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EXHIBIT 10.20
EXECUTION COPY
WARRANT AGREEMENT
Dated as of
November 14, 0000
xxxxxxx
XXXXXXXXXXXXX XX XXXXXXX, INC.
and
STATE STREET BANK AND TRUST COMPANY,
as Warrant Agent
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Warrants for
Common Stock of
TravelCenters of America, Inc.
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TABLE OF CONTENTS
ARTICLE I Page
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Definition
SECTION 1.01. Definitions............................................ 2
SECTION 1.02. Other Definitions...................................... 6
SECTION 1.03. Rules of Construction.................................. 7
ARTICLE II
Warrant Certificates
SECTION 2.01. Form and Dating........................................ 7
SECTION 2.02. Execution and Countersignature......................... 9
SECTION 2.03. Certificate Register................................... 10
SECTION 2.04. Transfer and Exchange.................................. 10
SECTION 2.05. Certificated Warrants.................................. 16
SECTION 2.06. Replacement Certificates............................... 16
SECTION 2.07. Outstanding Warrants................................... 17
SECTION 2.08. Cancellation........................................... 17
SECTION 2.09. CUSIP Numbers.......................................... 17
SECTION 2.10. Distribution of Contingent ............................ 18
ARTICLE III
Exercise Terms
SECTION 3.01. Exercise............................................... 18
SECTION 3.02. Exercise Periods....................................... 18
SECTION 3.03. Expiration............................................. 19
SECTION 3.04. Manner of Exercise..................................... 19
SECTION 3.05. Issuance of Warrant Shares............................. 20
SECTION 3.06. Fractional Warrant Shares.............................. 21
SECTION 3.07. Reservation of Warrant Shares.......................... 21
SECTION 3.08. Compliance with Law.................................... 22
ARTICLE IV
Antidilution Provisions
SECTION 4.01. Changes in Common Stock................................ 22
SECTION 4.02. Cash Dividends and Other Distributions................. 23
SECTION 4.03. Common Stock Issue..................................... 24
SECTION 4.04. Issuance of Rights or Options.......................... 25
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SECTION 4.05. Combination; Liquidation........................... 26
SECTION 4.06. Other Events....................................... 27
SECTION 4.07. Superseding Adjustment............................. 27
SECTION 4.08. Minimum Adjustment................................. 28
SECTION 4.09. Notice of Adjustment............................... 28
SECTION 4.10. Notice of Certain Transactions..................... 29
SECTION 4.11. Adjustment to Warrant Certificate.................. 30
ARTICLE V
Registration Rights; Indemnification
SECTION 5.01. Effectiveness of Registration Statement............ 30
SECTION 5.02. Suspension......................................... 32
SECTION 5.03. Blue Sky........................................... 33
SECTION 5.04. Accuracy of Disclosure............................. 33
SECTION 5.05. Indemnification.................................... 34
SECTION 5.06. Additional Acts.................................... 38
SECTION 5.07. Expenses........................................... 38
ARTICLE VI
Warrant Agent
SECTION 6.01. Appointment of Warrant Agent....................... 39
SECTION 6.02. Rights and Duties of Warrant Agent................. 39
SECTION 6.03. Individual Rights of Warrant Agent................. 40
SECTION 6.04. Warrant Agent's Disclaimer......................... 41
SECTION 6.05. Compensation and Indemnity......................... 41
SECTION 6.06. Successor Warrant Agent............................ 41
ARTICLE VII
Miscellaneous
SECTION 7.01. SEC Reports........................................ 43
SECTION 7.02. Persons Benefitting................................ 44
SECTION 7.03. Rights of Holders.................................. 44
SECTION 7.04. Amendment.......................................... 44
SECTION 7.05. Notices............................................ 45
SECTION 7.06. Governing Law...................................... 46
SECTION 7.07. Successors......................................... 46
SECTION 7.08. Multiple Originals................................. 46
SECTION 7.09. Table of Contents.................................. 46
SECTION 7.10. Severability....................................... 46
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Appendix A
EXHIBIT A Form of Face of Warrant Certificate
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WARRANT AGREEMENT dated as of November 14,
2000 (this "Agreement"), between TRAVELCENTERS OF
AMERICA, INC., a Delaware corporation (the
"Company"), and STATE STREET BANK AND TRUST COMPANY,
a Massachusetts trust company, as Warrant Agent (the
"Warrant Agent").
The Company desires to issue the warrants described herein.
The Warrants (as defined herein) will initially entitle the holders thereof (the
"Holders") to purchase, in the aggregate, 277,165 shares of Common Stock, par
value $0.00001 per share, of the Company ("Common Stock") in connection with an
offering (the "Offering") by the Company of 190,000 units (the "Units"). Each
Unit consists of (i) one 12 3/4% Senior Subordinated Note Due May 1, 2009 in a
principal amount of $1,000 (a "Note"), (ii) three initial warrants (each an
"Initial Warrant") to purchase 0.36469 shares of Common Stock and (iii) one
contingent warrant (a "Contingent Warrant" and, together with the Initial
Warrants, the "Warrants") to purchase 0.36469 shares of Common Stock. In
connection with the sale of the Units, 570,000 Initial Warrants will be issued
to the purchasers of the Units and 190,000 Contingent Warrants will be issued
and placed into escrow pursuant to the terms of an escrow agreement, dated as of
the date hereof (the "Contingent Warrant Escrow Agreement"), between the Company
and State Street Bank and Trust Company as escrow agent (the "Warrant Escrow
Agent").
The Warrants will not trade separately from the Notes until
the earliest date (the "Separation Date") to occur of: (i) the commencement of a
registered exchange offer for the Notes, (ii) the effective date of a shelf
registration statement with respect to the Notes and (iii) such earlier date
after December 14, 2000, as may be determined by the Initial Purchasers (as
defined herein). The Contingent Warrants will not trade separately from the
Initial Warrants unless and until released from escrow on the Contingent Warrant
Release Date to the registered holders of the Initial Warrants.
The Company further desires the Warrant Agent to act on behalf
of the Company in connection with the issuance of the Warrants as provided
herein and the Warrant Agent is willing to so act.
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Each party agrees as follows for the benefit of the other
party and for the equal and ratable benefit of the Holders of Warrants:
ARTICLE I
Definitions
SECTION 1.01. Definitions.
"Affiliate" of any Person means (i) any other Person which,
directly or indirectly, is in control of, is controlled by or is under common
control with such Person, or (ii) any other Person who is a director or
executive officer (A) of such Person, (B) of any subsidiary of such Person or
(C) of any Person described in clause (i) above. For purposes hereof, (a)
"control" of a Person means the power, direct or indirect, to direct or cause
the direction of the management and policies of such Person whether by contract
or otherwise and (b) beneficial ownership of 10% or more of the voting common
equity (on a fully diluted basis) or warrants to purchase such equity (whether
or not currently exercisable) of a Person shall be deemed to be in control of
such Person; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Board" means the Board of Directors of the Company or any
committee thereof duly authorized to act on behalf of such Board of Directors.
"Business Day" means each day that is not a Saturday, a Sunday
or a day on which banking institutions are not required to be open in the State
of New York.
"Capital Stock" of any Person means any and all shares,
interests, rights to purchase, warrants, options, participations or other
equivalents of or interests in (however designated) equity of such Person,
including any Preferred Stock, but excluding any debt securities convertible
into such equity.
"Cashless Exercise Ratio" means a fraction, the numerator of
which is the excess of the Current Market Value per share of Common Stock on the
Exercise Date over the Exercise Price per share as of the Exercise Date and the
denominator of which is the Current Market Value per share of the Common Stock
on the Exercise Date.
"Certificated Warrants" means certificated Warrants in fully
registered definitive form.
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"Combination" means an event in which the Company consolidates
with, merges with or into, or sells all or substantially all of its assets to,
another Person.
"Consolidated Leverage Ratio" will have the same meaning as
when used in the Indenture, will be determined in accordance with the provisions
of the Indenture and will apply to TravelCenters of America, Inc. or any person
that would constitute a Successor Company under the Indenture (in each case,
however, without giving effect to any amendments thereto).
"Contingent Warrant Release Date" means March 31, 2003.
"Current Market Value" per share of Common Stock or any other
security at any date means (i) if the security is not registered under the
Exchange Act, (a) the value of the security, determined in good faith by the
Board and certified in a board resolution, based on the most recently completed
arm's-length transaction between the Company and a Person other than an
Affiliate of the Company, the closing of which shall have occurred on such date
or within the six-month period preceding such date, or (b) if no such
transaction shall have occurred on such date or within such six-month period,
the value of the security as determined by an independent financial expert or
(ii) if the security is registered under the Exchange Act, the average of the
daily closing bid prices (or the equivalent in an over-the-counter market) for
each Business Day during the period commencing 15 Business Days before such date
and ending on the date one day prior to such date, or if the security has been
registered under the Exchange Act for less than 15 consecutive Business Days
before such date, then the average of the daily closing bid prices (or such
equivalent) for all of the Business Days before such date for which daily
closing bid prices are available; provided, however, that if the closing bid
price is not determinable for at least ten Business Days in such period, the
"Current Market Value" of the security shall be determined as if the security
were not registered under the Exchange Act.
"Depository" means The Depository Trust Company, its nominees
and their respective successors.
"Exchange Act" means the U.S. Securities Exchange Act of 1934,
as amended.
"Exercise Date" means, for a given Warrant, the day on which
such Warrant is exercised pursuant to Section 3.04.
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"Extraordinary Cash Dividend" means that portion, if any, of
the aggregate amount of all dividends paid by the Company on the Common Stock in
any fiscal year that exceeds $10 million.
"Indenture" means the Indenture dated as of November 14, 2000,
among the Company, the Subsidiary Guarantors named therein and the Trustee, with
respect to the Notes, as it may be amended or supplemented from time to time.
"Initial Purchasers" means Credit Suisse First Boston
Corporation, Chase Securities Inc. and Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
Corporation.
"Issue Date" means the date on which the Warrants are
initially issued.
"Offering Circular" means the Confidential Offering Circular
dated November 9, 2000, of the Company with respect to the Units.
"Officer" means the Chairman of the Board, the President, any
Vice President, the Treasurer, or an Assistant Treasurer, or the Secretary or an
Assistant Secretary of the Company.
"Officers' Certificate" means a certificate signed by two
Officers.
"Opinion of Counsel" means a written opinion from legal
counsel who is reasonably acceptable to the Warrant Agent. Such counsel may be
an employee of or counsel to the Company or the Warrant Agent.
"Person" means any individual, corporation, partnership, joint
venture, limited liability company, joint venture, association, joint-stock
company, trust, unincorporated organization, government or any agency or
political subdivision thereof or any other entity.
"Preferred Stock", as applied to the Capital Stock of any
Person, means Capital Stock of any class or classes (however designated) which
is preferred as to the payment of dividends or distributions, or as to the
payment of assets upon any voluntary or involuntary liquidation or dissolution
of such Person, over shares of Capital Stock of any other class of such Person.
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"Purchase Agreement" means the Purchase Agreement dated
November 9, 2000, among the Company, the Subsidiary Guarantors named therein and
the Initial Purchasers.
"QIB" means a "qualified institutional buyer" as defined in
Rule 144A.
"Regulation S" means Regulation S under the Securities Act.
"Regulation S Restricted Warrant" means (i) each Initial
Warrant initially sold under Regulation S unless such Warrant has been resold
pursuant to an effective registration statement under the Securities Act,
pursuant to Rule 144A under the Securities Act or pursuant to Rule 144(k) under
the Securities Act and (ii) each Contingent Warrant delivered to a Holder of any
Initial Warrant described in clause (i).
"Release Event" means the release of the Contingent Warrants
from the escrow arrangements created by the Contingent Warrant Escrow Agreement
and distribution of the Contingent Warrants to holders of the Initial Warrants
as provided for in this Agreement and the Contingent Warrant Escrow Agreement.
"Rule 144A" means Rule 144A under the Securities Act.
"SEC" means the Securities and Exchange Commission.
"Securities" means the Warrants and the Warrant Shares.
"Securities Act" means the U.S. Securities Act of 1933, as
amended.
"Transfer Restricted Securities" means the Warrants and the
Common Stock which may be issued to Holders upon exercise of the Warrants,
whether or not such exercise has been effected. Each such security shall cease
to be a Transfer Restricted Security when (i) it has been disposed of pursuant
to a registration statement of the Company filed with the SEC and declared
effective by the SEC that covers the disposition of such Transfer Restricted
Security, (ii) it has been distributed pursuant to Rule 144 promulgated under
the Securities Act (or any similar provisions under the Securities Act then in
effect) or (iii) it may be resold without registration under the
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Securities Act, whether pursuant to Rule 144(k) under the Securities Act or
otherwise.
"Trustee" means State Street Bank and Trust Company, or any
successor trustee under the Indenture.
"Warrant Certificates" mean the registered certificates
(including the Global Warrants) issued by the Company under this Agreement
representing the Warrants.
"Warrant Custodian" means the custodian with respect to a
Global Warrant (as appointed by the Depository) or any successor person thereto
and shall initially be the Warrant Agent.
"Warrant Shares" mean the shares of Common Stock (and any
other securities) for which the Warrants are exercisable or which have been
issued upon exercise of Warrants.
SECTION 1.02. Other Definitions.
