opening, of business on the Exercisability Date and until 5:00
p.m., New York City time on the Expiration Date, to receive from the Company the
number of fully paid and nonassessable Warrant Shares which the Holder may at
the time be entitled to receive on exercise of such Warrants and payment of the
Exercise Price then in effect for such Warrant Shares. Each Warrant not
exercised prior to 5:00 p.m., New York City time, on the Expiration Date shall
become void and all rights thereunder and all rights in respect thereof under
this Agreement shall cease as of such time.
The Company shall give notice not less than 90, and not more
than 120 days prior to the Expiration Date to the Holders of the outstanding
Warrants to the effect that the Warrants will terminate and become void as of
5:00 p.m., New York City time, on the Expiration Date; provided, however, that
the failure by the Company to give such notice as provided in this Section shall
not affect such termination and becoming void of the Warrants as of 5:00 p.m.,
New York City time, on the Expiration Date.
3.2 Manner of Exercise. A Warrant may be exercised at any time
on or after the Exercisability Date and prior to the Expiration Date upon (i)
surrender to the Warrant Agent of the Warrant Certificates, together with the
form of election to purchase properly completed and executed by the Holder
thereof and (ii) payment to the Warrant Agent, for the account of the Company,
of the Exercise Price for each share of Common Stock or other securities
issuable upon exercise of such Warrants. The Exercise Price may be paid (i) in
cash or by certified or official bank check or by wire transfer to an account
designated by the Company for such purpose (a "Cash Exercise") or (ii) without
the payment of cash, by reducing the number of shares of 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 (a) the number of shares of Common Stock
for which such Warrant is exercisable as of the date of exercise (if the
Exercise Price were being paid in cash) and (b) the Cashless Exercise Ratio. An
exercise of a Warrant in accordance with clause (ii) of the immediately
preceding sentence is herein called a "Cashless Exercise." In the event of a
Cashless Exercise of Warrants, the Company will purchase from the holder thereof
such number of Warrants as would have entitled the holder thereof to receive the
excess of the number of shares of Common Stock deliverable upon a Cash Exercise
over the number of shares of Common Stock deliverable upon a Cashless Exercise,
for a purchase price equal to the Exercise Price multiplied by the excess of the
number of shares of Common Stock purchasable upon a Cash Exercise over the
number of shares of Common Stock purchasable upon a Cashless Exercise. The
Company agrees to offset the purchase price referred to in the immediately
preceding sentence with the obligation to pay the Exercise Price in respect of
the shares of Common Stock deliverable upon 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
15
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. Upon surrender of the Warrant Certificate and
payment of the Exercise Price in accordance with this Agreement, the Company
will issue shares of Common Stock of the Company for each Warrant evidenced by
such Warrant Certificate, subject to adjustment as described herein. Whenever
there occurs a Cashless Exercise, the Company shall deliver to the Warrant Agent
a certificate setting forth the Cashless Exercise Ratio. The Warrant Agent shall
be entitled to rely or 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 the Cashless Exercise
Ratio is correct or with respect to the method employed in determining the
Cashless Exercise Ratio or the validity or value of any shares of Common Stock.
3.3 Issuance of Warrant Shares. Subject to Section 2.12, upon
the surrender of Warrant Certificates and payment of the Exercise Price, as set
forth above, the Company shall issue shares of Common Stock in such name or
names as the Holder may designate, 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, together with cash as provided in Section 3.4 in respect of
any fractional Warrant Shares otherwise issuable upon such exercise. Such shares
of Common Stock shall be deemed to have been issued and any Person so designated
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 or upon a Cashless Exercise.
The Company hereby agrees that no service charge will be made
for registration of transfer or exchange upon surrender of any Warrant
Certificate at the office of the Warrant Agent maintained for that purpose.
Holders may be required to make payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any
registration or transfer or exchange of Warrant Certificates.
3.4 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
purchasable pursuant thereto. If any fraction of a Warrant Share would, except
for the provisions of this Section 3.4, be issuable on the exercise of any
Warrant (or specified portion thereof), the Company may, at its option, pay an
amount in cash equal to the Current Market Value for one Warrant Share on the
Business Day immediately preceding the date the Warrant is exercised, multiplied
by such fraction, computed to the nearest whole U.S. Dollars.
3.5 Sufficient Authorized Share Capital. The Company has and
will maintain an authorized share capital sufficient for the issuance of such
number of shares of Common Stock as will be issuable upon the exercise of all
outstanding Warrants. Such shares of Common Stock, when issued and paid for in
accordance with the Agreement, will be duly and validly
16
issued, fully paid and nonassessable, free of preemptive rights and free from
all liens, charges and security interests with respect to the issue thereof.
3.6 Payment of Taxes. The Company will pay all documentary
stamp taxes attributable to the initial issuance of the Warrants and the Warrant
Shares issuable upon the exercise of Warrants, provided, however, that the
Company shall not be required to pay any tax or taxes which may be payable in
respect of any transfer involved in the issue of any Warrant Certificates or
Warrant Shares in a name other than that of the Holder of a Warrant Certificate
surrendered upon the exercise of a Warrant, and the Company shall not be
required to issue or deliver such Warrant Certificates unless or until the
Person or Persons requesting the issuance thereof shall have paid to the Company
the amount of such tax or shall have established to the satisfaction of the
Company that such tax has been paid.
