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EXHIBIT 4(c)
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NEW VALLEY CORPORATION
AND
AMERICAN STOCK TRANSFER & TRUST COMPANY,
Warrant Agent
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[FORM OF]
WARRANT AGREEMENT
Dated as of __________, 1999
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TABLE OF CONTENTS*
PAGE
Section 1. Appointment of Warrant Agent...............................................................1
Section 2. Warrant Certificates.......................................................................1
Section 3. Execution and Countersignature of Warrant Certificates.....................................2
Section 4. Warrants and Issuance of Warrant Certificates..............................................2
Section 5. Registration; Transfers and Exchanges......................................................2
Section 6. Duration and Exercise of Warrants; Redemption of Warrants; Exercise Price; Right
of Warrant Holders.........................................................................3
Section 7. Optional Reduction of Exercise Price.......................................................5
Section 8. Payment of Taxes...........................................................................5
Section 9. Mutilated or Missing Warrant Certificates..................................................6
Section 10. Reservation of Shares......................................................................6
Section 11. Obtaining of Governmental Approvals and Stock Exchange Listings............................6
Section 12. Adjustment of Exercise Price and Number of Warrant Shares Purchasable......................7
Section 13. Fractional Shares.........................................................................10
Section 14. Notices to Warrant Holders................................................................10
Section 15. Merger, Consolidation or Change of Name of Warrant Agent..................................12
Section 16. Warrant Agent.............................................................................12
Section 17. Change of Warrant Agent...................................................................14
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* This Table of Contents does not constitute a part of this
Agreement or have any bearing upon the interpretation of any of its terms or
provisions.
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Section 18. Issuance of New Warrant Certificates......................................................15
Section 19. Notices to Company and Warrant Agent......................................................15
Section 20. Identity of Transfer Agent................................................................16
Section 21. Supplements and Amendments................................................................16
Section 22. Successors................................................................................16
Section 23. Termination...............................................................................16
Section 24. Governing Law.............................................................................17
Section 25. Benefits of This Agreement................................................................17
Section 26. Counterparts..............................................................................17
EXHIBIT A. Form of Warrant Certificate
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WARRANT AGREEMENT dated as of _________, 1999, between New
Valley Corporation, a Delaware corporation (the "COMPANY") and American Stock
Transfer & Trust Company, a New York limited purpose trust company (the "WARRANT
AGENT").
WHEREAS, the Company proposes to effect a plan of
recapitalization whereby, among other things, each issued and outstanding $15.00
Class A Increasing Rate Cumulative Senior Preferred Share, par value $.01 per
share (the "CLASS A SENIOR PREFERRED SHARES"), $3.00 Class B Cumulative
Convertible Preferred Share, par value $.10 per share (the "CLASS B PREFERRED
SHARES"), and Common Share, par value $.01 per share (the "COMMON SHARES"), is
to be reclassified and changed into a number of Common Shares and a number of
warrants (the "Warrants"), each Warrant entitling the holder thereof to purchase
one Common Share of the Company (the Common Shares issuable upon exercise of the
Warrants being referred to herein as the "WARRANT SHARES");
WHEREAS, pursuant to the plan of recapitalization, each Class
A Senior Preferred Share is to be changed into 20 Common Shares and one Warrant,
each Class B Preferred Share shall be changed into 1/3 of a Common Share and
3/10 of a Warrant, and each Common Share is to be changed into 1/10 of a Common
Share and 3/10 of a Warrant; and
WHEREAS, the Company desires the Warrant Agent to act on
behalf of the Company, and the Warrant Agent is willing to act, in connection
with the issuance of certificates evidencing the Warrants (the "WARRANT
CERTIFICATES") and other matters as provided herein;
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein set forth, the parties hereto agree as follows:
SECTION 1. APPOINTMENT OF WARRANT AGENT. The Company hereby
appoints the Warrant Agent to act as agent for the Company in accordance with
the instructions set forth hereinafter in this Agreement, and the Warrant Agent
hereby accepts such appointment. So long as any of the Warrant Certificates are
outstanding, there may be an authenticating agent appointed by the Warrant Agent
which shall be authorized to act on behalf of the Warrant Agent to countersign
Warrant Certificates issued upon exchange and register of transfer thereof, and
Warrant Certificates so countersigned shall be entitled to the benefits of this
Warrant Agreement and shall be valid for all purposes as if countersigned by the
Warrant Agent hereunder. Whenever reference is made in this Warrant Agreement to
the countersignature of the Warrant Agent, such reference shall be deemed to
include countersignature on behalf of the Warrant Agent by such agent. The agent
appointed hereunder shall be entitled to the same rights, privileges and
indemnities as the Warrant Agent under SECTION 16 and shall satisfy such
requirements as are applicable to a successor to the Warrant Agent under SECTION
17. The Warrant Agent has initially appointed ______________________ as
authenticating agent.
SECTION 2. WARRANT CERTIFICATES. The Warrants shall be
evidenced by Warrant Certificates. The text of each Warrant Certificate (and the
Forms of Exercise and Assignment to be set forth on the reverse thereof) shall
be substantially in the form set forth in EXHIBIT A attached hereto and may have
such identification, designation and information thereon as the Company may deem
appropriate and as are not inconsistent with the provisions of this Agreement,
or as may be required to comply with any applicable law or with any rule or
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regulation under such law or with any rule or regulation of the National
Association of Securities Dealers, Inc. or any stock exchange on which the
Warrants may be listed, or to conform to usage.
SECTION 3. EXECUTION AND COUNTERSIGNATURE OF WARRANT
CERTIFICATES. The Warrant Certificates shall be executed on behalf of the
Company by its Chairman of the Board, President or one of its Vice Presidents,
under its corporate seal reproduced thereon attested by its Secretary or one of
its Assistant Secretaries. The signature of any such officer on any Warrant
Certificate may be manual or facsimile. Warrant Certificates bearing the manual
or facsimile signatures of individuals who were at any time the proper officers
of the Company shall bind the Company notwithstanding that such individuals, or
any of them, ceased to be such officers prior to the countersignature and
delivery of such Warrant Certificate or were not such officers at the date of
this Agreement.
Each Warrant Certificate shall be countersigned by the manual
signature of an authorized officer of the Warrant Agent and shall not be valid
for any purpose unless so countersigned. The Warrant Agent is hereby authorized
to countersign Warrant Certificates for issuance pursuant to any provision of
this Agreement.
Each Warrant Certificate shall be dated the date of its
countersignature by the Warrant Agent.
SECTION 4. WARRANTS AND ISSUANCE OF WARRANT CERTIFICATES.
Following the execution of this Agreement, Warrant Certificates representing
17,898,629 Warrants shall be countersigned, issued and delivered by the Warrant
Agent upon written order of the Company signed by its Chairman of the Board, its
President, one of its Vice Presidents, its Treasurer, its Secretary or one of
its Assistant Secretaries.
