THIS WARRANT, AND THE WARRANT SHARES ISSUABLE UPON
EXERCISE HEREOF, HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND MAY BE TRANS-
FERRED ONLY IN ACCORDANCE WITH SECTION 5 OF THIS WARRANT.
THIS WARRANT, AND THE WARRANT SHARES ISSUABLE UPON EXER-
CISE HEREOF, ARE ALSO SUBJECT TO THE STOCKHOLDER
AGREEMENT, DATED AS OF JANUARY 30, 1995, AMONG CDI GROUP,
INC., BANCBOSTON VENTURES INC., HARVEST TECHNOLOGY
PARTNERS, L.P. AND THE OTHER PARTIES SIGNATORY THERETO. A
COPY OF SUCH STOCKHOLDER AGREEMENT WILL BE FURNISHED
WITHOUT CHARGE BY THE COMPANY TO THE HOLDER HEREOF UPON
WRITTEN REQUEST.
COMMON STOCK PURCHASE WARRANT
Representing Rights To Purchase 16,667 Warrant Shares of Class A Common
Stock of CDI Group, Inc.
WARRANT NO. 1
This certifies that, for value received, Banque Paribas, acting through its
Cayman Islands Branch, ("Paribas") and its successors or assigns (the "Holder")
is entitled, subject to the terms and conditions hereinafter set forth at any
time and from time to time until January 30, 2005 or, in the event that on such
date the holder shall not have received 30 days prior written notice of the
expiration of the Period of the Warrants pursuant to Section 8(g), such later
date on which the Holder shall have had such notice of the expiration of the
Exercise Period for at least 3 consecutive days (the "Expiration Date") to
purchase up to a total of 16,667 shares (as such number of shares may be
adjusted pursuant to Section 7, the "Warrant Shares") of Class A Common Stock,
at a price per share equal to the Exercise Price in lawful funds of the United
States of America. This Warrant is issued to the Holder (together with such
other warrants as may be issued in exchange, transfer or replacement of this
Warrant, the "Warrants") and entitles the Holder to purchase the Warrant Shares.
This Warrant is subject to the following further terms and conditions:
1. DEFINITIONS
"Affiliate" shall have the meaning given such term in the Credit Agreement.
"Bank" shall mean any financial institution constituting a "Bank" pursuant
to the terms of the Credit Agreement.
"Borrower" shall mean Community Distributors, Inc., as surviving
corporation of the merger of NewRxCo. Inc. with and into Community Distributors.
Inc., a Delaware corporation.
"Class A Common Stock" shall mean the Company's authorized Class A Voting
Common Stock, $.00001 par value per share.
"Class B Common Stock" shall mean the Company's authorized Class B
Non-Voting Common Stock, $.00001 par value per share.
"Commission" shall mean the Securities and Exchange Commission and any
other similar or successor agency of the federal government of the United States
of America then administering the Securities Act or the Exchange Act.
"Common Stock" shall mean and include each of the Company's authorized
Class A Common Stock and Class B Common Stock as constituted at the Date of
Issuance.
"Company" shall mean CDI Group, Inc., a Delaware corporation, together with
any corporation which shall succeed tore the obligations hereunder of the
Company.
"Credit Agreement" shall mean the Credit Agreement, dated as of January 30,
1995, among the Company, the Borrower, the Banks and Banque Paribas, as Agent,
as such agreement may be amended, modified or supplemented from time to time.
"Credit Agreement Debt" shall have the meaning given to such term in
Section 8.1(i). "Date of Issuance" shall have the meaning given to such term in
Section 11.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended,
or any similar or successor federal statute, and the rules and regulations
thereunder of the Commission or any other federal agency then administering the
Exchange Act, all as the same shall be in effect at the time.
"Exercise Agreement" shall have the meaning given to such term in Section
4.3
"Exercise Event" shall have the meaning given to such term in Section 4.1.
"Exercise Period" shall have the meaning given to such term in Section 4.1.
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"Exercise Price" shall mean $.001 per Warrant Share as adjusted as provided
for herein.
"Exercise Time" shall have the meaning given to such term in Section
4.2(a).
"Expiration Date" shall have the meaning given to such term in the preamble
hereto.
"Holder" shall have the meaning given to such term in the preamble hereto.
"Investor Securities Purchase Agreement" shall mean the Investor Securities
Purchase Agreement, dated as of January 30, 1995, among the Company, the
Investors and the other parties signatory thereto, as such Agreement shall be
amended, modified, and supplemented from time to time in accordance with the
provisions thereof.
"Investors" shall mean BancBoston Ventures Inc. and Harvest Technology
Partners, L.P.
"Majority of the Warrant Interests" shall mean the Holders of a majority of
all Warrant Shares (assuming the exercise of all Warrants).
"Offering Price" shall have the meaning given to such term in Section
7.1(b).
"OID" shall have the meaning given to such term in Section 8.l(f)
"Paribas" shall have the meaning given to such term in the preamble hereto.
"Persons" shall mean a corporation, an association, a partnership, an
organization, a business, an individual or a government or political subdivision
thereof or any governmental agency.
"Registration Rights Agreement" shall mean the Registration Rights
Agreement, dated as of January 30, 1995, among the Company, the Investors and
the other parties signatory thereto, as such agreement shall be amended,
modified and supplemented from time to time in accordance with the provisions
thereof.
"Regulation Y" shall mean Regulation Y of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor to all
or a portion thereof.
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"Rights" shall have the meaning given to such term in Section 7.1(b).
"Securities Act" shall mean the Securities Act of 1933, as amended, or any
similar federal statute, and the rules and regulations thereunder of the
Commission or any other federal agency then administering the Securities Act,
all as the same shall be in effect at the time.
"Shareholders Agreement" shall mean the Stockholder Agreement, dated as of
January 30, 1995 among the Company, the Investors and the other parties
signatory thereto, as the same may be modified, supplemented or amended from
time to time pursuant to the terms thereof.
"Transfers shall include any sale, transfer, assignment or other
disposition of this Warrant or Warrant Shares, or of any interest in either
thereof, which would constitute a sale thereof within the meaning of the
Securities Act.
"Warrant" shall have the meaning given such term in the preamble hereto.
"Warrant Shares" shall have the meaning given to such term in the preamble
hereto.
All terms used in this Warrant which are not defined in this Section 1 have
the meanings respectively set forth therefor elsewhere in this Warrant.