Defined in
Term Section
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"Agreement"................................................................... Recitals
"Agent Members"............................................................... 2.01(b)
"Cashless Exercise"........................................................... 3.04
"Certificate Register"........................................................ 2.03
"Common Shelf Registration Statement"......................................... 5.01
"Common Stock"................................................................ Recitals
"Company"..................................................................... Recitals
"Contingent Warrant Escrow Agreement"......................................... Recitals
"Contingent Warrants"......................................................... Recitals
"Definitive Warrant".......................................................... 2.01(c)
"Exercise Price".............................................................. 3.01
"Expiration Date"............................................................. 3.02(b)
"Global Warrant".............................................................. 2.01(a)
"Holders"..................................................................... Recitals
"Indemnified Parties"......................................................... 5.05(a)
"Initial Warrants"............................................................ Recitals
"Offering".................................................................... Recitals
"Registration Statement"...................................................... 5.01
"Regulation S Global Warrants"................................................ 2.01(a)
"Rule 144A Global Warrants"................................................... 2.01(a)
"Separability Legend"......................................................... 2.04(e)
"Separation Date"............................................................. Recitals
"Stock Transfer Agent"........................................................ 3.05
"Successor Company"........................................................... 4.05(a)
"Suspension Period"........................................................... 5.02
"Units"....................................................................... Recitals
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Defined in
Term Section
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"Warrant Escrow Agent"........................................................ Recitals
"Warrants".................................................................... Recitals
"Warrant Agent"............................................................... Recitals
"Warrant Shelf Registration Statement"........................................ 5.01
SECTION 1.03. Rules of Construction. Unless the text otherwise
requires:
(i) a defined term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting
principles as in effect on the date hereof;
(iii) "or" is not exclusive;
(iv) "including" means including, without limitation; and
(v) words in the singular include the plural and words in the
plural include the singular.
ARTICLE II
Warrant Certificates
SECTION 2.01. Form and Dating. The Warrants shall be offered
and sold by the Company pursuant to the Purchase Agreement. Each Warrant shall
initially be issued as part of a Unit consisting of one Note, three Initial
Warrants and one Contingent Warrant. Prior to the Separation Date, the Warrants
may not be transferred or exchanged separately from, but may be transferred or
exchanged only together with, the Notes attached to such Warrants. Prior to the
Separation Date, the transfer agent for the Notes (the "Note Transfer Agent")
shall act as transfer agent for both the Warrants and the Notes. Any request for
transfer of a Warrant prior to the Separation Date made to the Note Transfer
Agent shall be accompanied by the Note attached thereto and the Note Transfer
Agent will not execute any such transfer without such Note attached thereto.
Such Warrant and Note will be duly endorsed and accompanied by a written
instrument of transfer in form satisfactory to the Company, duly executed by the
Holder thereof or the Holder's attorneys duly authorized in writing. In the
event of the commencement of a registered
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exchange offer for the Notes or the effectiveness of a shelf registration
statement with respect to the Notes, the Company shall provide notice to the
Note Transfer Agent and the Warrant Agent of the Separation Date not less than
two Business Days prior to such date and the Company will cause the Note
Transfer Agent to notify the Depository of such date. In the event of a
determination by the Initial Purchasers to separate the Warrants and the Notes,
the Company shall promptly, but in no event later than the next following
Business Day after receiving notice of such determination, provide notice to the
Note Transfer Agent and the Warrant Agent of the Separation Date and cause the
Note Transfer Agent to notify the Depository of such date. In acting as the
transfer agent for the Warrants prior to the Separation Date, the Note Transfer
Agent shall be entitled to all the rights, privileges and immunities to which
the Warrant Agent is entitled in performing such role pursuant to the terms of
this Agreement.
(a) Global Warrants. Warrants offered and sold to QIBs in
reliance on Rule 144A ("Rule 144A Global Warrants") and Warrants offered and
sold to non-U.S. persons (as defined in Regulation S) in reliance on Regulation
S ("Regulation S Global Warrants"), each as provided in the Purchase Agreement,
shall be issued initially in the form of one or more permanent global Initial
Warrants (an "Initial Global Warrant") and global Contingent Warrants (a
"Contingent Global Warrant"), as the case may be, in definitive, fully
registered form with the global securities legend and restricted securities
legend set forth in Exhibit A hereto (each, a "Global Warrant"), which shall be
deposited on behalf of the Initial Purchasers with, subject to the first
paragraph of this Section 2.01, the Warrant Agent, as custodian for the
Depository (or with such other custodian as the Depository may direct), and
registered in the name of the Depository or a nominee of the Depository, duly
executed by the Company and countersigned by the Warrant Agent as hereinafter
provided.
(b) Book-Entry Provisions. (i) This Section 2.01(b) shall
apply only to a Global Warrant deposited with or on behalf of the Depository.
The Company shall execute and the Warrant Agent shall, in
accordance with Section 2.02, countersign and deliver initially one or more
Initial Global Warrants and Contingent Global Warrants that (a) shall be
registered in the name of the Depository for such Global Warrant or Global
Warrants or the nominee of the Depository and (b) shall be delivered by the
Warrant Agent to the Depository or pursuant
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to the Depository's instructions or held by the Warrant Agent as custodian for
the Depository.
(ii) Members of, or participants in, the Depository ("Agent
Members") shall have no rights under this Agreement with respect to any Global
Warrant held on their behalf by the Depository or by the Warrant Agent as the
custodian of the Depository or under such Global Warrant, and the Depository may
be treated by the Company, the Warrant Agent and any agent of the Company or the
Warrant Agent as the absolute owner of such Global Warrant for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the
Company, the Warrant Agent or any agent of the Company or the Warrant Agent from
giving effect to any written certification, proxy or other authorization
furnished by the Depository or impair, as between the Depository and its Agent
Members, the operation of customary practices of the Depository governing the
exercise of the rights of a holder of a beneficial interest in any Global
Warrant.
(c) Certificated Securities. Except as provided in Section
2.04 or 2.05, owners of beneficial interests in Global Warrants will not be
entitled to receive physical delivery of certificated Warrants.
SECTION 2.02. Execution and Countersignature. Two Officers
shall sign the Warrant Certificates for the Company by manual or facsimile
signature.
If an Officer whose signature is on a Warrant Certificate no
longer holds that office at the time the Warrant Agent countersigns the Warrant
Certificate, the Warrants evidenced by such Warrant Certificate shall be valid
nevertheless.
The Warrant Agent shall initially countersign and deliver
Warrant Certificates entitling the Holders thereof to purchase in the aggregate
not more than 277,165 Warrant Shares (consisting of 207,874 Warrant Shares
issuable upon exercise of the Initial Warrants and 69,291 Warrant Shares
issuable upon exercise of the Contingent Warrants) upon a written order of the
Company signed by two Officers of the Company.
The Warrant Agent may appoint an agent reasonably acceptable
to the Company to countersign the Warrant Certificates. Unless limited by the
terms of such appointment, such agent may countersign Warrant Certificates
whenever the Warrant Agent may do so. Each reference in this Agreement to
countersignature by the Warrant Agent
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includes countersignature by such agent. Such agent will have the same rights as
the Warrant Agent for service of notices and demands.
At any time and from time to time after the execution of this
Agreement, the Warrant Agent or an agent reasonably acceptable to the Company
shall upon receipt of a written order of the Company signed by two Officers of
the Company manually countersign for original issue a Warrant Certificate
evidencing the number of Warrants specified in such order; provided, however,
that the Warrant Agent shall be entitled to receive an Officers' Certificate and
an Opinion of Counsel of the Company that it may reasonably request in
connection with such countersignature of Warrants. Such order shall specify the
number of Warrants to be evidenced on the Warrant Certificate to be counter
signed, the date on which such Warrant Certificate is to be countersigned and
the number of Warrants then authorized.
The Warrants evidenced by a Warrant Certificate shall not be
valid until an authorized signatory of the Warrant Agent or its agent as
provided above manually countersigns the Warrant Certificate. The signature
shall be conclusive evidence that the Warrant Certificate has been countersigned
under this Agreement.
SECTION 2.03. Certificate Register. The Warrant Agent shall
keep a register ("Certificate Register") of the Warrant Certificates and of
their transfer and exchange. The Certificate Register shall show the names and
addresses of the respective Holders and the date and number of Warrants
evidenced on the face of each of the Warrant Certificates. The Company and the
Warrant Agent may deem and treat the Person in whose name a Warrant Certificate
is registered as the absolute owner of such Warrant Certificate for all purposes
whatsoever and neither the Company nor the Warrant Agent shall be affected by
notice to the contrary.
SECTION 2.04. Transfer and Exchange.
(a) Transfer and Exchange of Global Warrants.
(i) The transfer and exchange of Global Warrants or beneficial
interests therein shall be effected through the Depository, in
accordance with this Agreement (including applicable restrictions on
transfer set forth herein) and the procedures of the Depository
therefor. A transferor of a beneficial interest in a Global Warrant
shall deliver to the Warrant Agent a written order given in accordance
with the Depository's procedures containing information
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regarding the participant account of the Depository to be credited with
a beneficial interest in the Global Warrant. The Warrant Agent shall,
in accordance with such instructions, instruct the Depository to credit
to the account of the Person specified in such instructions a
beneficial interest in the Global Warrant and to debit the account of
the Person making the transfer of the beneficial interest in the Global
Warrant being transferred.
(ii) If the proposed transfer is a transfer of a beneficial
interest in a Rule 144A Global Warrant under Regulation S or a
beneficial interest in a Regulation S Global Warrant pursuant to Rule
144A, the Warrant Agent shall reflect on the Certificate Register the
date and an increase in the amount of the Regulation S Global Warrant
or the Rule 000X Xxxxxx Xxxxxxx, as applicable, in an amount equal to
the amount of the interest to be so transferred, and the Warrant Agent
shall reflect on the Certificate Register the date and a corresponding
decrease in the amount of the Rule 000X Xxxxxx Xxxxxxx or Regulation S
Global Warrant, as applicable; provided, however that the transfer is
in accordance with the certification requirements set forth on the
reverse of the Warrants and with such other procedures as may from time
to time be adopted by the Company.
(iii) Notwithstanding any other provisions of this Agreement
(other than the provisions set forth in Section 2.05), a Global Warrant
may not be transferred as a whole except by the Depository to a nominee
of the Depository or by a nominee of the Depository to the Depository
or another nominee of the Depository or by the Depository or any such
nominee to a successor Depository or a nominee of such successor
Depository.
(iv) In the event that a Global Warrant is exchanged and
transferred for Warrants in definitive registered form pursuant to
Section 2.05, prior to the effectiveness of a Warrant Shelf
Registration Statement with respect to such Warrants, such Warrants may
be exchanged only in accordance with such procedures as are
substantially consistent with the provisions of this Section 2.04
(including the certification requirements set forth on the reverse of
the Warrants intended to ensure that such transfers comply with Rule
144A or Regulation S, as the case may be) and such other procedures as
may from time to time be adopted by the Company.
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(b) Legend. (i) Except as permitted by the following
paragraphs (ii) and (iii), and to the extent permitted by applicable law, each
Warrant Certificate evidencing the Global Warrants (and all Warrants and Warrant
Shares issued in exchange therefor or in substitution thereof) shall bear a
legend in substantially the following form:
"THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND
THIS SECURITY MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS
SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION
5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE
COMPANY THAT (A) THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED
OR OTHERWISE TRANSFERRED ONLY (I) TO THE COMPANY, (II) INSIDE
THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 144A, (III) OUTSIDE THE UNITED STATES
IN A TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE
SECURITIES ACT, (IV) PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE), (V) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR, IN EACH OF
CASES (I) THROUGH (V) IN ACCORDANCE WITH ANY APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER
APPLICABLE JURISDICTION, AND (B) THE HOLDER WILL, AND EACH
SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS
SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A)
ABOVE.
HEDGING TRANSACTIONS INVOLVING THE WARRANTS OR THE COMMON
STOCK UNDERLYING THE WARRANT MAY NOT BE CONDUCTED UNLESS IN
COMPLIANCE WITH THE SECURITIES ACT AND THE RULES AND
REGULATIONS ISSUED THEREUNDER.
THIS WARRANTS EVIDENCED BY THIS SECURITY AND THE
COMMON STOCK TO BE ISSUED UPON THEIR EXERCISE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT AND
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MAY NOT BE EXERCISED UNLESS REGISTERED UNDER THE
SECURITIES ACT.
Each Warrant Certificate issued prior to the Separation Date
will also bear the following legend (the "Separability Legend"):
"THE WARRANTS EVIDENCED BY THIS CERTIFICATE WERE INITIALLY
ISSUED AS PART OF AN ISSUANCE OF UNITS, EACH OF WHICH CONSISTS
OF ONE 12 3/4% SENIOR SUBORDINATED NOTE DUE MAY 1, 0000 XX
XXXXXXXXXXXXX XX XXXXXXX, INC. (THE "COMPANY") IN A PRINCIPAL
AMOUNT OF $1,000 (A "NOTE"), THREE INITIAL WARRANTS AND ONE
CONTINGENT WARRANT (COLLECTIVELY, THE "WARRANTS"), EACH SUCH
WARRANT TO PURCHASE 0.36469 SHARES OF COMMON STOCK, PAR VALUE
$.00001 PER SHARE, OF THE COMPANY. THE NOTES AND WARRANTS WILL
NOT TRADE SEPARATELY UNTIL THE EARLIEST OF (I) THE
COMMENCEMENT OF A REGISTERED EXCHANGE OFFER FOR THE NOTES,
(II) THE EFFECTIVENESS OF A SHELF REGISTRATION STATEMENT WITH
RESPECT TO THE NOTES AND (III) SUCH EARLIER DATE AFTER
DECEMBER 14, 2000, AS THE INITIAL PURCHASERS MAY DETERMINE."
(ii) Upon any sale or transfer of a Transfer Restricted
Security (including any Transfer Restricted Security represented by a
Global Warrant) pursuant to Rule 144 under the Securities Act, the
Warrant Agent shall permit the Holder thereof to exchange such Transfer
Restricted Security for a certificated Warrant that does not bear the
legends set forth above (other than the Separability Legend, if
applicable) and rescind any restriction on the transfer of such
Transfer Restricted Security, if the Holder certifies in writing to the
Warrant Agent that its request for such exchange was made in reliance
on Rule 144 (such certification to be in the form set forth on the
reverse of the Warrant).