SECTION 4. Adjustment of Exercise Price and Number of Warrant
Shares Issuable
4.1 Adjustments. The Exercise Price and the number of Warrant
Shares purchasable upon the exercise of Warrants shall be subject to adjustment
from time to time as follows:
(a) Adjustments under the Plan of Reorganization. In the event
that the Company makes adjustments to the aggregate claims, the
percentage allocations or the number of shares of Common Stock to be
issued on account of existing bonds of the Company under the Plan of
Reorganization, the Company may change the number of Warrants to be
issued, the number of shares of Common Stock purchasable under the
terms of such Warrants and the Exercise Price in accordance with any
such adjustments under the Plan of Reorganization. Any adjustment made
pursuant to this Section 4.1 (a) shall become effective on the Issue
Date.
(b) Changes in shares of Common Stock. In the event that at
any time or from time to time after the date hereof the Company shall
(i) pay a dividend or make a distribution on its shares of 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 Common Stock outstanding
by reclassification of its shares of Common Stock, then the number of
shares of Common Stock purchasable upon exercise of each Warrant
immediately after the happening of such event shall be adjusted
(including by adjusting the definition of "Warrant Shares") so that,
after giving effect to such adjustment, the Holder of each Warrant
shall be entitled to receive the number of shares of Common Stock upon
exercise 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 shares of Common Stock, immediately prior to the
record date therefor). An adjustment made pursuant to this Section
4.1(a) shall become effective immediately after the effective date,
retroactive to the record date therefor in the case of a dividend or
distribution in shares of Common
17
Stock, and shall become effective immediately after the effective date
in the case of a subdivision, combination or reclassification.
(c) Cash Dividends and Other Distributions. In case at any
time or from time to time after the date hereof the Company shall
distribute to Holders of shares of Common Stock (i) any dividend or
other distribution 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 each case set forth in (i) and (ii), (x)
any dividend or distribution described in Section 4.1(a) or (y) any
rights, options, warrants or securities described in Section 4.1(c))
then the number of Warrant Shares purchasable upon the exercise of each
Warrant shall be increased to a number determined by multiplying the
number of shares of Common Stock issuable immediately prior to the
record date upon exercise of each Warrant by a fraction, the numerator
of which shall be the sum of (x) any cash distributed per Warrant Share
and (y) the Current Market Value of the portion, if any, of the
distribution applicable to one Warrant Share consisting of evidences of
indebtedness, shares of stock, securities, other property, warrants,
options or subscription of purchase rights and the denominator of which
shall be the Current Market Value of the shares of Common Stock
comprising one Warrant Share immediately after such dividend or other
distribution. Such adjustment shall be made whenever any distribution
is made and shall become effective as of the date of distribution,
retroactive to the record date for any such distribution; provided,
however, that the Company is not required to make an adjustment
pursuant to this Section 4.1(b) if at the time of such distribution the
Company makes the same distribution to Holders of Warrants as it makes
to holders of shares of Common Stock pro rata based on the number of
shares of Common Stock for which such Warrants are exercisable (whether
or not currently exercisable). No adjustment shall be made pursuant to
this Section 4.1(b) which shall have the effect of decreasing the
number of Warrant Shares purchasable upon exercise of each Warrant.
(d) Rights Issue. In the event that at any time or from time
to time after the date hereof the Company shall issue, sell, distribute
or otherwise grant any rights to subscribe for or to purchase, or any
options or warrants for the purchase of, or any securities convertible
or exchangeable into, shares of Common Stock to all holders of shares
of Common Stock, entitling such holders to subscribe for or purchase
shares of Common Stock or stock or securities convertible into shares
of Common Stock within 60 days after the record date for such issuance,
sale, distribution or other grant, as the case may be, and the sum of
(a) the offering price of such right, option, warrant or other security
('on a per share basis) and (b) any subscription, purchase, conversion
or exchange price per share of shares of Common Stock (the
"Consideration") is lower at the record date for such issuance than the
then Current Market Value per share of such shares of Common Stock, the
number of shares of Common Stock thereafter purchasable shall be
increased to a number determined by multiplying the number of shares of
Common Stock issuable immediately prior to the record date upon
exercise of each Warrant by a fraction, the numerator of which shall be
the number of shares of Common Stock outstanding on the date of
issuance of such rights, options, warrants or securities plus the
number of additional shares of Common Stock offered for subscription or
purchase or into or for which such securities are convertible or
exchangeable, and the
18
denominator of which shall be the number of shares of Common Stock
outstanding on the date of issuance of such rights, options, warrants
or securities plus the total number of shares of Common Stock which
could be purchased at the Current Market Value with the aggregate of
the Consideration with respect to such issuance, sale, distribution or
other grant. Such adjustment shall be made whenever such rights,
options or warrants are issued and shall become effective retroactively
immediately after the record date for the determination of stockholders
entitled to receive such rights. options, warrants or securities,
provided, however, that the Company is not required to make an
adjustment pursuant to this Section 4.1(c) if the Company shall make
the same distribution to Holders of Warrants. No adjustment shall be
made pursuant to this Section 4.1(c) which shall have the effect of
decreasing the number of shares of Common Stock purchasable upon
exercise of each Warrant.
If the Company at any time shall issue two or more securities
as a unit and one or more of such securities shall be rights, options
or warrants for or securities convertible or exchangeable into, shares
of Common Stock subject to this Section 4.1(c), the consideration
allocated to each such security shall be determined in good faith by
the Board.
(e) Combination; Liquidation. (i) Except as provided in clause
(ii) below, in the event of certain consolidations, mergers or
demergers of the Company, or the sale of all or substantially all of
the assets of the Company to another Person (a "Combination"), each
Warrant will thereafter be exercisable for the right to receive the
kind and amount of shares of stock or other securities or property to
which such holder would have been entitled as a result of such
Combination had the Warrants been exercised immediately prior thereto.
