Exhibit 10.64
WARRANT AGREEMENT
BETWEEN
NATIONSBANK, N.A.
AND
VITAS HEALTHCARE CORPORATION
September 1, 1997
TABLE OF CONTENTS
ARTICLE 1
CERTAIN DEFINITIONS
ARTICLE 2
ORIGINAL ISSUE OF WARRANTS
2.1 Form of Warrant Certificates.......................................... 5
2.2 Legend................................................................ 5
2.3 Delivery of the Warrants.............................................. 5
ARTICLE 3
EXERCISE OF WARRANTS
3.1 Exercise Price........................................................ 6
3.2 Restrictions on Exercise; Expiration.................................. 6
3.3 Method of Exercise; Payment of Exercise Price......................... 6
3.4 Dividends and Distributions........................................... 8
3.5 Stockholder Rights.................................................... 8
ARTICLE 4
ADJUSTMENTS
4.1 Adjustments........................................................... 9
4.2 Termination of Right of Exercise on Fundamental Corporate Changes..... 12
4.3 Statements in the Warrants............................................ 13
4.4 Fractional Interests.................................................. 13
4.5 No Dilution or Impairment............................................. 13
ARTICLE 5
RESERVATION AND AUTHORIZATION OF COMMON SHARES
5.1 Reservation and Authorization......................................... 13
5.2 Covenant Regarding Securities......................................... 13
5.3 Registration.......................................................... 13
ARTICLE 6
WARRANT TRANSFER BOOKS; RESTRICTIONS ON TRANSFER
6.1 Transfer and Exchange................................................. 14
ARTICLE 7
REGISTRATION RIGHTS
i
ARTICLE 8
MISCELLANEOUS
8.1 Loss or Mutilation.................................................... 17
8.2 Payment of Taxes...................................................... 17
8.3 Notices............................................................... 17
8.4 Governing Law......................................................... 18
8.5 Assignment; Successors................................................ 18
8.6 Counterparts.......................................................... 18
8.7 Amendments............................................................ 18
8.8 Headings.............................................................. 19
8.9 Third Party Beneficiaries............................................. 19
8.10 Severability.......................................................... 19
8.11 No Inconsistent Agreements............................................ 19
ii
WARRANT AGREEMENT
WARRANT AGREEMENT, dated as of September 1, 1997 (this "Agreement"),
between VITAS HEALTHCARE CORPORATION, a Delaware corporation (the
"Corporation"), and NATIONSBANK, N.A. (successor by merger of NationsBank,
N.A. (South) ("NationsBank").
WHEREAS, pursuant to the terms of an Amendment No. 7 dated as of
September 1, 1997 ("Amendment No. 7") to Amended and Restated Revolving
Credit, Term Loan and Reimbursement Agreement dated as of February 17, 1995,
as amended, among the Corporation, NationsBank, as Agent, and NationsBank,
as Lender (as previously amended and as amended by Amendment No. 7, the
"Credit Agreement"), NationsBank, among other things, has agreed to continue
to make available to the Corporation loans of up to $32,000,000 (the "Loans"),
which Loans are evidenced by Notes of the Corporation in favor of NationsBank
(the "Notes");
WHEREAS, in order to induce NationsBank to enter into Amendment No. 7,
the Corporation has agreed to execute and deliver to NationsBank 291,918
stock purchase warrants ("Warrants") issued pursuant to this Agreement
entitling the Holder(s) (as defined herein) thereof to purchase from the
Corporation an aggregate of 291,918 shares (the "Warrant Shares") of the
Corporation's common stock, par value $.001 per share ("Common Stock"), at
the Exercise Price (as defined herein), subject to adjustment as provided in
Article 4 hereof, at any time on or after the date hereof and before 5:00
P.M., New York City time, on the Expiration Date (as defined herein), subject
to the terms and conditions hereof.
NOW, THEREFORE, in consideration of the foregoing and of the agreements
contained in the Credit Agreement, and for the purpose of defining the terms
and provisions of the Warrants and Warrant Shares and the respective rights
and obligations thereunder of the Corporation and the Holder(s), the
Corporation and NationsBank hereby agree as follows:
ARTICLE 1
CERTAIN DEFINITIONS
For all purposes of this Agreement, except as otherwise expressly
provided:
(a) the terms defined in this Article 1 have the meanings
assigned to them in this Article, and include the plural as well as the
singular; and
(b) the words "herein," "hereof" and "hereunder," and other
words of similar import, refer to this Agreement as a whole and not to any
particular article, section or other subdivision.
"Adjustment Period" shall mean the period of five (5) consecutive
trading days selected by the Board of Directors in its sole discretion,
during the twenty (20) trading days preceding, and including the date as of
which the Fair Market Value of a security is to be determined.
"Affiliate" means, as to any Person, any other Person which directly or
indirectly controls, or is under common control with, or is controlled by,
such Person. For purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling," "under common control with"
and "controlled by"), as used with respect to any Person, shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting stock, by agreement or otherwise; provided, however, that
beneficial ownership of 25% or more of the total voting power of all
outstanding stock of a Person shall be deemed to be control of such Person.
"Agreement" has the meaning set forth in the preamble hereto.
"Amendment No. 7" has the meaning set forth in the preamble hereto.
"Board of Directors" means the board of directors of the Corporation.
"Business Day" means any day which is not a Saturday, Sunday or a day
on which banking institutions in the States of New York or Florida are not
authorized or obligated by law, executive order, regulation or governmental
decree to close.
"Commission" means the Securities and Exchange Commission.
"Common Stock" has the meaning set forth in the preamble hereto.
"Corporation" has the meaning set forth in the preamble hereto.
"Current Market Price" of publicly traded shares of Common Stock or any
other class of capital stock or other security of the Corporation or any
other issuer for any given day shall mean the last reported sales price,
regular way, or, in case no sale takes place on such day, the average
reported closing bid and asked prices, regular way, in either case as
reported on the New York Stock Exchange Composite Tape or, if such security
is not listed or admitted to trading on any national securities exchange, on
the NASDAQ National Market or, if such security is not quoted on such NASDAQ
National Market, the average of the closing bid and asked prices on such day
in the over-the-counter market as reported by NASDAQ, or, if bid and asked
prices for such security on such day shall not have been reported through
NASDAQ, the average of the bid and asked prices for such day as furnished by
any New York Stock Exchange member firm regularly making a market in such
security selected for such purpose by the Board of Directors.
"Credit Agreement" has the meaning set forth in the preamble hereto.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the Commission promulgated thereunder.