(iii) After a transfer of any Warrants during the period of
the effectiveness of a Warrant Shelf Registration Statement with
respect to such Warrants, all requirements pertaining to legends on
such Warrant will cease to apply, the requirements requiring any such
Warrant issued to certain Holders to be issued in global form will
cease to apply, and a certificated Warrant without legends will be
available to the transferee of the Holder of such Warrants upon
exchange of such transferring Holder's certificated Warrant or
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directions to transfer such Holder's interest in the Global Warrant, as
applicable.
(iv) On or after the Separation Date, the Holder of a Warrant
Certificate containing a Separability Legend may surrender such Warrant
Certificate accompanied by a written application to the Warrant Agent,
duly executed by the Holder thereof, for a new Warrant Certificate or
certificates not containing the Separability Legend.
(f) Cancellation or Adjustment of Global Warrant. At such time
as all beneficial interests in a Global Warrant have been exchanged for
certificated Warrants, redeemed, repurchased or canceled, such Global Warrant
shall be returned to the Depository for cancellation or retained and canceled by
the Warrant Agent. At any time prior to such cancellation, if any beneficial
interest in a Global Warrant is exchanged for certificated Warrants, redeemed,
repurchased or canceled, the number of Warrants represented by such Global
Warrant shall be reduced and an adjustment shall be made on the books and
records of the Warrant Agent (if it is then the Warrant Custodian for such
Global Warrant) with respect to such Global Warrant, by the Warrant Agent, to
reflect such reduction.
(g) Obligations with Respect to Transfers and Exchanges of
Warrants.
(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Warrant Agent shall countersign
certificated Warrants and Global Warrants as required pursuant to the
provisions of Section 2.02 and this Section 2.04.
(ii) No service charge shall be made to a Holder for any
registration of transfer or exchange, but the Company may require
payment of a sum sufficient to cover any transfer tax, assessments, or
similar governmental charge payable in connection therewith.
(iii) Prior to the due presentation for registration of
transfer of any Warrant, the Company and the Warrant Agent may deem and
treat the Person in whose name a Warrant is registered as the absolute
owner of such Warrant, and neither the Company nor the Warrant Agent
shall be affected by notice to the contrary.
(iv) All Warrants issued upon any transfer or exchange
pursuant to the terms of this Agreement shall be the valid obligations
of the Company, entitled to
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the same benefits under this Agreement as the Warrants surrendered upon
such transfer or exchange.
(h) No Obligation of the Warrant Agent.
(i) The Warrant Agent shall have no responsibility or
obligation to any beneficial owner of a Global Warrant, a member of, or
a participant in the Depository or other Person with respect to the
accuracy of the records of the Depository or its nominee or of any
participant or member thereof, with respect to any ownership interest
in the Warrants or with respect to the delivery to any participant,
member, beneficial owner or other Person (other than the Depository) of
any notice or the payment of any amount, under or with respect to such
Warrants. All notices and communications to be given to the Holders
and all payments to be made to Holders under the Warrants shall be
given or made only to or upon the order of the registered Holders
(which shall be the Depository or its nominee in the case of a Global
Warrant). The rights of beneficial owners in any Global Warrant shall
be exercised only through the Depository subject to the applicable
rules and procedures of the Depository. The Warrant Agent may rely and
shall be fully protected in relying upon information furnished by the
Depository with respect to its members, participants and any beneficial
owners.
(ii) The Warrant Agent shall have no obligation or duty to
monitor, determine or inquire as to compliance with any restrictions on
transfer imposed under this Agreement or under applicable law with
respect to any transfer of any interest in any Warrant (including any
transfers between or among the Depository participants, members or
beneficial owners in any Global Warrant) other than to require delivery
of such certificates and other documentation or evidence as are
expressly required by, and to do so if and when expressly required by,
the terms of this Agreement, and to examine the same to determine
substantial compliance as to form with the express requirements hereof.
(i) No Registration of Transfer. The Company shall not, and
shall cause the Warrant Agent not to, register any transfer of Warrants or
Warrant Shares not made in accordance with the provisions of Regulation S,
pursuant to registration under the Securities Act or pursuant to an available
exemption from registration.
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SECTION 2.05. Certificated Warrants. (a) A Global Warrant
deposited with the Depository or with the Warrant Agent as custodian for the
Depository pursuant to Section 2.01 shall be transferred to the beneficial
owners thereof in the form of certificated Warrants in a number equal to the
number of Warrants represented by such Global Warrant, in exchange for such
Global Warrant, only if such transfer complies with Section 2.04 and (i) the
Depository notifies the Company that it is unwilling or unable to continue as
depositary for such Global Warrant or if at any time the Depository ceases to be
a "clearing agency" registered under the Exchange Act and, in each such case, a
successor depositary is not appointed by the Company within 90 days of such
notice or (ii) the Company, in its sole discretion, notifies the Warrant Agent
in writing that it elects to cause the issuance of Certificated Warrants under
this Agreement.
(b) Any Global Warrant that is transferable to the beneficial
owners thereof pursuant to this Section shall be surrendered by the Depository
to the Warrant Agent, to be so transferred, in whole or from time to time in
part, with out charge, and the Warrant Agent shall countersign and deliver, upon
such transfer of each portion of such Global Warrant, an equal number of
Certificated Warrants. Any Certificated Warrants delivered in exchange for an
interest in the Global Warrant shall, except as otherwise provided by Section
2.04(g), bear the restricted securities legend set forth in Section 2.04(e)
hereto.
(c) Subject to the provisions of Section 2.05(b), the
registered Holder of a Global Warrant may grant proxies and otherwise authorize
any Person, including Agent Members and Persons that may hold interests through
Agent Members, to take any action which a Holder is entitled to take under this
Agreement or the Warrants.
(d) In the event of the occurrence of either of the events
specified in Section 2.05(a), the Company will promptly make available to the
Warrant Agent a reasonable supply of Certificated Warrants in definitive, fully
registered form.
SECTION 2.06. Replacement Certificates. If a mutilated Warrant
Certificate is surrendered to the Warrant Agent or if the Holder of a Warrant
Certificate claims that the Warrant Certificate has been lost, destroyed or
wrong fully taken, the Company shall issue and the Warrant Agent shall
countersign a replacement Warrant Certificate if the reasonable requirements of
the Warrant Agent and of Section 8-405 of the Uniform Commercial Code as in
effect in
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the State of New York are met. If required by the Warrant Agent or the Company,
such Holder shall furnish an indemnity bond sufficient in the judgment of the
Company and the Warrant Agent to protect the Company and the Warrant Agent from
any loss which either of them may suffer if a Warrant Certificate is replaced.
The Company and the Warrant Agent may charge the Holder for their expenses in
replacing a Warrant Certificate. Every replacement Warrant Certificate evidences
an additional obligation of the Company.
SECTION 2.07. Outstanding Warrants. Warrants outstanding at
any time are all Warrants evidenced on all Warrant Certificates authenticated by
the Warrant Agent except for those canceled by it and those delivered to it for
cancellation. A Warrant does not cease to be outstanding because an Affiliate of
the Company holds the Warrant. A Warrant ceases to be outstanding if the Company
holds the Warrant.
If a Warrant Certificate is replaced pursuant to Section 2.06,
the Warrants evidenced thereby cease to be outstanding unless the Warrant Agent
and the Company receive proof satisfactory to them that the replaced Warrant
Certificate is held by a bona fide purchaser.
SECTION 2.08. Cancellation. (a) In the event the Company shall
purchase or otherwise acquire Certificated Warrants, the same shall thereupon be
delivered to the Warrant Agent for cancellation.
(b) The Warrant Agent and no one else shall cancel and destroy
all Warrant Certificates surrendered for transfer, exchange, replacement,
exercise or cancellation and deliver a certificate of such destruction to the
Company unless the Company directs the Warrant Agent to deliver canceled Warrant
Certificates to the Company. The Company may not issue new Warrant Certificates
to replace Warrant Certificates to the extent they evidence Warrants which have
been exercised or Warrants which the Company has purchased or otherwise
acquired.
SECTION 2.09. CUSIP Numbers. The Company in issuing the
Warrants may use "CUSIP" numbers (if then generally in use) and, if so, the
Warrant Agent shall use "CUSIP" numbers in notices as a convenience to Holders;
provided, however, that any such notice may state that no representation is made
as to the correctness of such numbers either as printed on the Warrant
Certificates or as contained in any notice and that reliance may be placed only
on the other identification numbers printed on the Warrant Certificates.
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SECTION 2.10. Distribution of Contingent Warrants. The Warrant
Escrow Agreement provides that the Contingent Warrants will be released from
escrow and delivered to the Company for cancellation only if, as of December 31,
2002, (i) the Consolidated Leverage Ratio is equal to or less than 4.5 to 1.0 or
(ii) all of the Notes issued in connection with the Units have been repaid,
redeemed or repurchased by the Company. Unless so released to the Company for
cancellation, the Contingent Warrants will be released from escrow to the
Warrant Agent on the Contingent Warrant Release Date. In that event, the Warrant
Agent shall distribute the Contingent Warrants so received pro rata to the
registered holders of the Initial Warrants as of the Contingent Warrant Release
Date; provided, however, that to the extent an Initial Warrant is exercised
prior to the Contingent Warrant Release Date, the last registered holder of such
Initial Warrant will be deemed to be the registered holder of such Initial
Warrant (as adjusted from time to time pursuant to the provisions of Article IV
of this Agreement) as of the Contingent Warrant Release Date for purposes of
participating in the distribution of Contingent Warrants. To the extent
practicable and acceptable to the Depository, the Warrant Agent shall cause such
distribution of Contingent Warrants to be made by crediting to the account of
such distributee a beneficial interest in the Global Warrant equal to the number
of Contingent Warrants to be distributed to such Person. If the Release Event
does not occur, all of the Contingent Warrants shall be returned to the Company
for cancellation.
ARTICLE III
Exercise Terms
SECTION 3.01. Exercise. Each Warrant, when exercised, shall
initially entitle the Holder thereof, subject to adjustment pursuant to the
terms of this Agreement, to purchase 0.36469 shares of Common Stock. The
exercise price (the "Exercise Price") of each Warrant is $0.001 per share.
SECTION 3.02. Exercise Periods. (a) Subject to the terms and
conditions set forth herein, the Initial Warrants shall be exercisable at any
time and from time to time on or after November 14, 2001. The Contingent
Warrants may be exercised at any time after the occurrence of the Release Event.
Notwithstanding the foregoing, holders of Warrants will be able to exercise
their Warrants only if (i) the Common Shelf Registration Statement relating to
the
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Warrant Shares is effective or (ii) the exercise of such Warrants is exempt from
the registration requirements of the Securities Act, and, in each case, the
Warrant Shares are qualified for sale or exempt from qualification under the
applicable securities laws of the states or other jurisdictions in which such
holders reside. If the Warrant being exercised is a Regulation S Restricted
Warrant, upon exercise of any such Warrant, the Warrant Agent must receive a
written opinion of counsel to the effect that the Warrant Shares delivered upon
such exercise have been registered under the Securities Act or such exercise is
exempt therefrom. At the request of a Holder, such opinion will be provided by
counsel for the Company at no cost to the Holder.
(b) No Warrant shall be exercisable after May 1, 2009 (the
"Expiration Date").
SECTION 3.03. Expiration. A Warrant shall terminate and become
void as of the earlier of (i) the close of business on the Expiration Date or
(ii) the date such Warrant is exercised. The Company shall give notice not less
than 30, and not more than 60, days prior to the Expiration Date to the Holders
of all then outstanding Warrants to the effect that the Warrants will terminate
and become void as of the close of business on the Expiration Date; provided,
however, that if the Company fails to give notice as provided in this Section
3.03, the Warrants will nevertheless expire and become void on the Expiration
Date.
SECTION 3.04. Manner of Exercise. Warrants may be exercised
upon (i) surrender to the Warrant Agent at the office of the Warrant Agent of
the related Warrant Certificate, together with the form of election attached
thereto to purchase Common Stock on the reverse thereof duly filled in and
signed by the Holder thereof and (ii) payment to the Warrant Agent, for the
account of the Company, of the Exercise Price for each Warrant Share or other
security issuable upon the exercise of such Warrants then exercised. Such
payment shall be made (i) in cash or by certified or official bank check payable
to the order of the Company or by wire transfer of funds to an account
designated by the Company for such purpose or (ii) without the payment of cash,
by reducing the number of shares of Common Stock obtainable upon the exercise of
a Warrant and payment of the Exercise Price in cash so as to yield a number of
shares of Common Stock upon the exercise of such Warrant equal to the product of
(a) the number of shares of Common Stock issuable as of the Exercise Date upon
the exercise of such Warrant (if payment of the Exercise Price were being made
in cash) and (b) the Cashless Exercise Ratio. An exercise of a
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Warrant in accordance with the immediately preceding sentence is herein called a
"Cashless Exercise". Upon surrender of a Warrant Certificate representing more
than one Warrant in connection with the holder's option to elect a Cashless
Exercise, the number of shares of Common Stock deliverable upon a Cashless
Exercise shall be equal to the number of shares of Common Stock issuable upon
the exercise of Warrants that the holder specifies are to be exercised pursuant
to a Cashless Exercise multiplied by the Cashless Exercise Ratio. All provisions
of this Agreement shall be applicable with respect to a surrender of a Warrant
Certificate pursuant to a Cashless Exercise for less than the full number of
Warrants represented thereby. Subject to Section 3.02, the rights represented by
the Warrants shall be exercisable at the election of the Holders thereof either
in full at any time or from time to time in part and in the event that a Warrant
Certificate is surrendered for exercise of less than all the Warrants
represented by such Warrant Certificate at any time prior to the Expiration
Date, a new Warrant Certificate representing the remaining Warrants shall be
issued. The Warrant Agent shall countersign and deliver the required new Warrant
Certificates, and the Company, at the Warrant Agent's request, shall supply the
Warrant Agent with Warrant Certificates duly signed on behalf of the Company for
such purpose.