Unless clause (ii) is applicable to a Combination, if any Warrants
shall be outstanding after 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 4.1(d) and
providing for adjustments, which shall be as nearly equivalent as may
be practicable to the adjustments provided for in this Section 4. The
provisions of this Section 4.1(d) shall similarly apply to successive
Combinations involving any Successor Company.
(ii) In the event of (A) a Combination, and, in connection
therewith, the consideration payable to the holders of shares of Common
Stock in exchange for their shares is payable solely in cash or (B) a
dissolution, liquidation or winding-up of the Company, then the holders
of the Warrants will be entitled to receive distributions on an equal
basis with the holders of shares of 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.
Upon receipt of such payment, if any, the Warrants will expire and the
rights of holders thereof will cease.
(iii) In the case of any such Combination, the surviving or
acquiring Person as described in this Section 4.1(d) 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 to the holders of the Warrants the amounts to
19
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, or by wire transfer
of same-day funds, 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.
4.2 Tender Offers: Exchange Offers. In the event that the
Company or any subsidiary of the Company shall purchase shares of Common Stock
pursuant to a tender offer or an exchange offer for a price per share of Common
Stock that is greater than the then Current Market Value per share of shares of
Common Stock in effect at the end of the trading day immediately following the
day on which such tender offer or exchange offer expires, then the Company, or
such subsidiary of the Company, shall, within 10 Business Days of the expiry of
such tender offer or exchange offer, offer to purchase Warrants for comparable
consideration per share of Common Stock based on the number of shares of Common
Stock which the Holders of such Warrants would receive upon exercise of such
Warrants (the "Offer") (such amount less the Exercise Price in respect of such
share, the "Per Share Consideration"); provided, however, if a tender offer is
made for only a portion of the outstanding shares of Common Stock, then such
offer shall be made for such shares of Common Stock issuable upon exercise of
the Warrants in the same pro rata proportion.
The Offer shall remain open for a period of 20 Business Days
following its commencement and no longer, except to the extent that a longer
period is required by applicable law (the "Offer Period"). No later than five
Business Days after the termination of the Offer Period (the "Purchase Date"),
the Company shall purchase such Warrants for the applicable Per Share
Consideration.
4.3 Other Events. If any event occurs as to which the
foregoing provisions of this Section 4 are 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 the 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 the Board, to protect such purchase rights as aforesaid.
4.4 When No Adjustment Required. Without limiting any other
exception contained in this Section 4.1 and in addition thereto, no adjustment
need be made for:
(i) (A) grants to, exercises of Rights by, or issuances of
equity securities to employees, directors, consultants or advisors of
the Company or any of its subsidiaries and (B) exercises of Rights by,
or issuances of equity securities in connection with Rights previously
issued to former employees, former directors, former consultants (to
the extent that all such securities, other than those permitted by
clause (ii) below, do not have an aggregate value in excess of 15% of
the equity value of the Company on a fully diluted basis, as determined
in good faith by the Board). As used herein, "Right" shall mean any
right, option, warrant
20
or convertible or exchangeable security containing the right to
subscribe for or acquire on or more shares of Common Stock, excluding
the Warrants;
(ii) options, warrants or other agreements or rights to
purchase capital stock of the Company entered into or granted prior to
the date of the issuance of the Warrants or any issuance of capital
stock pursuant thereto or in connection therewith;
(iii) bona fide public offerings or private placements through
investment banks of international standing;
(iv) rights to purchase shares of Common Stock pursuant to a
Company plan for reinvestment of dividends or interest; and
(v) a change in the par value of shares of Common Stock
(including a change from par value to no par value or vice versa).
(b) Adjustment of Exercise Price. Whenever the number of
shares of Common Stock purchasable upon the exercise of each Warrant is
adjusted, as provided under this Section 4, the Exercise Price per share of
Common Stock payable upon exercise of such Warrant shall be adjusted (calculated
to the nearest NLG 0.01) so that it shall equal the price determined by
multiplying such Exercise Price immediately prior to such adjustment by a
fraction the numerator of which shall be the number of shares of Common Stock
purchasable upon the exercise of each Warrant immediately prior to such
adjustment and the denominator of which shall be the number of shares of Common
Stock so purchasable immediately thereafter. Following any adjustment to the
Exercise Price pursuant to this Section 4, the amount payable, when adjusted,
shall never be less than the par value per share of Common Stock at the time of
such adjustment.
If after an adjustment, a Holder of a Warrant upon exercise of
it may receive shares of two or more classes of capital stock of the Company,
the Company shall determine the allocation of the adjusted Exercise Price
between such classes of shares in a manner that the Board deems fair and
equitable to the Holders. After such allocation, the exercise privilege and the
Exercise Price of each class of shares shall thereafter be subject to adjustment
on terms comparable to those applicable to shares of Common Stock under this
Section 4.
Such adjustment shall be made successively whenever any event
listed above shall occur.
4.5 Superseding Adjustment. Upon the expiration of any rights,
options, warrants or conversion or exchange privileges which resulted in the
adjustments pursuant to this Section 4, if any thereof shall not have been
exercised, the number of Warrant Shares purchasable upon the exercise of each
Warrant shall be readjusted as if (A) 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 (B) shares of Common Stock actually issued, if any, were issuable for the
consideration actually received by the Company
21
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;
provided, however, that no such readjustment shall (except by reason of an
intervening adjustment under Section 4.1(a)) have the effect of decreasing the
number of Warrant Shares purchasable upon the exercise of each Warrant 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.