2
"Exempt Securities" shall mean the issuance of (a) Warrant Shares or
other securities issuable pursuant to the Warrants; (b) securities of the
Corporation issued upon the exercise, conversion or exchange of securities
of the Corporation issued prior to the date hereof; (c) shares of Common Stock
or other Corporation securities issued or issuable as a result of adjustments
under Section 4 or other applicable provisions of the Series B Certificate of
Designation or similar provisions of other convertible securities; (d) any
securities of the Corporation issued in exchange for assets or securities in
a merger, consolidation, sale or purchase of assets or other business
combination transaction approved by the Board of Directors; (e) any
securities issuable or any adjustment made or to be made to the Warrants or
Warrant Shares under Article 4 of this Agreement; (f) any rights or other
securities issued or issuable pursuant to a stockholder rights agreement
under which the Board of Directors would declare a dividend of one preferred
(or common) share purchase right for each outstanding share of Common Stock
provided that such stockholder rights agreement results in equivalent
dividends on Warrant Shares; (g) any shares of Common Stock pursuant to any
plan providing for the reinvestment of dividends or interest payable on
securities of the Corporation and the investment of additional optional
amounts in shares of Common Stock under any such plan; (h) any shares of
Common Stock in a public offering registered under the Securities Act; (i)
any shares of Common Stock or options or rights to purchase such shares
pursuant to any stock option or bonus plan or plans now or hereafter adopted
by the Corporation (including any stock appreciation rights or employee stock
ownership plan) for the benefit of directors, officers, employees and/or
consultants of the Corporation and/or its subsidiaries or pursuant to any
employee benefit plan or program now or hereafter adopted by the Corporation
for the benefit of its employees and/or employees of its subsidiaries, or
pursuant to any specific grant not pursuant to any plan or program that is
approved by the Corporation's Board of Directors; or (j) the issuance or
repurchase of Corporation securities on or prior to the date the Warrants are
first issued (or any subsequent issuances of Common Stock, 9% Preferred Stock
or Series B Preferred Stock issued pursuant to warrants, options or rights
previously granted, outstanding or issued on the date the Warrants are first
issued).
"Exercise Price" has the meaning set forth in Section 3.1 hereof.
"Expiration Date" means September 1, 2007.
"Extraordinary Distribution" shall mean any dividend or other
distribution with respect to the Common Stock (effected while any of the
Warrants are outstanding) of any shares of capital stock of the Corporation
(other than shares of Common Stock), other securities of the Corporation
(other than securities of the type referred to in Section 4.1(c)), evidences
of indebtedness of the Corporation or any other person or any other property
other than cash (including shares of any subsidiary of the Corporation), or
any combination thereof.
"Fair Market Value" shall mean, as to shares of Common Stock or any
other class of capital stock or securities of the Corporation or any other
issuer which are publicly traded, the average of the Current Market Prices
of such shares or securities for each day of the Adjustment Period. The "Fair
Market Value" of any security which is not publicly traded or of any other
3
property shall mean the fair value thereof as determined in good faith by the
Board of Directors in its sole discretion.
"Holders" shall mean NationsBank or an Affiliate thereof and such other
Persons to whom NationsBank or an Affiliate thereof transfers Warrants in
compliance with the terms of this Agreement and each subsequent permitted
transferee.
"NationsBank" has the meaning set forth in the preamble hereto.
"9% Certificate of Designation" shall mean the Certificate of
Designation, Preferences and Other Rights of the 9.0% Cumulative
Nonconvertible Preferred Stock of the Corporation, as amended from time to
time.
"9% Preferred Stock" shall mean the 9.0% Cumulative Nonconvertible
Preferred Stock of the Corporation, par value $1.00 per share, which is
issued under the 9% Certificate of Designation.
"Notes" has the meaning set forth in the preamble hereto.
"Person" shall mean a natural person, partnership, corporation,
association, joint stock company, trust, joint venture, unincorporated
association, governmental entity or any department, agency or political
subdivision thereof, or other entity.
"Private Placement Legend" means the legend in the form set forth in
Section 2.2 hereof.
"Qualified Initial Public Offering" shall mean public offering of the
Corporation's Common Stock resulting in gross proceeds to the Corporation of
not less than $12 million and at a total market capitalization of the common
equity of the Corporation at that time of not less than $60 million.
"Registration Rights Agreement" shall mean that certain Registration
Rights Agreement dated as of June 4, 1993 among the Corporation, certain
stockholders of the Corporation, Cherned Corporation and the investors
identified on Schedule A thereto.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the Commission promulgated thereunder.
"Series B Certificate of Designation" shall mean the Certificate of
Designation, Preferences and Other Rights of the Series B Convertible
Preferred Stock of the Corporation, as amended from time to time.
"Series B Preferred Stock" shall mean the Series B Convertible Preferred
Stock of the Corporation, par value $1.00 per share, which is issued under
the Series B Certificate of Designation.
4
"Warrants" has the meaning set forth in the preamble hereto.
"Warrant Certificate" has the meaning set forth in Section 2.1 hereto.
"Warrant Shares" has the meaning set forth in the preamble hereto.
ARTICLE 2
ORIGINAL ISSUE OF WARRANTS
2.1 Form of Warrant Certificates. Any certificate representing the
Warrants (a "Warrant Certificate"), the form of which is attached hereto as
Exhibit A, shall be detachable from the Credit Agreement and any Notes and
shall be dated the date on which it is signed by a duly authorized officer of
the Corporation and shall have such insertions as are appropriate or required
or permitted by this Agreement and may have such letters, numbers or other
marks of identification as the Corporation may deem appropriate and as are
not inconsistent with the provisions of this Agreement.
2.2 Legend. Subject to the provisions hereof, each Warrant Certificate
and each certificate representing securities acquired upon exercise of the
Warrants shall bear the following legend on the face thereof:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS
AND CONDITIONS OF A CERTAIN AGREEMENT WHICH INCLUDES A RIGHT OF FIRST REFUSAL
ON THE SALE OF THE SECURITIES. COPIES OF THE AGREEMENT MAY BE OBTAINED UPON
WRITTEN REQUEST TO THE SECRETARY OF THE CORPORATION.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE
SECURITIES LAWS AND CANNOT BE OFFERED, SOLD OR TRANSFERRED WITHOUT
REGISTRATION OR COMPLIANCE WITH EXEMPTION FROM REGISTRATION UNDER THE ACT AND
APPLICABLE STATE SECURITIES LAWS AND REGULATIONS PROMULGATED THEREUNDER.
A full statement of the powers, designations, preferences and relative,
participating, optional or other special rights of the shares of each class
of stock of the Corporation authorized to be issued, and the qualifications,
limitations or restrictions of such preferences and/or rights, will be
furnished to any stockholder without charge upon request to the Secretary of
the Corporation.
2.3 Delivery of the Warrants
This Agreement contemplates the issuance of up to 291,918 Warrants,
subject to adjustment as provided herein. Concurrently with the execution
and delivery of this Agreement,
5
the Corporation shall issue to NationsBank or an Affiliate thereof in
connection therewith (but detachable therefrom) a Warrant Certificate for
291,918 Warrants.
ARTICLE 3
EXERCISE OF WARRANTS
3.1 Exercise Price.
The Warrant Certificate shall entitle the Holders thereof, subject to
the provisions of this Agreement, to purchase an aggregate of two hundred
ninety-one thousand nine hundred eighteen (291,918) Warrant Shares at a per
share purchase price (the "Exercise Price") of $.01, subject to the
limitations and adjustments as provided in Article 4 hereof; provided,
however, that in no event shall the exercise price per share of Common Stock
be less than the par value of such Common Stock.