2. OWNERSHIP OF THIS WARRANT
The Company may deem and treat the Person in whose name this Warrant is
registered as the Holder and owner hereof for all purposes, notwithstanding any
notations of ownership or writing made hereon by anyone other than the Company,
and shall not be affected by any notice to the contrary, until presentation of
this Warrant for registration or transfer as provided in Section 3. The Company
shall maintain at its chief executive office, a register for the Warrants, in
which the Company shall record the name and address of the Person in whose name
each Warrant has been issued, as well as the name and address of each transferee
and each prior owner of such Warrant. Within five days after the Holder shall by
written notice to the Company request the same, the Company will deliver to such
Holder a certificate signed by one of its officers, listing the names and
addresses of every other Holder, as such information appears in said register
and in the stock transfer books of the Company at the close of business on the
day before such certificate is signed.
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3. EXCHANGE, TRANSFER AND REPLACEMENT
This Warrant is exchangeable, upon the surrender hereof by the registered
Holder to the Company at its office provided for in Section 2, for new Warrants
of same tenor, representing in the aggregate the right to purchase the number of
Warrant Shares purchasable hereunder, each of such new Warrants to represent the
right to purchase such number of Warrant Shares as shall be designated by said
registered Holder at the time of such surrender. Subject to Section 5 hereof,
this Warrant and all rights hereunder are transferable, in whole or in part,
only upon the register of this Warrant provided for in Section 2, by the
registered Holder hereof in person or by duly authorized attorney, and a new
Warrant shall be made and delivered by the Company, of the same tenor as this
Warrant but registered in the name of the transferee, upon surrender of this
Warrant together with a duly completed assignment, in the form attached hereto
as Exhibit A, at the office of the Company where the register provided for in
Section 2 is maintained. Upon receipt by the Company at its office provided for
in Section 2 of evidence reasonably satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant, and, in the case of loss, theft or
destruction, of indemnity or security reasonably satisfactory to it, and upon
surrender of this Warrant, if mutilated, the Company will make and deliver a new
Warrant of same tenor in replacement of this Warrant, provided, if a Person
having net assets in excess of $10,000,000 (as disclosed in its last audited
financial statement) shall be the registered Holder, an agreement of indemnity
by it shall be sufficient for all purposes of this Section 3. This Warrant shall
be promptly cancelled by the Company upon the surrender thereof in connection
with any exchange, transfer or replacement. The Company shall pay all taxes
(other than securities transfer taxes which shall be paid by Holder) and all
other expenses and charges payable in connection with the preparation, execution
and delivery of Warrants pursuant to this Section 3.
4. EXERCISE RIGHTS
4.1. Exercise Period. The Holder may in its sole discretion exercise (an
"Exercise Event"), in whole or in part, the purchase rights represented by this
Warrant at any time and from time to time on or after the date hereof and until
the Expiration Date (the "Exercise Period").
4.2. Exercise Procedure. (a) An Exercise Event shall have been deemed to
have occurred as of the time during the Exercise Period when the Company has
received all of the following items (the "Exercise Times"):
(i) a completed Exercise Agreement, as described in Section 4.3 below,
executed by the registered Holder;
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(ii) this Warrant; and
(iii) payment in an amount equal to the Exercise Price for the Warrant
Shares for which this Warrant is being exercised in cash, or by a certified or
official bank check, or by any combination thereof.
(b) Certificates for Warrant Shares purchased upon exercise of this Warrant
will be delivered by the Company to the registered Holder within three business
days after the date of the Exercise Time. Unless this Warrant has expired or all
of the purchase rights represented hereby have been exercised, the Company will
prepare a new Warrant, substantially identical hereto, representing the rights
formerly represented by this Warrant which have not expired or been exercised
and will, within such three-day period, deliver such new Warrant to the
registered Holder.
(c) The Warrant Shares issuable upon exercise of this Warrant, shall, when
issued, and after payment therefor pursuant to Section 4.2(a)(iii), be duly
authorized, validly issued, fully paid, and nonassessable and will be free from
all liens and encumbrances with respect thereto.
(d) The Warrant Shares issuable upon the exercise of this Warrant will be
deemed to have been issued at the Exercise Time, and the Person or Persons in
whose name or names such Warrant Shares are registered will be deemed for all
purposes to have become the record holder of such Warrant Shares at the Exercise
Time.
(e) The issuance of certificates for Warrant Shares upon exercise of this
Warrant will be made without charge to the Holder for any issuance tax in
respect thereof or other cost incurred by the Company in connection with such
exercise and the related issuance of Warrant Shares; provided, however, in the
event that Warrant Shares are to be issued to a person other than the person in
whose name the Warrant being exercised is registered, then the person requesting
such exercise shall pay any transfer or other taxes required by reason of the
issuance of Warrant Shares to a person other than the registered holder of the
Warrant surrendered thereby unless it is established to the satisfaction of the
Company that such tax has been paid or is not applicable.
(f) The Company will not close its books against the transfer of this
Warrant or of any of the Warrant Shares in any manner which interferes with the
timely exercise of this Warrant. The Company will from time to time take all
such action as may be necessary to assure that the par value per share of the
unissued Warrant Shares acquirable upon exercise of this Warrant is at all times
equal to or less than the Exercise Price then in effect.
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4.3. Exercise Agreement. Upon any exercise of this Warrant, the Exercise
Agreement will be substantially in the form set forth in Exhibit B hereto (the
"Exercise Agreements), except that if the Warrant Shares are not to be issued in
the name of the registered Holder, the Exercise Agreement will also state the
name or names of the Person or Persons to whom the certificates for the Warrant
Shares are to be issued, and the registered Holder shall comply with Sections
5.1 and 5.2 hereof in connection therewith. Such Exercise Agreement will be
dated the actual date of execution thereof.