4.6 Minimum Adjustment. The adjustments required by the
preceding Sections of this Section 4 shall be made whenever and as often as any
specified event requiring an adjustment shall occur, except that no adjustment
of the number of shares of Common Stock purchasable upon exercise of Warrants
that would otherwise be required shall be made (except in the case of a
subdivision or combination of shares of Common Stock, as provided for in Section
4.1(a)) unless and until such adjustment either by itself or with other
adjustments not previously made increases or decreases by at least 1% of the
number of shares of Common Stock purchasable upon exercise of 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
Section 4 and not previously made, would result in a minimum adjustment. For the
purpose of any adjustment, any event shall be deemed to have occurred at the
close of business on the date of its occurrence. In computing adjustments under
this Section 4, fractional interests in shares of Common Stock shall be taken
into account to the nearest one-hundredth of a share.
4.7 Notice of Adjustment. Whenever the number of shares of
Common Stock and other property, if any, purchasable upon exercise of Warrants
is adjusted, as herein provided, the Company shall deliver to the Warrant Agent
a certificate of a firm of internationally recognized independent accountants
(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
the Board determined the fair market value of any evidences of indebtedness,
other securities or property or warrants or other subscription or purchase
rights), and specifying the number of shares of Common Stock purchasable upon
exercise of Warrants after giving effect to such adjustment. The Company shall
promptly mail, or at the expense of the Company cause the Warrant Agent to mail,
a copy of such certificate to each Holder in accordance with Section 7.2. 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 number of shares of Common Stock
or other stock or property, purchasable 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.
4.8 Notice of Certain Transactions. In the event that the
Company shall propose (a) to pay any dividend payable in securities of any class
to the holders of its shares of Common Stock or to make any other distribution
to the holders of its shares of Common Stock, (b) to offer the holders of its
shares of Common Stock rights to subscribe for or to purchase any
22
securities convertible into shares of Common Stock or shares of Common Stock or
shares of stock of any class or any other securities, rights or options, (c) to
effect any reclassification of its shares of Common Stock, capital
reorganization or Combination or (d) to effect the voluntary or involuntary
dissolution, liquidation or winding-up of the Company, or in the event of a
tender offer or exchange offer described in Section 4.1(e), the Company shall
within 5 Business Days of making such proposal, tender offer or exchange offer
send to the Warrant Agent and the Warrant Agent shall within 5 Business Days
thereafter 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 to
be mailed by the Company, or at the expense of the Company by the Warrant Agent,
to the Holders at their addresses as they appear in the Warrant Register, which
shall specify the record date for the purposes of such dividend, distribution or
rights, or the date. In such issuance or event is to take place and the date of
participation therein by the holders of shares of Common Stock, if any such date
is to be fixed, and shall briefly indicate the effect of such action on the
shares of 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 Common Stock and
other property, if any, purchasable upon exercise of each Warrant after giving
effect to any adjustment which will be required as a result of such action. Such
notice shall be given by the Company as promptly as possible and, in the case of
any action covered by clause (a) or (b) above, at least 10 Business Days prior
to the record date for determining, holders of the shares of Common Stock for
purposes of such action and, in the case of any other such action, at least 20
Business Days prior to the date of the taking of such proposed action or the
date of participation therein by the holders of shares of Common Stock,
whichever shall be the earlier.
4.9 Adjustment to Warrant Certificate. The form of Warrant
Certificate need not be changed because of any adjustment made pursuant to this
Section 4, and Warrant Certificates issued after such adjustment may state the
same Exercise Price and the same number of shares of Common Stock as are stated
in any Warrant Certificates issued prior to the adjustment. 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.
4.10 Challenge to Good Faith Determination. Whenever the Board
shall be required to make a determination in good faith of the Current Market
Value of any item under Section 4, such determination may be challenged in good
faith by the Majority Holders.
4.11 Treasury Stock. The sale or other disposition of any
issued shares of Common Stock owned or held by or for the account of the Company
shall be deemed an issuance thereof and a repurchase thereof and designation of
such shares as treasury stock shall be deemed to be a redemption thereof for the
purposes of this Agreement.
23
SECTION 5. Warrant Agent
5.1 Appointment of Warrant Agent. The Company hereby appoints
the Warrant Agent to act as agent for the Company in accordance with provisions
of this Agreement and the Warrant Agent hereby accepts such appointment.
5.2 Rights and Duties of Warrant Agent. (a) 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) The Warrant Agent may consult with counsel satisfactory to
it (who may be Carve-Out counsel for 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) 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, certificates of shares, notice,
resolution, direction, consent, certificate, affidavit, statement of other paper
or document believed by it to be genuine and to have been presented or signed by
the proper parties.
(d) The Warrant Agent shall be obligated to perform only such
duties as are herein and in the Warrant Certificates specifically set forth and
no implied duties or obligations shall be read into this Agreement or the
Warrant Certificates against the Warrant Agent. The Warrant Agent shall not be
under any obligation to institute any action, suit or legal proceeding or to
take any other action which may tend to involve it in any expense or liability
for which it does not receive indemnity if such indemnity is 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 on behalf of the Holders
pursuant to this Agreement or for the applications 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) 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 purchasable 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 responsible to determine the Cashless
Exercise Ratio. 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 Section 4, and it makes no representation with
respect thereto. The Warrant Agent shall not be
24
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 Section 4, or to comply with any of the covenants of the
Company contained in Section 4.