3.2 Restrictions on Exercise; Expiration. Subject to the limitations
and adjustments as provided herein, on or before the Expiration Date, the
Warrants may be exercised on any Business Day as to all or any portion of the
Warrant Shares for which the Warrants are then exercisable as follows: (a)
as of the date of this Agreement and the issuance of the Warrant Certificate,
the number of Warrants which may be exercised pursuant to this Agreement, and
the number of Warrant Shares issuable upon exercise of such Warrants, shall
be none; (b) in the event the Corporation shall not have paid in full its
Obligations (as defined in the Credit Agreement) on or prior to April 29,
1998, the number of Warrants which may be exercised pursuant to this
Agreement, and the number of Warrant Shares issuable upon exercise of such
Warrants, shall be 97,306 effective as of April 30, 1998; (c) in the event
the Corporation shall not have been paid in full its Obligations (as defined
in the Credit Agreement) on or prior to July 30, 1998, the number of warrants
which may be exercised pursuant to this Agreement, and the number of Warrant
Shares issuable upon exercise of such Warrants, shall be automatically
increased to 194,612 effective as of July 31, 1998; and (d) in the event the
Corporation shall not have paid in full its Obligations (as defined in the
Credit Agreement) on or prior to September 29, 1998, the number of Warrants
which may be exercised pursuant to this Agreement, and the number of Warrant
Shares issuable upon exercise of such Warrants, will be automatically
increased to 291,918 effective as of September 30, 1998. The Exercise Price
shall not be adjusted by reason of any such increase in the number of
Warrants which may be exercised and in the number of Warrant Shares issuable
upon such exercise. If any of the Warrants are not exercised by 5:00 p.m.,
New York City time, on the Expiration Date, this Agreement and all
unexercised Warrants shall expire and all rights of the Holders hereunder and
thereunder shall terminate unless otherwise provided herein or therein.
3.3 Method of Exercise; Payment of Exercise Price.
(a) In order to exercise any of the Warrants, the Holder thereof must
provide written notice to the Corporation at its address set forth in Section
8.3 hereof in the form attached hereto as Exhibit B specifying the number of
Warrants being exercised. Such notice shall be
6
accompanied by Warrant Certificates representing not less than the number of
Warrants being exercised, together with payment in full of the per share
Exercise Price multiplied by the number of Warrant Shares to be purchased
pursuant to the exercise. The Exercise Price shall be payable at the option
of the Holder, by wire transfer, certified check, official bank check or bank
cashier's check payable to the order of the Corporation.
(b) In lieu of exercising Warrants pursuant to Section 3.3(a), the
Holder shall have the right to require the Corporation to convert the
Warrants, in whole or in part and at any time or times (the "Conversion
Right"), into Warrant Shares, by surrendering to the Corporation at its
address set forth in Section 8.3 hereof the Warrant Certificate evidencing
the Warrants to be converted, accompanied by the form of conversion notice
attached hereto as Exhibit C which has been duly completed and signed. Upon
exercise of the Conversion Right, the Corporation shall deliver to the Holder
(without payment by the Holder of any Exercise Price) that number of Warrant
Shares which is equal to the quotient obtained by dividing (x) the value of
the number of Warrants being converted at the time the Conversion Right is
exercised (determined by subtracting the aggregate Exercise Price for all
such Warrants immediately prior to the exercise of the Conversion Right from
the aggregate Fair Market Value of that number of Warrant Shares purchasable
upon exercise of such Warrants immediately prior to the exercise of the
Conversion Right (taking into account all applicable adjustments pursuant to
Article 4), by (y) the Fair Market Value of one share of Common Stock
immediately prior to the exercise of the Conversion Right. Any references in
this Agreement to the "exercise" of any Warrants, and the use of the term
"exercise" herein, shall be deemed to include (without limitation) any
exercise of the Conversion Right.
(c) If the number of Warrants being exercised is less than the number of
Warrants represented by the Warrant Certificate(s) tendered in connection
with the exercise, the Corporation shall issue new Warrant Certificate(s) for
the unexercised Warrants in accordance with instructions contained in the
notice of exercise and this Agreement.
(d) Upon exercise of any Warrant in conformity with the foregoing
provisions, the Corporation shall (i) transfer promptly to, or upon the
written order of, the Holder of such Warrant, appropriate evidence of
ownership of any Warrant Shares or other securities or property (including
money) to which it is entitled, registered or otherwise placed in such name
or names as may be directed in writing by the Holder thereof, (ii) deliver
such evidence of ownership and any other securities or property (including
money) to the person or persons entitled to receive the same, and (iii)
reissue, as the case may be, a Warrant Certificate for any unexercised
Warrants. Each new Warrant Certificate so issued shall bear the legend set
forth in Section 2.2 if the Warrant Certificate presented in connection with
partial exercise thereof bore such legend except to the extent that some or
all of the transfer restrictions referred to in such legend or this
Agreement are no longer applicable pursuant to Article 6 or as a result of
registration of the Warrant Shares pursuant to Article 7. All Warrant
Certificates surrendered upon exercise of Warrants shall be canceled. A
Warrant shall be deemed to have been exercised immediately prior to the close
of business on the date of the surrender to the Corporation for exercise of
the Warrant Certificate representing such Warrant being exercised and
accompanied by the notice required
7
under Section 3(a) or 3(b), as the case may be, for all purposes of this
Agreement, the person entitled to receive any Warrant Shares or other
securities or property deliverable upon such exercise shall, as between such
person and the Corporation, be deemed to be the Holder of such Warrant Shares
or other securities or property of record as of the close of business on
such date and shall be entitled to receive any Warrant Shares or other
securities or property (including money) to which such person would have been
entitled had such person been the record holder of such Warrant Shares or
other securities or property on such date.
3.4 Dividends and Distributions. For so long as any of the Warrants
remain outstanding and unexercised, the Corporation will, upon the
declaration of a cash dividend upon its Common Stock or other distribution to
the holders of its Common Stock (other than a dividend payable in shares of
the Corporation's Common Stock) and at least twenty (20) calendar days prior
to the record date for such dividend or other distribution (or if no record
date is specified, twenty (20) calendar days prior to the taking of the
action), notify the Holders of such declaration, which notice will contain,
at a minimum, the following information: (i) the date of the declaration of
the dividend or distribution, (ii) the amount of such dividend or
distribution, (iii) the record date of such dividend or distribution, and
(iv) the payment date or distribution date of such dividend or distribution.
The failure to give the notice required by this Section 3.4 or any defect
therein shall not affect the legality or validity of such dividend or
distribution.
3.5 Stockholder Rights.
(a) Nothing contained in this Agreement or in any of the Warrant
Certificates shall be construed as conferring upon the Holders thereof the
right to vote or to consent or to receive notice as a stockholder in respect
of the meetings of stockholders or the election of directors of the
Corporation or any other matter, or any rights whatsoever as a stockholder of
the Corporation.