From time to time, the Warrant Agent shall countersign and
deliver Warrant Certificates in required denominations to the persons entitled
thereto in connection with any transfer or exchange permitted under this
Agreement. Except as provided in SECTION 9 hereof, no Warrant Certificates shall
be issued except (i) Warrant Certificates initially issued hereunder for the
number of Warrant Shares equal to the number of Warrants represented thereby,
(ii) Warrant Certificates issued upon the partial exercise of any Warrant to
evidence the portion of such Warrant not exercised and (iii) Warrant
Certificates issued upon any transfer or exchange of Warrants.
The Warrants will be separately transferable upon issuance.
SECTION 5. REGISTRATION; TRANSFERS AND EXCHANGES. The Company
shall maintain at the principal office of the Warrant Agent at ___________ a
register for the registration of the Warrant Certificates and of their transfer
from time to time (the "WARRANT REGISTER").
The Company and the Warrant Agent may deem and treat the
registered holder of each Warrant Certificate as the absolute owner thereof
(notwithstanding any notation of ownership or other writing thereon made by
anyone), for the purpose of any exercise thereof, any distribution to the holder
thereof, and for all other purposes, and neither the Company nor the Warrant
Agent shall be affected by any notice to the contrary.
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Each Warrant Certificate shall be transferable, in whole or in
part, on the Warrant Register, upon surrender of the Warrant Certificate to the
Company at the principal office of the Warrant Agent in ______________, or at
another office or agency to be maintained by the Company, together with a
written assignment of the Warrant Certificate on the Form of Assignment set
forth on the reverse thereof or in other form satisfactory to the Warrant Agent,
duly executed by the registered holder thereof or his duly appointed legal
representative, and together with funds to pay any transfer taxes payable in
connection with such transfer. Upon such surrender and payment, a new Warrant
Certificate, in the name of the assignee and in the denomination or
denominations specified in such instrument of assignment, shall be issued and
delivered. If less than all of the Warrant Certificate is being transferred, a
new Warrant Certificate or Certificates shall be issued for the portion of the
Warrant Certificate not being transferred. The Warrant Certificate surrendered
shall be cancelled by the Warrant Agent.
A Warrant Certificate may be divided or combined with other
Warrant Certificates upon surrender thereof to the Company at the principal
office of the Warrant Agent as set forth above, or at another office or agency
to be maintained by the Company, together with a written notice specifying the
names and denominations in which new Warrant Certificates are to be issued,
signed by the registered holder thereof or his duly appointed legal
representative, and together with the funds to pay any transfer taxes payable in
connection with such transfer. Upon such surrender and payment, a new Warrant
Certificate or Certificates shall be issued and delivered in accordance with
such notice. The Warrant Certificate surrendered shall be cancelled by the
Warrant Agent.
The Company shall make no service or other charge in
connection with any such transfer or exchange of Warrant Certificates, except
for any transfer taxes payable in connection therewith.
Warrant Certificates cancelled by the Warrant Agent pursuant
to any provision of this Agreement shall be destroyed by it unless the Company
directs their return to the Company. The Warrant Agent shall furnish to the
Company written confirmation of the destruction of the Warrant Certificates so
cancelled.
SECTION 6. DURATION AND EXERCISE OF WARRANTS; REDEMPTION OF
WARRANTS; EXERCISE PRICE; RIGHT OF WARRANT HOLDERS. (a) The Warrants may be
exercised during the period commencing on the effective date of the Company's
Registration Statement covering the Warrant Shares underlying the Warrants (the
"EFFECTIVE DATE") and terminating five years thereafter, or if such day is a day
on which banking institutions in the State of New York are authorized by law to
close, then on the next succeeding day which shall not be such a day (such date
of expiration being herein referred to as the "EXPIRATION DATE"). If the
Effective Date has not occurred by the date of this Agreement, the Company shall
cause notice of such Expiration Date to be delivered, as soon as reasonably
practicable after such date is established, to the Warrant Agent, in accordance
with SECTION 19, and to the registered holders of Warrant Certificates, in
accordance with SECTION 14. Each Warrant may be exercised on any business day on
or prior to the close of business on the Expiration Date. The Expiration Date
may be extended by the Company in its sole discretion from time to time by a
notice given to the Warrant Agent and mailed to the registered holders of the
Warrant Certificates as provided in SECTION 14. After the close of business on
the Expiration Date, unexercised Warrants will become wholly void and of no
value.
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(b) The Company may elect by written notice given as
hereinafter provided (the "REDEMPTION NOTICE") to redeem the Warrants at a price
of $.01 per Warrant if, at any time after the third anniversary of the effective
time of the plan of recapitalization, the average reported closing price or bid
price of a Common Share, as reported on Nasdaq or the Bulletin Board or by the
National Quotation Bureau or on a national securities exchange, as the case may
be, exceeds $12.50 for any 20 consecutive trading days ending within 5 days
prior to the date of the Redemption Notice (such date of the Redemption Notice
being referred to herein as the "REDEMPTION NOTICE DATE"). The Redemption Notice
shall specify the date of redemption as fixed by the Company (the "REDEMPTION
DATE"), which date shall be not less than 30 days following the Redemption
Notice Date. The Redemption Notice shall also be given to the Warrant Agent as
provided in SECTION 19.
(c) Subject to the provisions of this Agreement, the holder of
each Warrant shall have the right to purchase from the Company (and the Company
shall issue and sell to such holder) one fully paid and nonassessable Warrant
Shares at the exercise price at the time in effect hereunder (the "EXERCISE
PRICE"), upon surrender to the Company at the principal office of the Warrant
Agent of the Warrant Certificate evidencing such Warrant, with the Form of
Exercise on the reverse thereof duly filled in and signed, and upon payment of
the Exercise Price in lawful money of the United States of America by certified
or official bank check payable to the order of the Company. The Exercise Price,
as of the initial issuance of the Warrants, shall be $12.50. The Exercise Price
and the number of Warrant Shares purchasable upon exercise of a Warrant shall be
subject to adjustment as provided in SECTION 12.
Subject to SECTION 8, upon such surrender of a Warrant
Certificate and payment of the Exercise Price at the time in effect hereunder,
the Warrant Agent shall cause to be issued and shall deliver to or upon the
written order of the registered holder of such Warrant Certificate and in such
name or names as such registered holder may designate a certificate for the
Warrant Share or Warrant Shares issuable upon the exercise of the Warrant or
Warrants evidenced by such Warrant Certificate. Such certificate shall be deemed
to have been issued and any person so designated to be named therein shall be
deemed to have become the holder of record of such Warrant Share or Warrant
Shares as of the date of the surrender of such Warrant Certificate and payment
of the Exercise Price.
The Warrants evidenced by a Warrant Certificate shall be
exercisable, at the election of the registered holder thereof, either as an
entirety or from time to time for part only of the number of Warrants evidenced
by the Warrant Certificate. In the event that less than all of the Warrants
evidenced by a Warrant Certificate surrendered upon the exercise of Warrants are
exercised, a new Warrant Certificate or Certificates shall be issued for the
remaining number of Warrants evidenced by the Warrant Certificate so
surrendered. All Warrant Certificates surrendered upon exercise of Warrants
shall be cancelled by the Warrant Agent.