(f) Before the Warrant Agent acts or refrains from acting with
respect to any matter contemplated by this Warrant Agreement, it may require
from the Company:
(i) an Officers' Certificate of the Company stating that, in
the opinion of the signers, all conditions precedent, if any, provided
for in this Warrant Agreement relating to the proposed action have been
complied with; and
(ii) an opinion of counsel for the Company stating that, in
the opinion of such counsel, all such conditions precedent have been
complied with.
Each Officers' Certificate or opinion of counsel with respect
to compliance with a condition or covenant provided for in this Warrant
Agreement shall include:
(1) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such Person, he or she
has made such examination or investigation as is necessary to enable
him or her to express an informed opinion as to whether or not such
covenant or conditions has been complied with; and
(4) a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been complied with;
provided, however, that with respect to matters of fact an Opinion of Counsel
may rely on an Officers' Certificate or certificates of public officials.
The Warrant Agent shall not be liable for any action it takes
or omits to take in good faith in reliance on any such certificate or opinion.
(g) The Warrant Agent shall keep copies of this Agreement and
any notices given or received hereunder by or from the Company available for
inspection by the Holders during normal business hours at its office. The
Company shall supply the Warrant Agent from time to time with such numbers of
copies of this Agreement as the Warrant Agent may request.
5.3 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
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
25
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.
5.4 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.
5.5 Compensation and Indemnity. The Company shall pay to the
Warrant Agent from time to time such compensation as the Company and the Warrant
Agent shall from time to time agree in writing for its acceptance of this
Warrant Agreement and services hereunder. The Company shall reimburse the
Warrant Agent upon request for all reasonable disbursements, expenses and
advances (including reasonable fees and expenses of counsel) incurred or made by
it in addition to the compensation for its services, except any such
disbursements, expenses and advances as may be attributable to the Warrant
Agent's or any Agent's negligence or bad faith. Such expenses shall include the
reasonable compensation, disbursements, and expenses of the Warrant Agent's
accountants, experts and counsel.
The Company shall indemnify each of the Warrant Agent and any
predecessor Warrant Agent for, and hold them harmless against, any and all loss,
damage, claim, expense or liability including taxes (other than taxes based on
the income of the Warrant Agent) incurred by the Warrant Agent without
negligence, willful misconduct or bad faith on its part in connection with
acceptance of administration of this trust and its duties under this Warrant
Agreement, including the reasonable expenses and attorneys' fees and expenses of
defending itself against any claim of liability arising hereunder. The Warrant
Agent shall notify the Company promptly of any claim asserted against the
Warrant Agent for which it may seek indemnity. However, the failure by the
Warrant Agent to so notify the Company shall not relieve the Company of its
obligations hereunder. The Company shall defend the claim and the Warrant Agent
shall cooperate in the defense (and may employ its own counsel satisfactory to
the Warrant Agent) at the Company's expense. The Warrant Agent may have separate
counsel and the Company shall pay the reasonable fees and expenses of such
counsel. The Company need not pay for any settlement made without its written
consent which consent shall be unreasonably withheld. The Company need not
reimburse any expense or indemnify against any loss or liability incurred by the
Warrant Agent as a result of the violation of this Warrant Agreement by the
Warrant Agent if such violation arose from the Warrant Agent's negligence or bad
faith.
To secure the Company's payment obligations in this Section
6.5, the Warrant Agent shall have a senior lien against all money or property
held or collected by the Warrant Agent in its capacity as Warrant Agent.
When the Warrant Agent incurs expenses or renders services
after an Event of Default specified in the Indenture occurs, the expenses
(including the reasonable fees and expenses of its agents and counsel) and the
compensation for the services shall be preferred over the status of the Holders
in a proceeding under any Bankruptcy Law and are intended to constitute expenses
of administration under any Bankruptcy Law. The Company's obligations under this
Section 6.5 and any claim arising hereunder shall survive the termination of
this
26
Warrant Agreement, the registration or removal of any Warrant Agent, and any
rejection or termination under any Bankruptcy Law.
5.6 Successor Warrant Agent. (a) 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) 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 30 days after the date on which such notice is
given unless the Company otherwise agrees. The Warrant Agent hereunder may be
removed at any time by 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 30 days after such notice is
given unless the Warrant Agent otherwise agrees. Any removal under this Section
6.6. 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) In case 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
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 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 of 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 hereunder, such resignation shall be effective on the
earlier of (i) the date specified in the Warrant's Agent's notice of resignation
and (ii) the appointment and acceptance of a successor Warrant Agent hereunder.
(d) Any successor Warrant Agent appointed hereunder shall
execute, 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,
27
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) 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 its corporate trust business, provided 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.
SECTION 6. Miscellaneous
6.1 Reports. (a) The Company will file on a timely basis with
the Commission, to the extent such filings are accepted by the Commission and
the Company has a class of securities registered under the Exchange Act, (i) all
annual and quarterly financial statements and other financial information
required to be a filed with the Commission under the Exchange Act and (ii) all
current reports that are required to be filed with the Commission on Form 8-K.
(b) The Company will also be required (a) to file with the
Warrant Agent, and provide to each holder of the Warrants or Warrant Shares,
without cost to such holder, copies of such reports and documents within 15 days
after the date on which the Company files such reports and documents with the
Commission or the date on which the Company is required to file such reports and
documents.