(b) Nothing contained in this Agreement or in any of the Warrant
Certificates shall be construed as imposing any obligation on the registered
Holders thereof to purchase any securities or as imposing any liabilities on
such Holders as stockholders of the Corporation, whether such obligation or
liabilities are asserted by the Corporation or by creditors of the
Corporation (except for indemnities and other obligations in connection with
registration rights).
8
ARTICLE 4
ADJUSTMENTS
4.1 Adjustments. The Exercise Price and the number of Warrant Shares
issuable upon exercise of each Warrant shall be subject to adjustment from
time to time as follows:
(a) Intentionally Omitted.
(b) Adjustments for Changes in Common Stock. Subject to the provisions
of Section 4.1(e), in the event the Corporation shall, at any time or from
time to time while any of the Warrants are outstanding, (i) pay a dividend
or make a distribution in respect of the Common Stock in shares of Common
Stock or (ii) subdivide or combine the outstanding shares of Common Stock
into a greater or lesser number of shares, in each case whether by
reclassification of shares, recapitalization of the Corporation or otherwise,
then, in such event, each Warrant will automatically, without any action on
the part of the Holder or the Corporation, become exercisable for that number
of Warrant Shares equal to the number of Warrant Shares for which a Warrant
was exercisable immediately prior to such event multiplied by a fraction the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock outstanding immediately before such event. An
adjustment pursuant to this Section 4.1(b) shall be effective upon payment of
such dividend or distribution in respect of the Common Stock and in the case
of a subdivision or combination shall become effective immediately as of the
effective date thereof. Concurrently with the automatic adjustment pursuant
to this Section 4.1(b), the Exercise Price shall be adjusted by multiplying
the Exercise Price in effect immediately before the event by a fraction the
numerator of which is the number of shares of Common Stock outstanding
immediately before such event and the denominator of which is the number of
shares of Common Stock outstanding immediately after such event.
(c) Below Market Issuances. Subject to the provisions of Section 4.1(e),
in the event the Corporation shall, at any time or from time to time while
any of the Warrants are outstanding, sell or issue shares of Common Stock
(other than in a transaction subject to Section 4.1(b)), any security
convertible into shares of Common Stock or any option, right or warrant to
purchase shares of Common Stock for no consideration or at a purchase price per
share of Common Stock, or conversion price in the case of a security
convertible into Common Stock, less than the Fair Market Value of a share of
Common Stock on the date of issuance of such Common Stock, security
convertible into Common Stock, option, right or warrant, then, in such event,
each Warrant will automatically, without any action on the part of the holder
thereof or the Corporation, become exercisable for that number of Warrant
Shares equal to the number of Warrant Shares for which a Warrant was
exercisable immediately before such sale or issuance of Common Stock,
securities convertible into Common Stock, options, rights or warrants
multiplied by a fraction the numerator of which is the number of shares of
Common Stock outstanding immediately before such sale or issuance of Common
Stock, securities convertible into Common Stock, options, rights or warrants
plus the maximum number of shares of Common Stock that could be acquired upon
the sale or issuance of the Common Stock or upon exercise in full of all
9
such conversion rights, options, rights and warrants and the denominator of
which is the number of shares of Common Stock outstanding immediately before
such sale or issuance of Common Stock, securities convertible into Common
Stock, options, rights or warrants plus the number of shares of Common Stock
which could be purchased at the Fair Market Value of a share of Common Stock
at the time of such sale or issuance for the maximum aggregate consideration
payable upon the sale or issuance of the Common Stock or upon exercise in
full of all such conversion rights, options, rights or warrants. Concurrently
with the automatic adjustment pursuant to this Section 4.1(c), the Exercise
Price shall be adjusted by multiplying the Exercise Price in effect
immediately before such sale or issuance of Common Stock, securities
convertible into Common Stock, options, rights or warrants by a fraction the
numerator of which is the number of shares of Common Stock outstanding
immediately before such sale or issuance of Common Stock, securities
convertible into Common Stock, options, rights or warrants plus the number of
shares of Common Stock which could be purchased at the Fair Market Value of a
share of Common Stock at the time of such sale or issuance for the maximum
aggregate consideration payable upon the sale or issuance of the Common Stock
or upon exercise in full of all such conversion rights, options or warrants,
and the denominator of which is the number of shares of Common Stock
outstanding immediately before such sale or issuance of Common Stock,
securities convertible into Common Stock, options, rights or warrants plus
the maximum number of shares that could be acquired upon the sale or issuance
of the Common Stock or upon the exercise in full of all such conversion
rights, options, rights and warrants. For purposes of this Section 4.1(c),
all shares of Common Stock issuable upon the conversion of such convertible
securities or upon exercise of such options, warrants or rights shall be
deemed to have been issued, for the purpose of computing the number of Warrant
Shares for which a Warrant is exercisable and the Exercise Price hereunder,
as of the time such convertible securities, options, warrants or rights are
issued or sold. If any rights of conversion or exercise of such convertible
securities, options, rights or warrants shall expire without having been
exercised, the number of Warrants Shares for which a Warrant is exercisable
and the Exercise Price shall forthwith be automatically adjusted to be the
number of Warrant Shares for which a Warrant is exercisable and the Exercise
Price that would have been in effect had an adjustment been made on the basis
that the only shares of Common Stock issued or sold were those actually
issued upon the conversion or exercise of such convertible securities,
options, rights or warrants. For purposes of this Section 4.1(c), the date of
issuance of options for shares of Common Stock shall mean the date of their
grant. For purposes of this Section 4.1(c), "Common Stock outstanding shall
mean all shares of Common Stock outstanding on a fully diluted basis, as if
all securities convertible into or exchangeable for Common Stock had been
fully converted into or exchanged for shares of Common Stock and any
outstanding options, warrants or other rights to purchase Common Stock or
securities convertible into or exchangeable for Common Stock had been fully
exercised (and the resulting securities converted into or exchanged for
Common Stock), but excluding shares of Common Stock issuable upon exercise of
the Warrants.
(d) Extraordinary Distributions. Subject to the provisions of
Section 4.1(e) and Section 4.2, in the event the Corporation shall, at any
time or from time to time while any of the Warrants are outstanding, make an
Extraordinary Distribution in respect of the Common Stock, whether by
dividend, distribution, reclassification of shares or recapitalization of the
Corporation
10
(including recapitalization or reclassification effected by a merger or
consolidation in which the Corporation is the surviving entity) then, in such
event, each Warrant will automatically, without any action on the part of the
holder thereof or the Corporation, become exercisable for that number of
Warrant Shares equal to the number of Warrant Shares for which a Warrant was
exercisable immediately before such Extraordinary Distribution multiplied by
a fraction the numerator of which is the product of (a) the number of shares
of Common Stock outstanding immediately before such Extraordinary
Distribution multiplied by (b) the Fair Market Value of a share of Common
Stock on the record date with respect to an Extraordinary Distribution and
the denominator of which is (i) the product of (x) the number of shares of
Common Stock outstanding immediately before such Extraordinary Distribution
multiplied by (y) the Fair Market Value of a share of Common Stock on the
record date with respect to an Extraordinary Distribution minus (ii) the Fair
Market Value of the Extraordinary Distribution. The Corporation shall send
each Holder notice of its intent to make any Extraordinary Distribution at
the same time as, or as soon as practicable after, such offer is first
communicated (including by announcement of a record date in accordance with
the rules of any stock exchange on which the Common Stock is listed or
admitted to trading) to holders of Common Stock. Such notice shall indicate
the intended record date and the amount and nature of such distribution, as
well as the Exercise Price and the number of Warrant Shares for which a
Warrant may be exercised at such time. Concurrently with the automatic
adjustment pursuant to this Section 4.1(d), the Exercise Price shall be
adjusted by multiplying the Exercise Price in effect immediately before such
Extraordinary Distribution by a fraction the numerator of which is (i) the
product of (x) the number of shares of Common Stock outstanding immediately
before such Extraordinary Distribution multiplied by (y) the Fair Market
Value of a share of Common Stock on the record date with respect to an
Extraordinary Distribution, minus (ii) the Fair Market Value of the
Extraordinary Distribution and the denominator of which is the product of (a)
the number of shares of Common Stock outstanding immediately before such
Extraordinary Distribution multiplied by (b) the Fair Market Value of a share
of Common Stock on the record date with respect to an Extraordinary
Distribution.