The Warrant Agent shall deposit to the account of the Company
all monies received by the Warrant Agent in payment of the Exercise Price of any
Warrant. The Warrant Agent shall account promptly to the Company with respect to
the exercise of Warrants.
(d) No Warrant holder, as such, shall be entitled to vote or
to receive dividends or shall otherwise be deemed to be the holder of Common
Shares for any purpose, nor shall
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anything contained herein or in any Warrant Certificate be construed to confer
upon any Warrant holder, as such, any of the rights of a stockholder of the
Company or any right to vote upon or give or withhold consent to any action of
the Company (whether upon any reorganization, issuance of securities,
reclassification or conversion of Common Shares, consolidation, merger, sale,
lease, conveyance, or otherwise), receive notice of meetings or other action
affecting stockholders (except for notices expressly provided for in this
Agreement) or receive dividends or subscription rights, until such Warrant
Certificate shall have been surrendered for exercise accompanied by full and
proper payment of the Exercise Price as provided in this Agreement and the
Warrant Shares thereunder shall have become issuable and until such person shall
have been deemed to have become a holder of record of such Warrant Shares. If on
the date of surrender of such Warrant Certificate and payment of such Exercise
Price, the transfer books for the Warrant Shares shall be closed, certificates
for the Warrant Shares shall be issuable on the date on which such books shall
next be open (whether before, on, or after the Expiration Date) and until such
date the Company shall be under no duty to deliver any certificate for such
Warrant Shares. No holder of Warrants shall, upon the exercise of Warrants, be
entitled to any dividends if the record date with respect to payment of such
dividends shall be a date prior to the date such Warrant Shares became issuable
upon the exercise of such Warrants.
SECTION 7. OPTIONAL REDUCTION OF EXERCISE PRICE. The Company
shall have the right, at any time, voluntarily to reduce the then current
Exercise Price to such amount (the "REDUCED EXERCISE PRICE") and for such period
or periods of time which may be through the close of business on the Expiration
Date (the "REDUCED EXERCISE PRICE PERIOD") as may be deemed appropriate by the
Board of Directors of the Company. Notice of any such Reduced Exercise Price and
Reduced Exercise Price Period shall be given to the registered holders of
Warrants in the manner provided in SECTION 14 and to the Warrant Agent in the
manner provided in SECTION 19. After the termination of the Reduced Exercise
Price Period, the Exercise Price shall be such Exercise Price which would have
been in effect, as adjusted pursuant to SECTION 12, had there been no reduction
in the Exercise Price pursuant to the provisions of this SECTION 7. Any
adjustment in the Exercise Price pursuant to SECTION 12 during the Reduced
Exercise Price Period shall also be made in the Reduced Exercise Price in the
manner specified in SECTION 12.
SECTION 8. PAYMENT OF TAXES. The Company shall pay all taxes,
if any, attributable to the initial issuance of the Warrant Certificates;
PROVIDED, HOWEVER, that the Company shall not be required to pay any tax or
taxes which may be payable in respect of any transfer of the Warrants after
their initial issuance or with respect to the exercise thereof and the Company
shall not be required to issue or deliver such certificates unless or until the
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 9. MUTILATED OR MISSING WARRANT CERTIFICATES. In case
any of the Warrant Certificates shall be mutilated, lost, stolen or destroyed,
the Company may in its discretion issue, and the Warrant Agent may countersign,
in exchange and substitution for and upon cancellation of the mutilated Warrant
Certificate, and in lieu of and in substitution for the Warrant Certificate
lost, stolen or destroyed, a new Warrant Certificate of like tenor and
representing an equivalent number of Warrants, but only upon receipt of evidence
satisfactory to the Company and the Warrant Agent of such loss, theft or
destruction of such Warrant Certificate and indemnity or bond, if requested,
also satisfactory to them. Applicants for such substitute
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Warrant Certificates shall also comply with such other reasonable regulations
and pay such other reasonable charges as the Company or the Warrant Agent may
prescribe.
SECTION 10. RESERVATION OF SHARES. The Company will at all
times reserve and keep available, free from preemptive rights, out of the
aggregate of its authorized but unissued Common Shares or its authorized and
issued Common Shares held in its treasury, for the purpose of enabling it to
satisfy any obligation to issue Warrant Shares upon exercise of Warrants, the
full number of Warrant Shares deliverable upon the exercise of all outstanding
Warrants.
Before taking any action which would cause an adjustment
pursuant to SECTION 12 reducing the Exercise Price below the then par value (if
any) of the Warrant Shares issuable upon exercise of the Warrants, the Company
will take any action which may, in the opinion of its counsel (which may be
counsel employed by the Company), be necessary in order that the Company may
validly and legally issue fully paid and nonassessable Warrant Shares at the
Exercise Price as so adjusted.
The Company covenants that all Warrant Shares which may be
issued upon the exercise of Warrants will, upon issuance, be fully paid and
nonassessable and free from all taxes, liens, charges and security interests
with respect to the issue thereof.
The Warrant Agent is authorized to make requisition from time
to time from a transfer agent for the Common Shares (including the Company if
then acting as a transfer agent) stock certificates required to honor exercises
of outstanding Warrants. The Company hereby authorizes its present and any
future such transfer agent to comply with all such requests. The Company will
supply such transfer agent with duly executed stock certificates for such
purpose and will itself provide or otherwise make available any cash which may
be payable as provided in SECTION 13 of this Agreement.
SECTION 11. OBTAINING OF GOVERNMENTAL APPROVALS AND STOCK
EXCHANGE LISTINGS. The Company will in good faith and as expeditiously as
possible take all action which may be necessary to obtain and keep effective any
and all permits, consents and approvals of governmental agencies and
authorities, and will make any and all filings under Federal and State
securities laws, necessary in connection with the issuance, distribution and
transfer of Warrant Certificates, the exercise of the Warrants, and the
issuance, sale, transfer and delivery of Shares upon exercise of the Warrants.
The Company will use its best efforts to have the Warrant Shares which are
issuable upon the exercise of the Warrants quoted on any securities exchanges on
which the then outstanding Common Shares are listed.
SECTION 12. ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF WARRANT
SHARES PURCHASABLE. The Exercise Price and the number of Warrant Shares
purchasable upon the exercise of each Warrant are subject to adjustment from
time to time as provided in this SECTION 12.
(a) In the event the Company shall at any time after the date
of this Agreement issue any Common Shares as a stock dividend to the holders of
Common Shares, subdivide, combine or reclassify the outstanding Common Shares
into a greater or lesser number of Common Shares (any such sale, issuance,
subdivision or combination being herein called a
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"CHANGE OF SHARES"), then, and thereafter upon any future Change of Shares, the
Exercise Price in effect immediately prior to such Change of Shares shall be
changed to a price (including any applicable fraction of a cent) determined by
multiplying the Exercise Price in effect immediately prior to the Change of
Shares by a fraction, the numerator of which shall be the number of Common
Shares outstanding immediately prior to the Change of Shares, and the
denominator of which shall be the sum of the number of Common Shares outstanding
immediately following the Change of Shares. Such adjustment shall be made
successively whenever such an issuance is made.