6.2 Notices to the Company and Warrant Agent. Any notice or
demand authorized by this Agreement to be given or made by the Warrant Agent or
by the Holder of any Warrant Certificate to or on the Company shall be
sufficiently given or made (i) five business days after deposited in the mail,
first class or registered, postage prepaid, (ii) one business day after being
timely delivered to a next-day air courier or (ii) when receipt is acknowledged
by the addressee, if telecopied, addressed (until another address is filed in
writing by the Company with the Warrant Agent), as follows:
-----------------------------
-----------------------------
-----------------------------
-----------------------------
Attention:
Telecopy:
with a copy to:
28
-----------------------------
-----------------------------
-----------------------------
-----------------------------
Attention:
Telecopy:
and
Shearman & Sterling
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
In case the Company shall fail to maintain such office or
agency or shall fall to give such notice of the location or of any change in the
location thereof, presentations may be made and notices and demands may be
served at the principal office of the Warrant Agent.
Any notice pursuant to this Agreement to be given by the
Company or by the Holder(s) of any Warrant Certificate to the Warrant Agent
shall be sufficiently given or made (i) five business days after deposited in
the mail, first-class or registered, postage prepaid, (ii) one business day
after being timely delivered to a next-day air courier or (ii) when receipt is
acknowledged by the addressee, if telecopied, addressed (until another address
is filed in writing by the Warrant Agent with the Company) to the Warrant Agent
as follows:
[▇▇▇▇▇ ▇▇▇▇▇▇]
[Address]
Attention:
Telecopy: [ ]
6.3 Supplements and Amendments. 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 making 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; provided, however, that such action shall
not affect adversely the rights of the Holders. Any amendment or supplement to
this Agreement that has or would have an adverse effect on the interests of the
Holders shall require the written consent of the Holders of a majority of the
outstanding Warrants. The consent of each holder of Warrants affected shall be
required for any amendment pursuant to which the Exercise Price would be
increased or the number of shares of Common Stock purchasable upon exercise of
Warrants would be decreased (other than pursuant to adjustments provided herein)
or the exercise period with respect to the Warrants would be shortened. 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 Affiliate of the Company shall be disregarded and deemed not to be
outstanding, except that, for the purpose of determining whether the Warrant
29
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.
6.4 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.
6.5 Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Warrant Agent shall bind
and inure to the benefit of their respective successors and assigns hereunder.
6.6 Termination. This Agreement (other than the Company's
obligations with respect to Warrants previously exercised) shall terminate at
5:00 p.m., New York City time on the Expiration Date.
6.7 Governing Law. This Warrant Agreement and the Warrants
shall be governed by and construed in accordance with the internal laws of the
State of New York.
6.8 Submission to Jurisdiction; Appointment of Agent for
Service; Waiver. To the fullest extent permitted by applicable law, the Company
irrevocably submits to the non-exclusive jurisdiction of any federal or state
court in the Borough of Manhattan in the City of ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ of America, in any suit or proceeding based on or
arising under this Warrant Agreement and the Warrants, and irrevocably agrees
that all claims in respect of such suit or proceeding may be determined in any
such court. The Company, to the fullest extent permitted by applicable law,
irrevocably and fully waives the defense of an inconvenient forum to the
maintenance of such suit or proceeding and hereby irrevocably designates and
appoints CT Corporation (the "Authorized Agent"), as its authorized agent upon
whom process may be served in any such suit or proceeding. The Company
represents that it has notified the Authorized Agent of such designation and
appointment and that the Authorized Agent has accepted the same in writing. The
Company hereby irrevocably authorizes and directs its Authorized Agent to accept
such service. The Company further agrees that service of process upon its
Authorized Agent and written notice of said service to the Company mailed by
first class mail or delivered to its Authorized Agent shall be deemed in every
respect effective service of process upon the Company in any such suit or
proceeding. Nothing herein shall affect the right of any person to serve process
in any other manner permitted by law. The Company agrees that a final action in
any suit or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other lawful manner.
The Company hereby irrevocably waives, to the extent permitted
by law, any immunity to jurisdiction to which it may otherwise be entitled
(including, without limitation, immunity to pre-judgment attachment,
post-judgment attachment and execution) in any legal suit, action or proceeding
against it arising out of or based on this Warrant Agreement, the Warrant
Certificates or the transactions contemplated hereby.
30
The provisions of this Section 7.8 are intended to be
effective upon the execution of this Warrant Agreement and the Warrant
Certificates without any further action by the Company or the Warrant Agent and
the introduction of a true copy of this Warrant Agreement into evidence shall be
conclusive and final evidence as to such matters.
6.9 Benefits of This Agreement. (a) Nothing in this Agreement
shall be construed to give to any Person or corporation other than the Company,
the Warrant Agent and the holders of the Warrant Certificates any legal or
equitable right, remedy or claim under this Agreement; but this Agreement shall
be for the sole and exclusive benefit of the Company, the Warrant Agent and the
holders of the Warrant Certificates.
(b) Prior to the exercise of the Warrants, no Holder of a
Warrant Certificate, as such, shall be entitled to any rights of a stockholder
of the Company, including, without limitation, the right to receive dividends or
subscription rights, the right to vote, to consent, to exercise any preemptive
right, to receive any notice of meetings of stockholders for the election of
directors of the Company, to share in the assets of the Company in the event of
the liquidation, dissolution or winding up of the Company's affairs or any other
matter or to receive any notice of any proceedings of the Company, except as may
be specifically provided for herein.
(c) All rights of action in respect of this Agreement are
vested in the Holders of the Warrants, and any Holder of any Warrant, without
the consent of the Warrant Agent or the Holder of any other Warrant, may, on
such Holder's own behalf and for such Holder's own benefit, enforce, and may
institute and maintain any suit, action or proceeding against the Company
suitable to enforce, or otherwise in respect of, such Holder's rights hereunder,
including the right to exercise, exchange or surrender for purchase such
Holder's Warrants in the manner provided in this Agreement.