(e) Exempt Securities. Notwithstanding any other provision herein to
the contrary, the issuance of any Exempt Securities shall not be deemed to
constitute an issuance of Common Stock or other security of the Corporation
(or in the case of any repurchase, any Extraordinary Distribution) for
purposes of the foregoing anti-dilution provisions.
(f) De Minimis Adjustments. Notwithstanding any other provisions of
this Section 4.1, the Corporation shall not be required to make (i) any
adjustment of the number of Warrant Shares or the Exercise Price unless such
adjustment would require an increase or decrease of at least one percent (1%)
in the aggregate number of Warrant Shares for which Warrants are exercisable
at that time, or (ii) any adjustment of the Exercise Price unless such
adjustment would require an increase or decrease of at least one percent (1%)
in the Exercise Price. Any lesser adjustment shall be carried forward and
shall be made no later than the time of, and together with, the next
subsequent adjustment which, together with any adjustment or adjustments so
carried forward, shall amount to an increase or decrease of at least one
percent (1%) of the number of Warrant Shares for which Warrants are
exercisable at that time or an increase or decrease of at least one percent
(1%) of the Exercise Price, whichever the case may be. If any action would
require adjustment of the Exercise
11
Price pursuant to more than one paragraph of Section 4.1, only one adjustment
shall be made as determined in good faith by the Board of Directors of the
Corporation.
(g) Notice of Adjustment. Whenever an adjustment to the Exercise
Price or number of Warrants and Warrant Shares is required pursuant to this
Section 4.1, the Corporation shall forthwith place on file with the transfer
agent for the Common Stock, if any, and with the Treasurer of the
Corporation, a statement signed by the Treasurer or Assistant Treasurer of
the Corporation stating the adjusted number of Warrant Shares and the
Exercise Price determined as provided herein. Such statement shall set forth
in reasonable detail such facts as shall be necessary to show the reason and
the manner of computing such adjustment, including any determination of Fair
Market Value involved in such computation. Promptly after each adjustment to
the number of Warrant Shares for which Warrants are exercisable or the
Exercise Price, the Corporation shall mail a notice thereof and of the then
prevailing number of Warrant Shares for which Warrants are exercisable and
the Exercise Price to each Holder.
4.2 Termination of Right of Exercise on Fundamental Corporate
Changes. Notwithstanding anything herein to the contrary, and subject to the
notice requirements of this Section 4.2, if the Corporation shall be a party
to any transaction which involves any consolidation or merger of the
Corporation with another corporation, or any sale of all or substantially all
of the assets of the Corporation to another corporation, and which is
effected in such a way that the holders of Common Stock shall be entitled to
receive cash, stock, securities or other assets with respect to or in
exchange for Common Stock, then the right to exercise the Warrants and
thereby to purchase shares of Common Stock shall terminate at the close of
business on the date as of which the holders of Common Stock of record shall
be entitled to exchange their shares of Common Stock for cash, securities or
other assets deliverable upon such consolidation, merger or sale of all or
substantially all of the assets of the Corporation. In case the Corporation
shall enter into any agreement or understanding or the Board of Directors
shall adopt any resolution authorizing or proposing any transaction of the
type described in this Section 4.2, or with respect to a voluntary or
involuntary dissolution, liquidation or winding up of the Corporation, then
in any such event the Corporation promptly shall cause to be mailed, by
registered or certified mail, postage paid, to the Holder of this Warrant at
such Holder's last address appearing on the records of the Corporation at the
earliest practicable time (and, in any event, not later than the later of (i)
the date the proxy materials (if any) are first distributed (or other notice
is first given) to the Corporation's shareholders regarding the proposed
transaction, or (ii) 20 days before the effective date (or record date, if
earlier) of such proposed transaction), notice of the date on which such
reorganization, sale, consolidation, merger, dissolution, liquidation or
winding up or other such transaction shall take place, as the case may be.
Such notice shall also set forth such facts as shall indicate the effect of
such action (to the extent such effect may be known at the date of such
notice) on the Exercise Price and the kind and amount of securities and
property purchasable upon exercise of the Warrants. Such notice shall also
specify the date as of which the holders of record of the shares of Common
Stock or other securities or property purchasable upon exercise of the
Warrants shall be entitled to exchange their shares or other securities or
property for securities, money or other property deliverable upon such
reorganization, sale, consolidation, merger, dissolution, liquidation or
winding up or other such transaction, as the case may be.
12
4.3 Statements in the Warrants. Notwithstanding any adjustment in the
Exercise Price or the number or kind of Warrant Shares purchasable upon the
exercise of the Warrants, the Warrant Certificates theretofore or thereafter
issued may continue to express the same price and number and kind of shares
as are stated in the Warrant Certificate initially issued pursuant to this
Agreement.
4.4 Fractional Interests. In computing adjustments under this Article
4, fractional interests in Common Stock shall be taken into account to the
nearest one-thousandth of a share. No fractional shares of Common Stock or
scrip representing fractional shares of Common Stock shall be issued upon any
exercise of the Warrants, but, in lieu thereof, there shall be paid an amount
in cash equal to the same fraction of the Market Price of a whole share of
Common Stock on the business day preceding the day of exercise.
4.5 No Dilution or Impairment. The Corporation shall not amend its
Certificate of Incorporation or participate in any reorganization, transfer
or assets, consolidation, merger, dissolution, issue or sale of securities or
any other voluntary action, for the purpose of avoiding or seeking to avoid
the observance or performance of any of the terms to be observed or performed
hereunder by the Corporation, but will at all times, in good faith, assist in
carrying out all such actions as may be reasonably necessary or appropriate
in order to protect the rights of the holders of the Warrants against
dilution or other impairment as set forth in this Agreement.