(b) The Company may elect, upon any adjustment of the Exercise
Price hereunder, to adjust the number of Warrants outstanding in lieu of the
adjustment in the number of Warrant Shares purchasable upon the exercise of each
Warrant as hereinabove provided (the "WARRANT ADJUSTMENT"). Following a Warrant
Adjustment, each Warrant outstanding after such adjustment shall continue to
represent the right to purchase one Common Share. Each Warrant held of record
prior to such adjustment of the number of Warrants shall become that number of
Warrants (calculated to the nearest tenth) determined by multiplying the number
one by a fraction, the numerator of which shall be the Exercise Price in effect
immediately prior to such adjustment and the denominator of which shall be the
Exercise Price in effect immediately following the Warrant Adjustment. Upon each
Warrant Adjustment, the Company shall, as promptly as practicable, cause to be
distributed to each registered holder of Warrant Certificates on the date of
such Warrant Adjustment Warrant Certificates evidencing, subject to SECTION 13
hereof, the number of additional Warrants to which such holder shall be entitled
as a result of such adjustment or, at the option of the Company, cause to be
distributed to such holder in substitution and replacement for the Warrant
Certificates held by such holder prior to the date of the Warrant Adjustment
(and upon surrender thereof, if required by the Company) new Warrant
Certificates evidencing the number of Warrants to which such holder shall be
entitled after such adjustment.
(c) In the event the Company shall pay cash dividends or
distributions in cash on all Common Shares, the Exercise Price for the Warrants
in effect on the record date of the dividend payment shall be reduced by the
amount of the cash dividend the Warrant holder would have been entitled to
receive had such holder exercised its Warrants immediately prior to such date.
The foregoing adjustment shall be made successively immediately following any
cash dividend payment.
(d) In case the Company shall issue rights, options or
warrants to all holders of Common Shares entitling them (for a period expiring
within 45 calendar days after the date of issuance) to subscribe for or purchase
Common Shares (or securities exchangeable for or convertible into Common Shares)
at a price per Common Share (or having an exchange value or a conversion price
per Common Share, if a security exchangeable for or convertible into Common
Shares) less than the current market price per Common Share (as defined in
SECTION 12(J)), on the record date mentioned below, the Exercise Price to be in
effect after such record date shall be determined by multiplying the Exercise
Price in effect immediately prior to the record date by a fraction, the
numerator of which shall be the number of Common Shares outstanding on the
record date plus the number of Common Shares which the aggregate offering price
of the total number of Common Shares so to be offered (or the aggregate initial
exchange value or conversion price of the exchangeable or convertible securities
so to be offered) would
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purchase at the current market price and the denominator of which shall be the
number of Common Shares outstanding on the record date plus the number of
additional Common Shares to be offered for subscription or purchase (or for
which or into which the exchangeable or convertible securities so to be offered
are initially exchangeable or convertible). In case such subscription price may
be paid in a consideration part or all of which shall be in a form other than
cash, the value of that consideration shall be as determined by the Board of
Directors of the Company. Common Shares owned by or held for the account of the
Company shall not be deemed outstanding for the purpose of that computation. The
foregoing adjustment shall be effective as of immediately following the record
date and shall be made successively whenever a record date is fixed. In the
event that such rights, options or warrants are not so issued, the Exercise
Price shall again be adjusted to be the Exercise Price that would then be in
effect if such record date had not been fixed, but such subsequent adjustment
shall not affect the number of shares issued upon any exercise of Warrants prior
to the date such subsequent adjustment is made. On the termination of any right
to convert or exchange securities convertible into Common Shares, the Exercise
Price shall be immediately readjusted to such amount as would have obtained had
the adjustment made upon the granting or issuance of such rights, options or
warrants been made upon the basis of the issuance or sale of only the number of
Common Shares actually issued pursuant to such rights, options or warrants.
(e) In the event the Company shall fix a record date for the
making of a distribution to all holders of Common Shares (including any such
distribution made in connection with a consolidation or merger in which the
Company is the continuing corporation) of evidences of indebtedness or assets
(other than cash dividends or cash distributions) each holder of Warrants shall
be entitled to participate in such distribution upon the exercise of such
holder's Warrants on a basis that the Company determines in its good faith
discretion to be fair and appropriate.
(f) Upon each adjustment of the Exercise Price pursuant to
this SECTION 12, other than an adjustment pursuant to paragraph (c) hereof, the
total number of Common Shares purchasable upon the exercise of each Warrant
shall (subject to the provisions contained in paragraph (b) hereof) be such
number of shares (calculated to the nearest hundredth) purchasable at the
Exercise Price in effect immediately prior to such adjustment multiplied by a
fraction, the numerator of which shall be the Exercise Price in effect
immediately prior to such adjustment and the denominator of which shall be the
Exercise Price in effect immediately after such adjustment.
(g) In any case in which this SECTION 12 shall require that
any adjustment in the Exercise Price be made effective as of immediately after a
record date for a specified event, the Company may elect to defer until the
occurrence of the event the issuing to the holder of any Warrant exercised after
that record date the Common Shares and other capital stock of the Company, if
any, issuable upon the exercise over and above the Common Shares and other
capital stock of the Exercise Price in effect prior to such adjustment;
PROVIDED, however, that the Company shall deliver to the holder a due xxxx or
other appropriate instrument evidencing the holder's right to receive such
additional shares upon the occurrence of the event requiring such adjustment.
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(h) In case of any reclassification, capital reorganization
or other change of outstanding Common Shares, or in case of any consolidation or
merger of the Company with or into another corporation (other than a
consolidation or merger in which the Company is the continuing corporation and
which does not result in any reclassification, capital reorganization or other
change of outstanding Common Shares), or in case of any sale or conveyance to
another corporation of the property of the Company as, or substantially as, an
entirety (other than a sale/leaseback, mortgage or other financing transaction),
the Company shall cause effective provision to be made so that each holder of a
Warrant then outstanding shall have the right thereafter, by exercising such
Warrant, to purchase the kind and number of shares of stock or other securities
or property (including cash) receivable upon such reclassification, capital
reorganization or other change, consolidation, merger, sale or conveyance by a
holder of the number of Common Shares that might have been purchased upon
exercise of such Warrant immediately prior to such reclassification, capital
reorganization or other change, consolidation, merger, sale or conveyance. Any
such provision shall include provision for adjustments that shall be as nearly
equivalent as may be practicable to the adjustments provided for in this SECTION
12. The Company shall not effect any such consolidation, merger or sale unless
prior to or simultaneously with the consummation thereof the successor (if other
than the Company) resulting from such consolidation or merger or the corporation
purchasing assets or other appropriate corporation or entity shall assume, by
written instrument executed and delivered to the Warrant Agent, the obligation
to deliver to the holder of each Warrant such shares of stock, securities or
assets as, in accordance with the foregoing provisions, such holders may be
entitled to purchase and the other obligations under this Agreement. The
foregoing provisions shall similarly apply to successive reclassifications,
capital reorganizations and other changes of outstanding Common Shares and to
successive consolidations, mergers, sales or conveyances.