5. TRANSFER
5.1. Restrictions on Transfer Generally. Notwithstanding any provisions
contained in this Warrant to the contrary, this Warrant shall not be Transferred
other than to an Affiliate of the Holder, to any Bank (or an Affiliate of any
Bank) or to any member of the consolidated group of Compagnie Financiere de
Paribas or any officer or employee of any member of the consolidated group of
Compagnie Financiere de Paribas and the related Warrant Shares shall not either
be issuable to any Person other than the registered Holder, an Affiliate of such
Holder, any Bank (or an Affiliate of any Bank), any member of the consolidated
group of Compagnie Financiere de Paribas, or any officer or employee of any
member of the consolidated group of Compagnie Financiere de Paribas, or
Transferable by the registered owner thereof other to an Affiliate of the
Holder, to any Bank (or an Affiliate of any Bank) or to the consolidated group
of Compagnie Financiere de Paribas or any officer or employee of any member of
the consolidated group of Compagnie Financiere Paribas, except upon satisfaction
of the conditions specified in this Section 5.1. Such condition is intended to
insure compliance with the provisions of the Securities Act in respect of the
exercise of this Warrant or Transfer of this Warrant or any Warrant Shares. The
registered Holder of this Warrant, and each registered owner of Warrant Shares,
agrees that it will not, in each case, prior to delivery to the Company of the
opinion of the counsel referred to in, and to the effect described in, Section
5.2, to the extent such opinion has been requested by the Company, or until
registration under the Securities Act of this Warrant and all related Warrant
Shares has become effective: (i) Transfer this Warrant other than to an
Affiliate of the Holder, to any Bank (or an Affiliate of any Bank) or to any
member of the consolidated group of Compagnie Financiere de Paribas or any
officer or employee of any member of the consolidated group of Compagnie
Financiere de Paribas; (ii) request the issuance to any Person, other than the
registered Holder, an Affiliate of such Holder, any Bank (or an Affiliate of any
Bank) any member of the consolidated group of Compagnie Financiere de Paribas,
or any officer or employee of any member of the consolidated group of Compagnie
Financiere de Paribas, of Warrant Shares issuable upon exercise of this Warrant;
or (iii) Transfer other than to an Affiliate of the Holder, to any Bank (or an
Affiliate of any Bank) or to any member of the consolidated group of Compagnie
Financiere de Paribas or any
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officer or employee of any member of the consolidated group of Compagnie
Financiere de Paribas any Warrant Shares.
5.2. Opinions of Counsel. So long as this Warrant, or any certificate for
Warrant Shares issued upon exercise of this Warrant, bears the legend required
by Section 5.4 hereof, the registered Holder of this Warrant and each registered
owner of any Warrant Shares agrees, by the acceptance thereof, that prior to any
Transfer other than to an Affiliate of the Holder, to any Bank (or an Affiliate
of any Bank) or to any member of the consolidated group of Compagnie Financiere
de Paribas or any officer or employee of any member of the consolidated group of
Compagnie Financiere de Paribas or attempted Transfer other than to an Affiliate
of the Holder, to any Bank (or an Affiliate of any Bank) or to any member of the
consolidated group of Compagnie Financiere de Paribas or any officer or employee
of any member of the consolidated group of Compagnie Financiere de Paribas
thereof it shall give written notice to the Company of such Person's intention
to effect such Transfer. Each such notice shall describe the manner and
circumstances of the proposed Transfer, and if in the Company's reasonable
opinion an exemption from registration under the Securities Act is not available
in connection with such Transfer, at the request of the Company, shall be
accompanied by an opinion of counsel, reasonably acceptable to the Company and
any transfer agent therefore, to the effect that such proposed Transfer may be
effected without registration under the Securities Act. If the proposed Transfer
may be effected without registration under the Securities Act, the Person giving
notice shall thereupon be entitled to consummate such Transfer in accordance
with the terms of the notice delivered by such Person to the Company upon
delivery to the Company of the written agreement of the proposed transferee to
become bound by the provisions of Sections 5.1 and 5.2 hereof and by the terms
of the Shareholders Agreement. Each Warrant or certificate evidencing Warrant
Shares, as the case may be, issued to a transferee in such Transfer shall bear
the legend set forth in Section 5.4 if required by such clause, unless such
legend is not required or appropriate in order to insure compliance with the
Securities Act.
5.3. Registration Rights and Other Rights. Each registered Holder of this
Warrant and each registered owner of Warrant Shares shall be entitled to the
benefits of and shall be subject to the obligations under the Shareholders
Agreement, the Registration Rights Agreement and the Investor Securities
Purchase Agreement (including, without limitation, information and access
rights, board observation rights, covenants and representations and warranties,
demand registration rights, piggy-back registration rights and tag-along
rights).
5.4. Legends. (a) Each Warrant issued in exchange, transfer, or replacement
of this Warrant shall (unless otherwise permitted by Section 5.2 hereof or
unless at such time as the Warrant shall have been transferred under an
effective registration statement under the Securities Act or pursuant to Rule
144 or 144A or any successor rules) be
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stamped or otherwise imprinted with a legend substantially in the form of the
legend appearing at the top of the first page of this Warrant.
(b) Each certificate for Warrant Shares shall (unless otherwise permitted
by Section 5.2 or unless such Warrant Shares shall have been transferred under
an effective registration statement under the Securities Act or pursuant to Rule
144 or 144A or any successor rules) be stamped or otherwise imprinted with a
legend in substantially the following form:
"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND THE
TRANSFER OF SAID SECURITIES IS SUBJECT TO THE
RESTRICTIONS SET FORTH IN SECTION 5 OF WARRANT NO. 1,
DATED AS OF JANUARY 30, 1995, OF CDI GROUP, INC. AND
DELIVERED TO THE REGISTERED HOLDER THEREOF, A COPY OF
WHICH IS AVAILABLE FOR INSPECTION AT THE HEAD OFFICE OF
CDI GROUP, INC., AND NO TRANSFER OF SAID SECURITIES
SHALL BE VALID OR EFFECTIVE UNLESS THE TERMS AND
CONDITIONS OF SAID SECTION 5 SHALL HAVE BEEN COMPLIED
WITH. THIS WARRANT, AND THE WARRANT SHARES ISSUABLE
UPON EXERCISE HEREOF, ARE ALSO SUBJECT TO THE
STOCKHOLDER AGREEMENT DATED AS OF JANUARY 30, 1995,
AMONG CDI GROUP, INC., BANCBOSTON VENTURES INC.,
HARVEST TECHNOLOGY PARTNERS, L.P. AND THE OTHER PARTIES
SIGNATORY THERETO. A COPY OF SUCH STOCKHOLDER AGREEMENT
WILL BE FURNISHED WITHOUT CHARGE BY THE COMPANY TO THE
HOLDER HEREOF UPON WRITTEN REQUEST.
(c) The provisions of Sections 5.1, 5.2 and this Section 5.4 shall be
binding upon all Holders and all subsequent holders of certificates for Warrant
Shares bearing the legend set forth in subsection (b) above.