ARTICLE 5
RESERVATION AND AUTHORIZATION OF COMMON SHARES
5.1 Reservation and Authorization. The Corporation shall at all times
reserve and keep available for issuance upon exercise of the Warrants such
number of its duly authorized but unissued shares of Common Stock or other
securities of the Corporation purchasable upon exercise of the Warrants as
will be sufficient to permit the exercise in full of all outstanding Warrants
and will cause appropriate evidence of ownership of such shares of Common
Stock or other securities to be delivered to the Holders of the Warrants upon
their request for delivery of such, and all such shares of Common Stock or
other securities shall, at all times, be duly approved for listing, subject to
official notice of issuance, on each securities exchange, if any, on which
such shares of Common Stock or other securities are then listed.
5.2 Covenant Regarding Securities. The Corporation covenants that all
shares of Common Stock or other securities of the Corporation that may be
issued upon the exercise of the Warrants will, upon issuance, be (a) duly
authorized, validly issued, fully paid and nonassessable, (b) free from
preemptive and any other similar rights and (c) free from any taxes, liens,
charges or security interest with respect thereto except transfer taxes and
Florida documentary stamp taxes to the extent applicable thereto.
5.3 Registration. If the Warrant Shares or any securities of the
Corporation issuable to NationsBank upon the exercise of the Warrants require
registration with, or approval of, any governmental authority (in addition to
such as the Corporation is required to obtain pursuant to
13
Article 7 hereof), or the taking of any other action (in addition to such as
the Corporation is required to obtain pursuant to Article 7 hereof), under
the laws of the United States of America or any state or political
subdivision thereof, before such securities may be validly offered or sold in
compliance with such laws, then the Corporation covenants that it will, in
good faith and as expeditiously as practicable, endeavor to secure and
maintain such registration or approval or to take such other action, as the
case may be; provided, however, that the Corporation will not be required to
qualify generally to do business in any jurisdiction where it is not then so
qualified or to take any action that would subject it to general service of
process or to taxation in any such jurisdiction where it is not then so
subject; provided, further, that the expenses of such registration shall be
allocated in accordance with the provisions of the Registration Rights
Agreement.
ARTICLE 6
WARRANT TRANSFER BOOKS; RESTRICTIONS ON TRANSFER
6.1 Transfer and Exchange.
(a) Warrant Register. The Corporation shall keep and maintain at its
office a register in which, subject to such reasonable regulations as it may
prescribe, the Corporation shall provide for the registration of the Warrant
Certificates on the Corporation's records and transfers or exchanges of the
Warrant Certificates as herein provided.
(b) Restrictions on Transfer. (i) Each of NationsBank and its
Affiliates who are issued Warrants pursuant to this Warrant Agreement (A)
represents that it is acquiring the Warrants for its own account for
investment and not with a view to any distribution or public offering within
the meaning of the Securities Act, except in any case pursuant to the
registration of such Warrants or Warrant Shares under the Securities Act or
any state securities or "blue sky" laws or pursuant to a valid exemption from
such registration requirement, (B) acknowledges that the Warrants and the
Warrant Shares issuable upon exercise thereof have not been registered under
the Securities Act or any state securities or "blue sky" laws and (C) agrees
that it will not sell or otherwise transfer any of its Warrants or Warrant
Shares except upon the terms and conditions specified herein and that it will
cause any transferee thereof to agree to take and hold the same subject to
the terms and conditions specified herein, (D) acknowledges that any transfer
agent now or hereafter employed or utilized by the Corporation shall be
instructed not to effect transfer of the Warrants or the Warrant Shares
issuable upon exercise thereof without prior authorization from the
Corporation in accordance with the terms hereof (or, if the Corporation
serves as its own transfer agent, a notation shall be made in the
Corporation's records indicating the transfer restrictions to which the
Warrants and Warrant Shares issuable upon exercise thereof are subject and
that the Warrants and the Warrant Shares may only be transferable in
accordance with this Agreement); and (E) represents it (I) is an "accredited
investor" (as defined in Rule 501(a)(1) of Regulation D promulgated under the
Securities Act by the Commission);(II) has such knowledge and experience in
financial and business matters that it is capable of evaluating the merits
and risks of its investment in the Warrants and Warrant Shares issuable upon
exercise of the Warrants; (III) is able to bear the complete loss of its
investment in the Warrants and Warrant Shares issuable upon exercise of the
Warrants; (IV) has had the opportunity to ask questions of, and receive
answers from, the Corporation and its management concerning the
14
terms and conditions of the offering of the Warrants and Warrant Shares
issuable upon exercise of the Warrants and to obtain additional information;
and (V) is not relying upon any statements or instruments made or issued by
any person other than the Corporation in making its decision to invest in the
Warrants and Warrant Shares issuable upon exercise of the Warrants; and (ii)
each of NationsBank and its Affiliates who are issued Warrants pursuant to
this Agreement (A) is domiciled in North Carolina and received its offer to
purchase Warrants and Warrant Shares in North Carolina; (B) understands that
the Warrants and Warrant Shares issuable upon exercise of the Warrants will
be considered restricted securities within the meaning of Rule 144 under the
Securities Act; that Rule 144 may not be available for exemption from the
registration requirements of the Securities Act for the sale of such
restricted securities; that if Rule 144 is available, sales may be made in
reliance upon Rule 144 only in accordance with the terms and conditions of
Rule 144, which among other things generally requires that the securities be
held for at least one year and that the sales shall be made in limited
amounts; and that, if an exemption for such sales by such holder of the
Warrants or the Warrant Shares is not available, registration of the
securities may be required, but that the Corporation is under no obligation
to register the securities or to facilitate compliance or to comply with any
exemption except pursuant to Article 7 of this Agreement; and (C) agrees that
it will not sell, transfer, hypothecate, or otherwise dispose of any of the
Warrants and Warrant Shares issuable upon exercise of the Warrants, except in
compliance with the Securities Act and applicable securities laws.
(c) Right of First Refusal. Notwithstanding any other provision of
this Agreement, until the Corporation consummates a Qualified Initial Public
Offering, no assignment, transfer or sale of any Warrants or any Warrant
Shares (other than a sale to an Affiliate) shall be made except in compliance
with this Agreement and the following right of first refusal:
(i) If any Holder of Warrants or Warrant Shares (the "Selling
Warrant Holder") desires to dispose of any Warrants or Warrant Shares, (the
"Offered Warrant Securities"), except as otherwise permitted hereunder, such
Selling Warrant Holder shall first give written notice (the "Warrant
Securities Offer Notice") to the Corporation. A Warrant Securities Offer
Notice shall (A) indicate that such Selling Warrant Holder wishes to dispose
of the Offered Warrant Securities, and (B) state the price and other material
terms upon which such Selling Warrant Holder wishes to dispose of such
Warrant Securities and offer to sell the Offered Warrant Securities, in whole
(but not in part)(the "Warrant Securities Offer") at the price and on the
other material terms described in the Warrant Securities Offer Notice, first,
to the Corporation and/or its designees.
(ii) The Corporation and/or its designees may offer to accept a
Warrant Securities Offer in whole (but not in part) by giving notice to the
Selling Warrant Holder within thirty (30) days after the Warrant Securities
Offer Date. The closing of such sale of Offered Warrant Securities shall be
consummated within five (5) days after the date the Corporation's and/or its
designees' offer is accepted by the Selling Warrant Holder at the principal
office of the Corporation (or at such other times or places as such Selling
Warrant Holder and the Corporation and/or its designees may agree).