(i) For the purposes of adjustments required by paragraph (d)
above, the Common Shares (or securities exchangeable for or convertible into
Common Shares) which the holder of any rights, options, or warrants shall be
entitled to subscribe for or purchase shall be deemed to be issued and
outstanding as of the date of sale, issuance or distribution of such securities
and the consideration, if any, received by the Company therefor shall be deemed
to be the consideration received by the Company for such securities, plus the
consideration or premiums stated in such securities to be paid for the Common
Shares (or securities exchangeable for or convertible into Common Shares)
covered thereby.
(j) For the purpose of any computation under paragraph (d)
above, the current market price per Common Share on any date shall be deemed to
be the average of the daily closing prices per Common Share for 15 consecutive
trading days commencing 20 trading days before such date. The closing price for
each day shall be the last sale price regular way or, in case no such sale takes
place on such day, the average of the closing bid and asked prices regular way,
in either case on Nasdaq or the Bulletin Board or by the National Quotation
Bureau or on a national securities exchange, as the case may be.
(k) No adjustment in the Exercise Price shall be required
unless such adjustment would require an increase or decrease of at least 1% in
such price; PROVIDED, HOWEVER, that any adjustments which by reason of this
SECTION 12(k) are not required to be made shall be carried forward and taken
into account in any subsequent adjustment. All calculations under this
9
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SECTION 12 shall be made to the nearest cent or to the nearest one-hundredth of
a share, as the case may be.
(l) For the purpose of this SECTION 12, the term "COMMON
SHARES" or "SHARES OF COMMON SHARES" shall mean (i) the class of stock
designated as the Common Shares of the Company at the date of this Agreement, or
(ii) any other class of stock resulting from successive changes or
reclassification of such shares consisting solely of changes in par value, or
from par value to no par value, or from no par value to par value.
SECTION 13. FRACTIONAL SHARES. The Company shall not be
required to issue fractions of Warrant Shares upon exercise of the Warrants or
to distribute Share Certificates which evidence fractional Warrant Shares. If a
holder of Warrants exercises more than one Warrant at the same time, the Warrant
Shares issuable shall be based on the total number of Warrants to be exercised
at such time. In lieu of fractional Warrant Shares, there shall be paid to the
registered holders of Warrant Certificates at the time such Warrants are
exercised an amount in cash equal to the same fraction of the current market
price of the Warrant Shares as determined pursuant to SECTION 12(j).
SECTION 14. NOTICES TO WARRANT HOLDERS. (a) Except in the case
of an adjustment pursuant to SECTION 7 or SECTION 12(c), whenever the number of
Warrant Shares purchasable upon the exercise of each Warrant or the Exercise
Price is adjusted as provided herein, the Company within 20 days thereafter
shall (i) cause to be filed with the Warrant Agent a certificate of the Company
signed by its Chairman of the Board, its President or one of its Vice Presidents
setting forth the number of Warrant Shares purchasable upon the exercise of each
Warrant and the Exercise Price for such Warrant Shares after adjustment and
setting forth in reasonable detail the method of calculation and the facts upon
which the calculations are based, which certificate shall be conclusive evidence
of the correctness of the matters set forth therein, and (ii) cause notice of
such adjustment to be mailed by first-class mail, postage prepaid, to each
registered holder of a Warrant Certificate at his address appearing on the
Warrant Register. Where appropriate, such notice may be mailed in advance and
included as a part of any notice required to be mailed under any other provision
of this SECTION 14.
(b) Upon the fixing of a date for redemption, as provided in
SECTION 6, the establishing of the Exercise Date, as provided in SECTION 6, or
the fixing of a Reduced Exercise Price and Reduced Exercise Price Period, as
provided in SECTION 7, the Company shall cause notice of such redemption or
Reduced Exercise Price and Reduced Exercise Price Period, as the case may be, to
be mailed by first-class mail, postage prepaid, to each registered holder of a
Warrant Certificate at his address appearing on the Warrant Register.
(c) Upon the declaration of cash dividends or distributions in
cash on all Common Shares, as provided in SECTION 12(C), the Company shall cause
notice of such payment to be given to the Warrant Agent and to each registered
holder of a Warrant Certificate in such manner as the Company determines to be
fair and appropriate, including by public announcement of the declaration of the
dividend or distribution.
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(d) In case:
(i) the Company shall authorize the issuance to all
holders of Common Shares of rights or warrants to subscribe for or
purchase Common Shares or of any other subscription rights or warrants;
or
(ii) the Company shall authorize the distribution to
all holders of Common Shares or shares of its stock (other than Common
Shares) evidences of indebtedness or assets (other than cash dividends
or distributions in cash); or
(iii) of any consolidation or merger to which the
Company is a party and for which approval by holders of Common Shares
is required, or of the conveyance or transfer of the properties and
assets of the Company substantially as an entirety, or of any
reclassification or change of Common Shares (other than a change in par
value, if any, or as a result of a subdivision or combination); or
(iv) of the voluntary or involuntary dissolution,
liquidation or winding up of the Company; or
(v) the Company proposes to take any other action
which would require an adjustment of the Exercise Price pursuant to
SECTION 12;
then the Company shall cause to be filed with the Warrant Agent and shall cause
notice of the proposed action and the record date for the determination of
holders of Common Shares entitled to vote on such matter to be mailed to each of
the registered holders of the Warrant Certificates at his address appearing on
the Warrant Register, at least 20 days (or 10 days in any case specified in
clauses (i) or (ii) above) prior to such record date, by first-class mail,
postage prepaid, which notice shall state (i) the date as of which the holders
of record of Common Shares to be entitled to receive any such rights, warrants
or distribution are to be determined, or (ii) the date on which any such
consolidation, merger, conveyance, transfer, dissolution, liquidation or winding
up is expected to become effective, and the date as of which it is expected that
holders of record of Common Shares shall be entitled to exchange their Common
Shares for securities or other property, if any, deliverable upon such
reclassification, consolidation, merger, conveyance, transfer, dissolution,
liquidation or winding up. The failure to give any notice required by this
SECTION 14(C) or any defect therein shall not affect the legality of any such
reclassification, consolidation, merger, conveyance, transfer, dissolution,
liquidation or winding up, or the vote upon any action.
SECTION 15. MERGER, CONSOLIDATION OR CHANGE OF NAME OF WARRANT
AGENT. Any corporation into which the Warrant Agent may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Warrant Agent shall be a party,
or any corporation succeeding to the corporate trust business of the Warrant
Agent, shall be the successor to the Warrant Agent hereunder without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, provided that such corporation would be eligible for appointment
as a successor Warrant Agent under the provisions of SECTION 17. In case at the
time such successor to the Warrant Agent shall succeed to the agency created by
this Agreement, and in case at that time any of the Warrant
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Certificates shall have been countersigned but not delivered, any such successor
to the Warrant Agent may adopt the countersignature of the original Warrant
Agent; and in case at that time any of the Warrant Certificates shall not have
been countersigned, any successor to the Warrant Agent may countersign such
Warrant Certificates either in the name of the predecessor Warrant Agent or in
the name of the successor Warrant Agent; and in all such cases such Warrant
Certificates shall have the full force provided in the Warrant Certificates and
in this Agreement.