SECTION 3.05. Issuance of Warrant Shares. Subject to Section
2.06, upon the surrender of Warrant Certificates and payment of the per share
Exercise Price, as set forth in Section 3.04, the Company shall issue and cause
the Warrant Agent or, if appointed, a transfer agent for the Common Stock (the
"Stock Transfer Agent") to countersign and deliver to or upon the written order
of the Holder and in such name or names as the Holder may designate, a
certificate or certificates for the number of full Warrant Shares so purchased
upon the exercise of such Warrants or other securities or property to which it
is entitled, registered or otherwise, to the Person or Persons entitled to
receive the same (including any depositary institution so designated by a
Holder), together with cash as provided in Section 3.06 in respect of any
fractional Warrant Shares otherwise issuable upon such exercise. Such
certificate or certificates shall be deemed to have been issued and any Person
so designated to be named therein shall be deemed to have become a holder of
record of such Warrant Shares as of the date of the surrender of such Warrant
Certificates and payment of the per share Exercise Price, as aforesaid;
provided, however, that if, at such date, the transfer books for the Warrant
Shares shall be closed, the certificates for the Warrant Shares in respect of
which such Warrants are then exercised shall be issuable as of the date on which
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such books shall next be opened and until such date the Company shall be under
no duty to deliver any certificates for such Warrant Shares; provided further,
however, that such transfer books, unless otherwise required by law, shall not
be closed at any one time for a period longer than 20 calendar days.
SECTION 3.06. Fractional Warrant Shares. The Company shall not
be required to issue fractional Warrant Shares on the exercise of Warrants. If
more than one Warrant shall be exercised in full at the same time by the same
Holder, the number of full Warrant Shares which shall be issuable upon such
exercise shall be computed on the basis of the aggregate number of Warrant
Shares which may be purchasable pursuant thereto. If any fraction of a Warrant
Share would, except for the provisions of this Section 3.06, be issuable upon
the exercise of any Warrant (or specified portion thereof), the Company shall
pay an amount in cash equal to the Current Market Value per Warrant Share, as
determined on the day immediately preceding the date the Warrant is presented
for exercise, multiplied by such fraction, computed to the nearest whole cent.
SECTION 3.07. Reservation of Warrant Shares. The Company shall
at all times keep reserved out of its authorized shares of Common Stock a number
of shares of Common Stock sufficient to provide for the exercise of all
outstanding Warrants. The registrar for the Common Stock (the "Registrar") shall
at all times until the Expiration Date reserve such number of authorized shares
as shall be required for such purpose. The Company will keep a copy of this
Agreement on file with the Stock Transfer Agent. The Company will supply such
Stock Transfer Agent with duly executed stock certificates for such purpose and
will itself provide or otherwise make available any cash which may be payable as
provided in Section 3.06. The Company will furnish to such Stock Transfer Agent
a copy of all notices of adjustments (and certificates related thereto)
transmitted to each Holder.
Before taking any action which would cause an adjustment
pursuant to Article IV to reduce the Exercise Price below the then par value (if
any) of the Common Stock, the Company shall take any and all corporate action
which may, in the opinion of its counsel, be necessary in order that the Company
may validly and legally issue fully paid and nonassessable shares of Common
Stock at the Exercise Price as so adjusted.
The Company covenants that all Warrant Shares which may be
issued upon exercise of Warrants shall, upon
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issue, be fully paid, nonassessable, free of preemptive rights, free from all
taxes and free from all liens, charges and security interests with respect to
the issue thereof.
SECTION 3.08. Compliance with Law. (a) Notwithstanding
anything in this Agreement to the contrary, in no event shall a Holder be
entitled to exercise a Warrant unless (i) a registration statement filed under
the Securities Act in respect of the issuance of the Warrant Shares is then
effective or (ii) in the opinion of counsel to the Company addressed to the
Warrant Agent the exercise of such Warrants is exempt from the registration
requirements of the Securities Act and such securities are qualified for sale or
exempt from qualification under the applicable securities laws of the states or
other jurisdictions in which such Holders reside.
(b) If any shares of Common Stock required to be reserved for
purposes of the exercise of Warrants require, under any other Federal or state
law or applicable governing rule or regulation of any national securities
exchange, registration with or approval of any governmental authority, or
listing on any such national securities exchange before such shares may be
issued upon exercise, the Company will use its reasonable best efforts to cause
such shares to be duly registered or approved by such governmental authority or
listed on the relevant national securities exchange, as the case may be.
ARTICLE IV
Antidilution Provisions
SECTION 4.01. Changes in Common Stock. In the event that at
any time and from time to time the Company shall (i) pay a dividend or make a
distribution on the Common Stock in shares of Common Stock or other shares of
Capital Stock, (ii) subdivide its outstanding shares of Common Stock into a
larger number of shares of Common Stock, (iii) combine its outstanding shares of
Common Stock into a smaller number of shares of Common Stock or (iv) increase or
decrease the number of shares of Common Stock outstanding by reclassification of
its Common Stock, then the number of shares of Common Stock issuable upon
exercise of each Warrant immediately after the happening of such event shall be
adjusted so that, after giving effect to such adjustment, the Holder of each
Warrant shall be entitled to receive the number of shares of Common Stock upon
exercise of such Warrant that such Holder would have owned or would have been
entitled to receive had such Warrants been exercised
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immediately prior to the happening of the events described above (or, in the
case of a dividend or distribution of Common Stock, immediately prior to the
record date there for). An adjustment made pursuant to this Section 4.01 shall
become effective immediately after the distribution date, retroactive to the
record date therefor in the case of a dividend or distribution in shares of
Common Stock or other shares of Capital Stock, and shall become effective
immediately after the effective date in the case of a sub division, combination
or reclassification.
SECTION 4.02. Cash Dividends and Other Distributions. In the
event that at any time and from time to time the Company shall distribute to all
holders of Common Stock (i) any dividend or other distribution (including any
dividend or distribution made in connection with a consolidation or merger in
which the Company is the continuing corporation) of cash, evidences of its
indebtedness, shares of its Capital Stock or any other properties or securities
or (ii) any options, warrants or other rights to subscribe for or purchase any
of the foregoing (other than, in the case of clause (i) and (ii) above, (A) any
dividend or distribution described in Section 4.01, (B) any rights, options,
warrants or securities described in Section 4.03 or Section 4.04 and (C) any
cash dividends or other cash distributions from current or retained earnings
other than Extraordinary Cash Dividends), then the number of shares of Common
Stock issuable upon the exercise of each Warrant immediately prior to such
record date for any such dividend or distribution shall be increased to a number
determined by multiplying the number of shares of Common Stock issuable upon the
exercise of such Warrant immediately prior to such record date for any such
dividend or distribution by a fraction, the numerator of which shall be the
Current Market Value per share of Common Stock on the record date for such
dividend or distribution, and the denominator of which shall be such Current
Market Value per share of Common Stock less the sum of (x) the amount of cash,
if any, distributed per share of Common Stock and (y) the then fair value (as
determined in good faith by the Board, whose determination shall be evidenced by
a board resolution filed with the Warrant Agent, a copy of which will be sent to
Holders upon request) of the portion, if any, of the distribution applicable to
one share of Common Stock consisting of evidences of indebtedness, shares of
stock, securities, other property, warrants, options or subscription or purchase
rights; and subject to Section 4.08, the Exercise Price shall be adjusted to a
number determined by dividing the Exercise Price immediately prior to such
record date by the above fraction. Such adjustments shall be made, and shall
only
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become effective, whenever any dividend or distribution is made; provided,
however, that the Company is not required to make an adjustment pursuant to this
Section 4.02 if at the time of such distribution the Company makes the same
distribution to Holders of Warrants as it makes to holders of Common Stock pro
rata based on the number of shares of Common Stock for which such Warrants are
exercisable (whether or not currently exercisable). No adjustment shall be made
pursuant to this Section 4.02 which shall have the effect of decreasing the
number of shares of Common Stock issuable upon exercise of each Warrant or
increasing the Exercise Price.
SECTION 4.03. Common Stock Issue. In the event that at any
time or from time to time the Company shall issue shares of Common Stock for a
consideration per share that is less than the Current Market Value per share of
Common Stock as of the issuance date of such shares, the number of shares of
Common Stock issuable upon the exercise of each Warrant immediately after such
issuance date shall be determined by multiplying the number of shares of Common
Stock issuable upon exercise of each Warrant immediately prior to such issuance
date by a fraction, the numerator of which shall be the number of shares of
Common Stock out standing immediately preceding the issuance of such shares plus
the number of additional shares of Common Stock to be issued in such
transaction, and the denominator of which shall be the number of shares of
Common Stock outstanding immediately preceding the date for the issuance of such
shares plus the total number of shares of Common Stock which the aggregate
consideration expected to be received by the Company upon the issuance of such
shares (as determined in good faith by the Board, whose determination shall be
evidenced by a board resolution filed with the Warrant Agent, a copy of which
will be sent to Holders upon request) would purchase at the Current Market Value
per share of Common Stock as of the date of such issuance; and, subject to
Section 4.08, in the event of any such adjustment, the Exercise Price shall be
adjusted to a number determined by dividing the Exercise Price immediately prior
to such date of issuance by the aforementioned fraction; provided, however, that
no adjustment to the number of Warrant Shares issuable upon the exercise of the
Warrants or to the Exercise Price shall be made as a result of (i) the issuance
of shares of Common Stock in bona fide public offerings that are underwritten or
in which a placement agent is retained by the Company, (ii) the issuance of
shares of Common Stock (including the exercise of options) to officers,
directors or employees of the Company, (iii) the issuance of shares of Common
Stock in connection with acquisitions of products and businesses other than to
Affiliates of the Company and
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(iv) the issuance of shares of Common Stock upon the conversion, exchange or
exercise of convertible, exchangeable or exercisable securities of the Company
outstanding on the Issue Date. Such adjustment shall be made, and shall only
become effective, whenever such shares are issued. No adjustment shall be made
pursuant to this Section 4.03 which shall have the effect of decreasing the
number of shares of Common Stock issuable upon exercise of each Warrant or
increasing the Exercise Price.
SECTION 4.04. Issuance of Rights or Options. In the event that
at any time or from time to time the Company shall issue to all holders of
Common Stock (i) rights, options or warrants to acquire (provided, however, that
no adjustment shall be made under Section 4.03 or this Section 4.04 upon the
exercise of such rights, options or warrants), or (ii) securities convertible,
exchangeable or exercisable into (provided, however, that no adjustment shall be
made under Section 4.03 or this Section 4.04 upon the conversion or exchange of
such securities (other than issuances specified in clauses (i) or (ii) which are
made as the result of anti-dilution adjustments in such securities)), Common
Stock entitling the holders thereof to subscribe for or purchase shares of
Common Stock at a price per share that is less than the Current Market Value per
share of Common Stock in effect immediately prior to such issuance other than in
connection with the adoption of a shareholder rights plan by the Company, the
number of shares of Common Stock issuable upon the exercise of each Warrant
immediately after such issuance shall be determined by multiplying the number of
shares of Common Stock issuable upon exercise of each Warrant immediately prior
to such issuance by a fraction, the numerator of which shall be the number of
shares of Common Stock outstanding immediately prior to the issuance of such
rights, options, warrants or securities plus the number of additional shares of
Common Stock offered for subscription or purchase or into which such securities
are convertible or exchangeable, and the denominator of which shall be the
number of shares of Common Stock outstanding immediately prior to the issuance
of such rights, options, warrants or securities plus the total number of shares
of Common Stock which the aggregate consideration expected to be received by
the Company upon the exercise, conversion or exchange of such rights, options,
warrants or securities (as determined in good faith by the Board, whose
determination shall be evidenced by a board resolution filed with the Warrant
Agent, a copy of which will be sent to Holders upon request) would purchase at
the Current Market Value per share of Common Stock as of the record date; and,
subject to Section 4.08, in the event of any such adjustment, the Exercise Price
shall be adjusted to
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a number determined by dividing the Exercise Price immediately prior to such
date of issuance by the aforementioned fraction. Such adjustment shall be made,
and shall only become effective, whenever such rights, options, warrants or
securities are issued. No adjustment shall be made pursuant to this Section 4.04
which shall have the effect of decreasing the number of shares of Common Stock
issuable upon exercise of each Warrant or increasing the Exercise Price.
SECTION 4.05. Combination; Liquidation. (a) Except as provided
in Section 4.05(b), in the event of a Combination, each Holder shall have the
right to receive upon exercise of the Warrants the kind and amount of shares of
Capital Stock or other securities or property which such Holder would have been
entitled to receive upon completion of or as a result of such Combination had
such Warrant been exercised immediately prior to such event or to the relevant
record date for any such entitlement. Unless paragraph (b) is applicable to a
Combination, the Company shall provide that the surviving or acquiring Person
(the "Successor Company") in such Combination will enter into an agreement with
the Warrant Agent confirming the Holders' rights pursuant to this Section
4.05(a) and providing for adjustments, which shall be as nearly equivalent as
may be practicable to the adjustments provided for in this Article IV. The
provisions of this Section 4.05(a) shall similarly apply to successive
Combinations involving any Successor Company.
(b) In the event of (i) a Combination where consideration to
the holders of Common Stock in exchange for their shares is payable solely in
cash or (ii) the dissolution, liquidation or winding-up of the Company, the
Holders of the Warrants shall be entitled to receive, upon surrender of their
Warrant Certificates, such cash distributions on an equal basis with the holders
of Common Stock or other securities issuable upon exercise of the Warrants, as
if the Warrants had been exercised immediately prior to such event, less the
Exercise Price.