(iii) If the Offered Warrant Securities have not been accepted by
the Corporation and/or its designees in accordance with this Section 6.1(c),
the Selling Warrant Holder may dispose of the Offered Warrant Securities, to
one or more Persons who each agree in writing to be bound by the terms of
this Agreement, on substantially the same terms but not more favorable than
those stated
15
in the Warrant Securities Offer Notice, at any time up to one hundred (100)
days after the Warrant Securities Offer Date. Thereafter, the provisions of
this Section 6.1(c) will again apply.
(d) Notice of Transfer. Prior to or promptly after any assignment,
transfer or sale of the Warrants or any Warrant Shares, the Holder thereof
shall give written notice to the Corporation of such Holder's intention to
effect such assignment, transfer or sale, which notice shall set forth the
date of such proposed assignment, transfer or sale and identify of the
proposed transferee. Each Holder wishing to effect such a transfer of the
Warrants or any Warrant Shares shall also furnish to the Corporation an
agreement by the transferee thereof that it is taking and holding the same
subject to the terms and conditions specified herein and a written opinion
of such Holder's counsel, in form reasonably satisfactory to the Corporation,
to the effect that the proposed transfer may be effected without registration
under the Securities Act and applicable state securities laws.
(e) Legend. Except as provided in Section 6.1(f) hereof, each Warrant
Certificate and each certificate for the Warrant Shares issued to NationsBank
or an Affiliate thereof or to a subsequent transferee thereof pursuant to
Section 6.1(d) shall include the legend in substantially the form set forth
in Section 2.2; provided that such legend shall not be required if such
transfer is being made in connection with a sale which is exempt from
registration pursuant to Rule 144 under the Securities Act.
(f) Termination of Transfer Restrictions. The restrictions set forth in
Sections 6.1(b) through (e) shall terminate and cease to be effective (i) if
the Warrants or any Warrant Shares issuable upon exercise therof are
registered under the Securities Act and, in the case of Warrant Shares, when
such Warrant Shares are sold in reliance upon Rule 144 or (ii) on such
earlier date as of which the Corporation shall determine that such
restrictions are no longer required under applicable securities laws (and the
Corporation shall respond promptly, reasonably and in good faith to any
reasonable request that the Corporation make such a determination). Whenever
such restrictions shall so terminate the Holder of such Warrants and/or
Warrant Shares shall be entitled to receive from the Company, without expense
(other than transfer taxes and Florida documentary stamp tax, to the extent
applicable), a new Warrant Certificate(s) or certificates for such Warrant
Shares not bearing the legend set forth in Section 2.2 at which time the
Company shall rescind any transfer restrictions relating thereto.
ARTICLE 7
REGISTRATION RIGHTS
NationsBank (and its permitted transferees and assignees of this
Agreement) shall have and be entitled to exercise the rights of registration
granted to, and shall be subject to the obligations of, "Other
Stockholders" under the Registration Rights Agreement. As a condition
precedent thereto, NationsBank and each subsequent permitted transferee and
assignee shall execute and deliver to the Corporation and each other party
to the Registration Rights Agreement a counterpart signature page thereto.
16
ARTICLE 8
MISCELLANEOUS
8.1 Loss or Mutilation. Upon receipt by the Corporation of (a)
evidence satisfactory to it of the ownership, and the loss, theft,
destruction or mutilation, of any Warrant Certificate and (b) of indemnity
satisfactory to it or, in the case of mutilation, upon surrender and
cancellation of the mutilated Warrant Certificate, then, the Corporation
shall execute and deliver to the registered Holder of the lost, stolen,
destroyed or mutilated Warrant Certificate, in exchange for or in lieu
thereof, a new Warrant Certificate of the same tenor and for a like
aggregate number of Warrant Shares. Upon the issuance of any new Warrant
Certificate under this Section 8.1, the Corporation may require the payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and other expenses in connection therewith
including any transfer taxes and Florida documentary stamp tax. Every new
Warrant Certificate executed and delivered pursuant to this Section in lieu
of any lost, stolen or destroyed Warrant Certificate shall constitute a
contractual obligation of the Corporation, whether or not the allegedly lost,
stolen or destroyed Warrant Certificate shall be at any time enforceable by
anyone, and shall be entitled to the benefits of this Agreement. The
provisions of this Section 8.1 are exclusive and shall preclude (to the
extent lawful) all other rights or remedies with respect to the replacement of
the mutilated, lost, stolen, or destroyed Warrant Certificates.
8.2 Payment of Taxes. The Corporation shall pay any taxes and other
governmental charges that may be imposed on the Corporation under the laws of
the United States of America or any political subdivision or taxing authority
thereof or therein in respect of the issue or delivery of Warrant Shares or of
other securities or property deliverable upon exercise of the Warrants. The
Corporation shall not be required, however, to pay any tax or other charge
imposed in connection with any transfer involved in the issue of any
certificate for Warrant Shares or other securities or property issuable upon
the exercise of the Warrants or payment of cash to any person other than the
Holder of a Warrant Certificate surrendered upon exercise of the Warrants and
in case of such transfer or payment, the Corporation shall not be required to
issue any stock certificate or pay any cash until such tax or charge has been
paid or it has been established to the Corporation's satisfaction that no
such tax or charge is due.
8.3 Notices. Any notice, demand or delivery authorized by this
Agreement shall be in writing and shall be delivered by hand or overnight
courier service, mailed or set by facsimile as follows:
17
To the Corporation:
Vitas Healthcare Corporation
000 Xxxxx Xxxxxxxx Xxxxxxxxx
Xxxxx, Xxxxxxx 00000
Attention: Chief Executive Officer
Telephone No. (000) 000-0000
To NationsBank:
NationsBank, N.A.
Xxxxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Agency Services
Telecopy: (000) 000-0000
or such other address or telecopy number as shall have been furnished to the
party giving or making such notice, demand or delivery. Any notice that is
sent in a manner provided herein shall have been duly given when sent.
8.4 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE WITHOUT GIVING EFFECT TO
CONFLICTS OF LAW PRINCIPLES THEREOF.
8.5 Assignment; Successors. Subject to Section 6.1 hereof, this
Agreement may be assigned by NationsBank to any Affiliate at any time upon
written notice. This Agreement shall be binding upon and inure to the
benefit of the Corporation and the Holders and their respective successors
and assigns, and the Holders from time to time of the Warrants. Nothing in
this Agreement is intended or shall be construed to confer upon any person,
other than the Corporation and the Holders, any right, remedy or claim under
or by reason of this Agreement or any part hereof.
8.6 Counterparts. This Agreement may be executed manually or by
facsimile in any number of counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
8.7 Amendments. Any provision of this Agreement or the Warrant
Certificate may be amended or waived if, but only if, such amendment or
waiver is in writing and is signed by the Corporation and the Holders of a
majority in interest of the issued or issuable Warrant Shares; provided,
however, if any amendment adversely affects the Exercise Price or the number
of Warrant Shares issued upon exercise of any Warrant, then the Holders of
all the issued or issuable Warrant Shares must sign the document.