In case at any time the name of the Warrant Agent shall be
changed and at such time the Warrant Certificates shall have been countersigned
but not delivered, the Warrant Agent may adopt the countersignature under its
prior name, and in case at that time any of the Warrant Certificates shall not
have been countersigned, the Warrant Agent may countersign such Warrant
Certificates either in its prior name or in its changed name, and in all such
cases such Warrant Certificates shall have the full force provided in the
Warrant Certificates and in this Agreement.
SECTION 16. WARRANT AGENT. The Warrant Agent undertakes the
duties and obligations imposed on it by this Agreement, upon the following terms
and conditions, all of which the Company and the holders of Warrants, by their
acceptance thereof, shall be bound:
(a) The statements contained herein and in the Warrant
Certificates shall be taken as statements of the Company, and neither
the Warrant Agent nor any of its stockholders, officers, directors,
employees or agents assumes any responsibility for the correctness of
any of the same except such as describe the Warrant Agent or action
taken or to be taken by it. Neither the Warrant Agent nor any of its
stockholders, officers, directors, employees or agents assumes any
responsibility with respect to the distribution of the Warrant
Certificates except as herein provided.
(b) Neither the Warrant Agent nor any of its stockholders,
officers, directors, employees or agents shall be responsible for any
failure of the Company to comply with any of the covenants contained in
this Agreement or in the Warrant Certificates to be complied with by
the Company.
(c) The Warrant Agent may consult at any time with counsel
satisfactory to it (who may be counsel for the Company) and neither the
Warrant Agent nor any of its stockholders, officers, directors,
employees or agents shall incur any liability or responsibility to the
Company or to any holder of any Warrant Certificate in respect of any
action taken, suffered or omitted by any of them hereunder in good
faith and in accordance with the opinion or the advice of such counsel.
(d) Whenever in the performance of its duties under this
Agreement the Warrant Agent shall deem it necessary or desirable that
any fact or matter be proved or established by the Company prior to
taking or suffering any action hereunder, such fact or matter (unless
other evidence in respect thereof be herein specifically prescribed)
may be deemed to be conclusively proved and established by a
certificate signed by the Chairman, President or a Vice President of
the Company and delivered to the Warrant Agent; and such certificate
shall be full authorization to the Warrant Agent for any action taken
or suffered in good faith by it under the provisions of this Agreement
in reliance upon such certificate.
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16
(e) Neither the Warrant Agent nor any of its stockholders,
officers, directors, employees or agents shall incur any liability or
responsibility to the Company or to any holder of any Warrant
Certificate for any action taken in reliance on any Warrant
Certificate, certificate of shares, notice, resolution, waiver,
consent, order, certificate, or other paper, document or instrument
believed to be genuine and believed to have been signed, sent or
presented by the proper party or parties.
(f) The Company agrees to pay to the Warrant Agent reasonable
compensation for all services rendered by the Warrant Agent in the
execution and performance of this Agreement, to reimburse the Warrant
Agent for all expenses, taxes and governmental charges and other
charges of any kind and nature reasonably incurred by the Warrant Agent
in the execution and performance of this Agreement and to indemnify the
Warrant Agent, its stockholders, officers, directors, employees and
agents and their respective heirs, personal representatives,
administrators, executors, successors and assigns and save each of them
harmless against any and all liabilities, including judgments, costs
and counsel fees, for anything done or omitted by the Warrant Agent in
the execution and performance of this Agreement except as a result of
its negligence or bad faith.
(g) The Warrant Agent shall be under no obligation to
institute any action, suit or legal proceeding or to take any other
action likely to involve expense unless the Company shall furnish the
Warrant Agent with reasonable security and indemnity for any costs and
expenses which may be incurred, but this provision shall not affect the
power of the Warrant Agent to take such action as it may consider
proper, whether with or without any such security or indemnity.
(h) Except as otherwise required by law, 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 become pecuniarily interested in any transaction in
which the Company may be interested, or contract with or lend money to
the Company or otherwise act as fully and freely as though they were
not the Warrant Agent under this Agreement, or a stockholder, director,
officer or employee of the Warrant Agent, as the case may be. Nothing
herein shall preclude the Warrant Agent from acting in any other
capacity for the Company, or for any other legal entity.
(i) The Warrant Agent shall act hereunder solely as Agent for
the Company, and its duties shall be determined solely by the provision
hereof. Neither the Warrant Agent nor any of its stockholders,
officers, directors, employees or agents shall be liable for anything
which it may do or refrain from doing in connection with this Agreement
except for its own negligence or bad faith.
(j) The Warrant Agent is hereby authorized and directed to
accept instructions with respect to the performance of its duties
hereunder from the Chairman, President or a Vice President of the
Company and to apply to such officers for advice or instructions in
connection with the Warrant Agent's duties, and neither it nor any of
its stockholders, officers, directors, employees or agents shall be
liable for any action taken or suffered or omitted by it in good faith
in accordance with instructions of any such officer.
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17
(k) Neither the Warrant Agent nor any of its stockholders,
officers, directors, employees or agents shall at any time be under any
duty or responsibility to any holder of any Warrant Certificate to make
or cause to be made any adjustment of the Exercise Price, the number of
the Warrant Shares or other securities or property deliverable as
provided in this Agreement, or to determine whether any facts exist
which may require any of such adjustments or with respect to the nature
or extent of any such adjustment, when made, or with respect to the
method employed in making the same. Neither the Warrant Agent nor any
of its stockholders, officers, directors, employees or agents shall be
accountable with respect to the validity or value or the kind or amount
of any Warrant Shares or of any securities or property which may at any
time be issued or delivered upon the exercise of any Warrant or at the
expiration of the period during which the Warrants are exercisable for
any unexercised Warrant or with respect to whether any such Warrant
Shares or other securities will when issued be validly issued and fully
paid and nonassessable, and makes no representation with respect
thereto.
SECTION 17. CHANGE OF WARRANT AGENT. The Warrant Agent may
resign and be discharged from its duties under this Agreement after giving 30
days prior written notice to the Company. The Warrant Agent may be removed by
the Company by like notice to the Warrant Agent. If the office of Warrant Agent
becomes vacant by resignation, removal, incapacity to act, or otherwise, the
Company shall appoint a successor to the Warrant Agent (which may be the
Company). If the Company shall fail to make such appointment within a period of
30 days after it has been notified in writing of such incapacity or resignation
by the Warrant Agent or by the registered holder of a Warrant Certificate, then
the registered holder of any Warrant Certificate may apply to any court of
competent jurisdiction for the appointment of a successor to the Warrant Agent.