5.5. Exchange of Certificates. As soon as possible after the effective date
of any registration statement under the Securities Act pursuant to the terms and
conditions contained in the Registration Rights Agreement, the Company will
deliver to the Holder of any Warrant or any Warrant Shares so registered, upon
demand of such holder and its delivery to the Company of a certificate or
certificates representing such Warrant or Warrant Shares bearing the legend set
forth in Section 5.4, a new certificate or certificates representing such
Warrant Shares but not bearing such legend.
-9-
5.6. Regulatory Sale or Disposition. Anything herein or in the Shareholders
Agreement to the contrary notwithstanding, in the event that any Holder or any
of the Holders' Affiliates shall deliver to the Company an opinion of counsel to
such Holder or such Affiliate, as the case may be, to the effect that if such
Holder or such Affiliate, as the case may be, shall continue to hold some or all
of the Warrants or its Warrant Shares or any other securities of the Company
held by it, there is a material risk that such ownership will result in the
violation of any statute, regulation or rule of any governmental authority
(including, without limitation, Regulation Y), such Holder or such Affiliate, as
the case may be, may sell or otherwise dispose of its Warrants or Warrant
Shares, as the case may be, in as prompt and orderly a manner as is reasonably
necessary. The Company shall cooperate with such Holder or such Affiliate, as
the case may be, in disposing of its Warrants or Warrant Shares, and (without
limiting the foregoing) at the request of such Holder or such Affiliate, as the
case may be, the Company shall provide (and authorize such Holder or such
Affiliate, as the case may be, to provide) financial and other information
concerning the Company to any prospective purchaser of the Warrants or Warrant
Shares owned by such Holder or such Affiliate, as the case may be, subject to
appropriate confidentiality arrangements satisfactory to the Company. The
provisions of this Section 5.6 shall inure solely to the benefit of the Holders
and their Affiliates which are subject to the provisions of the Bank Holding
Company Act of 1956, as amended (including Regulation Y promulgated thereunder).
Any sale or transfer of any Warrants or Warrant Interest pursuant to this
Section 5.6 shall be subject to the other provisions of this Section 5.
6. COMPANY'S ACKNOWLEDGMENT OF OBLIGATIONS
The Company will, at the time of any exercise of this Warrant, upon the
request of the Holder, acknowledge in writing its continuing obligation to
afford to any Holder of Warrant Shares all rights (including, without
limitation, all rights contained in the Shareholders Agreement, the Registration
Rights Agreement and the Investor Securities Purchase Agreement) to which such
holder shall continue to be entitled after such exercise in accordance with the
provisions of this Warrant; provided, however, that if the Holder shall fail to
make any such request, such failure shall not affect the continuing obligation
of the Company to afford to the Holder any such rights.
7. ADJUSTMENTS TO NUMBER OF WARRANT SHARES
7.1. Adjustment of Number of Warrant Shares. The number of Warrant Shares
purchasable pursuant hereto shall be subject to adjustment from time to time on
and after the Date of Issuance as hereinafter provided in this Section 7.1.
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(a) In case the Company shall at any time after the Date of Issuance (i)
declare or pay a dividend in shares of Common Stock or make a distribution in
shares of Common Stock, (ii) subdivide its outstanding shares of Common Stock,
(iii) combine its outstanding shares of Common Stock into a smaller number of
shares of Common Stock or (iv) issue any shares of its capital stock or other
assets in a reclassification or reorganization of the Common Stock (including
any such reclassification in connection with a consolidation or merger in which
the Company is the continuing entity), the securities purchasable pursuant
hereto shall be adjusted to the number of Warrant Shares and amount of any other
securities, cash or other property of the Company which such Holder would have
owned or have been entitled to receive after the happening of any of the events
described above, had this Warrant been exercised immediately prior to the
happening of such event or any record date with respect thereto. An adjustment
made pursuant to this paragraph (a) shall become effective immediately after the
effective date of such event retroactive to the record date, if any, for such
event. Any Warrant Shares purchasable as a result of such adjustment shall not
be issued prior to the effective date of such event.
(b) In case the Company shall issue shares of its Common Stock or issue
rights, options (including options issued to employees under the Company's 1995
Stock Option Plan on or after the date hereof) or warrants to subscribe for or
purchase, or other securities exchangeable for or convertible into, shares of
its Common Stock (any such rights, options, warrants or other securities being
herein called "Rights") (excluding (i) shares issued in a transaction covered by
Section 7.1 ((ii),) shares issued upon conversion, exercise, or exchange of
Rights issued after the date hereof (provided that appropriate adjustments were
made hereunder upon the issuance of such Rights) and (iii) the Warrants and any
Warrant Shares issued on exercise thereof at an issuance, subscription,
offering, exercise or conversion price (the "Offering Prices) per share which is
lower than the current market price per share of Common Stock (as defined in
paragraph (d) below) on the date of issuance or grant, whether or not such
Rights are immediately exercisable or convertible, the number of Warrant Shares
issuable hereunder after such issuance or grant shall be determined by
multiplying the number of Warrant Shares issuable hereunder immediately prior to
any adjustment in connection with such issuance or grant by a fraction, the
numerator of which shall be the number of shares of Common Stock outstanding
(exclusive of any treasury shares) immediately prior to the date of issuance or
grant of such shares of Common Stock or Rights (assuming that all Common Stock
into which all outstanding rights, options, warrants and convertible securities
excluding such Rights are exercisable or convertible is outstanding) plus the
number of additional shares of Common Stock issued and the number of shares of
Common Stock that would be issued upon exercise of such Rights, and of which the
denominator shall be the number of shares of Common Stock outstanding (exclusive
of any treasury shares) immediately prior to the date of issuance or grant of
such Common Stock or Rights (assuming that all Common Stock into which all
outstanding rights, options, warrants and convertible securities excluding such
Rights are exercisable or convertible is outstanding) plus the number of shares
which the
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aggregate Offering Price of the total number of shares of Common Stock so
offered would purchase at the current market price per share of Common Stock on
the date of issuance; provided that to the extent any such Rights, so issued
expire or are cancelled or redeemed without having been exercised or converted,
the number of Warrant Shares issuable hereunder shall again be adjusted to
reflect such expiration, cancellation or redemption of such Rights. Such
adjustment shall be made whenever such shares of Common Stock or Rights are
issued or granted. For purposes of this paragraph (b), the "Offering Price" per
share of Common Stock shall in the case of Rights be determined by dividing (x)
the total amount received or receivable by the Company in consideration of the
issuance of such Rights plus the total consideration payable to the Company upon
exercise thereof, by (y) the total number of shares of Common Stock covered by
such Rights.