In the event of any Combination described in this Section
4.05(b), the surviving or acquiring Person and, in the event of any dissolution,
liquidation or winding-up of the Company, the Company, shall deposit promptly
with the Warrant Agent the funds, if any, necessary to pay the Holders of the
Warrants the amounts to which they are entitled as described above. After such
funds and the surrendered Warrant Certificates are received, the Warrant Agent
shall make payment to the Holders by delivering a check in such amount as is
appropriate (or, in the case of
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consideration other than cash, such other consideration as is appropriate) to
such Person or Persons as it may be directed in writing by the Holders
surrendering such Warrants.
(c) The provisions of this Section 4.05 shall apply to the
Contingent Warrants notwithstanding that the Contingent Warrants may still be
held in escrow pursuant to the Contingent Warrant Escrow Agreement. In that
event, any distribution that would otherwise be made to Holders of the
Contingent Warrants will be held for distribution if and when the Contingent
Warrants are released from escrow for distribution to Holders of Initial
Warrants.
SECTION 4.06. Other Events. If any event occurs as to which
the foregoing provisions of this Article IV are not strictly applicable or, if
strictly applicable, would not, in the good faith judgment of the Board, fairly
and adequately protect the purchase rights of the Warrants in accordance with
the essential intent and principles of such provisions, then such Board shall
make such adjustments in the application of such provisions, in accordance with
such essential intent and principles, as shall be reasonably necessary, in the
good faith opinion of such Board, to protect such purchase rights as aforesaid,
but in no event shall any such adjustment have the effect of increasing the
Exercise Price or decreasing the number of shares of Common Stock issuable upon
exercise of the Warrants.
SECTION 4.07. Superseding Adjustment. Upon the expiration of
any rights, options, warrants or conversion or exchange privileges which
resulted in adjustments pursuant to this Article IV, if any thereof shall not
have been exercised, the number of Warrant Shares issuable upon the exercise of
each Warrant shall be readjusted pursuant to the applicable section of Article
IV as if (i) the only shares of Common Stock issuable upon exercise of such
rights, options, warrants, conversion or exchange privileges were the shares of
Common Stock, if any, actually issued upon the exercise of such rights, options,
warrants or conversion or exchange privileges and (ii) shares of Common Stock
actually issued, if any, were issuable for the consideration actually received
by the Company upon such exercise plus the aggregate consideration, if any,
actually received by the Company for the issuance, sale or grant of all such
rights, options, warrants or conversion or exchange privileges whether or not
exercised and the Exercise Price shall be readjusted inversely; provided,
however, that no such readjustment (except by reason of an intervening
adjustment under Section 4.01) shall have the effect of decreasing the number of
Warrant Shares issuable upon the exercise of each
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Warrant or increasing the Exercise Price by an amount in excess of the amount of
the adjustment initially made in respect of the issuance, sale or grant of such
rights, options, warrants or conversion or exchange privileges.
SECTION 4.08. Minimum Adjustment. The adjustments required by
the preceding sections of this Article IV shall be made whenever and as often as
any specified event requiring an adjustment shall occur, except that no adjust-
ment of the Exercise Price or the number of shares of Common Stock issuable upon
exercise of the Warrants that would otherwise be required shall be made unless
and until such adjustment either by itself or with other adjustments not
previously made increases or decreases by at least 1% the Exercise Price or the
number of shares of Common Stock issuable upon exercise of the Warrants
immediately prior to the making of such adjustment. Any adjustment representing
a change of less than such minimum amount shall be carried forward and made as
soon as such adjustment, together with other adjustments required by this
Article IV and not previously made, would result in a minimum adjustment. For
the purpose of any adjustment, any specified event shall be deemed to have
occurred at the close of business on the date of its occurrence. In computing
adjustments under this Article IV, fractional interests in Common Stock shall be
taken into account to the nearest one-hundredth of a share.
SECTION 4.09. Notice of Adjustment. Whenever the Exercise
Price or the number of shares of Common Stock and other property, if any,
issuable upon exercise of the Warrants is adjusted, as herein provided, the
Company shall deliver to the Warrant Agent a certificate of a firm of
independent accountants selected by the Board (who may be the regular
accountants employed by the Company) setting forth, in reasonable detail, the
event requiring the adjustment and the method by which such adjustment was
calculated (including a description of the basis on which (i) the Board
determined the then fair value of any evidences of indebtedness, other
securities or property or warrants, options or other subscription or purchase
rights and (ii) the Current Market Value of the Common Stock was determined, if
either of such determinations were required), and specifying the Exercise Price
and the number of shares of Common Stock issuable upon exercise of the Warrants
after giving effect to such adjustment. The Company shall promptly cause the
Warrant Agent to mail a copy of such certificate to each Holder in accordance
with Section 8.05. The Warrant Agent shall be entitled to rely on such
certificate and shall be under no duty or responsibility with respect to any
such certificate, except to exhibit the same from time to time, to any Holder
desiring an inspection
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thereof during reasonable business hours. The Warrant Agent shall not at any
time be under any duty or responsibility to any Holder to determine whether any
facts exist which may require any adjustment of the Exercise Price or the number
of shares of Common Stock or other stock or property issuable on exercise of the
Warrants, or with respect to the nature or extent of any such adjustment when
made, or with respect to the method employed in making such adjustment or the
validity or value of any shares of Common Stock, evidences of indebtedness,
warrants, options, or other securities or property.
SECTION 4.10. Notice of Certain Transactions. In the event
that the Company shall propose to (a) pay any dividend payable in securities of
any class to the holders of its Common Stock or to make any other non-cash
dividend or distribution to the holders of its Common Stock, (b) offer the
holders of its Common Stock rights to subscribe for or to purchase any
securities convertible into shares of Common Stock or shares of stock of any
class or any other securities, rights or options, (c) issue any (i) shares of
Common Stock, (ii) rights, options or warrants entitling the holders thereof to
subscribe for shares of Common Stock or (iii) securities convertible into or
exchangeable or exercisable for Common Stock (in the case of (i), (ii) and
(iii), if such issuance or adjustment would result in an adjustment hereunder),
(d) effect any capital reorganization, reclassification, consolidation or
merger, (e) effect the voluntary or involuntary dissolution, liquidation or
winding-up of the Company or (f) make a tender offer or exchange offer with
respect to the Common Stock, the Company shall within five days after any such
action or offer send to the Warrant Agent a notice and the Warrant Agent shall
within five days after receipt thereof send the Holders a notice (in such form
as shall be furnished to the Warrant Agent by the Company) of such proposed
action or offer. Such notice shall be mailed by the Warrant Agent to the Holders
at their addresses as they appear in the Certificate Register, which shall
specify the record date for the purposes of such dividend, distribution or
rights, or the date such issuance or event is to take place and the date of
participation therein by the holders of Common Stock, if any such date is to be
fixed, and shall briefly indicate the effect, if any, of such action on the
Common Stock and on the number and kind of any other shares of stock and on
other property, if any, and the number of shares of Common Stock and other
property, if any, issuable upon exercise of each Warrant and the Exercise Price
after giving effect to any adjustment pursuant to Article IV which will be
required as a result of such action. Such notice shall be given as promptly as
possible and (x) in the case
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of any action covered by clause (a) or (b) above, at least 10 days prior to the
record date for determining holders of the Common Stock for purposes of such
action or (y) in the case of any other such action, at least 20 days prior to
the date of the taking of such proposed action or the date of participation
therein by the holders of Common Stock, whichever shall be the earlier.
SECTION 4.11. Adjustment to Warrant Certificate. The form of
Warrant Certificate need not be changed because of any adjustment made pursuant
to this Article IV, and Warrant Certificates issued after such adjustment may
state the same Exercise Price and the same number of shares of Common Stock
issuable upon exercise of the Warrants as are stated in the Warrant Certificates
initially issued pursuant to this Agreement. The Company, however, may at any
time in its sole discretion make any change in the form of Warrant Certificate
that it may deem appropriate to give effect to such adjustments and that does
not affect the substance of the Warrant Certificate, and any Warrant Certificate
thereafter issued or countersigned, whether in exchange or substitution for an
outstanding Warrant Certificate or otherwise, may be in the form as so changed.
ARTICLE V
Registration Rights; Indemnification
SECTION 5.01. Effectiveness of Registration Statement. Subject
to Section 5.02, the Company shall cause to be filed pursuant to Rule 415 (or
any successor provision) of the Securities Act not later than 45 days after the
Issue Date, a shelf registration statement relating to the offer and sale of the
Warrants by the Holders from time to time in accordance with the methods of
distribution elected by such holders and set forth in such registration
statement (the "Warrant Shelf Registration Statement"), and shall use its best
efforts to cause the Warrant Shelf Registration Statement to be declared
effective under the Securities Act on or before 180 days after the Issue Date
and a shelf registration statement covering the issuance of Warrant Shares to
the Holders upon exercise of the Warrants by the Holders thereof (the "Common
Shelf Registration Statement", and together with the Warrant Shelf Registration
Statement, the "Registration Statements") and shall use its best efforts to
cause the Common Shelf Registration Statement to be declared effective on or
before 365 days after the Issue Date. The Company shall use its best efforts to
cause (a) the Warrant Shelf Registration Statement to remain effective until the
earliest of (i) such
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time as all Warrants have been sold thereunder, (ii) two years after its
effective date and (iii) until all Warrants can be sold without restriction
under the Securities Act and (b) the Common Shelf Registration Statement to
remain effective until the earlier of (i) such time as all Warrants have been
exercised or canceled and (ii) the Expiration Date. In connection with any
Registration Statement, (i) the Company shall furnish to the Warrant Agent,
prior to the filing with the Commission, a copy of any Registration Statement,
and each amendment thereof and each amendment or supplement, if any, to the
prospectus included therein and shall use its reasonable best efforts to reflect
in each such document, when filed with the Commission, such comments as the
Warrant Agent may reasonably propose, (ii) the Company shall furnish to each
Holder, without charge, at least one copy of any Registration Statement and any
post- effective amendment thereto, including financial statements and schedules,
and, if the Holder so requests in writing, all exhibits thereto (including those
incorporated by reference), (iii) the Company shall, for so long as any
Registration Statement is effective, deliver to each Holder, without charge, as
many copies of the prospectus (including each preliminary prospectus) included
in such Registration Statement and any amendment or supplement thereto as such
Holder may reasonably request, and the Company consents to the proper use of the
prospectus therein and any amendment or supplement thereto by each of the
selling Holders in connection with the offering and sale of the Warrants or the
Warrant Shares, as the case may be, covered by such prospectus and any amendment
or supplement thereto, (iv) the Company may require each Holder of Warrants to
be sold pursuant to the Warrant Shelf Registration Statement or to be exercised
in connection with the Common Shelf Registration Statement to furnish to the
Company such information regarding the Holder and the distribution of such
Warrants or Warrant Shares as the Company may from time to time reasonably
request for inclusion in such Registration Statement, (v) the Company shall, if
requested, promptly incorporate in a prospectus supplement or post-effective
amendment to such Registration Statement such information as a majority in
interest of the Holders reasonably agree should be included therein and shall
make all required filings of such prospectus supplement or post-effective
amendment as soon as notified of the matters to be incorporated in such
prospectus supplement or post-effective amendment, (vi) the Company shall enter
into such agreements (including underwriting agreements) as are appropriate,
customary and reasonably necessary in connection with any such Registration
Statement and (vii) the Company shall (A) make available all material customary
for reasonable due diligence examinations in connection with such Xxxxxxxxxxxx
00
00
Xxxxxxxxxx, (X) make such representations and warranties to the Holders of
Warrants and the underwriters, if any, as are customary and reasonable in
connection with such Registration Statements, (C) obtain such opinions of
counsel to the Company addressed to and reasonably satisfactory to the Holders
of 10% of the then outstanding Warrants as are customary and reasonable in
connection with such Registration Statements and (D) obtain such "comfort"
letters and updates thereof from the independent certified public accountants of
the Company addressed to the Holders as are customary and reasonable in
connection with such Registration Statements. The Company will furnish the
Warrant Agent with current prospectuses meeting the requirements of the
Securities Act in sufficient quantity to permit the Warrant Agent to deliver, at
the Company's expense, a prospectus to each holder of a Warrant upon the
exercise thereof. The Company shall promptly inform the Warrant Agent of any
change in the status of the effectiveness or availability of any Registration
Statement.
SECTION 5.02. Suspension. During any consecutive 365-day
period, the Company shall be entitled to suspend the availability of each of the
Warrant Shelf Registration Statement and the Common Shelf Registration Statement
for up to 60 days (except for the 60 day period immediately prior to the
Expiration Date) if (i) the Company determines, in its reasonable judgment, upon
advice of counsel, that the continued effectiveness and usability of the Warrant
Shelf Registration Statement and the Common Shelf Registration Statement would
(x) require the disclosure of material information, which the Company or any of
its subsidiaries has a bona fide business reason for preserving as confidential
or (y) interfere with any financing, acquisition, corporate reorganization or
other material transaction involving the Company or any of its subsidiaries;
provided, however, that the number of days of any actual Suspension Period (as
hereinafter defined) shall be added on to, and therefore extend, the two-year
period specified in Section 5.02(a)(ii). Any such period during which the
Company is excused from keeping the Warrant Shelf Registration Statement or the
Common Shelf Registration Statement effective and usable for offers and sales of
securities is referred to herein as a "Suspension Period." A Suspension Period
shall commence on and include the date that the Company gives notice that either
the Warrant Shelf Registration Statement or the Common Shelf Registration
Statement is no longer effective or the prospectus included therein is no longer
usable for offers and sales of Warrants or Warrant Shares, as applicable, and
shall end on the earlier to occur of (1) the date on which each seller of
Warrants or Warrant Shares covered by the Warrant Shelf
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Registration Statement and the Common Shelf Registration Statement, as the case
may be, is advised in writing by the Company that the use of the prospectus may
be resumed and (2) the expiration of 60 days in any consecutive 365-day period
during which one or more Suspension Periods has been in effect.