6.10 Counterparts. This Agreement may be executed in any
number of counterparts and each of such counterparts for all purposes be deemed
to be an original, and all such counterparts shall together constitute but one
and the same instrument.
6.11 Table of Contents. The table of contents and headings of
the 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 and provisions hereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed, as of the day and year first above written.
PATHMARK STORES, INC.
By:
----------------------
Name:
Title:
[▇▇▇▇▇ ▇▇▇▇▇▇], as Warrant Agent
By:
------------------------------
Name:
Title:
EXHIBIT A TO
WARRANT AGREEMENT
[FORM OF FACE OF GLOBAL WARRANT CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY ("DTC") TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER REPRESENTATIVE OF
DTC AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE 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
CEDE & CO. 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 SECTIONS 2.9 AND 2.10 OF THE
WARRANT AGREEMENT.
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE OR
OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS THE
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF (1)
REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING
THIS SECURITY IN AN "OFFSHORE TRANSACTION" PURSUANT TO RULE 904 OF REGULATION S,
(2) AGREES THAT IT WILL NOT PRIOR TO (X) THE DATE WHICH IS TWO YEARS (OR SUCH
SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k) UNDER THE SECURITIES ACT OR
ANY SUCCESSOR PROVISION THEREUNDER) AFTER THE LATER OF THE ORIGINAL ISSUE DATE
HEREOF (OR OF ANY PREDECESSOR OF THIS SECURITY) OR THE LAST DAY ON WHICH THE
COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY
PREDECESSOR OF THIS SECURITY) AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE
REQUIRED BY APPLICABLE LAWS (THE "RESALE RESTRICTION TERMINATION DATE"), OFFER,
SELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT (A) TO THE COMPANY, (B) PURSUANT
TO A
2
REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE
144A, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN
THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS
AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE
MEANING OF REGULATION S UNDER THE SECURITIES ACT OR (E) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND
(3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED
A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND; PROVIDED THAT THE COMPANY
AND THE WARRANT AGENT SHALL HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR
TRANSFER (I) PURSUANT TO CLAUSE (D) OR (E) TO REQUIRE THE DELIVERY OF AN OPINION
OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM,
AND (II) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATION OR
TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS SECURITY IS COMPLETED
AND DELIVERED BY THE TRANSFEROR TO THE WARRANT AGENT. THIS LEGEND WILL BE
REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION
DATE. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND
"U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE
SECURITIES ACT.
CUSIP No.
------------------
No. Warrants
--------- -----
WARRANT CERTIFICATE
PATHMARK STORES, INC.
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 dated as of __________, 2000 (the "Warrant Agreement"). between the
Company and [▇▇▇▇▇ ▇▇▇▇▇▇], as Warrant Agent (the "Warrant Agent", which term
includes any successor Warrant Agent under the Warrant Agreement), to purchase
from Pathmark Stores, Inc., a company organized under the laws of Delaware (the
"Company"), _____ Warrant Shares per Warrant at the exercise price of $[22.31]
per share (the "Exercise Price"), or by Cashless Exercise. This Warrant 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. This Warrant Certificate shall
terminate and become void as of 5:00 p.m. on ________, 2010 (the "Expiration
Date") or upon the exercise hereof as to all the shares of Common Stock subject
hereto. The Exercise Price and the number of Warrant Shares purchasable upon
exercise of the Warrants shall be subject to adjustment from time to time as set
forth in the Warrant Agreement.
Reference is hereby made to the further provisions of this
Warrant Certificate set forth on the reverse hereof and such further provisions
shall for all purposes have the same effect as though fully set forth at this
place.
This Warrant Certificate shall not be valid unless
countersigned by the Warrant Agent, as such term is used in the Warrant
Agreement.
The internal laws of the State of New York shall govern the
Warrant Agreement and the Warrants without regard to conflict of law provisions
thereof.
2
IN WITNESS WHEREOF, Pathmark Stores, Inc. has caused this
Warrant Certificate to be executed on behalf of the Company by two Officers of
the Company.
Dated: _____________, 2000
PATHMARK STORES, INC.
By:
-----------------------------
Name:
Title:
By:
-----------------------------
Name:
Title:
3
Countersigned:
[▇▇▇▇▇ ▇▇▇▇▇▇,]
as Warrant Agent
By
---------------------------
Authorized Signatory
[FORM OF REVERSE OF WARRANT CERTIFICATE]
This Warrant Certificate is issued under and in accordance
with 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
[▇▇▇▇▇ ▇▇▇▇▇▇], ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, __.
Warrants may be exercised at any time commencing at the
opening of business on the Exercisability Date and until 5:00 p.m. New York City
time on the Expiration Date. Subject to the terms of the Warrant Agreement, the
Warrants may be exercised in whole or in part (i) by surrender of this Warrant
Certificate with the form of election to purchase Warrant Shares attached hereto
duly executed and with the simultaneous payment of the Exercise Price in cash 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 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. Payment by Cashless Exercise shall be made by the surrender of
a Warrant or Warrants represented by one or more Warrant Certificates and
without payment of the Exercise Price in cash, in exchange for the issuance of
such number of shares of Common Stock equal to the product of (1) the number of
shares of Common Stock for which such Warrant would otherwise then be nominally
exercised if payment of the Exercise Price were being made in cash and (2) the
Cashless Exercise Ratio.