(c) In case the Company shall distribute to any holder of its shares of
Common Stock or Rights, evidences of its indebtedness or assets (including
securities and cash dividends other than regular quarterly cash dividends paid
in the ordinary course of business out of the Company's consolidated earnings),
but excluding dividends or distributions referred to in paragraph (a) above or
Rights, referred to in paragraph (b) above (collectively, "Distributions"), then
in each case the number of Warrant Shares issuable hereunder after any such
Distribution shall be determined by multiplying the number of Warrant Shares
issuable hereunder prior to such Distribution by a fraction, the numerator of
which shall be the current market per share of Common Stock (as defined in
paragraph (d) below) on the record date for such distribution, and of which the
denominator shall be such current market price per share of Common Stock, less
the then fair market value (as reasonably determined in good faith by the Board
of Directors of the Company) of the portion of the assets or evidences of
indebtedness so distributed applicable to one share of Common Stock. Such
adjustments shall be made successively whenever any such Distribution is made
and shall become effective on the date of distribution retroactive to the record
date for the determination of stockholders entitled to receive such
Distribution. In the event that the Holders of a Majority of Warrant Interests
disagree with the Company's determination of the fair market value of any assets
or evidences of indebtedness pursuant to this subsection 7. l(c), then such fair
market value shall be determined by an independent appraisal firm (which may be
an investment banking firm of national recognition) selected by such Holders and
the Company (the "Appraisal Firm"). If the Appraisal Firm determines such fair
market value to be greater than 105% of the Company's determination, then the
Company shall bear the costs of the Appraisal Firm. If the Appraisal Firm
determines the current market value to be less than 105% of the Company's
determination, the Holders of the Warrant Interests shall reimburse the Company
for the cost of the Appraisal Firm.
(d) For the purpose of any computation under paragraphs (b) and (c) of this
Section, the current market price per share of Common Stock at any date shall be
the average of the daily closing prices for the 10 consecutive trading day prior
to the earlier
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to occur of (i) the date as of which the market price is to be computed or (ii)
the last full trading day before the commencement of "ex-dividend" trading in
the Common Stock relating to the event giving rise to the adjustment required by
paragraph (b) or (c). The closing price for each day shall be the last such
reported sales price regular way or, in case no such reported sale takes place
on such day, the average of the closing bid and asked prices regular way for
such day, in each case on the principal national securities exchange or in the
NASDAQ-National Market System on which the shares of Common Stock are listed or
to which such shares are admitted to trading, or, if not listed or admitted to
trading, the average of the closing bid and asked prices of the Common Stock in
the over-the-counter market as reported by NASDAQ or any comparable system, or
if the Common Stock is not listed on NASDAQ or a comparable system, the average
of the closing bid and asked prices as furnished by two members of the National
Association of Securities Dealers, Inc. selected from time to time by the a
Majority of the Warrant Interests for that purpose. In the event the Company's
Common Stock is not then publicly traded or if for any other reason the current
market price per share cannot be determined pursuant to the foregoing provisions
of this paragraph (d), the appropriate current market price per share shall be
the fair market value thereof (without regard to any transfer restrictions
imposed by law or contract thereon or lack of liquidity thereof) as determined
by the Board of Directors of the Company. In the event that the Holders of
Majority of Warrant Interests disagree with the Company's determination of the
current market price per share of Common Stock made pursuant to the immediately
preceding sentence, then such current market price or fair market value, as the
case may be, shall be determined by an independent appraisal firm (which may be
an investment banking firm of national recognition) selected by such Holders and
the Company (the "Appraisal Firm"). If the Appraisal Firm determines such fair
market value to be greater than 105% of the Company's determination, then the
Company shall bear the costs of the Appraisal Firm. If the Appraisal Firm
determines the current market value to be less than 105% of the Company's
determination, the Holders of the Warrant Interests shall reimburse the Company
for the cost of the Appraisal Firm.
(e) Whenever the numbers of Warrant Shares are adjusted as herein provided,
the Exercise Price payable upon exercise of this Warrant shall be adjusted by
multiplying such Exercise Price immediately prior to such adjustment by a
fraction, of which the numerator shall be the number of Warrant Shares
immediately prior to such adjustment, and of which the denominator shall be the
number of Warrant Shares immediately thereafter.
(f) No adjustment in the number of Warrant Shares shall be required
hereunder unless such adjustment would result in an increase or decrease of at
least one percent (1%) of the Exercise Price; provided, however, that any
adjustments which by reason of this paragraph (f) are not required to be made
shall be carried forward and taken into account in any subsequent adjustment.
All calculations shall be made to the nearest one-hundredth of a cent or to the
nearest one-thousandth of a share, as the case may be.
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(g) For the purpose of this subsection 7.1, the term "shares of Common
Stock" shall mean (i) the classes of stock designated as the Common Stock of the
Company at the date of this Agreement, (ii) any other class of stock resulting
from successive changes or reclassifications of such shares consisting solely of
changes in par value, or from par value to no par value, or from no par value to
par value or (iii) any other class of capital stock of the Company which is not
by its terms restricted in amount or timing to the entitlement to dividends or
in the distribution of assets upon the voluntary or involuntary liquidation,
dissolution or winding up of the Company. In the event that at any time, as a
result of an adjustment made pursuant to this subsection 7.1, the Holders shall
become entitled to receive any securities of the Company other than shares of
Common Stock, thereafter the number of such other securities so receivable upon
exercise of this Warrant and the Exercise Price of such shares shall be subject
to adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to the Warrant Shares contained in
this Section 7.