SECTION 5.03. Blue Sky. The Company shall use its best efforts
to register or qualify the Warrants and the Warrant Shares under all applicable
securities laws, blue sky laws or similar laws of all jurisdictions in the
United States and Canada in which any holder of Warrants may or may be deemed to
purchase Warrants or Warrant Shares upon the exercise of Warrants and shall use
its reasonable best efforts to maintain such registration or qualification for
so long as it is required to cause the Warrant Shelf Registration Statement (in
the case of the Warrants) and the Common Shelf Registration Statement (in the
case of the Warrant Shares) to remain effective under the Securities Act
pursuant to Section 5.01; provided, however, that the Company shall not be
required to qualify generally to do business in any jurisdiction where it would
not otherwise be required to qualify but for this Section 5.03 or to take any
action which would subject it to general service of process or to taxation in
any such jurisdiction where it is not then so subject.
SECTION 5.04. Accuracy of Disclosure. The Company represents
and warrants to each Holder and agrees for the benefit of each Holder that (i)
each of the Warrant Shelf Registration Statement and the Common Shelf
Registration Statement and any amendment thereto will not contain any untrue
statement of a material fact or omit to state a material fact or necessary to
make the statements contained therein not misleading and (ii) each of the
prospectus furnished to such Holder for delivery in connection with the sale of
Warrants and the prospectus delivered to such Holder upon the exercise of
Warrants and the documents incorporated by reference therein will not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements contained
therein, in light of the circumstances under which they were made, not
misleading; provided, however, that the Company shall have no liability under
clauses (i) or (ii) of this Section 5.04 with respect to any such untrue
statement or omission made in any Registration Statement or prospectus in
reliance upon and in conformity with information furnished to the Company by or
on behalf of the Holders expressly for inclusion therein.
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SECTION 5.05. Indemnification. (a) In connection with any
Registration Statement, the Company agrees to indemnify and hold harmless each
Holder of the Securities, and each person, if any, who controls such Holder
within the meaning of the Securities Act or the Exchange Act (each Holder and
such controlling persons being referred to collectively as the "Indemnified
Parties") from and against any losses, claims, damages or liabilities, joint or
several, or any actions in respect thereof (including, but not limited to, any
losses, claims, damages, liabilities or actions relating to purchases and sales
of the Securities) to which each Indemnified Party may become subject under the
Securities Act, the Exchange Act or otherwise, insofar as such losses, claims,
damages, liabilities or actions arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in a
Registration Statement or prospectus or in any amendment or supplement thereto
or in any preliminary prospectus relating to a Registration Statement, or arise
out of, or are based upon, the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, and shall reimburse, as incurred, the Indemnified Parties for any
legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action in
respect thereof; provided, however, that (i) the Company shall not be liable in
any such case to the extent that such loss, claim, damage or liability arises
out of or is based upon any untrue statement or alleged untrue statement or
omission or alleged omission made (A) in a Registration Statement or prospectus
or in any amendment or supplement thereto or in any preliminary prospectus
relating to a Registration Statement in reliance upon and in conformity with
written information pertaining to such Holder and furnished to the Company by or
on behalf of such Holder or any underwriter, selling broker or dealer-manager
participating in the distribution of Warrants or Warrant Shares under the
Registration Statement expressly for inclusion therein or (B) resulting from the
use of the prospectus relating to such Securities during a period when the
effectiveness of the Registration Statement containing such prospectus has been
suspended or is otherwise unavailable to be used for sales thereunder pursuant
to Section 5.02 hereof, provided that Holders receive at least 5 days prior
written of such suspension or unavailability, and (ii) with respect to any
untrue statement or omission or alleged untrue statement or omission made in any
preliminary prospectus relating to a Registration Statement, the indemnity
agreement contained in this subsection (a) shall
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not inure to the benefit of any Holder from whom the person asserting any such
losses, claims, damages or liabilities purchased the Securities concerned, to
the extent that a prospectus relating to such Securities was required to be
delivered by such Holder under the Securities Act in connection with such
purchase and any such loss, claim, damage or liability of such Holder results
from the fact that there was not sent or given to such person, at or prior to
the written confirmation of the sale of such Securities to such person, a copy
of the final prospectus if the Company had previously furnished copies thereof
to such Holder; provided further, however, that this indemnity agreement will be
in addition to any liability which the Company may otherwise have to such
Indemnified Party. The Company shall also indemnify underwriters, selling
brokers, dealer-managers and similar securities industry professionals
participating in the distribution (in each case as described in the Registration
Statement), their officers and directors and each person who controls such
persons within the meaning of the Securities Act or the Exchange Act to the same
extent as provided above with respect to the indemnification of the Holders of
the Securities if requested by such Holders.
(b) In connection with any Registration Statement, each Holder
of the Securities, severally and not jointly, will indemnify and hold harmless
the Company and each person, if any, who controls the Company within the meaning
of the Securities Act or the Exchange Act (and the directors, officers, agents
and employees of the Company and any such controlling person) from and against
any losses, claims, damages or liabilities or any actions in respect thereof
(including, but not limited to, any losses, claims, damages, liabilities or
actions relating to purchases and sales of the Securities) to which the Company
or any such controlling person (or the directors, officers, agents and employees
of the Company and any such controlling person) may become subject under the
Securities Act, the Exchange Act or otherwise, insofar as such losses, claims,
damages, liabilities or actions arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in a
Registration Statement or prospectus or in any amendment or supplement thereto
or in any preliminary prospectus relating to a Registration Statement, or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, but in each case only to the extent that the untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity
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with written information pertaining to such Holder and furnished to the Company
by or on behalf of such Holder specifically for inclusion therein; and, subject
to the limitation set forth immediately preceding this clause, shall reimburse,
as incurred, the Company for any legal or other expenses reasonably incurred by
the Company or any such controlling person (or the directors, officers, agents
and employees of the Company and any such controlling person) in connection with
investigating or defending any loss, claim, damage, liability or action in
respect thereof. This indemnity agreement will be in addition to any liability
which such Holder may otherwise have to the Company or any of its controlling
persons.
(c) Promptly after receipt by an indemnified party under this
Section 5.05 of notice of the commencement of any action or proceeding
(including a governmental investigation), such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 5.05, notify the indemnifying party of the commencement thereof; but the
failure to so notify the indemnifying party will not, in any event, relieve the
indemnifying party from any obligations to any indemnified party other than the
indemnification obligation provided in paragraph (a) or (b) above (except to the
extent that it is prejudiced or harmed in any material respect by failure to
give such prompt notice). In case any such action is brought against any
indemnified party, and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein and, to
the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel reasonably satisfactory to
such indemnified party (who shall not, except with the consent of the
indemnified party, act as both counsel to the indemnified and indemnifying
parties in such action if, in the reasonable opinion of both counsel to the
indemnified party and the indemnifying party, a conflict exists which makes such
joint representation not advisable), and after notice from the indemnifying
party to such indemnified party of its election to so assume the defense thereof
the indemnifying party will not be liable to such indemnified party under this
Section 5.05 for any legal or other expenses, other than reasonable costs of
investigation, subsequently incurred by such indemnified party in connection
with the defense thereof. No indemnifying party shall, without the prior written
consent of the indemnified party, not to be unreasonably withheld, effect any
settlement of any pending or threatened action in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such
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indemnified party unless such settlement includes an unconditional release of
such indemnified party from all liability on any claims that are the subject
matter of such action. No indemnifying party shall be liable for any amounts
paid in settlement of any action or claim without its written consent, which
consent shall not be unreasonably withheld.
(d) If the indemnification provided for in this Section 5.05
is unavailable or insufficient to hold harmless an indemnified party under
subsections (a) or (b) above, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to in
subsection (a) or (b) above (i) in such proportion as is appropriate to reflect
the relative benefits received by the indemnifying party or parties on the one
hand and the indemnified party on the other from the Registration Statement, or
(ii) if the allocation provided by the foregoing clause (i) is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the indemnifying party or parties on the one hand and the indemnified party on
the other in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities (or actions in respect thereof) as well
as any other relevant equitable considerations. The relative fault of the
parties shall be deter mined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company
on the one hand or such Holder or such other indemnified person, as the case may
be, on the other, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The amount paid by an indemnified party as a result of the losses, claims,
damages or liabilities referred to in the first sentence of this subsection (d)
shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any action
or claim which is the subject of this subsection (d). Notwithstanding any other
provision of this Section 5.05(d), the Holders of the Securities shall not be
required to contribute any amount in excess of the amount by which the net
proceeds received by such Holders from the sale of the Warrants pursuant to the
Warrant Shelf Registration Statement or the Warrant Shares pursuant to the
Common Shelf Registration Statement exceeds the amount of damages which such
Holders have otherwise been required to pay by reason
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of such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. For purposes of this
paragraph (d), each person, if any, who controls such indemnified party within
the meaning of the Securities Act or the Exchange Act shall have the same rights
to contribution as such indemnified party and each person, if any, who controls
the Company within the meaning of the Securities Act or the Exchange Act shall
have the same rights to contribution as the Company.
(e) The agreements contained in this Section 5.05 shall
survive the sale of the Securities pursuant to the Registration Statements and
shall remain in full force and effect, regardless of any termination or
cancellation of this Agreement or any investigation made by or on behalf of any
indemnified party.
SECTION 5.06. Additional Acts. If the sale of Warrants or the
issuance or sale of any Common Stock or other securities issuable upon the
exercise of the Warrants requires registration or approval of any governmental
authority (other than the registration requirements under the Securities Act),
or the taking of any other action under the laws of the United States or any
political subdivision thereof before such securities may be validly offered or
sold in compliance with such laws, then the Company covenants that it will, in
good faith and as expeditiously as reasonably possible, use its reasonable best
efforts to secure and maintain such registration or approval or to take such
other action, as the case may be. The Company shall promptly notify the Warrant
Agent in writing when (i) the Company has obtained all such governmental
approvals and authorizations and (ii) such approvals and authorizations
thereafter cease to be in effect.
SECTION 5.07. Expenses. All expenses incident to the Company's
performance of or compliance with its obligations under this Article V will be
borne by the Company, including without limitation: (i) all SEC, stock exchange
or National Association of Securities Dealers, Inc. registration and filing
fees, (ii) all reasonable fees and expenses incurred in connection with the
compliance with state securities or blue sky laws, (iii) all expenses of any
Persons incurred by or on behalf of the Company in preparing or assisting in
preparing, printing and distributing the Warrant Shelf Registration Statement,
the Common Shelf Registration Statement or any other registration statement,
prospectus, any amendments or supplements thereto and other
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documents relating to the performance of and compliance with this Article V,
(iv) the fees and disbursements of the Warrant Agent as agreed, (v) the fees and
disbursements of counsel for the Company and the Warrant Agent as agreed and
(vi) the fees and disbursements of the independent public accountants of the
Company, including the expenses of any special audits or comfort letters
required by or incident to such performance and compliance.
ARTICLE VI
Warrant Agent
SECTION 6.01. Appointment of Warrant Agent. The Company hereby
appoints the Warrant Agent to act as agent for the Company in accordance with
the provisions of this Agreement and the Warrant Agent hereby accepts such
appointment.
SECTION 6.02. Rights and Duties of Warrant Agent. (a) Agent
for the Company. In acting under this Warrant Agreement and in connection with
the Warrant Certificates, the Warrant Agent is acting solely as agent of the
Company and does not assume any obligation or relationship or agency or trust
for or with any of the holders of Warrant Certificates or beneficial owners of
Warrants.
(b) Counsel. The Warrant Agent may consult with counsel
satisfactory to it (who may be counsel to the Company), and the advice of such
counsel shall be full and complete authorization and protection in respect of
any action taken, suffered or omitted by it hereunder in good faith and in
accordance with the advice of such counsel.
(c) Documents. The Warrant Agent shall be protected and shall
incur no liability for or in respect of any action taken or thing suffered by it
in reliance upon any Warrant Certificate, notice, direction, consent,
certificate, affidavit, statement or other paper or document reasonably believed
by it to be genuine and to have been presented or signed by the proper parties.
(d) No Implied Obligations. The Warrant Agent shall be
obligated to perform only such duties as are specifically set forth herein and
in the Warrant Certificates, and no implied duties or obligations of the Warrant
Agent shall be read into this Agreement or the Warrant Certificates against the
Warrant Agent. The Warrant Agent shall not be under any obligation to take any
action hereunder which may tend to involve it in any expense or
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liability for which it does not receive indemnity if such indemnity is
reasonably requested. The Warrant Agent shall not be accountable or under any
duty or responsibility for the use by the Company of any of the Warrant
Certificates countersigned by the Warrant Agent and delivered by it to the
Holders or on behalf of the Holders pursuant to this Agreement or for the
application by the Company of the proceeds of the Warrants. The Warrant Agent
shall have no duty or responsibility in case of any default by the Company in
the performance of its covenants or agreements contained herein or in the
Warrant Certificates or in the case of the receipt of any written demand from a
Holder with respect to such default, including any duty or responsibility to
initiate or attempt to initiate any proceedings at law or otherwise.
(e) Not Responsible for Adjustments or Validity of Stock. The
Warrant Agent shall not at any time be under any duty or responsibility to any
Holder to determine whether any facts exist that may require an adjustment of
the number of shares of Common Stock issuable upon exercise of each Warrant or
the Exercise Price, or with respect to the nature or extent of any adjustment
when made, or with respect to the method employed, or herein or in any supple
mental agreement provided to be employed, in making the same. The Warrant Agent
shall not be accountable with respect to the validity or value of any shares of
Common Stock or of any securities or property which may at any time be issued or
delivered upon the exercise of any Warrant or upon any adjustment pursuant to
Article IV, and it makes no representation with respect thereto. The Warrant
Agent shall not be responsible for any failure of the Company to make any cash
payment or to issue, transfer or deliver any shares of Common Stock or stock
certificates upon the surrender of any Warrant Certificate for the purpose of
exercise or upon any adjustment pursuant to Article IV, or to comply with any of
the covenants of the Company contained in Article IV.