Pending appointment of a successor to the Warrant Agent, either by the Company
or by such a court, the duties of the Warrant Agent shall be carried out by the
Company. Any successor Warrant Agent whether appointed by the Company or by such
a court shall be a bank or trust company, in good standing, incorporated under
the laws of the United States of America or of a state of the United States of
America, and must have at the time of its appointment as Warrant Agent a
combined capital and surplus of at least $500,000. After appointment, the
successor Warrant Agent shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named as Warrant Agent without
further act or deed; but the former Warrant Agent shall deliver and transfer to
the successor Warrant Agent any property at the time held by it hereunder and
execute and deliver any further assurance, conveyance, act or deed necessary for
the purpose. The Company shall cause notice of the appointment of any successor
Warrant Agent to be mailed by first-class mail, postage prepaid, to each
registered holder of a Warrant Certificate at his address appearing on the
Warrant Register. Failure to give any notice provided for in this SECTION 17, or
any defect therein, shall not, however, affect the legality or validity of the
appointment of a successor Warrant Agent.
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18
SECTION 18. ISSUANCE OF NEW WARRANT CERTIFICATES.
Notwithstanding any of the provisions of this Agreement or of the Warrants to
the contrary, the Company may, at its option, issue new Warrant Certificates
evidencing Warrants in such form as may be approved by its Board of Directors to
reflect any adjustment or change in the Exercise Price and the number or kind or
class of shares of stock or other securities or property purchasable under the
Warrant Certificates made in accordance with the provisions of this Agreement.
SECTION 19. NOTICES TO COMPANY AND WARRANT AGENT. Any notice
pursuant to this Agreement to be given by the Warrant Agent or by the registered
holder of any Warrant Certificate to the Company shall be sufficiently given if
sent by first-class mail, postage prepaid, addressed to the Company as follows:
New Valley Corporation
000 X.X. Xxxxxx Xxxxxx
Xxxxx, Xxxxxxx 00000
Attention: General Counsel
(or to such other address as the Company may have furnished in writing to the
Warrant Agent for this purpose).
Any notice pursuant to this Agreement to be given by the
Company or by any registered holder of any Warrant Certificate to the Warrant
Agent shall be sufficiently given if sent by first-class mail, postage prepaid,
addressed to the Warrant Agent as follows:
American Stock Transfer & Trust Company
[ADDRESS]
-------------------
Attention: Corporate Trust Department
(or to such other address as the Warrant Agent may have furnished in writing to
the Company for this purpose).
SECTION 20. IDENTITY OF TRANSFER AGENT. Forthwith upon the
appointment of any subsequent transfer agent for Common Shares, or any other
shares of the Company's capital stock issuable upon the exercise of the
Warrants, the Company will file with the Warrant Agent a statement setting forth
the name and address of such subsequent transfer agent.
SECTION 21. SUPPLEMENTS AND AMENDMENTS. The Company and the
Warrant Agent may from time to time supplement or amend this Agreement without
the approval of any holders of Warrant Certificates in order to cure any
ambiguity, to correct or supplement any provision contained herein which may be
defective or inconsistent with any provisions herein, to make any necessary
changes as required by SECTIONS 6, 7 or 12, or to make any other provisions in
regard to matters or questions arising hereunder which the Company may deem
necessary or desirable and which shall not adversely affect the interests of the
holders of the Warrant Certificates. The Warrants may otherwise be amended only
if the Company has obtained the consent of the holders of Warrants representing
a majority of Warrant Shares issuable upon exercise of all outstanding Warrants,
PROVIDED, HOWEVER, that no such action may increase the Exercise Price of the
Warrants or decrease the number of Warrant Shares issuable upon exercise
15
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of each Warrant without the written consent of the holders of Warrants
representing at least 66 2/3% of the Warrant Shares issuable upon exercise of
all outstanding Warrants. Until an amendment becomes effective, such consent of
the holders of Warrant Certificates shall bind all subsequent holders. Once such
amendment becomes effective, it shall bind all holders of Warrant Certificates.
SECTION 22. SUCCESSORS. All the covenants and provisions of
this Agreement by or for the benefit of the Company or the Warrant Agent shall
bind and inure to the benefit of their respective successors and assigns
hereunder.
SECTION 23. TERMINATION. This Agreement shall terminate at the
close of business on the Expiration Date. Notwithstanding the foregoing, this
Agreement will terminate on any earlier date when all Warrants have been
exercised or redeemed. The provisions of SECTION 16 shall survive such
termination.
SECTION 24. GOVERNING LAW. This Agreement and each Warrant
Certificate issued hereunder shall be deemed to be a contract made under the
laws of the State of New York and for all purposes shall be construed in
accordance with the laws of said State.
SECTION 25. BENEFITS OF THIS AGREEMENT. Nothing in this
Agreement shall be construed to give to any person or corporation other than the
Company, the Warrant Agent and the registered holders of the Warrant
Certificates any legal or equitable right, remedy or claim under this Agreement;
and this Agreement shall be for the sole and exclusive benefit of the Company,
the Warrant Agent and the registered holders of the Warrant Certificates.
SECTION 26. COUNTERPARTS. This Agreement may be executed in
any number of counterparts and each of such counterparts shall for all purposes
be deemed to be an original, and all such counterparts shall together constitute
but one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed, as of the day and year first above written.
NEW VALLEY CORPORATION
By:
---------------------------
Name:
Title:
AMERICAN STOCK TRANSFER &
TRUST COMPANY
By:
---------------------------
Name:
Title:
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EXHIBIT A
[FORM OF WARRANT CERTIFICATE]
[FACE]
EXERCISABLE ONLY ON OR AFTER EFFECTIVE DATE
(AS PROVIDED IN THE
WARRANT AGREEMENT REFERRED TO BELOW)
No. W- _______Warrants
WARRANT CERTIFICATE
NEW VALLEY CORPORATION
This Warrant Certificate certifies that or registered
assigns is the registered holder of Warrants (the "WARRANTS") expiring
____________ (or such earlier or later date as may be fixed under the
circumstances set forth in the Warrant Agreement and described on the reverse
hereof) to purchase Common Shares of New Valley Corporation, a Delaware
corporation (the "COMPANY"). Each Warrant entitles the holder to purchase from
the Company one fully paid and nonassessable Common Share of the Company at the
exercise price (the "EXERCISE PRICE") at the time in effect under the Warrant
Agreement ($12.50 per share, at the time of the initial issuance of the
Warrants), payable in lawful money of the United States of America by certified
or official bank check payable to the order of the Company, upon surrender of
this Warrant Certificate and payment of such Exercise Price to the Company at
the principal office of the Warrant Agent in ___________, or at another office
or agency to be maintained by the Company, but only subject to the conditions
set forth herein and in the Warrant Agreement; PROVIDED, HOWEVER, that no
fractional shares shall be issued on exercise of this Warrant and that the
number or kind of shares (or in certain events other property) purchasable upon
exercise of the Warrants and the Exercise Price referred to on the reverse
hereof may as of the date of this Warrant Certificate have been, or may after
such date be, adjusted as a result of the occurrence of certain events, as more
fully provided in the Warrant Agreement.
No Warrant may be exercised after the close of business on
______________ or such earlier or later date as may be fixed under the
circumstances set forth in the Warrant Agreement and described on the reverse
hereof (the "EXPIRATION DATE").
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.