7.2. Reorganization, Merger, etc. If any capital reorganization,
reclassification or similar transaction involving the capital stock of the
Company (other than as specified in Section 7.1(a)), any consolidation, merger
or business combination of the Company with another corporation, or the sale or
conveyance of all or any substantial part of the assets of the Company to
another corporation, shall be effected in such a way that holders of the Common
Stock shall be entitled to receive stock, securities or assets (including,
without limitation, cash) with respect to or in exchange for shares of the
Common Stock, then, prior to and as a condition of such reorganization,
reclassification, similar transaction, consolidation, merger, business
combination, sale or conveyance, lawful and adequate provision shall be made
whereby the Holder shall thereafter have the right to purchase upon exercise of
this Warrant and payment of the Exercise Price in effect immediately prior to
such action, the kind and amount of shares of stock, securities or assets which
he would have owned or been entitled to receive after the happening of such
reorganization, reclassification, similar transaction, consolidation, merger,
business combination, sale or conveyance had this Warrant been exercised
immediately prior to such transaction. The Company shall not effect any such
consolidation, merger, business combination, sale or conveyance unless prior to
or simultaneously with the consummation thereof the survivor or successor
corporation (if other than the Company) resulting from such consolidation or
merger or the corporation purchasing such assets shall assume by written
instrument executed and sent to each registered Holder, the obligation to
deliver to such Holder such shares of stock, securities or assets as, in
accordance with the foregoing provisions, such Holder may be entitled to
receive. Nothing contained in this Section, shall limit the Holder's obligation
to participate in an Approved Sale (as defined in the Shareholders Agreement) in
accordance with the provisions of the Shareholders Agreement.
7.3. Voluntary Adjustment by the Company. The Company may at its option, at
any time during the term of this Warrant, reduce the then current Exercise Price
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to any amount and for any period of time deemed appropriate by the Board of
Directors of the Company, including such reductions in the Exercise Price as the
Company considers to be advisable in order that any event treated for Federal
income tax purposes as a dividend of stock or stock rights shall not be taxable
to the recipients; provided, however, that no such adjustment in Exercise Price
shall affect the number of Warrant Shares.
7.4. Notice of Adjustment. Whenever the number of Warrant Shares or the
Exercise Price is required to be adjusted, as herein provided, the Company
promptly shall deliver to each Holder, notice of such adjustment or adjustments
and a certificate of a firm of independent public accountants selected by the
Board of Directors of the Company (who may be the regular accountants employed
by the Company) setting forth the number of Warrant Shares and the Exercise
Price after such adjustment, setting forth a brief statement of the facts
requiring such adjustment and setting forth the computation by which such
adjustment was made.
7.5. Other Events. If any event occurs as to which the foregoing provisions
of this Section 7 are not strictly applicable or, if strictly applicable, would
not, fairly and adequately protect the purchase rights represented by the
Warrants in accordance with the essential intent and principles of such
provisions, then the Company shall make such adjustments in the application of
such provisions, in accordance with such essential intent and principles, as
shall be necessary to protect such purchase rights as aforesaid.
7.6. Statement on Warrant Certificates. Irrespective of any adjustments in
the Exercise Price or the number or kind of Warrant Shares, this Warrant may
continue to express the same price and number and kind of shares as are stated
on the front page hereof.
7.7. Exceptions to Adjustment. Anything herein to the contrary
notwithstanding, the Company shall not be required to make any adjustment of the
number of Warrant Shares issuable hereunder in the case of the issuance of the
Warrants or the issuance of shares of the Common Stock upon exercise of the
Warrants.
7.8. Treasury Warrant Shares. The number of shares of the Common Stock
outstanding at any time shall not include shares owned or held by or for the
account of the Company or any of its subsidiaries, and the disposition of any
such shares shall be considered an issue or sale of the Common Stock for the
purposes of this Section 7.
7.9. Company to Prevent Dilution. In case at any time or from time to time
conditions arise by reason of action taken by the Company or any of its
subsidiaries which are not adequately covered by the provisions of this Section
7, or which might adversely affect the exercise rights of the registered
Holders, the Board of Directors of the Company shall appoint a firm of
independent certified public accountants of recognized
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national standing, which may be the firm regularly retained by the Company,
which shall give their opinion upon the adjustment, if any, necessary with
respect to the number of Warrant Shares into which this Warrant is exercisable,
on a basis consistent with the standards established in the other provisions of
this Section 7, so as to preserve, without dilution, the exercise rights of the
registered Holders. Upon receipt of such opinion, the Board of Directors of the
Company shall forthwith make the adjustments described therein.
8. SPECIAL COVENANTS OF THE COMPANY
The Company covenants and agrees that until the Expiration Date:
(a) The Company will not, by amendment of its Certificate of Incorporation
or through any reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities or any other voluntary action, directly
or indirectly avoid or seek to avoid the observance or performance of any of the
terms of this Warrant, or the Shareholders Agreement, but will at all times in
good faith assist in the carrying out of all such terms and in the taking of all
such action as may be necessary or appropriate in order to protect the rights of
the Holders against impairment. Without limiting the generality of the
foregoing, the Company (i) will not increase the par value of any share of stock
receivable upon the exercise of the Warrants above the Exercise Price payable
therefor upon such exercise, and (ii) will take all such action as may be
necessary or appropriate in order that the Company may validly and legally issue
fully paid and non-assessable shares of stock upon the exercise of all Warrants
from time to time outstanding (including as a result of a reduction in the
purchase price pursuant to the terms hereof).
(b) If any Warrant Shares required to be reserved for the purposes of
exercise of this Warrant require registration with or approval of any
governmental authority under any federal law (other than the Securities Act) or
under any state law before such Warrant Shares may be issued upon exercise of
this Warrant, the Company will, at its expense, as expeditiously as possible use
its best efforts to cause such Warrant Shares to be duly registered or approved,
as the case may be.
(c) If at any time Common Stock is listed on any national securities
exchange (as defined in the Exchange Act), the Company will, at its expense,
obtain and maintain the approval for listing on each such exchange upon official
notice of issuance of all Warrant Shares receivable upon the exercise of the
Warrants at the time outstanding and maintain the listing of such Warrant Shares
after their issuance; and the Company will so list on such national securities
exchange, will register under the Exchange Act (and any similar state statute
then in effect), and will maintain such listing of, any other securities that at
any time are issuable upon
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exercise of the Warrants, if and at the time that any securities of the same
class shall be listed on such national securities exchange by the Company.
(d) The Company covenants and agrees to give each Holder, as reflected in
books and records of the Company, prior written notice of the expiration of the
Exercise Period of the Warrants. Such notice shall be delivered not less than
thirty (30) days but not more than sixty (60) days prior to such expiration;
provided, that if the Company fails to give such notice, the expiration of such
Exercise Period shall not occur, until thirty (30) days after such notice is
delivered.