SECTION 6.03. Individual Rights of Warrant Agent. The Warrant
Agent and any stockholder, director, officer or employee of the Warrant Agent
may buy, sell or deal in any of the Warrants or other securities of the Company
or its affiliates or become pecuniarily interested in transactions in which the
Company or its affiliates may be interested, or contract with or lend money to
the Company or its affiliates or otherwise act as fully and freely as though it
were not the Warrant Agent under this Agreement. Nothing herein shall preclude
the Warrant Agent from acting in any other capacity for the Company or for any
other legal entity.
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SECTION 6.04. Warrant Agent's Disclaimer. The Warrant Agent
shall not be responsible for and makes no representation as to the validity or
adequacy of this Agreement or the Warrant Certificates and it shall not be
responsible for any statement in this Agreement or the Warrant Certificates
other than its countersignature thereon.
SECTION 6.05. Compensation and Indemnity. The Company agrees
to pay the Warrant Agent from time to time reasonable compensation for its
services as agreed and to reimburse the Warrant Agent upon request for all
reasonable out-of-pocket expenses incurred by it, including the reasonable
compensation and expenses of the Warrant Agent's agents and counsel as agreed.
The Company shall indemnify the Warrant Agent, its officers, directors, agents
and counsel against any loss, liability or expense (including reasonable agents'
and attorneys' fees and expenses) incurred by it without negligence, willful
misconduct or bad faith on its part arising out of or in connection with the
acceptance or performance of its duties under this Agreement. The Warrant Agent
shall notify the Company promptly of any claim for which it may seek indemnity.
The Company need not reimburse any expense or indemnify against any loss or
liability incurred by the Warrant Agent through wilful misconduct, negligence or
bad faith. The Company's payment obligations pursuant to this Section 6.05 shall
survive the termination of this Agreement.
To secure the Company's payment obligations under this
Agreement, the Warrant Agent shall have a lien prior to the Holders on all money
or property held or collected by the Warrant Agent.
SECTION 6.06. Successor Warrant Agent. (a) The Company To
Provide and Maintain Warrant Agent. The Company agrees for the benefit of the
Holders that there shall at all times be a Warrant Agent hereunder until all the
Warrants have been exercised or cancelled or are no longer exercisable. Any
Warrant Agent to qualify as the Warrant Agent hereunder must be able to qualify
as the trustee under the indenture relating to the Notes.
(b) Resignation and Removal. The Warrant Agent may at any time
resign by giving written notice to the Company of such intention on its part,
specifying the date on which its desired resignation shall become effective;
provided, however, that such date shall not be less than 60 days after the date
on which such notice is given unless the Company otherwise agrees. The Warrant
Agent hereunder may be removed at any time by the filing with it of an
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instrument in writing signed by or on behalf of the Company and specifying such
removal and the date when it shall become effective, which date shall not be
less than 60 days after such notice is given unless the Warrant Agent otherwise
agrees. Any removal under this Section 6.06 shall take effect upon the
appointment by the Company as hereinafter provided of a successor Warrant Agent
(which shall be a bank or trust company authorized under the laws of the
jurisdiction of its organization to exercise corporate trust powers) and the
acceptance of such appointment by such successor Warrant Agent.
(c) The Company To Appoint Successor. In the event that at any
time the Warrant Agent shall resign, or shall be removed, or shall become
incapable of acting, or shall be adjudged bankrupt or insolvent, or shall
commence a voluntary case under the Federal bankruptcy laws, as now or hereafter
constituted, or under any other applicable U.S. Federal or state bankruptcy,
insolvency or similar law or shall consent to the appointment of or taking
possession by a receiver, custodian, liquidator, assignee, trustee, sequestrator
(or other similar official) of the Warrant Agent or its property or affairs, or
shall make an assignment for the benefit of creditors, or shall admit in writing
its inability to pay its debts generally as they become due, or shall take
corporate action in furtherance of any such action, or a decree or order for
relief by a court having jurisdiction in the premises shall have been entered in
respect of the Warrant Agent in an involuntary case under the Federal bankruptcy
laws, as now or hereafter constituted, or any other applicable Federal or state
bankruptcy, insolvency or similar law, or a decree or order by a court having
jurisdiction in the premises shall have been entered for the appointment of a
receiver, custodian, liquidator, assignee, trustee, sequestrator (or similar
official) of the Warrant Agent or of its property or affairs, or any public
officer shall take charge or control of the Warrant Agent or of its property or
affairs for the purpose of rehabilitation, conservation, winding up or
liquidation, a successor Warrant Agent, qualified as aforesaid, shall be
appointed by the Company by an instrument in writing, filed with the successor
Warrant Agent. Upon the appointment as aforesaid of a successor Warrant Agent
and acceptance by the successor Warrant Agent of such appointment, the Warrant
Agent shall cease to be Warrant Agent hereunder; provided, however, that in the
event of the resignation of the Warrant Agent under this subsection (c), such
resignation shall be effective on the earlier of (i) the date specified in the
Warrant Agent's notice of resignation and (ii) the appointment and acceptance of
a successor Warrant Agent hereunder.
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(d) Successor To Expressly Assume Duties. Any successor
Warrant Agent appointed hereunder shall execute, acknowledge and deliver to its
predecessor and to the Company an instrument accepting such appointment
hereunder, and thereupon such successor Warrant Agent, without any further act,
deed or conveyance, shall become vested with all the rights and obligations of
such predecessor with like effect as if originally named as Warrant Agent
hereunder, and such predecessor, upon payment of its charges and disbursements
then unpaid, shall thereupon become obligated to transfer, deliver and pay over,
and such successor Warrant Agent shall be entitled to receive, all monies,
securities and other property on deposit with or held by such predecessor, as
Warrant Agent hereunder.
(e) Successor by Merger. Any corporation into which the
Warrant Agent hereunder may be merged or consolidated, or any corporation
resulting from any merger or consolidation to which the Warrant Agent shall be a
party, or any corporation to which the Warrant Agent shall sell or otherwise
transfer all or substantially all of its assets and business; provided, however,
that it shall be qualified as aforesaid, shall be the successor Warrant Agent
under this Agreement without the execution or filing of any paper or any further
act on the part of any of the parties hereto.
ARTICLE VII
Miscellaneous
SECTION 7.01. SEC Reports. The Company shall file with the
Warrant Agent for the benefit of the Holders of Warrants, within 15 days after
it files them with the SEC, copies of its annual and quarterly reports and other
information, documents and other reports (or copies of such portions of any of
the foregoing as the SEC may by rules and regulations prescribe) which the
Company is required to file with the SEC pursuant to Section 13 or 15(d) of the
Exchange Act. Notwithstanding that the Company may not be subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act, the Company
shall file with the SEC (to the extent the SEC will accept such filings) and
provide the Warrant Agent and Holders with such annual reports and such
information, documents and other reports as are specified in Sections 13 and
15(d) of the Exchange Act and applicable to a U.S. corporation subject to such
Sections, such information, documents and other reports to be so filed and
provided at the times specified for the filing of such information, documents
and reports under such Sections.
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SECTION 7.02. Persons Benefitting. Nothing in this Agreement
is intended or shall be construed to confer upon any Person other than the
Company, the Warrant Agent and the Holders any right, remedy or claim under or
by reason of this Agreement or any part hereof.
SECTION 7.03. Rights of Holders. Holders of unexercised
Warrants are not entitled to (i) receive dividends or other distributions, (ii)
receive notice of or vote at any meeting of the stockholders, (iii) consent to
any action of the stockholders, (iv) receive notice of any other proceedings of
the Company, (v) exercise any preemptive right or (vi) exercise any other rights
whatsoever as stockholders of the Company.
SECTION 7.04. Amendment. This Agreement may be amended by the
parties hereto without the consent of any Holder for the purpose of curing any
ambiguity, or of curing, correcting or supplementing any defective provision
contained herein or adding or changing any other provisions with respect to
matters or questions arising under this Agreement as the Company and the Warrant
Agent may deem necessary or desirable (including without limitation any addition
or modification to provide for compliance with the transfer restrictions set
forth herein); provided, however, that such action shall not adversely affect
the rights of any of the Holders. Any amendment or supplement to this Agreement
that has an adverse effect on the interests of the Holders shall require the
written consent of the Holders of a majority of the then outstanding Warrants.
The consent of each Holder affected shall be required for any amendment pursuant
to which the Exercise Price would be increased or the number of Warrant Shares
issuable upon exercise of Warrants would be decreased (other than pursuant to
adjustments provided for herein). In determining whether the Holders of the
required number of Warrants have concurred in any direction, waiver or consent,
Warrants owned by the Company or by any Person directly or indirectly
controlling or controlled by or under direct or indirect common control with the
Company shall be disregarded and deemed not to be outstanding, except that, for
the purpose of determining whether the Warrant Agent shall be protected in
relying on any such direction, waiver or consent, only Warrants which the
Warrant Agent knows are so owned shall be so disregarded. Also, subject to the
foregoing, only Warrants outstanding at the time shall be considered in any such
determination.
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SECTION 7.05. Notices. Any notice or communication shall be in
writing and delivered in Person or mailed by first-class mail addressed as
follows:
if to the Company:
TravelCenters of America, Inc.
00000 Xxxxxx Xxxxx Xxxx
Xxxxx 000
Xxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: General Counsel
with a copy to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Rise X. Xxxxxx, Esq.
if to the Warrant Agent:
State Street Bank and Trust Company
000 Xxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Corporate Trust Department -
TravelCenters
Xxxxxxx & Xxxxxxx, LLP
Xxx Xxxxxxxx Xxx
Xxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxxx Xxxxxx
The Company or the Warrant Agent by notice to the other may
designate additional or different addresses for subsequent notices or
communications.
Any notice or communication mailed to a Holder shall be mailed
to the Holder at the Holder's address as it
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appears on the Certificate Register and shall be sufficiently given if so
mailed within the time prescribed.
Failure to mail a notice or communication to a Holder or any
defect in it shall not affect its sufficiency with respect to other Holders. If
a notice or communication is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it.
SECTION 7.06. Governing Law. The laws of the State of New York
shall govern this Agreement and the Warrant Certificates.
SECTION 7.07. Successors. All agreements of the Company in
this Agreement and the Warrant Certificates shall bind its successors. All
agreements of the Warrant Agent in this Agreement shall bind its successors.
SECTION 7.08. Multiple Originals. The parties may sign any
number of copies of this Agreement. Each signed copy shall be an original, but
all of them together represent the same agreement. One signed copy is enough to
prove this Agreement.
SECTION 7.09. Table of Contents. The table of contents and
headings of the Articles and Sections of this Agreement have been inserted for
convenience of reference only, are not intended to be considered a part hereof
and shall not modify or restrict any of the terms or provisions hereof.
SECTION 7.10. Severability. The provisions of this Agreement
are severable, and if any clause or provision shall be held invalid, illegal or
unenforceable in whole or in part in any jurisdiction, then such invalidity or
unenforceability shall affect in that jurisdiction only such clause or
provision, or part thereof, and shall not in any manner affect such clause or
provision in any other jurisdiction or any other clause or provision of this
Agreement in any jurisdiction.
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IN WITNESS WHEREOF, the parties have caused this Warrant
Agreement to be duly executed as of the date first written above.
TRAVELCENTERS OF AMERICA,
INC.,
by /s/ Xxxxx X. Xxxxxx
-------------------------------
Name: Xxxxx X. Xxxxxx
Title: Senior Vice President and
Chief Financial Officer
STATE STREET BANK AND TRUST
COMPANY, as Warrant Agent,
by /s/ Xxxxx X. Xxxxxx
-------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
52
EXHIBIT A
[FORM OF FACE OF WARRANT CERTIFICATE]
[Separability Legend]
THE WARRANTS EVIDENCED BY THIS CERTIFICATE WERE INITIALLY ISSUED AS
PART OF AN ISSUANCE OF UNITS, EACH OF WHICH CONSISTS OF ONE 12 3/4% SENIOR
SUBORDINATED NOTE DUE MAY 1, 0000 XX XXXXXXXXXXXXX XX XXXXXXX, INC. (THE
"COMPANY") WITH A PRINCIPAL AMOUNT OF $1,000 (A "NOTE"), THREE INITIAL WARRANTS
AND ONE CONTINGENT WARRANT (TOGETHER, THE "WARRANTS") EACH TO PURCHASE 0.36469
SHARES OF COMMON STOCK, PAR VALUE $.00001 PER SHARE, OF THE COMPANY. THE NOTES
AND WARRANTS WILL NOT TRADE SEPARATELY UNTIL THE EARLIEST OF (A) THE
COMMENCEMENT OF A REGISTERED EXCHANGE OFFER FOR THE NOTES, (B) THE EFFECTIVENESS
OF A SHELF REGISTRATION STATEMENT WITH RESPECT TO THE NOTES AND (C) SUCH DATE
AFTER DECEMBER 14, 2000, AS THE INITIAL PURCHASERS MAY DETERMINE.
[Initial Warrant Legend]
THIS INITIAL WARRANTS EVIDENCED BY THIS CERTIFICATE WILL NOT TRADE
SEPARATELY FROM THE CONTINGENT WARRANTS UNTIL MARCH 31, 2003 (THE "CONTINGENT
WARRANT RELEASE DATE"). THE CONTINGENT WARRANTS WILL BE HELD IN ESCROW UNTIL
SUCH TIME.