18
8.8 Headings. The descriptive headings of the several Sections of this
Agreement are inserted for convenience only and shall not control or affect
the meaning or construction of any of the provisions hereof.
8.9 Third Party Beneficiaries. The Holders shall be third party
beneficiaries to the agreements made hereunder between the Corporation, on
the one hand, and NationsBank, on the other hand, and the Holders shall have
the right to enforce such agreements directly to the extent it deems such
enforcement necessary or advisable to protect its rights or the rights of the
Holder hereunder.
8.10 Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstances is held
invalid, illegal or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions hereof shall not be in any way
impaired or affected thereby, it being intended that all of the rights and
privileges of the parties shall be enforceable to the fullest extent
permitted by law.
8.11 No Inconsistent Agreements. Except as set forth in the
Registration Rights Agreement, the Corporation has not, as of the date
hereof, entered into, nor shall it, on or after the date hereof, enter into,
any agreement that is inconsistent with the rights granted to the Holders
herein or that otherwise conflicts with the provisions hereof.
19
IN WITNESS WHEREOF, the parties have caused this Agreement to be
duly executed and delivered, as of the date first above written.
VITAS HEALTHCARE CORPORATION
By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Chairman and Chief Executive Officer
NATIONSBANK, N.A.
By: /s/ Xxxxxxx Xxxxxxxx
------------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Senior Vice President
20
EXHIBIT A
WARRANT CERTIFICATE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS
AND CONDITIONS OF A CERTAIN AGREEMENT WHICH INCLUDES A RIGHT OF FIRST REFUSAL
ON THE SALE OF THE SECURITIES. COPIES OF THE AGREEMENT MAY BE OBTAINED UPON
WRITTEN REQUEST TO THE SECRETARY OF THE CORPORATION.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE
SECURITIES LAWS AND CANNOT BE OFFERED, SOLD OR TRANSFERRED WITHOUT
REGISTRATION OR COMPLIANCE WITH EXEMPTION FROM REGISTRATION UNDER THE ACT AND
APPLICABLE STATE SECURITIES LAWS AND REGULATIONS PROMULGATED THEREUNDER.
A full statement of the powers, designations, preferences and relative,
participating, optional or other special rights of the shares of each class
of stock of the Corporation authorized to be issued, and the qualifications,
limitations or restrictions of such preferences and/or rights, will be
furnished to any stockholder without charge upon request to the Secretary of
the Corporation.
No.1 Warrants to purchase an aggregate
of 291,918 shares of Common Stock
WARRANT TO PURCHASE COMMON STOCK
This certifies that NationsBank, N.A. or its permitted assigns, is the
holder of 291,918 Warrants to purchase shares of Common Stock ("Common
Stock") of Vitas Healthcare Corporation (the "Corporation"). Each Warrant
initially entitles the holder thereof (the "Holder") to purchase from the
Corporation one (1) share of Common Stock at the purchase price (the
"Exercise Price") set forth in the Warrant Agreement (as defined below),
subject to the terms and conditions hereof and of the Warrant Agreement. In
order to exercise the Warrants represented by this Warrant Certificate, the
registered Holder hereof must surrender this Warrant Certificate at the
office of Corporation as set forth in the Warrant Agreement or to its
successor.
This Warrant Certificate is issued under and in accordance with a
Warrant Agreement dated as of September 1, 1997 by and between NationsBank,
N.A. and the Corporation (the "Warrant Agreement"), and is subject to the
terms and provisions contained therein, 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
description of the rights, limitations of rights, obligations, duties and
immunities thereunder of the Corporation and the Holder of the Warrants. The
summary or the terms of the Warrant Agreement contained in this Warrant
21
qualified in its entirety by express reference to the Warrant Agreement. All
terms used in this Warrant Certificate that are defined in the Warrant
Agreement shall have the meanings assigned to them in the Warrant Agreement.
Copies of the Warrant Agreement are on file at the office of the
Corporation and may be obtained by writing to the Corporation requesting the
same.
The number of shares of Common Stock purchasable upon the exercise of
the Warrants and the Exercise Price are subject to adjustment as provided in
the Warrant Agreement.
Subject to the requirements set forth in the Warrant Agreement and the
restrictions on transfer set forth therein, this Warrant Certificate and all
rights hereunder shall be transferable by the registered Holder hereof on the
register of the Corporation maintained by the Corporation for such purpose at
its office upon surrender of this Warrant Certificate duly endorsed, or
accompanied by a written instrument of transfer in form satisfactory to the
Corporation duly executed, by the registered Holder hereof or such Holder's
attorney duly authorized in writing and upon payment of any necessary
transfer tax or other governmental charge imposed upon such transfer. Upon
any partial transfer the Corporation will issue and deliver to such Holder a
new Warrant Certificate with respect to any portion not so transferred.
This Warrant Certificate shall be void and all rights evidenced hereby
shall cease on the Expiration Date unless otherwise provided in the Warrant
Agreement.
22
This Warrant Certificate and the Warrant Agreement are subject to
amendment as provided in the Warrant Agreement.
Dated: __________, 1997
VITAS HEALTHCARE CORPORATION
By:
-------------------------------------------
Name:
Title: Chairman and Chief Executive Officer
23
EXHIBIT B
Notice of Intention to Exercise Warrant for Cash
------------------------------------------------
The undersigned holder of the attached Warrant Certificate hereby
exercises the right to exchange the attached Warrant Certificate for the
number of shares of Common Stock of Vitas Healthcare Corporation shown below
in accordance with the terms thereof and directs that (i) such shares be
issued and delivered to the undersigned as provided by the terms of the
attached Warrant Certificate, and (ii) a certificate representing the number
of shares covered by the attached Warrant Certificate which shall thereafter
remain unexercised, if any, also be delivered to the undersigned. This notice
is accompanied by the Aggregate Purchase price shown below.
1. Number of shares as to which exercised:
-----------------------------
AND
2. Aggregate Purchase Price:
-------------------------------------------
-------------------------------------------
(Signature of Holder)
EXHIBIT C
Notice of Intention to Exercise Warrant by Conversion
The undersigned holder of the attached Warrant Certificate hereby
irrevocably elects to exercise the right, represented by the attached Warrant
Certificate, to convert Warrants represented thereby into ____ shares of
Common Stock of Vitas Healthcare Corporation and directs that (i) such shares
be issued and delivered to the undersigned as provided by the terms of the
attached Warrant Certificate, and (ii) a certificate representing the number
of shares covered by the attached Warrant Certificate which shall thereafter
remain unexercised, if any, also be delivered to the undersigned.
---------------------------------
(Signature of Holder)
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered, as of the date first above written.
VITAS HEALTHCARE CORPORATION
By: /s/ Xxxx X. Xxxxxxxxx
------------------------
Name:
Title: Chairman and Chief Executive Officer
NATIONSBANK, N.A.
By:
-------------------------
Name:
Title: Senior Vice President