(e) The Company covenants that, following an initial public offering of the
Common Stock it will file any reports required to be filed by it under the
Securities Act and the Exchange Act and, whether or not the Company has effected
an initial public offering, it will take such further action as any Holder may
reasonably request, all to the extent required from time to time to enable such
Holder to sell Warrant Shares without registration under the Securities Act
within the limitation of the exemptions provided by (a) Rules 144 and 144A under
the Securities Act, as such Rules may be amended from time to time, or (b) any
similar rules or regulations or regulations hereafter adopted by the Commission;
provided, that any such sale shall also be made in accordance with the terms and
provisions of the Stockholders Agreement. Upon the request of any Holder, the
Company will deliver to such Holder a written statement as to whether it has
complied with such requirements.
(f) The Company agrees that the fair market value of the Warrants, when
taken together with the terms of the Indebtedness arising under the Credit
Agreement (the "Credit Agreement Debts"), will not result in any original issue
discount ("OID") for federal income tax purposes with respect to the Credit
Agreement Debt and the Company agrees not to claim any OID with respect to the
Credit Agreement Debt.
9. NOTIFICATION BY THE COMPANY
In case at any time:
(i) the Company shall declare any dividend or make any distribution upon
its Common Stock; or
(ii) the Company shall offer for subscription pro-rata to the holders of
its Common Stock any additional shares of stock of any class or any other
securities
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convertible into or exchangeable for shares of stock or any rights or options to
subscribe thereto; or
(iii) the Board of Directors of the Company shall authorize any capital
reorganization, reclassification or similar transaction involving the capital
stock of the Company, or a sale or conveyance of all or a substantial part of
the assets of the Company, or a consolidation, merger or business combination of
the Company with another Person; or
(iv) actions or proceedings shall be authorized or commenced for a
voluntary or involuntary dissolution, liquidation or winding-up of the Company;
then, in any one or more of such cases, the Company shall give written notice to
the Holder, at the earliest time legally practicable (and not less than 30 days
before any record date or other date set for definitive action) of the date on
which (A) the books of the Company shall close or a record shall be taken for
such dividend, distribution or subscription rights or options or (B) such
reorganization, reclassification, sale, conveyance, consolidation, merger,
dissolution, liquidation or winding-up shall take place or be voted on by
stockholders of the Company, as the case may be. Such notice shall also specify
the date as of which the holders of the Common Stock of record shall participate
in said dividend, distribution, subscription rights or options or shall be
entitled to exchange their Common Stock for securities or other property
deliverable upon such reorganization, reclassification, sale, conveyance,
consolidation, merger, dissolution, liquidation or winding-up, as the case may
be. If the action in question or the record date is subject to the effectiveness
of a registration statement under the Securities Act or to a favorable vote of
stockholders, the notice required by this Section 9 shall so state.
10. NO VOTING RIGHTS; LIMITATIONS OF LIABILITY
Prior tO exercise, this Warrant will not entitle the Holder to any voting
rights or other rights as a stockholder of the Company. No provision hereof, in
the absence of affirmative action by the Holder to purchase Common Stock, and no
enumeration herein of the rights or privileges of the Holder shall give rise to
any liability of such Holder for the purchase price of Common Stock acquirable
by exercise hereof or as a stockholder of the Company.
11. DATE OF ISSUANCE
The date the Company initially issues this Warrant will be deemed to be the
"Date of Issuance" hereof and of each new Warrant issued in exchange, transfer
or
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replacement hereof, regardless of the number of times new certificates
representing the unexpired and unexercised rights formerly represented by this
Warrant shall be issued.
12. AMENDMENT AND WAIVER
(a) No failure or delay of the Holder in exercising any power or right
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of such right or power, or any abandonment or discontinuance of steps
to enforce such a right or power, preclude any other or further exercise thereof
or the exercise of any other right or power. The rights and remedies of the
Holder are cumulative and not exclusive of any rights or remedies which it would
otherwise have. The provisions of this Warrant may be amended, modified or
waived with (and only with) the written consent of the Company and the Majority
of the Warrant Interests.
(b) Any such amendment, modification or waiver effected pursuant to this
Section 12 shall be binding upon the Holders of all Warrants and Warrant Shares,
upon each future holder thereof, upon the Company and its shareholders. In the
event of any such amendment, modification or waiver, the Company shall give
prompt written notice thereof to all Holders and, if appropriate, notation
thereof shall be made on all Warrants thereafter surrendered for registration of
transfer or exchange.
(c) No notice or demand on the Company in any case shall entitle the
Company to any other or further notice or demand in similar or other
circumstances.
13. NO FRACTIONAL WARRANT SHARES
The Company shall not be required to issue stock certificates representing
fractions of Warrant Shares, but may at its option in respect of any final
fraction of a Warrant Share make a payment in cash based on the then current
market price of the Common Stock (as determined in accordance with Section 7.1
(d)) after giving effect to the full exercise or conversion of the Warrants.
14. RESERVATION OF WARRANT SHARES
The Company will authorize, reserve and keep available at all times, free
from preemptive rights, a sufficient number of Warrant Shares to satisfy the
requirements of this Warrant and any other outstanding Warrants.
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15. NOTICES
All notices, requests, consents and other communications hereunder shall be
in writing (including, telegraphic, telex, facsimilar or cable communication)
and delivered, mailed telegraphed, telexed, telecopied or cabled:
(i) if to the Holder, at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxxxxx Xxxxxxxxxx or at such other address as may have been
furnished to the Company in writing by the Holder; and
(ii) if to the Company, at 000 Xxxxxxxxxx Xxxxxxx, Xxxxxxxxxx, Xxx Xxxxxx
00000, Attention: President, or at such other address as may have been furnished
to the Holder in writing by the Company.
All such notices and communications when mailed, telegraphed, telexed,
facsimiled, or cabled or sent by overnight courier, be effective 3 Business Days
after deposited in the mails, certified return receipt requested, when delivered
to the telegraph company, cable company or one day following delivery to an
overnight courier, as the case may be, or sent by telex or facsimilar device.
16. HEADINGS
The headings of the Sections and subsections of this Warrant are inserted
for convenience only and shall not be deemed to constitute a part of this
Warrant.
17. GOVERNING LAW; CONSENT TO JURISDICTION
THIS WARRANT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF DELAWARE. If any action or proceeding shall be brought by
any Holder in order to enforce any right or obligation in respect of this
Warrant, the Company hereby consents and will submit to the jurisdiction of any
state or federal court of competent jurisdiction sitting within the area
comprising the Southern District of New York on the date of this Warrant, and
agrees that venue will be proper in any such court.