22
This Warrant Certificate shall not be valid unless
countersigned by the Warrant Agent (or an authenticating agent of the Warrant
Agent appointed pursuant to SECTION 1 of the Warrant Agreement) by the manual
signature of one of its authorized officers.
IN WITNESS WHEREOF, NEW VALLEY CORPORATION has caused this
Instrument to be signed manually or in facsimile by its Chairman of the Board,
President or a Vice President and by its Secretary or an Assistant Secretary and
a facsimile of its corporate seal to be imprinted hereon.
NEW VALLEY CORPORATION
By:
---------------------------------
Name:
Title:
Countersigned:
----------------------------------------
as Warrant Agent
By:
-------------------------------------
Authorized Officer
OR
----------------------------------------
as Warrant Agent
By:
-------------------------------------
as Authenticating Agent
By:
-------------------------------------
Authorized Officer
Void after ___________ or such earlier or later date as may be
fixed under the circumstances set forth in the Warrant Agreement and described
on the reverse hereof.
2
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[FORM OF WARRANT CERTIFICATE]
[REVERSE]
NEW VALLEY CORPORATION
The Warrants evidenced by this Warrant Certificate are part of
a duly authorized issue of Warrants issued pursuant to a Warrant Agreement dated
as of _______ __, 1999 (the "WARRANT AGREEMENT"), duly executed and delivered by
the Company to American Stock Transfer & Trust Company, Warrant Agent (the
"WARRANT AGENT"), which Warrant Agreement is hereby incorporated by reference in
and made a part of this instrument and is hereby referred to for a description
of the rights, limitation of rights, obligations, duties and immunities
thereunder of the Warrant Agent, the Company and the holders (the words
"HOLDERS" or "HOLDER" meaning the registered holders or registered holder) of
the Warrants, and a copy of which Warrant Agreement will be available at the
office of the Secretary of the Company for inspection by holders of Warrants
during normal business hours.
The holder of Warrants evidenced by this Warrant Certificate
may exercise them by surrendering the Warrant Certificate, with the Form of
Exercise set forth hereon properly completed and executed, together with payment
of the Exercise Price at the time in effect, to the Company at the principal
office of the Warrant Agent in _________________. In the event that upon any
exercise of Warrants evidenced hereby the number of Warrants exercised shall be
less than the total number of Warrants evidenced hereby, there shall be issued
to the holder hereof or his assignee a new Warrant Certificate evidencing the
number of Warrants not exercised.
The Company may elect by written notice given as hereinafter
provided (the "REDEMPTION NOTICE") to redeem the Warrants at a price of $.01 per
Warrant if, at any time after the third anniversary of the effective date of the
plan of recapitalization, the average closing price or bid price of a Common
Share, as reported on NASDAQ or the Bulletin Board or by the National Quotation
Bureau or on a national securities exchange, as the case may be, exceeds $12.50
for any 20 consecutive trading days ending within five days prior to the date of
the Redemption Notice (such date of the Redemption Notice being referred to
herein as the "REDEMPTION NOTICE DATE"). Copies of the Redemption Notice shall
be mailed to the registered holders of the Warrant Certificates as provided in
SECTION 14. The Company must provide at least 30 days' notice to the holders of
the Warrants prior to redemption of the Warrants.
The Expiration Date may be extended by the Company in its sole
discretion from time to time by a notice given to the Warrant Agent and mailed
to the registered holders of the Warrant Certificates.
The Warrant Agreement provides that upon the occurrence of
certain events the Exercise Price may, subject to certain conditions, be
adjusted and under certain circumstances the Warrant may become exercisable for
securities or other assets other than the shares referred to on the face hereof.
If the Exercise Price is adjusted, the Warrant Agreement provides that the
number of Common Shares purchasable upon the exercise of each Warrant shall be
adjusted in certain circumstances.
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This Warrant Certificate is transferable, in whole or in part,
on the register maintained by the Company at the principal office of the Warrant
Agent for such purpose, upon surrender of this Warrant Certificate at the office
of the Warrant Agent, or at another office or agency to be maintained by the
Company, together with a written assignment of the Warrant Certificate, on the
Form of Assignment set forth hereon or in other form satisfactory to the Warrant
Agent, duly executed by the holder or his duly appointed legal representative,
and together with funds to pay any transfer taxes payable in connection with
such transfer. Upon such surrender and payment, a new Warrant Certificate shall
be issued and delivered, in the name of the assignee and in the denomination or
denominations specified in such instrument of assignment. If less than all of
this Warrant Certificate is being transferred, a new Warrant Certificate or
Certificates shall be issued for the portion of this Warrant Certificate not
being transferred.
This Warrant Certificate may be divided or combined with other
Warrant Certificates upon surrender hereof to the Company at the principal
office of the Warrant Agent, or at another office or agency to be maintained by
the Company, together with a written notice specifying the names and
denominations in which new Warrant Certificates are to be issued, signed by the
holder hereof or his duly appointed legal representative, and together with the
funds to pay any transfer taxes payable in connection with such transfer. Upon
such surrender and payment, a new Warrant Certificate or Certificates shall be
issued and delivered in accordance with such notice.
The Company shall make no service or other charge in
connection with any such transfer or exchange of this Warrant Certificate,
except for any transfer taxes payable in connection therewith.
The Company and the Warrant Agent may deem and treat the
registered holder hereof as the absolute owner of this Warrant Certificate
(notwithstanding any notation of ownership or other writing hereon made by
anyone), for the purpose of any exercise or conversion hereof, any distribution
to the holder hereof, and for all other purposes, and neither the Company nor
the Warrant Agent shall be affected by any notice to the contrary.
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[FORM OF EXERCISE]
(To be executed upon exercise of Warrant)
The undersigned hereby irrevocably elects to exercise the
right, represented by this Warrant Certificate, to purchase Common Shares
and herewith tenders payment for such Common Shares to the order of New Valley
Corporation in the amount of $ in accordance with the terms hereof. The
undersigned requests that a certificate for such Common Shares be registered in
the name of whose address is . If said number of Common Shares is
less than all of the Common Shares purchasable hereunder, the undersigned
requests that a new Warrant Certificate representing the remaining balance of
the Common Shares be registered in the name of whose address is
and that such Warrant Certificate be delivered to whose address is .
Dated:
Signature:
----------------------------
(Signature must conform in all
respects to name of holder as
specified on the face of the Warrant
Certificate.)
--------------------------------
(Insert Social Security or
Taxpayer Identification
Number of Holder)
Signature Guaranteed:
--------------------------------
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[FORM OF ASSIGNMENT)
(To be executed to transfer the Warrant Certificate)
FOR VALUE RECEIVED hereby sells, assigns and transfers
unto whose address is this Warrant Certificate, together with all right,
title and interest therein, and does hereby irrevocably constitute and appoint
attorney to transfer the within Warrant Certificate on the books of the
within-named Corporation, with full power of substitution.
Dated: Signature:
----------------------------
(Signature must conform in all
respects to name of holder as
specified on the face of the Warrant
Certificate.)
--------------------------------
(Insert Social Security or
Taxpayer Identification
Number of Assignee)
Signature Guaranteed:
--------------------------------