[Contingent Warrant Legend]
THE WARRANTS EVIDENCED BY THIS CERTIFICATE ARE CONTINGENT WARRANTS AND
WILL NOT TRADE SEPARATELY FROM THE INITIAL WARRANTS UNTIL MARCH 31, 2003 (THE
"CONTINGENT WARRANT RELEASE DATE"). THESE CONTINGENT WARRANTS WILL BE HELD IN
ESCROW UNTIL SUCH TIME.
[Global Securities Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW
YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND
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TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE
IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE WARRANT AGREEMENT REFERRED
TO ON THE REVERSE HEREOF.
[Restricted Securities Legend]
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND THIS SECURITY MAY NOT BE OFFERED,
SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY
NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM
THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A
THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT
(A) THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY
(I) TO THE COMPANY, (II) INSIDE THE UNITED STATES TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A, (III) OUTSIDE THE UNITED STATES IN A TRANSACTION IN ACCORDANCE WITH RULE
904 UNDER THE SECURITIES ACT, (IV) PURSUANT TO AN EXEMPTION FROM REGISTRATION
UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (V)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN
EACH OF CASES (I) THROUGH (V) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS
OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION, AND (B)
THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER
OF THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.
HEDGING TRANSACTIONS INVOLVING THE WARRANTS OR THE COMMON STOCK
UNDERLYING THE WARRANTS MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE
SECURITIES ACT AND THE RULES AND REGULATIONS ISSUED THEREUNDER.
THE WARRANTS EVIDENCED BY THIS CERTIFICATE AND THE COMMON STOCK TO BE
ISSUED UPON THEIR EXERCISE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT AND
THE WARRANTS MAY NOT BE EXERCISED BY OR ON BEHALF OF ANY U.S. PERSON UNLESS
REGISTERED UNDER THE SECURITIES ACT OR AN EXEMPTION FROM SUCH REGISTRATION IS
AVAILABLE.
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No. [ ] Certificate for [ ] Warrants
WARRANTS TO PURCHASE COMMON STOCK OF
TRAVELCENTERS OF AMERICA, INC.
THIS CERTIFIES THAT [ ], or its registered assigns, is the
registered holder of the number of Warrants set forth above (the "Warrants").
Each Warrant entitles the holder thereof (the "Holder"), at its option and
subject to the provisions contained herein and in the Warrant Agreement referred
to below, to purchase from TRAVELCENTERS OF AMERICA, INC., a Delaware
corporation ("the Company"), 0.36469 shares of Common Stock, par value of
$0.00001 per share, of the Company (the "Common Stock") at the per share
exercise price of $0.001 (the "Exercise Price"), or by Cashless Exercise
referred to below. This Warrant Certificate shall terminate and become void as
of the close of business on May 1, 2009 (the "Expiration Date") or upon the
exercise hereof as to all the shares of Common Stock subject hereto [Insert for
Contingent Warrant - or upon the Contingent Warrant Release Date if the Release
Event shall not have occurred]. The number of shares issuable upon exercise of
the Warrants and the Exercise Price per share shall be subject to adjustment
from time to time as set forth in the Warrant Agreement.
This Warrant Certificate is issued under and in accordance
with a Warrant Agreement dated as of November 14, 2000 (the "Warrant
Agreement"), between the Company and State Street Bank and Trust Company (the
"Warrant Agent", which term includes any successor Warrant Agent under the
Warrant Agreement), and is subject to the terms and provisions contained in the
Warrant Agreement, to all of which terms and provisions the Holder of this
Warrant Certificate consents by acceptance hereof. The Warrant Agreement is
hereby incorporated herein by reference and made a part hereof. Reference is
hereby made to the Warrant Agreement for a full statement of the respective
rights, limitations of rights, duties and obligations of the Company, the
Warrant Agent and the Holders of the Warrants. Capitalized terms used but not
defined herein shall have the meanings ascribed thereto in the Warrant
Agreement. A copy of the Warrant Agreement may be obtained for inspection by the
Holder hereof upon written request to the Warrant Agent at 000 Xxxxxx Xxxxxx,
Xxxxxxxx, XX 00000, Attention: Corporate Trust Department.
Subject to the terms of the Warrant Agreement, the Warrants
may be exercised in whole or in part (i) by
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presentation of this Warrant Certificate with the Election to Purchase attached
hereto duly executed and with the simultaneous payment of the Exercise Price in
cash (subject to adjustment) to the Warrant Agent for the account of the Company
at the office of the Warrant Agent or (ii) by Cashless Exercise. Payment of the
Exercise Price in cash shall be made by certified or official bank check payable
to the order of the Company or by wire transfer of funds to an account
designated by the Company for such purpose. Payment by Cashless Exercise shall
be made without the payment of cash by reducing the amount of Common Stock that
would be obtainable upon the exercise of a Warrant and payment of the Exercise
Price in cash so as to yield a number of shares of Common Stock upon the
exercise of such Warrant equal to the product of (1) the number of shares of
Common Stock for which such Warrant is exercisable as of the Exercise Date (if
the Exercise Price were being paid in cash) and (2) a fraction, the numerator of
which is the excess of the Current Market Value per share of Common Stock on the
Exercise Date over the Exercise Price per share as of the Exercise Date and the
denominator of which is the Current Market Value per share of the Common Stock
on the Exercise Date.
As provided in the Warrant Agreement and subject to the terms
and conditions therein set forth, the Warrants shall be exercisable at any time
and from time to time on any Business Day after [Insert for Initial Warrant -
the first anniversary of the Issue Date] [Insert for Contingent Warrant - the
Contingent Warrant Release Date; provided that the Release Event has occurred;
provided, however, that Holders of Warrants will be able to exercise their
Warrants only if the Common Shelf Registration Statement relating to the Common
Stock underlying the Warrants is effective or the exercise of such Warrants is
exempt from the registration requirements of the Securities Act of 1933 and such
securities are qualified for sale or exempt from qualification under the
applicable securities laws of the states or other jurisdictions in which such
Holders reside; provided further, however, that no Warrant shall be exercisable
after May 1, 2009. [Insert for Contingent Warrant - "Release Event" means the
release of the Contingent Warrants from the escrow arrangements created by the
Contingent Warrant Escrow Agreement between the Company and State Street Bank
and Trust Company dated November 14, 2000 and distribution of the Contingent
Warrants to holders of the Initial Warrants as provided for in the Warrant
Agreement. "Contingent Warrant Release Date" means March 31, 2003.]
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In the event of a Combination, the Holder hereof will be
entitled to receive upon exercise of the Warrants the kind and amount of shares
of capital stock or other securities or other property as the Holder would have
received had the Holder exercised its Warrants immediately prior to such
Combination; provided, however, that in the event that, in connection with such
Combination, consideration to holders of Common Stock in exchange for their
shares is payable solely in cash or in the event of the dissolution, liquidation
or winding-up of the Company, the Holder hereof will be entitled to receive such
cash distributions on an equal basis with the holders of Common Stock or other
securities issuable upon exercise of the Warrants, as if the Warrants had been
exercised immediately prior to such Combination, less the Exercise Price.
As provided in the Warrant Agreement, the number of shares of
Common Stock issuable upon the exercise of the Warrants and the Exercise Price
are subject to adjustment upon the happening of certain events.
The Company may require payment of a sum sufficient to pay all
taxes, assessments or other governmental charges in connection with the transfer
or exchange of the Warrant Certificates pursuant to Section 2.04 of the Warrant
Agreement, but not for any exchange or original issuance (not involving a
transfer) with respect to temporary Warrant Certificates, the exercise of the
Warrants or the Warrant Shares.
Upon any partial exercise of the Warrants, there shall be
countersigned and issued to the Holder hereof a new Warrant Certificate
representing those Warrants which were not exercised. This Warrant Certificate
may be exchanged at the office of the Warrant Agent by presenting this Warrant
Certificate properly endorsed with a request to exchange this Warrant
Certificate for other Warrant Certificates evidencing an equal number of
Warrants. No fractional Warrant Shares will be issued upon the exercise of the
Warrants, but the Company shall pay an amount in cash equal to the Current
Market Value per Warrant Share on the day immediately preceding the date the
Warrant is exercised, multiplied by the fraction of a Warrant Share that would
be issuable on the exercise of any Warrant.
All shares of Common Stock issuable by the Company upon the
exercise of the Warrants shall, upon such issue, be duly and validly issued and
fully paid and non-assessable.
The holder in whose name the Warrant Certificate is registered
may be deemed and treated by the Company and
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the Warrant Agent as the absolute owner of the Warrant Certificate for all
purposes whatsoever and neither the Company nor the Warrant Agent shall be
affected by notice to the contrary.
The Warrants do not entitle any Holder hereof to any of the
rights of a stockholder of the Company.
This Warrant Certificate shall not be valid or obligatory for
any purpose until it shall have been counter signed by the Warrant Agent.
TRAVELCENTERS OF AMERICA,
INC.,
by ___________________________
Name:
Title:
by ___________________________
Name:
Title:
DATED:
Countersigned:
STATE STREET BANK AND TRUST COMPANY,
as Warrant Agent,
by
_______________________
Authorized Signatory
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FORM OF ELECTION TO PURCHASE WARRANT SHARES (to
be executed only upon exercise of Warrants)
TRAVELCENTERS OF AMERICA, INC.
The undersigned hereby irrevocably elects to exercise
__________________ Warrants to acquire shares of Common Stock, par value
$0.00001 per share, of TRAVELCENTERS OF AMERICA, INC., at an exercise price per
share of Common Stock of $0.001, and otherwise on the terms and conditions
specified in the within Warrant Certificate and the Warrant Agreement therein
referred to, surrenders this Warrant Certificate and all right, title and
interest therein to TRAVELCENTERS OF AMERICA, INC. and directs that the shares
of Common Stock deliverable upon the exercise of such Warrants be registered or
placed in the name and at the address specified below and delivered thereto.
Date: ____________________________ , _______
____________________________(1)
(Signature of Owner)
________________________________
(Xxxxxx Xxxxxxx)
________________________________
(City) (State) (Zip Code)
Signature Guaranteed by:
________________________________
________
(1) The signature must correspond with the name as written upon the face of the
within Warrant Certificate in every particular, without alteration or
enlargement or any change whatever, and must be guaranteed by a national bank or
trust company or by a member firm of any national securities exchange.
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Securities and/or check to be issued to:
Please insert social security or identifying number:
Name:
Street Address:
City, State and Zip Code:
A new Warrant Certificate evidencing any unexercised Warrants evidenced by the
within Warrant Certificate is to be issued to:
Please insert social security or identifying number:
Name:
Street Address:
City, State and Zip Code:
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9
In connection with any transfer of any of the Warrants
evidenced by this certificate occurring prior to the expiration of the period
referred to in Rule 144(k) under the Securities Act after the later of the date
of original issuance of such Warrants and the last date, if any, on which such
Warrants were owned by the Company or any Affiliate of the Company, the
undersigned certifies that such Warrants are being transferred in accordance
with its terms:
CHECK ONE BOX BELOW
(1) | | to the Company; or
(2) | | pursuant to an effective registration statement under
the Securities Act of 1933; or
(3) | | outside the United States in an offshore transaction
within the meaning of Regulation S under the Securities
Act in compliance with Rule 904 under the Securities
Act of 1933; or
(4) | | pursuant to Rule 144A under the Securities Act of 1933;
or
(5) | | pursuant to another available exemption from
registration provided by Rule 144 under the Securities
Act of 1933.
If such transfer is being made pursuant to an offshore
transaction in accordance with Rule 904 under the Securities Act, the
undersigned further certifies that:
(i) the offer of the Warrants was not made to a person in the
United States;
(ii) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting on
our behalf reasonably believed that the transferee was outside the
United States, or (b) the transaction was executed in, on or through
the facilities of a designated offshore securities market and neither
we nor any person acting on our behalf knows that the transaction has
been pre-arranged with a buyer in the United States;
(iii) no directed selling efforts have been made in the United
States in contravention of the requirements of Rule 903 or Rule 904 of
Regulation S, as applicable;
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(iv) the transaction is not part of a plan or scheme to evade
the registration requirements of the Securities Act;
(v) we have advised the transferee of the transfer
restrictions applicable to the Warrants;
(vi) if the circumstances set forth in Rule 904(b)(1) under
the Securities Act are applicable, either (a) neither we nor any person
acting on our behalf knows that the transferee is a U.S. person or (b)
we have complied with the additional conditions therein, including (if
applicable) sending a confirmation or other notice stating that the
Warrants may be offered and sold during the distribution compliance
period specified in Rule 903 of Regulation S only in accordance with
Regulation S; pursuant to registration of the Warrants under the
Securities Act; or pursuant to an available exemption from the
registration requirements under the Securities Act; and
(vii) we have advised the transferee that hedging transactions
involving the Units or the Warrants may not be conducted unless in
compliance with the Securities Act.
Unless one of the boxes is checked, the Warrant Agent will
refuse to register any of the Warrants evidenced by this certificate in the name
of any person other than the registered holder thereof; provided, however, that
if box (3) or (4) is checked, the Warrant Agent may require, prior to
registering any such transfer of the Warrants, such legal opinions, additional
certifications and other information as the Company has reasonably requested to
confirm that such transfer is being made pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the Securities Act
of 1933, such as the exemption provided by Rule 144 under such Act.
____________________________
Signature
Signature Guarantee:
____________________________ ____________________________
Signature must be guaranteed Signature
________________________________________________________________________________
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SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY(2)
The following increases or decreases in this Global Security:
Number of
Warrants in Signature
Decrease in Increase in this Global of
number of number of Warrant authorized
Warrants in Warrants in Certificate officer of
Date of this Global this Global following Warrant
Exchange Security Security such change Agent
-------- ----------- ----------- ----------- ----------
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(2) To be included only if the Warrant is in global form.