18. BINDING EFFECT
The terms and provisions of this Warrant shall inure to the benefit of the
original Holder and its successors and assigns and shall be binding upon the
Company and
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its successors and assigns, including, without limitation, any Person succeeding
to the Company by merger, consolidation or acquisition of all or substantially
all of the Company's assets.
IN WITNESS WHEREOF, the seal of the Company and the signatures of its duly
authorized officers have been affixed hereto as of the date first written above.
CDI GROUP, INC
By /s/ [illegible]
-------------------------
Title:
EXHIBIT A
ASSIGNMENT
To Be Executed by the Registered Holder
Desiring to Transfer the Within Warrant of
CDI GROUP, INC.
FOR VALUE RECEIVED, the undersigned registered holder hereby sells, assigns and
transfers unto _______ the right to purchase ___ shares of the Class A Common
Stock covered by the within Warrant, and does hereby irrevocably constitute and
appoint_________________________ Attorney to transfer the said Warrant on the
books of the Company (as defined in said Warrant), with full power of
substitution.
Name of
Registered Holder __________
Signature:____________________
Title:
Address:
Dated:____________
In the presence of
___________________
NOTICE:
The signature to the foregoing Assignment must correspond to the name
written upon the face of the within Warrant in every particular, without
alteration or enlargement or any change whatsoever.
EXHIBIT B
EXERCISE AGREEMENT
To Be Executed by the Registered Holder
Desiring to Exercise the Within Warrant of
CDI GROUP, INC.
The undersigned registered holder hereby exercises the right to purchase
_____shares of the Class A Common Stock covered by the within Warrant, according
to the conditions thereof, and herewith make payment in full of the Exercise
Price of such shares, $ ____.
Name of
Registered Holder ______________
Signature: _____________________
Title:
Address:
Dated:____________
AMENDMENT OF COMMON STOCK PURCHASE WARRANT,
ACKNOWLEDGMENT AND WAIVER
This AMENDMENT OF COMMON STOCK PURCHASE WARRANT, ACKNOWLEDGMENT AND
WAIVER, dated as of September 30, 1997, is made by and between CDI Group, Inc.,
a corporation organized and existing under the laws of the State of Delaware
(the "Company"), and Banque Paribas, acting by and through its Cayman Island
Branch ("Paribas").
BACKGROUND
WHEREAS, in connection with the acquisition by the Company of Community
Distributors, Inc., a corporation organized and existing under the laws of the
State of Delaware ("CDI"), on January 30, 1995, which was partially financed
through a term loan pursuant to a Credit Agreement under which Paribas served as
Agent, the Company issued Paribas a Common Stock Purchase Warrant (the
"Warrant"), pursuant to a Common Stock Purchase Warrant, dated as of January 30,
1995 (the "Warrant Agreement"), to purchase 16,667 shares (the "Warrant
Shares"), of the Company's Class A Common Stock, $.00001 par value per share;
WHEREAS, the Warrant Agreement provides for the adjustment of the
number of Warrant Shares upon the occurrence of certain events, including the
payment of certain distributions on the capital stock of the Company;
WHEREAS, CDI intends to issue approximately $80,000,000 in Senior Notes
due 2004 (the "Offering"), and use the proceeds thereof to (i) repay
substantially all of CDI's existing indebtedness, and (ii) pay a dividend of
approximately $45,000,000 to the Company, its sole stockholder, which in turn
intends to use such funds to make a similar distribution (the "Dividend") to its
shareholders;
WHEREAS, pursuant to an Investor Securities Purchase Agreement, dated
as of January 30, 1995 and entered into between the Company and the Investors
named therein (the "Purchase Agreement"), Paribas and certain other of such
Investors were given the option to elect to receive their pro rata potions of
certain distributions made by the Company, including with respect to any shares
issuable upon the exercise of the Warrant; and
WHEREAS, the Company and Paribas understand and agree that the anti-
dilution provisions in the Warrant Agreement are not intended to operate with
respect to distributions by the Company with respect to which Paribas desires to
elect to receive its pro rata portion with respect to the Warrant Shares and,
correspondingly, the Company and Paribas have agreed to amend the Warrant to
permit Paribas to elect to receive its pro rata portion of the Dividend without
triggering the anti-dilution provision of the Warrant Agreement;
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NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Company and Paribas hereby
agree as follows:
1. Amendment of Warrant Agreement.
The Warrant Agreement is hereby amended by inserting the following
sentence at the end of Section 7.1(c):
"Notwithstanding anything in the contrary in this Agreement, in no
event shall the number of Warrant Shares issuable hereunder be adjusted
in connection with, or as a direct or indirect result of, any
distribution to any holder of Common Stock or Rights of evidence of
indebtedness or assets (including cash) to the extent that any Holders
receive their proportionate share of such distribution in accordance
with the Investor Securities Purchase Agreement in connection with, or
as a direct or indirect result of, its ownership of the Warrant or the
right to receive Warrant Shares upon exercise hereof."
2. Payment of Dividend.
The Company hereby acknowledges that Paribas has exercised its option
pursuant to Section 6.6 of the Purchase Agreement to receive its pro rata share
of the Dividend, if paid, with respect to the Warrant Shares.
3. Waiver of Notice.
Paribas hereby irrevocably waives its right to receive notice of the
record date for determining the shareholders of the Company entitled to
participate in the Dividend, whether such right may arise pursuant to Section 9
of the Warrant Agreement or otherwise.
4. No Other Amendment or Waiver.
Except as specifically provided herein, the Warrant Agreement shall
remain in full force and effect in the form in which it existed on the date
hereof prior to giving
effect to the terms of this Amendment to Common Stock Warrant Agreement,
Acknowledgment and Waiver and the Company and Paribas ratify and reaffirm the
Warrant Agreement in its entirety, as modified hereby. Except as specifically
provided herein, this Amendment to Common Stock Warrant Agreement,
Acknowledgment and Waiver shall not constitute an acceptance or waiver of any
other provision of the Warrant Agreement.
5. Governing Law.
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This Amendment of Common Stock Warrant Agreement, Acknowledgment and
Waiver and the rights and obligations of the parties hereunder shall be
construed in accordance with and governed by the laws of the State of Delaware.
IN WITNESS WHEREOF, the parties hereto have cause this Amendment of
Common Stock Purchase Warrant, Acknowledgment and Waiver to be duly executed as
an instrument under seal as of the date first above written.
CDI GROUP, INC.
By: _______________________________
Title: ______________________
BANQUE PARIBAS, acting by and
through its
Cayman Island Branch
By: _______________________________
Title: ______________________