The Warrant Agreement provides that upon the occurrence of
certain events the Exercise Price and the number of shares of Common Stock
issuable upon the exercise of each Warrant shall, subject to certain conditions,
be adjusted.
In the event the Company enters into a Combination following
which this Warrant remains outstanding, the Holder hereof will be entitled to
receive upon exercise of the Warrants the shares of capital stock or other
securities or other property of such surviving entity as such Holder would have
been entitled to receive upon or as the result of such Combination 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 shares of 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
distributions on an equal basis with the holders of shares of Common Stock or
other securities issuable upon exercise of the Warrants, as if the Warrants had
been exercised immediately prior to such events, less the Exercise Price.
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 3.6 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 in
respect of the Warrant Shares as to which the Warrants shall not have been
exercised. This Warrant Certificate may be exchanged at the office
2
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. In the event any fractional
Warrant Shares would have to be issued upon the exercise of the Warrants, the
Company may, at its option, pay an amount in cash equal to the Current Market
Value for one Warrant Share on the Business Day immediately preceding the date
the Warrant is exercised, multiplied by such fraction, computed to the nearest
whole Dutch guilder in lieu of issuing such fractional share.
Pursuant to the Warrant Agreement, the Company has certain
registration obligations with respect to the shares of Common Stock issuable
upon exercise of the Warrants.
Pursuant to the Warrant Agreement, if the Company proposes to
effect an Initial Public Offering, it shall be obligated to include the Warrant
Shares of holders who request to have such Warrant Shares included; provided,
however, that the Managing Underwriter may, under certain conditions, limit the
number of such Warrant Shares to be included in the Initial Public Offering.
Pursuant to the Warrant Agreement, in the event that an
Initial Public Offering has not occurred by the Triggering Date, the Company
will be required to make an offer to purchase all outstanding Warrants in cash
at the Repurchase Price.
Pursuant to the Warrant Agreement, under certain circumstances
in the event of a Change of Control, the Company shall make an offer to purchase
any and all of the outstanding Warrants at cash purchase prices at least equal
to the Repurchase Price. In addition, in the event of a sale of the Company, the
Company has the power to require holders of the Warrants to sell such Warrants
to the transferee.
The Warrants do not entitle any holder hereof to any of the
rights of a stockholder of the Company. 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 nonassessable.
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.
This Warrant Certificate shall not be valid or obligatory for
any purpose until it shall have been countersigned by the Warrant Agent.
FORM OF ELECTION TO PURCHASE WARRANT SHARES
(to be executed only upon exercise of Warrants)
[ ]
The undersigned hereby irrevocably elects to exercise
_____________ Warrants at an exercise price per Warrant Share of $_________ to
acquire an equal number of Warrant Shares 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
___________________, and directs that the shares of 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:
---------------, ----
1
--------------------------------
(Signature of Owner)
--------------------------------
(Street Address)
--------------------------------
(City) (State) (Zip Code)
Signature Guaranteed by:
--------------------------------
--------
1 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.
2
Securities and/or check to be issued to:
Please insert social security or identifying number:
Name:
Street Address:
City, State and Zip Code:
Any unexercised Warrants evidenced by the within Warrant Certificate to be
issued to:
Please insert social security or identifying number:
Name:
Street Address:
City, State and Zip Code:
SCHEDULE A
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL WARRANTS
The following increases or decreases in this Global Warrant have been
made:
Date of Exchange Amount of decrease Amount of increase in Number of Warrants Signature of
in Number of Number of Warrants of of this Global authorized officer
Warrants of this this Global Warrant Warrant following of Warrant Agent
Global Warrant such decrease or
increase
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
EXHIBIT B TO
WARRANT AGREEMENT
[FORM OF FACE OF DEFINITIVE WARRANT CERTIFICATE]
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE OR
OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS THE
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF (1)
REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING
THIS SECURITY IN AN "OFFSHORE TRANSACTION" PURSUANT TO RULE 904 OF REGULATION S,
(2) AGREES THAT IT WILL NOT PRIOR TO (X) THE DATE WHICH IS TWO YEARS (OR SUCH
SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k) UNDER THE SECURITIES ACT OR
ANY SUCCESSOR PROVISION THEREUNDER) AFTER THE LATER OF THE ORIGINAL ISSUE DATE
HEREOF (OR OF ANY PREDECESSOR OF THIS SECURITY) OR THE LAST DAY ON WHICH THE
COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY
PREDECESSOR OF THIS SECURITY) AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE
REQUIRED BY APPLICABLE LAWS (THE "RESALE RESTRICTION TERMINATION DATE"), OFFER,
SELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT (A) TO THE COMPANY, (B) PURSUANT
TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE
PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR
OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE
SECURITIES ACT OR (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT IT WILL GIVE
TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO
THE EFFECT OF THIS LEGEND; PROVIDED THAT THE COMPANY AND THE WARRANT AGENT SHALL
HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (I) PURSUANT TO CLAUSE
(D) OR (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION
AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (II) IN EACH OF THE
FOREGOING CASES, TO REQUIRE THAT A CERTIFICATION OR TRANSFER IN THE FORM
APPEARING ON THE OTHER SIDE OF THIS SECURITY IS COMPLETED AND DELIVERED BY THE
TRANSFEROR TO THE
2
WARRANT AGENT, THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER
THE RESALE RESTRICTION TERMINATION DATE. AS USED HEREIN, THE TERMS "OFFSHORE
TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM
BY REGULATION S UNDER THE SECURITIES ACT.